MERKERT AMERICAN CORP, S-1/A, 1998-11-04

MERKERT AMERICAN CORP
S-1/A, 1998-11-04
GROCERIES, GENERAL LINE

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 4, 1998
REGISTRATION STATEMENT NO. 333-53419

- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

---------------

AMENDMENT NO. 4 TO
FORM S-1
REGISTRATION STATEMENT

UNDER
THE SECURITIES ACT OF 1933

---------------
MERKERT AMERICAN CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

DELAWARE 5141-02 04-3411833
(STATE OR OTHER (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
JURISDICTION OF CLASSIFICATION CODE NUMBER) IDENTIFICATION NO.)
INCORPORATION OR
ORGANIZATION)

---------------
490 TURNPIKE STREET
CANTON, MASSACHUSETTS 02021
(781) 828-4800
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICE)

JAMES L. MONROE
PRESIDENT
MERKERT AMERICAN CORPORATION
490 TURNPIKE STREET
CANTON, MASSACHUSETTS 02021
(781) 828-4800
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)

---------------
COPIES TO:

STUART M. CABLE, P.C.
GOODWIN, PROCTER & HOAR LLP
EXCHANGE PLACE
BOSTON, MASSACHUSETTS 02109-2881
(617) 570-1000

---------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [_]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act Registration Statement number of the earlier
effective Registration Statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
Registration Statement number of the earlier effective Registration Statement
for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
Registration Statement number of the earlier effective Registration Statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]

CALCULATION OF REGISTRATION FEE
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PROPOSED PROPOSED
TITLE OF EACH CLASS OF AMOUNT MAXIMUM MAXIMUM AMOUNT OF
SECURITIES TO BE TO BE OFFERING PRICE AGGREGATE REGISTRATION FEE
REGISTERED REGISTERED PER SHARE OFFERING PRICE (1) (2)
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value
$0.01 per share....... 5,060,000 $16.00 $80,960,000 $22,507
- ------------------------------------------------------------------------------------------------------
</TABLE>
- -------------------------------------------------------------------------------
(1) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457 of the Securities Act of 1933, as amended.

(2) Previously paid in connection with the filing of this Registration
Statement on May 22, 1998 and the filing of Amendment No. 3 to this
Registration Statement on July 20, 1998 by the payment of an aggregate
amount of $42,916.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO
SECTION 8(A), MAY DETERMINE.

- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TOBUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

SUBJECT TO COMPLETION

PRELIMINARY PROSPECTUS DATED NOVEMBER 4, 1998

PROSPECTUS

4,400,000 SHARES

[MERKERT AMERICAN CORP. LOGO APPEARS HERE]

COMMON STOCK

All of the 4,400,000 shares of Common Stock offered hereby (the "Offering")
are being sold by Merkert American Corporation (the "Company"). Prior to the
Offering, there has been no public market for the Common Stock. It is currently
estimated that the initial public offering price will be between $14.00 and
$16.00 per share. For a discussion relating to factors to be considered in
determining the initial public offering price, see "Underwriting." Application
has been made to list the Common Stock for quotation on the Nasdaq National
Market under the symbol "MERK."

SEE "RISK FACTORS" BEGINNING ON PAGE 11 FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED
HEREBY.

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.

------------

<TABLE>
<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC DISCOUNT(1) COMPANY(2)
-------- ------------ -----------
<S> <C> <C> <C>
Per Share................................. $ $ $
Total(3).................................. $ $ $
</TABLE>
- ------
(1) The Company has agreed to indemnify the several Underwriters against
certain liabilities, including certain liabilities under the Securities Act
of 1933, as amended. See "Underwriting."

(2) Before deducting expenses payable by the Company, estimated at
$[ ].

(3) The Company has granted to the Underwriters an option to purchase up to an
additional 660,000 shares of Common Stock, exercisable within 30 days after
the date hereof, solely to cover over-allotments, if any. If such option is
exercised in full, the total Price to Public, Underwriting Discount and
Proceeds to Company will be $ , $ and $ , respectively. See
"Underwriting."

------------

The shares of Common Stock are offered by the several Underwriters, subject
to prior sale, when, as and if issued to and accepted by them, subject to
approval of certain legal matters by counsel for the Underwriters and certain
other conditions. The Underwriters reserve the right to withdraw, cancel or
modify such offer and to reject orders in whole or in part. It is expected that
delivery of the shares of Common Stock will be made in , on or about
, 1998.

The date of this Prospectus is , 1998.
<PAGE>

[Map of United States showing territory covered by the Company and the
location of the Company's facilities]

[ART WORK]
[Other art work to be provided by amendment]

CERTAIN PERSONS PARTICIPATING IN THE OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK.
SUCH TRANSACTIONS MAY INCLUDE STABILIZING, THE PURCHASE OF COMMON STOCK TO
COVER SYNDICATE SHORT POSITIONS AND THE IMPOSITION OF PENALTY BIDS. FOR A
DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."
<PAGE>

PROSPECTUS SUMMARY

Unless the context otherwise requires, all references to the "Company" herein
mean Merkert American Corporation, a Delaware corporation, together with
Merkert Enterprises, Inc., a Massachusetts corporation ("Merkert"), and Rogers-
American Company, Inc., a North Carolina corporation ("Rogers"), after
consummation of the Combination (as defined herein). References to the
Company's business prior to the Combination mean the business of each of
Merkert and Rogers, including each of their respective subsidiaries. Prior to
May 29, 1998, the Company operated under the name Monroe, Inc. See "The
Combination."

The following summary is qualified in its entirety by, and should be read in
conjunction with, the more detailed information and financial statements and
related notes appearing elsewhere in this Prospectus. Unless otherwise
indicated, all share, per share and financial information in this Prospectus
(a) has been adjusted to give effect to the Combination, (b) assumes payment
prior to the consummation of the Combination and the Offering of a stock
dividend of 734.3494 shares of Common Stock and 144.2802 shares of Restricted
Common Stock (as defined herein) in respect of each issued and outstanding
share of Common Stock, (c) assumes an initial public offering price of $15.00
per share, (d) assumes no exercise of the Underwriters' over-allotment option
and (e) does not include shares issuable upon exercise of outstanding options
or reserved for issuance pursuant to the Company's stock option and incentive
plan. See "The Combination," "Management--1998 Stock Option and Incentive
Plan," and "Underwriting."

THE COMPANY

The Company was organized in March 1998 to create a leading food brokerage
firm providing outsourced sales, merchandising and marketing services to
manufacturers, suppliers and producers of food products and consumer goods
("Manufacturers"). The Company acts as an independent sales and marketing
representative, selling grocery and consumer products on behalf of
Manufacturers and coordinating the execution of Manufacturers' marketing
programs with retailers and wholesalers ("Retailers"). The Company's principal
source of revenues is commissions that it receives from Manufacturers. The
Company's other activities include managing private label programs on behalf of
selected Retailers.

The Company has long-standing relationships with many of its Manufacturers,
including Dean Foods/Birds Eye (41 years), H.J. Heinz (24 years), Minute Maid
(44 years), Ocean Spray (29 years) and Pillsbury (19 years). Key Retailer
relationships include C&S Wholesale Grocers, Inc., Food Lion Supermarkets,
Hannaford Brothers, Kroger, Publix Supermarkets, Royal Ahold (including Stop &
Shop, Bi-Lo and Giant Food), Safeway, Wakefern (Shop Rite) and Winn-Dixie. The
Company represents more than 750 Manufacturers and more than 70,000 food and
non-food stock-keeping units ("SKUs"), and does business with key Retailers in
22 states.

Since 1994, Rogers and Merkert have acquired and integrated 21 companies,
successfully adding coverage of new geographic markets and expanding
representation of Manufacturers' product offerings within existing markets. The
Company's strategic acquisition plan includes the selection, acquisition and
management of businesses in brokerage market segments, including the retail
food brokerage, food service brokerage and private label brokerage market
segments.

The Company will be the first publicly held food broker in the United States.
The Company is the only food broker with comprehensive geographic coverage of
the eastern United States and the capability to provide service to the region's
largest Retailers. The eastern United States is the most highly concentrated
retail store region in the United States and represents approximately 43% of
national food store sales. The Company has 30 offices servicing Retailers in 22
states. In 1997, the Company had pro forma combined revenue of approximately
$230.4 million and pro forma combined net income of approximately $0.2 million.

Simultaneously with the consummation of the Offering, the Company will
purchase in separate transactions (collectively, the "Combination") all of the
issued and outstanding capital stock of Merkert and Rogers. To date, the
Company has conducted operations only in connection with the Offering and the
Combination. See "Certain Transactions--Organization of the Company" and "The
Combination."

3
<PAGE>

INDUSTRY OVERVIEW

The Company estimates, based on information published by industry sources,
that the food brokerage industry in the United States had annual commission
revenues of approximately $6 billion in 1997. A portion of such revenues were
earned in connection with retail merchandising activities. According to
industry sources, the retail merchandising industry in the United States had
annual revenues of approximately $11.7 billion (exclusive of retail
merchandising revenues in the food brokerage industry) in 1997. Food brokers
firms serve Manufacturers, Retailers and food service providers. Retail food
brokers represent approximately 3,200 Manufacturers that sell to approximately
128,000 grocery stores, including chain and independent supermarkets,
convenience stores, wholesale clubs and other stores ("Grocery Stores") and
more than 700 wholesalers nationwide. The industry includes three types of food
brokers, as follows:

Retail Food Brokers. Manufacturers of branded food and non-food products use
retail food brokers as a cost effective alternative to a direct sales force and
rely on retail food brokers to provide local market penetration, integrated
brand and category-management and access to local merchandising data. When a
broker provides full services to a Manufacturer in connection with the sale of
its products to Retailers, the commission earned is generally 3% of the
Manufacturer's net sales to such Retailers. Retail food brokers typically
perform two types of services on behalf of Manufacturers: headquarters
functions and retail store functions.

Headquarters functions include services provided to both Manufacturers and
Retailers at the headquarters level. Retail food brokers conduct business
development activities, including sales calls and new product introductions to
Retailers, on behalf of Manufacturers. Retail food brokers also assist
Manufacturers in developing, reviewing and executing annual marketing plans.
Other headquarters services include order management, supervision of shelf
space management, coordination of Manufacturers' promotional spending, and
facilitating the resolution of billing issues between Manufacturers and
Retailers. In connection with the implementation of category management at the
Retailers' headquarters level, retail food brokers assist Retailers by
gathering and analyzing demographic, consumer, and store sales information
utilized in the management of product categories as strategic business units.

Retail store functions generally include execution of sales plans for
Manufacturers' products at the store level by assisting in merchandising, shelf
and display management, new store set-ups, implementation of promotional plans,
and placement of point-of-sale coupons, signs and other information. Retail
food brokers also assist Retailers with coupon and advertising programs,
quality assurance and technical training (primarily in relation to prepared
foods). In addition, retail food brokers assist Retailers and Manufacturers in
the collection, analysis and application of retail sales data.

The retail food brokerage industry has been growing as food brokers represent
an increasing percentage of the volume of all commodities (the "ACV") sold
through Grocery Stores. In 1997, the percentage of ACV sold through Grocery
Stores was approximately 55% compared to 45% in 1985. According to Progressive
Grocer, Grocery Store revenues, of which an increasing portion is represented
by food brokers, are generally not materially adversely affected by economic
downturns and have grown from approximately $292 billion in 1985 to $436
billion in 1997.

The Company believes that the retail food brokerage industry is highly
fragmented and is experiencing significant consolidation. In the past 10 years,
the number of food brokerage firms has decreased from 2,500 to 1,000, while the
number of sales representatives employed by such firms increased from 35,000 to
42,000. There are five multi-regional food brokerage firms, including the
Company, each with approximately 3% market share. In total, there are
approximately 12 large regional food brokerage firms in the United States. A
number of the companies in the food brokerage industry, including Merkert and
Rogers, have participated in the trend towards consolidation by acquiring other
food brokerage businesses, generally financing these transactions with debt
and/or by deferring the payment of a portion of the purchase price.

4
<PAGE>

The Company believes that the consolidation of food brokers is primarily the
result of a desire by Manufacturers and Retailers to manage their businesses
more efficiently and effectively by reducing the number of brokers they
interact with in a given region. Additionally, management believes that
consolidation within the food brokerage industry is being driven, in part, by
the consolidation of Retailers and Manufacturers and the increasing demand for
the application of more sophisticated information technology on the part of
food brokers.

Food Service Brokers. Food service providers include operators of
restaurants, school and hospital cafeterias and other similar establishments.
The food service business also includes prepared meals sold at convenience
stores. Food brokers sell Manufacturers' products to food service providers
through a number of means, including headquarters sales calls and the
representation of Manufacturers' products at trade shows. The food service
segment of the industry has experienced significant growth in recent years as
an increasing percentage of consumer spending for food in the United States has
shifted to meals away from home.

Private Label Food Brokers. Private label food brokers work with
Manufacturers to develop and manage private label programs on behalf of
Retailers. A food broker's responsibilities in connection with a private label
program may include procurement and inventory management and in-store delivery
of private label products. The private label segment has been a substantial
growth segment for Retailers in recent years.

BUSINESS STRATEGY

The Company's objective is to become one of the leading national providers of
outsourced sales, merchandising and marketing services to Manufacturers,
Retailers and food service providers throughout the United States. The
Company's business strategy comprises the following key elements:

Expand Current and Develop New Manufacturer Relationships. The Company seeks
to increase its representation of existing Manufacturers' product lines by
representing Manufacturers' products in new geographic markets and non-
supermarket trade channels, including mass merchandisers, food service
providers, membership warehouses, drug stores and convenience stores. The
Company also seeks to increase the range of products it represents on behalf of
the Manufacturers it currently serves and enter into new relationships with
Manufacturers.

Provide Effective Marketing Support and Valuable Category Management
Technology. The Company's marketing expertise and information technology system
allow it to utilize local demographic information and information about retail
store level conditions to understand consumer purchasing preferences in local
markets. As a result, the Company is able to develop and implement targeted
consumer sales promotions for its Manufacturers' products. The Company also
deploys category analysts who use local sales data to assist Retailers with
shelf schematics, category layouts and total store space management.

Growth Through Strategic Acquisitions. The Company intends to pursue
strategic acquisitions in the food brokerage industry. Since 1994, Merkert and
Rogers have acquired and integrated 21 companies, successfully adding coverage
of new geographic markets and expanding representation of Manufacturers'
product offerings in existing markets. The Company's plans include the
selection, acquisition and management of businesses in the retail, food service
and private label segments of the brokerage market. The Company believes that
its acquisition strategy will enable it to strengthen its market presence,
increase economies of scale and improve operating efficiencies.

Increase Private Label Brokerage. The Company has a division that specializes
in the development, procurement and inventory management of private label
frozen products, including fruits, vegetables and other products on behalf of
certain Retailers. The Company's private label division currently works in
conjunction with Retailers such as A&P, Price Chopper, Publix and Royal Ahold
(including Stop & Shop, Bi-Lo and Giant Food). The increasing geographic
coverage of the Company will provide the Company with the opportunity to offer
private label services to more Retailers and retail locations.

5
<PAGE>

COMPANY HISTORY

Merkert Enterprises, Inc., one of the entities to be acquired in the
Combination, has operated as a food broker in the northeastern and mid-Atlantic
regions of the United States since 1950. In 1997, Merkert Enterprises, Inc. had
total revenues of approximately $147.4 million, the principal source (71%) of
which was commissions it received from Manufacturers. Merkert Enterprises, Inc.
also manages private label programs on behalf of selected Retailers. Merkert
Enterprises, Inc. has grown its revenues through both internally generated
growth and through acquisitions, having acquired and integrated six smaller
food brokers since 1994. Merkert Enterprises, Inc. financed such acquisitions,
in part, with debt and/or by deferring the payment of a portion of the purchase
price. A portion of the net proceeds of the Term Loan (as defined herein) will
be used to repay certain of such acquisition-related obligations of Merkert
Enterprises, Inc. Primarily as a result of such obligations, as well as a
substantial tax liability, Merkert Enterprises, Inc. has experienced losses and
a working capital deficit in recent years. The stockholders of Merkert
Enterprises, Inc. have agreed to pay such tax liability from cash otherwise
payable to them in connection with the Combination. After giving effect to the
Offering and the expected application of the net proceeds therefrom and the
application of the Term Loan proceeds, the Company will not have a working
capital deficit. See "Risk Factors--Merkert Enterprises, Inc.-History of
Losses" and "Management's Discussion and Analysis of Financial Condition and
Results of Operations--Results of Operations--Merkert," "--Liquidity and
Capital Resources--Merkert" and "--Combined Liquidity and Capital Resources
Following the Combination" and "Use of Proceeds."

Rogers has operated as a food broker in the southeastern region of the United
States since 1934. In 1997, Rogers had total revenues of approximately $83.0
million, all of which was derived from commissions it received from
Manufacturers. Rogers has grown its revenues through both internally generated
growth and through acquisitions, having acquired and integrated 15 smaller food
brokers since 1994.

The Company is a Delaware corporation with its executive offices located at
490 Turnpike Street, Canton, Massachusetts 02021. The Company's telephone
number is (781) 828-4800.

6
<PAGE>

THE OFFERING

<TABLE>
<C> <S>
Common Stock offered by the Company..... 4,400,000 shares.
Common Stock to be outstanding after the
Offering(1)(2)......................... 7,150,000 shares.
Use of proceeds......................... The net proceeds to be received by
the Company in the Offering together
with amounts available under the Term
Loan portion of the Company's Credit
Facility (each as defined herein)
will be used to finance the cash
portion of the consideration to be
paid in the Combination, to repay
certain indebtedness of Merkert and
Rogers, to fund buyouts of certain
obligations of Merkert and Rogers to
make payments to sellers of
previously acquired businesses, to
repay a note payable to Monroe &
Company II, LLC which is attributable
to certain of the Company's expenses,
to fund buyouts of employment
arrangements of departing executives
of Merkert as well as buyouts of
certain consulting arrangements, to
pay expenses incurred by the Company
and each of Merkert and Rogers and
their respective stockholders in
connection with the Combination. See
"Use of Proceeds."
Proposed Nasdaq National Market symbol.. MERK.
</TABLE>
- --------

(1) Includes 1,166,667 shares of Common Stock to be issued to the stockholders
of Merkert in connection with the Combination. Excludes (i) 245,000 shares
of Common Stock issuable upon exercise of outstanding stock options granted
pursuant to the Company's Amended and Restated 1998 Stock Option and
Incentive Plan (the "1998 Stock Plan"), (ii) options to purchase 65,000
shares of Common Stock to be granted to the Company's independent
directors, (iii) options to purchase 340,000 shares of Common Stock to be
granted upon consummation of the Offering and (iv) 279,500 shares of Common
Stock available for future grants under the 1998 Stock Plan. See
"Management--1998 Stock Option and Incentive Plan." At the request of the
Company, the Underwriters have reserved for sale, at the initial public
offering price, up to 5% of the shares offered hereby to be sold to certain
directors, officers, and employees of the Company and certain distributors,
dealers, business associates and related persons. See "Underwriting."

(2) Includes 1,583,333 shares of Common Stock held by Monroe & Company II, LLC
and Gerald R. Leonard, 260,000 of which are shares of Restricted Common
Stock. Each share of Restricted Common Stock is entitled to 1/10th of one
vote on all matters submitted to the stockholders of the Company.
Restricted Common Stock is convertible into one share of Common Stock under
certain circumstances. See "Description of Capital Stock--Authorized and
Outstanding Capital Stock."

RISK FACTORS

Purchasers of Common Stock in the Offering should carefully consider the risk
factors set forth under the caption "Risk Factors" and the other information
included in this Prospectus prior to making an investment decision. See "Risk
Factors."

7
<PAGE>

SUMMARY PRO FORMA COMBINED FINANCIAL DATA
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

The Company has conducted operations to date only in connection with the
Combination and the Offering, and will purchase Merkert and Rogers
simultaneously with and as a condition to the consummation of the Offering. For
financial statement presentation purposes, the Company has been designated as
the accounting acquiror. The following table presents summary pro forma
combined financial data of the Company, as adjusted for: (i) the consummation
of the Combination; (ii) certain pro forma adjustments to the historical
financial statements of Merkert and Rogers; and (iii) the consummation of the
Offering and the application of the net proceeds therefrom and the application
of the borrowings available from the Term Loan portion of the Company's Credit
Facility. The unaudited pro forma combined financial data set forth do not
purport to represent the Company's combined results of operations or financial
position for any future period. The summary combined financial data set forth
below should be read in conjunction with, and are qualified by reference to,
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," the Company's Unaudited Pro Forma Combined Financial Statements
and the Notes thereto and the Merkert and Rogers financial statements and the
Notes thereto included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
YEAR ENDED SIX MONTHS
DECEMBER 31, ENDED JUNE 30,
1997 1998
------------ --------------
PRO FORMA PRO FORMA
------------ --------------
<S> <C> <C>
STATEMENT OF OPERATIONS DATA (1)(2)(3)(4)
Sales....................................... $ 43,105 $ 21,537
Commissions................................. 187,259 87,946
---------- ----------
Revenues.................................... 230,364 109,483
Cost of sales............................... 39,027 19,591
Selling, general and administrative
expense.................................... 177,299(2) 84,402(2)
Restructuring expense....................... -- --
Depreciation and amortization(3)............ 5,889 2,973
---------- ----------
Operating income............................ 8,149 2,517
Interest expense(9)......................... 6,394 2,783
Other (income) expense, net................. (79) 120
---------- ----------
Income before income taxes.................. 1,834 (386)
---------- ----------
Net income.................................. $ 200 $ (664)
========== ==========
Net income per share........................ $ 0.03 $ (0.09)
========== ==========
Shares used in computing net income
per share(5)............................... 7,150,000 7,150,000
========== ==========
Diluted income per share.................... 0.03 (0.09)
========== ==========
Shares and potential dilutive securities
used in computing diluted earnings per
share...................................... 7,211,250 7,150,000
========== ==========
OTHER FINANCIAL DATA:
EBITDA(6)................................... $ 14,117 $ 5,370
========== ==========
<CAPTION>
AS OF JUNE 30, 1998
PRO FORMA
COMBINED(7) AS ADJUSTED(8)
------------ --------------
<S> <C> <C>
BALANCE SHEET DATA
Working capital (deficit)................... $ (103,942)(9) $ 2,738
Total assets................................ 168,745 170,790
Total long-term debt, net of current
portion.................................... 17,066 67,066
Stockholders' equity........................ 14,875 73,755
</TABLE>

Footnotes on following page

8
<PAGE>

FOOTNOTES FOR SUMMARY PRO FORMA COMBINED FINANCIAL DATA

(1) The Summary Pro Forma Combined Financial Data assume that the Combination
and the Offering took place on January 1, 1997 and are not necessarily
indicative of the results the Company would have obtained had these events
actually occurred on that date or of the Company's future results.

(2) In connection with the Combination and the Offering, the Company intends to
achieve significant cost savings through the integration of the operations
of Merkert and Rogers. This process has already begun and has resulted in
the integration of the New York City metropolitan region and the mid-
Atlantic region and the closure of a total of seven offices in such
regions. The Company anticipates the integration actions will be
substantially completed by the closing of the Combination and the Offering
and that the savings from the integration actions will be substantially
realized in the remainder of 1998 and in 1999. The $520 restructuring
charge recorded by Merkert in the second quarter has been eliminated on the
Pro Forma Statement of Operations. The savings primarily result from the
closing of offices due to overlapping geographic coverage and the
elimination of duplicative operations. The cost savings include the
elimination of employee payroll and benefits, certain rental and office
expenses relating to the closing of offices, as well as other direct costs.
These savings will be offset, in part, by an anticipated loss of revenue
resulting from Manufacturer conflicts. In addition, the Company expects to
incur an increase in lease expense and a reduction in depreciation expense
as a result of the sale of Rogers' headquarters to a third party and the
related leaseback of the facility to the Company. The Company expects the
impact of these integration adjustments on Pro Forma Combined EBITDA to be
as follows (dollars in thousands):

<TABLE>
<CAPTION>
SIX MONTHS
YEAR ENDED ENDED
DECEMBER 31, JUNE 30,
1997 1998
------------ ----------
<S> <C> <C>
Pro Forma Combined EBITDA........................... $14,117 $ 5,370
Elimination of salaries, benefits, bonuses and
other direct costs................................ 14,456 7,931
Elimination of rental and other office expenses.... 1,084 542
Loss of revenue resulting from Manufacturer con-
flicts............................................ (5,900) (2,300)
Increase in lease expense resulting from the sale
of Rogers' headquarters and associated leaseback.. (650) (325)
------- -------
Pro Forma Combined EBITDA (after integration adjust-
ments)............................................. $23,107 $11,218
======= =======
Pro Forma Combined Net Income....................... $ 5,737 $ 2,950
======= =======
Net Income Per Share................................ $ 0.80 $ 0.41
======= =======
</TABLE>

(3) Includes $3,300 for the twelve months ended December 31, 1997 and $1,675
for the six months ended June 30, 1998 of amortization of goodwill and
other intangibles to be recorded as a result of the Combination computed on
the basis described in the Notes to Unaudited Pro Forma Combined Financial
Statements.

(4) Represents the adjustment to record the income tax provision after
considering the non-deductibility of goodwill.

(5) Includes (i) shares to be issued in the Combination to stockholders of
Merkert, (ii) shares issued to the management of and consultants to the
Company, and (iii) shares sold in this Offering necessary together with
borrowings under the Company's Term Loan to pay the cash portion of the
Combination consideration, retire certain indebtedness relating to bank
debt and other obligations of Merkert and Rogers and pay the expenses of
the Offering and the Combination. In addition, shares and potential
dilutive securities used in computing diluted earnings per share include
the dilutive effect of currently outstanding options to purchase shares of
Common Stock.

(6) EBITDA represents earnings before interest, taxes, depreciation and
amortization. The Company believes that EBITDA may be useful to investors
for measuring the Company's ability to service debt, to make new
investments and to meet working capital requirements. EBITDA as calculated
by the Company may not be consistent with calculations of EBITDA by other
companies. EBITDA should not be considered in isolation from or as a
substitute for net income (loss), cash flows from operating activities or
other statements of operations or cash flows prepared in accordance with
generally accepted accounting principles or as a measure of profitability
or liquidity.

(7) The Pro Forma Summary Combined Balance Sheet assumes that the Combination
was consummated on June 30, 1998.

(8) Adjusted for the sale of 4,400,000 shares of Common Stock offered hereby
and the expected application of the net proceeds therefrom. See "Use of
Proceeds."

(9) Includes interest expense of $4,500 for the twelve months ended December
31, 1997 and $2,250 for the six months ended June 30, 1998 associated with
the Term Loan being obtained at the closing of the Combination and the
Offering.

9
<PAGE>

SUMMARY INDIVIDUAL FINANCIAL DATA FOR MERKERT AND ROGERS
(DOLLARS IN THOUSANDS)

The following table presents summary financial data for each of Merkert and
Rogers for each of the three years ended December 31, 1995, 1996 and 1997 and
the six month periods ended June 30, 1997 and 1998 and have not been adjusted
to reflect the Combination or the related changes that are reflected in the Pro
Forma Statements of Operations. See the Unaudited Pro Forma Combined Financial
Statements and the Notes thereto and the Merkert and Rogers financial
statements and the Notes thereto included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, JUNE 30,
------------------------ ------------------
1995 1996 1997 1997 1998
------- ------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
MERKERT
Commissions...................... $73,336 $80,661 $104,274 $ 51,816 $ 46,304
Sales............................ 49,233 44,916 43,105 20,864 21,537
------- ------- -------- -------- --------
Revenues....................... 122,569 125,577 147,379 72,680 67,841
Operating income (loss)(1)....... 2,434 633 1,373 (2,962) (1,448)
OTHER FINANCIAL DATA
EBITDA(2)........................ 4,566 3,080 5,857 (655) 944
ROGERS
Commissions...................... $47,496 $63,311 $ 82,985 $ 41,053 $ 41,643
Operating income................. 3,149 107 4,085 649 2,083
OTHER FINANCIAL DATA
EBITDA(2)........................ 4,222 1,753 6,601 2,057 3,236
</TABLE>
- --------

(1) Includes a restructuring charge of $520 for the second quarter of 1998.

(2) EBITDA represents earnings before interest, taxes, depreciation and
amortization. The Company believes that EBITDA may be useful to investors
for measuring the Company's ability to service debt, to make new
investments and to meet working capital requirements. EBITDA as calculated
by the Company may not be consistent with calculations of EBITDA by other
companies. EBITDA should not be considered in isolation from or as a
substitute for net income (loss), cash flows from operating activities or
other statements of operations or cash flows prepared in accordance with
generally accepted accounting principles or as a measure of profitability
or liquidity.

10
<PAGE>

RISK FACTORS

The following factors should be carefully considered, together with the
other information in this Prospectus, in evaluating an investment in the
Company. This Prospectus contains, in addition to historical information,
forward-looking statements that involve risks and uncertainties. The Company's
actual results could differ significantly from the results discussed in the
forward-looking statements. Factors that could cause or contribute to such
differences include those risk factors set forth below as well as those
factors discussed elsewhere in this Prospectus.

ABSENCE OF COMBINED OPERATING HISTORY; RISKS OF INTEGRATION

To date, Merkert and Rogers have operated independently of one another. The
Company intends to operate Merkert and Rogers and subsequently acquired
businesses on a cohesive, but locally oriented, basis. If proper overall
business incentives and controls are not implemented, this locally oriented
operating strategy could result in inconsistent operating and financial
practices and the Company's overall profitability could be adversely affected.
The integration of Merkert and Rogers may involve unforeseen difficulties and
costs and may require a disproportionate amount of management's attention and
of the Company's financial and other resources. Of the total estimated
integration costs of $11.1 million, approximately $3.3 million will be paid
prior to the closing of the Offering by Merkert and Rogers, approximately $1.5
million will be paid with a portion of the proceeds from the Offering and the
remainder will be paid subsequent to the Offering. The failure of the Company
to integrate successfully the operations of Merkert and Rogers and
subsequently acquired businesses could have a material adverse effect on the
Company's business, financial condition and results of operations. See
"Management" and "Business--Business Strategy." Currently, the Company has no
centralized financial reporting system and initially will rely on the existing
reporting systems of each of Merkert and Rogers. Merkert and Rogers offer
different services, use different capabilities and technologies, target
different clients and have different management styles. Although the Company
believes that there are substantial opportunities to cross-market and
integrate the businesses of Merkert and Rogers, these differences increase the
risk inherent in the integration of the two companies. There can be no
assurance that the Company will be able to integrate successfully the
operations of Merkert and Rogers or that the expense of such integration
program will not exceed management's expectations or that the Company will be
able to institute the necessary Company-wide systems and procedures to manage
successfully the combined enterprise on a profitable basis or to implement the
Company's business and growth strategies.

IMPLEMENTATION OF ACQUISITION STRATEGY; RISKS RELATED TO GROWTH STRATEGY

One of the Company's strategies is to increase its revenues and the markets
it serves through the acquisition of additional food brokerage companies. The
Company expects to spend significant time and effort in expanding its existing
business and identifying, completing and integrating acquisitions. Moreover,
the Company expects to face competition for acquisition candidates which may
limit the number of acquisition opportunities available to the Company and may
result in higher acquisition prices. There can be no assurance that the
Company will be able to identify, acquire or profitably manage additional
companies or successfully integrate such additional companies into the Company
without substantial costs, delays or other problems. In addition, there can be
no assurance that companies acquired in the future will achieve sales and
profitability that justify the investment therein. The Company's inability to
identify appropriate acquisition candidates, to acquire such candidates at
prices acceptable to the Company or to manage such acquired businesses
profitably could have a material adverse effect on the Company's business,
financial condition and results of operations. In addition, acquisitions may
involve a number of special risks, including adverse short-term effects on the
Company's reported operating results, Manufacturer representation conflicts,
diversion of management's attention, dependence on retention, hiring and
training of key personnel, risks associated with unanticipated problems or
legal liabilities and amortization of acquired intangible assets, some or all
of which could have a material adverse effect on the Company's business,
financial condition and results of operations. The Company is currently
engaged in discussions regarding the potential acquisition of a food broker
operating in a territory contiguous to the Company's current territory. There
can be no assurance that the Company will enter into an agreement with

11
<PAGE>

respect to such acquisition or as to the terms of any such agreement. Further
there can be no assurance that, if such acquisition is consummated, the
Company will be able to successfully integrate the acquired entity into its
operations or to operate the acquired business profitably. See "Business--
Business Strategy."

The Company currently intends to finance future acquisitions by using cash,
Common Stock, or additional debt or equity financing. There can be no
assurance that the Company will be able to obtain such debt or equity
financing if and when it is needed or that, if available, such financing will
be on terms acceptable to the Company. Any debt financing will result in
additional leverage and any further equity financing may result in dilution to
the Company's stockholders. In the event that the Company does not have
sufficient cash resources, or if the Common Stock does not maintain a
sufficient valuation, or if potential acquisition candidates are unwilling to
accept shares of Common Stock as consideration, the Company may be unable to
implement its acquisition strategy. The Company is obligated to make payments
to the sellers of certain businesses acquired by Merkert and Rogers, some of
which are payable only in the event that the earnings attributable to any of
such businesses exceed specific thresholds determined at the time of
acquisition. The Company may incur similar obligations with respect to
acquisitions completed after the Offering. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations--Liquidity and
Capital Resources" and "Business--Business Strategy."

The Company's growth strategy includes broadening its service and product
offerings, implementing an aggressive marketing plan, and deploying leading
technologies. There can be no assurance that the Company's systems, procedures
and controls will be adequate to support the Company's operations as they
expand. Any future growth also will impose significant added responsibilities
on members of senior management, including the need to identify, recruit and
integrate new senior level managers and executives. There can be no assurance
that such additional management can be identified and retained by the Company.
The inability of the Company to manage its growth or recruit and retain
additional qualified management could have a material adverse effect on the
Company's business, financial condition and results of operations. See
"Business--Business Strategy" and "Management."

There can be no assurance that the Company's growth strategy will be
successful or that the Company will be able to generate cash flow sufficient
to fund its operations and to support internal growth. The Company's inability
to achieve internal earnings growth or otherwise execute its growth strategy
could have a material adverse effect on the Company's business, financial
condition and results of operations. See "Business--Business Strategy."

