<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 7, 1997
REGISTRATION NO. 333-38957
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1
TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
JITNEY-JUNGLE STORES OF AMERICA, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
MISSISSIPPI 5411 64-0280539
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NO.)
</TABLE>
------------------------
1770 ELLIS AVENUE, SUITE 200
JACKSON, MISSISSIPPI 39204
(601) 965-8600
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------------
SEE TABLE OF ADDITIONAL REGISTRANTS BELOW
------------------------
DAVID R. BLACK
SENIOR VICE PRESIDENT, FINANCE AND CHIEF FINANCIAL OFFICER
JITNEY-JUNGLE STORES OF AMERICA, INC.
1770 ELLIS AVENUE, SUITE 200
JACKSON, MISSISSIPPI 39204
(601) 965-8600
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------------
WITH COPIES TO:
BRUCE B. WOOD, ESQ.
DECHERT PRICE & RHOADS
30 ROCKEFELLER PLAZA
NEW YORK, NEW YORK 10112
(212) 698-3500
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. / /
------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED PER UNIT(1) OFFERING PRICE(1) REGISTRATION FEE
<S> <C> <C> <C> <C>
10 3/8% Senior Subordinated Notes due 2007....... $200,000,000 100% $200,000,000 $60,607(2)
Guarantees of Senior Subordinated Notes.......... $200,000,000 -- -- None
</TABLE>
(1) Estimated pursuant to Rule 457(f) solely for purposes of calculating the
registration fee.
(2) Previously paid.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC.
TABLE OF ADDITIONAL REGISTRANTS
<TABLE>
<CAPTION>
STATE OR
OTHER PRIMARY STANDARD
JURISDICTION INDUSTRIAL IRS EMPLOYER
OF CLASSIFICATION IDENTIFICATION
NAME INCORPORATION CODE NUMBER NUMBER
- -------------------------------------------------------------- ----------- ---------------------- -------------
<S> <C> <C> <C>
Interstate Jitney-Jungle Stores, Inc.......................... Alabama 5411 64-0728553
McCarty-Holman Co., Inc....................................... Mississippi 5411 64-0294093
Southern Jitney Jungle Company................................ Mississippi 5411 64-0280601
Pump And Save, Inc............................................ Mississippi 5411 64-0779730
Supermarket Cigarette Sales, Inc.............................. Louisiana 5194 72-1029831
Jitney-Jungle Bakery, Inc..................................... Mississippi 2051 64-0462232
Delchamps, Inc................................................ Alabama 5411 63-0245434
</TABLE>
The address, including zip code, and telephone number, including area code,
for each of the additional registrants' principal executive offices, other than
Supermarket Cigarette Sales, Inc. and Delchamps, Inc., is 1770 Ellis Avenue,
Suite 200, Jackson, Mississippi 39204 (601) 965-8600, and the address, including
zip code, and telephone number, including area code, for the principal executive
offices of Supermarket Cigarette Sales, Inc. and Delchamps, Inc. is 305
Delchamps Drive, Mobile, Alabama 36602 (334) 433-0437.
ii
<PAGE>
PROSPECTUS
[LOGO]
OFFER TO EXCHANGE
10 3/8% SENIOR SUBORDINATED NOTES DUE 2007
FOR ALL OUTSTANDING
10 3/8% SENIOR SUBORDINATED NOTES DUE 2007
OF
JITNEY-JUNGLE STORES OF AMERICA, INC.
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME ON DECEMBER 10, 1997, UNLESS EXTENDED
Jitney-Jungle Stores of America, Inc., a Mississippi corporation
("Jitney-Jungle" or the "Company"), hereby offers to exchange an aggregate
principal amount of up to $200,000,000 of its 10 3/8% Senior Subordinated Notes
due 2007 (the "New Notes") for a like principal amount of its 10 3/8% Senior
Subordinated Notes due 2007 (the "Existing Notes") outstanding on the date
hereof upon the terms and subject to the conditions set forth in this Prospectus
and in the accompanying letter of transmittal (the "Letter of Transmittal" and,
together with this Prospectus, the "Exchange Offer"). The New Notes and the
Existing Notes are hereinafter collectively referred to as the "Notes." The
terms of the New Notes are identical in all material respects to those of the
Existing Notes, except for certain transfer restrictions and registration rights
relating to the Existing Notes. The New Notes will be issued pursuant to, and be
entitled to the benefits of, the Indenture (as defined) governing the Existing
Notes.
The New Notes will bear interest from and including the date of consummation
of the Exchange Offer. Interest on the New Notes will be payable semi-annually
on March 15 and September 15 of each year, commencing March 15, 1998.
Additionally, interest on the New Notes will accrue from the last interest
payment date on which interest was paid on the Existing Notes surrendered in
exchange therefor or, if no interest has been paid on the Existing Notes, from
the date of original issue of the Existing Notes.
The New Notes will be general unsecured obligations of the Company,
subordinated in right of payment to all existing and future Senior Debt (as
defined) of the Company, including indebtedness pursuant to the 12% Senior Notes
due 2006 of the Company (the "Senior Notes") and the Senior Credit Facility (as
defined). The New Notes will be guaranteed (the "Subsidiary Guarantees"),
jointly and severally, on a senior subordinated basis by all of the Company's
Restricted Subsidiaries (as defined)(the "Subsidiary Guarantors"). The
Subsidiary Guarantees will be subordinated in right of payment to all existing
and future Senior Debt of the Subsidiary Guarantors, including the guarantees of
the Subsidiary Guarantors of the Company's obligations under the Senior Notes
and the Senior Credit Facility. At July 26, 1996, on a Pro Forma Basis (as
defined), the Company would have had approximately $348.1 million of Senior Debt
outstanding (exclusive of an unused commitment of up to $66.1 million under the
Senior Credit Facility) and the Subsidiary Guarantors would have had
approximately $10.4 million of Senior Debt outstanding (excluding guarantees by
the Subsidiary Guarantors of the Company's obligations under the Senior Notes
and the Senior Credit Facility).
The New Notes are being offered hereunder in order to satisfy certain
obligations of the Company contained in the Registration Rights Agreement dated
September 15, 1997 (the "Registration Rights Agreement") by and among the
Company, the Subsidiary Guarantors, Donaldson, Lufkin & Jenrette Securities
Corporation ("DLJ") and Credit Suisse First Boston (together with DLJ, the
"Initial Purchasers") with respect to the initial sale of the Existing Notes.
The Company will not receive any proceeds from the Exchange Offer. The
Company will pay all the expenses incident to the Exchange Offer. Tenders of
Existing Notes pursuant to the Exchange Offer may be withdrawn at any time prior
to the Expiration Date (as defined) for the Exchange Offer. In the event the
Company terminates the Exchange Offer and does not accept for exchange any
Existing Notes with respect to the Exchange Offer, the Company will promptly
return such Existing Notes to the holders thereof. See "The Exchange Offer."
Each broker-dealer that receives New Notes for its own account pursuant to
the Exchange Offer must acknowledge that it will deliver a prospectus in
connection with any resale of such New Notes. The Letter of Transmittal states
that by so acknowledging and by delivery of a prospectus, a broker-dealer will
not be deemed to admit that it is an "underwriter" within the meaning of the
Securities Act of 1933, as amended (the "Securities Act"). This Prospectus, as
it may be amended or supplemented from time to time, may be used by a
broker-dealer in connection with resales of New Notes received in exchange for
Existing Notes where such Existing Notes were acquired by such broker-dealer as
a result of market-making activities or other trading activities. The Company
has agreed that, for a period of 180 days after the Expiration Date, it will
make this Prospectus available to any broker-dealer for use in connection with
any such resale. See "Plan of Distribution."
Prior to the Exchange Offer, there has been no public market for the
Existing Notes. If a market for the New Notes should develop, such New Notes
could trade at a discount from their principal amount. The Company currently
does not intend to list the New Notes on any securities exchange or to seek
approval for quotation through any automated quotation system, and no active
public market for the New Notes is currently anticipated. There can be no
assurance that an active public market for the New Notes will develop.
The Exchange Offer is not conditioned upon any minimum principal amount of
Existing Notes being tendered for exchange pursuant to the Exchange Offer.
--------------------------
SEE "RISK FACTORS" COMMENCING ON PAGE 14 FOR A DISCUSSION OF CERTAIN FACTORS
THAT HOLDERS OF EXISTING NOTES SHOULD CONSIDER IN CONNECTION WITH THE EXCHANGE
OFFER.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
--------------------------
The date of this Prospectus is November 7, 1997.
<PAGE>
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission" or the "SEC") a Registration Statement on Form S-4 (the "Exchange
Offer Registration Statement," which term shall encompass all amendments,
exhibits, annexes and schedules thereto) pursuant to the Securities Act, and the
rules and regulations promulgated thereunder, covering the New Notes being
offered hereby. This Prospectus does not contain all the information set forth
in the Exchange Offer Registration Statement. For further information with
respect to the Company and the Exchange Offer, reference is made to the Exchange
Offer Registration Statement. Statements made in this Prospectus as to the
contents of any contract, agreement or other document referred to are not
necessarily complete. With respect to each such contract, agreement or other
document filed as an exhibit to the Exchange Offer Registration Statement,
reference is made to the exhibit for a more complete description of the document
or matter involved, and each such statement shall be deemed qualified in its
entirety by such reference.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Commission. Such reports
and other information, including the Exchange Offer Registration Statement and
exhibits thereto, can be inspected and copied at the public reference facilities
maintained by the Commission at Room 1024, 450 Fifth Street, N.W., Washington
D.C. 20549, and at the Commission's regional offices in Suite 1400, Northwest
Atrium Center, West Madison Street, Chicago, Illinois 60661, and 7 World Trade
Center (13th floor), New York, New York 10048. Copies of such material can be
obtained from the Commission at prescribed rates through its Public Reference
Section at 450 Fifth Street. N.W., Washington, D.C. 20549. The Commission also
maintains a site on the World Wide Web, the address of which is
http://www.sec.gov, that contains reports, proxy and information statements and
other information regarding issuers, such as the Company, that file
electronically with the Commission. In the event the Company ceases to be
subject to the informational requirements of the Exchange Act, the Indenture
provides that the Company will be required, for so long as any of the Notes
remain outstanding, to furnish to the Trustee (as defined) and deliver or cause
to be delivered to the holders of the Notes and file with the Commission
(provided that the Commission will accept such filing) (i) all quarterly and
annual financial information that would be required to be contained in a filing
with the Commission on Forms 10-Q and 10-K if the Company were required to file
such forms, including for each a "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and, with respect to the annual
information only, a report thereon by the Company's certified independent
accountants, and (ii) all reports that would be required to be filed with the
Commission on Form 8-K if the Company were required to file such reports.
This Prospectus includes forward-looking statements which involve risks and
uncertainties as to future events. Actual events or results may differ
materially from those discussed in the forward-looking statements as a result of
various factors, including, without limitation, those set forth under "Risk
Factors".
2
<PAGE>
SUMMARY
THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE DETAILED
INFORMATION AND FINANCIAL STATEMENTS, INCLUDING THE NOTES THERETO, APPEARING
ELSEWHERE IN THIS PROSPECTUS. UNLESS THE CONTEXT OTHERWISE REQUIRES, (I) THE
TERM "JITNEY-JUNGLE" REFERS TO JITNEY-JUNGLE STORES OF AMERICA, INC., (II) THE
TERM "DELCHAMPS" REFERS TO DELCHAMPS, INC., AN ALABAMA CORPORATION, (III) THE
TERM "THE COMPANY" REFERS TO JITNEY-JUNGLE AND ITS CONSOLIDATED SUBSIDIARIES
(INCLUDING DELCHAMPS) AS IF THE DELCHAMPS ACQUISITION (AS DEFINED) HAD BEEN
CONSUMMATED AND (IV) THE TERM "MANAGEMENT" REFERS TO THE MANAGEMENT TEAM OF
JITNEY-JUNGLE. REFERENCES HEREIN TO 'FISCAL YEARS' ARE TO THE FISCAL YEARS OF
JITNEY-JUNGLE AND DELCHAMPS, AS APPLICABLE, WHICH END ON THE SATURDAY NEAREST TO
APRIL 30 AND THE SATURDAY NEAREST TO JUNE 30, RESPECTIVELY, IN THE CALENDAR
YEAR. PRO FORMA DATA INCLUDED HEREIN FOR THE "LTM PERIOD" REFLECT THE RESULTS OF
OPERATIONS OF JITNEY-JUNGLE FOR THE 53 WEEKS ENDED JULY 26, 1997 AND THE RESULTS
OF OPERATIONS OF DELCHAMPS FOR THE FISCAL YEAR ENDED JUNE 28, 1997, AND INCLUDE
THE PRO FORMA ADJUSTMENTS DESCRIBED UNDER "PRO FORMA CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS." REFERENCES HEREIN TO THE "SOUTHEAST" ARE TO THE STATES OF
ALABAMA, ARKANSAS, FLORIDA, LOUISIANA, MISSISSIPPI AND TENNESSEE, AND REFERENCES
HEREIN TO THE NUMBER OF SUPERMARKETS OPERATED BY THE COMPANY ARE TO THE ACTUAL
TOTALS AFTER GIVING EFFECT TO THE ANTICIPATED STORE DISPOSITIONS (AS DEFINED).
CERTAIN MARKET DATA USED IN THIS PROSPECTUS REFLECT MANAGEMENT ESTIMATES; WHILE
SUCH ESTIMATES ARE BELIEVED TO BE RELIABLE, NO ASSURANCE CAN BE GIVEN THAT SUCH
DATA IS ACCURATE IN ALL MATERIAL RESPECTS.
THE COMPANY
The Company is a leading operator of supermarkets in the Southeast. Upon
consummation of the Delchamps Acquisition, the Company will operate 199
supermarkets located throughout Mississippi and Alabama as well as in selected
markets in Tennessee, Arkansas, Louisiana and Florida. In addition, the Company
will be the largest supermarket operator in Mississippi and the second largest
supermarket operator in Alabama, with 81 supermarkets in Mississippi and 49
supermarkets in Alabama. The Company will account for an estimated 32% of the
grocery sales in Mississippi and an estimated 18% of the grocery sales in
Alabama. Jitney-Jungle currently has an estimated 50% of the grocery sales in
Jackson, Mississippi and Delchamps has an estimated 37% of the grocery sales in
Mobile, Alabama. Jitney-Jungle and Delchamps also have the number one, two or
three market share position in approximately 80% of the major markets in which
they operate. The Delchamps Acquisition is expected to increase the Company's
geographic diversification because the Delchamps stores are primarily located in
areas in which Jitney-Jungle currently has no stores. At the same time, the
Delchamps Acquisition is expected to result in valuable purchasing, distribution
and marketing synergies for the Company. On a Pro Forma Basis, the Company would
have had approximately $2.2 billion of net sales and approximately $127.8
million of EBITDA (as defined) for the LTM Period.
Management believes that the Company has significant competitive advantages,
which include:
STRONG FRANCHISE AND PRIME SITES. The Company has a strong consumer
franchise built around the "Jitney-Jungle" and "Delchamps" names. Management
believes that the Company's customers associate these names with quality, value,
convenience and superior service. In addition, Management believes that most of
the Company's urban supermarkets are in high-traffic locations that offer
significant competitive advantages, and that many of its supermarkets located in
smaller towns and rural areas are located on prime, non-replicable sites.
MODERN SUPERMARKET BASE. During the last five fiscal years, Jitney-Jungle
and Delchamps invested approximately $147.0 million and $111.0 million,
respectively, in capital expenditures, a substantial majority of which was for
building new supermarkets and expanding or remodeling existing supermarkets.
Approximately 81% of the Company's supermarket base has been built or remodeled
within the past five fiscal years.
3
<PAGE>
SUCCESSFUL PRIVATE LABEL PROGRAM. In addition to branded products, the
Company's supermarkets offer a selection of private label products bearing the
brand names of Topco Associates, Inc. ("Topco"), the largest cooperative grocery
products purchasing organization in the United States. The Company's affiliation
with Topco enables it to procure quality merchandise on a competitive basis with
larger, national food retailers. Pro forma net sales of private label products,
which generally have a lower unit sales price than national brands but provide a
higher gross margin due to lower unit costs, accounted for approximately 18.2%
of pro forma net non-perishable sales of the Company during the LTM Period.
CENTRALIZED AND EFFICIENT DISTRIBUTION FACILITIES. The Company's
distribution facility located in Jackson, Mississippi is conveniently located
close to major highways and provides a central delivery site for vendors. This
facility includes an aggregate of 814,000 square feet of warehouse space and can
efficiently supply the Company's 199 supermarkets, as well as potential new
markets contiguous to existing markets.
THE ACQUISITION AND EXPECTED BENEFITS
During fiscal 1997, Delchamps generated net sales and EBITDA of
approximately $1.1 billion and $44.1 million, respectively. In addition to the
incremental net sales, EBITDA and market share expected to result from the
Delchamps Acquisition, Management believes that it should be able to achieve
significant cash cost savings as a result of the elimination of certain
duplicative costs, increased operating efficiencies and increased purchasing
leverage in connection with the combined operation of the Jitney-Jungle and
Delchamps businesses following the Delchamps Acquisition. While the exact timing
and amount of such cash cost savings is inherently uncertain, Management
currently expects that the Company should begin to realize such cash cost
savings within three to nine months following the Delchamps Acquisition.
Specific anticipated benefits of the Delchamps Acquisition include:
- REDUCED GENERAL AND ADMINISTRATIVE EXPENSE. In connection with the
Delchamps Acquisition, Management expects to consolidate the corporate
headquarters of the Company's combined operations in the existing
corporate headquarters of Jitney-Jungle. Although a divisional office will
be opened in Mobile, Alabama, the Delchamps Mobile headquarters will be
closed and approximately 160 positions currently held by employees at the
Jitney-Jungle and Delchamps corporate headquarters will be eliminated.
Management estimates that such measures should result in approximately
$9.3 million of annualized cash cost savings, which the Company should
begin to realize within three to six months following the Delchamps
Acquisition.
- IMPROVED WAREHOUSING AND DISTRIBUTION EFFICIENCIES. Jitney-Jungle owns or
leases 814,000 square feet of warehouse space located in Jackson,
Mississippi which is central to, and can efficiently supply, all of the
Company's 199 supermarkets. In connection with the Delchamps Acquisition,
Management expects to close the Hammond, Louisiana warehouse owned by
Delchamps and to utilize Jitney-Jungle's Jackson facility as the Company's
central distribution center, thereby reducing headcount and general and
administrative expenses. In addition, in order to more efficiently utilize
the Jackson facility Jitney-Jungle has negotiated a long-term supply
agreement with a supplier to provide direct store delivery of frozen foods
and selected grocery products to the Company's supermarkets, which
Management believes should result in lower distribution costs and a
decrease of approximately 35% in inventory levels. Management believes
that, on an annualized basis, the combined effect of these warehousing and
distribution efficiencies should result in approximately $3.9 million of
cash cost savings, which the Company should to begin to realize within
three to six months following the Delchamps Acquisition.
- REDUCED ADVERTISING AND PRINTING EXPENSES. Jitney-Jungle and Delchamps
operate in contiguous and overlapping geographic areas, particularly in
south Mississippi and Florida. As a result, Management believes that it
will be able to consolidate the Company's advertising in these regions,
thus reducing advertising expenses. In addition, while Delchamps currently
outsources the printing of its advertising circulars, after the Delchamps
Acquisition approximately 50% of such printing will be
4
<PAGE>
performed at Jitney-Jungle's in-house printing facility. Management
estimates that moving a portion of Delchamps' printing in-house should
result in annualized cash cost savings of approximately $1.0 million,
which the Company should begin to realize within three to six months
following the Delchamps Acquisition.
- INCREASED PURCHASING LEVERAGE. Management expects that Jitney-Jungle's
merchandise purchases will approximately double following the Delchamps
Acquisition. As a result of this increase and the Company's leading market
position, Management believes that the Company should be able to negotiate
more favorable terms from vendors, including suppliers of products carried
on an exclusive or promoted basis, and to convert some less-than-truckload
shipping quantities to full truckload quantities. Management believes that
this increased purchasing leverage should result in approximately $3.4
million in annualized cash cost savings, which the Company should begin to
realize within six to nine months following the Delchamps Acquisition.
- INCREASED BACKHAUL INCOME. The expected increase in merchandise purchases
following the Delchamps Acquisition and the resulting improvements in the
Company's purchasing leverage are expected to create additional
opportunities to increase backhaul income, thereby reducing the Company's
operating costs. In particular, the Company's increased presence in the
Louisiana and Florida markets should result in a higher number of
deliveries to those areas, which have historically provided Jitney-Jungle
with backhaul opportunities. Management believes that increased backhaul
income should result in annualized cash cost savings of approximately $1.8
million, which the Company should begin to realize within three to six
months following the Delchamps Acquisition.
Of the aggregate potential $19.4 million in annualized cash cost savings
discussed above, approximately $14.2 million are reflected in the Pro Forma
Condensed Consolidated Financial Statements included elsewhere herein because
Management believes that they are factually supportable and directly related to
the Transactions (as defined) and the Delchamps Merger (as defined). Actual cash
cost savings achieved by the Company may vary considerably from the estimates
discussed above. See 'Risk Factors-- Integration of Delchamps.'
BUSINESS STRATEGY
The Company's business strategy is focused on enhancing the Company's
revenues and profitability by capitalizing on its leading market positions and
continuing its growth in certain attractive Southeast markets. Management
believes that the Company's leading perishables and grocery merchandising,
competitive pricing, range of specialty departments and reputation for quality
will help the Company continue its strong history of growth and profitability.
The Company's specific business strategies include:
- EXPAND SUPERMARKET BASE. Management believes there are a number of
attractive Southeast markets in which to continue to grow the Company's
supermarket base. Jitney-Jungle has a history of successfully making
supermarket acquisitions in both existing and contiguous markets. Since
fiscal l990, Jitney-Jungle has acquired 51 supermarkets in 41 markets,
excluding the 100 supermarkets to be acquired in the Delchamps
Acquisition. In addition, over the past five fiscal years the Company has
built or expanded 58 supermarkets in the Southeast. To continue expanding
its supermarket base, Management intends to open new supermarkets and make
strategic acquisitions in certain of the larger metropolitan areas where
it currently operates (including Memphis and Little Rock), as well as in
smaller cities and surrounding areas that are contiguous to areas where it
currently operates.
- CONTINUE TO IMPROVE OPERATING MARGINS. Jitney-Jungle and Delchamps have
improved their EBITDA margins from 5.5% and 2.9%, respectively, in fiscal
1992 to 5.7% and 4.0%, respectively, in fiscal 1997. The Company
continuously reviews its operations to identify initiatives designed to
reduce operating costs and increase EBITDA margins. As a result of the
following initiatives, Management
5
<PAGE>
believes that the Company can further improve its EBITDA margins during
fiscal 1998: (i) headcount reductions implemented by Jitney-Jungle in May
1997, which are expected to result in annualized cost savings of
approximately $0.9 million in fiscal 1998; and (ii) improved labor
scheduling currently being implemented at Jitney-Jungle supermarkets,
which is expected to result in annualized cost savings of approximately
$3.5 million in fiscal 1998 and which may also result in additional cost
savings when implemented during the next 12 to 18 months at the Delchamps
supermarkets. In addition, Management expects to implement programs at
Delchamps to reduce inventory shrink to levels comparable to those
achieved at Jitney-Jungle.
- DECREASE WORKING CAPITAL NEEDS. During fiscal 1997, Jitney-Jungle
successfully implemented programs to reduce inventories by eliminating
slow moving items, as well as renegotiating its payment terms to bring
them more in line with industry practice. As a result of these efforts,
Jitney-Jungle improved its ratio of accounts payable to inventory from
51.7% in fiscal 1996 to 77.3% in fiscal 1997. Jitney-Jungle believes that
these measures enabled it to decrease its working capital needs by
approximately $20.0 million. Management intends to implement similar
programs at Delchamps.
- CAPITALIZE ON MARKET SEGMENTATION OPPORTUNITIES. The Company attempts to
optimize operating results by selecting a format for each of its
supermarkets that is best suited to a site's demographics, local
preferences and competitive position. The Company's conventional
supermarkets offer a range of departments and high-quality services; the
Company's combination supermarkets offer a combined supermarket and drug
format with a wider variety of premium, full-service departments,
merchandise and services; and the Company's discount supermarkets offer
items throughout the supermarket at everyday low prices and generally
place greater emphasis on self-service. In general, the Company's
conventional and combination supermarkets generate higher operating
margins than its discount supermarkets. Management believes that there is
a growing consumer demand for higher service levels and convenience and,
as a result, expects that the Company will open combination supermarkets
in preference to conventional and discount supermarkets at all sites where
adequate space and consumer demand exist. Management also expects that a
significant number of conventional and discount formats will be converted
to combination formats. In addition, because the Company's discount
supermarkets attract a price sensitive customer who generally would not
shop at a combination or conventional supermarket, Management also
believes there will be opportunities to open new discount supermarkets in
areas where limited or no competing discount supermarkets operate
(including Mobile and New Orleans), with minimal risk of cannibalizing
sales of the Company's conventional and combination supermarkets located
in those areas.
- PURSUE INNOVATIVE MARKET INITIATIVES. The Company's goal is to utilize
innovative marketing and advertising programs to increase sales while
maintaining or increasing profitability. At its conventional and
combination stores, Jitney-Jungle has introduced a frequent shopper
program utilizing a "Gold Card" designed to increase customer traffic and
net sales by offering incentives to its most loyal customers. The
"Gold-Card" entitles holders to discounts on certain products every week
as well as check cashing privileges, and also serves as a base for market
basket analysis and customer-oriented direct marketing. Since the
introduction of the Gold Card, Management believes that the number of
customers and the amount of the average purchase at Jitney-Jungle
supermarkets has increased and, as a result, Management intends to
introduce a similar frequent shopper card at Delchamps supermarkets
following the Delchamps Acquisition. At its discount supermarkets, the
Company employs marketing campaigns designed to appeal to the value
conscious consumer, including "truckload sales," private label promotions
and bulk produce and similar purchasing incentives.
- FOCUS ON "PUMP AND SAVE" GASOLINE STATION OPPORTUNITIES. The Company
operates gasoline stations under the name "Pump And Save" at or near 53 of
its supermarkets that offer attractive gasoline retailing sites on heavily
traveled roads and highways. The Company entered the gasoline business
6
<PAGE>
to take advantage of (i) the low incremental capital costs of building
gasoline stations on its supermarket parking lots and (ii) the
efficiencies associated with operating gasoline stations with the same
management and labor as its supermarkets. The Company has opened 25 new
gasoline stations over the last five fiscal years and plans to continue
this growth with expansion at many of the 100 Delchamps supermarkets.
THE TRANSACTIONS
Pursuant to the terms of an Agreement and Plan of Merger dated as of July 8,
1997 (the "Delchamps Merger Agreement") among the Company, Delchamps and Delta
Acquisition Corporation, an Alabama corporation and a wholly-owned subsidiary of
Jitney-Jungle ("DAC"), on July 14, 1997 DAC commenced a tender offer to purchase
all of the issued and outstanding shares of common stock and associated
preferred share purchase rights of Delchamps (the "Delchamps Tender Offer"). On
September 12, 1997, DAC accepted for payment pursuant to the Delchamps Tender
Offer an aggregate of 5,317,510 such shares and preferred share purchase rights.
Pursuant to the Delchamps Merger Agreement, on November 4, 1997 DAC was merged
with and into Delchamps (the "Delchamps Merger" and, together with the Delchamps
Tender Offer, the "Delchamps Acquisition"). Delchamps was the surviving
corporation in the Delchamps Merger and is now a wholly-owned subsidiary of
Jitney-Jungle. The aggregate consideration expected to be paid in connection
with the Delchamps Acquisition is approximately $218.2 million (the "Delchamps
Purchase Price"). The Existing Notes were issued on September 12, 1997
concurrently with the consummation of the Delchamps Tender Offer.
Upon consummation of the Delchamps Tender Offer, Jitney-Jungle's existing
revolving credit agreement with Fleet Capital Corporation, as successor agent to
Fleet Bank, N.A., and certain other banks was amended and restated to increase
the commitments thereunder from $100.0 million to $150.0 million (as so amended
and restated, the "Senior Credit Facility"), the Company borrowed approximately
$72.7 million thereunder and the Company repaid approximately $15.4 million of
Delchamps' outstanding indebtedness (collectively, the "Refinancing"). See "The
Transactions--The Refinancing."
In order to permit the Delchamps Acquisition and related financings,
Jitney-Jungle solicited and obtained consents (the "Consent Solicitation") from
the holders of a majority in principal amount of its 12% Senior Notes due 2006
(the "Senior Notes") to certain amendments to the indenture governing the Senior
Notes (the "Senior Note Indenture") that, among other things, permit the Company
to issue, and the Subsidiary Guarantors to guarantee, the Notes and increase the
amount of borrowings available under the Senior Credit Facility. In connection
with the Consent Solicitation, the Company paid to the consenting holders of
Senior Notes a consent payment. See "The Transactions--The Consent
Solicitation."
In connection with the Delchamps Acquisition, Management has determined to
close 13 Delchamps supermarkets that are unprofitable or that in other respects
have not performed in accordance with expectations. In addition, Jitney-Jungle
and Delchamps reached a settlement agreement with the Federal Trade Commission
(the "FTC") in order to address FTC concerns about the proposed combination with
respect to certain markets in which Jitney-Jungle and Delchamps have stores, and
pursuant to which Jitney-Jungle and Delchamps have agreed to divest five
Jitney-Jungle stores and five Delchamps stores. These supermarket closings and
divestitures are collectively referred to herein as the "Anticipated Store
Dispositions." See "The Transactions--Expected Store Closures and Divestitures"
and "Pro Forma Condensed Consolidated Financial Statements."
The Delchamps Tender Offer, the Refinancing and the Consent Solicitation,
together with the issuance of the Existing Notes, the initial borrowing under
the Senior Credit Facility, the application of the proceeds thereof and the
payment of related fees and expenses (including fees and expenses relating to
the Consent Solicitation), are collectively referred to herein as the
"Transactions." Information provided herein on a "Pro Forma Basis" gives effect
to the Transactions, the Delchamps Merger and the Anticipated
7
<PAGE>
Store Dispositions. See the Pro Forma Condensed Consolidated Financial
Statements included elsewhere in this Prospectus.
USE OF PROCEEDS
The Company will not receive any proceeds from the Exchange Offer. The gross
proceeds to the Company from the sale of the Existing Notes, together with
initial borrowings by the Company of approximately $72.7 million under the
Senior Credit Facility, were or will be used as follows: (i) approximately
$218.2 million was or will be applied to pay the Delchamps Purchase Price; (ii)
approximately $15.4 million was applied to repay certain of Delchamps'
outstanding indebtedness; (iii) approximately $12.1 million was or will be
applied to make change of control payments to certain Delchamps executives
pursuant to the requirements of existing contractual provisions; and (iv)
approximately $27.0 million was or will be applied to pay the fees and expenses
incurred in connection with the Transactions and the Delchamps Merger.
Approximately $4.6 million of the Delchamps indebtedness which was repaid had a
maturity date of June 1998 and bore interest at a rate equal to LIBOR plus 1.25%
(currently 7.26%) and approximately $10.8 million of the remaining Delchamps
indebtedness had a maturity date of July 2000 and bore interest at a rate of
5.51%.
The following table sets forth the sources and uses of funds in connection
with the Transactions.
<TABLE>
<CAPTION>
(DOLLARS IN
MILLIONS)
<S> <C>
SOURCES OF FUNDS:
10 3/8% Senior Subordinated Notes due 2007.............................. $ 200.0
Senior Credit Facility.................................................. 72.7
------
Total Sources of Funds................................................ $ 272.7
------
------
USES OF FUNDS:
Delchamps Purchase Price................................................ $ 218.2
Repayment of Delchamps' indebtedness.................................... 15.4
Change of control payments.............................................. 12.1
Transaction fees and expenses........................................... 27.0
------
Total Uses of Funds................................................... $ 272.7
------
------
</TABLE>
8
<PAGE>
THE EXCHANGE OFFER
<TABLE>
<S> <C>
Securities Offered........ Up to $200,000,000 aggregate principal amount of 10 3/8% Senior
Subordinated Notes due 2007. The terms of the New Notes and
Existing Notes are identical in all material respects, except
for certain transfer restrictions and registration rights
relating to the Existing Notes.
The Exchange Offer........ The New Notes are being offered in exchange for a like principal
amount of Existing Notes. Existing Notes may be exchanged only
in integral multiples of $1,000. The issuance of the New Notes
is intended to satisfy obligations of the Company contained in
the Registration Rights Agreement.
Expiration Date;
Withdrawal of Tender.... The Exchange Offer will expire at 5:00 p.m., New York City time,
on December 10, 1997, or such later date and time to which it
may be extended by the Company. The tender of Existing Notes
pursuant to the Exchange Offer may be withdrawn at any time
prior to the Expiration Date. Any Existing Notes not accepted
for exchange for any reason will be returned without expense to
the tendering holder thereof as promptly as practicable after
the expiration or termination of the Exchange Offer.
Certain Conditions to the
Exchange Offer.......... The Company's obligation to accept for exchange, or to issue New
Notes in exchange for, any Existing Notes is subject to certain
customary conditions relating to compliance with any applicable
law or any applicable interpretation by the staff of the
Commission, which may be waived by the Company in its reasonable
discretion. The Company currently expects that each of the
conditions will be satisfied and that no waivers will be
necessary. See "The Exchange Offer--Certain Conditions to the
Exchange Offer."
Procedures for Tendering
Existing Notes.......... Each holder of Existing Notes wishing to accept the Exchange
Offer must complete, sign and date the Letter of Transmittal, or
a facsimile thereof, in accordance with the instructions
contained herein and therein, and mail or otherwise deliver such
Letter of Transmittal, or such facsimile, together with such
Existing Notes and any other required documentation, to the
Exchange Agent (as defined) at the address set forth herein. See
"The Exchange Offer--Procedures for Tendering Existing Notes."
Use of Proceeds........... The Company will not receive any proceeds from the Exchange
Offer.
Exchange Agent............ Marine Midland Bank (the "Exchange Agent") is serving as the
Exchange Agent in connection with the Exchange Offer.
Federal Income Tax
Consequences............ The exchange of Notes pursuant to the Exchange Offer should not
be a taxable event for federal income tax purposes. See "Certain
Federal Income Tax Considerations."
</TABLE>
9
<PAGE>
CONSEQUENCES OF EXCHANGING EXISTING NOTES PURSUANT TO THE EXCHANGE OFFER
Based on certain interpretive letters issued by the staff of the Commission
to third parties in unrelated transactions, the Company is of the view that
holders of Existing Notes (other than any holder who is an "affiliate" of the
Company within the meaning of Rule 405 under the Securities Act) who exchange
their Existing Notes for New Notes pursuant to the Exchange Offer generally may
offer such New Notes for resale, resell such New Notes and otherwise transfer
such New Notes without compliance with the registration and prospectus delivery
provisions of the Securities Act, provided such New Notes are acquired in the
ordinary course of the holders' business and such holders have no arrangement
with any person to participate in a distribution of such New Notes. Each
broker-dealer that receives New Notes for its own account in exchange for
Existing Notes must acknowledge that it will deliver a prospectus in connection
with any resale of such New Notes. See "Plan of Distribution." In addition, to
comply with the securities laws of certain jurisdictions, if applicable, the New
Notes may not be offered or sold unless they have been registered or qualified
for sale in such jurisdictions or in compliance with an available exemption from
registration or qualification. The Company has agreed, pursuant to the
Registration Rights Agreement and subject to certain specified limitations
therein, to register or qualify the New Notes for offer or sale under the
securities or blue sky laws of such jurisdictions as any holder of the Notes
reasonably requests in writing. If a holder of Existing Notes does not exchange
such Existing Notes for New Notes pursuant to the Exchange Offer, such Existing
Notes will continue to be subject to the restrictions on transfer contained in
the legend thereon. In general, the Existing Notes may not be offered or sold,
unless registered under the Securities Act, except pursuant to an exemption
from, or in a transaction not subject to, the Securities Act and applicable
state securities laws. Holders of Existing Notes do not have any appraisal or
dissenters' rights under the Mississippi Business Corporation Act in connection
with the Exchange Offer. See "The Exchange Offer--Consequences of Failure to
Exchange; Resales of New Notes."
The Existing Notes are currently eligible for trading in the Private
Offerings, Resales and Trading through Automated Linkages ("PORTAL") market.
Following commencement of the Exchange Offer but prior to its consummation, the
Existing Notes may continue to be traded in the PORTAL market. Following
consummation of the Exchange Offer, the New Notes will not be eligible for
PORTAL trading.
THE NEW NOTES
The terms of the New Notes are identical in all material respects to the
Existing Notes, except for certain transfer restrictions and registration rights
relating to the Existing Notes.
<TABLE>
<S> <C>
Securities Offered.............. $200.0 million in aggregate principal amount of 10 3/8%
Senior Subordinated Notes due 2007.
Maturity........................ September 15, 2007.
Interest Payment Dates.......... March 15 and September 15 of each year, commencing March
15, 1998.
Mandatory Redemption............ The Company will not be required to make mandatory
redemption or sinking fund payments with respect to the
New Notes.
Optional Redemption............. The New Notes (and any outstanding Existing Notes) will be
redeemable at the option of the Company, in whole or in
part, at any time on or after September 15, 2002 at the
redemption prices set forth herein, plus accrued and
unpaid interest and Liquidated Damages (as defined), if
any, to the date of redemption. In addition, at any time
prior to September 15, 2000 the Company may, on one or
more occasions, redeem up to 33 1/3% of the then
outstanding Notes with any of the net proceeds of one or
more public offerings of common stock of the Company at a
redemption price of 110.375% of the principal amount
thereof plus accrued and unpaid interest and Liquidated
Damages, if any, to the applicable
</TABLE>
10
<PAGE>
<TABLE>
<S> <C>
date of redemption; PROVIDED that at least 66 2/3% of the
original principal amount of Notes remain outstanding
immediately after the occurrence of each such redemption.
Change of Control............... In the event of a Change of Control (as defined), each
holder of the Notes will have the right to require the
Company to purchase the Notes held by such holder at a
price equal to 101% of the aggregate principal amount
thereof, plus accrued and unpaid interest and Liquidated
Damages, if any, to the date of purchase.
Ranking......................... The New Notes will be general unsecured obligations of the
Company subordinated in right of payment to all existing
and future Senior Debt of the Company, including
indebtedness pursuant to the Senior Notes and the Senior
Credit Facility. At July 26, 1997, on a Pro Forma Basis,
the aggregate principal amount of outstanding Senior Debt
of the Company would have been approximately $348.1
million (exclusive of an unused commitment of up to $66.1
million under the Senior Credit Facility).
Subsidiary Guarantees........... The New Notes will be guaranteed, jointly and severally,
on a senior subordinated basis by each of the Subsidiary
Guarantors. The Subsidiary Guarantees will be subordinated
in right of payment to all existing and future Senior Debt
of the Subsidiary Guarantors, including the guarantees of
the Subsidiary Guarantors of the Company's obligations
under the Senior Notes and the Senior Credit Facility. At
July 26, 1997, on a Pro Forma Basis, the aggregate
principal amount of outstanding Senior Debt of the
Subsidiary Guarantors would have been approximately $10.4
million (excluding guarantees by the Subsidiary Guarantors
of the Company's obligations under the Senior Notes and
the Senior Credit Facility).
Covenants....................... The Indenture (as defined) contains covenants that, among
other things: (i) limit the incurrence by the Company and
its Restricted Subsidiaries of additional indebtedness;
(ii) limit the issuance by the Company and the Subsidiary
Guarantors of Disqualified Stock (as defined); (iii)
restrict the ability of the Company and its Restricted
Subsidiaries to make dividends and other restricted
payments or investments; (iv) limit the ability of the
Company and its Restricted Subsidiaries to enter into
sale-leaseback transactions; (v) limit transactions by the
Company and its Restricted Subsidiaries with affiliates;
(vi) limit the ability of the Company and its Restricted
Subsidiaries to make asset sales; (vii) limit the ability
of the Company and its Restricted Subsidiaries to incur
certain liens; (viii) limit the ability of the Company to
consolidate or merge with or into, or to transfer all or
substantially all of its assets to, another person; and
(ix) prohibit the Company and the Subsidiary Guarantors
from incurring any indebtedness that is junior to Senior
Debt and senior to the Notes or the Subsidiary Guarantees,
as applicable.
</TABLE>
RISK FACTORS
Holders of Existing Notes should carefully consider all of the information
set forth in this Prospectus and, in particular, should evaluate the specific
factors under "Risk Factors" beginning on page 14 in connection with the
Exchange Offer.
11
<PAGE>
SUMMARY PRO FORMA CONDENSED CONSOLIDATED FINANCIAL AND OTHER DATA
The summary pro forma statement of operations and other data for the LTM
Period and balance sheet data at July 26, 1997 set forth below are calculated on
a Pro Forma Basis, and have been prepared on the basis set forth in, are
qualified in their entirety by reference to, and should be read in conjunction
with, the Pro Forma Condensed Consolidated Financial Statements included
elsewhere in this Prospectus. The summary pro forma statement of operations data
and other data do not purport to represent what the Company's results of
operations would have been if the Transactions, the Delchamps Merger and the
Anticipated Store Dispositions had actually occurred at the beginning of the
period specified nor does such data purport to represent the Company's results
of operations for any future period.
<TABLE>
<CAPTION>
LTM PERIOD
<S> <C>
(DOLLARS IN
THOUSANDS)
STATEMENT OF OPERATIONS DATA:
Net sales................................................................................... $ 2,166,461
Gross profit................................................................................ 564,903
Direct store expense........................................................................ 392,673
Warehouse, administrative and general expenses.............................................. 95,462
Special charges, net(1)..................................................................... 4,957
-----------
Operating income............................................................................ 71,811
Interest expense, net....................................................................... 67,484
-----------
Earnings before income taxes................................................................ 4,327
Income taxes................................................................................ 3,260
-----------
Net earnings................................................................................ $ 1,067
-----------
-----------
OTHER DATA:
EBITDA(2)................................................................................... $ 127,800
Depreciation and amortization............................................................... 51,632
LIFO benefit................................................................................ (600)
Capital expenditures........................................................................ 38,513
Supermarkets open at end of period.......................................................... 199
Remodels during period...................................................................... 17
Gross profit as a percentage of sales....................................................... 26.1%
EBITDA as a percentage of sales............................................................. 5.9%
Ratio of EBITDA to cash interest expense(3)................................................. 2.0x
Ratio of net debt to EBITDA(4).............................................................. 4.3x
</TABLE>
<TABLE>
<CAPTION>
PRO FORMA
AT JULY 26,
1997
<S> <C>
BALANCE SHEET DATA:
Cash and cash equivalents........................................................................ $ 14,761
Working capital.................................................................................. 38,829
Total assets..................................................................................... 698,054
Total debt....................................................................................... 558,461
Other long-term liabilities, including current portion........................................... 67,827
Stockholders' deficit............................................................................ (154,328)
</TABLE>
- ------------------------
(1) Includes (i) a $1.8 million non-cash charge accrued in fiscal 1997 relating
to future payments that will be made under an employment agreement with
Jitney-Jungle's former Chief Executive Officer; (ii) a $1.0 million charge
relating to termination benefits payable to employees of Jitney-Jungle whose
positions were eliminated in May 1997; (iii) a $4.3 million charge relating
to cash payments made by Delchamps in connection the settlement of a lawsuit
in March 1997; and (iv) a $2.1 million gain on the sale of certain assets of
Delchamps in fiscal 1997.
12
<PAGE>
SUMMARY PRO FORMA CONDENSED CONSOLIDATED FINANCIAL AND OTHER DATA
(2) EBITDA is defined as income from continuing operations before interest,
taxes, depreciation, amortization, LIFO expense (benefit) and special items,
net. EBITDA is presented because it is a widely accepted financial indicator
of a company's ability to service indebtedness. However, EBITDA should not
be considered as an alternative to income from operations or to cash flows
from operating activities (as determined in accordance with generally
accepted accounting principles) and should not be construed as an indication
of a company's operating performance or as a measure of liquidity. EBITDA
reflects $14.2 million of anticipated cash cost savings which Management has
identified related to the elimination of duplicative costs for functional
areas and facilities which are based on assumptions that Management believes
are factually supportable and directly related to the Delchamps Acquisition.
EBITDA does not include an additional $5.2 million of estimated cash cost
savings that Management believes may occur as a result of increased
purchasing leverage and backhaul income. The components of these estimated
cash cost savings are set forth in the notes to the Pro Forma Condensed
Consolidated Statements of Operations and Other Data included elsewhere in
this Prospectus and are summarized as follows (in millions):
<TABLE>
<S> <C>
ANTICIPATED CASH COST SAVINGS REFLECTED IN THE PRO FORMA STATEMENT OF
OPERATIONS AND OTHER DATA:
Reduced general and administrative expenses................................ $ 9.3
Improved warehousing and distribution efficiencies......................... 3.9
Reduced advertising and printing expenses.................................. 1.0
---------
Total.................................................................... $ 14.2
---------
---------
ADDITIONAL POTENTIAL CASH COST SAVINGS:
Increased purchasing leverage.............................................. $ 3.4
Increased backhaul income.................................................. 1.8
---------
Total.................................................................... $ 5.2
---------
---------
Total estimated cash cost savings............................................ $ 19.4
---------
---------
</TABLE>
(3) Cash interest expense excludes $2.8 million of amortization of deferred
financing fees.
(4) Represents the ratio of (i) pro forma indebtedness less pro forma cash as of
July 26, 1997 to (ii) pro forma EBITDA for the LTM Period.
13
<PAGE>
RISK FACTORS
Holders of Existing Notes should carefully consider the specific factors set
forth below as well as the other information included in this Prospectus in
connection with the Exchange Offer. The risk factors set forth below are
generally applicable to the Existing Notes as well as the New Notes.
THIS PROSPECTUS INCLUDES "FORWARD LOOKING STATEMENTS" WITHIN THE MEANING OF
SECTION 27A OF THE SECURITIES ACT AND SECTION 21E OF THE EXCHANGE ACT. ALTHOUGH
JITNEY-JUNGLE BELIEVES THAT ITS PLANS, INTENTIONS AND EXPECTATIONS REFLECTED IN
SUCH FORWARD-LOOKING STATEMENTS ARE REASONABLE, IT CAN GIVE NO ASSURANCE THAT
SUCH PLANS, INTENTIONS OR EXPECTATIONS WILL BE ACHIEVED. IMPORTANT FACTORS THAT
COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM JITNEY-JUNGLE'S FORWARD
LOOKING STATEMENTS ARE SET FORTH BELOW AND ELSEWHERE IN THIS PROSPECTUS. ALL
FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO JITNEY-JUNGLE OR PERSONS ACTING ON
ITS BEHALF ARE EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY THE CAUTIONARY
STATEMENTS SET FORTH BELOW.
INTEGRATION OF DELCHAMPS
The integration of the administrative, finance and other operations of
Delchamps with those of Jitney-Jungle, the coordination of Delchamps' sales and
marketing organizations with those of Jitney-Jungle and the implementation of
appropriate operational, financial and management systems and controls in
connection with the Delchamps Acquisition will require significant financial
resources and substantial attention from Management, and could result in the
diversion of such resources and attention from the core businesses of
Jitney-Jungle and Delchamps. Specifically, Jitney-Jungle's supermarket base will
nearly double as a result of the Delchamps Acquisition and Management expects
that the coordination of purchasing and distribution and warehousing for the
combined operations following the Delchamps Acquisition will be a significant
focus of Management. In addition, Jitney-Jungle's business plan with respect to
the combined operations of the Company following the Delchamps Acquisition
contemplates anticipated cash cost savings that are expected to result from (i)
reduced general and administrative expenses arising from the closure of the
corporate headquarters of Delchamps and associated headcount reductions, (ii)
improved warehouse and distribution efficiencies, (iii) reduced advertising and
printing expenses resulting from moving a portion of Delchamps' print
advertising needs to Jitney-Jungle's in-house printing facilities, (iv)
increased purchasing leverage that may enable the Company to negotiate more
favorable terms from its vendors, and (v) increased backhaul income. Of the
aggregate potential $19.4 million in such annualized cash cost savings,
approximately $14.2 million are reflected in the Pro Forma Condensed
Consolidated Financial Statements included elsewhere herein because Management
believes they are factually supportable and directly related to the Transactions
and the Delchamps Merger. In addition, certain marketing and cost saving
initiatives undertaken at Jitney-Jungle prior to the Delchamps Acquisition will
be extended to the Delchamps supermarkets, including introduction of a "frequent
shopper card" and implementation of improved labor scheduling, in each case, at
the acquired Delchamps supermarkets. The potential cash cost savings discussed
above are based on estimates prepared solely by members of Management based on
information available to them and have not been independently reviewed. The
estimates necessarily make assumptions as to future events, including general
industry, competitive and business conditions, many of which are beyond the
control of the Company. Actual cash cost savings achieved by the Company may
vary considerably from the estimates discussed above. Any inability of the
Company to integrate Delchamps successfully or to achieve the cash cost savings
described above in a timely and efficient manner could adversely affect the
Company's financial condition and results of operations.
SUBSTANTIAL LEVERAGE
The Company is highly leveraged and its debt instruments contain and will
continue to contain restrictions on its operations. See "Description of Certain
Indebtedness" and "Description of the Notes." At July 26, 1997, on a Pro Forma
Basis, the Company would have had approximately $558.5 million of total debt
(including capitalized leases and current installments) and a shareholders'
deficit of approximately
14
<PAGE>
$154.3 million. On a Pro Forma Basis, the Company's ratio of earnings to fixed
charges would have been 1.1 to 1 for the LTM Period.
The significant indebtedness of the Company will have several important
consequences to the holders of the Notes, including, but not limited to, the
following: (i) a substantial portion of the Company's cash flow from operations
must be dedicated to the payment of principal and interest with respect to the
indebtedness under the Senior Credit Facility, the Senior Notes and the Notes;
(ii) indebtedness under the Senior Credit Facility and the Senior Notes will
become due prior to the time the Notes will become due and may adversely affect
the Company's ability to pay principal of and interest when due on the Notes;
(iii) indebtedness under the Senior Credit Facility will bear interest at
fluctuating rates, and a substantial increase in interest rates could adversely
affect the Company's ability to meet its debt service obligations; (iv) the
Company's ability to obtain additional financing in the future for working
capital, capital expenditures, acquisitions or other purposes may be impaired;
(v) the Company's flexibility may be limited in responding to changes in the
industry and economic conditions generally; (vi) the Senior Credit Facility, the
Senior Note Indenture, the Indenture and other agreements of the Company related
to its indebtedness contain numerous financial and other restrictive covenants,
the failure to comply with which may result in an event of default, which, if
not cured or waived, could have a material adverse effect on the Company; and
(vii) the ability of the Company to satisfy its obligations pursuant to such
indebtedness will be dependent upon its future performance which, in turn, will
be subject to management, financial, competitive and other factors affecting the
business and operations of the Company, some of which are beyond the control of
the Company. See "Pro Forma Condensed Consolidated Financial Statements," "Pro
Forma Liquidity," "Selected Historical Financial Data of Jitney-Jungle,"
"Management's Discussion and Analysis of Financial Condition and Results of
Operations of Jitney-Jungle," "Selected Historical Financial Data of Delchamps"
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations of Delchamps."
If the Company is unable to generate sufficient cash flow to meet its debt
obligations, the Company may be required to renegotiate the payment terms or to
refinance all or a portion of the Senior Credit Facility, the Senior Notes or
the Notes, to sell assets or to obtain additional financing. If the Company
could not successfully refinance its indebtedness, substantially all of the
Company's long-term debt would be in default and could be declared immediately
due and payable. Furthermore, the Senior Credit Facility, the Senior Note
Indenture and the Indenture contain numerous financial and operating covenants,
including, among others, covenants requiring the Company to maintain certain
leverage, interest coverage and fixed charge coverage ratios and restricting the
ability of the Company and its subsidiaries to incur indebtedness or to create
or suffer to exist certain liens. The ability of the Company to comply with such
provisions may be affected by events beyond its control. In the event the
Company fails to comply with these covenants, it could be in default under the
Senior Credit Facility, the Senior Note Indenture and/or the Indenture. In the
event of such default, substantially all of the Company's long-term debt could
be declared immediately due and payable. See "Description of Certain
Indebtedness" and "Description of the Notes."
SUBORDINATION AND RANKING OF THE NOTES
The New Notes, like the Existing Notes, will be general unsecured
obligations of the Company subordinated in right of payment to all existing and
future Senior Debt of the Company, including indebtedness pursuant to the Senior
Notes and the Senior Credit Facility. By reason of such subordination, in the
event of an insolvency, liquidation, reorganization, dissolution or other
winding-up of the Company, the Senior Debt must be paid in full before the
principal of, premium, if any, and interest or Liquidated Damages, if any, on
the Notes may be paid. At July 26, 1997, on a Pro Forma Basis, the aggregate
principal amount of outstanding Senior Debt of the Company would have been
approximately $348.1 million (exclusive of an unused commitment of up to $66.1
million under the Senior Credit Facility). If the Company incurs any additional
PARI PASSU DEBT, the holders of such debt would be entitled to share ratably
15
<PAGE>
with the holders of the Notes in any proceeds distributed in connection with any
insolvency, liquidation, reorganization, dissolution or other winding up of the
Company. This may have the effect of reducing the amount of proceeds paid to
holders of the Notes. The Indenture permits the Company to incur additional
Senior Debt or PARI PASSU debt if certain conditions are met. See "Pro Forma
Capitalization," "Description of Certain Indebtedness" and "Description of the
Notes--Certain Covenants."
In addition, certain holders of Senior Debt may prevent cash payments with
respect to the principal of, premium, if any, and interest or Liquidated
Damages, if any, on the Notes for a period of up to 179 days following a
non-payment default with respect to Senior Debt. In addition, the Indenture
permits the subsidiaries of the Company to incur debt under certain
circumstances. Any such debt incurred by a subsidiary of the Company that is not
a Subsidiary Guarantor would be structurally senior to the Notes. All of the
Company's subsidiaries are Subsidiary Guarantors with respect to the Notes. The
guarantee of the Notes by each Subsidiary Guarantor is subordinated in right of
payment to the Senior Debt of such Subsidiary Guarantor on substantially the
same terms as the Notes are subordinated to the Senior Debt of the Company. See
"Description of the Notes--Subordination."
COMPETITION
The supermarket industry is highly competitive and characterized by narrow
profit margins. The Company's competitors include national and regional
supermarket chains, independent and specialty grocers, drug and convenience
stores, and the newer "alternative format" food stores, including warehouse club
stores, deep discount drug stores and "Supercenters;" in certain areas, the
Company also competes with military commissaries. Supermarket chains generally
compete on the basis of location, quality of products, service, price, product
variety and store condition. During the past three years, an overall lack of
inflation in food prices and increasingly competitive markets have made it
difficult for the Company and other supermarket operators to achieve comparable
store sales gains. Because sales growth has been difficult to attain, many
operators, including the Company, have attempted to maintain market share
through increased levels of promotional activities and discount pricing,
creating a more difficult environment in which to increase year-over-year sales
gains consistently. In addition, because of the growth in the Southeast market,
where all of the Company's supermarkets are located, many existing operators,
including the Company, have opened new supermarkets in existing markets which
has resulted in declines in same store sales for the existing (comparable) store
base of these same grocery chains. The Company regularly monitors its
competitors' prices and adjusts its prices and marketing strategy as Management
deems appropriate in light of existing conditions. The Company faces increased
competitive pressure in all of its markets, including Jackson, Mississippi and
Mobile, Alabama where it has historically held leading market positions, from
existing competitors and from the threatened entry by one or more major new
competitors. Some of the Company's competitors have greater financial resources
and could use these resources to take measures which could adversely affect the
Company's competitive position. See "Business--Markets and Competition."
RISK OF INABILITY TO SATISFY CHANGE OF CONTROL OFFER
Upon the occurrence of a "Change of Control," the Company will be required
to make an offer to purchase all of the outstanding Notes at a purchase price in
cash equal to 101% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date of purchase. See
"Description of the Notes--Repurchase at the Option of Holders--Change of
Control" for the definition of "Change of Control." There can be no assurance
that the Company will have the funds necessary to effect such a purchase if such
an event were to occur. In addition, the Senior Credit Facility would prohibit,
and the Senior Notes would restrict, the Company from purchasing any Notes. The
Senior Credit Facility also provides that certain changes in control of the
Company would constitute a default thereunder. Any future credit agreements or
other agreements relating to Senior Debt to which the Company becomes a party
may contain similar restrictions and provisions. In the event a Change of
16
<PAGE>
Control occurs at a time when the Company is prohibited from purchasing Notes,
the Company could seek the consent of its lenders to purchase the Notes or could
attempt to refinance the borrowings that contain such prohibition. If the
Company does not obtain such a consent or repay such borrowings, the Company
will remain prohibited from purchasing Notes. In such case, the Company's
failure to purchase tendered Notes would constitute an Event of Default under
the Indenture, which would cause a default under the Senior Credit Facility and
the Senior Notes. In such circumstances, the subordination provisions in the
Notes would likely restrict payments to the holders of the Notes. See
"Description of the Notes."
RISKS RELATING TO FUTURE ACQUISITIONS
The Company's future growth is dependent, in part, on its ability to
consummate additional supermarket acquisitions. There can be no assurance,
however, that the Company will be able to identify additional acquisitions or
that, if consummated, any anticipated benefits will be realized from such
acquisitions. Moreover, future acquisitions by the Company could result in the
incurrence of additional indebtedness, exposure to contingent liabilities and
the amortization of expenses related to goodwill and other intangible assets,
all of which could adversely affect the Company's financial condition and
results of operations.
SUBSIDIARY GUARANTEES
The holders of the Notes will have no direct claims against the subsidiaries
of the Company other than the claim created by the Subsidiary Guarantees. The
Subsidiary Guarantees are subordinated in right of payment to all existing and
future Senior Debt of the Subsidiary Guarantors, including the guarantees of the
Subsidiary Guarantors of the Company's obligations under the Senior Notes and
the Senior Credit Facility. At July 26, 1997, on a Pro Forma Basis, the
aggregate principal amount of outstanding Senior Debt of the Subsidiary
Guarantors would have been approximately $10.4 million (excluding guarantees by
the Subsidiary Guarantors of the Company's obligations under the Senior Notes
and the Senior Credit Facility). See "Description of Certain Indebtedness." In
addition, the Subsidiary Guarantees may be subject to legal challenge under
applicable provisions of the United States Bankruptcy Code or comparable
provisions of state fraudulent transfer or conveyance laws. If such a challenge
were upheld, the Subsidiary Guarantees would be invalidated and unenforceable
and it is possible that holders of the Notes would be ordered by a court to turn
over to other creditors of the Subsidiary Guarantors or to their trustees in
bankruptcy all or a portion of the payments made to them pursuant to the
Subsidiary Guarantees. To the extent that the Subsidiary Guarantees are not
enforceable in amounts sufficient to satisfy the claims of the holders of the
Notes, the rights of holders of the Notes to participate in any distribution of
assets of any Subsidiary Guarantors upon liquidation, bankruptcy, reorganization
or otherwise would be subject to prior claims of creditors of that Guarantor.
GEOGRAPHIC CONCENTRATION
All of the Company's supermarkets are located in the Southeast region, with
a strong concentration in Mississippi and Alabama, and thus the performance of
the Company will be particularly influenced by the economic and demographic
trends in this area. Although the Southeast region has experienced economic and
demographic growth over the past several years, a significant economic downturn
in the region could have a material adverse effect on the Company.
RELIANCE ON KEY MANAGEMENT
The Company's success depends to a significant degree upon the continued
contributions of Management as well as the Company's sales and marketing,
finance and manufacturing personnel, certain of whom would be difficult to
replace. The loss of the services of certain of these executives could have an
adverse effect on the Company. Although certain of these executives are
shareholders of Jitney-Jungle and have employment contracts with the Company,
there can be no assurance that the services of such personnel will continue to
be available to the Company. See "Management" and "Ownership of Capital Stock."
17
<PAGE>
ENVIRONMENTAL RISKS
The Company is subject to federal, state and local laws and regulations
including those relating to environmental protection, work place safety, public
health and community right-to-know. The Company's supermarkets are not highly
regulated under environmental laws since the Company does not engage in any
industrial activities at those locations. The Company's expenditures to comply
with such laws and regulations at its supermarkets primarily consist of those
related to retrofitting chlorofluorocarbon ("CFC") chiller units. In addition,
56 of the Company's facilities (including all 53 of the Pump And Save
facilities) and one former facility for which the Company has retained
responsibility, contain or contained underground tanks for the storage of
petroleum products, such as gasoline and diesel fuel. The Company maintains an
environmental compliance program that includes the implementation of required
technical and operational activities designed to minimize the potential for
leaks and spills, maintenance of records and the regular testing and monitoring
of tank systems for tightness. There can be no assurance, however, that these
tank systems will at all times remain free from leaks or that the use of these
tanks will not result in spills. Sixteen of the facilities have had leaks or
spills, 12 of which were related to underground or above-ground petroleum
storage tanks and four of which were unrelated to tank storage. All of such
leaks or spills have been or are being responded to in conjunction with the
appropriate regulatory agencies. Historically, none of the 16 locations which
have had leaks or spills have required expenditures that would have had a
material effect on the results of operations, liquidity or financial condition
of the Company. All significant required expenditures in connection with the
clean up of such leaks and spills have been made at these 16 sites, except at
three newly discovered locations which are still undergoing investigation and
one location awaiting state approval of its remediation plan. Any future leak or
spill, depending on such factors as the material involved, quantity,
environmental setting and availability of state clean-up funds, could result in
response activities that could interrupt the Company's operations and could
result in costs to the Company that could have a material adverse effect on the
Company. In addition, there can be no assurance that future environmental
legislation and regulation will not require material expenditures by the Company
or otherwise have a material adverse effect on the Company's operations. See
"Business-- Environmental Matters."
CONTROL BY BRS
Approximately 71%, on a fully diluted basis, of the outstanding shares of
Jitney-Jungle's common stock is held by Bruckmann, Rosser, Sherrill & Co., L.P.
(the "Fund") and certain related investors (collectively, the "Fund Entities").
As a result, the Fund controls Jitney-Jungle and has the power to elect a
majority of its directors, appoint new management and approve any action
requiring the approval of shareholders, including adopting certain amendments to
Jitney-Jungle's articles of incorporation and approving mergers or sales of
substantially all of Jitney-Jungle's assets. The directors elected by the Fund
will have the authority to effect decisions affecting the capital structure of
Jitney-Jungle including the issuance of additional capital stock, the
implementation of stock repurchase programs and the declaration of dividends.
See "Ownership of Capital Stock."
FRAUDULENT CONVEYANCE CONSIDERATIONS
Under applicable provisions of the United States Bankruptcy Code or
comparable provisions of state fraudulent transfer or conveyance law, if, at the
time it issued the Existing Notes, the Company (a) incurred such indebtedness
with intent to hinder, delay or defraud creditors, or (b)(i) received less than
reasonably equivalent value or fair consideration therefor and (ii)(A) was
insolvent at the time of the incurrence, (B) was rendered insolvent by reason of
such incurrence (and the application of the proceeds thereof), (C) was engaged
or was about to engage in a business or transaction for which the assets
remaining with the Company constituted unreasonably small capital to carry on
its business, or (D) intended to incur, or believed that it would incur, debts
beyond its ability to pay such debts as they mature, then, in each such case, a
court of competent jurisdiction could void, in whole or in part, the Notes
18
<PAGE>
or, in the alternative, subordinate the Notes to existing and future
indebtedness of the Company. The measure of insolvency for purposes of the
foregoing will vary depending upon the law applied in such case. Generally,
however, the Company would be considered insolvent if the sum of its debts,
taking contingent liabilities into account, was greater than all of its assets
at fair valuation or if the present fair saleable value of its assets was less
than the amount that would be required to pay the probable liability on its
existing debts, including contingent liabilities, as they become absolute and
matured. Under Mississippi fraudulent conveyance law, a transaction may be set
aside for lack of consideration, regardless of the solvency of the parties.
For purposes of the United States Bankruptcy Code and state fraudulent
transfer or conveyance laws, Management believes that (i) indebtedness under the
Existing Notes was incurred without the intent to hinder, delay or defraud
creditors and for proper purposes and in good faith, (ii) the Company received
reasonably equivalent value or fair consideration, and (iii) based on forecasts,
asset valuations and other financial information, the Company, after
consummation of the Transactions and the Delchamps Merger, including the
incurrence of indebtedness under the Existing Notes and the application of the
proceeds thereof, will be solvent, did and will have sufficient capital for
carrying on its business and will be able to pay its debts as they mature. There
can be no assurance, however, that a court passing on such questions would agree
with Management's view.
ABSENCE OF PUBLIC MARKET FOR THE NOTES
The Existing Notes currently are eligible for trading in the PORTAL Market.
The New Notes are new securities for which there is currently no established
market. The Company does not intend to list the New Notes on any national
securities exchange or to seek the admission thereof to trading in the National
Association of Securities Dealers Automated Quotation System. The Initial
Purchasers have advised the Company that they currently intend to make a market
in the New Notes but that they are not obligated to do so and any such market
making may be discontinued at any time. There can be no assurance as to the
development of any market or the liquidity of any market that may develop for
the New Notes. If an active public market does not develop, the market, price
and liquidity of the New Notes may be adversely affected. Future trading prices
of the New Notes will depend on prevailing interest rates, the market for
similar securities and other factors, including general economic conditions and
the financial condition and performance of the Company. Holders of the New Notes
should be aware that they may be required to bear the financial risks of their
investment for an indefinite period of time. See "Description of the Notes."
19
<PAGE>
THE TRANSACTIONS
Concurrently with the Delchamps Tender Offer, Management consummated the
Transactions, including the sale of the Existing Notes, the amendment and
restatement of the Senior Credit Facility and the initial borrowing thereunder,
the repayment of approximately $15.4 million of indebtedness of Delchamps and
the Consent Solicitation pursuant to which certain amendments to the Senior Note
Indenture were approved by the holders of the Senior Notes.
THE DELCHAMPS ACQUISITION
Pursuant to the terms of the Delchamps Merger Agreement, on July 14, 1997
DAC commenced the Delchamps Tender Offer to purchase all of the issued and
outstanding shares of common stock, par value $.01 per share, and associated
preferred share purchase rights of Delchamps (collectively, "Shares"). On
September 12, 1997, DAC accepted for payment pursuant to the Delchamps Tender
Offer an aggregate of 5,317,510 Shares. Pursuant to the Delchamps Merger
Agreement, on November 4, 1997 DAC was merged with and into Delchamps in
accordance with the relevant provisions of the Alabama Business Corporation Act
("ABCA"), the separate corporate existence of DAC ceased and Delchamps became a
wholly-owned subsidiary of Jitney-Jungle. The aggregate Delchamps Purchase Price
is expected to be approximately $218.2 million.
THE REFINANCING
Upon consummation of the Delchamps Tender Offer, Jitney-Jungle's existing
revolving credit agreement with Fleet Capital Corporation, as successor agent to
Fleet Bank, N.A., and certain other banks was amended and restated to provide
for up to $150.0 million of revolving loans under the Senior Credit Facility,
the Company borrowed approximately $72.7 million thereunder and the Company
repaid approximately $15.4 million of Delchamps' outstanding indebtedness.
THE CONSENT SOLICITATION
In order to permit the Delchamps Acquisition and related financings,
Jitney-Jungle consummated the Consent Solicitation and obtained from holders of
its Senior Notes approval of certain amendments to the Senior Note Indenture
that, among other things, permit the Company to issue, and the Subsidiary
Guarantors to guarantee, the Notes and increase the amount of borrowings
available under the Senior Credit Facility. In connection with the Consent
Solicitation, the Company paid to the consenting holders of Senior Notes a
consent payment.
EXPECTED STORE CLOSURES AND DIVESTITURES
In connection with the Delchamps Acquisition, Management has determined to
close 13 Delchamps supermarkets that are unprofitable or that in other respects
have not performed in accordance with expectations. Seven of such stores are
located in Alabama, four are located in Louisiana, one is located in Florida and
one is located in Mississippi.
In connection with the Delchamps Acquisition, Jitney-Jungle received a
request for additional information from the FTC under the Hart-Scott-Rodino
Antitrust Improvement Act of 1976, as amended (the "HSR Act"). As a result of
negotiations with the staff of the FTC which addressed the FTC's concerns about
the proposed combination with respect to certain markets in which Jitney-Jungle
and Delchamps have stores, Jitney-Jungle and Delchamps reached a settlement
agreement with the FTC. Pursuant to the terms of the settlement agreement, the
FTC terminated the waiting period imposed by the HSR Act, and Jitney-Jungle and
Delchamps agreed under the terms of a proposed consent agreement to divest five
Jitney-Jungle stores and five Delchamps stores to SUPERVALU, Inc. ("SUPERVALU")
by February 12, 1998 or one month after the consent agreement becomes effective,
whichever is later. The consent agreement is subject to a final FTC approval
following a 60 day public notice period. The five Delchamps
20
<PAGE>
stores are located in Hancock, Harrison, Lamar and Forrest Counties,
Mississippi. The aggregate proposed purchase price for the five Delchamps'
stores will be the sum of the purchase price for the merchandise as determined
by a physical inventory and the purchase price for the equipment of $725,000,
subject to certain adjustments. The proposed consent agreement would require
Jitney-Jungle and Delchamps, for ten years, to notify the FTC before acquiring
any supermarkets in Hancock, Jackson, Lamar, Forrest and Warren Counties,
Mississippi and Escambia County in Florida. Jitney-Jungle and Delchamps would
also be prohibited from attempting to restrict the ability of others to operate
any supermarket they formerly owned in those counties.
The Pro Forma Condensed Consolidated Financial Statements contained
elsewhere in this Prospectus contemplate, in connection with the settlement
agreement reached with the FTC, the sale by Jitney-Jungle of an aggregate of ten
stores currently operated by Jitney-Jungle and Delchamps. This pro forma
adjustment is solely for illustrative purposes and may not represent the actual
number of stores finally approved by the FTC for divestment pursuant to the
proposed consent agreement among Jitney-Jungle, Delchamps and SUPERVALU. See
"Pro Forma Condensed Consolidated Financial Statements."
21
<PAGE>
PRO FORMA CAPITALIZATION
The following table sets forth the unaudited pro forma cash and cash
equivalents and pro forma capitalization of the Company at July 26, 1997, on a
Pro Forma Basis. The pro forma data set forth in this table may not be
indicative of the actual cash and cash equivalents or capitalization that would
have occurred had the Transactions and the Delchamps Merger in fact occurred on
the date specified. This table should be read in conjunction with "Pro Forma
Condensed Consolidated Financial Statements" and the notes thereto,
"Management's Discussion and Analysis of Financial Condition and Results of
Operations of Jitney-Jungle," "Management's Discussion and Analysis of Financial
Condition and Results of Operations of Delchamps" and the historical financial
statements of Jitney-Jungle and Delchamps and the notes thereto included
elsewhere in this Prospectus.
<TABLE>
<CAPTION>
AT JULY 26, 1997
(DOLLARS IN
THOUSANDS)
<S> <C>
Cash and cash equivalents................................................................... $ 14,761
----------
----------
Long-term debt, including current portion:
Senior Credit Facility(1)................................................................. $ 72,700
Senior Notes.............................................................................. 200,000
10 3/8% Senior Subordinated Notes due 2007................................................ 200,000
Capitalized lease obligations............................................................. 73,962
Other long-term debt...................................................................... 11,799
----------
Total debt.............................................................................. 558,461
Mandatorily redeemable preferred stock:
225,000 shares Class A Preferred Stock authorized, par value $.01 per share, 225,000
shares outstanding; 275,000 shares Class B Preferred Stock authorized, par value $.01
per share, 274,460.24 shares outstanding; 23,958.33 shares Class C Preferred Stock,
Series 2 authorized, par value $.01 per share, 23,958.33 shares outstanding............. 59,508
----------
Stockholders' deficit:
76,041.67 shares Class C Preferred Stock, Series 1 authorized, par value $.01 per share,
76,041.67 shares outstanding............................................................ 8,663
5,000,000 shares Common Stock authorized, par value $.01 per share, 425,000 shares
outstanding............................................................................. 4
Additional paid-in capital................................................................ (302,326)
Retained earnings......................................................................... 139,331
----------
Total stockholders' deficit............................................................. (154,328)
----------
Total capitalization........................................................................ $ 463,641
----------
----------
</TABLE>
- ------------------------
(1) Excludes $10.5 million of letters of credit issued under the Senior Credit
Facility and $0.7 million of letters of credit issued under the Senior
Credit Facility upon consummation of the Transactions.
22
<PAGE>
PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The following Pro Forma Condensed Consolidated Balance Sheet is based on the
historical balance sheet of Jitney-Jungle at July 26, 1997 and of Delchamps at
June 28, 1997 and was prepared as if the Transactions, the Delchamps Merger and
the Anticipated Store Dispositions had occurred on July 26, 1997. The Delchamps
Acquisition will be accounted for as a purchase, and the total purchase price
will be allocated to Delchamps' tangible and intangible assets and liabilities
based on their estimated fair values at the closing date of the acquisition,
based on valuations and studies which have not yet been performed. Accordingly,
the excess of the purchase price over the historical book value of the net
assets to be acquired has not yet been allocated to individual assets and
liabilities other than the amounts described in the notes to the Pro Forma
Condensed Consolidated Financial Statements. Any variation between such amounts
and the final allocation will change the amount of goodwill recognized in
connection with the Delchamps Acquisition and the related amortization expense.
Management believes, however, that when the final valuation of the net assets
acquired is completed, the allocation of the purchase price will not differ
materially from the amounts shown herein.
The following Pro Forma Condensed Consolidated Statements of Operations and
Other Data for the fiscal year ended May 3, 1997, the 12 weeks ended July 20,
1996, the 12 weeks ended July 26, 1997 and the LTM Period include (i) the
historical results of Jitney-Jungle for the fiscal year ended May 3, 1997 and of
Delchamps for the fiscal year ended June 28, 1997, (ii) the historical results
of Jitney-Jungle for the 12 weeks ended July 20, 1996 and of Delchamps for the
13 weeks ended June 29, 1996, (iii) the historical results of Jitney-Jungle for
the 12 weeks ended July 26, 1997 and of Delchamps for the 13 weeks ended June
28, 1997, and (iv) the historical results of Jitney-Jungle for the 53 weeks
ended July 26, 1997 and of Delchamps for the fiscal year ended June 28, 1997.
Each of these pro forma statements was prepared as if the Transactions, the
Delchamps Merger and the Anticipated Store Dispositions had occurred on April
28, 1996. These pro forma statements reflect certain cost savings that
Management has identified related to the elimination of duplicative costs for
functional areas and facilities in connection with the Delchamps Acquisition
which are based on assumptions that Management believes are both factually
supportable and directly related to the Transactions and the Delchamps Merger.
However, these pro forma statements do not reflect certain additional potential
cost savings described in Note (D) to the Pro Forma Condensed Consolidated
Statements of Operations and Other Data that Management believes should arise as
a result of expected synergies from increased purchasing leverage and backhaul
income. Actual cost savings achieved by the Company may vary considerably from
the estimates discussed above. See "Risk Factors-- Integration of Delchamps."
These pro forma statements also do not reflect (i) a $2.0 million charge
relating to the write-off of commitment fees paid in connection with a bridge
commitment obtained to fund the Delchamps Purchase Price if the sale of the
Existing Notes was not consummated, (ii) approximately $1.4 million of deferred
financing fees relating to Jitney-Jungle's existing credit facility that was
written off in connection with the Transactions and (iii) the estimated loss of
$1.2 million relating to the expected divestiture of certain Jitney-Jungle
stores under an FTC consent decree. Such charges will be recognized by the
Company and reflected in its results of operations in the quarter in which the
Transactions are consummated.
The pro forma financial statements have been prepared by applying to the
historical financial statements of Jitney-Jungle and Delchamps the assumptions
and adjustments described in the accompanying notes. Such pro forma financial
statements are not necessarily indicative of either future results of operations
or results that might have occurred had the Transactions, the Delchamps Merger
and the Anticipated Store Dispositions been consummated as of the indicated
date. Such pro forma financial statements should be read in conjunction with the
Consolidated Financial Statements of Jitney-Jungle and Delchamps and the
respective accompanying notes thereto included elsewhere in this Prospectus.
23
<PAGE>
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
AT JULY 26, 1997
------------------------------------------------------------------------------------------------
COMPANY PRO
HISTORICAL FORMA FOR FTC
-------------------------- PRO FORMA ADJUSTMENTS COMPANY PRO DIVESTITURES
ASSETS JITNEY-JUNGLE DELCHAMPS COMBINED FORMA (H)
------------- ----------- ----------- ---------------------- -------------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents....... $ 5,255 $ 5,670 $ 10,925 $ 67,840 (A) $ 10,886 $ 14,761
190,420 (B)
(2,000) (C)
(7,500) (D)
(233,360) (E)
(15,439) (F)
Receivables..................... 7,423 7,961 15,384 15,384 15,384
Inventories..................... 77,694 89,726 167,420 14,171 (E) 181,591 181,591
Prepaid expenses and other...... 6,507 2,094 8,601 8,601 8,601
Deferred income taxes........... 2,152 6,525 8,677 760 (C) 12,178 13,234
(3,517) (E)
44 (E)
5,665 (E)
549 (G)
------------- ----------- ----------- ----------- -------------- ---------------
Total current assets.......... 99,031 111,976 211,007 17,633 228,640 233,571
Property and equipment, net....... 169,168 129,319 298,487 (4,260) (E) 294,227 287,575
Goodwill.......................... 136,672 (E) 136,672 137,632
Other assets, net................. 16,732 2,166 18,898 4,860 (A) 39,276 39,276
9,580 (B)
7,500 (D)
(1,446) (G)
(116) (E)
------------- ----------- ----------- ----------- -------------- ---------------
Total assets...................... $ 284,931 $ 243,461 $ 528,392 $ 170,423 $ 698,815 $ 698,054
------------- ----------- ----------- ----------- -------------- ---------------
------------- ----------- ----------- ----------- -------------- ---------------
LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT)
CURRENT LIABILITIES:
Delchamps notes payable......... $ -- $ 4,600 $ 4,600 $ (4,600) (F) $ -- $ --
Current portion of long-term
debt.......................... 4,923 3,697 8,620 (3,697) (F) 4,923 4,923
Current portion of capitalized
leases........................ 4,899 844 5,743 5,743 5,743
Current portion of restructuring
obligation.................... 2,273 2,273 15,217 (E) 17,490 17,490
Accounts payable................ 60,940 41,571 102,511 102,511 102,511
Accrued expenses................ 34,224 28,996 63,220 63,220 63,220
Income taxes.................... 855 855 855 855
------------- ----------- ----------- ----------- -------------- ---------------
Total current liabilities..... 104,986 82,836 187,822 6,920 194,742 194,742
Senior Credit Facility............ -- 72,700 (A) 72,700 72,700
Senior Notes...................... 200,000 200,000 200,000 200,000
Senior Subordinated Notes offered
hereby.......................... 200,000 (B) 200,000 200,000
Obligations under capitalized
leases.......................... 58,663 9,556 68,219 68,219 68,219
Long term debt.................... 6,876 7,142 14,018 (7,142) (F) 6,876 6,876
Restructuring obligation.......... 13,453 13,453 31,807 (E) 45,260 45,260
Deferred income taxes............. 6,328 10,211 16,539 (13,706) (E) 2,833 2,833
Other long term liabilities....... 2,244 2,244 2,244 2,244
------------- ----------- ----------- ----------- -------------- ---------------
Total liabilities............. 376,853 125,442 502,295 290,579 792,874 792,874
Redeemable preferred stock........ 59,508 59,508 59,508 59,508
Stockholders' equity (deficit):
Preferred stock................. 8,663 8,663 8,663 8,663
Common stock.................... 4 71 75 (71) (E) 4 4
Additional paid in capital...... (302,326) 19,766 (282,560) (19,766) (E) (302,326) (302,326)
Retained earnings............... 142,229 98,182 240,411 (98,182) (E) 140,092 139,331
(897) (G)
(1,240) (C)
------------- ----------- ----------- ----------- -------------- ---------------
Total stockholders' equity
(deficit)................... (151,430) 118,019 (33,411) (120,156) (153,567) (154,328)
------------- ----------- ----------- ----------- -------------- ---------------
Total liabilities and
stockholders' equity
(deficit)....................... $ 284,931 $ 243,461 $ 528,392 $ 170,423 $ 698,815 $ 698,054
------------- ----------- ----------- ----------- -------------- ---------------
------------- ----------- ----------- ----------- -------------- ---------------
</TABLE>
See accompanying notes to Pro Forma Condensed Consolidated Balance Sheet.
24
<PAGE>
NOTES TO PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
(DOLLARS IN THOUSANDS)
(A) Reflects receipt of gross proceeds of $72,700 from the initial borrowing
under the Senior Credit Facility, net of financing fees of $4,860, which
have been included in other assets, net.
(B) Reflects receipt of gross proceeds of $200,000 from the issuance of the
Existing Notes, net of $9,580 of selling commissions and other offering
expenses, which have been reflected as debt issuance costs and included in
other assets, net.
(C) Reflects the payment and write-off of $2,000 of fees related to a commitment
to provide bridge financing, which terminated upon issuance of the Existing
Notes, as well as the related tax benefit of $760 and reduction to retained
earnings of $1,240.
(D) Reflects consent and related solicitation fees totaling $7,500, which have
been included in other assets, net, relating to the Consent Solicitation.
(E) Reflects (i) the preliminary calculation of the excess of the purchase price
in the Delchamps Acquisition over the book value of the net assets acquired
and (ii) the preliminary allocation of such excess, in each case, as set
forth below. The Delchamps Acquisition will be accounted for as a purchase,
and the total purchase price will be allocated to Delchamps' tangible and
intangible assets and liabilities based on their estimated fair values at
the closing date of the acquisition, based on valuations and studies which
have not yet been performed. Accordingly, the excess of the purchase price
over the historical book value of the net assets to be acquired has not yet
been allocated to individual assets and liabilities, other than as shown
below. Any variation between such amounts and the final allocation will
change the amount of goodwill recognized in connection with the Delchamps
Acquisition and the related amortization expense. Management believes,
however, that when the final valuation of the net assets acquired is
completed, the allocation of the purchase price will not differ materially
from the amounts shown herein.
25
<PAGE>
NOTES TO PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (CONTINUED)
(UNAUDITED)
(DOLLARS IN THOUSANDS)
The purchase price and preliminary pro forma calculation of the excess of
the purchase price over the book value of net assets acquired is as follows:
<TABLE>
<S> <C> <C>
Cash purchase price............................... $ 218,200
Estimated transaction fees in addition to debt
issuance costs.................................. 3,060
Change of control payments to Delchamps
management...................................... 12,100
---------
Total cash payments in connection with the
Delchamps Acquisition....................... 233,360
Delchamps stockholders' equity:
Common stock.................................. 71
Additional paid in capital.................... 19,766
Retained earnings............................. 98,182
---------
Total......................................... 118,019
Elimination of existing deferred financing
costs of $116, net of $44 tax benefit....... (72)
---------
Book value of net assets acquired............. 117,947
---------
Excess of purchase price over net book value.... $ 115,413
---------
---------
Preliminary allocation of excess of purchase price
over net book value:
Amount assigned to inventory...................... $ 14,171
Deferred tax liability - current(1)............... (3,517)
Deferred tax asset - current(2)................... 5,665
Deferred tax asset - non-current(1)............... 13,706
Adjustments related to Delchamps facilities to be
closed in connection with the Delchamps
Acquisition(3):
Write-off of property and equipment............. (4,260)
Current portion of restructuring obligation..... (15,217)
Long-term portion of restructuring obligation... (31,807)
Amount assigned to goodwill....................... 136,672
---------
Total......................................... $ 115,413
---------
---------
</TABLE>
- ------------------------
(1) Relates to differences between the book and tax basis of assets acquired
and liabilities assumed.
(2) Relates to change of control payments to Delchamps management and
accrued severance costs.
(3) Excludes any sales of stores to address FTC concerns. See Note (H)
below.
(F) Reflects the retirement of $15,439 of Delchamps current and long-term debt
obligations.
(G) Reflects the write-off of $1,446 of deferred financing costs relating to the
March 1996 execution of the Senior Credit Facility, as well as the related
tax benefit of $549 and reduction to retained earnings of $897.
26
<PAGE>
NOTES TO PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (CONTINUED)
(UNAUDITED)
(DOLLARS IN THOUSANDS)
(H) As discussed under "The Transactions - Expected Store Closures and
Divestitures," Management expects that the Company will be required to
divest approximately ten stores under a consent decree with the FTC.
Adjustments reflected herein for such divestitures are estimated as follows:
Jitney-Jungle stores:
<TABLE>
<C> <S> <C>
Book value of property and equipment sold.................................... $ 3,201
Net proceeds from sale....................................................... (1,973)
---------
Loss on sale before tax benefit.............................................. 1,228
Tax benefit.................................................................. (467)
---------
Net loss (charged to retained earnings)...................................... $ 761
---------
---------
Delchamps stores:
Book value of property and equipment sold.................................... $ 3,451
Net proceeds from sale....................................................... (1,902)
---------
Loss on sale before tax benefit.............................................. 1,549
Tax benefit.................................................................. (589)
---------
Net loss (increase in goodwill).............................................. $ 960
---------
---------
</TABLE>
27
<PAGE>
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND OTHER DATA
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
YEAR ENDED MAY 3, 1997
----------------------------------------------------------------------------------------------
HISTORICAL COMPANY PRO
---------------------------------------- CLOSED PRO FORMA COMPANY FORMA FOR FTC
JITNEY-JUNGLE DELCHAMPS(A) COMBINED STORES(B) ADJUSTMENTS PRO FORMA DIVESTITURES(C)
------------- -------------- --------- --------- ----------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
NET SALES........................ $ 1,228,533 $1,102,947 $2,331,480 $ (80,757) $2,250,723 $ 2,159,542
COSTS AND EXPENSES:
Cost of sales.................. 925,446 805,832 1,731,278 (62,671) 1,668,607 1,596,277
Direct store expense........... 199,956 231,835 431,791 (22,899) $ (998)(D) 407,894 390,119
Warehouse, administrative and
general expenses............. 63,094 45,273 108,367 (16,335)(D) 96,899 96,931
4,556(E)
750(F)
(439)(I)
Special charges, net(G)........ 2,737 2,220 4,957 4,957 4,957
------------- -------------- --------- --------- ----------- ----------- ---------------
Operating income............... 37,300 17,787 55,087 4,813 12,466 72,366 71,258
Interest expense, net.......... 36,215 4,982 41,197 -- 31,317(H) 67,492 67,492
(5,022)(I)
------------- -------------- --------- --------- ----------- ----------- ---------------
Earnings (loss) before taxes on
income....................... 1,085 12,805 13,890 4,813 (13,829) 4,874 3,766
Income tax expense (benefit)... 339 4,851 5,190 1,798 (3,524)(J) 3,464 3,050
------------- -------------- --------- --------- ----------- ----------- ---------------
NET EARNINGS (LOSS).............. $ 746 $ 7,954 $ 8,700 $ 3,015 $ (10,305) $ 1,410 $ 716
------------- -------------- --------- --------- ----------- ----------- ---------------
------------- -------------- --------- --------- ----------- ----------- ---------------
OTHER DATA:
EBITDA(K)........................ $ 70,344 $ 44,117 $ 114,461 $ 2,513 $ 13,435 $ 130,409 $ 127,235
Depreciation and amortization.... 31,319 23,719 55,038 (2,245) 969 53,762 51,670
LIFO expense (benefit)........... (1,012) 391 (621) (55) -- (676) (650)
Capital expenditures............. 24,099 15,551 39,650 -- -- 39,650 39,650
Gross profit as a percentage of
sales............................ 24.7% 26.9% 25.7% 25.9% 26.1%
EBITDA as a percentage of
sales............................ 5.7% 4.0% 4.9% 5.8% 5.9%
Ratio of earnings to fixed
charges(L)..................... 1.0x 1.6x 1.2x 1.1x 1.0x
Ratio of EBITDA to cash interest
expense(M)..................... 1.9x 8.9x 2.8x 2.0x 2.0x
</TABLE>
See accompanying notes to Pro Forma Condensed Consolidated Statements of
Operations and Other Data.
28
<PAGE>
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND OTHER DATA
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
12 WEEKS ENDED JULY 20, 1996
-----------------------------------------------------------------------------------------------
COMPANY PRO
HISTORICAL FORMA FOR FTC
---------------------------------------- CLOSED PRO FORMA COMPANY PRO DIVESTITURES
JITNEY-JUNGLE DELCHAMPS (A) COMBINED STORES (B) ADJUSTMENTS FORMA (C)
------------- -------------- --------- ---------- ----------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
NET SALES........................ $ 282,166 $ 284,662 $ 566,828 $ (21,964) $ 544,864 $ 522,745
COSTS AND EXPENSES:
Cost of sales.................. 211,627 210,158 421,785 (17,150) 404,635 387,010
Direct store expense........... 45,447 55,813 101,260 (5,880) $ (230)(D) 95,150 90,955
Warehouse, administrative and
general expenses............. 14,241 13,148 27,389 (3,769)(D) 24,742 24,749
1,051(E)
173(F)
(102)(I)
Special charges, net(G)........ (187) (187) (187) (187)
------------- -------------- --------- ---------- ----------- ----------- ---------------
Operating income............... 10,851 5,730 16,581 1,066 2,877 20,524 20,218
Interest expense, net.......... 8,378 1,494 9,872 -- 7,271(H) 15,580 15,580
(1,563)(I)
------------- -------------- --------- ---------- ----------- ----------- ---------------
Earnings (loss) before taxes on
income....................... 2,473 4,236 6,709 1,066 (2,831) 4,944 4,638
Income tax expense (benefit)... 921 1,583 2,504 398 (676)(J) 2,226 2,112
------------- -------------- --------- ---------- ----------- ----------- ---------------
NET EARNINGS (LOSS).............. $ 1,552 $ 2,653 $ 4,205 $ 668 $ (2,155) $ 2,718 $ 2,526
------------- -------------- --------- ---------- ----------- ----------- ---------------
------------- -------------- --------- ---------- ----------- ----------- ---------------
OTHER DATA:
EBITDA(K)........................ $ 17,813 $ 11,343 $ 29,156 $ 505 $ 3,100 $ 32,761 $ 31,986
Depreciation and amortization.... 7,062 5,486 12,548 (546) 223 12,225 11,750
LIFO expense (benefit)........... (100) 314 214 (15) -- 199 205
Capital expenditures............. 6,122 7,563 13,685 -- -- 13,685 13,685
Gross profit as a percentage of
sales............................ 25.0% 26.2% 25.6% 25.7% 26.0%
EBITDA as a percentage of
sales............................ 6.3% 4.0% 5.1% 6.0% 6.1%
Ratio of earnings to fixed
charges(L)..................... 1.3x 1.8x 1.5x 1.2x 1.2x
Ratio of EBITDA to cash interest
expense(M)..................... 2.1x 7.6x 3.0x 2.2x 2.1x
</TABLE>
See accompanying notes to Pro Forma Condensed Consolidated Statements of
Operations and Other Data.
29
<PAGE>
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND OTHER DATA
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
12 WEEKS ENDED JULY 26, 1997
-----------------------------------------------------------------------------------------------
COMPANY PRO
HISTORICAL FORMA FOR FTC
---------------------------------------- CLOSED PRO FORMA COMPANY PRO DIVESTITURES
JITNEY-JUNGLE DELCHAMPS (A) COMBINED STORES (B) ADJUSTMENTS FORMA (C)
------------- -------------- --------- ---------- ----------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
NET SALES.................... $ 288,978 $ 266,893 $ 555,871 $ (18,194) $ 537,677 $ 515,582
COSTS AND EXPENSES:
Cost of sales.............. 216,464 188,261 404,725 (13,359) 391,366 374,388
Direct store expense....... 48,058 57,272 105,330 (5,563) $ (230)(D) 99,537 95,089
Warehouse, administrative
and general expenses..... 12,772 12,643 25,415 (3,769)(D) 22,768 22,775
1,051(E)
173(F)
(102)(I)
Special charges, net(G).... 5 5 5 5
------------- -------------- --------- ---------- ----------- ----------- ---------------
Operating income........... 11,684 8,712 20,396 728 2,877 24,001 23,325
Interest expense, net...... 8,241 999 9,240 -- 6,797(H) 15,530 15,530
(507)(I)
------------- -------------- --------- ---------- ----------- ----------- ---------------
Earnings (loss) before
taxes on income.......... 3,443 7,713 11,156 728 (3,413) 8,471 7,795
Income tax expense
(benefit)................ 1,284 2,859 4,143 272 (897)(J) 3,518 3,265
------------- -------------- --------- ---------- ----------- ----------- ---------------
NET EARNINGS (LOSS).......... $ 2,159 $ 4,854 $ 7,013 $ 456 $ (2,516) $ 4,953 $ 4,530
------------- -------------- --------- ---------- ----------- ----------- ---------------
------------- -------------- --------- ---------- ----------- ----------- ---------------
OTHER DATA:
EBITDA(K).................... $ 18,616 $ 14,778 $ 33,394 $ 193 $ 3,100 $ 36,687 $ 35,543
Depreciation and
amortization................. 6,982 6,120 13,102 (523) 223 12,802 12,328
LIFO expense (benefit)....... (50) (59) (109) (12) -- (121) (115)
Capital expenditures......... 4,985 4,409 9,394 -- -- 9,394 9,394
Gross profit as a percentage
of sales..................... 25.1% 29.5% 27.2% 27.2% 27.4%
EBITDA as a percentage of
sales........................ 6.4% 5.5% 6.0% 6.8% 6.9%
Ratio of earnings to fixed
charges(L)................. 1.4x 2.6x 1.8x 1.4x 1.4x
Ratio of EBITDA to cash
interest expense(M)........ 2.3x 14.8x 3.6x 2.5x 2.4x
</TABLE>
See accompanying notes to Pro Forma Condensed Consolidated Statements of
Operations and Other Data.
30
<PAGE>
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND OTHER DATA
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
LTM PERIOD
----------------------------------------------------------------------------------------------
HISTORICAL COMPANY PRO
---------------------------------------- CLOSED PRO FORMA COMPANY FORMA FOR FTC
JITNEY-JUNGLE DELCHAMPS(A) COMBINED STORES(B) ADJUSTMENTS PRO FORMA DIVESTITURES(C)
------------- -------------- --------- --------- ----------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
NET SALES........................ $ 1,235,345 1,102,947 $2,338,292 $ (80,757) $2,257,535 $ 2,166,461
COSTS AND EXPENSES:
Cost of sales.................. 930,283 805,832 1,736,115 (62,671) 1,673,444 1,601,558
Direct store expense........... 202,567 231,835 434,402 (22,899) $ (998)(D) 410,505 392,673
Warehouse, administrative and
general expenses............. 61,625 45,273 106,898 (16,335)(D) 95,430 95,462
4,556(E)
750(F)
(439)(I)
Special charges, net(G)........ 2,737 2,220 4,957 4,957 4,957
------------- -------------- --------- --------- ----------- ----------- ---------------
Operating income............... 38,133 17,787 55,920 4,813 12,466 73,199 71,811
Interest expense, net.......... 36,078 4,982 41,060 -- 30,843(H) 67,484 67,484
(4,419)(I)
------------- -------------- --------- --------- ----------- ----------- ---------------
Earnings (loss) before taxes on
income....................... 2,055 12,805 14,860 4,813 (13,958) 5,715 4,327
Income tax expense (benefit)... 702 4,851 5,553 1,798 (3,573)(J) 3,778 3,260
------------- -------------- --------- --------- ----------- ----------- ---------------
NET EARNINGS (LOSS).............. $ 1,353 $ 7,954 $ 9,307 $ 3,015 $ (10,385) $ 1,937 $ 1,067
------------- -------------- --------- --------- ----------- ----------- ---------------
------------- -------------- --------- --------- ----------- ----------- ---------------
OTHER DATA:
EBITDA(K)........................ 71,147 $ 44,117 115,264 $ 2,513 $ 13,435 $ 131,212 $ 127,800
Depreciation and amortization.... 31,239 23,719 54,958 (2,245) 969 53,682 51,632
LIFO expense (benefit)........... (962) 391 (571) (55) -- (626) (600)
Capital expenditures............. 22,962 15,551 38,513 -- -- 38,513 38,513
Gross profit as a percentage of
sales.......................... 24.7% 26.9% 25.8% 25.9% 26.1%
EBITDA as a percentage of
sales............................ 5.8% 4.0% 4.9% 5.8% 5.9%
Ratio of earnings to fixed
charges(L)..................... 1.1x 1.6x 1.2x 1.1x 1.1x
Ratio of EBITDA to cash interest
expense(M)..................... 2.0x 8.9x 2.8x 2.0x 2.0x
</TABLE>
See accompanying notes to Pro Forma Condensed Consolidated Statements of
Operations and Other Data.
31
<PAGE>
NOTES TO PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS AND OTHER DATA
(UNAUDITED)
(DOLLARS IN THOUSANDS)
(A) Delchamps historically has accounted for warehouse costs as part of cost of
goods sold, while Jitney-Jungle has accounted for such costs as part of
warehouse, administrative and general expenses. The historical data for
Delchamps reflects a reclassification of gross profit and selling, general
and administrative expenses as though such warehouse costs had been
accounted for in accordance with the historical financial statements of
Jitney-Jungle.
(B) In connection with the Delchamps Acquisition, Management has identified 13
Delchamps stores which it intends to close due to unprofitability. Pro
forma adjustments have been made to eliminate the historical operating
results of these stores.
(C) As discussed under "The Transactions--Expected Store Closures and
Divestitures," Management expects that the Company will be required to
divest approximately ten stores under a consent decree with the FTC. Pro
forma adjustments have been made to eliminate the historical operating
results of these stores. In addition, the difference between the historical
carrying amount of the net assets of such stores and the estimated net
proceeds to be realized on their disposal (i) in the case of Jitney-Jungle
stores, will be recorded as a non-recurring charge or credit to income and
(ii) in the case of Delchamps stores, has been reflected herein as an
increase in the amount of goodwill recorded in connection with the
acquisition and the related goodwill amortization. Because the price at
which such stores will ultimately be divested is not yet certain, any
variation between the actual price and the price estimated herein (see Note
H to the Pro Forma Condensed Consolidated Balance Sheet) will change (i)
the non-recurring charge or credit to income in the case of Jitney-Jungle
stores and (ii) goodwill and related amortization expense in the case of
Delchamps stores.
(D) In connection with the Delchamps Acquisition, Management has performed a
review of operating activities of Jitney-Jungle and Delchamps and identified
duplicative costs of $17,333 (which includes $14,185 of cash costs and
$3,148 of depreciation and amortization) that it believes can be eliminated
in connection with the Delchamps Acquisition, as follows.
(i) Management has decided to consolidate the Mobile, Alabama headquarters
of Delchamps with Jitney-Jungle's existing Jackson, Mississippi
headquarters. Although a divisional office will be opened in Mobile, the
Delchamps headquarters will be closed. Cost savings associated with such
closing include savings resulting from headcount reductions at both
facilities of $5,951 for the year ended May 3, 1997 and the LTM Period
and $1,373 for the 12 weeks ended July 20, 1996 and the 12 weeks ended
July 26, 1997. Cost savings resulting from the elimination of other
operating costs are estimated at $4,281 (including $975 of reduced
depreciation and amortization) for the year ended May 3, 1997 and the
LTM Period and $988 (including $225 of reduced depreciation and
amortization) for the 12 weeks ended July 20, 1996 and the 12 weeks
ended July 26, 1997.
(ii) Management has decided to close Delchamps' Hammond, Louisiana warehouse
facility and consolidate such operations at the Company's existing
warehouse facilities. Total cost savings resulting from this facility
consolidation are estimated at $6,103 (including $2,173 of reduced
depreciation and amortization) for the year ended May 3, 1997 and the
LTM Period and $1,408 (including $501 of reduced depreciation and
amortization) for the 12 weeks ended July 20, 1996 and the 12 weeks
ended July 26, 1997.
(iii) It has been Delchamps' practice to outsource all of its advertising
printing to third parties, whereas Jitney-Jungle has utilized an
in-house advertising printing facility. Because of excess capacity at
Jitney-Jungle's facility, all Delchamps' advertising circulars will be
printed at Jitney-Jungle's facility. Annualized cost savings resulting
therefrom are estimated at $998 for the year ended May 3, 1997 and the
LTM Period and $230 for the 12 weeks ended July 20, 1996 and the 12
weeks ended July 26, 1997.
32
<PAGE>
NOTES TO PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS AND OTHER DATA (CONTINUED)
(UNAUDITED)
(DOLLARS IN THOUSANDS)
In addition to the cost savings identified above, Management has identified
certain other cost savings opportunities. As a result of the increase in
purchasing volume requirements resulting from the Delchamps Acquisition,
Management believes that the Company should be able to negotiate more
favorable terms from vendors. Management believes that this increased
purchasing leverage should result in approximately $3,352 in annualized cost
savings, which the Company should begin realizing within six to nine months
following the Delchamps Acquisition. Management also believes the increase
in purchasing volume will enable the Company to increase its backhaul income
by approximately $1,841 on an annualized basis. In addition, Management
plans to take certain steps to improve warehouse and distribution
efficiencies, including negotiation of a long-term agreement to supply slow
turning items to the Company's supermarkets and thereby reduce inventory
levels.
(E) Reflects amortization of goodwill using an estimated useful life of 30
years.
(F) Reflects a $750 increase in the annual BRS management fee pursuant to the
amendment of the BRS Management Agreement in connection with the Delchamps
Acquisition. See "Certain Relationships and Related Transactions--BRS
Management Agreement."
(G) Includes for the year ended May 3, 1997 and the LTM Period (i) a $1,779
non-cash charge accrued in fiscal 1997 relating to future payments that will
be made under an employment agreement with Jitney-Jungle's former Chief
Executive Officer; (ii) a $958 charge relating to termination benefits
payable to employees of Jitney-Jungle whose positions were eliminated in May
1997; (iii) a $4,300 charge relating to cash payments made by Delchamps in
connection the settlement of a lawsuit in March 1997; and (iv) a $2,080 gain
on the sale of certain assets of Delchamps in fiscal 1997. Includes a $187
gain and a $5 loss on the sale of certain assets of Delchamps for the 12
weeks ended July 20, 1996 and the 12 weeks ended July 26, 1997,
respectively.
(H) Reflects interest expense related to borrowings outstanding under (i) the
Senior Credit Facility upon consummation of the Delchamps Acquisition
(giving effect to the change in interest rate which occurred in connection
with the restatement thereof) and (ii) the Notes:
<TABLE>
<CAPTION>
12 WEEKS ENDED
YEAR ENDED ----------------------------
MAY 3, 1997 JULY 20, 1996 JULY 26, 1997 LTM PERIOD
----------- ------------- ------------- -----------
<S> <C> <C> <C> <C>
Senior Credit Facility (at a weighted average
interest rate of 7.65%):
Existing borrowings........................... $ 1,985 $ 507 $ -- $ 1,478
Borrowings in connection with the Delchamps
Acquisition................................. 5,562 1,283 1,283 5,562
Amortization of financing fees - Senior Credit
Facility(1)................................. 972 224 224 972
Commitment fee under Senior Credit Facility... 257 56 89 290
Notes (10.375%):
Cash interest expense......................... 20,750 4,788 4,788 20,750
Amortization of debt issuance costs(1)........ 958 221 221 958
Amortization of consent and related solicitation
fees pertaining to the Consent
Solicitation(1)............................... 833 192 192 833
----------- ------ ------ -----------
$ 31,317 $ 7,271 $ 6,797 $ 30,843
----------- ------ ------ -----------
----------- ------ ------ -----------
</TABLE>
- ------------------------
(1) Debt issuance costs associated with the Notes are amortized over ten
years on a straight-line basis. Deferred financing fees associated with
the Senior Credit Facility are amortized over five years on a
straight-line basis. The consent and related solicitation fees
pertaining to the Consent Solicitation are amortized over the remaining
life of the Senior Notes on a straight-line basis.
33
<PAGE>
NOTES TO PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS AND OTHER DATA (CONTINUED)
(UNAUDITED)
(DOLLARS IN THOUSANDS)
(I) Reflects elimination of interest expense, including amortization of debt
issuance costs, in connection with (i) the repayment of Delchamps debt and
(ii) existing borrowings under the Senior Credit Facility:
<TABLE>
<CAPTION>
12 WEEKS ENDED
YEAR ENDED ----------------------------
MAY 3, 1997 JULY 20, 1996 JULY 26, 1997 LTM PERIOD
----------- ------------- ------------- -----------
<S> <C> <C> <C> <C>
Delchamps debt:
Notes payable....................... $ 1,748 $ 691 $ 276 $ 1,748
Delchamps long-term debt............ 750 213 175 750
Senior Credit Facility:
Cash interest expense related to
existing borrowings............... 2,144 584 -- 1,560
Commitment fee under Senior Credit
Facility.......................... 380 75 56 361
----------- ------ ------ -----------
5,022 1,563 507 4,419
----------- ------ ------ -----------
Amortization of Delchamps debt
issuance costs...................... 39 10 10 39
Amortization of financing fees--
Senior Credit Facility.............. 400 92 92 400
----------- ------ ------ -----------
439 102 102 439
----------- ------ ------ -----------
$ 5,461 $ 1,665 $ 609 $ 4,858
----------- ------ ------ -----------
----------- ------ ------ -----------
</TABLE>
(J) Reflects the effect on income tax expense of pro forma adjustments
described in these footnotes, other than non-deductible goodwill
amortization, at an effective statutory tax rate of 38%.
(K) EBITDA is defined as income from continuing operations before interest,
taxes, depreciation, amortization, LIFO expense (benefit) and special items,
net. EBITDA is presented because it is a widely accepted financial indicator
of a company's ability to service indebtedness. However, EBITDA should not
be considered as an alternative to income from operations or to cash flows
from operating activities (as determined in accordance with generally
accepted accounting principles) and should not be construed as an indication
of a company's operating performance or as a measure of liquidity.
(L) The ratio of earnings to fixed charges is computed by adding fixed charges
to earnings (loss) before taxes on income and dividing that amount by fixed
charges. Fixed charges consist of interest (including amortization of debt
issuance costs) and a portion of rent expense that management considers to
be interest.
(M) Pro forma cash interest expense excludes amortization of deferred financing
fees of $2,763 for the year ended May 3, 1997 and the LTM Period and $637
for the 12 weeks ended July 20, 1996 and the 12 weeks ended July 26, 1997.
34
<PAGE>
PRO FORMA LIQUIDITY
It is anticipated that the Company's principal sources of liquidity will be
cash flow from operations and borrowings under the Senior Credit Facility and
its principal uses of cash will be to fund working capital and acquisitions and
to meet debt service requirements. The Company incurred significant indebtedness
in connection with the Transactions. At July 26, 1997, on a Pro Forma Basis, the
Company would have had approximately $558.5 million of total debt (including
capitalized leases and current installments) as compared to $275.4 million of
actual long-term indebtedness at July 26, 1997. In addition, on a Pro Forma
Basis, the Company would have had a shareholders' deficit of approximately
$154.3 million at July 26, 1997, as compared to an actual shareholders' deficit
of $151.4 million as of July 26, 1997. The Company's significant debt service
obligations following the Delchamps Acquisition could, under certain
circumstances, have material consequences to security holders of the Company.
See "Risk Factors."
In connection with the Transactions, the Company borrowed approximately
$72.7 million under the Senior Credit Facility. Following the consummation of
the Delchamps Merger, the Company will have approximately $11.2 million of
outstanding letters of credit under the Senior Credit Facility. Giving effect to
such letters of credit, Management expects that approximately $66.1 million of
additional borrowings will be available under the Senior Credit Facility
immediately following the Delchamps Acquisition to fund ongoing capital
requirements. See "Description of Certain Indebtedness--Senior Credit Facility."
As of July 26, 1997, the Company had no commitments for capital
expenditures. For fiscal 1998 and fiscal 1999, the Company has budgeted
approximately $50.0 million and $64.0 million, respectively, of capital
expenditures. Such planned capital expenditures primarily relate to new
supermarket openings and remodelings and expansions of existing supermarkets.
Capital expenditure plans of the Company are frequently reviewed and are
modified from time to time depending on cash availability and other economic
factors.
The Company's expenditures to comply with environmental laws and regulations
at its supermarkets primarily consist of those related to remediation of
underground storage tank leaks and spills and retrofitting chlorofluorocarbon
("CFC") chiller units. The Company's unreimbursed cost for remediation at the 16
facilities which have had leaks or spills from underground storage tanks has not
been material. All significant required expenditures in connection with the
clean up of such leaks and spills have been made at these 16 locations, except
at three newly discovered locations which are still undergoing investigation and
one location awaiting state approval of its remediation plan. Based on past
experience, the Company does not anticipate material expenditures at these
locations. In addition, the Company has obtained insurance coverage for bodily
injury, property damage and corrective action expenses resulting from releases
of petroleum products from underground storage tanks during the covered period
at 53 of its 57 underground storage tank locations, and an application for such
coverage is pending at one of the four remaining locations. The Company spent
$515,000, $468,000 and $914,000 retrofitting CFC containing chiller units and
upgrading tanks during fiscal 1995, fiscal 1996 and the LTM Period,
respectively. Between approximately $472,000 and $1,055,000 in expenditures are
contemplated for retrofitting the CFC units and between approximately $455,000
and $755,000 in expenditures are contemplated for tank upgrading to comply with
the 1998 tank standards or closure in fiscal 1998 and fiscal 1999. These
regulatory compliance costs are not covered by insurance.
The Company's ability to fund working capital and acquisitions, and to meet
its debt service requirements, will be dependent on its future performance
which, in turn, will be subject to management, financial, competitive and other
factors affecting the business and operations of the Company, some of which are
beyond the control of the Company. Specifically, the Company's future
performance will be dependent upon its ability to successfully integrate the
Delchamps business and to achieve estimated cost savings both in connection with
the Delchamps Acquisition and on an ongoing basis. If the Company is unable to
generate sufficient cash flow to meet its debt service obligations, the Company
may be required
35
<PAGE>
to renegotiate the payment terms or to refinance all or a portion of the Senior
Credit Facility, the Senior Notes or the Notes, to sell assets or to obtain
additional financing. If the Company could not successfully refinance its
indebtedness, substantially all of the Company's long-term debt would be in
default and could be declared immediately due and payable. See "Risk
Factors--Substantial Leverage."
During the fiscal year ended June 28, 1997, Delchamps generated
approximately $1.1 billion and $44.1 million, respectively, of net sales and
EBITDA. In addition to the incremental net sales, EBITDA and market share
expected to result from the Delchamps Acquisition, Management believes that it
should be able to achieve significant cash cost savings in connection with the
combined operation of the Jitney-Jungle and Delchamps businesses following the
Delchamps Acquisition. While the exact timing and amount of such cash cost
savings is inherently uncertain, Management currently expects that the Company
should begin to realize such cash cost savings within three to nine months after
the Delchamps Acquisition. Generally, such cash cost savings are expected to
result from (i) reduced general and administrative expenses arising from the
closure of the corporate headquarters of Delchamps and associated headcount
reductions, (ii) improved warehouse and distribution efficiencies, (iii) reduced
advertising and printing expenses resulting from moving a portion of Delchamps'
print advertising needs to Jitney-Jungle's in-house printing facilities, (iv)
increased purchasing leverage that may enable the Company to negotiate more
favorable terms from its vendors, and (v) increased backhaul income.
Of the aggregate potential $19.4 million in annualized cash cost savings
discussed above, approximately $14.2 million are reflected in the Pro Forma
Condensed Consolidated Financial Statements included elsewhere herein because
Management believes they are factually supportable and directly related to the
Transactions and the Delchamps Merger. The potential cash cost savings discussed
above are based on estimates prepared solely by members of Management based on
information available to them and have not been independently reviewed. The
estimates necessarily make assumptions as to future events, including general
industry, competitive and business conditions, many of which are beyond the
control of the Company. Actual cash cost savings achieved by the Company may
vary considerably from the estimates discussed above. See "Risk
Factors--Integration of Delchamps."
Jitney-Jungle and Delchamps have improved their EBITDA margins from 5.5% and
2.9%, respectively, in fiscal 1992 to 5.7% and 4.0%, respectively, in fiscal
1997. The Company continuously reviews its operations to identify initiatives
designed to reduce operating costs and increase EBITDA margins. As a result of
the following initiatives, Management believes that the Company can further
improve its EBITDA margins during fiscal 1998: (i) headcount reductions
implemented by Jitney-Jungle in May 1997 which are expected to result in
annualized cost savings of approximately $0.9 million in fiscal 1998; and (ii)
improved labor scheduling currently being implemented at Jitney-Jungle
supermarkets, which is expected to result in annualized cost savings of
approximately $3.5 million in fiscal 1998 and which may also result in
additional cost savings when implemented during the next 12 to 18 months at the
Delchamps supermarkets. In addition, Management expects to implement programs at
Delchamps to reduce inventory shrink to levels comparable to those achieved at
Jitney-Jungle. There can be no assurance, however, that the Company will be able
to implement such programs and other changes within the expected time periods,
or that such programs and changes, if implemented, will produce the expected
cost savings described above.
During fiscal 1997, Jitney-Jungle successfully implemented programs to
reduce inventories by eliminating slow moving items, as well as renegotiating
more favorable payment terms with certain of its vendors. Management believes
that these measures enabled Jitney-Jungle to decrease its working capital needs
by approximately $20.0 million. Management intends to implement similar programs
at Delchamps.
36
<PAGE>
SELECTED HISTORICAL FINANCIAL INFORMATION OF JITNEY-JUNGLE
The following table sets forth selected historical financial information of
Jitney-Jungle for the five years ended May 3, 1997 and for the 12 weeks ended
July 20, 1996 and July 26, 1997. The selected financial information for the
three years ended May 3, 1997 was derived from the audited consolidated
financial statements of Jitney-Jungle included elsewhere in this Prospectus. The
selected financial information for the two years ended April 30, 1994 was
derived from audited consolidated financial statements of Jitney-Jungle. The
selected financial information as of July 20, 1996 and July 26, 1997 and for the
12 weeks ended July 20, 1996 and July 26, 1997 was derived from unaudited
consolidated financial statements of Jitney-Jungle included elsewhere in this
Prospectus which, in the opinion of Management, include all adjustments
necessary for a fair presentation of the financial condition and results of
operations of Jitney-Jungle for such periods. The results of operations for
interim periods are not necessarily indicative of a full year's operations. The
following table should be read in conjunction with "Management's Discussion and
Analysis of Financial Condition and Results of Operations of Jitney-Jungle" and
the historical consolidated financial statements of Jitney-Jungle included
elsewhere in this Prospectus.