MATERIALITY AND ACCOUNTING TREATMENT OF GOODWILL

The Company's balance sheet immediately following the Offering and
consummation of the Combination will include an amount designated as
"goodwill" that represents approximately 70% of assets and approximately 162%
of stockholders' equity.

Goodwill arises when an acquiror pays more for a business than the fair
value of the tangible and separately measurable intangible net assets.
Generally accepted accounting principles require that goodwill and all other
intangible assets be amortized over the period benefited. Management has
determined this amortization period to be 40 years. If management used a 40-
year amortization period for goodwill or any other material intangible asset
having an actual benefit period of less than 40 years, earnings reported in
periods following the acquisition of such goodwill or intangible asset would
be overstated. If the amortization period used by management is longer than
the related benefit period, in later years the Company would be burdened by a
continuing charge against earnings without the associated benefit to income
valued by management in arriving at the consideration paid for the business.
In addition, earnings in later years could also be significantly affected if
management determined then that the remaining balance of goodwill was
impaired. Management has concluded that the anticipated future cash flows
associated with intangible assets recognized in the Combination will continue
for 40 years and that there is no persuasive evidence that any material
portion will dissipate over a period shorter than 40 years. See the Unaudited
Pro Forma Combined Financial Statements of the Company and the Notes thereto
included elsewhere in this Prospectus.

12
<PAGE>

The Financial Accounting Standards Board (the "FASB") has undertaken a
project to comprehensively reconsider the accounting standards for business
combinations. In connection with this project, the FASB may consider such
issues as the accounting for goodwill including its amortization periods. The
Company is presently unable to determine what the results, if any, of this
project may be.

MERKERT ENTERPRISES, INC.-- HISTORY OF LOSSES

One of the companies to be acquired in the Combination, Merkert Enterprises,
Inc., incurred a net loss in each of the three years ended December 31, 1995,
1996 and 1997. In addition, Merkert Enterprises, Inc.'s cash flow from
operations and available borrowings have been insufficient to satisfy its
capital requirements, which are principally to fund obligations to sellers in
connection with previous acquisitions, working capital and income taxes
payable. As of June 30, 1998, Merkert was not in compliance with certain
financial convenants under its revolving line of credit agreement and was in
default of such agreement. As a result of this historical working capital
deficit at Merkert Enterprises, Inc., Arthur Andersen LLP has qualified its
report for the period ended December 31, 1997 relative to the ability of
Merkert Enterprises, Inc. to continue as a going concern. After giving effect
to the Offering and the expected application of the net proceeds therefrom and
the application of the borrowings available from the Term Loan portion of the
Company's Credit Facility, the Company will not have a working capital
deficit. However, there can be no assurance that the Company will be able to
generate sufficient cash flow to meet its future capital requirements or that
the Company will not have a working capital deficit in the future. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Results of Operations--Merkert" and "--Liquidity and Capital
Resources--Merkert."

SUBSTANTIAL LEVERAGE

Following the consummation of the Combination and related transactions, the
Company will have indebtedness that is substantial in relation to its
stockholders' equity, as well as interest and debt service requirements that
are significant compared to its income and cash flow from operations. At June
30, 1998, on a pro forma basis, after giving effect to Offering and the use of
the net proceeds of the Offering and of the amount available under the Term
Loan as described herein, the Company's total indebtedness would have been
approximately $68.6 million.

The degree to which the Company is leveraged could have significant
consequences including the following: (i) the Company's ability to obtain
additional financing in the future for working capital, capital expenditures,
acquisitions or general corporate purposes may be impaired, (ii) a substantial
portion of the Company's cash flow from operations must be dedicated to the
payment of interest on its indebtedness, thereby reducing funds available to
the Company for other purposes, (iii) the Company expects that the agreements
governing the Credit Facility will contain certain restrictive financial and
operating covenants, and (iv) the Company's degree of leverage may limit its
flexibility to adjust to changing market conditions, reduce its ability to
withstand competitive pressures and make it more vulnerable to a downturn in
general economic conditions or its business. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations--Combined Liquidity
and Capital Resources Following the Combination."

MANUFACTURER REPRESENTATION CONFLICTS

Certain Manufacturers may not allow food brokers they have engaged to
represent any lines or products such Manufacturers believe to be in
competition with their own line of products in a given market territory.
Manufacturers can be subjective in their definition of a conflict. In
addition, a Manufacturer may object to the Company's private label business or
its representation of another Manufacturer which produces a similar product
for sale in other geographic regions or trade channels. The Company is
sensitive to potential conflicts and must exercise care in determining how to
resolve conflicts and potential conflicts as new food broker businesses are
acquired and as Manufacturers continue to grow, merge and expand into new
product categories and geographic areas. The Combination may result in certain
Manufacturer conflicts, particularly in the mid-Atlantic where the operations
of Merkert and Rogers overlap. The Company may be required, in order to
resolve a conflict, to choose to represent particular lines or products in
lieu of others, and the Company may not select the lines of products that are
ultimately the most successful. The inability of the Company to resolve or
deal with

13
<PAGE>

Manufacturer representation conflicts or potential conflicts could have a
material adverse effect on the Company's business, financial condition and
results of operations. In addition, industry practice is that food brokers'
relationships with Manufacturers are governed by contracts which are typically
terminable by either party upon 30 days' notice. In the ordinary course of
business the Company experiences turnover in these relationships as a result
of Manufacturer conflicts and strategic decisions by the Company or a
Manufacturer.

POTENTIAL CHANGES IN INDUSTRY

The food brokerage industry is presently being affected by changes in the
industries of both Manufacturers and Retailers as well as by changes in the
food brokerage industry itself. Consolidation among both Manufacturers and
Retailers has resulted in a competitive advantage for food brokers which can
offer products and services on a regional or national basis and as a
consequence has contributed to the consolidation of the food brokerage
industry. In addition, mass merchandisers such as warehouse clubs and
superstores have experienced significant growth in recent years. Historically,
many mass merchandisers have tended to use fewer brokerage services and,
instead, rely on direct relationships with Manufacturers. These changes in the
food industry marketplace will require the Company to adapt its operations.
There can be no assurance that the Company will be able to adjust to such
industry changes or that the changes the Company undertakes will be effective
and enable the Company to operate its business profitably. The inability of
the Company to make appropriate adjustments in response to these trends could
have a material adverse effect on the Company's business, financial condition
and results of operations.

COMPETITION

The food brokerage industry is highly fragmented and competitive. The
Company's competitors include several large privately held companies and
hundreds of small privately held food brokers. The food brokerage industry is
currently undergoing substantial consolidation. In addition, many
Manufacturers, including some of the Manufacturers served by the Company,
employ sales personnel to sell directly to Retailers and distributors.
Further, food brokers also compete with specialty distributors, wholesalers
and other entities engaged in businesses which provide avenues of distribution
linking Manufacturers, Retailers, food service establishments and/or
consumers. Certain of these competitors may have lower overhead costs than the
Company, have greater financial resources than the Company or have better
knowledge of, or relationships in, local and regional markets which may give
such competitors advantages in offering services and products that are similar
to those of the Company. Consequently, the Company may encounter significant
competition in its efforts to achieve both its acquisition and internal growth
objectives. There can be no assurance that the Company will be successful
against such competition. See "Business--Competition."

DEPENDENCE ON KEY PERSONNEL

The Company will depend on Gerald R. Leonard, Chairman and Chief Executive
Officer, and Douglas H. Holstein, Chief Operating Officer. In addition, the
Company will rely on many of the executives of each of Merkert and Rogers,
whose reputations and relationships with Manufacturers and Retailers have
contributed in large part to the success of Merkert and Rogers, respectively.
Though the Company will be entering into employment agreements with certain
key executives, there can be no assurance that the Company will be able to
retain the services of such executives or any other management or key sales
personnel. A loss of the services of any of these individuals could have a
material adverse effect on the Company's business, financial condition and
results of operations. See "Business--Business Strategy" and "Management."

SEASONALITY OF OPERATING RESULTS

Each of Merkert and Rogers has experienced and the Company expects to
continue to experience fluctuations in quarterly revenues and operating
results as a result of seasonal patterns. The Company's business is seasonal
in nature, as many Retailers generate relatively lower revenues in January,
February, July and August. As a result, the Company has historically generated
lower revenues in the first and third quarters of the year.

14
<PAGE>

Results of operations for any particular quarter therefore are not necessarily
indicative of the results of operations for any future period. Future seasonal
and quarterly fluctuations could have a material adverse effect on the
Company's business, financial condition and results of operations. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."

YEAR 2000 ISSUES

The Company recognizes the importance of ensuring that its business
operations are not disrupted as a result of Year 2000 related computer system
and software issues. The Company is working with Manufacturers, Retailers and
other parties with which it does business to coordinate Year 2000 conversion
efforts. At the present time, the Company believes that its computer systems
and software are substantially Year 2000 compliant, and it is in the process
of upgrading or replacing those systems that are not compliant. Additionally,
the Company has determined that several PBX (telephone) systems and personal
computers must be replaced, but the Company does not expect Year 2000 issues
to materially affect its products, services, competitive position or financial
performance. However, there can be no assurance that this will be the case. In
addition, the ability of third parties with whom the Company transacts
business to adequately address their Year 2000 issues is outside the Company's
control. Although the Company is working with Manufacturers, Retailers and
other parties, there can be no assurance that the failure of such third
parties to adequately address their respective Year 2000 issues will not have
a material adverse effect on the Company's business, financial condition and
results of operations.

VOTING CONTROL BY DIRECTORS, EXECUTIVE OFFICERS AND PRINCIPAL STOCKHOLDERS

After giving effect to the Offering, the directors and executive officers of
the Company and their affiliates will beneficially own in the aggregate
approximately 28.6% of the outstanding Common Stock (approximately 26.2% if
the Underwriters exercise the over-allotment options in full). This percentage
ownership does not give effect to the exercise of options to purchase 395,000
shares of Common Stock held by or to be granted to certain of these
individuals, which, if exercised in whole or in part, will further concentrate
ownership of the Common Stock. As a result, these stockholders, if they were
to act together, could have the ability, as a practical matter, to
significantly influence the outcome of the election of the Company's directors
and all other matters requiring approval by a majority of the stockholders of
the Company including, in many cases, significant corporate transactions, such
as mergers and sales of all or substantially all of the Company's assets. Such
concentration of ownership, together, in some cases, with certain provisions
of the Company's Amended and Restated Certificate of Incorporation and Amended
and Restated By-laws and certain sections of the Delaware General Corporation
Law, may have the effect of delaying or preventing a "change in control" of
the Company. See "--Anti-takeover Effect of Certificate of Incorporation and
By-law Provisions and Delaware Law," "Management--Directors and Executive
Officers" and "Principal Stockholders."

BENEFITS TO CERTAIN PARTIES

Assuming an initial offering price of $15.00 per share, Monroe & Company II,
LLC, and Gerald R. Leonard will own, upon the consummation of the Offering, in
the aggregate, 1,589,222 shares of Common Stock, which will represent
approximately 22.2% of the outstanding Common Stock following consummation of
the Offering. Of these shares of Common Stock, 260,000 shares are Restricted
Common Stock. Each share of Restricted Common Stock is entitled to 1/10th of
one vote on all matters submitted to the stockholders of the Company. Holders
of Restricted Common Stock will control, in the aggregate, approximately 19.8%
of the votes of all shares of Common Stock outstanding upon consummation of
the Offering. The number of shares of Common Stock held by Monroe & Company
II, LLC, and Gerald R. Leonard will vary if the initial offering price is
greater or less than $15.00 per share. See "Principal Stockholders" and
"Certain Transactions."

ANTI-TAKEOVER EFFECT OF CERTIFICATE OF INCORPORATION AND BY-LAW PROVISIONS AND
DELAWARE LAW

Certain provisions of the Company's Amended and Restated Certificate of
Incorporation and Amended and Restated By-laws, certain sections of the
Delaware General Corporation Law and the ability of the Company's

15
<PAGE>

Board of Directors (the "Board of Directors") to issue shares of preferred
stock and to establish the voting rights, preferences and other terms thereof
may be deemed to have an anti-takeover effect and may discourage takeover
attempts not first approved by the Board of Directors, including takeovers
which certain stockholders may deem to be in their best interests. In
addition, these provisions could delay or frustrate the removal of incumbent
directors or the assumption of control by stockholders, even if such removal
or assumption of control would be beneficial to stockholders. Such provisions
include, among other things, a classified Board of Directors initially serving
staggered two-year terms and eventually three-year terms, the elimination of
the power of the stockholders to act by written consent, the absence of
cumulative voting for directors and certain advance notice requirements for
stockholder proposals and nominations for election to the Board of Directors.
See "Description of Capital Stock--Certain Provisions of Certificate and By-
laws" and "--Statutory Business Combination Provision."

POSSIBLE FUTURE SALES OF SHARES

Sales of substantial amounts of Common Stock in the public market after the
Offering pursuant to Rule 144 under the Securities Act of 1933, as amended
(the "Securities Act"), or otherwise, or the perception that such sales could
occur, may adversely affect prevailing market prices of the Common Stock and
could impair the future ability of the Company to raise capital through an
offering of its equity securities or to effect acquisitions using shares of
its Common Stock. The shares of Common Stock outstanding prior to the Offering
are, and the shares to be issued in the Combination will be, "restricted
securities" within the meaning of Rule 144. Unless the resale of such shares
is registered under the Securities Act (including pursuant to registration
rights granted by the Company (see "Certain Transactions")), these shares may
not be sold in the open market until after the first anniversary of the
transaction in which they were acquired, and then only in compliance with the
applicable requirements of Rule 144. See "Shares Eligible for Future Sale."
The Company, the holders of all shares outstanding prior to the Offering and
all stockholders of Merkert have agreed with the Underwriters (as defined
herein under the caption "Underwriting"), with certain exceptions, not to sell
or otherwise dispose of any shares of Common Stock, or any securities
convertible into or exercisable or exchangeable for shares of Common Stock,
for a period of 180 days after the date of this Prospectus without the written
consent of the Underwriters. These shares generally will be freely tradeable
after their issuance by persons not affiliated with the Company unless the
Company contractually restricts their resale. The Company also intends to
register, soon after the consummation of the Offering, at least 929,500 shares
of Common Stock issuable pursuant to the 1998 Stock Plan. Shares of Common
Stock issued upon the exercise of options under the 1998 Stock Plan after such
registration will be available for sale in the open market, subject to the
Rule 144 and lock-up limitations described above. See "Management--1998 Stock
Option and Incentive Plan," "Certain Transactions," "Shares Eligible for
Future Sale" and "Underwriting."

RESTRICTIONS ON PAYMENT OF DIVIDENDS

Following the consummation of the Offering, the Company intends to retain
earnings to finance the growth and development of its business and does not
anticipate paying cash dividends in the foreseeable future. Declaration of any
future dividends will depend upon, among other things, the Company's results
of operations, financial condition, acquisitions, capital requirements, the
terms and provisions of any debt financing agreements, and general business
condition. See "Dividend Policy" and "Management's Discussion and Analysis of
Financial Condition and Results of Operations--Combined Liquidity and Capital
Resources Following the Combination."

ABSENCE OF PUBLIC MARKET; DETERMINATION OF OFFERING PRICE AND FLUCTUATIONS IN
MARKET PRICE

Prior to the Offering, there has been no public market for the Common Stock.
There can be no assurance that an active trading market will develop after the
Offering or, if developed, that it will be sustained. The initial public
offering price has been determined by negotiation between the Company and the
Representatives and may not be indicative of prices that will prevail in the
trading market after the Offering. Following the Offering, the trading price
of the Common Stock may be subject to significant fluctuations in response to
variations in the annual or quarterly operating results of the Company,
changes in earnings estimates for the Company by

16
<PAGE>

investment analysts, the failure of the Company to meet such estimates or
changes in business or regulatory conditions affecting the Company, its
Manufacturers or Retailers or its competitors. See "Underwriting" for a
description of the factors considered in determining the initial public
offering price.

IMMEDIATE AND SUBSTANTIAL DILUTION TO PURCHASERS IN OFFERING

The initial public offering price is substantially higher than the book
value per share of Common Stock. Accordingly, purchasers in the Offering will
suffer immediate and substantial dilution in the net tangible book value per
share of $(21.67). Additional dilution will occur upon the exercise of
outstanding options to purchase shares of Common Stock granted by the Company
to non-employee members of its Board of Directors and certain of the Company's
employees, including certain members of the Company's management, pursuant to
the 1998 Stock Plan. Under the 1998 Stock Plan, the Company is authorized to
issue options for up to thirteen percent of the number of shares of Common
Stock outstanding from time to time. Upon consummation of the Offering,
929,500 shares of Common Stock will be reserved for issuance under the 1998
Stock Plan (1,015,300 shares of Common Stock will be reserved for issuance
under the 1998 Stock Plan if the Underwriters' over-allotment options are
exercised in full). See "Dilution" and "Management--1998 Stock Option and
Incentive Plan."

THE COMBINATION

The Company was organized in March 1998 and, to date, has conducted
operations only in connection with the Combination and the Offering.
Simultaneously with the consummation of the Offering, the Company will
purchase all of the issued and outstanding capital stock of each of Merkert.
In connection with the Company's purchase of Merkert and Rogers, the Company
will amend and restate its Certificate of Incorporation to, among other
things, increase the Company's authorized shares of Common Stock and authorize
a class of preferred stock, and will declare a stock dividend. Such
transactions are referred to herein collectively as the "Combination." For a
description of the transactions pursuant to which each of Merkert and Rogers
will be acquired by the Company, see "Certain Transactions--Organization of
the Company."

The aggregate consideration to be paid by the Company at the closing of the
Combination is $74.1 million, consisting of approximately $56.6 million in
cash (representing approximately 92.2% of the estimated net proceeds of the
Offering) and 1,166,667 shares of Common Stock (assuming an initial public
offering price of $15.00 per share). If the initial public offering price is
other than $15.00 per share, the number of shares issued to the former
stockholders of Merkert will be increased or decreased so that such
stockholders receive an aggregate of approximately $17.5 million of Common
Stock valued at the initial public offering price. However, the total number
of shares of Common Stock outstanding following the Combination will not vary
as a result of an initial public offering price of other than $15.00 per share
because the size of the stock dividend that will be declared by the Company
prior to the consummation of the Combination will increase as the initial
offering price increases and decrease as the initial offering price decreases.
As a result, upon the consummation of the Combination (but without giving
effect to the Offering), there will be outstanding a total of 2,750,000 shares
of Common Stock. In connection with the Combination, the Company will repay,
in the aggregate, approximately $44.3 million of indebtedness of Merkert and
Rogers from a portion of the net proceeds of the Offering and from borrowings
available under the Term Loan. The consideration to be paid by the Company for
Merkert and Rogers was determined by arm's length negotiations between the
Company and representatives of each of Merkert and Rogers, respectively, and
was based primarily on a percentage of the historical revenues and pro forma
EBITDA (earnings before interest, taxes, depreciation and amortization) of
each of Merkert and Rogers. For a more detailed description of these
transactions, see "Certain Transactions--Organization of the Company."

The stockholders of Merkert will hold approximately 1,166,667 shares of
Common Stock immediately following the Offering and have the right in certain
circumstances to include some or all of their shares of Common Stock in a
registration statement filed by the Company. The Company also intends to
register, soon after the consummation of the Offering, at least 929,500 shares
of Common Stock issuable pursuant to the 1998 Stock Plan. See "Management--
1998 Stock Option and Incentive Plan," "Certain Transactions" and "Shares
Eligible for Future Sale."

17
<PAGE>

USE OF PROCEEDS

The net proceeds to the Company from the sale of the 4,400,000 shares of
Common Stock in the Offering (assuming an initial public offering price of
$15.00 per share), after deducting the underwriting discounts and commissions
and estimated offering expenses payable by the Company, will be approximately
$58.9 million ($68.1 million if the Underwriters' over-allotment option is
exercised in full). Of the net proceeds, approximately $56.6 million will be
used to pay the cash portion of the purchase price for Merkert and Rogers. The
remaining net proceeds of the Offering, which are estimated to be
approximately $2.3 million (excluding the net proceeds resulting from any
exercise of the Underwriters' over-allotment option), together with borrowings
available from the Term Loan portion of the Company's Credit Facility
discussed below, will be used as follows; (i) approximately $14.7 million will
be used to repay certain indebtedness of Merkert and Rogers assumed in
connection with the Combination (which indebtedness bears interest at a
weighted average interest rate of approximately 8.5% and has a weighted
average maturity of less than 1 year), (ii) approximately $29.6 million will
be used to pay certain obligations to certain sellers of previously acquired
businesses (which obligations have a weighted average imputed interest rate of
approximately 9.0% and weighted average maturity of approximately 5 years),
(iii) approximately $500,000 will be used to repay a note payable to Monroe &
Company II, LLC which is attributable to certain of the Company's expenses,
(iv) approximately $5.9 million will be used to fund buyouts of employment
arrangements of certain departing executives of Merkert and Rogers as well as
buyouts of certain consulting arrangements and (v) approximately $ million
will be used to pay expenses incurred by Merkert American Corporation, and
each of Merkert and Rogers and their respective stockholders in connection
with the Combination. The Company expects to use the revolving credit facility
portion of The Credit Facility for general corporate purposes, working capital
requirements.

The Company expects to obtain a commitment for a Credit Facility consisting
of a $50 million term loan and a $25 million revolving credit facility, which
is expected to be available upon the closing of this Offering. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Results of Operations--Combined."

DIVIDEND POLICY

The Company intends to retain earnings to finance the growth and development
of its business and for general corporate purposes, including future
acquisitions, and does not anticipate paying cash dividends in the foreseeable
future. Any payment of cash dividends in the future will be at the discretion
of the Board of Directors and will depend upon the financial condition,
capital requirements and earnings of the Company and such other factors as the
Board of Directors may deem relevant. In addition, the Company may in the
future enter into financing arrangements that may place restrictions on the
Company's ability to pay dividends. See "Management's Discussion and Analysis
of Financial Condition and Results of Operations--Liquidity and Capital
Resources."

18
<PAGE>

CAPITALIZATION

The following table sets forth the short-term and long-term obligations and
capitalization at June 30, 1998 of the Company on a pro forma combined basis
to give effect to: (i) the proposed amendment and restatement of the Company's
Certificate of Incorporation; (ii) a stock dividend of 734.3494 shares of
Common Stock and 144.2802 shares of Restricted Common Stock in respect of each
issued and outstanding share of Common Stock; (iii) the purchase of Merkert
and Rogers by the Company and the sale or distribution of certain real estate
and non-operating assets and liabilities; and (iv) the Offering and the
application of a portion of the estimated net proceeds therefrom. This table
should be read in conjunction with the Unaudited Pro Forma Combined Financial
Statements of the Company and the Notes thereto included elsewhere in this
Prospectus.

<TABLE>
<CAPTION>
AS OF JUNE 30, 1998
---------------------
PRO FORMA AS
COMBINED ADJUSTED(1)
--------- -----------
(DOLLARS IN
THOUSANDS)
<S> <C> <C>
Short-term debt including current portion of long
term debt (2)(3)................................. $45,800 $ 1,500
======= ========
Long-term debt, less current portion ............. $17,066 $ 67,066
------- --------
Stockholders' equity:
Undesignated preferred stock, 1,000,000 shares
authorized none issued or outstanding.......... -- --
Common stock, $.01 par value per share,
54,000,000 authorized shares, 2,750,000 shares
issued and outstanding pro forma, 7,150,000
shares issued and outstanding pro forma as
adjusted (4)................................... 28 72
Additional paid-in capital...................... 14,847 73,683
Retained earnings............................... -- --
------- --------
Total stockholders' equity.................... 14,875 73,755
------- --------
Total capitalization.............................. $31,941 $140,821
======= ========
</TABLE>
- --------
(1) Reflects the consummation of the Offering and the expected application of
the net proceeds therefrom.

(2) For a description of the Company's debt, see the Notes to Unaudited Pro
Forma Combined Financial Statements and the Notes to the Merkert and
Rogers Financial Statements.

(3) Includes $29,600 of acquisition obligations of Merkert and Rogers assumed
to be paid upon the closing of the offering.

(4) Excludes (i) incentive stock options to purchase up to 340,000 shares to
be granted to members of the Company's management upon consummation of the
Offering at an exercise price per share equal to the price to the public
in the Offering, (ii) non-qualified stock options to purchase up to
245,000 shares granted to certain members of the Company's management at
an exercise price of $11.25 per share, the estimated fair market value at
the date of grant, and (iii) options to purchase up to 65,000 shares to be
granted to the Company's Independent Directors upon consummation of the
Offering at an exercise price per share equal to the price to the public
in the Offering. See "Management--1998 Stock Option and Incentive Plan"
and "--Option Grants."

19
<PAGE>

DILUTION
(DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

The deficit in pro forma net tangible book value of the Company at June 30,
1998 was approximately $106.6 million, or $38.77 per share of Common Stock.
The deficit in net tangible book value per share represents the amount of the
Company's stockholders' equity, less the intangible assets, divided by the
number of shares of Common Stock issued and outstanding after giving effect to
the purchase of Merkert and Rogers by the Company. Net tangible book value
dilution per share represents the difference between the amount per share paid
by purchasers of shares of Common Stock in the Offering and the pro forma net
tangible book value per share of Common Stock immediately after completion of
the Offering. After giving effect to the sale of 4,400,000 shares of Common
Stock by the Company in the Offering and the application of the estimated net
proceeds therefrom, the deficit in pro forma net tangible book value of the
Company as of June 30, 1998 would have been $47.7 million or $6.67 per share.
This represents an immediate decrease in the deficit in pro forma net tangible
book value of $32.10 per share to stockholders as of June 30, 1998, and an
immediate dilution in pro forma net tangible book value of $21.67 per share to
purchasers of Common Stock in the Offering. The following table illustrates
the dilution per share:

<TABLE>
<CAPTION>
<S> <C>
Initial public offering price per share........................ $ 15.00
Deficit in pro forma net tangible book value per share before
the Offering................................................ (38.77)
Decrease in deficit pro forma net tangible book value per
share attributable to new investors......................... 32.10
Deficit in pro forma net tangible book value per share after
the Offering.................................................. (6.67)
Dilution per share to new investors............................ $(21.67)
</TABLE>

The following table sets forth, on a pro forma basis to give effect to the
Combination as of June 30, 1998 and after giving effect to the sale of Common
Stock in the Offering at a price of $15.00 per share, the number and
percentage of shares of Common Stock purchased from the Company, the aggregate
cash consideration paid and the average price per share paid to the Company:

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION
----------------- ------------------- AVERAGE PRICE
NUMBER PERCENT AMOUNT PER SHARE
--------- ------- ------------------- -------------
<S> <C> <C> <C> <C>
Existing Stockholders... 2,750,000 38.5% $ 1,500,000 $ 0.55
New Investors........... 4,400,000 61.5% 66,000,000 15.00
--------- ----- -----------
Total................. 7,150,000 100.0% $67,500,000
========= ===== ===========
</TABLE>

20
<PAGE>

SELECTED FINANCIAL DATA FOR MERKERT AND ROGERS
(DOLLARS IN THOUSANDS)

The following selected consolidated statement of income data for each of the
three years ended December 31, 1997 and consolidated balance sheet data at
December 31, 1996 and 1997 are derived from consolidated financial statements
of each of Merkert and Rogers which have been audited by Arthur Andersen LLP,
independent auditors, and are included elsewhere herein. The selected
financial information at December 31, 1995 and for the years ended December
31, 1993 and 1994 for Merkert and October 31, 1993 and 1994 for Rogers are
derived from unaudited financial statements not included herein. The
consolidated income data for the six months ended June 30, 1997 and 1998 and
the consolidated balance sheet data at June 30, 1998 are derived from
unaudited consolidated financial statements also included elsewhere in the
Prospectus. The unaudited consolidated financial statements have been prepared
by each of Merkert and Rogers on a basis consistent with the audited financial
statements of each of Merkert and Rogers and, in the opinion of management,
include all adjustments, consisting only of normal recurring accruals,
necessary for a fair presentation of the consolidated financial position and
results of operations of each of Merkert and Rogers for these periods. The
consolidated results of operations for the six months ended June 30, 1998 are
not necessarily indicative of results for the year ending December 31, 1998 or
any future period. See the Unaudited Pro Forma Combined Financial Statements
and the Notes thereto and the Merkert and Rogers financial statements and the
Notes thereto included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, JUNE 30,
----------------------------------------------- ------------------
1993 1994 1995 1996 1997 1997 1998
------- -------- -------- -------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C>
MERKERT
STATEMENT OF OPERATIONS
DATA
Commissions........... $66,686 $ 68,247 $ 73,336 $ 80,661 $104,274 $ 51,816 $ 46,304
Sales................. 28,582 37,395 49,233 44,916 43,105 20,864 21,537
------- -------- -------- -------- -------- -------- --------
Revenues............. 95,268 105,642 122,569 125,577 147,379 72,680 67,841
Operating income
(loss)(1)............ 713 (329) 2,434 633 1,373 (2,962) (1,448)
Net income (loss)..... (192) (750) (461) (2,074) (3,449) (5,542) (4,144)
OTHER FINANCIAL DATA
EBITDA(2)............. 3,747 2,054 4,566 3,080 5,857 (655) 944
</TABLE>

<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
--------------------------------------- -----------
1993 1994 1995 1996 1997 1998
------- ------- ------- ------- ------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
CONSOLIDATED BALANCE SHEET DATA:
Total Assets............. $28,418 $27,759 $31,425 $47,422 $58,699 $52,949
Long-term debt, less
current maturities...... 3,554 1,508 3,458 15,590 21,278 23,709
Convertible preferred
stock................... 6,360 6,360 6,360 6,360 5,720 5,747
</TABLE>

21
<PAGE>

<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED SIX MONTHS ENDED
OCTOBER 31, DECEMBER 31, JUNE 30,
----------------------- ------------------------ -------------------
1993 1994 1995 1996 1997 1997 1998
----------- ----------- ------- ------- ------- ----------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C>
ROGERS
STATEMENT OF OPERATIONS
DATA
Commissions........... $ 27,365 $ 30,626 $47,496 $63,311 $82,985 $41,053 $41,643
Operating income
(loss)............... 463 816 3,149 107 4,085 649 2,083
Net income (loss)..... 145 13 1,034 (1,089) 745 (540) 450
OTHER FINANCIAL DATA
EBITDA(2)............. 931 1,245 4,222 1,753 6,601 2,057 3,236
<CAPTION>
YEAR ENDED OCTOBER 31, YEAR ENDED DECEMBER 31, JUNE 30,
----------------------- ------------------------ -----------
1993 1994 1995 1996 1997 1998
----------- ----------- ------- ------- ------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C>
CONSOLIDATED BALANCE
SHEET DATA:
Total Assets.......... $ 10,948 $ 13,406 $23,318 $37,761 $38,999 $39,202
Long-term debt, less
current maturities... 5,812 7,093 15,009 28,849 30,830 21,167
</TABLE>
- --------

(1) Includes a restructuring charge of $520 for the second quarter of 1998.

22
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Prospectus contains, in addition to historical information, forward-
looking statements that involve risks and uncertainties. The Company's actual
results could differ significantly from the results discussed in the forward-
looking statements. Factors that could cause or contribute to such differences
include those discussed in "Risk Factors" as well as those discussed elsewhere
in this Prospectus. The following discussion and analysis should be read in
conjunction with the Company's unaudited pro forma combined financial
statements and Merkert's and Rogers' respective financial statements and
related notes thereto presented elsewhere in this Prospectus.

INTRODUCTION

The Company was organized in March 1998 to create a leading food brokerage
firm providing outsourced sales, merchandising and marketing services to
Manufacturers. The Company acts as an independent sales and marketing
representative, selling grocery and consumer products on behalf of
Manufacturers and coordinating the execution of Manufacturers' marketing
programs with Retailers. The Company's principal source of revenue is
commissions it receives from Manufacturers. The Company's other activities
include managing private label programs on behalf of selected Retailers.

To date, the Company has conducted operations only in connection with the
Combination and the Offering and will purchase all of the issued and
outstanding capital stock of Merkert and Rogers in the Combination. Prior to
the Combination, Merkert and Rogers have operated throughout the periods
presented as independent, owned entities. For financial reporting purposes,
the Company is presented as the acquiror of Merkert and Rogers.

Merkert, headquartered in Canton, Massachusetts, was founded in 1950 and is
one of the three largest food brokers in the northeastern United States.
Merkert operates 10 offices throughout New England, New York, and the mid-
Atlantic, from Maine west to Ohio and south to Virginia. Rogers, headquartered
in Charlotte, North Carolina, was founded in 1934 and is one of the three
largest food brokers in the southeastern United States. Rogers operates 20
offices throughout the southeastern and mid-Atlantic United States.

The Company has long-standing relationships with many of its Manufacturers
and represents more than 750 Manufacturers. Industry practice is that food
brokers' relationships with Manufacturers are generally governed by contracts
which are typically terminable by either party upon 30 days' notice. In the
ordinary course of business the Company experiences turnover in these
relationships as a result of Manufacturer conflicts or strategic decisions by
the Company or a Manufacturer. Additionally, the Company currently estimates
that a loss in annual revenues of approximately $5.9 million will be incurred
as a result of Manufacturer conflicts associated with the Combination. There
can be no assurance that additional losses in revenue will not be incurred as
a result of potential Manufacturer conflicts associated with the Combination.

ACQUISITION HISTORY

The food brokerage industry has experienced significant consolidation as the
number of food brokerage firms has decreased from 2,500 to 1,000 over the past
10 years. There are approximately 12 large regional firms, which have emerged
as the result of the consolidation of competitors. A number of the companies
in the food brokerage industry, including Merkert and Rogers, have
participated in the trend towards consolidation by acquiring other food
brokerage businesses, generally financing these transactions with debt and/or
by deferring the payment of a portion of the purchase price.

As part of their business development, both Merkert and Rogers have been
active in pursuing acquisition opportunities. Since 1995, each of Merkert and
Rogers has completed several acquisitions, although their respective
acquisition strategies have resulted in different operational outcomes.

23
<PAGE>

Merkert has focused on larger acquisitions within its existing markets which
have given it the opportunity to consolidate operations and achieve greater
efficiencies. Merkert, based on its analysis of the Manufacturer relationships
of acquisition candidates, selected what it viewed as the strongest on-going
relationships between Manufacturers it represented and Manufacturers
represented by the acquired companies.

Since the beginning of 1995, Merkert has completed five asset acquisitions
of food brokerage companies, including the asset purchases of Food Service
Sales in metropolitan New York (January 1995), ABD Sales, Inc. ("ABD") in
metropolitan New York (October 1996), DelGrosso, Richardson, Morrison, Inc.
("DRM") in the mid-Atlantic region (October 1996), JP Luciano, Inc. and
Luciano Food Brokers, Inc. ("Luciano") in upstate New York (January 1997) and
Toomey-DeLong, Inc. ("T-D") in New England (January 1997). DRM was the only
acquisition outside an existing territory of Merkert.

Merkert has achieved cost savings through the consolidation of its
acquisitions within its existing markets by eliminating duplicative offices
and combining sales and administrative organizations. These acquisitions have
allowed Merkert to further penetrate its existing markets.

Rogers has focused on the expansion of its geographic coverage. Rogers'
acquisitions have generally represented opportunities for entry into new
territories for it. Rogers' acquisition program has been driven by a strategy
designed to ensure that it is capable of representing its most significant
Retailers in all the territories these Retailers serve as they expand.

Since the beginning of 1995, Rogers has completed 10 significant
acquisitions of food brokerage companies including, among others, Clarke &
Wittekind in Tennessee (March 1995), Dopson-Hicks in Florida (November 1995),
G.B.S. (October 1996) and Fitzwater (November 1996) in the mid-Atlantic
region, Sales Support in South Carolina (November 1996) and Marketing
Performance, Inc. in Alabama (November 1996).

As a result of developing new business from existing Manufacturers in new
territories in which it has made acquisitions, Rogers has been able to achieve
significant growth in revenues. Because many of Rogers' acquisitions have been
in new territories, Rogers has not experienced the same degree of cost saving
opportunities through consolidation as Merkert. See "Results of Operations--
Rogers."

RESULTS OF OPERATIONS

The following defined terms are used in conjunction with both Merkert's and
Rogers' discussion of operating results.

Revenues. Revenues are derived mainly from commissions earned from
Manufacturers based on the Manufacturers' invoices to Retailers for products
sold. Commissions are usually expressed as a percentage of the invoice as
agreed by contract between the Manufacturer and broker. Commission rates
typically range from 3% for full brokerage services to 1% for retail-only
services. Merkert also derives revenues, referred to as "Sales," from the sale
of products including private label packaging materials and frozen products,
such as fruits and vegetables, to certain Retailers, and other products for
certain Manufacturers. See "Business-- Services and Operations."

Cost of sales. Cost of sales are primarily the direct cost of private label
products sold by Merkert, such as the cost of packaging and frozen vegetables
purchased from suppliers.

Selling, general and administrative expenses. Selling expenses are
predominately comprised of salaries, fringe benefits and incentives for
personnel directly involved in providing services to Manufacturers and
Retailers. Other selling expenses include, among other things, automobiles
utilized by the sales personnel, promotional expenses, and travel and
entertainment. General and administrative expenses consist primarily of
salaries and fringe benefits for administrative and corporate personnel,
occupancy and other office expenses, information technology, communications
and insurance.

24
<PAGE>

Depreciation and amortization expenses. Depreciation and amortization
expenses relate to intangible assets, including goodwill incurred and
noncompete agreements entered into in connection with the Company's
acquisition program, and property, plant and equipment.

Following the Combination, the Company expects to achieve certain savings as
a result of its consolidation of operations in geographic areas where Merkert
and Rogers both have operations. Certain of these savings are reflected in the
pro forma combined statement of operations.

RESULTS OF OPERATIONS--MERKERT

The following table sets forth the results of operations of Merkert on a
historical basis. The historical results of Merkert discussed below do not
reflect the operations of Rogers or the effect of any pro forma adjustments
(dollars in thousands).

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, SIX MONTHS ENDED JUNE 30,
--------------------------------------------------- -------------------------------
1995 1996 1997 1997 1998
--------------- --------------- --------------- -------------- --------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Commissions............. $ 73,336 $ 80,661 $104,274 $51,816 $46,304
Sales................... 49,233 44,916 43,105 20,864 21,537
-------- ----- -------- ----- -------- ----- ------- ----- ------- -----
Revenues................ $122,569 100.0 % $125,577 100.0 % $147,379 100.0 % $72,680 100.0 % $67,841 100.0%
Cost of sales........... 45,615 37.2 41,890 33.4 39,027 26.5 19,260 26.5 19,591 28.9
Selling expenses........ 45,717 37.3 52,510 41.8 69,913 47.4 37,477 51.6 31,272 46.1
General and
administrative......... 26,671 21.8 28,097 22.4 32,582 22.1 16,598 22.8 15,514 22.9
Depreciation and
amortization........... 2,132 1.7 2,447 1.9 4,484 3.0 2,307 3.2 2,392 3.5
Restructuring Expense... -- -- -- -- -- -- -- -- 520 0.8
-------- ----- -------- ----- -------- ----- ------- ----- ------- -----
Operating income
(loss)................. 2,434 2.0 633 0.5 1,373 0.9 (2,962) (4.1) (1,448) (2.1)
Interest income......... -- -- -- -- -- -- 24 0.0 -- --
Interest expense........ 1,660 1.4 2,283 1.8 5,010 3.4 (2,393) (3.3) (2,356) (3.5)
Other income (expense).. (33) 0.0 (380) (0.3) (79) (0.1) (53) (0.1) (240) (0.4)
-------- ----- -------- ----- -------- ----- ------- ----- ------- -----
Income (loss) before
income taxes........... 807 0.7 (1,270) (1.0) (3,558) (2.4) (5,384) (7.4) (4,044) (6.0)
Provision (benefit) for
income taxes........... 1,268 1.0 804 0.6 (109) (0.1) 158 0.2 100 0.1
-------- ----- -------- ----- -------- ----- ------- ----- ------- -----
Net income (loss)....... (461) (0.4) (2,074) (1.7) (3,449) (2.3) (5,542) (7.6) (4,144) (6.1)
Preferred stock
dividend............... 445 0.4 445 0.4 445 0.3 223 0.3 200 0.3
-------- ----- -------- ----- -------- ----- ------- ----- ------- -----
Net income applicable to
common stockholders.... $ (906) (0.7)% $ (2,519) (2.0)% $ (3,894) (2.6)% $(5,765) (7.9)% $(4,344) (6.4)%
======== ===== ======== ===== ======== ===== ======= ===== ======= =====
</TABLE>
- --------
Note: Merkert derives its Sales primarily from sales of private label
products, price marking devices and bio-degreasers. Cost of Sales is directly
related to this activity. Selling expenses relate to Merkert's commission
revenues.

Merkert results for the first six months of 1998 compared to the first six
months of 1997:

Revenues. Revenues decreased by $4.8 million, or 6.7%, from $72.7 million in
the first half of 1997 to $67.8 million in the first half of 1998. Revenues
from commissions decreased by $5.5 million, or 10.6%, from $51.8 million in
the first half of 1997 to $46.3 million in the first half of 1998.
Approximately half of such decrease in revenues from commissions is due to the
impact of a discontinued retail merchandising operation, which had been
established in 1995 to serve one specific Retailer that was shut down in
October 1997. The balance of the decrease in revenues from commissions is due
to lost business, including the resolution of manufacturer conflicts arising
from prior acquisitions and the loss of one major Manufacturer that switched
to retail-only brokerage service in 1997, but has since returned to a hybrid
brokerage service relationship in 1998. Sales of products increased by $0.7
million, or 3.2%, from $20.9 million in the first half of 1997 to $21.5
million in the first half of 1998, primarily as the result of increased demand
by a major customer of private label frozen foods.

25
<PAGE>

Selling, general and administrative expenses. Selling, general and
administrative expenses decreased by $7.3 million, or 13.5%, from $54.1
million in 1997 to $46.8 million in 1998, primarily due to reductions in
personnel associated with synergies achieved from the acquisitions in
overlapping geographic areas which were made in late 1996 and early 1997.
Expenses also decreased due to the non-reoccurrence of severance and other
costs incurred in 1997 associated with the integration of prior acquisitions.
As a percentage of revenues, selling, general and administrative expenses
decreased from 74.4% in the first half of 1997 to 69.0% in the first half of
1998. Merkert's practice with respect to acquisitions is to achieve
efficiencies through the reduction of costs associated with redundant
administrative and other functions and the leveraging of Merkert's information
technology, purchasing power and other strengths.

Restructuring expense. The first half results for 1998 reflect restructuring
expenses of $0.5 million, of which $0.4 million is accrued at June 30, 1998
with no corresponding charge in the first half of 1997. These expenses relate
to severance costs associated with elimination of 64 positions. The Company
anticipates taking further actions in 1998 which will result in further
restructuring charges.

Depreciation and amortization. Depreciation and amortization expenses were
substantially unchanged from the first half of 1997 to the first half of 1998.

Interest expense. Interest expense was substantially unchanged from the
first half of 1997 to the first half of 1998.

Income (loss) before income taxes. The loss before income taxes decreased by
$1.3 million, or 24.9%, from ($5.4 million) in the first half of 1997 to ($4.0
million) in the first half of 1998 mainly due to the benefits derived from the
payroll reduction discussed above, partially offset by reductions in revenues
and the restructuring charge noted above.

Provision (benefit) for income taxes. The provision for income taxes
remained consistent between the first half of 1997 and the first half of 1998.

Net income (loss). The net loss decreased by $1.4 million, or 25.2%, from
($5.5 million) in the first half of 1997 to ($4.1 million) in the first half
of 1998 mainly due to the benefits derived from the payroll reductions
discussed above. Such benefits were partially offset by reductions in
revenues.

Preferred stock dividends. The amount payable in respect of preferred stock
dividends remained unchanged between the periods.

Net income (loss) applicable to common stockholders. The loss decreased from
$5.8 million to $4.3 million, or 24.6%, mainly due to the benefits derived
from the payroll reductions discussed above.

Merkert results for 1997 compared to 1996:

Revenues. Revenues increased by $21.8 million, or 17.4%, from $125.6 million
in 1996 to $147.4 million in 1997. Revenues from commissions increased by
$23.6 million, or 29.3% from $80.7 million to $104.3 million, substantially
all of which is attributable to acquisitions consummated in late 1996 and
early 1997 net of account resignations associated with product conflicts
related to the acquired companies. Sales of products decreased by $1.8
million, or 4.0%, from $44.9 million in 1996 to $43.1 million in 1997
primarily as a result of a major Retailer choosing to manage its private label
frozen vegetable program internally in the fourth quarter of 1996.

Selling, general and administrative expenses. Selling expenses, principally
related to payroll, auto and related costs, increased by $17.4 million, or
33.1%, from $52.5 million in 1996 to $69.9 million in 1997 due to increased
personnel associated with the acquisitions. General and administrative
expenses increased by $4.5 million, or 16.0%, from $28.1 million in 1996 to
$32.6 million in 1997 also due principally to costs associated with the full
year effect of the acquisitions. Such expenses were offset, in part, by
savings relating to the integration of such acquisitions.

1997 was devoted to the integration of these acquisitions into Merkert's
operating system. Included in these activities was the reduction of selling,
general and administrative expenses in connection with Merkert's

26
<PAGE>

metropolitan New York operations. The Boerner Division, which operated as one
of three separate Merkert divisions in the metropolitan New York area
following the ABD acquisition, was merged into Merkert's remaining two
metropolitan New York divisions. Additionally, Merkert undertook staff
reductions in the mid-Atlantic region in response to competitive conditions.

Annualized payroll was reduced by $12.0 million, or 18.5%, from $65.0
million in January 1997 to $53.0 million in December 1997 as a result of these
efforts as well as the discontinuation of the merchandising operation. As the
changes were made over the course of the year, the historical periods do not
reflect the full effect of the implementation of these cost-saving
initiatives. Selling, general and administrative expenses in 1997 also reflect
the impact of approximately $1.0 million of restructuring costs associated
with severance of personnel and the elimination of duplicative offices as a
result of these acquisitions.

Depreciation and amortization. Depreciation and amortization increased by
$2.0 million, or 83.2%, from $2.4 million in 1996 to $4.5 million in 1997,
primarily as a result of the amortization of goodwill and other intangible
assets associated with acquisitions.

Interest expense. Interest expense increased by $2.7 million from $2.3
million in 1996 to $5.0 million in 1997, due mainly to interest expense
related to obligations to sellers in connection with acquisitions. Interest
expense associated with the revolving line of credit and Merkert's real estate
mortgage increased by $0.6 million due to increased borrowings to fund working
capital as well as a new corporate headquarters which was completed late in
1997.

Income (loss) before income taxes. The loss before income taxes increased by
$2.3 million from ($1.3) million in 1996 to ($3.6) million in 1997, mainly due
to the effects of the charges for amortization and interest associated with
the acquisitions.

Provision (benefit) for income taxes. Provision for income taxes represented
a benefit of ($0.1) million in 1997 versus a $0.8 million provision in 1996.
The 1996 provision resulted from an increase in the valuation allowance of
$1.6 million for deferred tax assets not likely to be realized, as well as to
permanent non-deductible expenses, principally related to travel and
entertainment expenses.

Net income (loss). The net loss increased by $1.4 million, or 66.3%, from
($2.1) million in 1996 to ($3.4) million in 1997 due to the significant
increase in acquisition-related amortization, interest expense and other
factors as discussed above.

Preferred stock dividends. Preferred stock dividends paid to participants in
the Merkert Enterprises, Inc. Employee Stock Ownership Plan (the "ESOP")
totalled $0.4 million in 1996 and 1997. These dividends are a direct charge to
retained earnings and do not impact the net loss as reported.

Net income (loss) applicable to common stockholders. The net loss applicable
to common stockholders increased by $1.4 million, or 54.6%, from ($2.5)
million in 1996 to ($3.9) million in 1997 as "Net income (loss)" and "Net
income (loss) available to common stockholders" differ only by the direct
retained earnings charge for the preferred stock dividend.

Merkert results for 1996 compared to 1995:

Revenues. Revenues increased by $3.0 million, or 2.5%, from $122.6 million
in 1995 to $125.6 million in 1996. Revenues from commissions increased by $7.3
million, or 10.0%, from $73.3 million in 1995 to $80.7 million in 1996
primarily resulting from acquisitions consummated in late 1996, including ABD
in New York and DRM in the mid-Atlantic region. These acquisitions represent
82% of the increase. Internal growth represents the balance of the increase.
Sales of products decreased by $4.3 million, or 8.8%, from $49.2 million in
1995 to $44.9 million in 1996 primarily as a result of the loss of a private
label frozen vegetable program due to a major Retailer choosing to manage
their program internally.

Selling, general and administrative expenses. Selling expenses principally
related to payroll, auto and related costs, increased by $6.8 million, or
14.9%, from $45.7 million in 1995 to $52.5 million in 1996 due to

27
<PAGE>

increased personnel associated with the acquisitions. General and
administrative expenses increased by $1.4 million, or 5.3%, in 1995 to $28.1
million in 1996 also due principally to costs associated with the acquisitions
in the fourth quarter of 1996. As a percentage of revenue, selling, general
and administrative expenses increased from 59.1% in 1995 to 64.2% of revenue
in 1996.

Depreciation and amortization. Depreciation and amortization increased by
$0.3 million, or 14.8%, from $2.1 million in 1995 to $2.4 million in 1996,
largely due to the amortization of goodwill and other intangible assets
associated with the acquisitions.

Interest expense. Interest expense increased by $0.6 million, or 37.5%, to
$2.3 million in 1996, due mainly to interest expense associated with Merkert's
revolving line of credit to fund working capital.

Income (loss) before income taxes. The loss before taxes decreased by $2.1
million from income before taxes of $0.8 million in 1995 to a loss before
income taxes of ($1.3) million in 1996 mainly due to the effects of the
additional operating costs associated with the acquisitions.

Provision (benefit) for income taxes. The provision for income taxes
decreased by $0.5 million from $1.3 million in 1995 to $0.8 million in 1996.
The 1996 provision, despite the loss before income taxes, is due to the $1.1
million increase in the valuation allowance.

Net income (loss). Net loss increased by $1.6 million from ($0.5) million in
1995 to ($2.1) million in 1996.

Preferred stock dividends. The required dividend was $0.4 million in both
periods.

Net income (loss) applicable to common stockholders. The loss applicable to
common stockholders was $0.9 million in 1995 and $2.5 million in 1996.

LIQUIDITY AND CAPITAL RESOURCES -- MERKERT

At June 30, 1998, Merkert's working capital deficit was $(25.0) million,
compared to $(25.0) million and $(17.4) million at December 31, 1997 and 1996,
respectively. Merkert's principal capital requirements are to fund its
obligations to sellers in connection with its previous acquisitions, its
working capital and its obligation relating to income taxes payable.
Historically, these requirements were met by cash flows generated from
operations and borrowings under bank credit facilities. As of June 30, 1998,
Merkert was not in compliance with certain financial covenants under its
revolving line of credit agreement and was in default with the agreement.
Merkert financed such acquisitions, in part, with debt and/or by deferring the
payment of a portion of the purchase price. The Company expects to use a
portion of the Term Loan to repay certain of Merkert's acquisition-related
obligations. Primarily as a result of such obligations, as well as a
substantial tax liability, Merkert has experienced losses and a working
capital deficit in recent years. The stockholders of Merkert have agreed to
pay such tax liability from cash otherwise payable to them in connection with
the Combination. After giving effect to the Offering and the expected
application of the net proceeds therefrom and the expected application of the
Term Loan proceeds, the Company will not have a working capital deficit. See
"Risk Factors--Merkert Enterprises, Inc.--History of Losses."

Net cash provided by (used in) operating activities for the first half of
1998 and the three years ended 1997, 1996 and 1995 were $(1.8) million, $3.5
million, $4.1 million and $6.2 million, respectively. The 1998 change was
principally due to cash outflows from the net loss offset by the non-cash
depreciation and amortization charges. The changes in cash from operations in
1997, 1996, and 1995 were due to decreases in accounts receivable resulting
from improved collections and increases in accounts payable and accrued
expenses associated with Merkert's higher operating volume.

Net cash provided by (used in) investing activities for the first half of
1998 and the three years ended 1997, 1996 and 1995 were $0.0 million, $(7.3)
million, $(4.7) million and $(1.3) million, respectively. Additions to
property, plant and equipment, including a new corporate headquarters
completed in late 1997, were $7.3 million, $3.4 million and $1.4 million in
1997, 1996 and 1995, respectively. Initial cash payments for acquisitions were
$0.7 million and $1.4 million in 1997 and 1996, respectively.

Net cash provided by (used in) financing activities for the first half of
1998 and the three years ended 1997, 1996 and 1995 were $1.3 million, $3.9
million, $(0.5) million and $(2.8) million, respectively. The 1998 cash

28
<PAGE>

provided by financing activities relates to the refinancing of the mortgage
debt in February 1998, partially offset by payments on notes payable
associated with prior acquisitions made by Merkert. The 1997 cash provided by
financing activities relates to borrowings under Merkert's credit facility to
fund working capital of $4.5 million and increases in the mortgage of $3.4
million to fund the construction of Merkert's new corporate

headquarters, offset by payments on notes payable of $2.5 million, $0.6
million of redemptions of preferred stock from the ESOP and stock repurchases
from former officers of Merkert of $1.5 million. Merkert's working capital
credit facility is expected to be paid in full with a portion of the Term
Loan. 1996 and 1995 cash provided by financing activities relates primarily to
the repurchase of stock and repayment of notes payable.

RESULTS OF OPERATIONS--ROGERS

The following table sets forth the results of operations of Rogers on a
historical basis. The historical results of Rogers discussed below do not
reflect the operations of Merkert or the effect of any pro forma adjustments
(dollars in thousands).

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, SIX MONTHS ENDED JUNE 30,
--------------------------------------------- -------------------------------
1995 1996 1997 1997 1998
------------- -------------- ------------- -------------- --------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Commissions............. $47,496 100.0% $63,311 100.0 % $82,985 100.0% $41,053 100.0 % $41,643 100.0 %
Selling expenses........ 35,817 75.4 50,614 79.9 63,361 76.3 32,403 78.9 31,785 76.3
General and
administrative......... 7,457 15.7 10,944 17.3 13,023 15.7 6,593 16.1 6,622 15.9
Depreciation and
amortization........... 1,073 2.3 1,646 2.6 2,516 3.0 1,408 3.4 1,153 2.8
------- ----- ------- ----- ------- ----- ------- ----- ------- -----
Operating income
(loss)................. 3,149 6.6 107 0.2 4,085 5.0 649 1.6 2,083 5.0
Interest expense........ 1,176 2.4 1,656 2.6 2,536 3.1 (1,387) (3.4) (1,294) (3.1)
Other income (expense).. -- -- -- -- -- -- -- -- 120 0.3
------- ----- ------- ----- ------- ----- ------- ----- ------- -----
Income (loss) before
income taxes........... 1,973 4.2 (1,549) (2.4) 1,549 1.9 (738) (1.8) 909 2.2
Provision (benefit) for
income taxes........... 939 2.0 (460) (0.7) 804 1.0 (198) (0.5) 459 1.1
------- ----- ------- ----- ------- ----- ------- ----- ------- -----
Net income (loss)....... $ 1,034 2.2% $(1,089) (1.7)% $ 745 0.9% $ (540) (1.3)% $ 450 1.1 %
======= ===== ======= ===== ======= ===== ======= ===== ======= =====
</TABLE>

Rogers results for the first six months of 1998 compared to the first six
months of 1997:

Revenues. Commission revenues increased by $0.6 million, or 1.4%, from $41.1
million in the first half of 1997 to $41.6 million in the first half of 1998
due to growth from both business gained from Manufacturers not previously
represented by Rogers and from expansion of business with Manufacturers
already represented by Rogers.

Selling, general and administrative expenses. Selling, general and
administrative expenses decreased by $0.6 million, or 1.5%, from $39.0 million
in 1997 to $38.4 million in 1998 due to cost savings achieved through the
integration of acquisitions.

Depreciation and Amortization. Depreciation and amortization decreased by
$0.3 million, or 18.1%, due to fully amortized intangible assets reductions in
corresponding reductions in the goodwill associated with prior acquisitions.

Interest. Interest expense decreased by $0.1 million, or 6.7%, from $1.4
million in the first half of 1997 to $1.3 million in the first half of 1998
due to reductions in debt resulting from prior acquisitions.

Income (loss) before income taxes. Income before income taxes increased by
$1.6 million from a loss of ($0.7 million) in the first half of 1997 to income
of $0.9 million in the first half of 1998 due to the increase in commissions,
the decrease in selling general and administrative expense and the decreases
in amortization and interest expense discussed above.

Provision (benefit) for income taxes. The provision for income taxes
increased by $0.7 million from a benefit of ($0.2 million) in 1997 to a
provision of $0.5 million in 1998 due to the increase in income before income
taxes discussed above.

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<PAGE>

Net income (loss). Net income increased by $1.0 million, from a loss of
($0.5 million) in the first half of 1997 to income of $0.5 million in the
first half of 1998 due to the increase in commissions, the decrease in selling
general and administrative expense and the decreases in amortization and
interest expense discussed above.

Rogers results for 1997 compared to 1996:

Revenues. Commission revenues increased by $19.7 million, or 31.1%, from
$63.3 million in 1996 to $83.0 million in 1997. Approximately $13.0 million of
the increase is due to acquisitions made in late 1996, mainly in the mid-
Atlantic region (Fitzwater and G.B.S.). The balance of the increase, $6.7
million, is due to revenue growth from both new Manufacturers and existing
Manufacturers represented. This represents an internal growth rate of 10.6%
and is largely attributable to the development of Manufacturer relationships
in newly acquired regions, including significant growth in Florida.

Selling, general and administrative expenses. Selling expenses, principally
related to payroll, auto and related costs, increased by $12.8 million, or
25.2%, from $50.6 million for 1996 to $63.4 million for 1997, due to temporary
increases in staffing levels associated with acquisitions. General and
administrative expenses increased by $2.1 million or 19.0% from $10.9 million
in 1996 to $13.0 million in 1997 also due principally to increased costs
associated with acquisitions. Salaries and related expenses declined as a
percentage of commission revenues from 66.1% in 1996 to 61.0% in 1997 due to
the continuing integration of acquisitions into Rogers and related synergies
coupled with improved utilization of existing personnel relating to the
internal growth.

Depreciation and amortization. Depreciation and amortization increased by
$0.9 million, or 52.9%, from $1.6 million in 1996 to $2.5 million in 1997 due
to the amortization of goodwill and other intangible assets associated with
the acquisitions.

Interest expense. Interest expense increased by $0.8 million, or 53.1%, from
$1.7 million in 1996 to $2.5 million in 1997, due mainly to continuing
principal payments on obligations to sellers in connection with acquisitions.
Interest expense associated with Rogers' revolving line of credit increased by
$0.4 million due to increased borrowings to fund Rogers' working capital.

Income (loss) before taxes. Income before taxes increased by $3.0 million
from a loss of ($1.5) million in 1996 to income of $1.5 million in 1997.

Provision (benefit) for income taxes. Provision for income taxes increased
by $1.3 million from a benefit of ($0.5) million in 1996 to a provision of
$0.8 million in 1997. This increase results from the corresponding increase in
income before taxes.

Net income (loss). Net income increased by $1.8 million from a loss of
($1.1) million in 1996 to income of $0.7 million in 1997. This increase is a
result of the corresponding increase in income before taxes.

Rogers results for 1996 compared to 1995:

Revenues. Commission revenue increased by $15.8 million, or 33.3%, from
$47.5 million in 1995 to $63.3 million for 1996. Approximately $11.0 million
of the growth was due to acquisitions made in 1995 including Dopson-Hicks and
Clarke & Wittekind. The balance of the increase, $4.8 million, is due to
growth from both business gained from Manufacturers not previously represented
by Rogers and from expansion of business with Manufacturers already
represented by Rogers. This represents an internal growth rate of 10.1%.

Selling, general and administrative expenses. Selling expenses, principally
related to payroll, auto and related costs increased $14.8 million, or 41.3%,
from $35.8 million for 1995 to $50.6 million for 1996 due to increased
personnel associated with the acquisitions. General and administrative
expenses increased by $3.4 million, or 46.8%, from $7.5 million in 1995 to
$10.9 million in 1996 also due principally to increased costs associated with
acquisitions. Salaries and related expenses increased as a percentage of
commission revenues from 63.8% in 1995 to 66.1% in 1996.

30
<PAGE>

Depreciation and amortization. Depreciation and amortization increased by
$0.5 million, or 45.5%, from $1.1 million in 1995 to $1.6 million in 1996
largely due to the amortization of goodwill and other intangible assets
associated with the acquisitions.

Interest expense. Interest expense increased by $0.5 million, or 41.7%, from
$1.2 million in 1995 to $1.7 million in 1996 due mainly to interest expense
incurred on the payment of obligations to sellers in connection with
acquisitions.

Income (loss) before taxes. Income before taxes decreased by $3.5 million
from income of $2.0 million in 1995 to a loss of ($1.5) million in 1996. This
decrease is due to a substantial increase in payroll relating to the
assumption of personnel in acquisitions as well as additions to administrative
and other support personnel to support Rogers' rapid growth.

Provision (benefit) for income taxes. Provision for income taxes decreased
by $1.4 million from a provision of $0.9 million in 1995 to a benefit of
($0.5) million in 1996. This decrease is a result of the corresponding
decrease in income before taxes.

Net income (loss). Net income decreased by $2.1 million from $1.0 million in
1995 to a loss of ($1.1) million in 1996. This decrease is a result of the
corresponding decrease in income before taxes.

LIQUIDITY AND CAPITAL RESOURCES -- ROGERS

At June 30, 1998, Rogers' working capital (deficit) was $(5.1) million,
compared to $3.1 million and $(4.7) million at December 31, 1997 and 1996.
Rogers' principal capital requirements are to fund its obligations with
respect to acquisitions and its working capital requirements. Historically,
these requirements have been met by cash flows generated from operations and
borrowings under bank credit facilities. The June 30, 1998 deficit is due to
the classification of Rogers' borrowings of $9.4 million under its revolving
line of credit as a current liability, because the term expires on January 31,
1999. This debt is expected to be repaid with a portion of the Term Loan.

Net cash provided (used) by operating activities for the first half of 1998
and the three years ended 1997, 1996 and 1995 were $0.0 million, $(0.9)
million, $0.2 million, and $5.3 million, respectively. The changes were
principally due to increases in working capital associated with the growth in
commission revenues.

Net cash provided (used) in investing activities for the first half of 1998
and the three years ended 1997, 1996 and 1995 were $(0.1) million, $(1.4)
million, $(12.8) million and $(12.5) million, respectively. Payments for
acquisitions were $11.2 million and $11.6 million in 1996 and 1995,
respectively. Additions to property, plant and equipment and increases in the
cash surrender value of life insurance accounted for the balance of the
activity.

Net cash provided (used) by financing activities for the first half of 1998
and the three years ended 1997, 1996 and 1995 were $(0.3) million, $2.2
million, $13.1 million and $7.2 million, respectively. The 1998 and 1997
activity related to net borrowings (repayments) under Rogers' credit facility
to fund working capital was $4.5 million and $1.2 million, respectively.
Rogers' credit facility is expected to be paid in full with a portion of the
Term Loan. In 1996 and 1995, obligations to sellers of $10.2 million and $7.9
million, respectively, were incurred in connection with acquisitions.

COMBINED LIQUIDITY AND CAPITAL RESOURCES FOLLOWING THE COMBINATION

At June 30, 1998, the combined working capital deficit of Merkert and Rogers
was $(30.1) million. Following the completion of the Offering and the
application of the net proceeds therefrom, the Company will have working
capital of approximately $2.7 million. See the Unaudited Pro Forma Combined
Financial Statements and Notes thereto presented elsewhere in this Prospectus.
The Company anticipates that its cash flow from operations, cash on hand and
anticipated borrowings available under the Revolving Credit (as defined below)
will provide cash sufficient to satisfy the Company's working capital needs,
debt service requirements and planned capital expenditures for at least the
next 12 months.

31
<PAGE>

The Company expects to incur up to $11.1 million in integration costs
associated with the Combination of which approximately $3.3 million will be
paid prior to the closing of the Offering by Merkert and Rogers, approximately
$1.5 million of which will be paid with a portion of the proceeds at the
Offering and the remainder will be paid subsequent to the Offering.

On a combined basis, Merkert and Rogers used $1.8 million of net cash from
operating activities for the first half of 1998 due to the effect of operating
losses at Merkert. On a combined basis, cash flows from financing activities
were $1.0 million for the first half of 1998 due to borrowing activity at
Merkert.

The Company expects to obtain a commitment for a credit facility (the
"Credit Facility") consisting of a $50 million term loan (the "Term Loan") and
a $25 million revolving line of credit (the "Revolving Credit"), which is
expected to be available upon the closing of this Offering. Together with the
net proceeds of the Offering, the Company expects to use the Credit Facility
to (i) repay approximately $14.7 million of indebtedness of Merkert and Rogers
assumed in connection with the Offering, (ii) pay approximately $29.6 million
of obligations to certain sellers of previously acquired businesses, (iii)
repay approximately $500,000 outstanding under a promissory note payable to
Monroe & Company II, LLC which is attributable to certain of the Company's
expenses, (iv) fund approximately $5.9 million of buyouts of employment
arrangements of certain departing executives of Merkert as well as buyouts of
certain consulting arrangements and (v) pay approximately $ million of
expenses incurred by Merkert American Corporation, and each of Merkert and
Rogers and their respective stockholders in connection with the Combination.
The Credit Facility will be subject to the completion of customary loan
documentation.

The Company intends to pursue acquisition opportunities and expects to fund
future acquisitions through the issuance of additional Common Stock, debt or
equity financings and cash flow from operations.

The Company is obligated to make payments to the sellers of certain
businesses acquired by Merkert and Rogers. In addition, the Company is
obligated to make payments relative to the mortgage on the Merkert
headquarters. The Company estimates the total principal and interest payments
under these various obligations will be approximately $1.2 million over each
of the next two years, decreasing to approximately $1.1 million over each of
the three succeeding years. A portion of the Term Loan is expected to be used
to repay, prior to their scheduled maturities, obligations of Merkert and
Rogers to certain sellers of previously acquired businesses. The $9.3 million
mortgage, which is a twenty year obligation at an interest rate of 8.56%, does
not contain any financial covenants, but prohibits prepayment. The mortgage is
payable in equal monthly installments over its life.

Merkert currently has in place an $8.5 million revolving line of credit (the
"Merkert Facility") which is scheduled to expire on February 1, 1999.
Borrowings under the Merkert Facility bear interest at the lender's base
lending rate. The terms of the Merkert Facility include certain negative
covenants which include, without limitation, prohibitions on selling or
otherwise disposing of material assets, incurring additional debt, and other
customary negative covenants. Borrowings under the Merkert Facility are
secured by a continuing security interest in Merkert's accounts receivable and
all other debts, obligations and liabilities owing to Merkert.

Rogers currently has in place a $10.0 million revolving credit facility (the
"Rogers Facility") which is scheduled to expire on January 31, 1999.
Borrowings under the Rogers Facility bear interest at the lower of: (i) the
lender's one-month LIBOR index plus 2.70% and (ii) the lender's prime lending
rate. The terms of the Rogers Facility include certain negative covenants
which include, without limitation, restrictions on changes in ownership of
Rogers, creation of liens on Rogers' assets, merger and acquisition
transactions, dispositions of assets, and other customary negative covenants.
Borrowings under the Rogers Facility are secured by a lien on Rogers' accounts
receivable and a second mortgage on its corporate headquarters.

Upon the consummation of the Offering, the Company expects to use a portion
of the Term Loan to repay all of the outstanding indebtedness of Merkert and
Rogers under the Merkert Facility and the Rogers Facility. See "Use of
Proceeds."

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<PAGE>

The Company estimates that its ongoing requirements for capital
expenditures, based on the requirements of Merkert and Rogers, will be
approximately $2.0 million per year. Capital expenditures will be made to
ensure that the Company maintains its strong position in information
technology and systems and anticipates that significant capital will be
required to upgrade and integrate the systems of companies acquired in the
future. On a combined basis, Merkert and Rogers made capital expenditures of
$1.5 million in 1997, exclusive of $5.5 million for the construction of a new
corporate headquarters for Merkert.