<TABLE>
<CAPTION>
12 WEEKS
FISCAL YEAR ENDED ENDED
--------------------------------------------------------------- -----------
<S> <C> <C> <C> <C> <C> <C>
MAY 1, APRIL 30, APRIL 29, APRIL 27, MAY 3,
1993 1994 1995 1996 1997
(52 WEEKS) (52 WEEKS) (52 WEEKS) (52 WEEKS) (53 WEEKS)
JULY 20,
1996
<CAPTION>
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
OPERATING DATA:
Net sales......................................... $ 1,070,693 $ 1,152,333 $ 1,173,927 $ 1,179,318 $ 1,228,533 $ 282,166
Gross profit...................................... 250,999 276,546 288,188 292,063 303,087 70,539
Direct store expense.............................. 167,162 184,121 189,422 193,483 199,956 45,447
Warehouse, administrative and general expenses.... 47,446 53,664 57,723 60,603 63,094 14,241
Special charges, net(1)........................... -- -- -- -- 2,737 --
----------- ----------- ----------- ----------- ----------- -----------
Operating income.................................. 36,391 38,761 41,043 37,977 37,300 10,851
Interest expense, net............................. 9,920 11,626 10,823 13,000 36,215 8,378
----------- ----------- ----------- ----------- ----------- -----------
Income from continuing operations before provision
for income taxes................................ 26,471 27,135 30,220 24,977 1,085 2,473
Provision for income taxes........................ 9,354 9,956 11,417 9,062 339 921
Extraordinary item(2)............................. -- -- -- (1,456) -- --
----------- ----------- ----------- ----------- ----------- -----------
Net income........................................ $ 17,117 $ 17,179 $ 18,803 $ 14,459 $ 746 $ 1,552
----------- ----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- ----------- -----------
OTHER DATA:
EBITDA(3)......................................... $ 57,232 $ 63,457 $ 65,207 $ 64,863 $ 70,344 $ 17,813
Depreciation and amortization..................... 20,119 23,428 25,444 27,323 31,319 7,062
LIFO expense (benefit)............................ 722 1,268 (1,280) (437) (1,012) (100)
Capital expenditures.............................. 38,686 30,225 23,921 30,111 24,099 6,122
Supermarkets open at end of period................ 100 106 106 103 105 104
Remodels during period............................ 12 22 40 33 19 7
Gross profit as a percentage of sales............. 23.4% 24.0% 24.5% 24.8% 24.7% 25.0%
EBITDA as a percentage of sales................... 5.3% 5.5% 5.6% 5.5% 5.7% 6.3%
Ratio of earnings to fixed charges(4)............. 3.1x 2.8x 3.1x 2.4x 1.0x 1.3x
BALANCE SHEET DATA (AT PERIOD END):
Cash and cash equivalents......................... $ 13,031 $ 30,737 $ 20,159 $ 5,676 $ 14,426 $ 3,033
Working capital................................... 60,108 60,385 71,929 26,449 (92) 15,561
Total assets...................................... 269,798 296,803 312,415 279,003 267,845 274,011
Total debt........................................ 98,665 102,814 99,198 302,461 272,462 286,372
Redeemable preferred stock........................ -- -- -- 49,988 57,921 50,035
Stockholders' equity (deficit).................... 111,099 124,857 140,216 (144,815) (152,002) (143,280)
<CAPTION>
<S> <C>
JULY 26,
1997
<S> <C>
OPERATING DATA:
Net sales......................................... $ 288,978
Gross profit...................................... 72,514
Direct store expense.............................. 48,058
Warehouse, administrative and general expenses.... 12,772
Special charges, net(1)........................... --
-----------
Operating income.................................. 11,684
Interest expense, net............................. 8,241
-----------
Income from continuing operations before provision
for income taxes................................ 3,443
Provision for income taxes........................ 1,284
Extraordinary item(2)............................. --
-----------
Net income........................................ $ 2,159
-----------
-----------
OTHER DATA:
EBITDA(3)......................................... $ 18,616
Depreciation and amortization..................... 6,982
LIFO expense (benefit)............................ (50)
Capital expenditures.............................. 4,985
Supermarkets open at end of period................ 104
Remodels during period............................ 4
Gross profit as a percentage of sales............. 25.1%
EBITDA as a percentage of sales................... 6.4%
Ratio of earnings to fixed charges(4)............. 1.4x
BALANCE SHEET DATA (AT PERIOD END):
Cash and cash equivalents......................... $ 5,255
Working capital................................... (5,955)
Total assets...................................... 284,931
Total debt........................................ 275,361
Redeemable preferred stock........................ 59,508
Stockholders' equity (deficit).................... (151,430)
</TABLE>
- ------------------------------
(1) Includes (i) a $1.8 million non-cash charge accrued in fiscal 1997 relating
to future payments that will be made under an employment agreement with
Jitney-Jungle's former Chief Executive Officer and (ii) a $1.0 million
charge relating to termination benefits payable to employees of
Jitney-Jungle whose positions were eliminated in May 1997.
(2) Reflects a loss on early retirement of debt, net of an income tax benefit of
$0.9 million.
(3) EBITDA is defined as income from continuing operations before interest,
taxes, depreciation, amortization, LIFO expense (benefit) and special items,
net. EBITDA is presented because it is a widely accepted financial indicator
of a company's ability to service indebtedness. However, EBITDA should not
be considered as an alternative to income from operations or to cash flows
from operating activities (as determined in accordance with generally
accepted accounting principles) and should not be construed as an indication
of a company's operating performance or as a measure of liquidity.
(4) The ratio of earnings to fixed charges is computed by adding fixed charges
to earnings (loss) before taxes on income and dividing that sum by the fixed
charges. Fixed charges consist of interest (including amortization costs)
and a portion of rent expense that management considers to be interest.
37
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF JITNEY-JUNGLE
The following discussion should be read in conjunction with the financial
statements and related notes, and the other financial information, included
elsewhere in this Prospectus. References in this discussion to fiscal years are
to Jitney-Jungle's fiscal years, which end on the Saturday nearest to April 30
in the calendar year. The consolidated statements of earnings for fiscal 1995
and 1996 include 52 weeks of operations and the consolidated statements of
earnings for fiscal 1997 include 53 weeks of operations. References to Interim
1997 are to the 12 weeks ended July 20, 1996 and references to Interim 1998 are
to the 12 weeks ended July 26, 1997.
GENERAL
Jitney-Jungle operates a chain of 104 supermarkets and 53 gasoline stations.
Net sales from gasoline stations during fiscal 1995, 1996 and 1997 were 4.0%,
5.2% and 6.9%, respectively, of Jitney-Jungle's net sales for such fiscal years.
Approximately 21.0% of Jitney-Jungle's net non-perishable sales result from its
private label program. Private label products generally have a lower unit sales
price than national brands, but provide a higher gross margin to Jitney-Jungle
due to lower unit costs.
Prior to fiscal 1995, Jitney-Jungle used a LIFO valuation method derived
from the Consumer Price Index (CPI). The CPI, a Federal government index that
measures changes in retail prices, is published by the Bureau of Labor
Statistics on a monthly basis. Due to a general absence of inflation in food
prices, Jitney-Jungle changed to an internally developed price index at the
beginning of fiscal 1995 to more accurately reflect price level changes that
were specific to Jitney-Jungle's actual experience. Jitney-Jungle does not
believe that the CPI index provides a satisfactory measure of its inventory.
After switching to its own internally generated price index, which measures over
20,000 different SKUs, Jitney-Jungle experienced a LIFO credit in fiscal 1995,
1996 and 1997.
During the past three years, an overall lack of inflation in food prices and
increasingly competitive markets have made it difficult for Jitney-Jungle and
other supermarket operators to achieve comparable store sales gains. Because
sales growth has been difficult to attain, many operators, including
Jitney-Jungle, have attempted to maintain market share through increased levels
of promotional activities and discount pricing, creating a more difficult
environment in which to increase year-over-year sales gains consistently. In
addition, because of the growth in the Southeast market, many existing
operators, including Jitney-Jungle, have opened new supermarkets in existing
markets which has resulted in declines in same store sales for the existing
(comparable) store base of these same grocery chains. In an effort to offset
this trend, Jitney-Jungle intends to focus future new supermarket openings on
its combination and conventional supermarket formats which, historically, have
achieved higher operating profit margins than its discount supermarkets.
THE RECAPITALIZATION
On March 5, 1996, Jitney-Jungle effected a recapitalization (the
"Recapitalization") pursuant to an Agreement and Plan of Exchange and of Merger
dated as of November 16, 1995 by and among Jitney-Jungle, certain of its
affiliates and JJ Acquisitions Corp., a Delaware corporation formed by BRS
("JJAC"). Prior to the Recapitalization, Jitney-Jungle had five affiliates
(Southern Jitney Jungle Company, McLemore's Wholesale & Retail Stores, Inc.,
McCarty-Holman Co., Inc., Pump And Save, Inc. and Jitney-Jungle Bakery, Inc.,
each of which was under common ownership and management with Jitney-Jungle) and
five subsidiaries (Florida Jitney-Jungle Stores, Inc., Jitney-Jungle Wholesale
Co., Inc., Jackson Jet Corporation, Interstate Jitney Jungle Stores, Inc. and
Foodway, Inc., each of which was wholly-owned by Jitney-Jungle). In connection
with the Recapitalization, the common stock of each of Southern Jitney Jungle
Company, McCarty-Holman Co., Inc. and Jitney-Jungle Bakery, Inc. was exchanged
for newly-issued shares of common stock of Jitney-Jungle and certain existing
subsidiaries of Jitney-Jungle were merged with and into Jitney-Jungle or another
subsidiary of Jitney-Jungle; as a result, Jitney-Jungle had four direct,
38
<PAGE>
wholly-owned subsidiaries (Interstate Jitney-Jungle Stores, Inc., Southern
Jitney Jungle Company, McCarty-Holman Co., Inc. and Jitney-Jungle Bakery, Inc.)
and one indirect wholly-owned subsidiary, Pump And Save, Inc. Immediately
thereafter, JJAC was merged with and into Jitney-Jungle and the separate
existence of JJAC ceased. The shareholders of Jitney-Jungle received
consideration of $272.5 million in cash and $27.5 million aggregate liquidation
preference of Class B Preferred Stock. Upon completion of the Recapitalization,
71.25%, on a fully diluted basis, of the outstanding shares of Jitney-Jungle's
Common Stock was held by the Fund Entities and 10.0%, on a fully diluted basis,
continued to be held by certain shareholders of Jitney-Jungle.
THE DELCHAMPS ACQUISITION
On July 8, 1997, Jitney-Jungle entered into the Delchamps Merger Agreement
pursuant to which the Delchamps Acquisition was effected. In connection with the
Delchamps Acquisition, the Company issued and sold $200.0 million principal
amount of the Existing Notes and the Company amended and restated the Senior
Credit Facility to increase the commitments thereunder from $100.0 million to
$150.0 million. The Company used and will use the $200.0 million of gross
proceeds from the sale of the Existing Notes, together with approximately $72.7
million of borrowings under the Senior Credit Facility, to pay the $218.2
million Delchamps Purchase Price, to repay approximately $15.4 million of
Delchamps' outstanding indebtedness, to make approximately $12.1 million of
change of control payments to certain Delchamps executives and to pay
approximately $27.0 million of transaction fees and expenses. As a result of the
Transactions, Management anticipates that a one-time pre-tax charge of $4.7
million ($2.9 million after tax) will be recorded in the quarter in which the
Transactions are consummated.
RESULTS OF OPERATIONS
The following table sets forth, for the periods indicated, selected
financial information expressed as a percentage of net sales:
<TABLE>
<CAPTION>
FISCAL YEAR ENDED 12 WEEKS ENDED
------------------------------------------- ------------------------
<S> <C> <C> <C> <C> <C>
APRIL 29, APRIL 27, MAY 3,
1995 1996 1997
(52 WEEKS) (52 WEEKS) (53 WEEKS)
JULY 20, JULY 26,
1996 1997
Net sales................................................ 100.0% 100.0% 100.0% 100.0% 100.0%
Gross profit............................................. 24.5 24.8 24.7 25.0 25.1
Direct store expense..................................... 16.1 16.4 16.3 16.1 16.6
Warehouse, administrative and general expenses........... 4.9 5.1 5.1 5.0 4.4
Special charges.......................................... -- -- 0.2 -- --
Operating income......................................... 3.5 3.2 3.0 3.9 4.1
Interest expense, net.................................... 0.9 1.1 2.9 3.0 2.9
Provision for income taxes............................... 1.0 0.8 -- 0.3 0.4
Net income before extraordinary item..................... 1.6 1.3 0.1 0.6 0.8
OTHER DATA:
EBITDA................................................... 5.6% 5.5% 5.7% 6.3% 6.4%
</TABLE>
INTERIM 1998 VS. INTERIM 1997
NET SALES. Net sales increased $6.8 million or 2.4% in Interim 1998 as
compared to Interim 1997. The net sales increase was primarily attributable to
the continued favorable results of the Jitney-Jungle Gold Card (a frequent
shopper program which was launched by Jitney-Jungle in January, 1997) and sales
improvements at five discount supermarkets that were converted during that
period (two to the conventional store format and three to the combination store
format). Same store sales increased approximately 2.3% in Interim 1998.
Jitney-Jungle's store count at the end of Interim 1998 was 104 supermarkets (22
discount stores, 77 conventional stores and five combination stores) and 53
gasoline stations as compared
39
<PAGE>
to 104 supermarkets (30 discount stores, 72 conventional stores and two
combination stores) and 49 gasoline stations at the end of Interim 1997.
GROSS PROFIT. Gross profit in Interim 1998 increased $2.0 million to $72.5
million, or 25.1% of net sales, compared to $70.5 million, or 25.0% of net
sales, during Interim 1997. Gross profit increased primarily due to an increase
in sales in Interim 1998.
DIRECT STORE EXPENSE. Direct store expense was $48.1 million, or 16.6% of
net sales, for Interim 1998 as compared to $45.4 million, or 16.1% of net sales,
for Interim 1997. Direct store expense increased primarily due to an increase in
net sales in Interim 1998. The increase in direct store expense as a percentage
of net sales in Interim 1998 was principally due to increases in labor costs and
advertising expense associated with the conversion of five discount stores
during that period.
WAREHOUSE, ADMINISTRATIVE AND GENERAL EXPENSES. Warehouse, administrative
and general expenses were $12.8 million, or 4.4% of net sales in Interim 1998
compared to $14.2 million, or 5.0% of net sales, in Interim 1997. The decrease
in warehouse, administrative and general expenses was primarily due to (i) a
decrease in administrative labor costs as a result of a headcount reduction
implemented during Interim 1998, (ii) a decrease in various expenses including
travel and supplies and (iii) an increase in backhaul income.
OPERATING INCOME. Operating income was $11.7 million, or 4.1% of net sales,
in Interim 1998 as compared to $10.9 million, or 3.9% of net sales, in Interim
1997. The increase in operating income was due to the factors discussed above.
EBITDA. EBITDA was $18.6 million, or 6.4% of net sales, in Interim 1998 as
compared to $17.8 million, or 6.3% of net sales, in Interim 1997. EBITDA
increased primarily due to an increase in sales in Interim 1998 and a reduction
in warehouse, administrative and general expenses.
INTEREST EXPENSE, NET. Interest expense, net was $8.2 million in Interim
1998 as compared to $8.4 million in Interim 1997. The decrease in interest
expense was primarily due to a reduction in indebtedness outstanding under the
existing Credit Facility.
INCOME TAXES. Income taxes were $1.3 million with an effective tax rate of
37.3% for Interim 1998 as compared to $0.9 million with an effective tax rate of
37.2% for Interim 1997. The increase in income taxes was principally due to
higher pretax earnings.
NET INCOME. Net income for Interim 1998 increased $0.6 million to $2.2
million, compared to $1.6 million in Interim 1997. The increase in net income
was due to the factors discussed above.
FISCAL 1997 VS. FISCAL 1996
NET SALES. Net sales for fiscal 1997 increased 4.2% to $1,228.5 million
compared to $1,179.3 million in fiscal 1996. The increase in net sales was
primarily due to the opening of two stores, the opening of seven new gasoline
stations and the addition of a "53rd" week in fiscal 1997. Without the
additional "53rd" week, net sales would have increased approximately 2.2%. In
addition, Jitney-Jungle launched its Gold Card, a frequent shopper card program,
in the fourth quarter of fiscal 1997 which increased customer count and, as a
result, increased net sales. Same store sales increased 0.2% in fiscal 1997 over
fiscal 1996.
GROSS PROFIT. Gross profit for fiscal 1997 increased $11.0 million to
$303.1 million, or 24.7% of net sales, compared to $292.1 million, or 24.8% of
net sales, for fiscal 1996. Gross profit increased primarily due to an increase
in net sales in fiscal 1997. The decrease in gross profit as a percentage of net
sales in fiscal 1997 was primarily due to the initial effect of the new
Jitney-Jungle Gold Card which entitles customers to discounts on certain
products.
DIRECT STORE EXPENSE. Direct store expense for fiscal 1997 increased $6.5
million to $200.0 million, or 16.3% of net sales, compared to $193.5 million, or
16.4% of net sales, for fiscal 1996. Direct store expenses
40
<PAGE>
increased primarily due to an increase in net sales in fiscal 1997. The decrease
in direct store expenses as a percentage of net sales in fiscal 1997 was
principally due to decreases in store supplies and advertising costs which were
partially offset by increases in group insurance expense due to an increase in
medical claims paid during the year by the self-insured plan and increases in
depreciation expense principally due to acquisitions of property and equipment
(including capital leases) associated with Jitney-Jungle's remodeling program
and the acquisition of new stores and gasoline stations.
WAREHOUSE, ADMINISTRATIVE AND GENERAL EXPENSES. Warehouse, administrative
and general expenses for fiscal 1997 increased $2.5 million to $63.1 million, or
5.1% of net sales, compared to $60.6 million, or 5.1% of net sales, for fiscal
1996. Warehouse, administrative and general expenses increased primarily due to
(i) an increase in net sales in fiscal 1997 and (ii) an increase in amortization
expense due to increased debt issuance costs related to the Recapitalization.
The increase in warehouse, administrative and general expenses was partially
offset by an increase in backhaul income during fiscal 1997.
SPECIAL CHARGES. Includes (i) a $1.8 million non-cash charge accrued in
fiscal 1997 relating to future payments that will be made under an employment
agreement with Jitney-Jungle's former Chief Executive Officer and (ii) a $1.0
million charge relating to termination benefits payable to employees of
Jitney-Jungle whose positions were eliminated in May 1997. There were no
comparable charges in fiscal 1996.
OPERATING INCOME. Operating income for fiscal 1997 decreased $0.7 million
to $37.3 million, or 3.0% of net sales, compared to $38.0 million, or 3.2% of
net sales for fiscal 1996. The decrease in operating income was due to the
factors discussed above.
EBITDA. EBITDA for fiscal 1997 increased $5.4 million to $70.3 million, or
5.7% of net sales, compared to $64.9 million, or 5.5% of net sales, for fiscal
1996. EBITDA increased primarily due to an increase in net sales in fiscal 1997.
The increase in EBITDA as a percentage of net sales in fiscal 1997 was primarily
due to the renegotiation of a supply agreement with a major supplier and to
decreases in direct store expense as discussed above which were offset in part
by a decrease in gross profit due primarily to the initial effect of the
introduction of the Gold Card.
INTEREST EXPENSE, NET. Interest expense, net for fiscal 1997 increased
$23.2 million to $36.2 million, compared to $13.0 million for fiscal 1996. The
increase in interest expense, net was due to interest expense on the Senior
Notes and the existing Credit Facility, which were in place all of fiscal 1997
and only for two months in fiscal 1996.
INCOME TAXES. The effective rate for income taxes for fiscal 1997 decreased
to 31.2% compared to 36.3% for fiscal 1996. The decrease in effective rate for
fiscal 1997 was primarily due to lower pretax earnings which qualified
Jitney-Jungle for a lower tax bracket.
NET INCOME. Net income for fiscal 1997 decreased $13.8 million to $0.7
million, compared to $14.5 million for fiscal 1996. The decrease in net income
was due to the factors discussed above.
FISCAL 1996 VS. FISCAL 1995
NET SALES. Net sales for fiscal 1996 increased 0.5% to $1,179.3 million
compared to $1,173.9 million in fiscal 1995. The increase in net sales was
primarily due to the opening of four supermarkets and the opening of eleven new
gasoline stations, partially offset by the effect of closing seven supermarkets
and two gasoline stations in fiscal 1996. Same store sales remained relatively
flat in fiscal 1996 as compared to fiscal 1995.
GROSS PROFIT. Gross profit for fiscal 1996 increased $3.9 million to $292.1
million, or 24.8% of net sales, compared to $288.2 million, or 24.5% of net
sales, for fiscal 1995. Gross profit increased primarily due to higher net
sales. Gross profit as a percentage of net sales increased primarily due to
improved procurement results due to (i) continued enhancements and improved
utilization of Jitney-Jungle's
41
<PAGE>
information systems, which resulted in better buying decisions at better prices
and (ii) the renegotiation of a supply contract of Fleming Companies, Inc.
DIRECT STORE EXPENSE. Direct store expense for fiscal 1996 increased $4.1
million to $193.5 million, or 16.4% of net sales, compared to $189.4 million, or
16.1% of net sales, for fiscal 1995. Direct store expense increased primarily
due to higher net sales. Direct store expense as a percentage of net sales
increased primarily due to increases in personnel costs, repairs and maintenance
and depreciation expense as a result of increased capital expenditures relating
to the remodeling of stores in fiscal 1995.
WAREHOUSE, ADMINISTRATIVE AND GENERAL EXPENSES. Warehouse, administrative
and general expenses for fiscal 1996 increased $2.9 million to $60.6 million, or
5.1% of net sales, compared to $57.7 million, or 4.9% of net sales, for fiscal
1995. Warehouse, administrative and general expenses increased primarily due to
higher net sales. Warehouse, administrative and general expenses as a percentage
of net sales increased primarily due to increases in personnel costs, insurance
expense as a result of a larger provision for workers compensation and general
liability insurance and amortization expenses as a result of increased debt
issuance costs related to the Recapitalization.
OPERATING INCOME. Operating income for fiscal 1996 decreased $3.1 million
to $38.0 million, or 3.2% of net sales, from $41.0 million, or 3.5% of net
sales, for fiscal 1995. The decrease in operating income was due to the factors
discussed above.
EBITDA. EBITDA for fiscal 1996 decreased $0.3 million to $64.9 million, or
5.5% of net sales, compared to $65.2 million, or 5.6% of net sales, for fiscal
1995. EBITDA decreased primarily due to higher direct store expenses and higher
warehouse, administrative and general expenses as discussed above.
INTEREST EXPENSE, NET. Interest expense, net for fiscal 1996 increased $2.2
million to $13.0 million, compared to $10.8 million for fiscal 1995. The
increase in interest expense, net was due to an increase in Jitney-Jungle's
outstanding indebtedness pursuant to the Senior Notes and the existing Credit
Facility as a result of the Recapitalization in February 1996, partially offset
by an increase in interest income.
INCOME TAXES. The effective rate for income taxes for fiscal 1996 decreased
to 36.3% compared to 37.8% for fiscal 1995. The decrease in effective rate for
fiscal 1996 was principally due to the elimination of inter-company profit of a
wholly owned subsidiary which previously was not included in the consolidated
tax return.
EXTRAORDINARY ITEM. In connection with the Recapitalization, Jitney-Jungle
retired $35.7 million in long-term debt prior to its scheduled maturity.
Prepayment penalties associated with early retirement of this debt resulted in
an extraordinary loss of $1.5 million, net of an income tax benefit of $0.9
million.
NET INCOME. Net income for fiscal 1996 decreased $4.3 million to $14.5
million, from $18.8 million for fiscal 1995. The decrease in net income was due
to the factors discussed above.
LIQUIDITY AND CAPITAL RESOURCES
Historically, Jitney-Jungle has funded its working capital requirements,
capital expenditures and other needs principally from operating cash flows. Due
to the Recapitalization, however, Jitney-Jungle has become highly leveraged and
its debt instruments contain restrictions on its operations. At July 26, 1997,
Jitney-Jungle had $275.4 million of total long-term debt (including capitalized
leases and current installments) and a shareholders deficit of $151.4 million.
Jitney-Jungle's principal uses of liquidity have been to fund working
capital, meet debt service requirements and finance Jitney-Jungle's strategic
plans. Jitney-Jungle's principal sources of liquidity have been cash flow from
operations and borrowings under the Senior Credit Facility. Jitney-Jungle has
outstanding letters of credit with a face amount of $10.5 million issued under
the Senior Credit Facility principally to secure obligations pursuant to a
capitalized lease and to secure obligations under an existing
42
<PAGE>
supply contract with Topco. At July 26, 1997, Jitney-Jungle had no outstanding
borrowings under the Senior Credit Facility.
The commitments under the Senior Credit Facility terminate, and all loans
outstanding thereunder are required to be repaid in full on March 5, 2001.
Borrowings under the Senior Credit Facility, including revolving loans and up to
$20.0 million in letters of credit, may not exceed the lesser of (i) the "Total
Commitment," which is currently $96.3 million, and (ii) an amount equal to the
sum of (A) up to 60% of eligible inventory (valued at the lessor of FIFO cost or
market value) of Jitney-Jungle and (B) the "Supplemental Availability", which is
currently $41.3 million. Each of the Total Commitment and the Supplemental
Availability decline by $1.25 million per quarter.
Cash provided by operating activities during fiscal 1995 was $45.7 million
compared to $55.5 million for fiscal 1996 and $66.5 million for fiscal 1997.
Cash provided by operating activities for Interim 1997 was $18.1 million
compared to $5.8 million for Interim 1998. In fiscal 1997, inventories decreased
due to an inventory reduction plan implemented by Management and accounts
payable increased due to improvement of customer terms to industry standards.
These working capital improvements were partially offset by the reduction in net
income due principally to the increase in cash interest expense during fiscal
1997 as a result of Jitney-Jungle's higher total indebtedness as discussed
above. The principal reason for the increase of cash provided by operating
activities for fiscal 1996 was a decrease in inventories due, in part, to store
closings and a decrease in receivables which reflects a reduction in the
uncollected billbacks due from vendors. In Interim 1998, accounts payable
increased due to improvement of customer terms to industry standards and
inventories increased due to (i) planned remodel sales associated with store
conversions, (ii) the improvement of service levels in Jitney-Jungle's warehouse
inventories and (iii) increased purchasing of deal merchandise at a lower cost.
Net cash used in investing activities was $46.0 million for fiscal 1995,
$12.4 million for fiscal 1996 and $22.3 million during fiscal 1997, and was $4.7
million for Interim 1997 and $4.9 million for Interim 1998. Such cash was
primarily used for capital expenditures. Capital expenditures were $23.9 million
for fiscal 1995, $30.1 million for fiscal 1996 and $24.1 million for fiscal
1997, and were $6.1 million for Interim 1997 and $5.0 million for Interim 1998.
In addition to capital expenditures related to new stores opened in fiscal 1995,
1996 and 1997, Jitney-Jungle converted two discount stores to conventional
stores, and expanded ten additional stores.
Net cash used in financing activities was $10.2 million for fiscal 1995,
$57.6 million for fiscal 1996 and $35.4 million for fiscal 1997, and was $16.1
million for Interim 1997 and $10.1 million for Interim 1998. The principal uses
of funds in financing activities for fiscal 1995 and fiscal 1997 were the
payment of long-term debt and capital lease obligations. The principal uses of
funds in financing activities in fiscal 1996 were the redemption of Common Stock
and related costs in connection with the Recapitalization, principal payments on
debt and capital lease obligations and payments of dividends to stockholders.
The principal uses of funds in financing activities for Interim 1998 were the
payment of principal on long-term debt and capital lease obligations.
Jitney-Jungle's expenditures to comply with environmental laws and
regulations at its grocery stores primarily consist of those related to
remediation of underground storage tank leaks and spills and retrofitting
chlorofluorocarbon ("CFC") chiller units and tank upgrading to meet 1998
standards. Jitney-Jungle's unreimbursed cost for remediation at the nine
Jitney-Jungle facilities which have had leaks or spills has not been material.
All significant required expenditures in connection with the cleanup of such
leaks and spills have been made at the nine locations. In addition,
Jitney-Jungle has obtained insurance coverage for bodily injury, property damage
and corrective action expenses resulting from releases of petroleum products
from underground storage tanks during the covered period at 53 of its 54
underground storage tank locations, and an application for such coverage is
pending at the remaining location. Jitney-Jungle spent $480,000, $246,000 and
$500,000 for retrofitting CFC-containing chiller units during fiscal 1995, 1996
and 1997, respectively. Jitney-Jungle spent $0, $130,000 and $220,000 for tank
upgrades during fiscal 1995, 1996 and 1997, respectively.
43
<PAGE>
SELECTED HISTORICAL FINANCIAL INFORMATION OF DELCHAMPS
The following table sets forth selected historical financial information of
Delchamps for the five years ended June 28, 1997. The operating and balance
sheet data for the three years ended June 28, 1997 were derived from the audited
consolidated financial statements of Delchamps included elsewhere in this
Prospectus. The operating and balance sheet data for the two years ended July 2,
1994 was derived from audited consolidated financial statements of Delchamps.
The following table should be read in conjunction with "Management's Discussion
and Analysis of Financial Condition and Results of Operations of Delchamps" and
the audited consolidated financial statements of Delchamps included elsewhere in
this Prospectus.
Delchamps historically has accounted for warehouse costs as part of cost of
goods sold, while Jitney-Jungle has accounted for such costs as part of
warehouse, administrative and general expenses. Following the Delchamps
Acquisition, the Company will include such costs in warehouse, administrative
and general expenses. The data set forth below under the heading "Reclassified
Data" reflect the reclassification of Delchamps' warehouse costs as though such
warehouse costs had been accounted for in accordance with the historical
financial statements of Jitney-Jungle.
<TABLE>
<CAPTION>
FISCAL YEAR ENDED
------------------------------------------------------
<S> <C> <C> <C> <C> <C>
JULY 3, JULY 2, JULY 1, JUNE 29, JUNE 28,
1993 1994 1995 1996 1997
<CAPTION>
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
OPERATING DATA:
Net sales........................................................... $1,034,531 $1,067,191 $1,054,088 $1,126,629 $1,102,947
Gross profit........................................................ 264,074 270,827 255,551 263,240 272,069
Selling, general and administrative expenses ("SG&A"):
Restructuring charge(1)........................................... -- -- 28,779 -- --
Other SG&A........................................................ 236,167 248,808 261,763 250,121 254,282
--------- --------- --------- --------- ----------
Operating income (loss)............................................. 27,907 22,019 (34,991) 13,119 17,787
Interest expense, net............................................... 5,169 4,161 5,275 6,820 4,982
--------- --------- --------- --------- ----------
Earnings (loss) before income taxes and cumulative effect of changes
in accounting principles.......................................... 22,738 17,858 (40,266) 6,299 12,805
Income tax expense.................................................. 8,365 6,207 (14,600) 2,447 4,851
--------- --------- --------- --------- ----------
Earnings (loss) before cumulative effect of change
in accounting principles.......................................... 14,373 11,651 (25,666) 3,852 7,954
Cumulative effect of change in accounting principles for:
Income taxes...................................................... -- 900 -- -- --
Post-employment benefits.......................................... -- (1,600) -- -- --
--------- --------- --------- --------- ----------
Net earnings (loss)................................................. $ 14,373 $ 10,951 $ (25,666) $ 3,852 $ 7,954
--------- --------- --------- --------- ----------
--------- --------- --------- --------- ----------
OTHER DATA:
EBITDA(2)........................................................... $ 46,228 $ 40,636 $ 19,077 $ 34,892 $ 44,117
Depreciation and amortization....................................... 18,099 18,770 19,472 21,771 23,719
LIFO expense (benefit).............................................. 210 (38) 536 422 391
Restructuring and other special charges(1).......................... 12 (115) 34,060 (420) 2,220
Capital expenditures................................................ 20,824 17,705 35,239 21,671 15,551
Supermarkets open at end of period.................................. 118 120 118 117 118
Remodels during period.............................................. 7 4 5 1 5
Gross profit as a percentage of sales 25.5% 25.4% 24.2% 23.4% 24.7%
EBITDA as a percentage of sales..................................... 4.5% 3.8% 1.8% 3.1% 4.0%
Ratio of earnings to fixed charges(3)............................... 2.4x 2.1x -- 1.3x 1.6x
BALANCE SHEET DATA (AT PERIOD END):
Cash and cash equivalents........................................... $ 12,070 $ 15,378 $ 15,906 $ 10,503 $ 5,670
Working capital..................................................... 49,511 54,926 22,920 22,067 29,140
Total assets........................................................ 252,052 263,269 269,412 255,183 243,461
Total debt.......................................................... 50,814 51,079 62,170 39,746 25,839
Long term portion of restructuring obligation(1).................... -- -- 19,219 15,668 13,453
Stockholders' equity................................................ 126,262 136,300 110,042 112,925 118,019
RECLASSIFIED DATA:
Gross profit........................................................ $ 288,761 $ 295,937 $ 279,689 $ 289,539 $ 297,115
Gross profit as a percentage of sales............................... 27.9% 27.7% 26.5% 25.7% 26.9%
Other SG&A.......................................................... $ 260,854 $ 273,918 $ 285,901 $ 276,420 $ 277,108
</TABLE>
44
<PAGE>
- ------------------------
(1) During fiscal 1995, Delchamps recorded a pretax restructuring charge of
$28,779. The charge reflected anticipated costs associated with a program to
close certain underperforming supermarkets which could not be subleased in
whole or in part and, to a lesser extent, severance costs related to the
termination of employment of former executives. In March 1997, Delchamps
incurred a charge of $4,300, resulting from the settlement of a lawsuit,
which was partially offset by a gain of $2,080 resulting from the sale of
real property in fiscal 1997.
(2) EBITDA is defined as income from continuing operations before interest,
taxes, depreciation, amortization, LIFO expense (benefit) and special items,
net. EBITDA is presented because it is a widely accepted financial indicator
of a company's ability to service indebtedness. However, EBITDA should not
be considered as an alternative to income from operations or to cash flows
from operating activities (as determined in accordance with generally
accepted accounting principles) and should not be construed as an indication
of a company's operating performance or as a measure of liquidity.
(3) The ratio of earnings to fixed charges is computed by adding fixed charges
to earnings (loss) before taxes on income and dividing that sum by the fixed
charges. Fixed charges consist of interest (including amortization costs)
and a portion of rent expense that management considers to be interest.
Earnings were insufficient to cover fixed charges in fiscal 1995 by $40,266.
45
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF DELCHAMPS
The following discussion should be read in conjunction with the audited
consolidated financial statements and related notes, and the other financial
information, included elsewhere in this Prospectus. References in this
discussion to fiscal years are to Delchamps' fiscal years, which end on the
Saturday nearest to June 30 in the calendar year.
GENERAL
Delchamps operates a chain of 118 supermarkets in the states of Alabama,
Florida, Mississippi and Louisiana, as well as ten liquor stores in the State of
Florida.
Delchamps historically has accounted for warehouse costs as part of cost of
goods sold, while Jitney-Jungle has accounted for such costs as part of
warehouse, administrative and general expenses. Following the Delchamps
Acquisition, the Company will account for such costs as part of warehouse,
administrative and general expenses. The data set forth below under the heading
"Reclassified Data" reflect the reclassification of Delchamps' warehouse costs
as though such warehouse costs had been accounted for in accordance with the
historical financial statements of Jitney-Jungle.
During the past three years, increasingly competitive markets have made it
difficult for Delchamps to achieve comparable store sales gains and improve
profitability. During Delchamps' last three fiscal years, competitors have
opened approximately 82 new supermarkets in Delchamps' operating regions,
approximately 21 of which were opened in fiscal 1997. In fiscal 1997, Delchamps
experienced a 2.1% decline in net sales and a 3.5% decline in same store sales.
Although net sales and same store sales declined, gross margin improved,
primarily as a result of selective retail price increases. Delchamps can give no
assurances that improvements in profitability can be achieved if net sales and
same store sales continue to decline as a result of competitive pressures.
On July 8, 1997, Delchamps announced that it had entered into the Delchamps
Merger Agreement pursuant to which it had agreed to be acquired by
Jitney-Jungle. The terms of the Delchamps Merger Agreement are described in
Delchamps' Schedule 14D-9, as amended, and in Jitney-Jungle's 14D-1, as amended,
both of which have been filed with the Commission. Pursuant to the Delchamps
Merger Agreement, DAC, a wholly-owned subsidiary of Jitney-Jungle, commenced the
Delchamps Tender Offer for all outstanding shares of Delchamps' common stock at
a price of $30 per share. On September 12, 1997 DAC accepted for payment
pursuant to the Delchamps Tender Offer an aggregate of 5,317,510 of such
shares.Pursuant to the Delchamps Merger Agreement, on November 4, 1997 DAC was
merged with and into Delchamps, with Delchamps continuing as the surviving
corporation.
46
<PAGE>
RESULTS OF OPERATIONS
The following table sets forth, for the periods indicated, selected
financial information expressed as a percentage of net sales:
<TABLE>
<CAPTION>
FISCAL YEAR ENDED
-------------------------------------
JULY 1, JUNE 29, JUNE 28,
1995 1996 1997
<S> <C> <C> <C>
Net sales............................................................................ 100.0% 100.0% 100.0%
Gross profit......................................................................... 24.2 23.4 24.7
SG&A:
Restructuring charge............................................................... 2.7 -- --
Other SG&A......................................................................... 24.8 22.2 23.1
Operating income..................................................................... (3.4) 1.2 1.6
Interest expense, net................................................................ 0.5 0.6 0.5
Earnings before income taxes......................................................... (3.8) 0.6 1.2
Provision for income taxes........................................................... (1.4) 0.2 0.4
Net income........................................................................... (2.4) 0.3 0.7
OTHER DATA:
EBITDA............................................................................... 1.8% 3.1% 4.0%
RECLASSIFIED DATA:
Gross profit......................................................................... 26.5% 25.7% 26.9%
Other SG&A........................................................................... 27.1 24.5 25.1
</TABLE>
FISCAL 1997 VS. FISCAL 1996
NET SALES. Net sales for fiscal 1997 decreased 2.1% to $1,103.0 million
compared to $1,127.0 million for fiscal 1996. The decrease in net sales during
fiscal 1997 occurred primarily because a significant number of new supermarkets
were opened by competitors (approximately 21 new supermarkets were opened by
competitors during fiscal 1997) and competitors increased levels of promotional
activity (which included the introduction of a frequent shopper card by a
competitor).
GROSS PROFIT. Gross profit for fiscal 1997 increased $8.8 million to $272.1
million, or 24.7% of net sales, compared to $263.2 million, or 23.4% of net
sales, for fiscal 1996. The increase in gross profit as a percentage of net
sales was primarily due to selective retail price adjustments and increased
levels of promotional and buying allowances from vendors which resulted in a
lower cost of merchandise and fewer promotional programs as compared to fiscal
1996. Assuming the reclassification of warehouse expenses from cost of sales to
SG&A, gross profit would have been $297.1 million, or 26.9% of net sales, for
fiscal 1997, compared to $289.5 million, or 25.7% of net sales, for fiscal 1996.
SG&A. SG&A expenses for fiscal 1997 increased $4.2 million to $254.3
million, or 23.1% of net sales, compared to $250.1 million, or 22.2% of net
sales, for fiscal 1996. SG&A expenses for fiscal 1997 included a $4.3 million
increase in legal expenses relating to the settlement of five related lawsuits
and a $1.7 million increase in incentive expenses which resulted from improved
pretax earnings. SG&A was favorably impacted by a $2.1 million gain on the sale
of certain real property (a former warehouse in Mobile, Alabama and land near
Birmingham, Alabama). Excluding the legal settlement and gain on sale of real
property, SG&A expenses for fiscal 1997 increased to 22.9% of net sales,
compared to 22.2% of net sales for fiscal 1996. Assuming the reclassification of
warehouse expenses from cost of sales to SG&A, SG&A would have been $277.1
million, or 25.1% of net sales, for fiscal 1997, compared to $276.4 million, or
24.5% of net sales, for fiscal 1996.
OPERATING INCOME. Operating income for fiscal 1997 increased $4.7 million
to $17.8 million, or 1.6% of net sales, compared to $13.1 million, or 1.1% of
net sales for fiscal 1996. Excluding the charge for the lawsuit settlement and
the gain from sale of certain real property, operating income for fiscal 1997
increased $6.9 million to $20.0 million, or 1.8% of net sales, compared to $13.1
million, or 1.1% of net sales for fiscal 1996. The increase in operating income
was due to an increase in gross profit partially offset by an increase in SG&A.
47
<PAGE>
INTEREST EXPENSE, NET. Interest expense, net for fiscal 1997 decreased $1.8
million to $5.0 million, compared to $6.8 million for fiscal 1996. The decrease
in interest expense, net was due to lower levels of indebtedness under
Delchamps' revolving credit line and lower levels of long-term indebtedness.
INCOME TAXES. The effective rate for income taxes for fiscal 1997 decreased
to 37.9% compared to 38.8% for fiscal 1996. The effective rate for fiscal 1997
approximates the combined federal and state statutory rates.
NET INCOME. Net income for fiscal 1997 increased $4.1 million to $8.0
million, compared to $3.9 million, for fiscal 1996. Excluding the effects of the
charge for the lawsuit settlement and gain from the sale of certain real
property, net income increased $5.6 million to $9.5 million for fiscal 1997,
compared to $3.9 million for fiscal 1996. The increase in net income was
primarily due to an increase in gross profit margins which resulted from
selected retail price adjustments and increased levels of promotional and buying
allowances and decreases in interest expense and effective rate for income taxes
as compared to fiscal 1996.
FISCAL 1996 VS. FISCAL 1995
NET SALES. Net sales for fiscal 1996 increased 6.9% to $1,126.6 million
compared to $1,054.1 million in fiscal 1995. The increase in net sales was
primarily due to the implementation of (i) a new merchandising program, (ii) a
new supermarket renovation program and (iii) new programs to improve customer
service. The new merchandising program (a) primarily reduced retail prices on
thousands of items, (b) increased the amount by which coupons are doubled from
$0.49 to $0.50 and (c) introduced a new advertising campaign to promote these
changes. The new supermarket renovation program affected 48 supermarkets and
included new decor packages, new in-store signage, painting, and for some
stores, new fixtures, cases, and shelving. New programs to improve customer
service included new training programs for all levels of store personnel, and
the enhancement of a field specialist program in which field specialists visit
perishable departments in all supermarkets to improve quality and freshness of
product, signage, and displays.
GROSS PROFIT. Gross profit for fiscal 1996 increased $7.6 million to $263.2
million, or 23.4% of net sales, compared to $255.6 million, or 24.2% of net
sales, for fiscal 1995. Gross profit increased primarily due to an increase in
net sales in fiscal 1996. The decrease in gross profit as a percentage of net
sales in fiscal 1996 was primarily due to the new merchandising program, in
which retail prices for thousands of items were reduced, which was implemented
for all of fiscal 1996 and was only in place for the last quarter of fiscal
1995. Assuming the reclassification of warehouse expenses from cost of sales to
SG&A, gross profit would have been $289.5 million, or 25.7% of net sales, for
fiscal 1996, compared to $279.7 million, or 26.5% of net sales, for fiscal 1995.
SG&A. SG&A expenses in fiscal 1995 included $28.8 million of restructuring
charges which were primarily due to leases for certain stores that were closed
in fiscal 1995 that could not be subleased in whole or in part, and a $5.1
million write-off of goodwill related to acquired assets which were consistently
producing negative results. Excluding such charges, SG&A expenses for fiscal
1996 decreased $6.6 million to $250.1 million, or 22.2% of net sales, compared
to $256.7 million, or 24.3% of net sales, for fiscal 1995. The decrease in SG&A
expenses was primarily due to a $5.4 million decrease in salaries and wages from
the implementation of a labor scheduling program. Assuming the reclassification
of warehouse expenses from cost of sales to SG&A, and excluding the
restructuring charge and write-off referred to above SG&A would have been $276.4
million, or 24.5% of net sales, for fiscal 1996, compared to $280.9 million, or
26.6% of net sales, for fiscal 1995.
OPERATING INCOME. Excluding the restructuring charges and write-off of
goodwill in fiscal 1995 described above, operating income for fiscal 1996
increased $14.3 million to $13.1 million, or 1.2% of net sales, compared to loss
of $1.2 million, or (0.9%) of net sales, for fiscal 1995. The increase in
operating income was due to an increase in gross profit and a reduction in SG&A
as described above.
INTEREST EXPENSE, NET. Interest expense, net for fiscal 1996 increased $1.5
million to $6.8 million, compared to $5.3 million for fiscal 1995. The increase
in interest expense, net was due to Delchamps' restructure obligation being
outstanding for all of fiscal 1996 compared to being outstanding for only the
fourth quarter of fiscal 1995.
48
<PAGE>
INCOME TAXES. The effective rate for income taxes for fiscal 1996 increased
to 38.8% compared to 36.3% for fiscal 1995. The increase in fiscal 1996 was due
to the expiration of the targeted jobs tax credit. The effective rate in fiscal
1996 approximates the combined federal and state statutory rates.
NET INCOME. Excluding the restructuring charges and write-off of goodwill
in fiscal 1995 described above, net income for fiscal 1996 increased $7.3
million to $3.9 million, compared to a net loss of $3.4 million, for fiscal
1995. The increase in net income was primarily due to an increase in gross
profit and decrease in SG&A partially offset by increases in interest expense,
net and effective rate for income taxes as compared to fiscal 1995.
LIQUIDITY AND CAPITAL RESOURCES
CAPITAL SPENDING
The following table shows capital expenditures during the last three fiscal
years, as well as the number of supermarkets that were opened, closed and
remodeled during that same period:
<TABLE>
<CAPTION>
1995 1996 1997
<S> <C> <C> <C>
Capital expenditures (millions).............................................................. $ 35.2 $ 21.7 $ 15.6
--------- --------- ---------
--------- --------- ---------
Supermarkets opened.......................................................................... 10 1 2
Supermarkets closed.......................................................................... 12 2 1
Remodels:
Expansions/remodels completed.......................................................... 5 1 5
Renovations completed.................................................................. -- 48 --
</TABLE>
FINANCING AND LIQUIDITY
Although Delchamps' supermarket locations are leased, Delchamps makes
substantial expenditures to equip new and expanded supermarkets. The cost to
equip a new supermarket is approximately $2.3 million while the additional cost
to equip an expanded supermarket is approximately $1.5 million. In addition,
Delchamps makes substantial expenditures for distribution center facilities and
equipment. Delchamps plans to finance its capital expenditures with funds
provided by operations. However, if an insufficient amount of funds in
generated, Delchamps may obtain long-term financing or draw on short-term credit
lines. Delchamps has a $75.0 million credit line from financial institutions of
which $70.4 million was available for future use at June 28, 1997. The credit
line is committed to Delchamps through June 1998.
Cash flow generated by operating activities was $25.2 million for fiscal
1995, $39.1 million for fiscal 1996 and $23.3 million for fiscal 1997. Cash
flows from operating activities decreased in fiscal 1997 as compared to fiscal
1996 primarily because of lower levels of accounts payable. Fiscal 1996
increased over fiscal 1995 because of improved earnings.
Cash used in investing activities was $34.6 million for fiscal 1995, $21.0
million for fiscal 1996 and $11.2 million for fiscal 1997. Cash was primarily
used for capital expenditures. Capital expenditures were $35.2 million for
fiscal 1995, $21.7 million for fiscal 1996 and $15.6 million for fiscal 1997.
During fiscal 1995, Delchamps purchased seven supermarkets from the Kroger Co.,
opened three supermarkets, remodeled five supermarkets, and purchased equipment
which had been previously leased at Delchamps' distribution facilities. During
fiscal 1996, Delchamps opened one supermarket, remodeled one supermarket,
renovated 42 supermarkets, purchased technology to enhance debit and credit
transactions, and purchased security systems for substantially all locations.
During fiscal 1997, Delchamps opened two new supermarkets and remodeled five
supermarkets.
Cash generated by financing activities was $10.0 million in fiscal 1995 and
cash used in financing activities was $23.5 million in fiscal 1996 and $17.0
million in fiscal 1997. The changes for all periods were the result of activity
under Delchamps' revolving loan agreement. At the end of fiscal 1997, the
Company was in compliance with all financial covenants under the revolving loan
agreement and its long-term debt agreement.
49
<PAGE>
THE EXCHANGE OFFER
TERMS OF THE EXCHANGE OFFER; PERIOD FOR TENDERING EXISTING NOTES
Upon the terms and subject to the conditions set forth in this Prospectus
and in the accompanying Letter of Transmittal (which together constitute the
Exchange Offer), the Company will accept for exchange Existing Notes which are
properly tendered on or prior to the Expiration Date and not withdrawn as
permitted below. As used herein, the term "Expiration Date" means 5:00 p.m., New
York City time, on December 10, 1997; provided, however, that if the Company has
extended the period of time for which the Exchange Offer is open, the term
"Expiration Date" means the latest time and date to which the Exchange Offer is
extended.
As of the date of this Prospectus, $200.0 million aggregate principal amount
of the Existing Notes are outstanding. This Prospectus, together with the Letter
of Transmittal, is first being sent on or about November 10, 1997 to all holders
of Existing Notes known to the Company. The Company's obligation to accept
Existing Notes for exchange pursuant to the Exchange Offer is subject to certain
conditions as set forth under "--Certain Conditions to the Exchange Offer"
below.
The Company expressly reserves the right, at any time or from time to time,
to extend the period of time during which the Exchange Offer is open, and
thereby delay acceptance for any exchange of any Existing Notes, by giving
notice of such extension to the holders thereof. During any such extension, all
Existing Notes previously tendered will remain subject to the Exchange Offer and
may be accepted for exchange by the Company. Any Existing Notes not accepted for
exchange for any reason will be returned without expense to the tendering holder
thereof as promptly as practicable after the expiration or termination of the
Exchange Offer.
The Company expressly reserves the right to amend or terminate the Exchange
Offer, and not to accept for exchange any Existing Notes not theretofore
accepted for exchange, upon the occurrence of any of the conditions of the
Exchange Offer specified below under "--Certain Conditions to the Exchange
Offer." The Company will give notice of any extension, amendment, non-acceptance
or termination to the holders of the Existing Notes as promptly as practicable,
such notice in the case of any extension to be issued no later than 9:00 a.m.,
New York City time, on the next business day after the previously scheduled
Expiration Date.
Holders of Existing Notes do not have any appraisal or dissenters' rights
under the Mississippi Business Corporation Act in connection with the Exchange
Offer.
PROCEDURES FOR TENDERING EXISTING NOTES
The tender to the Company of Existing Notes by a holder thereof as set forth
below and the acceptance thereof by the Company will constitute a binding
agreement between the tendering holder and the Company upon the terms and
subject to the conditions set forth in this Prospectus and in the accompanying
Letter of Transmittal. Except as set forth below, a holder who wishes to tender
Existing Notes for exchange pursuant to the Exchange Offer must transmit a
properly completed and duly executed Letter of Transmittal, including all other
documents required by such Letter of Transmittal, to Marine Midland Bank at the
address set forth below under "Exchange Agent" on or prior to the Expiration
Date. In addition, either (i) certificates for such Existing Notes must be
received by the Exchange Agent along with the Letter of Transmittal, or (ii) a
timely confirmation of a book-entry transfer (a "Book-Entry Confirmation") of
such Existing Notes, if such procedure is available, into the Exchange Agent's
account at The Depository Trust Company (the "Book-Entry Transfer Facility")
pursuant to the procedure for book-entry transfer described below, must be
received by the Exchange Agent prior to the Expiration Date, or the holder must
comply with the guaranteed delivery procedure described below. THE METHOD OF
DELIVERY OF EXISTING NOTES, LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED
DOCUMENTS IS AT THE ELECTION AND RISK OF THE HOLDER. IF
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SUCH DELIVERY IS BY MAIL, IT IS RECOMMENDED THAT REGISTERED MAIL, PROPERLY
INSURED, WITH RETURN RECEIPT REQUESTED, BE USED. IN ALL CASES, SUFFICIENT TIME
SHOULD BE ALLOWED TO ASSURE TIMELY DELIVERY. NO LETTERS OF TRANSMITTAL OR
EXISTING NOTES SHOULD BE SENT TO THE COMPANY.
Signatures on a Letter of Transmittal or a notice of withdrawal, as the case
may be, must be guaranteed unless the Existing Notes surrendered for exchange
pursuant thereto are tendered (i) by a registered holder of the Existing Notes
who has not completed the box entitled "Special Issuance Instruction" or
"Special Delivery Instruction" on the Letter of Transmittal or (ii) for the
account of an Eligible Institution (as defined below). In the event that
signatures on a Letter of Transmittal or a notice of withdrawal, as the case may
be, are required to be guaranteed, such guarantees must be by a firm which is a
member of a registered national securities exchange or a member of the National
Association of Securities Dealers, Inc. or by a commercial bank or trust company
having an office or correspondent in the United States (collectively, "Eligible
Institutions"). If Existing Notes are registered in the name of a person other
than a signer of the Letter of Transmittal, the Existing Notes surrendered for
exchange must be endorsed by, or be accompanied by a written instrument or
instruments of transfer or exchange, in satisfactory form as determined by the
Company in its sole discretion, duly executed by, the registered holder with the
signature thereon guaranteed by an Eligible Institution.
All questions as to the validity, form, eligibility (including time of
receipt) and acceptance of Existing Notes tendered for exchange will be
determined by the Company in its sole discretion, which determination shall be
final and binding. The Company reserves the absolute right to reject any and all
tenders of any particular Existing Notes not properly tendered or to not accept
any particular Existing Notes which acceptance might, in the judgment of the
Company or its counsel, be unlawful. The Company also reserves the absolute
right to waive any defects or irregularities or conditions of the Exchange Offer
as to any particular Existing Notes either before or after the Expiration Date
(including the right to waive the ineligibility of any holder who seeks to
tender Existing Notes in the Exchange Offer). The interpretation of the terms
and conditions of the Exchange Offer as to any particular Existing Notes either
before or after the Expiration Date (including the Letter of Transmittal and the
instructions thereto) by the Company shall be final and binding on all parties.
Unless waived, any defects or irregularities in connection with tenders of
Existing Notes for exchange must be cured within such reasonable period of time
as the Company shall determine. Neither the Company, the Exchange Agent nor any
other person shall be under any duty to give notification of any defect or
irregularity with respect to any tender of Existing Notes for exchange, nor
shall any of them incur any liability for failure to give such notification.
If the Letter of Transmittal or any Existing Notes or powers of attorney are
signed by trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, such persons should so indicate when signing, and, unless waived by
the Company, proper evidence satisfactory to the Company of their authority to
so act must be submitted.
By tendering, each holder of Existing Notes will represent to the Company
that, among other things, the New Notes acquired pursuant to the Exchange Offer
are being obtained in the ordinary course of business of the holder and any
beneficial holder, that neither the holder nor any such beneficial holder has an
arrangement or understanding with any person to participate in the distribution
of such New Notes and that neither the holder nor any such other person is an
"affiliate," as defined under Rule 405 of the Securities Act, of the Company. If
the holder is not a broker-dealer, the holder must represent that it is not
engaged in nor does it intend to engage in a distribution of the New Notes.
ACCEPTANCE OF EXISTING NOTES FOR EXCHANGE; DELIVERY OF NEW NOTES
For each Existing Note accepted for exchange, the holder of such Existing
Note will receive a New Note having a principal amount equal to that of the
surrendered Existing Note. For purposes of the
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Exchange Offer, the Company shall be deemed to have accepted properly tendered
Existing Notes for exchange when, as and if the Company has given oral and
written notice thereof to the Exchange Agent.
In all cases, issuance of New Notes for Existing Notes that are accepted for
exchange pursuant to the Exchange Offer will be made only after timely receipt
by the Exchange Agent of certificates for such Existing Notes or a timely
Book-Entry Confirmation of such Existing Notes into the Exchange Agent's account
at the Book-Entry Transfer Facility, a properly completed and duly executed
Letter of Transmittal and all other required documents. If any tendered Existing
Notes are not accepted for any reason set forth in the terms and conditions of
the Exchange Offer or if Existing Notes are submitted for a greater principal
amount than the holder desires to exchange, such unaccepted or non-exchanged
Existing Notes will be returned without expense to the tendering holder thereof
(or, in the case of Existing Notes tendered by book-entry transfer into the
Exchange Agent's account at the Book-Entry Transfer Facility pursuant to the
book-entry transfer procedures described below, such non-exchanged Existing
Notes will be credited to an account maintained with such Book-Entry Transfer
Facility) as promptly as practicable after the expiration of the Exchange Offer.
BOOK-ENTRY TRANSFER
Any financial institution that is a participant in the Book-Entry Transfer
Facility's systems may make book-entry delivery of Existing Notes by causing the
Book-Entry Transfer Facility to transfer such Existing Notes into the Exchange
Agent's account at the Book-Entry Transfer Facility in accordance with such
Book-Entry Transfer Facility's procedures for transfer. However, although
delivery of Existing Notes may be effected through book-entry transfer at the
Book-Entry Transfer Facility, the Letter of Transmittal or facsimile thereof
with any required signature guarantees and any other required documents must, in
any case, be transmitted to and received by the Exchange Agent at the address
set forth below under "Exchange Agent" on or prior to the Expiration Date or the
guaranteed delivery procedures described below must be complied with.
GUARANTEED DELIVERY PROCEDURES
If a registered holder of the Existing Notes desires to tender such Existing
Notes and the Existing Notes are not immediately available, or time will not
permit such holder's Existing Notes or other required documents to reach the
Exchange Agent before the Expiration Date, or the procedure for book-entry
transfer cannot be completed on a timely basis, a tender may be effected if (i)
the tender is made through an Eligible Institution, (ii) prior to the Expiration
Date, the Exchange Agent received from such Eligible Institution a properly
completed and duly executed Letter of Transmittal (or a facsimile thereof) and
Notice of Guaranteed Delivery, substantially in the form provided by the Company
(by telegram, telex, facsimile transmission, mail or hand delivery), setting
forth the name and address of the holder of Existing Notes and the amount of
Existing Notes tendered, stating that the tender is being made thereby and
guaranteeing that within five New York Stock Exchange ("NYSE") trading days
after the date of execution of the Notice of Guaranteed Delivery, the
certificates for all physically tendered Existing Notes, in proper form for
transfer, or a Book-Entry Confirmation, as the case may be, and any other
documents required by the Letter of Transmittal will be deposited by the
Eligible Institution with the Exchange Agent and (iii) the certificates for all
physically tendered Existing Notes, in proper form for transfer, or a Book-Entry
Confirmation, as the case may be, and all other documents required by the Letter
of Transmittal are received by the Exchange Agent within five NYSE trading days
after the date of execution of the Notice of Guaranteed Delivery.
WITHDRAWAL RIGHTS
Tenders of Existing Notes may be withdrawn at any time prior to the
Expiration Date. For a withdrawal to be effective, a written notice of
withdrawal must be received by the Exchange Agent at the address set forth below
under "Exchange Agent." Any such notice of withdrawal must specify the name of
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the person having tendered the Existing Notes to be withdrawn, identify the
Existing Notes to be withdrawn (including the principal amount of such Existing
Notes), and (where certificates for Existing Notes have been transmitted)
specify the name in which such Existing Notes are registered, if different from
that of the withdrawing holder. If certificates for Existing Notes have been
delivered or otherwise identified to the Exchange Agent then, prior to the
release of such certificates, the withdrawing holder must also submit the serial
numbers of the particular certificates to be withdrawn and a signed notice of
withdrawal with signatures guaranteed by an Eligible Institution unless such
holder is an Eligible Institution. If Existing Notes have been tendered pursuant
to the procedure for book-entry transfer described above, any notice of
withdrawal must specify the name and number of the account at the Book-Entry
Transfer Facility to be credited with the withdrawn Existing Notes and otherwise
comply with the procedures of such facility. All questions as to the validity,
form and eligibility (including time of receipt) of such notices will be
determined by the Company, whose determination shall be final and binding on all
parties. Any Existing Notes so withdrawn will be deemed not to have been validly
tendered for exchange for purposes of the Exchange Offer. Any Existing Notes
which have been tendered for exchange but which are not exchanged for any reason
will be returned to the holder thereof without cost to such holder (or, in the
case of Existing Notes tendered by book-entry transfer into the Exchange Agent's
account at the Book-Entry Transfer Facility pursuant to the book-entry transfer
procedures described above, such Existing Notes will be credited to an account
maintained with such Book-Entry Transfer Facility for the Existing Notes) as
soon as practicable after withdrawal, rejection of tender or termination of the
Exchange Offer. Properly withdrawn Existing Notes may be retendered by following
one of the procedures described under "--Procedures for Tendering Existing
Notes" above at any time on or prior to the Expiration Date.
CERTAIN CONDITIONS TO THE EXCHANGE OFFER
Notwithstanding any other provision of the Exchange Offer, the Company shall
not be required to accept for exchange, or to issue New Notes in exchange for,
any Existing Notes and may terminate or amend the Exchange Offer if at any time
before the acceptance of such Existing Notes for exchange or the exchange of New
Notes for such Existing Notes, the Company determines that the Exchange Offer
violates applicable law or any applicable interpretation of the staff of the
Commission.
The foregoing conditions are for the sole benefit of the Company and may be
asserted by the Company regardless of the circumstances giving rise to any such
condition or may be waived by the Company in whole or in part at any time and
from time to time in its reasonable discretion. The failure by the Company at
any time to exercise any of the foregoing rights shall not be deemed a waiver of
such right and each such right shall be deemed an ongoing right which may be
asserted at any time and from time to time.
In addition, the Company will not accept for exchange any Existing Notes
tendered, and no New Notes will be issued in exchange for any such Existing
Notes, if at such time any stop order shall be threatened or in effect with
respect to the Registration Statement of which this Prospectus constitutes a
part or the qualification of the Indenture under the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"). In any such event the Company is
required to use every reasonable effort to obtain the withdrawal of any stop
order at the earliest possible time.
EXCHANGE AGENT
Marine Midland Bank has been appointed as the Exchange Agent for the
Exchange Offer. All executed Letters of Transmittal should be directed to the
Exchange Agent at the address set forth below. Questions and requests for
assistance, requests for additional copies of this Prospectus or of the Letter
of Transmittal and requests for Notices of Guaranteed Delivery should be
directed to the Exchange Agent addressed as follows:
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BY MAIL, OVERNIGHT COURIER OR HAND:
Marine Midland Bank
140 Broadway, Level A
New York, New York 10005-1180
Attention: Corporate Trust Operations
BY FACSIMILE:
(212) 658-2292
CONFIRM BY TELEPHONE:
(212) 658-5931
Delivery other than as set forth above will not constitute a valid delivery.
FEES AND EXPENSES
The Company will not make any payments to brokers, dealers or others
soliciting acceptances of the Exchange Offer. The principal solicitation is
being made by mail; however, additional solicitations may be made in person or
by telephone by officers and employees of the Company.
The expenses to be incurred in connection with the Exchange Offer will be
paid by the Company. Such expenses include fees and expenses of the Exchange
Agent and Trustee, accounting and legal fees and printing costs, among others.
ACCOUNTING TREATMENT
The New Notes will be recorded at the same carrying value as the Existing
Notes, which is the principal amount as reflected in the Company's accounting
records on the date of the exchange. Accordingly, no gain or loss for accounting
purposes will be recognized. The debt issuance costs will be capitalized for
accounting purposes.
TRANSFER TAXES
Holders who tender their Existing Notes for exchange will not be obligated
to pay any transfer taxes in connection therewith, except that holders who
instruct the Company to register New Notes in the name of, or request that
Existing Notes not tendered or not accepted in the Exchange Offer be returned
to, a person other than the registered tendering holder will be responsible for
the payment of any applicable transfer tax thereon.
CONSEQUENCES OF FAILURE TO EXCHANGE; RESALES OF NEW NOTES
Holders of Existing Notes who do not exchange their Existing Notes for New
Notes pursuant to the Exchange Offer will continue to be subject to the
restrictions on transfer of such Existing Notes as set forth in the legend
thereon as a consequence of the issuance of the Existing Notes pursuant to the
exemptions from, or in transactions not subject to, the registration
requirements of, the Securities Act and applicable state securities laws.
Existing Notes not exchanged pursuant to the Exchange Offer will continue to
accrue interest at 10 3/8% per annum and will otherwise remain outstanding in
accordance with their terms. Holders of Existing Notes do not have any appraisal
or dissenters' rights under the Mississippi Business Corporation Act in
connection with the Exchange Offer. In general, the Existing Notes may not be
offered or sold unless registered under the Securities Act, except pursuant to
an exemption from, or in a transaction not subject to, the Securities Act and
applicable state securities laws. The Company does not currently anticipate that
it will register the Existing Notes under the Securities Act. However, if (i)
the Company is not permitted to consummate the Exchange Offer because the
Exchange Offer is not permitted by applicable law or Commission policy or (ii)
any holder of Transfer Restricted Securities
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notifies the Company within the specified time period that (A) it is prohibited
by law or Commission policy from participating in the Exchange Offer or (B) that
it may not resell the New Notes acquired by it in the Exchange Offer to the
public without delivering a prospectus and this Prospectus is not appropriate or
available for such resales or (C) that it is a broker-dealer and owns Existing
Notes acquired directly from the Company or an affiliate of the Company, the
Company will file with the Commission a shelf registration statement to cover
resales of Transfer Restricted Securities by the holders thereof who satisfy
certain conditions relating to the provision of information in connection with
the shelf registration statement. For purposes of the foregoing, "Transfer
Restricted Securities" means each Note until the earlier of (i) the date on
which such Note has been exchanged by a person other than a broker-dealer for a
New Note in the Exchange Offer, (ii) following the exchange by a broker-dealer
in the Exchange Offer of an Existing Note for a New Note, the date on which such
New Note is sold to a purchaser who receives from such broker-dealer on or prior
to the date of such sale a copy of this Prospectus, (iii) the date on which such
Note has been effectively registered under the Securities Act and disposed of in
accordance with the shelf registration statement or (iv) the date on which such
Note is distributed to the public pursuant to Rule 144 under the Act.
Based on certain interpretive letters issued by the staff of the Commission
to third parties in unrelated transactions, the Company is of the view that New
Notes issued pursuant to the Exchange Offer may be offered for resale, resold or
otherwise transferred by holders thereof (other than (i) any such holder which
is an "affiliate" of the Company within the meaning of Rule 405 under the
Securities Act or (ii) any broker-dealer that purchases Notes from the Company
to resell pursuant to Rule 144A or any other available exemption) without
compliance with the registration and prospectus delivery provisions of the
Securities Act, provided that such New Notes are acquired in the ordinary course
of such holders' business and such holders have no arrangement or understanding
with any person to participate in the distribution of such New Notes. If any
holder has any arrangement or understanding with respect to the distribution of
the New Notes to be acquired pursuant to the Exchange Offer, such holder (i)
could not rely on the applicable interpretations of the staff of the Commission
and (ii) must comply with the registration and prospectus delivery requirements
of the Securities Act in connection with a secondary resale transaction. A
broker-dealer who holds Existing Notes that were acquired for its own account as
a result of market-making or other trading activities may be deemed to be an
"underwriter" within the meaning of the Securities Act and must, therefore,
deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of New Notes. Each such broker-dealer that receives
New Notes for its own account in exchange for Existing Notes, where such
Existing Notes were acquired by such broker-dealer as a result of market-making
activities or other trading activities, must acknowledge in the Letter of
Transmittal that it will deliver a prospectus in connection with any resale of
such New Notes. See "Plan of Distribution."
In addition, to comply with the securities laws of certain jurisdictions, if
applicable, the New Notes may not be offered or sold unless they have been
registered or qualified for sale in such jurisdictions or an exemption from
registration or qualification is available and is complied with. The Company has
agreed, pursuant to the Registration Rights Agreement and subject to certain
specified limitations therein, to register or qualify the New Notes for offer or
sale under the securities or blue sky laws of such jurisdictions as any holder
of the Notes reasonably requests in writing.
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BUSINESS
GENERAL
The Company is a leading operator of supermarkets in the Southeast. Upon
consummation of the Delchamps Acquisition, the Company will operate 199
supermarkets located throughout Mississippi and Alabama as well as in selected
markets in Tennessee, Arkansas, Louisiana and Florida. In addition, the Company
will be the largest supermarket operator in Mississippi and the second largest
supermarket operator in Alabama, with 81 supermarkets in Mississippi and 49
supermarkets in Alabama. The Company will account for an estimated 32% of the
grocery sales in Mississippi and an estimated 18% of the grocery sales in
Alabama. Jitney-Jungle currently has an estimated 50% of the grocery sales in
Jackson, Mississippi and Delchamps has an estimated 37% of the grocery sales in
Mobile, Alabama. Jitney-Jungle and Delchamps also have the number one, two or
three market share position in approximately 80% of the major markets in which
they operate. The Delchamps Acquisition is expected to increase the Company's
geographic diversification because the Delchamps stores are primarily located in
areas in which Jitney-Jungle currently has no stores. At the same time, the
Delchamps Acquisition is expected to result in valuable purchasing, distribution
and marketing synergies for the Company. On a Pro Forma Basis, the Company would
have had approximately $2.2 billion of net sales and approximately $127.8
million of EBITDA for the LTM Period.
Management believes that the Company has significant competitive advantages,
which include:
STRONG FRANCHISE AND PRIME SITES. The Company has a strong consumer
franchise built around the "Jitney-Jungle" and "Delchamps" names. Management
believes that the Company's customers associate these names with quality, value,
convenience and superior service. In addition, Management believes that most of
the Company's urban supermarkets are in high-traffic locations that offer
significant competitive advantages, and that many of its supermarkets located in
smaller towns and rural areas are located on prime, non-replicable sites.
MODERN SUPERMARKET BASE. During the last five fiscal years, Jitney-Jungle
and Delchamps invested approximately $147.0 million and $111.0 million,
respectively, in capital expenditures, a substantial majority of which was for
building new supermarkets and expanding or remodeling existing supermarkets.
Approximately 81% of the Company's supermarket base has been built or remodeled
within the past five fiscal years.
SUCCESSFUL PRIVATE LABEL PROGRAM. In addition to branded products, the
Company's supermarkets offer a selection of private label products bearing the
brand names of Topco, the largest cooperative grocery products purchasing
organization in the United States. The Company's affiliation with Topco enables
it to procure quality merchandise on a competitive basis with larger, national
food retailers. Pro forma net sales of private label products, which generally
have a lower unit sales price than national brands but provide a higher gross
margin due to lower unit costs, accounted for approximately 18.2% of pro forma
net non-perishable sales of the Company during the LTM Period.
CENTRALIZED AND EFFICIENT DISTRIBUTION FACILITIES. The Company's
distribution facility located in Jackson, Mississippi is conveniently located
close to major highways and provides a central delivery site for vendors. This
facility includes an aggregate of 814,000 square feet of warehouse space and can
efficiently supply the Company's 199 supermarkets, as well as potential new
markets contiguous to existing markets.
ANTICIPATED COST SAVINGS
During fiscal 1997, Delchamps generated net sales and EBITDA of
approximately $1.1 billion and $44.1 million, respectively. In addition to the
incremental net sales, EBITDA and market share expected to result from the
Delchamps Acquisition, Management believes that it should be able to achieve
significant
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cash cost savings as a result of the elimination of certain duplicative costs,
increased operating efficiencies and increased purchasing leverage in connection
with the combined operation of the Jitney-Jungle and Delchamps businesses
following the Delchamps Acquisition. While the exact timing and amount of such
cash cost savings is inherently uncertain, Management currently expects that the
Company should begin to realize such cash cost savings within three to nine
months after the Delchamps Acquisition. Specific anticipated benefits of the
Delchamps Acquisition include:
REDUCED GENERAL AND ADMINISTRATIVE EXPENSE. In connection with the
Delchamps Acquisition, Management expects to consolidate the corporate
headquarters of the Company's combined operations in the existing corporate
headquarters of Jitney-Jungle. Although divisional offices will be opened in
Mobile, Alabama, the Delchamps Mobile headquarters will be closed and
approximately 160 positions currently held by employees at the Jitney-Jungle and
Delchamps corporate headquarters will be eliminated. Management estimates that
such measures should result in approximately $9.3 million of annualized cash
cost savings, which the Company should begin to realize within three to six
months following the Delchamps Acquisition.
IMPROVED WAREHOUSING AND DISTRIBUTION EFFICIENCIES. Jitney-Jungle owns or
leases 814,000 square feet of warehouse space located in Jackson, Mississippi
which is central to, and can efficiently supply, all of the Company's 199
supermarkets. In connection with the Delchamps Acquisition, Management expects
to close the Hammond, Louisiana warehouse owned by Delchamps and to utilize
Jitney-Jungle's Jackson facility as the Company's central distribution center,
thereby reducing headcount and general and administrative expenses. In addition,
in order to more efficiently utilize the Jackson facility Jitney-Jungle has
negotiated a long-term supply agreement with a supplier to provide direct store
delivery of slow moving items to the Company's supermarkets, which Management
believes should result in lower distribution costs and a decrease of
approximately 35% in inventory levels. Management believes that, on an
annualized basis, the combined effect of these warehousing and distribution
efficiencies should result in approximately $3.9 million of cash cost savings,
which the Company should begin to realize within three to six months following
the Delchamps Acquisition.
REDUCED ADVERTISING AND PRINTING EXPENSES. Jitney-Jungle and Delchamps
operate in contiguous and overlapping geographic areas, particularly in south
Mississippi and Florida. As a result, Management believes that it will be able
to consolidate the Company's advertising in these regions, thus reducing
advertising expenses. In addition, while Delchamps currently outsources the
printing of its advertising circulars, after the Delchamps Acquisition
approximately 50% of such printing will be performed at Jitney-Jungle's in-house
printing facility. Management estimates that moving a portion of Delchamps'
printing in-house should result in annualized cash cost savings of approximately
$1.0 million, which the Company should begin to realize within three to six
months following the Delchamps Acquisition.
INCREASED PURCHASING LEVERAGE. Management expects that Jitney-Jungle's
merchandise purchases will approximately double following the Delchamps
Acquisition. As a result of this increase and the Company's leading market
position, Management believes that the Company should be able to negotiate more
favorable terms from vendors, including suppliers of products carried on an
exclusive or promoted basis, and to convert some less-than-truckload shipping
quantities to full truckload quantities. Management believes that this increased
purchasing leverage should result in approximately $3.4 million in annualized
cash cost savings, which the Company should begin to realize within six to nine
months following the Delchamps Acquisition.
INCREASED BACKHAUL INCOME. The expected increase in merchandise purchases
following the Delchamps Acquisition and the resulting improvements in the
Company's purchasing leverage are expected to create additional opportunities to
increase backhaul income, thereby reducing the Company's operating costs. In
particular, the Company's increased presence in the Louisiana and Florida
markets should result in a higher number of deliveries to those areas, which
have historically provided Jitney-Jungle with backhaul opportunities. Management
believes that increased backhaul income should result in
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annualized cash cost savings of approximately $1.8 million, which the Company
should begin to realize within three to six months following the Delchamps
Acquisition.
Of the aggregate potential $19.4 million in annualized cash cost savings
discussed above, approximately $14.2 million are reflected in the Pro Forma
Condensed Consolidated Financial Statements included elsewhere herein because
Management believes that they are factually supportable and directly related to
the Transactions and the Delchamps Merger. Actual cash cost savings achieved by
the Company may vary considerably from the estimates discussed above. See 'Risk
Factors--Integration of Delchamps.'
BUSINESS STRATEGY
The Company's business strategy is focused on enhancing the Company's
revenues and profitability by capitalizing on its leading market positions and
continuing its growth in certain attractive Southeast markets. Management
believes that the Company's leading perishables and grocery merchandising,
competitive pricing, range of specialty departments and reputation for quality
will help the Company continue its strong history of growth and profitability.
The Company's specific business strategies include:
EXPAND SUPERMARKET BASE. Management believes there are a number of
attractive Southeast markets in which to continue to grow the Company's
supermarket base. Jitney-Jungle has a history of successfully making supermarket
acquisitions in both existing and contiguous markets. Since fiscal l990,
Jitney-Jungle has acquired 51 supermarkets in 41 markets, excluding the 100
supermarkets to be acquired in the Delchamps Acquisition. In addition, over the
past five fiscal years the Company has built or expanded 58 supermarkets in the
Southeast. To continue expanding its supermarket base, Management intends to
open new supermarkets and make strategic acquisitions in certain of the larger
metropolitan areas where it currently operates (including Memphis and Little
Rock), as well as in smaller cities and surrounding areas that are contiguous to
areas where it currently operates.
CONTINUE TO IMPROVE OPERATING MARGINS. Jitney-Jungle and Delchamps have
improved their EBITDA margins from 5.5% and 2.9%, respectively, in fiscal 1992
to 5.7% and 4.0%, respectively, in fiscal 1997. The Company continuously reviews
its operations to identify initiatives designed to reduce operating costs and
increase EBITDA margins. As a result of the following initiatives, Management
believes that the Company can further improve its EBITDA margins during fiscal
1998: (i) headcount reductions implemented by Jitney-Jungle in May 1997, which
are expected to result in annualized cost savings of approximately $0.9 million
in fiscal 1998; and (ii) improved labor scheduling currently being implemented
at Jitney-Jungle supermarkets, which is expected to result in annualized cost
savings of approximately $3.5 million in fiscal 1998 and which may also result
in additional cost savings when implemented during the next 12 to 18 months at
the Delchamps supermarkets. In addition, Management expects to implement
programs at Delchamps to reduce inventory shrink to levels comparable to those
achieved at Jitney-Jungle.
DECREASE WORKING CAPITAL NEEDS. During fiscal 1997, Jitney-Jungle
successfully implemented programs to reduce inventories by eliminating slow
moving items, as well as renegotiating its payment terms to bring them more in
line with industry practice. As a result of these efforts, Jitney-Jungle
improved its ratio of accounts payable to inventory from 51.7% in fiscal 1996 to
77.3% in fiscal 1997. Jitney-Jungle believes that these measures enabled it to
decrease its working capital needs by approximately $20.0 million. Management
intends to implement similar programs at Delchamps.
CAPITALIZE ON MARKET SEGMENTATION OPPORTUNITIES. The Company attempts to
optimize operating results by selecting a format for each of its supermarkets
that is best suited to a site's demographics, local preferences and competitive
position. The Company's conventional supermarkets offer a range of departments
and high-quality services; the Company's combination supermarkets offer a
combined supermarket and drug format with a wider variety of premium,
full-service departments, merchandise and services; and the Company's discount
supermarkets offer items throughout the supermarket at everyday low prices and
generally place greater emphasis on self-service. In general, the Company's
conventional and combination
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supermarkets generate higher operating margins than its discount supermarkets.
Management believes that there is a growing consumer demand for higher service
levels and convenience and, as a result, expects that the Company will open
combination supermarkets in preference to conventional and discount supermarkets
at all sites where adequate space and consumer demand exist. Management also
expects that a significant number of conventional and discount formats will be
converted to combination formats. In addition, because the Company's discount
supermarkets attract a price sensitive customer who generally would not shop at
a combination or conventional supermarket, Management also believes there will
be opportunities to open new discount supermarkets in areas where limited or no
competing discount supermarkets operate (including Mobile and New Orleans), with
minimal risk of cannibalizing sales of the Company's conventional and
combination supermarkets located in those areas.
PURSUE INNOVATIVE MARKET INITIATIVES. The Company's goal is to utilize
innovative marketing and advertising programs to increase sales while
maintaining or increasing profitability. At its conventional and combination
stores, Jitney-Jungle has introduced a frequent shopper program utilizing a
"Gold Card" designed to increase customer traffic and net sales by offering
incentives to its most loyal customers. The "Gold-Card" entitles holders to
discounts on certain products every week as well as check cashing privileges,
and also serves as a base for market basket analysis and customer-oriented
direct marketing. Since the introduction of the Gold Card, Management believes
that the number of customers and the amount of the average purchase at
Jitney-Jungle supermarkets has increased and, as a result, Management intends to
introduce a similar frequent shopper card at Delchamps supermarkets following
the Delchamps Acquisition. At its discount supermarkets, the Company employs
marketing campaigns designed to appeal to the value conscious consumer,
including "truckload sales," private label promotions and bulk produce and
similar purchasing incentives.
FOCUS ON "PUMP AND SAVE" GASOLINE STATION OPPORTUNITIES. The Company
operates gasoline stations under the name "Pump And Save" at or near 53 of its
supermarkets that offer attractive gasoline retailing sites on heavily traveled
roads and highways. The Company entered the gasoline business to take advantage
of (i) the low incremental capital costs of building gasoline stations on its
supermarket parking lots and (ii) the efficiencies associated with operating
gasoline stations with the same management and labor as its supermarkets. The
Company has opened 25 new gasoline stations over the last five fiscal years and
plans to continue this growth with expansion at many of the 100 Delchamps
supermarkets.
GROWING SOUTHEAST MARKET AREA
The Southeast is one of the fastest growing regions in the United States in
terms of population, income and employment. According to the Bureau of the
Census, the population of the Southeast has increased at an annual rate of 1.6%
since 1990, compared to the national average of 1.2% over the same period.
Furthermore, the Southeast has experienced faster growth than the United States
since 1990 in terms of per capita income (4.9% versus 4.1%) and overall
employment (2.3% versus 1.4%). Since all of the Company's existing supermarkets
and planned new supermarkets will be in the Southeast, the Company believes that
it will continue to benefit from the economic strength of this region.
Nevertheless, individual markets or regions within the Southeast where the
Company operates may experience economic and demographic trends which differ
from those of the region as a whole. Notwithstanding growth in these markets,
during the past three years an overall lack of inflation in food prices and
increasingly competitive markets have made it difficult for supermarket
operators to achieve comparable store sales gains. Because sales growth has been
difficult to attain, many operators, including the Company, have attempted to
maintain market share through increased levels of promotional activities and
discount pricing, creating a more difficult environment in which to increase
year-over-year sales gains consistently. In addition, because of growth in the
Southeast, where all of the Company's supermarkets are located, many existing
operators, including the Company, have opened new supermarkets in existing
markets. This has resulted in declines in some same store sales for the existing
(comparable) store base of the Company as well as other grocery chains.
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SUPERMARKET FORMATS
The Company attempts to optimize operating results by selecting a format for
each supermarket that is best suited to a locality's demographics, local
preferences and competitive positioning. In this respect, Management believes
that its local market knowledge and community awareness are major competitive
advantages. Each district manager and supermarket manager will have significant
responsibility for merchandising each individual supermarket in a manner that
caters specifically to its local customer base. In recent years, the Company has
devoted a greater proportion of its new or remodeled supermarket space to fresh,
high-quality perishables such as produce, delicatessen items, baked goods,
prepared foods, fresh seafood and floral items, and to convenience-oriented
services such as pharmacies and video and carpet-cleaning equipment rentals.
Management believes that the Company's fresh produce presentation and its
delicatessens which serve over 100,000 hot meals weekly, in particular, are
competitive advantages and represent important attractions for customers.
The Company currently operates its supermarkets in three supermarket format
categories: (i) the combination food and drug format, which offers a wide
variety of premium, full-service departments, merchandise and services as well
as a broad range of non-perishable products; (ii) the conventional format, which
offers a range of departments and high-quality services; and (iii) the discount
supermarket format, which offers items throughout the supermarket at every day
low prices and generally places greater emphasis on self-service. While the
combination and conventional formats use a higher margin pricing strategy
appropriate for a more service-oriented customer base, the discount format uses
a higher volume, lower margin strategy appropriate for a more price-conscious
customer base.
COMBINATION SUPERMARKETS. In 1993, the Company opened its first combination
supermarket, a 57,276 square foot "Jitney-Premier" in Jackson which features
enhanced specialty departments and perishables presentations as well as a food
court. This supermarket was named "Supermarket of the Year" by Chain Store Age
Executive. The Company currently operates seven combination supermarkets,
averaging approximately 56,000 square feet. Pro forma net sales from combination
supermarkets were approximately $121.8 million in the LTM Period, which
represented approximately 5.6% of the Company's pro forma net sales for that
period.
The Company's combination supermarkets utilize a "Hi-Lo" pricing strategy
(featuring competitive prices on all product offerings as well as a selection of
items that are promoted at lower prices to generate increased customer traffic),
and are open 24-hours a day, seven days a week. Management believes that its
combination supermarkets will enable the Company to increase customer loyalty by
offering competitively priced merchandise, including expanded general and
specialty merchandise, a wider range of full-service departments such as branch
banking facilities, expanded beauty care and pharmacy departments, and superior
customer service.
In light of the perceived growth in consumer demand for higher service
levels and convenience, Management has adopted the combination food and drug
format as its primary base supermarket for the future at sites where adequate
space and consumer demand exist. Management plans to convert three conventional
stores and one discount store to combination stores by the end of calendar year
1997. Management also will consider strategic conversions of up to 20
Jitney-Jungle conventional and discount stores to the combination format, and
has identified approximately 30 Delchamps' supermarkets as potentially
convertible to the combination supermarket format because of their size and
location in high traffic, metropolitan areas where customers are generally more
receptive to the combination format.
CONVENTIONAL SUPERMARKETS. The Company operates 171 conventional
supermarkets. Pro Forma net sales from these supermarkets were approximately
$1.5 billion in the LTM Period, which represented approximately 69.8% of the
Company's pro forma net sales for that period. All of the Company's conventional
supermarkets utilize the "Hi-Lo" pricing strategy and are market leaders in many
of their trade areas. The average size of the conventional supermarket is
approximately 35,000 square feet.
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DISCOUNT SUPERMARKETS. The Company currently operates 21 discount
supermarkets primarily under the name "Sack and Save." Pro Forma net sales from
these supermarkets were approximately $429.8 million in the LTM Period, which
represented approximately 19.8% of the Company's pro forma net sales for that
period. The average size of the discount supermarket is approximately 60,000
square feet.
The Company's discount supermarkets utilize an everyday low price strategy
(featuring consistently low prices aimed at the value-conscious shopper). These
supermarkets use the slogan "Lowest Food Prices in the South" and provide
national brand and private label items at everyday low prices. Merchandising
programs carried on by those supermarkets include: (i) "Made in the South"
sales; (ii) truckload sales of paper products, detergents and similar volume
items; (iii) canned meat sales; (iv) private label merchandise promotions; and
(v) bulk produce merchandising in pallet quantities. The discount supermarkets
have lower operating costs than the combination and conventional supermarkets
due to fewer service departments, lower customer service levels and enhanced
productivity methods.
Approximately half of the Company's discount supermarkets are located in the
metropolitan areas of Jackson, Memphis and Little Rock. Management believes that
these discount supermarkets attract a price sensitive customer who generally
would not shop the combination or conventional supermarket, thereby minimizing
the cannibalizing of sales in the Company's nearby combination and conventional
supermarkets. In those discount locations where the Company has perceived
relatively higher demand for service among its customers, it has made strategic
conversions from the discount format to the conventional or combination format,
as appropriate, given the size of a particular market. Since the end of fiscal
1997, the Company has converted five supermarkets formerly operated as discount
supermarkets; two were converted to conventional supermarkets and three were
converted to combination supermarkets. Another conversion is planned for the end
of calendar year 1997. By contrast, Management believes that there are discount
supermarket expansion opportunities in areas where limited or no competing
discount supermarkets operate, including Mobile, New Orleans and Birmingham.
GASOLINE STATIONS
Through a subsidiary, the Company operates 53 gasoline stations under the
"Pump And Save" name. The stations are generally located on parking lots in
front of the Company's supermarkets and provide an additional service for its
customers. Because the gasoline stations are in close proximity to the
supermarkets, they benefit from the high volume supermarket traffic and can be
operated with the same management and labor as the Company's supermarkets. In
the LTM Period, gasoline station sales were approximately $86.5 million, which
represented approximately 4.0% of the Company's pro forma net sales for that
period. Management believes that there will be similar opportunities to open
gasoline stations in the proximity of many Delchamps supermarkets, which
currently do not have gasoline station operations.
LIQUOR STORES AND CIGARETTE SALES
The Company operates ten liquor stores in the state of Florida, which are
located adjacent to the Company's supermarkets. In the LTM Period, liquor store
sales were approximately $17.3 million, which represented approximately 0.8% of
the Company's pro forma net sales for that period. In addition, a wholly-owned
subsidiary of the Company functions as the purchasing agent and distributor for
cigarettes sold by certain of the Company's supermarkets.
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MARKETS AND COMPETITION
The Company holds the number one, two or three market share position in
approximately 80% of the major markets in which it operates. The Company
attributes this success to: (i) its strong franchise and prime sites; (ii) its
modern supermarket base; (iii) its successful private label program; and (iv)
its centralized and efficient distribution facilities. Given these strengths,
Management believes the Company is well positioned to retain its market
leadership.
The supermarket business is intensely competitive. The number of competitors
and the amount of competition experienced by the Company's supermarkets vary by
location. Principal competitive factors include supermarket location, price,
service, convenience, cleanliness and product quality and variety. Because the
supermarket business is characterized by narrow profit margins, the Company's
earnings depend primarily on the efficiency of its operations and its ability to
maintain a large sales volume. Management believes that the Delchamps
Acquisition should enhance the Company's ability to compete with its largest
competitors, and will result in opportunities to increase market share in
Memphis, Little Rock, Birmingham, Mobile and New Orleans.
The Company's primary markets are Jackson, Mississippi and Mobile, Alabama.
During the LTM Period, Jitney-Jungle's three combination supermarkets, 17
conventional supermarkets and three discount supermarkets located in Jackson
represented a market share of approximately 50% in that area, and Delchamps' two
combination supermarkets and 17 conventional supermarkets located in Mobile
represented a share of approximately 37% in that market. The Company also has
growing market share in the metropolitan markets of Little Rock, Memphis and New
Orleans, which in the LTM Period was approximately 13%, 8% and 9%, respectively.
The Company's principal competitors are Kroger's (in Alabama, Mississippi,
Tennessee and Arkansas), Food World/Bruno's (in Alabama, Florida and
Mississippi), Wal-Mart Supercenters (in Alabama, Arkansas, Florida, Louisiana,
Mississippi and Tennessee), Winn Dixie (in Alabama, Florida, Louisiana and
Mississippi) and Albertson's (in Alabama, Florida, Louisiana and Mississippi).
The Company's supermarkets also compete with other regional and national
supermarket chains as well as local chains and independent, specialty and
convenience food stores that have significant market shares in limited areas,
such as the Schwegmann Giant Supermarkets chain in Southeastern Louisiana and
Seessels/Bruno's in Tennessee. In addition, the Company's principal competitors
in the Florida pandhandle region and the Mississippi Gulf Coast include the
commissaries at the U.S. military bases in Pensacola, Florida and Biloxi,
Mississippi.
PURCHASING AND MERCHANDISING
The Company's principal merchandising strategies are to promote an "overall
value" image and to achieve high sales volume by offering quality products and
services at competitive prices. The Company's supermarkets carry fresh meat and
produce, frozen and other convenience foods, dairy products, specialty and
gourmet products, and general grocery products, as well as selected lines of
non-grocery merchandise. Most supermarkets opened and remodeled during the last
several years contain bakeries and delicatessens, which offer prepared
ready-to-eat foods, service meat departments, seafood departments and video
departments. The Company also operates pharmacies at selected locations.
The Company has established strong relationships with a variety of major
manufacturers over many years, none of which represents a major source of supply
to the Company. Since the Company's supermarkets carry many of the same
products, centralized purchasing and distribution facilities are essential. All
purchases are made under central buying procedures, rather than on a
store-by-store basis, which allows the Company to maintain quality control of
its products and to take advantage of volume discounts, more favorable payment
terms and more frequent inventory turns. Following the Delchamps Acquisition,
Management expects that the Company's merchandise purchases will approximately
double. As a result of this increase in the Company's combined volume
requirements and its leading market
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position, Management believes that the Company should be able to negotiate more
favorable terms from vendors.
PRIVATE LABEL PROGRAM
The Company's supermarkets offer a selection of national and regional
brand-name products, generic products and products bearing brand names of Topco,
a cooperative purchasing organization of which both Jitney-Jungle and Delchamps
are shareholding members. The Company's affiliation with Topco, the largest
cooperative grocery products purchasing organization in the United States,
enables it to procure quality merchandise on a competitive basis with larger,
national food retailers. Topco's membership of 30 retail grocery chains and
wholesalers located throughout the United States enables it to employ large
volume buying techniques on behalf of its members. Topco products are sold under
its own brand names, such as "Food Club," "Topco," "Top Fresh" and "Top Frost,"
or under generic labels. The Company also recently began using a "Delchamps"
label to replace the Topco labels on certain products.
Private label products generally have a lower unit sales price than national
brands but provide a higher gross margin due to lower unit costs. Pro forma net
sales of private label products accounted for approximately 18.2% of pro forma
net non-perishable sales of the Company during the LTM Period.
ADVERTISING AND MARKETING
The Company features nationally advertised and distributed merchandise, and
also markets both food and non-food products under a private label program. The
Company's advertising programs are designed to reinforce for the customer its
low prices, high-quality selection and convenience. In each of its major
markets, the Company advertises through various media including circulars,
newspapers, radio and television. Prior to July 1997, print media was the
primary form of advertising and was used extensively on a weekly basis to
advertise featured items; however, in July 1997 the Company began shifting a
significant portion of its total advertising expenditures to television and
radio media, focusing on a quality and service image, in order to reach a wider
target audience. The Company's in-house capabilities include an advertising
department, which handles most creative work, and the printing of over 1.7
million pieces of print media per week in the Company's full-line print shop.
Management intends to print approximately 0.9 million pieces of print media per
week for the Delchamps stores after the Delchamps Acquisition. Advertising
costs, net of advertising allowances, constituted less than 1.0% of net sales in
the LTM Period.
Various sales enhancement promotional activities, including coupons and
special pricing discounts, are currently conducted under the Company's frequent
shopper program. At its conventional and combination stores, the Company has
introduced (or, in the case of the Delchamps supermarkets, expects to introduce)
a frequent shopper program utilizing a "Gold Card" designed to increase customer
traffic and net sales by offering incentives to the Company's most loyal
customers. The "Gold Card" entitles holders to discounts on certain products
every week as well as check cashing privileges, and also serves as a base for
market basket analysis and customer-oriented direct marketing. Since the
introduction of the Gold Card, Management believes that the number of customers
and the amount of the average purchase has increased at Jitney-Jungle
supermarkets and, as a result, Management intends to introduce a similar
frequent shopper card at Delchamps supermarkets following the Delchamps
Acquisition. At its discount supermarkets, the Company employs marketing
campaigns designed to appeal to the value-conscious consumer including truckload
sales, private label promotions and similar purchasing incentives.
WAREHOUSING AND DISTRIBUTION
Jitney-Jungle owns or leases 814,000 square feet of warehouse space located
in Jackson, Mississippi which is central to, and can efficiently supply, all of
the Company's 199 supermarkets. In connection with the Delchamps Acquisition,
Management expects to close the Hammond, Louisiana warehouse owned by Delchamps
and to utilize Jitney-Jungle's Jackson facility as the Company's central
distribution center, thereby reducing headcount and general and administrative
expenses. In addition, in order to more efficiently utilize the Jackson
facility, Jitney-Jungle has negotiated a long-term supply agreement with
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SUPERVALU under which SUPERVALU will become the primary supplier of frozen foods
to the combined Jitney-Jungle and Delchamps group of companies and a secondary
supplier of selected grocery products to a number of stores within the group.
Management believes that the agreement reached with SUPERVALU should result in
lower distribution costs and a decrease of approximately 35% in inventory
levels. The agreement takes effect in January 1998.
The Company leases and maintains a fleet of 143 tractors and 332 trailers
with full-time, non-unionized drivers to handle distribution and ensure the
timely delivery of products to all of its supermarkets. The Company's trucks
also backhaul goods from suppliers to its warehouses, which reduces the
Company's overall cost of transportation.
SUPERMARKET OPERATIONS
Supermarket operations are the responsibility of three regional operating
executives who supervise the Company's 14 district managers. Each district
manager is responsible for nine to 15 supermarkets in his area. District
managers regularly visit the supermarkets under their jurisdiction, thereby
providing continuous, direct supervision of day-to-day supermarket operations,
including such matters as quality of merchandise, adequacy of staffing levels
and adherence to Company policies. Each supermarket is individually supervised
by a supermarket manager, assistant supermarket manager and department managers.
Management monitors the results of operations of each supermarket through the
close and direct supervision of the regional operating executives and the
district managers.
EMPLOYEES AND LABOR RELATIONS
As of May 3, 1997, Jitney-Jungle had 10,600 employees and Delchamps had
7,900 employees. Management believes that the Company enjoys good relations with
its employees.
Employees at the Hammond, Louisiana distribution facility recently voted to
establish a union; however, certification of the election results is currently
pending. With the possible exception of the employees at the Hammond
distribution facility, none of the Company's employees are subject to a
collective bargaining agreement.
In connection with the Delchamps Acquisition, Management expects to
consolidate the corporate headquarters of the combined operations in the
existing corporate headquarters of Jitney-Jungle. Although a divisional office
will be opened in Mobile, Alabama, the Delchamps Mobile headquarters will be
closed and approximately 160 positions currently held by employees at the
Jitney-Jungle and Delchamps corporate headquarters will be eliminated.
Management currently expects that the Delchamps headquarters will be closed
within three to six months after the Delchamps Acquisition. In addition, in
connection with the Delchamps Acquisition, Management expects to close the
Hammond, Louisiana warehouse owned by Delchamps and to close 13 supermarkets.
INFORMATION SERVICES
The Company's Information Services Department provides the software
applications, hardware systems and telecommunications technologies necessary to
support the Company's operations. The supermarket-based systems are fully
integrated via an in-store network and include the following: (i) point-of-sale
("POS") store front-end systems with integrated scanner/scale capability; (ii)
Unix-based, In-Store Processors ("ISP") which support business functions such as
direct store delivery, inventory management, video rental and pharmacy; (iii)
personal computers which support labor scheduling; (iv) an on-line procurement
system which supports the purchasing department with a sophisticated forecasting
algorithm that assists buying decisions and inventory control; (v) an advanced
forecasting module that forecasts product movement and recommends purchases to
replenish inventories; (vi) Electronic Data Interchange ("EDI") communication
which transmits purchase orders and receives invoices with about 70.0% of the
Company's high volume vendors; and (vii) a complete business recovery plan to
prevent a data center
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disaster, which includes mainframe applications, client-server applications and
network telecommunications.
In addition, the Company's procurement system is interfaced into an
extensive warehousing system that controls facets of merchandise receiving and
shipping to the supermarkets. The warehousing system utilizes radio
frequency-based technology to accomplish merchandise storage at a minimum cost
by reducing labor cost and improving warehouse flow. This system also utilizes a
complete transportation module for the loading of trailers based upon delivery
routes. Additionally, the system has been improved with the implementation of
hand-held scanners in the supermarkets for routine processing of supermarket
orders.
Advances in technology are important to the Company's ability to improve
productivity and keep costs in line, and emphasis will continue to be placed on
innovations in this area.
PROPERTIES
Management believes that the Company's retail supermarkets are well situated
in high-traffic locations. With the exception of one owned supermarket, all of
the Company's supermarket properties are leased pursuant to long-term contracts
at market rates. Certain parties affiliated with Jitney-Jungle hold 18 leases,
representing 21% of the dollar amount of the Company's capital leases.
Management believes that each of these leases is on an arm's length basis and is
on terms that are no less favorable to the Company than could have been obtained
with non-affiliated parties at the time each was entered into. See "Certain
Relationships and Related Transactions". Two other landlords each lease seven
supermarkets to Jitney-Jungle. No other landlords hold a significant number of
supermarket leases with the Company. With the exception of one lease, which will
expire in 2001, all leases for supermarkets operated under the names
"Jitney-Jungle", "Sack and Save" and "Jitney-Premier" will expire between 2005
and 2036 if the Company exercises all its options to renew. Five Delchamps
supermarket leases expired during the LTM Period, and no more than five
Delchamps leases will expire in any one year until the year 2005.
The Company has a real estate department the functions of which include (i)
negotiation and preparation of legal documents, (ii) the screening of
preliminary sites and the disposition of property, and (iii) the management of
properties. Management believes that a vital factor in a successful supermarket
expansion program is the careful selection of supermarket locations. Management
analyzes prospective locations on a continuous basis, both internally and with
assistance of outside consultants. The Company regularly enlarges, modernizes,
relocates or closes supermarkets in light of their past performance and
Management's assessment of their future potential.
Except for approximately $3.2 million of supermarket "POS" equipment which
is leased, the Company owns the furnishings and fixtures in all supermarkets and
has made various leasehold improvements to these supermarket sites. It is
anticipated that the Company will own the furnishings and fixtures in all
supermarkets presently under construction.
The Company owns all of its warehouse and distribution facilities except for
a 120,000 square foot dry grocery and health and beauty care facility. The lease
for that facility expires on July 31, 2004 (including all renewal options). The
table below sets forth the Company's warehouse and distribution capacity in its
Jackson and Hammond facilities:
<TABLE>
<CAPTION>
FUNCTION JACKSON HAMMOND
<S> <C> <C>
(SQUARE FEET IN THOUSANDS)
Dry Grocery and Health and Beauty Care.............................. 578 470
Perishables......................................................... 157 101
Frozen.............................................................. 79 63
--- ---
Total........................................................... 814 634
</TABLE>
Upon consummation of the Delchamps Acquisition, the Company will own the
65,000 square foot building which houses the corporate headquarters of Delchamps
in Mobile, Alabama (including a 2.7 acre
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parcel adjacent to such headquarters), the Hammond warehouse (including a 165
acre parcel adjacent to such warehouse) and interests in six additional parcels,
some of which are undeveloped. In connection with the Delchamps Acquisition,
Management expects to consolidate the corporate headquarters of the Company's
combined operations in the existing corporate headquarters of Jitney-Jungle.
Although a divisional office will be opened in Mobile, Alabama, the Delchamps
Mobile headquarters will be closed. Management also expects to close the Hammond
warehouse, and the Company may determine to sell, or develop for sale, certain
of such parcels of real estate.
In the first quarter of fiscal 1997, the Company sold the operating assets
of Jitney-Jungle's 24,000 square foot bakery for $750,000. The Company purchases
bakery products from the new owner of the bakery and additional bread products
from outside suppliers.
ENVIRONMENTAL MATTERS
The Company is subject to federal, state and local laws and regulations
including those relating to environmental protection, workplace safety, public
health and community right-to-know. The Company's supermarkets are not highly
regulated under environmental laws since the Company does not engage in any
industrial activities at these locations. The principal environmental
requirements applicable to Jitney-Jungle's operations relate to the ownership or
use of tanks for the storage of petroleum products, such as gasoline and diesel
fuel, the operation of on-site paper trash incinerators, and the operation of an
on-site printing facility. The Company operates 56 locations (including all 53
of the Pump And Save locations), and has retained responsibility for one former
facility, at which petroleum products are stored in underground tanks. The
Company has instituted an environmental compliance program designed to insure
that these tanks are in compliance with applicable technical, operational and
regulatory requirements, including periodic inventory reconciliation and
integrity testing. Jitney-Jungle also operates small incinerators at 21
locations which burn paper trash and has air permits for these facilities. In
addition, the Company's printing facility is subject to air and hazardous waste
regulations. In addition, the Company's locations may have asbestos-containing
materials which must be managed in accordance with environmental laws and
regulations. However, the Company does not believe that the cost of such
management will be material. The Company believes that the locations where it
currently operates are in substantial compliance with regulatory requirements.
The Company has undertaken programs to comply with upcoming regulatory
obligations. First, at five locations, the Company must comply with petroleum
tank upgrade or closure requirements under the Resource Conservation and
Recovery Act of 1980, as amended, ("RCRA") (including all applicable
requirements of state regulatory agencies) which must be met by 1998. Second,
over the next several years, the Company is planning to complete retrofitting of
its chloroflurocarbon ("CFC") chiller units to utilize non-CFC based
refrigerants pursuant to the phase-out of CFCs under the Clean Air Act. Future
events, such as changes in existing laws and regulations or their interpretation
and the approach of other compliance deadlines may or will give rise to
additional compliance costs or liabilities. Compliance with more stringent laws
or regulations, as well as different interpretations of existing laws, may
require additional expenditures by the Company which may be material.
The Company may also be subject to requirements related to the remediation
of, or the liability for remediation of, substances that have been released to
the environment at properties owned or operated by the Company or at properties
to which Jitney-Jungle sends substances for treatment or disposal. Such
remediation requirements may be imposed without regard to fault and liability
for environmental rernediation can be substantial. Other than one previously
owned property for which the Company retained responsibility for a clean-up in
progress at the time of the sale, the Company has not been notified of any such
releases relating to off-site treatment or disposal or to previously owned
properties. However, 16 of the Company's locations have been or currently are
the subject of environmental investigation or remediation, 12 as a consequence
of known or suspected petroluem-related leaks or spills from storage tanks and
four for minor spills or releases unrelated to tank usage. See "Risk
Factors--Environmental
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Risks." Four other properties have undergone investigation or remediation for
minor spills unrelated to tank usage.
The Company may be eligible for reimbursement or payment for remediation
costs associated with future releases from its regulated underground storage
tanks and has obtained such reimbursement in the past. The states in which the
Company operates each maintain a fund to assist in the payment of remediation
costs and injury or damage to third parties from releases from certain
registered underground tanks. Subject to certain deductibles, the availability
of funds, compliance status of the tanks and the nature of the release, these
funds have been and may be available to Jitney-Jungle for use in remediating
releases from its tank systems. Due to the availability of such funds, the
Company's unreimbursed cost for remediation at all of the facilities which have
had leaks or spills from underground storage tanks has not been material. All
significant required expenditures in connection with the clean up of such leaks
and spills have been made at such locations, except at three newly discovered
locations which are still undergoing investigation and one location awaiting
state approval of its remediation plan. Remediation expenses at all the
locations which are currently the subject of environmental investigation or
remediation are anticipated to cost up to $240,000 in fiscal 1998 and
approximately $125,000 per year thereafter, substantially all of which is
subject to reimbursement as described above. In addition, the Company has
obtained insurance coverage for bodily injury, property damage and corrective
action expenses resulting from releases of petroleum products from underground
storage tanks during the covered period at 53 of its 57 underground storage tank
locations, and an application for such coverage is pending at one of the four
remaining locations.
Other than expenditures relating to the remediation of tank leaks and spills
described above, the Company's expenditures to comply with environmental laws
and regulations have primarily consisted of those related to tank upgrading and
retrofitting CFC chiller units. The Company spent $515,000, $468,000 and
$914,000 for such activities during fiscal 1995, fiscal 1996 and the LTM Period,
respectively. Between approximately $472,000 and $1,055,000 in expenditures are
contemplated for retrofitting the CFC units and between approximately $455,000
and $755,000 in expenditures are contemplated for tank upgrading to comply with
the 1998 tank standards or closure in fiscal 1998 and fiscal 1999. These
regulatory compliance costs are not covered by insurance.
INTELLECTUAL PROPERTY
The Company uses a variety of trade names, service marks and trademarks.
Except for "Jitney-Jungle," "Jitney-Premier," "Delchamps," "Sack and Save" and
"Pump And Save," Management does not believe any of such trade names, service
marks or trademarks are material to its business.
GOVERNMENT REGULATION
The Company is subject to regulation by a variety of governmental agencies,
including but not limited to the United States Food and Drug Administration, the
United States Department of Agriculture and other federal, state and local
agencies.
LEGAL PROCEEDINGS
The Company is subject to periodic litigation in the ordinary course of its
business, including lawsuits brought by employees and former employees alleging
discriminatory termination and promotion practices. Delchamps recently settled a
claim of alleged race discrimination for approximately $4.3 million in which a
potential class of plaintiffs was denied certification of the class on
procedural grounds, and Delchamps is reviewing, revising and improving its
termination and promotion policies as part of the related settlement agreement.
There can be no assurance that future litigation alleging discrimination in the
Company's termination or promotion practices would not have an adverse effect on
the Company's financial condition or results of operation.
Other than with respect to the foregoing matters, the Company is not a party
to any to any material pending legal proceedings except ordinary litigation
incidental to the conduct of its business and the ownership of its properties.
67
<PAGE>
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS OF JITNEY-JUNGLE
The following table sets forth the directors and senior executive officers
of Jitney-Jungle. Directors of Jitney-Jungle hold their offices for a term of
one year or until their successors are elected and qualified; executive officers
of Jitney-Jungle serve at the discretion of the Board of Directors. For
information concerning certain arrangements with respect to the election of
directors, see "Certain Relationships and Related Transactions--Shareholders
Agreement."
<TABLE>
<CAPTION>
NAME AGE POSITION
<S> <C> <C>
W.H. Holman, Jr....................................... 67 Chairman
Michael E. Julian..................................... 46 Director, Chief Executive Officer and President
David K. Essary....................................... 47 Executive Vice President
David R. Black........................................ 44 Senior Vice President--Finance, Chief Financial
Officer
Harold D. Evans....................................... 52 Senior Vice President--Store Operations
J.R. Hansbrough....................................... 41 Senior Vice President--Information Services
Jerry L. Jones........................................ 45 Senior Vice President--Retail Operations
James P. Riley........................................ 47 Senior Vice President--Engineering
Clyde D. Staley....................................... 60 Senior Vice President--Real Estate
W.H. Holman, III...................................... 33 Secretary
Bernard E. Ebbers..................................... 55 Director
Roger P. Friou........................................ 62 Director
Ronald E. Johnson..................................... 47 Director
John M. Moriarty, Jr.................................. 40 Director
Bruce C. Bruckmann.................................... 43 Director
Harold O. Rosser II................................... 48 Director
Stephen C. Sherrill................................... 44 Director
</TABLE>
W.H. HOLMAN, JR., CHAIRMAN, has been Chairman of the Board of Jitney-Jungle
since 1967 and served as Chief Executive Officer from 1967 until January 1997.
Mr. Holman is a director of two private companies.
MICHAEL E. JULIAN, DIRECTOR, CHIEF EXECUTIVE OFFICER AND PRESIDENT, was
appointed as Chief Executive Officer in January 1997 and as President in May
1997. He has served as a director since April 1996. Prior to January 1997, he
was Chairman, President and Chief Executive Officer of Farm Fresh, Inc. Mr.
Julian is a director of Jackson Hewitt Inc. and one private company.
DAVID K. ESSARY, EXECUTIVE VICE PRESIDENT, has spent 21 of his 25 years in
the industry with Jitney-Jungle, and has been Executive Vice President since
March 1996. Other positions previously held by Mr. Essary within Jitney-Jungle
include Executive Vice President--Retail Operations, Senior Vice
President--Marketing, Vice President--Perishables and Vice President--Meat
Operations.
DAVID R. BLACK, SENIOR VICE PRESIDENT--FINANCE, CHIEF FINANCIAL OFFICER
since 1996, joined the Company in 1976. During his Jitney-Jungle career, Mr.
Black has held various other positions with the Company including Treasurer,
Controller and Assistant Controller.
HAROLD D. EVANS, SENIOR VICE PRESIDENT--STORE OPERATIONS since 1993, began
his retail food career when he joined the Company in 1970. He has also served as
Vice President--Store Operations.
J.R. HANSBROUGH, SENIOR VICE PRESIDENT--INFORMATION SERVICES, has held that
position since 1996. He previously served as Vice President--Information
Services from 1994. Prior to 1994, he was a Consulting and Marketing
Representative with IBM Corporation.
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<PAGE>
JERRY L. JONES, SENIOR VICE PRESIDENT--RETAIL OPERATIONS, has held that
position since March 1996. Prior to that time, he served as Senior Vice
President--Human Resources since 1991, having joined the Company in 1986 as
District Manager. Mr. Jones was employed with a large regional supermarket chain
from 1968 to 1986 and was a District Manager at the time he left the company.
JAMES P. RILEY, SENIOR VICE PRESIDENT--ENGINEERING since 1996, previously
served as Vice President-- Engineering from 1991. He served as Director of
Engineering Services from 1985 to 1991.
CLYDE D. STALEY, SENIOR VICE PRESIDENT--REAL ESTATE, has held that position
since 1996. He previously served as Vice President--Real Estate from 1985.
W.H. HOLMAN, III, SECRETARY, since 1996, is also President of Pump And Save,
the Company's petroleum subsidiary. He has 13 years of industry experience, and
previously served as Senior Vice President--Sales and Marketing. Mr. Holman is
the son of W.H. Holman, Jr.
BERNARD E. EBBERS, DIRECTOR, has been President, Chief Executive Officer and
a director of WorldCom, Inc. since 1983.
ROGER P. FRIOU, DIRECTOR, has 24 years of industry experience having
originally joined Jitney-Jungle in 1966. Between March 1996 and May 1997 he
served as President of Jitney-Jungle, and between 1991 and 1996 he served as
Vice Chairman, Chief Financial Officer and Secretary. Other positions previously
held by Mr. Friou at Jitney-Jungle include President, Executive Vice President
and Vice President--Finance and Controller. Mr. Friou is a director of The
Parkway Properties, Inc.
RONALD E. JOHNSON, DIRECTOR, has been President, Chief Executive Officer and
a director of Farm Fresh, Inc. since January 1997. Previously, he served as
Chairman, President and Chief Executive Officer of Kash n' Karry and as
Executive Vice President and Chief Operating Officer of Farm Fresh, Inc.
JOHN M. MORIARTY, JR., DIRECTOR, has been a Managing Director of Donaldson,
Lufkin & Jenrette Securities Corporation since 1989 and a Managing Director of
DLJ Merchant Banking, Inc. since 1996. Mr. Moriarty is a director of a private
company.
BRUCE C. BRUCKMANN, DIRECTOR, has been a principal of BRS since its
formation in 1995. Mr. Bruckmann was an officer and subsequently a Managing
Director of Citicorp Venture Capital from 1983 through 1994. Previously, Mr.
Bruckmann was an associate at the New York law firm of Patterson, Belknap, Webb
& Tyler. Mr. Bruckmann is a director of Mohawk Industries, Inc., AmeriSource
Distribution Corporation, Chromcraft Revington Corporation, Anvil Knitwear,
Inc., CORT Business Services Corporation and of several private companies.
HAROLD O. ROSSER II, DIRECTOR, has been a principal of BRS since its
formation in 1995. Mr. Rosser was an officer and subsequently a Managing
Director of Citicorp Venture Capital from 1987 through 1994. Previously, he
spent 12 years with Citicorp/Citibank in various management and corporate
finance positions. Mr. Rosser is a director of DavCo Restaurants, Inc. and of
several private companies.
STEPHEN C. SHERRILL, DIRECTOR, has been a principal of BRS since its
formation in 1995. Mr. Sherrill was an officer and subsequently a Managing
Director of Citicorp Venture Capital from 1983 through 1994. Previously, he was
an associate at the New York law firm of Paul, Weiss, Rifkind, Wharton &
Garrison. Mr. Sherrill is a director of Galey & Lord, Inc., Windy Hill Pet Food
Company, Inc. and of several private companies.
DIRECTOR COMPENSATION AND COMMITTEE INTERLOCKS
Each non-employee director of Jitney-Jungle is currently paid an annual
retainer of $12,000 plus fees of $1,000 for each board meeting attended and $500
for each committee meeting attended. Directors who are employees of the Company
do not receive additional compensation as directors. The Board of
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<PAGE>
Directors held four regular meetings during fiscal 1997 and all directors
attended at least 75% of the total meetings of the Board of Directors and the
committees of which they were members.
Jitney-Jungle has a Compensation Committee of the Board of Directors which
is responsible for reviewing annual salaries and bonuses paid to senior
management and administering Jitney-Jungle's stock option programs. The members
of the Compensation Committee are Harold O. Rosser II, Chairman, Michael E.
Julian, Roger P. Friou and Bernard E. Ebbers. Robert R. Onstead was also a
member of the Compensation Committee but resigned from the Board in March 1997.
The Compensation Committee held one meeting during fiscal 1997.
Jitney-Jungle has an Audit Committee which reviews external and internal
auditing matters and recommends the selection of Jitney-Jungle's independent
auditors for approval by the Board of Directors. The members of the Audit
Committee are Steven C. Sherrill, Chairman, John M. Moriarty, Jr., and Ronald E.
Johnson. The Audit Committee held one meeting during fiscal 1997.
In fiscal 1997, Messrs. Julian, Ebbers and Johnson each received fees of
$16,000 for serving on the Board of Directors.
EXECUTIVE COMPENSATION
The following table summarizes the compensation paid or accrued for fiscal
1997, 1996 and 1995 to the Chief Executive Officer of Jitney-Jungle and to each
of the four other most highly compensated executive officers of Jitney-Jungle
(each such person being referred to as a "Named Executive Officer").
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
<S> <C> <C> <C> <C> <C> <C>
ANNUAL COMPENSATION
NAME AND OTHER ANNUAL LTIP ALL OTHER
PRINCIPAL POSITION YEAR SALARY(1) BONUS COMPENSATION(2) PAYOUTS(3) COMPENSATION
W.H. Holman, Jr.,............. 1997 $ 331,182 $ 162,920 $ 2,633 $ -- $ 15,795(5)
Chairman(4) 1996 315,100 121,193 2,216 1,894,039 15,840
1995 315,100 121,193 2,100 439,147 10,094
Michael E. Julian,............ 1997 57,692 75,000 -- -- --
Chief Executive Officer(4) 1996 -- -- -- -- --
1995 -- -- -- -- --
Roger P. Friou,............... 1997 223,637 96,537 2,356 -- 106,736(6)
President(4) 1996 182,600 68,461 1,807 2,247,911 106,578
1995 172,800 65,230 1,800 444,040 6,594
David K. Essary,.............. 1997 192,463 89,653 2,251 -- 103,485(7)
Executive Vice 1996 176,700 67,307 1,745 110,229 103,425
President 1995 145,800 53,422 1,700 -- 3,294
Jerry L. Jones,............... 1997 133,000 33,250 1,790 -- 3,149(8)
Senior Vice 1996 125,200 23,654 1,727 -- 3,141
President--Retail 1995 115,000 22,116 1,700 -- 2,907
Operations
Harold D. Evans,.............. 1997 121,500 30,376 1,978 -- 3,444(9)
Senior Vice 1996 114,000 21,923 1,863 -- 3,394
President--Store 1995 108,100 20,693 1,900 -- 3,330
Operations
</TABLE>
70
<PAGE>
- ------------------------
(1) The amounts shown in this column include amounts contributed as salary
deferral contributions in fiscal 1997, 1996 and 1995, respectively, under
the Jitney-Jungle Stores of America, Inc. and Affiliates Profit Sharing Plan
and Trust (the "401(k) Plan"), as follows: $8,236, $9,407 and $9,405 for Mr.
Holman; $0, $0 and $0 for Mr. Julian; $9,043, $9,288 and $9,287 for Mr.
Friou; $8,490, $9,500 and $8,715 for Mr. Essary; $7,507, $7,340 and $6,825
for Mr. Jones; and $6,835, $6,772 and $6,388 for Mr. Evans.
(2) Other annual compensation includes the annual estimated value of an
automobile furnished by the Company.
(3) Includes distributions from the Phantom Stock Plan.
(4) W.H. Holman, Jr. served as the Chief Executive Officer of the Company until
January 1997. Michael E. Julian became the Chief Executive Officer of the
Company in January 1997, and his salary reflects approximately 2/12ths of
his annual compensation. In May 1997, Mr. Friou resigned as President of the
Company, and Mr. Julian was appointed to serve in that position.
(5) Includes for fiscal 1997 $3,000 of Company matching contributions under the
401(k) Plan, $150 of Company profit sharing contributions under the 401(k)
Plan, and approximately $12,645 of premiums for group term life insurance.