SEASONALITY; FLUCTUATIONS IN QUARTERLY OPERATING RESULTS

Merkert and Rogers have both experienced, and the Company expects to
continue to experience, fluctuations in quarterly revenues and operating
results as a result of seasonal patterns. Rogers' business has been stronger
in the first calendar quarter compared to Merkert due to its presence in
Florida; while Merkert's business has been stronger in the fourth calendar
quarter as a result of the historically strong sales in the northeast
associated with the holiday season.

Quarterly results may also be impacted by the timing of any future
acquisitions as well as the timing of any consolidation activities undertaken.
The Company's revenues may also be adversely impacted by disruptions in food
production by Manufacturers it represents, particularly as it relates to
weather dependent production, such as fresh produce.

INFLATION

The Company does not believe that its revenues have been materially affected
by inflation.

33
<PAGE>

BUSINESS

OVERVIEW

The Company was organized in March 1998 to create a leading food brokerage
firm providing outsourced sales, merchandising and marketing services to
Manufacturers. The Company acts as an independent sales and marketing
representative, selling grocery and consumer products on behalf of
Manufacturers and coordinating the execution of Manufacturers' marketing
programs with Retailers. The Company's principal source of revenues is
commissions that it receives from Manufacturers. The Company's other
activities include managing private label programs on behalf of selected
Retailers.

The Company has long-standing relationships with many of its Manufacturers,
including Dean Foods/Birds Eye (41 years), H.J. Heinz (24 years), Minute Maid
(44 years), Ocean Spray (29 years) and Pillsbury (19 years). Key Retailer
relationships include C&S Wholesale Grocers, Inc., Food Lion Supermarkets,
Hannaford Brothers, Kroger, Publix Supermarkets, Royal Ahold (including Stop &
Shop, Bi-Lo and Giant Food), Safeway, Wakefern (Shop Rite), and Winn-Dixie.
The Company represents more than 750 Manufacturers and more than 70,000 food
and non-food stock-keeping units ("SKUs"), and does business with key
Retailers in 22 states.

Since 1994, Merkert and Rogers have acquired and integrated 21 companies,
successfully adding coverage of new geographic markets and expanding
representation of Manufacturers' product offerings within existing markets.
The Company's strategic acquisition plan includes the selection, acquisition
and management of businesses in brokerage market segments, including the
retail food brokerage, food service brokerage and private label brokerage
market segments.

The Company will be the first publicly held food broker in the United
States. The Company is the only food broker with comprehensive geographic
coverage of the eastern United States and the capability to provide service to
the region's largest Retailers. The eastern United States is the most highly
concentrated retail store region in the United States and represents
approximately 43% of national food store sales. The Company has 30 offices
serving Retailers in 22 states. In 1997, the Company had pro forma combined
revenue of approximately $230.4 million and pro forma combined net income of
approximately $0.2 million.

INDUSTRY OVERVIEW

The Company estimates, based on information published by industry sources,
that the food brokerage industry in the United States had annual commission
revenues of approximately $6 billion in 1997. A portion of such revenues were
earned in connection with retail merchandising activities. According to
industry sources, the retail merchandising industry in the United States had
annual revenues of approximately $11.7 billion (exclusive of retail
merchandising revenues in the food brokerage industry) in 1997. Food brokers
serve Manufacturers, Retailers and food service providers. Retail food brokers
represent approximately 3,200 Manufacturers that sell to approximately 128,000
Grocery Stores and more than 700 wholesalers nationwide. The industry includes
three types of food brokers, as follows:

34
<PAGE>

developing, reviewing and executing annual marketing plans. Other headquarters
services include order management, supervision of shelf space management,
coordination of Manufacturers' promotional spending, and facilitating the
resolution of billing issues between Manufacturers and Retailers. In
connection with the implementation of category management at the Retailers'
headquarters level, retail food brokers assist Retailers by gathering and
analyzing demographic, consumer, and store sales information utilized in the
management of product categories as strategic business units.

Retail store functions generally include execution of sales plans for
Manufacturers' products at the store level by assisting in merchandising,
shelf and display management, new store set-ups, implementation of promotional
plans, and placement of point-of-sale coupons, signs and other information.
Retail food brokers also assist Retailers with coupon and advertising
programs, quality assurance and technical training (primarily in relation to
prepared foods). In addition, retail food brokers assist Retailers and
Manufacturers in the collection, analysis and application of retail sales
data.

The retail food brokerage industry has been growing as food brokers
represent an increasing percentage of the volume of all commodities sold
through Grocery Stores (the "ACV"). In 1997, the percentage of ACV sold
through Grocery Stores was approximately 55% compared to 45% in 1985.
According to Progressive Grocer, Grocery Store revenues, of which an
increasing portion is represented by food brokers, are generally not adversely
affected by economic downturns and have grown from approximately $292 billion
in 1985 to $436 billion in 1997.

The Company believes that the retail food brokerage industry is highly
fragmented and is experiencing significant consolidation. In the past 10
years, the number of food brokerage firms has decreased from 2,500 to 1,000,
while the number of sales representatives employed by such firms increased
from 35,000 to 42,000. There are five multi-regional food brokerage firms,
including the Company, each with approximately 3% market share. In total,
there are approximately 12 large regional food brokerage firms in the United
States. A number of the companies in the food brokerage industry, including
Merkert and Rogers, have participated in the trend towards consolidation by
acquiring other food brokerage businesses, generally financing these
transactions with debt and/or by deferring the payment of a portion of the
purchase price.

Private Label Food Brokers. Private label food brokers work with
Manufacturers to develop and manage the private label programs on behalf of
Retailers. A food broker's responsibilities in connection with a private label
program may include procurement and inventory management and in-store delivery
of private label products. The private label segment has been a substantial
growth segment for Retailers in recent years.

Food Service Brokers. Food service providers include operators of
restaurants, school and hospital cafeterias and other similar establishments.
Food brokers sell Manufacturers' products to food service providers through a
number of means, including headquarters sales calls and the representation of
Manufacturers' products at trade shows. The food service segment of the
industry has experienced significant growth in recent years as an increasing
percentage of consumer spending for food in the United States has shifted to
meals away from home.

BUSINESS STRATEGY

The Company's objective is to become the leading national provider of
outsourced sales, merchandising and marketing services to Manufacturers,
Retailers and food service providers throughout the United States. The
Company's business strategy comprises the following key elements:

35
<PAGE>

Expand Current and Develop New Manufacturer Relationships. The Company seeks
to increase its representation of existing Manufacturers' product lines by
representing Manufacturers' products in new geographic markets and non-
supermarket trade channels, including mass merchandisers, food service
providers, membership warehouses, drug stores and convenience stores. The
Company also seeks to increase the range of products it represents on behalf
of the Manufacturers it currently serves and enter into new relationships with
Manufacturers.

Provide Effective Marketing Support and Valuable Category Management
Technology. The Company's marketing expertise and information technology
system allow it to utilize local demographic information and information about
retail store level conditions to understand consumer purchasing preferences in
local markets. As a result, the Company is able to develop and implement
targeted consumer sales promotions for its Manufacturers' products. The
Company also deploys category analysts who use local sales data to assist
Retailers with shelf schematics, category layouts and total store space
management.

Growth Through Strategic Acquisitions. The Company intends to pursue
strategic acquisitions in the food brokerage industry. Since 1994, Merkert and
Rogers have acquired and integrated 21 companies, successfully adding coverage
of new geographic markets and expanding representations of Manufacturers'
product offerings in existing markets. The Company is currently engaged in
discussions regarding the potential acquisition of a food broker operating in
a territory contiguous to the Company's current territory. The Company's plans
include the selection, acquisition and management of businesses in the
following brokerage market segments:

. Retail: A key element of the Company's acquisition strategy is to expand
its geographic coverage by acquiring existing retail food brokerage
firms in new geographic markets. The Company also seeks acquisition
candidates that conduct business within the Company's existing territory
and offer the Company the opportunity to expand its representation of
Manufacturers and product categories and its coverage of Retailers
within existing markets. The Company's acquisition strategy is also
focused on candidates that will enable it to represent additional
product categories and cover additional distribution channels. In
particular, the Company believes that health and beauty care and general
merchandise brokerage and bakery, deli, meat, seafood, floral and
produce brokerage have significant growth potential. The Company's
strategic plans also include the coverage of convenience stores, as it
believes convenience stores will account for an increasingly larger
portion of food sales as sales of meal replacements and non-traditional
grocery items continue to grow. Retail food brokerage represented
approximately 78% of the Company's revenues for the year ended December
31, 1997 on a pro forma basis.

. Private Label: The Company believes that the private label food
brokerage segment is currently fragmented and that the Company can
further develop its private label operations through targeted
acquisitions of private label food brokers within this growing segment
of the food industry. Private label sales and brokerage represented
approximately 15% of the Company's revenues for the year ended December
31, 1997 on a pro forma basis.

. Food Service: Sales to entities in the food service segment of the food
industry represented approximately 3% of the Company's revenues for the
year ended December 31, 1997 on a pro forma basis. The Company believes
that it will be able to expand its operations within the fragmented food
service segment through the acquisition of existing food service brokers
who sell Manufacturers' products to food service providers.

The Company believes that its acquisition strategy will enable it to:

. Strengthen Market Presence: By expanding its geographic coverage, the
Company will be able to offer Manufacturers more extensive and better
coordinated coverage of Retailers who operate across geographic regions.
As the Company expands the portion of a given Manufacturer's sales that
it represents, it will be better positioned to meet Manufacturers' needs
by providing a wide range of services across a broader geographic area.
This will enable Manufacturers to increase the effectiveness of their
marketing programs and reduce the costs associated with managing their
brokerage networks by using fewer food brokerage companies.

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<PAGE>

. Benefit from Increased Economies of Scale: As the Company expands the
number of Manufacturers and product lines it represents, it expects to
realize certain economies which will result from the low incremental
cost of representing additional Manufacturers and product lines. The
Company also expects to recognize certain economies of scale as the
Company expands its operations to cover a larger geographic region.

. Improve Operating Efficiencies: The Company believes that as it
integrates acquired companies it will be able to eliminate certain
duplicative operations, facilities and personnel. The Company expects to
realize cost savings through the consolidation of certain administrative
functions.

Increase Private Label Brokerage. The Company has a division that
specializes in the development, procurement and inventory management of
private label frozen products, including fruits, vegetables and other products
on behalf of certain Retailers. The Company's private label division currently
works in conjunction with Retailers such as A&P, Price Chopper, Publix and
Royal Ahold (including Stop & Shop, Bi-Lo and Giant Food). In addition, the
increasing geographic coverage of the Company will provide the Company with
the opportunity to offer private label services to more retailers and more
retail locations.

Expand Food Service Brokerage. Sales to entities in the food service
brokerage segment of the food industry currently represent a small part of the
Company's business. The Company believes that there is a high degree of
fragmentation in this industry segment and that the food service brokerage
segment presents opportunities for profitable growth through strategic
acquisitions, as well as through developing new account relationships through
its existing operations. The Company intends to pursue expansion of its food
service brokerage line within its existing geographic coverage and to develop
food service brokerage in new territories.

Seek International Opportunities. The Company believes that many
opportunities exist outside the United States for sales, marketing and food
brokerage services in connection with retail food stores and in the
development of private label programs for Retailers. Certain Retailers,
including Royal Ahold, J. Sainsbury PLC and Food Lion Supermarkets, among
others, currently operate on an international basis. The Company believes that
international expansion would involve the acquisition of food brokers in
countries where food brokers are used by Manufacturers and Retailers. The
Company has recently entered into an agreement to provide private label
services to a Retailer based in Japan for its peanut butter and red wine
products.

Empower Local Management and Develop Professional Staff. The senior
management of the Company will provide overall strategic direction and
guidance with respect to acquisitions, financing, marketing and operations. In
general, however, it is the intention of the Company to continue to operate
its day-to-day business on a locally oriented basis. The Company intends to
continue the development of proprietary "best practices" by emphasizing an
entrepreneurial culture at the local level. The Company believes that the
flexibility of a locally oriented approach to operational matters enables the
Company to effectively respond to changes in the competitive environment.

The Company believes that a key factor to its continuing success is the
strength of its professionals. The development and training of employees has
contributed to the Company's continued growth and profitability. In keeping
with the Company's philosophy and operating structure, the Company intends to
continue to manage employee relations and human resource development at the
local level. Management at the local level is responsible for developing and
training the professional staff which reports to them and for creating an
environment that promotes employee satisfaction and optimal performance.

COMPANY HISTORY

The Company was organized in March 1998 and, to date, has conducted
operations only in connection with the Combination and the Offering. See
"Certain Transactions--Organization of the Company" and "The Combination."
Unless the context otherwise requires, references to the "Company" herein mean
Merkert American Corporation together with Merkert and Rogers after
consummation of the Combination.

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<PAGE>

Merkert Enterprises, Inc., one of the entities to be acquired in the
Combination, has operated as a food broker in the northeastern and mid-
Atlantic regions of the United States since 1950. In 1997, Merkert
Enterprises, Inc. had total revenues of approximately $147.4 million, the
principal source (71%) of which was from commissions it received from
Manufacturers. Merkert Enterprises, Inc. also manages private label programs
on behalf of selected Retailers. Merkert Enterprises, Inc. has grown its
revenues through both internally generated growth and through acquisitions,
having acquired and integrated six smaller food brokers since 1994. Merkert
Enterprises, Inc. financed such acquisitions, in part, with debt and/or by
deferring payment of a portion of the purchase price. A portion of the net
proceeds of the Term Loan will be used to repay certain of such acquisition-
related obligations of Merkert Enterprises, Inc. Primarily as a result of such
obligations, as well as a substantial tax liability, Merkert Enterprises, Inc.
has experienced losses and a working capital deficit in recent years. The
stockholders of Merkert Enterprises, Inc. have agreed to pay such tax
liability from cash otherwise payable to them in connection with the
Combination. After giving effect to the Offering and the expected application
of the net proceeds therefrom and the application of the Term Loan proceeds,
the Company will not have a working capital deficit. See "Risk Factors--
Implementation of Acquisition Strategy; Risks Related to Growth Strategy," "--
Merkert Enterprises, Inc.-- History of Losses" and "Management's Discussion
and Analysis of Financial Condition and Results of Operations--Results of
Operations--Merkert," and "--Liquidity and Capital Resources--Merkert."

Rogers has operated as a food broker in the southeastern region of the
United States since 1934. In 1997, Rogers had total revenues of approximately
$83.0 million, all of which was derived from commissions it received from
Manufacturers. Rogers has grown its revenues through both internally generated
growth and through acquisitions, having acquired and integrated 15 smaller
food brokers since l994. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations--Results of Operations--Rogers."

SERVICES AND OPERATIONS

The Company has traditionally provided Manufacturers with a full array of
sales, marketing and administrative services and has been paid a commission by
Manufacturers. In certain cases, the Company has entered into "hybrid"
arrangements with Manufacturers under which the Company provides less than
full geographic coverage and/or services. Commissions from full and hybrid
services represented approximately 82% of the Company's revenues for the year
ended December 31, 1997 on a pro forma basis. The functions and services
provided by the Company are described below.

Full Services. The Company currently provides full services to approximately
92% of the Manufacturers that it represents. When the Company provides full
services to a Manufacturer in connection with the sale of its products to
Retailers, the commission is generally 3% of the Manufacturer's net sales to
such Retailers. The services that the Company provides to Manufacturers in a
full services arrangement include:

. Account Service and Business Development: In general, the Company's
Manufacturers are serviced by business managers, each of whom is
responsible for identified products of a number of Manufacturers within
one region (such as New England). The Company's business managers,
customer service personnel and support staff utilize information
developed by the Company to assist Manufacturers in devising strategic
sales plans and achieving merchandising goals and in utilizing retail
information to develop customized marketing strategies, including
determining the assortment of current and new products to be offered and
promotions designed to increase revenues and profitability. The
activities of these business managers are supervised by general managers
who manage categories of products such as groceries, frozen foods and
perishables, or health, beauty care and confection products.

The Company's Regional Business Managers ("RBMs") are Company
executives who provide the primary link between the Company and certain
of the Company's largest Manufacturers. Each of the Company's RBMs is
dedicated to a single Manufacturer and directs a multi-regional team (a
"Manufacturer Team") comprised of business managers (each of whom
manages the Company's activities on behalf of a Manufacturer in a
specified region), customer service personnel and support staff. These
RBMs provide their Manufacturers with services similar to those
provided by business managers.

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<PAGE>

. Administrative Management: The Company handles both order management and
certain billing management services for Manufacturers. The Company's
order management system enables it to perform all major order management
functions relating to orders for goods from Retailers to Manufacturers.
The Company has developed a centralized order management system to
generate electronic orders through electronic data interchange ("EDI").
This system enables the Company to verify quantities, product codes,
pricing, pack sizes and promotions pertaining to an order. The Company's
order management system also reconciles Manufacturer invoices with
Retailer purchase orders and manages and processes promotional
allowances and credits for Retailers. In addition, the Company
facilitates the resolution of billing issues between Manufacturers and
Retailers.

. Category and Shelf Space Management: The Company's category management
analysts and shelf space management analysts serve as liaisons, linking
the Company, RBMs, business managers and Manufacturer Teams with
retailer teams, comprised of headquarters account managers and retail
merchandisers ("Retailer Teams"). These retail analysts develop
information from retail data collected by the Company's Retailer Teams
and by outside sources, including ACNielson Corp. and Information
Resources, Inc. RBMs and business managers use this information in
developing multi-regional, regional and local strategies with
Manufacturers. Retailer Teams also use this information, as well as
store-specific sales and demographic information provided by these
analysts, to implement sales and merchandising strategies at the local
level. These category management activities enable Manufacturers to
prepare fact-based selling strategies used in product and promotional
planning. These activities also enable Retailers to increase sales and
profitability by more effectively utilizing their resources, including
shelf space as well as marketing and promotional expenditures.

. Retail Services: In general, the Company's headquarters account managers
and retail merchandisers represent a wide range of Manufacturers'
products to specified Retailers within a region. The Company's
headquarters account managers call upon Retailers at the headquarters
level and represent numerous products on behalf of the Company's
Manufacturers. The Company's largest Retailers are called upon by
multiple headquarters account managers, each representing specific
product categories such as groceries, frozen food/perishables or health,
beauty care and confectionery products. Smaller Retailers are generally
called upon by headquarters account managers who represent multiple
product categories. Headquarters account managers help execute sales
plans developed by RBMs, business managers and Manufacturers. Through
their frequent service calls, the Company's retail merchandisers develop
relationships with store managers and in-store category managers and
assist headquarters account managers to execute sales plans for
Manufacturers' products. The Company's retail merchandisers execute
sales plans at the store level by providing shelf and display
management, new store set-ups, stocking of new items and placement of
point-of-sale coupons and signs.

The Company's largest Retailers are serviced by dedicated Retailer
Teams. In some cases, these dedicated Retailer Teams include shelf
space management analysts who provide shelf management and display
expertise.

The Company also initiates and executes local marketing events on
behalf of Manufacturers in order to build Manufacturer brand
recognition. These efforts include the preparation and display of
special signage, coupon programs and other promotional activities
between Manufacturers and Retailers.

Hybrid Services. In response to increasing demand from certain Manufacturers
who are outsourcing more of their retail services functions, the Company has
recently entered into "hybrid" agreements under which the Company provides
only specified services, geographic coverage and Retailer coverage to a
Manufacturer. The Company has entered into hybrid agreements with
approximately 5% of the Manufacturers the Company represents. The fee for such
services varies based on the particular services provided. By providing a
flexible alternative to commission-based pricing, the Company has increased
the total number of Manufacturers it represents and believes that such hybrid
services may also result in sales of additional services to Manufacturers.
Providing retail-only services is a common hybrid arrangement. Retail-only
services primarily include initial retail shelf set-ups and subsequent store
shelf space management. The Company provides retail-only services to

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<PAGE>

approximately 3% of the Manufacturers it represents. These retail-only
services generally provide for compensation equivalent to a commission of
approximately 1.0% of the value of product sales to the Retailer.

Private Label. The Company's private label division, which accounted for
approximately 14% of the Company's revenues for the year ended December 31,
1997 on a pro forma basis, develops, procures, and manages inventory of
private label products (including frozen fruits and vegetables and other
products) on behalf of certain Retailers. This division works in conjunction
with major Retailers such as A&P, Price Chopper, Publix and Royal Ahold. The
Company intends to expand its private label programs into all of its regional
markets as part of the integrated package of services the Company offers.

Store Supplies. The Company's store supplies division, which accounted for
approximately 4% of the Company's revenues for the year ended December 31,
1997 on a pro forma basis, operates as a distributor for Monarch Marking
Systems, Inc. and sells price marking equipment, labels and other related
store supplies to Retailers in New England and metropolitan New York City. In
addition, the Company sells a bio-degreaser product to Retailers' supermarket,
meat and bakery departments, restaurants and other food service customers
directly and through local distributors. The Company intends to expand
distribution of this bio-degreaser product into all its markets.

MANUFACTURERS AND RETAILERS

Manufacturers. The Company has had up to 44 years of successful
relationships with companies such as Dean Foods/Birds Eye, H.J. Heinz, Lipton,
Minute Maid, Ocean Spray, Pillsbury, Quaker and hundreds of others. These
companies manufacture grocery-related and food service products covering a
wide spectrum of categories and sub-categories from staples to perishables.
The Company acts as the exclusive broker for certain products of a
Manufacturer only within specific geographic regions. Manufacturers typically
use multiple food brokers, divided by product line or geographic market. No
single Manufacturer represented more than 5% of the Company's revenues for the
year ended December 31, 1997, on a pro forma basis.

Retailers. On the retail side, the Company has a long established history
with many large and mid-sized Retailers in the food industry. Many of these
Retailers are, or are owned by, some of the world's largest food retailers,
while others are leading regional players. No single Retailer represented more
than 6% of the Company's revenues for the year ended December 31, 1997, on a
pro forma basis. The top Retailers serviced by the Company based on 1997
revenues include those listed below:

<TABLE>
<CAPTION>
RETAILER NAME OPERATING REGION
------------- -------------------------------
<S> <C>
C&S Wholesale Grocers, Inc................. Northeast US
Food Lion, Inc./Delhaize................... Southeast US
Hannaford Brothers......................... New England and southeast US
J. Sainsbury PLC (Shaws Supermarkets)...... New England and mid-Atlantic US
Kroger..................................... Southeast US
Publix Supermarkets........................ Southeast US
Royal Ahold (including Stop & Shop, Bi-Lo
and Giant Foods).......................... Eastern US
Safeway.................................... Mid-Atlantic US
Supervalu.................................. Northeast and southeast US
White Rose................................. Northeast US
Wakefern (Shop Rite)....................... Mid-Atlantic US
Winn-Dixie................................. Southeast US
</TABLE>

INFORMATION TECHNOLOGY

The application of information technology has become an increasingly
important element in the food brokerage industry. In order to provide
Manufacturers and Retailers with the most efficient and useful information and
services, the Company has invested in current retail information technology.

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<PAGE>

Electronic Data Interchange. The EDI system, which was first used in the
industry in 1980, streamlines order communications among food brokers,
Retailers and Manufacturers. EDI has played a growing role as an increasing
number of Manufacturers, Retailers and food brokers have integrated their
systems with EDI. Orders sent by EDI are transmitted on-line from the Retailer
to the Company and entered automatically into the Company's order databases.
Orders are reviewed by the Company to verify that quantities, product codes,
pricing, pack sizes and promotions have been correctly submitted. The Company
then places orders with certain Manufacturers via EDI. By reducing manual
order processing, the system significantly curtails order input errors,
expedites order processing and reduces the number of personnel required to
fulfill this function.

Retail Information. The Company utilizes a retail reporting system to update
Manufacturers with store-specific information regarding their products. The
Company's retail representatives record information on in-store merchandise
conditions, including product placement and pricing information. This
information is then entered into the Company's retail reporting system. The
Company's retail reporting system allows both the Company and its
Manufacturers to easily access store-level information. The Company believes
that it is one of only a few food brokers offering comprehensive merchandising
information regarding store-specific retail conditions.

Local Area Network and Web Technology. The Company was among the first food
brokers to install a company-wide local area network and wide area network,
enabling it to provide on-line information to Manufacturers and Retailers. To
disseminate this information, the Company utilizes the internet and dedicated
extranets. The Company's internet site on the worldwide web is being developed
to market the Company's services to potential Manufacturers and Retailers. The
Company's on-line service allows it to communicate with Retailers and
Manufacturers and to provide them with marketing, sales and other information
related to their products and operations.

COMPETITION

The food brokerage market is large and fragmented, with brokers serving
numerous local markets and a few large brokers serving multiple regions in the
United States. The Company acts as the exclusive broker for certain products
of a Manufacturer only within specific geographic markets. Manufacturers
typically use multiple food brokers, divided by product line or geographic
market. The Company competes with other food brokers for the right to
represent Manufacturers' product lines to Retailers. As a result of the large
and fragmented food brokerage market, the Company competes with brokers
serving local markets as well as large brokers serving multiple regions.
Competition is based primarily on breadth of geographic coverage, and the
quality and scope of services provided. In addition, many Manufacturers,
including some of the Manufacturers served by the Company, employ sales
personnel to sell directly to Retailers and distributors. See "Risk Factors--
Competition."

The entire food distribution chain, including Manufacturers, Retailers, and
food brokers, has been consolidating over the past 10 years. As the market
becomes more concentrated in terms of the total number of Manufacturer and
Retailer accounts served by food brokers, the Company believes that large
brokers that can provide a full array of services to leading Manufacturers and
Retailers across multiple geographic markets have a competitive advantage. The
Company believes that Manufacturers will favor large regional and national
food brokers with the personnel and technology resources necessary to operate
in an increasingly sophisticated and complex environment, and the capability
to provide the local market focus required by Manufacturers and Retailers.

The Company will, upon completion of the Offering, become the first publicly
held food broker in the United States, with operations spanning most of the
eastern United States. The Company is one of the five largest food brokers in
the United States and competes with the nation's other multi-regional food
brokers--Advantage Sales, Richmont Marketing Specialists, Crossmark and
Acosta-PMI. In total, there are approximately 12 large regional food brokerage
firms in the United States. On a local and regional basis the Company competes
with Pezrow, Eastern States, and MAI. Some of the Company's competitors
include alliances of smaller regional food brokers.

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<PAGE>

COMBINATION--INTEGRATION OF FUNCTIONS

In connection with the Combination, the Company has developed an integration
program to implement appropriate organizational and operational changes in
connection with the Combination. This program provides a framework by which
the administrative functions of both Merkert and Rogers may be rationalized
and combined into a single unit. Payroll administration and reporting, for
example, will be centralized at the Company's headquarters to eliminate
redundancies. Financial and management reporting systems will also be
integrated, using the systems already in place at Rogers. Moreover, as both
Merkert and Rogers already utilize the same order processing system (with the
exception of Rogers' mid-Atlantic operations), this administrative function
will be integrated and provide the Company with further operating
efficiencies. The Company intends to substantially complete the integration of
Merkert and Rogers prior to the end of 1998. The Company's integration program
includes coordination efforts with Manufacturers to minimize Manufacturer
conflicts and any related losses in connection with the Combination.

EMPLOYEES

The Company has approximately 3,000 full and part time employees. The
Company believes that its relations with its employees are good. Management
believes that none of the Company's employees is a member of any labor union.

PROPERTIES

The Company's executive offices are located at 490 Turnpike Street, Canton,
Massachusetts 02021. The Company's telephone number at such location is (781)
828-4800. In addition to its executive offices, the Company maintains 30 sales
offices in 22 states in the eastern United States, the two largest of which
are:

<TABLE>
<CAPTION>
APPROXIMATE
LOCATION PRINCIPAL USAGE AREA IN SQ. FT. LEASED/OWNED
-------- --------------- --------------- ------------
<S> <C> <C> <C>
Charlotte, NC Office 54,000 Owned*
Canton, MA Office 50,000 Owned
</TABLE>
- --------
* This facility is currently owned by Rogers. Following the Combination, the
Company will sell this facility to a third party. Such third party will
lease this facility to the Company. The net proceeds of the sale will be
distributed to certain Rogers shareholders. See "Certain Transactions."

The Company believes that its properties are generally well maintained and
in good condition. The Company believes that its properties are adequate for
present needs and that suitable additional or replacement space will be
available as required.

LEGAL PROCEEDINGS

Merkert and Rogers have separately received written notices from the sellers
of two food brokerage businesses acquired by them alleging the breach of
certain covenants contained in agreements with such sellers. In each case,
such sellers are claiming that such breaches have caused the acceleration of
certain payments to such sellers of the deferred purchase price and
employment-related obligations. In the case of Rogers, the obligations to such
sellers are secured by a lien on the assets and a pledge of the capital stock
of Rogers' Florida subsidiary, Rogers-American Company of Florida, Inc. In the
case of Merkert, such sellers have filed an arbitration demand claiming breach
of contract and seeking (i) acceleration of the payment of deferred purchase
price, together with interest, costs and attorneys' fees and (ii) termination
by such sellers of their employment with Merkert for cause. The arbitration is
currently pending before the American Arbitration Association. In connection
with the acquisition of Merkert, a portion of the cash purchase price will be
held in escrow to cover a portion of the potential liabilities resulting from
an adverse outcome of this arbitration. Taking into account such escrow and
the expected use of the net proceeds of the Offering and the borrowings
available under the Term Loan (which includes, among other things, the funding
of obligations relating to each of such matters), the

42
<PAGE>

Company believes that such matters, if determined adversely to the Company,
would not have a material adverse effect on the Company. Merkert is currently
the subject of an audit with respect to its federal income tax returns for its
fiscal years 1995, 1996 and 1997. In connection with the acquisition of
Merkert, a portion of the cash purchase price will be held in escrow to cover
potential liabilities resulting from the audit and the Company does not
believe that the ultimate outcome of this audit will have a material adverse
effect on the Company. The Company is from time to time a party to litigation
arising in the ordinary course of business. There can be no assurance that the
Company's insurance coverage will be adequate to cover all liabilities
occurring out of such claims. In the opinion of management, any liability that
the Company might incur upon the resolution of this litigation will not, in
the aggregate, have a material adverse effect on the financial condition or
results of operations of the Company.

YEAR 2000 COMPLIANCE

The Company has evaluated its information technology infrastructure,
software and communications platforms for potential exposure to problems
associated with Year 2000 compliance. This evaluation has included testing,
inquiries of vendors and other research.

Significant system upgrade activity in the past two years, including the
upgrade of the order processing system at Merkert and the financial system at
Rogers has substantially reduced potential Year 2000 problems.

The Company has determined that the Merkert financial system is not Year
2000 compliant and has decided to replace it with the existing Rogers system,
which is compliant. This replacement is expected to be completed by March,
1999 and is estimated to cost approximately $0.2 million. Additionally,
Rogers' mid-Atlantic operations will migrate to the order processing system,
which is compliant and is already in use at Merkert and the other regions of
Rogers, in the first quarter of 1999. This is estimated to cost approximately
$0.1 million. See "--Combination--Integration of Functions."

The Company has determined that several PBX (telephone) systems at Rogers
must be replaced as they are not Year 2000 compliant. The cost of the new
phone systems is estimated at $0.1 million. In addition, approximately $0.2
million of personal computers will need to be replaced as they cannot be
upgraded. This replacement and upgrade will occur in 1998.

43
<PAGE>

MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth information concerning the Company's
directors and executive officers and those persons who will become directors
and executive officers upon consummation of the Offering.

<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Gerald R. Leonard............... 51 Chairman of the Board, Chief Executive
Officer and President
James L. Monroe................. 39 Non-Executive Chairman of the Board
Douglas H. Holstein............. 54 Chief Operating Officer of the Company,
President of Rogers (a subsidiary of the
Company) and Director
Sidney D. Rogers, Jr............ 46 Chief Financial Officer
Marty D. Carter................. 38 Vice President of Acquisitions and Chief
Financial Officer of Rogers (a
subsidiary of the Company)
Glenn F. Gillam................. 46 President of Merkert (a subsidiary of
the Company)
Edward P. Grace, III............ 47 Director
James A. Schlindwein............ 69 Director
</TABLE>

Gerald R. Leonard will become Chairman of the Board, Chief Executive Officer
and President of the Company upon consummation of the Offering. Mr. Leonard
has been Chief Executive Officer of Merkert since September 1994. From May
1992 to September 1994, Mr. Leonard served Merkert as President of the Food
Enterprises, New England Division, and has been with Merkert in various
executive capacities since 1983. Mr. Leonard has also held sales and
management positions with Procter & Gamble, William Underwood Company and
Green Giant Company. Mr. Leonard has more than 26 years of experience in food
brokerage, manufacturing and related industries.

James L. Monroe has served as President of the Company since March 1998.
Upon consummation of the Offering, Mr. Monroe will serve as Non-Executive
Chairman of the Board of the Company. In 1997, Mr. Monroe founded Monroe &
Company, LLC, a merchant banking firm that invests in companies in
consolidating industries. From January 1994 until December 1996, Mr. Monroe
was a Senior Vice President of Oppenheimer & Co., Inc. where he managed the
Boston Corporate Finance department and the national consumer industry banking
practice. From 1992 until 1993, Mr. Monroe was a Managing Director at Advest,
Inc., an investment banking and brokerage firm. Mr. Monroe has thirteen years
of investment and merchant banking experience.

Douglas H. Holstein will become Chief Operating Officer, President of
Rogers, and a director of the Company upon consummation of the Offering. Mr.
Holstein has been President of Rogers since January 1993, and has been with
Rogers in various executive capacities since 1981. Prior to joining Rogers,
Mr. Holstein was the Regional Director of the Southeast for the Green Giant
Company.

Sidney D. Rogers, Jr. will become the Chief Financial Officer of the Company
upon consummation of the Offering. Mr. Rogers has been Chief Financial Officer
and Vice President of Merkert since 1994 and has been with Merkert since 1977.
Prior to serving as Chief Financial Officer of Merkert, Mr. Rogers was Vice
President Administration of Merkert since 1986.

Marty D. Carter will become Vice President of Acquisitions of the Company
and Chief Financial Officer of Rogers (a subsidiary of the Company) upon
consummation of the Offering. Mr. Carter has been the Chief Financial Officer
of Rogers since 1987. From 1984 to 1987, Mr. Carter was in the audit practice
group of Touche Ross & Co.