(6) Includes for fiscal 1997 $3,000 of Company matching contributions under the
401(k) Plan, $150 of Company profit sharing contributions under the 401(k)
Plan, approximately $3,586 of premiums for group term life insurance, and
$100,000 as the second of three annual installments per an employment
agreement with Mr. Friou; subsequent to fiscal 1997, Mr. Friou retired and
forfeited the third payment.
(7) Includes for fiscal 1997 $3,000 of Company matching contributions under the
401(k) Plan, $150 of Company profit sharing contributions under the 401(k)
Plan, approximately $335 of premiums for group term life insurance, and
$100,000 as the second of three annual installments per an employment
agreement with Mr. Essary.
(8) Includes for fiscal 1997 $3,000 of Company matching contributions under the
401(k) Plan and $149 of Company profit sharing contributions under the
401(k) Plan.
(9) Includes for fiscal 1997 $2,746 of Company matching contributions under the
401(k) Plan, $135 of Company profit sharing contributions under the 401(k)
Plan, and approximately $563 of premiums for group term life insurance.
EMPLOYMENT AGREEMENTS
W.H. Holman, Jr. has an employment contract with Jitney-Jungle covering the
period through February 28, 2001. The agreement provides that Mr. Holman, Jr.
will serve as Chairman of the Board at the discretion of the Board of Directors.
If Mr. Holman, Jr. ceases to be Chairman of the Board prior to March 1, 2001, he
will continue to serve on the Board of Directors as Chairman Emeritus until
March 1, 2001, with a salary equal to his base salary then in effect until
February 28, 1999, and 50% of such base salary thereafter. Mr. Holman, Jr. is
also eligible for a bonus through February 28, 1999.
David K. Essary has an employment contract with Jitney-Jungle providing for
a base salary of approximately $186,000 per year for the period from March 1,
1995 through February 28, 1998. Mr. Essary is eligible to receive a bonus of up
to 50% of his base salary less $11,000. A provision in the employment contract
states that upon a change of control of Jitney-Jungle, Mr. Essary will be
awarded a payment of up to $300,000 to be paid in three annual installments of
$100,000. Because the Recapitalization constituted a change of control under
such employment agreement, Mr. Essary became entitled to receive such payment;
the first two $100,000 installments thereof were paid in March 1996 and March
1997, respectively. Provided he is still employed by Jitney-Jungle when the
final installment is due or his employment has been terminated by Jitney-Jungle
without cause or terminated by the employee for good reason, Jitney-Jungle will
pay Mr. Essary the last annual installment in 1998. No further payments are
required under the employment agreement upon any subsequent change of control.
In addition, Mr. Essary is entitled to his base salary plus anticipated bonus
for the remainder of the term of the agreement if his employment with
Jitney-Jungle is terminated by Jitney-Jungle without cause, he resigns his
employment at Jitney-Jungle's request without cause, or he terminates his
employment for good reason.
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<PAGE>
W.H. Holman, III has an employment contract with Jitney-Jungle covering the
period through February 28, 1998 and will serve at the discretion of the Board
of Directors as Secretary of Jitney-Jungle and as President of Pump And Save.
Mr. Holman, III will receive a base salary of no less than $110,000 per year
through February 28, 1998 subject to periodic increases as determined by the
Board of Directors. Mr. Holman, III is also entitled to a bonus of up to 50% of
his base salary less $11,000.
Until his retirement in May 1997, Roger P. Friou had an employment contract
with Jitney-Jungle. The terms of such employment contract were substantially
identical to those of Mr. Essary's contract, except that Mr. Friou was entitled
to receive a base salary of approximately $201,000 per year and a bonus of up to
50% of his base salary less $23,000. Mr. Friou's employment contract terminated
upon his retirement.
PHANTOM STOCK PLAN
On April 17, 1991 the Board of Directors of Jitney-Jungle adopted, and the
shareholders approved, the Amended and Restated Consolidated Phantom Stock Plan
of Jitney-Jungle (the "Phantom Stock Plan"). The Phantom Stock Plan provided
that phantom stock units could be awarded if combined net earnings exceed 15% of
stockholders' equity (as defined in the plan) at the beginning of the applicable
fiscal year; if earnings exceeded 15% of this base amount, awards could be made
equal to 10% of that excess to each participant. W.H. Holman, Jr., Roger P.
Friou and David K. Essary are the only three participants who currently have
units credited to them under this plan. Effective with the Recapitalization, the
Phantom Stock Plan was amended, restated and renamed "the Deferred Compensation
Plan for Jitney-Jungle Stores of America, Inc." Under this amended plan, no
further awards may be made and no other individuals may become participants. The
units credited to each of the three participants effectively have been divided
into two component amounts: a cash amount that will be payable in accordance
with the terms of the Phantom Stock Plan as in effect before its amendment, and
an amount that will continue to be credited under the terms of the plan to an
account, the value of which will be equal to the value of the number of shares
of Class C Preferred Stock of Jitney-Jungle that could be acquired with that
amount.
The accrued amounts payable in accordance with the pre-amendment provisions
of the Phantom Stock Plan became fully vested and payable in a single lump sum
effective with the Recapitalization on March 5, 1996. The amounts paid to
Messrs. Holman, Jr., Friou and Essary on March 7, 1996 were approximately
$1,894,000, $2,248,000 and $110,000, respectively, and Messrs. Holman, Jr.,
Friou and Essary applied an additional $474,000, $125,000 and $112,500,
respectively, toward the purchase price for shares of Class C Preferred Stock of
Jitney-Jungle in connection with the Recapitalization.
The Phantom Stock Plan is an unfunded deferred compensation arrangement with
an associated rabbi trust. The rabbi trust provides that the initial
contributions to the trust will be invested in shares of Class C Preferred
Stock. The initial contributions to the rabbi trust should equal the amounts
that will continue to be credited under the plan described above.
With respect to the amounts that continue to be credited under the plan as
amended, an amount equal to the amount of any cash dividends that would have
been paid on the number of shares of preferred stock credited to each
participant's account will be paid to the participant at the same time as any
cash dividends actually are paid on the preferred stock. Payment otherwise will
be made under the amended plan at the same time as the preferred stock is
redeemed, in an amount equal to the redemption price times the number (or
proportionate number, in the event of a partial redemption) of shares of
preferred stock credited to the participant's account.
401(K) PLAN
Jitney-Jungle maintains a Profit Sharing Plan and Trust (the "401(k) Plan")
for the benefit of its employees who have satisfied the plan's eligibility
requirements. Participants are permitted to make pre-tax salary reduction
contributions, up to the amount permitted under applicable tax law.
Jitney-Jungle makes a matching contribution equal to 50% of each participant's
salary reduction contribution, up to a maximum
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<PAGE>
of 2% of the participant's compensation. In addition, Jitney-Jungle may make
additional profit sharing contributions in its discretion. Although in prior
years Jitney-Jungle has made discretionary profit sharing contributions, it has
no obligation or present intention to do so in the future. Jitney-Jungle's
contributions become vested when the participant has been credited with five
years of service. Shares of Common Stock of Jitney-Jungle held under the 401(k)
Plan were surrendered in connection with the Recapitalization and exchanged for
cash and Class B Preferred Stock in accordance with the Recapitalization
documentation.
DELCHAMPS PLANS
Delchamps currently provides welfare and retirement benefits to its eligible
employees under various plans and arrangements, including an employee stock
option plan and a 401(k) plan. Following the Delchamps Acquisition, Management
intends to terminate the employee stock option plan and the 401(k) plan and
provide ongoing welfare and retirement benefits to such employees under the
existing plans of Jitney-Jungle.
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<PAGE>
OWNERSHIP OF CAPITAL STOCK
PRINCIPAL SHAREHOLDERS
The authorized capital stock of Jitney-Jungle consists of 5,000,000 shares
of common stock, par value $0.01 per share (the "Common Stock"), and 600,000
shares of preferred stock, par value $0.01 per share (the "Preferred Stock").
The Preferred Stock is issuable in one or more classes.
The following table sets forth certain information with respect to (i) the
beneficial ownership of Common Stock of Jitney-Jungle by each person or entity
who owns five percent or more thereof and (ii) the beneficial ownership of each
class of equity securities of Jitney-Jungle by each director of Jitney-Jungle
who is a shareholder, the Chief Executive Officer of Jitney-Jungle and the other
executive officers named in the "Summary Compensation Table" above who are
shareholders and all directors and officers of Jitney-Jungle as a group. Unless
otherwise specified, all shares are directly held.
<TABLE>
<CAPTION>
NUMBER AND PERCENT OF SHARES
<S> <C> <C> <C>
CLASS B CLASS C
PREFERRED PREFERRED
NAME OF BENEFICIAL OWNER COMMON STOCK STOCK STOCK
Bruckmann, Rosser, Sherrill &
Co., L.P.(1)........................................ 331,732/78.05% -- 70,808/70.81%
Two Greenwich Plaza
Suite 100
Greenwich, CT 06830
DLJ Merchant Banking Partners,
L.P. and related investors.......................... 75,000/15.00 (2) -- 15,000/15.00%
277 Park Avenue
New York, NY 10172
W.H. Holman, Jr....................................... 29,699/6.99 (3) 21,516/7.84%(4) 4,742/4.72%
Jitney-Jungle Stores of
America, Inc.
P.O. Box 3409
Jackson, MS 39207
Michael E. Julian..................................... 2,500* -- 534*
Roger E. Friou........................................ 12,510/2.94% 14(4) 1,252/1.25%
David K. Essary....................................... 11,250/2.65% -- 1,125/1.13%
Jerry L. Jones........................................ 1,200* -- 120*
Harold D. Evans....................................... 850* -- 85*
Bruce C. Bruckmann(5)................................. 353,750/83.24% -- 75,508/75.51%
Harold O. Rosser II(5)................................ 353,750/83.24% -- 75,508/75.51%
Stephen C. Sherrill(5)................................ 353,750/83.24% -- 75,508/75.51%
Stephen F. Edwards(5)................................. 332,663/78.27% -- 71,007/71.01%
All directors and officers as a group
(18 persons)........................................ 421,359/99.14% 26,729/9.74%(4) 92,207/92.21%
</TABLE>
- ------------------------
* Less than one percent of total outstanding Common Stock, Class B Preferred
Stock and Class C Preferred Stock.
(1) The Fund is a limited partnership, the sole general partner of which is BRS
Partners, Limited Partnership ("BRS Partners") and the manager of which is
BRS. The sole general partner of BRS Partners is BRSE Associates, Inc.
("BRSE Associates"). Bruce C. Bruckmann, Harold O. Rosser II, Stephen C.
Sherrill and Stephen F. Edwards are the only stockholders of BRS and BRSE
Associates and may be deemed to share beneficial ownership of the shares
shown as beneficially owned by the Fund. Such individuals disclaim
beneficial ownership of any such shares.
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<PAGE>
(2) Represents warrants to acquire 15%, on a fully diluted basis, of the Common
Stock.
(3) Includes 19,699 shares held by Performance Partnership, L.P. W.H. Holman,
Jr. is the general partner of such partnership and possesses voting power
with respect to such shares.
(4) All outstanding shares of Class B Preferred Stock are held by Trustmark
National Bank ("Trustmark") pursuant to an escrow agreement by and among
Trustmark, Jitney-Jungle and the persons who were shareholders of
Jitney-Jungle prior to the Recapitalization. Messrs. Holman, Jr. and Friou
own an interest in the escrow account through which they have a beneficial
interest in the shares of Class B Preferred Stock listed in this table.
(5) Includes shares of Common Stock and Class C Preferred Stock which are owned
by the Fund and certain other entities and individuals affiliated with BRS.
Although Messrs. Bruckmann, Rosser, Sherrill and Edwards may be deemed to
share beneficial ownership of such shares, such individuals disclaim
beneficial ownership thereof. See Note 1 above.
CLASS A PREFERRED STOCK
An aggregate of $22.5 million in liquidation preference of the Class A
Preferred Stock is outstanding. The Class A Preferred Stock ranks senior in
right of payment of cash dividends, liquidation preference and redemption (both
mandatory and optional as described below) to the Class B Preferred Stock and
the Class C Preferred Stock.
Dividends on the Class A Preferred Stock are payable quarterly at an annual
rate of 15%. Dividends for the first five years following the Recapitalization
are payable, at Jitney-Jungle's option, either by cumulation to liquidation
preference or in cash and, thereafter, dividends will be payable in cash. The
Senior Credit Facility, the Senior Note Indenture and the Indenture will
restrict Jitney-Jungle's ability to pay cash dividends on the Class A Preferred
Stock.
The Class A Preferred Stock is redeemable at Jitney-Jungle's option, (i) at
any time after March 1, 2001 at a price per share equal to the then applicable
liquidation preference plus accrued and unpaid dividends and a prepayment
premium or (ii) on or prior to March 1, 1999 with the proceeds of a public
offering of Common Stock at a price per share equal to 114% of the then
applicable liquidation preference plus accrued and unpaid dividends thereon. All
of the Class A Preferred Stock is required to be redeemed on or before the
twelfth anniversary of issuance at a price per share equal to the then
applicable liquidation preference plus accrued and unpaid dividends.
Jitney-Jungle is required to offer to repurchase (to the extent permitted by the
terms of the Senior Credit Facility) all shares of Class A Preferred Stock upon
a Change of Control (as defined in the certificate of designations with respect
to the Class A Preferred Stock) at a price per share equal to 101% of the then
applicable liquidation preference, plus accrued and unpaid dividends thereon.
The Senior Credit Facility will restrict Jitney-Jungle's ability to redeem or
repurchase the Class A Preferred Stock.
The Class A Preferred Stock does not have any voting rights, except (i) as
required by law and (ii) with respect to the issuance of pari passu and senior
securities, certain mergers and certain amendments to the Articles of
Incorporation of Jitney-Jungle or the Exchange Debenture Indenture.
Additionally, in the event of certain defaults, including the failure to pay
dividends when required, then the number of directors constituting the Board of
Directors will be increased by two, and the holders of Class A Preferred Stock
will be entitled to elect two directors to the Board of Directors. The Class A
Preferred Stock is exchangeable (with cumulated dividends) at Jitney-Jungle's
option, in whole but not in part, for subordinated exchange debentures (the
"Exchange Debentures") of Jitney-Jungle. The Exchange Debentures will pay
interest from the date of exchange at the rate of 15% per annum, consisting of,
at Jitney-Jungle's option, additional Exchange Debentures or cash on or prior to
March 1, 2001 and cash thereafter. The Exchange Debentures will mature on March
1, 2008. The Senior Credit Facility, the Senior Note Indenture
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<PAGE>
and the Indenture will restrict Jitney-Jungle's ability to exchange the Class A
Preferred Stock for Exchange Debentures and Jitney-Jungle's ability to redeem or
repurchase the Exchange Debentures.
CLASS B PREFERRED STOCK
An aggregate of $27.5 million in liquidation preference of the Class B
Preferred Stock is outstanding. The Class B Preferred Stock ranks junior in
right of payment of cash dividends, liquidation preference and redemption (both
mandatory and optional as described below) to the Class A Preferred Stock and
senior in right of payment of cash dividends, liquidation preference and
redemption (both mandatory and optional as described below) to the Class C
Preferred Stock.
Dividends on the Class B Preferred Stock are payable annually when and as
declared by the Board of Directors of Jitney-Jungle at a rate of 10.0% per
annum. Dividends cumulate on a compounding basis until paid. The Senior Credit
Facility, the Senior Note Indenture, the Indenture and the Class A Preferred
Stock restrict Jitney-Jungle's ability to pay cash dividends on the Class B
Preferred Stock.
The Class B Preferred Stock is redeemable at Jitney-Jungle's option at any
time, in whole or in part, at a price per share equal to the then applicable
liquidation preference plus accrued and unpaid dividends. All of the Class B
Preferred Stock is required to be redeemed on the fourteenth anniversary of
issuance at a price per share equal to the then applicable liquidation
preference plus accrued and unpaid dividends. Jitney-Jungle will also be
required to offer to repurchase (to the extent permitted by the terms of the
Class A Preferred Stock and any indebtedness to which Jitney-Jungle is a party)
all shares upon a Change in Control (as defined in the certificate of
designations with respect to the Class B Preferred Stock) at a price in cash
equal to 100.0% of the liquidation preference thereof plus accrued and unpaid
dividends.
Jitney-Jungle is required to offer to repurchase (to the extent permitted by
the terms of the Class A Preferred Stock and any indebtedness to which
Jitney-Jungle is a party) all shares of Class B Preferred Stock upon the sale by
the Fund (or its affiliates) of more than 10.0% of the outstanding shares of the
Common Stock of Jitney-Jungle, except that the Fund (or its affiliates) may (i)
sell up to 5.0% of the outstanding shares to original shareholders, officers,
directors, consultants or employees of Jitney-Jungle; (ii) sell outstanding
shares to certain affiliates and principals of the Fund and persons related
thereto; or (iii) exchange Common Stock or Class C Preferred Stock for
securities which rank junior to the Class B Preferred Stock. Jitney-Jungle is
also required to offer to repurchase (to the extent permitted by the terms of
the Class A Preferred Stock and any indebtedness to which Jitney-Jungle is a
party) all shares of Class B Preferred Stock if Jitney-Jungle changes its state
of incorporation.
In addition, Jitney-Jungle is required to offer to apply (to the extent
permitted by the terms of the Class A Preferred Stock and any indebtedness to
which Jitney-Jungle is a party) Net Proceeds (as defined) raised through any
primary issuance of securities junior to Class B Preferred Stock to repurchase
shares of Class B Preferred Stock. "Net Proceeds" means the net cash proceeds
received by Jitney-Jungle from the issuance of such junior securities after
payment of expenses of issuance of such securities and application of such funds
to repay or redeem senior securities (to the extent required) and the repayment
of indebtedness (to the extent required).
The Senior Credit Facility, the Senior Note Indenture, the Indenture and the
Class A Preferred Stock restrict Jitney-Jungle's ability to redeem or repurchase
shares of the Class B Preferred Stock.
The Class B Preferred Stock does not have any voting rights except as
required by Mississippi law, as in effect on the date of issuance.
CLASS C PREFERRED STOCK
An aggregate of $10.0 million in liquidation preference of the Class C
Preferred Stock, Series 1 and Series 2, is outstanding. The Series 1 is not
redeemable by Jitney-Jungle at any time; the Series 2 is redeemable, as
described below. The Class C Preferred Stock ranks junior in right of payment of
cash
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dividends, liquidation preference and redemption (both mandatory and optional as
described below) to the Class A Preferred Stock and the Class B Preferred Stock.
Dividends on the Class C Preferred Stock are payable annually when and as
declared by the Board of Directors of Jitney-Jungle at a rate of up to 10.0% per
annum. Dividends cumulate on a compounding basis until paid. The Senior Credit
Facility, the Senior Note Indenture, the Indenture, the Class A Preferred Stock
and the Class B Preferred Stock restrict Jitney-Jungle's ability to pay cash
dividends on the Class C Preferred Stock.
The Class C Preferred Stock, Series 2, is redeemable at Jitney-Jungle's
option at any time, in whole or in part, at a price per share equal to the
liquidation preference plus accrued and unpaid dividends (including cumulated
dividends). The Class C Preferred Stock, Series 2, is required to be redeemed on
the fifteenth anniversary of issuance at a price per share equal to the
liquidation preference plus accrued and unpaid dividends (including cumulated
dividends). Jitney-Jungle is required to offer to repurchase (to the extent
permitted by the terms of the Class A Preferred Stock, the Class B Preferred
Stock and any indebtedness to which Jitney-Jungle is a party) all shares of
Series C Preferred Stock, Series 1 and Series 2, upon a Change of Control (as
defined in the certificate of designations with respect to the Class C Preferred
Stock) at a price in cash equal to 100% of the then applicable liquidation
preference, plus accrued and unpaid dividends thereon. The Senior Credit
Facility, the Senior Note Indenture, the Indenture, the Class A Preferred Stock,
the Exchange Debentures and the Class B Preferred Stock restrict Jitney-Jungle's
ability to redeem or repurchase the Class C Preferred Stock.
The Class C Preferred Stock does not have any voting rights, except as
required by law.
COMMON STOCK
The holders of Common Stock are entitled to one vote for each share held of
record and all matters submitted to a vote of shareholders. The holders of
Common Stock have no preemptive rights, rights to maintain their respective
percentage ownership interests in Jitney-Jungle or other rights to subscribe for
additional shares of Jitney-Jungle other than as set forth in the Shareholders
Agreement.
WARRANTS
In connection with the Recapitalization, warrants to purchase 75,000 shares
of Common Stock (the "Warrants"), representing 15.0% of the Common Stock of
Jitney-Jungle (on a fully diluted basis) outstanding immediately following the
Recapitalization, were issued to DLJ Merchant Banking Partners, L.P. and related
investors. The Warrants have an exercise price of $0.01 per share and expire 12
years after issuance.
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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
LEASING AGENT AGREEMENT
Pursuant to an agreement with Jitney-Jungle, McCarty-Holman Co., L.P. (the
"Partnership") is the exclusive agent for Jitney-Jungle to rent, lease, operate
and manage all locations where Jitney-Jungle has sublet space to various tenants
and where it has space vacant and available for subleasing. W.H. Holman, Jr.
owns a noncontrolling interest in the Partnership. Under the agreement, the
Partnership is entitled to fees as follows: (i) for management, 4% of all
rental/lease collections; (ii) for leasing, 6% of the annual rent (for a
month-to-month tenancy, one-half of the first month's rent); and (iii) for
services other than those delineated above, fees are negotiated. In fiscal 1997,
the Partnership received approximately $41,000 in fees pursuant to this
agreement. Management believes that the agreement is on an arm's length basis
and is on terms that are no less favorable to Jitney-Jungle than could have been
obtained with non-affiliated parties at the time the agreement was entered into.
LEASES OF CERTAIN SUPERMARKETS AND FACILITIES
W.H. Holman, Jr., W.H. Holman, III and Roger P. Friou own in the aggregate
noncontrolling interests in certain partnerships that are landlords under 18
leases for supermarkets or other facilities where Jitney-Jungle and its
affiliates are the tenants. In fiscal 1997 and 1996, Jitney-Jungle paid a
combined total rent under these 18 leases of approximately $3.6 million and $3.6
million, respectively. Management believes that each of these leases is on an
arm's length basis and is on terms that are no less favorable to Jitney-Jungle
than could have been obtained with non-affiliated parties at the time each lease
was entered into.
MANAGEMENT LOANS
David K. Essary, Executive Vice President of Jitney-Jungle has an
outstanding loan for the purchase of Common Stock from Jitney-Jungle in an
amount of $79,906 as of May 3, 1997. The loan is evidenced by an unsecured note
which bears interest at the rate of 8.25% per annum and is payable in three
annual installments, the first of which was paid in March 1997. Eight other
executive officers of Jitney-Jungle have borrowed an aggregate of $69,824 for
the purchase of Common Stock and Class C Preferred Stock from Jitney-Jungle.
SHAREHOLDERS AGREEMENT
Certain shareholders of Jitney-Jungle, including the Fund Entities, the DLJ
Entities and Messrs. Holman, Jr., Holman III and Friou (the "Management
Shareholders") are parties to a Shareholders Agreement which contains certain
agreements among such shareholders with respect to the capital stock and
corporate governance of Jitney-Jungle. The following is a summary of the
material terms of the Shareholders Agreement.
Pursuant to the Shareholders Agreement, the maximum number of members of the
Board of Directors of Jitney-Jungle is 12 (plus any additional directors who may
be elected in accordance with the terms of Jitney-Jungle's preferred stock). The
DLJ Entities and the Management Shareholders each have the right to appoint one
member to the Board of Directors. In addition, the approval of the director
appointed by the DLJ Entities is required in order for Jitney-Jungle to enter
into certain transactions. The DLJ Entities' rights to appoint a director and to
approve of such transactions will terminate upon certain reductions in the DLJ
Entities' ownership of the Warrants or upon a person or persons (other than the
Fund Entities, DLJ Entities or Management Shareholders) acquiring a majority of
the then outstanding Common Stock.
The Shareholders Agreement contains certain provisions which with certain
exceptions (i) restrict the ability of the Fund Entities, the DLJ Entities and
the Management Shareholders from transferring any shares of Common Stock or
Warrants until the earlier to occur of the initial public offering of Common
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Stock of Jitney-Jungle and the second anniversary of the consummation of the
Recapitalization, (ii) restrict the ability of the Fund Entities from
transferring any shares of Class C Preferred Stock until the earlier to occur of
the initial public offering of Common Stock of Jitney-Jungle and the fourth
anniversary of the consummation of the Recapitalization and (iii) restrict the
ability of the DLJ Entities and the Management Shareholders from transferring
any shares of Class C Preferred Stock until the earlier to occur of the initial
public offering of Common Stock of Jitney-Jungle and the second anniversary of
the consummation of the Recapitalization. The foregoing will not restrict the
ability of the DLJ Entities to transfer shares of Common Stock, Class C
Preferred Stock or Warrants in connection with a transfer of Class A Preferred
Stock or of any shareholder to transfer securities in connection with any public
offering of Common Stock of Jitney-Jungle pursuant to certain registration
rights set forth in the Shareholders Agreement. Prior to sales of Common Stock
by the Fund Entities, the DLJ Entities have the right to negotiate with such
Fund Entity for the purchase of any and all shares that Fund Entity desires to
sell. With respect to proposed dispositions by the Fund Entities of their
securities, the DLJ Entities have the right to require the proposed transferee
to purchase, on the same terms and conditions as given to the Fund Entities, a
pro rata portion of like securities (or Warrants therefor) held by the DLJ
Entities. Subject to certain exceptions, if Jitney-Jungle proposes to issue
Common Stock or rights to purchase Common Stock, the Fund Entities and the DLJ
Entities have the right, on the same terms and conditions of the proposed
issuance, to purchase pro rata portions of the securities to be issued.
Jitney-Jungle has granted the Fund Entities three separate demand registration
rights with respect to their securities. Jitney-Jungle has granted the DLJ
Entities (i) three demand registration rights with respect to their shares of
Common Stock, Class C Preferred Stock and Warrants, in the aggregate, which
demand rights are not exercisable prior to the earlier to occur of the initial
public offering of Common Stock of Jitney-Jungle and the fifth anniversary of
the consummation of the Recapitalization and (ii) three demand registration
rights with respect to their shares of Class A Preferred Stock. All of the
shareholders party to the Shareholders Agreement have the right to participate,
or "piggyback," in certain registrations initiated by Jitney-Jungle or pursuant
to a demand.
DEALER-MANAGER; SOLICITATION AGENT; UNDERWRITER
Donaldson, Lufkin & Jenrette Securities Corporation, one of the Initial
Purchasers and an affiliate of DLJ Merchant Banking Partners, L.P., acted as
Dealer-Manager in connection with the Delchamps Tender Offer and as Solicitation
Agent in connection with the Consent Solicitation, and it received customary
fees and reimbursement of expenses in connection with the services rendered by
it in the latter capacity. Donaldson, Lufkin & Jenrette Securities Corporation
also acted as underwriter in connection with the offering of the Senior Notes by
the Company, for which it received customary fees and reimbursement of expenses.
BRS MANAGEMENT AGREEMENT; CLOSING FEE
Pursuant to a management agreement between Jitney-Jungle and BRS, BRS is
entitled to receive an annual management fee from Jitney-Jungle for the
performance of strategic and financial planning services. The amount of the fee
ranged from $250,000 to $1.0 million per year and is based on certain
performance criterion. In connection with the Consent Solicitation,
Jitney-Jungle solicited and obtained consents to an amendment to the Senior Note
Indenture to permit the amendment of the management agreement to eliminate the
performance criteria set forth therein and permit the payment of fees to BRS
after the end of each fiscal quarter of the greater of (i) $250,000 or (ii) 1.0%
of the Company's EBITDA for such quarter (provided that the total amount of all
such payments in any fiscal year may not exceed the greater of (x) $1.0 million
or (y) one percent of EBITDA for such fiscal year). The amendment of the
management agreement occurred simultaneously with the consummation of the
Transactions. In addition, upon consummation of the Transactions the Company
paid BRS a closing fee of $4.0 million.
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DESCRIPTION OF CERTAIN INDEBTEDNESS
The following is a summary of certain indebtedness of the Company which will
remain outstanding following consummation of the Delchamps Merger. See
"Summary--Use of Proceeds." To the extent such summary contains descriptions of
the Senior Credit Facility, the Senior Note Indenture and other loan documents,
such descriptions do not purport to be complete and are qualified in their
entirety by reference to such documents, which are available upon request from
the Company.
SENIOR CREDIT FACILITY
In connection with the Delchamps Acquisition, Jitney-Jungle's existing
revolving credit facility with Fleet Capital Corporation (as successor agent to
Fleet Bank, N.A.) and certain other lenders (collectively, the "Lender") was
amended and restated to provide for a $150.0 million Senior Credit Facility.
Borrowings by the Company and its subsidiaries (including Delchamps following
the consummation of the Delchamps Tender Offer) of $72.7 million under the
Senior Credit Facility were or will be used to finance a portion of the
Delchamps Purchase Price, to repay certain indebtedness of Delchamps and to pay
fees and expenses incurred in connection with the Transactions and the Delchamps
Merger. The Senior Credit Facility will also be available to provide for the
ongoing working capital requirements of the Company and its subsidiaries.
The commitments under the Senior Credit Facility will terminate, and all
loans outstanding thereunder will be required to be repaid in full, six and
one-half years following the consummation of the Delchamps Tender Offer (the
"Closing Date"). Borrowings under the Senior Credit Facility, including
revolving loans and up to $30.0 million in letters of credit, will not exceed
the lesser of (i) the "Total Commitment," which initially will be $150.0 million
and (ii) an amount equal to the sum of (A) up to 65% of eligible inventory
(valued at the lesser of FIFO cost or current market value) of the Company and
its subsidiaries and (B) the "Supplemental Availability," which initially will
be $53.0 million. The maximum amount available for borrowing under the Senior
Credit Facility and the Supplemental Availability will be reduced in quarterly
installments during each year in the aggregate annual amounts set forth below:
<TABLE>
<CAPTION>
SENIOR CREDIT
FACILITY
YEAR FOLLOWING CLOSING DATE REDUCTION
<S> <C>
1....................................................................................... $ 0
2....................................................................................... $ 5,000,000
3....................................................................................... $ 7,000,000
4....................................................................................... $ 8,000,000
5....................................................................................... $ 9,000,000
6....................................................................................... $ 11,000,000
First quarter year 7............................................................................ $ 6,500,000
Second quarter year 7........................................................................... $ 6,500,000
</TABLE>
The Senior Credit Facility is guaranteed by all subsidiaries of the Company
who, except for Supermarket Cigarette Sales, Inc., are also borrowers under the
Senior Credit Facility. Obligations under the Senior Credit Facility are secured
by a first priority lien on all of the Company's and the guarantors' existing
and after-acquired tangible and intangible assets, including but not limited to
accounts and notes receivable, inventory, machinery, equipment and other fixed
assets (including, but not limited to, fixtures and leasehold improvements),
real property (including leasehold interests but excluding real property already
subject to liens), all related documents, instruments, chattel paper, subsidiary
stock, and general intangibles (including, but not limited to, patents,
trademarks, trade names and tax refunds) and all proceeds and products thereof.
Loans under the Senior Credit Facility, at the Company's option, may be
either Base Rate Loans or Eurodollar Loans, provided that not more than six
Eurodollar Loans may be outstanding at any one time. Base Rate Loans will bear
interest at a Base Rate plus the Applicable Margin and Eurodollar Loans will
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bear interest at the LIBO Rate (as adjusted pursuant to the terms of the Senior
Credit Facility) plus the Applicable Margin for 1-, 2-, 3- or 6-month interest
periods. The Base Rate is defined as the higher of (i) the announced prime rate
of Fleet Bank, N.A. and (ii) the federal funds rate plus 1/2%, with changes
effective as of the date of change in such prime rate or federal funds rate. The
Company may convert all or any portion of the Base Rate Loans into Eurodollar
Loans, and all or any portion of the Eurodollar Loans into Base Rate Loans
provided no event of default has occurred or is continuing.
At all times on and after the Closing Date until the date the Company
delivers to the agent under the Senior Credit Facility its financial statements
for the Company's fiscal quarter ending on or about January 10, 1998 (the "First
Adjustment Date"), the Applicable Margin will be 0.75% for Base Rate Loans and
2.0% for Eurodollar Loans.
At the Closing Date, the Senior Credit Facility bore interest at
approximately 7.65% based on the LIBO Rate plus the Applicable Margin. Beginning
on the First Adjustment Date, interest rates will fluctuate based on the
Company's ratio of Indebtedness to EBITDA (each as defined in the Senior Credit
Facility) for the four most recently concluded fiscal quarters, based upon the
following table:
<TABLE>
<CAPTION>
APPLICABLE MARGIN
BASE RATE/EURODOLLAR
INDEBTEDNESS/EBITDA RATE
<S> <C>
Greater Than or Equal to 5.............................................................. 1.00%/2.25%
Greater Than 4.25 but Less Than 5....................................................... 0.75%/2.00%
Greater Than 3.75 but Less Than 4.25.................................................... 0.50%/1.75%
Greater Than 3.25 but Less Than 3.75.................................................... 0.25%/1.50%
Less Than 3.25.......................................................................... 0%/1.25%
</TABLE>
Notwithstanding the foregoing, on and after a default or event of default
under the Senior Credit Facility which is continuing, there will be no reduction
in the Applicable Margin. After and during the continuance of any such event of
default, the interest rate will be 2% above the otherwise applicable rate.
The Senior Credit Facility contains numerous restrictive financial and other
covenants, including, but not limited to (i) limitations on the incurrence of
liens and indebtedness, (ii) restrictions on sale and lease-back transactions,
consolidations, mergers and sales of assets, investments (including the purchase
of stock or assets), loans, capital expenditures, changes in business,
prepayment of indebtedness, including the Senior Notes and the Notes, affiliate
transactions, consulting fees and creation of subsidiaries, (iii) a prohibition
(with certain limited exceptions) on dividends, distributions and payments on
shares of capital stock, and (iv) a requirement to meet certain identified
financial targets, based generally on rolling four fiscal quarter periods, such
as a maximum leverage ratio, a minimum interest coverage ratio, a minimum cash
flow and, under certain circumstances, a minimum fixed charge coverage ratio.
Events of default under the Senior Credit Facility include, among others,
(i) false representations and warranties, (ii) nonpayment of interest, fees or
principal when due under the Senior Credit Facility, (iii) breach in the
observance or performance of any covenant, condition or agreement, (iv)
voluntary or involuntary bankruptcy proceedings, (v) default in any other
indebtedness that permits acceleration of such indebtedness, (vi) any events or
conditions which would result in the termination of a pension plan or the
creation of certain liabilities under ERISA, (vii) judgments or decrees that
remain undischarged or unbonded for 30 consecutive days, (viii) the invalidity
of the Senior Credit Facility, the other security documents, security interests
or guarantees and (ix) the occurrence of a Change of Control. Change of Control
is defined as (A) the failure of the Fund to own, beneficially and all voting
rights with respect to, at least 35% of each class of issued and outstanding
shares of voting stock of the Company, (B) the failure of the Fund to own
capital stock of the Company entitling it to cast the votes required to elect a
majority of members of the Board of Directors of the Company, (C) the failure of
the Company to own, beneficially and all voting rights with respect to, 100% of
all the issued and outstanding shares of each class of capital stock of each of
its subsidiaries (other than Delchamps, following the Delchamps Tender Offer and
prior to the Delchamps Merger) or (D) the occurrence of a "Change of Control"
under the Senior Note Indenture.
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Upon the occurrence of any event of default under the Senior Credit Facility,
the Lender may accelerate the maturity of the loans made thereunder and
terminate the commitments under the Senior Credit Facility.
SENIOR NOTES
Jitney-Jungle is the primary obligor on $200,000,000 in aggregate principal
amount of Senior Notes. The Senior Notes bear interest at a rate of 12% per
annum, payable semi-annually on March 1 and September 1 of each year.
Jitney-Jungle is not required to make any mandatory redemption or sinking
fund payment with respect to the Senior Notes prior to maturity. The Senior
Notes are redeemable, at the option of Jitney-Jungle, in whole or in part, at
any time after March 1, 2001 at the redemption prices set forth in the Senior
Note Indenture. In addition, at any time prior to March 1, 1999, Jitney-Jungle
may redeem up to 33 1/3% of the aggregate principal amount of the Senior Notes
with the net proceeds of one or more public offerings of equity securities;
provided that at least 66 2/3% of the original aggregate principal amount of
Senior Notes remains outstanding following each such redemption.
Upon the occurrence of a "Change of Control" under the Senior Note
Indenture, Jitney-Jungle will be required to make an offer to purchase all of
the outstanding Senior Notes at 101% of the principal amount thereof, plus
accrued and unpaid interest to the date of purchase.
The Senior Notes are unsecured senior obligations of Jitney-Jungle and rank
pari passu in right of payment with all existing and future Senior Debt of
Jitney-Jungle, including indebtedness under the Senior Credit Facility.
Jitney-Jungle's obligations under certain outstanding Senior Debt, including its
obligations under the Senior Credit Facility, are secured by liens on all of the
assets of Jitney-Jungle and, accordingly, such indebtedness ranks prior to the
Senior Notes with respect to such assets. The Senior Notes rank senior in right
of payment to all future subordinated indebtedness of Jitney-Jungle, including
the Notes.
The payment of principal, premium, if any, and interest on the Senior Notes
has been guaranteed on a full, unconditional, joint and several, unsecured
senior basis (the "Senior Note Guarantees") by all of the Subsidiary Guarantors,
and Delchamps will execute a Senior Note Guarantee within three business days
following the consummation of the Delchamps Tender Offer. The Senior Note
Guarantees rank pari passu in right of payment with all Senior Debt of the
Subsidiary Guarantors. The Subsidiary Guarantors' obligations under certain
outstanding Senior Debt, including their obligations under the Senior Credit
Facility, are secured by liens on substantially all of the assets of the
Subsidiary Guarantors and, accordingly, rank prior to the Senior Notes with
respect to such assets. The guarantee of a Subsidiary Guarantor may be released
upon a sale of such Subsidiary Guarantor or upon repayment or defeasance of the
Senior Notes, in each case as permitted by the Senior Note Indenture.
The Senior Note Indenture contains restrictive covenants substantially
identical to those contained in the Indenture governing the Notes (except with
respect to the subordination provisions of the Indenture), including covenants
that limit, among other things, (i) the ability of Jitney-Jungle and its
Restricted Subsidiaries to pay dividends or make certain other restricted
payments or investments, incur additional indebtedness or issue preferred stock,
in each case, unless specified financial targets are met, (ii) the ability of
Jitney-Jungle to merge, consolidate or sell all or substantially all of its
assets, (iii) the ability of Jitney-Jungle and its Restricted Subsidiaries to
create liens on assets, (iv) the ability of Jitney-Jungle and its Restricted
Subsidiaries to enter into transactions with affiliates and (v) the ability of
Jitney-Jungle and its Restricted Subsidiaries to engage in other lines of
business. See "Description of the Notes" for a more complete description of such
provisions.
The Senior Note Indenture would prohibit the issuance of the Notes. The
Company has obtained consents from the holders of a majority in principal amount
of the outstanding Senior Notes to such issuance. See "Summary--The
Transactions" and "The Transactions--The Consent Solicitation."
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DESCRIPTION OF THE NOTES
GENERAL
The Existing Notes were issued pursuant to an Indenture (the "Indenture") by
and among the Company, each Subsidiary of the Company as Subsidiary Guarantors
and Marine Midland Bank, as trustee (the "Trustee") in a private transaction
that was not subject to the registration requirements of the Securities Act. The
terms of the Indenture apply to the Existing Notes and to the New Notes to be
issued in exchange therefor pursuant to the Exchange Offer (all such Notes being
referred to herein collectively as the "Notes"). The terms of the Notes include
those stated in the Indenture and those made part of the Indenture by reference
to the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"). The
Notes are subject to all such terms, and Holders of Notes are referred to the
Indenture and the Trust Indenture Act for a statement thereof. The following
summary of certain provisions of the Indenture is qualified by reference to the
Indenture, including the definitions therein of certain terms used below. Copies
of the proposed form of Indenture and Registration Rights Agreement are
available as set forth under "--Additional Information." The definitions of
certain terms used in the following summary are set forth below under "Certain
Definitions."
The Notes are general unsecured obligations of the Company and are
subordinated in right of payment to all current and future Senior Debt. At July
26, 1997, on a Pro Forma Basis, the Company would have had Senior Debt of
approximately $348.1 million (exclusive of an unused commitment of up to $66.1
million under the Senior Credit Facility). The Indenture permits the incurrence
of additional Senior Debt in the future. See "Certain Covenants--Incurrence of
Indebtedness and Issuance of Disqualified Stock."
PRINCIPAL, MATURITY AND INTEREST
The Notes are limited in aggregate principal amount to $200.0 million and
will mature on September 15, 2007. Interest on the Notes will accrue at the rate
of 10 3/8% per annum and will be payable semi-annually in arrears on March 15
and September 15 of each year, commencing on March 15, 1998 to Holders of record
on the immediately preceding March 1 and September 1. Interest on the Notes will
accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from the date of original issuance. Interest will be
computed on the basis of a 360-day year comprised of twelve 30-day months.
Principal, premium, if any, and interest and Liquidated Damages, if any, on the
Notes will be payable at the office or agency of the Company maintained for such
purpose within the City and State of New York or, at the option of the Company,
payment of interest and Liquidated Damages, if any, may be made by check mailed
to the Holders of the Notes at their respective addresses set forth in the
register of Holders of Notes; provided that all payments of principal, premium,
if any, and interest with respect to the Notes the Holders of which have given
wire transfer instructions to the Company will be required to be made by wire
transfer of immediately available funds to the accounts specified by the Holders
thereof. Until otherwise designated by the Company, the Company's office or
agency in New York will be the office of the Trustee maintained for such
purpose. The Notes will be issued in denominations of $1,000 and integral
multiples thereof.
SUBORDINATION
The payment of principal of, premium, if any, and interest and Liquidated
Damages, if any, on the Notes will be subordinated in right of payment, as set
forth in the Indenture, to the prior payment in full of all Senior Debt, whether
outstanding on the date of the Indenture or thereafter incurred.
Upon any distribution to creditors of the Company in a liquidation or
dissolution of the Company or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or its property, an
assignment for the benefit of creditors or any marshalling of the Company's
assets and liabilities, the holders of Senior Debt will be entitled to receive
payment in full in cash of all Obligations due in respect of such Senior Debt
(including interest after the commencement of any such proceeding at
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the rate specified in the applicable Senior Debt) before the Holders will be
entitled to receive any payment with respect to the Notes, and until all
Obligations with respect to Senior Debt are paid in full in cash, any
distribution to which the Holders would be entitled shall be made to the holders
of Senior Debt (except that Holders may receive Permitted Junior Securities and
payments made from the trust described under "--Legal Defeasance and Covenant
Defeasance").
The Company also may not make any payment upon or in respect of the Notes
(except in Permitted Junior Securities or from the trust described under
"--Legal Defeasance and Covenant Defeasance") if (i) a default in the payment of
the principal of, premium, if any, or interest on Designated Senior Debt occurs
and is continuing beyond any applicable period of grace or (ii) any other
default occurs and is continuing with respect to Designated Senior Debt that
permits holders of such Designated Senior Debt to accelerate its maturity and
the Trustee receives a notice of such default (a "Payment Blockage Notice") from
the Company or the representative of the holders of such Designated Senior Debt.
Payments on the Notes may and shall be resumed (a) in the case of a payment
default, upon the date on which such default is cured or waived and (b) in case
of a nonpayment default, the earlier of (x) the date on which such nonpayment
default is cured or waived, (y) 179 days after the date on which the applicable
Payment Blockage Notice is received, in each case, unless the maturity of any
Designated Senior Debt has been accelerated or (z) the date on which such
Payment Blockage Period (as defined below) shall have been terminated by written
notice to the Trustee from the representative of the holders of Designated
Senior Debt initiating such Payment Blockage Period. During any consecutive
360-day period, the aggregate number of days in which payments due on the Notes
may not be made as a result of nonpayment defaults on Designated Senior Debt (a
"Payment Blockage Period") shall not exceed 179 days, and there shall be a
period of at least 181 consecutive days in each consecutive 360-day period
during which no Payment Blockage Period is in effect. No nonpayment default that
existed or was continuing on the date of delivery of any Payment Blockage Notice
to the Trustee shall be, or be made, the basis for a subsequent Payment Blockage
Notice unless such default shall have been cured or waived for a period of not
less than 90 days.
The Indenture further requires that the Company promptly notify holders of
Senior Debt if payment of the Notes is accelerated because of an Event of
Default.
As a result of the subordination provisions described above, in the event of
a liquidation or insolvency, Holders of the Notes may recover less ratably than
creditors of the Company who are holders of Senior Debt. See "Risk
Factors--Subordination."
SUBSIDIARY GUARANTEES
The Company's payment obligations under the Notes are guaranteed on a full,
unconditional, joint and several, general unsecured basis (the "Subsidiary
Guarantees") by the Subsidiary Guarantors. The obligations of each Subsidiary
Guarantor under its Subsidiary Guarantee is limited to the lesser of (i) the
aggregate amount of the Obligations of the Company under the Notes and the
Indenture and (ii) the amount, if any, which would not have (A) rendered such
Subsidiary Guarantor "insolvent" (as such term is defined in the United States
Bankruptcy Code and in the Debtor and Creditor Law of the State of New York) or
(B) left such Subsidiary Guarantor with unreasonably small capital at the time
its Subsidiary Guarantee of the Notes was entered into; provided that it will be
a presumption in any lawsuit or other proceeding in which a Subsidiary Guarantor
is a party that the amount guaranteed pursuant to the Subsidiary Guarantee is
the amount set forth in clause (i) above unless any creditor, or representative
of creditors of such Subsidiary Guarantor, or debtor in possession or trustee in
bankruptcy of the Subsidiary Guarantor, otherwise proves in such a lawsuit that
the aggregate liability of the Subsidiary Guarantor is the amount set forth in
clause (ii) above. The Indenture provides that, in making any determination as
to solvency or sufficiency of capital of a Subsidiary Guarantor in accordance
with the previous sentence, the right of such Subsidiary Guarantor to
contribution from other Subsidiary Guarantors, and any other rights such
Subsidiary Guarantor may have, will be taken into account. See, however, "Risk
Factors--Fraudulent Conveyance Considerations."
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The Subsidiary Guarantee of each Subsidiary Guarantor is subordinated to the
prior payment in full of all existing and future Senior Debt of such Subsidiary
Guarantor, including the guarantee of such Subsidiary Guarantor of the Company's
obligations under the Senior Notes and the Senior Credit Facility. At July 26,
1997, on a Pro Forma Basis, the Subsidiary Guarantors would have had an
aggregate of approximately $10.4 million of Senior Debt outstanding (excluding
guarantees by the Subsidiary Guarantors of the Company's obligations under the
Senior Notes and the Senior Credit Facility). The Indenture permits the
Subsidiary Guarantors to incur additional Senior Debt, subject to certain
limitations.
The Indenture provides that, except as may be prohibited by the terms of the
Indenture described herein under "Certain Covenants" and "Repurchase at the
Option of Holders--Change of Control" and "--Asset Sales," nothing contained in
the Indenture or in any of the Notes will prevent any consolidation or merger of
a Subsidiary Guarantor with or into a corporation or corporations other than the
Company or any other Subsidiary Guarantor (in each case, whether or not
affiliated with the Subsidiary Guarantor), or successive consolidations or
mergers in which a Subsidiary Guarantor or its successor or successors will be a
party or parties, or will prevent any sale or conveyance of the property of a
Subsidiary Guarantor as an entirety or substantially as an entirety, to a
corporation other than the Company or any other Subsidiary Guarantor (in each
case, whether or not affiliated with the Subsidiary Guarantor) authorized to
acquire and operate the same; PROVIDED, however, that each Subsidiary Guarantor
covenants and agrees that: (i) upon any such consolidation, merger, sale or
conveyance, the Subsidiary Guarantee endorsed on the Notes, and the due and
punctual performance and observance of all of the covenants and conditions of
the Indenture to be performed by such Subsidiary Guarantor, will be expressly
assumed (in the event that the Subsidiary Guarantor is not the surviving
corporation in the merger), by a supplemental indenture substantially in the
form provided for in the Indenture, executed and delivered to the Trustee, by
the corporation formed by such consolidation, or into which the Subsidiary
Guarantor shall have been merged, or by the corporation which shall have
acquired such property; (ii) immediately after giving effect to such
transaction, no Default or Event of Default exists; and (iii) the Company would
be permitted, immediately after giving effect to such transaction, to incur at
least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage
Ratio test set forth in the covenant described below under the caption "Certain
Covenants--Incurrence of Indebtedness and Issuance of Disqualified Stock." The
foregoing will not prohibit (i) any consolidation or merger of a Subsidiary
Guarantor with or into the Company or any other Subsidiary Guarantor or (ii) any
sale or conveyance of the property of a Subsidiary Guarantor as an entirety or
substantially as an entirety, to the Company or any other Subsidiary Guarantor.
The Indenture provides that concurrently with any sale of assets (including,
if applicable, all of the Capital Stock of any Subsidiary Guarantor), any Liens
in favor of the Trustee in the assets sold thereby will be released; PROVIDED
that, in the event of an Asset Sale, the Net Proceeds from such sale or other
disposition are treated in accordance with the provisions of the covenant
described herein under the caption "Repurchase at the Option of Holders--Asset
Sales." The Indenture further provides that if the assets sold in such sale or
other disposition include all or substantially all of the assets of any
Subsidiary Guarantor or all of the Capital Stock of any Subsidiary Guarantor,
then such Subsidiary Guarantor (in the event of a sale or other disposition of
all of the Capital Stock of such Subsidiary Guarantor) or the corporation
acquiring the property (in the event of a sale or other disposition of all or
substantially all of the assets of a Subsidiary Guarantor) will be released from
and relieved of its Obligations under its Subsidiary Guarantee; PROVIDED that
(i) in the event of an Asset Sale, the Net Proceeds from such sale or other
disposition are treated in accordance with the provisions of the covenant
described herein under the caption "Repurchase at the Option of Holders--Asset
Sales" and (ii) the Company is in compliance with all other provisions of the
Indenture applicable to such disposition.
OPTIONAL REDEMPTION
Except as provided in the following paragraph, the Notes are not redeemable
at the Company's option prior to September 15, 2002. Thereafter, the Notes are
subject to redemption at the option of the
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Company, in whole or in part, upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below plus accrued and unpaid interest and Liquidated Damages, if any,
thereon to the applicable redemption date, if redeemed during the twelve-month
period beginning on September 15 of the years indicated below:
<TABLE>
<CAPTION>
YEAR PERCENTAGE
<S> <C>
2002.......................................................... 105.188%
2003.......................................................... 103.458%
2004.......................................................... 101.729%
2005 and thereafter........................................... 100.000%
</TABLE>
Notwithstanding the foregoing, at any time prior to September 15, 2000 the
Company may on any one or more occasions redeem up to 33 1/3% of the aggregate
principal amount of Notes originally issued in the Offering at a redemption
price of 110.375% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the redemption date, with
the net proceeds of one or more Public Equity Offerings; PROVIDED that at least
66 2/3% of the original aggregate principal amount of Notes remains outstanding
immediately after the occurrence of each such redemption; and PROVIDED, further,
that each such redemption shall occur within 120 days of the date of the closing
of the Public Equity Offering to which it relates.
MANDATORY REDEMPTION
Except as set forth below under "Repurchase at the Option of Holders," the
Company is not required to make mandatory redemption or sinking fund payments
with respect to the Notes.
REPURCHASE AT THE OPTION OF HOLDERS
CHANGE OF CONTROL
The Indenture provides that upon the occurrence of a Change of Control, each
Holder will have the right to require the Company to repurchase all or any part
(equal to $1,000 or an integral multiple thereof) of such Holder's Notes
pursuant to the offer described below (the "Change of Control Offer") at a price
in cash equal to 101% of the aggregate principal amount thereof plus accrued and
unpaid interest and Liquidated Damages, if any, thereon to the date of purchase
(the "Change of Control Payment"). Within 30 days following any Change of
Control, the Company will mail or cause to be mailed a notice to each Holder
describing the transaction or transactions that constitute the Change of Control
and offering to repurchase Notes pursuant to the procedures required by the
Indenture and described in such notice. The Company will comply with the
requirements of Rule 14e-1 under the Exchange Act and any other securities laws
and regulations thereunder to the extent such laws and regulations are
applicable in connection with the repurchase of the Notes as a result of a
Change of Control. To the extent that the provisions of any securities laws or
regulations conflict with the provisions of the Indenture, the Company will
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations described in the Indenture by virtue
thereof.
The Indenture provides that, prior to complying with the provisions of this
covenant, but in any event within 30 days following a Change of Control, the
Company will either repay all outstanding Senior Debt, or offer to repay in full
all outstanding Senior Debt and repay the Senior Debt with respect to which such
offer has been accepted, or obtain the requisite consents, if any, under all
outstanding Senior Debt to permit the repurchase of the Notes required by this
covenant.
The Indenture provides that on the payment date set forth in the Change of
Control Offer (the "Change of Control Payment Date"), the Company will, to the
extent lawful, (1) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer, (2) deposit with the Trustee
or with the Paying Agent (or, if the Company or any of its subsidiaries is the
Paying Agent,
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separate and hold in trust) an amount in same-day funds equal to the Change of
Control Payment in respect of all Notes or portions thereof so tendered and (3)
deliver or cause to be delivered to the Trustee for cancellation the Notes so
accepted together with an Officers' Certificate stating that such Notes or
portions thereof have been tendered to and purchased by the Company. The
Indenture provides that the Paying Agent will promptly mail to each Holder of
Notes so tendered the Change of Control Payment for such Notes, and the Trustee
will promptly authenticate and mail (or cause to be transferred by book entry)
to each Holder a new Note equal in principal amount to any unpurchased portion
of the Notes surrendered, if any; PROVIDED that each such new Note will be in a
principal amount of $1,000 or an integral multiple thereof. The Company will
publicly announce the results of the Change of Control Offer on or as soon as
practicable after the Change of Control Payment Date.
Except as described above with respect to a Change of Control, the Indenture
does not contain provisions that permit the Holders of the Notes to require that
the Company repurchase or redeem the Notes in the event of a takeover,
recapitalization or similar restructuring.
The existence of a Holder's right to require the Company to repurchase such
Holder's Notes upon the occurrence of a Change of Control may deter a third
party from seeking to acquire the Company in a transaction that would constitute
a Change of Control.
"CHANGE OF CONTROL" means the occurrence of any of the following: (i) the
sale, lease, transfer, conveyance or other disposition (other than by way of
merger or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Company and its Restricted Subsidiaries
taken as a whole to any "person" (as such term is used in Section 13(d)(3) of
the Exchange Act) other than the Principals, their Related Parties, the DLJ
Entities or their Affiliates, (ii) the adoption of a plan relating to the
liquidation or dissolution of the Company, (iii) the Company consolidates with,
or merges with or into, another "person" (as defined above) in a transaction or
series of related transactions in which the voting stock of the Company is
converted into or exchanged for cash, securities or other property, other than
any transaction where (A) the outstanding voting stock of the Company is
converted into or exchanged for voting stock (other than Disqualified Stock) of
the surviving or transferee corporation and (B) either (1) the "beneficial
owners" (as such term is defined in Rule 13d-3 and 13d-5 under the Exchange Act)
of the voting power of the voting stock of the Company immediately prior to such
transaction own, directly or indirectly through one or more Subsidiaries, not
less than a majority of the total voting power of the voting stock of the
surviving or transferee corporation immediately after such transaction or (2) if
immediately prior to such transaction the Company is a direct or indirect
Subsidiary of any other Person (the "Holding Company"), then the "beneficial
owners" (as defined above) of the voting stock of such Holding Company
immediately prior to such transaction own, directly or indirectly through one or
more Subsidiaries, not less than a majority of the voting power of the voting
stock of the surviving or transferee corporation immediately after such
transaction, (iv) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that (A) the
Principals, their Related Parties, the DLJ Entities or their Affiliates cease to
be the "beneficial owners" (as defined above), directly or indirectly, of at
least 35% of the voting power of the voting stock of the Company and (B) any
"person" (as defined above) becomes the "beneficial owner" (as defined above;
PROVIDED that at any time following the occurrence of a Public Equity Offering,
the term "beneficial owner" shall exclude for such purpose the effect of Rule
13d-3(d)(1), other than any such effect with respect to the Warrants) directly
or indirectly, of more of the voting power of the voting stock of the Company
than is at the time "beneficially owned" (as defined above) by the Principals,
their Related Parties, the DLJ Entities and their Affiliates in the aggregate,
or (v) the first day on which a majority of the members of the Board of
Directors of the Company are not Continuing Directors. For purposes of this
definition, any transfer of an equity interest of an entity that was formed for
the purpose of acquiring voting stock of the Company will be deemed to be a
transfer of such portion of such voting stock as corresponds to the portion of
the equity of such entity that has been so transferred.
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The definition of Change of Control includes a phrase relating to the sale,
lease, transfer, conveyance or other disposition of "all or substantially all"
of the assets of the Company and its Restricted Subsidiaries taken as a whole.
Although there is a developing body of case law interpreting the phrase
"substantially all," there is no precise established definition of the phrase
under applicable law. Accordingly, the ability of a Holder of Notes to require
the Company to repurchase such Notes as a result of a sale, lease, transfer,
conveyance or other disposition of less than all of the assets of the Company
and its Restricted Subsidiaries taken as a whole to another Person or group may
be uncertain.
"CONTINUING DIRECTORS" means, as of any date of determination, any member of
the Board of Directors of the Company who (i) was a member of such Board of
Directors on the date of the Indenture or (ii) was nominated for election or
elected to such Board of Directors with the approval of a majority of the
Continuing Directors who were members of such Board at the time of such
nomination or election.
"DLJ ENTITIES" means DLJ Merchant Banking Partners, L.P., DLJ Offshore
Partners, C.V. and DLJ Merchant Banking Funding, Inc.
"PRINCIPALS" means (i) the Fund and any of its Affiliates and (ii) Messrs.
W. H. Holman, Jr., W. H. Holman III, Essary, Friou, Bruckmann, Rosser, Sherrill
and Edwards.
"RELATED PARTY" means (i) any controlling stockholder, general partner, 80%
(or more) owned Subsidiary, or spouse or immediate family member (in the case of
an individual) of any Principal or (ii) any trust, corporation, partnership or
other entity, the beneficiaries, stockholders, partners, owners or Persons
holding an 80% or more controlling interest of which consist solely of one or
more Principals and/or such other Persons referred to in the immediately
preceding clause (i).
ASSET SALES
The Indenture provides that the Company will not, and will not permit any of
its Restricted Subsidiaries to, engage in an Asset Sale unless (i) the Company
(or the Restricted Subsidiary, as the case may be) receives consideration at the
time of such Asset Sale at least equal to the fair market value (evidenced by a
resolution of the Board of Directors set forth in an Officers' Certificate
delivered to the Trustee) of the assets or Equity Interests issued or sold or
otherwise disposed of; and (ii) at least 75% of the consideration therefor
received by the Company or such Restricted Subsidiary is in the form of cash or
Cash Equivalents; PROVIDED that the amount of (x) any liabilities (as shown on
the Company's or such Restricted Subsidiary's most recent balance sheet or in
the notes thereto) of the Company or any Restricted Subsidiary (other than
liabilities that are by their terms subordinated to the Notes or any guarantee
thereof) that are assumed by the transferee of any such assets and (y) any notes
or other obligations received by the Company or any such Restricted Subsidiary
from such transferee that are immediately converted by the Company or such
Restricted Subsidiary into cash (to the extent of the cash received), shall be
deemed to be cash for purposes of this provision and PROVIDED further that (1)
the 75% limitation referred to above shall not apply to any Asset Sale in which
the cash or Cash Equivalents portion of the consideration received therefor,
determined in accordance with the foregoing proviso, is equal to or greater than
what the net after-tax proceeds would have been had such Asset Sale complied
with the aforementioned 75% limitation and (2) the provisions of clauses (i) and
(ii) above shall not apply to any sale or other disposition of assets required
pursuant to a consent order or other agreement entered into by the Company with
the Federal Trade Commission or the Department of Justice in connection with the
Delchamps Acquisition.
Within 435 days after the receipt of any Net Proceeds from an Asset Sale,
the Company or its Restricted Subsidiary, as the case may be, may apply such Net
Proceeds by (i) permanently reducing Indebtedness under the Senior Credit
Facility (and correspondingly reducing commitments with respect thereto) or
other Senior Debt, (ii) investing (or entering into a binding commitment to
invest) in any one or more business, capital expenditure or other tangible
asset, in each case in the same line of business as the Company or its
Restricted Subsidiaries was engaged in on the date of the Indenture or a line of
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business reasonably related thereto, (iii) investing (or entering into a binding
commitment to invest) in properties or assets that replace the properties and
assets that are the subject of such Asset Sale and (iv) in the case of a sale of
a store or stores, deeming such Net Proceeds to have been applied to the extent
of any capital expenditures made to acquire or construct another store within
435 days preceding the date of the Asset Sale; PROVIDED that if such Net
Proceeds are applied by entering into a binding commitment under clause (ii) or
(iii) above, then the investment contemplated by such commitment shall be made
no later than 45 days following the end of such 435 day period. Pending the
final application of any such Net Proceeds, the Company or its Restricted
Subsidiary, as the case may be, may temporarily reduce Indebtedness under the
Senior Credit Facility or otherwise invest such Net Proceeds in any manner that
is not prohibited by the Indenture. Any Net Proceeds from Asset Sales that are
not applied or invested as provided in the first sentence of this paragraph will
be deemed to constitute "Excess Proceeds." When the aggregate amount of Excess
Proceeds exceeds $15.0 million, the Company will be required to make an offer to
all Holders (an "Asset Sale Offer") to purchase the maximum principal amount of
Notes that may be purchased out of the Excess Proceeds, at a price in cash equal
to 100% of the principal amount thereof plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the date of purchase, in accordance with
the procedures set forth in the Indenture. To the extent that the aggregate
amount of Notes tendered pursuant to an Asset Sale Offer is less than the
aggregate amount of Excess Proceeds, the Company or its Restricted Subsidiary,
as the case may be, may use any remaining Excess Proceeds for general corporate
purposes. If the aggregate principal amount of Notes surrendered by Holders
thereof exceeds the aggregate amount of Excess Proceeds, the Trustee shall
select the Notes to be purchased in accordance with the terms of the Indenture.
Upon completion of each Asset Sale Offer, the amount of Excess Proceeds shall be
reset at zero.
CERTAIN RESTRICTIONS ON REPURCHASES
Certain of the Company's Senior Debt, including Indebtedness under the
Senior Credit Facility and the Senior Notes, currently prohibits or restricts
the Company from purchasing any Notes, and also provides that certain changes in
control of the Company and certain dispositions of Company assets would
constitute a default thereunder. Any future credit agreements or other
agreements relating to Senior Debt to which the Company becomes a party may
contain similar restrictions and provisions. In the event a Change of Control
occurs, or an Asset Sale Offer is required to be made, at a time when the
Company is prohibited from purchasing Notes, the Company could seek the consent
of its lenders to the purchase of Notes or could attempt to refinance the
borrowings that contain such prohibition. If the Company does not obtain such a
consent or repay such borrowings, the Company will remain prohibited from
purchasing Notes. In such case, the Company's failure to purchase tendered Notes
would constitute an Event of Default under the Indenture.
SELECTION AND NOTICE
If less than all of the Notes are to be redeemed at any time, selection of
Notes for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the
Notes are listed or, if the Notes are not so listed, on a pro rata basis, by lot
or by such other method as the Trustee shall deem fair and appropriate; PROVIDED
that no Notes of $1,000 or less shall be redeemed in part. Notices of redemption
shall be mailed by first class mail at least 30 but not more than 60 days before
the redemption date to each Holder of Notes to be redeemed at its registered
address. If any Note is to be redeemed in part only, the notice of redemption
that relates to such Note shall state the portion of the principal amount
thereof to be redeemed. A new Note in principal amount equal to the unredeemed
portion thereof will be issued in the name of the Holder thereof upon
cancellation of the original Note. On and after the redemption date, interest
will cease to accrue on Notes or portions thereof called for redemption.
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CERTAIN COVENANTS
RESTRICTED PAYMENTS
The Indenture provides that the Company will not, and will not permit any of
its Restricted Subsidiaries to, directly or indirectly: (i) declare or pay any
dividend or make any distribution (other than dividends or distributions payable
in Equity Interests (other than Disqualified Stock) of the Company or dividends
or distributions payable to the Company or any Restricted Subsidiary of the
Company that is a Subsidiary Guarantor) on account of the Company's or any of
its Restricted Subsidiaries' Equity Interests (including in connection with a
merger or consolidation); (ii) purchase, redeem or otherwise acquire or retire
for value any outstanding Equity Interests of the Company or any Affiliate of
the Company (other than any such Equity Interests owned by the Company or any
Wholly Owned Restricted Subsidiary of the Company that is a Subsidiary
Guarantor); (iii) make any principal payment on, or purchase, redeem, defease or
otherwise acquire or retire for value, prior to any scheduled principal payment,
any sinking fund date or its scheduled maturity date, any Indebtedness that is
subordinated to the Notes or the Subsidiary Guarantees; (iv) make any Restricted
Investment or (v) make any payment pursuant to the BRS Management Agreement (all
such payments and other actions set forth in clauses (i) through (v) above being
collectively referred to as "Restricted Payments"), unless:
(a) at the time of and after giving effect to such Restricted Payment,
no Default or Event of Default shall have occurred and be continuing or
would occur as a consequence thereof; and
(b) the Company would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made
at the beginning of the applicable four-quarter period, have been permitted
to incur at least $1.00 of additional Indebtedness pursuant to the Fixed
Charge Coverage Ratio test set forth in the first paragraph of the covenant
described below under the caption "Certain Covenants--Incurrence of
Indebtedness and Issuance of Disqualified Stock"; and
(c) such Restricted Payment, together with the aggregate of all other
Restricted Payments made by the Company and its Restricted Subsidiaries
after the date of the Indenture (excluding Restricted Payments permitted by
clauses (o), (s)(ii), (x) and (y) of the next succeeding paragraph), is less
than the sum of (i) 50% of the Consolidated Net Income of the Company for
the period (taken as one accounting period) from the beginning of the first
fiscal quarter commencing after the date of the Indenture to the end of the
Company's most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment (or, if such
Consolidated Net Income for such period is a deficit, 100% of such deficit),
plus (ii) 100% of the aggregate net cash proceeds (or non-cash proceeds when
converted into cash) received by the Company in the form of capital
contributions or from the issue, sale or exercise since the date of the
Indenture of Equity Interests of the Company or of debt securities of the
Company that have been converted into such Equity Interests (other than
Equity Interests (or convertible debt securities) sold to a Subsidiary of
the Company and other than Disqualified Stock or debt securities that have
been converted into Disqualified Stock), plus (iii) to the extent that any
Restricted Investment that was made after the date of the Indenture is sold
for cash or otherwise liquidated or repaid for cash, the lesser of (A) the
cash return of capital with respect to such Restricted Investment (less the
cost of disposition, if any) and (B) the initial amount of such Restricted
Investment, plus (iv) 50% of the excess, if any, of the cash received upon
the sale or other disposition of a Restricted Investment over the amount
described in clause (iii) above.
The foregoing provisions do not prohibit: (o) any repurchase, redemption or
retirement for value of capital stock of a Restricted Subsidiary of the Company
deemed to occur upon the merger of such Restricted Subsidiary with or into the
Company or another Wholly Owned Restricted Subsidiary of the Company within one
year following the date on which such merged Restricted Subsidiary became a
Restricted Subsidiary of the Company; (p) acquisition and retirement by the
Company of any Class B Preferred Stock in satisfaction of any claim by the
Company for indemnity pursuant to the 1996 Merger
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Agreement; (q) retirement of the Class A Preferred Stock in connection with the
issuance by the Company of the Exchange Debentures; (r) the payment of cash in
lieu of the issuance of (A) fractional shares of common stock upon exercise of
the Warrants and (B) any Exchange Debenture that is not an integral multiple of
$1,000 upon any exchange of Class A Preferred Stock for Exchange Debentures; (s)
the amendment of the BRS Management Agreement to permit the payment of, and the
payment of, fees to BRS or any Affiliate of BRS (i) under the BRS Management
Agreement after the end of each fiscal quarter in an amount not to exceed the
greater of (a) $250,000 or (b) 1.0% of the Company's EBITDA for such fiscal
quarter (PROVIDED, that the total amount of all such payments shall not exceed
in any fiscal year the greater of (x) $1.0 million or (y) one percent of the
Company's EBITDA for such fiscal year) and (ii) in connection with the Delchamps
Acquisition in an amount not to exceed $5.0 million in the aggregate; (t) the
payment of dividends on the Company's capital stock, following the first Public
Equity Offering after the date of the Indenture, of up to 6.0% of the aggregate
proceeds to the Company in such Public Equity Offering, other than a public
offering with respect to the Company's common stock registered on Form S-8; (u)
the payment of any dividend within 60 days after the date of declaration
thereof, if at said date of declaration such payment would have complied with
the provisions of the Indenture; (v) the repurchase of the Class A Preferred
Stock in accordance with the terms thereof upon the occurrence of a Change of
Control; (w) the redemption of Exchange Debentures in accordance with the terms
thereof upon the occurrence of a Change of Control; (x) the redemption,
repurchase, retirement or other acquisition of any Equity Interests of the
Company in exchange for, or out of the proceeds of, the substantially concurrent
sale (other than to a Restricted Subsidiary of the Company) of other Equity
Interests of the Company (other than any Disqualified Stock); PROVIDED that the
amount of any such net cash proceeds that are utilized for any such redemption,
repurchase, retirement or other acquisition shall be excluded from clause (c)
(ii) of the preceding paragraph; (y) the defeasance, redemption, repurchase,
retirement or other acquisition of subordinated Indebtedness with the net cash
proceeds from an incurrence of Permitted Refinancing Indebtedness or the
substantially concurrent sale (other than to a Restricted Subsidiary of the
Company) of Equity Interests of the Company (other than Disqualified Stock);
PROVIDED that the amount of any such net cash proceeds that are utilized for any
such redemption, repurchase, defeasance, retirement or other acquisition shall
be excluded from clause (c) (ii) of the preceding paragraph; and (z) the
repurchase, redemption, defeasance or other acquisition or retirement for value
of any Equity Interests of the Company or any Restricted Subsidiary of the
Company held by any member of the Company's (or any of its Restricted
Subsidiaries') management pursuant to any management equity subscription
agreement or stock option agreement in effect as of the date of the Indenture or
any other option plan adopted by the Board of Directors of the Company; PROVIDED
that the aggregate price paid for all such repurchased, redeemed, defeased,
acquired or retired Equity Interests shall not exceed $2.0 million in any
twelve-month period plus (i) the aggregate cash proceeds received by the Company
during such twelve-month period from any issuance of Equity Interests by the
Company to members of management of the Company and its Restricted Subsidiaries
and (ii) the proceeds of any insurance policy to the extent applied toward such
repurchase, redemption, defeasance or other acquisition or retirement for value
of such Equity Interests; PROVIDED, that with respect to clause (z) above, no
Default or Event of Default shall have occurred and be continuing immediately
after such transaction.
As of the date of the Indenture, all of the Company's Subsidiaries are
Restricted Subsidiaries. The Board of Directors may designate any Restricted
Subsidiary (other than Interstate Jitney Jungle Stores, Inc., McCarty-Holman
Co., Inc., Southern Jitney Jungle Company, Pump And Save, Inc., DAC, Supermarket
Cigarette Sales, Inc. ("SCSI") and Delchamps, Inc.) to be an Unrestricted
Subsidiary if such designation would not cause a Default. For purposes of making
such determination, all outstanding Investments by the Company and its
Restricted Subsidiaries (except to the extent repaid in cash) in the Subsidiary
so designated will be deemed to be Restricted Payments at the time of such
designation and will reduce the amount available for Restricted Payments under
the first paragraph of this covenant. All such outstanding Investments will be
deemed to constitute Investments in an amount equal to the greatest of (x) the
net book value of such Investments at the time of such designation and (y) the
fair market value of
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such Investments at the time of such designation. Such designation will only be
permitted if such Restricted Payment would be permitted at such time and if such
Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary.
The amount of all Restricted Payments (other than cash) shall be the fair
market value (evidenced by a resolution of the Board of Directors set forth in
an Officers' Certificate delivered to the Trustee) on the date of the Restricted
Payment of the asset(s) proposed to be transferred by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
Not later than the date of making any Restricted Payment, the Company shall
deliver to the Trustee an Officers' Certificate stating that such Restricted
Payment is permitted and setting forth the basis upon which the calculations
required by the covenant "Restricted Payments" were computed, which calculations
may be based upon the Company's latest available internal financial statements.
INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF DISQUALIFIED STOCK
The Indenture provides that the Company will not, and will not permit any of
its Restricted Subsidiaries to, directly or indirectly, create, incur, issue,
assume, Guarantee or otherwise become directly or indirectly liable,
contingently or otherwise, with respect to (collectively, "incur") any
Indebtedness (including Acquired Indebtedness) and that the Company will not
issue and will not permit any of its Restricted Subsidiaries to issue any
Disqualified Stock (other than the Preferred Stock); PROVIDED, however, that the
Company or its Restricted Subsidiaries may incur Indebtedness (including
Acquired Indebtedness) or issue shares of Disqualified Stock if the Fixed Charge
Coverage Ratio for the Company's most recently ended four full fiscal quarters
for which internal financial statements are available immediately preceding the
date on which such additional Indebtedness is incurred or such Disqualified
Stock is issued would have been (A) at least 2.25 to 1.0 if such date is prior
to September 15, 2000 and (B) 2.50 to 1.0 if such date is on or after September
15, 2000, in each case determined on a pro forma basis (including a pro forma
application of the net proceeds therefrom), as if the additional Indebtedness
had been incurred, or the Disqualified Stock had been issued, as the case may
be, at the beginning of such four-quarter period.
The foregoing provisions do not apply to:
(i) the incurrence by the Company or any of its Restricted Subsidiaries
of Indebtedness and reimbursement obligations in respect of letters of
credit pursuant to the Senior Credit Facility (with letters of credit being
deemed to have a principal amount equal to the maximum potential liability
of the Company and its Restricted Subsidiaries thereunder) in an aggregate
principal amount not to exceed an amount equal to (x) the greater of (1) the
amount of the Borrowing Base and (2) $150.0 million less the aggregate
amount of all Net Proceeds of Asset Sales applied to permanently reduce the
total commitments with respect to such Indebtedness pursuant to the covenant
described above under the caption "Repurchase at Option of Holders--Asset
Sales" plus (y) $50.0 million less any outstanding Indebtedness incurred
pursuant to clause (viii) below;
(ii) the incurrence by the Company or any of its Restricted Subsidiaries
of the Existing Indebtedness;
(iii) the incurrence by the Company or any of its Restricted Subsidiaries
of Indebtedness represented by the Notes, the New Notes and the Subsidiary
Guarantees;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries
of Indebtedness represented by Capital Lease Obligations, mortgage or
construction financing or purchase money obligations, in each case incurred
for the purpose of financing all or any part of the purchase price or cost
of construction or improvement of property used in the business of the
Company or such Restricted Subsidiary, in an aggregate principal amount not
to exceed $30.0 million in any fiscal year; PROVIDED that the principal
amount (or, in the case of a Capital Lease Obligation, the amount required
to be capitalized on a balance sheet under GAAP) of such Indebtedness when
incurred shall not
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exceed the purchase price and/or actual cost of construction or improvement,
as the case may be, to which such incurrence relates;
(v) the incurrence by the Company or any of its Restricted Subsidiaries
of Permitted Refinancing Indebtedness in exchange for, or the net proceeds
of which are used to extend, refinance, renew, replace, defease or refund,
Indebtedness that was permitted by the Indenture to be incurred;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries
of intercompany Indebtedness between or among the Company and any of its
Wholly Owned Restricted Subsidiaries; PROVIDED, however, that (i) any
subsequent issuance or transfer (other than for security purposes) of Equity
Interests that results in any such Indebtedness being held by a Person other
than a Wholly Owned Restricted Subsidiary and (ii) any sale or other
transfer of any such Indebtedness to a Person that is not either the Company
or a Wholly Owned Restricted Subsidiary shall be deemed, in each case, to
constitute an incurrence of such Indebtedness by the Company or such
Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries
of Hedging Obligations that are incurred for the purpose of fixing or
hedging interest rate risk with respect to any floating rate Indebtedness
that is permitted by the terms of the Indenture to be outstanding;
(viii) the incurrence by the Company or any of its Restricted Subsidiaries
of Indebtedness (in addition to Indebtedness permitted by any other clause
of this paragraph) in an aggregate principal amount at any time outstanding
not to exceed $50.0 million less the amount of any Indebtedness incurred
pursuant to clause (i)(y) of this paragraph;
(ix) the incurrence by the Company or any of its Restricted Subsidiaries
of Acquired Indebtedness, PROVIDED that such Indebtedness (A) is not
incurred in contemplation of the acquisition to which it relates and (B) is
nonrecourse to the Company and its Restricted Subsidiaries, or to any of
their respective assets (other than the acquired Subsidiary and its
Subsidiaries, or the acquired assets, as applicable);
(x) the incurrence by the Company of Indebtedness pursuant to Exchange
Debentures described under clause (2) of the definition of Exchange
Debentures;
(xi) the Guarantee of any Indebtedness otherwise permitted to be
incurred pursuant to the Indenture; and
(xii) Obligations in respect of performance and surety bonds.
LIENS
The Indenture provides that the Company will not, and will not permit any of
its Restricted Subsidiaries to, directly or indirectly, create, incur, assume or
suffer to exist any Lien securing Pari Passu Indebtedness or Subordinated
Indebtedness on any asset now owned or hereafter acquired by the Company or any
of its Restricted Subsidiaries, or any income or profits therefrom, or assign or
convey any right to receive income therefrom; PROVIDED, however that the Company
and its Restricted Subsidiaries may create, incur, assume or suffer to exist a
Lien securing Pari Passu Indebtedness if the Notes are equally and ratably
secured with the obligations so secured until such time as such obligations are
no longer secured by a Lien.
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DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING RESTRICTED SUBSIDIARIES
The Indenture provides that the Company will not, and will not permit any of
its Restricted Subsidiaries to, directly or indirectly, create or otherwise
cause or suffer to exist or become effective any encumbrance or restriction on
the ability of any Restricted Subsidiary to:
(i)(a) pay dividends or make any other distributions to the Company or
any of its Restricted Subsidiaries on its Capital Stock or (b) pay any
indebtedness owed to the Company or any of its Restricted Subsidiaries;
(ii) make loans or advances to the Company or any of its Restricted
Subsidiaries; or
(iii) transfer any of its properties or assets to the Company or any of
its Restricted Subsidiaries, except (in each case) for such encumbrances or
restrictions existing under or by reason of:
(a) the Existing Indebtedness as in effect on the date of the
Indenture;
(b) the Senior Credit Facility, as in effect as of the date of the
Indenture, and any amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings thereof;
PROVIDED that such amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings are no
more restrictive in the aggregate than those contained in the Senior
Credit Facility, as in effect on the date of the Indenture;
(c) the Indenture, the Subsidiary Guarantees and the Notes;
(d) applicable law;
(e) any instrument governing Capital Stock or Indebtedness of any
Person acquired by the Company or any of its Restricted Subsidiaries, as
in effect at the time of such acquisition (except to the extent such
Indebtedness was incurred in connection with, or in contemplation of,
such acquisition), which encumbrance or restriction is not applicable to
any Person, or the properties or assets of any Person, other than the
Person, or the properties or assets of the Person, so acquired;
(f) customary non-assignment and subletting provisions in leases and
other contracts entered into in the ordinary course of business and
consistent with past practices;
(g) purchase money obligations for property acquired in the ordinary
course of business that impose restrictions of the nature described in
clause (iii) above on the property so acquired;
(h) Permitted Refinancing Indebtedness, PROVIDED that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive in the aggregate than
those contained in the agreements governing the Indebtedness being
refinanced;
(i) contractual encumbrances or restrictions in effect on the date of
the Indenture;
(j) mortgage or construction financing that imposes restrictions on
the real property acquired or improved;
(k) contracts for the sale of assets that include customary
restrictions concerning the disposition of property;
(l) secured indebtedness permitted by the Indenture that limits the
right to dispose of the assets securing the indebtedness; and
(m) encumbrances or restrictions imposed by any amendments to the
contracts, agreements or obligations referred to in clauses (a) through
(l) above if not more restrictive in the aggregate than under existing
contracts.
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ADDITIONAL GUARANTEES
The Indenture provides that if the Company or any of its Restricted
Subsidiaries shall, after the date of the Indenture, transfer or cause to be
transferred, in one transaction or a series of related transactions, any assets,
businesses, divisions, real property or equipment having an aggregate fair
market value (as determined in good faith by the Board of Directors) in excess
of $1.0 million to any Subsidiary that is not a Subsidiary Guarantor, or if the
Company or any of its Restricted Subsidiaries shall acquire another Subsidiary
having total assets with a fair market value (as determined in good faith by the
Board of Directors) in excess of $1.0 million, then such transferee or acquired
Subsidiary shall execute a Subsidiary Guarantee and a supplemental indenture and
deliver to the Trustee an opinion of counsel in accordance with the terms of the
Indenture. Notwithstanding the foregoing, if such transferee or acquired
Subsidiary has been properly designated as an Unrestricted Subsidiary in
accordance with the Indenture, then for so long as it continues to constitute an
Unrestricted Subsidiary that transferee or acquired Subsidiary shall not be
required to execute a Subsidiary Guarantee or deliver to the Trustee an opinion
of counsel in accordance with the terms of the Indenture.
MERGER, CONSOLIDATION, OR SALE OF ASSETS
The Indenture provides that the Company may not consolidate or merge with or
into (whether or not the Company is the surviving corporation), or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
properties or assets in one or more related transactions to, another Person
unless (i) the Company is the surviving corporation or the Person formed by or
surviving any such consolidation or merger (if other than the Company) or to
which such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made is a corporation organized or existing under the laws of
the United States, any state thereof, the District of Columbia or a territory
thereof; (ii) the Person formed by or surviving any such consolidation or merger
(if other than the Company) or the Person to which such sale, assignment,
transfer, lease, conveyance or other disposition shall have been made assumes
all the obligations of the Company under the Notes and the Indenture pursuant to
a supplemental indenture in a form reasonably satisfactory to the Trustee; (iii)
immediately after such transaction no Default or Event of Default exists; and
(iv) the Company or the Person formed by or surviving any such consolidation or
merger (if other than the Company), or to which such sale, assignment, transfer,
lease, conveyance or other disposition shall have been made will, at the time of
such transaction and after giving pro forma effect thereto as if such
transaction had occurred at the beginning of the applicable four-quarter period,
be permitted to incur at least $1.00 of additional Indebtedness pursuant to the
Fixed Charge Coverage Ratio test set forth in the covenant described above under
the caption "Certain Covenants--Incurrence of Indebtedness and Issuance of
Disqualified Stock." The foregoing will not prohibit any consolidation or merger
of, or transfer of all or part of the property and assets of, any Restricted
Subsidiary with or to the Company or any Subsidiary Guarantor.
TRANSACTIONS WITH AFFILIATES
The Indenture provides that the Company will not, and will not permit any of
its Restricted Subsidiaries to, sell, lease, transfer or otherwise dispose of
any of its properties or assets to, or purchase any property or assets from, or
enter into or make any contract, agreement, understanding, loan, advance or
Guarantee with, or for the benefit of, any Affiliate (each of the foregoing, an
"Affiliate Transaction"), unless (i) such Affiliate Transaction is on terms that
are no less favorable to the Company or the relevant Restricted Subsidiary than
those that would have been obtained in a comparable transaction by the Company
or such Restricted Subsidiary with an unrelated Person and (ii) the Company
delivers to the Trustee (a) with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate consideration in excess of
$1.0 million, a resolution of the Board of Directors set forth in an Officers'
Certificate certifying that such Affiliate Transaction or series of related
Affiliate Transactions complies with clause (i) above and that such Affiliate
Transaction or series of related Affiliate Transactions has been approved by a
majority of the disinterested members of the Board of Directors and (b) with
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respect to any Affiliate Transaction or series of related Affiliate Transactions
involving aggregate consideration in excess of $5.0 million (other than
Affiliate Transactions in the ordinary course of business of the Company and its
Restricted Subsidiaries between or among the Company or any Restricted
Subsidiary of the Company and any Person providing goods and/or services to the
Company or any Restricted Subsidiary in the ordinary course of business that is
an Affiliate of the Company or such Restricted Subsidiary solely by virtue of
the fact that the Fund, or any Person controlling the Fund, directly or
indirectly controls both the Company or such Restricted Subsidiary and such
Affiliate; PROVIDED, however, that such Affiliate Transaction shall comply with
clause (i) above), an opinion as to the fairness to the Company or such
Restricted Subsidiary of such Affiliate Transaction from a financial point of
view issued by an independent nationally recognized investment banking or
appraisal firm experienced in the appraisal or similar review of similar types
of transactions (or if an opinion is unavailable as to the fairness from a
financial point of view of any transaction for which a fairness opinion is not
customarily rendered then an opinion that such transaction meets the
requirements of clause (i) above); PROVIDED that (u) payments by Delchamps
pursuant to change of control agreements with certain employees of Delchamps in
an amount not to exceed $13.0 million, (v) payments to McCarty-Holman Co., L.P.
in accordance with the terms of the Management Agreement in an amount not to
exceed $100,000 in each fiscal year, (w) the 18 leases described elsewhere in
this Prospectus under the caption "Certain Transactions--Leases of Certain
Stores and Facilities," (x)(1) any employment agreement entered into by the
Company or any of its Restricted Subsidiaries and (2) payment of employee
benefits, including bonuses, retirement plans and stock options, in each case,
in the ordinary course of business and consistent with the past practice of the
Company or such Restricted Subsidiary, (y) transactions between or among the
Company and/or its Restricted Subsidiaries and (z) transactions permitted by the
provisions of the Indenture described above under the caption "Certain
Covenants--Restricted Payments," in each case, shall not be deemed Affiliate
Transactions.
SALE AND LEASEBACK TRANSACTIONS
The Indenture provides that the Company will not, and will not permit any of
its Restricted Subsidiaries to, enter into any sale and leaseback transaction
(other than the sale and leaseback of newly constructed grocery stores as part
of the development of grocery store sites); PROVIDED that the Company and its
Restricted Subsidiaries may enter into a sale and leaseback transaction if (i)
the Company or such Restricted Subsidiary could have (a) incurred Indebtedness
in an amount equal to the Attributable Debt relating to such sale and leaseback
transaction pursuant to the Fixed Charge Coverage Ratio test set forth in the
first paragraph of the covenant described above under the caption "Certain
Covenants--Incurrence of Additional Indebtedness and Issuance of Disqualified
Stock" and (b) incurred a Lien to secure such Indebtedness pursuant to the
covenant described above under the caption "Certain Covenants--Liens," (ii) the
gross cash proceeds of such sale and leaseback transaction are at least equal to
the fair market value (as determined in good faith by the Company's Board of
Directors and set forth in an Officers' Certificate delivered to the Trustee) of
the property that is the subject of such sale and leaseback transaction and
(iii) the transfer of assets in such sale and leaseback transaction is permitted
by, and the Company or such Restricted Subsidiary applies the proceeds of such
transaction in compliance with, the covenant described above under the caption
"Repurchase at Option of Holders--Asset Sales."
LIMITATION ON ISSUANCES AND SALES OF CAPITAL STOCK OF GUARANTORS
The Indenture provides that, except with respect to the pledge of Capital
Stock of its Subsidiaries pursuant to the Senior Credit Facility, the Company
(i) will not, and will not permit any Wholly Owned Restricted Subsidiary of the
Company to, transfer, convey, sell, lease or otherwise dispose of any Capital
Stock of any Subsidiary Guarantor to any Person (other than the Company or a
Wholly Owned Restricted Subsidiary of the Company that is a Subsidiary
Guarantor), unless (a) such transfer, conveyance, sale, lease or other
disposition is of all the Capital Stock of such Subsidiary Guarantor and (b) the
cash Net Proceeds from such transfer, conveyance, sale, lease or other
disposition are applied in accordance with the covenant described above under
the caption "Repurchase at Option of Holders--Asset Sales," and (ii) will not
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permit any Subsidiary Guarantor to issue any of its Equity Interests (other
than, if necessary, shares of its Capital Stock constituting directors'
qualifying shares) to any Person other than to the Company or another Subsidiary
Guarantor.
NO SENIOR SUBORDINATED DEBT
The Indenture provides that (i) the Company will not incur, create, issue,
assume, guarantee or otherwise become liable for any Indebtedness that is
subordinate or junior in right of payment to any Senior Debt and senior in any
respect in right of payment to the Notes, and (ii) no Subsidiary Guarantor will
incur, create, issue, assume, guarantee or otherwise become liable for any
Indebtedness that is subordinate or junior in right of payment to the Senior
Debt of such Subsidiary Guarantor and senior in any respect in right of payment
to the Subsidiary Guarantees. For purposes of this provision, no Indebtedness
shall be deemed to be subordinated in right of payment to any other Indebtedness
solely by reason of the fact that such other Indebtedness is secured by a Lien
or is subject to a Guarantee.
BUSINESS ACTIVITIES
The Company will not, and will not permit any Restricted Subsidiary to,
engage in any business other than (i) the retail and wholesale grocery business
and such business activities as are incidental or reasonably related thereto,
including the sale of liquor and the retail gasoline business, and (ii) such
other businesses as the Company or its Restricted Subsidiaries are engaged in on
the date of the Indenture.
NO RESTRICTIONS ON CONSUMMATION OF DELCHAMPS ACQUISITION
The Indenture provides that, notwithstanding any provision contained herein
to the contrary, the Indenture will not prohibit the consummation of the
Delchamps Acquisition and the transactions related thereto in accordance with
the terms set forth in this Prospectus and in the tender offer statement on
Schedule 14D-1, as filed with the Securities and Exchange Commission (the
"Commission") on July 14, 1997 and as subsequently amended or supplemented,
naming Delchamps, Inc. as the subject company.
REPORTS
The Indenture provides that so long as required to do so under the Exchange
Act, the Company shall file with the Commission and distribute to the Holders
copies of the quarterly and annual financial information required to be filed
with the Commission pursuant to the Exchange Act. All such financial information
shall include consolidated financial statements (including footnotes) prepared
in accordance with GAAP. Such annual financial information shall also include an
opinion thereon expressed by an independent accounting firm of established
national reputation. All such consolidated financial statements shall be
accompanied by a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" that describes the financial condition and results of
operations of the Company and its Restricted Subsidiaries. In addition, the
Indenture provides that, whether or not required by the rules and regulations of
the Commission, so long as any Notes are outstanding, the Company will furnish
to the Holders (i) all quarterly and annual financial information that would be
required to be contained in a filing with the Commission on Forms 10-Q and 10-K
if the Company were required to file such Forms, including a "Management's
Discussion and Analysis of Financial Condition and Results of Operations" that
complies with the rules and regulations of the Commission and that describes the
financial condition and results of operations of the Company and its Restricted
Subsidiaries and, with respect to the annual information only, a report thereon
by the Company's certified independent accountants and (ii) all current reports
that would be required to be filed with the Commission on Form 8-K if the
Company were required to file such reports. In addition, whether or not required
by the rules and regulations of the Commission, the Company will submit a copy
of all such information and reports to the Commission for public availability
(unless the Commission will not accept such materials) and make such information
available to prospective investors upon written request. In addition, the
Company has agreed that, during any period in which the Company is not subject
to the reporting requirements of the Exchange Act, it will
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furnish to holders and prospective purchasers of the Notes the information
required by Rule 144A(d)(4) under the Securities Act.
EVENTS OF DEFAULT AND REMEDIES
The Indenture provides that each of the following constitutes an Event of
Default: (i) default for 30 days in the payment when due, upon redemption,
acceleration or otherwise, of interest on, or Liquidated Damages with respect
to, the Notes; (ii) default in payment when due of the principal of or premium,
if any, on the Notes; (iii) failure by the Company for 30 days after receipt of
written notice from the Trustee or from Holders of at least 25% of the aggregate
principal amount of the Notes then outstanding to comply with the provisions
described under the captions "Repurchase at Option of Holders--Change of
Control" and "--Asset Sales," and under the captions "Certain
Covenants--Restricted Payments" and "-- Incurrence of Indebtedness and Issuance
of Disqualified Stock"; (iv) failure by the Company for 60 days after receipt of
written notice from the Trustee or from Holders of at least 25% of the aggregate
principal amount of the Notes then outstanding to comply with any of its other
agreements in the Indenture or the Notes; (v) default under any mortgage,
indenture or instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness for money borrowed by the Company or any
of its Restricted Subsidiaries or the payment of which is Guaranteed by the
Company or any of its Restricted Subsidiaries (other than Indebtedness owed to
the Company or its Restricted Subsidiaries) whether such Indebtedness or
Guarantee now exists, or is created after the date of the Indenture, if both (a)
such default either (1) results from the failure to pay any such Indebtedness at
its stated final maturity (after giving effect to any applicable grace periods)
or (2) relates to an obligation other than the obligation to pay principal of
any such Indebtedness at its stated maturity and results in the holder or
holders of such Indebtedness causing such Indebtedness to become due prior to
its stated maturity and (b) the principal amount of such Indebtedness, together
with the principal amount of any other such Indebtedness in default for failure
to pay principal at stated final maturity (after giving effect to any applicable
grace periods), or the maturity of which has been so accelerated, aggregate
$15.0 million or more; (vi) failure by the Company or any of its Restricted
Subsidiaries to pay final judgments (other than any judgments as to which a
reputable insurance company has accepted liability) aggregating in excess of
$15.0 million, which judgments are not paid, discharged, bonded or stayed for a
period of 60 days after their entry; (vii) except as permitted by the Indenture,
any Subsidiary Guarantee shall be held in any judicial proceeding to be
unenforceable or invalid or shall cease for any reason to be in full force and
effect or any Guarantor, or any Person acting on behalf of any Subsidiary
Guarantor, shall deny or disaffirm its obligations under its Subsidiary
Guarantee; and (viii) certain events of bankruptcy or insolvency with respect to
the Company, any of its Significant Restricted Subsidiaries or any group of
Restricted Subsidiaries that, taken together, would constitute a Significant
Restricted Subsidiary.
If any Event of Default occurs and is continuing, the Trustee or the Holders
of at least 25% in aggregate principal amount of the then outstanding Notes may
declare all the Notes to be due and payable immediately; PROVIDED, however,
that, so long as any Designated Senior Debt shall be outstanding, no such
acceleration shall be effective until the earlier of (i) acceleration of any
such Designated Senior Debt or (ii) five business days after the giving of
written notice to the Company and the representatives under the Designated
Senior Debt of such acceleration. Notwithstanding the foregoing, in the case of
an Event of Default arising from certain events of bankruptcy or insolvency with
respect to the Company, any Significant Restricted Subsidiary or any group of
Restricted Subsidiaries that, taken together, would constitute a Significant
Restricted Subsidiary, all outstanding Notes will become due and payable without
further action or notice. Holders of the Notes may not enforce the Indenture or
the Notes except as provided in the Indenture. In the event of any Event of
Default specified in clause (v) above, such Event of Default and all
consequences thereof (including, without limitation, any acceleration or
resulting payment default) shall be annulled, waived and rescinded,
automatically and without any action by the Trustee or the Holders of the Notes,
if within 20 days after such Event of Default arose (x) the Indebtedness or
guarantee that is the basis for such Event of Default has been discharged in a
manner that does not violate
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the terms of the Indenture or (y) the holders thereof have rescinded or waived
the acceleration, notice or action (as the case may be) giving rise to such
Event of Default. Subject to certain limitations, Holders of a majority in
principal amount of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders of the
Notes notice of any continuing Default or Event of Default (except a Default or
Event of Default relating to the payment of principal, interest or Liquidated
Damages) if it determines that withholding notice is in their interest. In
addition, the Trustee shall have no obligation to accelerate the Notes if, in
the best judgment of the Trustee, acceleration is not in the best interests of
the Holders.
In the case of any Event of Default occurring by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of the Company with
the intention of avoiding payment of the premium that the Company would have had
to pay if the Company then had elected to redeem the Notes pursuant to the
optional redemption provisions of the Indenture, an equivalent premium shall
also become and be immediately due and payable to the extent permitted by law
upon the acceleration of the Notes. If an Event of Default occurs prior to
September 15, 2002 by reason of any willful action (or inaction) taken (or not
taken) by or on behalf of the Company with the intention of avoiding the
prohibition on redemption of the Notes prior to September 15, 2002, then the
premium specified in the Indenture shall also become immediately due and payable
to the extent permitted by law upon the acceleration of the Notes.
The Holders of a majority in aggregate principal amount of the Notes then
outstanding by notice to the Trustee may on behalf of the Holders of all of the
Notes waive any existing Default or Event of Default and its consequences under
the Indenture except a continuing Default or Event of Default in the payment of
interest on, or Liquidated Damages with respect to, or the principal of, any
such Note held by a non-consenting Holder.
The Company is required to deliver to the Trustee annually a statement
regarding compliance with the Indenture, and the Company is required upon
becoming aware of any Default or Event of Default, to deliver to the Trustee a
statement specifying such Default or Event of Default.
NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND STOCKHOLDERS
No director, officer, employee, incorporator or stockholder of the Company
or any Subsidiary Guarantor, as such, shall have any liability for any
obligations of the Company under the Notes, any Subsidiary Guarantee or the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes and the Subsidiary Guarantees. Such
waiver may not be effective to waive liabilities under the federal securities
laws and it is the view of the Commission that such a waiver is against public
policy.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
The Company may, at its option and at any time, elect to have all
obligations of the Company and the Subsidiary Guarantors discharged with respect
to the outstanding Notes and the Subsidiary Guarantees ("Legal Defeasance")
except for (i) the rights of Holders of outstanding Notes to receive payments in
respect of the principal of, premium, if any, and interest and Liquidated
Damages, if any, on such Notes when such payments are due from the trust
referred to below, (ii) the Company's obligations with respect to the Notes
concerning issuing temporary Notes, registration of Notes, mutilated, destroyed,
lost or stolen Notes and the maintenance of an office or agency for payment and
money for security payments held in trust, (iii) the rights, powers, trusts,
duties and immunities of the Trustee, and the Company's obligations in
connection therewith and (iv) the Legal Defeasance provisions of the Indenture.
In addition, the Company may, at its option and at any time, elect to have the
obligations of the Company and the Subsidiary Guarantors released with respect
to certain covenants that are described in the Indenture ("Covenant Defeasance")
and thereafter any omission to comply with such obligations shall not constitute
a Default or Event of Default with respect to the Notes. In the event Covenant
Defeasance occurs, certain events (not
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including non-payment, bankruptcy, receivership, rehabilitation and insolvency
events) described under "Events of Default" will no longer constitute an Event
of Default with respect to the Notes.
In order to exercise either Legal Defeasance or Covenant Defeasance, (i) the
Company must irrevocably deposit with the Trustee, in trust, for the benefit of
the Holders of the Notes, cash in U.S. dollars, non-callable Government
Securities, or a combination thereof, in such amounts as will be sufficient, in
the opinion of a nationally recognized firm of independent public accountants,
to pay the principal of, premium, if any, and interest and Liquidated Damages,
if any, on the outstanding Notes on the stated maturity date or on the
applicable redemption date, as the case may be, and the Company must specify
whether the Notes are being defeased to maturity or to a particular redemption
date; (ii) in the case of Legal Defeasance, the Company shall have delivered to
the Trustee an opinion of counsel in the United States reasonably acceptable to
the Trustee confirming that (A) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling or (B) since the date of the
Indenture, there has been a change in the applicable federal income tax law, in
either case to the effect that, and based thereon such opinion of counsel shall
confirm that, subject to customary assumptions and exclusions, the Holders of
the outstanding Notes will not recognize income, gain or loss for federal income
tax purposes as a result of such Legal Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such Legal Defeasance had not occurred; (iii) in the
case of Covenant Defeasance, the Company shall have delivered to the Trustee an
opinion of counsel in the United States reasonably acceptable to the Trustee
confirming that, subject to customary assumptions and exclusions, the Holders of
the outstanding Notes will not recognize income, gain or loss for federal income
tax purposes as a result of such Covenant Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Covenant Defeasance had not occurred; (iv)
no Default or Event of Default shall have occurred and be continuing on the date
of such deposit (other than a Default or Event of Default resulting from the
borrowing of funds to be applied to such deposit) or insofar as Events of
Default from bankruptcy or insolvency events are concerned, at any time in the
period ending on the 91st day after the date of deposit; (v) such Legal
Defeasance or Covenant Defeasance will not result in a breach or violation of,
or constitute a default under any material agreement or instrument (other than
the Indenture) to which the Company or any of the Subsidiary Guarantors is a
party or by which the Company or any of the Subsidiary Guarantors is bound; (vi)
on or prior to the 91st day following the deposit, the Company must have
delivered to the Trustee an opinion of counsel to the effect that, subject to
customary assumptions and exclusions, after the 91st day following the deposit,
the trust funds will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally; (vii) the Company must have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders over any other creditors of the Company or with the
intent of defeating, hindering, delaying or defrauding any other creditors of
the Company; and (viii) the Company must have delivered to the Trustee an
Officers' Certificate and an opinion of counsel, each stating that, subject to
customary assumptions and exclusions, all conditions precedent provided for in
the Indenture relating to the Legal Defeasance or the Covenant Defeasance have
been complied with.
TRANSFER AND EXCHANGE
A Holder may transfer or exchange Notes in accordance with the Indenture.
The Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and the Company may require a Holder to pay
any taxes and fees required by law or permitted by the Indenture. The Registrar
is not required to transfer or exchange any Note selected for redemption. Also,
the Registrar is not required to transfer or exchange any Note for a period of
15 days before a selection of Notes to be redeemed.
The registered Holder of a Note will be treated as the owner of it for all
purposes.
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AMENDMENT, SUPPLEMENT AND WAIVER
Except as provided in the next two succeeding paragraphs, the Indenture, the
Subsidiary Guarantees or the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount of the Notes
then outstanding (including consents obtained in connection with a tender offer
or exchange offer for Notes), and any existing default or compliance with any
provision of the Indenture, the Subsidiary Guarantees or the Notes may be waived
with the consent of the Holders of a majority in principal amount of the then
outstanding Notes (including consents obtained in connection with a tender offer
or exchange offer for Notes).
Without the consent of each Holder affected, an amendment or waiver may not
(with respect to any Notes held by a non-consenting Holder): (i) reduce the
principal amount of Notes whose Holders must consent to an amendment, supplement
or waiver, (ii) reduce the principal of or change the fixed maturity of any Note
or alter the provisions with respect to the redemption of the Notes (other than
provisions relating to the covenants described above under the caption
"--Repurchase at the Option of Holders"), (iii) reduce the rate of or change the
time for payment of interest or Liquidated Damages on any Note, (iv) waive a
Default or Event of Default in the payment of principal of or premium, if any,
or interest or Liquidated Damages on the Notes (except a rescission of
acceleration of the Notes by the Holders of at least a majority in aggregate
principal amount of the Notes and a waiver of the payment default that resulted
from such acceleration), (v) make any Note payable in money other than that
stated in the Notes, (vi) make any change in the provisions of the Indenture
relating to waivers of past Defaults or the rights of Holders to receive
payments of principal of or premium, if any, or interest on the Notes, (vii)
waive a redemption payment with respect to any Note (other than a payment
required by one of the covenants described above under the caption "--Repurchase
at the Option of Holders") or (viii) make any change in the foregoing amendment
and waiver provisions. In addition, any amendment to the subordination
provisions of the Indenture will require the consent of the Holders of at least
75% in aggregate principal amount of the Notes then outstanding if such
amendment would adversely affect the legal rights of Holders.
Notwithstanding the foregoing, without the consent of any Holder, the
Company, the Subsidiary Guarantors and the Trustee may amend or supplement the
Indenture, the Subsidiary Guarantees or the Notes to cure any ambiguity, defect
or inconsistency, to provide for uncertificated Notes in addition to or in place
of certificated Notes, to provide for the assumption of the Company's
obligations to Holders in the case of a merger, consolidation or sale of assets
in accordance with the terms of the Indenture, to make any change that would
provide any additional rights or benefits to the Holders or that does not
adversely affect the legal rights under the Indenture of any such Holder, or to
comply with requirements of the Commission in order to effect or maintain the
qualification of the Indenture under the Trust Indenture Act.
The consent of the Holders is not necessary under the Indenture to approve
the particular form of any proposed amendment. It is sufficient if such consent
approves the substance of the proposed amendment.
GOVERNING LAW
The Indenture, the Subsidiary Guarantees and the Notes are, subject to
certain exceptions, governed by and construed in accordance with the internal
laws of the State of New York, without regard to the choice of law rules
thereof.
CONCERNING THE TRUSTEE
The Indenture contains certain limitations on the rights of the Trustee,
should it become a creditor of the Company, to obtain payment of claims in
certain cases, or to realize on certain property received in respect of any such
claim as security or otherwise. The Trustee is permitted to engage in other
transactions; however, if it acquires any conflicting interest it must eliminate
such conflict within 90 days, apply to the Commission for permission to continue
or resign.
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The Holders of a majority in principal amount of the then outstanding Notes
have the right to direct the time, method and place of conducting any proceeding
for exercising any remedy available to the Trustee, subject to certain
exceptions. The Indenture provides that in case an Event of Default shall occur
(which shall not be cured), the Trustee will be required, in the exercise of its
power, to use the degree of care of a prudent man in the conduct of his own
affairs. Subject to such provisions, the Trustee is under no obligation to
exercise any of its rights or powers under the Indenture at the request of any
Holder of Notes, unless such Holder shall have offered to the Trustee security
and indemnity satisfactory to it against any loss, liability or expense.
CERTAIN DEFINITIONS
Set forth below are certain defined terms used in the Indenture. Reference
is made to the Indenture for a full disclosure of all such terms, as well as any
other capitalized terms used herein for which no definition is provided.
"1996 MERGER" means the transactions contemplated by the 1996 Merger
Agreement.
"1996 MERGER AGREEMENT" means the Merger Agreement and Plan of Exchange and
Merger, dated as of November 16, 1995, by and among BRS No. 1, Inc. (renamed JJ
Acquisitions Corp.) and Jitney-Jungle Stores of America, Inc., Southern Jitney
Jungle Company, McCarty-Holman Co., Inc. and Jitney-Jungle Bakery, Inc., as
amended.
"ACQUIRED INDEBTEDNESS" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Restricted Subsidiary of such specified Person
and (ii) Indebtedness secured by a Lien encumbering any asset acquired by such
specified Person.
"AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; PROVIDED that
beneficial ownership of 10% or more of the voting securities of a Person shall
be deemed to be control. Notwithstanding the foregoing, in no event will the
holders of Indebtedness under or in respect of the Senior Credit Facility (by
reason of holding such Indebtedness) or Donaldson, Lufkin & Jenrette Securities
Corporation or any of their respective Affiliates be deemed Affiliates of the
Company or any of its Affiliates.
"ASSET SALE" means: (i) the sale, conveyance, transfer or other disposition
of any assets (including, without limitation, by way of a sale and leaseback)
other than sales of inventory in the ordinary course of business (provided that
the sale, conveyance, transfer or other disposition of all or substantially all
of the assets of the Company and its Restricted Subsidiaries taken as a whole
will be governed by the provisions of the Indenture described above under the
caption "Repurchase at Option of Holders--Change of Control" and/or the
provisions described above under the caption "Merger, Consolidation or Sale of
Assets" and not by the provisions of the Asset Sale covenant) or (ii) the
issuance or sale by the Company or any of its Restricted Subsidiaries of Equity
Interests of any of the Company's Restricted Subsidiaries, in the case of
clauses (i) and (ii) above, whether in a single transaction or a series of
related transactions for net proceeds in excess of $1.0 million. Notwithstanding
the foregoing: (i) a sale, conveyance, transfer or other disposition of assets
by the Company to a Wholly Owned Restricted Subsidiary or by a Wholly Owned
Restricted Subsidiary to the Company or to another Wholly Owned Restricted
Subsidiary; (ii) an issuance of Equity Interests by a Wholly Owned Restricted
Subsidiary to the Company or to another Wholly Owned Restricted Subsidiary and
(iii) a Restricted Payment that is permitted by the covenant described above
under the caption "Certain Covenants--Restricted Payments," in each case, shall
not be deemed to be Asset Sales.
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"ATTRIBUTABLE DEBT" means, in respect of a sale and leaseback transaction,
at the time of determination, the present value (discounted at the rate of
interest implicit in such transaction, determined in accordance with GAAP) of
the obligation of the lessee for net rental payments during the remaining term
of the lease included in such sale and leaseback transaction (including any
period for which such lease has been extended or may, at the option of the
lessor, be extended).
"BRS MANAGEMENT AGREEMENT" means that certain management agreement, dated
September 8, 1995 between BRS and the Company, as amended on February 29, 1996
and on the date of the Indenture, and as it may be further amended from time to
time.
"BORROWING BASE" means 60% of the net book value of all inventory of the
Company and its Restricted Subsidiaries.
"CAPITAL LEASE OBLIGATION" means, at the time any determination thereof is
to be made, the amount of the liability in respect of a capital lease that would
at such time be required to be capitalized on a balance sheet in accordance with
GAAP.
"CAPITAL STOCK" means (i) in the case of a corporation, corporate stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
corporate stock, (iii) in the case of a partnership, partnership interests
(whether general or limited) and (iv) any other interest or participation that
confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, the issuing Person.
"CASH EQUIVALENTS" means (i) United States dollars, (ii) securities issued
or directly and fully guaranteed or insured by the United States government or
any agency or instrumentality thereof having maturities of not more than one
year from the date of acquisition, (iii) certificates of deposit and eurodollar
time deposits with maturities of one year or less from the date of acquisition,
bankers' acceptances with maturities not exceeding one year and overnight bank
deposits, in each case with any lender party to the Senior Credit Facility or
with any domestic commercial bank having capital and surplus in excess of $500
million and a Keefe Bank Watch Rating of "B" or better, (iv) repurchase
obligations with a term of not more than seven days for underlying securities of
the types described in clauses (ii) and (iii) above entered into with any
financial institution meeting the qualifications specified in clause (iii) above
and (v) commercial paper having the highest rating obtainable from Moody's
Investors Service, Inc. or Standard & Poor's Corporation and in each case
maturing within one year after the date of acquisition.
"CLASS A PREFERRED STOCK" means the Class A Senior Exchangeable Preferred
Stock, par value $0.01 per share, of the Company.
"CLASS B PREFERRED STOCK" means the Class B Compounding Cumulative
Redeemable Preferred Stock, par value $0.01 per share, of the Company.
"CLASS C PREFERRED STOCK" means the Class C Compounding Cumulative Preferred
Stock, Series 1 and Series 2, par value $0.01 per share, of the Company.
"CONSOLIDATED NET INCOME" means, with respect to any Person for any period,
the aggregate of the Net Income of such Person and its Restricted Subsidiaries
for such period, on a consolidated basis, determined in accordance with GAAP;
PROVIDED that (i) the Net Income (but not loss) of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity method of
accounting shall be included to the extent of the amount of dividends or
distributions paid in cash (or converted into cash) to the referent Person or a
Wholly Owned Restricted Subsidiary thereof that is a Subsidiary Guarantor, (ii)
the Net Income of any Restricted Subsidiary shall be excluded to the extent that
the declaration or payment of dividends or similar distributions by that
Restricted Subsidiary of that Net Income is not at the date of determination
permitted without any prior governmental approval (which has not been obtained)
or, directly or indirectly, by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Restricted Subsidiary or its
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stockholders, (iii) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition shall
be excluded and (iv) the cumulative effect of a change in accounting principles
shall be excluded.
"DEFAULT" means any event that is or with the passage of time or the giving
of notice or both would become an Event of Default.
"DELCHAMPS ACQUISITION" means the Delchamps Merger and the Delchamps Tender
Offer.
"DELCHAMPS MERGER" means the merger contemplated by the Delchamps Merger
Agreement.
"DELCHAMPS MERGER AGREEMENT" means the Agreement and Plan of Merger, dated
July 8, 1997, by and among the Company, Delta Acquisition Corporation and
Delchamps, Inc.
"DELCHAMPS TENDER OFFER" means the tender offer contemplated by the
Delchamps Merger Agreement.
"DESIGNATED SENIOR DEBT" means (i) for so long as any Indebtedness is
outstanding under the Senior Credit Facility or the Senior Notes, any such
Indebtedness, and (ii) any other Senior Debt permitted under the Indenture the
principal amount of which is $25.0 million or more and that has been designated
by the Company as "Designated Senior Debt."
"DISQUALIFIED STOCK" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the holder thereof, in whole or in part, on or prior to the date
on which the Notes mature.
"EBITDA" means, with respect to any Person for any period, the Consolidated
Net Income of such Person for such period plus (i) an amount equal to any
extraordinary or non-recurring loss plus any net loss realized in connection
with (a) any Asset Sale (including, without limitation, dispositions pursuant to
sale and leaseback transactions) or (b) the dispositions of any securities by
such Person or any of its Restricted Subsidiaries or the extinguishment of any
Indebtedness of such Person or any of its Restricted Subsidiaries (in the case
of clauses (a) and (b) above, to the extent such losses were deducted in
computing such Consolidated Net Income), plus (ii) provision for taxes based on
income or profits of such Person and its Restricted Subsidiaries for such
period, to the extent that such provision for taxes was included in computing
such Consolidated Net Income, plus (iii) consolidated interest expense of such
Person and its Restricted Subsidiaries for such period, whether paid or accrued
and whether or not capitalized (including, without limitation, amortization of
original issue discount, non- cash interest payments, the interest component of
any deferred payment obligations, the interest component of all payments
associated with Capital Lease Obligations, commissions, discounts and other fees
and charges incurred in respect of letter of credit or bankers' acceptance
financing, and net payments (if any) pursuant to Hedging Obligations), to the
extent that any such expense was deducted in computing such Consolidated Net
Income, plus (iv) non-cash LIFO charges (credits) of such person and its
Restricted Subsidiaries for such period, plus (v) depreciation, amortization
(including amortization of goodwill and other intangibles but excluding
amortization of prepaid cash expenses that were paid in a prior period) and
other non-cash charges (excluding any such non-cash charge to the extent that it
represents an accrual of or reserve for cash charges in any future period or
amortization of a prepaid cash expense that was paid in a prior period) of such
Person and its Restricted Subsidiaries for such period to the extent that such
depreciation, amortization and other non-cash charges were deducted in computing
such Consolidated Net Income, plus (vi) non-recurring severance and transaction
costs incurred in connection with any acquisition, in each case, on a
consolidated basis and determined in accordance with GAAP. Notwithstanding the
foregoing, the provision for taxes on the income or profits of, and the
depreciation and amortization and other non-cash charges of, a Restricted
Subsidiary of the referent Person shall be added to Consolidated Net Income to
compute EBITDA only to the extent (and in the same proportion) that the Net
Income of such Restricted Subsidiary was included in calculating the
Consolidated Net Income of such Person.
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"EQUITY INTERESTS" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"EXCHANGE DEBENTURES" means the Company's Class A Exchange Debentures due
2008 issuable (1) in exchange for outstanding shares of Class A Preferred Stock
at the Company's option on the date of any scheduled dividend payment with
respect to the Class A Preferred Stock and (2) as payment of interest with
respect to outstanding Class A Exchange Debentures due 2008, in each case,
pursuant to the indenture related thereto in the form as in effect on the date
of the Indenture.
"EXISTING INDEBTEDNESS" means (i) up to $75.0 million of Indebtedness under
Capital Lease Obligations of the Company and its Restricted Subsidiaries in
existence on the date of the Indenture, (ii) up to $200.0 million in aggregate
principal amount of Indebtedness of the Company and its Restricted Subsidiaries
under the Senior Notes, (iii) up to $13.0 million in aggregate principal amount
of other Indebtedness of the Company and its Restricted Subsidiaries (excluding
Indebtedness under the Senior Credit Facility) in existence on the date of the
Indenture until such amounts are repaid and (iv) up to $16.0 million of Acquired
Indebtedness in connection with the Delchamps Acquisition.
"FIXED CHARGES" means, with respect to any Person for any period, the sum of
(i) the consolidated interest expense of such Person and its Restricted
Subsidiaries for such period, whether paid or accrued, to the extent such
expense was included in computing Consolidated Net Income (including, without
limitation, amortization of original issue discount, non-cash interest payments,
the interest component of any deferred payment obligations, the interest
component of all payments associated with Capital Lease Obligations, imputed
interest with respect to Attributable Debt, commissions, discounts and other
fees and charges incurred in respect of letter of credit or bankers' acceptance
financing, and net payments (if any) pursuant to Hedging Obligations), (ii) the
consolidated interest expense of such Person and its Restricted Subsidiaries
that was capitalized during such period, (iii) any interest expense on
Indebtedness of another Person that is Guaranteed by such Person or one of its
Restricted Subsidiaries or secured by a Lien on assets of such Person or one of
its Restricted Subsidiaries (whether or not such Guarantee or Lien is called
upon) and (iv) the product of (a) all dividend payments, whether or not in cash
(other than dividend payments to the Company or any Restricted Subsidiary and
other than dividend payments on Equity Interests of the Company and its
Restricted Subsidiaries that are paid solely in additional shares, or by
accretion to the liquidation preference, of such Equity Interests) on any series
of preferred stock of such Person and its Restricted Subsidiaries, times (b) a
fraction, the numerator of which is one and the denominator of which is one
minus the then current combined federal, state and local statutory tax rate of
such Person and its Restricted Subsidiaries, expressed as a decimal, in each
case, on a consolidated basis and in accordance with GAAP.
"FIXED CHARGE COVERAGE RATIO" means with respect to any Person for any
period, the ratio of the EBITDA of such Person and its Restricted Subsidiaries
for such period to the Fixed Charges of such Person and its Restricted
Subsidiaries for such period. In the event that the Company or any of its
Restricted Subsidiaries incurs, assumes, Guarantees or redeems any Indebtedness
(other than revolving credit borrowings) or issues preferred stock subsequent to
the commencement of the period for which the Fixed Charge Coverage Ratio is
being calculated but prior to the date on which the event for which the
calculation of the Fixed Charge Coverage Ratio is made (the "Calculation Date"),
then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect
to such incurrence, assumption, Guarantee or redemption of Indebtedness, or such
issuance or redemption of preferred stock, as if the same had occurred at the
beginning of the applicable four-quarter reference period. For purposes of
making the computation referred to above, (i) acquisitions that have been made
by the Company or any of its Restricted Subsidiaries, including through mergers
or consolidations and including any related financing transactions, during the
four-quarter reference period or subsequent to such reference period and on or
prior to the Calculation Date shall be deemed to have occurred on the first day
of the four-quarter reference period, and (ii) the EBITDA attributable to
discontinued operations, as determined in accordance with GAAP, and operations
or businesses disposed of prior to the Calculation Date, shall be
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excluded, and (iii) the Fixed Charges attributable to discontinued operations,
as determined in accordance with GAAP, and operations or businesses disposed of
prior to the Calculation Date, shall be excluded, but only to the extent that
the obligations giving rise to such Fixed Charges will not be obligations of the
referent Person or any of its Restricted Subsidiaries following the Calculation
Date.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the date of the Indenture.
"GUARANTEE" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"HEDGING OBLIGATIONS" means, with respect to any Person, the obligations of
such Person under (i) interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements and (ii) other agreements or
arrangements designed to protect such Person against fluctuations in interest
rates.
"INDEBTEDNESS" means, with respect to any Person and without duplication,
any indebtedness of such Person, whether or not contingent, in respect of
borrowed money or evidenced by bonds, notes, debentures or similar instruments
or letters of credit (or reimbursement agreements in respect thereof) or
banker's acceptances or representing Capital Lease Obligations or the balance
deferred and unpaid of the purchase price of any property or representing any
Hedging Obligations, except any such balance that constitutes an accrued expense
or trade payable, if and to the extent any of the foregoing indebtedness (other
than letters of credit and Hedging Obligations) would appear as a liability upon
a balance sheet of such Person prepared in accordance with GAAP, as well as all
indebtedness of others secured by a Lien on any asset of such Person (whether or
not such indebtedness is assumed by such Person) and, to the extent not
otherwise included, the Guarantee by such Person of any indebtedness of any
other Person.
"INVESTMENTS" means, with respect to any Person, all investments by such
Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including Guarantees), advances or capital contributions
(excluding commission, travel and similar advances to officers and employees
made in the ordinary course of business), purchases or other acquisitions for
consideration of Indebtedness, Equity Interests or other securities and all
other items that are or would be classified as investments on a balance sheet
prepared in accordance with GAAP; PROVIDED that an acquisition of assets, Equity
Interests or other securities by the Company for consideration consisting of
common equity securities of the Company shall not be deemed to be an Investment.
"IRB INDEBTEDNESS" means that certain Indebtedness of McCarty-Holman Co.,
Inc. pursuant to the Industrial Revenue Bond Issue with the City of Jackson,
Mississippi, dated December 1, 1985, evidenced by the Lease recorded in Book
3166 at Page 443 of the Land Records of Hinds County, First Judicial District,
Mississippi, including all agreements and documents related thereto.
"LIEN" means, with respect to any asset, any mortgage, lien, pledge, charge,
security interest or encumbrance of any kind in respect of such asset, whether
or not filed, recorded or otherwise perfected under applicable law (including
any conditional sale or other title retention agreement, any lease in the nature
thereof, any option or other agreement to sell or give a security interest in
and any filing of or agreement to give any financing statement (other than with
respect to a lease that does not create a Capital Lease Obligation) under the
Uniform Commercial Code (or equivalent statutes) of any jurisdiction).
"MANAGEMENT AGREEMENT" means that certain Management Agreement, dated March
19, 1980, between McCarty-Holman Co., L.P. and the Company, concerning the
management of leased properties.
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"NET INCOME" means, with respect to any Person, the net income (loss) of
such Person and its Restricted Subsidiaries, determined in accordance with GAAP
and before any reduction in respect of preferred stock dividends, excluding,
however, (i) any gain (but not loss), together with any related provision for
taxes on such gain (but not loss), realized in connection with (a) any Asset
Sale (including, without limitation, dispositions pursuant to sale and leaseback
transactions) or (b) the disposition of any securities by such Person or any of
its Restricted Subsidiaries or the extinguishment of any Indebtedness of such
Person or any of its Restricted Subsidiaries and (ii) any extraordinary or
nonrecurring gain (but not loss), together with any related provision for taxes
on such extraordinary or nonrecurring gain (but not loss).
"NET PROCEEDS" means the aggregate cash proceeds received by the Company or
any of its Restricted Subsidiaries in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale), net of the direct costs
relating to such Asset Sale (including, without limitation, legal, accounting
and investment banking fees, and sales commissions) and any relocation expenses
incurred as a result thereof, taxes paid or payable as a result thereof (after
taking into account any available tax credits or deductions and any tax sharing
arrangements), amounts required to be applied to the repayment of Indebtedness
(other than Indebtedness described in clause (i) of the second paragraph under
"--Asset Sales") secured by a Lien on the asset or assets that were the subject
of such Asset Sale and any reserve for adjustment in respect of the sale price
of such asset or assets established in accordance with GAAP.
"NON-RECOURSE DEBT" means Indebtedness (i) as to which neither the Company
nor any of its Restricted Subsidiaries (a) provides credit support of any kind
(including any undertaking, agreement or instrument that would constitute
Indebtedness) and (b) is directly or indirectly liable (as a guarantor or
otherwise); and (ii) no default with respect to which (including any rights that
the holders thereof may have to take enforcement action against an Unrestricted
Subsidiary) would permit (upon notice, lapse of time or both) any holder of any
other Indebtedness of the Company or any of its Restricted Subsidiaries to
declare a default on such other Indebtedness or cause the payment thereof to be
accelerated or payable prior to its stated maturity; and (iii) as to which the
lenders have been notified in writing that they will not have any recourse to
the stock or assets of the Company or any of its Restricted Subsidiaries.
"OBLIGATIONS" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"PARI PASSU INDEBTEDNESS" means Indebtedness of the Company or any of its
Restricted Subsidiaries that ranks PARI PASSU in right of payment to the Notes
or any Guarantee thereof.
"PERMITTED INVESTMENTS" means (a) any Investments in the Company or in a
Restricted Subsidiary of the Company that is a Subsidiary Guarantor; (b) any
Investments in Cash Equivalents; (c) Investments by the Company or any
Restricted Subsidiary of the Company in a Person, if as a result of such
Investment (i) such Person becomes a Restricted Subsidiary of the Company and a
Subsidiary Guarantor or (ii) such Person is merged, consolidated or amalgamated
with or into, or transfers or conveys substantially all of its assets to, or is
liquidated into, the Company or a Restricted Subsidiary of the Company that is a
Subsidiary Guarantor; (d) Restricted Investments made as a result of the receipt
of non-cash consideration from an Asset Sale that was made pursuant to and in
compliance with the covenant described above under the caption "Repurchase at
the Option of Holders--Asset Sales"; and (e) other Investments in any Person
that do not exceed $1.5 million at any time outstanding.
"PERMITTED JUNIOR SECURITIES" means Equity Interests in the Company and debt
securities of the Company or any Subsidiary Guarantor that are subordinated to
all Senior Debt (and any debt securities issued in exchange for Senior Debt of
the Company or such Subsidiary Guarantor) to substantially the same extent as,
or to a greater extent than, the Notes or Subsidiary Guarantees, as applicable,
are subordinated to Senior Debt pursuant to the subordination provisions of the
Indenture.
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"PERMITTED REFINANCING INDEBTEDNESS" means any Indebtedness of the Company
or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Company or any of its Restricted Subsidiaries
that is permitted to be incurred by the provisions of the Indenture; PROVIDED,
that, except with respect to Capital Lease Obligations, (i) the principal amount
(or accreted value, as applicable) of, or (with respect to revolving credit
Indebtedness) maximum commitment under, such Permitted Refinancing Indebtedness
does not exceed the principal amount (or accreted value, as applicable) of, or
(with respect to revolving credit Indebtedness) maximum commitment under, the
Indebtedness so extended, refinanced, renewed, replaced, defeased or refunded
(plus the amount of premiums and reasonable expenses incurred in connection
therewith); (ii) such Permitted Refinancing Indebtedness has a final maturity
date later than the final maturity date of, and (other than with respect to
revolving credit Indebtedness) has a Weighted Average Life to Maturity equal to
or greater than the Weighted Average Life to Maturity of, the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; (iii) if the
Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded
is subordinated in right of payment to the Notes, such Permitted Refinancing
Indebtedness has a final maturity date later than the final maturity date of,
and is subordinated in right of payment to, the Notes on terms at least as
favorable to the Holders as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; and (iv) such Indebtedness is incurred either by the Company and/or by
a Subsidiary Guarantor.
"PERSON" means an individual, corporation, partnership, limited liability
company, association, trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"PREFERRED STOCK" means the Class A Preferred Stock, the Class B Preferred
Stock and the Class C Preferred Stock.
"PUBLIC EQUITY OFFERING" means a public offering of common stock of the
Company.
"RESTRICTED INVESTMENT" means an Investment other than a Permitted
Investment.
"RESTRICTED SUBSIDIARY" of a Person means any Subsidiary of the referent
Person that is not an Unrestricted Subsidiary.
"SENIOR CREDIT FACILITY" means that certain revolving credit agreement,
dated as of March 5, 1996, as amended and restated on or prior to the date of
the Indenture, by and among the Company, each of the Subsidiary Guarantors and
the lenders named therein, and Fleet Capital Corporation, as successor agent to
Fleet Bank, N.A., including any related notes, guarantees, collateral documents,
instruments and agreements executed in connection therewith, as it may from time
to time be amended, renewed, supplemented or otherwise modified at the option of
the parties thereto and any other agreement pursuant to which any of the
Indebtedness, commitments, Obligations, costs, expenses, fees, reimbursements
and other indemnities payable or owing thereunder may be refinanced,
restructured, renewed, extended, increased, replaced or refunded, as any such
other agreements may from time to time at the option of the parties thereto be
amended, supplemented, renewed or otherwise modified, in each case, whether or
not with the same group of lenders.
"SENIOR DEBT" means (i) Indebtedness pursuant to the Senior Credit Facility,
(ii) Indebtedness pursuant to the Senior Notes or guarantees thereof, as
applicable, (iii) the IRB Indebtedness, (iv) any other Indebtedness permitted to
be incurred by the Company or a Restricted Subsidiary under the terms of the
Indenture, unless the instrument under which such Indebtedness is incurred
expressly provides that it is on a parity with or subordinated in right of
payment to the Notes or the Subsidiary Guarantees, as applicable, and (v) all
Obligations with respect to the foregoing. Notwithstanding anything to the
contrary in the foregoing, Senior Debt will not include (w) any liability for
federal, state, local or other taxes owed or owing by the Company or any
Subsidiary Guarantor, (x) any Indebtedness of the Company or any
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Subsidiary Guarantor to any of their respective Subsidiaries or other
Affiliates, (y) any trade payables or (z) any Indebtedness that is incurred in
violation of the Indenture.
"SENIOR NOTES" means the 12% Senior Notes of the Company due 2006.
"SIGNIFICANT RESTRICTED SUBSIDIARY" means any Restricted Subsidiary that
would be a "significant subsidiary" as defined in Article 1, Rule 1-02 of
Regulation S-X, promulgated pursuant to the Act, as such Regulation is in effect
on the date hereof.
"SUBORDINATED INDEBTEDNESS" means any Indebtedness of the Company or any of
its Restricted Subsidiaries which is by its terms expressly subordinated in
right of payment to the Notes, any Subsidiary Guarantee or any other
Indebtedness that is subordinated in right of payment to the Notes or any
Subsidiary Guarantee.
"SUBSIDIARY" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a combination
thereof) and (ii) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or (b)
the only general partners of which are such Person or of one or more
Subsidiaries of such Person (or any combination thereof).
"SUBSIDIARY GUARANTORS" means each of (i) Interstate Jitney-Jungle Stores,
Inc., an Alabama corporation; (b) McCarty-Holman Co., Inc., a Mississippi
corporation; (c) Southern Jitney Jungle Company, a Mississippi Corporation; (d)
Pump And Save, Inc., a Mississippi corporation; (e) DAC; (f) SCSI and (g)
Delchamps and (ii) any other Subsidiary that executes a Subsidiary Guarantee in
accordance with the provisions of the Indenture, and their respective successors
and assigns.
"UNRESTRICTED SUBSIDIARY" means (i) any Subsidiary of the Company (other
than Interstate Jitney-Jungle Stores, Inc., McCarty-Holman Co., Inc., Southern
Jitney Jungle Company, Pump And Save, Inc. DAC, SCSI and Delchamps or any
successor to any of them) that is designated by the Board of Directors as an
Unrestricted Subsidiary pursuant to a Board Resolution and (ii) any Subsidiary
of an Unrestricted Subsidiary; but, in each case, only to the extent that such
Subsidiary: (a) has no Indebtedness other than Non-Recourse Debt; (b) is not
party to any agreement, contract, arrangement or understanding with the Company
or any Restricted Subsidiary of the Company unless the terms of any such
agreement, contract, arrangement or understanding are no less favorable to the
Company or such Restricted Subsidiary than those that might be obtained at the
time from Persons who are not Affiliates of the Company; (c) is a Person with
respect to which neither the Company nor any of its Restricted Subsidiaries has
any direct or indirect obligation (x) to subscribe for additional Equity
Interests or (y) to maintain or preserve such Person's financial condition or to
cause such Person to achieve any specified levels of operating results; (d) has
not guaranteed or otherwise directly or indirectly provided credit support for
any Indebtedness of the Company or any of its Restricted Subsidiaries; and (e)
has at least one director on its board of directors that is not a director or
executive officer of the Company or any of its Restricted Subsidiaries and has
at least one executive officer that is not a director or executive officer of
the Company or any of its Restricted Subsidiaries. Any such designation by the
Board of Directors shall be evidenced to the Trustee by filing with the Trustee
a certified copy of the Board Resolution giving effect to such designation and
an officers' certificate indicating that such designation complied with the
foregoing conditions and was permitted by the covenant described above under the
caption "Certain Covenants--Restricted Payments." If, at any time, any
Unrestricted Subsidiary would fail to meet the foregoing requirements as an
Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of the Indenture and any Indebtedness of such Subsidiary
shall be deemed to be incurred by a Restricted Subsidiary of the Company as of
such date (and, if such Indebtedness is not permitted to be incurred as of such
date under the covenant described under the caption "Certain
Covenants--Incurrence of Indebtedness and Issuance of
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Disqualified Stock," the Company shall be in default of such covenant). The
Board of Directors of the Company may at any time designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; PROVIDED that such designation shall
be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the
Company of any outstanding Indebtedness of such Unrestricted Subsidiary and such
designation shall only be permitted if (i) such Indebtedness is permitted under
the covenant described under the caption "Certain Covenants--Incurrence of
Indebtedness and Issuance of Disqualified Stock," (ii) no Default or Event of
Default would be in existence immediately following such designation and (iii)
the Company shall have delivered to the Trustee an officers' certificate
indicating that such designation complied with the foregoing conditions.
"WARRANTS" means the warrants to purchase up to 15% (on a fully diluted
basis) of the common stock, par value $0.01 per share, of the Company dated
March 5, 1996.
"WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing (i) the sum of the
products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (ii) the then outstanding principal
amount of such Indebtedness.
"WHOLLY OWNED RESTRICTED SUBSIDIARY" of any Person means a Restricted
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person, or by such Person and one or more Wholly Owned
Restricted Subsidiaries of such Person.
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BOOK-ENTRY; DELIVERY AND FORM
Except as set forth below, the New Notes will initially be issued in the
form of one registered note in global form without coupons (the "Global Note").
Upon issuance, the Global Note will be deposited with, or on behalf of, the
Depository Trust Company (the "Depositary") and registered in the name of Cede &
Co., as nominee of the Depositary.
If a holder tendering Existing Notes so requests, such holder's New Notes
will be issued as described below under "Certificated Securities" in registered
form without coupons (the "Certificated Securities").
The Depositary has advised the Company that it is (i) a limited purpose
trust company organized under the laws of the State of New York, (ii) a member
of the Federal Reserve System, (iii) a "clearing corporation" within the meaning
of the Uniform Commercial Code, as amended, and (iv) a "Clearing Agency"
registered pursuant to Section 17A of the Exchange Act. The Depositary was
created to hold securities for its participants (collectively, the
"Participants") and facilitates the clearance and settlement of securities
transactions between Participants through electronic book-entry changes to the
accounts of its Participants, thereby eliminating the need for physical transfer
and delivery of certificates. The Depositary's Participants include securities
brokers and dealers (including the Initial Purchaser), banks and trust
companies, clearing corporations and certain other organizations. Access to the
Depositary's system is also available to other entities such as banks, brokers,
dealers and trust companies (collectively, the "Indirect Participants") that
clear through or maintain a custodial relationship with a Participant, either
directly or indirectly.
The Company expects that pursuant to procedures established by the
Depositary (i) upon deposit of the Global Notes, the Depositary will credit the
accounts of Participants who elect to exchange Existing Notes with an interest
in the Global Note and (ii) ownership of the New Notes will be shown on, and the
transfer of ownership thereof will be effected only through, records maintained
by the Depositary (with respect to the interest of Participants), the
Participants and the Indirect Participants. The laws of some states require that
certain persons take physical delivery in definitive form of securities that
they own and that securities interests in negotiable instruments can only be
perfected by delivery of certificates representing the instruments.
So long as the Depositary or its nominee is the registered owner of the
Global Note, the Depositary or such nominee, as the case may be, will be
considered the sole owner or holder of the New Notes represented by the Global
Note for all purposes under the Indenture. Except as provided below, owners of
beneficial interests in the Global Note will not be entitled to have New Notes
represented by such Global Note registered in their names, will not receive or
be entitled to receive physical delivery of Certificated Securities, and will
not be considered the owners or holders thereof under the Indenture for any
purpose, including with respect to the giving of any directions, instruction or
approval to the Trustee thereunder. As a result, the ability of a person having
a beneficial interest in New Notes represented by the Global Note to pledge such
interest to persons or entities that do not participate in the Depositary's
system, or to otherwise take action with respect to such interest, may be
affected by the lack of a physical certificate evidencing such interest.
The Company understands that under existing industry practice, in the event
the Company requests any action of holders or an owner of a beneficial interest
in the Global Note desires to take any action that the Depositary, as the holder
of such Global Note, is entitled to take, the Depositary would authorize the
Participants to take such action and the Participant would authorize persons
owning through such Participants to take such action or would otherwise act upon
the instruction of such persons. Neither the Company nor the Trustee will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of New Notes by the Depositary, or for maintaining,
supervising or reviewing any records of the Depositary relating to such New
Notes.
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Payments with respect to the principal of, premium, if any, and interest on
any New Notes represented by the Global Note registered in the name of the
Depositary or its nominee on the applicable record date will be payable by the
Trustee to or at the direction of the Depositary or its nominee in its capacity
as the registered holder of the Global Note representing such New Notes under
the Indenture. Under the terms of the Indenture, the Company and the Trustee may
treat the persons in whose names the New Notes, including the Global Note, are
registered as the owners thereof for the purpose of receiving such payment and
for any and all other purposes whatsoever. Consequently, neither the Company nor
the Trustee has or will have any responsibility for liability for the payment of
such amounts to beneficial owners of New Notes (including principal, premium, if
any, and interest), or to immediately credit the accounts of the relevant
Participants with such payment, in amounts proportionate to their respective
holdings in principal amount of beneficial interest in the Global Note as shown
on the records of the Depositary. Payments by the Participants and the Indirect
Participants to the beneficial owners of New Notes will be governed by standing
instructions and customary practice and will be the responsibility of the
Participants or the Indirect Participants.
CERTIFICATED SECURITIES
If (i) the Company notifies the Trustee in writing that the Depositary is no
longer willing or able to act as a depository and the Company is unable to
locate a qualified successor within 90 days or (ii) the Company, at its option,
notifies the Trustee in writing that it elects to cause the issuance of Notes in
definitive form under the Indenture, then, upon surrender by the Depositary of
its Global Note, Certificated Securities will be issued to each person that the
Depositary identifies as the beneficial owner of the New Notes represented by
the Global Note. In addition, any person having a beneficial interest in the
Global Note or any holder of Exiting Notes whose Existing Notes have been
accepted for exchange may, upon request to the Trustee or the Exchange Agent, as
the case may be, exchange such beneficial interest or Existing Notes for
Certificated Securities. Upon any such issuance, the Trustee is required to
register such Certificated Securities in the name of such person or persons (or
the nominee of any thereof), and cause the same to be delivered thereto.
Neither the Company nor the Trustee shall be liable for any delay by the
Depositary or any Participant or Indirect Participant in identifying the
beneficial owners of the related New Notes and each such person may conclusively
rely on, and shall be protected in relying on, instructions from the Depositary
for all purposes (including with respect to the registration and delivery, and
the respective principal amounts, of the New Notes to the issued).
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CERTAIN FEDERAL INCOME TAX CONSIDERATIONS
The following discussion summarizes the material United States federal
income tax consequences of the Exchange Offer to a holder of Existing Notes that
is an individual citizen or resident of the United States or a United States
corporation that purchased the Existing Notes pursuant to their original issue
(a "U.S. Holder"). It is based on the Internal Revenue Code of 1986, as amended
to the date hereof (the "Code"), existing and proposed Treasury regulations, and
judicial and administrative determinations, all of which are subject to change
at any time, possibly on a retroactive basis. The following relates only to the
Existing Notes, and the New Notes received therefor, that are held as "capital
assets" within the meaning of Section 1221 of the Code by U.S. Holders. It does
not discuss state, local, or foreign tax consequences, nor does it discuss tax
consequences to subsequent purchasers (persons who did not purchase the Existing
Notes pursuant to their original issue), or to categories of holders that are
subject to special rules, such as foreign persons, tax-exempt organizations,
insurance companies, banks, and dealers in stocks and securities. Tax
consequences may vary depending on the particular status of an investor. No
rulings will be sought from the Internal Revenue Service with respect to the
federal income tax consequences of the Exchange Offer.
THIS SECTION DOES NOT PURPORT TO DEAL WITH ALL ASPECTS OF FEDERAL INCOME
TAXATION THAT MAY BE RELEVANT TO AN INVESTOR'S DECISION TO EXCHANGE EXISTING
NOTES FOR NEW NOTES. EACH INVESTOR SHOULD CONSULT WITH ITS OWN TAX ADVISOR
CONCERNING THE APPLICATION OF THE FEDERAL INCOME TAX LAWS AND OTHER TAX LAWS TO
ITS PARTICULAR SITUATION BEFORE DETERMINING WHETHER TO EXCHANGE EXISTING NOTES
FOR NEW NOTES.
THE EXCHANGE OFFER
The exchange of Existing Notes pursuant to the Exchange Offer should be
treated as a continuation of the corresponding Existing Notes because the terms
of the New Notes are not materially different from the terms of the Existing
Notes. Accordingly, such exchange should not constitute a taxable event to U.S.
Holders and, therefore, (i) no gain or loss should be realized by a U.S. Holder
upon receipt of a New Note, (ii) the holding period of the New Note should
include the holding period of the Existing Note exchanged therefor and (iii) the
adjusted tax basis of the New Note should be the same as the adjusted tax basis
of the Existing Note exchanged therefor immediately before the exchange.
STATED INTEREST
Stated interest on a Note will be taxable to a U.S. Holder as ordinary
interest income at the time that such interest accrues or is received, in
accordance with the U.S. Holder's regular method of accounting for federal
income tax purposes. The Notes are not considered to have been issued with
original issue discount for federal income tax purposes.
SALE, EXCHANGE OR RETIREMENT OF THE NOTES
A U.S. Holder's tax basis in a Note generally will be its cost. A U.S.
Holder generally will recognize gain or loss on the sale, exchange or retirement
of a Note in an amount equal to the difference between the amount realized on
the sale, exchange or retirement and the tax basis of the Note. Gain or loss
recognized on the sale, exchange or retirement of a Note (excluding amounts
received in respect of accrued interest, which will be taxable as ordinary
interest income) generally will be capital gain or loss. In the case of a U.S.
Holder who is an individual, such capital gain may be taxed at a maximum rate of
28% if the holding period of the New Notes exceeds one year or a maximum rate of
20% if the holding period of the New Notes exceeds eighteen months.
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BACKUP WITHHOLDING
Under certain circumstances, a U.S. Holder of a Note may be subject to
"backup withholding" at a 31% rate with respect to payments of interest thereon
or the gross proceeds from the disposition thereof. This withholding generally
applies if the U.S. Holder fails to furnish his or her social security number or
other taxpayer identification number in the specified manner and in certain
other circumstances. Any amount withheld from a payment to a U.S. Holder under
the backup withholding rules is allowable as a credit against such U.S. Holder's
federal income tax liability, provided that the required information is
furnished to the IRS. Corporations and certain other entities described in the
Code and Treasury regulations are exempt from backup withholding if their exempt
status is properly established.
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Notes for its own account pursuant to
the Exchange Offer must acknowledge that it will deliver a prospectus in
connection with any resale of such New Notes. This Prospectus, as it may be
amended or supplemented from time to time, may be used by a broker-dealer in
connection with resales of New Notes received in exchange for Existing Notes
where such Existing Notes were acquired as a result of market-making activities
or other trading activities. The Company has agreed that, for a period of 180
days after the Exchange Offer Registration Statement is declared effective, it
will make this Prospectus, as amended or supplemented, available to any
broker-dealer for use in connection with any such resale. In addition, until
February 5, 1998 (90 days after the date of this Prospectus), all dealers
effecting transactions in the New Notes may be required to deliver a prospectus.
The Company will not receive any proceeds from any sale of New Notes by
broker-dealers. New Notes received by broker-dealers for their own account
pursuant to the Exchange Offer may be sold from time to time in one or more
transactions in the over-the-counter market, in negotiated transactions, through
the writing of options on the New Notes or a combination of such methods of
resale, at market prices prevailing at the time of resale, at prices related to
such prevailing market prices or negotiated prices. Any such resale may be made
directly to purchasers or to or through brokers or dealers who may receive
compensation in the form of commissions or concessions from any such
broker-dealer or the purchasers of any such New Notes. Any broker-dealer that
resells New Notes that were received by it for its own account pursuant to the
Exchange Offer and any broker or dealer that participates in a distribution of
such New Notes may be deemed to be an "underwriter" within the meaning of the
Securities Act and any profit on any such resale of New Notes and any
commissions or concessions received by any such persons may be deemed to be
underwriting compensation under the Securities Act. The Letter of Transmittal
states that, by acknowledging that it will deliver and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
For a period of 180 days after the Expiration Date, the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. The Company has agreed to pay all expenses
incident to the Exchange Offer (including the expenses of one counsel for the
holders of the Existing Notes) other than commissions or concessions of any
brokers or dealers and will indemnify the holders of the Existing Notes
(including any broker-dealers) against certain liabilities, including
liabilities under the Securities Act.
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LEGAL MATTERS
The validity of the New Notes offered hereby will be passed upon for the
Company by Dechert Price & Rhoads, New York, New York.
EXPERTS
The consolidated financial statements of Jitney-Jungle included in this
Prospectus and Registration Statement have been audited by Deloitte & Touche
LLP, independent auditors, as stated in their report thereon appearing elsewhere
herein, and are included in reliance upon such firm given upon their authority
as experts in accounting and auditing. The consolidated financial statements of
Delchamps Inc., and subsidiary as of June 28, 1997 and June 29, 1996 and for
each of the years in the three-year period ended June 28, 1997 have been
included in this Prospectus and in the Registration Statement in reliance on the
report of KPMG Peat Marwick L.L.P., independent certified public accountants,
appearing elsewhere herein, and upon the authority of said firm as experts in
accounting and auditing.
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INDEX TO FINANCIAL STATEMENTS
JITNEY-JUNGLE STORES OF AMERICA, INC.
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Independent Auditors' Report............................................................................... F-3
Consolidated Balance Sheets as of April 27, 1996, May 3, 1997 and July 26, 1997 (unaudited)................ F-4
Consolidated Statements of Earnings for the Years Ended April 29, 1995, April 27, 1996 and May 3, 1997 and
the 12 weeks Ended July 20, 1996 (unaudited) and July 26, 1997 (unaudited)............................... F-6
Consolidated Statements of Changes in Stockholders' Equity for the Years Ended April 29, 1995, April 27,
1996 and May 3, 1997 and the 12 weeks Ended July 20, 1996 (unaudited) and July 26, 1997 (unaudited)...... F-7
Consolidated Statements of Cash Flows for the Years Ended April 29, 1995, April 27, 1996 and and May 3,
1997 and the 12 weeks Ended July 20, 1996 (unaudited) and July 26, 1997 (unaudited)...................... F-8
Notes to Consolidated Financial Statements................................................................. F-9
</TABLE>
DELCHAMPS, INC.
<TABLE>
<CAPTION>
PAGE
---------
<S> <C>
Independent Auditors' Report............................................................................... F-22
Consolidated Balance Sheets as of June 29, 1996 and June 28, 1997.......................................... F-23
Consolidated Statements of Earnings for the Years Ended
July 1, 1995, June 29, 1996 and June 28, 1997............................................................ F-24
Consolidated Statements of Stockholders' Equity for the Years Ended July 1, 1995, June 29, 1996 and June
28, 1997................................................................................................. F-25
Consolidated Statements of Cash Flows for the Years Ended July 1, 1995,
June 29, 1996 and June 28, 1997.......................................................................... F-26
Notes to Consolidated Financial Statements................................................................. F-27
</TABLE>
F-1
<PAGE>
(This page has been left blank intentionally.)
F-2
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Stockholders of
Jitney-Jungle Stores of America, Inc.:
We have audited the accompanying consolidated balance sheets of Jitney-Jungle
Stores of America, Inc. and subsidiaries (the "Company") as of May 3, 1997 and
April 27, 1996, and the related consolidated statements of earnings, changes in
stockholders' equity, and cash flows for each of the three fiscal years in the
period ended May 3, 1997. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of Jitney-Jungle Stores of America,
Inc. and subsidiaries as of May 3, 1997 and April 27, 1996, and the results of
their operations and their cash flows for each of the three fiscal years in the
period ended May 3, 1997, in conformity with generally accepted accounting
principles.
DELOITTE & TOUCHE LLP
July 10, 1997
Jackson, Mississippi
F-3
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
APRIL 27, MAY 3, JULY 26,
1996 1997 1997
---------- ---------- -----------
<S> <C> <C> <C>
(UNAUDITED)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents................................................. $ 5,676 $ 14,426 $ 5,255
Investments in debt securities............................................ 337 -- --
Receivables............................................................... 4,892 5,463 7,423
Inventories:
Stores.................................................................. 48,907 43,462 47,328
Warehouses.............................................................. 28,538 21,157 30,366
Prepaid expenses and other................................................ 5,155 1,213 6,507
Deferred income taxes..................................................... 376 2,152 2,152
---------- ---------- -----------
Total current assets.................................................... 93,881 87,873 99,031
PROPERTY AND EQUIPMENT, at cost:
Land...................................................................... 2,782 2,648 2,573
Buildings................................................................. 22,537 26,370 26,568
Fixtures and equipment.................................................... 165,202 167,241 170,186
Property under capitalized leases......................................... 76,371 74,089 74,089
Leasehold improvements.................................................... 39,003 41,518 43,014
---------- ---------- -----------
Total................................................................... 305,895 311,866 316,430
Less accumulated depreciation and amortization............................ 130,480 140,378 147,262
Net property and equipment.............................................. 175,415 171,488 169,168
---------- ---------- -----------
OTHER ASSETS................................................................ 9,707 8,484 16,732
---------- ---------- -----------
TOTAL ASSETS................................................................ $ 279,003 $ 267,845 $ 284,931
---------- ---------- -----------
---------- ---------- -----------
</TABLE>
See notes to consolidated financial statements.
F-4
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (CONTINUED)
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
APRIL 27, MAY 3, JULY 26,
1996 1997 1997
----------- ----------- -----------
<S> <C> <C> <C>
(UNAUDITED)
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
Accounts payable......................................................... $ 40,008 $ 49,978 $ 60,940
Accrued expenses:
Personnel costs........................................................ 6,042 9,350 7,548
Taxes, other than income taxes......................................... 6,738 8,436 8,148
Insurance claims....................................................... 4,110 5,972 7,006
Interest............................................................... 3,742 4,298 9,679
Other.................................................................. 2,533 5,032 1,843
Current portion of capitalized leases.................................... 4,259 4,899 4,899
Current portion of long-term debt........................................ -- -- 4,923
----------- ----------- -----------
Total current liabilities............................................ 67,432 87,965 104,986
LONG-TERM DEBT............................................................. 239,059 208,000 206,876
OBLIGATIONS UNDER CAPITALIZED LEASES,
less current installments................................................ 59,143 59,563 58,663
DEFERRED INCOME TAXES...................................................... 8,196 6,398 6,328
----------- ----------- -----------
Total liabilities...................................................... 373,830 361,926 376,853
COMMITMENTS AND CONTINGENCIES (Notes 6, 7, 9 and 14)
REDEEMABLE PREFERRED STOCK (aggregate liquidation
preference value of $52,342 at April 27, 1996, $60,086 at
May 3, 1997 and $61,624 at July 26, 1997)................................ 49,988 57,921 59,508
STOCKHOLDERS' EQUITY (DEFICIT):
Class C Preferred Stock--Series 1 (at liquidation preference value)...... 7,604 8,502 8,663
Common Stock ($.01 par value, authorized 5,000,000 shares, issued and
outstanding 425,000 shares)............................................ 4 4 4
Additional paid-in capital............................................... (302,326) (302,326) (302,326)
Retained earnings........................................................ 149,903 141,818 142,229
----------- ----------- -----------
Total stockholders' equity (deficit)................................... (144,815) (152,002) (151,430)
----------- ----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)................................................................ $ 279,003 $ 267,845 $ 284,931
----------- ----------- -----------
----------- ----------- -----------
</TABLE>
See notes to consolidated financial statements.
F-5
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
YEAR ENDED 12 WEEKS ENDED
---------------------------------------- ----------------------
<S> <C> <C> <C> <C> <C>
APRIL 29, APRIL 27, MAY 3, JULY 20, JULY 26,
1995 1996 1997 1996 1997
------------ ------------ ------------ ---------- ----------
<CAPTION>
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
NET SALES...................................... $ 1,173,927 $ 1,179,318 $ 1,228,533 $ 282,166 $ 288,978
COSTS AND EXPENSES:
Cost of sales................................ 885,739 887,255 925,446 211,627 216,464
Direct store expenses........................ 189,422 193,483 199,956 45,447 48,058
Warehouse, administrative and general........ 57,723 60,603 63,094 14,241 12,772
Interest expense, net........................ 10,823 13,000 36,215 8,378 8,241
Special charges.............................. -- -- 2,737 -- --
------------ ------------ ------------ ---------- ----------
Total costs and expenses................... 1,143,707 1,154,341 1,227,448 279,693 285,535
------------ ------------ ------------ ---------- ----------
Earnings before taxes on income and
extraordinary item........................... 30,220 24,977 1,085 2,473 3,443
TAXES ON INCOME................................ 11,417 9,062 339 921 1,284
------------ ------------ ------------ ---------- ----------
Earnings before extraordinary item............. $ 18,803 $ 15,915 $ 746 $ 1,552 $ 2,159
EXTRAORDINARY ITEM, NET OF INCOME TAX BENEFIT
OF $866...................................... -- (1,456) -- -- --
------------ ------------ ------------ ---------- ----------
NET EARNINGS................................... $ 18,803 $ 14,459 $ 746 $ 1,552 $ 2,159
------------ ------------ ------------ ---------- ----------
------------ ------------ ------------ ---------- ----------
EARNINGS (LOSS) PER COMMON AND COMMON
EQUIVALENT SHARE:
Earnings (loss) before extraordinary item...... $ 923.15 $ 162.88 $ (16.26) $ (0.12) $ 0.92
Extraordinary item............................. -- (15.96) -- -- --
------------ ------------ ------------ ---------- ----------
Net earnings (loss)............................ $ 923.15 $ 146.92 $ (16.26) $ (0.12) $ 0.92
------------ ------------ ------------ ---------- ----------
------------ ------------ ------------ ---------- ----------
</TABLE>
See notes to consolidated financial statements.
F-6
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
CLASS C
PREFERRED STOCK
SERIES 1 COMMON STOCK
---------------------- --------------------
<S> <C> <C> <C> <C> <C> <C>
NUMBER NUMBER ADDITIONAL
OF OF PAID-IN RETAINED
SHARES AMOUNT SHARES AMOUNT CAPITAL EARNINGS
----------- --------- --------- --------- ----------- ----------
BALANCE, APRIL 30, 1994.................................. -- -- 20,368 $ 1,061 $ 1,807 $ 121,989
Cash dividends ($169.09 per share)....................... -- -- -- -- -- (3,444)
Net earnings............................................. -- -- -- -- -- 18,803
----------- --------- --------- --------- ----------- ----------
BALANCE, APRIL 29, 1995.................................. -- -- 20,368 1,061 1,807 137,348
Cash dividends ($92.15 per share)........................ -- -- -- -- -- (1,877)
Net earnings............................................. -- -- -- -- -- 14,459
Issuance of shares and warrants.......................... 76,042 $ 7,604 425,000 4 7,377 --
Redemption of common stock and related merger costs...... -- -- (20,368) (1,061) (311,510) --
Accretion of discount on Class A Preferred
Stock.................................................. -- -- -- -- -- (27)
----------- --------- --------- --------- ----------- ----------
BALANCE, APRIL 27, 1996.................................. 76,042 7,604 425,000 4 (302,326) 149,903
Net earnings............................................. -- -- -- -- -- 1,552
Accretion of discount on Class A Preferred
Stock.................................................. -- -- -- -- -- (47)
Cumulation of dividends on Preferred Stock............... -- 898 -- -- -- (8,642)
----------- --------- --------- --------- ----------- ----------
BALANCE, MAY 3, 1997..................................... 76,042 8,502 425,000 4 (302,326) 141,818
Net earnings............................................. -- -- -- -- -- 2,159
Accretion of discount on Class A Preferred
Stock.................................................. -- -- -- -- -- (48)
Cumulation of dividends on Preferred Stock............... -- 161 -- -- -- (1,700)
----------- --------- --------- --------- ----------- ----------
BALANCE, JULY 26, 1997 (UNAUDITED)....................... 76,042 $ 8,663 425,000 $ 4 $ (302,326) $ 142,229
----------- --------- --------- --------- ----------- ----------
----------- --------- --------- --------- ----------- ----------
</TABLE>
See notes to consolidated financial statements.
F-7
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
12 WEEKS
YEAR ENDED ENDED
--------------------------------- -----------
<S> <C> <C> <C> <C>
APRIL 29, APRIL 27, MAY 3, JULY 20,
1995 1996 1997 1996
----------- --------- --------- -----------
<CAPTION>
(UNAUDITED)
<S> <C> <C> <C> <C>
OPERATING ACTIVITIES:
Net earnings.............................................................. $ 18,803 $ 14,459 $ 746 $ 1,552
Adjustment to reconcile net earnings to net cash
provided by operating activities:
Extraordinary Item...................................................... -- 1,456 -- --
Depreciation and amortization........................................... 25,444 27,323 31,319 7,062
Loss on disposition of property and other
assets.................................................................. 1,037 817 1,899 (46)
Deferred income tax expense (benefit)................................... 2,260 2,577 (3,574) --
Changes in assets and liabilities:
Receivables........................................................... 43 5,866 (571) (707)
Store and warehouse inventories....................................... (3,621) 5,826 12,826 (2,034)
Prepaid expenses and other............................................ (1,630) (2,011) 3,941 1,064
Accounts payable...................................................... 2,690 1,562 9,970 9,663
Accrued expenses...................................................... 644 (2,356) 9,923 1,550
----------- --------- --------- -----------
Net cash provided by operating
activities........................................................ 45,670 55,519 66,479 18,104
----------- --------- --------- -----------
INVESTING ACTIVITIES:
Capital expenditures...................................................... (23,921) (30,111) (24,099) (6,122)
Debt issue costs.......................................................... -- (8,214) -- --
Proceeds from sale of property and other assets........................... 1,210 2,617 1,477 1,097
Purchase of investments in debt securities................................ (65,416) (23,026) -- --
Maturities of investments in debt securities.............................. 42,096 46,301 337 337
----------- --------- --------- -----------
Net cash used in investing activities............................... (46,031) (12,433) (22,285) (4,688)
----------- --------- --------- -----------
FINANCING ACTIVITIES:
Proceeds from issuance of long-term debt.................................. -- 239,059 -- --
Proceeds from issuance of stock and warrants.............................. -- 35,840 -- --
Redemption of common stock and related merger
costs..................................................................... -- (286,824) -- 30
Payments on long-term debt................................................ (2,431) (38,412) (31,059) (15,826)
Payments on capitalized lease obligations................................. (4,342) (5,355) (4,385) (263)
Dividends paid............................................................ (3,444) (1,877) -- --
----------- --------- --------- -----------
Net cash used in financing activities............................... (10,217) (57,569) (35,444) (16,059)
----------- --------- --------- -----------
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS............................................................... (10,578) (14,483) 8,750 (2,643)
----------- --------- --------- -----------
CASH AND CASH EQUIVALENTS,
Beginning of Year........................................................ 30,737 20,159 5,676 5,676
----------- --------- --------- -----------
CASH AND CASH EQUIVALENTS, End of Year...................................... $ 20,159 $ 5,676 $ 14,426 $ 3,033
----------- --------- --------- -----------
----------- --------- --------- -----------
NON-CASH INVESTING AND FINANCING
ACTIVITIES:
Capitalized lease obligations incurred.................................... $ 3,158 $ 7,971 $ 3,538
----------- --------- ---------
----------- --------- ---------
Insurance premiums financed...............................................
Recapitalization transactions:
Preferred stock issued in exchange for notes
receivable and common stock........................................... $ 184
Preferred stock issued in settlement of
deferred compensation obligation...................................... 712
Preferred stock issued in redemption of
common stock.......................................................... 27,446
Common stock issued in exchange for
notes receivable...................................................... 176
Common stock issued in redemption of
common stock.......................................................... 588
---------
$ 29,106
---------
---------
SUPPLEMENTAL DISCLOSURES:
Cash paid for interest.................................................... $ 12,534 $ 12,915 $ 35,902 $ 2,786
----------- --------- --------- -----------
----------- --------- --------- -----------
Cash paid for income taxes, net of refunds................................ $ 10,283 $ 7,700 $ (1,521) $ 15
----------- --------- --------- -----------
----------- --------- --------- -----------
<CAPTION>
<S> <C>
JULY 26,
1997
---------
<S> <C>
OPERATING ACTIVITIES:
Net earnings.............................................................. $ 2,159
Adjustment to reconcile net earnings to net cash
provided by operating activities:
Extraordinary Item...................................................... --
Depreciation and amortization........................................... 6,982
Loss on disposition of property and other
assets.................................................................. (3)
Deferred income tax expense (benefit)................................... --
Changes in assets and liabilities:
Receivables........................................................... (1,960)
Store and warehouse inventories....................................... (13,075)
Prepaid expenses and other............................................ (371)
Accounts payable...................................................... 10,962
Accrued expenses...................................................... 1,136
---------
Net cash provided by operating
activities........................................................ 5,830
---------
INVESTING ACTIVITIES:
Capital expenditures...................................................... (4,985)
Debt issue costs.......................................................... --
Proceeds from sale of property and other assets........................... 81
Purchase of investments in debt securities................................ --
Maturities of investments in debt securities.............................. --
---------
Net cash used in investing activities............................... (4,904)
---------
FINANCING ACTIVITIES:
Proceeds from issuance of long-term debt.................................. --
Proceeds from issuance of stock and warrants.............................. --
Redemption of common stock and related merger
costs..................................................................... --
Payments on long-term debt................................................ (9,197)
Payments on capitalized lease obligations................................. (900)
Dividends paid............................................................ --
---------
Net cash used in financing activities............................... (10,097)
---------
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS............................................................... (9,171)
---------
CASH AND CASH EQUIVALENTS,
Beginning of Year........................................................ 14,426
---------
CASH AND CASH EQUIVALENTS, End of Year...................................... $ 5,255
---------
---------
NON-CASH INVESTING AND FINANCING
ACTIVITIES:
Capitalized lease obligations incurred....................................
Insurance premiums financed............................................... $ 12,996
---------
---------
Recapitalization transactions:
Preferred stock issued in exchange for notes
receivable and common stock...........................................
Preferred stock issued in settlement of
deferred compensation obligation......................................
Preferred stock issued in redemption of
common stock..........................................................
Common stock issued in exchange for
notes receivable......................................................
Common stock issued in redemption of
common stock..........................................................
SUPPLEMENTAL DISCLOSURES:
Cash paid for interest.................................................... $ 2,860
---------
---------
Cash paid for income taxes, net of refunds................................ $ 2,895
---------
---------
</TABLE>
See notes to consolidated financial statements.
F-8
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. NATURE OF OPERATIONS AND BASIS OF PRESENTATION -- Jitney-Jungle operates
supermarkets and gasoline stations located in six southeastern states primarily
using distribution centers located in Jackson, Mississippi.
The consolidated financial statements include those of Jitney-Jungle Stores
of America, Inc. and its wholly-owned subsidiaries, Southern Jitney Jungle
Company, Interstate Jitney Jungle Stores, Inc., McCarty-Holman Co., Inc. and
subsidiary, and Jitney Jungle Bakery, Inc. All material intercompany profits,
transactions and balances have been eliminated.
B. USE OF ESTIMATES -- The consolidated financial statements are prepared in
conformity with generally accepted accounting principles which require
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
C. FISCAL YEAR -- Jitney-Jungle's fiscal year ends on the Saturday nearest
April 30. Fiscal 1995 and 1996 include the operations of 52 weeks and fiscal
1997 includes the operations of 53 weeks.
D. INVESTMENTS IN DEBT SECURITIES -- Debt securities have been categorized
as available for sale and as a result are stated at fair value. The cost of debt
securities is adjusted for amortization of premiums and accretion of discounts
to maturity. Such amortization and interest are included in interest income.
Realized gains and losses are included in other income or expense. Unrealized
holding gains and losses are included as a component of stockholders' equity
until realized. The cost of securities sold is based on the specific
identification method.
E. INVENTORIES -- Store inventories are stated at cost (last-in, first-out
method), as determined principally by the retail inventory method. Warehouse
inventories are stated at cost (last-in, first-out method).
F. CAPITALIZATION, DEPRECIATION AND AMORTIZATION -- The cost of property,
fixtures, equipment and improvements is depreciated and amortized by the
straight-line method over the estimated useful lives of the assets. The
estimated useful lives of buildings range up to forty years and the estimated
useful life of fixtures and equipment is eight years. Capitalized lease assets
are recorded at the lower of fair market value or the present value of future
minimum lease payments. These assets and leasehold improvements are amortized by
the straight-line method over their primary lease term. License and franchise
rights are amortized by the straight-line method over twenty years. Debt issue
costs are amortized over the life of the related debt by the interest method. At
each balance sheet date the Company evaluates the recoverability of property,
equipment and other long-term assets based upon expectations of nondiscounted
cash flows and operating income.
G. STORE OPENING/CLOSING COSTS -- Non-capital expenditures incurred for new
or remodeled retail stores are expensed as incurred. When a store is closed, the
remaining investment in fixtures and leasehold improvements, net of expected
salvage, is charged against earnings; the present value of any remaining lease
liability, net of expected sublease recovery, is also expensed.
F-9
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
H. INCOME TAXES -- Deferred tax liabilities and assets are determined based
on the differences between the financial statement and tax bases of assets and
liabilities using enacted tax rates in effect in the years in which the
differences are expected to reverse.
I. CASH EQUIVALENTS -- For purposes of reporting cash flows, cash
equivalents include investments with maturities of three months or less when
purchased.
J. PER SHARE AMOUNTS -- Earnings per common and common equivalent share is
based on net income (loss) after preferred stock dividend requirements ($987 in
fiscal 1996, $7,655 in fiscal 1997, and the weighted average number of shares
outstanding during each year including shares attributed to outstanding warrants
to purchase common stock. For fiscal 1997, warrants have not been included as
their effect is antidilutive. The number of shares used in computing the
earnings (loss) per share was 20,368 in fiscal 1995, 91,241 in fiscal 1996 and
425,000 in fiscal 1997.
Dividends per common share are presented on the basis of total dividends
paid, including dividends paid by the entities acquired in the business
acquisitions accounted for in a manner similar to that followed for poolings of
interest (see Note 2), divided by common shares outstanding after giving
retroactive effect to common shares issued in such business acquisitions.
K. RECLASSIFICATIONS -- Certain reclassifications have been made in the 1995
and 1996 consolidated financial statements to conform to the 1997 method of
presentation.
2. MERGER ACTIVITIES
In a series of transactions that were consummated on March 5, 1996,
Jitney-Jungle acquired all of the issued and outstanding stock of Southern
Jitney Jungle Company, McCarty-Holman Company, Inc. and Jitney Jungle Bakery
(each of which was under common control with Jitney-Jungle) in exchange for
7,495 shares of common stock. These acquisitions have been accounted for at
historical cost in a manner similar to that followed for poolings of interest.
Prior to the acquisition, the operating results of the acquired entities had
been included in Jitney-Jungle's financial statements on a combined basis.
Accordingly, the acquisitions had no effect on the previously reported results
of operations of Jitney-Jungle; however, for purposes of computing earnings per
share the issuance of the additional shares of common stock has been given
retroactive effect.
On March 5, 1996, JJ Acquisitions Corp. (JJAC) merged with and into
Jitney-Jungle with Jitney-Jungle continuing as the surviving corporation (the
"Merger"). JJAC was a wholly-owned subsidiary of Bruckmann, Rosser, Sherrill &
Co., L.P. (the "Fund"). Upon consummation of the Merger, the Fund and related
investors received 83.82% of Jitney-Jungle's common stock and 11.76% was
retained by the shareholders at the time of the Merger.
The Merger was accounted for as a recapitalization which resulted in a
charge to equity of $312,571 to reflect the redemption of common stock of
Jitney-Jungle outstanding immediately prior to the Merger and related merger
costs, including a closing fee of $4,000 paid to the Fund Manager, an affiliate
of the Fund's sole General Partner.
F-10
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
2. MERGER ACTIVITIES (CONTINUED)
Prior to the Merger, JJAC issued 425,000 shares of common stock for an
aggregate of $6,500, issued an aggregate of $22,500 in liquidation preference of
Class A Preferred Stock, issued $10,000 in liquidation preference of Class C
Preferred Stock, and issued warrants to purchase 75,000 shares of common stock
to the then holder (along with related investors) of 100% of the Class A
Preferred Stock and 15% of the Class C Preferred Stock. Jitney-Jungle issued
$27,446 in liquidation preference of Class B Preferred Stock as part of the
consideration to shareholders at the time of the Merger. In the Merger the
common stock, Class A Preferred Stock, and Class C Preferred Stock issued by
JJAC were converted into like shares of Jitney-Jungle and Jitney-Jungle assumed
the obligations of JJAC under the warrants.
In connection with the Merger, Jitney-Jungle retired $35,700 of long-term
debt prior to its scheduled maturity. Early retirement of this debt resulted in
an extraordinary loss of $1,456, net of an income tax benefit of $866.
3. INVENTORIES
Had the cost for all inventories been determined on the first-in, first-out
method, inventories would have been higher by approximately $18,227 at April 27,
1996 and $17,245 at May 3, 1997. LIFO liquidations resulted in an increase in
fiscal year 1997 net earnings of approximately $148. The effect on net earnings
of LIFO liquidations in fiscal years 1995 and 1996 was not material.
4. INVESTMENTS IN DEBT SECURITIES
Investments in debt securities consisted of U.S. Treasury securities which
matured in fiscal 1997. Such investments, classified as available for sale, had
no unrealized gains or losses at April 27, 1996. Proceeds from sale of
investments in debt securities were approximately $6,100 in fiscal 1995 and
$13,000 in fiscal 1996. Gains of $14 (1995) and losses of $43 (1996) were
realized on those sales.
5. OTHER ASSETS
Other assets, net of accumulated amortization of $3,059 (1996) and $3,916
(1997), consisted of the following:
<TABLE>
<CAPTION>
APRIL 27, MAY 3,
1996 1997
----------- ---------
<S> <C> <C>
Debt issue costs.............................................................................. $ 7,917 $ 6,913
License and franchise rights.................................................................. 838 746
Other, primarily covenant not to compete...................................................... 952 825
----------- ---------
Total....................................................................................... $ 9,707 $ 8,484
----------- ---------
----------- ---------
</TABLE>
F-11
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
6. PROPERTY UNDER CAPITAL LEASES AND LEASE COMMITMENTS
Leased property capitalized in the financial statements is summarized as
follows:
<TABLE>
<CAPTION>
APRIL 27, MAY 3,
1996 1997
--------- ---------
<S> <C> <C>
Store property.............................................................................. $ 76,371 $ 70,920
Computer equipment.......................................................................... -- 3,169
Less accumulated depreciation............................................................... (32,993) (32,112)
--------- ---------
$ 43,378 $ 41,977
--------- ---------
--------- ---------
</TABLE>
Most store leases provide for contingent rentals based on percentages of
sales in excess of stipulated amounts. The leases have primary terms are ranging
from five to twenty years and generally contain renewal options. Portions of
store space are sublet under leases. The present value of future minimum lease
payments relative to capitalized leases is included in the financial statements
as obligations under capitalized leases. Lease liabilities are amortized over
the lease term using the interest method.
The future minimum rental commitments for capital leases and noncancelable
operating leases as of May 3, 1997, were as follows:
<TABLE>
<CAPTION>
CAPITAL OPERATING
LEASES LEASES
---------- -----------
<S> <C> <C>
1998...................................................................................... $ 13,840 $ 6,056
1999...................................................................................... 13,693 5,176
2000...................................................................................... 13,261 4,401
2001...................................................................................... 12,114 2,557
2002...................................................................................... 10,796 1,777
Remaining balance......................................................................... 70,024 4,895
---------- -----------
Total minimum lease commitments........................................................... $ 133,728 $ 24,862
---------- -----------
---------- -----------
</TABLE>
<TABLE>
<CAPTION>
CAPITAL
LEASES
---------
<S> <C> <C>
Less amount representing estimated executory costs (taxes, maintenance and insurance)....... $ 1,917
---------
Net minimum lease commitments............................................................... 131,811
Less amount representing imputed interest................................................... 67,349
---------
Present value of minimum lease commitments.................................................. 64,462
Current portion of obligations under capitalized leases..................................... 4,899
---------
Obligations under capitalized leases, less current installments............................. $ 59,563
---------
---------
</TABLE>
F-12
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
6. PROPERTY UNDER CAPITAL LEASES AND LEASE COMMITMENTS (CONTINUED)
Minimum rental commitments have not been reduced by minimum sublease rentals
of $1,306 applicable to capital leases and $841 applicable to operating leases
due in the future under noncancelable subleases.
The following schedule shows the composition of total rental expense for all
operating leases:
<TABLE>
<CAPTION>
YEAR ENDED
---------------------------------
<S> <C> <C> <C>
APRIL 29, APRIL 27, MAY 3,
1995 1996 1997
----------- --------- ---------
Minimum rentals................................................................ $ 10,075 $ 10,211 $ 10,717
Continent rentals.............................................................. 328 346 325
Less: Sublease rentals......................................................... (323) (219) (288)
----------- --------- ---------
$ 10,080 $ 10,338 $ 10,754
----------- --------- ---------
----------- --------- ---------
</TABLE>
Rents, net of sublease income, paid to affiliated partnerships under
long-term lease commitments were as follows:
<TABLE>
<CAPTION>
YEAR ENDED
-----------------------------------
<S> <C> <C> <C>
APRIL 29, APRIL 27, MAY 3,
1995 1996 1997
----------- ----------- ---------
Capitalized Leases............................................................... $ 3,001 $ 3,017 $ 3,062
Operating leases................................................................. 321 334 331
----------- ----------- ---------
$ 3,322 $ 3,351 $ 3,393
----------- ----------- ---------
----------- ----------- ---------
</TABLE>
Obligations to affiliated partnerships under capitalized leases were $9,150
at April 27, 1996 and $8,602 at May 3, 1997.
7. LONG-TERM DEBT
Long-term debt consisted of the following:
<TABLE>
<CAPTION>
APRIL 27, MAY 3,
1996 1997
---------- ----------
<S> <C> <C>
Senior notes.............................................................................. $ 200,000 $ 200,000
Revolving credit loans.................................................................... 39,059 8,000
---------- ----------
Long-term debt............................................................................ $ 239,059 $ 208,000
---------- ----------
---------- ----------
</TABLE>
Aggregate maturities of long-term debt for the fiscal years following May 3,
1997 are as follows:
<TABLE>
<S> <C>
2001.............................................................................. $ 8,000
2006.............................................................................. 200,000
---------
$ 208,000
---------
---------
</TABLE>
F-13
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
7. LONG-TERM DEBT (CONTINUED)
In March 1996, Jitney-Jungle issued $200,000 of unsecured Senior Notes which
mature on March 1, 2006 and accrue interest at the rate of 12% per annum payable
semi-annually. The proceeds from issuance of the Senior Notes were used to fund
a portion of the Merger consideration (See Note 2). Except under certain
conditions, the Senior Notes are not redeemable at Jitney-Jungle's option prior
to March 1, 2001. Thereafter, the Senior Notes are subject to redemption at the
option of Jitney-Jungle at 106% of principal amount if redeemed during the
twelve-month period beginning March 1, 2001 decreasing to 100% of principal
amount if redeemed during the twelve-month period beginning March 1, 2004 and
thereafter plus accrued and unpaid interest thereon.
In the event of a change of control as defined in the Indenture, holders of
Senior Notes have the right to require Jitney-Jungle to repurchase all or any
part of such holder's notes at a price in cash equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest thereon.
In March 1996, Jitney-Jungle entered into a revolving credit agreement with
a bank which provides a $100,000 Credit Facility. The Credit Facility was used
to finance a portion of the Merger consideration, refinance certain
indebtedness, and provide for working capital requirements. The commitments
under the Credit Facility will terminate and all loans outstanding thereunder
will be required to be repaid in full in March, 2001. Borrowings under the
Credit Facility, including revolving loans and up to $20,000 in letters of
credit, are limited to the lesser of (i) the "total commitment" which initially
was $100,000 and (ii) an amount equal to the sum of (a) up to 60% of eligible
inventory (valued at the lesser of FIFO cost or current market) and (b) the
"supplemental availability" which initially was $45,000. Each of the total
commitment and the supplemental availability will be reduced by $1,250 per
quarter, commencing December 31, 1996. The interest rates on borrowings under
the Credit Facility are, at Jitney-Jungle's option, a function of the bank's
prime rate or LIBOR. The weighted average interest rate of loans under the
Credit Facility was 8.62% at April 27, 1996 and 8.44% at May 3, 1997. The
agreement requires Jitney-Jungle to pay a facility fee at an annual rate of .50%
(.25% subsequent to March 31, 1997) of the unused amount available under the
Credit Facility. Letters of credit aggregating $10,481 were outstanding as of
April 27, 1996 and May 3, 1997 under the Credit Facility.
The Senior Notes are guaranteed on a full, unconditional and joint and
several basis by each of Jitney-Jungle's subsidiaries. The Credit Facility is
guaranteed by each of Jitney-Jungle's subsidiaries. In addition, obligations
under the Credit Facility are secured by a first lien on all of Jitney-Jungle's
and its subsidiaries' assets.
The Credit Facility and the Indenture pursuant to which the Senior Notes
were issued contain numerous covenants which, among other things, restrict or
limit the incurrence of indebtedness, payments of dividends and distributions,
and capital expenditures. The Credit Facility also contains numerous financial
covenants, the more significant of which relate to leverage ratio, interest
coverage ratio and cash flows. As of May 3, 1997 Jitney-Jungle was in compliance
with the covenants under its debt agreements.
F-14
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
8. INCOME TAXES
Income taxes were composed of the following:
<TABLE>
<CAPTION>
YEAR ENDED
---------------------------------
<S> <C> <C> <C>
APRIL 29, APRIL 27, MAY 3,
1995 1996 1997
--------- ----------- ---------
Current provision................................................................. $ 9,157 $ 6,485 $ 3,913
Deferred provision (benefit)...................................................... 2,260 2,577 (3,574)
--------- ----------- ---------
Total........................................................................... $ 11,417 $ 9,062 $ 339
--------- ----------- ---------
--------- ----------- ---------
</TABLE>
The effective tax rate varied from the federal statutory rate of 35% as
follows:
<TABLE>
<CAPTION>
YEAR ENDED
-----------------------------------
<S> <C> <C> <C>
APRIL 29, APRIL 27, MAY 3,
1995 1996 1997
--------- ----------- -----------
Federal tax at statutory rate..................................................... $ 10,577 $ 8,742 $ 380
State income taxes, net of federal tax benefit.................................... 665 400 (25)
Other............................................................................. 175 (80) (16)
--------- ----------- -----
Income tax provision.............................................................. $ 11,417 $ 9,062 $ 339
--------- ----------- -----
--------- ----------- -----
</TABLE>
Deferred income tax expense relates to the following:
<TABLE>
<CAPTION>
YEAR ENDED
-----------------------------------
<S> <C> <C> <C>
APRIL 29, APRIL 27, MAY 3,
1995 1996 1997
----------- ----------- ---------
LIFO inventory................................................................... $ 1,499 $ 669 $ 773
Deferred compensation............................................................ (24) 2,290 9
Accrued estimated insurance claims............................................... (166) (285) (690)
Deferred income.................................................................. -- -- (1,567)
Property and equipment........................................................... 1,345 158 (676)
Capital leases................................................................... (448) (147) (1,004)
Other............................................................................ 54 (108) (419)
----------- ----------- ---------
Total............................................................................ $ 2,260 $ 2,577 $ (3,574)
----------- ----------- ---------
----------- ----------- ---------
</TABLE>
F-15
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
8. INCOME TAXES (CONTINUED)
The sources of temporary differences and the related deferred income tax
effects were as follows:
<TABLE>
<CAPTION>
APRIL 27, MAY 3,
1996 1997
--------- ---------
<S> <C> <C>
CURRENT DEFERRED TAX ASSETS (LIABILITIES):
LIFO inventory............................................................................ $ (1,739) $ (2,152)
Deferred compensation and compensated absences............................................ 571 562
Deferred income........................................................................... -- 1,567
Accrual of estimated insurance claims..................................................... 1,538 2,228
Other..................................................................................... 436 307
--------- ---------
Total net current deferred tax asset.................................................... $ 376 $ 2,152
--------- ---------
--------- ---------
NONCURRENT DEFERRED TAX (ASSETS) LIABILITIES:
Property and equipment.................................................................... $ 13,651 $ 12,975
Capital and closed store leases........................................................... (5,706) (6,710)
Other..................................................................................... 251 133
--------- ---------
Total net noncurrent deferred tax liability............................................. $ 8,196 $ 6,398
--------- ---------
--------- ---------
</TABLE>
Currently payable income taxes of $1,835 at May 3, 1997 are included in
accrued expenses.
Refundable income taxes of $3,890 at April 27, 1996 represent an overpayment
of estimated taxes and are included in prepaid expenses and other in the balance
sheet.
The Company's income tax returns through fiscal year 1994 have been examined
by the Internal Revenue Service.
F-16
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
9. CAPITAL STOCK
PREFERRED STOCK
Preferred stock consisted of the following:
<TABLE>
<CAPTION>
APRIL 27, 1996 MAY 3, 1997
----------------------- -----------------------
<S> <C> <C> <C> <C> <C> <C>
DIVIDEND OUTSTANDING LIQUIDATION CARRYING LIQUIDATION CARRYING
CLASS RATE SHARES PREFERENCE AMOUNT PREFERENCE AMOUNT
- --------------------------------------- ------------- ----------- ----------- ---------- ----------- ----------
A...................................... 15% 225,000 $ 22,500 $ 20,146 $ 26,722 $ 24,557
B...................................... 10% 274,460 27,446 27,446 30,685 30,685
C--Series 2............................ 10% 23,958 2,396 2,396 2,679 2,679
----------- ---------- ----------- ----------
Total Mandatorily Redeemable....................................... $ 52,342 $ 49,988 $ 60,086 $ 57,921
----------- ---------- ----------- ----------
----------- ---------- ----------- ----------
C--Series 1............................ 10% 76,042 $ 7,604 $ 7,604 $ 8,502 $ 8,502
----------- ---------- ----------- ----------
----------- ---------- ----------- ----------
</TABLE>
The excess of liquidation preference over the carrying amount of the Class A
Preferred Stock is being accreted by periodic charges to retained earnings to
the mandatory redemption date.
Dividends on Class A Preferred Stock are payable quarterly. Through March,
2001, such dividends are payable, at Jitney-Jungle's option, either by
cumulation to liquidation preference or in cash and thereafter are payable in
cash. Dividends on Class B Preferred Stock and Class C Preferred Stock cumulate
on a compounding basis until paid. Cumulative dividends not declared or paid on
preferred shares aggregated $8,642 at May 3, 1997.
The Class A Preferred Stock is redeemable at Jitney-Jungle's option, (i) at
any time after March 1, 2001 at a price equal to the then applicable liquidation
preference plus accrued and unpaid dividends and a prepayment premium or (ii) on
or prior to March 1, 1999 with the proceeds of a public offering of common stock
at a price per share equal to 114% of the then applicable liquidation preference
plus accrued and unpaid dividends thereon. All of the Class A Preferred Stock is
required to be redeemed on or before March, 2008 at a price per share equal to
the then applicable liquidation preference, plus accrued and unpaid dividends
thereon.
The Class B Preferred Stock and Class C Preferred Stock, Series 2, are
redeemable at Jitney-Jungle's option at any time, in whole or in part, at a
price per share equal to the then applicable liquidation preference, plus
accrued and unpaid dividends. All of the Class B Preferred Stock and all of the
Class C Preferred Stock, Series 2, are required to be redeemed in March, 2010
and March, 2011, respectively, at a price per share equal to the then applicable
liquidation preference plus accrued and unpaid dividends (including cumulated
dividends). The Class C Preferred Stock, Series 1, is not redeemable by
Jitney-Jungle at any time.
Under certain conditions, as defined, Jitney-Jungle is required to offer to
repurchase all shares of preferred stock. Upon a change in control,
Jitney-Jungle is required to offer to repurchase all shares of the
F-17
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
9. CAPITAL STOCK (CONTINUED)
Class A Preferred Stock at 101% of the then applicable liquidation preference
plus accrued and unpaid dividends and all shares of Class B Preferred Stock and
all shares of Class C Preferred Stock, Series 1 and Series 2, at 100% of the
liquidation preference thereof plus accrued and unpaid dividends. In addition,
Jitney-Jungle is required to offer to apply, subject to certain limitations, net
proceeds raised through a primary issuance of securities junior to Class B
Preferred Stock to repurchase shares of Class B Preferred Stock.
Except as required by law and with respect to certain specified matters,
Class A Preferred Stock has no voting rights. Neither the Class B Preferred
Stock nor the Class C Preferred Stock has any voting rights, except as required
by law.
The Class A Preferred Stock is exchangeable (with cumulated dividends) at
Jitney-Jungle's option, in whole but not in part, for subordinated exchange
debentures of Jitney-Jungle. The exchange debentures will pay interest from the
date of the exchange at the rate of 15% per annum, consisting of, at Jitney-
Jungle's option, additional exchange debentures or cash on or prior to March
2001 and cash thereafter. The exchange debentures will mature in March 2008.
Class A Preferred Stock ranks senior to Class B Preferred Stock and Class C
Preferred Stock in right of payment of cash dividends, liquidation preference
and redemption (both mandatory and optional). The Class C Preferred Stock ranks
junior to the Class B Preferred Stock in right of such cash payments.
The Credit Facility and the Indenture (See Note 7) restrict Jitney-Jungle's
ability to pay cash dividends, exchange Class A Preferred Stock for exchange
debentures and redeem or repurchase Class A Preferred Stock, Class B Preferred
Stock, Class C Preferred Stock and exchange debentures.
WARRANTS
Warrants to purchase 75,000 shares of common stock were issued in
conjunction with the Merger (See Note 2) and were outstanding as of April 27,
1996 and May 3, 1997. The warrants were recorded at fair value of $881 at date
of issue. The warrants have an exercise price of $.01 per share and will expire
in 2008.
10. EMPLOYEE BENEFIT AND COMPENSATION PLANS
Jitney-Jungle has a profit-sharing plan covering substantially all employees
with one or more years' service. Contributions are made at the discretion of the
Board of Directors of Jitney-Jungle and totaled $1,200 in fiscal 1995, 1996, and
1997.
Prior to March 1996, Jitney-Jungle had a Phantom Stock Plan for certain key
officers whereby deferred compensation units (expressed in shares of common
stock) were earned to the extent that performance targets (expressed in terms of
growth in stockholders' equity) were met. The amounts payable in accordance with
the provisions of the Phantom Stock Plan became fully vested and immediately
payable at the time of the Merger and Recapitalization (see Note 2). Effective
with the Merger, $4,252 was paid to the participants and $712 was applied
against the purchase price for shares of Class C Preferred Stock acquired by
them in connection with the Recapitalization.
F-18
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
10. EMPLOYEE BENEFIT AND COMPENSATION PLANS (CONTINUED)
Effective with the Recapitalization, the Phantom Stock Plan was amended and
restated and renamed the Deferred Compensation Plan for Jitney-Jungle Stores of
America, Inc. Under the amended plan no further awards may be made and no other
individuals will become participants. Units credited to the participants consist
of a cash amount payable in accordance with the terms of the Phantom Stock Plan
before its amendment and an amount that will continue to be credited under the
terms of the plan to an account, the value of which will be equal to the value
of the number of shares of Class C Preferred Stock of Jitney-Jungle that could
be acquired with that amount.
With respect to the amounts that continue to be credited under the plan as
amended, an amount equal to the amount of any cash dividends that would have
been paid on the number of shares of preferred stock credited to each
participant's account will be paid to the participant at the same time as any
cash dividends actually are paid on the preferred stock. Payment otherwise will
be made under the amended plan at the same time as the preferred stock is
redeemed, in an amount equal to the redemption price times the number (or
proportionate number, in the event of a partial redemption) of shares of
preferred stock credited to the participant's account.
11. SPECIAL CHARGES
Included in special charges is approximately $1,779 attributable to the
employment agreement with Jitney-Jungle's then Chairman and Chief Executive
Officer who, in January 1997, relinquished his position and duties as Chief
Executive Officer. Payments to be made under the employment agreement were
deemed to not relate to future services to be provided by the Chairman and,
accordingly, such amounts were charged to expense in fiscal 1997.
Special charges also include termination and retirement benefits payable to
employees whose positions were eliminated.
12. FAIR VALUES OF FINANCIAL INSTRUMENTS
In accordance with Statement of Financial Accounting Standards (SFAS) No.
107, "Disclosures About Fair Value of Financial Instruments", information is
provided about the fair value of certain financial instruments for which it is
practicable to estimate that value. The fair value amounts disclosed represent
management's best estimate of fair value. In accordance with SFAS No. 107, this
disclosure excludes certain financial instruments and all nonfinancial
instruments. The aggregate fair value amounts presented are not intended to
represent the underlying aggregate fair value of Jitney-Jungle.
The estimated fair values are significantly affected by assumptions used,
principally the timing of future cash flows, the discount rate, judgments
regarding current economic conditions, risk characteristics of various financial
instruments and other factors. Because assumptions are inherently subjective in
nature, the estimated fair values cannot be substantiated by comparison to
independent quotes and, in many cases, the estimated fair values could not
necessarily be realized in an immediate sale or settlement of the instrument.
The following methods and assumptions were used by Jitney-Jungle in estimating
fair value disclosures for financial instruments:
F-19
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
12. FAIR VALUES OF FINANCIAL INSTRUMENTS (CONTINUED)
CASH AND CASH EQUIVALENTS: The carrying amount reported in the balance
sheet approximates fair value.
INVESTMENTS IN DEBT SECURITIES: The securities are carried at fair value
and are based on quoted market prices.
RECEIVABLES, ACCOUNTS PAYABLE AND ACCRUED EXPENSES: The carrying amount
reported in the balance sheet approximates fair value.
LONG-TERM DEBT: The fair value of Jitney-Jungle's Senior Notes is based on
quoted market prices. The interest rates on borrowings under the Credit Facility
reset periodically. Consequently, the carrying value of borrowings under the
Credit Facility approximates fair value.
REDEEMABLE PREFERRED STOCK: The fair value of redeemable preferred stock is
estimated at carrying value as such stock is not traded in the open market and a
market price is not readily available.
The carrying amounts and fair values of Jitney-Jungle's financial
instruments were as follows:
<TABLE>
<CAPTION>
APRIL 27, 1996 MAY 3, 1997
-------------------- --------------------
<S> <C> <C> <C> <C>
CARRYING FAIR CARRYING FAIR
AMOUNT VALUE AMOUNT VALUE
--------- --------- --------- ---------
Cash and cash equivalents............................................. $ 5,676 $ 5,676 $ 14,426 14,426
Investments in debt securities........................................ 337 337
Receivables........................................................... 4,892 4,892 5,463 5,463
Accounts payable...................................................... 40,008 40,008 49,978 49,978
Accrued expenses...................................................... 23,165 23,165 33,088 33,088
Long-term debt:
Senior Notes........................................................ 200,000 204,700 200,000 217,000
Credit Facility..................................................... 39,059 39,059 8,000 8,000
Redeemable preferred stock............................................ 49,988 49,988 57,921 57,921
</TABLE>
13. ACCOUNTING STANDARD TO BE ADOPTED IN THE FUTURE
In February 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 128, "Earnings Per Share." The new
standard changes, the presentation and method in which earnings per share are
computed and is effective for Jitney-Jungle's year ending May 2, 1998. The new
standard will be applied on a "retroactive restatement of all prior periods"
basis. Jitney-Jungle is currently in the process of ascertaining the impact the
new standard will have on its earnings per share amounts for fiscal 1997 and
prior periods.
F-20
<PAGE>
JITNEY-JUNGLE STORES OF AMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED APRIL 29, 1995, APRIL 27, 1996 AND MAY 3, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
14. COMMITMENTS AND CONTINGENCIES
Jitney-Jungle is defendant in certain litigation incurred in the normal
course of business. Management, after consulting legal counsel, is of the
opinion that the liability, if any, which may result from this litigation will
not have a material adverse effect on Jitney-Jungle's financial position or
results of operations.
In 1996, Jitney-Jungle entered into a five-year supply agreement, which
replaced a previously existing agreement, relating to merchandise purchases for
stores located in Memphis, Tennessee and Little Rock and Pine Bluff, Arkansas.
In fiscal 1997, Jitney-Jungle sold the operating assets of its bakery
subsidiary for $750 and received $5,250 as consideration for entering into a
five-year supply agreement with the purchaser of such operating assets. The
$5,250 is being amortized over the term of the supply agreement.
In connection with the Merger and Recapitalization, Jitney-Jungle entered
into an agreement whereby the Fund Manager is entitled to receive $250 per year
from Jitney-Jungle as a management fee for the performance of strategic and
financial planning services. The amount of the annual management fee may be
increased by up to an additional $750 per year based upon certain performance
criteria. Management fees for fiscal year 1997 approximated $250.
15. SUBSEQUENT EVENTS
On June 3, 1997, Jitney-Jungle entered into a $12,996 insurance premium
finance agreement payable in monthly installments of $473, including interest at
6.75% per annum.
On July 8, 1997, Jitney-Jungle entered into a merger agreement with
Delchamps, Inc. ("Delchamps") which operates retail supermarkets in Alabama,
Florida, Louisiana and Mississippi. Pursuant to the agreement, Jitney-Jungle has
commenced an all-cash tender offer for all of Delchamps' outstanding common
stock at a price of $30 per share. The offer is conditioned upon, among other
things, there being tendered and not withdrawn prior to the expiration date of
the offer at least two-thirds of the outstanding shares of Delchamps' common
stock. In addition, regulatory approval and consent of the holders of Jitney-
Jungle's senior notes are required. Jitney-Jungle intends to issue up to $280
million of debt to finance the acquisition and to repay indebtedness of
Delchamps in connection with the acquisition.
16. INTERIM FINANCIAL DATA
The unaudited consolidated balance sheet as of July 26, 1997 and the related
unaudited consolidated statements of earnings and of cash flows for the 12 weeks
ended July 20, 1996 and July 26, 1997 have been prepared in accordance with the
accounting policies in effect as of May 3, 1997 as set forth in the annual
consolidated financial statements. In the opinion of management, such interim
financial statements contain all adjustments (all of which are normal and
recurring in nature) necessary to present fairly Jitney-Jungle's consolidated
financial position, results of operations and cash flows.
The results of operations for the 12 weeks ended July 26, 1997 are not
necessarily indicative of results to be expected for the full year.
F-21
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Stockholders of:
Delchamps, Inc.:
We have audited the accompanying consolidated balance sheets of Delchamps,
Inc. and subsidiary as of June 28, 1997 and June 29, 1996, and the related
consolidated statements of earnings, stockholders' equity, and cash flows for
each of the years in the three-year period ended June 28, 1997. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Delchamps,
Inc. and subsidiary at June 28, 1997 and June 29, 1996 and the results of their
operations and their cash flows for each of the years in the three-year period
ended June 28, 1997, in conformity with generally accepted accounting
principles.
KPMG PEAT MARWICK L.L.P.
August 8, 1997
Atlanta, Georgia
F-22
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
JUNE 29, 1996 JUNE 28, 1997
------------- -------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents (2)............................................................... $ 10,503 $ 5,670
Trade and other accounts receivable......................................................... 8,422 7,961
Merchandise inventories (3 and 6)........................................................... 90,797 89,726
Prepaid expenses............................................................................ 1,376 2,094
Income taxes receivable (10)................................................................ 764 --
Deferred income taxes (10).................................................................. 3,878 6,525
------------- -------------
Total current assets.................................................................... 115,740 111,976
PROPERTY AND EQUIPMENT (4):
Land........................................................................................ 15,210 13,744
Buildings and improvements.................................................................. 58,111 59,079
Fixtures and equipment...................................................................... 221,090 233,542
Construction in progress.................................................................... 9,771 2,626
------------- -------------
304,182 308,991
Less accumulated depreciation and amortization.............................................. 166,931 179,672
------------- -------------
Net property and equipment.............................................................. 137,251 129,319
OTHER ASSETS.................................................................................... 2,192 2,166
------------- -------------
TOTAL ASSETS.................................................................................... $ 255,183 $ 243,461
------------- -------------
------------- -------------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current installments of obligations under capital leases (4)................................ $ 749 $ 844
Current installments of long-term debt (5).................................................. 3,760 3,697
Notes payable (6)........................................................................... 14,000 4,600
Restructure obligation (12)................................................................. 3,996 2,273
Accounts payable............................................................................ 48,308 41,571
ACCRUED EXPENSES:
Salaries and wages.......................................................................... 4,603 7,026
Licenses and other taxes.................................................................... 8,017 7,778
Other....................................................................................... 10,240 14,192
------------- -------------
Total accrued expenses...................................................................... 22,860 28,996
Income taxes(10)............................................................................ -- 885
------------- -------------
Total current liabilities................................................................... 93,673 82,836
Obligations under capital leases, excluding current installments (4)............................ 10,398 9,556
Long-term debt, excluding current installments (5).............................................. 10,839 7,142
Restructure obligation, excluding current installments (12)..................................... 15,668 13,453
Deferred income taxes (10)...................................................................... 9,225 10,211
Other liabilities............................................................................... 2,455 2,244
------------- -------------
Total liabilities........................................................................... 142,258 125,442
------------- -------------
STOCKHOLDERS' EQUITY (5 and 11):
Junior participating preferred stock of no par value. Authorized 5,000,000 shares; no shares
issued..................................................................................... -- --
Common stock of $.01 par value. Authorized 25,000,000 shares; issued 7,112,320 shares at
June 29, 1996 and 7,121,749 shares at June 28, 1997........................................ 71 71
Additional paid-in capital.................................................................. 19,657 19,856
Retained earnings........................................................................... 93,359 98,182
------------- -------------
113,087 118,109
Less:
Unamortized restricted stock award compensation (8)..................................... (162) (90)
------------- -------------
Total stockholders' equity.............................................................. 112,925 118,019
Commitments and contingencies (4, 9, and 13)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY...................................................... $ 255,183 $ 243,461
------------- -------------
------------- -------------
</TABLE>
See notes to consolidated financial statements.
F-23
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF EARNINGS
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
YEAR ENDED
----------------------------------------
JULY 1, JUNE 29, JUNE 28,
1995 1996 1997
------------ ------------ ------------
<S> <C> <C> <C>
Sales................................................................... $ 1,054,088 $ 1,126,629 $ 1,102,947
Cost of Sales (3)....................................................... 798,537 863,389 830,878
Gross profit.......................................................... 255,551 263,240 272,069
Selling, general and administrative expenses ("SG&A"):
Restructuring charge (12)............................................. 28,779 -- --
Other SG&A............................................................ 261,763 250,121 254,282
Total SG&A............................................................ 290,542 250,121 254,282
Operating income (loss)............................................. (34,991) 13,119 17,787
Other (expense) income:
Interest expense...................................................... (5,375) (7,169) (5,215)
Interest income....................................................... 100 349 233
------------ ------------ ------------
Total other (expense) income............................................ (5,275) (6,820) (4,982)
Earnings (loss) before income taxes..................................... (40,266) 6,299 12,805
Income tax expense (benefit) (10)....................................... (14,600) 2,447 4,851
------------ ------------ ------------
Net earnings (loss)................................................. $ (25,666) $ 3,852 $ 7,954
------------ ------------ ------------
------------ ------------ ------------
Net earnings (loss) per common share.................................... $ (3.61) $ 0.54 $ 1.12
------------ ------------ ------------
------------ ------------ ------------
Weighted average number of common shares................................ 7,113 7,110 7,116
------------ ------------ ------------
------------ ------------ ------------
</TABLE>
See notes to consolidated financial statements.
F-24
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
COMMON STOCK
ISSUED ADDITIONAL
------------------------ PAID-IN RETAINED GUARANTEED STOCK STOCKHOLDERS'
SHARES AMOUNT CAPITAL EARNINGS ESOP DEBT AWARDS EQUITY
----------- ----------- ----------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Balances at July 2, 1994............ 7,114 $ 71 $ 19,731 $ 121,434 $ (4,000) $ (936) $ 136,300
Amortization of restricted stock
awards............................ -- -- -- -- -- 539 539
Retirement of restricted stock
awards............................ (5) -- (128) -- -- 128 --
Reduction of guaranteed ESOP debt... -- -- -- -- 2,000 -- 2,000
Net loss............................ -- -- -- (25,666) -- -- (25,666)
Dividends declared of $.44 per
share............................. -- -- -- (3,131) -- -- (3,131)
----- --- ----------- ----------- ----------- ----------- -------------
Balances at July 1, 1995............ 7,109 71 19,603 92,637 (2,000) (269) 110,042
Amortization of restricted stock
awards............................ -- -- -- -- -- 21 21
Retirement of restricted stock
awards............................ (3) -- (86) -- -- 86 --
Reduction of guaranteed ESOP debt... -- -- -- -- 2,000 -- 2,000
Issuance of shares for director
compensation...................... 4 -- 108 -- -- -- 108
Stock options exercised (14)........ 2 -- 32 -- -- -- 32
Net earnings........................ -- -- -- 3,852 -- -- 3,852
Dividends declared of $.44 per
share............................. -- -- -- (3,130) -- -- (3,130)
----- --- ----------- ----------- ----------- ----------- -------------
Balances at June 29, 1996........... 7,112 71 19,657 93,359 -- (162) 112,925
Amortization of restricted stock
awards............................ -- -- -- -- -- 72 72
Issuance of shares for director
compensation...................... 8 -- 167 -- -- -- 167
Stock options exercised (14)........ 2 -- 32 -- -- -- 32
Net earnings........................ -- -- -- 7,954 -- -- 7,954
Dividends declared of $.44 per
share............................. -- -- -- (3,131) -- -- (3,131)
----- --- ----------- ----------- ----------- ----------- -------------
Balances at June 28, 1997........... 7,122 $ 71 $ 19,856 $ 98,182 $ -- $ (90) $ 118,019
----- --- ----------- ----------- ----------- ----------- -------------
----- --- ----------- ----------- ----------- ----------- -------------
</TABLE>
See notes to consolidated financial statements.
F-25
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOW
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
YEAR ENDED
JULY 1, JUNE 29, JUNE 28,
1995 1996 1997
--------- ----------- ----------
<S> <C> <C> <C>
Cash flows from operating activities:
Net earnings (loss)............................................................. $ (25,666) $ 3,852 $ 7,954
Adjustment to reconcile net earnings (loss) to net cash provided by operating
activities:
Depreciation and amortization................................................... 19,472 21,771 23,719
Write-off of cost in excess of fair value of assets acquired.................... 5,050 -- --
(Gain) loss on sale of property and equipment................................... 231 (420) (2,054)
Restricted stock award amortization............................................. 667 21 72
Non cash director compensation expense.......................................... -- 108 167
Deferred income tax expense (benefit)........................................... (9,206) 1,928 (1,661)
Decrease (increase) in merchandise inventories.................................. 11,855 3,011 1,071
Increase in accounts payable, accrued expenses, and current portion of
restructure obligation........................................................ 10,887 5,567 (2,324)
Increase (decrease) in income taxes, net........................................ (6,491) 5,785 1,619
(Decrease) increase in other liabilities and restructure obligation............. 19,113 (1,653) (2,023)
Increase in other assets........................................................ (716) (890) (3,203)
--------- ----------- ----------
Net cash flows provided by operating activities................................. 25,196 39,080 23,337
--------- ----------- ----------
Cash flows from investing activities:
Additions to property and equipment............................................. (35,239) (21,671) (15,551)
Proceeds from sale of property and equipment, net............................... 611 710 4,387
--------- ----------- ----------
Net cash used in investing activities........................................... (34,628) (20,961) (11,164)
--------- ----------- ----------
Cash flows from financing activities:
Principal payments on obligation under capital leases........................... (1,576) (665) (747)
Principal payments on long-term debt and notes payable.......................... (15,333) (25,239) (26,760)
Proceeds from issuance of long-term debt and notes payable...................... 30,000 5,480 13,600
Issuance of stock options....................................................... -- 32 32
Dividends paid.................................................................. (3,131) (3,130) (3,131)
--------- ----------- ----------
Net cash (used in) provided by financing activities........................... 9,960 (23,522) (17,006)
--------- ----------- ----------
Net (decrease) increase in cash and cash equivalents............................ 528 (5,403) (4,833)
Cash and cash equivalents at beginning of year.................................. 15,378 15,906 10,503
--------- ----------- ----------
Cash and cash equivalents at end of year........................................ $ 15,906 $ 10,503 $ 5,670
--------- ----------- ----------
--------- ----------- ----------
</TABLE>
See notes to consolidated financial statements.
F-26
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. DESCRIPTION OF BUSINESS
Delchamps, Inc. and subsidiary ("Delchamps") are engaged in the business of
retail food distribution through Delchamp's supermarkets located in Alabama,
Florida, Louisiana, and Mississippi.
B. DEFINITION OF FISCAL YEAR
Delchamp's fiscal year ends on the Saturday closest to June 30. Fiscal 1995,
1996 and 1997 all comprised 52 weeks.
C. PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of Delchamps,
Inc. and its wholly owned wholesale subsidiary. All significant intercompany
balances and transactions have been eliminated in consolidation.
D. CASH EQUIVALENTS
For purposes of the consolidated statements of cash flows, the company
considers all highly liquid debt instruments purchased with a maturity of three
months or less to be cash equivalents.
E. MERCHANDISE INVENTORIES
Inventories are stated at the lower of cost or market. Cost is determined on
the last-in, first-out ("LIFO") basis for 87% in 1995, 88% in 1996 and 89% in
1997. With respect to the remaining inventories, primarily produce and market,
cost is determined on the first-in, first-out ("FIFO") basis. Inventories
developed from the retail method comprised approximately 55% of total
inventories in 1995, 58% in 1996 and 59% in 1997.
F. PROPERTY AND EQUIPMENT
Property and equipment are stated at cost. Buildings and equipment acquired
prior to July 1, 1984 are depreciated over the estimated useful lives of the
respective assets using primarily the double-declining balance method. Buildings
and equipment acquired subsequent to July 1, 1984, are depreciated over the
estimated useful lives of the respective assets using the straight-line method.
Buildings and equipment under the capital leases are stated at the lower of the
present value of the minimum lease payments at the beginning of the lease term
or fair value of the property at the inception of the lease. Assets leased under
capital leases and leasehold improvements are amortized using the straight-line
method over the lesser of the lease term or the estimated useful lives of the
related assets. Delchamps uses the following periods for depreciating and
amortizing property and equipment:
<TABLE>
<CAPTION>
10-50
Buildings............................................................... years
<S> <C>
Leasehold improvements.................................................. 10 years
Fixtures and equipment.................................................. 5-10 years
</TABLE>
F-27
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
G. COST IN EXCESS OF FAIR VALUE OF ASSETS ACQUIRED
Cost in excess of fair value of assets acquired arose from the purchase of
three supermarkets and real estate in fiscal 1988. For fiscal 1988 through 1994,
amortization was recorded over a 40 year period on a straight-line basis.
The acquired property did not achieve sales and earnings projections
prepared at the time of the acquisition. The primary cause of the short-fall in
Delchamp's projections was because of the competitors increasing promotional
activity, competitors opening new supermarkets, and competitors expanding
existing supermarkets. Delchamps determined, based on the trend of operating
results for 1988 through 1995, that the projected results of the acquired
property would not support the future amortization of the remaining balance of
the costs in excess of fair value of assets acquired. Accordingly, Delchamps
wrote-off its remaining balance of cost in excess of fair value of assets
acquired of $5.1 million in the fourth quarter of fiscal 1995.
H. INCOME TAXES
Deferred tax liabilities or assets are established for temporary differences
between financial and tax reporting bases and are subsequently adjusted to
reflect changes in tax rates expected to be in effect when the temporary
differences reverse. The major temporary differences and their net effect are
shown in the "Income Taxes" note.
Job credits are recorded as a reduction of the provision for Federal income
taxes in the year realized.
I. EARNINGS PER SHARE
Earnings per share are computed by dividing net earnings by the weighted
average number of shares of common stock outstanding.
J. MANAGEMENT ESTIMATES
Management of Delchamps has made a number of estimates and assumptions
relating to the reporting of assets and liabilities and the disclosure of
contingent assets and liabilities to prepare these financial statements in
conformity with generally accepted accounting principles. Actual results could
differ from these estimates.
K. FAIR VALUE OF FINANCIAL INSTRUMENTS
The carrying amounts of cash, accounts receivable, accounts payable, and
accrued expenses approximate fair value because of the short maturity of these
items.
The carrying amounts of the notes payable and long-term debt approximate
fair value because the interest rates in these instruments approximate market
interest rates.
L. IMPAIRMENT OF LONG-LIVED ASSETS
Effective June 30, 1996, the Company adopted the provisions of Statement of
Financial Accounting Standards No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be
F-28
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Disposed Of" ("SFAS No. 121"). SFAS No. 121 establishes accounting standards for
the impairment of long-lived assets, certain identifiable intangibles and
goodwill related to those assets to be held and used, or to be disposed of. The
implementation did not have a significant impact on the Company's financial
condition or results of operation.
(M) STOCK COMPENSATION
During fiscal 1997, Delchamps adopted Statement of Financial Accounting
Standards No. 123 ("SFAS 123"), "Accounting for Stock-Based Compensation," which
was effective for fiscal years beginning after December 15, 1995. The statement
encourages the use of a fair-value-based method of accounting for stock-based
awards under which the fair value of stock options is determined on the date of
grant and expensed over the vesting period. Companies may, however, continue to
measure compensation costs for those plans using the method prescribed by
Accounting Principles Board Opinion No. 25 ("APB No. 25"), "Accounting for Stock
Issued to Employees." Companies that continue to apply APB No. 25 are required
to include pro forma disclosures of net earnings and earnings per share as if
the fair-value-based method of accounting had been applied. Delchamps has
elected to continue to account for such plans under the provisions of APB No.
25. Compensation expense computed under the fair-value-based method is not
significant to the financial statements as a whole, therefore pro forma
disclosures have not been included.
(2) CASH EQUIVALENTS
Cash equivalents are stated at cost which approximates market value. Cash
equivalents at June 29, 1996 and June 28, 1997 consisted of the following:
<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C> <C>
1996 1997
--------- ---------
Euro Dollar Time Deposits...................................................................... $ 1,130 $ 2
Marketable Unit Investment Fund................................................................ 856 856
Cash Management Tax Exempt Fund................................................................ 20 77
--------- ---------
$ 2,006 $ 935
--------- ---------
--------- ---------
</TABLE>
(3) MERCHANDISE INVENTORIES
Delchamps uses the LIFO method of valuing certain of its merchandise
inventories to minimize inflation-induced inventory profits and to achieve a
better matching of current costs with current revenues. Inventories would
increase by approximately $13,780,000 at June 29, 1996 and $14,171,000 at June
28, 1997 if all of Delchamp's inventories were stated at cost determined by the
first-in, first-out method. Further, net earnings would increase by
approximately $322,000 in fiscal year 1995, increase $262,000 in fiscal year
1996, and increase $240,000 in fiscal year 1997, after applying Delchamp's
marginal tax rate and without assuming an investment return on the applicable
income tax savings
Delchamps is a member of a cooperative association from which it purchases
private label merchandise for resale and certain supermarket equipment.
Merchandise inventories purchased from this cooperative association approximated
19% of total inventory purchases in 1995, 1996 and 1997.
F-29
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(4) LEASES
Delchamps leases certain supermarket properties and equipment under capital
leases that expire over the next 11 years. Delchamps also leases warehouses,
store properties, and store equipment under noncancelable operating leases that
expire over the next 20 years. Contingent rentals on store properties are paid
as a percentage of sales in excess of a stipulated minimum. In the normal course
of business, it is expected that most leases will be renewed or replaced by
leases on other properties and equipment.
Included in property and equipment are the following amounts applicable to
capital leases:
<TABLE>
<CAPTION>
(IN THOUSANDS)
--------------------
<S> <C> <C>
1996 1997
--------- ---------
Buildings................................................................................... $ 13,998 $ 13,998
Fixtures and equipment...................................................................... 19,040 19,040
--------- ---------
33,038 33,038
Less accumulated amortization............................................................... 26,888 27,578
--------- ---------
$ 6,150 $ 5,460
--------- ---------
--------- ---------
</TABLE>
Future minimum lease payments under noncancelable operating leases and the
present value of future minimum capital lease payments as of June 28, 1997 are
as follows:
<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C> <C>
CAPITAL OPERATING
LEASES LEASES
--------- -----------
Fiscal Year
1998....................................................................................... $ 2,081 $ 38,292
1999....................................................................................... 2,081 37,702
2000....................................................................................... 2,081 37,081
2001....................................................................................... 2,081 34,989
2002....................................................................................... 1,961 33,766
Later years.................................................................................. 6,968 241,182
--------- -----------
</TABLE>
<TABLE>
<CAPTION>
Total minimum lease payments............................................. 17,253 $ 423,012
<S> <C> <C>
---------
---------
Less amount representing interest........................................ 6,853
---------
Present value of net minimum capital lease payments...................... 10,400
Less current installments of obligations under capital leases............ 844
---------
Long-term obligations under capital leases............................... $ 9,556
---------
---------
</TABLE>
F-30
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(4) LEASES (CONTINUED)
Rental expense and contingent rentals for operating leases are as follows:
<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C> <C> <C>
1995 1996 1997
--------- --------- ---------
Minimum rentals.................................................................. $ 43,552 $ 45,514 $ 45,329
Contingent rentals............................................................... 99 66 129
--------- --------- ---------
$ 43,651 $ 45,580 $ 45,458
--------- --------- ---------
--------- --------- ---------
</TABLE>
Most of Delchamp's leases stipulate that Delchamps pay taxes, maintenance,
insurance, and certain other operating expenses applicable to the leased
property.
(5) LONG-TERM DEBT
Long-term debt as of June 29, 1996 and June 28, 1997 consisted of the
following:
<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C> <C>
1996 1997
--------- ---------
5.51% note payable, due in 84 monthly installments of $297,619 in principal plus interest,
with the final installment due July 1, 2000, unsecured.................................... $ 14,286 $ 10,714
Note payable, with interest rates based on LIBOR + 1.5%, due in 60 monthly installments of
$15,625 in principal plus interest, with the final installment due March 1, 1998, secured
by deposit accounts with the lender....................................................... 313 125
--------- ---------
Total long-term debt........................................................................ 14,599 10,839
Less current installments................................................................... 3,760 3,697
--------- ---------
Long-term debt, excluding current installments.............................................. $ 10,839 $ 7,142
--------- ---------
--------- ---------
</TABLE>
Agreements underlying the notes payable contain restrictive covenants which
limit the payment of dividends, additional debt, lease rentals, and transactions
with affiliates, and require maintenance of certain working capital and equity
levels. At June 28, 1997, Delchamps was in compliance with all covenants. At
June 28, 1997, approximately $4,950,000 of Delchamp's retained earnings was
available for the payment of dividends under such restrictive provisions.
Cash payments for interest were approximately $5,368,000, $7,129,000 and
$5,268,000 in 1995, 1996 and 1997, respectively.
Aggregate annual maturities of long-term debt for fiscal years after June
28, 1997 are approximately as follows:
<TABLE>
<CAPTION>
(IN THOUSANDS)
FISCAL YEAR ANNUAL MATURITIES
- ----------------------------------------------------------------------------------------------- -----------------
<S> <C>
1998........................................................................................... $ 3,697
1999........................................................................................... 3,571
2000........................................................................................... 3,571
-------
$ 10,839
-------
-------
</TABLE>
F-31
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(5) LONG-TERM DEBT (CONTINUED)
Based on the borrowing rates currently available to Delchamps for long-term
debt with similar terms and maturities, the fair value of the long-term debt
outstanding at June 29, 1996 and June 28, 1997 approximated the carrying value,
with the exception of the 5.51% note payable, the fair value of which
approximated $13.7 million and $10.0 million at June 29, 1996 and June 28, 1997,
respectively. The fair value was estimated using a discounted cash flow analysis
based on Delchamps' borrowing rate for similar liabilities.
(6) NOTES PAYABLE
Short-term borrowings as of June 29, 1996 and June 28, 1997 consisted of the
following:
<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C> <C>
1996 1997
--------- ---------
Revolving loan commitments, due on various dates throughout fiscal 1996 and fiscal 1997,
respectively, with interest rates based on LIBOR + 1.25%, secured by all of Delchamps'
inventory................................................................................. $ 14,000 $ 4,600
</TABLE>
On June 29, 1995, Delchamps entered into a $75,000,000 revolving loan credit
agreement. The revolving loan agreement is committed through June, 1998. There
is an annual commitment fee of .25 of 1% on the unused portion. At Delchamps'
option, interest under the agreement may be based on LIBOR or the prime rate. As
of June 28, 1997, Delchamps is committed to a LIBOR contract which expires July
28, 1997 and has a weighted average interest rate of 6.9375%.
The credit agreement requires Delchamps to maintain minimum levels of
earnings and to comply with stated debt covenants. At June 28, 1997, Delchamps
was in compliance with all covenants.
(7) LEVERAGED EMPLOYEE STOCK OWNERSHIP PLAN
In November 1987, Delchamps leveraged its existing Employee Stock Ownership
Plan ("ESOP"). The ESOP used the proceeds of the loan to purchase approximately
1,097,000 shares of Delchamps' common stock. The common stock was held by the
ESOP trustee in a suspense account and these shares served as collateral for the
loan. Each year through fiscal 1996, Delchamps made a contribution to the ESOP
which the trustee used to make principal payments. With each loan payment a
portion of the common stock was released from the suspense account and allocated
to participating employees. Delchamps was required to pay interest on the loan
in excess of any dividends received on unallocated shares. Delchamps guaranteed
$20 million of ESOP debt under the loan agreement. On June 26, 1996, the ESOP
loan was repaid in full. Therefore, as of June 29, 1996 and June 28, 1997, all
shares had been allocated to participants and no shares remain in the "suspense
account."
F-32
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(8) EMPLOYEE BENEFIT AND INCENTIVE PLANS
Delchamps has an employee stock ownership plan and a profit sharing plan
pursuant to section 401(k) of the Internal Revenue Code (the "Code") which cover
substantially all employees who have completed two years of service. The profit
sharing plan was implemented in fiscal year 1995. Participants may contribute a
percentage of compensation, but not in excess of the maximum allowed under the
Code. The plan provides for a matching contribution by Delchamps. The total
annual contributions to these plans by Delchamps for fiscal 1995, 1996 and 1997
were as follows:
<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C> <C> <C>
1995 1996 1997
--------- --------- ---------
Employee stock ownership plan........................................................ $ 2,000 $ 2,000 $ --
Profit sharing plan.................................................................. 1,421 1,157 1,055
--------- --------- ---------
$ 3,421 $ 3,157 $ 1,055
--------- --------- ---------
--------- --------- ---------
</TABLE>
Delchamps has an incentive compensation plan for certain management
personnel tied to Delchamps' overall performance. Incentive compensation expense
was $1,252,000 in fiscal 1996 and $2,943,000 in fiscal 1997. Incentive
compensation was not paid in 1995.
In fiscal 1988, Delchamps adopted, with stockholder approval, a restricted
stock award plan. The plan provides that a maximum of 150,000 shares of common
stock be awarded to key executives. During 1989, 138,000 shares were awarded to
key executives at a price of $.01 per share. No shares have been awarded since
1989. These awarded shares are held by Delchamps for future distribution in
accordance with the provisions of the plan. Total compensation expense to be
charged to operations over the term of the plan is approximately $3,209,000.
Total compensation expense associated with the plan was determined based on the
market value of the stock at the date of award, and is being amortized on a
straight-line basis over the period the restrictions lapse. Charges to
operations for this plan were approximately $293,000 in 1995, $21,000 in 1996
and $72,000 in 1997.
(9) POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS
Delchamps provides a postemployment longevity bonus to associates that leave
employment after either attaining age 55 or completing 25 years of service. The
amount of longevity bonus is based on length of service and is recognized on an
accrual basis as employees perform services to earn the benefits. Longevity
bonus expense was $276,000 in 1995 and $304,000 in 1996 and 1997.
F-33
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(10) INCOME TAXES
The components of income tax expense (benefit) are as follows:
<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C> <C> <C>
CURRENT DEFERRED TOTAL
--------- --------- ----------
1995:
Federal........................................................................ $ (4,746) $ (8,101) $ (12,847)
State.......................................................................... (648) (1,105) (1,753)
--------- --------- ----------
$ (5,394) $ (9,206) $ (14,600)
--------- --------- ----------
--------- --------- ----------
1996:
Federal........................................................................ $ 461 $ 1,711 $ 2,172
State.......................................................................... 58 217 275
--------- --------- ----------
$ 519 $ 1,928 $ 2,447
--------- --------- ----------
--------- --------- ----------
1997:
Federal........................................................................ $ 5,750 $ (1,467) $ 4,283
State.......................................................................... 762 (194) 568
--------- --------- ----------
$ 6,512 $ (1,661) $ 4,851
--------- --------- ----------
--------- --------- ----------
</TABLE>
The actual income tax expense (benefit) differs from the statutory tax rate
for all years (computed by applying the U.S. federal corporate rate to earnings
(loss) before income taxes) as follows:
<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C> <C> <C>
1995 1996 1997
---------- ---------- ---------
Statutory tax rate.............................................................. $ (13,690) $ 2,142 $ 4,354
Increase (reduction) in income taxes resulting from:
State income taxes, net of Federal income tax benefit......................... (2,219) 270 570
Targeted jobs tax credits..................................................... (385) (25) --
Cost in excess of fair value of assets acquired............................... 1,771 -- --
Other, net.................................................................... (77) 60 (73)
---------- ---------- ---------
Actual tax expense (benefit)................................................ $ (14,600) $ 2,447 $ 4,851
---------- ---------- ---------
---------- ---------- ---------
Effective tax rate.............................................................. 36.3% 38.8% 37.9%
---------- ---------- ---------
---------- ---------- ---------
</TABLE>
F-34
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(10) INCOME TAXES (CONTINUED)
The tax effects of temporary differences that give rise to the deferred tax
assets and deferred tax liabilities are as follows:
<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C> <C>
1996 1997
--------- ---------
Deferred tax assets:
Restructure obligation..................................................................... $ 7,531 $ 6,054
Capital lease obligation................................................................... 1,939 1,901
Accrued self-insurance..................................................................... 2,879 4,515
Accrued postemployment benefits............................................................ 888 847
Other accrued liabilities.................................................................. 1,585 2,099
--------- ---------
Net deferred tax assets.................................................................... 14,797 15,416
--------- ---------
Deferred tax liabilities:
Accelerated depreciation................................................................... 19,985 18,942
Other...................................................................................... 159 160
--------- ---------
Total gross deferred liabilities........................................................... 20,144 19,102
--------- ---------
Net deferred tax liability................................................................... $ 5,347 $ 3,686
--------- ---------
--------- ---------
</TABLE>
No valuation allowance was recorded against the deferred tax assets at June
28, 1997. Delchamps' management believes the existing net deductible temporary
differences comprising the total gross deferred tax assets will reverse during
the periods in which Delchamps generates net taxable income.
Cash payments for income taxes were approximately $1,437,000, $67,000 and
$5,454,000 in fiscal 1995, 1996 and 1997, respectively.
(11) SHARE PURCHASE RIGHTS PLAN
In October 1988, Delchamps adopted a Share Purchase Rights Plan and declared
a dividend distribution of one Right for each outstanding share of common stock.
Under certain conditions, each Right may be exercised to purchase one
one-hundredth of a share of Junior Participating Preferred Stock at a purchase
price of $70, subject to adjustment. Delchamps will be entitled to redeem the
Rights at $.01 per Right at any time prior to the earlier of the expiration of
the Rights in October 1998 or ten days following the time a person or group
acquires or obtains the right to acquire a 15% position in Delchamps. The Rights
do not have voting or dividend privileges. Until such time as they become
exercisable, the Rights have no dilutive effect on the earnings per share of
Delchamps.
(12) RESTRUCTURING CHARGE
During fiscal 1995, Delchamps recorded a pretax restructuring charge of
$28.8 million. The charge reflected anticipated costs associated with a program
to close certain underperforming stores which could not be subleased in whole or
in part and, to a lesser extent, severance costs related to the termination of
employment of former executives. Of the total $28.8 million restructuring
reserve, $3.2 million, $5.9 million
F-35
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(12) RESTRUCTURING CHARGE (CONTINUED)
and $3.9 million of costs and payments have been charged against the reserve for
fiscal 1995, 1996 and 1997, respectively. A detail of charges against the
restructure obligation follows:
<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C> <C> <C>
1995 1996 1997
--------- --------- ---------
Lease payments....................................................................... $ 1,421 $ 3,438 $ 2,745
Inventory write-offs................................................................. -- 253 300
Fixture and equipment write-offs..................................................... 24 1,828 138
Severance payments................................................................... 1,752 400 755
--------- --------- ---------
$ 3,197 $ 5,919 $ 3,938
--------- --------- ---------
--------- --------- ---------
</TABLE>
(13) COMMITMENTS AND CONTINGENCIES
Delchamps is a defendant in various claims and legal actions considered to
be in the normal course of business. Management intends to vigorously defend
these claims and believes that the ultimate disposition of these matters will
not have a material adverse effect on Delchamps' consolidated financial
condition.
In fiscal 1989, and subsequently, Delchamps has entered into certain
agreements with officers and key management. The agreements contain provisions
entitling each officer or employee covered by these agreements to receive from 1
to 3 times his annual compensation (as defined) if there is a change in control
of Delchamps (as defined) and a termination of his employment. The agreements
also provide for severance benefits under certain other circumstances. The
agreements do not constitute employment contracts and only apply in
circumstances following a change in control of Delchamps. In the event of a
change in control of Delchamps and termination of all persons covered by these
agreements, the cost would be approximately $12,100,000.
(14) STOCK INCENTIVE PLAN
Key employees of Delchamps (including officers and directors who are also
full-time employees of Delchamps) are eligible to receive one or more of the
following: incentive stock options and non-qualified stock options, stock
awards, restricted stock, performance shares, and cash awards. Approximately
460,800 stock options have been granted of which approximately 351,550 shares
are exercisable as of June 28, 1997. The stock options expire from December 2000
through October 2006. During fiscal 1997, approximately 2,000 options were
exercised. Exercise prices range from $17.88 to $23.00 which was market value at
date of grant.
F-36
<PAGE>
DELCHAMPS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED JULY 1, 1995, JUNE 29, 1996 AND JUNE 28, 1997
(15) SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
Selected quarterly financial data for the years ended June 29, 1996 and June
28, 1997 is summarized as follows:
<TABLE>
<CAPTION>
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
--------------------------------------------------
<S> <C> <C> <C> <C>
FISCAL
QUARTERS
1996 FIRST SECOND THIRD FOURTH
- ------------------------------------------------------------- ---------- -------------- ---------- ----------
Sales........................................................ $ 284,689 $ 277,053 $ 280,225 $ 284,662
Gross profit................................................. 64,470 64,915 65,684 68,171
Earnings (loss) before tax................................... (1,124) 1,290 1,897 4,236
Net earnings (loss).......................................... (756) 808 1,147 2,653
Net earnings (loss) per common share......................... (0.11) 0.12 0.16 0.37
Dividends declared per common share.......................... 0.11 0.11 0.11 0.11
</TABLE>
<TABLE>
<CAPTION>
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
--------------------------------------------------
<S> <C> <C> <C> <C>
FISCAL
QUARTERS
1997 FIRST SECOND THIRD FOURTH
- ------------------------------------------------------------- ---------- -------------- ---------- ----------
Sales........................................................ $ 289,699 $ 272,602 $ 273,753 $ 266,893
Gross profit................................................. 65,367 65,116 69,182 72,404
Earnings before tax.......................................... 343 321 4,428 7,713
Net earnings................................................. 204 176 2,720 4,854
Net earnings per common share................................ .03 .03 .38 .68
Dividends declared per common share.......................... 0.11 0.11 0.11 0.11
</TABLE>
(16) SUBSEQUENT EVENT
On July 8, 1997, Delchamps announced that it had entered into an agreement
to be acquired by Jitney-Jungle Stores of America, Inc. ("Jitney-Jungle"). The
terms of the agreement are described in Delchamps' 14D-9 and in Jitney-Jungle's
14D-1, both of which have been filed with the Securities and Exchange
Commission. Pursuant to the agreement, Jitney-Jungle has begun an all-cash
tender offer for all of Delchamps' outstanding common stock at a price of $30
per share. Following successful completion of the tender offer, Jitney-Jungle
will acquire for the same cash price any shares that are not tendered by means
of a merger of Delchamps with a wholly owned subsidiary of Jitney-Jungle.
Delchamps' Board of Directors has approved the transaction unanimously and has
recommended approval by Delchamps' stockholders.
F-37
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THOSE TO WHICH IT
RELATES, NOR DOES IT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER
TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH SOLICITATION IS
UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF.
------------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information..................................................... 2
Summary................................................................... 3
Use of Proceeds........................................................... 8
Risk Factors.............................................................. 14
The Transactions.......................................................... 20
Pro Forma Capitalization.................................................. 22
Pro Forma Condensed Consolidated Financial Statements..................... 23
Pro Forma Liquidity....................................................... 35
Selected Historical Financial Information of Jitney-Jungle................ 37
Management's Discussion and Analysis of Financial Condition and Results of
Operations of Jitney-Jungle............................................. 38
Selected Historical Financial Information of Delchamps.................... 44
Management's Discussion and Analysis of Financial Condition and Results of
Operations of Delchamps................................................. 46
The Exchange Offer........................................................ 50
Business.................................................................. 56
Management................................................................ 68
Ownership of Capital Stock................................................ 74
Certain Relationships and Related Transactions............................ 78
Description of Certain Indebtedness....................................... 80
Description of the Notes.................................................. 83
Book-Entry; Delivery and Form............................................. 111
Certain Federal Income Tax Considerations................................. 113
Plan of Distribution...................................................... 114
Legal Matters............................................................. 115
Experts................................................................... 115
Index to Financial Statements............................................. F-1
</TABLE>
------------------------
UNTIL FEBRUARY 5, 1998 (90 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL
DEALERS EFFECTING TRANSACTIONS IN THE NOTES, WHETHER OR NOT PARTICIPATING IN THE
ORIGINAL DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN
ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS
UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.
PROSPECTUS
$200,000,000
[LOGO]
JITNEY-JUNGLE STORES OF AMERICA, INC.
OFFER TO EXCHANGE
10 3/8% SENIOR SUBORDINATED NOTES DUE 2007
FOR ALL OUTSTANDING
10 3/8% SENIOR SUBORDINATED NOTES DUE 2007
NOVEMBER 7, 1997
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 79-48.51 of the Mississippi Business Corporation Act provides that a
Mississippi corporation may indemnify an individual made a party to a proceeding
because he is or was a director against liability incurred in the proceeding if
the individual (1) conducted himself in good faith; (2) reasonably believed (i)
in the case of conduct in his official capacity with the corporation, that his
conduct was in its best interests; and (ii) in all other cases, that his conduct
was a least not opposed to its best interests; and (3) in the case of any
criminal proceeding, he had no reasonable cause to believe his conduct was
unlawful. A corporation may indemnify a director in these circumstances only
upon specific authorization by the board of directors (or in certain
circumstances, a committee thereof) special legal counsel or by shareholders as
provided in Section 79-4-8.55. Section 79-4-8.52 of the Mississippi Business
Corporation Act provides that a Mississippi corporation must indemnify a
director who was wholly successful, on the merits or otherwise, in the defense
of any proceeding to which he was a party because he is or was a director of the
corporation against reasonable expenses incurred by him in connection with the
proceeding, unless the articles of incorporation provide otherwise.
The Articles of Incorporation of the Company provide that a director of the
Company shall not be liable to the corporation or its shareholders for money
damages for an action taken, or any failure to take any action, as a director,
except liability for: (i) the amount of a financial benefit received by a
director to which he is not entitled: (ii) an intentional infliction of harm on
the corporation or the shareholders; (ii) a violation Section 79-4-8.33 of the
Mississippi Business Corporation Act regarding unlawful distributions; or (iv)
an intentional violation of criminal law.
The bylaws of the Company provide that the Company will indemnify any person
who is a party or is threatened to be made a party to any threatened, pending or
instituted action, suit or proceedings, whether civil, criminal, administrative
or investigative by reason of the fact that he is or was a director or officer
of the Company, or is or was servicing at the request of the Company as a
director or officer of another corporation, partnership, joint venture, trust or
other enterprise, against expenses, attorneys' fees, judgments, fines and
amounts paid in settlement actually and reasonable incurred by him in connection
with such action, suit or proceeding interests of the Company, and, with respect
to any criminal action or proceeding, had no reasonable judgment, order,
settlement, conviction, or plea or nolo contendere or its equivalent, will not,
in itself, create a presumption that the person did not act in good faith and in
a manner which reasonably believed to be in or not opposed to the best interests
of the Company, and with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful. The provision does
not apply to such claims on behalf of the Company against such director or
officer.
To the extent that any person described above has been successful on the
merits or otherwise in defense of any action, suit or proceeding or in defense
of any claim, issue or matter discussed above, he shall be indemnified against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
Such indemnification under the bylaws may be made by the Company only as
authorized in each specific case upon a determination that indemnification of
the director or officer is proper under the determination shall be made, (i) by
the Board of Directors by a majority vote of a quorum consisting of directors
who were not parties to such actions, suit or proceedings, or (ii) if such
quorum is not obtainable, or even if obtainable a quorum of disinterested
directors so directs, by independent legal counsel in a written opinion, or
(iii) by the shareholders.