44
<PAGE>

Glenn F. Gillam became President of Merkert (a subsidiary of the Company) on
June 1, 1998. Mr. Gillam has been President of the Food Enterprises, New
England Division, of Merkert since 1994, and has been with Merkert in various
capacities since 1983. Mr. Gillam has held sales and management positions with
companies involved in health and beauty care/general merchandise, frozen food,
confection and grocery since 1973.

Edward P. Grace, III will become a director upon consummation of the
Offering. Mr. Grace is President of Phelps Grace International, Inc., a
restaurant consulting and investment company. From 1989 until September 1996,
Mr. Grace served as Chairman of the Board, President and Chief Executive
Officer of Bugaboo Creek Steak House, Inc., operator of Bugaboo Creek Steak
House and The Capital Grille restaurants. Mr. Grace is Vice Chairman and a
director of RARE Hospitality International, Inc. and a director of
Professional Facilities Management, Inc. He also serves as a Trustee of the
University of Vermont and of Johnson & Wales University.

James A. Schlindwein will become a director of the Company upon consummation
of the Offering. Mr. Schlindwein has been a director of Merkert since 1995.
Prior to his retirement in September 1994, Mr. Schlindwein served as Executive
Vice President, Merchandising Services, and a director of Sysco Corporation, a
national institutional food service distributor, where he had served since
1980. He is also a director of Tri-Valley Growers, EMMPAK Foods, Inc. Alaska
Seafood International, Chilay Corporation and Thompson's Pet Pasta Products,
Inc.

BOARD OF DIRECTORS

The business of the Company is managed under the direction of the Board of
Directors. After consummation of the Combination and the Offering, the Board
of Directors will consist of five directors. The Company's Amended and
Restated Certificate of Incorporation provides that the Board of Directors
shall be divided into two classes until the later to occur of (i) the first
day after the second anniversary of the consummation of the Offering and (ii)
the first day after the first election of Class II Directors occurring after
the consummation of the Offering and shall thereafter be divided into three
classes (such event, the "Board Conversion"). The members of each class of
directors shall initially serve for staggered two-year terms. The Board of
Directors will initially be composed of two Class I Directors (Messrs.
Holstein and Schlindwein) and three Class II Directors (Messrs. Grace, Leonard
and Monroe), whose initial terms will expire upon the election and
qualification of directors at the annual meetings of stockholders held
following the years ending 1999 and 2000, respectively. The Amended and
Restated Certificate of Incorporation further provides that upon the
occurrence of the Board Conversion, each class of the Board of Directors will
be chosen for staggered three-year terms upon the expiration of their then-
current terms and each year one class of directors will be elected by the
stockholders, provided, however, the initial term of the Class III Directors
will expire upon the election and qualification of directors at the annual
meeting of stockholders held in the third year following the Board Conversion.
The Company believes that classification of the Board of Directors will help
to assure the continuity and stability of the Company's business strategies
and policies as determined by the Board of Directors. Holders of shares of
Common Stock will have no right to cumulative voting in the election of
directors. Consequently, at each annual meeting of stockholders, the holders
of a majority of the shares of Common Stock will be able to elect all of the
successors of the class of directors whose terms expire at that meeting.

Following consummation of the Offering, the Board of Directors will
establish an audit committee (the "Audit Committee") and a Compensation
Committee (the "Compensation Committee"). The Audit Committee, a majority of
which will be outside directors, will recommend to the Board of Directors the
firm to be appointed as independent accountants to audit financial statements
and to perform services related to the audit, review the scope and results of
the audit with the independent accountants, review with management and the
independent accountants the Company's year-end operating results, consider the
adequacy of the internal accounting procedures and consider the effect of such
procedures on the accountants' independence. The Compensation Committee, which
will consist solely of outside directors, will review and recommend to the
Board of Directors the compensation arrangements for all directors and
officers, approve such arrangements for other senior level employees and
administer and take such other action as may be required in connection with
certain compensation and incentive plans of the Company. The Compensation
Committee will also determine the number of options to be granted or shares of
Common Stock to be issued to eligible persons under the Company's 1998 Stock
Plan. In addition, the Compensation Committee will construe and interpret the
1998 Stock Plan and issuances thereunder, and establish, amend and revoke
rules and regulations for administration of the 1998 Stock Plan.

45
<PAGE>

Members of the Board of Directors who are also employees of the Company do
not receive compensation for their services on the Board of Directors or any
committee thereof. Each director who is not an employee of the Company (an
"Independent Director") receives an annual fee of $25,000. Upon consummation
of the Offering, each Independent Director will be granted an option to
purchase 20,000 shares of Common Stock at an exercise price equal to the
initial public offering price per share of Common Stock. Under the 1998 Stock
Plan, each new Independent Director elected following the Offering is entitled
to receive an initial grant of an option to purchase 20,000 shares of Common
Stock upon his or her election to the Board of Directors, and each Independent
Director who is serving as a director of the Company on the fifth business day
after each annual meeting of stockholders, beginning with the 1999 annual
meeting, will automatically be granted an option to purchase 5,000 shares of
Common Stock. In addition, the Independent Director who serves as chairman of
the Audit Committee of the Board of Directors will receive options to purchase
an additional 5,000 shares of Common Stock upon consummation of the Offering
and an additional 5,000 shares of Common Stock on the fifth business day after
each annual meeting of stockholders beginning with the 1999 annual meeting.
All options granted to Independent Directors under the 1998 Stock Plan shall
vest 50% upon the first anniversary of the grant date, and the remaining 50%
shall vest in equal annual installments over the number of years remaining in
each Director's term as of the first anniversary of the date of grant, shall
terminate upon the tenth anniversary of the date of grant and will have an
exercise price per share equal to the fair market value of the Common Stock on
the date of such grant. See "--1998 Stock Option and Incentive Plan-Stock
Options Granted to Independent Directors."

All members of the Board of Directors are reimbursed for travel expenses
incurred in attending meetings of the Board of Directors and its committees.

EXECUTIVE COMPENSATION; EMPLOYMENT AND NONCOMPETITION AGREEMENTS

The Company was incorporated in March 1998, has conducted no operations
other than those associated with the Offering and the Combination, and will
not pay any of its executive officers any compensation prior to the
consummation of the Offering. The Company will enter into employment and
noncompetition agreements upon consummation of the Offering with certain of
its executive officers. The material terms of these agreements are summarized
below.

Each of Messrs. Leonard, Holstein, Rogers, Carter and Gillam will enter into
employment and noncompetition agreements with the Company providing for base
salaries of $350,000, $300,000, $195,000, $175,000 and $250,000, respectively.
Each employment and noncompetition agreement will be for a term of three
years, and unless terminated or not renewed by the Company or the executive
officer, the term will continue thereafter. In general, these agreements will
provide that the executive officer's employment with the Company may be
terminated for "cause" by the Company for (i) dishonest statements or acts
which constitute material disloyalty or dishonesty toward the Company or cause
significant damage to the Company; (ii) the commission by or indictment of the
executive officer for a felony, or any misdemeanor involving moral turpitude,
deceit, dishonesty or fraud; (iii) an uncured failure by the executive officer
to perform a substantial portion of his duties and responsibilities; (iv)
uncured gross negligence, willful misconduct or insubordination; or (v) an
uncured material breach of any of his material obligations under the
employment and noncompetition agreement. In the event of termination of
employment by the Company without cause, the executive officer will be
entitled to receive from the Company continuation of his then current base
salary until the later of expiration of the initial term or twelve months from
the date of termination of employment, provided that in the case of Messrs.
Holstein and Carter, the executive officer will also be entitled to receive
from the Company continuation of health plan benefits and automobile benefits
until the expiration of the initial term. Each employment and noncompetition
agreement will contain a covenant not to compete with the Company during the
initial term of the agreement and for a period of one year following
termination of employment or, if longer, for the period during which the
executive officer shall be entitled to receive continuation of his base salary
following termination of employment by the Company without cause.

46
<PAGE>

1998 STOCK OPTION AND INCENTIVE PLAN

On May 20, 1998, the Board of Directors of the Company adopted, and the
stockholders approved, the initial 1998 Stock Plan and on July 1, 1998, the
Board of Directors of the Company adopted, and the stockholders approved, the
Amended and Restated 1998 Stock Option and Incentive Plan. The 1998 Stock Plan
is designed and intended as a performance incentive for officers, employees,
consultants and Independent Directors to promote the financial success and
progress of the Company. The Company anticipates that providing such persons
with a direct stake in the Company's welfare will assure a closer
identification of their interests with those of the Company, thereby
stimulating their efforts on the Company's behalf and strengthening their
desire to remain with the Company. All officers and Independent Directors are
eligible to participate in the 1998 Stock Plan.

The 1998 Stock Plan provides for the issuance of up to thirteen percent of
the number of shares of Common Stock outstanding from time to time. Upon
consummation of the Offering, the Company will have reserved 929,500 shares of
Common Stock for issuance under the 1998 Stock Plan, of which 650,000 shares
will be subject to outstanding options and 279,500 will remain available for
issuance. On and after the date the 1998 Stock Plan becomes subject to Section
162(m) of the Internal Revenue Code of 1986, as amended (the "Code"), options
with respect to no more than the total number of available shares of Common
Stock may be granted to any one individual in any calendar year.

The following summary description does not purport to be complete and is
qualified in its entirety by the 1998 Stock Plan, a copy of which is filed as
an exhibit to the Registration Statement of which this Prospectus is a part.

Plan Administration; Eligibility. The 1998 Stock Plan is administered by the
Board of Directors or the Compensation Committee thereof. All members of the
Committee must be "non-employee directors" as that term is defined under the
rules promulgated by the Securities and Exchange Commission and "outside
directors" as defined in Section 162(m) of the Code and the regulations
promulgated thereunder.

The Compensation Committee has full power to select, from among the
employees and other persons eligible for awards, the individuals to whom
awards will be granted, to make any combination of awards to participants, and
to determine the specific terms and conditions of each award, subject to the
provisions of the 1998 Stock Plan. The Compensation Committee may permit
Common Stock, and other amounts payable pursuant to an award, to be deferred.
In such instances, the Compensation Committee may permit dividends or deemed
dividends, if any, to be credited to the amount of deferrals.

Persons eligible to participate in the 1998 Stock Plan will be those
officers, employees and other key persons, such as consultants, of the Company
and its subsidiaries who are responsible for or contribute to the management,
growth or profitability of the Company and its subsidiaries, as selected from
time to time by the Compensation Committee. Independent Directors will also be
eligible for certain awards under the 1998 Stock Plan.

Stock Options. The 1998 Stock Plan permits the granting of (i) options to
purchase Common Stock intended to qualify as incentive stock options under
Section 422 of the Code ("Incentive Options") and (ii) options that do not so
qualify ("Non-Qualified Options"). Only employees of the Company and its
subsidiaries may be granted Incentive Options. The option exercise price of
each option will be determined by the Compensation Committee but may not be
less than 100% of the fair market value of the Common Stock on the date of
grant in the case of Incentive Options, and may not be less than 85% of the
fair market value of the Common Stock on the date of grant in the case of Non-
Qualified Options.

The term of each option will be fixed by the Compensation Committee and may
not exceed ten years from the date of grant in the case of an Incentive
Option. The Compensation Committee will determine at what time or times each
option may be exercised and, subject to the provisions of the 1998 Stock Plan,
the period of time,

47
<PAGE>

if any, after retirement, death, disability or termination of employment
during which options may be exercised. Options may be made exercisable in
installments, and the exercisability of options may be accelerated by the
Compensation Committee.

Upon exercise of options, the option exercise price must be paid in full
either in cash or by certified or bank check or other instrument acceptable to
the Compensation Committee or, if the Compensation Committee so permits, by
delivery of shares of Common Stock already owned by the optionee. The exercise
price may also be delivered to the Company by a broker pursuant to irrevocable
instructions to the broker from the optionee.

At the discretion of the Compensation Committee, stock options granted under
the 1998 Stock Plan may include a "re-load" feature pursuant to which an
optionee exercising an option by the delivery of shares of Common Stock would
automatically be granted an additional stock option (with an exercise price
equal to the fair market value of the Common Stock on the date the additional
stock option is granted) to purchase that number of shares of Common Stock
equal to the number delivered to exercise the original stock option. One of
the purposes of this feature is to enable participants to maintain an equity
interest in the Company without dilution.

To qualify as Incentive Options, options must meet additional U.S. Federal
tax requirements, including limits on the value of shares subject to Incentive
Options which first become exercisable in any one calendar year, and a shorter
term and higher minimum exercise price in the case of certain large
stockholders.

Stock Options Granted to Independent Directors. The 1998 Stock Plan provides
for the automatic grant to each Independent Director of a Non-Qualified Option
to purchase 20,000 shares of Common Stock in connection with the consummation
of the Offering. The 1998 Stock Plan also provides for the automatic grant to
each Independent Director of a Non-Qualified Option to purchase 20,000 shares
of Common Stock upon his or her initial election to the Board of Directors
following the Offering. Each Independent Director who is serving as a director
of the Company on the fifth business day after each annual meeting of
stockholders, beginning with the 1999 annual meeting of stockholders, will
also automatically be granted on such day a Non-Qualified Option to acquire
5,000 shares of Common Stock. In addition, the Independent Director who serves
as chairman of the Audit Committee of the Board of Directors will receive
options to purchase an additional 5,000 shares of Common Stock upon
consummation of the Offering and an additional 5,000 shares of Common Stock on
the fifth business day after each annual meeting of stockholders beginning
with the 1999 annual meeting. The exercise price of each such Non-Qualified
Option will be the fair market value of the Common Stock on the date of grant.
All of such Non-Qualified Options granted to Independent Directors shall vest
50% upon the first anniversary of the grant date, and the remaining 50% shall
vest in equal annual installments over the number of years remaining in each
Director's term as of the first anniversary of the date of grant and shall
terminate on the tenth anniversary of the date of grant.

Stock Appreciation Right. The Compensation Committee may award a stock
appreciation right ("SAR") either as a freestanding award or in tandem with a
stock option. Upon exercise of the SAR, the holder will be entitled to receive
an amount equal to the excess of the fair market value on the date of exercise
of one share of Common Stock over the exercise price per share specified in
the related stock option (or, in the case of freestanding SAR, the price per
share specified in such right, which price may not be less than 85% of the
fair market value of the Common Stock on the date of grant) times the number
of shares of Common Stock with respect to which the SAR is exercised. This
amount may be paid in cash, Common Stock, or a combination thereof, as
determined by the Committee. If the SAR is granted in tandem with a stock
option, exercise of the SAR cancels the related option to the extent of such
exercise.

Restricted Stock. The Compensation Committee may also award shares of Common
Stock to officers, other employees and key persons of the Company subject to
such conditions and restrictions as the Compensation Committee may determine
("Restricted Stock"). These conditions and restrictions may include the
achievement of certain performance goals and/or continued employment with the
Company through a specified restricted period. The purchase price of shares of
Restricted Stock will be determined by the Compensation Committee. If

48
<PAGE>

the performance goals and other restrictions are not attained, the employees
will forfeit their awards of Restricted Stock.

Unrestricted Stock. The Compensation Committee may also grant shares (at no
cost or for a purchase price determined by the Committee) which are free from
any restrictions under the 1998 Stock Plan ("Unrestricted Stock").
Unrestricted Stock may be issued to employees and key persons in recognition
of past services or other valid consideration, and may be issued in lieu of
cash bonuses to be paid to such employees and key persons.

Performance Share Awards. The Compensation Committee may also grant
performance share awards to employees or other key persons of the Company
entitling the recipient to receive shares of Common Stock upon the achievement
of individual or Company performance goals and such other conditions as the
Compensation Committee shall determine ("Performance Share Award").

Dividend Equivalent Rights. The Compensation Committee may grant dividend
equivalent rights, which give the recipient the right to receive credits for
dividends that would be paid if the grantee had held specified shares of
Common Stock. Dividend equivalent rights may be granted as a component of
another award or as a freestanding award. Dividend equivalents credited under
the 1998 Stock Plan may be paid currently or be deemed to be reinvested in
additional shares of Common Stock, which may thereafter accrue additional
dividend equivalents at fair market value at the time of deemed reinvestment
or on the terms then governing the reinvestment of dividends under the
Company's dividend reinvestment plan, if any. Dividend equivalent rights may
be settled in cash, shares, or a combination thereof, in a single installment
or installments, as specified in the award. Awards payable in cash on a
deferred basis may provide for crediting and payment of interest equivalents.

Adjustments for Stock Dividends, Mergers, Etc. The Compensation Committee
will make appropriate adjustments in outstanding awards to reflect stock
dividends, stock splits and similar events. In the event of a merger,
liquidation, sale of the Company or similar event, the Compensation Committee,
in its discretion, may provide for substitution or adjustments of outstanding
options and SARs, or may terminate all unexercised options and SARs with or
without payment of cash consideration.

Amendments and Termination. The Board of Directors may at any time amend or
discontinue the 1998 Stock Plan and the Compensation Committee may at any time
amend or cancel outstanding awards for the purpose of satisfying changes in
the law or for any other lawful purpose. No such action may be taken, however,
which adversely affects any rights under outstanding awards without the
holder's consent. Further, amendments to the 1998 Stock Plan shall be subject
to approval by the Company's stockholders if and to the extent required by the
Securities Exchange Act of 1934, as amended (the "1934 Act"), to ensure that
awards granted under the 1998 Stock Plan are exempt under Rule 16b-3
promulgated under the 1934 Act, or required by the Code to preserve the
qualified status of Incentive Options.

Change in Control Provisions. The 1998 Stock Plan provides that in the event
of a sale of all or substantially all of the assets or Common Stock of the
Company, a merger or consolidation which results in a change in control of the
Company or the liquidation or dissolution of the Company (a "Change in
Control"), all stock options and stock appreciation rights shall automatically
become fully exercisable. In addition, at any time prior to or after a Change
in Control, the Compensation Committee may accelerate awards and waive
conditions and restrictions on any awards to the extent it may determine
appropriate.

U.S. FEDERAL INCOME TAX CONSEQUENCES

Non-Qualified Stock Options. The grant of a Non-Qualified Option will not
result in the recognition of taxable income by the participant or in a
deduction to the Company. Upon exercise, a participant will recognize ordinary
income in an amount equal to the excess of the fair market value of the
Company's Common Stock purchased over the exercise price. The Company is
required to withhold tax on the amount of income so recognized, and a tax
deduction is allowable equal to the amount of such income (subject to the
satisfaction of

49
<PAGE>

certain conditions in the case of options exercised by Section 162(m)
officers). Gain or loss upon a subsequent sale of any of the Company's Common
Stock received upon the exercise of a Non-Qualified Option generally would be
taxed as capital gain or loss (long-term or short-term, depending upon the
holding period of the Common Stock sold). Certain additional rules apply if
the exercise price for an option is paid in Common Stock previously owned by
the participant.

Incentive Stock Options. Upon the grant or exercise of an Incentive Stock
Option within the meaning of Section 422 of the Code, no income will be
realized by the participant for federal income tax purposes and the Company
will not be entitled to any deduction. However, the excess of the fair market
value of the Company's Common Stock as of the date of exercise over the
exercise price will constitute an adjustment to taxable income for purposes of
the alternative minimum tax. If the shares of the Company's Common Stock are
not disposed of within the one-year period beginning on the date of the
transfer of such Common Stock to the participant, or within the two-year
period beginning on the date of grant of the option, any profit realized by
the participant upon the disposition of such Common Stock will be taxed as
long-term capital gain and no deduction will be allowed to the Company. If the
shares of the Company's Common Stock are disposed of within the one-year
period from the date of transfer of such Common Stock to the participant or
within the two-year period from the date of grant of the option, the excess of
the fair market value of the Common Stock upon the date of exercise or, if
less, the fair market value on the date of disposition, over the exercise
price will be taxable as ordinary income of the participant at the time of
disposition, and a corresponding deduction will be allowable. Certain
additional rules apply if the exercise price for an option is paid in Common
Stock previously owned by the participant. If an option intended to qualify as
an Incentive Option is exercised by a person who was not continually employed
by the Company or certain of its affiliates from the date of grant of such
option to a date not more than three months prior to such exercise (or one
year if such person is disabled), then such option will not qualify as an
Incentive Option and will instead be taxed as a Non-Qualified Option, as
described above.

OPTION GRANTS

In October 1998, the Company granted Non-Qualified Options under the 1998
Stock Plan to the following persons who will be officers of the Company
following the consummation of the Offering: Glenn F. Gillam (75,000 shares),
Murray Rosen (50,000 shares), Sidney D. Rogers, Jr. (50,000 shares), Thomas
Studer (40,000 shares) and Douglas H. Holstein (30,000 shares). These options
were issued at an exercise price of $11.25, the estimated fair market value at
the date of grant. One-fourth of these options become exercisable on each of
the first, second, third and fourth anniversaries of the date of grant. See
"Certain Transactions." In addition, upon consummation of the Offering, the
Company will grant to certain employees of the Company, including Glenn F.
Gillam who will receive options for an additional 25,000 shares of Common
Stock, Doug Holstein who will receive options for an additional 20,000 shares
of Common Stock, Sidney D. Rogers, Jr. who will receive options for an
additional 20,000 shares of Common Stock and Marty D. Carter who will receive
options for 20,000 shares of Common Stock, options under the 1998 Stock Plan
to purchase an aggregate of 650,000 shares of Common Stock. Each such option
will have a per share price equal to the Offering price, will expire ten years
from the date of grant and generally will become exercisable as to one-fourth
of the shares covered by such option on each of the first, second, third and
fourth anniversaries of the date of grant.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

All executive officer compensation decisions will be made by the
Compensation Committee. The Compensation Committee will review and make
recommendations regarding the compensation for management and key employees of
the Company, including salaries and bonuses.

50
<PAGE>

CERTAIN TRANSACTIONS

ORGANIZATION OF THE COMPANY

The Combination will be accomplished through separate purchases by the
Company of all of the issued and outstanding capital stock of each of Merkert
and Rogers. As a result, after the closing of the Combination and the Offering
(the "Closing"), each of Merkert and Rogers will exist as a separate wholly
owned subsidiary of the Company. The stock purchase agreement with Merkert
provides for the Company to pay the stockholders of Merkert (i) a fixed amount
of cash at the Closing and (ii) shares of Common Stock at the Closing having a
fixed dollar value, with the final number of shares being determined by the
Offering Price. The stock purchase agreement with Rogers provides for the
Company to pay the stockholders of Rogers a fixed amount of cash at the
Closing.

The aggregate consideration to be paid by the Company in the Combination
consists of approximately $74.1 million consisting of approximately $56.6
million in cash (representing approximately 92.2% of the net proceeds of the
Offering) and 1,166,667 shares of Common Stock (assuming an initial public
offering price of $15.00 per share).

The consideration to be paid for each of Merkert and Rogers was determined
through arm's length negotiations between the Company and representatives of
each of Merkert and Rogers. The factors considered by the parties in
determining the consideration to be paid included, among others, the
historical revenues and pro forma EBITDA of each of Merkert and Rogers.

In connection with the Combination, the former stockholders of each of
Merkert and Rogers who will become directors and/or executive officers of the
Company will receive the following consideration pursuant to the Combination:

<TABLE>
<CAPTION>
SHARES OF
CASH COMMON STOCK
---------- ------------
<S> <C> <C>
Gerald R. Leonard...................................... $ 85,526* 5,889
Douglas H. Holstein.................................... 3,700,000 0
Sidney D. Rogers, Jr................................... 69,957* 4,851
Marty D. Carter........................................ 1,250,000 0
Glenn F. Gillam........................................ 56,133* 3,742
</TABLE>
- --------
* Includes cash paid to the Merkert Enterprises, Inc. Employee Stock
Ownership Trust and allocable to such individuals.

In addition, certain expenses incurred by the former stockholders of each of
Merkert and Rogers in connection with the Combination will be paid by the
Company.

As a result of negotiations between the stockholders of Rogers and Merkert
American Corporation regarding the purchase of Rogers, in connection with the
Combination, Messrs. Holstein and Carter, together with certain other former
stockholders of Rogers, will receive (i) the net proceeds, estimated to be
approximately $2,500,000 (of which 10% will be paid to Mr. Holstein and 10%
will be paid to Mr. Carter), resulting from the sale by Rogers to a third
party of its Charlotte, North Carolina headquarters, (ii) cash bonuses in an
aggregate amount equal to approximately $[950,000] (of which [28]% will be
paid to Mr. Holstein and [10]% will be paid to Mr. Carter) based upon certain
income tax refunds receivable by the Company and (iii) cash bonuses,
previously accrued by Rogers, in the aggregate amount of approximately
$600,000.

In connection with the Combination, the Company expects to use a portion of
the net proceeds of the Offering or borrowings available under the Term Loan
to fund the buyouts of Merkert Enterprises, Inc.'s employment arrangements
with Messrs. Merkert and Crane for cash payments of $876,924 and $583,900,
respectively. In connection with such buyouts, the Company will also provide
family health insurance benefits and disability insurance coverage for three
years to Mr. Merkert and will transfer two automobiles to Messrs. Merkert and
Crane.

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<PAGE>

The consummation of the Combination is subject to completion of the Offering
and customary conditions including, among others, the continuing accuracy at
the Closing of the representations and warranties made by Merkert or Rogers,
as appropriate, and the Company in the stock purchase agreements, receipt of
all necessary consents and approvals, delivery of opinions of counsel, the
performance of covenants included in the agreements relating to the
Combination, and the nonexistence of a material adverse change in the business
of each of Merkert and Rogers. The stock purchase agreements provide that the
stockholders of Merkert and Rogers, respectively, will indemnify the Company
against certain liabilities, including breaches of Merkert's or Rogers'
representations and warranties thereunder, as appropriate.

In connection with the founding and organization of the Company, on March 4,
1998, Monroe & Company II, LLC purchased 1,319,444 shares of Common Stock for
an aggregate purchase price of $150. On May 11, 1998, Monroe & Company, LLC, a
Delaware limited liability company, entered into a consulting agreement with
the Company pursuant to which Monroe & Company, LLC was engaged to render
certain business consulting, financial advisory and investment banking
services to the Company on an exclusive basis for three years. Pursuant to the
consulting agreement, Monroe & Company, LLC will be paid a financial advisory
fee equal to (i) 5% of any consideration paid by the Company in connection
with any transaction which results in the merger, consolidation or combination
of the Company and a third party, the acquisition by the Company of the
capital stock or assets of a third party or a joint venture with any third
party ("Consideration") up to $1 million, plus (ii) 4% of the Consideration
paid in excess of $1 million and up to $2 million, plus (iii) 3% of the
Consideration paid in excess of $2 million and up to $3 million, plus (iv) 2%
of the Consideration paid in excess of $3 million and up to $4 million, plus
(v) 1% of the Consideration paid in excess of $4 million. Under the consulting
agreement, Monroe & Company, LLC will also be paid a fee equal to 0.75% of any
principal amount committed under a senior credit facility for the Company from
a lending institution. An additional fee shall be payable to Monroe & Company,
LLC upon increases in such amount or upon refinancings with a new lender
during the term of the consulting agreement. Monroe & Company, LLC will also
be entitled to consulting fees based on projects and fee schedules to be
mutually agreed upon by Monroe & Company, LLC and the independent directors of
the Company. The Company has agreed to indemnify Monroe & Company, LLC against
certain liabilities.

During 1997, certain members of the management team and consultants were
assembled, and subsequently Monroe & Company II, LLC was organized to pursue
the consolidation of companies in the food brokerage industry. Mr. Monroe, who
will become Non-Executive Chairman of the Board of the Company upon
consummation of the Offering, is a member and the sole manager of Monroe &
Company II, LLC and Monroe & Company, LLC, and Mr. Grace, who will become a
director of the Company upon consummation of the Offering, is a member of
Monroe & Company II, LLC. Monroe & Company II, LLC provided the Company with
advice and expertise regarding the consolidation process. Expenses paid by the
Company prior to the Closing in connection with the Combination and the
Offering have been financed with funds advanced to the Company by Monroe &
Company II, LLC. Outstanding advanced amounts bear interest at the applicable
federal rate in effect under Section 1274(d) of the Internal Revenue Code of
1986, as amended, as of the respective dates on which the advances were made,
compounded semi-annually. The Company will repay the advanced amounts plus
interest to Monroe & Company II, LLC at the Closing out of the proceeds of the
Offering. See "Use of Proceeds." Monroe & Company II, LLC has advanced
approximately $500,000 to the Company for such expenses.

In April 1998, Gerald R. Leonard, who will become Chairman of the Board,
Chief Executive Officer and President of the Company upon the consummation of
the Offering, purchased 263,889 shares of Common Stock from the Company for an
aggregate purchase price of $1,500,000. The purchase price for such stock was
paid by a promissory note from Mr. Leonard to the Company in the principal
amount of $1,500,000 (the "Leonard Note"). The Leonard Note provides that
amounts outstanding thereunder will bear interest at a rate per annum of 6%,
compounded semi-annually and that the entire principal amount and accrued
interest will be due and payable on April 8, 2003. Mr. Leonard's obligations
under the Leonard Note are secured by a pledge of the 263,889 shares of Common
Stock purchased thereby pursuant to a stock pledge agreement. The Leonard Note
is a recourse

52
<PAGE>

obligation of Mr. Leonard with respect to the sum of (i) the outstanding
principal amount from time to time less $750,000 (but not less than $0) plus
(ii) one-half of the accrued and unpaid interest at such time.

In October 1998, the Company granted Non-Qualified Options under the 1998
Stock Plan to the following persons who will be officers of the Company
following the consummation of the Offering: Glenn F. Gillam (75,000 shares),
Murray Rosen (50,000 shares), Sidney D. Rogers, Jr. (50,000 shares), Thomas
Studer (40,000 shares) and Douglas H. Holstein (30,000 shares). These options
were issued at an exercise price of $11.25, the estimated fair market value at
the date of grant. One-fourth of these options become exercisable on each of
the first, second, third and fourth anniversaries of the date of grant. In
addition, upon consummation of the Offering, the Company will grant to Glenn
F. Gillam, Sidney D. Rogers, Jr., Doug H. Holstein and Marty D. Carter,
Incentive Options to purchase up to 25,000, 20,000, 20,000 and 20,000 shares
of Common Stock, respectively. These options will have a per share exercise
price equal to the Offering price, will expire ten years from the date of
grant, and will become exercisable as to one-fourth of the shares covered on
each of the first, second, third and fourth anniversaries of the date of
grant.

The Company and Messrs. Monroe and Leonard are parties to a Registration
Rights Agreement dated May 18, 1998, pursuant to which Messrs. Monroe and
Leonard have the right, subject to certain restrictions, beginning on the date
that is 180 days following the completion of the Offering, to cause the
Company to effect a registration of their shares of Common Stock under the
Securities Act, on not more than two occasions. Messrs. Monroe and Leonard
also have certain "piggyback" registration rights in the event the Company
registers any of its securities for either itself or for security holders
exercising their registration rights.

Upon the consummation of the Offering, the Company will also enter into
Registration Rights Agreements with the former stockholders of Merkert,
including Messrs. Leonard, Gillam and Rogers, pursuant to which such former
stockholders will have the right, subject to certain restrictions, to include
their shares of Common Stock received in the Combination in a registration
statement filed by the Company under the Securities Act.

Mr. Monroe represented the Company in connection with each of the
transactions described above.

COMPANY POLICY

The Company's policy is that any future transactions with directors,
officers, employees or affiliates of the Company be approved in advance by a
majority of the Company's Board of Directors, including a majority of the
disinterested members of the Board, and be on terms no less favorable to the
Company than the Company could obtain from non-affiliated parties.

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<PAGE>

PRINCIPAL STOCKHOLDERS

The following table sets forth certain information with respect to the
beneficial ownership of the Company's Common Stock after giving effect to the
Combination, and as adjusted to reflect the Offering, by (i) each person known
by the Company to beneficially own five percent or more of the outstanding
shares of the Common Stock, (ii) each director, nominee for director and
certain executive officers of the Company, and (iii) all directors, nominees
for director and executive officers of the Company as a group. Except as
otherwise indicated, the Company believes that the beneficial owners of the
Common Stock listed below, based on information furnished by such owners, have
sole investment and voting power with respect to such shares, subject to
community property laws where applicable.

<TABLE>
<CAPTION>
SHARES
BENEFICIALLY
OWNED AFTER
NAME OF BENEFICIAL OWNER(1) OFFERING(2)(3) PERCENTAGE
- --------------------------- -------------- ----------
<S> <C> <C>
Gerald R. Leonard(4)................................. 269,778 3.77%
Sidney D. Rogers, Jr.(5)............................. 4,851 *
Glenn F. Gillam(6)................................... 3,742 *
James L. Monroe(7)................................... 1,319,444 18.45
Edward P. Grace, III(8).............................. -- *
James A. Schlindwein(9).............................. 444,978 6.22
Eugene F. Merkert(10)................................ 622,359 8.70
Robert Q. Crane(11).................................. 624,177 8.73
Tuyet Payne(12)...................................... 600,712 8.40
All directors, director nominees and executive
officers as a group (8 persons)..................... 2,042,793 28.57
</TABLE>
- --------
* less than 1%
(1) Unless otherwise indicated, the mailing address for each stockholder and
director is c/o the Company, 490 Turnpike Street, Canton, Massachusetts
02021.
(2) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission. In computing the number of shares of
Common Stock beneficially owned by a person, shares of Common Stock
subject to options held by that person that are currently exercisable or
exercisable within 60 days of this Prospectus are deemed outstanding, but
are not deemed to be outstanding for the purpose of computing the
percentage ownership of any other person.

(3) Share information assumes an initial public offering price of $15.00 per
share. The acquisition agreements for each of Merkert and Rogers specify
the aggregate dollar values, but not the share amounts, of the Common
Stock to be received by their stockholders in the Combination. As a
result, if the initial public offering price is less or greater than
$15.00, the stockholders of Merkert will receive a larger or smaller
number of shares of Common Stock. In addition, the Company will declare a
stock dividend on all outstanding Common Stock prior to the closing of the
Combination such that, without giving effect to the Offering (but giving
effect to the Combination), there will be outstanding a total of 2,750,000
shares of Common Stock. The size of the stock dividend (and, as a result,
the number of shares of Common Stock held by Monroe & Company II, LLC and
Gerald R. Leonard) will vary if the initial offering price is less or
greater than $15.00, with the size of the dividend increasing if the
initial public offering price increases and decreasing if the initial
public offering price decreases.