Expenses incurred in defending a civil or criminal action, suit or
proceeding may be paid by the Company in advance of the final disposition of
such action, suit or proceeding if authorized by the Board
II-1
<PAGE>
of Directors in a specific case upon receipt of an undertaking by or on behalf
of the director or officer to repay such amount unless it shall ultimately be
determined that he is entitled to be indemnified by the Company.
The indemnification provided by the bylaws should not be deemed exclusive of
any other rights to which a person seeking indemnification maybe e entitled
under any statute, by-law, agreement, vote of shareholders or disinterested
directors or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, and shall continue as to a
person who has ceased to be a director or officer and shall inure to the benefit
of the heirs, executors and administrators or such a person.
The Company has power to purchase and maintain insurance on behalf of any
person who is or was a director or officer of the Company, or is or was serving
at the request of the Company as a director or officer of another corporation,
partnership, joint venture, trust or other enterprise, against any lability
asserted against him or incurred by him in any such capacity, or arising out of
his status as such, whether or not the Company would have the power to indemnify
him against such liability under the provisions of the bylaws. The Company has
the power to designate an attorney for such persons, and in any event, any
officer or director must notify the Board of Directors, in writing of any
potential claim or threatened action against him in order to be entitled to
indemnification. The requisite notice must be given within a reasonable time.
The foregoing summary of the Mississippi Business Corporation Act, of the
Company's Articles of Incorporation and of the Company's Bylaws, is qualified in
its entirety by reference to the relevant provisions of the Mississippi Business
Corporation Act and by reference to the relevant provisions of the Company's
Articles of Incorporation (filed as Exhibit 3.1) and the relevant provisions of
the Company's By-laws (filed as Exhibit 3.2).
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits:
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ---------- ---------------------------------------------------------------------------------------------------------
<S> <C>
2.1 Agreement and Plan of Exchange and of Merger, dated as of November 16, 1995 by and among JJ Acquisitions
Corp. and the Company, Southern Jitney-Jungle Company, McCarty-Holman Co., Inc. and Jitney-Jungle Bakery,
Inc. (incorporated by reference to Exhibit 2.1 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ
Acquisitions Corp. filed with the Commission on February 27, 1996)*
2.2 Agreement and Plan of Merger dated as of July 8, 1997 by and among the Company, Delchamps, Inc. and Delta
Acquisition Corporation (incorporated by reference to Exhibit 2 to Form 8-K [No. 33-80833] of the Company
dated July 14, 1997)
3.1 Amended and Restated Articles of Incorporation of the Company (incorporated by reference to Exhibit 3.3
to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ Acquisitions Corp. filed with the Commission on
February 27, 1996)*
3.2 Restated by-laws of the Company (incorporated by reference to Exhibit 3.6 to Amendment No. 2 to Form S-1
[No. 33-80833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
3.3 Composite of Amended and Restated Articles of Incorporation of Delchamps, Inc. (incorporated by reference
to Exhibit 3.1 to Form 10-Q of Delchamps, Inc. for the quarter ended September 28, 1996)
</TABLE>
II-2
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ---------- ---------------------------------------------------------------------------------------------------------
<S> <C>
3.4 Composite of By-Laws of Delchamps, Inc. (incorporated by reference to Exhibit 3.2 to Form 10-Q of
Delchamps, Inc. for the quarter ended September 28, 1996)
3.5 Amended and Restated Articles of Incorporation of Interstate Jitney-Jungle Stores, Inc.
3.6 Restated By-Laws of Interstate Jitney-Jungle Stores, Inc.
3.7 Amended and Restated Articles of Incorporation of McCarty-Holman Co., Inc.
3.8 Restated By-Laws of McCarty-Holman Co., Inc.
3.9 Amended and Restated Articles of Incorporation of Southern Jitney Jungle Company
3.10 Restated By-Laws of Southern Jitney Jungle Company
3.11 Amended and Restated Articles of Incorporation of Pump And Save, Inc.
3.12 Restated By-Laws of Pump And Save, Inc.
3.13 Amended and Restated Articles of Incorporation of Supermarket Cigarette Sales, Inc.
3.14 By-Laws of Supermarket Cigarette Sales, Inc.
3.15 Amended and Restated Articles of Incorporation of Jitney-Jungle Bakery, Inc.
3.16 Restated By-Laws of Jitney-Jungle Bakery, Inc.
4.1 Indenture dated as of September 15, 1997 between the Company, the Subsidiary Guarantors and Marine
Midland Bank, as Trustee*
4.2 Registration Rights Agreement dated as of September 15, 1997 among the Company, the Subsidiary
Guarantors, Donaldson, Lufkin & Jenrette Securities Corporation and Credit Suisse First Boston*
4.3 Form of the Company's 10 3/8% Senior Subordinated Notes due 2007 (included in Exhibit 4.1)*
4.4 Revolving Credit Agreement dated September 15, 1997 by and among Fleet Capital Corporation and the
Company*
4.5 Indenture dated March 5, 1996 between the Company and Marine Midland Bank, as Trustee, relating to the
issuance and sale of $200,000,000 aggregate principal amount of 12% Senior Notes due 2006 (incorporated
by reference to Exhibit No. 4.2 to Amendment No. 2 to Form S- 1 [No. 33-80833] of JJ Acquisition Corp.
filed with the Commission on February 27, 1996)*
4.6 Warrant dated March 4, 1996 to purchase 75,000 shares of Common Stock of the Company by DLJ Merchant
Banking Partners, L.P. and related investors (incorporated by reference by Exhibit No. 4.3 to Amendment
No. 2 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ Acquisition Corp. filed with the Commission on
February 27, 1996)*
4.7 Memorandum of Agreement dated October 15, 1985 by and among the City of Jackson, Mississippi and
McCarty-Holman Co., Inc. ($3,650,000)(incorporated by reference to Exhibit No. 4.8 to Amendment No. 2 to
Form S-1 [No. 33-80833] of JJ Acquisitions corp. filed with the Commission on February 27, 1996)*
5.1 Opinion of Dechert Price & Rhoads
9.1 Voting Trust Agreement dated November 1, 1990 by and among Carolyn Holman Kroeze, as Executrix and the
parties named therein (incorporated by reference to Exhibit No. 9.1 to Amendment No. 2 to Form S-1 [No.
33-80833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ---------- ---------------------------------------------------------------------------------------------------------
<S> <C>
10.1 Purchase Agreement dated September 10, 1997 among the Company, Donaldson, Lufkin & Jenrette Securities
Corporation and Credit Suisse First Boston with respect to the 10 3/8% Senior Subordinated Notes due
2007*
10.2 Supply Agreement dated March 19, 1989 as amended by and among Fleming Companies Inc. (successor in
interest to Malone & Hyde, Inc.), the Company and Interstate Jitney-Jungle Stores, Inc. (incorporated by
reference to Exhibit No. 10.2 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ Acquisitions Corp.
filed with the Commission on February 27, 1996)*
10.3 Membership in Topco Associates, Inc. (Cooperative) by ownership of six hundred (600) shares of Common
Stock, such stock certificate being dated July 1, 1991 (incorporated by reference to Exhibit No. 10.3 to
Amendment No. 2 to Form S-1 [No. 33-80833] of JJ Acquisition Corp. filed with the Commission on February
27, 1996)*
10.4 Flour Sale Confirmation and Contract dated July 19, 1995 by and among Cargill, Incorporated and
Jitney-Jungle Bakery, Inc. (incorporated by reference to Exhibit No. 10.4 to Amendment No. 2 to Form S-1
[No. 33-808833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
10.5 Employment Agreement dated as of February 15, 1995 by and among the Company and Roger P. Friou
(incorporated by reference to Exhibit 10.6 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ
Acquisitions corp. filed with the Commission on February 27, 1996)*
10.6 Employment Agreement dated as of February 24, 1995 by and among the Company and David K. Essary
(incorporated by reference to Exhibit 10.7 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ
Acquisitions Corp. filed with the Commission on February 27, 1996)*
10.7 Employment Agreement dated as of March 5, 1996 by and among the Company and W.H. Holman, Jr.
(incorporated by reference to Exhibit 10.6 to the Company's Annual Report on Form 10-K, dated July 24,
1997)*
10.8 Employment Agreement dated as of March 5, 1996 by and among the Company and W.H. Holman, III
(incorporated by reference to Exhibit 10.7 to the Company's Annual Report on Form 10-K, dated July 24,
1997)*
10.9 Restatement and Amendment by the Entirety of the Jitney-Jungle Stores of America, Inc. and Affiliates
Profit Sharing Plan and Trust (incorporated by reference to Exhibit No. 10.8 to Amendment No. 2 to Form
S-1 [No. 33-80833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
10.10 Deferred Compensation Plan for the Company dated as of November 16, 1995 by and among the Company,
Southern Jitney-Jungle Company, Jitney-Jungle Bakery, Inc. McCarty-Holman Co., Inc. and W.H. Holman, Jr.,
Roger P. Friou and David K. Essary (incorporated by reference to Exhibit No. 10.9 to Amendment No. 2 to
Form S-1 [No. 33-80833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
10.11 Shareholders Agreement dated as of March 5, 1996 by and among DLJ Merchant Banking Partners, L.P. JJ
Acquisitions Corp., and certain other signatories party thereto (incorporated by reference to Exhibit No.
10.10 to Amendment No. 2 to Forms S-1 [No. 33-80833] of JJ Acquisitions Corp. filed with the Commission
on February 27, 1996)*
10.12 Securities Purchase and Holders Agreement dated as of March 5, 1996 by and among JJ Acquisitions Corp.,
Bruckmann, Rosser, Sherrill & Co., L.P. and other parties thereto (incorporated by reference to Exhibit
No. 10.12 to Amendment No. 2 to Form S-1 [No. 33- 80833] of JJ Acquisitions Corp. filed with the
commission on February 27, 1996)*
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ---------- ---------------------------------------------------------------------------------------------------------
<S> <C>
10.13 Registration Rights Agreement dated as of March 5, 1996 dated as of March 5, 1996 by and among the
Company and other parties named therein (incorporated by reference to Exhibit No. 10.13 to Amendment No.
2 to Form S-1 [No.33-80833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
10.14 Membership and Licensing Agreement dated August 1, 1973 between Topco Associates, Inc. and Delchamps,
Inc. and attached copy of Articles of Incorporation and By-Laws of Topco Associates, Inc. (incorporated
by reference to Exhibit 10(a) to the Registration Statement on Form S-1 [No. 2-86926] of Delchamps, Inc.)
10.15 Agreement for Termination of Employment dated as of September 19, 1997 between Delchamps, Inc. and David
W. Morrow (incorporated by reference to Exhibit 10(j) to Form 10-K of Delchamps, Inc. for the fiscal year
ended June 28, 1997)
10.16 Form of Director Indemnity Agreement of Delchamps, Inc. (incorporated by reference to Exhibit 10 to Form
10-Q of Delchamps, Inc. for the quarter ended September 28, 1996)
12.1 Statement of Ratio of Earnings to Fixed Charges*
21.1 Subsidiaries of the Company*
23.1 Consent of Dechert Price & Rhoads (included in Exhibit 5.1)
23.2 Consent of Deloitte & Touche LLP
23.3 Consent of KPMG Peat Marwick
24 Power of Attorney*
25 Statement of Eligibility and Qualification, Form T-1, of Marine Midland Bank*
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
</TABLE>
- ------------------------
* Previously filed.
(b) Financial Statement Schedules:
Schedule II--Valuation and Qualifying Accounts and Reserves
Schedules not listed above are omitted because of the absence of the
conditions under which they are required or because the information required by
such omitted schedules is set forth in the financial statements or the notes
thereto.
II-5
<PAGE>
ITEM 22. UNDERTAKINGS
(a) The undersigned registrants hereby undertake:
(1) to file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement; and
(iii) to include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
(2) that, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof; and
(3) to remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(b) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrants pursuant to the foregoing provisions, or otherwise, the
registrants have been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrants of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrants will, unless in the opinion of their counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by them is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
(c) The undersigned registrants hereby undertake to respond to requests for
information that is incorporated by reference into the prospectus pursuant to
Item 4, 10(b), 11 or 13 of this Form, within one business day of receipt of such
request, and to send the incorporated documents by first class mail or other
equally prompt means. This includes information contained in documents filed
subsequent to the effective date of the registration statement through the date
of responding to the request.
(d) The undersigned registrants hereby undertake to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired involved therein, that was not the subject of and
included in the registration statement when it became effective.
II-6
<PAGE>
SIGNATURES
JITNEY-JUNGLE STORES OF AMERICA, INC.
Pursuant to the requirements of the Securities Act of 1933, as amended, the
above-named Registrant has duly caused this Amendment No. 1 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Jackson, State of Mississippi, on the 6th day of
November, 1997.
JITNEY-JUNGLE STORES OF AMERICA, INC.
By: /s/ MICHAEL E. JULIAN
-----------------------------------------
Michael E. Julian
PRESIDENT AND CHIEF EXECUTIVE OFFICER
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to the Registration Statement has been signed below by the
following persons in the capacities indicated on November 6, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
*
- ------------------------------ Chairman of the Board
W.H. Holman, Jr.
President, Chief Executive
/s/ MICHAEL E. JULIAN Officer and Director
- ------------------------------ (Principal Executive
Michael E. Julian Officer)
Senior Vice President,
/s/ DAVID R. BLACK Chief Financial Officer
- ------------------------------ and Assistant Secretary
David R. Black (Principal Accounting
Officer)
</TABLE>
II-7
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
*
- ------------------------------ Director
Roger P. Friou
*
- ------------------------------ Director
Bruce C. Bruckmann
*
- ------------------------------ Director
Harold O. Rosser II
*
- ------------------------------ Director
Stephen C. Sherrill
*
- ------------------------------ Director
John M. Moriarty, Jr.
*
- ------------------------------ Director
Ronald E. Johnson
*
- ------------------------------ Director
Bernard E. Ebbers
*
- ------------------------------ Director
Donald Bennett
* By: /s/ DAVID R. BLACK
- ------------------------------
David R Black
Attorney-in-fact
</TABLE>
II-8
<PAGE>
INTERSTATE JITNEY-JUNGLE STORES, INC.
Pursuant to the requirements of the Securities Act of 1933, as amended, the
above-named Registrant has duly caused this Amendment No. 1 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Jackson, State of Mississippi, on the 6th day of
November, 1997.
<TABLE>
<S> <C> <C>
INTERSTATE JITNEY-JUNGLE STORES, INC.
By: /s/ MICHAEL E. JULIAN
-----------------------------------------
Michael E. Julian
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to the Registration Statement has been signed by the following
persons in the capacities indicated on November 6, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
*
- ------------------------------ Chairman of the Board
W.H. Holman, Jr.
President, Chief Executive
/s/ MICHAEL E. JULIAN Officer and Director
- ------------------------------ (Principal Executive
Michael E. Julian Officer)
Senior Vice President,
/s/ DAVID R. BLACK Chief Financial Officer
- ------------------------------ and Assistant Secretary
David R. Black (Principal Accounting
Officer)
*
- ------------------------------ Director
Roger P. Friou
*
- ------------------------------ Director
Bruce C. Bruckmann
*
- ------------------------------ Director
Harold O. Rosser II
*
- ------------------------------ Director
Stephen C. Sherrill
*
- ------------------------------ Director
John M. Moriarty, Jr.
</TABLE>
II-9
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
*
- ------------------------------ Director
Ronald E. Johnson
*
- ------------------------------ Director
Bernard E. Ebbers
*
- ------------------------------ Director
Donald Bennett
</TABLE>
*By: /s/ DAVID R. BLACK
-------------------------
David R. Black
ATTORNEY-IN-FACT
II-10
<PAGE>
MCCARTY-HOLMAN CO., INC.
Pursuant to the requirements of the Securities Act of 1933, as amended, the
above-named Registrant has duly caused this Amendment No. 1 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Jackson, State of Mississippi, on the 6th day of
November, 1997.
<TABLE>
<S> <C> <C>
MCCARTY-HOLMAN CO., INC.
By: /s/ MICHAEL E. JULIAN
-----------------------------------------
Michael E. Julian
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to the Registration Statement has been signed by the following
persons in the capacities indicated on November 6, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
*
- ------------------------------ Chairman of the Board
W.H. Holman, Jr.
President, Chief Executive
/s/ MICHAEL E. JULIAN Officer and Director
- ------------------------------ (Principal Executive
Michael E. Julian Officer)
Senior Vice President,
/s/ DAVID R. BLACK Chief Financial Officer
- ------------------------------ and Assistant Secretary
David R. Black (Principal Accounting
Officer)
*
- ------------------------------ Director
Roger P. Friou
*
- ------------------------------ Director
Bruce C. Bruckmann
*
- ------------------------------ Director
Harold O. Rosser II
*
- ------------------------------ Director
Stephen C. Sherrill
*
- ------------------------------ Director
John M. Moriarty, Jr.
*
- ------------------------------ Director
Ronald E. Johnson
</TABLE>
II-11
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
*
- ------------------------------ Director
Bernard E. Ebbers
*
- ------------------------------ Director
Donald Bennett
</TABLE>
*By: /s/ DAVID R. BLACK
-------------------------
David R. Black
ATTORNEY-IN-FACT
II-12
<PAGE>
SOUTHERN JITNEY JUNGLE COMPANY
Pursuant to the requirements of the Securities Act of 1933, as amended, the
above-named Registrant has duly caused this Amendment No. 1 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Jackson, State of Mississippi, on the 6th day of
November, 1997.
<TABLE>
<S> <C> <C>
SOUTHERN JITNEY JUNGLE COMPANY
By: /s/ MICHAEL E. JULIAN
-----------------------------------------
Michael E. Julian
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to the Registration Statement has been signed by the following
persons in the capacities indicated on November 6, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
*
- ------------------------------ Chairman of the Board
W.H. Holman, Jr.
President, Chief Executive
/s/ MICHAEL E. JULIAN Officer and Director
- ------------------------------ (Principal Executive
Michael E. Julian Officer)
Senior Vice President,
/s/ DAVID R. BLACK Chief Financial Officer
- ------------------------------ and Assistant Secretary
David R. Black (Principal Accounting
Officer)
*
- ------------------------------ Director
Roger P. Friou
*
- ------------------------------ Director
Bruce C. Bruckmann
*
- ------------------------------ Director
Harold O. Rosser II
*
- ------------------------------ Director
Stephen C. Sherrill
*
- ------------------------------ Director
John M. Moriarty, Jr.
*
- ------------------------------ Director
Ronald E. Johnson
*
- ------------------------------ Director
Bernard E. Ebbers
</TABLE>
II-13
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
*
- ------------------------------ Director
Donald Bennett
</TABLE>
By: /s/ DAVID R. BLACK
-------------------------
David R. Black
ATTORNEY-IN-FACT
II-14
<PAGE>
PUMP AND SAVE, INC.
Pursuant to the requirements of the Securities Act of 1933, as amended, the
above-named Registrant has duly caused this Amendment No. 1 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Jackson, State of Mississippi, on the 6th day of
November, 1997.
<TABLE>
<S> <C> <C>
PUMP AND SAVE, INC.
By: /s/ MICHAEL E. JULIAN
-----------------------------------------
Michael E. Julian
CHIEF EXECUTIVE OFFICER
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to the Registration Statement has been signed by the following
persons in the capacities indicated on November 6, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
*
- ------------------------------ Chairman of the Board
W.H. Holman, Jr.
/s/ MICHAEL E. JULIAN Chief Executive Officer
- ------------------------------ and Director (Principal
Michael E. Julian Executive Officer)
Senior Vice President,
/s/ DAVID R. BLACK Chief Financial Officer
- ------------------------------ and Assistant Secretary
David R. Black (Principal Accounting
Officer)
*
- ------------------------------ Director
Roger P. Friou
*
- ------------------------------ Director
Bruce C. Bruckmann
*
- ------------------------------ Director
Harold O. Rosser II
*
- ------------------------------ Director
Stephen C. Sherrill
*
- ------------------------------ Director
John M. Moriarty, Jr.
*
- ------------------------------ Director
Ronald E. Johnson
</TABLE>
II-15
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
*
- ------------------------------ Director
Bernard E. Ebbers
*
- ------------------------------ Director
Donald Bennett
</TABLE>
*By: /s/ DAVID R. BLACK
-------------------------
David R. Black
ATTORNEY-IN-FACT
II-16
<PAGE>
SUPERMARKET CIGARETTE SALES, INC.
Pursuant to the requirements of the Securities Act of 1933, as amended, the
above-named Registrant has duly caused this Amendment No. 1 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Jackson, State of Mississippi, on the 6th day of
November, 1997.
<TABLE>
<S> <C> <C>
SUPERMARKET CIGARETTE SALES, INC.
By: /s/ MICHAEL E. JULIAN
-----------------------------------------
Michael E. Julian
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to the Registration Statement has been signed by the following
persons in the capacities indicated on November 6, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
President, Chief Executive
/s/ MICHAEL E. JULIAN Officer and Director
- ------------------------------ (Principal Executive
Michael E. Julian Officer)
Senior Vice President,
/s/ DAVID R. BLACK Treasurer, Chief
- ------------------------------ Financial Officer and
David R. Black Secretary (Principal
Accounting Officer)
*
- ------------------------------ Director
W.H. Holman, Jr.
*
- ------------------------------ Director
Roger P. Friou
*
- ------------------------------ Director
Bruce C. Bruckmann
*
- ------------------------------ Director
Harold O. Rosser II
*
- ------------------------------ Director
Stephen C. Sherrill
*
- ------------------------------ Director
Carl F. Bailey
*
- ------------------------------ Director
E.E. Bishop
*
- ------------------------------ Director
William W. Crawford
</TABLE>
<TABLE>
<S> <C> <C>
/s/ DAVID R. BLACK
-----------------------------------------
David R. Black
By: ATTORNEY-IN-FACT
</TABLE>
II-17
<PAGE>
JITNEY-JUNGLE BAKERY, INC.
Pursuant to the requirements of the Securities Act of 1933, as amended, the
above-named Registrant has duly caused this Amendment No. 1 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Jackson, State of Mississippi, on the 6th day of
November, 1997.
<TABLE>
<S> <C> <C>
JITNEY-JUNGLE BAKERY, INC.
By: /s/ MICHAEL E. JULIAN
-----------------------------------------
Michael E. Julian
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to the Registration Statement has been signed by the following
persons in the capacities indicated on November 6, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
*
- ------------------------------ Chairman of the Board
W.H. Holman, Jr.
President, Chief Executive
/s/ MICHAEL E. JULIAN Officer and Director
- ------------------------------ (Principal Executive
Michael E. Julian Officer)
Senior Vice President,
/s/ DAVID R. BLACK Chief Financial Officer
- ------------------------------ and Assistant Secretary
David R. Black (Principal Accounting
Officer)
*
- ------------------------------ Director
Roger P. Friou
*
- ------------------------------ Director
Bruce C. Bruckmann
*
- ------------------------------ Director
Harold O. Rosser II
*
- ------------------------------ Director
Stephen C. Sherrill
*
- ------------------------------ Director
John M. Moriarty, Jr.
*
- ------------------------------ Director
Ronald E. Johnson
*
- ------------------------------ Director
Bernard E. Ebbers
*
- ------------------------------ Director
Donald Bennett
</TABLE>
<TABLE>
<S> <C>
/s/ DAVID R. BLACK
----------------------------------------
David R. Black
*By: ATTORNEY-IN-FACT
</TABLE>
II-18
<PAGE>
DELCHAMPS, INC.
Pursuant to the requirements of the Securities Act of 1933, as amended, the
above-named Registrant has duly caused this Amendment No. 1 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Jackson, State of Mississippi, on the 6th day of
November, 1997.
<TABLE>
<S> <C> <C>
DELCHAMPS, INC.
By: /s/ MICHAEL E. JULIAN
-----------------------------------------
Michael E. Julian
CHIEF EXECUTIVE OFFICER
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to the Registration Statement has been signed by the following
persons in the capacities indicated on November 6, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<S> <C>
Chief Executive Officer
/s/ MICHAEL E. JULIAN and Director
- ------------------------------ (Principal Executive
Michael E. Julian Officer)
Senior Vice President,
/s/ DAVID R. BLACK Treasurer, Chief
- ------------------------------ Financial Officer and
David R. Black Secretary (Principal
Accounting Officer)
</TABLE>
II-19
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ---------- ---------------------------------------------------------------------------------------------------------
<S> <C>
2.1 Agreement and Plan of Exchange and of Merger, dated as of November 16, 1995 by and among JJ Acquisitions
Corp. and the Company, Southern Jitney-Jungle Company, McCarty-Holman Co., Inc. and Jitney-Jungle Bakery,
Inc. (incorporated by reference to Exhibit 2.1 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ
Acquisitions Corp. filed with the Commission on February 27, 1996)*
2.2 Agreement and Plan of Merger dated as of July 8, 1997 by and among the Company, Delchamps, Inc. and Delta
Acquisition Corporation (incorporated by reference to Exhibit 2 to Form 8-K [No. 33-80833] of the Company
dated July 14, 1997)
3.1 Amended and Restated Articles of Incorporation of the Company (incorporated by reference to Exhibit 3.3
to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ Acquisitions Corp. filed with the Commission on
February 27, 1996)*
3.2 Restated by-laws of the Company (incorporated by reference to Exhibit 3.6 to Amendment No. 2 to Form S-1
[No. 33-80833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
3.3 Composite of Amended and Restated Articles of Incorporation of Delchamps, Inc. (incorporated by reference
to Exhibit 3.1 to Form 10-Q of Delchamps, Inc. for the quarter ended September 28, 1996)
3.4 Composite of By-Laws of Delchamps, Inc. (incorporated by reference to Exhibit 3.2 to Form 10-Q of
Delchamps, Inc. for the quarter ended September 28, 1996)
3.5 Amended and Restated Articles of Incorporation of Interstate Jitney-Jungle Stores, Inc.
3.6 Restated of By-Laws of Interstate Jitney-Jungle Stores, Inc.
3.7 Amended and Restated Articles of Incorporation of McCarty-Holman Co., Inc.
3.8 Restated of By-Laws of McCarty-Holman Co., Inc.
3.9 Amended and Restated Articles of Incorporation of Southern Jitney Jungle Company
3.10 Restated of By-Laws of Southern Jitney Jungle Company
3.11 Amended and Restated Articles of Incorporation of Pump And Save, Inc.
3.12 Restated of By-Laws of Pump And Save, Inc.
3.13 Amended and Restated Articles of Incorporation of Supermarket Cigarette Sales, Inc.
3.14 By-Laws of Supermarket Cigarette Sales, Inc.
3.15 Amended and Restated Articles of Incorporation of Jitney-Jungle Bakery, Inc.
3.16 Restated of By-Laws of Jitney-Jungle Bakery, Inc.
4.1 Indenture dated as of September 15, 1997 between the Company, the Subsidiary Guarantors and Marine
Midland Bank, as Trustee*
4.2 Registration Rights Agreement dated as of September 15, 1997 among the Company, the Subsidiary
Guarantors, Donaldson, Lufkin & Jenrette Securities Corporation and Credit Suisse First Boston*
4.3 Form of the Company's 10 3/8% Senior Subordinated Notes due 2007 (included in Exhibit 4.1)*
4.4 Revolving Credit Agreement dated September 15, 1997 by and among Fleet Capital Corporation and the
Company*
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ---------- ---------------------------------------------------------------------------------------------------------
<S> <C>
4.5 Indenture dated March 5, 1996 between the Company and Marine Midland Bank, as Trustee, relating to the
issuance and sale of $200,000,000 aggregate principal amount of 12% Senior Notes due 2006 (incorporated
by reference to Exhibit No. 4.2 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ Acquisition Corp.
filed with the Commission on February 27, 1996)*
4.6 Warrant dated March 4, 1996 to purchase 75,000 shares of Common Stock of the Company by DLJ Merchant
Banking Partners, L.P. and related investors (incorporated by reference by Exhibit No. 4.3 to Amendment
No. 2 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ Acquisition Corp. filed with the Commission on
February 27, 1996)*
4.7 Memorandum of Agreement dated October 15, 1985 by and among the City of Jackson, Mississippi and
McCarty-Holman Co., Inc. ($3,650,000)(incorporated by reference to Exhibit No. 4.8 to Amendment No. 2 to
Form S-1 [No. 33-80833] of JJ Acquisitions corp. filed with the Commission on February 27, 1996)*
5.1 Opinion of Dechert Price & Rhoads
9.1 Voting Trust Agreement dated November 1, 1990 by and among Carolyn Holman Kroeze, as Executrix and the
parties named therein (incorporated by reference to Exhibit No. 9.1 to Amendment No. 2 to Form S-1 [No.
33-80833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
10.1 Purchase Agreement dated September 10, 1997 among the Company, Donaldson, Lufkin & Jenrette Securities
Corporation and Credit Suisse First Boston with respect to the 10 3/8% Senior Subordinated Notes due
2007*
10.2 Supply Agreement dated March 19, 1989 as amended by and among Fleming Companies Inc. (successor in
interest to Malone & Hyde, Inc.), the Company and Interstate Jitney-Jungle Stores, Inc. (incorporated by
reference to Exhibit No. 10.2 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ Acquisitions Corp.
filed with the Commission on February 27, 1996)*
10.3 Membership in Topco Associates, Inc. (Cooperative) by ownership of six hundred (600) shares of Common
Stock, such stock certificate being dated July 1, 1991 (incorporated by reference to Exhibit No. 10.3 to
Amendment No. 2 to Form S-1 [No. 33-80833] of JJ Acquisition Corp. filed with the Commission on February
27, 1996)*
10.4 Flour Sale Confirmation and Contract dated July 19, 1995 by and among Cargill, Incorporated and
Jitney-Jungle Bakery, Inc. (incorporated by reference to Exhibit No. 10.4 to Amendment No. 2 to Form S-1
[No. 33-808833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
10.5 Employment Agreement dated as of February 15, 1995 by and among the Company and Roger P. Friou
(incorporated by reference to Exhibit 10.6 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ
Acquisitions corp. filed with the Commission on February 27, 1996)*
10.6 Employment Agreement dated as of February 24, 1995 by and among the Company and David K. Essary
(incorporated by reference to Exhibit 10.7 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ
Acquisitions Corp. filed with the Commission on February 27, 1996)*
10.7 Employment Agreement dated as of March 5, 1996 by and among the Company and W.H. Holman, Jr.
(incorporated by reference to Exhibit 10.6 to the Company's Annual Report on Form 10-K, dated July 24,
1997)*
10.8 Employment Agreement dated as of March 5, 1996 by and among the Company and W.H. Holman, III
(incorporated by reference to Exhibit 10.7 to the Company's Annual Report on Form 10-K, dated July 24,
1997)*
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ---------- ---------------------------------------------------------------------------------------------------------
<S> <C>
10.9 Restatement and Amendment by the Entirety of the Jitney-Jungle Stores of America, Inc. and Affiliates
Profit Sharing Plan and Trust (incorporated by reference to Exhibit No. 10.8 to Amendment No. 2 to Form
S-1 [No. 33-80833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
10.10 Deferred Compensation Plan for the Company dated as of November 16, 1995 by and among the Company,
Southern Jitney-Jungle Company, Jitney-Jungle Bakery, Inc. McCarty-Holman Co., Inc. and W.H. Holman, Jr.,
Roger P. Friou and David K. Essary (incorporated by reference to Exhibit No. 10.9 to Amendment No. 2 to
Form S-1 [No. 33-80833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
10.11 Shareholders Agreement dated as of March 5, 1996 by and among DLJ Merchant Banking Partners, L.P. JJ
Acquisitions Corp., and certain other signatories party thereto (incorporated by reference to Exhibit No.
10.10 to Amendment No. 2 to Forms S-1 [No. 33-80833] of JJ Acquisitions Corp. filed with the Commission
on February 27, 1996)*
10.12 Securities Purchase and Holders Agreement dated as of March 5, 1996 by and among JJ Acquisitions Corp.,
Bruckmann, Rosser, Sherrill & Co., L.P. and other parties thereto (incorporated by reference to Exhibit
No. 10.12 to Amendment No. 2 to Form S-1 [No. 33-80833] of JJ Acquisitions Corp. filed with the
commission on February 27, 1996)*
10.13 Registration Rights Agreement dated as of March 5, 1996 dated as of March 5, 1996 by and among the
Company and other parties named therein (incorporated by reference to Exhibit No. 10.13 to Amendment No.
2 to Form S-1 [No.33-80833] of JJ Acquisitions Corp. filed with the Commission on February 27, 1996)*
10.14 Membership and Licensing Agreement dated August 1, 1973 between Topco Associates, Inc. and Delchamps,
Inc. and attached copy of Articles of Incorporation and By-Laws of Topco Associates, Inc. (incorporated
by reference to Exhibit 10(a) to the Registration Statement on Form S-1 [No. 2-86926] of Delchamps, Inc.)
10.15 Agreement for Termination of Employment dated as of September 19, 1997 between Delchamps, Inc. and David
W. Morrow (incorporated by reference to Exhibit 10(j) to Form 10-K of Delchamps, Inc. for the fiscal year
ended June 28, 1997)
10.16 Form of Director Indemnity Agreement of Delchamps, Inc. (incorporated by reference to Exhibit 10 to Form
10-Q of Delchamps, Inc. for the quarter ended September 28, 1996)
12.1 Statement of Ratio of Earnings to Fixed Charges*
21.1 Subsidiaries of the Company*
23.1 Consent of Dechert Price & Rhoads (included in Exhibit 5.1)
23.2 Consent of Deloitte & Touche LLP
23.3 Consent of KPMG Peat Marwick
24 Power of Attorney (included on signature pages of this Registration Statement)*
25 Statement of Eligibility and Qualification, Form T-1, of Marine Midland Bank*
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
</TABLE>
- ------------------------
* Previously filed.
<PAGE>
Exhibit 3.5
STATE OF ALABAMA
I, Jim Bennett, Secretary of State of the State of Alabama, having custody of
the Great and Principal Seal of said State, do hereby certify that as appears on
file and of record in this office, the pages hereto attached, contain a true,
accurate and literal copy of the Articles of Amendment to the Articles of
Incorporation of Alabama Jitney Jungle Stores, Inc. changing the name to
Interstate Jitney Jungle Stores, Inc. as received and filed in the office of the
Secretary of State of Alabama on August 15, 1988, showing the date of amendment
as August 8, 1988, the date said instrument was filed in the office of the Judge
of Probate of Montgomery County.
In Testimony Whereof, I have hereunto set my
hand and affixed the Great Seal of the
State, at the Capitol, in the City of
Montgomery, on this day.
[SEAL]
09/05/97
--------------------------------------------
Date
/s/ Jim Bennett
--------------------------------------------
Jim Bennett Secretary of State
<PAGE>
[Illegible]
<PAGE>
[Illegible]
<PAGE>
AMENDMENT TO ARTICLES OF INCORPORATION OF
ALABAMA JITNEY JUNGLE STORES, INC.
WHEREAS, Jitney Jungle Stores, Inc. was incorporated on May 29, 1986 in
Montgomery County, Alabama, and the Articles of Incorporation were filed in the
office of the Judge of Probate of Montgomery, Alabama in Corporation Book 144,
at page 560; and
WHEREAS, the Articles of Incorporation were amended to change the corporate
name to Alabama Jitney Jungle Stores, Inc. on June 18, 1986 and the Amendment
was filed in the office of the Judge of Probate of Montgomery, Alabama in
Corporation Book 144, at page [Illegible]; and
WHEREAS, on July 5, 1988, the Board of Directors of said corporation in
accordance with Section 10-24-111 of the Code of [Illegible] Unanimous Consent
to Action, attached [Illegible] recommending to its Stockholders another
amendment to the Articles of Incorporation , to change corporate name to
Interstate Jitney Jungle Stores, Inc.; and
WHEREAS, at the special meeting of Stockholders of said corporation was
held on July 10, 1988, pursuant to the notice as [Illegible] 10-2A-11 and of
which Stockholders [Illegible] of issued and outstanding stock were present, the
Resolution attached hereto as "Exhibit B", was accordingly adopted.
THEREFORE, BE IT RESOLVED, that the name of said corporation shall be
changed to Interstate Jitney Jungle Stores, Inc.
IN WITNESS WHEREOF, this instrument has been executed this [Illegible] day
of July, 1988.
ALABAMA JITNEY JUNGLE STORES, INC.
(Now known as INTERSTATE JITNEY
JUNGLE STORES, INC.)
By: /s/ W. H. Holman, Jr.
----------------------------------
W. H. Holman, Jr.
Its: President
By: /s/ Roger P. Friou
----------------------------------
Roger P. Friou
Its: Secretary
<PAGE>
This is to verify that Exhibit "a" is a true and correct [Illegible]
executed by all of the Directors of [Illegible] Alabama Jitney Jungle Stores,
Inc., that Exhibit "B" is a true and correct copy of the Resolution unanimously
adopted by the Shareholders of said Corporation and that said resolution is duly
[Illegible] the Minute Book of said Corporation and is [ Illegible] effect.
By:/s/ Roger P. Friou
-------------------------
Roger P. Friou, Secretary
ALABAMA JITNEY JUNGLE STORES, INC.
(Now known as INTERSTATE JITNEY
JUNGLE STORES, INC.)
<PAGE>
EXHIBIT A
UNANIMOUS CONSENT TO ACTION BY THE DIRECTORS OF
ALABAMA JITNEY JUNGLE STORES, INC.
The undersigned, constituting all the Directors of Alabama Jitney Jungle
Stores, Inc. do hereby, pursuant to Article III, Section 9, of the Bylaws of
Alabama Jitney Jungle Stores, Inc., adopt the following Resolution in the name
of and on behalf of the Directors of this Corporation and without the necessity
of a meeting:
WHEREAS, this Board believes that it would be in the best interest of this
Corporation and its Stockholders to change the name of this Corporation from
Alabama Jitney Jungle Stores, Inc. to Interstate Jitney Jungle Stores, Inc.; and
WHEREAS, the Articles of Incorporation of this Corporation must be amended
to accomplish such name change;
THEREFORE, BE IT RESOLVED, that this Board hereby recommends a vote by the
Stockholders of this Corporation in favor of the following Resolution which will
be presented at the annual stockholders meeting on July 20, 1988:
"RESOLVED, that the Articles of Incorporation of this Company to be
amended to change the name thereof to Interstate Jitney Jungle
Stores, Inc.; that the proper officers of the Corporation are hereby
authorized to make, subscribe, acknowledge and execute and file or
cause to be filed, such certificate or certificates as may be
required under the laws of Alabama; and that the Board of Directors
do or cause to be done such other acts and things as in its
discretion may be necessary or advisable in connection with said
name change."
BE IT FURTHER RESOLVED, that in the event of Stockholder approval of the
Resolution set forth above and recommended by this Board of Directors, this
Board approves said amendment to the Articles of Incorporation and authorizes
all actions set forth in or authorized by the Resolution above.
The undersigned, constituting all of the Directors of Alabama Jitney
Jungle Stores, Inc., hereby execute this Unanimous
<PAGE>
Consent To Action as of this 5th day of July, 1988.
/s/ W. H. Holman, Jr. /s/ Mrs. Charline G. Holman
- ---------------------- ----------------------------------
W. H. Holman, Jr. Mrs. Charline G. Holman
/s/ W. B. McCarty, Jr. /s/ C.H. Holman, Jr.
- ---------------------- ----------------------------------
W. B. McCarty, Jr. C.H. Holman, Jr.
/s/ Roger P. Friou /s/ Anthony J. Reape
- ---------------------- ----------------------------------
Roger P. Friou Anthony J. Reape
/s/ [Illegible] /s/ Mrs. Carolyn H. Kroeze
- ---------------------- ----------------------------------
[Illegible] Mrs. Carolyn H. Kroeze
/s/ Mrs. Stephen M. Edwards
- ---------------------------
Mrs. Stephen M. Edwards
<PAGE>
[Illegible]
<PAGE>
[Illegible]
<PAGE>
STATE OF ALABAMA
I, Jim Bennett, Secretary of State of the State of Alabama, having custody of
the Great and Principal Seal of said State, do hereby certify that as appears on
file and of record in this office, the pages hereto attached, contain a true,
accurate and literal copy of the Articles of Amendment to the Articles of
Incorporation of Jitney Jungle Stores, Inc. changing the name to Alabama Jitney
Jungle Stores, Inc. as received and filed in the office of the Secretary of
State of Alabama on June 25, 1986, showing the date of amendment as June 18,
1986, the date said instrument was filed in the office of the Judge of Probate
of Montgomery County.
In Testimony Whereof, I have hereunto set my
hand and affixed the Great Seal of the
State, at the Capitol, in the City of
Montgomery, on this day.
[SEAL]
09/05/97
--------------------------------------------
Date
/s/ Jim Bennett
--------------------------------------------
Jim Bennett Secretary of State
<PAGE>
(Stamp)
RECEIVED
June 25, 1996
SECRETARY
OF STATE
CERTIFICATION OF AMENDMENT
OF
JITNEY JUNGLE STORES, INC.
STATE OF ALABAMA )
MONTGOMERY COUNTY )
I, the undersigned Walter Hobbie, Jr., Judge of Probate of Montgomery
County, Alabama, hereby certify that the Amendment of JITNEY JUNGLE STORES, INC.
has been this day filed for record in the Probate Court of Montgomery County,
Alabama, and that the Certificate of Amendment is in compliance with the
provisions of Title 10-2A-114 of the Code of Alabama.
IN WITNESS WHERE, I, the said Walter Hobbie, Jr., as Judge of Probate of
Montgomery County, Alabama, hereunto set my name and affix my seal of said
probate on this 18th day of June, 1986.
/s/ Walter Hobbie, Jr.
-----------------------------
JUDGE OF PROBATE
MONTGOMERY COUNTY, ALABAMA
<PAGE>
AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
JITNEY JUNGLE STORES, INC.
WHEREAS, on the 29th day of May, 1986, Jitney Jungle Stores, Inc. was
incorporated in Montgomery County, Alabama, in accordance with the laws of the
State of Alabama.
WHEREAS, said corporation was filed in the Office of the Judge of Probate
of Montgomery County, Alabama, in Corporation Book 144, at page 560.
WHEREAS, upon the date of incorporation the original Directors were as
follows:
1. W. H. Holman, Jr.
1306 Woodward Avenue
Muscle Shoals, Alabama 35660
2. W. B. McCarty, Jr.
1306 Woodward Avenue
Muscle Shoals, Alabama 35660
3. Anthony J. Reape
1306 Woodward Avenue
Muscle Shoals, Alabama 35660
4. Roger P. Friou
1306 Woodward Avenue
Muscle Shoals, Alabama 35660
WHEREAS, a meeting of the Board of Directors was held on June 4, 1986, at
which time the resolution to amend the Articles of Incorporation was
presented and was un[illegible].
<PAGE>
NOW, it is hereby resolved, that the name of said corporation shall be
changed to Alabama Jitney Jungle Stores, Inc., in compliance with Title
10-2A-110 of the Code of Alabama.
WHEREAS, Charlotte D. Ingram has purchased 25,000 shares of Common Stock.
THEREFORE, Charlotte D. Ingram is the sole shareholder of the said
corporation.
IN WITNESS WHEREOF, this instrument has been executed on the 5th day of
June, 1986.
JITNEY JUNGLE STORES, INC.
(NOW KNOWN AS ALABAMA JITNEY
JUNGLE STORES, INC.)
/s/ [Illegible] BY: /s/ Charlotte D. Ingram
- ---------------------- ------------------------------
WITNESS ITS:
/s/ [Illegible]
- ----------------------
WITNESS
<PAGE>
[Illegible]
<PAGE>
STATE OF ALABAMA
I, Jim Bennett, Secretary of State of the State of Alabama, having custody of
the Great and Principal Seal of said State, do hereby certify that as appears on
file and of record in this office, the pages hereto attached, contain a true,
accurate and literal copy of the Articles of Incorporation of Jitney Jungle
Stores, Inc. as received and filed in the office of the Secretary of State of
Alabama on June 9, 1986, showing the date of incorporation as May 29, 1986, the
date said instrument was filed in the office of the Judge of Probate of
Montgomery County.
In Testimony Whereof, I have hereunto set my
hand and affixed the Great Seal of the
State, at the Capitol, in the City of
Montgomery, on this day.
[SEAL]
09/05/97
--------------------------------------------
Date
/s/ Jim Bennett
--------------------------------------------
Jim Bennett Secretary of State
<PAGE>
STATE OF ALABAMA
[ILLEGIBLE], SECRETARY OF STATE, OF THE STATE OF ALABAMA, HAVING CUSTODY OF THE
GREAT AND PRINCIPAL SEAL OF SAID STATE, DO HEREBY CERTIFY THAT PURSUANT TO THE
PROVISIONS OF [ILLEGIBLE], CODE OF ALABAMA 1975, THE CORPORATE NAME
JITNEY JUNGLE STORES, INC.
[Illegible] as available based only upon an examination of the corporate records
[illegible] in that office for the exclusive use of JITNEY JUNGLE STORES,
INC. for a period of one hundred twenty days from this date. In the case
of a domestic corporation, the name of the county in which the corporation was
or is proposed to be incorporated is MONTGOMERY . I further certify that
as set out in the regulations for reservation of corporate name, the Secretary
of State's office does not assume any responsibility for the availability of the
corporate name [Illegible] nor for any duplication which might occur.
In Testimony Whereof, I have hereunto set my hand
and affixed the Great Seal of the State, at the
Capital, in the City of Montgomery on this day
MAY 29, 1986 - EXPIRES 9-27-86
/S/ [ILLEGIBLE]
----------------------------------
<PAGE>
CERTIFICATION OF INCORPORATION
OF
JITNEY JUNGLE STORES, INC.
STATE OF ALABAMA )
MONTGOMERY COUNTY )
I, the undersigned Walter Hobbie, Jr., Judge of Probate of Montgomery
County, Alabama, hereby certify that the Certificate of Incorporation of
JITNEY JUNGLE STORES, INC.
has been this day filed for record in the Probate Court of Montgomery County,
Alabama, and that the Certificate of Incorporation has been recorded in
compliance of Title 10-2A-92 of the Code of Alabama, and that the incorporators
of said corporation, their successors and assigns, constitute a body corporate
under the name set forth in said Certificate, namely:
JITNEY JUNGLE STORES, INC.
IN WITNESS WHERE, I, the said Walter Hobbie, Jr., as Judge of Probate of
Montgomery County, Alabama, hereunto set my name and affix my seal of said
probate on this 29th day of May, 1986.
/s/ Walter Hobbie, Jr.
---------------------------
JUDGE OF PROBATE
MONTGOMERY COUNTY, ALABAMA
<PAGE>
ARTICLES OF INCORPORATION
OF
JITNEY JUNGLE STORES, INC.
AN ALABAMA CORPORATION
The undersigned, in order to form a corporation under and pursuant to the
laws of the State of Alabama, hereby adopt the following Articles of
Incorporation:
NAME
FIRST: The name of the corporation is:
JITNEY JUNGLE STORES INC.
PERIOD OF DURATION
SECOND: The period for the duration of the corporation shall be perpetual.
PURPOSES
THIRD: (a) The purpose or purposes for which the corporation is organized
is the transaction of any and all lawful business for which corporations may be
organized under the Alabama Business Corporation Act including, but not limited
to: the manufacture, sale and distribution of wood products; including but not
limited to the manufacture, sale and distribution of skids, pallets, crates and
other wood products;
(b) In furtherance but not in limitation of the aforesaid purpose of this
corporation and without limitation of the [Illegible] by statute or general
rules of law, this
<PAGE>
corporation shall have the following powers in addition to others now or
hereafter conferred by law;
(1) To operate a Retail and/or whole Grocery operation for the sale and
purchase of food and non food items.
(2) To purchase, lease, or otherwise lawfully acquire and hold all
materials, fixtures, machinery, office supplies, furniture and equipment, and
other apparatus, of whatever nature, if the same shall be necessary or
incident to the business, aforesaid;
(3) To engage in the general warehousing and storage business both with
respect to products, supplies, and materials made or used in said business
and including also the warehousing or storage of any other lawful articles or
commodities;
(4) To purchase, acquire, hold, improve, sell, convey, assign, release,
mortgage, encumber, lease, hire and deal in real and personel property of
every kind and nature, including stocks and securities of other corporations
and to lend money and take securities for the payment of all sums due the
corporation and to sell, assign, and/or release such securities;
(5) To improve and operate, and to sell, convey, assign, mortgage or
lease any real estate and any personal property;
(6) To acquire the goodwill, rights and property, and to undertake the
whole or any part of the assets and liabilities of any person, firm,
association or corporation; to pay for the same in cash, the stock of
this corporation, bonds or otherwise; to hold or in any manner to dispose of
the whole or any part of the property so purchased; to conduct in any lawful
manner the [illegible] or any part of the property so purchased: to conduct
in any lawful manner the whole or any part of any business so acquired and to
exercise all the powers ncecessary or convenient is [illegible] about the
conduct and management of such business;
(7) To guarantee, purchase or otherwise acquire, hold, sell, assign
transfer, mortgage, pledge or otherwise dispose of shares of the capital
stock, bonds or other evidences of indebtedness created by other
corporations, and privileges of ownership, including the right to vote
thereon, to the [ILLEGIBLE] a natural person might or could do;
(8) To borrow money for any of the purposes of [ILLEGIBLE]
<PAGE>
hold with same rights ownership therein as may be permitted natural persons, the
shares, bonds and obligations of the corporation;
(10) To protect the business of the corporation or any part thereof by
trademarks, tradenames, or distinguishing name or title, and to acquire or to
take over the trademarks, tradenames, process formulae, patent rights,
inventions, and apparatus useful and convenient in the conduct of the said
business of the corporation;
(11) To have one or more offices and to conduct any or all of its
operations and business and to promote its objects within or without the State
of Alabama, without restrictions as to place or amount;
(12) To establish lines of credit with banking houses or elsewhere, for
the purposes hereinbefore enumerated and set forth and to incur indebtedness,
and to raise, borrow and secure the payment of money in any lawful manner,
including the issue and sale or other disposition of, bonds, warrants,
debentures, obligations, negotiable and transferable instruments, and evidences
of indebtedness of any kind whether secured by mortgage, pledge, deed of trust,
or otherwise, for the purpose of adding additional capital, or for any other
purposes in or about its business or affairs without limit as to amount except
or provided by statute, this to be done on such terms and conditions and by such
officers as said banking house or houses may require;
(13) The foregoing clauses may be construed as objects and powers and it
is hereby expressly provided that the foregoing enumerations of specific powers
shall not be held to limit or restrict in any manner the powers of the
corporation. In addition to the objects aforesaid, the corporation shall have
the power to conduct and carry on any business or activity not prohibited by
law, nor required by law to be specifically stated in these Articles; and
(14) To do any and all things herein set forth and in addition, such other
acts and things as are necessary or convenient to attainment of the purpose of
this corporation, or any of them, to the same extent as natural persons might or
could do in any part of the world, insofar as such acts are permitted to be done
by a corporation organized under the General Corporation Acts of the State of
Alabama.
DISTRIBUTIONS FROM CAPITAL SURPLUS
FOURTH: In the event that the need exists or arises the Board of Directors
may allow distributions of cash or property to be paid out of capital surplus.
Said distributions, if any,
<PAGE>
shall be made in accordance with ss. 10-2A-68, Code of Alabama (1975).
AUTHORIZED SHARES
FIFTH: The aggregate number of shares of stock which the corporation shall
have the authority to issue shall be One hundred thousand (100,000) shares of
common stock of the par value of One and No/100 ($1.00) per share.
REGISTERED OFFICE/INITIAL REGISTERED AGENT
SIXTH: The location and mailing address of the corporation's registered
office, and the name of its initial registered agent at such address are:
NAME OF INITIAL LOCATION AND MAILING
REGISTERED AGENT ADDRESS OF REGISTERED OFFICE
Randolph B. Moore, III 410 South Perry Street
Montgomery, Alabama 36102
INITIAL BOARD OF DIRECTORS
SEVENTH: The initial board of directors call consist of four (4) persons.
The names and address of the persons who shall serve as directors until the
first annual meeting of shareholders of the corporation or until the successor
or successors to such directors or directors are elected and qualified:
NAME ADDRESS
- ---- -------
W. G. HOLMAN, JR. 1306 Woodward Avenue
Muscle Shoals, Alabama 35660
<PAGE>
W. B. McCarty, Jr. 1306 Woodward Avenue
Muscle Shoals, Alabama 35660
Anthony J. Reape 1306 Woodward Avenue
Muscle Shoals, Alabama 35660
Roger P. Friou 1306 Woodward Avenue
Muscle Shoals, Alabama 35660
INCORPORATORS
EIGHTH: The names and addresses of each incorporator is
NAME ADDRESS
- ---- -------
Charlotte Ingram 410 SOUTH PERRY STREET
MONTGOMERY, ALABAMA 36102
EXECUTED on this the 29 day of May, 1984.
/s/ Charlotte Ingram
---------------------------
CHARLOTTE INGRAM
---------------------------
---------------------------
<PAGE>
[Illegible]
<PAGE>
Exhibit 3.6
RESTATED BYLAWS
OF
INTERSTATE JITNEY JUNGLE STORES, INC.
ARTICLE I. PRINCIPAL OFFICE
The principal office of the corporation in the State of Mississippi shall
be located in the City of Jackson, County of Hinds. The corporation may have
such other offices, either within or without the State of Mississippi, as the
board of directors may designate or as the business of the corporation may
require from time to time.
ARTICLE II. SHAREHOLDERS
SECTION 1. Annual Meeting. The annual meeting of the shareholders shall be
held on the third Wednesday in the month of October, in each year at the hour of
10:00 o'clock, A.M., or such other time and date as may be determined by the
directors, for the purpose of electing directors and for the transaction of such
other business as may properly come before the meeting. If the day fixed for the
annual meeting shall be a legal holiday in the State of Mississippi, such
meeting shall be held on the next succeeding business day.
If the election of directors shall not be held on the day designated
herein for any annual meeting of the shareholders, or at any adjournment
thereof, the board of directors shall cause the election to be held at a special
meeting of the shareholders as soon thereafter as conveniently may be.
SECTION 2. Special Meetings. The corporation shall hold a special meeting
of shareholders (1) on call of its board of directors or the president; or (2)
if the holders of at least ten percent (10%) of all the votes entitled to be
cast on any issue proposed to be considered at the proposed special meeting
sign, date and deliver to the corporation's secretary one or more written
demands for the meeting describing the purpose or purposes for which it is to be
held. If not otherwise fixed under applicable law, the record date for
determining shareholders entitled to demand a special meeting shall be the date
the first shareholder signs the demand.
SECTION 3. Place of Meeting. The board of directors may designate any
place, either within or without the State of Mississippi, for any annual meeting
or for any special meeting of shareholders. A valid waiver of notice signed by
all shareholders entitled to notice may designate any place, either within or
without the State of Mississippi, as the place for any annual meeting or for any
special meeting of shareholders. Unless the notice
<PAGE>
of the meeting states otherwise, shareholders' meetings shall be held at the
corporation's principal office.
SECTION 4. Notice of Meeting. The corporation shall notify shareholders of
the date, time and place of each annual and special shareholders' meeting no
fewer than ten (10) nor more than sixty (60) days before the meeting date.
Unless applicable law or the articles of incorporation require otherwise, the
corporation shall give notice only to shareholders entitled to vote at the
meeting.
Unless applicable law or the articles of incorporation require otherwise,
notice of an annual meeting need not include a description of the purpose or
purposes for which the meeting is called. Notice of a special meeting must
include a description of the purpose or purposes for which the meeting shall be
called. Only business within the purpose or purposes described in the meeting
notice may be conducted at a special shareholders' meeting.
Unless these bylaws require otherwise, if an annual or special
shareholders' meeting is adjourned to a different date, time or place, notice
need not be given of the new date, time or place if the new date, time or place
is announced at the meeting before adjournment. If a new record date for the
adjourned meeting is or must be fixed under applicable law or Article II,
Section 5 of these bylaws, however, notice of the adjourned meeting must be
given under this section to persons who are shareholders as of the new record
date.
SECTION 5. Closing of Transfer Books or Fixing of Record Date. The board
of directors of the corporation may fix the record date for one or more voting
groups in order to determine shareholders entitled to notice of a shareholders'
meeting, to demand a special meeting, to vote or to take any other action. A
record date may not be more than seventy (70) days before the meeting or action
requiring a determination of shareholders. If not otherwise fixed by law, the
record date for determining shareholders entitled to notice of and to vote at an
annual or special shareholders' meeting shall be the day before the first notice
is delivered to shareholders. If the board of directors does not fix the record
date for determining shareholders entitled to a distribution (other than one
involving a purchase, redemption or other acquisition of the corporation's
shares), it shall be the date the board of directors authorizes the
distribution. A determination of shareholders entitled to notice of or to vote
at a shareholders' meeting shall be effective for any adjournment of the meeting
unless the board of directors fixes a new record date, which it must do if the
meeting is adjourned to a date more than one hundred twenty (120) days after the
date fixed for the original meeting.
SECTION 6. Voting Lists. After fixing a record date for a meeting, the
corporation shall prepare an alphabetical list of the names of all its
shareholders who are entitled to notice of a shareholders' meeting. The list
must be arranged by voting group (and within each voting group by class or
series of shares) and show the address of and number of Shares held by each
shareholder.
2
<PAGE>
The shareholders' list must be available for inspection by any shareholder
beginning two (2) business days after notice of the meeting is given for which
the list was prepared and continuing through the meeting, at the corporation's
principal office and at the corporation's registered office in Montgomery
County, Alabama. A shareholder, his agent or attorney shall be entitled on
written demand to inspect and, subject to the requirements of applicable law, to
copy the list during regular business hours and at his expense, during the
period it shall be available for inspection. The corporation shall make the
shareholders' list available at the meeting, and any shareholder, his agent or
attorney shall be entitled to inspect the list at any time during the meeting or
any adjournment.
SECTION 7. Quorum. Shares entitled to vote as a separate voting group may
take action on a matter at a meeting only if a quorum of those shares exists
with respect to that matter. Unless the articles of incorporation or applicable
law impose other quorum requirements, a majority of the votes entitled to be
cast on the matter by a voting group, represented In person or by proxy, shall
constitute a quorum of that voting group for action on that matter but in no
event shall a quorum consist of less than one-third of the votes entitled to be
cast on the matter by the voting group. If less than a majority of the
outstanding shares are represented at a meeting, a majority of the shares so
represented may adjourn the meeting from time to time without further notice
except as may be required by Article II, Section 4 of these bylaws or by
applicable law. At such adjourned meeting at which a quorum shall be present or
represented, any business may be transacted which might have been transacted at
the meeting as originally noticed. Once a share is represented for any purpose
at a meeting, it is, unless established to the contrary, presumed present for
quorum purposes for the remainder of the meeting end for any adjournment of that
meeting unless a new record date is or must be set for that adjourned meeting.
SECTION 8. Proxies. A shareholder may appoint a proxy to vote or otherwise
act for him by signing an appointment form, either personally or by his
attorney-in-fact. An appointment of a proxy shall be effective when received by
the secretary or other officer or agent authorized to tabulate votes of the
corporation. An appointment shall be valid for eleven (11) months unless a
longer period is expressly provided in the appointment form. An appointment of a
proxy shall be revocable by the shareholder unless the appointment form
conspicuously states that it is irrevocable and the appointment shall be coupled
with an interest. Appointments coupled with an interest include the appointment
of (1) a pledgee; (2) a person who purchased or agreed to purchase the shares;
(3) a creditor of the corporation who extended it credit under terms requiring
the appointment; (4) an employee of the corporation whose employment contract
requires the appointment; or (5) a party to a voting agreement created under
applicable law.
The revocation of an appointment or the death or incapacity of the
shareholder appointing a proxy does not affect the right of the corporation to
accept the proxy's authority unless notice of the revocation, death or
incapacity shall be received by the secretary or other officer or agent
authorized to tabulate votes before the proxy exercises his authority
3
<PAGE>
under the appointment. An appointment made irrevocable because it is coupled
with an interest shall be revoked when the interest with which it is coupled is
extinguished. A transferee for value of shares subject to an irrevocable
appointment may revoke the appointment if he did not know of its existence when
he acquired the shares and the existence of the irrevocable appointment was not
noted conspicuously on the certificate representing the shares or on the
information statement for shares without certificates.
Subject to applicable law and to any express limitation on the proxy's
authority appearing on the face of the appointment form, the corporation shall
be entitled to accept the proxy's vote or other action as that of the
shareholder making the appointment.
SECTION 9. Voting of Shares. Except as provided below or unless the
articles of incorporation provide otherwise, and subject to the provisions of
Section 12 of this Article II, each outstanding share, regardless of class,
shall be entitled to one (1) vote on each matter voted on at a shareholders'
meeting. If a quorum exists when a vote is taken, action on a matter (other than
the election of directors) by a voting group shall be approved if the votes cast
within the voting group favoring the action exceed the votes cast opposing the
action, unless the articles of incorporation or applicable law require a greater
number of affirmative votes. Unless otherwise provided in the articles of
incorporation, directors shall be elected by a majority of the votes cast by the
shares entitled to vote in the election at a meeting at which a quorum is
present when the vote is taken.
SECTION 10. Voting of Shares by Certain Holders. Shares standing in the
name of another corporation may be voted by such officer, agent or proxy as the
bylaws of such corporation may prescribe, or, in the absence of such provision,
as the board of directors of such corporation may determine.
Shares of this corporation shall not be entitled to vote if they are
owned, directly or indirectly, by a second corporation, domestic or foreign, and
this corporation owns, directly or indirectly, a majority of the shares of the
second corporation entitled to vote for the directors of the second corporation,
unless a court of competent jurisdiction determines that the voting of such
shares is not for the purpose of perpetuation of management or other improper
purpose. However, in determining compliance with Sections 234 or 237 of the
Constitution of Alabama of 1901, such shares shall be counted and voted in the
manner authorized and directed by the holders of a majority of the remaining
shares. This does not limit the power of this corporation to vote any shares,
including its own shares, held by it in a fiduciary capacity.
SECTION 11. Informal Action by Shareholders. Action required or permitted
by applicable law to be taken at a shareholders' meeting may be taken without a
meeting if the action is taken by all the shareholders entitled to vote on the
action. The action must be evidenced by one or more written consents describing
the action taken, signed by all the share holders entitled to vote on the
action, and delivered to the corporation for inclusion in the minutes or filing
with the corporate records. If not otherwise determined under applicable law,
the record date for determining shareholders entitled to take action without
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a meeting shall be the date the first shareholder signs such consent. A consent
signed under this section has the effect of a meeting vote and may be described
as such in any document.
If applicable law requires that notice of proposed action be given to
nonvoting shareholders and the action is to be taken by unanimous consent of the
voting shareholders, the corporation must give its nonvoting shareholders
written notice of the proposed action at least ten (10) days before the action
is taken. The notice must contain or be accompanied by the same material that,
under applicable law, would have been required to be sent to nonvoting
shareholders in a notice of meeting at which the proposed action would have been
submitted to the shareholders for action.
SECTION 12. No Cumulative Voting. Shareholders shall not have the right to
cumulate their votes for directors nor shall the shareholders be entitled to
multiply the number of votes they are entitled to cast by the number of
directors for whom they are entitled to vote and cast the product for a single
candidate or distribute the product among two (2) or more candidates.
SECTION 13. Shares Held by Nominees. The corporation may establish a
procedure by which the beneficial owner of shares that are registered in the
name of a nominee shall be recognized by the corporation as the shareholder. The
extent of this recognition may be determined in the procedure. The procedure may
set forth: (1) the types of nominees to which it applies; (2) the rights or
privileges that the corporation recognizes in a beneficial owner; (3) the manner
in which the procedure shall be selected by the nominee; (4) the information
that must be provided when the procedure is selected; (5) the period for which
selection of the procedure shall be effective; and (6) other aspects of the
rights and duties created.
SECTION 14. Corporation's Acceptance of Votes. If the name signed on a
vote, consent, waiver or proxy appointment corresponds to the name of the
shareholder, the corporation, if acting in good faith, shall be entitled to
accept the vote, consent, waiver or proxy appointment and give it effect as the
act of the shareholder.
If the name signed on a vote, consent, waiver or proxy appointment does
not correspond to the name of its shareholder, the corporation, if acting in
good faith, shall nevertheless be entitled to accept the vote, consent, waiver
or proxy appointment and give it effect as the act of the shareholder if; (1)
the shareholder is an entity and the name signed purports to be that of an
officer or agent of the entity; (2) the name signed purports to be that of an
administrator, executor, guardian or conservator representing the shareholder
and, if the corporation requests, evidence of fiduciary status acceptable to the
corporation has been presented with respect to the vote, consent, waiver or
proxy appointment; (3) the name signed purports to be that of a receiver or
trustee in bankruptcy of the shareholder and, if the corporation requests,
evidence of this status acceptable to the corporation has been presented with
respect to the vote, consent, waiver or proxy appointment; (4) the name signed
purports to be that of a pledgee, beneficial owner or
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attorney-in-fact of the shareholder and, if the corporation requests, evidence
acceptable to the corporation of the signatory's authority to sign for the
shareholder has been presented with respect to the vote, consent, waiver or
proxy appointment; (5) two (2) or more persons are the shareholders as covenants
or fiduciaries and the name signed purports to be the name of at least one (1)
of the co-owners and the person signing appears to be acting on behalf of all
the co-owners.
The corporation shall be entitled to reject a vote, consent, waiver or
proxy appointment if the secretary or other officer or agent authorized to
tabulate votes, acting in good faith, has reasonable basis for doubt about the
validity of the signature on it or about the signatory's authority to sign for
the shareholder.
ARTICLE III. BOARD OF DIRECTORS
SECTION 1. General Powers. All corporate powers shall be exercised by or
under the authority of, and the business and affairs of the corporation managed
under the direction of, its board of directors, subject to any limitation set
forth in the articles of incorporation.
SECTION 2. Number, Election, Tenure and Qualifications. The number of
directors of the corporation shall consist of no less than four and no more than
twelve members, the number thereof to be determined by the directors from time
to time; provided, however, that the board of directors may increase or decrease
by 30 percent or less the number of directors last approved by the shareholders,
but only the shareholders may increase or decrease by more than 30 percent the
number of directors last approved by the shareholders. Notwithstanding the limit
of twelve directors set forth in the foregoing sentence, the number of directors
may be increased to more than twelve to provide for additional directors that
holders of any series or class of preferred stock are entitled to elect pursuant
to the terms thereof, as necessary. Directors are elected at the first annual
shareholders' meeting and at each annual meeting thereafter unless their terms
are staggered in the articles of incorporation. The terms of the initial
directors of the corporation expire at the first shareholders' meeting at which
directors shall be elected. The terms of all other directors expire at the next
annual shareholders' meeting following their election unless their terms shall
be staggered in the articles of incorporation. A decrease in the number of
directors does not shorten an incumbent director's term. The term of a director
elected to fill a vacancy expires at the next shareholders' meeting at which
directors shall be elected. Despite the expiration of a director's term, he
continues to serve until his successor shall be elected and qualifies or until
there shall be a decrease in the number of directors. A director need not be a
resident of this state or a shareholder of the corporation.
SECTION 3. Resignation of Directors; Removal of Directors by Shareholders.
(a) A director may resign at any time by delivering written notice to the board
of directors, to
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its chairman or to the corporation. A resignation shall be effective when the
notice is delivered unless the notice specifies a later effective date.
(b) The shareholders may remove one or more directors with or without
cause unless the articles of incorporation provide that directors may be removed
only for cause. If a director is elected by a voting group of shareholders, only
the shareholders of that voting group may participate in the vote to remove him.
If cumulative voting is authorized, a director may not be removed if the number
of votes sufficient to elect him under cumulative voting is voted against his
removal. If cumulative voting is not authorized, a director may be removed only
if the number of votes cast to remove him exceeds the number of votes cast not
to remove him. A director may be removed by the shareholders only at a meeting
called for the purpose of removing him and the meeting notice must state that
the purpose, or one (1) of the purposes, of the meeting shall be removal of the
director.
SECTION 4. Regular Meetings. Unless the articles of incorporation or these
bylaws provide otherwise, a regular meeting of the board of directors shall be
held without other notice than this bylaw immediately after, and at the same
place as, the annual meeting of shareholders. In addition, a regular meeting of
the board of directors shall be held at least once every fiscal quarter at such
time as may be fixed by resolution of the board of directors, provided notice of
any such quarterly meeting must be preceded by at least three (3) business days
notice of the date, time and place of the meeting.
SECTION 5. Special Meetings. Special meetings of the board of directors
may be called by or at the request of the chairperson of the board of directors
or any one (1) or more directors. Unless the articles of incorporation or these
bylaws provide for a longer or shorter period, special meetings of the board of
directors must be preceded by at least three (3) business days' notice of the
date, time and place of the meeting. If no place for the meeting has been
designated in the notice, the meeting shall be held at the principal office of
the corporation. The notice need not describe the purpose of the regular or
special meeting unless required by the articles of incorporation or these
bylaws.
SECTION 6. Place of Meetings. The board of directors may hold regular or
special meetings in or out of this state.
SECTION 7. Quorum. Unless the articles of incorporation or these bylaws
require a greater number, a quorum of the board of directors consists of a
majority of the number of directors in office immediately before the meeting
begins, if the corporation has a variable-range size board. If less than such
number necessary for a quorum shall be present at a meeting, a majority of the
directors present may adjourn the meeting from time to time without further
notice.
SECTION 8. Manner of Acting. If a quorum is present when a vote is taken,
the affirmative vote of a majority of directors present is the act of the board
of directors unless the articles of incorporation or bylaws require the vote of
a greater number of directors. A
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director is, unless established to the contrary, presumed present for quorum
purposes for the remainder of a meeting at which he or she has been present for
any purpose.
SECTION 9. Action Without A Meeting. Unless the articles of incorporation
or bylaws provide otherwise, action required or permitted to be taken at a board
of directors' meeting may be taken without a meeting if the action is taken by
all members of the board. The action must be evidenced by one or more written
consents describing the action taken, signed by each director, and included in
the minutes or filed with the corporate records reflecting the action taken.
Action taken under this section shall be effective when the last director signs
the consent, unless the consent specifies a different effective date. Such a
consent has the effect of a meeting vote and may be described as such in any
document.
SECTION 10. Vacancies. Unless the articles of incorporation provide
otherwise, if a vacancy occurs on the board of directors, (i) the shareholders
may fill the vacancy, whether resulting from an increase in the number of
directors or otherwise, (ii) the board of directors may fill the vacancy, except
that the directors shall have the power to fill a vacancy resulting from an
increase in the number of directors only if expressly provided for in the
articles of incorporation, or (iii) if the directors remaining in office
constitute fewer than a quorum of the board, they may fill the vacancy, if it is
one that the directors are authorized to fill, by the affirmative vote of a
majority of all the directors remaining in office. If the vacant office was held
by a director elected by a voting group of shareholders, only the holders of
shares of that voting group shall be entitled to fill the vacancy if it is
filled by the shareholders. A vacancy that will occur at a specific later date
(by reason of a resignation effective at a later date or otherwise) may be
filled before the vacancy occurs. but the new director may not take office until
the vacancy occurs.
SECTION 11. Compensation. Unless the articles of incorporation or these
bylaws provide otherwise, the board of directors may fix the compensation of
directors. By resolution of the board of directors, each director may be paid
his expenses, if any, of attendance at each meeting of the board of directors,
and may be paid a stated salary as a director or a fixed sum for attendance at
each meeting of the board of directors or both. No such payment shall preclude
any director from serving the corporation in any other capacity and receiving
compensation therefor.
SECTION 12. Executive and Other Committees. Unless the articles of
incorporation or bylaws provide otherwise, the board of directors may create an
executive committee and one or more other committees and appoint members of the
board of directors to serve on them. Each committee must have two (2) or more
members, who serve at the pleasure of the board of directors. The creation of a
committee and appointment of members to it must be approved by the greater of
(1) a majority of all the directors in office when the action is taken or (2)
the number of directors required by the articles of incorporation or bylaws to
take action. To the extent specified by the board of directors or in the
articles of incorporation or bylaws, each committee may exercise the authority
of the board of directors. A committee may not, however, authorize
distributions; approve or propose to shareholders action required by applicable
law to be approved by shareholders; fill
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vacancies on the board of directors or on any of its committees; amend articles
of incorporation, which pursuant to applicable law the board of directors are
authorized to amend; adopt, amend, or repeal bylaws; approve a plan of merger
not requiring shareholder approval; authorize or approve the reacquisition of
shares, except according to a formula or method prescribed by the board of
directors; or authorize or approve the issuance or sale or contract for sale of
shares, or determine the designation and relative rights, preferences and
limitations of a class or series of shares, except that the board of directors
may authorize a committee (or a senior executive officer of the corporation) to
do so within limits specifically prescribed by the board of directors.
Provisions of these bylaws governing meetings, action without meetings, notice
and waiver of notice, and quorum and voting requirements of the board of
directors, apply to committees and their members as well.
SECTION 13. Participation by Telephonic or Other Means. Unless the
articles of incorporation or these bylaws provide otherwise, the board of
directors may permit any or all directors to participate in a regular or
special meeting by, or conduct the meeting through the use of, any means of
communication by which all directors participating may simultaneously hear each
other during the meeting. A director participating in a meeting by this means
shall be deemed to be present in person at the meeting.
ARTICLE IV. OFFICERS
SECTION 1. Number. The officers of the corporation shall be a chairman of
the board, a president, a vice president, a secretary and a treasurer, each of
whom shall be elected by the board of directors. Such other officers, assistant
officers and agents as may be deemed necessary may be elected or appointed by
the board of directors. Any two or more offices may be held by the same person.
SECTION 2. Election and Term of Officers. The officers of the corporation
to be elected by the board of directors shall be elected annually by the board
of directors at the regular meeting of the board of directors immediately
following the annual meeting of the shareholders. If the election of officers
shall not be held at such meeting, such election shall be held as soon
thereafter as conveniently may be. Each officer shall continue to serve until
his successor is elected and qualifies or until his death or until he shall
resign or shall have been removed in the manner hereinafter provided.
SECTION 3. Resignation or Removal of Officers and Agents. (a) An officer
or agent may resign at any time by delivering written notice to the board of
directors, to its chairman or to the corporation. A resignation shall be
effective when the notice is delivered unless the notice specifies a later
effective date.
(b) Any officer or agent may be removed by the board of directors whenever
in its judgment, the best interests of the corporation will be served thereby,
but such removal shall be without prejudice to the contract rights, if any, of
the person so removed. Election or appointment of an officer or agent shall not
of itself create contract rights.
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SECTION 4. Vacancies. A vacancy in any office because of death,
resignation, removal, disqualification or otherwise, may be filled by the board
of directors for the unexpired portion of the term.
SECTION 5. Chairman of the Board. The chairman of the board shall be the
chief executive officer of the corporation and must be a member of the board of
directors at the time of election to such office. When present he shall preside
at all meetings of the shareholders and of the board of directors. He may sign,
with the president and secretary or any other proper officer of the corporation
thereunto authorized by the board of directors, any deeds, mortgages, bonds,
contracts or other instruments which the board of directors has authorized to be
executed, except in cases where the signing and execution thereof shall be
expressly delegated by the board of directors or by these bylaws to some other
officer or agent of the corporation, or shall be required by law to be otherwise
signed or executed; and in general shall perform all duties incident to the
office of chairman of the board and such other duties as may be prescribed by
the board of directors from time to time.
SECTION 6. President. The president shall be the chief operating officer
of the corporation and, subject to the control of the chairman and the board of
directors, shall have general supervision and control of the business and
affairs of the corporation. In the absence of the chairman of the board of
directors, he shall, when present, preside at all meetings of the shareholders
and of the board of directors. He may sign, with the secretary or any other
proper officer of the corporation thereunto authorized by the board of
directors, certificates for shares of the corporation, any deeds, mortgages,
bonds, contracts, or other instruments which the board of directors has
authorized to be executed, except in cases where the signing and execution
thereof shall be expressly delegated by the board of directors or by these
bylaws to some other officer or agent of the corporation, or shall be required
by law to be otherwise signed or executed; and in general shall perform all
duties incident to the office of president and such other duties as may be
prescribed by the board of directors from time to time.
SECTION 7. Vice President. In the absence of the president or in the event
of his death, inability or refusal to act, the vice president shall perform the
duties of the president, and when so acting, shall have all the powers of and be
subject to all the restrictions upon the president. The vice president shall
perform such other duties as from time to time may be assigned to him by the
president or by the board of directors.
SECTION 8. Secretary. The secretary shall (a) prepare and keep the minutes
of the directors' and shareholders' meetings in one or more books provided for
that purpose; (b) see that all notices are duly given in accordance with the
provisions of these bylaws or as required by law; (c) be custodian of the
corporate records and of the seal of the corporation and see that the seal of
the corporation is affixed to all documents the execution of which on behalf of
the corporation under its seal is duly authorized; (d) authenticate records of
the corporation; (e) keep a register of the post office address of each
shareholder which shall be furnished to the secretary by such shareholder; (f)
sign
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with the president, certificates for shares of the corporation, the issuance of
which shall have been authorized by resolutions of the board of directors; (g)
have general charge of the stock transfer books of the corporation; (h) in
general perform all duties incident to the office of secretary and such other
duties as from time to time may be assigned to him by the president or by the
board of directors.
SECTION 9. Treasurer. The treasurer shall: (a) have charge and custody of
and be responsible for all funds and securities of the corporation; (b) receive
and give receipts for monies due and payable to the corporation from any source
whatsoever, and deposit all such monies in the name of the corporation in such
banks, trust companies or other depositories as shall be selected in accordance
with these bylaws; and (C) in general perform all of the duties incident to the
office of treasurer and such other duties as from time to time may be assigned
to him by the president or by the board of directors. If required by the board
of directors, the treasurer shall give a bond for the faithful discharge of his
duties in such sum and with such surety or sureties as the board of directors
shall determine.
SECTION 10. Compensation. The board of directors may fix the compensation
of the officers. No such payment shall preclude any officer from serving the
corporation in any other capacity and receiving compensation therefor.
ARTICLE V. CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1 Contracts. The board of directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute and deliver any
instrument in the name of and on behalf of the corporation, and such authority
may be general or confined to specific instances.
SECTION 2. Loans. No loans shall be contracted on behalf of the
corporation and no evidences of indebtedness shall be issued in its name unless
authorized by a resolution of the board of directors. Such authority may be
general or confined to specific instances.
SECTION 3. Checks, Drafts, Etc. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation, shall be signed by such officer or officers, agent or agents of
the corporation and in such manner as shall from time to time be determined by
resolution of the board of directors.
SECTION 4. Deposits. All funds of the corporation not otherwise employed
shall be deposited from time to time to the credit of the corporation in such
banks, companies or other depositories as the board of directors may select.
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ARTICLE VI. CERTIFICATES FOR SHARES AND THEIR TRANSFER
SECTION 1. Certificates for Shares. Shares shall be represented by
certificates. Certificates representing shares of the corporation shall be in
such form as shall be determined by the board of directors. At a minimum, each
share certificate must state on its face (1) the name of the corporation and
that the corporation Is organized under the law of the State of Alabama; (2) the
name of the person to whom issued; and (3) the number and class of shares and
the designation of the series, if any, the certificate represents. If the
corporation is authorized to issue different classes of shares or different
series within a class, the designations, relative rights, preferences and
limitations applicable to each class and the variations in rights, preferences
and limitations determined for each series (and the authority of the board of
directors to determine variations for future series) must be summarized on the
front or back of each certificate or the corporation must furnish the
shareholder this information on request in writing and without charge.
Each share certificate must be signed (either manually or in facsimile) by
the president or a vice president and by the secretary or an assistant secretary
or by such other officers designated in the bylaws or by the board of directors
so to do, and may be sealed with the corporate seal. If the person who signed
(either manually or in facsimile) a share certificate no longer holds office
when the certificate is issued, the certificate is nevertheless valid.
All certificates for shares shall be consecutively numbered or otherwise
identified. The name and address of the person to whom the shares represented
thereby are issued, with the number of shares and date of issue, shall be
entered on the stock transfer books of the corporation. All certificates
surrendered to the corporation for transfer shall be canceled and no new
certificate shall be issued until the former certificate for a like number of
shares shall have been surrendered and canceled, except that in the case of a
lost, destroyed, or mutilated certificate a new one may be issued therefor upon
such terms and indemnity to the corporation as the board of directors may
prescribe.
SECTION 2. Transfer of Shares. Transfer of shares of the corporation shall
be made only on the stock transfer books of the corporation by the holder of
record thereof or by his legal representative, who shall furnish proper evidence
of authority to transfer, or by his attorney thereunto authorized by power of
attorney duly executed and filed with the secretary of the corporation, and on
surrender for cancellation of the certificate for such shares.
ARTICLE VII. NOTICE
Notice shall be in writing unless oral notice is reasonable under the
circumstances. Notice may be communicated in person; by telephone, telegraph,
teletype or other form of wire or wireless communication; or by mail or private
carrier. If these forms of personal notice shall be impracticable, notice may be
communicated by a newspaper of general
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circulation in the area where published; or by radio, television or other form
of public broadcast communication.
Written notice to shareholders, if in a comprehensible form, shall be
effective when mailed, if mailed postpaid and correctly addressed to the
shareholder's address shown in the corporation's current record of shareholders.
Except as provided above with respect to notice to shareholders, written
notice, if in a comprehensible form, shall be effective at the earliest of the
following:
(1) When received;
(2) Five (5) days after its deposit in the United States mail, as
evidenced by the postmark, if mailed postpaid and correctly addressed;
(3) On the date shown on the return receipt, if sent by registered or
certified mail, return receipt requested, and the receipt is signed by or on
behalf of the addressee.
Oral notice shall be effective when communicated if communicated in a
comprehensible manner.
If applicable law prescribes notice requirements for particular
circumstances, those requirements govern. If the articles of incorporation or
these bylaws prescribe notice requirements, not inconsistent with this section
or other provisions of applicable law, those requirements govern.
ARTICLE VIII. WAIVER OF NOTICE; ASSENT TO ACTIONS
Unless otherwise provided by law, a shareholder or director of the
corporation may waive any notice required by applicable law, the articles of
incorporation or these bylaws, before or after the date and time stated in the
notice. Except as provided below, the waiver must be in writing, be signed by
the shareholder or director entitled to the notice, and delivered to the
corporation for inclusion in the minutes or filing with the corporate records.
A director's attendance at or participation in a meeting waives any
required notice to him of the meeting unless the director at the beginning of
the meeting (or promptly upon his arrival) objects to holding the meeting or
transacting business at the meeting and does not thereafter vote for or assent
to action taken at the meeting. A shareholder's attendance at a meeting (i)
waives objection to lack of notice or defective notice of the meeting unless the
shareholder at the beginning of the meeting objects to holding the meeting or
transacting business at the meeting, and (ii) waives objection to consideration
of a particular matter at the meeting that is not within the purpose or purposes
described in the meeting notice, unless the shareholder objects to considering
the matter when it is presented
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A director who is present at a meeting of the board of directors or a
committee of the board of directors when corporate action is taken shall be
deemed to have assented to the action taken unless: (1) he objects at the
beginning of the meeting (or promptly upon his arrival) to holding it or
transacting business at the meeting or, as to a matter required under the
articles of incorporation or the bylaws to be included in the notice of the
purpose of the meeting, he objects before action is taken on the matter; (2) his
dissent or abstention from the action taken shall be entered in the minutes of
the meeting; or (3) he delivers written notice of his dissent or abstention to
the presiding officer of the meeting before its adjournment or to the
corporation immediately after adjournment of the meeting. The right of dissent
or abstention shall not be available to a director who votes in favor of the
action taken.
ARTICLE IX. EMERGENCY BYLAWS
The emergency bylaws provided in this article shall be operative during
any emergency in the conduct of the business of the corporation, notwithstanding
any different provision in the preceding articles of the bylaws or in the
articles of incorporation of the corporation or in the Alabama Business
Corporation Act. An emergency exists if a quorum of the corporation's directors
cannot readily be assembled because of some catastrophic event. To the extent
not inconsistent with the provisions of this article, the bylaws provided in the
preceding articles shall remain in effect during such emergency and upon its
termination the emergency bylaws shall cease to be operative.
During any such emergency:
(a) A meeting of the board of directors may be called by any officer or
director of the corporation. Notice of the meeting shall be given by the officer
or director calling the meeting only to those directors whom it is practicable
to reach and may be given in any practicable manner, including by publication
and radio.
(b) One or more officers of the corporation present at a meeting of the
board of directors may be deemed to be directors for the meeting, in order of
rank and within the same rank in order of seniority, as necessary to achieve a
quorum.
(c) The board of directors, either in anticipation of or during any such
emergency, may modify lines of succession to accommodate the incapacity of any
director, officer, employee or agent.
(d) The board of directors, either in anticipation of or during any such
emergency, may relocate the principal offices or regional offices, or authorize
the officers to do so.
Corporate action taken in good faith during an emergency under this
section to further the ordinary business affairs of the corporation binds the
corporation and may not be used to impose liability on a corporate director,
officer, employee or agent.
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These emergency bylaws shall be subject to repeal or change by further
action of the board of directors or by action of the shareholders, but no such
repeal or change shall modify the provisions of the next preceding paragraph
with regard to action taken prior to the time of such repeal or change. Any
amendment of these emergency bylaws may make any further or different provision
that may be practical and necessary for the circumstances of the emergency.
ARTICLE X. DISTRIBUTIONS
The board of directors may authorize and the corporation may make
distributions to its shareholders, subject to restriction by the articles of
incorporation and applicable law.
ARTICLE XI. CORPORATE SEAL
The board of directors shall provide a corporate seal which shall be
circular in form and shall have inscribed thereon the name of the corporation
and the state of incorporation and the words "Corporate Seal".
ARTICLE XII. AMENDMENTS
Unless the articles of incorporation, applicable law or a resolution of
the shareholders reserves this power exclusively to the shareholders in whole or
part, the corporation's board of directors may amend or repeal these bylaws and
adopt new bylaws at any regular or special meeting of the board of directors.
ACCEPTED THIS ____ day of _______, 1996.
By: /s/ W. H. Holman, Jr.
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TITLE: President & CEO, Chairman
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Exhibit 3.7
- ---------------------------------
Use the form and acknowledgement if seeking application for Charter of
Incorporation in Mississippi.
THE CHARTER OF INCORPORATION OF
MCCARTY-HOLMAN CO., INC. JACKSON MISSISSIPPI
--------------------------------------------
1. The corporate title of said company is MCCARTY-HOLMAN CO., INC.
------------------------
2. The name of the incorporators are:
PAUL CHAMBERS Post Office JACKSON, MISSISSIPPI
-------------------------- --------------------
E.L. TRENHOLM Post Office JACKSON, MISSISSIPPI
-------------------------- --------------------
Post Office
-------------------------- --------------------
Post Office
-------------------------- --------------------
Post Office
-------------------------- --------------------
Post Office
-------------------------- --------------------
Post Office
-------------------------- --------------------
Post Office
-------------------------- --------------------
3. The domicile is at JACKSON, MISSISSIPPI.
--------------------
4. Amount of capital stock and particulars as to class or classes thereof:
$1,000,000,000, all of one class, being common stock.
5. Number of shares for each class and par value thereof: 10,000 SHARES OF THE
PAR VALUE of $100.00 per share, all of one class, being common stock.
6. The period of existence (not to exceed fifty years) is FIFTY (50) YEARS.
<PAGE>
7. The purpose for which it is created:
To engage generally in the wholesale and retail mercantile business, and
to that end to buy, trade for and otherwise acquire, to own, use, keep and
store, and to sell, trade and otherwise dispose of, all kinds of goods,
wares and merchandise, and all kinds of furniture, fixtures and equipment
used in and about wholesale and retail stores, and to buy, lease, trade,
for or otherwise acquire, to own, lease and use, and to sell, mortgage,
hypothecate or otherwise dispose of, such real and personal property as
may be necessary or useful in the conduct of said business, and generally
to enter into contracts and do and perform such other acts as may
incidental thereto.
The rights and powers that may be exercised by this corporation, in
addition to the foregoing, are those conferred by Chapter 100, Code of
Mississippi of 1930, and amendments thereto.
8. Number of Shares of each class to be authorized and paid for before the
corporation may begin business.
100 shares of common stock.
/s/ Paul Chambers
---------------------
/s/ E. L. Trenholm
---------------------
---------------------
---------------------
Incorporators
<PAGE>
ACKNOWLEDGEMENT
STATE OF MISSISSIPPI )
COUNTY OF HINDE )
This day personally appeared before me, the undersigned authority IN AND
FOR SAID COUNTY AND STATE, THE ABOVE-NAMED PAUL CHAMBERS AND E.L. TRENHOLM,
incorporators of the corporation known as the MCCARTY-HOLMAN CO., INC., WHO
SEVERALLY acknowledged that (he) (they) signed and executed the above and
foregoing articles of incorporation as (his) (their) act and deed on the 24TH
day of MARCH, 1949.
/S/ [ILLEGIBLE]
--------------------------
NOTARY PUBLIC
My commission expires: JAN 18, 1953
STATE OF MISSISSIPI )
COUNTY OF __________ )
This day personally appeared before me, the undersigned authority
incorporators of the corporation known as the
who acknowledged that (he) (they) signed and executed the above and foregoing
articles of incorporation as (his) (their) act and deed on this the day of
, 194
STATE OF MISSISSIPPI )
COUNTY OF ________ )
This day personally appeared before me, the undersigned authority
incorporators of the corporation known as the
who acknowledged that (he) (they) signed and executed the above
foregoing articles of incorporation as (his) (their) act and deed on the
day of , 194 .
<PAGE>
Received at the office of the Secretary of State this the 24TH MARCH, A.D.,
1949, together with the sum of $500.00 deposited to cover the recording fee, and
referred to the Attorney General for his opinion.
/S/ [ILLEGIBLE]
---------------------------
Secretary of State
Jackson, Miss. MARCH 24TH, 1949
I have examined the charter of incorporation and am of the opinion that it
is not violative of the Constitution and laws of the state, or of the United
States.
/S/ [ILLEGIBLE]
----------------------------
Attorney General
By: /S/ [ILLEGIBLE]
--------------------------
Assistant Attorney General
Note: In case all incorporators are together when acknowledgement is taken, one
acknowledgement will be sufficient.
<PAGE>
State of Mississippi
EXECUTIVE OFFICE
[Graphic Omitted]
JACKSON
The within and forgoing Chapter of Incproration of
McCARTY-HOLMAN, CO., INC.
is hereby approved.
In testimony whereof, I have hereunto set
my hand and caused the Great Seal of
the State of Mississippi to be affixed
this Twenty-fourth day of
March, 1949.
[Seal]
/s/ [Illegible]
-------------------------------
Governor
By the Governor
/s/ [Illegible]
-------------------------------
Secretary of State
Recorded in the Secretary of State's Office this
the twenty-fifth day of March, 1949.
<PAGE>
State of Mississippi
[Graphic Omitted]
Office of Secretary of State
Jackson
CERTIFICATE OF AMENDMENT
OF
MCCARTY-HOLMAN CO., INC.
The undersigned, as Secretary of State of Mississippi, hereby certifies
that duplicate originals of Articles of Amendment to the Articles of
Incorporation of the above corporation duly signed and verified pursuant to the
provisions of the Mississippi Business Corporation Act, have been received in
this office and are found to conform to law.
ACCORDINGLY the undersigned, as such Secretary of State, and by virtue of
the authority vested in him by law, hereby issues this Certificate of Amendment
to the Articles of Incorporation and attaches hereto a duplicate original of the
Articles of Amendment.
Given under my hand and Seal of Office,
This the 26th day of June 1986.
[Seal]
/s/ Dick Molpus
SECRETARY OF STATE.
<PAGE>
FILED
JUN 26, 1986
Dick Molpus
SECRETARY
OF STATE
(TO BE EXECUTED IN DUPLICATE)
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
McCARTY-HOLMAN CO., INC.
Pursuant to the provisions of Section 61 of Mississippi Business
Corporation Act, the undersigned corporation adopts the following Articles of
Amendment to its Articles of Incorporation:
FIRST: The name of this corporation is McCarty-Holman Co., Inc.
SECOND: The following amendment of the Articles of Incorporation was
adopted by the shareholders of the corporation on June 25, 1986 in the manner
prescribed by the Mississippi Business Corporation Act:
(Insert Amendment)
"The corporation elects not to be governed by the Mississippi
Shareholder Protection Act, Mississippi Code Annotated Section
79-25-1."
THIRD: The number of shares of the corporation outstanding at the time of
such adoption was 6650 and the number of shares entitle to vote thereon was
6650.
FOURTH: The designation and number of outstanding shares of each class
entitled to vote thereon as a class were as follows:
Class (Note 1) Number of Shares
None
<PAGE>
FIFTH: The number of shares voted for such amendment was 6013 and the
number of shares voted against such amendment was 0.
SIXTH: The number of shares of each class entitled to vote thereon as a
class voted for and against such amendment; respectively was:
Number of Shares Voted
Class (Note 1) For Against
None
SEVENTH: The manner, if not set forth in such amendment, in which any
exchange, reclassification, or cancellation of issued shares provided for in the
amendment shall be effected, is as follows: (Note 2)
No Change
EIGHTH: The manner in which such amendment effects a change in the amount
of stated capital, and the amount of stated capital (expressed in dollars) as
changed by such amendment, are as follows: (Note 2)
No Change
Dated June 25, 1986 McCarty-Holman Co., Inc.
-------------------------
(Exact Corporate Title)
By /s/ W.H. Holman, Jr.
------------------------
Its President
Notes 1. If inapplicable, insert "None",
2. If inapplicable, insert "No Change".
By /s/ Roger P. Friou
------------------------
Its Secretary
STATE OF MISSISSIPPI }
} SS.
COUNTY OF HINDS }
I, Lora Dean, a notary public, do hereby certify that on this 25th
day of June, 1986, personally appeared before me W.H. Holman, Jr., who, being by
me first duly sworn, declared that he is the President of McCarty-Holman Co.,
Inc., that he executed the foregoing document as President of the corporation,
and that the statements therein contained are true.
/s/ Lora Dean
----------------------
Notary Public
My commission expires My commission expires Sept. 16, 1988
(NOTARIAL SEAL)
<PAGE>
STATE OF MISSISSIPPI }
} SS.
COUNTY OF HINDS }
I, Lora Dean, a notary public, do hereby certify that on this 25th
day of June, 1986, personally appeared before me Roger P. Frion, who, being by
me first duly sworn, declared that he is the Secretary of McCarty-Holman Co.,
Inc., that he executed the foregoing document as Secretary of the corporation,
and that the statements therein contained are true.
/s/ Lora Dean
----------------------
Notary Public
My commission expires My commission expires Sept. 16, 1988
(NOTARIAL SEAL)
<PAGE>
ARTICLES OF AMENDMENT
PROFIT
The undersigned corporation, pursuant to Section 79-4-10.06 of the
Mississippi Code of 1972, hereby executes the following document and sets forth
1. The name of the corporation is McCarty-Holman Co., Inc.
2. The text of the amendment adopted to Article 6 is attached as
Exhibit "A".
3. The amendment was adopted October 16, 1991.
4. The amendment was adopted by the board of directors without
shareholder action, and shareholder action was not required.
5. The text of the amendment adopted as Article 10 is attached as
Exhibit "B".
6. The amendment was adopted October 16, 1991.
7. (a) The designation, number of outstanding shares, number of votes
entitled to be cast by each voting group entitled to vote separately
on the amendment, and the number of votes of each voting group
indisputably represented at the meeting was:
No. of Votes No. of Votes
Designation No. Outstanding Entitled to be Indisputably
of Shares Shares Cast Represented
----------- --------------- -------------- ------------
Common stock 6652 6652 5226
(b) The total number of votes cast for and against the amendment by
each voting group entitled to vote separately on the amendment was:
Total No. of Total No. of Votes
Voting Group Votes Cast FOR Cast AGAINST
------------ -------------- ------------
Common stock 5226 -0-
Time: 8:00 A.M.
Amount Received:
$50.00
Filed 12/12/91
/s/ [Illegible]
Secretary of State
State of Mississippi
<PAGE>
EXHIBIT "A"
to
ARTICLES OF AMENDMENT
McCARTY-HOLMAN CO., INC.
6. The duration of the corporation is perpetual.
<PAGE>
EXHIBIT "B"
to
ARTICLES OF AMENDMENT
McCARTY-HOLMAN CO., INC.
10. A director of the corporation shall not be liable to the corporation
or its shareholders for money damages for an action taken, or any
failure to take action, as a director, except as liability for (i)
the amount of a financial benefit received by a director to which he
is not entitled; (ii) an intentional infliction of harm on the
corporation or the shareholders; (iii) a violation Miss. Code Ann.
Ss. 79-4-8.33 (1972), as amended, or, (iv) an intentional violation
of criminal law. No amendment or repeal of this Article shall apply
to or have any effect on the liability of alleged liability of any
director of the corporation for or concerning any action by a
director occurring prior to such amendment or repeal.
<PAGE>
FILED
MAR 05 1996
ERIC CLARK
SECRETARY
OF STATE
ARTICLES OF SHARE EXCHANGE
The undersigned corporations, pursuant to the provisions of Section
79-4-11.05 of the Mississippi Business Corporation Act, hereby execute the
following Articles of Share Exchange:
ARTICLE ONE
The Plan of Share Exchange (the "Plan") is annexed hereto as Exhibit A and
made a part hereof.
ARTICLE TWO
As to each corporation, the number of shares of common stock outstanding,
being the only class of stock entitled to vote on the approval and adoption of
the Plan, are:
Total Number of
Total Number Shares Entitled
Corporation outstanding to Vote
Jitney-Jungle Stores of America, Inc. 12,873 12,873
Southern Jitney Jungle Company 4,910 4,910
McCarty-Holman Co., Inc. 6,652 6,652
Jitney-Jungle Bakery, Inc. 10,906 10,906
ARTICLE THREE
As to each corporation, the number of shares voted for and against the
Plan respectively:
<PAGE>
Name of Total Shares Total Shares
Corporation Voted For Voted Against
Jitney-Jungle Stores of America, Inc. 12,870 0
Southern Jitney Jungle Company 4,900 0
McCarty-Holman Co., Inc. 6,651 0
Jitney-Jungle Bakery, Inc. 10,905 0
IN WITNESS WHEREOF each of the undersigned corporations has caused these
Articles of Share Exchange to be executed in its name by its president, as of
the 5th day of March, 1996.
JITNEY-JUNGLE STORES OF AMERICA, INC.
By: /s/ W. H. Holman, Jr.
-----------------------------------------
Name: W. H. Holman, Jr.
Title: President
SOUTHERN JITNEY JUNGLE COMPANY
By: /s/ W. H. Holman, Jr.
-----------------------------------------
Name: W. H. Holman, Jr.
Title: President
McCARTY-HOLMAN CO., INC.
By: /s/ W. H. Holman, Jr.
-----------------------------------------
Name: W. H. Holman, Jr.
Title: President
JITNEY-JUNGLE BAKERY, INC.
By: /s/ W. H. Holman, Jr.
-----------------------------------------
Name: W. H. Holman, Jr.
Title: President
-2-
<PAGE>
PLAN OF SHARE EXCHANGE
PLAN OF SHARE EXCHANGE pursuant to Sections 79-4-11.01 et seq. of
the Mississippi Business Corporation Act (the "MBCA"), by and between
Jitney-Jungle Stores of America, Inc. ("Stores"), Southern Jitney Jungle Company
("Southern"), McCarty-Holman Co., Inc. ("McCarty-Holman") and Jitney-Jungle
Bakery, Inc. ("Bakery"), each a Mississippi corporation.
WITNESSETH:
WHEREAS, JJ Acquisitions Corp. (formerly known as BRS No. 1, Inc.),
a Delaware corporation ("JJAC'), Stores, Southern, McCarty-Holman and Bakery
have entered into an Agreement and Plan of Exchange and of Merger dated as of
November 16, 1995 (the "Merger Agreement"), setting forth certain
representations, warranties, covenants and agreements in connection with the
transactions therein and herein contemplated;
WHEREAS, the parties thereto desire to effect the exchange (the
"Exchange") of capital stock of each of Southern, McCarty-Holman and Bakery for
newly-issued shares of common stock, without par value, of Stores ("Stores
Shares") upon the terms hereinafter stated; and
WHEREAS, the respective Boards of Directors of Stores, Southern,
McCarty-Holman and Bakery have by resolution duly approved and adopted the
Merger Agreement and this Plan of Share Exchange and directed that the Merger
Agreement
A-1
<PAGE>
and this Plan of Share Exchange be submitted to the respective shareholders of
each such company for their approval and adoption;
NOW, THEREFORE, the parties hereto do hereby approve and adopt the
following Plan of Share Exchange for the purpose of setting forth the terms and
conditions of the Exchange and the mode of carrying the same into effect.
1.01 Effective Time of Exchange. The exchange of stock of each of
Southern, McCarty-Holman and Bakery for Stores Shares shall become effective on
the Closing Date immediately prior to the Merger Effective Time, or at such
other time as is permissible in accordance with the provisions of Sections
79-4-11.01 et seq. of the MBCA and as JJAC and the Companies shall agree should
be specified in the Articles of Share Exchange, but in no event before the
satisfaction or, if permissible, waiver of all the conditions set forth in
Articles Seven and Eight of the Merger Agreement. The time and date as of which
the Exchange becomes effective is herein referred to as the "Exchange Effective
Time."
1.02 Effect of the Exchange. As of the Exchange Effective Time:
(a) All of the outstanding shares of capital stock of each of
Southern, McCarty-Holman and Bakery shall be simultaneously transferred to
Stores, which shall continue its corporate existence and be the acquiring
corporation after the Exchange (sometimes hereinafter referred to as the
"Acquiring Corporation"). The former holders of such shares shall be entitled
only to such exchange rights as are provided in the Articles of Share Exchange
and this Plan of Share Exchange. Such Exchange shall be pursuant to the
provisions of, and with the effect provided in, the MBCA. The separate
A-2
<PAGE>
corporate existence of each of Southern, McCarty-Holman and Bakery shall
continue with all of the outstanding shares of the capital stock of each of
Southern, McCarty-Holman and Bakery to be held by the Acquiring Corporation. As
of the Exchange Effective Time and thereafter, the Acquiring Corporation,
without any order or other action on the part of any court or otherwise, shall
possess all of the rights, privileges and powers as the holder of all capital
stock of each of Southern, McCarty-Holman and Bakery.
(b) The respective articles of incorporation of Southern,
McCarty-Holman and Bakery in effect immediately prior to the Exchange Effective
Time shall thereafter continue in full force and effect as the respective
articles of incorporation of Southern, McCarty-Holman and Bakery, until further
amended as provided by law.
(c) The respective bylaws of Southern, McCarty-Holman and Bakery in
effect immediately prior to the Exchange Effective Time shall thereafter
continue in full force and effect as the respective bylaws of Southern,
McCarty-Holman and Bakery, until amended as provided by law.
(d) The respective directors of Southern, McCarty-Holman and Bakery
immediately prior to the Exchange Effective Time shall each remain the directors
of each such corporation after the Exchange Effective Time, with each such
director to serve until his or her respective successor is duly elected and
qualified subject to the bylaws thereof. Subject to the respective authority of
the board of directors of each of Southern, McCarty-Holman and Bakery, the
respective officers of such corporations
A-3
<PAGE>
immediately prior to the Exchange Effective Time shall remain the officers of
such corporations after the Exchange Effective Time.
1.03 Exchange of Shares. The mode of carrying into effect the Exchange and
the manner and basis of transferring and exchanging the shares of each of
Southern, McCarty-Holman and Bakery for Stores Shares, shall be as follows:
(a) The Companies Common Stock. Upon the Exchange Effective Time,
each share of the common stock of each of Southern, McCarty-Holman and Bakery
(the "Companies Common Stock") issued and outstanding at the Exchange Effective
Time (other than Exchange Dissenting Shares, as defined below) shall be
automatically converted by the Exchange, without any action on the part of the
holder thereof, into and represent the right to receive Stores Shares as
follows:
(i) Each one (1) share of common stock of Southern shall be
exchanged for 0.744 Stores Shares;
(ii) Each one (1) share of common stock of McCarty-Holman shall be
exchanged for 0.534 Stores Shares; and
(ii) Each one (1) share of common stock of Bakery shall be exchanged
for 0.026 Stores Shares.
1.04 Payment of Exchange Consideration. As of the Exchange Effective Time,
each share certificate that represented as of the Exchange Effective Time shares
of the Companies Common Stock shall be deemed to be transferred to Stores on the
respective shareholder registers of Southern, McCarty-Holman, Bakery, and shall
thereafter be void
A-4
<PAGE>
and of no effect to the Shareholders except as evidence of the right to receive
Stores Shares as described herein (other than Exchange Dissenting Shares, as
defined below, which shall represent only such rights as are provided by law or
the Merger Agreement).
1.05 Dissenting Shares. Notwithstanding anything herein or in the Merger
Agreement to the contrary, shares of Companies Common Stock issued and
outstanding immediately prior to the Exchange Effective Time and held by a
holder (if any) who has exercised the right to demand payment for fair value of
such shares in accordance with Sections 794-13.01 et seq. of the MBCA (the
"Exchange Dissenting Shares"), shall not be converted into a right to receive
Stores Shares (or the Merger Consideration payable in respect thereof following
the Merger Effective Time) unless such holder fails to perfect or otherwise
loses such holder's right to such payment or appraisal, if any. If, after the
Merger Effective Time, such holder fails to perfect or loses any such right to
payment or appraisal, then as of the later of the Merger Effective Time or the
occurrence of such event, such holder shall then be entitled to the right to
receive only the Merger Consideration payable with respect to the number of
Stores Shares which such holder would have had the right to receive in the
Exchange in accordance with the provisions of the Merger Agreement and hereof
had such holder not exercised his dissenters' rights.
1.06 No Further Transfers. As of the Exchange Effective Time, each share
certificate that represented as of the Exchange Effective Time shares of the
Companies Common Stock shall be deemed to be transferred to Stores on the
respective shareholder registers of Southern, McCarty-Holman and Bakery, and
shall thereafter be
A-5
<PAGE>
void and of no effect to the Shareholders except as evidence of the right to
receive Stores Shares.
1.07 Authorized Actions. The Boards of Directors and the proper officers
of the Companies, respectively, are hereby authorized, empowered and directed to
do any and all acts and things, and to make, execute, deliver, file, or record
any and all instruments, papers and documents which shall be or become
necessary, proper or convenient to carry out or put into effect any of the
provisions of this Plan of Share Exchange or of the Exchange herein provided
for.
1.08 Definitions. As used herein, the following terms shall have the
following meanings:
(a) "Closing Date" means the earliest day on which all of the
conditions set forth in Articles Seven and Eight of the Merger Agreement are
fulfilled or waived (subject to applicable law), or such other date and at such
other time as the parties to the Merger Agreement may agree in writing.
(b) "Companies" means Stores, Southern, McCarty-Holman and Bakery.
(c) "Merger" means the Merger of JJAC with and into Stores pursuant
to the Merger Agreement.
(d) "Merger Consideration" means the consideration to be paid to
each Shareholder in connection with the Merger.
(e) "Merger Effective Time" means the time and date as of which the
Merger becomes effective.
A-6
<PAGE>
(f) "Shareholders" means the shareholders of each of the Companies
prior to the Exchange Effective Time and of Stores thereafter but prior to the
Merger Effective Time.
1.09 Index of other Definitions. The following terms are defined herein in
the sections indicated below:
"Acquiring Corporation" ...................................... Section 1.02(a)
"Bakery" ............................................................ Preamble
"JJAC' .............................................................. Recitals
"Companies Common Stock" .................................... Section 1.03 (a)
"Exchange" .......................................................... Recitals
"Exchange Dissenting Shares" .................................... Section 1.05
"Exchange Effective Time" ....................................... Section 1.01
"MBCA" .............................................................. Preamble
"McCarty-Holman" .................................................... Preamble
"Merger Agreement" .................................................. Recitals
"Stores" ............................................................ Preamble
"Stores Shares" ..................................................... Recitals
"Southern" .......................................................... Preamble
A-7
<PAGE>
OFFICE OF THE MISSISSIPPI SECRETARY OF STATE
March 5, 1996
VIA TELECOPIER (212)308-2041
Mr. R. Barry Cannada
c/o Dechert Price & Rhoads
477 Madison Avenue
New York, NY 10022-5891
Re: Jitney-Jungle Transactions
Confirmation of Filings
Dear Mr. Cannada:
This will confirm that today, March. 5, 1996, the documents described
below were properly filed with this office at the respective times indicated:
1. Articles of Amendment to the Articles of Incorporation of Jitney-Jungle
Stores of America, Inc., at 8:15 a.m., CST;
2. Articles of Share Exchange of Jitney-Jungle Stores of America, Inc.,
Southern Jitney Jungle Company, McCarty-Holman Co., Inc. and Jitney-Jungle
Bakery, Inc., at 12:10 p.m., CST;
3. Articles of Merger of JJ (Southern), Inc., a Delaware corporation, as
the merging corporation, and Southern Jitney Jungle Company, a Mississippi
corporation, as the surviving corporation, at 12:25 p.m., CST;
4. Articles of Merger of JJ (Pump and Save), Inc., a Delaware corporation,
as the merging corporation, and Pump and Save, Inc., a Mississippi corporation,
as the surviving corporation, at 12:25 p.m., CST;
5. Articles of Merger of JJ (McCarty-Holman), Inc., a Delaware
corporation, as the merging corporation, and McCarty-Holman Co., Inc., a
Mississippi corporation, as the surviving corporation, at 12:25 p.m., CST;
<PAGE>
Mr. R. Barry Cannada
March 4, 1996
Page 2
6. Articles of Merger of JJ (Bakery), Inc., a Delaware corporation, as the
merging corporation, and Jitney-Jungle Bakery, Inc., a Mississippi corporation,
as the surviving corporation, at 12:35 p.m., CST; and
7. Articles of Merger of JJ Acquisitions Corp., a Delaware corporation, as
the merging corporation, and Jitney-Jungle Stores of America, Inc., a
Mississippi corporation, as the surviving corporation, at 12:25 p.m., CST.
Sincerely,
Mississippi Secretary of State
By: /s/ Ray Bailey
-----------------------------------
Ray Bailey,
Assistant Secretary of State
<PAGE>
FILED
MAR 05 1996
ERIC [ILLEGIBLE]
SECRETARY
OF STATE
ARTICLES OF MERGER OR SHARE EXCHANGE
PROFIT
The undersigned corporations, pursuant to Section 79-4-11.05, as amended, hereby
execute the following articles of merger and share exchange and set forth:
1. The names of the corporations are McCarty-Holman Co., Inc., a Mississippi
corporation (the "Surviving Corporation") and JJ (McCarty-Holman), Inc., a
Delaware corporation (the "Merging Corporation")
2. The plan of merger or share exchange. (Attached)
3. (Mark appropriate box.)
( ) (a) Shareholder approval of the plan of merger was not required.
(X) (b) If approval of the shareholders of one or more corporations party
to the merger or share exchange was required:
(i) the designation, number of outstanding shares, and number
of votes entitled to be cast by each voting group entitled to vote
separately on the plan as to each corporation were:
Number of No. of votes
Name of outstanding entitled to be
Corporation Designation shares cast
----------- ----------- ----------- --------------
McCarty-Holman Co., Inc. Common 6,652 6,652
JJ (McCarty-Holman), Inc. Common 1,000 1,000
(ii) And either
against the plan by each voting group entitled to vote separately on the plan
was:
Total Number of Total Number of
Name of votes cast FOR votes cast AGAINST
Corporation Voting Group the plan the plan
----------- ------------ --------------- ------------------
McCarty-Holman Co., Inc. Common 6,652 6,652
JJ (McCarty-Holman), Inc. Common 1,000 1,000
OR
<PAGE>
3. b. the total number of undisputed votes cast for the plan separately by each
voting group was:
Total Number of
Name of Undisputed Votes Cast
Corporation Voting Group FOR the Plan
----------- ------------ ---------------------
- ----------------- -------------------------
- ----------------- -------------------------
- ----------------- -------------------------
and the number cast for the plan by each voting group was sufficient for
approval by that voting group.
McCarty-Holman Co., Inc.
- --------------------------------------------------------------------------------
NAME OF CORPORATION
By: W. H. Holman. Jr./President /s/ W. H. Holman. Jr.
----------------------------------------------------------------------------
PRINTED NAME/CORPORATE TITLE SIGNATURE
JJ (McCarty-Holman). Inc.
- --------------------------------------------------------------------------------
NAME OF CORPORATION
By: Harold O. Rosser, II/President /s/ Harold O. Rosser, II
----------------------------------------------------------------------------
PRINTED NAME/CORPORATE TITLE SIGNATURE
- --------------------------------------------------------------------------------
NAME OF CORPORATION
By:
----------------------------------------------------------------------------
PRINTED NAME/CORPORATE TITLE SIGNATURE
NOTE
1. If shareholder approval is required, the plan must be approved by each
voting group entitled to vote on the plan by a majority of all votes
entitled to be cast by that voting group unless the Act or the articles of
incorporation provide for a greater or lesser vote, but not less than a
majority of all votes cast at a meeting.
2. The articles cannot be filed unless the corporation(s) has (have) paid all
fees and taxes (and delinquencies) imposed by law.
3. The articles must be similarly executed by each corporation that is a
party to the merger.
<PAGE>
AGREEMENT AND PLAN OF MERGER
McCARTY-HOLMAN CO., INC. AND JJ (McCARTY-HOLMAN), INC.
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement and Plan of Merger"),
dated as of March 5, 1996, is made and entered into by and between JJ
(McCarty-Holman), Inc., a Delaware corporation (the "Merging Corporation"), and
McCarty-Holman Co., Inc., a Mississippi corporation (the "Surviving
Corporation") (such Corporations being sometimes collectively referred to
hereinafter as the "Constituent Corporations").
WITNESSETH:
WHEREAS, the Constituent Corporations desire to effect a merger of the
Merging Corporation with and into the Surviving Corporation pursuant to
provisions of the Mississippi Business Corporation Act (the "MBCA") and the
Delaware General Corporation Law (the "DGCL");
WHEREAS, the respective Boards of Directors of the Merging Corporation and
the Surviving Corporation have determined that it is advisable and in the best
interests of each of the Constituent Corporations that the Merging Corporation
merge with and into the Surviving Corporation upon the terms and subject to the
conditions herein provided;
WHEREAS, the respective Boards of Directors of the Merging Corporation and
the Surviving Corporation have, by resolutions duly adopted, (a) approved this
Agreement and Plan of Merger and directed that it be executed by the undersigned
officers and (b) have directed that it be submitted to a vote of the
shareholders of the Merging Corporation and the shareholders of the Surviving
Corporation, respectively;
<PAGE>
WHEREAS, the shareholders of the Merging Corporation and the shareholders
of the Surviving Corporation have approved this Agreement and Plan of Merger;
NOW THEREFORE, in consideration of the approval of the agreements herein
contained, the parties agree that the Merging Corporation shall be merged with
and into the Surviving Corporation, and that the terms and conditions of such
merger shall be as hereinafter set forth.
I. THE MERGER
1.1. Surviving Corporation. Subject to the terms and provisions of this
Agreement and Plan of Merger, and in accordance with the MBCA and the DGCL, at
the Effective Time (as defined in Section 1.8 hereof) the Merging Corporation
shall be merged with and into the Surviving Corporation (the "Merger"). The
Surviving Corporation shall be the surviving corporation of the Merger and shall
continue its corporate existence under the laws of the State of Mississippi. At
the Effective Time the separate corporate existence of the Merging Corporation
shall cease.
1.2. Registered Office of Surviving Corporation. The Surviving
Corporation's registered office in the State of Mississippi is located at 1770
Ellis Avenue, Suite 200, County of Hinds, Jackson, Mississippi 39204, and the
name of its registered agent in the State of Mississippi is W. H. Holman, Jr.
1.3. Effects of the Merger. At the Effective Time, the Merger shall have
the effects provided for herein and in Section 79-4-11.06 of the MBCA and
Sections 252 and 259 of the DGCL.
-2-
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1.4. Articles of Incorporation. As of the Effective Time, the Amended and
Restated Articles of Incorporation attached hereto as Exhibit A shall become the
Amended and Restated Articles of Incorporation of the Surviving Corporation (the
"Articles of Incorporation") until thereafter duly altered, amended or repealed
in accordance with the provisions thereof and applicable law.
1.5. By-Laws. As of the Effective Time, the By-Laws of the Surviving
Corporation as in effect immediately prior to the Effective Time shall become
the By-Laws of the Surviving Corporation (the "By-Laws") until thereafter duly
altered, amended or repealed in accordance with the provisions thereof, the
Articles of Incorporation and applicable law.
1.6. Directors of the Surviving Corporation. At the Effective Time, the
directors of JJ (McCarty-Holman), Inc. immediately prior to the Merger shall
become the directors of the Surviving Corporation and each such person shall
serve as a director of the Surviving Corporation until his successor is duly
elected and qualified in the manner provided in the By-Laws or as otherwise
provided by law or until his earlier death, resignation or removal in the manner
provided in the By-Laws or as otherwise provided by law.
1.7. Officers of the Surviving Corporation. At the Effective Time, each
person who is an officer of the Surviving Corporation immediately prior to the
Effective Time shall become an officer of the Surviving Corporation with each
such person to hold the same office in the Surviving Corporation, in accordance
with the By-Laws, as he or she held in the Surviving Corporation immediately
prior to the Effective Time.
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l.8. Effective Time. The Merger shall become effective upon filing (the
"Effective Time"), provided that a certificate of merger has been filed with the
Secretary of State of the State of Delaware in accordance with Section 252 of
the DGCL and articles of merger have been filed with the Secretary of State of
the State of Mississippi in accordance with the provisions of Section 79-4-11.05
of the MBCA.
II. MANNER AND BASIS OF' EXCHANGING OR CONVERTING SHARES
2.1. Capitalization of Constituent Corporations.
(a) The present capitalization of the Surviving Corporation consists
of 10,000 shares of Common Stock, par value $100.00 per share ("Surviving
Corporation Common Stock"), 6,652 shares of which are issued and outstanding.
(b) The present capitalization of the Merging Corporation consists
of 1,000,000 shares of Common Stock, par value $.01 per share ("Merging
Corporation Common Stock"), 1,000 shares of which are issued and outstanding and
1,000,000 shares of Preferred Stock, par value $.01 per share, none of which is
issued and outstanding.
2.2. Exchange or Conversion of Shares. At the Effective Time, by virtue of
the Merger and without any action on the part of the holder thereof, all of the
shares of Merging Corporation Common Stock shall be cancelled and all of the
Surviving Corporation Common Stock issued and outstanding immediately prior to
the Effective Time shall remain as fully paid and nonassessable shares of
Surviving Corporation Common Stock.
2.3. Effect of Conversion. At and after the Effective Time, each share
certificate which immediately prior to the Effective Time represented
outstanding shares of
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Surviving Corporation Common Stock (a "Surviving Corporation Certificate") shall
be deemed for all purposes to evidence ownership of, and to represent, the
number of shares of Surviving Corporation Common Stock represented by such
certificates immediately prior to the Effective Time pursuant to Section 2.2
hereof. The registered owner of any Surviving Corporation Certificate
outstanding immediately prior to the Effective Time as such owner appears in the
books and records of the Surviving Corporation immediately prior to the
Effective Time, shall, until the Surviving Corporation Certificate is
surrendered for transfer or exchange, have and be entitled to exercise any
voting and other rights with respect to and, subject to Section 2.4 hereof, to
receive any dividends or other distributions on the shares of Surviving
Corporation Common Stock.
2.4. Surrender of Certificates. The holder of a Merging Corporation
Certificate shall surrender the Merging Corporation Certificate after the
Effective Time to the Surviving Corporation for cancellation.
2.5. Effect of Dissenters' Rights. All shares of stock of the Constituent
Corporations have been voted in favor of the Merger; therefore, no shareholders
are entitled to elect dissenters rights.
III. APPROVAL: AMENDMENT: TERMINATION
3.1. Approval. This Agreement and Plan of Merger has been approved by the
shareholders of the Surviving Corporation pursuant to Section 79-4-11.03 of the
MBCA and by the shareholders of the Merging Corporation pursuant to Section 251
(c) of the DGCL
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<PAGE>
3.2. Abandonment. At any time prior to the Effective Time, this Agreement
and Plan of Merger may be terminated and the Merger may be abandoned by the
Board of Directors of either of the Constituent Corporations, or both,
notwithstanding approval of this Agreement and Plan of Merger by the
shareholders of the Merging Corporation and the shareholders of the Surviving
Corporation.
3.3. Amendment. This Agreement and Plan of Merger may be amended, modified
or supplemented by written agreement of the Constituent Corporations at any time
prior to the Effective Time, except as provided in Section 251(d) of the DGCL.
IV. MISCELLANEOUS
4.1. Additional Actions.
(a) Subject to Section 3.3 hereof, if either party hereto shall so
request prior to the Effective Time, the other party hereto shall from time to
time and at any reasonable time execute and deliver to the other party such
other and further documents, instruments and assurances and take such other
actions as may be reasonably necessary, appropriate or convenient in order to
carry out the purpose and intent of this Agreement and Plan of Merger and the
transactions contemplated hereby.
(b) If, at any time after the Effective Time, the Surviving
Corporation shall consider or be advised that the execution and delivery of any
further documents, instruments or assurances or the taking of any other actions
may be necessary, appropriate or convenient to (i) vest, perfect or confirm, of
record or otherwise, in the Surviving Corporation, title to and possession of
any property or right of the Merging Corporation acquired or to be acquired by
reason of, or as a result of, the Merger or (ii)
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<PAGE>
otherwise carry out the purpose and intent of this Agreement and Plan of Merger
and the transactions contemplated hereby, the Merging Corporation and its proper
officers and directors shall be deemed to have granted hereby to the Surviving
Corporation an irrevocable power of attorney to execute and deliver all such
documents, instruments and assurances and to take all actions necessary,
appropriate or convenient to vest, perfect or confirm title to and the
possession of such property or rights in the Surviving Corporation and otherwise
to carry out the purpose and intent of this Agreement and Plan of Merger and the
transactions contemplated hereby and the proper officers and directors of the
Surviving Corporation are hereby fully authorized in the name of the Merging
Corporation or otherwise to take any and all such action.
4.2. Notices. All notices and other communications required or permitted
hereunder shall be in writing and, unless otherwise provided in this Agreement
and Plan of Merger, shall be deemed to have been duly given when delivered to
the addressees at the addresses specified below:
(a) If to the Merging Corporation:
JJ (McCarty-Holman), Inc.
126 East 56th Street
29th Floor
New York, NY 10022
Attention: Harold O. Rosser II, President
(b) If to the Surviving Corporation:
McCarty-Holman Co., Inc.
1770 Ellis Avenue
Suite 200
Jackson, MS 39204
Attention: W. H. Holman, Jr.
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<PAGE>
or to such other address or addresses as either party may from time to time
designate as to itself by like notice.
4.3. Waiver. The Merging Corporation, on the one hand, and the Surviving
Corporation, on the other hand, by written notice to the other, may waive,
modify or extend the time for performance of any of the obligations or other
actions of the other under this Agreement and Plan of Merger; provided, however,
that neither party may without the consent of the other make or grant such
extension of time, waiver or modification of performance with respect to its own
obligations hereunder. Except as provided in the preceding sentence, no action
taken pursuant to this Agreement and Plan of Merger shall be deemed to
constitute a waiver of either party's rights hereunder and shall not operate or
be construed as a waiver of any subsequent breach, whether of a similar or
dissimilar nature.
4.4. Entire Agreement. This Agreement and Plan of Merger supersedes any
other agreement, whether written or oral, that may have been made or entered
into by the Merging Corporation or the Surviving Corporation (or by any
director, officer or representative of such parties) relating to the matters
contemplated hereby. This Agreement and Plan of Merger constitutes the entire
agreement by and between the parties on the subject hereof and there are no
agreements or commitments except as expressly set forth herein.
4.5. Limitations on Rights of the Parties. Nothing expressed or implied in
this Agreement and Plan of Merger is intended or shall be construed to confer
upon or give any person, firm or corporation other than the parties hereto and
their successors and
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<PAGE>
permitted assigns any rights or remedies under or by reason of this Agreement
and Plan of Merger or any transaction contemplated hereby.
4.6. Applicable Law. This Agreement and Plan of Merger and the legal
relations between the parties hereto shall be governed by and construed in
accordance with the substantive laws of the State of Mississippi, without giving
effect to the principles of conflict of laws thereof, except to the extent that
the effectiveness of the Merger may be subject to specific requirements of
Delaware law.
4.7. Execution in Counterparts. This Agreement and Plan of Merger may be
executed in one or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same agreement.
4.8. Titles and Headings. Titles and headings to articles and sections
herein are inserted for convenience of reference only, and are not intended to
be a part of or to affect the meaning or interpretation of this Agreement and
Plan of Merger.
4.9. Partial Invalidity. If any term or provision of this Agreement and
Plan of Merger or the application thereof to any party or circumstance shall, to
any extent, be held invalid and unenforceable, the remainder of this Agreement
and Plan of Merger, or the application of such term or provision to persons or
circumstances other than those as to whom or which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this Agreement and Plan of Merger shall be valid and enforceable to the fullest
extent permitted by law.
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<PAGE>
IN WITNESS WHEREOF, the Merging Corporation and the Surviving Corporation
have caused this Agreement and Plan of Merger to be executed by their respective
duly authorized officers as of the date first above written.
MERGING CORPORATION:
JJ (McCARTY-HOLMAN), INC., a
Delaware corporation
By: /s/Harold D. Rosser
----------------------------------
Name: Harold D. Rosser
Title: President
SURVIVING CORPORATION:
McCARTY-HOLMAN CO., INC., a
Mississippi corporation
By: /s/W.H. Holman, Jr.
----------------------------------
Name: W.H. Holman, Jr.
Title: President
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<PAGE>
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
McCARTY-HOLMAN CO., INC.
FIRST: The name of the corporation is McCarty-Holman Co., Inc.
SECOND: The corporation is authorized to issue 10,000 shares of Common
Stock, par value of $100.00 per share. Shareholders shall not have the right to
cumulate their votes for directors nor shall the shareholders be entitled to
multiply the number of votes they are entitled to cast by the number of
directors for whom they are entitled to vote and cast the product for a single
candidate or distribute the product among two (2) or more candidates.
THIRD: The street address of the corporation's registered office is 453
North Mill Street, Jackson, Mississippi 39202, and the name of its registered
agent at that office is W. H. Holman, Jr.
FOURTH: A director of the corporation will not be liable to the
corporation or to its shareholders for monetary damages for any action taken, or
any failure to take action, as a director, except liability for: (i) the amount
of a financial benefit received by a director to which he is not entitled; (ii)
an intentional infliction of harm on the corporation or the shareholders; (iii)
a violation of Section 79-4-8.33 of the Mississippi Code of 1972, as amended; or
(iv) an intentional violation of criminal law. If the Mississippi Business
Corporation Act is amended to authorize corporate action further eliminating or
limiting the personal liability of directors, then the liability of a director
of the corporation shall be eliminated or limited to the fullest extent
permitted by the Mississippi Business Corporation Act, as so amended. Any repeal
or modification of this Article by the shareholders of the corporation shall not
adversely affect any right or protection of a director of the corporation
existing at the time of such repeal or modification.
FIFTH: Provisions with respect to indemnification are as follows:
(A) Definitions. In this article:
(1) "corporation" includes this corporation and any domestic or foreign
predecessor entity of the corporation in a merger or other transaction in which
the predecessor's existence ceased upon consummation of the transaction;
(2) "director" means an individual who is or was a director of the
corporation or an individual who, while a director of the corporation, is or
was serving at the corporation's request as a director, officer, partner,
trustee, employee or agent of another foreign or domestic corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise. A
director shall be considered to be serving an employee benefit plan at the
<PAGE>
involve services by, him to the plan or to participants in or beneficiaries of
the plan. "Director" includes, unless the context requires otherwise, the estate
or personal representative of a director;
(3) "expenses" include counsel fees;
(4) "liability" means the obligation to pay a judgment, settlement,
penalty, fine (including an excise tax assessed with respect to an employee
benefit plan), or reasonable expenses incurred with respect to a proceeding;
(5) "official capacity" means: (i) when used with respect to a director,
the office of director in the corporation; and (ii) when used with respect to an
individual other than a director as contemplated in Section (G) hereof, the
office in the corporation held by the officer or the employment or agency
relationship undertaken by the employee or agent on behalf of the corporation.
As used herein, "official capacity" does not include service for any other
foreign or domestic corporation or any partnership, joint venture, trust,
employee benefit plan or other enterprise;
(6) "party" includes an individual who was, is, or is threatened to be
made a named defendant or respondent in a proceeding;
(7) "proceeding" means any threatened, pending, or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative and
whether formal or informal;
(B) Authority to Indemnify. (a) Except as provided in subsection (d)
hereof, the corporation shall indemnify any individual made a party to a
proceeding because he is or was a director against liability incurred in the
proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed:
(i) In the case of conduct in his official capacity with the
corporation, that his conduct was in its best interests; and
(ii) In all other cases, that his conduct was at least not opposed
to its best interests; and
(3) In the case of any criminal proceeding, he had no reasonable cause to
believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for a
purpose he reasonably believed to be in the interest of the participants in and
beneficiaries of the plan is conduct that satisfies the requirement of
subsection (a)(2)(ii) of Section (B) hereof.
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<PAGE>
(c) The termination of a proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent is not, of
itself, determinative that the director did not meet the standard of conduct
described in this section.
(d) The corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation; or
(2) In connection with any other proceeding charging improper
personal benefit to him, whether or not involving action in
his official capacity, in which he was adjudged liable on the
basis that personal benefit was improperly received by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation shall be limited to reasonable
expenses incurred in connection with the proceeding.
(C) Mandatory Indemnification. Unless otherwise limited by these articles
of incorporation, the corporation shall indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any proceeding to
which he was a party because he is or was a director of the corporation against
reasonable expenses incurred by him in connection with the proceeding.
(D) Advance for Expenses. (a) The corporation shall pay for or reimburse
the reasonable expenses incurred by a director who is a party to a proceeding in
advance of final disposition of the proceeding if:
(1) The director furnishes the corporation a written affirmation
of his good faith belief that he has met the standard of
conduct described in subsection 2 of Section (B) hereof;
(2) The director furnishes the corporation a written undertaking,
executed personally or on his behalf, to repay the advance if
it shall be ultimately determined that he did not meet the
standard of conduct; and
(3) A determination shall be made that the facts then known to
those making the determination would not preclude
indemnification under this article.
(b) The undertaking required by subsection (a) (2) of Section (D) hereof
must be an unlimited general obligation of the director but need not be secured
and may be accepted without reference to financial ability to make repayment.
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(c) Determination and authorizations of payments under this section shall
be made in the manner specified In Section (F) hereof.
(E) Court Ordered Indemnification. Unless these articles of incorporation
provide otherwise, a director of the corporation who is a party to a proceeding
may apply for indemnification to the court conducting the proceeding or to
another court of competent jurisdiction.
(F) Determination and Authorization of Indemnification. (a) The
corporation may not indemnify a director under Section (B) hereof unless
authorized in the specific case after a determination has been made that
indemnification of the director shall be permissible in the circumstances
because he has met the standard of conduct set forth In Section (B) hereof.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum
consisting of directors not at the time parties to the
proceeding;
(2) If a quorum cannot be obtained under subsection (b)(1) of
Section (F) hereof, by majority vote of a committee duly
designated by the board of directors (in which designation
directors who are parties may participate), consisting solely
of two (2) or more directors not at the time parties to the
proceeding;
(3) By special legal counsel:
(i) Selected by the board of directors or its committee in
the manner prescribed in subsection (b)(1) or (b)(2) of
Section (F) hereof; or
(ii) If a quorum of the board of directors cannot be obtained
under subsection (b)(1) of Section (F) hereof and a
committee cannot be designated under subsection (b)(2)
of Section (F) hereof, selected by a majority vote of
the full board of directors (in which selection
directors who are parties may participate); or
(4) By the shareholders, but shares owned by or voted under the
control of directors who are at the time parties to the
proceeding may not be voted on the determination.
(c) Authorization of indemnification and evaluation as to reasonableness
of expenses shall be made in the same manner as the determination that
indemnification shall be permissible, except that if the determination shall be
made by special legal counsel,
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authorization of indemnification and evaluation as to reasonableness of expenses
shall be made by those entitled under subsection (b)(3) of Section (F) hereof to
select counsel.
(d) The corporation agrees to submit requests for indemnification or
advancement of expenses to the board of directors of the corporation or to the
shareholders of the corporation, as applicable, within a reasonable time after
the director requests in writing that the corporation indemnify the director or
advance expenses to him.
(G) Indemnification of Officers, Employees and Agents. Unless otherwise
provided herein:
(1) An officer of the corporation who is not a director shall be entitled
to mandatory indemnification under Section (C) hereof, and shall be entitled to
apply for court-ordered indemnification under Section (E) hereof, in each case
to the same extent as a director;
(2) The corporation shall indemnify and advance expenses under this
article to an officer of the corporation who is not a director to the same
extent as to a director; and
(3) The corporation shall also indemnify and advance expenses to an
officer who is not a director to the extent, consistent with public policy, that
may be provided by the articles of incorporation, bylaws, general or specific
action of the board of directors or contract.
(H) Right of Corporation to Insure. The corporation may purchase and
maintain insurance on behalf of an individual who is or was a director, officer,
employee or agent of the corporation or who, while a director, officer, employee
or agent of the corporation, is or was serving at the request of the corporation
as a director, officer, partner, trustee, employee or agent of another foreign
or domestic corporation, partnership, joint venture, trust, employee benefit
plan or other enterprise, against liability asserted against or incurred by him
in that capacity or arising from his status as a director, officer, employee or
agent, whether or not the corporation would have power to indemnify him against
such liability under Sections (B) or (C) hereof or applicable law.
(I) Application of Article. (a) Unless these articles of incorporation
provide otherwise, any authorization of indemnification in the articles of
incorporation or the bylaws shall not be deemed to prevent the corporation from
providing the indemnity permitted or mandated by applicable law.
(b) The board of directors of the corporation shall have power to make any
further indemnity, including advance of expenses, to and to enter contracts of
indemnity with any director, officer, employee or agent, except an indemnity
against his gross negligence or willful misconduct. Any determination as to any
further indemnity shall be made in accordance with subsection (b) of Section (F)
hereof. Each such indemnity may
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continue as to a person who has ceased to have the capacity referred to above
and may inure to the benefit of the heirs, executors and administrators of such
person.
(c) The corporation shall pay or reimburse expenses incurred by a director
in connection with his appearance as a witness in a proceeding at a time when he
has not been made a named defendant or respondent to the proceeding when his
appearance as a witness is in connection with his serving as a director of the
corporation.
(J) Right to Bring Action to Enforce. The rights to indemnification and to
the advancement of expenses conferred under this article shall be contract
rights. If a claim under this article is not paid in full by the corporation
within 90 days after a written claim has been received by the corporation, the
director making such claim may at any time thereafter being suit against the
corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, the director shall be entitled to be paid also the expense of
prosecuting such claim. It shall be a defense to any such action that the
director has not met the standards of conduct which make it permissible under
this article or the laws of the State of Mississippi for the corporation to
indemnify the director for the amounts claimed, but the burden of proving such
defense shall be on the corporation. Neither the failure of the corporation
(including its board of directors, independent legal counsel, or its
shareholders) to have made a determination prior to the commencement of such
action that indemnification of the director shall be proper in the circumstances
because he has met the applicable standard of conduct set forth under the laws
of the State of Mississippi or under these articles of incorporation, nor an
actual determination by the corporation (including its board of directors,
independent legal counsel, or its shareholders) that the director had not met
such applicable standard of conduct, shall be a defense to the action or create
a presumption that the director had not met the applicable standard of conduct.
Dated: March 5, 1996.
McCARTY-HOLMAN CO., INC.
By: /s/W.H. Holman, Jr.
----------------------------------
W.H. Holman, Jr., Chairman and CEO
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Exhibit 3.8
RESTATED BYLAWS
OF
McCARTY-HOLMAN CO., INC.
ARTICLE I. PRINCIPAL OFFICE
The principal office of the corporation in the State of Mississippi shall
be located in the City of Jackson, County of Hinds. The corporation may have
such other offices, either within or without the State of Mississippi, as the
board of directors may designate or as the business of the corporation may
require from time to time.
ARTICLE II. SHAREHOLDERS
SECTION 1. Annual Meeting. The annual meeting of the shareholders shall be
held on the third Wednesday in the month of October, in each year at the hour of
10:00 o'clock, A.M., or such other time and date as may be determined by the
directors, for the purpose of electing directors and for the transaction of such
other business as may properly come before the meeting. If the day fixed for the
annual meeting shall be a legal holiday in the State of Mississippi, such
meeting shall be held on the next succeeding business day.
If the election of directors shall not be held on the day designated
herein for any annual meeting of the shareholders, or at any adjournment
thereof, the board of directors shall cause the election to be held at a special
meeting of the shareholders as soon thereafter as conveniently may be.
SECTION 2. Special Meetings. The corporation shall hold a special meeting
of shareholders (1) on call of its board of directors or the president; or (2)
unless the articles of incorporation provide otherwise, if the holders of at
least ten percent (10%) of all the votes entitled to be cast on any issue
proposed to be considered at the proposed special meeting sign, date and deliver
to the corporation's secretary one or more written demands for the meeting
describing the purpose or purposes for which it is to be held. If not otherwise
fixed under applicable law, the record date for determining shareholders
entitled to demand a special meeting shall be the date the first shareholder
signs the demand.
SECTION 3. Place of Meeting. The board of directors may designate any
place, either within or without the State of Mississippi, for any annual meeting
or for any special meeting of shareholders. A valid waiver of notice signed by
all shareholders entitled to notice may designate any place, either within or
without the State of Mississippi, as the
<PAGE>
place for any annual meeting or for any special meeting of shareholders. Unless
the notice of the meeting states otherwise, shareholders' meetings shall be held
at the corporation's principal office.
SECTION 4. Notice of Meeting. The corporation shall notify shareholders of
the date, time and place of each annual and special shareholders' meeting no
fewer than ten (10) nor more than sixty (60) days before the meeting date.
Unless applicable law or the articles of incorporation require otherwise, the
corporation shall give notice only to shareholders entitled to vote at the
meeting.
Unless applicable law or the articles of incorporation require otherwise,
notice of an annual meeting need not include a description of the purpose or
purposes for which the meeting is called. Notice of a special meeting must
include a description of the purpose or purposes for which the meeting shall be
called. Only business within the purpose or purposes described in the meeting
notice may be conducted at a special shareholders' meeting.
Unless these bylaws require otherwise, if an annual or special
shareholders' meeting is adjourned to a different date, time or place, notice
need not be given of the new date, time or place if the new date, time or place
is announced at the meeting before adjournment. If a new record date for the
adjourned meeting is or must be fixed under applicable law or Article II,
Section 5 of these bylaws, however, notice of the adjourned meeting must be
given under this section to persons who are shareholders as of the new record
date.
SECTION 5. Closing of Transfer Books or Fixing of Record Date. The board
of directors of the corporation may fix the record date for one or more voting
groups in order to determine shareholders entitled to notice of a shareholders'
meeting, to demand a special meeting, to vote or to take any other action. A
record date may not be more than seventy (70) days before the meeting or action
requiring a determination of shareholders. If not otherwise fixed by law, the
record date for determining shareholders entitled to notice of and to vote at an
annual or special shareholders' meeting shall be the day before the first notice
is delivered to shareholders. If the board of directors does not fix the record
date for determining shareholders entitled to a distribution (other than one
involving a purchase, redemption or other acquisition of the corporation's
shares), it shall be the date the board of directors authorizes the
distribution. A determination of shareholders entitled to notice of or to vote
at a shareholders' meeting shall be effective for any adjournment of the meeting
unless the board of directors fixes a new record date, which it must do if the
meeting is adjourned to a date more than one hundred twenty (120) days after the
date fixed for the original meeting.
SECTION 6. Voting Lists. After fixing a record date for a meeting, the
corporation shall prepare an alphabetical list of the names of all its
shareholders who are entitled to
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notice of a shareholders' meeting. The list must be arranged by voting group
(and within each voting group by class or series of shares) and show the address
of and number of shares held by each shareholder.
The shareholders' list must be available for inspection by any shareholder
beginning two (2) business days after notice of the meeting is given for which
the list was prepared and continuing through the meeting, at the corporation's
principal office or at a place identified in the meeting notice in the city
where the meeting will be held. A shareholder, his agent or attorney shall be
entitled on written demand to inspect and, subject to the requirements of
applicable law, to copy the list during regular business hours and at his
expense, during the period it shall be available for inspection. The corporation
shall make the shareholders' list available at the meeting, and any shareholder,
his agent or attorney shall be entitled to inspect the list at any time during
the meeting or any adjournment.
SECTION 7. Quorum. Shares entitled to vote as a separate voting group may
take action on a matter at a meeting only if a quorum of those shares exists
with respect to that matter. Unless the articles of incorporation or applicable
law impose other quorum requirements, a majority of the votes entitled to be
cast on the matter by a voting group, represented in person or by proxy, shall
constitute a quorum of that voting group for action on that matter. If less than
a majority of the outstanding shares are represented at a meeting, a majority of
the shares so represented may adjourn the meeting from time to time without
further notice except as may be required by Article II, Section 4 of these
bylaws or by applicable law. At such adjourned meeting at which a quorum shall
be present or represented, any business may be transacted which might have been
transacted at the meeting as originally noticed. Once a share is represented for
any purpose at a meeting, it shall be deemed present for quorum purposes for the
remainder of the meeting and for any adjournment of that meeting unless a new
record date is or must be set for that adjourned meeting.
SECTION 8. Proxies. A shareholder may appoint a proxy to vote or otherwise
act for him by signing an appointment form, either personally or by his
attorney-in-fact. An appointment of a proxy shall be effective when received by
the secretary or other officer or agent authorized to tabulate votes of the
corporation. An appointment shall be valid for eleven (11) months unless a
longer period is expressly provided in the appointment form. An appointment of a
proxy shall be revocable by the shareholder unless the appointment form
conspicuously states that it is irrevocable and the appointment shall be coupled
with an interest. Appointments coupled with an interest include the appointment
of (1) a pledgee; (2) a person who purchased or agreed to purchase the shares;
(3) a creditor of the corporation who extended it credit under terms requiring
the appointment; (4) an employee of the corporation whose employment contract
requires the appointment; or (5) a party to a voting agreement created under
applicable law.
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The death or incapacity of the shareholder appointing a proxy does not
affect the right of the corporation to accept the proxy's authority unless
notice of the death or incapacity shall be received by the secretary or other
officer or agent authorized to tabulate votes before the proxy exercises his
authority under the appointment. An appointment made irrevocable because it is
coupled with an interest shall be revoked when the interest with which it is
coupled is extinguished. A transferee for value of shares subject to an
irrevocable appointment may revoke the appointment if he did not know of its
existence when he acquired the shares and the existence of the irrevocable
appointment was not noted conspicuously on the certificate representing the
shares or on the information statement for shares without certificates.
Subject to applicable law and to any express limitation on the proxy's
authority appearing on the face of the appointment form, the corporation shall
be entitled to accept the proxy's vote or other action as that of the
shareholder making the appointment.
SECTION 9. Voting of Shares. Except as provided below or unless the
articles of incorporation provide otherwise, and subject to the provisions of
Section 12 of this Article II, each outstanding share, regardless of class,
shall be entitled to one (1) vote on each matter voted on at a shareholders'
meeting. If a quorum exists, action on a matter (other than the election of
directors) by a voting group shall be approved if the votes cast within the
voting group favoring the action exceed the votes cast opposing the action,
unless the articles of incorporation or applicable law require a greater number
of affirmative votes. Unless otherwise provided in the articles of
incorporation, directors shall be elected by a plurality of the votes cast by
the shares entitled to vote in the election at a meeting at which a quorum is
present.
SECTION 10. Voting of Shares by Certain Holders. Shares standing in the
name of another corporation may be voted by such officer, agent or proxy as the
bylaws of such corporation may prescribe, or, in the absence of such provision,
as the board of directors of such corporation may determine.
Absent special circumstances, shares of this corporation shall not be
entitled to vote if they are owned, directly or indirectly, by a second
corporation, domestic or foreign, and this corporation owns, directly or
indirectly, a majority of the shares of the second corporation entitled to vote
for the directors of the second corporation. This does not limit the power of
this corporation to vote any shares, including its own shares, held by it in a
fiduciary capacity.
Shares held by an administrator, executor, guardian or conservator may be
voted by him, either in person or by proxy, without a transfer of such shares
into his name. Shares standing in the name of a trustee may be voted by him,
either in person or by proxy, but no trustee shall be entitled to vote shares
held by him without a transfer of such shares into his name. Shares standing in
the name of a receiver may be voted by such
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receiver, and shares held by or under the control of a receiver may be voted by
such receiver without the transfer thereof into his name if authority so to do
be contained in an appropriate order of the court by which such receiver was
appointed.
A shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee, and
thereafter the pledgee shall be entitled to vote the shares so transferred.
SECTION 11. Informal Action by Shareholders. Action required or permitted
by applicable law to be taken at a shareholders' meeting may be taken without a
meeting if the action is taken by all the shareholders entitled to vote on the
action. The action must be evidenced by one or more written consents describing
the action taken, signed by all the shareholders entitled to vote on the action,
and delivered to the corporation for inclusion in the minutes or filing with the
corporate records. If not otherwise determined under applicable law, the record
date for determining shareholders entitled to take action without a meeting
shall be the date the first shareholder signs such consent. A consent signed
under this section has the effect of a meeting vote and may be described as such
in any document.
If applicable law requires that notice of proposed action be given to
nonvoting shareholders and the action is to be taken by unanimous consent of the
voting shareholders, the corporation must give its nonvoting shareholders
written notice of the proposed action at least ten (10) days before the action
is taken. The notice must contain or be accompanied by the same material that,
under applicable law, would have been required to be sent to nonvoting
shareholders in a notice of meeting at which the proposed action would have been
submitted to the shareholders for action.
SECTION 12. No Cumulative Voting. Shareholders shall not have the right to
cumulate their votes for directors nor shall the shareholders be entitled to
multiply the number of votes they are entitled to cast by the number of
directors for whom they are entitled to vote and cast the product for a single
candidate or distribute the product among two (2) or more candidates.
SECTION 13. Shares Held by Nominees. The corporation may establish a
procedure by which the beneficial owner of shares that are registered in the
name of a nominee shall be recognized by the corporation as the shareholder. The
extent of this recognition may be determined in the procedure. The procedure may
set forth: (1) the types of nominees to which it applies; (2) the rights or
privileges that the corporation recognizes in a beneficial owner; (3) the manner
in which the procedure shall be selected by the nominee; (4) the information
that must be provided when the procedure is selected; (5) the period for which
selection of the procedure shall be effective; and (6) other aspects of the
rights and duties created.
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SECTION 14. Corporation's Acceptance of Votes. If the name signed on a
vote, consent, waiver or proxy appointment corresponds to the name of the
shareholder, the corporation, if acting in good faith, shall be entitled to
accept the vote, consent, waiver or proxy appointment and give it effect as the
act of the shareholder.
If the name signed on a vote, consent, waiver or proxy appointment does
not correspond to the name of its shareholder, the corporation, if acting in
good faith, shall nevertheless be entitled to accept the vote, consent, waiver
or proxy appointment and give it effect as the act of the shareholder if: (1)
the shareholder is an entity and the name signed purports to be that of an
officer or agent of the entity; (2) the name signed purports to be that of an
administrator, executor, guardian or conservator representing the shareholder
and, if the corporation requests, evidence of fiduciary status acceptable to the
corporation has been presented with respect to the vote, consent, waiver or
proxy appointment; (3) the name signed purports to be that of a receiver or
trustee in bankruptcy of the shareholder and, if the corporation requests,
evidence of this status acceptable to the corporation has been presented with
respect to the vote, consent, waiver or proxy appointment; (4) the name signed
purports to be that of a pledgee, beneficial owner or attorney-in-fact of the
shareholder and, if the corporation requests, evidence acceptable to the
corporation of the signatory's authority to sign for the shareholder has been
presented with respect to the vote, consent, waiver or proxy appointment; (5)
two (2) or more persons are the shareholders as covenants or fiduciaries and the
name signed purports to be the name of at least one (1) of the co-owners and the
person signing appears to be acting on behalf of all the co-owners.
The corporation shall be entitled to reject a vote, consent, waiver or
proxy appointment if the secretary or other officer or agent authorized to
tabulate votes, acting in good faith, has reasonable basis for doubt about the
validity of the signature on it or about the signatory's authority to sign for
the shareholder.
ARTICLE III. BOARD OF DIRECTORS
SECTION 1. General Powers. All corporate powers shall be exercised by or
under the authority of, and the business and affairs of the corporation managed
under the direction of, its board of directors, subject to any limitation set
forth in the articles of incorporation.
SECTION 2. Number, Election, Tenure and Qualifications. The number of
directors of the corporation shall consist of no less than four and no more than
twelve members, the number thereof to be determined by the directors from time
to time. Notwithstanding the foregoing, the number of directors may be increased
to more than twelve to provide for additional directors that holders of any
series or class of preferred stock are entitled to elect pursuant to the terms
thereof, as necessary. Directors are
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elected at the first annual shareholders' meeting and at each annual meeting
thereafter unless their terms are staggered in the articles of incorporation.
The terms of the initial directors of the corporation expire at the first
shareholders' meeting at which directors shall be elected. The terms of all
other directors expire at the next annual shareholders' meeting following their
election unless their terms shall be staggered in the articles of incorporation.
A decrease in the number of directors does not shorten an incumbent director's
term. The term of a director elected to fill a vacancy expires at the next
shareholders' meeting at which directors shall be elected. Despite the
expiration of a director's term, he continues to serve until his successor shall
be elected and qualifies or until there shall be a decrease in the number of
directors. A director need not be a resident of this state or a shareholder of
the corporation.
SECTION 3. Resignation of Directors; Removal of Directors by Shareholders.
(a) A director may resign at any time by delivering written notice to the board
of directors, to its chairman or to the corporation. A resignation shall be
effective when the notice is delivered unless the notice specifies a later
effective date.
(b) The shareholders may remove one or more directors with or without
cause unless the articles of incorporation provide that directors may be removed
only for cause. If a director is elected by a voting group of shareholders, only
the shareholders of that voting group may participate in the vote to remove him.
If cumulative voting is authorized, a director may not be removed if the number
of votes sufficient to elect him under cumulative voting is voted against his
removal. If cumulative voting is not authorized, a director may be removed only
if the number of votes cast to remove him exceeds the number of votes cast not
to remove him. A director may be removed by the shareholders only at a meeting
called for the purpose of removing him and the meeting notice must state that
the purpose, or one (1) of the purposes, of the meeting shall be removal of the
director.
SECTION 4. Regular Meetings. Unless the articles of incorporation or these
bylaws provide otherwise, a regular meeting of the board of directors shall be
held without other notice than this bylaw immediately after, and at the same
place as, the annual meeting of shareholders. In addition, a regular meeting of
the board of directors shall be held at least once every fiscal quarter at such
time as may be fixed by resolution of the board of directors, provided notice of
any such quarterly meeting must be preceded by at least three (3) business days
notice of the date, time and place of the meeting.
SECTION 5. Special Meetings. Special meetings of the board of directors
may be called by or at the request of the chairperson of the board of directors
or any one (1) or more directors. Unless the articles of incorporation or these
bylaws provide for a longer or shorter period, special meetings of the board of
directors must be preceded by at least three (3) business days' notice of the
date, time and place of the meeting. If no place for the meeting has been
designated in the notice, the meeting shall be held at the principal
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office of the corporation. The notice need not describe the purpose of the
regular or special meeting unless required by the articles of incorporation or
these bylaws.
SECTION 6. Place of Meetings. The board of directors may hold regular or
special meetings in or out of this state.
SECTION 7. Quorum. Unless the articles of incorporation or these bylaws
require a greater number, a quorum of the board of directors consists of a
majority of the number of directors in office immediately before the meeting
begins, if the corporation has a variable-range size board. If less than such
number necessary for a quorum shall be present at a meeting, a majority of the
directors present may adjourn the meeting from time to time without further
notice.
SECTION 8. Manner of Acting. If a quorum is present when a vote is taken,
the affirmative vote of a majority of directors present is the act of the board
of directors unless the articles of incorporation or bylaws require the vote of
a greater number of directors.
SECTION 9. Action Without A Meeting. Unless the articles of incorporation
or bylaws provide otherwise, action required or permitted to be taken at a board
of directors' meeting may be taken without a meeting if the action is taken by
all members of the board. The action must be evidenced by one or more written
consents describing the action taken, signed by each director, and included in
the minutes or filed with the corporate records reflecting the action taken.
Action taken under this section shall be effective when the last director signs
the consent, unless the consent specifies a different effective date. Such a
consent has the effect of a meeting vote and may be described as such in any
document.
SECTION 10. Vacancies. Unless the articles of incorporation provide
otherwise, if a vacancy occurs on the board of directors, including a vacancy
resulting from an increase in the number of directors, (i) the shareholders may
fill the vacancy, (ii) the board of directors may fill the vacancy, or (iii) if
the directors remaining in office constitute fewer than a quorum of the board,
they may fill the vacancy by the affirmative vote of a majority of all the
directors remaining in office. If the vacant office was held by a director
elected by a voting group of shareholders, only the holders of shares of that
voting group shall be entitled to fill the vacancy if it is filled by the
shareholders. A vacancy that will occur at a specific later date (by reason of a
resignation effective at a later date or otherwise) may be filled before the
vacancy occurs, but the new director may not take office until the vacancy
occurs.
SECTION 11. Compensation. Unless the articles of incorporation or these
bylaws provide otherwise, the board of directors may fix the compensation of
directors. By resolution of the board of directors, each director may be paid
his expenses, if any, of attendance at each meeting of the board of directors,
and may be paid a stated salary as
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a director or a fixed sum for attendance at each meeting of the board of
directors or both. No such payment shall preclude any director from serving the
corporation in any other capacity and receiving compensation therefor.
SECTION 12. Executive and Other Committees. Unless the articles of
incorporation or bylaws provide otherwise, the board of directors may create an
executive committee and one or more other committees and appoint members of the
board of directors to serve on them. Each committee must have two (2) or more
members, who serve at the pleasure of the board of directors. The creation of a
committee and appointment of members to it must be approved by the greater of
(1) a majority of all the directors in office when the action is taken or (2)
the number of directors required by the articles of incorporation or bylaws to
take action. To the extent specified by the board of directors or in the
articles of incorporation or bylaws, each committee may exercise the authority
of the board of directors. A committee may not, however, authorize
distributions; approve or propose to shareholders action required by applicable
law to be approved by shareholders; fill vacancies on the board of directors or
on any of its committees; amend articles of incorporation, which pursuant to
applicable law the board of directors are authorized to amend; adopt, amend, or
repeal bylaws; approve a plan of merger not requiring shareholder approval;
authorize or approve the reacquisition of shares, except according to a formula
or method prescribed by the board of directors; or authorize or approve the
issuance or sale or contract for sale of shares, or determine the designation
and relative rights, preferences and limitations of a class or series of shares,
except that the board of directors may authorize a committee (or a senior
executive officer of the corporation) to do so within limits specifically
prescribed by the board of directors. Provisions of these bylaws governing
meetings, action without meetings, notice and waiver of notice, and quorum and
voting requirements of the board of directors, apply to committees and their
members as well.
SECTION 13. Participation by Telephonic or Other Means. Unless the
articles of incorporation or these bylaws provide otherwise, the board of
directors may permit any or all directors to participate in a regular or special
meeting by, or conduct the meeting through the use of, any means of
communication by which all directors participating may simultaneously hear each
other during the meeting. A director participating in a meeting by this means
shall be deemed to be present in person at the meeting.
ARTICLE IV. OFFICERS
SECTION 1. Number. The officers of the corporation shall be a chairman of
the board, a president, a vice president, a secretary and a treasurer, each of
whom shall be elected by the board of directors. Such other officers, assistant
officers and agents as may be deemed necessary may be elected or appointed by
the board of directors. Any two or more offices may be held by the same person.
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SECTION 2. Election and Term of Officers. The officers of the corporation
to be elected by the board of directors shall be elected annually by the board
of directors at the regular meeting of the board of directors immediately
following the annual meeting of the shareholders. If the election of officers
shall not be held at such meeting, such election shall be held as soon
thereafter as conveniently may be. Each officer shall continue to serve until
his successor is elected and qualifies or until his death or until he shall
resign or shall have been removed in the manner hereinafter provided.
SECTION 3. Resignation or Removal of Officers and Agents. (a) An officer
or agent may resign at any time by delivering written notice to the board of
directors, to its chairman or to the corporation. A resignation shall be
effective when the notice is delivered unless the notice specifies a later
effective date.
(b) Any officer or agent may be removed by the board of directors whenever
in its judgment, the best interests of the corporation will be served thereby,
but such removal shall be without prejudice to the contract rights, if any, of
the person so removed. Election or appointment of an officer or agent shall not
of itself create contract rights.
SECTION 4. Vacancies. A vacancy in any office because of death,
resignation, removal, disqualification or otherwise, may be filled by the board
of directors for the unexpired portion of the term.
SECTION 5. Chairman of the Board. The chairman of the board shall be the
chief executive officer of the corporation and must be a member of the board of
directors at the time of election to such office. When present he shall preside
at all meetings of the shareholders and of the board of directors. He may sign,
with the president and secretary or any other proper officer of the corporation
thereunto authorized by the board of directors any deeds, mortgages, bonds,
contracts or other instruments which the board of directors has authorized to be
executed, except in cases where the signing and execution thereof shall be
expressly delegated by the board of directors or by these bylaws to some other
officer or agent of the corporation, or shall be required by law to be otherwise
signed or executed; and in general shall perform all duties incident to the
office of chairman of the board and such other duties as may be prescribed by
the board of directors from time to time.
SECTION 6. President. The president shall be the chief operating officer
of the corporation and, subject to the control of the chairman and the board of
directors, shall have general supervision and control of the business and
affairs of the corporation. In the absence of the chairman of the board of
directors, he shall, when present, preside at all meetings of the shareholders
and of the board of directors. He may sign, with the secretary or any other
proper officer of the corporation thereunto authorized by the board of
directors, certificates for shares of the corporation, any deeds, mortgages,
bonds, contracts, or other instruments which the board of directors has
authorized to be executed, except in cases where the signing and execution
thereof shall be expressly delegated by
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the board of directors or by these bylaws to some other officer or agent of the
corporation, or shall be required by law to be otherwise signed or executed; and
in general shall perform all duties incident to the office of president and such
other duties as may be prescribed by the board of directors from time to time.
SECTION 7. Vice President. In the absence of the president or in the event
of his death, inability or refusal to act, the vice president shall perform the
duties of the president, and when so acting, shall have all the powers of and be
subject to all the restrictions upon the president. The vice president shall
perform such other duties as from time to time may be assigned to him by the
president or by the board of directors.
SECTION 8. Secretary. The secretary shall (a) prepare and keep the minutes
of the directors' and shareholders' meetings in one or more books provided for
that purpose; (b) see that all notices are duly given in accordance with the
provisions of these bylaws or as required by law; (c) be custodian of the
corporate records and of the seal of the corporation and see that the seal of
the corporation is affixed to all documents the execution of which on behalf of
the corporation under its seal is duly authorized; (d) authenticate records of
the corporation; (e) keep a register of the post office address of each
shareholder which shall be furnished to the secretary by such shareholder; (f)
sign with the president, certificates for shares of the corporation, the
issuance of which shall have been authorized by resolutions of the board of
directors; (g) have general charge of the stock transfer books of the
corporation; (h) in general perform all duties incident to the office of
secretary and such other duties as from time to time may be assigned to him by
the president or by the board of directors.
SECTION 9. Treasurer. The treasurer shall: (a) have charge and custody of
and be responsible for all funds and securities of the corporation; (b) receive
and give receipts for monies due and payable to the corporation from any source
whatsoever, and deposit all such monies in the name of the corporation in such
banks, trust companies or other depositories as shall be selected in accordance
with these bylaws; and (c) in general perform all of the duties incident to the
office of treasurer and such other duties as from time to time may be assigned
to him by the president or by the board of directors. If required by the board
of directors, the treasurer shall give a bond for the faithful discharge of his
duties in such sum and with such surety or sureties as the board of directors
shall determine.
SECTION 10. Compensation. The board of directors may fix the compensation
of the officers. No such payment shall preclude any officer from serving the
corporation in any other capacity and receiving compensation therefor.
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ARTICLE V. CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1. Contracts. The board of directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute and deliver any
instrument in the name of and on behalf of the corporation, and such authority
may be general or confined to specific instances.
SECTION 2. Loans. No loans shall be contracted on behalf of the
corporation and no evidences of indebtedness shall be issued in its name unless
authorized by a resolution of the board of directors. Such authority may be
general or confined to specific instances.
SECTION 3. Checks, Drafts, Etc. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation, shall be signed by such officer or officers, agent or agents of
the corporation and in such manner as shall from time to time be determined by
resolution of the board of directors.
SECTION 4. Deposits. All funds of the corporation not otherwise employed
shall be deposited from time to time to the credit of the corporation in such
banks, companies or other depositories as the board of directors may select.
ARTICLE VI. CERTIFICATES FOR SHARES AND THEIR TRANSFER
SECTION 1. Certificates for Shares. Shares shall be represented by
certificates. Certificates representing shares of the corporation shall be in
such form as shall be determined by the board of directors. At a minimum, each
share certificate must state on its face (1) the name of the corporation and
that the corporation is organized under the law of the State of Mississippi; (2)
the name of the person to whom issued; and (3) the number and class of shares
and the designation of the series, if any, the certificate represents. If the
corporation is authorized to issue different classes of shares or different
series within a class, the designations, relative rights, preferences and
limitations applicable to each class and the variations in rights, preferences
and limitations determined for each series (and the authority of the board of
directors to determine variations for future series) must be summarized on the
front or back of each certificate or the corporation must furnish the
shareholder this information on request in writing and without charge.
Each share certificate must be signed (either manually or in facsimile) by
the president or a vice president and by the secretary or an assistant secretary
or by such other officers designated in the bylaws or by the board of directors
so to do, and may be sealed with the corporate seal. If the person who signed
(either manually or in facsimile) a share certificate no longer holds office
when the certificate is issued, the certificate is nevertheless valid.
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All certificates for shares shall be consecutively numbered or otherwise
identified. The name and address of the person to whom the shares represented
thereby are issued, with the number of shares and date of issue, shall be
entered on the stock transfer books of the corporation. All certificates
surrendered to the corporation for transfer shall be cancelled and no new
certificate shall be issued until the former certificate for a like number of
shares shall have been surrendered and cancelled, except that in the case of a
lost, destroyed, or mutilated certificate a new one may be issued therefor upon
such terms and indemnity to the corporation as the board of directors may
prescribe.
SECTION 2. Transfer of Shares. Transfer of shares of the corporation shall
be made only on the stock transfer books of the corporation by the holder of
record thereof or by his legal representative, who shall furnish proper evidence
of authority to transfer or by his attorney thereunto authorized by power of
attorney duly executed and filed with the secretary of the corporation, and on
surrender for cancellation of the certificate for such shares.
ARTICLE VII. INDEMNIFICATION
SECTION 1. Definitions. In this article:
(1) "Corporation" includes this corporation and any domestic or foreign
predecessor entity of the corporation in a merger or other transaction in which
the predecessor's existence ceased upon consummation of the transaction.
(2) "Director" means an individual who is or was a director of the
corporation or an individual who, while a director of the corporation, is or was
serving at the corporation's request as a director, officer, partner, trustee,
employee or agent of another foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise. A director shall be
considered to be serving an employee benefit plan at the corporation's request
if his duties to the corporation also impose duties on, or otherwise involve
services by, him to the plan or to participants in or beneficiaries of the plan.
"Director" includes, unless the context requires otherwise, the estate or
personal representative of a director.
(3) "Expenses" include counsel fees.
(4) "Liability" means the obligation to pay a judgment, settlement,
penalty, fine (including an excise tax assessed with respect to an employee
benefit plan), or reasonable expenses incurred with respect to a proceeding.
(5) "Official capacity" means: (i) when used with respect to a director,
the office of director in the corporation; and (ii) when used with respect to an
individual other than a director as contemplated in Article VII, Section 7, the
office in the corporation held by the officer or the employment or agency
relationship undertaken by the employee or agent on
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behalf of the corporation. "Official capacity" does not include service for any
other foreign or domestic corporation or any partnership, joint venture, trust,
employee benefit plan or other enterprise.
(6) "Party" includes an individual who was, is, or is threatened to be
made a named defendant or respondent in a proceeding.
(7) "Proceeding" means any threatened, pending, or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative and
whether formal or informal.
SECTION 2. Authority to Indemnify. (a) Except as provided in subsection
(d), the corporation shall indemnify any individual made a party to a proceeding
because he is or was a director against liability incurred in the proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed:
(i) In the case of conduct in his official capacity with the
corporation, that his conduct was in its best interests; and
(ii) In all other cases, that his conduct was at least not opposed
to its best interests; and
(3) In the case of any criminal proceeding, he had no reasonable cause to
believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for a
purpose he reasonably believed to be in the interest of the participants in and
beneficiaries of the plan is conduct that satisfies the requirement of
subsection (a)(2)(ii).
(c) The termination of a proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent is not, of
itself, determinative that the director did not meet the standard of conduct
described in this section.
(d) The corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation; or
(2) In connection with any other proceeding charging improper
personal benefit to him, whether or not involving action in
his official capacity,
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in which he was adjudged liable on the basis that personal
benefit was improperly received by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation shall be limited to reasonable
expenses incurred in connection with the proceeding.
SECTION 3. Mandatory Indemnification. Unless limited by the articles of
incorporation, the corporation shall indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any proceeding to
which he was a party because he is or was a director of the corporation against
reasonable expenses incurred by him in connection with the proceeding.
SECTION 4. Advance for Expenses. (a) The corporation shall pay for or
reimburse the reasonable expenses incurred by a director who is a party to a
proceeding in advance of final disposition of the proceeding if:
(1) The director furnishes the corporation a written affirmation
of his good faith belief that he has met the standard of
conduct described in Article VII, Section 2;
(2) The director furnishes the corporation a written undertaking,
executed personally or on his behalf, to repay the advance if
it shall be ultimately determined that he did not meet the
standard of conduct; and
(3) A determination shall be made that the facts then known to
those making the determination would not preclude
indemnification under this Article.
(b) The undertaking required by subsection (a) (2) must be an unlimited
general obligation of the director but need not be secured and may be accepted
without reference to financial ability to make repayment.
(c) Determination and authorizations of payments under this section shall
be made in the manner specified in Article VII, Section 6.
SECTION 5. Court Ordered Indemnification. Unless the corporation's
articles of incorporation provide otherwise, a director of the corporation who
is a party to a proceeding may apply for indemnification to the court conducting
the proceeding or to another court of competent jurisdiction.
SECTION 6. Determination and Authorization of Indemnification. (a) The
corporation may not indemnify a director under Article VII, Section 2 unless
authorized in
15
<PAGE>
the specific case after a determination has been made that
indemnification of the director shall be permissible in the
circumstances because he has met the standard of conduct set
forth in Article VII, Section 2.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum
consisting of directors not at the time parties to the
proceeding;
(2) If a quorum cannot be obtained under subsection (b)(1), by
majority vote of a committee duly designated by the board of
directors (in which designation directors who are parties may
participate), consisting solely of two (2) or more directors
not at the time parties to the proceeding;
(3) By special legal counsel:
(i) Selected by the board of directors or its committee in
the manner prescribed in subsection (b)(1) or (b)(2); or
(ii) If a quorum of the board of directors cannot be obtained
under subsection (b)(1) and a committee cannot be
designated under subsection (b)(2), selected by a
majority vote of the full board of directors (in which
selection directors who are parties may participate); or
(4) By the shareholders, but shares owned by or voted under the
control of directors who are at the time parties to the
proceeding may not be voted on the determination.
(c) Authorization of indemnification and evaluation as to reasonableness
of expenses shall be made in the same manner as the determination that
indemnification shall be permissible, except that if the determination shall be
made by special legal counsel, authorization of indemnification and evaluation
as to reasonableness of expenses shall be made by those entitled under
subsection (b)(3) to select counsel.
(d) The corporation agrees to submit requests for indemnification or
advancement of expenses to the board of directors of the corporation or to the
shareholders of the corporation, as applicable, within a reasonable time after
the director requests in writing that the corporation indemnify the director or
advance expenses to him.
SECTION 7. Indemnification of Officers, Employees and Agents. Unless the
corporation's articles of incorporation provide otherwise:
16
<PAGE>
(1) An officer of the corporation who is not a director shall be entitled
to mandatory indemnification under Article VII, Section 3, and shall be entitled
to apply for court-ordered indemnification under Article VII, Section 5, in each
case to the same extent as a director;
(2) The corporation shall indemnify and advance expenses under this
article to an officer, employee or agent of the corporation who is not a
director to the same extent as to a director; and
(3) The corporation shall also indemnify and advance expenses to an
officer, employee or agent who is not a director to the extent, consistent with
public policy, that may be provided by the articles of incorporation, bylaws,
general or specific action of the board of directors or contract.
SECTION 8. Right of Corporation to Insure. The corporation may purchase
and maintain insurance on behalf of an individual who is or was a director,
officer, employee or agent of the corporation or who, while a director, officer,
employee or agent of the corporation, is or was serving at the request of the
corporation as a director, officer, partner, trustee, employee or agent of
another foreign or domestic corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, against liability asserted against or
incurred by him in that capacity or arising from his status as a director,
officer, employee or agent, whether or not the corporation would have power to
indemnify him against such liability under Article VII, Sections 2 or 3 or
applicable law.
SECTION 9. Application of Article. (a) Unless the articles of
incorporation or these bylaws provide otherwise, any authorization of
indemnification in the articles of incorporation or these bylaws shall not be
deemed to prevent the corporation from providing the indemnity permitted or
mandated by applicable law.
(b) The board of directors of the corporation shall have power to make any
further indemnity, including advance of expenses, to and to enter contracts of
indemnity with any director, officer, employee or agent, except an indemnity
against his gross negligence or willful misconduct. Any determination as to any
further indemnity shall be made in accordance with subsection (b) of Article
VII, Section 6. Each such indemnity may continue as to a person who has ceased
to have the capacity referred to above and may inure to the benefit of the
heirs, executors and administrators of such person.
(c) The corporation shall pay or reimburse expenses incurred by a director
in connection with his appearance as a witness in a proceeding at a time when he
has not been made a named defendant or respondent to the proceeding when his
appearance as a witness is in connection with his serving as a director of the
corporation.
SECTION 10. Right to Bring Action to Enforce. The rights to
indemnification and to the advancement of expenses conferred under this article
shall be contract rights. If a
17
<PAGE>
claim under this article is not paid in full by the corporation within 90 days
after a written claim has been received by the corporation, the director making
such claim may at any time thereafter bring suit against the corporation to
recover the unpaid amount of the claim and, if successful in whole or in part,
the director shall be entitled to be paid also the expense of prosecuting such
claim. It shall be a defense to any such action that the director has not met
the standards of conduct which make it permissible under this article or the
laws of the State of Mississippi for the corporation to indemnify the director
for the amounts claimed, but the burden of proving such defense shall be on the
corporation. Neither the failure of the corporation (including its board of
directors, independent legal counsel, or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the director shall be proper in the circumstances because he has met the
applicable standard of conduct set forth under the laws of the State of
Mississippi or under this Agreement, nor an actual determination by the
corporation (including its board of directors, independent legal counsel, or its
shareholders) that the director had not met such applicable standard of conduct,
shall be a defense to the action or create a presumption that the director had
not met the applicable standard of conduct.
ARTICLE VIII. NOTICE
Notice shall be in writing unless oral notice is reasonable under the
circumstances. Notice may be communicated in person; by telephone, telegraph,
teletype or other form of wire or wireless communication; or by mail or private
carrier. If these forms of personal notice shall be impracticable, notice may be
communicated by a newspaper of general circulation in the area where published;
or by radio, television or other form of public broadcast communication.
Written notice to shareholders, if in a comprehensible form, shall be
effective when mailed, if mailed postpaid and correctly addressed to the
shareholder's address shown in the corporation's current record of shareholders.
Except as provided above with respect to notice to shareholders, written
notice, if in a comprehensible form, shall be effective at the earliest of the
following:
(1) When received;
(2) Five (5) days after its deposit in the United States mail, as
evidenced by the postmark, if mailed postpaid and correctly addressed;
(3) On the date shown on the return receipt, if sent by registered or
certified mail, return receipt requested, and the receipt is signed by or on
behalf of the addressee.
18
<PAGE>
Oral notice shall be effective when communicated if communicated in a
comprehensible manner.
If applicable law prescribes notice requirements for particular
circumstances, those requirements govern. If the articles of incorporation or
these bylaws prescribe notice requirements, not inconsistent with this section
or other provisions of applicable law, those requirements govern.
ARTICLE IX. WAIVER OF NOTICE; ASSENT TO ACTIONS
Unless otherwise provided by law, a shareholder or director of the
corporation may waive any notice required by applicable law, the articles of
incorporation or these bylaws, before or after the date and time stated in the
notice. Except as provided below, the waiver must be in writing, be signed by
the shareholder or director entitled to the notice, and delivered to the
corporation for inclusion in the minutes or filing with the corporate records.
A director's attendance at or participation in a meeting waives any
required notice to him of the meeting unless the director at the beginning of
the meeting (or promptly upon his arrival) objects to holding the meeting or
transacting business at the meeting and does not thereafter vote for or assent
to action taken at the meeting. A shareholder's attendance at a meeting (i)
waives objection to lack of notice or defective notice of the meeting unless the
shareholder at the beginning of the meeting objects to holding the meeting or
transacting business at the meeting, and (ii) waives objection to consideration
of a particular matter at the meeting that is not within the purpose or purposes
described in the meeting notice, unless the shareholder objects to considering
the matter when it is presented.
A director who is present at a meeting of the board of directors or a
committee of the board of directors when corporate action is taken shall be
deemed to have assented to the action taken unless: (1) he objects at the
beginning of the meeting (or promptly upon his arrival) to holding it or
transacting business at the meeting; (2) his dissent or abstention from the
action taken shall be entered in the minutes of the meeting; or (3) he delivers
written notice of his dissent or abstention to the presiding officer of the
meeting before its adjournment or to the corporation immediately after
adjournment of the meeting. The right of dissent or abstention shall not be
available to a director who votes in favor of the action taken.
ARTICLE X. EMERGENCY BYLAWS
The emergency bylaws provided in this article shall be operative during
any emergency in the conduct of the business of the corporation, notwithstanding
any different
19
<PAGE>
provision in the preceding articles of the bylaws or in the articles of
incorporation of the corporation or in the Mississippi Business Corporation Act.
An emergency exists if a quorum of the corporation's directors cannot readily be
assembled because of some catastrophic event. To the extent not inconsistent
with the provisions of this article, the bylaws provided in the preceding
articles shall remain in effect during such emergency and upon its termination
the emergency bylaws shall cease to be operative.
During any such emergency:
(a) A meeting of the board of directors may be called by any officer or
director of the corporation. Notice of the meeting shall be given by the officer
or director calling the meeting only to those directors whom it is practicable
to reach and may be given in any practicable manner, including by publication
and radio.
(b) One or more officers of the corporation present at a meeting of the
board of directors may be deemed to be directors for the meeting, in order of
rank and within the same rank in order of seniority, as necessary to achieve a
quorum.
(c) The board of directors, either in anticipation of or during any such
emergency, may modify lines of succession to accommodate the incapacity of any
director, officer, employee or agent.
(d) The board of directors, either in anticipation of or during any such
emergency, may relocate the principal offices or regional offices, or authorize
the officers to do so.
Corporate action taken in good faith during an emergency under this
section to further the ordinary business affairs of the corporation binds the
corporation and may not be used to impose liability on a corporate director,
officer, employee or agent.
These emergency bylaws shall be subject to repeal or change by further
action of the board of directors or by action of the shareholders, but no such
repeal or change shall modify the provisions of the next preceding paragraph
with regard to action taken prior to the time of such repeal or change. Any
amendment of these emergency bylaws may make any further or different provision
that may be practical and necessary for the circumstances of the emergency.
ARTICLE XI. DISTRIBUTIONS
The board of directors may authorize and the corporation may make
distributions to its shareholders, subject to restriction by the articles of
incorporation and applicable law.
20
<PAGE>
ARTICLE XII. CORPORATE SEAL
The board of directors shall provide a corporate seal which shall be
circular in form and shall have inscribed thereon the name of the corporation
and the state of incorporation and the words "Corporate Seal".
ARTICLE XIII. AMENDMENTS
Unless the articles of incorporation, applicable law or a resolution of
the shareholders reserves this power exclusively to the shareholders in whole or
part, the corporation's board of directors may amend or repeal these bylaws and
adopt new bylaws at any regular or special meeting of the board of directors.
ACCEPTED THIS _____ day of ____________________, 1996.
By: ________________________________
TITLE:
21
<PAGE>
Exhibit 3.9
RECORD OF CHARTERS, 46-47, STATE OF MISSISSIPPI
- --------------------------------------------------------------------------------
MISSISSIPPI, PTG. CO. VICKSBURG 27930
- --------------------------------------------------------------------------------
No. 123 W THE CHARTER OF INCORPORATION OF
SOUTHERN JITNEY JUNGLE COMPANY
1. The corporate title of said company is Southern Jitney Jungle Company.
2. The names of the incorporators are:
W. H. Holman Postoffice Jackson, Miss.
Elise M. Holman Postoffice Jackson, Miss.
W. B. McCarty Postoffice Jackson, Miss.
Elizabeth A. McCarty Postoffice Jackson, Miss.
J. M. Holman Postoffice Jackson, Miss.
Charline G. Holman Postoffice Jackson, Miss.
3. The domicile is at Jackson, Mississippi.
4. Amount of capital stock and particulars as to class or classes thereof:
$50,000.00 of capital stock, all of the same class.
5. Number of shares for each class and par value thereof: 500 shares
capital stock, all of the same class, having a par value of $100.00 per share.
6. The period of existence (not to exceed fifty years) is 50 years.
7. The purpose for which it is created: To acquire by purchase, or
otherwise, to own and operate a chain of retail grocery stores and markets in
various cities and towns in the state of Mississippi, and elsewhere, together
with such bakery, delicatessen, lunch counter, or lunch room departments as may
be desirable; and to buy, own, hold, lease, improve, enlarge and use such real
estate and personal property, and to construct such buildings as may be
necessary or useful in the conduct of such business, and to sell, mortgage or
hypothecate the same, and generally to do and perform all such acts, and enter
into and perform such contracts, and to borrow such money, with security or
otherwise as may be usual, incident or necessary to the business aforesaid.
The rights and powers that may be exercised by this corporation, in
addition to the foregoing, are those conferred by Chapter 4, Title 21, Code of
Mississippi of 1942, and amendments thereto.
8. Number of Shares of each class to be subscribed and paid for before the
corporation may begin business.
100 shares of capital stock, all of the same class.
W. B. McCarty
Charline G. Holman
Elise M. Holman
J. M. Holman
W. H. Holman
Elizabeth A. McCarty Incorporators
ACKNOWLEDGMENT
STATE OF MISSISSIPPI )
COUNTY OF HINDS. )
This day personally appeared before me, the undersigned authority in
and for said county and state, W. H. Holman, Elise M. Holman, W. B. McCarty,
Elizabeth A. McCarty, J. M. Holman and Charline G. Holman incorporators of the
corporation known as the Southern Jitney Jungle Company who acknowledged that
(they) signed and executed the above and foregoing articles of incorporation as
(their) act and deed on this the 24th day of April, 1946.
(SEAL OF NOTARY PUBLIC) Eckford Bell, Notary Public
My Commission Expires April 22, 1947.
Received at the office of the Secretary of State this the 24th day of
April, A. D., 1946, together with the sum of $110.00 deposited to cover the
recording fee, and referred to the Attorney General for his opinion.
Walker Wood, Secretary of State
Jackson, Miss., April 25th, 1946.
I have examined this charter of incorporation and am of the opinion
that it is not violative of the Constitution and laws of the state, or of the
United States.
Greek L. Ride, Attorney General
By W. B. Fontaine, Assistant Attorney General
STATE OF MISSISSIPPI
EXECUTIVE OFFICE, JACKSON.
The within and foregoing Charter of Incorporation of SOUTHERN JITNEY
JUNGLE COMPANY is hereby approved.
(GREAT SEAL) In testimony whereof, I have hereunto set my hand and caused
the Great Seal of the State of Mississippi to be affixed, this
Twenty-fifth day of April, 1946.
By the Governor: Thos. L. Bailey, GOVERNOR
Walker Wood, Secretary of State
Recorded: April 25th, 1946.
<PAGE>
See File $20.00 702203
================================================================================
State of Mississippi
[SEAL]
Office of Secretary of State
Jackson
CERTIFICATE OF AMENDMENT
of
SOUTHERN JITNEY JUNGLE COMPANY
The undersigned, as Secretary of State of the State of Mississippi, hereby
certifies that duplicate originals of Articles of Amendment to the Articles of
Incorporation of the above corporation duly signed and verified pursuant to the
provisions of the Mississippi Business Corporation Act, have been received in
this office and are found to conform to law.
ACCORDINGLY the undersigned, as such Secretary of State, and by virtue of
the authority vested in him by law, hereby issues this Certificate of Amendment
to the Articles of Incorporation and attaches hereto a duplicate original of the
Articles of Amendment.
Given under my hand and Seal of Office,
this the 26th day of June 1986.
Seal
/s/ [Illegible]
SECRETARY OF STATE.
C-11
================================================================================
<PAGE>
FILED
JUN 26, 1986
Dick Molpus
SECRETARY
OF STATE
(TO BE EXECUTED IN DUPLICATE)
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
SOUTHERN JITNEY JUNGLE COMPANY
Pursuant to the provisions of Section 61 of Mississippi Business
Corporation Act, the undersigned corporation adopts the following Articles of
Amendment to its Articles of Incorporation:
FIRST: The name of this corporation is Southern Jitney Jungle Company.
SECOND: The following amendment of the Articles of Incorporation was
adopted by the shareholders of the corporation on June 25, 1986 in the manner
prescribed by the Mississippi Business Corporation Act:
(Insert Amendment)
"The corporation elects not to be governed by the Mississippi
Shareholder Protection Act, Mississippi Code Annotated Section
79-25-1."
THIRD: The number of shares of the corporation outstanding at the time of
such adoption was 489 and the number of shares entitle to vote thereon was
489.
FOURTH: The designation and number of outstanding shares of each class
entitled to vote thereon as a class were as follows:
Class (Note 1) Number of Shares
None
C-10 -1-
<PAGE>
FIFTH: The number of shares voted for such amendment was 471; and the
number of shares voted against such amendment was 0.
SIXTH: The number of shares of each class entitled to vote thereon as a
class voted for and against such amendment; respectively, was:
Number of Shares Voted
Class (Note 1) For Against
None
SEVENTH: The manner, if not set forth in such amendment, in which any
exchange, reclassification, or cancellation of issued shares provided for in the
amendment shall be effected, is as follows: (Note 2)
No Change
EIGHTH: The manner in which such amendment effects a change in the amount
of stated capital, and the amount of stated capital (expressed in dollars) as
changed by such amendment, are as follows: (Note 2)
No Change
Dated June 25, 1986 Southern Jitney Jungle Company
-----------------------------------
(Exact Corporate Title)
By /s/ W.H. Holman, Jr.
-------------------------------
Its ____________ President
Notes: 1. If inapplicable, insert "None",
2. If inapplicable, insert "No Change".
By /s/ Roger P. Friou
-------------------------------
Its ____________ Secretary
STATE OF MISSISSIPPI }
} SS.
COUNTY OF HINDS }
I, Lora Dean, a notary public, do hereby certify that on this 25th day of
June, 1986, personally appeared before me W.H. Holman, Jr., who, being by me
first duly sworn, declared that he is the President of Southern Jitney Jungle
Company, that he executed the foregoing document as President of the
corporation, and that the statements therein contained are true.
/s/ Lora Dean
----------------------------------
Notary Public
My commission expires My Commission Expires Sept. 16, 1988
(NOTARIAL SEAL)
C-10 -2-
<PAGE>
STATE OF MISSISSIPPI }
} SS.
COUNTY OF HINDS }
I, Lora Dean, a notary public, do hereby certify that on this 25th day of
June, 1986, personally appeared before me Roger P. Friou, who, being by me first
duly sworn, declared that he is the Secretary of Southern Jitney Jungle Company,
that he executed the foregoing document as Secretary of the corporation, and
that the statements therein contained are true.
/s/ Lora Dean
----------------------------------
Notary Public
My commission expires My Commission Expires Sept. 16, 1988
(NOTARIAL SEAL)
<PAGE>
[Illegible]
<PAGE>
228213
ARTICLES OF AMENDMENT
(Attach conformed copy)
|X| PROFIT |_| NONPROFIT
(Mark appropriate box)
The undersigned corporation, pursuant to Section 79-4-10.06 (if a profit
corporation) or Section 79-11-305 (if a nonprofit corporation) of the
Mississippi Code of 1972, hereby executes the following document and sets forth:
1. The name of the corporation is Southern Jitney Jungle Company
2. Set forth the text of each amendment adopted. (Attach page.)
3. If a profit amendment provides for an exchange, reclassification, or
cancellation of issued shares, set forth the provisions for implementing
the amendment if they are not contained in the amendment itself. (Attach
page.)
4. The amendment(s) was (were) adopted July 20, 1986 by Shareholders on
Board's recommendation
FOR PROFIT CORPORATION
(a) adopted by |_| the incorporators |_| directors without shareholder
action and shareholder action was not required. (Check appropriate
box.)
FOR NONPROFIT CORPORATION
(b) adopted by |_| board of directors |_| incorporators without member
action and member action was not required. (Check appropriate box.)
FOR PROFIT CORPORATIONS
5. If the amendment was approved by shareholders:
(a) The designation, number of outstanding shares, number of votes
entitled to be cast by each voting group entitled to vote separately
on the amendment, and the number of votes of each voting group
indisputably represented at the meeting was:
No. outstanding No. of votes No. of votes
Designation shares entitled to be cast indisputably represented
----------- --------------- ------------------- ------------------------
All Common Stock 491 491 413
- ---------------- --------------- ------------------- ------------------------
- ---------------- --------------- ------------------- ------------------------
(b) Either the total number of votes cast for and against the amendment
by each voting group entitled to vote separately on the amendment
was:
Total no. of Total no. of
Voting group votes cast FOR votes cast AGAINST
------------ -------------- ------------------
All Common Stock 413 0
--------------------- --------------------- ------------------
--------------------- --------------------- ------------------
or the total number of undisputed votes cast for the amendment by
each voting group was:
Total no. of undisputed
Voting group vote cast FOR the plan
------------ ----------------------
-------------------- ----------------------------
-------------------- ----------------------------
and the number cast for the amendment by each voting group was sufficient
for approval by that voting group.
FOR NONPROFIT CORPORATIONS
6. If the amendment was approved by the members:
(a) The designation, number of memberships outstanding, number of votes
entitled to be cast by each class entitled to vote separately on the
amendment, and number of votes of each class indisputably
represented at the meeting was:
No. memberships No. of votes No. of votes
Designation outstanding entitled to be cast indisputably represented
----------- --------------- ------------------- ------------------------
- ---------------- --------------- ------------------- ------------------------
- ---------------- --------------- ------------------- ------------------------
(b) Either
(i) the total number of votes cast for and against the amendment
by each class entitled to vote separately on the amendment
was:
Total no. of votes cast Total no. of votes cast
Voting class FOR the amendment AGAINST the amendment
------------ ----------------------- -----------------------
--------------------- ------------------------ ------------------------
--------------------- ------------------------ ------------------------
or
(ii) the total number of undisputed votes cast for the amendment by
each class was:
Total no. of
undisputed votes cast
Voting group FOR the amendment
------------ ---------------------
-------------------- ----------------------------
-------------------- ----------------------------
and the number cast for the amendment by each class was sufficient for
approval by that voting group.
BY Roger P. Friou, Executive Vice-President & Secretary /s/ Roger P. Friou
-----------------------------------------------------------------------------
PRINTED NAME/CORPORATE TITLE SIGNATURE
<PAGE>
[Letterhead of Elise V. Williams]
August 3, 1988
Secretary of State
Corporations Division
P.O. Box 136
Jackson, MS 39205
Dear Sir:
Enclosed please find an original and two copies of the Articles of
Amendment for Southern Jitney Jungle Company and a check payable to the
Secretary of State in the amount of Fifty Dollars ($50.00).
If everything is in order, please return a conformed copy to me.
Thank you for your assistance in this matter.
Sincerely,
/s/ Elise V. Williams
Elise V. Williams
EVW:mc
Encls.
<PAGE>
ARTICLES OF AMENDMENT
PROFIT
The undersigned corporation, pursuant to Section 79-4-10.06 of the
Mississippi Code of 1972, hereby executes the following document and sets forth:
1. The name of the corporation is Southern Jitney Jungle Company.
2. The text of the amendment adopted to Article 6 is attached as Exhibit "A".
3. The amendment was adopted October 16, 1991.
4. The amendment was adopted by the board of directors without shareholder
action, and shareholder action was not required.
5. The text of the amendment adopted as Article 10 is attached as Exhibit
"B".
6. The amendment was adopted October 16, 1991.
7. (a) The designation, number of outstanding shares, number of votes
entitled to be cast by each voting group entitled to vote separately on
the amendment, and the number of votes of each voting group indisputably
represented at the meeting was:
No. of Votes No. of Votes
Designation No. Outstanding Entitled to be Indisputably
of Shares Shares Cast Represented
- ------------ --------------- -------------- ------------
Common stock 4910 4910 4070
(b) The total number of votes cast for and against the amendment by each
voting group entitled to vote separately on the amendment was:
Total No. of Total No. of Votes
Voting Group Votes Cast FOR Cast AGAINST
- ------------- -------------- ------------------
Common stock 4070 -0-
----------------------
Time: 8:00 A.M.
Amount Received:
$50.00
Filed 12/12/91
[Illegible]
--------------------
Secretary of State
State of Mississippi
----------------------
<PAGE>
DATED: November 29, 1991.
SOUTHERN JITNEY JUNGLE COMPANY
BY: /s/ Roger P. Friou
----------------------------------
Roger P. Friou
Vice Chairman of the Board, Chief
Financial Officer and Secretary
2
<PAGE>
EXHIBIT "A"
to
ARTICLES OF AMENDMENT
SOUTHERN JITNEY JUNGLE COMPANY
6. The duration of the corporation is perpetual.
<PAGE>
EXHIBIT "B"
TO
ARTICLES OF AMENDMENT
SOUTHERN JITNEY JUNGLE CORPORATION
10. A director of the corporation shall not be liable to the corporation or its
shareholders for monetary damages for any action taken, or any failure to
take action, as a director, except liability for: (i) the amount of a
financial benefit received by a director to which he is not entitled; (ii)
an intentional infliction of harm on the corporation or the shareholders;
(iii) a violation of Miss. Code Ann. Section 79-4-833 (1972), as amended;
or (iv) an intentional violation of criminal law. No amendment or repeal
of this article shall apply to or have any effect on the liability or
alleged liability of any director of the corporation for or concerning any
action by a director occurring prior to such amendment or repeal.
<PAGE>
RESOLUTION
At the annual meeting of the stockholders of Southern Jitney Jungle
Company, held at its office in the City of Jackson, Mississippi on July 20,
1988, pursuant to due notice, of which stockholders representing a majority of
issued and outstanding stock were present, on motion, duly seconded, the
following Resolution, the adoption of which was recommended to the stockholders
by the Board of Directors of this Corporation, was unanimously adopted:
RESOLVED, that the second and third lines of Paragraph No. 5 of the
Charter of Incorporation of Southern Jitney Jungle Company be
amended to read "Five Thousand (5000) shares of capital stock, all
of the same class, having a par value of Ten Dollars ($10.00) per
share"; that each share of common stock issued and outstanding be
split into ten common shares through a share dividend, with each
share having a par value of Ten Dollars ($10.00); that the proper
officers of the corporation are hereby authorized to make,
subscribe, acknowledge and execute and file or cause to be filed,
such certificate or certificates as may be required under the
Mississippi Business Corporation "Act for the purpose of effecting
the foregoing changes; and that the Board of Directors do or cause
to be done such other acts and things as in its discretion may be
necessary or advisable in connection with said split effect in the
form of a dividend.
<PAGE>
F0013 - Page 1 of 3 OFFICE OF THE MISSISSIPPI SECRETARY OF STATE
P.O. BOX 136, JACKSON, MS 39205-0136 (601) 359-1333
[Bar Code] Articles of Merger or Share Exchange
Profit Corporation
The undersigned corporation pursuant to Section 79-4-11.05, as amended, hereby
executes the following document and sets forth:
1. Name of Corporation 1
--------------------------------------------------------------------------
==> McLemore's Wholesale & Retail Stores, Inc.
--------------------------------------------------------------------------
2. Name of Corporation 2
--------------------------------------------------------------------------
==> Southern Jitney Jungle Company
--------------------------------------------------------------------------
3. Name of Corporation 3
--------------------------------------------------------------------------
==>
--------------------------------------------------------------------------
FILED
Mar 01 1996
ERIC CLARK
Secretary of State
State of Mississippi
---------------------------
4. The future effective date is March 5, 1996 at 9:00 a.m.,
(Complete if applicable) Central Standard Time
---------------------------
5. The plan of merger or share exchange. (Attach page)
6. Mark appropriate box.
------
==> X (a) Shareholder approval of the plan of merger or share exchange
was not required.
------
OR
------
==> (b) If approval of the shareholders of one or more corporations
party to the merger or share exchange was required
------
(i) the designation, number of outstanding shares, and
number of votes entitled to be cast by each class
entitled to vote separately on the plan as to each
corporation were
Name of Corporation Designation No. of outstanding No. of votes
shares entitled to be cast
------------------- ----------- ------------------ -------------------
==>
------------------- ----------- ------------------ -------------------
------------------- ----------- ------------------ -------------------
==>
------------------- ----------- ------------------ -------------------
------------------- ----------- ------------------ -------------------
==>
------------------- ----------- ------------------ -------------------
<PAGE>
F0013 - Page 2 of 3 OFFICE OF THE MISSISSIPPI SECRETARY OF STATE
P.O. BOX 136, JACKSON, MS 39205-0136 (601) 359-1333
[Bar Code] Articles of Merger or Share Exchange
Profit Corporation
AND EITHER
a. the total number of votes cast for and against the plan by each
class entitled to vote separately on the plan was
Name of Corporation Class Total no. of votes Total no. of votes
cast FOR the Plan cast AGAINST the Plan
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OR
b. the total number of undisputed votes cast for the plan separately
by each class was
Name of Corporation Class Total no. of undisputed
votes cast FOR the Plan
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and the number of votes cast for the plan by each class was sufficient for
approval by that class.
Name of Corporation 1
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McLemore's Wholesale & Retail Stores, Inc.
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By: Signature (Please keep writing within blocks)
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/s/ W. H. Holman, Jr.
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Printed Name W. H. Holman, Jr. Title President
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F0013 - Page 3 of 3 OFFICE OF THE MISSISSIPPI SECRETARY OF STATE
P.O. BOX 136, JACKSON, MS 39205-0136 (601) 359-1333
[Bar Code] Articles of Merger or Share Exchange
Profit Corporation
Name of Corporation 2
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Southern Jitney Jungle Company
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By: Signature (Please keep writing within blocks)
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/s/ W. H. Holman, Jr.
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Printed Name W. H. Holman, Jr. Title President
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Name of Corporation 1
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By: Signature (Please keep writing within blocks)
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Printed Name Title
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NOTE
1. If shareholder approval is required, the plan must be approved by each
voting group entitled to vote on the plan by a majority of all votes
entitled to be cast by that voting group unless the Act or the articles of
incorporation provide for a greater vote, but not less than a majority of
all votes cast at a meeting.
2. The articles cannot be filed unless the corporation(s) has (have) paid all
fees and taxes (and delinquencies) imposed by law.
3. The articles must be similarly executed by each corporation that is a
party to the merger.
<PAGE>
AGREEMENT AND PLAN OF MERGER OF
McLEMORE'S WHOLESALE & RETAIL STORES, INC.,
A LOUISIANA CORPORATION, INTO
SOUTHERN JITNEY JUNGLE COMPANY,
A MISSISSIPPI CORPORATION, AS THE SURVIVOR
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and entered
into as of the 26th day of February, 1996, by and between McLEMORE'S WHOLESALE &
RETAIL STORES, INC., a Louisiana corporation ("McLemore's"), and SOUTHERN JITNEY
JUNGLE COMPANY, a Mississippi corporation ("Southern"), and being the
constituent corporations in the merger provided for herein (collectively, the
"Constituent Corporations").
W I T N E S S E T H:
WHEREAS, McLemore's is a wholly-owned subsidiary of Southern;
WHEREAS, the Board of Directors of each of the Constituent Corporations
deems it desirable and in the best interest of the corporation that McLemore's
be merged into Southern; and
WHEREAS, in order to accomplish the objective set forth above, the
Constituent Corporations desire to merge pursuant to this Agreement and
consistent with the applicable laws of the States of Mississippi and Louisiana;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties agree as follows:
ARTICLE I
THE PLAN OF MERGER
1.01 Names of Parties. The names of the corporations proposing to merge
are: McLemore's Wholesale & Retail Stores, Inc., a Louisiana corporation, and
Southern Jitney Jungle Company, a Mississippi corporation. The name of the
surviving corporation upon the merger is "Southern Jitney Jungle Company."
1.02 Terms and Conditions of Merger.
(a) Effective Time. The merger of McLemore's into Southern (the "Merger")
shall become effective at 9:00 a.m., Central Standard Time, on March 5, 1996
(the "Effective Time").
<PAGE>
(1) McLemore's shall be merged with and into Southern and Southern shall
continue its corporate existence and be the corporation surviving the Merger
(the "Surviving Corporation"). The Merger shall be pursuant to the provisions
of, and with the effect provided in, the Mississippi Business Corporation Act
and the laws of the State of Louisiana to the extent applicable thereto. At the
Effective Time, the separate corporate existence of McLemore's shall thereupon
cease, and said corporation shall be merged into Southern with the effect
provided in section 79-4-11.06 of the Mississippi Business Corporation Act and
La. R.S. 12:112(G), et seq.
(2) The Articles of Incorporation, as amended, of Southern shall be the
Articles of Incorporation of the Surviving Corporation, until amended as
provided by law.
(3) Until altered, amended or repealed as therein provided or otherwise in
accordance with law, the Bylaws of Southern that are in effect at the Effective
Time shall be the Bylaws of the Surviving Corporation.
(4) The directors of Southern shall be the directors of the Surviving
Corporation until their respective successors are duly elected and qualified
subject to the Bylaws thereof. Subject to the authority of the Board of
Directors of the Surviving Corporation, the officers of Southern shall be the
officers of the Surviving Corporation.
(5) The corporate existence of McLemore's shall be merged into and
continued in the Surviving Corporation. The established offices and facilities
of Southern immediately prior to the Merger shall become the established offices
and facilities of the Surviving Corporation. All rights, privileges, immunities,
powers and franchises of McLemore's in and to every type of property, real,
personal and mixed, and choses in action shall be transferred to and vested in
the Surviving Corporation by virtue of such Merger without any deed or other
document of transfer. At the Effective Time and thereafter, the Surviving
Corporation, without any order or other action on the part of any court or
otherwise, shall possess all rights, privileges, immunities, powers and
franchises, whether of a public or private nature, and be subject to all the
restrictions, disabilities and duties of each of the Constituent Corporations;
and all of each of the rights, privileges, immunities powers and franchises of
each of the Constituent Corporations, and all property, real, personal and
mixed, of each of the Constituent Corporations, and all debts and all other
choses in action and each and every interest, of or belonging to or due to
either of the
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<PAGE>
Constituent Corporations on whatever account, shall be vested in the
Surviving Corporation; and all property, rights, privileges, immunities,
powers, franchises and leasehold interests, and all and every other
interest shall be thereafter as effectively the property of the Surviving
Corporation as they were of the Constituent Corporations, and the title to
any real or personal property, vested by deed or otherwise in either of
the Constituent Corporations, shall not revert or be in any way impaired
by reason of the Merger; provided, however, that all rights of creditors
and all liens upon any property of any of the Constituent Corporations
shall be preserved unimpaired, limited in lien to the property affected by
such liens immediately prior to the Effective Time, all debts, liabilities
and duties of McLemore's shall thence forth attach to the Surviving
Corporation and may be enforced against the Surviving Corporation to the
extent as if such debts, liabilities or duties had been incurred or
contracted by the Surviving Corporation; and any claim existing or action
or proceeding pending by or against McLemore's may be prosecuted as if
such Merger had not taken place, or the Surviving Corporation may be
substituted in its place.
1.03 Exchange of Shares. The mode of carrying into effect the Merger and
the manner and basis of converting or exchanging the shares of each of the
Constituent Corporations into shares of the Surviving Corporation shall be as
follows:
(a) Constituent Corporation Common Stock. Upon the Effective Time of the
Merger, each issued share of Common Stock of McLemore's at such Effective Time
shall be surrendered and canceled as of the Effective Time, and no shares of
Common Stock of the Surviving Corporation shall be issued in exchange for all of
the issued and outstanding Common Stock of McLemore's.
(b) Surviving Corporation Common Stock. None of the shares of Common Stock
of the Surviving Corporation issued and outstanding at the Effective Time shall
be converted as a result of the Merger, but all of such shares shall remain
issued and outstanding shares of Common Stock of the Surviving Corporation.
1.04 Additional Terms.
(a) Waiver of Mailing Requirement. Southern, being the sole shareholder of
McLemore's, hereby waives the statutory requirements under La. R.S. 12: 112
(C)(1) of the Louisiana Business Corporation Act that a copy or summary of this
Agreement be mailed to each shareholder of McLemore's expressly for the purpose
of permitting McLemore's and Southern to deliver the Certificate of Merger to
the Secretary of State of Louisiana and Articles of Merger to the Secretary of
State of Mississippi for filing prior to thirty (30)
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<PAGE>
days after the date of mailing a copy of the Agreement to each shareholder of
McLemore's who does not waive the mailing requirement, as permitted by La.
R.S. 12:73 (D) of the Louisiana Business Corporation Act.
(b) Termination. This Agreement may be terminated at any time prior to the
Effective Time as provided in Article II of this Agreement.
ARTICLE II
TERMINATION OF AGREEMENT AND
ABANDONMENT OF MERGER
Anything herein to the contrary notwithstanding, this Agreement, and the
Merger contemplated hereby, may be terminated at any time prior to the filing of
the Articles of Merger with the Secretary of State of Mississippi or the filing
of a Certificate of Merger with the Secretary of State of Louisiana by the Board
of Directors of the Surviving Corporation.
In the event of the termination or abandonment of this Agreement pursuant
to the provisions of this Article II, this Agreement shall forthwith become null
and void and have no effect, and there shall be no liability on the part of
either party hereto.
ARTICLE III
MISCELLANEOUS
3.01 Waiver. Any of the terms or conditions of this Agreement may be
waived at any time by either party hereto.
3.02 Amendment. This Agreement shall be amended, extended or canceled only
by written instrument executed by or on behalf of each of the parties hereto.
3.03. Entire Contract. This Agreement constitutes the entire contract
between the parties and supersedes all other understandings with respect to the
subject matter hereof.
3.04 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Mississippi.
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<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement and Plan of
Merger to be executed by duly authorized officers as of the 26th day of
February, 1996.
McLEMORE'S WHOLESALE & RETAIL
STORES, INC., a Louisiana
corporation
By: /s/ W. H. Holman, Jr., President
--------------------------------------
W. H. Holman, Jr., President
Attest: /s/ David R. Black
-------------------------
David R. Black,
Assistant Secretary
SOUTHERN JITNEY JUNGLE COMPANY,
a Mississippi corporation
By: /s/ W. H. Holman, Jr., President
--------------------------------------
W. H. Holman, Jr., President
Attest: /s/ David R. Black
-------------------------
David R. Black,
Assistant Secretary
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<PAGE>
FILED
MAR 05 1996
ERIC [ILLEGIBLE]
SECRETARY
OF STATE
ARTICLES OF MERGER OR SHARE EXCHANGE
PROFIT
The undersigned corporations, pursuant to Section 79-4-11.05, as amended, hereby
execute the following articles of merger and share exchange and set forth.
1. The names of the corporations are Southern Jitney Jungle Company, a
Mississippi corporation (the "Surviving Corporation") and JJ (Southern),
Inc. a Delaware corporation (the "Merging Corporation")
2. The plan of merger or share exchange. (Attached)
3. (Mark appropriate box.)
( ) (a) Shareholder approval of the plan of merger was not required.
(X) (b) If approval of the shareholders of one or more corporations party
to the merger or share exchange was required:
(i) the designation, number of outstanding shares, and number
of votes entitled to be cast by each voting group entitled to vote
separately on the plan as to each corporation were:
Number of No. of votes
Name of outstanding entitled to be
Corporation Designation shares cast
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Southern Jitney Jungle Company Common 4910 4910
JJ (Southern), Inc. Common 1000 1000
(ii) And either
against the plan by each voting group entitled to vote separately on the plan
was:
Total Number of Total Number of
Name of votes cast FOR votes cast
Corporation Voting Group the plan AGAINST the plan
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Southern Jitney Jungle Company Common 4910 0
JJ (Southern), Inc. Common 1000 0
OR
<PAGE>
3. b. the total number of undisputed votes cast for the plan separately by
each voting group was:
Total Number of
Name of Undisputed Votes Cast
Corporation Voting Group FOR the Plan
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and the number cast for the plan by each voting group was sufficient for
approval by that voting group.
Southern Jitney jungle Company
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NAME OF CORPORATION
By: W. H. Holman, Jr./President /s/ W. H. Holman
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PRINTED NAME/CORPORATE TITLE SIGNATURE
JJ (Southern), Inc.
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NAME OF CORPORATION
By: Harold 0. Rosser, II/President /s/ Harold 0. Rosser
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PRINTED NAME/CORPORATE TITLE SIGNATURE
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NAME OF CORPORATION
By: Harold 0. Rosser, II/President
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PRINTED NAME/CORPORATE TITLE SIGNATURE
NOTE
1. If shareholder approval is required, the plan must be approved by each
voting group entitled to vote on the plan by a majority of all votes
entitled to be cast by that voting group unless the Act or the articles of
incorporation provide for a greater or lesser vote, but not less than a
majority of all votes cast at a meeting.
2. The articles cannot be filed unless the corporation(s) has (have) paid all
fees and taxes (and delinquencies) imposed by law.
3. The articles must be similarly executed by each corporation that is a
party to the merger.
<PAGE>
AGREEMENT AND PLAN OF MERGER
SOUTHERN JITNEY JUNGLE COMPANY AND JJ (SOUTHERN), INC.
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement and Plan of Merger"),
dated as of March 5, 1996, is made and entered into by and between JJ
(Southern), Inc., a Delaware corporation (the "Merging Corporation"), and
Southern Jitney Jungle Company, a Mississippi corporation (the "Surviving
Corporation") (such Corporations being sometimes collectively referred to
hereinafter as the "Constituent Corporations").
WITNESSETH:
WHEREAS, the Constituent Corporations desire to effect a merger of the
Merging Corporation with and into the Surviving Corporation pursuant to
provisions of the Mississippi Business Corporation Act (the "MBCA") and the
Delaware General Corporation Law (the "DGCL");
WHEREAS, the respective Boards of Directors of the Merging Corporation and
the Surviving Corporation have determined that it is advisable and in the best
interests of each of the Constituent Corporations that the Merging Corporation
merge with and into the Surviving Corporation upon the terms and subject to the
conditions herein provided;
WHEREAS, the respective Boards of Directors of the Merging Corporation and
the Surviving Corporation have, by resolutions duly adopted, (a) approved this
Agreement and Plan of Merger and directed that it be executed by the undersigned
officers and (b) have directed that it be submitted to a vote of the
shareholders of the Merging Corporation and the shareholders of the Surviving
Corporation, respectively;
<PAGE>
WHEREAS, the shareholders of the Merging Corporation and the shareholders
of the Surviving Corporation have approved this Agreement and Plan of Merger
NOW THEREFORE, in consideration of the approval of the agreements herein
contained, the parties agree that the Merging Corporation shall be merged with
and into the Surviving Corporation, and that the terms and conditions of such
merger shall be as hereinafter set forth.
I. THE MERGER
1.1. Surviving Corporation. Subject to the terms and provisions of this
Agreement and Plan of Merger, and in accordance with the MBCA and the DGCL, at
the Effective Time (as defined in Section 1.8 hereof) the Merging Corporation
shall be merged with and into the Surviving Corporation (the "Merger"). The
Surviving Corporation shall be the surviving corporation of the Merger and shall
continue its corporate existence under the laws of the State of Mississippi. At
the Effective Time the separate corporate existence of the Merging Corporation
shall cease.
1.2. Registered Office of Surviving Corporation. The Surviving
Corporation's registered office in the State of Mississippi is located at 1770
Ellis Avenue, Suite 200, County of Hinds, Jackson, Mississippi 39204, and the
name of its registered agent in the State of Mississippi is W. H. Holman, Jr.
1.3. Effects of the Merger. At the Effective Time, the Merger shall have
the effects provided for herein and in Section 79-4-11.06 of the MBCA and
Sections 252 and 259 of the DGCL
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<PAGE>
1.4. Articles of Incorporation. As of the Effective Time, the Amended and
Restated Articles of Incorporation attached hereto as Exhibit A shall become the
Amended and Restated Articles of Incorporation of the Surviving Corporation (the
"Articles of Incorporation") until thereafter duly altered, amended or repealed
in accordance with the provisions thereof and applicable law.
1.5. By-Laws. As of the Effective Time, the By-Laws of the Surviving
Corporation as in effect immediately prior to the Effective Time shall become
the By-Laws of the Surviving Corporation (the "By-Laws") until thereafter duly
altered, amended or repealed in accordance with the provisions thereof, the
Articles of Incorporation and applicable law.
1.6. Directors of the Surviving Corporation. At the Effective Time, the
directors of JJ (Southern), Inc. immediately prior to the Merger shall become
the directors of the Surviving Corporation and each such person shall serve as a
director of the Surviving Corporation until his successor is duly elected and
qualified in the manner provided in the By-Laws or as otherwise provided by law
or until his earlier death, resignation or removal in the manner provided in the
By-Laws or as otherwise provided by law.
1.7. Officers of the Surviving Corporation. At the Effective Time, each
person who is an officer of the Surviving Corporation immediately prior to the
Effective Time shall become an officer of the Surviving Corporation with each
such person to hold the same office in the Surviving Corporation, in accordance
with the By-Laws, as he or she held in the Surviving Corporation immediately
prior to the Effective Time.
1.8. Effective Time. The Merger shall become effective upon filing (the
"Effective Time"), provided that a certificate of merger has been filed with the
Secretary
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<PAGE>
of State of the State of Delaware in accordance with Section 252 of the DGCL and
articles of merger have been filed with the Secretary of State of the State of
Mississippi in accordance with the provisions of Section 79-4-11.05 of the MBCA.
II. MANNER AND BASIS OF EXCHANGING OR CONVERTING SHARES
2.1. Capitalization of Constituent Corporations.
(a) The present capitalization of the Surviving Corporation consists
of 5,000 shares of Common Stock, par value $10.00 per share ("Surviving
Corporation Common Stock"), 4,910 shares of which are issued and outstanding.
(b) The present capitalization of the Merging Corporation consists
of 1,000,000 shares of Common Stock, par value $.01 per share ("Merging
Corporation Common Stock"), 1,000 shares of which are issued and outstanding and
1,000,000 shares of Preferred Stock, par value $.01 per share, none of which is
issued and outstanding.
2.2. Exchange or Conversion of Shares. At the Effective Time, by virtue of
the Merger and without any action on the part of the holder thereof, all of the
shares of Merging Corporation Common Stock shall be cancelled and all of the
Surviving Corporation Common Stock issued and outstanding immediately prior to
the Effective Time shall remain as fully paid and nonassessable shares of
Surviving Corporation Common Stock.
2.3. Effect of Conversion. At and after the Effective Time, each share
certificate which immediately prior to the Effective Time represented
outstanding shares of Surviving Corporation Common Stock (a "Surviving
Corporation Certificate") shall be deemed for all purposes to evidence ownership
of, and to represent, the number of
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<PAGE>
shares of Surviving Corporation Common Stock represented by such certificates
immediately prior to the Effective Time pursuant to Section 2.2 hereof. The
registered owner of any Surviving Corporation Certificate outstanding
immediately prior to the Effective Time as such owner appears in the books and
records of the Surviving Corporation immediately prior to the Effective Time,
shall, until the Surviving Corporation Certificate is surrendered for transfer
or exchange, have and be entitled to exercise any voting and other rights with
respect to and, subject to Section 2.4 hereof, to receive any dividends or other
distributions on the shares of Surviving Corporation Common Stock.
2.4. Surrender of Certificates. The holder of a Merging Corporation
Certificate shall surrender the Merging Corporation Certificate after the
Effective Time to the Surviving Corporation for cancellation.
2.5. Effect of Dissenters' Rights. All shares of stock of the Constituent
Corporations have been voted in favor of the Merger; therefore, no shareholders
are entitled to elect dissenters rights.
III. APPROVAL; AMENDMENT; TERMINATION
3.1. Approval. This Agreement and Plan of Merger has been approved by the
shareholders of the Surviving Corporation pursuant to Section 79-4-11.03 of the
MBCA and by the shareholders of the Merging Corporation pursuant to Section
251(c) of the DGCL.
3.2. Abandonment. At any time prior to the Effective Time, this Agreement
and Plan of Merger may be terminated and the Merger may be abandoned by the
Board of
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<PAGE>
Directors of either of the Constituent Corporations, or both, notwithstanding
approval of this Agreement and Plan of Merger by the shareholders of the Merging
Corporation and the shareholders of the Surviving Corporation.
3.3. Amendment. This Agreement and Plan of Merger may be amended, modified
or supplemented by written agreement of the Constituent Corporations at any time
prior to the Effective Time, except as provided in Section 251(d) of the DGCL
IV. MISCELLANEOUS
4.1. Additional Actions.
(a) Subject to Section 3.3 hereof, if either party hereto shall so
request prior to the Effective Time, the other party hereto shall from time to
time and at any reasonable time execute and deliver to the other party such
other and further documents, instruments and assurances and take such other
actions as may be reasonably necessary, appropriate or convenient in order to
carry out the purpose and intent of this Agreement and Plan of Merger and the
transactions contemplated hereby.
(b) If, at any time after the Effective Time, the Surviving
Corporation shall consider or be advised that the execution and delivery of any
further documents, instruments or assurances or the taking of any other actions
may be necessary, appropriate or convenient to (i) vest, perfect or confirm, of
record or otherwise, in the Surviving Corporation, title to and possession of
any property or right of the Merging Corporation acquired or to be acquired by
reason of, or as a result of, the Merger or (ii) otherwise carry out the purpose
and intent of this Agreement and Plan of Merger and the transactions
contemplated hereby, the Merging Corporation and its proper officers
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<PAGE>
and directors shall be deemed to have granted hereby to the Surviving
Corporation an irrevocable power of attorney to execute and deliver all such
documents, instruments and assurances and to take all actions necessary,
appropriate or convenient to vest, perfect or confirm title to and the
possession of such property or rights in the Surviving Corporation and otherwise
to carry out the purpose and intent of this Agreement and Plan of Merger and the
transactions contemplated hereby and the proper officers and directors of the
Surviving Corporation are hereby fully authorized in the name of the Merging
Corporation or otherwise to take any and all such action.
4.2. Notices. All notices and other communications required or permitted
hereunder shall be in writing and, unless otherwise provided in this Agreement
and Plan of Merger, shall be deemed to have been duly given when delivered to
the addressees at the addresses specified below:
(a) If to the Merging Corporation:
JJ (Southern), Inc.
126 East 56th Street
29th Floor
New York, NY 10022
Attention: Harold 0. Rosser II, President
(b) If to the Surviving Corporation:
Southern Jitney Jungle Company
1770 Ellis Avenue
Suite 200
Jackson, MS 39204
Attention: W.H. Holman, Jr.
or to such other address or addresses as either party may from time to time
designate as to itself by like notice.
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<PAGE>
4.3. Waiver. The Merging Corporation, on the one hand, and the Surviving
Corporation, on the other hand, by written notice to the other, may waive,
modify or extend the time for performance of any of the obligations or other
actions of the other under this Agreement and Plan of Merger; provided, however,
that neither party may without the consent of the other make or grant such
extension of time, waiver or modification of performance with respect to its own
obligations hereunder. Except as provided in the preceding sentence, no action
taken pursuant to this Agreement and Plan of Merger shall be deemed to
constitute a waiver of either party's rights hereunder and shall not operate or
be construed as a waiver of any subsequent breach, whether of a similar or
dissimilar nature.
4.4. Entire Agreement. This Agreement and Plan of Merger supersedes any
other agreement, whether written or oral, that may have been made or entered
into by the Merging Corporation or the Surviving Corporation (or by any
director, officer or representative of such parties) relating to the matters
contemplated hereby. This Agreement and Plan of Merger constitutes the entire
agreement by and between the parties on the subject hereof and there are no
agreements or commitments except as expressly set forth herein.
4.5. Limitations on Rights of the Parties. Nothing expressed or implied in
this Agreement and Plan of Merger is intended or shall be construed to confer
upon or give any person, firm or corporation other than the parties hereto and
their successors and permitted assigns any rights or remedies under or by reason
of this Agreement and Plan of Merger or any transaction contemplated hereby.
-8-
<PAGE>
4.6. Applicable Law. This Agreement and Plan of Merger and the legal
relations between the parties hereto shall be governed by and construed in
accordance with the substantive laws of the State of Mississippi, without giving
effect to the principles of conflict of laws thereof, except to the extent that
the effectiveness of the Merger may be subject to specific requirements of
Delaware law.
4.7. Execution in Counterparts. This Agreement and Plan of Merger may be
executed in one or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same agreement.
4.8. Titles and Headings. Titles and headings to articles and sections
herein are inserted for convenience of reference only, and are not intended to
be a part of or to affect the meaning or interpretation of this Agreement and
Plan of Merger.
4.9. Partial Invalidity. If any term or provision of this Agreement and
Plan of Merger or the application thereof to any party or circumstance shall, to
any extent, be held invalid and unenforceable, the remainder of this Agreement
and Plan of Merger, or the application of such term or provision to persons or
circumstances other than those as to whom or which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this Agreement and Plan of Merger shall be valid and enforceable to the fullest
extent permitted by law.
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<PAGE>
IN WITNESS WHEREOF, the Merging Corporation and the Surviving Corporation
have caused this Agreement and Plan of Merger to be executed by their respective
duly authorized officers as of the date first above written.
MERGING CORPORATION:
JJ (SOUTHERN), INC., a
Delaware corporation
By: /s/ Harold O. Rones II
----------------------------------------
Name: Harold O. Rones II
Title: President
SURVIVING CORPORATION:
SOUTHERN JITNEY JUNGLE COMPANY,
a Mississippi corporation
By: /s/ W. H. Holman, Jr.
----------------------------------------
Name: W. H. Holman, Jr.
Title: President
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<PAGE>
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
SOUTHERN JITNEY JUNGLE COMPANY
FIRST: The name of the corporation is Southern Jitney Jungle Company.
SECOND: The corporation is authorized to issue 5,000 shares of Common
Stock, par value of $10.00 per share. Shareholders shall not have the right to
cumulate their votes for directors nor shall the shareholders be entitled to
multiply the number of votes they are entitled to cast by the number of
directors for whom they are entitled to vote and cast the product for a single
candidate or distribute the product among two (2) or more candidates.
THIRD: The street address of the corporation's registered office is 453
North Mill Street, Jackson, Mississippi 39202, and the name of its registered
agent at that office is W. H. Holman, Jr.
FOURTH: A director of the corporation will not be liable to the
corporation or to its shareholders for monetary damages for any action taken, or
any failure to take action, as a director, except liability for: (i) the amount
of a financial benefit received by a director to which he is not entitled; (ii)
an intentional infliction of harm on the corporation or the shareholders; (iii)
a violation of Section 79-4-8.33 of the Mississippi Code of 1972, as amended; or
(iv) an intentional violation of criminal law. If the Mississippi Business
Corporation Act is amended to authorize corporate action further eliminating or
limiting the personal liability of directors, then the liability of a director
of the corporation shall be eliminated or limited to the fullest extent
permitted by the Mississippi Business Corporation Act, as so amended. Any repeal
or modification of this Article by the shareholders of the corporation shall not
adversely affect any right or protection of a director of the corporation
existing at the time of such repeal or modification.
FIFTH: Provisions with respect to indemnification are as follows:
(A) Definitions. In this article:
(1) "corporation" includes this corporation and any domestic or foreign
predecessor entity of the corporation in a merger or other transaction in which
the predecessor's existence ceased upon consummation of the transaction;
(2) "director" means an individual who is or was a director of the
corporation or an individual who, while a director of the corporation, is or was
serving at the corporation's request as a director, officer, partner, trustee,
employee or agent of another foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise. A director shall be
considered to be serving an employee benefit plan at the
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EXHIBIT
"A"
____
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involve services by, him to the plan or to participants in or beneficiaries of
the plan. "Director" includes, unless the context requires otherwise, the estate
or personal representative of a director;
(3) "expenses" include counsel fees;
(4) "liability" means the obligation to pay a judgment, settlement,
penalty, fine (including an excise tax assessed with respect to an employee
benefit plan), or reasonable expenses incurred with respect to a proceeding;
(5) "official capacity" means: (i) when used with respect to a director,
the office of director in the corporation; and (ii) when used with respect to an
individual other than a director as contemplated in Section (G) hereof, the
office in the corporation held by the officer or the employment or agency
relationship undertaken by the employee or agent on behalf of the corporation.
As used herein, "official capacity" does not include service for any other
foreign or domestic corporation or any partnership, joint venture, trust,
employee benefit plan or other enterprise;
(6) "party" includes an individual who was, is, or is threatened to be
made a named defendant or respondent in a proceeding;
(7) "proceeding" means any threatened, pending, or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative and
whether formal or informal;
(B) Authority to Indemnify. (a) Except as provided in subsection (d)
hereof, the corporation shall indemnify any individual made a party to a
proceeding because he is or was a director against liability incurred in the
proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed:
(i) In the case of conduct in his official capacity with the
corporation, that his conduct was in its best interests; and
(ii) In all other cases, that his conduct was at least not opposed
to its best interests; and
(3) In the case of any criminal proceeding, he had no reasonable cause to
believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for a
purpose he reasonably believed to be in the interest of the participants in and
beneficiaries of the plan is conduct that satisfies the requirement of
subsection (a)(2)(ii) of Section (B) hereof.
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(c) The termination of a proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent is not, of
itself, determinative that the director did not meet the standard of conduct
described in this section.
(d) The corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation; or
(2) In connection with any other proceeding charging improper
personal benefit to him, whether or not involving action in
his official capacity, in which he was adjudged liable on the
basis that personal benefit was improperly received by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation shall be limited to reasonable
expenses incurred in connection with the proceeding.
(C) Mandatory Indemnification. Unless otherwise limited by these articles
of incorporation, the corporation shall indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any proceeding to
which he was a party because he is or was a director of the corporation against
reasonable expenses incurred by him in connection with the proceeding.
(D) Advance for Expenses. (a) The corporation shall pay for or reimburse
the reasonable expenses incurred by a director who is a party to a proceeding in
advance of final disposition of the proceeding if:
(1) The director furnishes the corporation a written affirmation
of his good faith belief that he has met the standard of
conduct described in subsection 2 of Section (B) hereof;
(2) The director furnishes the corporation a written undertaking,
executed personally or on his behalf, to repay the advance if
it shall be ultimately determined that he did not meet the
standard of conduct; and
(3) A determination shall be made that the facts then known to
those making the determination would not preclude
indemnification under this article.
(b) The undertaking required by subsection (a) (2) of Section (D) hereof
must be an unlimited general obligation of the director but need not be secured
and may be accepted without reference to financial ability to make repayment.
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(c) Determination and authorizations of payments under this section shall
be made in the manner specified in Section (F) hereof.
(E) Court Ordered Indemnification. Unless these articles of incorporation
provide otherwise, a director of the corporation who is a party to a proceeding
may apply for indemnification to the court conducting the proceeding or to
another court of competent jurisdiction.
(F) Determination and Authorization of Indemnification. (a) The
corporation may not indemnify a director under Section (B) hereof unless
authorized in the specific case after a determination has been made that
indemnification of the director shall be permissible in the circumstances
because he has met the standard of conduct set forth in Section (B) hereof.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum
consisting of directors not at the time parties to the
proceeding;
(2) If a quorum cannot be obtained under subsection (b)(1) of
Section (F) hereof, by majority vote of a committee duly
designated by the board of directors (in which designation
directors who are parties may participate), consisting solely
of two (2) or more directors not at the time parties to the
proceeding;
(3) By special legal counsel:
(i) Selected by the board of directors or its committee in
the manner prescribed in subsection (b)(1) or (b)(2) of
Section (F) hereof; or
(ii) If a quorum of the board of directors cannot be obtained
under subsection (b)(1) of Section (F) hereof and a
committee cannot be designated under subsection (b)(2)
of Section (F) hereof, selected by a majority vote of
the full board of directors (in which selection
directors who are parties may participate); or
(4) By the shareholders, but shares owned by or voted under the
control of directors who are at the time parties to the
proceeding may not be voted on the determination.
(c) Authorization of indemnification and evaluation as to reasonableness
of expenses shall be made in the same manner as the determination that
indemnification shall be permissible, except that if the determination shall be
made by special legal counsel,
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authorization of indemnification and evaluation as to reasonableness of expenses
shall be made by those entitled under subsection (b)(3) of Section (F) hereof to
select counsel.
(d) The corporation agrees to submit requests for indemnification or
advancement of expenses to the board of directors of the corporation or to the
shareholders of the corporation, as applicable, within a reasonable time after
the director requests in writing that the corporation indemnify the director or
advance expenses to him.
(G) Indemnification of Officers, Employees and Agents. Unless otherwise
provided herein:
(1) An officer of the corporation who is not a director shall be entitled
to mandatory indemnification under Section (C) hereof, and shall be entitled to
apply for court-ordered indemnification under Section (E) hereof, in each case
to the same extent as a director;
(2) The corporation shall indemnify and advance expenses under this
article to an officer of the corporation who is not a director to the same
extent as to a director; and
(3) The corporation shall also indemnify and advance expenses to an
officer who is not a director to the extent, consistent with public policy, that
may be provided by the articles of incorporation, bylaws, general or specific
action of the board of directors or contract.
(H) Right of Corporation to Insure. The corporation may purchase and
maintain insurance on behalf of an individual who is or was a director, officer,
employee or agent of the corporation or who, while a director, officer, employee
or agent of the corporation, is or was serving at the request of the corporation
as a director, officer, partner, trustee, employee or agent of another foreign
or domestic corporation, partnership, joint venture, trust, employee benefit
plan or other enterprise, against liability asserted against or incurred by him
in that capacity or arising from his status as a director, officer, employee or
agent, whether or not the corporation would have power to indemnify him against
such liability under Sections (B) or (C) hereof or applicable law.
(I) Application of Article. (a) Unless these articles of incorporation
provide otherwise, any authorization of indemnification in the articles of
incorporation or the bylaws shall not be deemed to prevent the corporation from
providing the indemnity permitted or mandated by applicable law.
(b) The board of directors of the corporation shall have power to make any
further indemnity, including advance of expenses, to and to enter contracts of
indemnity with any director, officer, employee or agent, except an indemnity
against his gross negligence or willful misconduct. Any determination as to any
further indemnity shall be made in accordance with subsection (b) of Section (F)
hereof. Each such indemnity may
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continue as to a person who has ceased to have the capacity referred to above
and may inure to the benefit of the heirs, executors and administrators of such
person.
(c) The corporation shall pay or reimburse expenses incurred by a director
in connection with his appearance as a witness in a proceeding at a time when he
has not been made a named defendant or respondent to the proceeding when his
appearance as a witness is in connection with his serving as a director of the
corporation.
(J) Right to Bring Action to Enforce. The rights to indemnification and to
the advancement of expenses conferred under this article shall be contract
rights. If a claim under this article is not paid in full by the corporation
within 90 days after a written claim has been received by the corporation, the
director making such claim may at any time thereafter bring suit against the
corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, the director shall be entitled to be paid also the expense of
prosecuting such claim. It shall be a defense to any such action that the
director has not met the standards of conduct which make it permissible under
this article or the laws of the State of Mississippi for the corporation to
indemnify the director for the amounts claimed, but the burden of proving such
defense shall be on the corporation. Neither the failure of the corporation
(including its board of directors, independent legal counsel, or its
shareholders) to have made a determination prior to the commencement of such
action that indemnification of the director shall be proper in the circumstances
because he has met the applicable standard of conduct set forth under the laws
of the State of Mississippi or under these articles of incorporation, nor an
actual determination by the corporation (including its board of directors,
independent legal counsel, or its shareholders) that the director had not met
such applicable standard of conduct, shall be a defense to the action or create
a presumption that the director had not met the applicable standard of conduct.
Dated: March 5, 1996.
SOUTHERN JITNEY JUNGLE COMPANY
By: /s/ W. H. Holman, Jr.
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W. H. Holman, Jr., Chairman and CEO
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Exhibit 3.10
RESTATED BYLAWS
OF
SOUTHERN JITNEY JUNGLE COMPANY
ARTICLE I. PRINCIPAL OFFICE
The principal office of the corporation in the State of Mississippi shall
be located in the City of Jackson, County of Hinds. The corporation may have
such other offices, either within or without the State of Mississippi, as the
board of directors may designate or as the business of the corporation may
require from time to time.
ARTICLE II. SHAREHOLDERS
SECTION 1. Annual Meeting. The annual meeting of the shareholders shall be
held on the third Wednesday in the month of October, in each year at the hour of
10:00 o'clock, A.M., or such other time and date as may be determined by the
directors, for the purpose of electing directors and for the transaction of such
other business as may properly come before the meeting. If the day fixed for the
annual meeting shall be a legal holiday in the State of Mississippi, such
meeting shall be held on the next succeeding business day.
If the election of directors shall not be held on the day designated
herein for any annual meeting of the shareholders, or at any adjournment
thereof, the board of directors shall cause the election to be held at a special
meeting of the shareholders as soon thereafter as conveniently may be.
SECTION 2. Special Meetings. The corporation shall hold a special meeting
of shareholders (1) on call of its board of directors or the president; or (2)
unless the articles of incorporation provide otherwise, if the holders of at
least ten percent (10%) of all the votes entitled to be cast on any issue
proposed to be considered at the proposed special meeting sign, date and deliver
to the corporation's secretary one or more written demands for the meeting
describing the purpose or purposes for which it is to be held. If not otherwise
fixed under applicable law, the record date for determining shareholders
entitled to demand a special meeting shall be the date the first shareholder
signs the demand.
SECTION 3. Place of Meeting. The board of directors may designate any
place, either within or without the State of Mississippi, for any annual meeting
or for any special meeting of shareholders. A valid waiver of notice signed by
all shareholders entitled to notice may designate any place, either within or
without the State of Mississippi, as the
<PAGE>
place for any annual meeting or for any special meeting of shareholders. Unless
the notice of the meeting states otherwise, shareholders' meetings shall be held
at the corporation's principal office.
SECTION 4. Notice of Meeting. The corporation shall notify shareholders of
the date, time and place of each annual and special shareholders' meeting no
fewer than ten (10) nor more than sixty (60) days before the meeting date.
Unless applicable law or the articles of incorporation require otherwise, the
corporation shall give notice only to shareholders entitled to vote at the
meeting.
Unless applicable law or the articles of incorporation require otherwise,
notice of an annual meeting need not include a description of the purpose or
purposes for which the meeting is called. Notice of a special meeting must
include a description of the purpose or purposes for which the meeting shall be
called. Only business within the purpose or purposes described in the meeting
notice may be conducted at a special shareholders' meeting.
Unless these bylaws require otherwise, if an annual or special
shareholders' meeting is adjourned to a different date, time or place, notice
need not be given of the new date, time or place if the new date, time or place
is announced at the meeting before adjournment. If a new record date for the
adjourned meeting is or must be fixed under applicable law or Article II,
Section 5 of these bylaws, however, notice of the adjourned meeting must be
given under this section to persons who are shareholders as of the new record
date.
SECTION 5. Closing of Transfer Books or Fixing of Record Date. The board
of directors of the corporation may fix the record date for one or more voting
groups in order to determine shareholders entitled to notice of a shareholders'
meeting, to demand a special meeting, to vote or to take any other action. A
record date may not be more than seventy (70) days before the meeting or action
requiring a determination of shareholders. If not otherwise fixed by law, the
record date for determining shareholders entitled to notice of and to vote at an
annual or special shareholders' meeting shall be the day before the first notice
is delivered to shareholders. If the board of directors does not fix the record
date for determining shareholders entitled to a distribution (other than one
involving a purchase, redemption or other acquisition of the corporation's
shares), it shall be the date the board of directors authorizes the
distribution. A determination of shareholders entitled to notice of or to vote
at a shareholders' meeting shall be effective for any adjournment of the meeting
unless the board of directors fixes a new record date, which it must do if the
meeting is adjourned to a date more than one hundred twenty (120) days after the
date fixed for the original meeting.
SECTION 6. Voting Lists. After fixing a record date for a meeting, the
corporation shall prepare an alphabetical list of the names of all its
shareholders who are entitled to
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notice of a shareholders' meeting. The list must be arranged by voting group
(and within each voting group by class or series of shares) and show the address
of and number of shares held by each shareholder.
The shareholders' list must be available for inspection by any shareholder
beginning two (2) business days after notice of the meeting is given for which
the list was prepared and continuing through the meeting, at the corporation's
principal office or at a place identified in the meeting notice in the city
where the meeting will be held. A shareholder, his agent or attorney shall be
entitled on written demand to inspect and, subject to the requirements of
applicable law, to copy the list during regular business hours and at his
expense, during the period it shall be available for inspection. The corporation
shall make the shareholders' list available at the meeting, and any shareholder,
his agent or attorney shall be entitled to inspect the list at any time during
the meeting or any adjournment.