(4) Includes 4,121 shares of Common Stock held by the Merkert Enterprises,
Inc. Employee Stock Ownership Trust and allocable to Mr. Leonard.

(5) Includes 3,083 shares held by the Merkert Enterprises, Inc. Employee Stock
Ownership Trust and allocable to Mr. Rogers. Excludes 70,000 shares
subject to options not exercisable within 60 days of the Offering.

(6) Includes 3,742 shares held by the Merkert Enterprises, Inc. Employee Stock
Ownership Trust and allocable to Mr. Gillam. Excludes 100,000 shares
subject to options not exercisable within 60 days of the Offering.

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<PAGE>

(7) Includes 1,319,444 shares of Common Stock held by Monroe & Company II,
LLC, of which Monroe & Company, LLC is the sole manager. Mr. Monroe is the
sole manager of Monroe & Company, LLC. Excludes 20,000 shares which may be
acquired upon the exercise of options not exercisable within 60 days of
the Offering to be granted to Mr. Monroe as a Director of the Company upon
consummation of the Offering.

(8) Excludes 20,000 shares which may be acquired upon the exercise of options
not exercisable within 60 days of the Offering to be granted to Mr. Grace
as a Director of the Company upon consummation of the Offering.

(9) Includes 444,978 shares held by the Merkert Enterprises, Inc. Employee
Stock Ownership Trust, of which Mr. Schlindwein is the trustee. Mr.
Schlindwein disclaims beneficial ownership of the shares held by the
Merkert Enterprises, Inc. Stock Ownership Trust. Excludes 25,000 shares
which may be acquired upon the exercise of options not exercisable within
60 days of the Offering to be granted to Mr. Schlindwein as a Director of
the Company upon consummation of the Offering.

(10) Includes 268 shares held by the Merkert Enterprises, Inc. Employee Stock
Ownership Trust and allocable to Mr. Merkert. Also includes 600,682
shares held by the Eugene F. Merkert 1984 Revocable Trust (the "Revocable
Trust"), of which Mr. Merkert is a trustee, and 21,409 shares held by the
Eugene F. Merkert 1991 Charitable Remainder Unitrust (the "Charitable
Trust"), of which Mr. Merkert is a trustee. Voting of the shares held by
the Revocable Trust requires a vote of a majority of the three trustees.
Mr. Merkert disclaims beneficial ownership of the shares held by the
Revocable Trust and the Charitable Trust.

(11) Includes 2,086 shares held by the Merkert Enterprises, Inc. Employee
Stock Ownership Trust and allocable to Mr. Crane. Also includes 600,682
shares held by the Revocable Trust, of which Mr. Crane is a trustee, and
21,409 shares held by the Charitable Trust, of which Mr. Crane is a
trustee. Voting of the shares held by the Revocable Trust requires a vote
of a majority of the three trustees. Mr. Crane disclaims beneficial
ownership of the shares held by the Revocable Trust and the Charitable
Trust.

(12) Includes 30 shares held by the Merkert Enterprises, Inc., Employee Stock
Ownership Trust and allocable to Ms. Payne. Also includes 600,682 shares
held by the Revocable Trust, of which Ms. Payne is a trustee. Voting of
the shares held by the Revocable Trust requires a vote of a majority of
the three trustees. Ms. Payne disclaims beneficial ownership of the
shares held by the Revocable Trust.

55
<PAGE>

DESCRIPTION OF CAPITAL STOCK

AUTHORIZED AND OUTSTANDING CAPITAL STOCK

The authorized capital stock of the Company consists of 54,000,000 shares of
Common Stock, $0.01 par value per share, of which 4,000,000 are designated as
Restricted Common Stock (the "Restricted Common Stock"), and 1,000,000 shares
of undesignated preferred stock issuable in series by the Board of Directors
("Preferred Stock"). There will be 7,150,000 shares of Common Stock, including
260,000 shares of Restricted Common Stock, outstanding after giving effect to
the Offering (assuming no exercise of the Underwriters' over-allotment options
and no exercise of outstanding options). The following summary description of
the capital stock of the Company does not purport to be complete and is
qualified in its entirety by reference to the Company's Amended and Restated
Certificate of Incorporation (the "Certificate") and Amended and Restated By-
laws (the "By-laws"), copies of which are filed as exhibits to the
Registration Statement of which this Prospectus is a part. The Certificate and
By-laws have been adopted by the stockholders of the Company and the Board of
Directors.

Common Stock and Restricted Common Stock. The holders of Common Stock are
entitled to one vote per share on all matters to be voted on by stockholders.
The holders of Restricted Common Stock are entitled to 1/10th of one vote for
each share held on all matters on which they are entitled to vote. Holders of
Restricted Common Stock are entitled to vote on all matters on which holders
of Common Stock are entitled to vote. Holders of Common Stock and Restricted
Common Stock are entitled to receive such dividends, if any, as may be
declared from time to time by the Board of Directors from funds legally
available therefor. See "Dividend Policy." The possible issuance of Preferred
Stock with a preference over Common Stock and Restricted Common Stock as to
dividends could impact the dividend rights of holders of Common Stock and
Restricted Common Stock. Holders of Common Stock and Restricted Common Stock
are not entitled to cumulative voting rights. Therefore, the holders of a
majority of the votes cast in the election of directors can elect all of the
directors then standing for election, subject to the rights of the holders of
any then outstanding Preferred Stock, if and when issued. The holders of
Common Stock and Restricted Common Stock have no preemptive or other
subscription rights, and there are no conversion rights or redemption or
sinking fund provisions with respect to the Common Stock or the Restricted
Common Stock (except for the right, in certain circumstances, to convert
Restricted Common Stock into Common Stock). Upon the voluntary or involuntary
liquidation, dissolution or winding up of the Company, the net assets of the
Company shall be distributed pro rata to the holders of the Common Stock and
Restricted Common Stock in accordance with their respective rights and
interests, subject to the rights and interests of the holders of Preferred
Stock, if and when issued. All outstanding shares of Common Stock and
Restricted Common Stock, including the shares of Common Stock offered hereby,
are, or will be upon consummation of the Offering, fully paid and non-
assessable.

The Certificate and By-laws provide, subject to the rights of the holders of
any Preferred Stock then outstanding, that the number of directors shall be
fixed by the Board of Directors. The directors, other than those who may be
elected by the holders of any Preferred Stock, are divided into two classes
until the Board Conversion. The Certificate further provides that upon the
occurrence of the Board Conversion, each class of the Board of Directors will
be chosen for staggered three-year terms upon the expiration of their then-
current terms and each year one class of directors will be elected by the
stockholders, provided, however, the initial term of the Class III Directors
will expire upon the election and qualification of directors at the annual
meeting of stockholders held in the third year following the Board Conversion.
Subject to any rights of the holders of Preferred Stock to elect directors and
to remove any director whom the holders of any such stock had the right to
elect, any director of the Company may be removed from office only with cause
and by the affirmative vote of at least two-thirds of the total votes which
would be eligible to be cast by stockholders in the election of such director.
See "Management--Board of Directors."

Each share of Restricted Common Stock will automatically convert into Common
Stock on a share for share basis upon a disposition of such shares of
Restricted Common Stock which (i) occurs after the later to occur of (x) the
first day after the second anniversary of the consummation of the Offering and
the Combination and (y) the first day after the first election of Class II
Directors occurring after the consummation of the Offering and the

56
<PAGE>

Combination and (ii) the transferee (whether a natural person or an entity) of
which is not (x) a party (a "Prior Stockholder") which held shares of the
Company's capital stock prior to the Offering or the Combination, (y) a party
related to any Prior Stockholder in any manner described in Section 267(b) or
707(b) of the Internal Revenue Code of 1986, as amended and in effect as of
the date hereof (the "Code"), or (z) a party through which ownership of shares
of the Company's capital stock could be attributed to any Prior Stockholder
under the provisions of Section 318 of the Code.

The Company has applied to list the Common Stock for quotation on the Nasdaq
National Market under the symbol "MERK."

Undesignated Preferred Stock. The Board of Directors is authorized, without
further action of the stockholders of the Company, to issue up to 1,000,000
shares of Preferred Stock in classes or series and to fix the designations,
powers, preferences and the relative, participating, optional or other special
rights of the shares of each series and any qualifications, limitations and
restrictions thereon as set forth in the Certificate. Any such Preferred Stock
issued by the Company may rank prior to the Common Stock as to dividend
rights, liquidation preference or both, may have full or limited voting rights
and may be convertible into shares of Common Stock.

The purpose of authorizing the Board of Directors to issue Preferred Stock
is, in part, to eliminate delays associated with a stockholder vote on
specific issuances. The issuance of Preferred Stock could have the effect of
making it more difficult for a third party to acquire, or of discouraging a
third party from acquiring or seeking to acquire, a significant portion of the
outstanding Common Stock.

CERTAIN PROVISIONS OF CERTIFICATE AND BY-LAWS

General. A number of provisions of the Company's Certificate and By-laws
concern matters of corporate governance and the rights of stockholders.
Certain of these provisions, as well as the ability of the Board of Directors
to issue shares of Preferred Stock and to set the voting rights, preferences
and other terms thereof, may be deemed to have an anti-takeover effect and may
discourage takeover attempts not first approved by the Board of Directors,
including takeovers which certain stockholders may deem to be in their best
interests. To the extent takeover attempts are discouraged, temporary
fluctuations in the market price of the Company's Common Stock, which may
result from actual or rumored takeover attempts, may be inhibited. These
provisions, together with the classified Board of Directors and the ability of
the Board of Directors to issue Preferred Stock without further stockholder
action, also could delay or frustrate the removal of incumbent directors or
the assumption of control by stockholders, even if such removal or assumption
would be beneficial to stockholders of the Company. These provisions also
could discourage or make more difficult a merger, tender offer or proxy
contest, even if a transaction or contest could be favorable to the interests
of stockholders, and could potentially depress the market price of the Common
Stock. The Board of Directors believes that these provisions are appropriate
to protect the interests of the Company and all of its stockholders. The Board
of Directors has no present plans to adopt any other measures or devices which
may be deemed to have an "anti-takeover effect."

Meetings of Stockholders. The Company's By-laws provide that a special
meeting of stockholders may be called only by the Board of Directors unless
otherwise required by law. The Company's By-laws provide that only those
matters set forth in the notice of the special meeting may be considered or
acted upon at such special meeting, unless otherwise provided by law. In
addition, the Company's By-laws set forth certain other requirements, such as
advance notice and informational requirements and time limitations on any
director nomination or any new business which a stockholder wishes to propose
for consideration at an annual meeting of stockholders.

No Stockholder Action by Written Consent. The Certificate provides that for
so long as the Company has a class of stock registered pursuant to the
provisions of the Securities Exchange Act of 1934, as amended, any action
required or permitted to be taken by the stockholders of the Company at an
annual or special meeting of stockholders must be effected at a duly called
meeting and may not be taken or effected by a written consent of stockholders
in lieu thereof.

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<PAGE>

Indemnification and Limitation of Liability. The By-laws provide that
directors and officers of the Company shall be, and in the discretion of the
Board of Directors non-officer employees may be, indemnified by the Company to
the fullest extent authorized by Delaware law, as it now exists or may in the
future be amended, against all expenses and liabilities reasonably incurred in
connection with service for or on behalf of the Company, and further permits
the advancing of expenses incurred in defense of claims. The By-laws also
provide that the right of directors and officers to indemnification shall be a
contractual right and shall not be exclusive of any other right now possessed
or hereafter acquired under any by-law, agreement, vote of stockholders or
otherwise. The Certificate contains a provision permitted by Delaware law that
generally eliminates the personal liability of directors for monetary damages
for breaches of their fiduciary duty, including breaches involving negligence
or gross negligence in business combinations, unless the director has breached
his or her duty of loyalty, failed to act in good faith, engaged in
intentional misconduct or a knowing violation of law, paid a dividend or
approved a stock repurchase in violation of the Delaware General Corporation
Law or obtained an improper personal benefit. This provision does not alter a
director's liability under the federal securities laws. In addition, this
provision does not affect the availability of equitable remedies, such as an
injunction or rescission, for breach of fiduciary duty.

Amendment of the Certificate. The Certificate provides that an amendment
thereof must first be approved by a majority of the Board of Directors and
(with certain exceptions) thereafter approved by the holders of a majority of
the outstanding shares entitled to vote on such amendment, and the affirmative
vote of a majority of the outstanding shares of each class entitled to vote
thereon as a class; provided, however, that the affirmative vote of not less
than two-thirds of the outstanding shares entitled to vote on such amendment,
and the affirmative vote of not less than two-thirds of the outstanding shares
of each class entitled to vote thereon as a class, is required to amend
provisions of the Certificate relating to the establishment, composition and
powers of the Board of Directors and amendments to the Certificate.

Amendment of By-laws. The Certificate provides that the By-laws may be
amended or repealed by the Board of Directors or by the stockholders. Such
action by the Board of Directors requires the affirmative vote of a majority
of the directors then in office. Such action by the stockholders requires the
affirmative vote of the holders of at least two-thirds of the total votes
present and eligible to be cast by holders of voting stock voting as a single
class with respect to such amendment or repeal at an annual meeting of
stockholders or a special meeting called for such purpose, unless the Board of
Directors recommends that the stockholders approve such amendment or repeal at
such meeting, in which case such amendment or repeal shall only require the
affirmative vote of a majority of the total votes present and eligible to be
cast by holders of voting stock voting as a single class with respect to such
amendment or repeal.

Ability to Adopt Stockholder Rights Plan. The Board of Directors may in the
future resolve to issue shares of Preferred Stock or rights to acquire such
shares, to implement a stockholder rights plan which creates voting or other
impediments or under which shares are distributed to a third-party investor, a
group of investors or stockholders or issued to an employee stock ownership
plan to discourage persons seeking to gain control of the Company by means of
a merger, tender offer, proxy contest or otherwise, if such change in control
is not in the best interests of the Company and its stockholders. The Board of
Directors has no present intention of adopting a stockholder rights plan and
is not aware of any attempt to obtain control of the Company.

STATUTORY BUSINESS COMBINATION PROVISION

Upon completion of the Offering, the Company will be subject to the
provisions of Section 203 of the Delaware General Corporation Law ("Section
203"). Section 203 provides, with certain exceptions, that a Delaware
corporation may not engage in any of a broad range of business combinations
with a person, or an affiliate or associate of such person, who is an
"interested stockholder" for a period of three years from the date that such
person became an interested stockholder unless: (i) the transaction resulting
in a person becoming an interested stockholder, or the business combination,
is approved by the board of directors of the corporation before the person
becomes an interested stockholder; (ii) the interested stockholder acquired
85% or more of the

58
<PAGE>

outstanding voting stock of the corporation in the same transaction that makes
it an interested stockholder (excluding shares owned by persons who are both
officers and directors of the corporation, and shares held by certain employee
stock ownership plans); or (iii) on or after the date the person becomes an
interested stockholder, the business combination is approved by the
corporation's board of directors and by the holders of at least 66 2/3% of the
corporation's outstanding voting stock at an annual or special meeting,
excluding shares owned by the interested stockholder. Under Section 203, an
"interested stockholder" is defined (with certain limited exceptions) as any
person that is (i) the owner of 15% or more of the outstanding voting stock of
the corporation or (ii) an affiliate or associate of the corporation and was
the owner of 15% or more of the outstanding voting stock of the corporation at
any time within the three-year period immediately prior to the date on which
it is sought to be determined whether such person is an interested
stockholder.

A corporation may, at its option, exclude itself from the coverage of
Section 203 by amending its certificate of incorporation or by-laws by action
of its stockholders to exempt itself from coverage; provided, however, that
such by-law or charter amendment shall not become effective until 12 months
after the date the stockholders adopt such exclusion. Neither the Certificate
nor the By-laws contains any such exclusion.

TRANSFER AGENT AND REGISTRAR

BankBoston, N.A. is the transfer agent and registrar for the Company's
Common Stock.

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<PAGE>

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of the Combination and the Offering, the Company will have
7,150,000 shares of Common Stock outstanding (assuming the Underwriters' over-
allotment options are not exercised), excluding (i) 245,000 shares issuable
upon exercise of options to purchase shares of Common Stock granted on
October 30, 1998 under the 1998 Stock Plan (ii) 405,000 shares issuable upon
exercise of options to purchase Common Stock to be granted upon consummation
of the Offering and (iii) 279,500 shares of Common Stock reserved for issuance
upon grant or exercise of future awards under the 1998 Stock Plan (1,015,300
shares of Common Stock will be reserved for issuance under the 1998 Stock Plan
if the Underwriters' over-allotment options are exercised in full). Of the
total shares outstanding, only the 4,400,000 shares sold in the Offering will
be freely tradeable without restriction or further registration under the
Securities Act, except for any shares purchased by affiliates of the Company,
which will be subject to the limitations of Rule 144 under the Securities Act
("Rule 144"). All of the remaining 2,750,000 shares outstanding (the
"Restricted Shares") may be sold only pursuant to an effective Registration
Statement filed by the Company or an applicable exemption, including, without
limitation, sales meeting the applicable requirements of Rule 144 under the
Securities Act.

None of the 1,583,333 shares of Common Stock owned by current stockholders
of the Company will be eligible for sale in accordance with Rule 144 prior to
March 4, 1999, at which time 1,319,444 shares of Common Stock will be eligible
for sale in the public market.

In general, Rule 144 as currently in effect provides that any person (or
persons whose shares are aggregated), including a person who may be deemed an
"affiliate" of the Company (as defined under the Securities Act), whose
Restricted Shares have been fully paid for and held for at least one year from
the later of the date of issuance by the Company or acquisition from an
affiliate of the Company is entitled to sell, within any three-month period, a
number of shares that does not exceed the greater of (i) the average weekly
trading volume of the Common Stock during the four calendar weeks preceding
the date on which notice of such sale is filed on Form 144 with the Securities
and Exchange Commission (the "Commission") and (ii) 1% of the shares of Common
Stock then outstanding (approximately 71,500 shares upon consummation of the
Offering). In addition, sales under Rule 144 are subject to certain other
restrictions regarding the manner of sale, required notice and availability of
public information concerning the Company. Persons who are not affiliates at
the time of sale and who have not been affiliates of the Company for at least
90 days prior to a sale, and who have beneficially owned the shares proposed
to be sold for at least two years (including the holding period of any prior
owner other than an affiliate), are entitled to sell such shares under Rule
144(k) without the limitations referenced above. Affiliates, including members
of the Board of Directors and senior management, continue to be subject to the
limitations under Rule 144, including volume of sale limitations for all
shares held by them, regardless of the time period held. Shares of Common
Stock sold by the Company to, among others, its employees, officers and
directors upon exercise of options granted pursuant to written compensation
plans or contracts (including certain options granted under the 1998 Stock
Plan), and in reliance on Rule 701 under the Securities Act, may be resold,
beginning 90 days after the effective date of this Prospectus, in reliance on
Rule 144 by such persons who are not affiliates subject only to the provisions
of Rule 144 regarding manner of sale, and by such persons who are affiliates
subject to all provisions of Rule 144 except its one-year minimum holding
period requirement.

Under the 1998 Stock Plan, the Company is authorized to issue options for up
to thirteen percent of the number of shares of Common Stock outstanding from
time to time, of which 245,000 shares are issuable upon the exercise of
outstanding stock options. Upon consummation of the Offering, 929,500 shares
of Common Stock will be reserved for issuance under the 1998 Stock Plan
(1,015,300 shares of Common Stock will be reserved for issuance under the 1998
Stock Plan if the Underwriters' over-allotment options are exercised in full).
See "Management--1998 Stock Option and Incentive Plan" and "Management--Option
Grants." The Company intends to file a Registration Statement under the
Securities Act to register the shares of Common Stock reserved for issuance
under the 1998 Stock Plan. Such Registration Statement is expected to be filed
as soon as practicable after the date of this Prospectus and will become
automatically effective upon filing. Shares of Common Stock issued upon the
exercise of options under the 1998 Stock Plan after the effective date of such
Registration Statement generally will be available for sale in the open
market, subject to Rule 144 limitations with respect to affiliates, and
subject to the lock-up agreements described below.

60
<PAGE>

LOCK-UP AGREEMENTS

The Company and the holders of all shares of Common Stock outstanding prior
to the Offering, including the directors and officers and the holders of
shares issued in connection with the Combination, holding in the aggregate
2,750,000 shares of Common Stock, have agreed that they will not, except under
the limited circumstances described in the respective lock-up agreements,
without the prior written consent of the U.S. Representatives, agree to sell,
contract to sell or otherwise dispose of any shares of Common Stock of the
Company for a period of 180 days after the date of this Prospectus.

REGISTRATION RIGHTS

Following the Combination, the holders of 2,750,000 shares of Common Stock
will have the right, in certain circumstances, to require the Company to
include their shares in a registration statement filed by the Company under
the Securities Act. In addition, the holders of 1,583,333 of such shares of
Common Stock will have the right, in certain circumstances, beginning on the
date that is 180 days following the consummation of the Offering, to require
the Company to register their shares of Common Stock under the Securities Act.
See "Certain Transactions."

EFFECT OF FUTURE SALES

Prior to the Offering, there has been no trading market for shares of Common
Stock, and the effect, if any, that future market sales of shares of Common
Stock or the availability of shares of Common Stock for sale will have on the
prevailing market prices for the Common Stock cannot be predicted.
Nevertheless, sales of a substantial number of shares in the public market, or
the perception that such sales could occur, could adversely affect prevailing
market prices for the Common Stock and could impair the Company's future
ability to raise capital through an offering of its equity securities. See
"Risk Factors--Possible Future Sales of Shares."

61
<PAGE>

UNDERWRITING

Certain underwriters will act as representatives (the "Representatives") of
each of the underwriters named below (the "Underwriters"). Subject to the
terms and conditions set forth in a purchase agreement (the "Purchase
Agreement") among the Company and the Underwriters, the Company has agreed to
sell to the Underwriters, and each of the Underwriters severally and not
jointly has agreed to purchase from the Company the number of shares of Common
Stock set forth opposite its name below.

<TABLE>
<CAPTION>
NUMBER OF
UNDERWRITER SHARES
----------- ---------
<S> <C>

-----
Total..........................................................
=====
</TABLE>

In the Purchase Agreement, the several Underwriters have agreed, subject to
the terms and conditions set forth therein, to purchase all of the shares of
Common Stock being sold pursuant to such agreement if any of the shares of
Common Stock being sold pursuant to such agreement are purchased. Under
certain circumstances, under the Purchase Agreement, the commitments of non-
defaulting Underwriters may be increased.

The Representatives have advised the Company that the Underwriters propose
initially to offer the shares of Common Stock to the public at the initial
public offering price set forth on the cover page of this Prospectus, and to
certain dealers at such price less a concession not in excess of $ per share
of Common Stock. The Underwriters may allow, and such dealers may reallow, a
discount not in excess of $ per share of Common Stock on sales to certain
other dealers. After the initial public offering, the public offering price,
concession and discount may be changed.

The Company has granted an option to the Underwriters, exercisable for 30
days after the date of this Prospectus, to purchase up to an aggregate of
660,000 additional shares of Common Stock at the initial public offering price
set forth on the cover page of this Prospectus, less the underwriting
discount. The Underwriters may exercise this option solely to cover over-
allotments, if any, made on the sale of the Common Stock offered hereby. To
the extent that the Underwriters exercise such option, each Underwriter will
be obligated, subject to certain conditions, to purchase a number of
additional shares of Common Stock proportionate to such Underwriter's initial
amount reflected in the foregoing table.

At the request of the Company, the Underwriters have reserved for sale, at
the initial public offering price, up to 5% of the shares offered hereby to be
sold to certain directors, officers, and employees of the Company and certain
business associates of the Company. The number of shares of Common Stock
available for sale to the general public will be reduced to the extent such
persons purchase such reserved shares. Any reserved shares which are not
orally confirmed for purchase within one day of the pricing of the Offering
will be offered by the U.S. Underwriters to the general public on the same
terms as the other shares offered hereby.

The Company and holders of all shares of Common Stock outstanding prior to
the Offering, including the Company's executive officers and directors and the
holders of shares of Common Stock issued in connection with the Combination
have agreed, subject to certain exceptions, not to directly or indirectly (i)
offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or
warrant for the sale of or otherwise dispose of or transfer any shares of
Common Stock or securities convertible into or exchangeable or exercisable for
Common Stock, whether now owned or thereafter acquired by the person executing
the agreement or registration statement under the Securities Act with respect
to the foregoing or (ii) enter into any swap or other agreement that
transfers, in whole or in part, the economic

62
<PAGE>

consequence of ownership of the Common Stock whether any such swap or
transaction is to be settled by delivery of Common Stock or other securities,
in cash or otherwise, without the prior written consent of Merrill Lynch on
behalf of the Underwriters for a period of 180 days after the date of this
Prospectus. See "Shares Eligible for Future Sale."

Prior to the Offering, there has been no public market for the Common Stock
of the Company. The initial public offering price will be determined through
negotiations among the Company, the Representatives and the Lead Managers. The
factors considered in determining the initial public offering price, in
addition to prevailing market conditions, are price-earnings ratios of
publicly traded companies that the Representatives believe to be comparable to
the Company, certain financial information of the Company, the history of, and
the prospects for, the Company and the industry in which it competes, and an
assessment of the Company's management, its past and present operations, the
prospects for, and timing of, future revenues of the Company, the present
state of the Company's development, and the above factors in relation to
market value and various valuation measures of other companies engaged in
activities similar to the Company. There can be no assurance that an active
trading market will develop for the Common Stock or that the Common Stock will
trade in the public market subsequent to the Offering at or above the initial
public offering price. See "Risk Factors--Absence of Public Market;
Determination of Offering Price and Fluctuations in Market Price."

The Company has applied to list the Common Stock for quotation on the Nasdaq
National Market under the symbol "MERK."

The Underwriters do not expect sales of Common Stock to any accounts over
which they exercise discretionary authority to exceed 5% of the number of
shares being offered hereby.

The Company has agreed to indemnify the Underwriters against certain
liabilities, including certain liabilities under the Securities Act, or to
contribute to payments the Underwriters may be required to make in respect
thereof.

Until the distribution of the Common Stock is completed, rules of the
Securities and Exchange Commission may limit the ability of the Underwriters
and certain selling group members to bid for and purchase the Common Stock. As
an exception to these rules, the Representatives are permitted to engage in
certain transactions that stabilize the price of the Common Stock. Such
transactions consist of bids or purchases for the purpose of pegging, fixing
or maintaining the price of the Common Stock.

If the Underwriters create a short position in the Common Stock in
connection with the Offering, i.e., if they sell more shares of Common Stock
than are set forth on the cover page of this Prospectus, the Representatives
may reduce that short position by purchasing Common Stock in the open market.
The Representatives may also elect to reduce any short position by exercising
all or part of the over-allotment option described above.

The Representatives may also impose a penalty bid on certain Underwriters
and selling group members. This means that if the Representatives purchase
shares of Common Stock in the open market to reduce the Underwriters' short
position or to stabilize the price of the Common Stock, they may reclaim the
amount of the selling concession from the Underwriters and selling group
members who sold those shares as part of the Offering.

In general, purchases of a security for the purpose of stabilization or to
reduce a short position could cause the price of the security to be higher
than it might be in the absence of such purchases. The imposition of a penalty
bid might also have an effect on the price of the Common Stock to the extent
that it discourages resales of the Common Stock.

Neither the Company nor any of the Underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the
transactions described above may have on the price of the Common Stock. In

63
<PAGE>

addition, neither the Company nor any of the Underwriters makes any
representation that the Representatives will engage in such transactions or
that such transactions, once commenced, will not be discontinued without
notice.

LEGAL MATTERS

Certain legal matters with respect to the validity of the Common Stock
offered hereby will be passed upon for the Company by Goodwin, Procter & Hoar
LLP, Boston, Massachusetts. Certain legal matters relating to the Offering
will be passed upon for the Underwriters by counsel to the Underwriters.

EXPERTS

The financial statements included in this Prospectus and elsewhere in the
Registration Statement, to the extent of and for the periods indicated in the
reports, have been audited by Arthur Andersen LLP, independent public
accountants, or Hege Kramer Connell Murphy & Goldkamp, P.C. as indicated in
their respective reports with respect thereto, and are included herein in
reliance upon the authority of said firms as experts in giving said reports.
Arthur Andersen LLP's report on the financial statements of Merkert
Enterprises, Inc. and subsidiary as of and for the three years ended December
31, 1997, dated May 22, 1998 and included herein, includes a qualification
stating that there exists a substantial doubt about the ability of Merkert
Enterprises, Inc. to continue as a going concern.

64
<PAGE>

AVAILABLE INFORMATION

The Company has filed with the Commission a Registration Statement on Form
S-1 under the Securities Act with respect to the Common Stock offered hereby.
This Prospectus does not contain all of the information set forth in the
Registration Statement, certain portions of which are omitted as permitted by
the rules and regulations of the Commission. For further information
pertaining to the Company and the Common Stock offered hereby, reference is
made to the Registration Statement, including the exhibits thereto and the
financial statements, notes and schedules filed as a part thereof. Statements
contained in this Prospectus regarding the contents of any contract or other
document referred to herein or therein are not necessarily complete, and in
each instance reference is made to the copy of such contract or other document
filed as an exhibit to the Registration Statement or such other documents,
each such statement being qualified in all respects by such reference.

Upon completion of the Offering, the Company will be subject to the
informational requirements of the Securities Exchange Act of 1934, as amended,
and, in accordance therewith, will file reports, proxy statements and other
information with the Commission. Such reports, proxy statements and other
information, as well as the Registration Statement and the exhibits and
schedules thereto, may be inspected, without charge, at the public reference
facility maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Commission's regional offices
located at Seven World Trade Center, New York, New York 10048 and Northwestern
Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-
2511. Copies of such material may also be obtained from the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549,
at prescribed rates. Such materials can also be inspected at a world wide web
site maintained by the Commission at http://www.sec.gov that contains reports,
proxy and information statements and other information regarding registrants
(which, after the Offering, will include the Company) that file electronically
with the Commission.

65
<PAGE>

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
Basis of Presentation................................................... F-2
Notes to Unaudited Pro Forma Combined Financial Statements.............. F-3
Pro Forma Combined Balance Sheet as of June 30, 1998 and notes thereto
(unaudited)............................................................ F-4
Pro Forma Combined Statement of Operations for the Year Ended December
31, 1997 and notes thereto (unaudited)................................. F-7
Pro Forma Combined Statement of Operations for the Six Months Ended June
30, 1998 and notes thereto (unaudited)................................. F-9
HISTORICAL FINANCIAL STATEMENTS
MERKERT AMERICAN CORPORATION
Report of Independent Public Accountants................................ F-11
Balance Sheet........................................................... F-12
Statement of Operations................................................. F-12
Notes to Financial Statements........................................... F-13
MERKERT ENTERPRISES, INC. AND SUBSIDIARY
Report of Independent Public Accountants................................ F-17
Consolidated Balance Sheets............................................. F-18
Consolidated Statements of Operations................................... F-19
Consolidated Statements of Stockholders' Deficit........................ F-20
Consolidated Statements of Cash Flows................................... F-21
Notes to Consolidated Financial Statements.............................. F-22
ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY
Report of Independent Public Accountants................................ F-32
Consolidated Balance Sheets............................................. F-33
Consolidated Statements of Operations................................... F-34
Consolidated Statements of Stockholders' Equity......................... F-35
Consolidated Statements of Cash Flows................................... F-36
Notes to Consolidated Financial Statements.............................. F-37
FITZWATER INC.
Independent Auditors' Report............................................ F-46
Balance Sheet........................................................... F-47
Statements of Income.................................................... F-48
Statement of Stockholders' Equity....................................... F-49
Statements of Cash Flows................................................ F-50
Notes to Financial Statements........................................... F-51
</TABLE>

F-1
<PAGE>

MERKERT AMERICAN CORPORATION, MERKERT AND ROGERS

UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

BASIS OF PRESENTATION

The following unaudited pro forma combined financial statements give effect
to the purchases by Merkert American Corporation (the "Company") of the
outstanding capital stock of Merkert Enterprises, Inc. ("Merkert") and Rogers
American Company, Inc. ("Rogers"). These purchases will occur simultaneously
with the closing of the Company's initial public offering (the "Offering") and
will be accounted for using the purchase method of accounting. Merkert
American Corporation has been designated as the accounting acquiror pursuant
to SAB 97, because it will own the largest portion of Common Stock after the
consummation of the Offering and the Combination.

The unaudited pro forma combined balance sheet gives effect to the
Combination and the Offering as if they had occurred on June 30, 1998. The
unaudited pro forma combined statement of operations for the year ended
December 31, 1997 and the six months ended June 30, 1998 give effect to these
transactions as if they had occurred on January 1, 1997.

The pro forma adjustments discussed herein are based on estimates, and
certain assumptions. It is management's opinion that the final allocation of
the purchase price will not differ materially from the preliminary estimated
amounts. Management anticipates that the final price allocation will be
completed soon after the consummation of the Combination. The pro forma
financial data do not purport to represent what the Company's financial
position or results of operations would actually have been if such
transactions had in fact occurred on those dates and are not necessarily
representative of the Company's financial position or results of operations of
the Company for any future period. The unaudited pro forma combined financial
statements should be read in conjunction with the other financial statements
and notes thereto included elsewhere in this Prospectus. See "Risk Factors"
included elsewhere herein.

F-2
<PAGE>

MERKERT AMERICAN CORPORATION, MERKERT AND ROGERS

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

1. GENERAL

Merkert American Corporation was founded to become a leading national food
broker. The Company has conducted no operations to date and will acquire
Merkert and Rogers concurrently with and as a condition of this Offering.

The historical financial statements reflect the financial position and
results of operations of Merkert and Rogers and were derived from the Merkert
and Rogers financial statements where indicated. The periods included in these
financial statements are as of June 30, 1998 and for the twelve months ended
December 31, 1997 and for the six months ended June 30, 1998. The audited
historical financial statements are included elsewhere herein.

2. PURCHASE OF MERKERT AND ROGERS

Concurrently with and as a condition to the consummation of this Offering,
the Company will purchase all of the outstanding capital stock of Merkert and
Rogers. The Combination will be accounted for using the purchase method of
accounting.