SECTION 7. Quorum. Shares entitled to vote as a separate voting group may
take action on a matter at a meeting only if a quorum of those shares exists
with respect to that matter. Unless the articles of incorporation or applicable
law impose other quorum requirements, a majority of the votes entitled to be
cast on the matter by a voting group, represented in person or by proxy, shall
constitute a quorum of that voting group for action on that matter. If less than
a majority of the outstanding shares are represented at a meeting, a majority of
the shares so represented may adjourn the meeting from time to time without
further notice except as may be required by Article II, Section 4 of these
bylaws or by applicable law. At such adjourned meeting at which a quorum shall
be present or represented, any business may be transacted which might have been
transacted at the meeting as originally noticed. Once a share is represented for
any purpose at a meeting, it shall be deemed present for quorum purposes for the
remainder of the meeting and for any adjournment of that meeting unless a new
record date is or must be set for that adjourned meeting.
SECTION 8. Proxies. A shareholder may appoint a proxy to vote or otherwise
act for him by signing an appointment form, either personally or by his
attorney-in-fact. An appointment of a proxy shall be effective when received by
the secretary or other officer or agent authorized to tabulate votes of the
corporation. An appointment shall be valid for eleven (11) months unless a
longer period is expressly provided in the appointment form. An appointment of a
proxy shall be revocable by the shareholder unless the appointment form
conspicuously states that it is irrevocable and the appointment shall be coupled
with an interest. Appointments coupled with an interest include the appointment
of (1) a pledgee; (2) a person who purchased or agreed to purchase the shares;
(3) a creditor of the corporation who extended it credit under terms requiring
the appointment; (4) an employee of the corporation whose employment contract
requires the appointment; or (5) a party to a voting agreement created under
applicable law.
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The death or incapacity of the shareholder appointing a proxy does not
affect the right of the corporation to accept the proxy's authority unless
notice of the death or incapacity shall be received by the secretary or other
officer or agent authorized to tabulate votes before the proxy exercises his
authority under the appointment. An appointment made irrevocable because it is
coupled with an interest shall be revoked when the interest with which it is
coupled is extinguished. A transferee for value of shares subject to an
irrevocable appointment may revoke the appointment if he did not know of its
existence when he acquired the shares and the existence of the irrevocable
appointment was not noted conspicuously on the certificate representing the
shares or on the information statement for shares without certificates.
Subject to applicable law and to any express limitation on the proxy's
authority appearing on the face of the appointment form, the corporation shall
be entitled to accept the proxy's vote or other action as that of the
shareholder making the appointment.
SECTION 9. Voting of Shares. Except as provided below or unless the
articles of incorporation provide otherwise, and subject to the provisions of
Section 12 of this Article II, each outstanding share, regardless of class,
shall be entitled to one (1) vote on each matter voted on at a shareholders'
meeting. If a quorum exists, action on a matter (other than the election of
directors) by a voting group shall be approved if the votes cast within the
voting group favoring the action exceed the votes cast opposing the action,
unless the articles of incorporation or applicable law require a greater number
of affirmative votes. Unless otherwise provided in the articles of
incorporation, directors shall be elected by a plurality of the votes cast by
the shares entitled to vote in the election at a meeting at which a quorum is
present.
SECTION 10. Voting of Shares by Certain Holders. Shares standing in the
name of another corporation may be voted by such officer, agent or proxy as the
bylaws of such corporation may prescribe, or, in the absence of such provision,
as the board of directors of such corporation may determine.
Absent special circumstances, shares of this corporation shall not be
entitled to vote if they are owned, directly or indirectly, by a second
corporation, domestic or foreign, and this corporation owns, directly or
indirectly, a majority of the shares of the second corporation entitled to vote
for the directors of the second corporation. This does not limit the power of
this corporation to vote any shares, including its own shares, held by it in a
fiduciary capacity.
Shares held by an administrator, executor, guardian or conservator may be
voted by him, either in person or by proxy, without a transfer of such shares
into his name. Shares standing in the name of a trustee may be voted by him,
either in person or by proxy, but no trustee shall be entitled to vote shares
held by him without a transfer of such shares into his name. Shares standing in
the name of a receiver may be voted by such
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receiver, and shares held by or under the control of a receiver may be voted by
such receiver without the transfer thereof into his name if authority so to do
be contained in an appropriate order of the court by which such receiver was
appointed.
A shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee, and
thereafter the pledgee shall be entitled to vote the shares so transferred.
SECTION 11. Informal Action by Shareholders. Action required or permitted
by applicable law to be taken at a shareholders' meeting may be taken without a
meeting if the action is taken by all the shareholders entitled to vote on the
action. The action must be evidenced by one or more written consents describing
the action taken, signed by all the shareholders entitled to vote on the action,
and delivered to the corporation for inclusion in the minutes or filing with the
corporate records. If not otherwise determined under applicable law, the record
date for determining shareholders entitled to take action without a meeting
shall be the date the first shareholder signs such consent. A consent signed
under this section has the effect of a meeting vote and may be described as such
in any document.
If applicable law requires that notice of proposed action be given to
nonvoting shareholders and the action is to be taken by unanimous consent of the
voting shareholders, the corporation must give its nonvoting shareholders
written notice of the proposed action at least ten (10) days before the action
is taken. The notice must contain or be accompanied by the same material that,
under applicable law, would have been required to be sent to nonvoting
shareholders in a notice of meeting at which the proposed action would have been
submitted to the shareholders for action.
SECTION 12. No Cumulative Voting. Shareholders shall not have the right to
cumulate their votes for directors nor shall the shareholders be entitled to
multiply the number of votes they are entitled to cast by the number of
directors for whom they are entitled to vote and cast the product for a single
candidate or distribute the product among two (2) or more candidates.
SECTION 13. Shares Held by Nominees. The corporation may establish a
procedure by which the beneficial owner of shares that are registered in the
name of a nominee shall be recognized by the corporation as the shareholder. The
extent of this recognition may be determined in the procedure. The procedure may
set forth: (1) the types of nominees to which it applies; (2) the rights or
privileges that the corporation recognizes in a beneficial owner; (3) the manner
in which the procedure shall be selected by the nominee; (4) the information
that must be provided when the procedure is selected; (5) the period for which
selection of the procedure shall be effective; and (6) other aspects of the
rights and duties created.
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SECTION 14. Corporation's Acceptance of Votes. If the name signed on a
vote, consent, waiver or proxy appointment corresponds to the name of the
shareholder, the corporation, if acting in good faith, shall be entitled to
accept the vote, consent, waiver or proxy appointment and give it effect as the
act of the shareholder.
If the name signed on a vote, consent, waiver or proxy appointment does
not correspond to the name of its shareholder, the corporation, if acting in
good faith, shall nevertheless be entitled to accept the vote, consent, waiver
or proxy appointment and give it effect as the act of the shareholder if: (1)
the shareholder is an entity and the name signed purports to be that of an
officer or agent of the entity; (2) the name signed purports to be that of an
administrator, executor, guardian or conservator representing the shareholder
and, if the corporation requests, evidence of fiduciary status acceptable to the
corporation has been presented with respect to the vote, consent, waiver or
proxy appointment; (3) the name signed purports to be that of a receiver or
trustee in bankruptcy of the shareholder and, if the corporation requests,
evidence of this status acceptable to the corporation has been presented with
respect to the vote, consent, waiver or proxy appointment; (4) the name signed
purports to be that of a pledgee, beneficial owner or attorney-in-fact of the
shareholder and, if the corporation requests, evidence acceptable to the
corporation of the signatory's authority to sign for the shareholder has been
presented with respect to the vote, consent, waiver or proxy appointment; (5)
two (2) or more persons are the shareholders as covenants or fiduciaries and the
name signed purports to be the name of at least one (1) of the co-owners and the
person signing appears to be acting on behalf of all the co-owners.
The corporation shall be entitled to reject a vote, consent, waiver or
proxy appointment if the secretary or other officer or agent authorized to
tabulate votes, acting in good faith, has reasonable basis for doubt about the
validity of the signature on it or about the signatory's authority to sign for
the shareholder.
ARTICLE Ill. BOARD OF DIRECTORS
SECTION 1. General Powers. All corporate powers shall be exercised by or
under the authority of, and the business and affairs of the corporation managed
under the direction of, its board of directors, subject to any limitation set
forth in the articles of incorporation.
SECTION 2. Number, Election, Tenure and Qualifications. The number of
directors of the corporation shall consist of no less than four and no more than
twelve members, the number thereof to be determined by the directors from time
to time. Notwithstanding the foregoing, the number of directors may be increased
to more than twelve to provide for additional directors that holders of any
series or class of preferred stock are entitled to elect pursuant to the terms
thereof, as necessary. Directors are
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elected at the first annual shareholders' meeting and at each annual meeting
thereafter unless their terms are staggered in the articles of incorporation.
The terms of the initial directors of the corporation expire at the first
shareholders' meeting at which directors shall be elected. The terms of all
other directors expire at the next annual shareholders' meeting following their
election unless their terms shall be staggered in the articles of incorporation.
A decrease in the number of directors does not shorten an incumbent director's
term. The term of a director elected to fill a vacancy expires at the next
shareholders' meeting at which directors shall be elected. Despite the
expiration of a director's term, he continues to serve until his successor shall
be elected and qualifies or until there shall be a decrease in the number of
directors. A director need not be a resident of this state or a shareholder of
the corporation.
SECTION 3. Resignation of Directors; Removal of Directors by Shareholders.
(a) A director may resign at any time by delivering written notice to the board
of directors, to its chairman or to the corporation. A resignation shall be
effective when the notice is delivered unless the notice specifies a later
effective date.
(b) The shareholders may remove one or more directors with or without
cause unless the articles of incorporation provide that directors may be removed
only for cause. If a director is elected by a voting group of shareholders, only
the shareholders of that voting group may participate in the vote to remove him.
If cumulative voting is authorized, a director may not be removed if the number
of votes sufficient to elect him under cumulative voting is voted against his
removal. If cumulative voting is not authorized, a director may be removed only
if the number of votes cast to remove him exceeds the number of votes cast not
to remove him. A director may be removed by the shareholders only at a meeting
called for the purpose of removing him and the meeting notice must state that
the purpose, or one (1) of the purposes, of the meeting shall be removal of the
director.
SECTION 4. Regular Meetings. Unless the articles of incorporation or these
bylaws provide otherwise, a regular meeting of the board of directors shall be
held without other notice than this bylaw immediately after, and at the same
place as, the annual meeting of shareholders. In addition, a regular meeting of
the board of directors shall be held at least once every fiscal quarter at such
time as may be fixed by resolution of the board of directors, provided notice of
any such quarterly meeting must be preceded by at least three (3) business days
notice of the date, time and place of the meeting.
SECTION 5. Special Meetings. Special meetings of the board of directors
may be called by or at the request of the chairperson of the board of directors
or any one (1) or more directors. Unless the articles of incorporation or these
bylaws provide for a longer or shorter period, special meetings of the board of
directors must be preceded by at least three (3) business days' notice of the
date, time and place of the meeting. If no place for the meeting has been
designated in the notice, the meeting shall be held at the principal
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office of the corporation. The notice need not describe the purpose of the
regular or special meeting unless required by the articles of incorporation or
these bylaws.
SECTION 6. Place of Meetings. The board of directors may hold regular or
special meetings in or out of this state.
SECTION 7. Quorum. Unless the articles of incorporation or these bylaws
require a greater number, a quorum of the board of directors consists of a
majority of the number of directors in office immediately before the meeting
begins, if the corporation has a variable-range size board. If less than such
number necessary for a quorum shall be present at a meeting, a majority of the
directors present may adjourn the meeting from time to time without further
notice.
SECTION 8. Manner of Acting. If a quorum is present when a vote is taken,
the affirmative vote of a majority of directors present is the act of the board
of directors unless the articles of incorporation or bylaws require the vote of
a greater number of directors.
SECTION 9. Action Without A Meeting. Unless the articles of incorporation
or bylaws provide otherwise, action required or permitted to be taken at a board
of directors' meeting may be taken without a meeting if the action is taken by
all members of the board. The action must be evidenced by one or more written
consents describing the action taken, signed by each director, and included in
the minutes or filed with the corporate records reflecting the action taken.
Action taken under this section shall be effective when the last director signs
the consent, unless the consent specifies a different effective date. Such a
consent has the effect of a meeting vote and may be described as such in any
document.
SECTION 10. Vacancies. Unless the articles of incorporation provide
otherwise, if a vacancy occurs on the board of directors, including a vacancy
resulting from an increase in the number of directors, (i) the shareholders may
fill the vacancy, (ii) the board of directors may fill the vacancy, or (iii) if
the directors remaining in office constitute fewer than a quorum of the board,
they may fill the vacancy by the affirmative vote of a majority of all the
directors remaining in office. If the vacant office was held by a director
elected by a voting group of shareholders, only the holders of shares of that
voting group shall be entitled to fill the vacancy if it is filled by the
shareholders. A vacancy that will occur at a specific later date (by reason of a
resignation effective at a later date or otherwise) may be filled before the
vacancy occurs, but the new director may not take office until the vacancy
occurs.
SECTION 11. Compensation. Unless the articles of incorporation or these
bylaws provide otherwise, the board of directors may fix the compensation of
directors. By resolution of the board of directors, each director may be paid
his expenses, if any, of attendance at each meeting of the board of directors,
and may be paid a stated salary as
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a director or a fixed sum for attendance at each meeting of the board of
directors or both. No such payment shall preclude any director from serving the
corporation in any other capacity and receiving compensation therefor.
SECTION 12. Executive and Other Committees. Unless the articles of
incorporation or bylaws provide otherwise, the board of directors may create an
executive committee and one or more other committees and appoint members of the
board of directors to serve on them. Each committee must have two (2) or more
members, who serve at the pleasure of the board of directors. The creation of a
committee and appointment of members to it must be approved by the greater of
(1) a majority of all the directors in office when the action is taken or (2)
the number of directors required by the articles of incorporation or bylaws to
take action. To the extent specified by the board of directors or in the
articles of incorporation or bylaws, each committee may exercise the authority
of the board of directors. A committee may not, however, authorize
distributions; approve or propose to shareholders action required by applicable
law to be approved by shareholders; fill vacancies on the board of directors or
on any of its committees; amend articles of incorporation, which pursuant to
applicable law the board of directors are authorized to amend; adopt, amend, or
repeal bylaws; approve a plan of merger not requiring shareholder approval;
authorize or approve the reacquisition of shares, except according to a formula
or method prescribed by the board of directors; or authorize or approve the
issuance or sale or contract for sale of shares, or determine the designation
and relative rights, preferences and limitations of a class or series of shares,
except that the board of directors may authorize a committee (or a senior
executive officer of the corporation) to do so within limits specifically
prescribed by the board of directors. Provisions of these bylaws governing
meetings, action without meetings, notice and waiver of notice, and quorum and
voting requirements of the board of directors, apply to committees and their
members as well.
SECTION 13. Participation by Telephonic or Other Means. Unless the
articles of incorporation or these bylaws provide otherwise, the board of
directors may permit any or all directors to participate in a regular or special
meeting by, or conduct the meeting through the use of, any means of
communication by which all directors participating may simultaneously hear each
other during the meeting. A director participating in a meeting by this means
shall be deemed to be present in person at the meeting.
ARTICLE IV. OFFICERS
SECTION 1. Number. The officers of the corporation shall be a chairman of
the board, a president, a vice president, a secretary and a treasurer, each of
whom shall be elected by the board of directors. Such other officers, assistant
officers and agents as may be deemed necessary may be elected or appointed by
the board of directors. Any two or more offices may be held by the same person.
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SECTION 2. Election and Term of Officers. The officers of the corporation
to be elected by the board of directors shall be elected annually by the board
of directors at the regular meeting of the board of directors immediately
following the annual meeting of the shareholders. If the election of officers
shall not be held at such meeting, such election shall be held as soon
thereafter as conveniently may be. Each officer shall continue to serve until
his successor is elected and qualifies or until his death or until he shall
resign or shall have been removed in the manner hereinafter provided.
SECTION 3. Resignation or Removal of Officers and Agents. (a) An officer
or agent may resign at any time by delivering written notice to the board of
directors, to its chairman or to the corporation. A resignation shall be
effective when the notice is delivered unless the notice specifies a later
effective date.
(b) Any officer or agent may be removed by the board of directors whenever
in its judgment, the best interests of the corporation will be served thereby,
but such removal shall be without prejudice to the contract rights, if any, of
the person so removed. Election or appointment of an officer or agent shall not
of itself create contract rights.
SECTION 4. Vacancies. A vacancy in any office because of death,
resignation, removal, disqualification or otherwise, may be filled by the board
of directors for the unexpired portion of the term.
SECTION 5. Chairman of the Board. The chairman of the board shall be the
chief executive officer of the corporation and must be a member of the board of
directors at the time of election to such office. When present he shall preside
at all meetings of the shareholders and of the board of directors. He may sign,
with the president and secretary or any other proper officer of the corporation
thereunto authorized by the board of directors, any deeds, mortgages, bonds,
contracts or other instruments which the board of directors has authorized to be
executed, except in cases where the signing and execution thereof shall be
expressly delegated by the board of directors or by these bylaws to some other
officer or agent of the corporation, or shall be required by law to be otherwise
signed or executed; and in general shall perform all duties incident to the
office of chairman of the board and such other duties as may be prescribed by
the board of directors from time to time.
SECTION 6. President. The president shall be the chief operating officer
of the corporation and, subject to the control of the chairman and the board of
directors, shall have general supervision and control of the business and
affairs of the corporation. In the absence of the chairman of the board of
directors, he shall, when present, preside at all meetings of the shareholders
and of the board of directors. He may sign, with the secretary or any other
proper officer of the corporation thereunto authorized by the board of
directors, certificates for shares of the corporation, any deeds, mortgages,
bonds, contracts, or other instruments which the board of directors has
authorized to be executed, except in cases where the signing and execution
thereof shall be expressly delegated by
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the board of directors or by these bylaws to some other officer or agent of the
corporation, or shall be required by law to be otherwise signed or executed; and
in general shall perform all duties incident to the office of president and such
other duties as may be prescribed by the board of directors from time to time.
SECTION 7. Vice President. In the absence of the president or in the event
of his death, inability or refusal to act, the vice president shall perform the
duties of the president, and when so acting, shall have all the powers of and be
subject to all the restrictions upon the president. The vice president shall
perform such other duties as from time to time may be assigned to him by the
president or by the board of directors.
SECTION 8. Secretary. The secretary shall (a) prepare and keep the minutes
of the directors' and shareholders' meetings in one or more books provided for
that purpose; (b) see that all notices are duly given in accordance with the
provisions of these bylaws or as required by law; (c) be custodian of the
corporate records and of the seal of the corporation and see that the seal of
the corporation is affixed to all documents the execution of which on behalf of
the corporation under its seal is duly authorized; (d) authenticate records of
the corporation; (e) keep a register of the post office address of each
shareholder which shall be furnished to the secretary by such shareholder; (f)
sign with the president, certificates for shares of the corporation, the
issuance of which shall have been authorized by resolutions of the board of
directors; (g) have general charge of the stock transfer books of the
corporation; (h) in general perform all duties incident to the office of
secretary and such other duties as from time to time may be assigned to him by
the president or by the board of directors.
SECTION 9. Treasurer. The treasurer shall: (a) have charge and custody of
and be responsible for all funds and securities of the corporation; (b) receive
and give receipts for monies due and payable to the corporation from any source
whatsoever, and deposit all such monies in the name of the corporation in such
banks, trust companies or other depositories as shall be selected in accordance
with these bylaws; and (c) in general perform all of the duties incident to the
office of treasurer and such other duties as from time to time may be assigned
to him by the president or by the board of directors. If required by the board
of directors, the treasurer shall give a bond for the faithful discharge of his
duties in such sum and with such surety or sureties as the board of directors
shall determine.
SECTION 10. Compensation. The board of directors may fix the compensation
of the officers. No such payment shall preclude any officer from serving the
corporation in any other capacity and receiving compensation therefor.
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ARTICLE V. CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1. Contracts. The board of directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute and deliver any
instrument in the name of and on behalf of the corporation, and such authority
may be general or confined to specific instances.
SECTION 2. Loans. No loans shall be contracted on behalf of the
corporation and no evidences of indebtedness shall be issued in its name unless
authorized by a resolution of the board of directors. Such authority may be
general or confined to specific instances.
SECTION 3. Checks, Drafts, Etc. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation, shall be signed by such officer or officers, agent or agents of
the corporation and in such manner as shall from time to time be determined by
resolution of the board of directors.
SECTION 4. Deposits. All funds of the corporation not otherwise employed
shall be deposited from time to time to the credit of the corporation in such
banks, companies or other depositories as the board of directors may select.
ARTICLE VI. CERTIFICATES FOR SHARES AND THEIR TRANSFER
SECTION 1. Certificates for Shares. Shares shall be represented by
certificates. Certificates representing shares of the corporation shall be in
such form as shall be determined by the board of directors. At a minimum, each
share certificate must state on its face (1) the name of the corporation and
that the corporation is organized under the law of the State of Mississippi; (2)
the name of the person to whom issued; and (3) the number and class of shares
and the designation of the series, if any, the certificate represents. If the
corporation is authorized to issue different classes of shares or different
series within a class, the designations, relative rights, preferences and
limitations applicable to each class and the variations in rights, preferences
and limitations determined for each series (and the authority of the board of
directors to determine variations for future series) must be summarized on the
front or back of each certificate or the corporation must furnish the
shareholder this information on request in writing and without charge.
Each share certificate must be signed (either manually or in facsimile) by
the president or a vice president and by the secretary or an assistant secretary
or by such other officers designated in the bylaws or by the board of directors
so to do, and may be sealed with the corporate seal. If the person who signed
(either manually or in facsimile) a share certificate no longer holds office
when the certificate is issued, the certificate is nevertheless valid.
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All certificates for shares shall be consecutively numbered or otherwise
identified. The name and address of the person to whom the shares represented
thereby are issued, with the number of shares and date of issue, shall be
entered on the stock transfer books of the corporation. All certificates
surrendered to the corporation for transfer shall be cancelled and no new
certificate shall be issued until the former certificate for a like number of
shares shall have been surrendered and cancelled, except that in the case of a
lost, destroyed, or mutilated certificate a new one may be issued therefor upon
such terms and indemnity to the corporation as the board of directors may
prescribe.
SECTION 2. Transfer of Shares. Transfer of shares of the corporation shall
be made only on the stock transfer books of the corporation by the holder of
record thereof or by his legal representative, who shall furnish proper evidence
of authority to transfer, or by his attorney thereunto authorized by power of
attorney duly executed and filed with the secretary of the corporation, and on
surrender for cancellation of the certificate for such shares.
ARTICLE VII. INDEMNIFICATION
SECTION 1. Definitions. In this article:
(1) "Corporation" includes this corporation and any domestic or foreign
predecessor entity of the corporation in a merger or other transaction in which
the predecessor's existence ceased upon consummation of the transaction.
(2) "Director" means an individual who is or was a director of the
corporation or an individual who, while a director of the corporation, is or was
serving at the corporation's request as a director, officer, partner, trustee,
employee or agent of another foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise. A director shall be
considered to be serving an employee benefit plan at the corporation's request
if his duties to the corporation also impose duties on, or otherwise involve
services by, him to the plan or to participants in or beneficiaries of the plan.
"Director" includes, unless the context requires otherwise, the estate or
personal representative of a director.
(3) "Expenses" include counsel fees.
(4) "Liability" means the obligation to pay a judgment, settlement,
penalty, fine (including an excise tax assessed with respect to an employee
benefit plan), or reasonable expenses incurred with respect to a proceeding.
(5) "Official capacity" means: (i) when used with respect to a director,
the office of director in the corporation; and (ii) when used with respect to an
individual other than a director as contemplated in Article VII, Section 7, the
office in the corporation held by the officer or the employment or agency
relationship undertaken by the employee or agent on
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behalf of the corporation. "Official capacity" does not include service for any
other foreign or domestic corporation or any partnership, joint venture, trust,
employee benefit plan or other enterprise.
(6) "Party" includes an individual who was, is, or is threatened to be
made a named defendant or respondent in a proceeding.
(7) "Proceeding" means any threatened, pending, or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative and
whether formal or informal.
SECTION 2. Authority to Indemnify. (a) Except as provided in subsection
(d), the corporation shall indemnify any individual made a party to a proceeding
because he is or was a director against liability incurred in the proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed:
(i) In the case of conduct in his official capacity with the
corporation, that his conduct was in its best interests; and
(ii) In all other cases, that his conduct was at least not opposed
to its best interests; and
(3) In the case of any criminal proceeding, he had no reasonable cause to
believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for a
purpose he reasonably believed to be in the interest of the participants in and
beneficiaries of the plan is conduct that satisfies the requirement of
subsection (a)(2)(ii).
(c) The termination of a proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent is not, of
itself, determinative that the director did not meet the standard of conduct
described in this section.
(d) The corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation; or
(2) In connection with any other proceeding charging improper
personal benefit to him, whether or not involving action in
his official capacity,
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in which he was adjudged liable on the basis that personal
benefit was improperly received by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation shall be limited to reasonable
expenses incurred in connection with the proceeding.
SECTION 3. Mandatory Indemnification. Unless limited by the articles of
incorporation, the corporation shall indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any proceeding to
which he was a party because he is or was a director of the corporation against
reasonable expenses incurred by him in connection with the proceeding.
SECTION 4. Advance for Expenses. (a) The corporation shall pay for or
reimburse the reasonable expenses incurred by a director who is a party to a
proceeding in advance of final disposition of the proceeding if:
(1) The director furnishes the corporation a written affirmation
of his good faith belief that he has met the standard of
conduct described in Article VII, Section 2;
(2) The director furnishes the corporation a written undertaking,
executed personally or on his behalf, to repay the advance if
it shall be ultimately determined that he did not meet the
standard of conduct; and
(3) A determination shall be made that the facts then known to
those making the determination would not preclude
indemnification under this Article.
(b) The undertaking required by subsection (a) (2) must be an unlimited
general obligation of the director but need not be secured and may be accepted
without reference to financial ability to make repayment.
(c) Determination and authorizations of payments under this section shall
be made in the manner specified in Article VII, Section 6.
SECTION 5. Court Ordered Indemnification. Unless the corporation's
articles of incorporation provide otherwise, a director of the corporation who
is a party to a proceeding may apply for indemnification to the court conducting
the proceeding or to another court of competent jurisdiction.
SECTION 6. Determination and Authorization of Indemnification. (a) The
corporation may not indemnify a director under Article VII, Section 2 unless
authorized in
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the specific case after a determination has been made that indemnification of
the director shall be permissible in the circumstances because he has met the
standard of conduct set forth in Article VII, Section 2.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum
consisting of directors not at the time parties to the
proceeding;
(2) If a quorum cannot be obtained under subsection (b)(1), by
majority vote of a committee duly designated by the board of
directors (in which designation directors who are parties may
participate), consisting solely of two (2) or more directors
not at the time parties to the proceeding;
(3) By special legal counsel:
(i) Selected by the board of directors or its committee in
the manner prescribed in subsection (b)(1) or (b)(2); or
(ii) If a quorum of the board of directors cannot be obtained
under subsection (b)(1) and a committee cannot be
designated under subsection (b)(2), selected by a
majority vote of the full board of directors (in which
selection directors who are parties may participate); or
(4) By the shareholders, but shares owned by or voted under the
control of directors who are at the time parties to the
proceeding may not be voted on the determination.
(c) Authorization of indemnification and evaluation as to reasonableness
of expenses shall be made in the same manner as the determination that
indemnification shall be permissible, except that if the determination shall be
made by special legal counsel, authorization of indemnification and evaluation
as to reasonableness of expenses shall be made by those entitled under
subsection (b)(3) to select counsel.
(d) The corporation agrees to submit requests for indemnification or
advancement of expenses to the board of directors of the corporation or to the
shareholders of the corporation, as applicable, within a reasonable time after
the director requests in writing that the corporation indemnify the director or
advance expenses to him.
SECTION 7. Indemnification of Officers, Employees and Agents. Unless the
corporation's articles of incorporation provide otherwise:
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(1) An officer of the corporation who is not a director shall be entitled
to mandatory indemnification under Article VII, Section 3, and shall be entitled
to apply for court-ordered indemnification under Article VII, Section 5, in each
case to the same extent as a director;
(2) The corporation shall indemnify and advance expenses under this
article to an officer, employee or agent of the corporation who is not a
director to the same extent as to a director; and
(3) The corporation shall also indemnify and advance expenses to an
officer, employee or agent who is not a director to the extent, consistent with
public policy, that may be provided by the articles of incorporation, bylaws,
general or specific action of the board of directors or contract.
SECTION 8. Right of Corporation to Insure. The corporation may purchase
and maintain insurance on behalf of an individual who is or was a director,
officer, employee or agent of the corporation or who, while a director, officer,
employee or agent of the corporation, is or was serving at the request of the
corporation as a director, officer, partner, trustee, employee or agent of
another foreign or domestic corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, against liability asserted against or
incurred by him in that capacity or arising from his status as a director,
officer, employee or agent, whether or not the corporation would have power to
indemnify him against such liability under Article VII, Sections 2 or 3 or
applicable law.
SECTION 9. Application of Article. (a) Unless the articles of
incorporation or these bylaws provide otherwise, any authorization of
indemnification in the articles of incorporation or these bylaws shall not be
deemed to prevent the corporation from providing the indemnity permitted or
mandated by applicable law.
(b) The board of directors of the corporation shall have power to make any
further indemnity, including advance of expenses, to and to enter contracts of
indemnity with any director, officer, employee or agent, except an indemnity
against his gross negligence or willful misconduct. Any determination as to any
further indemnity shall be made in accordance with subsection (b) of Article
VII, Section 6. Each such indemnity may continue as to a person who has ceased
to have the capacity referred to above and may inure to the benefit of the
heirs, executors and administrators of such person.
(c) The corporation shall pay or reimburse expenses incurred by a director
in connection with his appearance as a witness in a proceeding at a time when he
has not been made a named defendant or respondent to the proceeding when his
appearance as a witness is in connection with his serving as a director of the
corporation.
SECTION 10. Right to Bring Action to Enforce. The rights to
indemnification and to the advancement of expenses conferred under this article
shall be contract rights. If a
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claim under this article is not paid in full by the corporation within 90 days
after a written claim has been received by the corporation, the director making
such claim may at any time thereafter bring suit against the corporation to
recover the unpaid amount of the claim and, if successful in whole or in part,
the director shall be entitled to be paid also the expense of prosecuting such
claim. It shall be a defense to any such action that the director has not met
the standards of conduct which make it permissible under this article or the
laws of the State of Mississippi for the corporation to indemnify the director
for the amounts claimed, but the burden of proving such defense shall be on the
corporation. Neither the failure of the corporation (including its board of
directors, independent legal counsel, or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the director shall be proper in the circumstances because he has met the
applicable standard of conduct set forth under the laws of the State of
Mississippi or under this Agreement, nor an actual determination by the
corporation (including its board of directors, independent legal counsel, or its
shareholders) that the director had not met such applicable standard of conduct,
shall be a defense to the action or create a presumption that the director had
not met the applicable standard of conduct.
ARTICLE VIII. NOTICE
Notice shall be in writing unless oral notice is reasonable under the
circumstances. Notice may be communicated in person; by telephone, telegraph,
teletype or other form of wire or wireless communication; or by mail or private
carrier. If these forms of personal notice shall be impracticable, notice may be
communicated by a newspaper of general circulation in the area where published;
or by radio, television or other form of public broadcast communication.
Written notice to shareholders, if in a comprehensible form, shall be
effective when mailed, if mailed postpaid and correctly addressed to the
shareholder's address shown in the corporation's current record of shareholders.
Except as provided above with respect to notice to shareholders, written
notice, if in a comprehensible form, shall be effective at the earliest of the
following:
(1) When received;
(2) Five (5) days after its deposit in the United States mail, as
evidenced by the postmark, if mailed postpaid and correctly addressed;
(3) On the date shown on the return receipt, if sent by registered or
certified mail, return receipt requested, and the receipt is signed by or on
behalf of the addressee.
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Oral notice shall be effective when communicated if communicated in a
comprehensible manner.
If applicable law prescribes notice requirements for particular
circumstances, those requirements govern. If the articles of incorporation or
these bylaws prescribe notice requirements, not inconsistent with this section
or other provisions of applicable law, those requirements govern.
ARTICLE IX. WAIVER OF NOTICE; ASSENT TO ACTIONS
Unless otherwise provided by law, a shareholder or director of the
corporation may waive any notice required by applicable law, the articles of
incorporation or these bylaws, before or after the date and time stated in the
notice. Except as provided below, the waiver must be in writing, be signed by
the shareholder or director entitled to the notice, and delivered to the
corporation for inclusion in the minutes or filing with the corporate records.
A director's attendance at or participation in a meeting waives any
required notice to him of the meeting unless the director at the beginning of
the meeting (or promptly upon his arrival) objects to holding the meeting or
transacting business at the meeting and does not thereafter vote for or assent
to action taken at the meeting. A shareholder's attendance at a meeting (i)
waives objection to lack of notice or defective notice of the meeting unless the
shareholder at the beginning of the meeting objects to holding the meeting or
transacting business at the meeting, and (ii) waives objection to consideration
of a particular matter at the meeting that is not within the purpose or purposes
described in the meeting notice, unless the shareholder objects to considering
the matter when it is presented.
A director who is present at a meeting of the board of directors or a
committee of the board of directors when corporate action is taken shall be
deemed to have assented to the action taken unless: (1) he objects at the
beginning of the meeting (or promptly upon his arrival) to holding it or
transacting business at the meeting; (2) his dissent or abstention from the
action taken shall be entered in the minutes of the meeting; or (3) he delivers
written notice of his dissent or abstention to the presiding officer of the
meeting before its adjournment or to the corporation immediately after
adjournment of the meeting. The right of dissent or abstention shall not be
available to a director who votes in favor of the action taken.
ARTICLE X. EMERGENCY BYLAWS
The emergency bylaws provided in this article shall be operative during
any emergency in the conduct of the business of the corporation, notwithstanding
any different
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provision in the preceding articles of the bylaws or in the articles of
incorporation of the corporation or in the Mississippi Business Corporation Act.
An emergency exists if a quorum of the corporation's directors cannot readily be
assembled because of some catastrophic event. To the extent not inconsistent
with the provisions of this article, the bylaws provided in the preceding
articles shall remain in effect during such emergency and upon its termination
the emergency bylaws shall cease to be operative.
During any such emergency:
(a) A meeting of the board of directors may be called by any officer or
director of the corporation. Notice of the meeting shall be given by the officer
or director calling the meeting only to those directors whom it is practicable
to reach and may be given in any practicable manner, including by publication
and radio.
(b) One or more officers of the corporation present at a meeting of the
board of directors may be deemed to be directors for the meeting, in order of
rank and within the same rank in order of seniority, as necessary to achieve a
quorum.
(c) The board of directors, either in anticipation of or during any such
emergency, may modify lines of succession to accommodate the incapacity of any
director, officer, employee or agent.
(d) The board of directors, either in anticipation of or during any such
emergency, may relocate the principal offices or regional offices, or authorize
the officers to do so.
Corporate action taken in good faith during an emergency under this
section to further the ordinary business affairs of the corporation binds the
corporation and may not be used to impose liability on a corporate director,
officer, employee or agent.
These emergency bylaws shall be subject to repeal or change by further
action of the board of directors or by action of the shareholders, but no such
repeal or change shall modify the provisions of the next preceding paragraph
with regard to action taken prior to the time of such repeal or change. Any
amendment of these emergency bylaws may make any further or different provision
that may be practical and necessary for the circumstances of the emergency.
ARTICLE XI. DISTRIBUTIONS
The board of directors may authorize and the corporation may make
distributions to its shareholders, subject to restriction by the articles of
incorporation and applicable law.
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ARTICLE XII. CORPORATE SEAL
The board of directors shall provide a corporate seal which shall be
circular in form and shall have inscribed thereon the name of the corporation
and the state of incorporation and the words "Corporate Seal".
ARTICLE XIII. AMENDMENTS
Unless the articles of incorporation, applicable law or a resolution of
the shareholders reserves this power exclusively to the shareholders in whole or
part, the corporation's board of directors may amend or repeal these bylaws and
adopt new bylaws at any regular or special meeting of the board of directors.
ACCEPTED THIS ____ day of _______, 1996.
By:
---------------------------------
TITLE:
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Exhibit 3.11
STATE OF MISSISSIPPI
[SEAL]
SECRETARY OF STATE
DICK MOLPUS
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* * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
Mississippi Corporation Information System
Corporation Name
PUMP AND SAVE, INC.
Corp ID: 0566481
Filed: 09/26/1989 AT 8:00 A. M.
/s/ Dick Molpus
Dick Molpus
Secretary of State
Filing Fee Receipt: $50.00
Secretary of State
P.O. Box 136
Jackson, Ms 39205
(601) 359-1350
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
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401 MISSISSIPPI STREET - P.O. BOX - 135 JACKSON, MS 39205
TELEPHONE (601) 359-1350
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ARTICLES OF INCORPORATION
(Attach conformed copy)
|X| PROFIT |_| NONPROFIT
(Mark Appropriate Box)
The undersigned persons, pursuant to Section [ILLEGIBLE] (if a profit
corporation) or Section [ILLEGIBLE] (if a nonprofit corporation) of the
Mississippi Code of 1972, hereby execute the following document and set forth
1. The name of the corporation is
Pump And Save, Inc.
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2. Domicile address is 453 North Mill Street
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STREET
Jackson, Mississippi, Hinds 39202
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CITY/STATE/COUNTY/ZIP
3. The period of duration is Perpetual (NONPROFIT ONLY may be perpetual).
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4. (a) The number (and classes, if any) of shares the corporation is authorized
to issue is (are) as follows (THIS IS FOR PROFIT ONLY):
Class(es) No. of Shares Authorized
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Common 500
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4. (b) If more than one (1) class of shares is authorized, the preferences,
limitations, and relative rights of each class are as follows:
5. The street address of its initial registered office is
453 North Mill Street
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STREET
Jackson, Mississippi, Hinds 39202
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CITY/STATE/COUNTY/ZIP
and the name of its initial registered agent at such address is
W. H. Holman, Jr.
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6. The name and complete address of each incorporator is as follows (PLEASE TYPE
OR PRINT)
J. Cal Mayo, Jr., 1700 Deposit Guaranty Plaza, Jackson, Mississippi 39201
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[ILLEGIBLE]
7. Other provisions See attached for other provisions
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/s/ J. Cal Mayo, Jr.
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INCORPORATORS (SIGNATURES)
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The Directors of the Corporation shall be:
W. H. Holman, Jr.
W. H. Holman, III
Marie H. Swayze
Charles H. Holman, Jr.
Judson H. Kroeze
W. B. McCarty, Jr.
Betty M. Edwards
Roger P. Friou
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[Letterhead of Butler, Snow, O'Mara, Stevens & Cannada]
September 25, 1989 [ILLEGIBLE]
HAND DELIVERY
Secretary of State
Corporations Division
6th Floor, Magnolia Federal Bank Building
Jackson, Mississippi 39201
Re: Pump and Save, Inc.
Dear Sir:
Enclosed herewith please find the duly executed Articles of Incorporation
of Pump and Save, Inc., in duplicate, along with our firm check in the amount of
$50.00 in payment of your filing fee. Please review these Articles and, if they
meet with your approval, file them of record in your office and issue the
Certificate of Incorporation.
Please hold the Certificate of Incorporation for the undersigned to be
picked up by our messenger. If you have any questions or if you need any
additional information with respect to this matter, please do not hesitate to
contact us.
Very truly yours,
BUTLER, SNOW, O'MARA, STEVENS & CANNADA
/s/ J. Cal Mayo, Jr.
J. Cal Mayo, Jr.
JCMjr:sw
Enclosure
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EXHIBIT "A"
to
ARTICLES OF AMENDMENT
PUMP AND SAVE, INC.
8. A director of the corporation shall not be liable to the corporation
or its shareholders for money damages for an action taken, or any
failure to take any action, as a director, except as liability for:
(i) the amount of a financial benefit received by a director to
which he is not entitled; (ii) an intentional infliction of harm on
the corporation or the shareholders; (iii) a violation Miss. Code
Ann. ss. 79-4-8.33 (1972), as amended, or (iv) an intentional
violation of criminal law. No amendment or repeal of this article
shall apply to or have any effect on the liability or alleged
liability of any other director of the corporation for or concerning
any action by a director occurring prior to such amendment or
repeal.
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272534
ARTICLES OF AMENDMENT
PROFIT
The undersigned corporation, pursuant to Section 79-4-10.06 of the
Mississippi Code of 1972, hereby executes the following document and sets forth:
1. The name of the corporation is Pump and Save, Inc.
2. The text of each amendment adopted is attached as Exhibit "A".
3. The amendments were adopted October 16, 1991.
4. (a) The designation, number of outstanding shares, number of votes
entitled to be cast by each voting group entitled to vote separately on
the amendment, and the number of votes of each voting group indisputably
represented at the meeting was:
No. of Votes No. of Votes
Designation No. Outstanding Entitled to be Indisputably
of Shares Shares Cost Representated
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Common stock 250 250 250
(b) the total number of votes cast for and against the amendment by each
voting group entitled to vote separately on the amendment was:
Total No. of TotaL No. of Votes
Voting Group Votes Cast FOR Cast AGAINST
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Common Stock 250 -0-
DATED: November 29, 1991.
PUMP AND SAVE, INC.
BY: /s/ Roger P. Friou
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Roger P. Friou
Vice Chairman of the Board, Chief
Financial Officer and Secretary
[ILLEGIBLE] 8:00 A.M.
Amount Received:
$50.00
Filed: 12/21/91
/s/ [ILLEGIBLE]
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Secretary of State
State of Mississippi
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FILED
Mar 05 1996
ERIC CLARK
SECRETARY
OF STATE
ARTICLES OF MERGER OR SHARE EXCHANGE
PROFIT
The undersigned corporations, pursuant to Section 79-4-11.05, as amended, hereby
execute the following articles of merger a share exchange and set forth:
1. The names of the corporations are Pump and Save, Inc., a Mississippi
corporation (the "Surviving Corporation") and JJ (Pump and Save), Inc., a
Delaware corporation (the "Merging Corporation")
2. The plan of merger or share exchange. (Attached)
3. (Mark appropriate box.)
( ) (a) Shareholder approval of the plan of merger was not required.
(X) (b) If approval of the shareholders of one or more corporations party
to the merger or share exchange was required.
(i) the designation, number of outstanding shares, and number
of votes entitled to be cast by each voting group entitled to
vote separately on the plan as to each corporation were:
Number of No. of votes
Name of outstanding entitled to be
Corporation Designation shares cast
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Pump and Save, Inc. Common 250 250
JJ (Pump and Save), Inc. Common 1000 1000
(ii) And either
against the plan by each voting group entitled to vote separately on the plan
was:
Total Number of Total Number of
Name of votes cast FOR votes cast AGAINST
Corporation Voting Group the plan the plan
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Pump and Save, Inc. Common 250 0
JJ (Pump and Save), Inc. Common 1000 0
OR
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3. b. the total number of undisputed votes cast for the plan separately by
each voting group was:
Total Number of
Name of Undisputed Votes Cast
Corporation Voting Group FOR the Plan
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and the number cast for the plan by each voting group was sufficient for
approval by that voting group.
Pump and Save, Inc.
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NAME OF CORPORATION
By: W.H. Holman, Jr./Chairman & CEO /s/ W.H. Holman, Jr.
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PRINTED NAME/CORPORATE TITLE SIGNATURE
JJ (Pump and Save), Inc.
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CORPORATION
By: Harold O. Rosser, II/President /s/ Harold O. Rosser
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PRINTED NAME/CORPORATE TITLE SIGNATURE
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NAME OF CORPORATION
By:
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PRINTED NAME/CORPORATE TITLE SIGNATURE
NOTE
1. If shareholder approval is required, the plan must be approved by each
voting group entitled to vote on the plan by a majority of all votes
entitled to be cast by that voting group unless the Act or the articles of
incorporation provide for a greater or lesser vote, but not less than a
majority of all votes cast at a meeting.
2. The articles cannot be filed unless the corporation(s) has (have) paid all
fees and taxes (and delinquencies) imposed law.
3. The articles must be similarly executed by each corporation that is a
party to the merger.
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AGREEMENT AND PLAN OF MERGER
PUMP AND SAVE, INC. AND JJ (PUMP AND SAVE), INC.
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement and Plan of Merger"),
dated as of March 5, 1996, is made and entered into by and between JJ (Pump And
Save), Inc., a Delaware corporation (the "Merging Corporation"), and Pump And
Save, Inc., a Mississippi corporation (the "Surviving Corporation") (such
Corporations being sometimes collectively referred to hereinafter as the
"Constituent Corporations").
WITNESSETH:
WHEREAS, the Constituent Corporations desire to effect a merger of the
Merging Corporation with and into the Surviving Corporation pursuant to
provisions of the Mississippi Business Corporation Act (the "MBCA") and the
Delaware General Corporation Law (the "DGCL");
WHEREAS, the respective Boards of Directors of the Merging Corporation and
the Surviving Corporation have determined that it is advisable and in the best
interests of each of the Constituent Corporations that the Merging Corporation
merge with and into the Surviving Corporation upon the terms and subject to the
conditions herein provided;
WHEREAS, the respective Boards of Directors of the Merging Corporation and
the Surviving Corporation have, by resolutions duly adopted, (a) approved this
Agreement and Plan of Merger and directed that it be executed by the undersigned
officers and (b) have directed that it be submitted to a vote of the
shareholders of the Merging Corporation and the shareholders of the Surviving
Corporation, respectively;
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WHEREAS, the shareholders of the Merging Corporation and the shareholders
of the Surviving Corporation have approved this Agreement and Plan of Merger;
NOW THEREFORE, in consideration of the approval of the agreements herein
contained, the parties agree that the Merging Corporation shall be merged with
and into the Surviving Corporation, and that the terms and conditions of such
merger shall be as hereinafter set forth.
I. THE MERGER
1.1. Surviving Corporation. Subject to the terms and provisions of this
Agreement and Plan of Merger, and in accordance with the MBCA and the DGCL, at
the Effective Time (as defined in Section 1.8 hereof) the Merging Corporation
shall be merged with and into the Surviving Corporation (the "Merger"). The
Surviving Corporation shall be the surviving corporation of the Merger and shall
continue its corporate existence under the laws of the State of Mississippi. At
the Effective Time the separate corporate existence of the Merging Corporation
shall cease.
1.2. Registered Office of Surviving Corporation. The Surviving
Corporation's registered office in the State of Mississippi is located at 1770
Ellis Avenue, Suite 200, County of Hinds, Jackson, Mississippi 39204, and the
name of its registered agent in the State of Mississippi is W.H. Holman, Jr.
1.3. Effects of the Merger. At the Effective Time, the Merger shall have
the effects provided for herein and in Section 79-4-11.06 of the MBCA and
Sections 252 and 259 of the DGCL.
1.4. Articles of Incorporation. As of the Effective Time, the Amended and
Restated Articles of Incorporation attached hereto as Exhibit A shall become the
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Amended and Restated Articles of Incorporation of the Surviving Corporation (the
"Articles of Incorporation") until thereafter duly altered, amended or repealed
in accordance with the provisions thereof and applicable law.
1.5. By-Laws. As of the Effective Time, the By-Laws of the Surviving
Corporation as in effect immediately prior to the Effective Time shall become
the By-Laws of the Surviving Corporation (the "By-Laws") until thereafter duly
altered, amended or repealed in accordance with the provisions thereof, the
Articles of Incorporation and applicable law.
1.6. Directors of the Surviving Corporation. At the Effective Time, the
directors of JJ (Pump And Save), Inc. immediately prior to the Merger shall
become the directors of the Surviving Corporation and each such person shall
serve as a director of the Surviving Corporation until his successor is duly
elected and qualified in the manner provided in the By-Laws or as otherwise
provided by law or until his earlier death, resignation or removal in the manner
provided in the By-Laws or as otherwise provided by law.
1.7. Officers of the Surviving Corporation. At the Effective Time, each
person who is an officer of the Surviving Corporation immediately prior to the
Effective Time shall become an officer of the Surviving Corporation with each
such person to hold the same office in the Surviving Corporation, in accordance
with the By-Laws, as he or she held in the Surviving Corporation immediately
prior to the Effective Time.
1.8. Effective Time. The Merger shall become effective upon filing (the
"Effective Time"), provided that a certificate of merger has been filed with the
Secretary of State of the State of Delaware in accordance with Section 252 of
the DGCL and
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articles of merger have been filed with the Secretary of State of the State of
Mississippi in accordance with the provisions of Section 79-4-11.05 of the MBCA.
II. MANNER AND BASIS OF EXCHANGING OR CONVERTING SHARES
2.1. Capitalization of Constituent Corporations.
(a) The present capitalization of the Surviving Corporation consists
of 500 shares of Common Stock, par value $100.00 per share ("Surviving
Corporation Common Stock"), 250 shares of which are issued and outstanding.
(b) The present capitalization of the Merging Corporation consists
of 1,000,000 shares of Common Stock, par value $.0l per share ("Merging
Corporation Common Stock"), 1,000 shares of which are issued and outstanding and
1,000,000 shares of Preferred Stock, par value $.01 per share, none of which is
issued and outstanding.
2.2. Exchange or Conversion of Shares. At the Effective Time, by virtue of
the Merger and without any action on the part of the holder thereof, all of the
shares of Merging Corporation Common Stock shall be cancelled and all of the
Surviving Corporation Common Stock issued and outstanding immediately prior to
the Effective Time shall remain as fully paid and nonassessable shares of
Surviving Corporation Common Stock.
2.3. Effect of Conversion. At and after the Effective Time, each share
certificate which immediately prior to the Effective Time represented
outstanding shares of Surviving Corporation Common Stock (a "Surviving
Corporation Certificate") shall be deemed for all purposes to evidence ownership
of, and to represent, the number of shares of Surviving Corporation Common Stock
represented by such certificates immediately prior to the Effective Time
pursuant to Section 2.2 hereof. The registered
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owner of any Surviving Corporation Certificate outstanding immediately prior to
the Effective Time as such owner appears in the books and records of the
Surviving Corporation immediately prior to the Effective Time, shall, until the
Surviving Corporation Certificate is surrendered for transfer or exchange, have
and be entitled to exercise any voting and other rights and, subject to Section
2.4 hereof, to receive any dividends or other distributions on the shares of
Surviving Corporation Common Stock.
2.4. Surrender of Certificates.
The holder of a Merging Corporation Certificate shall surrender the
Merging Corporation Certificate after the Effective Time to the Surviving
Corporation for cancellation.
2.5. Effect of Dissenters' Rights. All shares of stock of the Constituent
Corporations have been voted in favor of the Merger; therefore, no shareholders
are entitled to elect dissenters rights.
III. APPROVAL; AMENDMENT; TERMINATION
3.1. Approval. This Agreement and Plan of Merger has been approved by the
shareholders of the Surviving Corporation pursuant to Section 79-4-11.03 of the
MBCA and by the shareholders of the Merging Corporation pursuant to Section
251(c) of the DGCL
3.2. Abandonment. At any time prior to the Effective Time, this Agreement
and Plan of Merger may be terminated and the Merger may be abandoned by the
Board of Directors of either of the Constituent Corporations, or both,
notwithstanding approval of this Agreement and Plan of Merger by the
shareholders of the Merging Corporation and the shareholders of the Surviving
Corporation.
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3.3. Amendment. This Agreement and Plan of Merger may be amended, modified
or supplemented by written agreement of the Constituent Corporations at any time
prior to the Effective Time, except as provided in Section 25 1(d) of the DGCL.
IV. MISCELLANEOUS
4.1. Additional Actions.
(a) Subject to Section 3.3 hereof, if either party hereto shall so
request prior to the Effective Time, the other party hereto shall from time to
time and at any reasonable time execute and deliver to the other party such
other and further documents, instruments and assurances and take such other
actions as may be reasonably necessary, appropriate or convenient in order to
carry out the purpose and intent of this Agreement and Plan of Merger and the
transactions contemplated hereby.
(b) If, at any time after the Effective Time, the Surviving
Corporation shall consider or be advised that the execution and delivery of any
further documents, instruments or assurances or the taking of any other actions
may be necessary, appropriate or convenient to (i) vest, perfect or confirm, of
record or otherwise, in the Surviving Corporation, title to and possession of
any property or right of the Merging Corporation acquired or to be acquired by
reason of, or as a result of, the Merger or (ii) otherwise carry out the purpose
and intent of this Agreement and Plan of Merger and the transactions
contemplated hereby, the Merging Corporation and its proper officers and
directors shall be deemed to have granted hereby to the Surviving Corporation an
irrevocable power of attorney to execute and deliver all such documents,
instruments and assurances and to take all actions necessary, appropriate or
convenient to vest, perfect or confirm title to and the possession of such
property or rights in the Surviving Corporation
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and otherwise to carry out the purpose and intent of this Agreement and Plan of
Merger and the transactions contemplated hereby and the proper officers and
directors of the Surviving Corporation are hereby fully authorized in the name
of the Merging Corporation or otherwise to take any and all such action.
4.2. Notices. All notices and other communications required or permitted
hereunder shall be in writing and, unless otherwise provided in this Agreement
and Plan of Merger, shall be deemed to have been duly given when delivered to
the addressees at the addresses specified below:
(a) If to the Merging Corporation:
JJ (Pump And Save), Inc.
126 East 56th Street
29th Floor
New York, NY 10022
Attention: Harold O. Rosser II, President
(b) If to the Surviving Corporation:
Pump And Save, Inc.
1770 Ellis Avenue
Suite 200
Jackson, MS 39204
Attention: W.H. Holman, Jr.
or to such other address or addresses as either party may from time to time
designate as to itself by like notice.
4.3. Waiver. The Merging Corporation, on the one hand, and the Surviving
Corporation, on the other hand, by written notice to the other, may waive,
modify or extend the time for performance of any of the obligations or other
actions of the other under this Agreement and Plan of Merger; provided, however,
that neither party may without the consent of the other make or grant such
extension of time, waiver or modification of performance with respect to its own
obligations hereunder. Except as
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provided in the preceding sentence, no action taken pursuant to this Agreement
and Plan of Merger shall be deemed to constitute a waiver of either party's
rights hereunder and shall not operate or be construed as a waiver of any
subsequent breach, whether of a similar or dissimilar nature.
4.4. Entire Agreement. This Agreement and Plan of Merger supersedes any
other agreement, whether written or oral, that may have been made or entered
into by the Merging Corporation or the Surviving Corporation (or by any
director, officer or representative of such parties) relating to the matters
contemplated hereby. This Agreement and Plan of Merger constitutes the entire
agreement by and between the parties on the subject hereof and there are no
agreements or commitments except as expressly set forth herein.
4.5. Limitations on Rights of the Parties. Nothing expressed or implied in
this Agreement and Plan of Merger is intended or shall be construed to confer
upon or give any person, firm or corporation other than the parties hereto and
their successors and permitted assigns any rights or remedies under or by reason
of this Agreement and Plan of Merger or any transaction contemplated hereby.
4.6. Applicable Law. This Agreement and Plan of Merger and the legal
relations between the parties hereto shall be governed by and construed in
accordance with the substantive laws of the State of Mississippi, without giving
effect to the principles of conflict of laws thereof, except to the extent that
the effectiveness of the Merger may be subject to specific requirements of
Delaware law.
4.7. Execution in Counterparts. This Agreement and Plan of Merger may be
executed in one or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same agreement.
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4.8. Titles and Headings. Titles and headings to articles and sections
herein are inserted for convenience of reference only, and are not intended to
be a part of or to affect the meaning or interpretation of this Agreement and
Plan of Merger.
4.9. Partial Invalidity. If any term or provision of this Agreement and
Plan of Merger or the application thereof to any party or circumstance shall, to
any extent, be held invalid and unenforceable, the remainder of this Agreement
and Plan of Merger, or the application of such term or provision to persons or
circumstances other than those as to whom or which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this Agreement and Plan of Merger shall be valid and enforceable to the fullest
extent permitted by law.
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IN WITNESS WHEREOF, the Merging Corporation and the Surviving Corporation
have caused this Agreement and Plan of Merger to be executed by their respective
duly authorized officers as of the date first above written.
MERGING CORPORATION:
JJ (PUMP AND SAVE), INC., a
Delaware Corporation
By: /s/ Harold O. Rosser
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Name: Harold O. Rosser II
Title: President
SURVIVING CORPORATION:
PUMP AND SAVE, INC., a
Mississippi corporation
By: /s/ W.H. Holman, Jr.
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Name: W.H. Holman, Jr.
Title: Chairman & CEO
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AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
PUMP AND SAVE, INC.
FIRST: The name of the Corporation is Pump and Save, Inc.
SECOND: The corporation is authorized to issue 500 shares of Common Stock,
without par value. Shareholders shall not have the right to cumulate their votes
for directors nor shall the shareholders be entitled to multiply the number of
votes they are entitled to cast by the number of directors for whom they are
entitled to vote and cast the product for a single candidate or distribute the
product among two (2) or more candidates.
THIRD: The street address of the corporation's registered office is 453
North Mill Street, Jackson, Mississippi 39202, and the name of its registered
agent at that office is W.H. Holman, Jr.
FOURTH: A director of the corporation will not be liable to the
corporation or to its shareholders for monetary damages for any action taken, or
any failure to take action, as a director, except liability for (i) the amount
of a financial benefit received by a director to which he is not entitled; (ii)
an intentional infliction of harm on the corporation or the shareholders; (iii)
a violation of Section 79-4-8.33 of the Mississippi Code of 1972, as amended; or
(iv) an intentional violation of criminal law. If the Mississippi Business
Corporation Act is amended to authorize corporate action further eliminating or
limiting the personal liability of directors, then the liability of a director
of the corporation shall be eliminated or limited to the fullest extent
permitted by the Mississippi Business Corporation Act, as so amended. Any repeal
or modification of this Article by the shareholders of the corporation shall not
adversely affect any right or protection of a director of the corporation
existing at the time of such repeal or modification.
FIFTH: Provisions with respect to indemnification are as follows:
(A) Definitions. In this article:
(1) "corporation" includes this corporation and any domestic or foreign
predecessor entity of the corporation in a merger or other transaction in which
the predecessor's existence ceased upon consummation of the transaction;
(2) "director" means an individual who is or was a director of the
corporation or an individual who, while a director of the corporation, is or was
serving at the corporation's request as a director, officer, partner, trustee,
employee or agent of another foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise. A director shall be
considered to be serving an employee benefit plan at the corporation's request
if his duties to the corporation also impose duties on, or otherwise
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involve services by, him to the plan or to participants in or beneficiaries of
the plan. "Director" includes, unless the context requires otherwise, the estate
or personal representative of a director;
(3) "expenses" include counsel fees;
(4) "liability" means the obligation to pay a judgment, settlement,
penalty, fine (including an excise tax assessed with respect to an employee
benefit plan), or reasonable expenses incurred with respect to a proceeding;
(5) "official capacity" means: (i) when used with respect to a director,
the office of director in the corporation; and (ii) when used with respect to an
individual other than a director as Contemplated in Section (G) hereof, the
office in the corporation held by the officer or the employment or agency
relationship undertaken by the employee or agent on behalf of the corporation.
As used herein, "official capacity" does not include service for any other
foreign or domestic corporation or any partnership, joint venture, trust,
employee benefit plan or other enterprise;
(6) "party" includes an individual who was, is, or is threatened to be
made a named defendant or respondent in a proceeding;
(7) "proceeding" means any threatened, pending, or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative and
whether formal or informal;
(B) Authority to Indemnify. (a) Except as provided in subsection (d)
hereof, the corporation shall indemnify any individual made a party to a
proceeding because he is or was a director against liability incurred in the
proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed:
(i) In the case of conduct in his official capacity with the
corporation, that his conduct was in its best interests; and
(ii) In all other cases, that his conduct was at least not opposed
to its best interests; and
(3) In the case of any criminal proceeding, he had no reasonable cause to
believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for a
purpose he reasonably believed to be in the interest of the participants in and
beneficiaries of the plan is conduct that satisfies the requirement of
subsection (a)(2)(ii) of Section (B) hereof.
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(c) The termination of a proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent is not, of
itself, determinative that the director did not meet the standard of conduct
described in this section.
(d) The corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation; or
(2) In connection with any other proceeding charging improper
personal benefit to him, whether or not involving action in
his official capacity, in which he was adjudged liable on the
basis that personal benefit was improperly received by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation shall be limited to reasonable
expenses incurred in connection with the proceeding.
(C) Mandatory Indemnification. Unless otherwise limited by these articles
of incorporation, the corporation shall indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any proceeding to
which he was a party because he is or was a director of the corporation against
reasonable expenses incurred by him in connection with the proceeding.
(D) Advance for Expenses. (a) The corporation shall pay for or reimburse
the reasonable expenses incurred by a director who is a party to a proceeding in
advance of final disposition of the proceeding if:
(1) The director furnishes the corporation a written affirmation
of his good faith belief that he has met the standard of
conduct described in subsection 2 of Section (B) hereof;
(2) The director furnishes the corporation a written undertaking,
executed personally or on his behalf, to repay the advance if
it shall be ultimately determined that he did not meet the
standard of conduct; and
(3) A determination shall be made that the facts then known to
those making the determination would not preclude
indemnification under this article.
(b) The undertaking required by subsection (a) (2) of Section (D) hereof
must be an unlimited general obligation of the director but need not be secured
and may be accepted without reference to financial ability to make repayment.
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(c) Determination and authorizations of payments under this section shall
be made in the manner specified in Section (F) hereof.
(E) Court Ordered Indemnification. Unless these articles of incorporation
provide otherwise, a director of the corporation who is a party to a proceeding
may apply for indemnification to the court conducting the proceeding or to
another court of competent jurisdiction.
(F) Determination and Authorization of Indemnification. (a) The
corporation may not indemnify a director under Section (B) hereof unless
authorized in the specific case after a determination has been made that
indemnification of the director shall be permissible in the circumstances
because he has met the standard of Conduct set forth in Section (B) hereof.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum
consisting of directors not at the time parties to the
proceeding;
(2) If a quorum cannot be obtained under subsection (b)(1) of
Section (F) hereof, by majority vote of a committee duly
designated by the board of directors (in which designation
directors who are parties may participate), consisting solely
of two (2) or more directors not at the time parties to the
proceeding;
(3) By special legal counsel:
(i) Selected by the board of directors or its committee in
the manner prescribed in subsection (b)(1) or (b)(2) of
Section (F) hereof; or
(ii) If a quorum of the board of directors cannot be obtained
under subsection (b)(1) of Section (F) hereof and a
committee cannot be designated under subsection (b)(2)
of Section (F) hereof, selected by a majority vote of
the full board of directors (in which selection
directors who are parties may participate); or
(4) By the shareholders, but shares owned by or voted under the
control of directors who are at the time parties to the
proceeding may not be voted on the determination.
(c) Authorization of indemnification and evaluation as to reasonableness
of expenses shall be made in the same manner as the determination that
indemnification shall be permissible, except that if the determination shall be
made by special legal counsel,
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authorization of indemnification and evaluation as to reasonableness of expenses
shall be made by those entitled under subsection (b)(3) of Section (F) hereof to
select counsel.
(d) The corporation agrees to submit requests for indemnification or
advancement of expenses to the board of directors of the corporation or to the
shareholders of the corporation, as applicable, within a reasonable time after
the director requests in writing that the corporation indemnify the director or
advance expenses to him.
(G) Indemnification of Officers, Employees and Agents. Unless otherwise
provided herein:
(1) An officer of the corporation who is not a director shall be entitled
to mandatory indemnification under Section (C) hereof, and shall be entitled to
apply for court-ordered indemnification under Section (E) hereof, in each case
to the same extent as a director;
(2) The corporation shall indemnify and advance expenses under this
article to an officer of the corporation who is not a director to the same
extent as to a director; and
(3) The corporation shall also indemnify and advance expenses to an
officer who is not a director to the extent, consistent with public policy, that
may be provided by the articles of incorporation, bylaws, general or specific
action of the board of directors or contract.
(H) Right of Corporation to Insure. The corporation may purchase and
maintain insurance on behalf of an individual who is or was a director, officer,
employee or agent of the corporation or who, while a director, officer, employee
or agent of the corporation, is or was serving at the request of the corporation
as a director, officer, partner, trustee, employee or agent of another foreign
or domestic corporation, partnership, joint venture, trust, employee benefit
plan or other enterprise, against liability asserted against or incurred by him
in that capacity or arising from his status as a director, officer, employee or
agent, whether or not the corporation would have power to indemnify him against
such liability under Sections (B) or (C) hereof or applicable law.
(I) Application of Article. (a) Unless these articles of incorporation
provide otherwise, any authorization of indemnification in the articles of
incorporation or the bylaws shall not be deemed to prevent the corporation from
providing the indemnity permitted or mandated by applicable law.
(b) The board of directors of the corporation shall have power to make any
further indemnity, including advance of expenses, to and to enter contracts of
indemnity with any director, officer, employee or agent, except an indemnity
against his gross negligence or willful misconduct. Any determination as to any
further indemnity shall be made in accordance with subsection (b) of Section (F)
hereof. Each such indemnity may
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continue as to a person who has ceased to have the capacity referred to above
and may inure to the benefit of the heirs, executors and administrators of such
person.
(c) The corporation shall pay or reimburse expenses incurred by a director
in connection with his appearance as a witness in a proceeding at a time when he
has not been made a named defendant or respondent to the proceeding when his
appearance as a witness is in connection with his serving as a director of the
corporation.
(J) Right to Bring Action to Enforce. The rights to indemnification and to
the advancement of expenses conferred under this article shall be contract
rights. If a claim under this article is not paid in full by the corporation
within 90 days after a written claim has been received by the corporation, the
director making such claim may at any time thereafter bring suit against the
corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, the director shall be entitled to be paid also the expense of
prosecuting such claim. It shall be a defense to any such action that the
director has not met the standards of conduct which make it permissible under
this article or the laws of the State of Mississippi for the corporation to
indemnify the director for the amounts claimed, but the burden of proving such
defense shall be on the corporation. Neither the failure of the corporation
(including its board of directors, independent legal counsel, or its
shareholders) to have made a determination prior to the commencement of such
action that indemnification of the director shall be proper in the circumstances
because he has met the applicable standard of conduct set forth under the laws
of the State of Mississippi or under these articles of incorporation, nor an
actual determination by the corporation (including its board of directors,
independent legal counsel, or its shareholders) that the director had not met
such applicable standard of conduct, shall be a defense to the action or create
a presumption that the director had not met the applicable standard of conduct.
Dated: March 5, 1996.
Pump and Save, Inc.
By: /s/ W.H. Holman, Jr.
----------------------------------
W.H. Holman, Jr., Chairman and CEO
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Exhibit 3.12
RESTATED BYLAWS
OF
PUMP AND SAVE, INC.
ARTICLE I. PRINCIPAL OFFICE
The principal office of the corporation in the State of Mississippi shall
be located in the City of Jackson, County of Hinds. The corporation may have
such other offices, either within or without the State of Mississippi, as the
board of directors may designate or as the business of the corporation may
require from time to time.
ARTICLE II. SHAREHOLDERS
SECTION 1. Annual Meeting. The annual meeting of the shareholders shall be
held on the third Wednesday in the month of October, in each year at the hour of
10:00 o'clock, A.M., or such other time and date as may be determined by the
directors, for the purpose of electing directors and for the transaction of such
other business as may properly come before the meeting. If the day fixed for the
annual meeting shall be a legal holiday in the State of Mississippi, such
meeting shall be held on the next succeeding business day.
If the election of directors shall not be held on the day designated
herein for any annual meeting of the shareholders, or at any adjournment
thereof, the board of directors shall cause the election to be held at a special
meeting of the shareholders as soon thereafter as conveniently may be.
SECTION 2. Special Meetings. The corporation shall hold a special meeting
of shareholders (1) on call of its board of directors or the president; or (2)
unless the articles of incorporation provide otherwise, if the holders of at
least ten percent (10%) of all the votes entitled to be cast on any issue
proposed to be considered at the proposed special meeting sign, date and deliver
to the corporation's secretary one or more written demands for the meeting
describing the purpose or purposes for which it is to be held. If not otherwise
fixed under applicable law, the record date for determining shareholders
entitled to demand a special meeting shall be the date the first shareholder
signs the demand.
SECTION 3. Place of Meeting. The board of directors may designate any
place, either within or without the State of Mississippi, for any annual meeting
or for any special meeting of shareholders. A valid waiver of notice signed by
all shareholders entitled to notice may designate any place, either within or
without the State of Mississippi, as the
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place for any annual meeting or for any special meeting of shareholders. Unless
the notice of the meeting states otherwise, shareholders' meetings shall be held
at the corporation's principal office.
SECTION 4. Notice of Meeting. The corporation shall notify shareholders of
the date, time and place of each annual and special shareholders' meeting no
fewer than ten (10) nor more than sixty (60) days before the meeting date.
Unless applicable law or the articles of incorporation require otherwise; the
corporation shall give notice only to shareholders entitled to vote at the
meeting.
Unless applicable law or the articles of incorporation require otherwise,
notice of an annual meeting need not include a description of the purpose or
purposes for which the meeting is called. Notice of a special meeting must
include a description of the purpose or purposes for which the meeting shall be
called. Only business within the purpose or purposes described in the meeting
notice may be conducted at a special shareholders' meeting.
Unless these bylaws require otherwise, if an annual or special
shareholders' meeting is adjourned to a different date, time or place, notice
need not be given of the new date, time or place if the new date, time or place
is announced at the meeting before adjournment. If a new record date for the
adjourned meeting is or must be fixed under applicable law or Article II,
Section 5 of these bylaws, however, notice of the adjourned meeting must be
given under this section to persons who are shareholders as of the new record
date.
SECTION 5. Closing of Transfer Books or Fixing of Record Date. The board
of directors of the corporation may fix the record date for one or more voting
groups in order to determine shareholders entitled to notice of a shareholders'
meeting, to demand a special meeting, to vote or to take any other action. A
record date may not be more than seventy (70) days before the meeting or action
requiring a determination of shareholders. If not otherwise fixed by law, the
record date for determining shareholders entitled to notice of and to vote at an
annual or special shareholders' meeting shall be the day before the first notice
is delivered to shareholders. If the board of directors does not fix the record
date for determining shareholders entitled to a distribution (other than one
involving a purchase, redemption or other acquisition of the corporation's
shares), it shall be the date the board of directors authorizes the
distribution. A determination of shareholders entitled to notice of or to vote
at a shareholders' meeting shall be effective for any adjournment of the meeting
unless the board of directors fixes a new record date, which it must do if the
meeting is adjourned to a date more than one hundred twenty (120) days after the
date fixed for the original meeting.
SECTION 6. Voting Lists. After fixing a record date for a meeting, the
corporation shall prepare an alphabetical list of the names of all its
shareholders who are entitled to
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notice of a shareholders' meeting. The list must be arranged by voting group
(and within each voting group by class or series of shares) and show the address
of and number of shares held by each shareholder.
The shareholders' list must be available for inspection by any shareholder
beginning two (2) business days after notice of the meeting is given for which
the list was prepared and continuing through the meeting, at the corporation's
principal office or at a place identified in the meeting notice in the city
where the meeting will be held. A shareholder, his agent or attorney shall be
entitled on written demand to inspect and, subject to the requirements of
applicable law, to copy the list during regular business hours and at his
expense, during the period it shall be available for inspection. The corporation
shall make the shareholders' list available at the meeting, and any shareholder,
his agent or attorney shall be entitled to inspect the list at any time during
the meeting or any adjournment.
SECTION 7. Quorum. Shares entitled to vote as a separate voting group may
take action on a matter at a meeting only if a quorum of those shares exists
with respect to that matter. Unless the articles of incorporation or applicable
law impose other quorum requirements, a majority of the votes entitled to be
cast on the matter by a voting group, represented in person or by proxy, shall
constitute a quorum of that voting group for action on that matter. If less than
a majority of the outstanding shares are represented at a meeting, a majority of
the shares so represented may adjourn the meeting from time to time without
further notice except as may be required by Article II, Section 4 of these
bylaws or by applicable law. At such adjourned meeting at which a quorum shall
be present or represented, any business may be transacted which might have been
transacted at the meeting as originally noticed. Once a share is represented for
any purpose at a meeting, it shall be deemed present for quorum purposes for the
remainder of the meeting and for any adjournment of that meeting unless a new
record date is or must be set for that adjourned meeting.
SECTION 8. Proxies. A shareholder may appoint a proxy to vote or otherwise
act for him by signing an appointment form, either personally or by his
attorney-in- fact. An appointment of a proxy shall be effective when received by
the secretary or other officer or agent authorized to tabulate votes of the
corporation. An appointment shall be valid for eleven (11) months unless a
longer period is expressly provided in the appointment form. An appointment of a
proxy shall be revocable by the shareholder unless the appointment form
conspicuously states that it is irrevocable and the appointment shall be coupled
with an interest. Appointments coupled with an interest include the appointment
of (1) a pledgee; (2) a person who purchased or agreed to purchase the shares;
(3) a creditor of the corporation who extended it credit under terms requiring
the appointment; (4) an employee of the corporation whose employment contract
requires the appointment; or (5) a party to a voting agreement created under
applicable law.
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The death or incapacity of the shareholder appointing a proxy does not
affect the right of the corporation to accept the proxy's authority unless
notice of the death or incapacity shall be received by the secretary or other
officer or agent authorized to tabulate votes before the proxy exercises his
authority under the appointment. An appointment made irrevocable because it is
coupled with an interest shall be revoked when the interest with which it is
coupled is extinguished. A transferee for value of shares subject to an
irrevocable appointment may revoke the appointment if he did not know of its
existence when he acquired the shares and the existence of the irrevocable
appointment was not noted conspicuously on the certificate representing the
shares or on the information statement for shares without certificates.
Subject to applicable law and to any express limitation on the proxy's
authority appearing on the face of the appointment form, the corporation shall
be entitled to accept the proxy's vote or other action as that of the
shareholder making the appointment.
SECTION 9. Voting of Shares. Except as provided below or unless the
articles of incorporation provide otherwise, and subject to the provisions of
Section 12 of this Article II, each outstanding share, regardless of class,
shall be entitled to one (1) vote on each matter voted on at a shareholders'
meeting. If a quorum exists, action on a matter (other than the election of
directors) by a voting group shall be approved if the votes cast within the
voting group favoring the action exceed the votes cast opposing the action,
unless the articles of incorporation or applicable law require a greater number
of affirmative votes. Unless otherwise provided in the articles of
incorporation, directors shall be elected by a plurality of the votes cast by
the shares entitled to vote in the election at a meeting at which a quorum is
present.
SECTION 10. Voting of Shares by Certain Holders. Shares standing in the
name of another corporation may be voted by such officer, agent or proxy as the
bylaws of such corporation may prescribe, or, in the absence of such provision,
as the board of directors of such corporation may determine.
Absent special circumstances, shares of this corporation shall not be
entitled to vote if they are owned, directly or indirectly, by a second
corporation, domestic or foreign, and this corporation owns, directly or
indirectly, a majority of the shares of the second corporation entitled to vote
for the directors of the second corporation. This does not limit the power of
this corporation to vote any shares, including its own shares, held by it in a
fiduciary capacity.
Shares held by an administrator, executor, guardian or conservator may be
voted by him, either in person or by proxy, without a transfer of such shares
into his name. Shares standing in the name of a trustee may be voted by him,
either in person or by proxy, but no trustee shall be entitled to vote shares
held by him without a transfer of such shares into his name. Shares standing in
the name of a receiver may be voted by such
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receiver, and shares held by or under the control of a receiver may be voted by
such receiver without the transfer thereof into his name if authority so to do
be contained in an appropriate order of the court by which such receiver was
appointed.
A shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee, and
thereafter the pledgee shall be entitled to vote the shares so transferred.
SECTION 11. Informal Action by Shareholders. Action required or permitted
by applicable law to be taken at a shareholders' meeting may be taken without a
meeting if the action is taken by all the shareholders entitled to vote on the
action. The action must be evidenced by one or more written consents describing
the action taken, signed by all the shareholders entitled to vote on the action,
and delivered to the corporation for inclusion in the minutes or filing with the
corporate records. If not otherwise determined under applicable law, the record
date for determining shareholders entitled to take action without a meeting
shall be the date the first shareholder signs such consent. A consent signed
under this section has the effect of a meeting vote and may be described as such
in any document.
If applicable law requires that notice of proposed action be given to
nonvoting shareholders and the action is to be taken by unanimous consent of the
voting shareholders, the corporation must give its nonvoting shareholders
written notice of the proposed action at least ten (10) days before the action
is taken. The notice must contain or be accompanied by the same material that,
under applicable law, would have been required to be sent to nonvoting
shareholders in a notice of meeting at which the proposed action would have been
submitted to the shareholders for action.
SECTION 12. No Cumulative Voting. Shareholders shall not have the right to
cumulate their votes for directors nor shall the shareholders be entitled to
multiply the number of votes they are entitled to cast by the number of
directors for whom they are entitled to vote and cast the product for a single
candidate or distribute the product among two (2) or more candidates.
SECTION 13. Shares Held by Nominees. The corporation may establish a
procedure by which the beneficial owner of shares that are registered in the
name of a nominee shall be recognized by the corporation as the shareholder. The
extent of this recognition may be determined in the procedure. The procedure may
set forth: (1) the types of nominees to which it applies; (2) the rights or
privileges that the corporation recognizes in a beneficial owner; (3) the manner
in which the procedure shall be selected by the nominee; (4) the information
that must be provided when the procedure is selected; (5) the period for which
selection of the procedure shall be effective; and (6) other aspects of the
rights and duties created.
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SECTION 14. Corporation's Acceptance of Votes. If the name signed on a
vote, consent, waiver or proxy appointment corresponds to the name of the
shareholder, the corporation, if acting in good faith, shall be entitled to
accept the vote, consent, waiver or proxy appointment and give it effect as the
act of the shareholder.
If the name signed on a vote, consent, waiver or proxy appointment does
not correspond to the name of its shareholder, the corporation, if acting in
good faith, shall nevertheless be entitled to accept the vote, consent, waiver
or proxy appointment and give it effect as the act of the shareholder if: (1)
the shareholder is an entity and the name signed purports to be that of an
officer or agent of the entity; (2) the name signed purports to be that of an
administrator, executor, guardian or conservator representing the shareholder
and, if the corporation requests, evidence of fiduciary status acceptable to the
corporation has been presented with respect to the vote, consent, waiver or
proxy appointment; (3) the name signed purports to be that of a receiver or
trustee in bankruptcy of the shareholder and, if the corporation requests,
evidence of this status acceptable to the corporation has been presented with
respect to the vote, consent, waiver or proxy appointment; (4) the name signed
purports to be that of a pledgee, beneficial owner or attorney-in-fact of the
shareholder and, if the corporation requests, evidence acceptable to the
corporation of the signatory's authority to sign for the shareholder has been
presented with respect to the vote, consent, waiver or proxy appointment; (5)
two (2) or more persons are the shareholders as covenants or fiduciaries and the
name signed purports to be the name of at least one (1) of the co-owners and the
person signing appears to be acting on behalf of all the co-owners.
The corporation shall be entitled to reject a vote, consent, waiver or
proxy appointment if the secretary or other officer or agent authorized to
tabulate votes, acting in good faith, has reasonable basis for doubt about the
validity of the signature on it or about the signatory's authority to sign for
the shareholder.
ARTICLE III. BOARD OF DIRECTORS
SECTION 1. General Powers. All corporate powers shall be exercised by or
under the authority of, and the business and affairs of the corporation managed
under the direction of, its board of directors, subject to any limitation set
forth in the articles of incorporation.
SECTION 2. Number, Election, Tenure and Qualifications. The number of
directors of the corporation shall consist of no less than four and no more than
twelve members, the number thereof to be determined by the directors from time
to time. Notwithstanding the foregoing, the number of directors may be increased
to more than twelve to provide for additional directors that holders of any
series or class of preferred stock are entitled to elect pursuant to the terms
thereof, as necessary. Directors are
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elected at the first annual shareholders' meeting and at each annual meeting
thereafter unless their terms are staggered in the articles of incorporation.
The terms of the initial directors of the corporation expire at the first
shareholders' meeting at which directors shall be elected. The terms of all
other directors expire at the next annual shareholders' meeting following their
election unless their terms shall be staggered in the articles of incorporation.
A decrease in the number of directors does not shorten an incumbent director's
term. The term of a director elected to fill a vacancy expires at the next
shareholders' meeting at which directors shall be elected. Despite the
expiration of a director's term, he continues to serve until his successor shall
be elected and qualifies or until there shall be a decrease in the number of
directors. A director need not be a resident of this state or a shareholder of
the corporation.
SECTION 3. Resignation of Directors; Removal of Directors by Shareholders.
(a) A director may resign at any time by delivering written notice to the board
of directors, to its chairman or to the corporation. A resignation shall be
effective when the notice is delivered unless the notice specifies a later
effective date.
(b) The shareholders may remove one or more directors with or without
cause unless the articles of incorporation provide that directors may be removed
only for cause. If a director is elected by a voting group of shareholders, only
the shareholders of that voting group may participate in the vote to remove him.
If cumulative voting is authorized, a director may not be removed if the number
of votes sufficient to elect him under cumulative voting is voted against his
removal. If cumulative voting is not authorized, a director may be removed only
if the number of votes cast to remove him exceeds the number of votes cast not
to remove him. A director may be removed by the shareholders only at a meeting
called for the purpose of removing him and the meeting notice must state that
the purpose, or one (1) of the purposes, of the meeting shall be removal of the
director.
SECTION 4. Regular Meetings. Unless the articles of incorporation or these
bylaws provide otherwise, a regular meeting of the board of directors shall be
held without other notice than this bylaw immediately after, and at the same
place as, the annual meeting of shareholders. In addition, a regular meeting of
the board of directors shall be held at least once every fiscal quarter at such
time as may be fixed by resolution of the board of directors, provided notice of
any such quarterly meeting must be preceded by at least three (3) business days
notice of the date, time and place of the meeting.
SECTION 5. Special Meetings. Special meetings of the board of directors
may be called by or at the request of the chairperson of the board of directors
or any one (1) or more directors. Unless the articles of incorporation or these
bylaws provide for a longer or shorter period, special meetings of the board of
directors must be preceded by at least three (3) business days' notice of the
date, time and place of the meeting. If no place for the meeting has been
designated in the notice, the meeting shall be held at the principal
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office of the corporation. The notice need not describe the purpose of the
regular or special meeting unless required by the articles of incorporation or
these bylaws.
SECTION 6. Place of Meetings. The board of directors may hold regular or
special meetings in or out of this state.
SECTION 7. Quorum. Unless the articles of incorporation or these bylaws
require a greater number, a quorum of the board of directors consists of a
majority of the number of directors in office immediately before the meeting
begins, if the corporation has a variable-range size board. If less than such
number necessary for a quorum shall be present at a meeting, a majority of the
directors present may adjourn the meeting from time to time without further
notice.
SECTION 8. Manner of Acting. If a quorum is present when a vote is taken,
the affirmative vote of a majority of directors present is the act of the board
of directors unless the articles of incorporation or bylaws require the vote of
a greater number of directors.
SECTION 9. Action Without A Meeting. Unless the articles of incorporation
or bylaws provide otherwise, action required or permitted to be taken at a board
of directors' meeting may be taken without a meeting if the action is taken by
all members of the board. The action must be evidenced by one or more written
consents describing the action taken, signed by each director, and included in
the minutes or filed with the corporate records reflecting the action taken.
Action taken under this section shall be effective when the last director signs
the consent, unless the consent specifies a different effective date. Such a
consent has the effect of a meeting vote and may be described as such in any
document.
SECTION 10. Vacancies. Unless the articles of incorporation provide
otherwise, if a vacancy occurs on the board of directors, including a vacancy
resulting from an increase in the number of directors, (i) the shareholders may
fill the vacancy, (ii) the board of directors may fill the vacancy, or (iii) if
the directors remaining in office constitute fewer than a quorum of the board,
they may fill the vacancy by the affirmative vote of a majority of all the
directors remaining in office. If the vacant office was held by a director
elected by a voting group of shareholders, only the holders of shares of that
voting group shall be entitled to fill the vacancy if it is filled by the
shareholders. A vacancy that will occur at a specific later date (by reason of a
resignation effective at a later date or otherwise) may be filled before the
vacancy occurs, but the new director may not take office until the vacancy
occurs.
SECTION 11. Compensation. Unless the articles of incorporation or these
bylaws provide otherwise, the board of directors may fix the compensation of
directors. By resolution of the board of directors, each director may be paid
his expenses, if any, of attendance at each meeting of the board of directors,
and may be paid a stated salary as
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a director or a fixed sum for attendance at each meeting of the board of
directors or both. No such payment shall preclude any director from serving the
corporation in any other capacity and receiving compensation therefor.
SECTION 12. Executive and Other Committees. Unless the articles of
incorporation or bylaws provide otherwise, the board of directors may create an
executive committee and one or more other committees and appoint members of the
board of directors to serve on them. Each committee must have two (2) or more
members, who serve at the pleasure of the board of directors. The creation of a
committee and appointment of members to it must be approved by the greater of
(1) a majority of all the directors in office when the action is taken or (2)
the number of directors required by the articles of incorporation or bylaws to
take action. To the extent specified by the board of directors or in the
articles of incorporation or bylaws, each committee may exercise the authority
of the board of directors. A committee may not, however, authorize
distributions; approve or propose to shareholders action required by applicable
law to be approved by shareholders; fill vacancies on the board of directors or
on any of its committees; amend articles of incorporation, which pursuant to
applicable law the board of directors are authorized to amend; adopt, amend, or
repeal bylaws; approve a plan of merger not requiring shareholder approval;
authorize or approve the reacquisition of shares, except according to a formula
or method prescribed by the board of directors; or authorize or approve the
issuance or sale or contract for sale of shares, or determine the designation
and relative rights, preferences and limitations of a class or series of shares,
except that the board of directors may authorize a committee (or a senior
executive officer of the corporation) to do so within limits specifically
prescribed by the board of directors. Provisions of these bylaws governing
meetings, action without meetings, notice and waiver of notice, and quorum and
voting requirements of the board of directors, apply to committees and their
members as well.
SECTION 13. Participation by Telephonic or Other Means. Unless the
articles of incorporation or these bylaws provide otherwise, the board of
directors may permit any or all directors to participate in a regular or special
meeting by, or conduct the meeting through the use of, any means of
communication by which all directors participating may simultaneously hear each
other during the meeting. A director participating in a meeting by this means
shall be deemed to be present in person at the meeting.
ARTICLE IV. OFFICERS
SECTION 1. Number. The officers of the corporation shall be a chairman of
the board, a president, a vice president, a secretary and a treasurer, each of
whom shall be elected by the board of directors. Such other officers, assistant
officers and agents as may be deemed necessary may be elected or appointed by
the board of directors. Any two or more offices may be held by the same person.
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SECTION 2. Election and Term of Officers. The officers of the corporation
to be elected by the board of directors shall be elected annually by the board
of directors at the regular meeting of the board of directors immediately
following the annual meeting of the shareholders. If the election of officers
shall not be held at such meeting, such election shall be held as soon
thereafter as conveniently may be. Each officer shall continue to serve until
his successor is elected and qualifies or until his death or until he shall
resign or shall have been removed in the manner hereinafter provided.
SECTION 3. Resignation or Removal of Officers and Agents. (a) An officer
or agent may resign at any time by delivering written notice to the board of
directors, to its chairman or to the corporation. A resignation shall be
effective when the notice is delivered unless the notice specifies a later
effective date.
(b) Any officer or agent may be removed by the board of directors whenever
in its judgment, the best interests of the corporation will be served thereby,
but such removal shall be without prejudice to the contract rights, if any, of
the person so removed. Election or appointment of an officer or agent shall not
of itself create contract rights.
SECTION 4. Vacancies. A vacancy in any office because of death,
resignation, removal, disqualification or otherwise, may be filled by the board
of directors for the unexpired portion of the term.
SECTION 5. Chairman of the Board. The chairman of the board shall be the
chief executive officer of the corporation and must be a member of the board of
directors at the time of election to such office. When present he shall preside
at all meetings of the shareholders and of the board of directors. He may sign,
with the president and secretary or any other proper officer of the corporation
thereunto authorized by the board of directors, any deeds, mortgages, bonds,
contracts or other instruments which the board of directors has authorized to be
executed, except in cases where the signing and execution thereof shall be
expressly delegated by the board of directors or by these bylaws to some other
officer or agent of the corporation, or shall be required by law to be otherwise
signed or executed; and in general shall perform all duties incident to the
office of chairman of the board and such other duties as may be prescribed by
the board of directors from time to time.
SECTION 6. President. The president shall be the chief operating officer
of the corporation and, subject to the control of the chairman and the board of
directors, shall have general supervision and control of the business and
affairs of the corporation. In the absence of the chairman of the board of
directors, he shall, when present, preside at all meetings of the shareholders
and of the board of directors. He may sign, with the secretary or any other
proper officer of the corporation thereunto authorized by the board of
directors, certificates for shares of the corporation, any deeds, mortgages,
bonds, contracts, or other instruments which the board of directors has
authorized to be executed, except in cases where the signing and execution
thereof shall be expressly delegated by
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the board of directors or by these bylaws to some other officer or agent of the
corporation, or shall be required by law to be otherwise signed or executed; and
in general shall perform all duties incident to the office of president and such
other duties as may be prescribed by the board of directors from time to time.
SECTION 7. Vice President. In the absence of the president or in the event
of his death, inability or refusal to act, the vice president shall perform the
duties of the president, and when so acting, shall have all the powers of and be
subject to all the restrictions upon the president. The vice president shall
perform such other duties as from time to time may be assigned to him by the
president or by the board of directors.
SECTION 8. Secretary. The secretary shall (a) prepare and keep the minutes
of the directors' and shareholders' meetings in one or more books provided for
that purpose; (b) see that all notices are duly given in accordance with the
provisions of these bylaws or as required by law; (c) be custodian of the
corporate records and of the seal of the corporation and see that the seal of
the corporation is affixed to all documents the execution of which on behalf of
the corporation under its seal is duly authorized; (d) authenticate records of
the corporation; (e) keep a register of the post office address of each
shareholder which shall be furnished to the secretary by such shareholder; (f)
sign with the president, certificates for shares of the corporation, the
issuance of which shall have been authorized by resolutions of the board of
directors; (g) have general charge of the stock transfer books of the
corporation; (h) in general perform all duties incident to the office of
secretary and such other duties as from time to time may be assigned to him by
the president or by the board of directors.
SECTION 9. Treasurer. The treasurer shall: (a) have charge and custody of
and be responsible for all funds and securities of the corporation; (b) receive
and give receipts for monies due and payable to the corporation from any source
whatsoever, and deposit all such monies in the name of the corporation in such
banks, trust companies or other depositories as shall be selected in accordance
with these bylaws; and (c) in general perform all of the duties incident to the
office of treasurer and such other duties as from time to time may be assigned
to him by the president or by the board of directors. If required by the board
of directors, the treasurer shall give a bond for the faithful discharge of his
duties in such sum and with such surety or sureties as the board of directors
shall determine.
SECTION 10. Compensation. The board of directors may fix the compensation
of the officers. No such payment shall preclude any officer from serving the
corporation in any other capacity and receiving compensation therefor.
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ARTICLE V. CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1. Contracts. The board of directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute and deliver any
instrument in the name of and on behalf of the corporation, and such authority
may be general or confined to specific instances.
SECTION 2. Loans. No loans shall be contracted on behalf of the
corporation and no evidences of indebtedness shall be issued in its name unless
authorized by a resolution of the board of directors. Such authority may be
general or confined to specific instances.
SECTION 3. Checks, Drafts, Etc. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation, shall be signed by such officer or officers, agent or agents of
the corporation and in such manner as shall from time to time be determined by
resolution of the board of directors.
SECTION 4. Deposits. All funds of the corporation not otherwise employed
shall be deposited from time to time to the credit of the corporation in such
banks, companies or other depositories as the board of directors may select.
ARTICLE VI. CERTIFICATES FOR SHARES AND THEIR TRANSFER
SECTION 1. Certificates for Shares. Shares shall be represented by
certificates. Certificates representing shares of the corporation shall be in
such form as shall be determined by the board of directors. At a minimum, each
share certificate must state on its face (1) the name of the corporation and
that the corporation is organized under the law of the State of Mississippi; (2)
the name of the person to whom issued; and (3) the number and class of shares
and the designation of the series, if any, the certificate represents. If the
corporation is authorized to issue different classes of shares or different
series within a class, the designations, relative rights, preferences and
limitations applicable to each class and the variations in rights, preferences
and limitations determined for each series (and the authority of the board of
directors to determine variations for future series) must be summarized on the
front or back of each certificate or the corporation must furnish the
shareholder this information on request in writing and without charge.
Each share certificate must be signed (either manually or in facsimile) by
the president or a vice president and by the secretary or an assistant secretary
or by such other officers designated in the bylaws or by the board of directors
so to do, and may be sealed with the corporate seal. If the person who signed
(either manually or in facsimile) a share certificate no longer holds office
when the certificate is issued, the certificate is nevertheless valid.
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All certificates for shares shall be consecutively numbered or otherwise
identified. The name and address of the person to whom the shares represented
thereby are issued, with the number of shares and date of issue, shall be
entered on the stock transfer books of the corporation. All certificates
surrendered to the corporation for transfer shall be cancelled and no new
certificate shall be issued until the former certificate for a like number of
shares shall have been surrendered and cancelled, except that in the case of a
lost, destroyed, or mutilated certificate a new one may be issued therefor upon
such terms and indemnity to the corporation as the board of directors may
prescribe.
SECTION 2. Transfer of Shares. Transfer of shares of the corporation shall
be made only on the stock transfer books of the corporation by the holder of
record thereof or by his legal representative, who shall furnish proper evidence
of authority to transfer, or by his attorney thereunto authorized by power of
attorney duly executed and filed with the secretary of the corporation, and on
surrender for cancellation of the certificate for such shares.
ARTICLE VII. INDEMNIFICATION
SECTION 1. Definitions. In this article:
(1) "Corporation" includes this corporation and any domestic or foreign
predecessor entity of the corporation in a merger or other transaction in which
the predecessor's existence ceased upon consummation of the transaction.
(2) "Director" means an individual who is or was a director of the
corporation or an individual who, while a director of the corporation, is or was
serving at the corporation's request as a director, officer, partner, trustee,
employee or agent of another foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise. A director shall be
considered to be serving an employee benefit plan at the corporation's request
if his duties to the corporation also impose duties on, or otherwise involve
services by, him to the plan or to participants in or beneficiaries of the plan.
"Director" includes, unless the context requires otherwise, the estate or
personal representative of a director.
(3) "Expenses" include counsel fees.
(4) "Liability" means the obligation to pay a judgment, settlement,
penalty, fine (including an excise tax assessed with respect to an employee
benefit plan), or reasonable expenses incurred with respect to a proceeding.
(5) "Official capacity" means: (i) when used with respect to a director,
the office of director in the corporation; and (ii) when used with respect to an
individual other than a director as contemplated in Article VII, Section 7, the
office in the corporation held by the officer or the employment or agency
relationship undertaken by the employee or agent on
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behalf of the corporation. "Official capacity" does not include service for any
other foreign or domestic corporation or any partnership, joint venture, trust,
employee benefit plan or other enterprise.
(6) "Party" includes an individual who was, is, or is threatened to be
made a named defendant or respondent in a proceeding.
(7) "Proceeding" means any threatened, pending, or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative and
whether formal or informal.
SECTION 2. Authority to Indemnify. (a) Except as provided in subsection
(d), the corporation shall indemnify any individual made a party to a proceeding
because he is or was a director against liability incurred in the proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed:
(i) In the case of conduct in his official capacity with the
corporation, that his conduct was in its best interests; and
(ii) In all other cases, that his conduct was at least not opposed
to its best interests; and
(3) In the case of any criminal proceeding, he had no reasonable cause to
believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for a
purpose he reasonably believed to be in the interest of the participants in and
beneficiaries of the plan is conduct that satisfies the requirement of
subsection (a)(2)(ii).
(c) The termination of a proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent is not, of
itself, determinative that the director did not meet the standard of conduct
described in this section.
(d) The corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation; or
(2) In connection with any other proceeding charging improper
personal benefit to him, whether or not involving action in
his official capacity,
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in which he was adjudged liable on the basis that personal
benefit was improperly received by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation shall be limited to reasonable
expenses incurred in connection with the proceeding.
SECTION 3. Mandatory Indemnification. Unless limited by the articles of
incorporation, the corporation shall indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any proceeding to
which he was a party because he is or was a director of the corporation against
reasonable expenses incurred by him in connection with the proceeding.
SECTION 4. Advance for Expenses. (a) The corporation shall pay for or
reimburse the reasonable expenses incurred by a director who is a party to a
proceeding in advance of final disposition of the proceeding if:
(1) The director furnishes the corporation a written affirmation
of his good faith belief that he has met the standard of
conduct described in Article VII, Section 2;
(2) The director furnishes the corporation a written undertaking,
executed personally or on his behalf, to repay the advance if
it shall be ultimately determined that he did not meet the
standard of conduct; and
(3) A determination shall be made that the facts then known to
those making the determination would not preclude
indemnification under this Article.
(b) The undertaking required by subsection (a)(2) must be an unlimited
general obligation of the director but need not be secured and may be accepted
without reference to financial ability to make repayment.
(c) Determination and authorizations of payments under this section shall
be made in the manner specified in Article VII, Section 6.
SECTION 5. Court Ordered Indemnification. Unless the corporation's
articles of incorporation provide otherwise, a director of the corporation who
is a party to a proceeding may apply for indemnification to the court conducting
the proceeding or to another court of competent jurisdiction.
SECTION 6. Determination and Authorization of Indemnification. (a) The
corporation may not indemnify a director under Article VII, Section 2 unless
authorized in
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the specific case after a determination has been made that indemnification of
the director shall be permissible in the circumstances because he has met the
standard of conduct set forth in Article VII, Section 2.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum
consisting of directors not at the time parties to the
proceeding;
(2) If a quorum cannot be obtained under subsection (b)(1), by
majority vote of a committee duly designated by the board of
directors (in which designation directors who are parties may
participate), consisting solely of two (2) or more directors
not at the time parties to the proceeding;
(3) By special legal counsel:
(i) Selected by the board of directors or its committee in
the manner prescribed in subsection (b)(1) or (b)(2); or
(ii) If a quorum of the board of directors cannot be obtained
under subsection (b)(1) and a committee cannot be
designated under subsection (b)(2), selected by a
majority vote of the full board of directors (in which
selection directors who are parties may participate); or
(4) By the shareholders, but shares owned by or voted under the
control of directors who are at the time parties to the
proceeding may not be voted on the determination.
(c) Authorization of indemnification and evaluation as to reasonableness
of expenses shall be made in the same manner as the determination that
indemnification shall be permissible, except that if the determination shall be
made by special legal counsel, authorization of indemnification and evaluation
as to reasonableness of expenses shall be made by those entitled under
subsection b)(3) to select counsel.
(d) The corporation agrees to submit requests for indemnification or
advancement of expenses to the board of directors of the corporation or to the
shareholders of the corporation, as applicable, within a reasonable time after
the director requests in writing that the corporation indemnify the director or
advance expenses to him.
SECTION 7. Indemnification of Officers, Employees and Agents. Unless the
corporation's articles of incorporation provide otherwise:
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(1) An officer of the corporation who is not a director shall be entitled
to mandatory indemnification under Article VII, Section 3, and shall be entitled
to apply for court-ordered indemnification under Article VII, Section 5, in each
case to the same extent as a director;
(2) The corporation shall indemnify and advance expenses under this
article to an officer, employee or agent of the corporation who is not a
director to the same extent as to a director; and
(3) The corporation shall also indemnify and advance expenses to an
officer, employee or agent who is not a director to the extent, consistent with
public policy, that may be provided by the articles of incorporation, bylaws,
general or specific action of the board of directors or contract.
SECTION 8. Right of Corporation to Insure. The corporation may purchase
and maintain insurance on behalf of an individual who is or was a director,
officer, employee or agent of the corporation or who, while a director, officer,
employee or agent of the corporation, is or was serving at the request of the
corporation as a director, officer, partner, trustee, employee or agent of
another foreign or domestic corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, against liability asserted against or
incurred by him in that capacity or arising from his status as a director,
officer, employee or agent, whether or not the corporation would have power to
indemnify him against such liability under Article VII, Sections 2 or 3 or
applicable law.
SECTION 9. Application of Article. (a) Unless the articles of
incorporation or these bylaws provide otherwise, any authorization of
indemnification in the articles of incorporation or these bylaws shall not be
deemed to prevent the corporation from providing the indemnity permitted or
mandated by applicable law.
(b) The board of directors of the corporation shall have power to make any
further indemnity, including advance of expenses, to and to enter contracts of
indemnity with any director, officer, employee or agent, except an indemnity
against his gross negligence or willful misconduct. Any determination as to any
further indemnity shall be made in accordance with subsection (b) of Article
VII, Section 6. Each such indemnity may continue as to a person who has ceased
to have the capacity referred to above and may inure to the benefit of the
heirs, executors and administrators of such person.
(c) The corporation shall pay or reimburse expenses incurred by a director
in connection with his appearance as a witness in a proceeding at a time when he
has not been made a named defendant or respondent to the proceeding when his
appearance as a witness is in connection with his serving as a director of the
corporation.
SECTION 10. Right to Bring Action to Enforce. The rights to
indemnification and to the advancement of expenses conferred under this article
shall be contract rights. If a
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<PAGE>
claim under this article is not paid in full by the corporation within 90 days
after a written claim has been received by the corporation, the director making
such claim may at any time thereafter bring suit against the corporation to
recover the unpaid amount of the claim and, if successful in whole or in part,
the director shall be entitled to be paid also the expense of prosecuting such
claim. It shall be a defense to any such action that the director has not met
the standards of conduct which make it permissible under this article or the
laws of the State of Mississippi for the corporation to indemnify the director
for the amounts claimed, but the burden of proving such defense shall be on the
corporation. Neither the failure of the corporation (including its board of
directors, independent legal counsel, or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the director shall be proper in the circumstances because he has met the
applicable standard of conduct set forth under the laws of the State of
Mississippi or under this Agreement, nor an actual determination by the
corporation (including its board of directors, independent legal counsel, or its
shareholders) that the director had not met such applicable standard of conduct,
shall be a defense to the action or create a presumption that the director had
not met the applicable standard of conduct.
ARTICLE VIII. NOTICE
Notice shall be in writing unless oral notice is reasonable under the
circumstances. Notice may be communicated in person; by telephone, telegraph,
teletype or other form of wire or wireless communication; or by mail or private
carrier. If these forms of personal notice shall be impracticable, notice may be
communicated by a newspaper of general circulation in the area where published;
or by radio, television or other form of public broadcast communication.
Written notice to shareholders, if in a comprehensible form, shall be
effective when mailed, if mailed postpaid and correctly addressed to the
shareholder's address shown in the corporation's current record of shareholders.
Except as provided above with respect to notice to shareholders, written
notice, if in a comprehensible form, shall be effective at the earliest of the
following:
(1) When received;
(2) Five (5) days after its deposit in the United States mail, as
evidenced by the postmark, if mailed postpaid and correctly addressed;
(3) On the date shown on the return receipt, if sent by registered or
certified mail, return receipt requested, and the receipt is signed by or on
behalf of the addressee.
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Oral notice shall be effective when communicated if communicated in a
comprehensible manner.
If applicable law prescribes notice requirements for particular
circumstances, those requirements govern. If the articles of incorporation or
these bylaws prescribe notice requirements, not inconsistent with this section
or other provisions of applicable law, those requirements govern.
ARTICLE IX. WAIVER OF NOTICE; ASSENT TO ACTIONS
Unless otherwise provided by law, a shareholder or director of the
corporation may waive any notice required by applicable law, the articles of
incorporation or these bylaws, before or after the date and time stated in the
notice. Except as provided below, the waiver must be in writing, be signed by
the shareholder or director entitled to the notice, and delivered to the
corporation for inclusion in the minutes or filing with the corporate records.
A director's attendance at or participation in a meeting waives any
required notice to him of the meeting unless the director at the beginning of
the meeting (or promptly upon his arrival) objects to holding the meeting or
transacting business at the meeting and does not thereafter vote for or assent
to action taken at the meeting. A shareholder's attendance at a meeting (i)
waives objection to lack of notice or defective notice of the meeting unless the
shareholder at the beginning of the meeting objects to holding the meeting or
transacting business at the meeting, and (ii) waives objection to consideration
of a particular matter at the meeting that is not within the purpose or purposes
described in the meeting notice, unless the shareholder objects to considering
the matter when it is presented.
A director who is present at a meeting of the board of directors or a
committee of the board of directors when corporate action is taken shall be
deemed to have assented to the action taken unless: (1) he objects at the
beginning of the meeting (or promptly upon his arrival) to holding it or
transacting business at the meeting; (2) his dissent or abstention from the
action taken shall be entered in the minutes of the meeting; or (3) he delivers
written notice of his dissent or abstention to the presiding officer of the
meeting before its adjournment or to the corporation immediately after
adjournment of the meeting. The right of dissent or abstention shall not be
available to a director who votes in favor of the action taken.
ARTICLE X. EMERGENCY BYLAWS
The emergency bylaws provided in this article shall be operative during
any emergency in the conduct of the business of the corporation, notwithstanding
any different
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provision in the preceding articles of the bylaws or in the articles of
incorporation of the corporation or in the Mississippi Business Corporation Act.
An emergency exists if a quorum of the corporation's directors cannot readily be
assembled because of some catastrophic event. To the extent not inconsistent
with the provisions of this article, the bylaws provided in the preceding
articles shall remain in effect during such emergency and upon its termination
the emergency bylaws shall cease to be operative.
During any such emergency:
(a) A meeting of the board of directors may be called by any officer or
director of the corporation. Notice of the meeting shall be given by the officer
or director calling the meeting only to those directors whom it is practicable
to reach and may be given in any practicable manner, including by publication
and radio.
(b) One or more officers of the corporation present at a meeting of the
board of directors may be deemed to be directors for the meeting, in order of
rank and within the same rank in order of seniority, as necessary to achieve a
quorum.
(c) The board of directors, either in anticipation of or during any such
emergency, may modify lines of succession to accommodate the incapacity of any
director, officer, employee or agent.
(d) The board of directors, either in anticipation of or during any such
emergency, may relocate the principal offices or regional offices, or authorize
the officers to do so.
Corporate action taken in good faith during an emergency under this
section to further the ordinary business affairs of the corporation binds the
corporation and may not be used to impose liability on a corporate director,
officer, employee or agent.
These emergency bylaws shall be subject to repeal or change by further
action of the board of directors or by action of the shareholders, but no such
repeal or change shall modify the provisions of the next preceding paragraph
with regard to action taken prior to the time of such repeal or change. Any
amendment of these emergency bylaws may make any further or different provision
that may be practical and necessary for the circumstances of the emergency.
ARTICLE XI. DISTRIBUTIONS
The board of directors may authorize and the corporation may make
distributions to its shareholders, subject to restriction by the articles of
incorporation and applicable law.
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ARTICLE XII. CORPORATE SEAL
The board of directors shall provide a corporate seal which shall be
circular in form and shall have inscribed thereon the name of the corporation
and the state of incorporation and the words "Corporate Seal".
ARTICLE XIII. AMENDMENTS
Unless the articles of incorporation, applicable law or a resolution of
the shareholders reserves this power exclusively to the shareholders in whole or
part, the corporation's board of directors may amend or repeal these bylaws and
adopt new bylaws at any regular or special meeting of the board of directors.
ACCEPTED THIS ____ day of _______________, 1996.
By: _________________________________
TITLE:
21
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Exhibit 3.13
================================================================================
UNITED STATES OF AMERICA
- --------------------------------------------------------------------------------
State of Louisiana
- --------------------------------------------------------------------------------
Fox McKeithen
SECRETARY OF STATE
As Secretary of State, of the State of Louisiana, I do hereby Certify that the
annexed and following is a True and Correct copy of the Articles of
Incorporation, Initial Report and 1997 Annual Report of
SUPERMARKET CIGARETTE SALES, INC.
A LOUISIANA corporation domiciled at HAMMOND,
As shown by comparison with documents filed and recorded in this Office.
In testimony whereof, I have hereunto set
my hand and caused the Seal of my Office
to be affixed at the City of Baton Rouge on,
September 5, 1997
/s/Fox McKeithen [SEAL SECRETARY OF STATE]
CAS
Secretary of State
================================================================================
<PAGE>
ARTICLES OF INCORPORATION
OF
SUPERMARKET CIGARETTE SALES, INC.
The undersigned, acting pursuant to the Business Corporation Law of
Louisiana, adopts the following Articles of Incorporation.
ARTICLE I
Name
The name of the Corporation is Supermarket Cigarette Sales, Inc.
ARTICLE II
Purpose
The purpose of the Corporation is to engage in any lawful activity for
which corporations may be formed under the Business Corporation Law.
ARTICLE III
Capital
The Corporation has authority to issue an aggregate of 10,000 shares of
capital stock, all of which are designated common stock having no par value per
share.
ARTICLE IV
Shareholder Consents
Whenever the affirmative vote of shareholders is required to authorize or
constitute corporate action, the consent in writing to such action signed only
by shareholders holding that proportion of the total voting power on the
question which is required by law or by these Articles of Incorporation,
whichever requirement is higher, shall be sufficient for the purpose, without
necessity for a meeting of shareholders.
<PAGE>
ARTICLE V
Director's Proxies
Any director absent from a meeting of the Board of Directors or any
committee thereof may be represented by any other director or shareholder, who
may cast the vote of the absent director according to the written instructions,
general or special, of the absent director.
ARTICLE VI
Reversion
Cash, property or share dividends, shares issuable to shareholders in
connection with a reclassification of stock, and the redemption price of
redeemed shares, which are not claimed by the shareholders entitled thereto
within one year after the dividend or redemption price became payable or the
shares became issuable, despite reasonable efforts by the Corporation to pay the
dividend or redemption price or deliver the certificates for the shares to such
shareholders within such time, shall, at the expiration of such time, revert in
full ownership to the Corporation, and the Corporation's obligation to pay such
dividend or redemption price or issue such shares, as the case may be, shall
thereupon cease; provided that the board of directors may, at any time, for any
reason satisfactory to it, but need not, authorize (1) payment of the amount of
any cash or property dividend or redemption price or (2) issuance of any shares,
ownership of which has reverted to the Corporation pursuant to this Article VI,
to the entity who or which would be entitled thereto had such reversion not
occurred.
ARTICLE VII
Incorporator
The name and post office address of the incorporator is:
L. R. McMillan, II
22nd Floor
225 Baronne Street
New Orleans, Louisiana
<PAGE>
WITNESSES:
/s/ [ILLEGIBLE] /s/ L. R. McMillan, II
- ------------------------------------ --------------------------------
L. R. McMillan, II, Incorporator
/s/ [ILLEGIBLE]
- ------------------------------------
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF ORLEANS
BEFORE ME, the undersigned authority, personally came and appeared, L. R.
McMillan, II, to me known to be the person who signed the foregoing instrument
as Incorporator, and who, having been duly sworn, acknowledged and declared, in
the presence of the two witnesses whose names are subscribed above, that he
signed such instrument as his free act and deed for the purposes mentioned
therein.
IN WITNESS WHEREOF, the appearer, witnesses and I have hereunto affixed
our hands on this 22nd day of February, 1985, at New Orleans, Louisiana.
WITNESSES:
/s/ [ILLEGIBLE] /s/ L. R. McMillan, II
- ------------------------------------ --------------------------------
L. R. McMillan, II, Incorporator
/s/ [ILLEGIBLE]
- ------------------------------------
/s/ [ILLEGIBLE]
--------------------------------
NOTARY PUBLIC
<PAGE>
INITIAL REPORT BY DOMESTIC CORPORATIONS
(To be filed when the Articles of Incorporation are filed)
(R.S. 1950.12:101;
================================================================================
State of Louisiana
Parish of Orleans
To: The Secretary of State
Baton Rouge, Louisiana
Complying with R.S.1950,12:l0l, Supermarket Cigarette Sales. Inc.
---------------------------------
(Name of Corporation)
hereby makes its initial report as follows:
Municipal Address or Location of its Registered Office
407 Pride Avenue
- --------------------------------------------------------------------------------
Hammond, LA 70401
- --------------------------------------------------------------------------------
Name and Municipal Address or Location of Each Registered Agent
Donald A. Matthews
- --------------------------------------------------------------------------------
407 Pride Avenue
- --------------------------------------------------------------------------------
Hammond, LA 70401
- --------------------------------------------------------------------------------
Names & Addresses of the first Directors (if selected when articles are filed)
Carolyn H. Jones, 3654 Drexler Circle, Mobile, AL 36609
- --------------------------------------------------------------------------------
James H. McDonald, Jr., Post Office Box 32, Point Clear, AL 36564
- --------------------------------------------------------------------------------
James 0. Swanson, 4113 Briarcliff Drive, Mobile, AL 36609
- --------------------------------------------------------------------------------
Dated at New Orleans, Louisiana, on the 22nd day of February, 1995.
/s/ L. R. McMillan, II
-----------------------------------
(To be signed by Each Incorporator)
-----------------------------------
<PAGE>
[ILLEGIBLE] McKenthen
Secretary of State
DOMESTIC CORPORATORS
ANNUAL REPORT
For Period Ending
February 25, 1997
INDICATE ANY CHANGES BELOW INDICATE ANY CHANGES BELOW
68267D
SUPERMARKET CIGARETTE SALES, INC. Registered office Address in Louisiana
KEN FASTON (Do Note Use P.O. Box)
407 PRIDE AVENUE 407 PRIDE AVENUE
HAMMOND, LA 70409 HAMMOND, LA 70409
Issued Shares
72-1029831
- --------------------------------------------------------------------------------
Our records indicate the following registered agents for the corporation.
Indicate any changes below. All agents must have a Louisiana address. New
registered agents require a notarized signature. Delete when necessary.
KEN FASTON
407 PRIDE AVENUE/HAMMOND, LA 70401
- --------------------------------------------------------------------------------
Our records indicate the following officers or directors for the Corporation.
Indicate any changes below. If additional space is needed, attach addendum.
Indicate all offices held by each individual listed. Delete when necessary.
Carolyn H. Jones, TREAS
3654 Drexler Circle, Mobile, AL 36609
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TO BE COMPLETED ONLY BY FOREIGN CORPORATIONS
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TO BE COMPLETED ONLY BY DOMESTIC CORPORATIONS
/s/ Carolyn H. Jones Treasurer (334) 433-0437
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Enclose filing fee of $25.00 Return by: February 25, 1997
Make remittance payable to to: Corporation Division
Secretary of State P.O. Box 94135
Do Not Send Cash Baton Rouge, LA 70864-9125
Phone (504) 925-4704
UNSIGNED REPORTS WILL BE RETURNED
<PAGE>
Exhibit 3.14
BY-LAWS
OF
SUPERMARKET CIGARETTE SALES, INC.
Section 1. OFFICES
1.1 The principal office shall be located at 407 Pride Avenue, Hammond,
Louisiana 70401.
1.2 The corporation may have such offices at such other places as the
Board of Directors may from time to time determine or the business of the
corporation may require.
Section 2. SHAREHOLDERS' MEETINGS
2.1 Unless otherwise required by law or these By-laws, all meetings of
the shareholders shall be held at the principal office of the corporation or at
such other place, within or without the State of Louisiana, as may be designated
by the Board of Directors.
2.2 The annual meeting of the shareholders shall be held on such date and
time as the Board of Directors shall designate, for the purpose of electing
directors and for the transaction of such other business as may properly be
brought before the meeting.
2.3 Special meetings of the shareholders, for any purpose or purposes, may
be called by the President or Board of Directors. At any time, upon the written
request of any two directors or of any shareholder or shareholders holding in
the aggregate one-fifth of the total voting power, the Secretary shall call a
special meeting of shareholders to be held at the registered office of the
corporation at such time as the Secretary may fix, not less than fifteen nor
more than sixty days after the receipt of said request, and if the Secretary
shall neglect or refuse to fix such time or to give notice of the meeting, the
shareholder or shareholders making the request may do so.
2.4 Except as otherwise provided in Section 2.3 hereof, or by law, the
authorized person or persons calling a shareholders' meeting shall cause
written notice of the time, place and purpose
<PAGE>
of the meeting to be given to all shareholders entitled to vote at such meeting,
at least ten days and not more than sixty days prior to the day fixed for the
meeting. Notice of the annual meeting need not state the purpose thereof, unless
action is to be taken at the meeting as to which notice is required by law.
2.5 At every meeting of shareholders, a list of shareholders entitled to
vote, arranged alphabetically and certified by the Secretary or by the agent of
the corporation having charge of transfers of shares, showing the number and
class of shares held by each such shareholder on the record date for the
meeting, shall be produced on the request of any shareholder.
2.6 Except as otherwise provided by law, the presence, in person or by
proxy, of the holders of a majority of the total voting power shall constitute a
quorum at all meetings of the shareholders.
2.7 When a quorum is present at any meeting, the vote of the holders of a
majority of the voting power present in person or represented by proxy shall
decide any question brought before such meeting, unless the question is one upon
which, by express provision of law or the Articles of Incorporation, a different
vote is required, in which case such express provision shall govern and control
the decision of such question. Directors shall be elected by plurality vote.
2.8 At any meeting of the shareholders, every shareholder having the right
to vote shall be entitled to vote in person, or by proxy appointed by an
instrument in writing subscribed by such shareholder and bearing a date not more
than eleven months prior to said meeting, unless said instrument provides for a
longer period. The aforesaid proxy need not be a shareholder of the corporation.
Each shareholder shall have one vote for each share of stock having voting
power, registered in his name on the books of the corporation at the time of the
said meeting or on the record date for the determination of shareholders
entitled to vote at the said meeting is the Board of Directors shall have fixed
such a record date. Except as the Board may provide otherwise, if no record date
is fixed for the purpose of determining shareholders (a) entitled to notice of
and to vote at a meeting, the close of business on the day before the notice of
the meeting is mailed, or if notice is waived, the close of business on the day
before the meeting, shall be the record date for such purpose, or (b) for any
other purpose, the close of business on the day on which the Board of Directors
adopts the resolution relating thereto shall be the record date for such
purpose.
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2.9 Adjournments of any annual or special meeting of shareholders may be
taken without new notice being given unless a new record date is fixed for the
adjourned meeting, but any meeting at which directors are to be elected shall be
adjourned only from day to day until such directors shall have been elected.
2.10 The shareholders present or represented at a duly organized meeting
shall constitute a quorum and may continue to do business until adjournment,
notwithstanding the withdrawal of enough shareholders to leave less than a
quorum as fixed in Section 2.6 of these By-laws, or the refusal of any
shareholders present to vote.
2.11 If a meeting cannot be organized because a quorum has not attended,
those present may adjourn the meeting to such time and place as they may
determine, subject, however, to the provisions of Section 2.9 hereof. In the
case of any meeting called for the election of directors, those who attend the
second of such adjourned meetings, although less than a quorum as fixed in
Section 2.6 hereof, shall nevertheless constitute a quorum for the purpose of
electing directors.
Section 3. DIRECTORS
3.1 All of the corporate powers shall be vested in, and the business and
affairs of the corporation shall be managed by a Board of Directors of three
natural persons. The Board may exercise all such powers of the corporation and
do all such lawful acts and things which are not by law, the Articles of
Incorporation or these By-laws directed or required to be done by the
shareholders. The directors shall be elected at the annual meeting of the
shareholders and shall hold office for one year and until their successors are
chosen and have qualified. No director need be a shareholder.
3.2 The remaining directors, even though not constituting a quorum, may,
by a majority vote, fill any vacancy on the Board (including any vacancy
resulting from an increase in the authorized number of directors, or from
failure of the shareholders to elect the full number of authorized directors)
for an unexpired term, provided that the shareholders shall have the right, at
any special meeting called for the purpose prior to such action by the Board,
to fill the vacancy.
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<PAGE>
Section 4. COMPENSATION OF DIRECTORS
4.1 Directors as such, shall receive such salary for their services as may
be fixed by resolution of the Board of Directors and shall receive their actual
expenses of attendance, if any, for each regular or special meeting of the
Board; provided that nothing herein contained shall be construed to preclude any
director from serving the corporation in any other capacity and receiving
compensation therefor.
Section 5. MEETINGS OF THE BOARD
5.1 The meetings of the Board of Directors may be held at such place
within or without the State of Louisiana as a majority of the directors may from
time to time appoint.
5.2 The first meeting of each newly elected Board shall be held
immediately following the annual shareholders' meeting and at the same place as
the annual meeting, and no notice of such first meeting shall be necessary to
the newly elected directors in order legally to constitute the meeting.
5.3 Regular meetings of the Board may be held, upon five days' written
notice from the President or the Secretary at such time and place either within
or without the State of Louisiana as shall from time to time be determined by
the Board, provided that notice of such determination shall be given to all
Directors. Directors present at any regular or special meeting shall be deemed
to have received due, or to have waived, notice thereof, provided that a
director who participates in a meeting by telephone shall not be deemed to have
received or waived due notice if, at the beginning of the meeting, he objects to
the transaction of any business because the meeting is not lawfully called.
5.4 Special meetings of the Board may be called by the President on two
days' notice given to each director, either personally or by telephone, mail or
by telegram. Special meetings shall be called by the President or Secretary in
like manner and on like notice on the written request of two directors and if
the President and Secretary fail or refuse, or are unable to call a meeting when
requested by any two directors, then the two directors may call the meeting on
two days' written notice given to each director.
5.5 A majority of the Board shall be necessary to constitute a quorum for
the transaction of business, and except as otherwise provided by law, the acts
of a majority of the directors present at a meeting at which a quorum is present
shall be the acts of the Board.
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<PAGE>
5.6 If a quorum is present when the meeting is convened, the directors
present may continue to do business, taking action by vote of a majority of a
quorum as fixed in Section 5.5 hereof, until adjournment, notwithstanding the
withdrawal of enough directors to leave less than a quorum as fixed in Section
5.5 hereof or the refusal of any director present to vote.
5.7 Any action which may be taken at a meeting of the Board or any
committee thereof, may be taken by a consent in writing signed by all of the
directors or by all members of the committee, as the case may be, and filed with
the records of proceedings of the Board or committee.
5.8 Members of the Board may participate at and be present at any meeting
of the Board or any committee thereof by means of conference telephone or
similar communications equipment if all persons participating in such meeting
can hear and communicate with each other.
Section 6. COMMITTEES OF THE BOARD
The Board may designate one or more committees, each committee to consist
of two or more of the directors of the corporation (and one or more directors
may be named as alternate members to replace any absent or disqualified regular
members), which, to the extent provided by resolution of the Board or the
By-laws, shall have and may exercise the powers of the Board in the management
of the business and affairs of the corporation, and may have power to authorize
the seal of the corporation to be affixed to documents. Such committee or
committees shall have such name or names as may be stated in the By-laws, or as
may be determined, from time to time, by the Board. Any vacancy occurring in any
such committee shall be filled by the Board, but the President may designate
another director to serve on the committee pending action by the Board. Each
such committee shall hold office during the term of the Board constituting it,
unless otherwise ordered by the Board.
Section 7. REMOVAL OF BOARD MEMBER
The shareholders, by vote of a majority of the total voting power at any
special meeting called for the purpose, may remove from office any one or more
of the directors, notwithstanding that his or their terms of office may not have
expired, and may
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<PAGE>
forthwith at such meeting proceed to elect a successor for the unexpired term.
Whenever the holders of the shares of any class or series or of any obligations
are entitled to elect one or more directors, the provisions of this Section 7
shall apply, in respect of the removal of a director or directors so elected,
and the election of a successor or successors, to the vote of the holders of the
outstanding shares of that class or series or of those obligations and not to
the vote of the outstanding shares as a whole. If a director has been elected by
the exercise of the privilege of cumulative voting, such director may not be
removed if the votes cast against his removal would be sufficient to elect him
if then cumulatively voted in his favor at an election of the entire board of
directors, or, if there be classes of directors, at an election of the class of
directors of which he is a part.
Section 8. NOTICES
8.1 Any written notice required or permitted by law, the Articles of
Incorporation or the By-laws to be given to any shareholder or director shall
be deemed to have been given to such shareholder or director when such notice is
served upon such shareholder or director or two business days after such notice
is placed in the United States mail, postage prepaid, addressed to such
shareholder or director at his last known address, whichever is earlier.
8.2 Whenever any notice is required to be given by law, the Articles of
Incorporation or the By-laws, a waiver thereof in writing signed by the person
or persons entitled to said notice, whether before or after the time stated
therein, shall be deemed equivalent thereto.
Section 9. OFFICERS
9.1 The officers of the corporation shall be chosen by the directors and
shall be a President, a Secretary and a Treasurer. The directors may elect one
or more Vice Presidents. Any two offices may be held by one person, provided
that no person holding more than one office may sign, in more than one capacity,
any certificate or other instrument required by law to be signed by two
officers.
9.2 The Board of Directors may appoint such other officers as it shall
deem necessary, who shall hold their offices for such terms and shall exercise
such powers and perform such duties as shall be determined from time to time by
the Board.
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<PAGE>
9.3 The officers of the corporation shall hold office at the pleasure of
the Board of Directors.
9.4 The president shall preside at all meetings of the shareholders and
shall have general and active management of the business of the corporation. If
a Chairman of the Board of Directors has not been elected, the President, if a
director, shall preside at all meetings of the Board.
9.5 The Vice-Presidents (if any) in the order specified by the Board or,
if not so specified, in the order of their seniority shall, in the absence or
disability of the President, perform the duties and exercise the powers of the
President, and shall perform such other duties as the President or the Board of
Directors shall prescribe.
9.6 The Secretary shall attend all meetings of the Board of Directors and
all meetings of the shareholders and record all votes and the minutes of all
proceedings in a book to be kept for that purpose. He shall give, or cause to be
given, notice of all meetings of the shareholders and special meetings of the
Board, and shall perform such other duties as may be prescribed by the Board or
President, under whose supervision he shall be. He shall keep in safe custody
the seal of the corporation, if any, and affix the same to any instrument
requiring it.
9.7 The Treasurer shall have the custody of the corporate funds and shall
keep or cause to be kept full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all monies
and other valuable effects in the name and to the credit of the corporation in
such depositories as may be designated by the Board of Directors. He shall keep
a proper accounting of all receipts and disbursements and shall disburse the
funds of the corporation only for proper corporate purposes or as may be ordered
by the Board and shall render to the President and the Board at the regular
meetings of the Board, or whenever they may require it, an account of all his
transactions as Treasurer and of the financial condition of the corporation.
Section 10. STOCK
10.1 Certificates. The certificates for each class of stock of the
corporation shall be numbered and shall be entered in the books of the
corporation as they are issued. Every certificate
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<PAGE>
of stock shall be signed by the President or a Vice-President and the Treasurer
or the Secretary. If any stock certificate is signed by a transfer agent or by a
registrar, other than the corporation itself or an employee of the corporation,
the signature of any such officer may be a facsimile.
10.2 Missing Certificates. The officers of the corporation may direct a
new certificate or certificates to be issued in place of any certificate or
certificates theretofore issued by the corporation alleged to have been lost,
stolen or destroyed, upon the making of an affidavit of that fact by the person
claiming the certificate of stock to be lost, stolen or destroyed. When
authorizing such issue of a new certificate or certificates, the officers of the
Corporation shall, unless dispensed with by the Board, as a condition precedent
to the issuance thereof, require the owner of such lost, stolen or destroyed
certificate or certificates, or his legal representative, to advertise the same
in such manner as such officers shall require and/or give the corporation a bond
in such sum as they may deem appropriate as indemnity against any claim that may
be made against the corporation with respect to the certificate alleged to have
been lost, stolen or destroyed.
10.3 Transfers. Upon surrender to the corporation or the transfer agent of
the corporation, of a certificate for shares duly endorsed or accompanied by
proper evidence of succession, assignment or authority to transfer, it shall be
the duty of the corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon its books.
Section 11. DETERMINATION OF SHAREHOLDERS
11.1 Record Date. For the purpose of determining shareholders entitled to
notice of and to vote at a meeting, or to receive a dividend, or to receive or
exercise subscription or other rights, or to participate in a reclassification
of stock, or in order to make a determination of shareholders for any other
proper purpose, the Board of Directors may fix in advance a record date for
determination of shareholders for such purpose, such date to be not more than
sixty days and, if fixed for the purpose of determining shareholders entitled to
notice of and to vote at a meeting, not less than ten days, prior to the date on
which the action requiring the determination of shareholders is to be taken.
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<PAGE>
11.2 Registered Shareholders. Except as otherwise provided by law, the
corporation, and its directors, officers and agents, may recognize and treat a
person registered on its records as the owner of shares, as the owner in fact
thereof for all purposes, and as the person exclusively entitled to have and to
exercise all rights and privileges incident to the ownership of such shares, and
rights under this Section shall not be affected by any actual or constructive
notice which the corporation, or any of its directors, officers or agents, may
have to the contrary.
Section 12. MISCELLANEOUS
12.1 Dividends. Except as otherwise provided by law or the Articles of
Incorporation, dividends upon the stock of the corporation may be declared by
the Board of Directors at any regular or special meeting. Dividends may be paid
in cash, in property, or in shares of stock.
12.2 Checks. All checks or demands for money and notes of the corporation
shall be signed by such officer or officers or such other person or persons as
the Board of Directors may from time to time designate.
12.3 Fiscal Year. The Board of Directors may adopt for and on behalf of
the corporation a fiscal or a calendar year.
12.4 Seal. The Board of Directors may adopt a corporate seal, which seal
shall have inscribed thereon the name of the corporation. Said seal may be used
by causing it or a facsimile thereof to be impressed or affixed or reproduced or
otherwise. Failure to affix the seal shall not, however, affect the validity of
any instrument.
12.5 Gender. All pronouns and variations thereof used in these By-laws
shall be deemed to refer to the masculine, feminine or neuter gender, singular
or plural, as the identity of the person, persons, entity or entities referred
to require.
Section 13. INDEMNIFICATION
The Corporation shall indemnify its officers and directors, and may
indemnify its employees and agents, and may procure insurance on behalf of its
officers, directors, employees and agents to the full extent permitted by
Section 83 of the Louisiana Business Corporation Law, as amended.
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Section 14. AMENDMENTS
These By-laws may be amended or repealed by the Board of Directors at any
regular or special meeting or by the shareholders at any annual or special
meeting, provided notice of the proposed amendment or repeal be contained in the
notice of such annual or special meeting of shareholders.
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<PAGE>
EXHIBIT 3.15
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
JITNEY-JUNGLE BAKERY, INC.
FIRST: The name of the corporation is Jitney-Jungle Bakery, Inc.
SECOND: The corporation is authorized to issue 15,000 shares of Common
Stock, par value of $10.00 per share. Shareholders shall not have the right to
cumulate their votes for directors nor shall the shareholders be entitled to
multiply the number of votes they are entitled to cast by the number of
directors for whom they are entitled to vote and cast the product for a single
candidate or distribute the product among two (2) or more candidates.
THIRD: The street address of the corporation's registered office is 453
North Mill Street, Jackson, Mississippi 39202, and the name of its registered
agent at that office is W.H. Holman, Jr.
FOURTH: A director of the corporation will not be liable to the
corporation or to its shareholders for monetary damages for any action taken, or
any failure to take action, as a director, except liability for: (i) the amount
of a financial benefit received by a director to which he is not entitled; (ii)
an intentional infliction of harm on the corporation or the shareholders; (iii)
a violation of Section 79-4-8.33 of the Mississippi Code of 1972, as amended; or
(iv) an intentional violation of criminal law. If the Mississippi Business
Corporation Act is amended to authorize corporate action further eliminating or
limiting the personal liability of directors, then the liability of a director
of the corporation shall be eliminated or limited to the fullest extent
permitted by the Mississippi Business Corporation Act, as so amended. Any repeal
or modification of this Article by the shareholders of the corporation shall not
adversely affect any right or protection of a director of the corporation
existing at the time of such repeal or modification.
FIFTH: Provisions with respect to indemnification are as follows:
(A) Definitions. In this article:
(1) "corporation" includes this corporation and any domestic or foreign
predecessor entity of the corporation in a merger or other transaction in which
the predecessor's existence ceased upon consummation of the transaction;
(2) "director" means an individual who is or was a director of the
corporation or an individual who, while a director at the corporation, is or was
serving at the corporation's request as a director, officer, partner, trustee,
employee or agent of another foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise. A director shall be
considered to be serving an employee benefit plan at the
<PAGE>
involve services by, him to the plan or to participants in or beneficiaries of
the plan. "Director" includes, unless the context requires otherwise, the estate
or personal representative of a director;
(3) "expenses" include counsel fees;
(4) "liability" means the obligation to pay a judgment settlement,
penalty, fine (including an excise tax assessed with respect to an employee
benefit plan), or reasonable expenses incurred with respect to a proceeding;
(5) "official capacity" means: (i) when used with respect to a director,
the office of director in the corporation; and (ii) when used with respect to an
individual other than a director as contemplated in Section (G) hereof, the
office in the corporation hold by the officer or the employment or agency
relationship undertaken by the employee or agent on behalf of the corporation.
As used herein, "official capacity" does not include service for any other
foreign or domestic corporation or any partnership, joint venture, trust,
employee benefit plan or other enterprise;
(6) "party" includes an individual who was, is, or is threatened to be
made a named defendant or respondent in a proceeding;
(7) "proceeding" means any threatened, pending, or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative and
whether formal or informal;
(B) Authority to Indemnify. (a) Except as provided in subsection (d)
hereof, the corporation shall indemnify any individual made a party to a
proceeding because he is or was a director against liability incurred in the
proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed:
(i) In the case of conduct in his official capacity with the
corporation, that his conduct was in its best interests; and
(ii) In all other cases, that his conduct was at least not opposed
to its best interests; and
(3) In the case of any criminal proceeding, he had no reasonable cause to
believe his conduct was unlawful.
(b) A directors conduct with respect to an employee benefit plan for a
purpose he reasonably believed to be in the interest of the participants in and
beneficiaries of the plan is conduct that satisfies the requirement of
subsection (a)(2)(ii) of Section (B) hereof.
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(c) The termination of a proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent is not, of
itself, determinative that the director did not meet the standard of conduct
described in this section.
(d) The corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation; or
(2) In connection with any other proceeding charging improper
personal benefit to him, whether or not involving action in
his official capacity, in which he was adjudged liable on the
basis that personal benefit was improperly received by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation shall be limited to reasonable
expenses incurred in connection with the proceeding.
(C) Mandatory Indemnification. Unless otherwise limited by these articles
of incorporation, the corporation shall indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any proceeding to
which he was a party because he is or was a director of the corporation against
reasonable expenses incurred by him in connection with the proceeding.
(D) Advance for Expenses. (a) The corporation shall pay for or reimburse
the reasonable expenses incurred by a director who is a party to a proceeding in
advance of final disposition of the proceeding if:
(1) The director furnishes the corporation a written affirmation
of his good faith belief that he has met the standard of
conduct described in subsection 2 of Section (B) hereof;
(2) The director furnishes the corporation a written undertaking,
executed personally or on his behalf, to repay the advance if
it shall be ultimately determined that he did not meet the
standard of conduct; and
(3) A determination shall be made that the facts then known to
those making the determination would not preclude
indemnification under this article.
(b) The undertaking required by subsection (a)(2) of Section (D) hereof
must be an unlimited general obligation of the director but need not be secured
and may be accepted without reference to financial ability to make repayment.
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(c) Determination and authorizations of payments under this section shall
be made in the manner specified in Section (F) hereof.
(E) Court Ordered Indemnification. Unless these articles of incorporation
provide otherwise, a director of the corporation who is a party to a proceeding
may apply for indemnification to the court conducting the proceeding or to
another court of competent jurisdiction.
(F) Determination and Authorization of Indemnification. (a) The
corporation may not indemnify a director under Section (B) hereof unless
authorized in the specific case after a determination has been made that
indemnification of the director shall be permissible in the circumstances
because he has met the standard of conduct set forth in Section (B) hereof.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum
consisting of directors not at the time parties to the
proceeding;
(2) If a quorum cannot be obtained under subsection (b)(i) of
Section (F) hereof, by majority vote of a committee duly
designated by the board of directors (in which designation
directors who are parties may participate), consisting solely
of two (2) or more directors not at the time parties to the
proceeding;
(3) By special legal counsel:
(i) Selected by the board of directors or its committee in
the manner prescribed in subsection (b)(1) or (b)(2) of
Section (F) hereof; or
(ii) If a quorum of the board of directors cannot not be
obtained under subsection (b)(1) of Section (F) hereof
and a committee cannot be designated under subsection
(b)(2) of Section (F) hereof, selected by a majority
vote of the full board of directors (in which selection
directors who are parties may participate); or
(4) By the shareholders, but shares owned by or voted under the
control of directors who are at the time parties to the
proceeding may not be voted on the determination.
(c) Authorization of indemnification and evaluation as to reasonableness
of expenses shall be made in the same manner as the determination that
indemnification shall be permissible, except that if the determination shall be
made by special legal counsel,
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authorization of indemnification and evaluation as to reasonableness of expenses
shall be made by those entitled under subsection (b)(3) of Section (F) hereof to
select counsel.
(d) The corporation agrees to submit requests for indemnification or
advancement of expenses to the board of directors of the corporation or to the
shareholders of the corporation, as applicable, within a reasonable time after
the director requests in writing that the corporation indemnify the director or
advance expenses to him.
(G) Indemnification of Officers, Employees and Agents. Unless otherwise
provided herein:
(1) An officer of the corporation who is not a director shall be entitled
to mandatory indemnification under Section (C) hereof, and shall be entitled to
apply for court-ordered indemnification under Section (E) hereof, in each case
to the same extent as a director;
(2) The corporation shall indemnify and advance expenses under this
article to an officer of the corporation who is not a director to the same
extent as to a director; and
(3) The corporation shall also indemnify and advance expenses to an
officer who is not a director to the extent, consistent with public policy, that
may be provided by the articles of incorporation, bylaws, general or specific
action of the board of directors or contract.
(H) Right of Corporation to Insure. The corporation may purchase and
maintain insurance on behalf of an individual who is or was a director, officer,
employee or agent of the corporation or who, while a director, officer, employee
or agent of the corporation, is or was serving at the request of the corporation
as a director, officer, partner, trustee, employee or agent of another foreign
or domestic corporation, partnership, joint venture, trust, employee benefit
plan or other enterprise, against liability asserted against or incurred by him
in that capacity or arising from his status as a director, officer, employee or
agent, whether or not the corporation would have power to indemnify him against
such liability under Sections (B) or (C) hereof or applicable law.
(I) Application of Article. (a) Unless these articles of incorporation
provide otherwise, any authorization of indemnification in the articles of
incorporation or the bylaws shall not be deemed to prevent the corporation from
providing the indemnity permitted or mandated by applicable law.
(b) The board of directors of the corporation shall have power to make any
further indemnity, including advance of expenses, to and to enter contracts of
indemnity with any director, officer, employee or agent, except an indemnity
against his gross negligence or willful misconduct. Any determination as to any
further indemnity shall be made in accordance with subsection (b) of Section (F)
hereof. Each such indemnity may
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continue as to a person who has ceased to have the capacity referred to above
and may inure to the benefit of the heirs, executors and administrators of such
person.
(c) The corporation shall pay or reimburse expenses incurred by a director
in connection with his appearance as a witness in a proceeding at a time when he
has not been made a named defendant or respondent to the proceeding when his
appearance as a witness is in connection with his serving as a director of the
corporation.
(J) Right to Bring Action to Enforce. The rights to indemnification and to
the advancement of expenses conferred under this article shall be contract
rights. If a claim under this article is not paid in full by the corporation
within 90 days after a written claim has been received by the corporation, the
director making such claim may at any time thereafter bring suit against the
corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, the director shall be entitled to be paid also the expense of
prosecuting such claim. It shall be a defense to any such action that the
director has not met the standards of conduct which make it permissible under
this article or the laws of the State of Mississippi for the corporation to
indemnify the director for the amounts claimed, but the burden of proving such
defense shall be on the corporation. Neither the failure of the corporation
(including its board of directors, independent legal counsel, or its
shareholders) to have made a determination prior to the commencement of such
action that indemnification of the director shall be proper in the circumstances
because he has met the applicable standard of conduct set forth under the laws
of the State of Mississippi or under these articles of incorporation, nor an
actual determination by the corporation (including its board of directors,
independent legal counsel, or its shareholders) that the director had not met
such applicable standard of conduct, shall be a defense to the action or create
a presumption that the director had not met the applicable standard of conduct.
Dated: March 5, 1996.
JITNEY-JUNGLE BAKERY, INC.
By: /s/ W.H. Holman, Jr.
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W.H. Holman, Jr., Chairman and CEO
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EXHIBIT 3.16
RESTATED BYLAWS
OF
JITNEY-JUNGLE BAKERY, INC.
ARTICLE I. PRINCIPAL OFFICE
The principal office of the corporation in the State of Mississippi shall
be located in the City of Jackson, County of Hinds. The corporation may have
such other offices, either within or without the State of Mississippi, as the
board of directors may designate or as the business of the corporation may
require from time to time.
ARTICLE II. SHAREHOLDERS
SECTION 1. Annual Meeting. The annual meeting of the shareholders shall be
held on the third Wednesday in the month of October, in each year at the hour of
10:00 o'clock, A.M., or such other time and date as may be determined by the
directors, for the purpose of electing directors and for the transaction of such
other business as may properly come before the meeting. If the day fixed for the
annual meeting shall be a legal holiday in the State of Mississippi, such
meeting shall be held on the next succeeding business day.
If the election of directors shall not be held on the day designated
herein for any annual meeting of the shareholders, or at any adjournment
thereof, the board of directors shall cause the election to be held at a special
meeting of the shareholders as soon thereafter as conveniently may be.
SECTION 2. Special Meetings. The corporation shall hold a special meeting
of shareholders (1) on call of its board of directors or the president; or (2)
unless the articles of incorporation provide otherwise, if the holders of at
least ten percent (10%) of all the votes entitled to be cast on any issue
proposed to be considered at the proposed special meeting sign, date and deliver
to the corporation's secretary one or more written demands for the meeting
describing the purpose or purposes for which it is to be held. If not otherwise
fixed under applicable law, the record date for determining shareholders
entitled to demand a special meeting shall be the date the first shareholder
signs the demand.
SECTION 3. Place of Meeting. The board of directors may designate any
place, either within or without the State of Mississippi, for any annual meeting
or for any special meeting of shareholders. A valid waiver of notice signed by
all shareholders entitled to notice may designate any place, either within or
without the State of Mississippi, as the
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place for any annual meeting or for any special meeting of shareholders. Unless
the notice of the meeting states otherwise, shareholders' meetings shall be held
at the corporation's principal office.
SECTION 4. Notice of Meeting. The corporation shall notify shareholders of
the date, time and place of each annual and special shareholders' meeting no
fewer than ten (10) nor more than sixty (60) days before the meeting date.
Unless applicable law or the articles of incorporation require otherwise, the
corporation shall give notice only to shareholders entitled to vote at the
meeting.
Unless applicable Law or the articles of incorporation require otherwise,
notice of an annual meeting need not include a description of the purpose or
purposes for which the meeting is called. Notice of a special meeting must
include a description of the purpose or purposes for which the meeting shall be
called. Only business within the purpose or purposes described in the meeting
notice may be conducted at a special shareholders' meeting.
Unless these bylaws require otherwise, if an annual or special
shareholders' meeting is adjourned to a different date, time or place, notice
need not be given of the new date, time or place if the new date, time or place
is announced at the meeting before adjournment. If a new record date for the
adjourned meeting is or must be fixed under applicable law or Article II,
Section 5 of these bylaws, however, notice of the adjourned meeting must be
given under this section to persons who are shareholders as of the new record
date.
SECTION 5. Closing of Transfer Books or Fixing of Record Date. The board
of directors of the corporation may fix the record date for one or more voting
groups in order to determine shareholders entitled to notice of a shareholders'
meeting, to demand a special meeting, to vote or to take any other action. A
record date may not be more than seventy (70) days before the meeting or action
requiring a determination of shareholders. If not otherwise fixed by law, the
record date for determining shareholders entitled to notice of and to vote at an
annual or special shareholders' meeting shall be the day before the first notice
is delivered to shareholders. If the board of directors does not fix the record
date for determining shareholders entitled to a distribution (other than one
involving a purchase, redemption or other acquisition of the corporation's
shares), it shall be the date the board of directors authorizes the
distribution. A determination of shareholders entitled to notice of or to vote
at a shareholders' meeting shall be effective for any adjournment of the meeting
unless the board of directors fixes a new record date, which it must do if the
meeting is adjourned to a date more than one hundred twenty (120) days after the
date fixed for the original meeting.
SECTION 6. Voting Lists. After fixing a record date for a meeting, the
corporation shall prepare an alphabetical list of the names of all its
shareholders who are entitled to
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notice of a shareholders' meeting. The list must be arranged by voting group
(and within each voting group by class or series of shares) and show the address
of and number of shares held by each shareholder.
The shareholders' list must be available for inspection by any shareholder
beginning two (2) business days after notice of the meeting is given for which
the list was prepared and continuing through the meeting, at the corporation's
principal office or at a place identified in the meeting notice in the city
where the meeting will be held. A shareholder, his agent or attorney shall be
entitled on written demand to inspect and, subject to the requirements of
applicable law, to copy the list during regular business hours and at his
expense, during the period it shall be available for inspection. The corporation
shall make the shareholders' list available at the meeting, and any shareholder,
his agent or attorney shall be entitled to inspect the list at any time during
the meeting or any adjournment.
SECTION 7. Quorum. Shares entitled to vote as a separate voting group may
take action on a matter at a meeting only if a quorum of those shares exists
with respect to that matter. Unless the articles of incorporation or applicable
law impose other quorum requirements, a majority of the votes entitled to be
cast on the matter by a voting group, represented in person or by proxy, shall
constitute a quorum of that voting group for action on that matter. If less than
a majority of the outstanding shares are represented at a meeting, a majority of
the shares so represented may adjourn the meeting from time to time without
further notice except as may be required by Article II, Section 4 of these
bylaws or by applicable law. At such adjourned meeting at which a quorum shall
be present or represented, any business may be transacted which might have been
transacted at the meeting as originally noticed. Once a share is represented for
any purpose at a meeting, it shall be deemed present for quorum purposes for the
remainder of the meeting and for any adjournment of that meeting unless a new
record date is or must be set for that adjourned meeting.
SECTION 8. Proxies. A shareholder may appoint a proxy to vote or otherwise
act for him by signing an appointment form, either personally or by his
attorney-in-fact. An appointment of a proxy shall be effective when received by
the secretary or other officer or agent authorized to tabulate votes of the
corporation. An appointment shall be valid for eleven (11) months unless a
longer period is expressly provided in the appointment form. An appointment of a
proxy shall be revocable by the shareholder unless the appointment form
conspicuously states that it is irrevocable and the appointment shall be coupled
with an interest. Appointments coupled with an interest include the appointment
of (1) a pledgee; (2) a person who purchased or agreed to purchase the shares;
(3) a creditor of the corporation who extended it credit under terms requiring
the appointment; (4) an employee of the corporation whose employment contract
requires the appointment; or (5) a party to a voting agreement created under
applicable law.
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The death or incapacity of the shareholder appointing a proxy does not
affect the right of the corporation to accept the proxy's authority unless
notice of the death or incapacity shall be received by the secretary or other
officer or agent authorized to tabulate votes before the proxy exercises his
authority under the appointment. An appointment made irrevocable because it is
coupled with an interest shall be revoked when the interest with which it is
coupled is extinguished. A transferee for value of shares subject to an
irrevocable appointment may revoke the appointment if he did not know of its
existence when he acquired the shares and the existence of the irrevocable
appointment was not noted conspicuously on the certificate representing the
shares or on the information statement for shares without certificates.
Subject to applicable law and to any express limitation on the proxy's
authority appearing on the face of the appointment form, the corporation shall
be entitled to accept the proxy's vote or other action as that of the
shareholder making the appointment.
SECTION 9. Voting of Shares. Except as provided below or unless the
articles of incorporation provide otherwise, and subject to the provisions of
Section 12 of this Article II, each outstanding share, regardless of class,
shall be entitled to one (1) vote on each matter voted on at a shareholders'
meeting. If a quorum exists, action on a matter (other than the election of
directors) by a voting group shall be approved if the votes cast within the
voting group favoring the action exceed the votes cast opposing the action,
unless the articles of incorporation or applicable law require a greater number
of affirmative votes. Unless otherwise provided in the articles of
incorporation, directors shall be elected by a plurality of the votes cast by
the shares entitled to vote in the election at a meeting at which a quorum is
present.
SECTION 10. Voting of Shares by Certain Holders. Shares standing in the
name of another corporation may be voted by such officer, agent or proxy as the
bylaws of such corporation may prescribe, or, in the absence of such provision,
as the board of directors of such corporation may determine.
Absent special circumstances, shares of this corporation shall not be
entitled to vote if they are owned, directly or indirectly, by a second
corporation, domestic or foreign, and this corporation owns, directly or
indirectly, a majority of the shares of the second corporation entitled to vote
for the directors of the second corporation. This does not limit the power of
this corporation to vote any shares, including its own shares, held by it in a
fiduciary capacity.
Shares held by an administrator, executor, guardian or conservator may be
voted by him, either in person or by proxy, without a transfer of such shares
into his name. Shares standing in the name of a trustee may be voted by him,
either in person or by proxy, but no trustee shall be entitled to vote shares
held by him without a transfer of such shares into his name. Shares standing in
the name of a receiver may be voted by such
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receiver, and shares held by or under the control of a receiver may be voted by
such receiver without the transfer thereof into his name if authority so to do
be contained in an appropriate order of the court by which such receiver was
appointed.
A shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee, and
thereafter the pledgee shall be entitled to vote the shares so transferred.
SECTION 11. Informal Action by Shareholders. Action required or permitted
by applicable law to be taken at a shareholders' meeting may be taken without a
meeting if the action is taken by all the shareholders entitled to vote on the
action. The action must be evidenced by one or more written consents describing
the action taken, signed by all the shareholders entitled to vote on the action,
and delivered to the corporation for inclusion in the minutes or filing with the
corporate records. If not otherwise determined under applicable law, the record
date for determining shareholders entitled to take action without a meeting
shall be the date the first shareholder signs such consent. A consent signed
under this section has the effect of a meeting vote and may be described as such
in any document.
If applicable law requires that notice of proposed action be given to
nonvoting shareholders and the action is to be taken by unanimous consent of the
voting shareholders, the corporation must give its nonvoting shareholders
written notice of the proposed action at least ten (10) days before the action
is taken. The notice must contain or be accompanied by the same material that,
under applicable law, would have been required to be sent to nonvoting
shareholders in a notice of meeting at which the proposed action would have been
submitted to the shareholders for action.
SECTION 12. No Cumulative Voting. Shareholders shall not have the right to
cumulate their votes for directors nor shall the shareholders be entitled to
multiply the number of votes they are entitled to cast by the number of
directors for whom they are entitled to vote and cast the product for a single
candidate or distribute the product among two (2) or more candidates.
SECTION 13. Shares Held by Nominees. The corporation may establish a
procedure by which the beneficial owner of shares that are registered in the
name of a nominee shall be recognized by the corporation as the shareholder. The
extent of this recognition may be determined in the procedure. The procedure may
set forth: (1) the types of nominees to which it applies; (2) the rights or
privileges that the corporation recognizes in a beneficial owner; (3) the manner
in which the procedure shall be selected by the nominee; (4) the information
that must be provided when the procedure is selected; (5) the period for which
selection of the procedure shall be effective; and (6) other aspects of the
rights and duties created.
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SECTION 14. Corporation's Acceptance of Votes. If the name signed on a
vote, consent, waiver or proxy appointment corresponds to the name of the
shareholder, the corporation, if acting in good faith, shall be entitled to
accept the vote, consent, waiver or proxy appointment and give it effect as the
act of the shareholder.
If the name signed on a vote, consent, waiver or proxy appointment does
not correspond to the name of its shareholder, the corporation, if acting in
good faith, shall nevertheless be entitled to accept the vote, consent, waiver
or proxy appointment and give it effect as the act of the shareholder if: (1)
the shareholder is an entity and the name signed purports to be that of an
officer or agent of the entity; (2) the name signed purports to be that of an
administrator, executor, guardian or conservator representing the shareholder
and, if the corporation requests, evidence of fiduciary status acceptable to the
corporation has been presented with respect to the vote, consent, waiver or
proxy appointment; (3) the name signed purports to be that of a receiver or
trustee in bankruptcy of the shareholder and, if the corporation requests,
evidence of this status acceptable to, the corporation has been presented with
respect to the vote, consent, waiver or proxy appointment; (4) the name signed
purports to be that of a pledgee, beneficial owner or attorney-in-fact of the
shareholder and, if the corporation requests, evidence acceptable to the
corporation of the signatory's authority to sign for the shareholder has been
presented with respect to the vote, consent, waiver or proxy appointment; (5)
two (2) or more persons are the shareholders as covenants or fiduciaries and the
name signed purports to be the name of at least one (1) of the co-owners and the
person signing appears to be acting on behalf of all the co-owners.
The corporation shall be entitled to reject a vote, consent, waiver or
proxy appointment if the secretary or other officer or agent authorized to
tabulate votes, acting in good faith, has reasonable basis for doubt about the
validity of the signature on it or about the signatory's authority to sign for
the shareholder.
ARTICLE III. BOARD OF DIRECTORS
SECTION 1. General Powers. All corporate powers shall be exercised by or
under the authority of, and the business and affairs of the corporation managed
under the direction of, its board of directors, subject to any limitation set
forth in the articles of incorporation.
SECTION 2. Number, Election, Tenure and Qualifications. The number of
directors of the corporation shall consist of no less than four and no more than
twelve members, the number thereof to be determined by the directors from time
to time. Notwithstanding the foregoing, the number of directors may be increased
to more than twelve to provide for additional directors that holders of any
series or class of preferred stock are entitled to elect pursuant to the terms
thereof, as necessary. Directors are
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elected at the first annual shareholders' meeting and at each annual meeting
thereafter unless their terms are staggered in the articles of incorporation.
The terms of the initial directors of the corporation expire at the first
shareholders' meeting at which directors shall be elected. The terms of all
other directors expire at the next annual shareholders' meeting following their
election unless their terms shall be staggered in the articles of incorporation.
A decrease in the number of directors does not shorten an incumbent director's
term. The term of a director elected to fill a vacancy expires at the next
shareholders' meeting at which directors shall be elected. Despite the
expiration of a director's term, he continues to serve until his successor shall
be elected and qualifies or until there shall be a decrease in the number of
directors. A director need not be a resident of this state or a shareholder of
the corporation.
SECTION 3. Resignation of Directors; Removal of Directors by Shareholders.
(a) A director may resign at any time by delivering written notice to the board
of directors, to its chairman or to the corporation. A resignation shall be
effective when the notice is delivered unless the notice specifies a later
effective date.
(b) The shareholders may remove one or more directors with or without
cause unless the articles of incorporation provide that directors may be removed
only for cause. If a director is elected by a voting group of shareholders, only
the shareholders of that voting group may participate in the vote to remove him.
If cumulative voting is authorized, a director may not be removed if the number
of votes sufficient to elect him under cumulative voting is voted against his
removal. If cumulative voting is not authorized, a director may be removed only
if the number of votes cast to remove him exceeds the number of votes cast not
to remove him. A director may be removed by the shareholders only at a meeting
called for the purpose of removing him and the meeting notice must state that
the purpose, or one (1) of the purposes, of the meeting shall be removal of the
director.
SECTION 4. Regular Meetings. Unless the articles of incorporation or these
bylaws provide otherwise, a regular meeting of the board of directors shall be
held without other notice than this bylaw immediately after, and at the same
place as, the annual meeting of shareholders. In addition, a regular meeting of
the board of directors shall be held at least once every fiscal quarter at such
time as may be fixed by resolution of the board of directors, provided notice of
any such quarterly meeting must be preceded by at least three (3) business days
notice of the date, time and place of the meeting.
SECTION 5. Special Meetings. Special meetings of the board of directors
may be called by or at the request of the chairperson of the board of directors
or any one (1) or more directors. Unless the articles of incorporation or these
bylaws provide for a longer or shorter period, special meetings of the board of
directors must be preceded by at least three (3) business days' notice of the
date, time and place of the meeting. If no place for the meeting has been
designated in the notice, the meeting shall be held at the principal
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SECTION 2. Election and Term of Officers. The officers of the corporation
to be elected by the board of directors shall be elected annually by the board
of directors at the regular meeting of the board of directors immediately
following the annual meeting of the shareholders. If the election of officers
shall not be held at such meeting, such election shall be held as soon
thereafter as conveniently may be. Each officer shall continue to serve until
his successor is elected and qualifies or until his death or until he shall
resign or shall have been removed in the manner hereinafter provided.
SECTION 3. Resignation or Removal of Officers and Agents. (a) An officer
or agent may resign at any time by delivering written notice to the board of
directors, to its chairman or to the corporation. A resignation shall be
effective when the notice is delivered unless the notice specifies a later
effective date.
(b) Any officer or agent may be removed by the board of directors whenever
in its judgment, the best interests of the corporation will be served thereby,
but such removal shall be without prejudice to the contract rights, if any, of
the person so removed. Election or appointment of an officer or agent shall not
of itself create contract rights.
SECTION 4. Vacancies. A vacancy in any office because of death,
resignation, removal, disqualification or otherwise, may be filled by the board
of directors for the unexpired portion of the term.
SECTION 5. Chairman of the Board. The chairman of the board shall be the
chief executive officer of the corporation and must be a member of the board of
directors at the time of election to such office. When present he shall preside
at all meetings of the shareholders and of the board of directors. He may sign,
with the president and secretary or any other proper officer of the corporation
thereunto authorized by the board of directors, any deeds, mortgages, bonds,
contracts or other instruments which the board of directors has authorized to be
executed, except in cases where the signing and execution thereof shall be
expressly delegated by the board of directors or by these bylaws to some other
officer or agent of the corporation, or shall be required by law to be otherwise
signed or executed; and in general shall perform all duties incident to the
office of chairman of the board and such other duties as may be prescribed by
the board of directors from time to time.
SECTION 6. President. The president shall be the chief operating officer
of the corporation and, subject to the control of the chairman and the board of
directors, shall have general supervision and control of the business and
affairs of the corporation. In the absence of the chairman of the board of
directors, he shall, when present, preside at all meetings of the shareholders
and of the board of directors. He may sign, with the secretary or any other
proper officer of the corporation thereunto authorized by the board of
directors, certificates for shares of the corporation, any deeds, mortgages,
bonds, contracts, or other instruments which the board of directors has
authorized to be executed, except in cases where the signing and execution
thereof shall be expressly delegated by
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the board of directors or by these bylaws to some other officer or agent of the
corporation, or shall be required by law to be otherwise signed or executed; and
in general shall perform all duties incident to the office of president and such
other duties as may be prescribed by the board of directors from time to time.
SECTION 7. Vice President. In the absence of the president or in the event
of his death, inability or refusal to act, the vice president shall perform the
duties of the president, and when so acting, shall have all the powers of and be
subject to all the restrictions upon the president. The vice president shall
perform such other duties as from time to time may be assigned to him by the
president or by the board of directors.
SECTION 8. Secretary. The secretary shall (a) prepare and keep the minutes
of the directors' and shareholders' meetings in one or more books provided for
that purpose; (b) see that all notices are duly given in accordance with the
provisions of these bylaws or as required by law; (c) be custodian of the
corporate records and of the seal of the corporation and see that the seal of
the corporation is affixed to all documents the execution of which on behalf of
the corporation under its seal is duly authorized; (d) authenticate records of
the corporation; (e) keep a register of the post office address of each
shareholder which shall be furnished to the secretary by such shareholder; (f)
sign with the president, certificates for shares of the corporation, the
issuance of which shall have been authorized by resolutions of the board of
directors; (g) have general charge of the stock transfer books of the
corporation; (h) in general perform all duties incident to the office of
secretary and such other duties as from time to time may be assigned to him by
the president or by the board of directors.
SECTION 9. Treasurer. The treasurer shall: (a) have charge and custody of
and be responsible for all funds and securities of the corporation; (b) receive
and give receipts for monies due and payable to the corporation from any source
whatsoever, and deposit all such monies in the name of the corporation in such
banks, trust companies or other depositories as shall be selected in accordance
with these bylaws; and (c) in general perform all of the duties incident to the
office of treasurer and such other duties as from time to time may be assigned
to him by the president or by the board of directors. If required by the board
of directors, the treasurer shall give a bond for the faithful discharge of his
duties in such sum and with such surety or sureties as the board of directors
shall determine.
SECTION 10. Compensation. The board of directors may fix the compensation
of the officers. No such payment shall preclude any officer from serving the
corporation in any other capacity and receiving compensation therefor.
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ARTICLE V. CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1. Contracts. The board of directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute and deliver any
instrument in the name of and on behalf of the corporation, and such authority
may be general or confined to specific instances.
SECTION 2. Loans. No loans shall be contracted on behalf of the
corporation and no evidences of indebtedness shall be issued in its name unless
authorized by a resolution of the board of directors. Such authority may be
general or confined to specific instances.
SECTION 3. Checks, Drafts, Etc. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation, shall be signed by such officer or officers, agent or agents of
the corporation and in such manner as shall from time to time be determined by
resolution of the board of directors.
SECTION 4. Deposits. All funds of the corporation not otherwise employed
shall be deposited from time to time to the credit of the corporation in such
banks, companies or other depositories as the board of directors may select.
ARTICLE VI. CERTIFICATES FOR SHARES AND THEIR TRANSFER
SECTION 1. Certificates for Shares. Shares shall be represented by
certificates. Certificates representing shares of the corporation shall be in
such form as shall be determined by the board of directors. At a minimum, each
share certificate must state on its face (1) the name of the corporation and
that the corporation is organized under the law of the State of Mississippi; (2)
the name of the person to whom issued; and (3) the number and class of shares
and the designation of the series, if any, the certificate represents. If the
corporation is authorized to issue different classes of shares or different
series within a class, the designations, relative rights, preferences and
limitations applicable to each class and the variations in rights, preferences
and limitations determined for each series (and the authority of the board of
directors to determine variations for future series) must be summarized on the
front or back of each certificate or the corporation must furnish the
shareholder this information on request in writing and without charge.
Each share certificate must be signed (either manually or in facsimile) by
the president or a vice president and by the secretary or an assistant secretary
or by such other officers designated in the bylaws or by the board of directors
so to do, and may be sealed with the corporate seal. If the person who signed
(either manually or in facsimile) a share certificate no longer holds office
when the certificate is issued, the certificate is nevertheless valid.
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All certificates for shares shall be consecutively numbered or otherwise
identified. The name and address of the person to whom the shares represented
thereby are issued, with the number of shares and date of issue, shall be
entered on the stock transfer books of the corporation. All certificates
surrendered to the corporation for transfer shall be cancelled and no new
certificate shall be issued until the former certificate for a like number of
shares shall have been surrendered and cancelled, except that in the case of a
lost, destroyed, or mutilated certificate a new one may be issued therefor upon
such terms and indemnity to the corporation as the board of directors may
prescribe.
SECTION 2. Transfer of Shares. Transfer of shares of the corporation shall
be made only on the stock transfer books of the corporation by the holder of
record thereof or by his legal representative, who shall furnish proper evidence
of authority to transfer, or by his attorney thereunto authorized by power of
attorney duly executed and filed with the secretary of the corporation, and on
surrender for cancellation of the certificate for such shares.
ARTICLE VII. INDEMNIFICATION
SECTION 1. Definitions. In this article:
(1) "Corporation" includes this corporation and any domestic or foreign
predecessor entity of the corporation in a merger or other transaction in which
the predecessor's existence ceased upon consummation of the transaction.
(2) "Director" means an individual who is or was a director of the
corporation or an individual who, while a director of the corporation, is or was
serving at the corporation's request as a director, officer, partner, trustee,
employee or agent of another foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise. A director shall be
considered to be serving an employee benefit plan at the corporation's request
if his duties to the corporation also impose duties on, or otherwise involve
services by, him to the plan or to participants in or beneficiaries of the plan.
"Director" includes, unless the context requires otherwise, the estate or
personal representative of a director.
(3) "Expenses" include counsel fees.
(4) "Liability" means the obligation to pay a judgment, settlement,
penalty, fine (including an excise tax assessed with respect to an employee
benefit plan), or reasonable expenses incurred with respect to a proceeding.
(5) "Official capacity" means: (i) when used with respect to a director,
the office of director in the corporation; and (ii) when used with respect to an
individual other than a director as contemplated in Article VII, Section 7, the
office in the corporation held by the officer or the employment or agency
relationship undertaken by the employee or agent on
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behalf of the corporation. "Official Capacity" does not include service for any
other foreign or domestic corporation or any partnership, joint venture, trust,
employee benefit plan or other enterprise.
(6) "Party" includes an individual who was, is, or is threatened to be
made a named defendant or respondent in a proceeding.
(7) "Proceeding" means any threatened, pending, or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative and
whether formal or informal.
SECTION 2. Authority to Indemnity. (a) Except as provided in subsection
(d), the corporation shall indemnify any individual made a party to a proceeding
because he is or was a director against liability incurred in the proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed:
(i) In the case of conduct in his official capacity with the
corporation, that his conduct was in its best interests; and
(ii) In all other cases, that his conduct was at least not opposed
to its best interests; and
(3) In the case of any criminal proceeding, he had no reasonable cause
to believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for a
purpose he reasonably believed to be in the interest of the participants in and
beneficiaries of the plan is conduct that satisfies the requirement of
subsection (a)(2)(ii).
(c) The termination of a proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent is not, of
itself, determinative that the director did not meet the standard of conduct
described in this section.
(d) The corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation; or
(2) In connection with any other proceeding charging improper personal
benefit to him, whether or not involving action in his official
capacity,
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<PAGE>
in which he was adjudged liable on the basis that personal benefit
was improperly received by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation shall be limited to reasonable
expenses incurred in connection with the proceeding.
SECTION 3. Mandatory Indemnification. Unless limited by the articles of
incorporation, the corporation shall indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any proceeding to
which he was a party because he is or was a director of the corporation against
reasonable expenses incurred by him in connection with `the proceeding.
SECTION 4. Advance for Expenses. (a) The corporation shall pay for or
reimburse the reasonable expenses incurred by a director who is a party to a
proceeding in advance of final disposition of the proceeding if:
(1) The director furnishes the corporation a written affirmation
of his good faith belief that he has met the standard of
conduct described in Article VII, Section 2;
(2) The director furnishes the corporation a written undertaking,
executed personally or on his behalf, to repay the advance if
it shall be ultimately determined that he did not meet the
standard of conduct; and
(3) A determination shall be made that the facts then known to
those making the determination would not preclude
indemnification under this Article.
(b) The undertaking required by subsection (a)(2) must be an unlimited
general obligation of the director but need not be secured and may be accepted
without reference to financial ability to make repayment.
(c) Determination and authorizations of payments under this section shall
be made in the manner specified in Article VII, Section 6.
SECTION 5. Court Ordered Indemnification. Unless the corporation's
articles of incorporation provide otherwise, a director of the corporation who
is a party to a proceeding may apply for indemnification to the court conducting
the proceeding or to another court of competent jurisdiction.
SECTION 6. Determination and Authorization of Indemnification. (a) The
corporation may not indemnify a director under Article VII, Section 2 unless
authorized in
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<PAGE>
the specific case after a determination has been made that indemnification of
the director shall be permissible in the circumstances because he has met the
standard of conduct set forth in Article VII, Section 2.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum
consisting of directors not at the time parties to the
proceeding;
(2) If a quorum cannot be obtained under subsection (b)(1), by
majority vote of a committee duly designated by the board of
directors (in which designation directors who are parties may
participate), consisting solely of two (2) or more directors
not at the time parties to the proceeding;
(3) By special legal counsel:
(i) Selected by the board of directors or its committee in
the manner prescribed in subsection (b)(1) or (b)(2); or
(ii) If a quorum of the board of directors cannot be obtained
under subsection (b)(1) and a committee cannot be
designated under subsection (b)(2), selected by a
majority vote of the full board of directors (in which
selection directors who are parties may participate); or
(4) By the shareholders, but shares owned by or voted under the
control of directors who are at the time parties to the
proceeding may not be voted on the determination.
(c) Authorization of indemnification and evaluation as to reasonableness
of expenses shall be made in the same manner as the determination that
indemnification shall be permissible, except that if the determination shall be
made by special legal counsel, authorization of indemnification and evaluation
as to reasonableness of expenses shall be made by those entitled under
subsection (b)(3) to select counsel.
(d) The corporation agrees to submit requests for indemnification or
advancement of expenses to the board of directors of the corporation or to the
shareholders of the corporation, as applicable, within a reasonable time after
the director requests in writing that the corporation indemnify the director or
advance expenses to him.
SECTION 7. Indemnification of Officers, Employees and Agents. Unless the
corporation's articles of incorporation provide otherwise:
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<PAGE>
(1) An officer of the corporation who is not a director shall be entitled
to mandatory indemnification under Article VII, Section 3, and shall be entitled
to apply for court-ordered indemnification under Article VII, Section 5, in each
case to the same extent as a director;
(2) The corporation shall indemnify and advance expenses under this
article to an officer, employee or agent of the corporation who is not a
director to the same extent as to a director; and
(3) The corporation shall also indemnify and advance expenses to an
officer, employee or agent who is not a director to the extent, consistent with
public policy, that may be provided by the articles of incorporation, bylaws,
general or specific action of the board of directors or contract.
SECTION 8. Right of Corporation to Insure. The corporation may purchase
and maintain insurance on behalf of an individual who is or was a director,
officer, employee or agent of the corporation or who, while a director, officer,
employee or agent of the corporation, is or was serving at the request of the
corporation as a director, officer, partner, trustee, employee or agent of
another foreign or domestic corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, against liability asserted against or
incurred by him in that capacity or arising from his status as a director,
officer, employee or agent, whether or not the corporation would have power to
indemnify him against such liability under Article VII, Sections 2 or 3 or
applicable law.
SECTION 9. Application of Article. (a) Unless the articles of
incorporation or these bylaws provide otherwise, any authorization of
indemnification in the articles of incorporation or these bylaws shall not be
deemed to prevent the corporation from providing the indemnity permitted or
mandated by applicable law.
(b) The board of directors of the corporation shall have power to make any
further indemnity, including advance of expenses, to and to enter contracts of
indemnity with any director, officer, employee or agent, except an indemnity
against his gross negligence or willful misconduct. Any determination as to any
further indemnity shall be made in accordance with subsection (b) of Article
VII, Section 6. Each such indemnity may continue as to a person who has ceased
to have the capacity referred to above and may inure to the benefit of the
heirs, executors and administrators of such person.
(c) The corporation shall pay or reimburse expenses incurred by a director
in connection with his appearance as a witness in a proceeding at a time when he
has not been made a named defendant or respondent to the proceeding when his
appearance as a witness is in connection with his serving as a director of the
corporation.
SECTION 10. Right to Bring Action to Enforce. The rights to
indemnification and to the advancement of expenses conferred under this article
shall be contract rights. If a
17
<PAGE>
claim under this article is not paid in full by the corporation within 90 days
after a written claim has been received by the corporation, the director making
such claim may at any time thereafter bring suit against the corporation to
recover the unpaid amount of the claim and, if successful in whole or in part,
the director shall be entitled to be paid also the expense of prosecuting such
claim. It shall be a defense to any such action that the director has not met
the standards of conduct which make it permissible under this article or the
laws of the State of Mississippi for the corporation to indemnify the director
for the amounts claimed, but the burden of proving such defense shall be on the
corporation. Neither the failure of the corporation (including its board of
directors, independent legal counsel, or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the director shall be proper in the circumstances because he has met the
applicable standard of conduct set forth under the laws of the State of
Mississippi or under this Agreement, nor an actual determination by the
corporation (including its board of directors, independent legal counsel, or its
shareholders) that the director had not met such applicable standard of conduct,
shall be a defense to the action or create a presumption that the director had
not met the applicable standard of conduct.
ARTICLE VIII. NOTICE
Notice shall be in writing unless oral notice is reasonable under the
circumstances. Notice may be communicated in person; by telephone, telegraph,
teletype or other form of wire or wireless communication; or by mail or private
carrier. If these forms of personal notice shall be impracticable, notice may be
communicated by a newspaper of general circulation in the area where published;
or by radio, television or other form of public broadcast communication.
Written notice to shareholders, if in a comprehensible form, shall be
effective when mailed, if mailed postpaid and correctly addressed to the
shareholder's address shown in the corporation's current record of shareholders.
Except as provided above with respect to notice to shareholders, written
notice, if in a comprehensible form, shall be effective at the earliest of the
following:
(1) When received;
(2) Five (5) days after its deposit in the United States mail, as
evidenced by the postmark, if mailed postpaid and correctly addressed;
(3) On the date shown on the return receipt, if sent by registered or
certified mail, return receipt requested, and the receipt is signed by or on
behalf of the addressee.
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<PAGE>
Oral notice shall be effective when communicated if communicated in a
comprehensible manner.
If applicable law prescribes notice requirements for particular
circumstances, those requirements govern. If the articles of incorporation or
these bylaws prescribe notice requirements, not inconsistent with this section
or other provisions of applicable law, those requirements govern.
ARTICLE IX. WAIVER OF NOTICE; ASSENT TO ACTIONS
Unless otherwise provided by law, a shareholder or director of the
corporation may waive any notice required by applicable law, the articles of
incorporation or these bylaws, before or after the date and time stated in the
notice. Except as provided below, the waiver must be in writing, be signed by
the shareholder or director entitled to the notice, and delivered to the
corporation for inclusion in the minutes or filing with the corporate records.
A director's attendance at or participation in a meeting waives any
required notice to him of the meeting unless the director at the beginning of
the meeting (or promptly upon his arrival) objects to holding the meeting or
transacting business at the meeting and does not thereafter vote for or assent
to action taken at the meeting. A shareholder's attendance at a meeting (i)
waives objection to lack of notice or defective notice of the meeting unless the
shareholder at the beginning of the meeting objects to holding the meeting or
transacting business at the meeting, and (ii) waives objection to consideration
of a particular matter at the meeting that is not within the purpose or purposes
described in the meeting notice, unless the shareholder objects to considering
the matter when it is presented.
A director who is present at a meeting of the board of directors or a
committee of the board of directors when corporate action is taken shall be
deemed to have assented to the action taken unless: (1) he objects at the
beginning of the meeting (or promptly upon his arrival) to holding it or
transacting business at the meeting; (2) his dissent or abstention from the
action taken shall be entered in the minutes of the meeting; or (3) he delivers
written notice of his dissent or abstention to the presiding officer of the
meeting before its adjournment or to the corporation immediately after
adjournment of the meeting. The right of dissent or abstention shall not be
available to a director who votes in favor of the action taken.
ARTICLE X. EMERGENCY BYLAWS
The emergency bylaws provided in this article shall be operative during
any emergency in the conduct of the business of the corporation, notwithstanding
any different
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<PAGE>
provision in the preceding articles of the bylaws or in the articles of
incorporation of the corporation or in the Mississippi Business Corporation Act.
An emergency exists if a quorum of the corporation's directors cannot readily be
assembled because of some catastrophic event. To the extent not inconsistent
with the provisions of this article, the bylaws provided in the preceding
articles shall remain in effect during such emergency and upon its termination
the emergency bylaws shall cease to be operative.
During any such emergency:
(a) A meeting of the board of directors may be called by any officer or
director of the corporation. Notice of the meeting shall be given by the officer
or director calling the meeting only to those directors whom it is practicable
to reach and may be given in any practicable manner, including by publication
and radio.
(b) One or more officers of the corporation present at a meeting of the
board of directors may be deemed to be directors for the meeting, in order of
rank and within the same rank in order of seniority, as necessary to achieve a
quorum.
(c) The board of directors, either in anticipation of or during any such
emergency, may modify lines of succession to accommodate the incapacity of any
director, officer, employee or agent.
(d) The board of directors, either in anticipation of or during any such
emergency, may relocate the principal offices or regional offices, or authorize
the officers to do so.
Corporate action taken in good faith during an emergency under this
section to further the ordinary business affairs of the corporation binds the
corporation and may not be used to impose liability on a corporate director,
officer, employee or agent.
These emergency bylaws shall be subject to repeal or change by further
action of the board of directors or by action of the shareholders, but no such
repeal or change shall modify the provisions of the next preceding paragraph
with regard to action taken prior to the time of such repeal or change. Any
amendment of these emergency bylaws may make any further or different provision
that may be practical and necessary for the circumstances of the emergency.
ARTICLE XI. DISTRIBUTIONS
The board of directors may authorize and the corporation may make
distributions to its shareholders, subject to restriction by the articles of
incorporation and applicable law.
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<PAGE>
ARTICLE XII. CORPORATE SEAL
The board of directors shall provide a corporate seal which shall be
circular in form and shall have inscribed thereon the name of the corporation
and the state of incorporation and the words "Corporate Seal".
ARTICLE XIII. AMENDMENTS
Unless the articles of incorporation, applicable law or a resolution of
the shareholders reserves this power exclusively to the shareholders in whole or
part, the corporation's board of directors may amend or repeal these bylaws and
adopt new bylaws at any regular or special meeting of the board of directors.
ACCEPTED THIS ____ day of _______________, 1996.
By: ___________________________________________
TITLE:
21
<PAGE>
EXHIBIT 5.1
Dechert Price & Rhoads
30 Rockefeller Plaza
New York, New York 10112
November 6, 1997
Jitney-Jungle Stores of America, Inc.
1770 Ellis Avenue, Suite 200
Jackson, Mississippi 39204
JITNEY-JUNGLE STORES OF AMERICA, INC.
10 3/8% SENIOR SUBORDINATED NOTES DUE 2007
Dear Sirs:
We have acted as counsel for Jitney-Jungle Stores of America, Inc.,
a Mississippi corporation (the "Issuer"), and the subsidiaries of the Issuer
listed on Schedule A hereto (the "Guarantors") in connection with the filing by
the Issuer and the Guarantors of a Registration Statement on Form S-4,
Registration No. 333-38957 (the "Registration Statement"), with the Securities
and Exchange Commission for the purpose of registering up to $200 million
aggregate principal amount of the Issuer's 10 3/8% Senior Subordinated Notes Due
2007 (the "New Notes") under the Securities Act of 1933, as amended (the "Act").
The New Notes are to be issued in exchange for an equal aggregate principal
amount of the Issuer's outstanding 10 3/8% Senior Subordinated Notes due 2007
(the "Existing Notes") pursuant to the Registration Rights Agreement among the
Issuer, the Guarantors and Donaldson, Lufkin & Jenrette Securities Corporation
and Credit Suisse First Boston filed as Exhibit 4.2 to the Registration
Statement. The New Notes are to be guaranteed on a senior subordinated basis
(the "Guarantees") by each of the Guarantors and are to be issued pursuant to
the terms of the indenture (the "Indenture") among the Issuer, the Guarantors
and Marine Midland Bank, as trustee (the "Trustee"), filed as Exhibit 4.1 to the
Registration Statement. The Indenture is to be qualified under the Trust
Indenture Act of 1939, as amended (the "TIA").
<PAGE>
Jitney-Jungle Stores of America, Inc.
November 6, 1997
Page 2
In connection with the foregoing, we have reviewed such records,
documents, agreements and certificates, and examined such questions of law, as
we have considered necessary or appropriate for the purpose of this opinion. In
making our examination of records, documents, agreements and certificates, we
have assumed the authenticity of the same, the correctness of the information
contained therein, the genuineness of all signatures, the authority of all
persons entering and maintaining records or executing documents, agreements and
certificates (other than persons executing documents, agreements and
certificates on behalf of the Issuer and the Guarantors), and the conformity to
authentic originals of all items submitted to us as copies (whether certified,
conformed, photostatic or by other electronic means) of records, documents,
agreements or certificates. In rendering our opinion, we have relied as to
factual matters upon certificates of public officials and certificates and
representations of officers of the Issuer and the Guarantors.
We have assumed that the Indenture has been duly authorized,
executed and delivered by the Trustee and constitutes a legal, valid and binding
agreement of the Trustee. In addition, we have assumed that there will be no
changes in applicable law between the date of this opinion and the date of
issuance and delivery of the New Notes.
Based upon the foregoing and having regard for such legal
considerations as we deem relevant, we are of the opinion that:
1. The New Notes have been duly authorized by the Issuer and, when
the Registration Statement has been declared effective, when the Indenture has
been duly qualified under the TIA, when the New Notes have been duly executed by
the Issuer and when the New Notes have been duly authenticated by the Trustee in
accordance with the terms of the Indenture and issued and delivered against
exchange of the Existing Notes in accordance with the terms set forth in the
prospectus which is included in the Registration Statement, the New Notes will
be valid and binding obligations of the Issuer.
2. The Guarantees have been duly authorized by each of the
Guarantors and, when the Registration Statement has been declared effective,
when the Indenture has been duly qualified under the TIA, when the New Notes
have been duly executed by the Issuer, when the notation of the Guarantees on
the New Notes has been duly endorsed by each Guarantor and when the New Notes
have been duly authenticated by the Trustee in accordance with the terms of the
Indenture and issued and delivered against exchange of the Existing Notes in
accordance with the terms set forth in the prospectus which is included in the
Registration Statement, the Guarantees will be valid and binding obligations of
the Guarantors.
<PAGE>
Jitney-Jungle Stores of America, Inc.
November 6, 1997
Page 3
Our opinion is subject to: (i) the effect of applicable bankruptcy,
reorganization, insolvency, moratorium, arrangement and other laws affecting
creditors' rights, including, without limitation, the effect of statutory or
other laws regarding fraudulent conveyances, fraudulent transfers and
preferential transfers and (ii) limitations imposed by general principles of
equity (regardless of whether considered in a proceeding at law or in equity).
This opinion is rendered to the Issuer in connection with the filing
of the Registration Statement and for no other purpose. We are members of the
Bar of the State of New York, and except as contemplated by the next succeeding
sentence we express no opinion as to the laws of any jurisdiction other than the
laws of the United States of America and the State of New York. In rendering the
opinions set forth above as to the due authorization of the New Notes and the
Guarantees , we have relied, with your approval, upon the opinions of Butler,
Snow, O'Mara, Stevens & Cannada, PLLC; Hand Arendall, L.L.C.; Maynard, Cooper &
Gale, P.C.; and Liskow & Lewis. Copies of all such opinions are attached hereto.
We hereby consent to the filing of this opinion as Exhibit 5.1 to
the Registration Statement and to the use of our name under the caption "Legal
Matters" in the prospectus which is included in the Registration Statement. In
giving the foregoing consent, we do not admit that we come within the category
of persons whose consent is required by the Act or the rules and regulations
promulgated thereunder.
Very truly yours,
/s/ DECHERT PRICE & RHOADS
<PAGE>
Jitney-Jungle Stores of America, Inc.
November 6, 1997
Page 4
SCHEDULE A
GUARANTOR JURISDICTION OF INCORPORATION
Southern Jitney Jungle Company Mississippi
McCarty-Holman Co., Inc. Mississippi
Interstate Jitney-Jungle Stores, Inc. Alabama
Pump and Save, Inc. Mississippi
Jitney-Jungle Bakery, Inc. Mississippi
Delchamps, Inc. Alabama
Supermarket Cigarette Sales, Inc. Louisiana
<PAGE>
Butler, Snow, O'Mara, Stevens & Cannada
Deposit Guaranty Plaza
210 East Capitol Street, 17th Floor
Jackson, MS 39201
November 6, 1997
Writer's Direct Number
(601) 949-4513
Jitney-Jungle Stores of America, Inc.
1770 Ellis Avenue, Suite 200
Jackson, Mississippi 39204
Dechert Price & Rhoads
30 Rockefeller Plaza
New York, New York 10112
JITNEY-JUNGLE STORES OF AMERICA, INC.
10 3/8% SENIOR SUBORDINATED NOTES DUE 2007
Dear Sirs:
We have acted as local counsel for Jitney-Jungle Stores of America,
Inc., a Mississippi corporation (the "Issuer"), and the subsidiaries of the
Issuer listed on Schedule A hereto (the "Guarantors") in connection with the
filing by the Issuer, the Guarantors and certain other subsidiaries of the
Issuer (the "Other Guarantors") of a Registration Statement on Form S-4,
Registration No. 333-38957 (the "Registration Statement"), with the Securities
and Exchange Commission for the purpose of registering up to $200 million
aggregate principal amount of the Issuer's 10 3/8% Senior Subordinated Notes Due
2007 (the "New Notes") under the Securities Act of 1933, as amended (the "Act").
The New Notes are to be issued in exchange for an equal aggregate principal
amount of the Issuer's outstanding 10 3/8% Senior Subordinated Notes due 2007
(the "Existing Notes") pursuant to the Registration Rights Agreement among the
Issuer, the Guarantors, the Other Guarantors and Donaldson, Lufkin & Jenrette
Securities Corporation and Credit Suisse First Boston filed as Exhibit 4.2 to
the Registration Statement. The New Notes are to be guaranteed on a senior
subordinated basis (the "Guarantees") by each of the Guarantors and the Other
Guarantors and are to be issued pursuant to the terms of the indenture (the
"Indenture") among the Issuer, the Guarantors, the Other Guarantors and Marine
Midland Bank, as trustee (the "Trustee"), filed as Exhibit 4.1 to the
Registration Statement. The Indenture is to be qualified under the Trust
Indenture Act of 1939, as amended (the "TIA").
<PAGE>
In connection with the foregoing, we have reviewed such records,
documents, agreements and certificates, and examined such questions of law, as
we have considered necessary or appropriate for the purpose of this opinion. In
making our examination of records, documents, agreements and certificates, we
have assumed the authenticity of the same, the correctness of the information
contained therein, the genuineness of all signatures, the authority of all
persons entering and maintaining records or executing documents, agreements and
certificates (other than persons executing documents, agreements and
certificates on behalf of the Issuer and the Guarantors), and the conformity to
authentic originals of all items submitted to us as copies (whether certified,
conformed, photostatic or by other electronic means) of records, documents,
agreements or certificates. In rendering our opinion, we have relied as to
factual matters upon certificates of public officials and certificates and
representations of officers of the Issuer and the Guarantors.
Based upon the foregoing and having regard for such legal
considerations as we deem relevant, we are of the opinion that (i) the New Notes
have been duly authorized by the Issuer, and (ii) the Guarantees have been duly
authorized by each of the Guarantors.
This opinion is rendered to the Issuer and to Dechert Price & Rhoads
in connection with the filing of the Registration Statement and for no other
purpose. We are members of the Bar of the State of Mississippi, and we express
no opinion as to the laws of any jurisdiction other than the laws of the State
of Mississippi.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
BUTLER, SNOW, O'MARA, STEVENS & CANNADA, PLLC
/s/ BUTLER, SNOW, O'MARA, STEVENS & CANNADA
<PAGE>
SCHEDULE A
GUARANTOR JURISDICTION OF INCORPORATION
Southern Jitney Jungle Company Mississippi
McCarty-Holman Co., Inc. Mississippi
Pump and Save, Inc. Mississippi
Jitney-Jungle Bakery, Inc. Mississippi
<PAGE>
Liskow & Lewis
One Shell Square
New Orleans, Louisiana 70139
November 6, 1997
Jitney-Jungle Stores of America, Inc.
1770 Ellis Avenue, Suite 200
Jackson, Mississippi 39204
Dechert Price & Rhoads
30 Rockefeller Plaza
New York, New York 10112
Re: Jitney-Jungle Stores of America, Inc.
10 3/8% Senior Subordinated Notes due 2007
Dear Sirs:
We have acted as special Louisiana counsel to Jitney-Jungle Stores
of America, Inc., a Mississippi corporation (the "Issuer"), and the subsidiary
of the Issuer listed on Schedule A hereto (the "Guarantor") in connection with
the filing by the Issuer, the Guarantor and certain other subsidiaries of the
Issuer (the "Other Guarantors") of a Registration Statement on Form S-4,
Registration No. 333-38957 (the "Registration Statement"), with the Securities
and Exchange Commission for the purpose of registering up to $200 million
aggregate principal amount of the Issuer's 10 3/8% Senior Subordinated Notes Due
2007 (the "New Notes") under the Securities Act of 1933, as amended (the "Act").
We have been advised that the New Notes are to be issued in exchange for an
equal aggregate principal amount of the Issuer's outstanding 10 3/8% Senior
Subordinated Notes due 2007 (the "Existing Notes") pursuant to the Registration
Rights Agreement among the Issuer, the Guarantor, the Other Guarantors and
Donaldson, Lufkin & Jenrette Securities Corporation and Credit Suisse First
Boston filed as Exhibit 4.2 to the Registration Statement. We have further been
advised that the New Notes are to be guaranteed on a senior subordinated basis
(the "Guarantee") by the Guarantor and the Other Guarantors and are to be issued
pursuant to the terms of the indenture (the "Indenture") among the Issuer, the
Guarantor, the Other Guarantors and Marine Midland Bank, as trustee (the
"Trustee"), filed as Exhibit 4.1 to the Registration Statement and that the
Indenture is to be qualified under the Trust Indenture Act of 1939, as amended
(the "TIA").
In connection with the foregoing, we have reviewed copies of the
following documents (the "Examined Documents"):
(a) A certified copy of the Articles of Incorporation of Guarantor
and all amendments thereto, issued by the Secretary of State of Louisiana, dated
September 11, 1997 (the "Articles of Incorporation");
<PAGE>
(b) A copy of the By-Laws of Guarantor, certified by the Secretary
of Guarantor in a certificate dated September 15, 1997 (the "By-Laws");
(c) Certificate of Existence issued by the Secretary of State of
Louisiana regarding the corporate existence of Guarantor, dated September 18,
1997;
(d) A Certificate of Good Standing issued by the Secretary of State
of Louisiana with respect to Guarantor, dated September 11, 1997; and
(e) Certified Resolutions of Guarantor, dated November 6, 1997 (the
"Resolutions").
In making our examination of the Examined Documents, we have assumed
the authenticity of the same, the correctness of the information contained
therein, the genuineness of all signatures, the authority of all persons
entering and maintaining records or executing the Examined Documents, and the
conformity to authentic originals of all items submitted to us as copies
(whether certified, conformed, photostatic or by other electronic means).
We have represented Guarantor only in connection with the rendering
of this opinion and our opinion dated September 11, 1997 and have not otherwise
represented Guarantor.
Based solely upon such examination and subject to the foregoing and
other limitations set forth herein, we are of the opinion that the Guarantee has
been duly authorized by the Guarantor.
In addition to the qualifications and assumptions set forth above,
the foregoing opinion is subject to the following qualifications and
assumptions:
A. We have assumed that the Guarantee is substantially identical
to the Senior Subordinated Note Subsidiary Guarantee (as defined in the
Resolutions).
B. We have assumed the legal capacity of natural persons.
C. The opinions expressed herein represent the judgment of this law
firm as to certain legal matters, but they are not guaranties or warranties and
should not be construed as such. By rendering our opinion, we do not undertake
to update or supplement this opinion to reflect any facts or circumstances that
may hereafter come to our attention or any changes in laws that may hereafter
occur.
This opinion is rendered to the Issuer and to Dechert Price & Rhoads
in connection with the filing of the Registration Statement and for no other
purpose. We are members of the Bar of the State of Louisiana, and we express no
opinion as to the laws of any jurisdiction other than the laws of the State of
Louisiana.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ LISKOW & LEWIS
Liskow & Lewis,
A Professional Law Corporation
<PAGE>
SCHEDULE A
GUARANTOR JURISDICTION OF INCORPORATION
Supermarket Cigarette Sales, Inc. Louisiana
<PAGE>
Maynard, Cooper & Gale, P.C.
1901 Sixth Avenue North
Suite 2400 AmSouth/Halbert Plaza
Birmingham, Alabama 35203
November 6, 1997
Jitney-Jungle Stores of America, Inc.
1770 Ellis Avenue, Suite 200
Jackson, Mississippi 39204
Dechert Price & Rhoads
30 Rockefeller Plaza
New York, New York 10112
JITNEY-JUNGLE STORES OF AMERICA, INC.
10 3/8% SENIOR SUBORDINATED NOTES DUE 2007
Dear Sirs:
We have acted as local Alabama counsel for Jitney-Jungle Stores of
America, Inc., a Mississippi corporation (the "Issuer"), and the subsidiary of
the Issuer listed on Schedule A hereto (the "Guarantor") in connection with the
filing by the Issuer, the Guarantor and certain other subsidiaries of the Issuer
(the "Other Guarantors") of a Registration Statement on Form S-4, Registration
No. 333-38957 (the "Registration Statement"), with the Securities and Exchange
Commission for the purpose of registering up to $200 million aggregate principal
amount of the Issuer's 10 3/8% Senior Subordinated Notes Due 2007 (the "New
Notes") under the Securities Act of 1933, as amended (the "Act"). The New Notes
are to be issued in exchange for an equal aggregate principal amount of the
Issuer's outstanding 10 3/8% Senior Subordinated Notes due 2007 (the "Existing
Notes") pursuant to the Registration Rights Agreement among the Issuer, the
Guarantor, the Other Guarantors and Donaldson, Lufkin & Jenrette Securities
Corporation and Credit Suisse First Boston filed as Exhibit 4.2 to the
Registration Statement. The New Notes are to be guaranteed on a senior
subordinated basis (the "Guarantees") by the Guarantor and the Other Guarantors
and are to be issued pursuant to the terms of the indenture (the "Indenture")
among the Issuer, the Guarantor, the Other Guarantors and marine Midland Bank,
as trustee (the "Trustee"), filed as Exhibit 4.1 to the Registration Statement.
The Indenture is to be qualified under the Trust Indenture Act of 1939, as
amended (the "TIA").
In connection with the foregoing, we have reviewed such records,
documents, agreements and certificates, and examined such questions of law, as
we have considered necessary or appropriate for the purpose of this opinion. In
making our examination of records, documents, agreements and certificates, we
have assumed the authenticity of the same, the correctness of the information
contained therein, the genuineness of all signatures, the
<PAGE>
authority of all persons entering and maintaining records or executing
documents, agreements and certificates (other than persons executing documents,
agreements and certificates on behalf of the Guarantor), and the conformity to
authentic originals of all items submitted to us as copies (whether certified,
conformed, photostatic or by other electronic means) of records, documents,
agreements or certificates. In rendering our opinion, we have relied as to
factual matters upon certificates of public officials and certificates and
representations of officers of the Guarantor.
Based upon the foregoing and having regard for such legal
considerations as we deem relevant, we are of the opinion that the Guarantee has
been duly authorized by the Guarantor.
This opinion is rendered to the Issuer and to Dechert Price & Rhoads
in connection with the filing of the Registration Statement and for no other
purpose. We are members of the Bar of the State of Alabama, and we express no
opinion as to the laws of any jurisdiction other than the laws of the State of
Alabama.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
MAYNARD, COOPER & GALE, P.C.
By: /s/ J. Michael Savage
---------------------------
<PAGE>
SCHEDULE A
GUARANTOR JURISDICTION OF INCORPORATION
Interstate Jitney-Jungle Stores, Inc. Alabama
<PAGE>
Hand Arendall, L.L.C.
3000 First National Bank Building
Mobile, Alabama 36601
November 6, 1997
Jitney-Jungle Stores of America, Inc.
1770 Ellis Avenue, Suite 200
Jackson, Mississippi 39204
Dechert Price & Rhoads
30 Rockefeller Plaza
New York, New York 10112
Ladies and Gentlemen:
In furtherance of our representation as special Alabama counsel to
Delchamps, Inc., an Alabama corporation ("Delchamps"), in connection with that
certain Purchase Agreement dated as of September 10, 1997, among Delchamps,
Jitney-Jungle Stores of America, Inc., Southern Jitney-Jungle Company,
McCarty-Holman Co., Inc., Pump and Save, Inc., Donaldson, Lufkin & Jenrette
Securities Corporation and Credit Suisse First Boston, we have been asked to
render the opinion set forth herein. In such capacity, we have examined copies,
certified or otherwise identified to our satisfaction, of the following
documents:
(a) The Articles of Incorporation and By-Laws of Delchamps, and all
amendments thereto;
(b) Directors' Resolution of Delchamps relating to, among other
things, the execution and delivery of the Guarantee referred to
below;
(c) A certificate of an officer of Delchamps certifying as to each
of the foregoing items and as to certain factual matters; and
(d) A form, as approved in the Directors' Resolution referred to
above, of a Senior Subordinated Note Subsidiary Guarantee (the
"Guarantee") by Delchamps of certain 10 3/8% Senior Subordinated
Notes Due 2007 to be issued by Jitney-Jungle Stores of America, Inc.
(the "New Notes").
In addition to the foregoing we have made such limited examination
of the laws of the State of Alabama as we have deemed necessary to our rendering
the opinion set forth below.
We have not represented Delchamps with respect to any of the
undertakings or transactions pertaining to the Guarantee or the New Notes. We
have not participated in the negotiation or preparation of the Guarantee. We are
not general corporate counsel to Delchamps.
<PAGE>
Accordingly, as to the factual matters forming the basis of this opinion, we
have relied solely upon our examination of the documents listed above in this
opinion as having been examined by us. We have not undertaken any independent
review or investigation to determine the existence or absence of such facts,
and no inference as to our knowledge of such facts should be drawn from the
fact that we are acting as special Alabama counsel for Delchamps. Without
limiting the generality of the foregoing, we have not made any independent
review or investigation of agreements, instruments, orders, judgments, rules
or other regulations or decrees by which Delchamps may be bound or to which it
may be subject, nor have we made any independent investigation as to the
existence of actions, suits, investigations or proceedings, if any, pending or
threatened against Delchamps.
We have assumed, with your permission, the legal capacity of natural
persons, the genuineness of signatures, the authenticity of all documents
submitted to us as originals, and the conformity to original documents of all
documents submitted to us as copies and the authenticity of the originals of
such copied documents.
Based solely upon such examination and subject to the foregoing and
the other limitations set forth herein, it is our opinion that the Guarantee has
been duly authorized by Delchamps.
This opinion is rendered to Jitney-Jungle Stores of America, Inc.
and to Dechert Price & Rhoads in connection with the filing of a Registration
Statement on Form S-4 pertaining to the New Notes and for no other purpose. We
hereby consent to the filing of this opinion as an exhibit to such Registration
Statement.
Very truly yours,
HAND ARENDALL, L.L.C.
By: /s/ Preston Bolt
----------------------
<PAGE>
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the use in this Amendment No. 1 to Registration Statement No.
333-38957 of Jitney-Jungle Stores of America, Inc. of our report dated July 10,
1997, appearing in the Prospectus, which is part of this Registration Statement,
and to the reference to us under the heading "Experts" in such Prospectus.
/s/ Deloitte & Touche LLP
Jackson, Mississippi
November 6, 1997
<PAGE>
EXHIBIT 23.3
INDEPENDENT ACCOUNTANTS' CONSENT
The Board of Directors
Jitney-Jungle Stores of America, Inc.
We consent to the use of our report included herein and to the reference to our
firm under the heading "Experts" in the prospectus.
KPMG Peat Marwick LLP
Atlanta, Georgia
November 7, 1997
<PAGE>
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON DECEMBER
10, 1997, UNLESS EXTENDED (THE "EXPIRATION DATE"). TENDERS OF EXISTING NOTES
MAY BE WITHDRAWN AT ANY TIME PRIOR TO 5:00 P.M. ON THE EXPIRATION DATE
JITNEY-JUNGLE STORES OF AMERICA, INC.
LETTER OF TRANSMITTAL
10 3/8% SENIOR SUBORDINATED NOTES DUE 2007
TO: MARINE MIDLAND BANK,
THE EXCHANGE AGENT
<TABLE>
<S> <C>
BY MAIL, OVERNIGHT COURIER OR HAND: BY FACSIMILE:
Marine Midland Bank (212) 658-2292
140 Broadway, Level A CONFIRM BY TELEPHONE:
New York, New York 10005-1180 (212) 658-5931
Attention: Corporate Trust Operations
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN THE ONE
LISTED ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. THE INSTRUCTIONS
ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY
BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
HOLDERS WHO WISH TO BE ELIGIBLE TO RECEIVE NEW NOTES FOR THEIR EXISTING NOTES
PURSUANT TO THE EXCHANGE OFFER MUST VALIDLY TENDER (AND NOT WITHDRAW) THEIR
EXISTING NOTES TO THE EXCHANGE AGENT PRIOR TO THE EXPIRATION DATE.
The undersigned acknowledges receipt of the Prospectus dated November 7,
1997 (the "Prospectus") of JITNEY-JUNGLE STORES OF AMERICA, INC. (the "Company")
and this Letter of Transmittal (the "Letter of Transmittal"), which together
constitute the Company's Offer to Exchange (the "Exchange Offer") $1,000
principal amount of its 10 3/8% Senior Subordinated Notes due 2007 (the "New
Notes"), which have been registered under the Securities Act of 1933, as amended
(the "Securities Act"), pursuant to a Registration Statement of which the
Prospectus is a part, for each $1,000 principal amount of its outstanding
10 3/8% Senior Subordinated Notes due 2007 (the "Existing Notes"), of which
$200,000,000 principal amount is outstanding, upon the terms and conditions set
forth in the Prospectus. Other capitalized terms used but not defined herein
have the meaning given to them in the Prospectus.
For each Existing Note accepted for exchange, the holder of such Existing
Note will receive a New Note having a principal amount equal to that of the
surrendered Existing Note. Interest on the New Notes will accrue from the last
interest payment date on which interest was paid on the Existing Notes
surrendered in exchange therefor or, if no interest has been paid on the
Existing Notes, from the date of original issue of the Existing Notes. Holders
of Existing Notes accepted for exchange will be deemed to have waived the right
to receive any other payments or accrued interest on the Existing Notes. The
Company reserves the right, at any time or from time to time, to extend the
Exchange Offer at its discretion, in which event the term "Expiration Date"
shall mean the latest time and date to which the Exchange Offer is extended. The
Company shall notify holders of the Existing Notes of any extension by means of
a press release or other public announcement prior to 9:00 A.M., New York City
time, on the next business day after the previously scheduled Expiration Date.
<PAGE>
This Letter of Transmittal is to be used by Holders if: (i) certificates
representing Existing Notes are to be physically delivered to the Exchange Agent
herewith by Holders; (ii) tender of Existing Notes is to be made by book-entry
transfer to the Exchange Agent's account at The Depository Trust Company
("DTC"), pursuant to the procedures set forth in the Prospectus under "The
Exchange Offer -- Procedures for Tendering Existing Notes" by any financial
institution that is a participant in DTC and whose name appears on a security
position listing as the owner of Existing Notes or (iii) tender of Existing
Notes is to be made according to the guaranteed delivery procedures set forth in
the prospectus under "The Exchange Offer -- Guaranteed Delivery Procedures."
DELIVERY OF DOCUMENTS TO DTC DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
The term "Holder" with respect to the Exchange Offer means any person: (i)
in whose name Existing Notes are registered on the books of the Company or any
other person who has obtained a properly completed bond power from the
registered Holder; or (ii) whose Existing Notes are held of record by DTC who
desires to deliver such Existing Notes by book-entry transfer at DTC. The
undersigned has completed, executed and delivered this Letter of Transmittal to
indicate the action the undersigned desires to take with respect to the Exchange
Offer.
The instructions included with this Letter of Transmittal must be followed.
Questions and requests for assistance or for additional copies of the
Prospectus, this Letter of Transmittal and the Notice of Guaranteed Delivery may
be directed to the Exchange Agent. See Instruction 11 herein.
<PAGE>
HOLDERS WHO WISH TO ACCEPT THE EXCHANGE OFFER
AND TENDER THEIR EXISTING NOTES MUST COMPLETE THIS
LETTER OF TRANSMITTAL IN ITS ENTIRETY.
PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL
CAREFULLY BEFORE CHECKING ANY BOX BELOW
<TABLE>
<S> <C> <C> <C>
DESCRIPTION OF 10 3/8% SENIOR SUBORDINATED NOTES DUE 2007 (EXISTING NOTES)
<CAPTION>
AGGREGATE
NAME(S) AND ADDRESS(ES) OF PRINCIPAL PRINCIPAL AMOUNT
REGISTERED HOLDER(S) CERTIFICATE AMOUNT REPRESENTED TENDERED (IF LESS
(PLEASE FILL IN, IF BLANK) NUMBER(S)* BY CERTIFICATE(S) THAN ALL)**
<S> <C> <C> <C>
* Need not be completed by Holders tendering by book-entry transfer.
** Unless indicated in the column labeled "Principal Amount Tendered," any tendering Holder
of Existing Notes will be deemed to have tendered the entire aggregate principal amount
represented by the column labeled "Aggregate Principal Amount Represented by
Certificate(s)." If the space provided above is inadequate, list the certificate numbers
and principal amounts on a separate signed schedule and affix the list to this Letter of
Transmittal.
</TABLE>
The minimum permitted tender is $1,000 in principal amount of Existing
Notes. All other tenders must be integral multiples of $1,000.
<TABLE>
<S> <C>
SPECIAL ISSUANCE INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4, 5, AND 6) (SEE INSTRUCTIONS 4, 5 AND 6)
To be completed ONLY if certificates To be completed ONLY if certificates for
for Existing Notes in a principal amount Existing Notes in a principal amount not
not tendered or not accepted for exchange, tendered or not accepted for exchange, are
or New Notes issued in exchange for to be sent to someone other than the
Existing Notes accepted for exchange, are undersigned, or to the undersigned at an
to be issued in the name of someone other address other than that shown above.
than the undersigned, or if the Existing Mail to:
Notes tendered by book-entry transfer that Name:
are not accepted for exchange are to be
credited to an account maintained by DTC.
Issue certificate(s) to:
Name: Address:
Address:
(INCLUDE ZIP CODE) (INCLUDE ZIP CODE)
(TAXPAYER IDENTIFICATION OR (TAXPAYER IDENTIFICATION OR
SOCIAL SECURITY NO.) SOCIAL SECURITY NO.)
</TABLE>
<PAGE>
<TABLE>
<S> <C>
/ / CHECK HERE IF TENDERED EXISTING NOTES ARE BEING DELIVERED BY BOOK- ENTRY TRANSFER TO THE
EXCHANGE AGENTS ACCOUNT AT DTC AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:
DTC Book-Entry Account No.:
Transaction Code No.:
/ / CHECK HERE IF TENDERED EXISTING NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE THE FOLLOWING:
Name(s) of Registered Holder(s):
Window Ticket Number (if any):
Date of Execution of Notice of Guaranteed Delivery:
IF DELIVERED BY BOOK-ENTRY TRANSFER: COMPLETE THE FOLLOWING:
Account Number: Transaction Code Number:
/ / CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE
PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.
Name:
Address:
/ / CHECK HERE IF YOU ARE A BROKER-DEALER AND ARE RECEIVING NEW NOTES FOR YOUR OWN ACCOUNT
IN EXCHANGE FOR EXISTING NOTES THAT WERE ACQUIRED AS A RESULT OF MARKET MAKING
ACTIVITIES OR OTHER TRADING ACTIVITIES.
Name:
Address:
</TABLE>
LADIES AND GENTLEMEN:
Subject to the terms and conditions of the Exchange Offer, the undersigned
hereby tenders to the Company the principal amount of Existing Notes indicated
above. Subject to and effective upon the acceptance for exchange of the
principal amount of Existing Notes tendered in accordance with this Letter of
Transmittal, the undersigned sells, assigns and transfers to, or upon the order
of, the Company all right, title and interest in and to the Existing Notes
tendered hereby. The undersigned hereby irrevocably constitutes and appoints the
Exchange Agent its agent and attorney-in-fact (with full knowledge that the
Exchange Agent also acts as the agent of the Company and as Trustee under the
indenture for the Existing Notes and New Notes) with respect to the tendered
Existing Notes with full power of substitution to (i) deliver certificates for
such Existing Notes to the Company, or transfer ownership of such Existing Notes
on the account books maintained by DTC and deliver all accompanying evidence of
transfer and authenticity to, or upon the order of, the Company and (ii) present
such Existing Notes for transfer on the books of the Company and receive all
benefits and otherwise exercise all rights of beneficial ownership of such
Existing Notes, all in accordance with the terms and subject to the conditions
of the Exchange Offer. The power of attorney granted in this paragraph shall be
deemed irrevocable and coupled with an interest.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the Existing Notes
tendered hereby and that the Company will acquire good and unencumbered title
thereto, free and clear of all liens, restrictions, charges and encumbrances and
not subject to any adverse claim, when the same are acquired by the Company. The
undersigned
<PAGE>
hereby further represents that any New Notes acquired in exchange for Existing
Notes tendered hereby will have been acquired in the ordinary course of business
of the Holder receiving such New Notes, whether or not such person is the
Holder, that neither the Holder nor any such other person has any arrangement or
understanding with any person to participate in the distribution of such New
Notes and that neither the Holder nor any such other person is an "affiliate,"
as defined in Rule 405 under the Securities Act, of the Company or any of its
subsidiaries.
The undersigned also acknowledges that this Exchange Offer is being made in
reliance on an interpretation by the staff of the Securities and Exchange
Commission (the "SEC") that the New Notes issued in exchange for the Existing
Notes pursuant to the Exchange Offer may be offered for resale, resold and
otherwise transferred by holders thereof (other than any such holder that is an
"affiliate" of the Company within the meaning of Rule 405 under the Securities
Act), without compliance with the registration and prospectus delivery
provisions of the Securities Act, provided that such New Notes are acquired in
the ordinary course of such holders' business and such holders have no
arrangements with any person to participate in the distribution of such New
Notes. If the undersigned is not a broker-dealer, the undersigned represents
that it is not engaged in, and does not intend to engage in, a distribution of
New Notes. If the undersigned is a broker-dealer that will receive New Notes for
its own account in exchange for Existing Notes that were acquired as a result of
market-making activities or other trading activities, it acknowledges that it
will deliver a prospectus in connection with any resale of such New Notes;
however, by so acknowledging and by delivering a prospectus, the undersigned
will not be deemed to admit that it is an "underwriter" within the meaning of
the Securities Act.
The undersigned will, upon request, execute and deliver any additional
documents deemed by the Exchange Agent or the Company to be necessary or
desirable to complete the assignment, transfer and purchase of the Existing
Notes tendered hereby. All authority conferred or agreed to be conferred by this
Letter of Transmittal shall survive the death, incapacity or dissolution of the
undersigned and every obligation of the undersigned under this Letter of
Transmittal shall be binding upon the undersigned's heirs, personal
representatives, successors and assigns, trustees in bankruptcy or other legal
representatives of the undersigned. This tender may be withdrawn only in
accordance with the procedures set forth in "The Exchange Offer -- Withdrawal
Rights" section of the Prospectus.
For purposes of the Exchange Offer, the Company shall be deemed to have
accepted validly tendered Existing Notes when, as and if the Company has given
oral or written notice thereof to the Exchange Agent.
If any tendered Existing Notes are not accepted for exchange pursuant to the
Exchange Offer for any reason, certificates for any such unaccepted Existing
Notes will be returned (except as noted below with respect to tenders through
DTC), without expense, to the undersigned at the address shown below or at a
different address as may be indicated under Special Delivery Instructions as
promptly as practicable after the Expiration Date.
The undersigned understands that tenders of Existing Notes pursuant to the
procedures described under the caption "The Exchange Offer -- Procedures for
Tendering Existing Notes" in the Prospectus and in the instructions hereto will
constitute a binding agreement between the undersigned and the Company upon the
terms and subject to the conditions of the Exchange Offer.
Unless otherwise indicated under "Special Issuance Instructions," please
issue the certificates representing the New Notes issued in exchange for the
Existing Notes accepted for exchange and return any Existing Notes not tendered
or not exchanged in the name(s) of the undersigned (or in either such event in
the case of the Existing Notes tendered through DTC, by credit to the
undersigned's account, at DTC). Similarly, unless otherwise indicated under
"Special Delivery Instructions," please send the certificates representing the
New Notes issued in exchange for the Existing Notes accepted for exchange and
any certificates for Existing Notes not tendered or not exchanged (and
accompanying documents, as appropriate) to the undersigned at the address shown
below the undersigned's signature(s), unless, in either event, tender is being
made through DTC. In the event that both "Special Issuance Instructions" and
"Special Delivery Instructions" are completed, please issue the certificates
representing the New Notes issued in exchange for the Existing Notes accepted
for exchange and return any Existing Notes not tendered or not
<PAGE>
exchanged in the name(s) of, and send said certificates to, the person(s) so
indicated. The undersigned recognizes that the Company has no obligation
pursuant to the "Special Issuance Instructions" and "Special Delivery
Instructions" to transfer any Existing Notes from the name of the registered
Holder(s) thereof if the Company does not accept for exchange any of the
Existing Notes so tendered.
Holders of Existing Notes who wish to tender their Existing Notes and (i)
whose Existing Notes are not immediately available or (ii) who cannot deliver
their Existing Notes, this Letter of Transmittal or any other documents required
hereby to the Exchange Agent, or cannot complete the procedure for book-entry
transfer, prior to the Expiration Date, may tender their Existing Notes
according to the guaranteed delivery procedures set forth in the Prospectus
under the caption "The Exchange Offer -- Guaranteed Delivery Procedures." See
Instruction 1 regarding the completion of the Letter of Transmittal printed
below.
PLEASE SIGN HERE WHETHER OR NOT
EXISTING NOTES ARE BEING PHYSICALLY TENDERED HEREBY
<TABLE>
<S> <C>
X Date
X
Signature(s) of Registered Holder(s) Date
Or Authorized Signatory
Area Code and Telephone Number
</TABLE>
The above lines must be signed by the registered Holder(s) of Existing Notes
as their name(s) appear(s) on the Existing Notes or, if the Existing Notes are
tendered by a participant in DTC, as such participant's name appears on a
security position listing as the owner of Existing Notes, or by person(s)
authorized to become registered Holder(s) by a properly completed bond power
from the registered Holder(s), a copy of which must be transmitted with this
Letter of Transmittal. If Existing Notes to which this Letter of Transmittal
relates are held of record by two or more joint Holders, then all such holders
must sign this Letter of Transmittal. If signature is by a trustee, executor,
administrator, guardian, attorney-in-fact, officer of a corporation or other
person acting in a fiduciary or representative capacity, such person must (i)
set forth his or her full title below and (ii) unless waived by the Company,
submit evidence satisfactory to the Company of such person's authority to act.
See Instruction 4 regarding the completion of this Letter of Transmittal printed
below.
Name(s): _______________________________________________________________________
(Please Print)
Capacity: ______________________________________________________________________
Address: _______________________________________________________________________
(Include Zip Code)
<TABLE>
<S> <C>
Signature(s) Guaranteed by an Eligible Institution:
(If required by Instruction 4)
(Authorized Signature)
(Title)
(Name of Firm)
Dated:
</TABLE>
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS
OF THE EXCHANGE OFFER
1. DELIVERY OF THIS LETTER AND EXISTING NOTES; GUARANTEED DELIVERY
PROCEDURES. This Letter is to be completed by Holders, either if certificates
are to be forwarded herewith or if tenders are to be made pursuant to the
procedures for delivery by book-entry transfer set forth in "The Exchange Offer
- -- Book-Entry Transfer" section of the Prospectus. Certificates for all
physically tendered Existing Notes, or Book-Entry Confirmation, as the case may
be, as well as a properly completed and duly executed Letter (or manually signed
facsimile hereof) and any other documents required by this Letter, must be
received by the Exchange Agent at the address set forth herein on or prior to
the Expiration Date, or the tendering Holder must comply with the guaranteed
delivery procedures set forth below. Existing Notes tendered hereby must be in
denominations of principal amount of maturity of $1,000 and any integral
multiple thereof.
Holders whose certificates for Existing Notes are not immediately available
or who cannot deliver their certificates and all other required documents to the
Exchange Agent on or prior to the Expiration Date, or who cannot complete the
procedure for book-entry transfer on a timely basis, may tender their Existing
Notes pursuant to the guaranteed delivery procedures set forth in "The Exchange
Offer -- Guaranteed Delivery Procedures" section of the Prospectus. Pursuant to
such procedures, (i) such tender must be made through an Eligible Institution
(as defined in Instruction 4 below), (ii) prior to the Expiration Date, the
Exchange Agent must receive from such Eligible Institution a properly completed
and duly executed Letter (or facsimile thereof) and Notice of Guaranteed
Delivery, substantially in the form provided by the Company (by fascimile
transmission, mail or hand delivery), setting forth the name and address of the
Holder of Existing Notes and the amount of Existing Notes tendered, stating that
the tender is being made thereby and guaranteeing that within five New York
Stock Exchange ("NYSE") trading days after the date of execution of the Notice
of Guaranteed Delivery, the certificates for all physically tendered Existing
Notes, or a Book-Entry Confirmation, and any other documents required by this
Letter will be deposited by the Eligible Institution with the Exchange Agent,
and (iii) the certificates for all physically tendered Existing Notes, in proper
form for transfer, or Book-Entry Confirmation, as the case may be, and all other
documents required by this Letter, are received by the Exchange Agent within
five NYSE trading days after the date of execution of the Notice of Guaranteed
Delivery.
The method of delivery of this Letter, the Existing Notes and all other
required documents is at the election and risk of the tendering Holders, but the
delivery will be deemed made only when actually received or confirmed by the
Exchange Agent. If Existing Notes are sent by mail, it is suggested that the
mailing be made sufficiently in advance of the Expiration Date to permit the
delivery to the Exchange Agent prior to 5:00 p.m., New York City time, on the
Expiration Date.
See "The Exchange Offer" section in the Prospectus.
2. TENDER BY HOLDER. Only a Holder of Existing Notes may tender such
Existing Notes in the Exchange Offer. Any beneficial holder of Existing Notes
who is not the registered Holder and who wishes to tender should arrange with
the registered Holder to execute and deliver this Letter on his or her behalf or
must, prior to completing and executing this Letter and delivering his or her
Existing Notes, either make appropriate arrangements to register ownership of
the Existing Notes in such holder's name or obtain a properly completed bond
power from the registered Holder.
3. PARTIAL TENDERS. Tenders of Existing Notes will be accepted only in
integral multiples of $1,000. If less than the entire principal amount of any
Existing Notes is tendered, the tendering Holder should fill in the principal
amount tendered in the fourth column of the box entitled "Description of 10 3/8%
Senior Subordinated Notes due 2007 (Existing Notes)" above. The entire principal
amount of Existing Notes delivered to the Exchange Agent will be deemed to have
been tendered unless otherwise indicated. If the entire principal amount of all
Existing Notes is not tendered, then Existing Notes for the principal amount
<PAGE>
of Existing Notes not tendered and a certificate or certificates representing
New Notes issued in exchange for any Existing Notes accepted will be sent to the
Holder at his or her registered address, unless a different address is provided
in the appropriate box on this Letter promptly after the Existing Notes are
accepted for exchange.
4. SIGNATURES ON THIS LETTER; POWERS OF ATTORNEY AND ENDORSEMENTS; GUARANTEE
OF SIGNATURES. If this Letter is signed by the registered Holder of the
Existing Notes tendered hereby, the signature must correspond exactly with the
name as written on the face of the certificates without any change whatsover.
If any tendered Existing Notes are owned of record by two or more joint
owners, all such owners must sign this Letter.
If any tendered Existing Notes are registered in different names on several
certificates, it will be necessary to complete, sign and submit as many separate
copies of this Letter as there are different registrations of certificates.
When this Letter is signed by the registered Holder or Holders of the
Existing Notes specified herein and tendered hereby, no endorsements of
certificates or separate powers of attorney are required. If, however, the New
Notes are to be issued, or any untendered Existing Notes are to be reissued, to
a person other than the registered Holder, then endorsements of any certificates
transmitted hereby or separate powers of attorney are required. Signatures on
such certificate(s) must be guaranteed by an Eligible Institution.
If this Letter is signed by a person other than the registered Holder or
Holders of any certificate(s) specified herein, such certificate(s) must be
endorsed or accompanied by appropriate powers of attorney, in either case signed
exactly as the name or names on the registered Holder or Holders appear(s) on
the certificate(s) and signatures on such certificate(s) must be guaranteed by
an Eligible Institution.
If this Letter or any certificates or powers of attorney are signed by
trustees, executors, administrators, guardians, attorneys-in-fact, officers of
corporations or others acting in a fiduciary or representative capacity, such
persons should so indicate when signing, and unless waived by the Company,
proper evidence satisfactory to the Company of their authority to so act must be
submitted.
Endorsements on certificates for Existing Notes or signatures on powers of
attorney required by this Instruction 4 must be guaranteed by a firm which is a
participant in a recognized signature guarantee medallion program (an "Eligible
Institution").
Signatures on this Letter must be guaranteed by an Eligible Institution
unless the Existing Notes are tendered (i) by a registered Holder of Existing
Notes (which term, for purposes of the Exchange Offer, includes any participant
in the Book-Entry Transfer Facility system whose name appears on a security
position listing as the Holder of such Existing Notes) who has not completed the
box entitled "Special Issuance Instructions" or "Special Delivery Instructions"
on this Letter, or (ii) for the account of an Eligible Institution.
5. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. Tendering Holders should
indicate, in the applicable box or boxes, the name and address to which New
Notes or substitute Existing Notes for principal amounts not tendered or not
accepted for exchange are to be issued or sent, if different from the name and
address of the person signing this Letter of Transmittal (or in the case of
tender of Existing Notes through DTC, if different from DTC). In the case of
issuance in a different name, the taxpayer identification or social security
number of the person named must also be indicated. Holders tendering Exisiting
Notes by book-entry transfer may request that Existing Notes not exchanged be
credited to such account maintained at the Book-Entry Transfer Facility as such
Holder may designate hereon. If no such instructions are given, such Existing
Notes not exchanged will be returned to the name and address of the person
signing this Letter.
6. TAX IDENTIFICATION NUMBER. Federal income tax law requires that a Holder
whose offered Existing Notes are accepted for exchange must provide the Company
(as payer ) with his, her or its correct Taxpayer Identification Number ("TIN"),
which, in the case of an exchanging Holder who is an individual, is his or
<PAGE>
her social security number. If the Company is not provided with the correct TIN
or an adequate basis for exemption, such Holder may be subject to a $50 penalty
imposed by the Internal Revenue Service (the "IRS"), and payments made with
respect to Existing Notes purchased pursuant to the Exchange Offer may be
subject to backup withholding at a 31% rate. If withholding results in an
overpayment of taxes, a refund may be obtained. Exempt Holders (including, among
others, all corporations and certain foreign individuals) are not subject to
these backup withholding and reporting requirements. See the enclosed
"Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9."
To prevent backup withholding, each exchanging Holder must provide his, her
or its correct TIN by completing the Substitute Form W-9 enclosed herewith,
certifying that the TIN provided is correct (or that such Holder is awaiting a
TIN) and that (i) the Holder is exempt from backup withholding, (ii) the Holder
has been notified by the IRS that he, she or it is subject to backup withholding
as a result of a failure to report all interest or dividends, or (iii) the IRS
has notified the Holder that he, she or it is no longer subject to backup
withholding. In order to satisfy the Exchange Agent that a foreign individual
qualifies as an exempt recipient, such Holder must submit a statement signed
under penalty of perjury attesting to such exempt status. Such statements may be
obtained from the Exchange Agent. If the Existing Notes are in more than one
name or are not in the name of the actual owner, consult the substitute Form W-9
for information on which TIN to report. If you do not provide your TIN to the
Company within 60 days, backup withholding will begin and continue until you
furnish your TIN to the Company.
7. TRANSFER TAXES. The Company will pay all transfer taxes, if any,
applicable to the exchange of Existing Notes pursuant to the Exchange Offer. If,
however, certificates representing New Notes or Existing Notes for principal
amounts not tendered or accepted for exchange are to be delivered to, or are to
be registered or issued in the name of, any person other than the registered
Holder of the Existing Notes tendered hereby, or if tendered Existing Notes are
registered in the name of any person other than the person signing this Letter,
or if a transfer tax is imposed for any reason other than the exchange of
Existing Notes pursuant to the Exchange Offer, then the amount of any such
transfer taxes (whether imposed on the registered Holder or on any other
persons) will be payable by the tendering Holder. If satisfactory evidence of
payment of such taxes or exemption therefrom is not submitted herewith, the
amount of such transfer taxes will be billed directly to such tendering Holder.
Except as provided in this Instruction 7, it will not be necessary for
transfer tax stamps to be affixed to the Existing Notes listed in this Letter.
8. WAIVER OF CONDITIONS. The Company reserves the absolute right to amend,
waive or modify specified conditions in the Exchange Offer in the case of any
Existing Notes tendered.
9. NO CONDITIONAL TRANSFERS. No alternative, conditional, irregular or
contingent tenders will be accepted. All tendering Holders of Existing Notes, by
execution of this Letter, shall waive any right to receive notice of the
acceptance of their Existing Notes for exchange.
Neither the Company, the Exchange Agent nor any other person is obligated to
give notice of any defect or irregularity with respect to any tender of Existing
Notes nor shall any of them incur any liability for failure to give any such
notice.
10. MUTILATED, LOST, STOLEN OR DESTROYED EXISTING NOTES. Any tendering
Holder whose Existing Notes have been mutilated, lost, stolen or destroyed
should contact the Exchange Agent at the address indicated herein for further
instructions.
11. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions and requests
for assistance for additional copies of the Prospectus, this Letter and the
Notice of Guaranteed Delivery may be directed to the Exchange Agent at the
address specified in the Prospectus.
<PAGE>
(DO NOT WRITE IN THE SPACE BELOW)
ACCOUNT NUMBER: _______________ TRANSACTION CODE NUMBER: ______________
<TABLE>
<CAPTION>
CERTIFICATE EXISTING NOTES EXISTING NOTES
SURRENDERED TENDERED ACCEPTED
- ------------------------------------ ------------------------------------ ------------------------------------
<S> <C> <C>
</TABLE>
Delivery Prepared by
<TABLE>
<S> <C> <C>
Checked by
Date
</TABLE>
<PAGE>
PAYER'S NAME: JITNEY-JUNGLE STORES OF AMERICA, INC.
<TABLE>
<S> <C> <C> <C>
Name (if joint names, list first and circle the name of the
person or entity whose number you enter in Part 1 below. See
instructions if your name has changed.)
SUBSTITUTE
Address
FORM W-9 City, state and ZIP code
List account number(s) here (optional)
DEPARTMENT OF THE
TREASURY
INTERNAL REVENUE SERVICE PART 1--PLEASE PROVIDE YOUR Social security number
TAXPAYER IDENTIFICATION NUMBER or TIN
("TIN") IN THE BOX AT RIGHT AND
CERTIFY BY SIGNING AND DATING
BELOW.
PAYER'S REQUEST FOR TIN
PART 2--Check the box if you are NOT subject to backup
withholding under the provisions of section 3408(a)(1)(C) of the
Internal Revenue Code because (1) you have not been notified that
you are subject to backup withholding as a result of failure to
report all interest or dividends or (2) the Internal Revenue
Service has notified you that you are no longer subject to backup
withholding / /.
CERTIFICATION--UNDER THE PENALTIES OF PERJURY,
I CERTIFY THAT THE INFORMATION PROVIDED ON THIS
FORM IS TRUE, CORRECT AND COMPLETE.
Signature Date PART 3--
AWAITING TIN / /
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE EXCHANGE OFFER. PLEASE
REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER OR SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
<PAGE>
NOTICE OF GUARANTEED DELIVERY
FOR
10 3/8% SENIOR SUBORDINATED NOTES DUE 2007
JITNEY-JUNGLE STORES OF AMERICA, INC.
As set forth in the Prospectus dated November 7, 1997 (the "Prospectus"), of
JITNEY-JUNGLE STORES OF AMERICA, INC., (the "Company") and in the accompanying
Letter of Transmittal and instructions thereto (the "Letter of Transmittal"),
this form or one substantially equivalent hereto must be used to accept the
Company's offer to exchange (the "Exchange Offer") all of its outstanding
10 3/8% Senior Subordinated Notes due 2007 (the "Existing Notes") for its
10 3/8% Senior Subordinated Notes due 2007 which have been registered under the
Securities Act of 1933, as amended, if certificates for the Existing Notes are
not immediately available or if the Existing Notes, the Letter of Transmittal or
any other documents required thereby cannot be delivered to the Exchange Agent,
or the procedure for book-entry transfer cannot be completed prior to 5:00 P.M.,
New York City time, on the Expiration Date (as defined below). This form may be
delivered by an Eligible Institution by hand or transmitted by facsimile
transmission, overnight courier or mail to the Exchange Agent as set forth
below. Capitalized terms used but not defined herein have the meaning given to
them in the Prospectus.
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON WEDNESDAY,
DECEMBER 10, 1997, UNLESS THE OFFER IS EXTENDED (THE "EXPIRATION DATE"). TENDERS
OF EXISTING NOTES MAY BE WITHDRAWN AT ANY TIME PRIOR TO 5:00 P.M. ON THE
EXPIRATION DATE.
<TABLE>
<S> <C>
To: Marine Midland Bank, The Exchange Agent
BY OVERNIGHT COURIER OR HAND: BY FACSIMILE:
Marine Midland Bank (212) 658-2292
140 Broadway, Level A CONFIRM BY TELEPHONE:
New York, New York 10005-1180 (212) 658-5931
Attention: Corporate Trust Operations
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS, OR TRANSMISSION OF INSTRUCTIONS
VIA FACSIMILE, OTHER THAN AS SET FORTH ABOVE, DOES NOT CONSTITUTE A VALID
DELIVERY.
This form is not to be used to guarantee signatures. If a signature on the
Letter of Transmittal to be used to tender Existing Notes is required to be
guaranteed by an "Eligible Institution" under the instructions thereto, such
signature guarantee must appear in the applicable space provided in the Letter
of Transmittal.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to JITNEY-JUNGLE STORES OF AMERICA, INC., a
Mississippi corporation (the "Company"), upon the terms and subject to the
conditions set forth in the Prospectus and the Letter of Transmittal (which
together constitute the "Exchange Offer"), receipt of which is hereby
acknowledged, (number of Existing Notes) Existing Notes pursuant to
the guaranteed delivery procedures set forth in Instruction 1 of the Letter of
Transmittal.
The undersigned understands that tenders of Existing Notes will be accepted
only in principal amounts equal to $1,000 or integral multiples thereof. The
undersigned understands that tenders of Existing Notes pursuant to the Exchange
Offer may not be withdrawn after 5:00 p.m., New York City time, on the
Expiration Date.
All authority herein conferred or agreed to be conferred by this Notice of
Guaranteed Delivery shall survive the death, incapacity or dissolution of the
undersigned and every obligation of the undersigned under this Notice of
Guaranteed Delivery shall be binding upon the heirs, personal representatives,
executors, administrators, successors, assigns, trustees in bankruptcy and other
legal representatives of the undersigned.
NOTE: SIGNATURES MUST BE PROVIDED WHERE INDICATED BELOW.
<TABLE>
<CAPTION>
Certificate No(s). for Existing Notes (if Name(s) of Record Holder(s)
available)
<S> <C>
PLEASE PRINT OR TYPE
Principal Amount of Existing Notes Address
Area code and
Tel. No.
Signature(s)
Dated:
If Existing Notes will be delivered by
book-entry transfer at the Depository Trust
Company, Depository Account No.
</TABLE>
This Notice of Guaranteed Delivery must be signed by the registered
holder(s) of Existing Notes exactly as its (their) name(s) appear on
certificates for Existing Notes or on a security position listing as the owner
of Existing Notes or by person(s) authorized to become registered holder(s) by
endorsements and documents transmitted with this Notice of Guaranteed Delivery.
If signature is by a trustee, executor, administrator, guardian,
attorney-in-fact, officer or other person acting in a fiduciary or
representative capacity, such person must provide the following information:
PLEASE PRINT NAME(S) AND ADDRESS(ES)
Name(s):________________________________________________________________________
Capacity:_______________________________________________________________________
Address(es):____________________________________________________________________
<PAGE>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a member firm of a registered national securities exchange
or of the National Association of Securities Dealers, Inc., or a commercial bank
or trust company having an office or correspondent in the United States or an
"eligible guarantor institution" within the meaning of Rule 17Ad-15 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), hereby (a)
represents that the above named person(s) "own(s)" the Existing Notes tendered
hereby within the meaning of Rule 14e-4 under the Exchange Act, (b) represents
that such tender of Existing Notes complies with Rule 14e-4 under the Exchange
Act, (b) represents that such tender of Existing Notes complies with Rule 14e-4
under the Exchange Act and (c) guarantees that delivery to the Exchange Agent of
certificates for the Existing Notes tendered hereby, in proper form for transfer
(or confirmation of the book-entry transfer of such Existing Notes into the
Exchange Agent's Account at the Depository Trust Company, pursuant to the
procedures for book-entry transfer set forth in the Prospectus), with delivery
of a properly completed and duly executed Letter of Transmittal (or manually
signed facsimile thereof) with any required signatures and any other required
documents, will be received by the Exchange Agent at its address set forth above
within five business days after the Expiration Date.
THE UNDERSIGNED ACKNOWLEDGES THAT IT MUST DELIVER THE LETTER OF TRANSMITTAL
AND EXISTING NOTES TENDERED HEREBY TO THE EXCHANGE AGENT WITHIN THE TIME PERIOD
SET FORTH AND THAT FAILURE TO DO SO COULD RESULT IN FINANCIAL LOSS TO THE
UNDERSIGNED.
<TABLE>
<CAPTION>
Name of Firm
<S> <C>
Authorized Signatures
Address Name
Please Print or Type
Title
Zip Code
Area Code and Tel. No. Date
Dated:, 1997
</TABLE>
NOTE: DO NOT SEND EXISTING NOTES WITH THIS FORM; EXISTING NOTES SHOULD BE SENT
WITH YOUR LETTER OF TRANSMITTAL SO THAT THEY ARE RECEIVED BY THE EXCHANGE AGENT
WITHIN FIVE BUSINESS DAYS AFTER THE EXPIRATION DATE.