Upon the consummation of the Combination, the Company plans to complete the
integration of the two companies. As part of this integration, the Company has
consolidated several offices in geographic locations in which both Merkert and
Rogers currently operate. The Company has begun achieving significant savings
associated with these consolidations including payroll and other operating
costs associated with reduced headcount and office expenses. In addition, the
Company expects to eliminate several executive, selling and general
administrative personnel that the management of the Company believe will no
longer be required upon the integration.

The estimated results of the Company's plans of integration are not
reflected in the accompanying Pro forma Combined Financial Statements but are
discussed in the footnotes thereto.

Following the Combination, Rogers intends to sell its corporate headquarters
to a third party, Rogers will then distribute the net cash proceeds from the
sale, after paying the related mortgage note payable, to certain stockholders.
In addition Rogers will assign the life insurance policies on key executives
to certain stockholders. Also, the principal stockholders of Rogers have
agreed to transfer a portion of their shares to certain minority stockholders
prior to the Offering. Rogers will record a compensation charge for each of
these events in their financial statements at the date of these events.

Upon the Combination, Merkert intends to settle the employment contracts of
two executives which requires a cash payment of approximately $1,500. Merkert
will record a compensation charge for this amount in its financial statements
at that date.

The consideration to be paid in cash and in shares of Common Stock to the
common stockholders of Merkert and Rogers is as follows: Merkert: cash of
$31,000 and Common Stock of $17,500; Rogers, cash of $25,635. For purposes of
computing the estimated purchase price for accounting purposes, the fair value
of the shares is determined by applying a 15% discount to the expected market
value of the shares issued in connection with the Offering due to restrictions
on the sale and transferability of the shares issued. The shares issued in the
Combination will be unregistered shares. Accordingly, unless registered, these
shares cannot be sold except under Rule 144 or another applicable exemption
from registration under the Securities Act of 1933, as amended (the
"Securities Act"). Additionally, the shares are subject to a six-month
contractual lock-up in favor of the Underwriters. Allocations of the purchase
prices are preliminary and subject to change. The excess of the purchase price
over the fair value of the net liabilities assumed has been assigned to
goodwill, subject to an appraisal of the assets.

F-3
<PAGE>

PRO FORMA COMBINED BALANCE SHEET

JUNE 30, 1998

(IN THOUSANDS OF DOLLARS)

<TABLE>
<CAPTION>
PRO FORMA
PRO FORMA ADJUSTMENTS FOR
ADJUSTMENTS FOR PRO FORMA THE OFFERING AND AS
MERKERT ROGERS COMPANY THE COMBINATION COMBINED THE BORROWING ADJUSTED
-------- ------- ------- --------------- --------- ---------------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Cash and cash
equivalents............ $ 4 $ 199 $ 265 -- $ 468 $ (155) (e) $ 313
Restricted cash......... 597 472 -- -- 1,069 -- 1,069
Accounts Receivable,
net.................... 13,841 10,457 -- -- 24,298 -- 24,298
Inventories............. 1,316 -- -- -- 1,316 -- 1,316
Deferred Income taxes... -- 639 -- -- 639 -- 639
Prepaid expenses and
other.................. 2,188 455 1,950 -- 4,593 -- 4,593
-------- ------- ----- -------- -------- --------- --------
Total current as-
sets................ 17,946 12,222 2,215 -- 32,383 (155) 32,228
Plant and equipment,
net.................... 11,744 5,673 -- $ (3,800) (a) 13,617 -- 13,617
Noncompete agreements,
net ................... 5,688 4,000 -- (7,688) (i) 2,000 -- 2,000
Goodwill................ 16.469 13,780 -- 89,245 (b) 119,494 -- 119,494
Deferred income taxes... -- 149 -- -- 149 -- 149
Other assets............ 1,102 3,378 -- (3,378) (a) 1,102 2,200 (e) 3,302
-------- ------- ----- -------- -------- --------- --------
Total assets......... $ 52,949 $39,202 2,215 $ 74,379 $168,745 $ 2,045 $170,790
======== ======= ===== ======== ======== ========= ========
LIABILITIES AND
STOCKHOLDERS' EQUITY
Accounts payable and
accrued liabilities.... $ 33,437 $ 5,475 1,715 $ (6,737) (g) $ 33,890 $ (5,900) (e) $ 27,990
Current maturities of
long term debt......... 9,486 11,804 500 24,010 (d) 45,800 (44,300) (e) 1,500
Payable to
stockholders........... -- -- -- 56,635 (b) 56,635 (56,635) (e) --
-------- ------- ----- -------- -------- --------- --------
Total current liabil-
ities............... 42,923 17,279 2,215 73,908 136,325 (106,835) 29,490
Long term debt, net of
current portion........ 23,709 21,167 -- (3,800) (a) 17,066 50,000 (e) 67,066
(24,010) (d)
Other................... -- 479 -- -- 479 -- 479
-------- ------- ----- -------- -------- --------- --------
Total liabilities.... 66,632 38,925 2,215 46,098 153,870 (56,835) 97,035
Redeemable Preferred
Stock.................. 5,747 -- -- (5,747) (c) -- -- --
Common stock subject to
redemption............. 1,619 -- -- (1,619) (f) -- -- --
Stockholders' equity
Common Stock........... 14 1 -- 13 (c) 28 44 72
Additional paid in
capital............... 3,126 37 -- 11,684 (h) 14,847 58,836 (e) 73,683
Retained earnings
(Accumulated
deficit).............. (20,286) 239 -- 20,047 (c) -- -- --
Treasury stock......... (3,903) -- -- 3,903 (c) -- -- --
-------- ------- ----- -------- -------- --------- --------
Total stockholders'
equity (deficit).... (21,049) 277 -- 35,647 14,875 58,880 73,755
-------- ------- ----- -------- -------- --------- --------
Total liabilities and
stockholders' equity... $ 52,949 $39,202 2,215 $ 74,379 $168,745 $ 2,045 $170,790
======== ======= ===== ======== ======== ========= ========
</TABLE>

F-4
<PAGE>

NOTES TO UNAUDITED PRO FORMA COMBINED
BALANCE SHEET ADJUSTMENTS

AS OF JUNE 30, 1998

(a) Records the distribution, to certain selling shareholders of Rogers, the
net cash proceeds from the sale of real estate and life insurance policies
with a net book value of $3,378.

(b) Records the goodwill resulting from the Combination of Merkert and Rogers
by the Company. The goodwill is calculated as follows:

<TABLE>
<S> <C>
Cash paid..................................................... $ 56,635
Fair value of shares of common stock issued................... 14,875
Transaction costs............................................. 1,900
--------
73,410
Plus: fair value of net tangible liabilities assumed.......... 48,084
--------
121,494
Less: intangible assets allocated to noncompete agreements.... (2,000)
--------
Goodwill...................................................... $119,494
========
</TABLE>

The pro forma combined balance sheet does not reflect the income tax
liability assumed by certain selling stockholders which is to be paid in
full to the applicable tax authorities at the closing date.

(c) Records the increase in par value for the shares issued to the selling
stockholders of Merkert. Also records the elimination of the historical
equity accounts of Merkert and Rogers.

(d) Records the current portion of the estimated amount of obligations at
Merkert and Rogers assumed by the Company to be settled in full and paid
with a portion of the net proceeds of the Offering.

(e) Records the net proceeds from the Offering, net of Underwriters' discount,
of $61,380. Also records the proceeds from the borrowing of $50,000. Also
allocates to paid-in capital $2,500 of deferred Offering costs, including
$1,950 of costs deferred as of June 30, 1998 and records the anticipated
use of proceeds from the Offering as follows:

<TABLE>
<S> <C>
Net Proceeds and borrowing................................... $111,380
Offering costs............................................... (2,500)
Cash paid to selling shareholders............................ (56,635)
Repayment of bank debt and other notes payable............... (14,700)
Fees associated with borrowing............................... (2,200)
Repayment of acquisition obligations......................... (29,600)
Severance and other amounts, including acquisition costs..... (5,900)
--------
$ (155)

(f) Records the retirement of redeemable preferred and common stock associated
with the Merkert ESOP.

(g) Records the adjustment to accrued liabilities as follows:

Income tax liability assumed by certain selling
shareholders................................................ $(16,850)
Severance and other costs associated with the closure of
certain offices and operations.............................. 8,213
Transaction costs............................................ 1,900
--------
Net reduction to accrued liabilities......................... $ (6,737)
========
</TABLE>

F-5
<PAGE>

(h) Records the paid-in capital resulting from the Combination of Merkert and
Rogers by the Company.

<TABLE>
<S> <C>
Fair value of shares issued.................................. $ 14,875
Less: allocated to common stock.............................. (31)
--------
14,844
Less: Paid in capital recorded on the books of Merkert and
Rogers...................................................... (3,163)
--------
Net increase to paid in capital.............................. $ 11,681
========
</TABLE>

(i) Records the elimination of non-compete agreements associated with the
prepayment of certain acquisition obligations.

F-6
<PAGE>

PRO FORMA COMBINED STATEMENT OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 31, 1997

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
(F)
PRO FORMA PRO FORMA
MERKERT ROGERS COMPANY ADJUSTMENTS COMBINED
-------- ------- ------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Sales................... $ 43,105 $ -- $ -- $ -- $ 43,105
Commission income....... 104,274 82,985 -- -- 187,259
-------- ------- ----- ------- -----------
Revenues................ 147,379 82,985 -- -- 230,364
Cost of sales........... 39,027 -- -- -- 39,027
Selling, general and
administrative
expense................ 102,495 76,384 -- (1,580)(a),(b) 177,299
Depreciation and
Amortization........... 4,484 2,516 -- (1,111)(c) 5,889
-------- ------- ----- ------- -----------
Operating income
(loss)................. 1,373 4,085 -- 2,691 8,149
Interest expense........ 5,010 2,536 -- (1,153)(d) 6,394
Other (income) expense,
net.................... (79) -- -- -- (79)
-------- ------- ----- ------- -----------
Income (loss) before
income taxes........... (3,558) 1,549 -- 3,844 1,834
Provision (benefit) for
income taxes........... (109) 804 -- 939 (e) 1,634
-------- ------- ----- ------- -----------
Net income (loss)....... $ (3,449) $ 745 $ -- $ 2,905 $ 200
======== ======= ===== ======= ===========
Basic net income per
share.................. $ 0.03
===========
Shares used in computing
basic net income per
share(g)............... 7,150,000
===========
Diluted net income per
share.................. $ 0.03
===========
Shares and potential
dilutive shares used in
computing diluted
earnings per share(g).. 7,213,750
===========
</TABLE>

F-7
<PAGE>

NOTES TO UNAUDITED PRO FORMA COMBINED
STATEMENT OF OPERATIONS ADJUSTMENTS

FOR THE YEAR ENDED DECEMBER 31, 1997

(a) Represents the salaries, fringe benefits and other directly attributable
expenses of certain stockholders of Merkert and Rogers who will no longer
be employed per written agreement.

(b) In connection with the Combination and the Offering, the Company has begun
to achieve significant cost savings through the integration of the
operations of Merkert and Rogers. This process has already begun and has
resulted in the integration of the New York City metropolitan region and
the mid-Atlantic region and the closure of a total of seven offices in
such regions. The Company anticipates the integration actions will be
substantially completed by the closing of the Combination and the Offering
and that the savings from the integration actions will be substantially
realized in the remainder of 1998 and in 1999. The savings primarily will
result from the closing of offices due to overlapping geographic coverage
and the elimination of duplicative operations. The cost savings include
the elimination of employee payroll and benefits, certain rental and
office expenses relating to the closing of offices, as well as other
direct costs. These savings will be offset, in part, by an anticipated
loss of revenue resulting from manufacturer conflicts. In addition, the
Company expects to incur an increase in lease expense and a reduction in
depreciation expense as a result of the sale of Rogers' headquarters to a
third party and the related leaseback of the facility to the Company. The
Company expects the impact of these integration adjustments on Pro Forma
Combined EBITDA to be as follows (in thousands):

<TABLE>
<S> <C>
Pro Forma Combined EBITDA ........................................ $14,117
Elimination of salaries, benefits, bonuses and other direct
costs........................................................... 14,456
Elimination of rental and other office expenses.................. 1,084
Loss of revenue resulting from Manufacturer conflicts............ (5,900)
Increase in lease expense resulting from the sale of Rogers'
headquarters and associated leaseback........................... (650)
-------
Pro Forma Combined EBITDA (after integration adjustments)......... $23,107
=======
Pro Forma Combined Net Income..................................... $ 5,737
=======
Net Income Per Share.............................................. $ 0.80
=======
</TABLE>

(c) Represents the net decrease of amortization of goodwill and other
intangibles as a result of the purchase of Merkert and Rogers. The Company
is in the process of allocating the excess purchase price to certain
intangibles and goodwill and has assigned a 40-year life for goodwill and
lives ranging from 5 to 7 years for other intangibles.

(d) Represents the net reduction of interest expense as a result of the
Company's intention to pay down the following obligations with a portion
of the proceeds from the Offering and the term loan:

<TABLE>
<CAPTION>
APPROXIMATE 1997 INTEREST
DESCRIPTION AMOUNT RATE EXPENSE
----------- -------- ----------- -------------
<S> <C> <C> <C>
Term loan.............................. $ 50,000 9.00% $ 4,500
Revolving line of credit............... (6,000) 8.50% (553)
Revolving line of credit............... (8,600) 8.70% (583)
Mortgage note.......................... (3,800) 8.56% (326)
IRS.................................... 10.00% (1,527)
Acquisition obligations of Merkert and
Rogers................................ (29,600) 9.00% (2,664)
-------
$(1,153)
=======
</TABLE>

(e) Represents the adjustment to record the income tax provision after
considering non-deductible goodwill amortization.

(f) The pro forma combined statement of operations excludes approximately $15
million of aggregate non-recurring compensation charges to be recorded in
the fourth quarter of 1998 by Merkert American, Merkert and Rogers prior
to the purchase. These compensation charges relate to: (1) employment
contract settlements of $1,500 paid to certain executives of Merkert who
are departing the Company; (2) the cash and life insurance policies to be
distributed to certain stockholders of Rogers; and (3) the transfer of
shares of common stock of Rogers by the principal stockholders to certain
minority stockholders and (4) a non-cash stock compensation charge related
to the purchase of Common Stock by Gerald R. Leonard recorded in the
second quarter of 1998.

(g) Includes (1) shares to be issued to the stockholders of Merkert, (2)
shares issued to the management of and consultants to the Company, and (3)
shares sold in this Offering together with the Company's borrowings under
the Term Loan necessary to pay the cash portion of the Combination
consideration, retire certain indebtedness relating to outside bank debt
and acquisition obligations of Merkert and Rogers and pay the expenses of
the Offering and the Combination. In addition, shares and potential
dilutive shares used in computing diluted earnings per share include the
dilutive effect of currently outstanding options to purchase shares of
Common Stock.

F-8
<PAGE>

PRO FORMA COMBINED STATEMENT OF OPERATIONS

FOR THE SIX MONTHS ENDED JUNE 30, 1998

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
(F)
PRO FORMA PRO FORMA
MERKERT ROGERS COMPANY ADJUSTMENTS COMBINED
------- ------- ------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Sales................... $21,537 $ -- $ -- $ -- $ 21,537
Commissions............. 46,304 41,642 -- -- 87,946
------- ------- ------- ------ -----------
Total revenue........... 67,841 41,642 -- -- 109,483
Cost of sales........... 19,591 -- -- -- 19,591
Selling, general and
administrative
expense................ 46,786 38,406 1,271 (g) (790)(a),(b) 84,402
(1,271)(g)
Restructuring expense... 520 -- -- (520)(b) --
Depreciation and
amortization........... 2,392 1,154 -- (573)(c) 2,973
------- ------- ------- ------ -----------
Operating income........ (1,448) 2,082 (1,271) 3,154 2,517
Interest expense........ 2,356 1,294 -- (867)(d) 2,783
Other (income) expense,
net.................... 240 (120) -- -- 120
------- ------- ------- ------ -----------
Income (loss) before
income taxes........... (4,044) 908 (1,271) 4,021 (386)
Provision (benefit) for
income taxes........... 100 458 -- (280)(e) (278)
------- ------- ------- ------ -----------
Net income (loss)....... $(4,144) $ 450 $(1,271) $4,301 $ (664)
======= ======= ======= ====== ===========
Basic net income per
share ................. $ (0.09)
Shares used in computing
basic net income per
share(h)............... 7,150,000
===========
Diluted net income per
share ................. $ (0.09)
===========
Shares and potential
dilutive shares used in
computing diluted
earnings per share(h).. 7,150,000
===========
</TABLE>

F-9
<PAGE>

NOTES TO UNAUDITED PRO FORMA COMBINED
STATEMENT OF OPERATIONS ADJUSTMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 1998

(a) Represents the salaries, fringe benefits and other directly attributable
expenses of certain stockholders of Merkert and Rogers who will no longer
be employed per written agreement.

(b) In connection with the Combination and the Offering, the Company intends
to achieve significant cost savings through the integration of the
operations of Merkert and Rogers. As of June 30, 1998 this process has
already begun and has resulted in the integration of two regions and the
closure of a total of seven offices in such regions. Merkert has recorded
a charge of $520 for severance for employees who have been terminated as
of June 30, 1998 pursuant to the integration plan. The Company anticipates
the integration actions will be substantially completed by the closing of
the Combination and the Offering and that the savings from the integration
actions will be substantially realized in the remainder of 1998 and in
1999. The $520 restructuring charge recorded by Merkert in the second
quarter has been eliminated on the Pro Forma Statement of Operations. The
savings primarily will result from the closing of offices due to
overlapping geographic coverage and the elimination of duplicative
operations. The cost savings include the elimination of employee payroll
and benefits, certain rental and office expenses relating to the closing
of offices, as well as other direct costs. These savings will be partially
offset by an anticipated loss of revenue resulting from Manufacturer
conflicts. In addition, the Company expects to incur an increase in lease
expense and a reduction in depreciation expense as a result of the sale of
Rogers' headquarters to a third party and the related leaseback of the
facility to the Company. The Company expects the impact of these
integration adjustments on Pro Forma Combined EBITDA to be as follows (in
thousands):

<TABLE>
<S> <C>
Pro Forma Combined EBITDA......................................... $ 5,370
Elimination of salaries, benefits, bonuses and other direct
costs........................................................... 7,931
Elimination of rental and other office expenses.................. 542
Loss of revenue resulting from Manufacturer conflicts............ (2,300)
Increase in lease expense resulting from the sale of Rogers'
headquarters and associated lease back.......................... (325)
-------
Pro Forma Combined EBITDA (after integration adjustments)......... $11,218
=======
Pro Forma Combined Net Income..................................... $ 2,950
=======
Net Income Per Share.............................................. $ 0.41
=======
</TABLE>

(d) Represents the reduction of interest expense as a result of the Company's
intention to pay down the following obligations with a portion of the
proceeds from the Offering.

<TABLE>
<CAPTION>
APPROXIMATE SIX MONTHS
DESCRIPTION AMOUNT RATE INTEREST EXPENSE
----------- ------- ----------- ----------------
<S> <C> <C> <C>
Term loan............................ $50,000 9.00% $2,250
Revolving line of credit............. (6,000) 8.50% (364)
Revolving line of credit............. (8,600) 8.70% (375)
Mortgage note........................ (3,800) 8.56% (164)
IRS.................................. 10.00% (882)
Acquisition obligations of Merkert
and Rogers.......................... (29,600) 9.00% (1,332)
------
$ (867)
======
</TABLE>

(e) Represents the adjustment to record the income tax provision after
considering non-deductible goodwill amortization.

(f) The pro forma combined statement of operations excludes in the aggregate
approximately $15 million of aggregate, non-recurring compensation charges
to be recorded in the fourth quarter of 1998 by Merkert American, Merkert
and Rogers prior to the purchase. These compensation charges relate to:
(1) employment contract settlements of $1,500 paid to certain executives
of Merkert who are departing the Company; (2) cash and life insurance
policies to be distributed to certain stockholders of Rogers; and (3) the
transfer of shares of common stock of Rogers by the principal stockholders
to certain minority stockholders.

(g) Represents the non cash stock compensation charge related to the April
1998 purchase of 263,889 shares of Common Stock by Gerald R. Leonard for
an aggregate purchase price of $1,500,000.

(h) Includes (1) shares to be issued to stockholders of Merkert and Rogers,
(2) shares issued to the management of and consultants to the Company, and
(3) shares sold in this Offering together with the Company's borrowings
under the Term Loan necessary to pay the cash portion of the Combination
consideration, retire certain indebtedness relating to outside bank debt
and acquisition obligations of Merkert and Rogers and pay the expenses of
the Offering. In addition, shares and potential dilutive shares used in
computing diluted earnings per share include the dilutive effect of
currently outstanding options to purchase shares of Common Stock.

F-10
<PAGE>

After the stock dividend discussed in Note 6 to Merkert American
Corporation's financial statements is effected, we expect to be in a position
to render the following report.

Arthur Andersen LLP
May 22, 1998

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholders of Merkert American Corporation:

We have audited the accompanying balance sheet of Merkert American
Corporation (the "Company") as of March 31, 1998. This balance sheet is the
responsibility of the Company's management. Our responsibility is to express
an opinion on the balance sheet based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the balance sheet is 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 audit provides a reasonable basis
for our opinion.

In our opinion, the balance sheet referred to above presents fairly, in all
material respects, the financial position of Merkert American Corporation as
of March 31, 1998, in conformity with generally accepted accounting
principles.

F-11
<PAGE>

MERKERT AMERICAN CORPORATION

BALANCE SHEET

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
JUNE 30, MARCH 31,
1998 1998
ASSETS ----------- ---------
(UNAUDITED)
<S> <C> <C>
Cash.................................................... $ 265 $500
Deferred Offering and Combination Costs................. 1,950 289
------ ----
Total Assets.......................................... $2,215 $789
====== ====
LIABILITIES AND STOCKHOLDER'S EQUITY
Accrued Expenses........................................ $1,715 289
Notes Payable........................................... 500 500
Preferred Stock, 1,000,000 authorized, 0 shares issued
and outstanding........................................ -- --
Common Stock, $.01 par value--54,000,000 shares
authorized, 1,583,330 shares issued and outstanding.... 16 --
Additional paid-in capital.............................. 2,755 --
Note for sale of common stock........................... (1,500) --
Accumulated deficit..................................... (1,271) --
------ ----
0 0
------ ----
Total Liabilities and Stockholder's Equity............ $2,215 $789
====== ====
</TABLE>

STATEMENT OF OPERATIONS

(IN THOUSANDS)

<TABLE>
<CAPTION>
THREE MONTHS ENDED
JUNE 30, 1998
------------------
(UNAUDITED)
<S> <C>
Compensation Expense......................................... $ 1,271
-------
Net Loss................................................... $(1,271)
=======
</TABLE>

The accompanying notes are an integral part of this balance sheet.

F-12
<PAGE>

MERKERT AMERICAN CORPORATION

NOTES TO FINANCIAL STATEMENTS

(INCLUDES CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

1. BUSINESS AND ORGANIZATION

Merkert American Corporation (the "Company") was incorporated on March 4,
1998 in order to create a leading national food broker through the acquisition
of Merkert Enterprises, Inc. and Subsidiary ("Merkert") and Rogers-American
Company, Inc. and Subsidiary ("Rogers"). These acquisitions (hereinafter
referred to as the "Combination") will occur concurrently with and as a
condition of an initial public offering (the "Offering"). The Company intends
to complete the Offering of its common stock and subsequent to the Offering
continue to acquire, through merger or purchase, similar companies in order to
expand its regional and national operations.

The Company's primary assets at June 30, 1998 are cash and deferred Offering
and Combination costs. The Company's only operations to date have related to
the Offering and the Combination. The Company received $500,000 in cash in
exchange for a note payable. As of June 30, 1998, the Company has used
$235,000 of cash to fund certain offering costs, the remaining offering costs
incurred of $1,715,000 are included as accrued expenses on the June 30, 1998
Balance Sheet. [Funding for the deferred Offering and Combination costs has
been provided by Monroe & Company II, LLC] (See Note 3).

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies followed in
the preparation of these financial statements.

Unaudited Interim Financial Information

The financial statements as of June 30, 1998 and for the three months ended
June 30, 1998 are unaudited. The Company believes these financial statements
include all adjustments, consisting of normal recurring adjustments, that the
Company considers necessary for a fair presentation of the financial position
and of the results of operations for the respective periods. It should also be
noted that the results for the interim periods are not necessarily indicative
of the results expected for any other interim period or the full year.

Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements. Actual results could differ from those estimates.

Stock Based Compensation Plans

The Company intends to account for its stock-based compensation plans under
Accounting Principles Board Opinion No. 25. It will adopt the disclosure only
provisions of Statement of Financial Accounting Standards ("SFAS") No. 123
Accounting for Stock-Based Compensation that requires stock-based compensation
to be disclosed at its fair value.

Earnings Per Share

In February, 1997 the Financial Accounting Standard Board issued SFAS No.
128 Earnings per Share. SFAS No. 128 requires the presentation of basic
earnings per share ("EPS") and diluted earnings per share. Basic EPS excludes
dilution and is calculated using the weighted average number of common shares
outstanding for the period. Diluted EPS is calculated using the weighted
average number of common shares and dilutive potential common shares
outstanding for the period. Dilutive potential shares consist of stock options
and are calculated using the treasury stock method.

F-13
<PAGE>

MERKERT AMERICAN CORPORATION

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INCLUDES CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

Deferred Offering and Combination costs

Deferred Offering and Combination costs consist primarily of legal,
accounting and other professional fees incurred in connection with the
Offering and the Combination. All costs associated with the Combination will
be included as a component of purchase price pursuant to the purchase method
of accounting. All costs associated with the Offering will be charged to
Stockholder's Equity as a reduction to the proceeds when the Offering closes.

3. RELATED PARTY TRANSACTIONS

In connection with the founding and organization of the Company, Monroe &
Company II, LLC purchased [ ] shares of Common Stock for an aggregate
purchase price of $150. On May 11, 1998, Monroe & Company, LLC entered into a
consulting agreement with the Company pursuant to which Monroe & Company, LLC
was engaged to render certain business consulting, financial advisory and
investment banking services to the Company on an exclusive basis for three
years. Pursuant to the consulting agreement, Monroe & Company, LLC will be
paid a financial advisory fee equal to (i) 5% of any consideration paid by the
Company in connection with any transaction which results in the merger,
consolidation or combination of the Company and a third party, the acquisition
by the Company of the capital stock or assets of a third party or a joint
venture with any third party ("Consideration") up to $1 million, plus (ii) 4%
of the Consideration paid in excess of $1 million and up to $2 million, plus
(iii) 3% of the Consideration paid in excess of $2 million and up to $3
million, plus (iv) 2% of the Consideration paid in excess of $3 million and up
to $4 million, plus (v) 1% of the Consideration paid in excess of $4 million.
Under the consulting agreement, Monroe & Company, LLC will also be paid a fee
equal to 0.75% of any principal amount committed under a senior credit
facility for the Company from a lending institution. An additional fee shall
be payable to Monroe & Company, LLC upon increases in such amount or upon
refinancings with a new lender during the term of the consulting agreement.
Monroe & Company, LLC will also be entitled to consulting fees based on
projects and fee schedules to be mutually agreed upon by Monroe & Company, LLC
and the independent directors of the Company (the "Board"). All fees related
to financial advisory services and private placement will be paid to Monroe &
Company, LLC in cash at the closing of the respective transaction. Consulting
fees are paid on a monthly basis as services are rendered.

In April 1998, Gerald R. Leonard, who will become Chairman of the Board,
Chief Executive Officer and President of the Company upon consummation of the
Offering, purchased 263,889 shares of Common Stock from the Company for an
aggregate purchase price of $1,500,000. As a result, the Company recorded a
non-recurring compensation charge of $1,271,000 in the second quarter of 1998.
The purchase price for such stock was paid by a promissory note from Mr.
Leonard to the Company in the principal amount of $1,500,000 (the "Leonard
Note"). The Leonard Note provides that amounts outstanding thereunder will
bear interest at a rate of 6% per annum, and that the entire principal amount
and accrued interest will be due and payable on April 8, 2003. Mr. Leonard's
obligations under the Leonard Note are secured by a pledge of the 263,889
shares of Common Stock purchased thereby pursuant to a stock pledge agreement.
The Leonard Note is a recourse obligation of Mr. Leonard with respect to the
sum of (i) the outstanding principal amount from time to time less $750,000
(but not less than zero dollars) and (ii) one-half of the accrued and unpaid
interest at such time.

4. CAPITAL STOCK

Upon amendment and restatement of the Company's Certificate of
Incorporation, the Company's authorized capital stock will consist of
50,000,000 shares of Common Stock, $.01 par value per share, and 1,000,000
shares of undesignated preferred stock.

Common Stock

At June 30, 1998, there were 1,583,333 shares of Common Stock outstanding.
Holders of Common Stock are entitled to one vote for each share held of record
on all matters to be submitted to a vote of the stockholders.

F-14
<PAGE>

MERKERT AMERICAN CORPORATION

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INCLUDES CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

In the event of any liquidation, dissolution or winding-up of the affairs of
the Company, holders of Common Stock will be entitled to share ratably in the
assets of the Company remaining after payment or provision for payment of all
of the Company's debts and obligations and after liquidation payments to
holders of the outstanding shares of undesignated preferred stock, if any.

Undesignated Preferred Stock

At June 30, 1998, there were no shares of undesignated preferred stock
outstanding. Holders of undesignated preferred stock would have priority over
the holders of Common Stock with respect to dividends, and to other
distributions, including the distribution of assets upon liquidation. The
Board of Directors has the authority, without stockholder authorization, to
issue shares of undesignated preferred stock in one or more series and to fix
the terms, limitations, relative rights and preferences and variations.

5. STOCK OPTION PLAN

The Company has adopted the Merkert American Corporation 1998 Stock Option
and Incentive Plan (the "1998 Stock Plan"), which provides for the award of
incentive stock options ("ISOs"), non-qualified stock options ("NQSOs"), stock
appreciation rights, deferred stock awards, restricted and unrestricted stock
awards, performance share awards and dividend equivalent rights to all
directors and employees of and consultants to the Company. The number of
shares authorized for issuance under the 1998 Stock Plan is 929,500. In
general, the terms of the awards granted will be established by either the
Board of Directors or a committee established by the Board of Directors, which
will consist of no less than two non-employee directors.

In October 1998, the Company granted Non-Qualified Stock Options to purchase
up to 245,000 shares of Common Stock under the 1998 Stock Plan to persons who
will be officers of the Company following the consummation of the Offering.
These options were issued at an exercise price of $11.25 per share (the
estimated fair market value at the date of grant). These options become
exercisable in four annual installments beginning on the first anniversary of
the date of grant. See "Certain Transactions." In addition, in connection with
the Offering, the Company will grant to employees of the Company options under
the 1998 Stock Plan to purchase an aggregate of 405,000 shares of Common
Stock. Each such option will have a per share exercise price equal to the
Offering price, will expire ten years from the date of grant and generally
will become exercisable in four annual installments beginning on the first
anniversary of the date of grant.

6. SUBSEQUENT EVENTS

On May 22, 1998 and as amended on November 3, 1998, Rogers entered into a
stock purchase agreement with Merkert American Corporation and the
stockholders of Rogers. Pursuant to this stock purchase agreement, the Company
will purchase all of the outstanding shares of common stock of Rogers for
approximately $25.6 million. The consummation of the purchase is subject to a
number of conditions, including the successful completion of an initial public
offering of the Common Stock of the Company. There can be no assurances that
this stock purchase agreement will be consummated.

On May 20, 1998 and as amended on November , 1998, Merkert entered into a
stock purchase agreement with Merkert American Corporation and the
stockholders of Merkert. Pursuant to this stock purchase agreement, the
Company will purchase all of the outstanding shares of common and convertible
redeemable preferred stock of Merkert for approximately $48.5 million in cash
and stock of the Company. The consideration shall be reduced by the amount
payable by Merkert as a result of the current examination of Merkert's federal
and state tax filings for 1992, 1993 and 1994. In addition, Merkert is
currently the subject of an audit with respect to its federal income tax
returns for its fiscal years 1995, 1996 and 1997. Also, Merkert has received
written notice from the seller of a food brokerage business acquired by
Merkert alleging that Merkert has breached certain

F-15
<PAGE>

MERKERT AMERICAN CORPORATION

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INCLUDES CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

covenants contained in an agreement with such seller, claiming that such
breaches have caused the acceleration of certain obligations of Merkert to the
seller and have filed an arbitration demand which is currently pending before
the American Arbitration Association. In connection with the acquisition of
Merkert, a portion of the cash purchase price will be held in escrow to cover
potential liabilities resulting from the IRS audit and the arbitration with
the seller of the food brokerage business and the Company does not believe
that the ultimate outcome of these matters will have a material adverse effect
on the Company. The consummation of the purchase is subject to a number of
conditions, including the successful completion of an initial public offering
of the Common Stock of the Company. In addition, Merkert has agreed to settle
the employment contracts of two executives upon the consummation of this stock
purchase agreement and will record a compensation charge of $1,500,000 at that
time. There can be no assurances that the stock purchase agreement will be
consummated.

The Company and Messrs. Monroe and Leonard are parties to a Registration
Rights Agreement, dated May 18, 1998, pursuant to which Messrs. Monroe and
Leonard have the right, subject to certain restrictions, beginning on the date
that is 180 days following the completion of the Offering, to cause the
Company to effect a registration of their shares of Common Stock under the
Securities Act of 1933, as amended (the "Securities Act"), on not more than
two occasions. Messrs. Monroe and Leonard also have certain "piggy-back"
registration rights in the event the Company registers any of its securities
for either itself or for security holders exercising their registration
rights.

In connection with the Combination, the Company will enter into Registration
Rights Agreements with the former stockholders of Merkert and Rogers,
respectively, pursuant to which such former stockholders will have the right,
subject to certain restrictions, to include their shares of Common Stock
received in the Combination in a registration statement filed by the Company
under the Securities Act.

Upon the effective date of the Company's initial public offering as
described elsewhere in this prospectus, the Company expects to declare a stock
dividend of 734.3494 shares of Common Stock and 144.2802 shares of Restricted
Common Stock in respect of each issued and outstanding shares of Common Stock.
All share and per share amounts give effect to such stock dividend.

F-16
<PAGE>

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Merkert Enterprises, Inc. and Subsidiary:

We have audited the accompanying consolidated balance sheets of Merkert
Enterprises, Inc. and Subsidiary ("Merkert") as of December 31, 1996 and 1997,
and the related consolidated statements of operations, stockholders' deficit
and cash flows for each of the three years in the period ended December 31,
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, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Merkert
Enterprises, Inc. and Subsidiary as of December 31, 1996 and 1997, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 1997, in conformity with
generally accepted accounting principles.

The accompanying financial statements have been prepared assuming that
Merkert will continue as a going concern. As discussed in Note 2 to the
financial statements, Merkert has suffered net losses in 1996 and 1997 and has
a net working capital deficiency at December 31, 1997 that raises substantial
doubt about its ability to continue as a going concern. Management's plans in
regard to these matters are also described in Note 2. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.

Arthur Andersen LLP

Boston, Massachusetts
May 22, 1998

F-17
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
JUNE 30,
1996 1997 1998
------- -------- -----------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash.......................................... $ 730 $ 566 $ 4
Restricted cash............................... 368 595 597
Accounts receivable, less allowance for
doubtful accounts of $225, $575 and $575,
respectively................................. 16,708 18,437 13,841
Inventories................................... 1,834 1,911 1,316
Prepaid expenses and advances................. 240 318 2,188
------- -------- --------
Total current assets........................ 19,880 21,827 17,946
------- -------- --------
Property, plant and equipment, net.............. 8,155 12,628 11,744
------- -------- --------
Intangibles, net of amortization................ 18,027 23,613 22,157
------- -------- --------
Other assets.................................... 1,360 631 1,102
------- -------- --------
Total assets................................ $47,422 $ 58,699 $ 52,949
======= ======== ========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Current maturities of long-term debt.......... $ 651 $ 693 $ 706
Revolving line of credit...................... 1,430 5,883 5,622
Current maturities of notes payable and
lease........................................ 2,746 4,085 3,158
Accounts payable.............................. 8,611 8,184 4,386
Accrued expenses.............................. 23,844 27,942 29,051
------- -------- --------
Total current liabilities................... 37,282 46,787 42,923
------- -------- --------
Long-term debt and notes payable, less current
maturities..................................... 15,590 21,278 23,709
------- -------- --------
Commitments and contingencies
Convertible redeemable preferred stock:
$.01 par value, at redemption value--
Authorized--500,000 shares
Issued and outstanding--237,446, 213,566 and
214,544 shares respectively................. 6,360 5,720 5,747
Common Stock, subject to redemption $.01 par
value
Issued and outstanding--370,753 and 411,853
shares, respectively........................... 805 1,619 1,619
Stockholders' deficit:
Common stock, $.01 par value--
Authorized--3,500,000 shares
Issued and outstanding--1,232,582 and
1,224,582 shares, respectively.............. 14 14 14
Additional paid-in capital.................... 3,126 3,126 3,126
Accumulated deficit........................... (12,048) (15,942) (20,286)
Treasury stock--at cost....................... (3,707) (3,903) (3,903)
------- -------- --------
(12,615) (16,705) (21,049)
------- -------- --------
Total liabilities and stockholders'
deficit.................................... $47,422 $ 58,699 $ 52,949
======= ======== ========
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-18
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS
YEAR ENDED DECEMBER 31, ENDED JUNE 30,
--------------------------- ----------------
1995 1996 1997 1997 1998
------- -------- -------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenues:
Commissions.................. $73,336 $ 80,661 $104,274 $51,816 $46,304
Sales........................ 49,233 44,916 43,105 20,864 21,537
------- -------- -------- ------- -------
122,569 125,577 147,379 72,680 67,841
Operating expenses:
Selling expenses............. 45,717 52,510 69,913 37,477 31,272
Cost of sales................ 45,615 41,890 39,027 19,260 19,591
General and administrative... 26,671 28,097 32,582 16,598 15,514
Depreciation and
amortization................ 2,132 2,447 4,484 2,307 2,392
Restructuring Expense........ -- -- -- -- 520
------- -------- -------- ------- -------
Operating income (loss).... 2,434 633 1,373 (2,962) (1,448)
------- -------- -------- ------- -------
Other income (expense):
Interest income.............. 155 133 56 24 --
Interest expense............. (1,660) (2,283) (5,010) (2,393) (2,356)
Other income (expense)....... (122) 247 23 (53) (240)
------- -------- -------- ------- -------
Total other income
(expense)................. (1,627) (1,903) (4,931) (2,422) (2,596)
------- -------- -------- ------- -------
Income (loss) before provision
for income taxes.............. 807 (1,270) (3,558) (5,384) (4,044)
Provision (benefit) for income
taxes......................... 1,268 804 (109) 158 100
------- -------- -------- ------- -------
Net loss................... (461) (2,074) (3,449) (5,542) (4,144)
Preferred stock dividends...... 445 445 445 223 200
------- -------- -------- ------- -------
Net loss applicable to common
stockholders.................. $ (906) $ (2,519) $ (3,894) $(5,765) $(4,344)
======= ======== ======== ======= =======
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-19
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
COMMON STOCK,
$.01 PAR VALUE TREASURY STOCK ADDITIONAL
---------------- ---------------- PAID-IN ACCUMULATED
SHARES AMOUNT SHARES AMOUNT CAPITAL DEFICIT TOTAL
--------- ------ ------- ------- ---------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, December 31,
1994................... 1,447,582 $ 14 -- $ -- $3,126 $ (8,623) $ (5,483)
Net income............ -- -- -- -- -- (461) (461)
Preferred dividend
declared............. -- -- -- -- -- (445) (445)
Purchase of treasury
stock................ -- -- 123,000 2,042 -- -- (2,042)
--------- ---- ------- ------- ------ -------- ---------
Balance, December 31,
1995................... 1,447,582 14 123,000 2,042 3,126 (9,529) (8,431)
Net loss.............. -- -- -- -- -- (2,074) (2,074)
Preferred dividend
declared............. -- -- -- -- -- (445) (445)
Purchase of treasury
stock................ -- -- 92,000 1,665 -- -- (1,665)
--------- ---- ------- ------- ------ -------- ---------
Balance, December 31,
1996................... 1,447,582 14 215,000 3,707 3,126 (12,048) (12,615)
Net loss.............. -- -- -- -- -- (3,449) (3,449)
Preferred dividend
declared............. -- -- -- -- -- (445) (445)
Issuance of stock--
401(k)............... -- -- (10,500) (174) -- -- 174
Purchase of treasury
stock................ -- -- 18,500 370 -- -- (370)
--------- ---- ------- ------- ------ -------- ---------
Balance, December 31,
1997................... 1,447,582 14 223,000 3,903 3,126 (15,942) (16,705)
Net loss (unaudited).. (4,144) (4,144)
Preferred dividend
declared
(unaudited).......... -- -- -- -- -- (200) (200)
--------- ---- ------- ------- ------ -------- ---------
Balance, June 30, 1998
(unaudited)............ 1,447,582 $ 14 223,000 $ 3,903 $3,126 $(20,286) $ (21,049)
========= ==== ======= ======= ====== ======== =========
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-20
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
YEAR ENDED DECEMBER 31, JUNE 30,
------------------------- ----------------
1995 1996 1997 1997 1998
------- ------- ------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Cash flows from operating
activities:
Net loss.......................... $ (461) $(2,074) $(3,449) $(5,542) $(4,144)
Adjustments to reconcile net
loss to net cash provided by
(used in) operating
activities--
Depreciation and amortization... 2,132 2,447 4,484 2,307 2,392
Loss (gain) on disposal of fixed
assets......................... (31) 45 115 9 (224)
Changes in assets and
liabilities, exclusive of
acquisitions--
(Increase) decrease in--
Accounts receivable, net...... (1,269) (1,565) (1,729) (23) 4,596
Inventories, prepaid expenses
and advances................. 189 718 (155) 768 (1,275)
Other assets.................. 86 (348) 527 (155) (468)
Accounts payable.............. 2,868 2,266 (427) (2,447) (3,798)
Accrued expenses.............. 2,664 2,584 4,098 3,058 1,109
------- ------- ------- ------- -------
Net cash provided by (used in)
operating activities......... 6,178 4,073 3,464 (2,025) (1,812)
------- ------- ------- ------- -------
Cash flows from investing
activities:
Additions to property, plant and
equipment...................... (1,435) (3,356) (7,273) (4,523) (541)
Net proceeds from sale of
property, plant and equipment.. 149 117 530 496 512
Acquisitions, net of cash
acquired....................... -- (1,421) (748) (748) --
(Increase) decrease in cash
surrender value, net of
increase in policy loans....... (19) (26) 202 (19) (3)
------- ------- ------- ------- -------
Net cash (used in) provided by
investing activities......... (1,305) (4,686) (7,289) (4,794) (32)
------- ------- ------- ------- -------
Cash flows from financing
activities:
Dividends paid.................. (445) (445) (445) -- --
Borrowings under revolving line
of credit...................... -- 1,430 4,453 5,313 (261)
Issuance (repayment) of long-
term debt...................... -- 1,473 3,419 (86) 2,445
Net (repayment) issuance of
notes payable.................. (275) (1,292) (2,529) 1,038 (927)
Issuance of convertible
preferred stock................ -- -- -- -- 27
Redemption of convertible
preferred stock................ -- -- (640) -- --
Repurchase of treasury stock.... (2,042) (1,665) (370) -- --
------- ------- ------- ------- -------
Net cash (used in) provided by
financing activities......... (2,762) (499) 3,888 6,265 1,284
------- ------- ------- ------- -------
Net increase (decrease) in
cash......................... 2,111 (1,112) 63 (554) (560)
Cash:
Beginning of year............... 99 2,210 1,098 1,098 1,161
------- ------- ------- ------- -------
End of period................... $ 2,210 $ 1,098 $ 1,161 $ 544 $ 601
======= ======= ======= ======= =======
Supplemental disclosures of:
Cash flow information--
Cash payments for--
Interest...................... $ 563 $ 934 $ 3,501 $ 1,100 $ 1,535
======= ======= ======= ======= =======
Income taxes.................. $ 822 $ 1,825 $ 21 $ 6 $ 1,756
======= ======= ======= ======= =======
Non-cash flow information--
Purchase price financed by
seller....................... $ 1,158 $13,947 $ 6,292 $ 6,292 $ --
======= ======= ======= ======= =======
Liabilities assumed........... $ -- $ 724 $ 560 $ 560 $ --
======= ======= ======= ======= =======
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.

F-21
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

1. NATURE OF BUSINESS

Merkert Enterprises, Inc. ("Merkert") is a broker of food and various food-
related products. Merkert provides sales, marketing and merchandising services
to manufacturers ("Manufacturers") of consumer goods and serves as an
intermediary between the Manufacturers and retailers and wholesalers of the
consumer goods. Merkert also provides development, inventory management and
procurement and packaging services of private label frozen fruit and vegetable
products for several retailers. Merkert primarily operates throughout the
northeast and mid-Atlantic regions of the United States.

2. LIQUIDITY

Merkert incurred net losses in 1996 and 1997 and has a net working capital
deficiency of $24,960 as of December 31, 1997, which results in a substantial
doubt about Merkert's ability to continue as a going concern. Management's
plans to alleviate the net working capital deficiency include the sale of all
of the outstanding shares of Merkert's common and convertible redeemable
preferred stock to another entity (see Note 12). This new entity intends to
finance the acquisition through an initial public offering of equity (the
"Offering"). The proceeds from a successful offering will also be used to
repay certain indebtedness of Merkert. Also, Merkert plans to seek to obtain a
new revolving credit facility sufficient to meet Merkert's working capital
requirements. The accompanying consolidated financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The consolidated financial statements include the accounts of Merkert and
its wholly owned subsidiary Merkert Laboratories, Inc. ("Merkert Labs"). All
intercompany accounts and transactions have been eliminated in consolidation.

Unaudited Interim Financial Information

The financial statements as of June 30, 1998 and for the six months ended
June 30, 1997 and 1998 are unaudited. Merkert believes these financial
statements include all adjustments, consisting of normal recurring
adjustments, that Merkert considers necessary for a fair presentation of the
financial position and of the results of operations for the respective
periods.

It should also be noted that the results for the interim periods are not
necessarily indicative of the results expected for any other interim period or
full year.

Use of Estimates

The preparation of consolidated financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

F-22
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

Revenue Recognition

Commissions are earned and recognized upon shipment by the Manufacturer to
the retailer or wholesaler; product sales revenue is recognized upon shipment
by Merkert.

Marketable Securities

Merkert accounts for its marketable securities in accordance with Statement
of Financial Accounting Standards (SFAS) No. 115, Accounting for Certain
Investments in Debt and Equity Securities. Merkert's investments were
classified as available-for-sale and are recorded at market value. During
1995, all investments were sold and the resulting gain of $567 was included in
other income in the consolidated statement of operations.

Inventories

Inventories are primarily finished goods and consist of price marking guns
and labels as well as other supplies purchased by retailers. Inventories are
stated at the lower of cost or market and are valued on a first-in, first-out
(FIFO) basis.

Fair Value

Effective December 31, 1995, Merkert adopted SFAS No. 107, Disclosures About
Fair Value of Financial Instruments. SFAS No. 107 requires that Merkert
disclose estimated fair values for certain of its financial instruments.
Merkert's financial instruments consist of cash, accounts receivable, notes
payable, accounts payable and long-term debt. The carrying value of Merkert's
financial instruments approximates fair value at December 31, 1995, 1996 and
1997.

Concentration of Credit Risk

Financial instruments that potentially subject Merkert to concentrations of
credit risk principally consist of trade receivables. Merkert's trade
receivables result primarily from commission sales. Merkert maintains reserves
for potential credit losses and such losses have been immaterial.

Property and Equipment

Property and equipment are stated at cost. Depreciation is computed
principally by accelerated methods over the estimated useful lives of the
assets.

Intangibles

Intangibles consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------
1996 1997
------- -------
<S> <C> <C>
Goodwill................................................... $17,160 $20,595
Noncompete agreements...................................... 1,857 5,883
------- -------
19,017 26,478
Accumulated amortization................................... (990) (2,865)
------- -------
$18,027 $23,613
======= =======
</TABLE>

F-23
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

Goodwill, the excess of the acquired business purchase price over the fair
value of the acquired assets, is amortized on a straight-line basis over
estimated useful lives which range from 10 to 20 years. Noncompete agreements
are amortized on a straight-line basis over the life of the respective
agreement. Amortization expense was $467, $861 and $2,615 for the years ended
December 31, 1995, 1996 and 1997, respectively.

Income Taxes

Merkert provides for income taxes in accordance with SFAS No. 109,
Accounting for Income Taxes. SFAS No. 109 recognizes tax assets and
liabilities for the cumulative effect of all temporary differences between the
financial statement carrying amounts and the tax basis of assets and
liabilities and are measured using the enacted tax rates which will be in
effect when these differences are expected to reverse.

Impairment of Long-Lived Assets

Merkert evaluates the carrying value of its long-lived assets in accordance
with SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and
Long-Lived Assets to Be Disposed Of. Accordingly, Merkert evaluates the
carrying value of its long-lived assets including equipment and goodwill
whenever events or changes in circumstances indicate that the carrying value
may not be recoverable. Under SFAS No. 121, an assessment is made to determine
whether the sum of the expected future undiscounted cash flows from the use of
the assets and eventual disposition is less than the carrying value. If the
sum of the expected undiscounted cash flows is less than the carrying value,
an impairment loss is recognized by measuring the excess of carrying value
over fair value (generally estimated by projected future discounted cash flows
for the applicable operation or independent appraisal). At December 31, 1996
and 1997, management believes no such impairment of assets was indicated.

Accrued Expenses

Accrued expenses consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
---------------
1996 1997
------- -------
<S> <C> <C>
Accrued compensation......................................... $ 3,125 $ 3,589
Taxes........................................................ 14,353 16,972
Other........................................................ 6,366 7,381
------- -------
$23,844 $27,942
======= =======
</TABLE>

4. ACQUISITIONS

Merkert completed acquisitions of several food brokerage businesses during
1995, 1996 and 1997.

The acquisitions are accounted for using the purchase method of accounting;
accordingly, the results of operations are included in the accompanying
consolidated financial statements from their respective dates of acquisition.
The purchase price has been allocated to assets acquired and liabilities
assumed based upon their estimated fair values at the date of acquisition. A
portion of the purchase price in certain acquisitions is payable contingent
upon achieving defined performance criteria. Merkert's policy is to estimate
the net present value of the expected payments and record that amount as part
of the purchase price. Merkert records any ultimate changes to the estimate as
an adjustment to the goodwill. Purchase price in excess of net identified

F-24
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

tangible and intangible assets is recorded as goodwill and amortized on a
straight-line basis over periods ranging from 10 to 20 years. The following is
a summary of the acquisitions which were consummated in 1995, 1996 and 1997:

<TABLE>
<CAPTION>
PURCHASE PRICE NET
----------------- TANGIBLE
CASH FINANCED ASSETS OTHER
ACQUISITION DATE PAID BY SELLER ACQUIRED GOODWILL INTANGIBLES
----------- ------------ ------ --------- -------- -------- -----------
<S> <C> <C> <C> <C> <C> <C>
Food Service Sales...... January 1995 $ -- $(1,158) $ -- $ 1,158 $ --
ABD Sales, Inc.......... October 1996 (1,121) (9,275) (63) 10,147 312
DelGrosso-Richardson,
Morrison, Inc.......... October 1996 (300) (4,672) 88 3,554 1,330
Toomey-DeLong, Inc. .... January 1997 (635) (5,144) 593 1,160 4,026
Luciano................. January 1997 (113) (1,148) (405) 1,666 --
</TABLE>

Had each of these acquisitions been consummated on January 1, 1996, the
unaudited pro forma revenues and net loss for Merkert for the year ended
December 31, 1996 would have been $164,877 and $(1,787), respectively.

5. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are comprised of the following at December 31,
1996 and 1997:

<TABLE>
<CAPTION>
DEPRECIABLE
1996 1997 LIFE IN YEARS
------- ------- -------------
<S> <C> <C> <C>
Land........................................... $ 693 $ 693 --
Buildings...................................... 5,780 10,113 25-39
Furniture and equipment........................ 4,744 5,590 5
Data processing................................ 4,010 5,497 3
Motor vehicles................................. 1,061 354 5
Leasehold improvements......................... 1,036 217 5
------- -------
17,324 22,464
Less--Accumulated depreciation................. 9,169 9,836
------- -------
$ 8,155 $12,628
======= =======
</TABLE>

Depreciation expense for the years ended December 31, 1995, 1996 and 1997
was $1,665, $1,586 and $1,869, respectively.

6. EMPLOYEE BENEFIT PLANS

Merkert sponsors the Merkert Enterprises, Inc. Employee Stock Ownership Plan
and Trust ("ESOP"). On January 1, 1997, Merkert amended its ESOP to provide
for a contributory plan under the provisions of Section 401(k) (the"401(k)
Plan") of the Internal Revenue Code. As of January 1, 1997, eligible employees
can make voluntary contributions to the 401(k) Plan.

Under the provisions of the 401(k) Plan, Merkert currently matches 100% of
an eligible employee's contribution up to certain limits determined by Merkert
(currently 4%) of the employee's salary. Prior to the adoption of the 401(k)
Plan, Merkert's contributions were made at the discretion of the Board of
Directors.

F-25
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

For the years ended December 31, 1995, 1996 and 1997, Merkert expensed
approximately $2,275, $1,249 and $988, respectively, under the terms of the
ESOP and 401(k) Plans. On December 23, 1997, the Board of Directors authorized
the issuance to the ESOP of 51,600 shares, held as treasury stock to satisfy
the fiscal 1997 obligation. The value of the common stock issued to the 401(k)
was at fair value based on an independent appraisal.

At December 31, 1997, the ESOP owned 25% of the common stock and 100% of the
redeemable convertible preferred stock outstanding. Furthermore, under the
terms of the ESOP, Merkert may be required to repurchase both common and
preferred stock issued to either the ESOP or an employee upon the occurrence
of certain events.

7. CONVERTIBLE REDEEMABLE PREFERRED STOCK

The convertible redeemable preferred stock was issued in September 1991.
Each share is convertible into one share of common stock under certain
circumstances. The convertible redeemable preferred stock is subject to a
cumulative annual dividend of $1.875 per share and has pro rata participation
rights in any common stock dividends. The convertible redeemable preferred
stock is redeemable by the holder at any time; only to the extent necessary
for such holder to provide for distributions to participants in the ESOP. The
preferred stock is redeemable at a price equal to the greater of the appraised
value per share or $26.785 per share plus any unpaid dividends. All shares of
common and convertible redeemable preferred stock have equal voting rights.

8. CONTINGENCIES

Merkert is involved in various legal proceedings which have arisen in the
ordinary course of business. Management believes the outcome of such legal
proceedings will not have a material adverse impact on Merkert's consolidated
financial position or results of operations.

9. COMMITMENTS

Promotional Funds

Certain Manufacturers provide Merkert with funds to be used solely for
advertising and other promotional activities. At December 31, 1996 and 1997,
Merkert had cash of $368 and $595, respectively, use of which was restricted
to payment for promotional activities on behalf of its Manufacturers. The
offsetting liability is included in accrued liabilities in the balance sheet
at December 31, 1996 and 1997.

Legal Proceedings

Merkert has received written notice from the seller of a food brokerage
business acquired by Merkert alleging that Merkert has breached certain
covenants contained in an agreement with such seller, claiming that such
breaches have caused the acceleration of certain obligations of Merkert to
such seller and have filed an arbitration demand which is currently pending
before the American Arbitration Association. Merkert believes that this
matter, if determined adversely to Merkert, would not have a material adverse
effect on Merkert. Merkert is from time to time a party to litigation arising
in the ordinary course of business. There can be no assurance that Merkert's
insurance coverage will be adequate to cover all liabilities occurring out of
such claims. In the opinion of management, any liability that Merkert might
incur upon the resolution of this litigation will not, in the aggregate, have
a material adverse effect on the financial condition or results of operations
of Merkert.

F-26
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

Leases

Merkert leases certain office and warehouse facilities under operating
leases expiring on various dates through 2005.

Rental costs, including real estate taxes, amounted to approximately $3,273,
$3,469 and $4,386 in 1995, 1996 and 1997, respectively.

The following is a schedule of future minimum rental payments exclusive of
real estate taxes required under operating leases that have initial or
remaining noncancelable lease terms in excess of one year as of December 31,
1997:

<TABLE>
<CAPTION>
RENT
PAYMENTS
--------
<S> <C>
Year ending December 31,
1998............................................................... $ 2,559
1999............................................................... 2,232
2000............................................................... 1,740
2001............................................................... 1,458
2002............................................................... 1,462
Thereafter......................................................... 3,094
-------
Total............................................................. $12,545
=======
</TABLE>

10 INCOME TAXES

The provision (benefit) for income taxes for the years ended December 31, is
as follows:

<TABLE>
<CAPTION>
1995 1996 1997
------ ---- -----
<S> <C> <C> <C>
Federal--
Current.................................................. $ 632 $603 $ (82)
Deferred................................................. 320 -- --
------ ---- -----
952 603 (82)
------ ---- -----
State--
Current.................................................. 210 201 (27)
Deferred................................................. 106 -- --
------ ---- -----
316 201 (27)
------ ---- -----
$1,268 $804 $(109)
====== ==== =====
</TABLE>

A reconciliation between the provision for income taxes computed at U.S.
federal statutory rates and the effective rates reflected in the accompanying
consolidated statements of income are as follows:

<TABLE>
<CAPTION>
YEAR ENDED
---------------------
1995 1996 1997
------ ----- -------
<S> <C> <C> <C>
U.S. federal statutory provision.................... $ 274 $(432) $(1,210)
State income taxes, net of federal income tax
effect............................................. 48 (76) (213)
Change in valuation allowance....................... 4 1,137 1,613
Permanent items..................................... 282 314 459
Other............................................... 660 (139) (758)
------ ----- -------
Effective tax provision........................... $1,268 $ 804 $ (109)
====== ===== =======
</TABLE>

F-27
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

The tax effect of temporary differences which give rise to deferred income
tax assets (liabilities) are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------
1996 1997
------- -------
<S> <C> <C>
Assets--
Accrued interest......................................... $ 1,900 $ 2,487
Intangibles.............................................. 244 1,737
Receivable reserves...................................... 90 230
Health insurance......................................... 15 240
Net operating loss....................................... -- 164
Alternative minimum tax credit........................... -- 157
Other.................................................... 1,255 1,062
------- -------
Total assets........................................... 3,504 6,077
------- -------
Valuation allowance...................................... (3,390) (5,003)
------- -------
Total assets, net of valuation allowance............... 114 1,074
------- -------
Liabilities--
Property basis differences............................... -- (264)
Prepaid expenses......................................... (114) (164)
Other.................................................... -- (646)
------- -------
Total liabilities...................................... (114) (1,074)
------- -------
Net assets (liabilities)............................... $ -- $ --
======= =======
</TABLE>

Merkert has provided a valuation allowance on the portion of the net
deferred tax assets that are not likely to be realized. The valuation
allowance increased in fiscal 1997 and fiscal 1996 by approximately $1,613 and
$1,137, respectively.

Merkert's federal and state tax filings for 1992, 1993 and 1994 are
currently under examination by tax authorities. The examinations are not
complete and Merkert expects to challenge certain preliminary conclusions of
the examinations. Merkert has established reserves in various years which it
believes will be adequate to cover the range of potential liability; however,
the ultimate outcome of the matter is uncertain (see Note 12).

F-28
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

11. LONG-TERM DEBT

As of December 31, debt consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
---------------
1996 1997
------- -------
<S> <C> <C>
Revolving line of credit....................................... $ 1,430 $ 5,883
Bank--mortgage and term loans.................................. 2,834 6,253
Commercial promissory notes.................................... 1,951 1,242
Leases......................................................... -- 186
Acquisition Agreement--DRM..................................... 4,577 3,532
Acquisition Agreement--ABD..................................... 8,723 8,513
Acquisition Agreement--FSS..................................... 625 327
Acquisition Agreement--Luciano................................. -- 1,345
Acquisition Agreement--Toomey-DeLong........................... -- 4,509
Other.......................................................... 277 149
------- -------
20,417 31,939
Less--Current maturities....................................... 4,827 10,661
------- -------
Net long-term debt........................................... $15,590 $21,278
======= =======
</TABLE>

The amounts due under the acquisition agreements represent the total
estimated payments to be made pursuant to these agreements. The total
estimated payments have been discounted using a rate of approximately 10%. The
amounts due under these notes are unsecured and extend through 2009. They are
payable in either monthly or quarterly payments.

On October 31, 1996, Merkert entered into an $8,500 secured revolving line
of credit agreement with a bank. The revolving line of credit bears interest
at the bank's base rate (8.5% at December 31, 1997). On December 23, 1997, the
revolving line of credit agreement was amended to extend the term of the
agreement through February 1, 1999. Amounts outstanding under the revolving
line of credit are secured by eligible accounts receivables. The agreement
contains restrictive covenants customary in this type of financing
arrangement. As of June 30, 1998, Merkert was not in compliance with certain
of these covenants and is in default under the line of credit agreement.

On September 5, 1996, a bank mortgage secured by a building was refinanced
and Merkert entered into a new loan agreement with a bank. The agreement
provided for a $4,335 mortgage loan and amended the existing term loan to
increase the availability under the loan to $2,765. Proceeds from these
borrowings were used to refinance the old bank mortgage note, existing
commercial promissory note, and to fund construction of Merkert's new office
space. The mortgage loan required monthly interest payments only, beginning
October 5, 1996 through July 5, 1997. Effective July 5, 1997, both principal
and interest are due monthly. The mortgage loan matures September 5, 2006, at
which time a balloon payment of the remaining balance would have been due. The
interest rates will float at the bank's base rate, or may be fixed at rates
tied to the London Interbank Offered Rate or U.S. Treasury Rates, at Merkert's
option. The term loan required monthly principal payments of $50, plus
interest and matures September 2, 2001.

The September 5, 1996 loan agreement and the revolving line of credit
agreement contain restrictive covenants customary in these types of financing
arrangements, including limitations on obtaining additional

F-29
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

indebtedness and certain financial covenants including a maximum leverage
ratio and minimum tangible net worth requirements. During 1997, Merkert was in
default with respect to the leverage ratios and the minimum tangible net worth
covenant. On December 23, 1997, Merkert obtained a waiver of these defaults.

On February 13, 1998, Merkert entered into a $9,500 secured mortgage
agreement, effective April 1, 1998, with a real estate lender which replaced
their existing mortgage and term loans. The mortgage note bears interest at
8.56%. The loan requires monthly payments of $82, beginning April 1, 1998 and
matures March 1, 2018.

In September 1995, Merkert repurchased 115,000 shares of common stock for an
aggregate purchase price of $1,909. Merkert paid $581 in cash and delivered an
unsecured promissory note in the amount of $1,328. The note requires three
annual principal payments of $443 and bears interest at 8.75%.

In February 1996, Merkert repurchased 92,000 shares of common stock for an
aggregate purchase price of $1,665. Merkert paid $333 and delivered an
unsecured subordinated promissory note in the amount of $1,332. The note
requires five annual principal payments of $266 and bears interest at 8.25%.

In July 1997, Merkert elected to repurchase 8,000 shares of common stock for
an aggregate purchase price of $160. At December 31, 1997, Merkert had
delivered an unsecured subordinated promissory note in settlement of this
obligation.

In conjunction with the acquisitions discussed in Note 4, elements of the
purchase price were financed by the sellers. These amounts are included in the
following table.

Future principal payments on long-term debt for the years ending December
31, are as follows:

<TABLE>
<S> <C>
1998................................................................. $ 4,778
1999................................................................. 3,049
2000................................................................. 2,726
2001................................................................. 1,899
2002................................................................. 2,084
Thereafter........................................................... 11,520
-------
Total.............................................................. $26,056
=======
</TABLE>

12. SUBSEQUENT EVENTS

On May 20, 1998 and as amended on November , 1998, Merkert entered into a
stock purchase agreement with Merkert American Corporation and the
stockholders of Merkert. Pursuant to this stock purchase agreement Merkert
American Corporation will purchase all of the outstanding shares of common and
convertible redeemable preferred stock of Merkert for approximately $48.5
million in cash and stock of Merkert American Corporation. The consideration
shall be reduced by the amount payable by Merkert as a result of the current
examination of Merkert's federal tax filings for 1992, 1993 and 1994 and state
tax filings for 1994. The consummation of the purchase is subject to a number
of conditions, including the successful completion of an initial public
offering of the common stock of Merkert American Corporation. In addition,
Merkert has agreed to settle the employment contracts of two executives upon
the consummation of the Purchase Agreement and will record a compensation
charge of $1,500 at that time. There can be no assurances that the stock
purchase agreement will be consummated.

F-30
<PAGE>

MERKERT ENTERPRISES, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

On May 22, 1998, Merkert entered into agreements with certain former
stockholders of businesses previously acquired by Merkert. These agreements
provide Merkert with an option to settle, for a predetermined cash payment,
the outstanding obligation due from Merkert to the respective former
stockholder. The cash payouts per these options approximate the amounts
recorded as liabilities in the accompanying consolidated financial statements.
These options expire December 31, 1998. If and when the option is exercised,
any differences between the option amount and the carrying amount in the
accompanying financial statements will be recorded as an adjustment to
purchase price.

On May 18, 1998, Merkert entered into a settlement with the Internal Revenue
Service ("IRS") which resolved matters raised by the IRS in connection with
Merkert's tax filings for 1992, 1993 and 1994. In connection with the
settlement, Merkert will pay approximately $15.3 million, in aggregate, to
both the IRS and the applicable state tax authorities. The amount of the
settlement did not differ materially from recorded reserves. Pursuant to the
stock purchase agreement among Monroe, Inc., Merkert and the stockholders of
Merkert, the former stockholders of Merkert will use a portion of the cash
proceeds received to pay the tax settlement.

In May, 1998 Merkert became subject to an audit with respect to its federal
income tax returns for its fiscal years 1995, 1996, and 1997. Merkert has
established reserves in various years which it believes will be adequate to
cover any potential liability, however the ultimate outcome of this matter is
uncertain.

F-31
<PAGE>

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Rogers-American Company, Inc. and Subsidiary:

We have audited the accompanying consolidated balance sheets of Rogers-
American Company, Inc. ("Rogers") and Subsidiary as of December 31, 1996 and
1997, and the related consolidated statements of operations, stockholders'
equity and cash flows for each of the three years in the period ended December
31, 1997. These financial statements are the responsibility of Rogers'
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Rogers and
Subsidiary as of December 31, 1996 and 1997, and the consolidated results of
their operations and their cash flows for each of the three years in the
period ended December 31, 1997, in conformity with generally accepted
accounting principles.

Arthur Andersen LLP

Boston, Massachusetts
May 22, 1998

F-32
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
DECEMBER 31,
---------------- JUNE 30,
1996 1997 1998
------- ------- -----------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash........................................... $ 730 $ 556 $ 199
Restricted cash................................ 220 505 472
Accounts receivable, less allowance for
doubtful accounts of $484, $799 and $799 in
1996, 1997 and 1998, respectively............. 6,413 9,072 10,457
Prepaid expenses and advances.................. 292 218 455
Income taxes receivable........................ 512 -- --
Deferred tax asset............................. 546 639 639
------- ------- -------
Total current assets......................... 8,713 10,990 12,222
------- ------- -------
Property, plant and equipment, net............... 5,953 5,931 5,673
------- ------- -------
Intangibles, net of amortization................. 20,519 18,671 17,780
------- ------- -------
Other assets:
Cash value of life insurance, net.............. 2,449 3,239 3,359
Deferred tax asset............................. 117 149 149
Other noncurrent assets........................ 10 19 19
------- ------- -------
Total other assets........................... 2,576 3,407 3,527
------- ------- -------
Total assets................................. $37,761 $38,999 $39,202
======= ======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt........... $ 6,344 $ 1,949 $11,804
Accounts payable............................... 3,087 2,034 1,930
Accrued expenses............................... 3,971 3,880 3,545
------- ------- -------
Total current liabilities.................... 13,402 7,863 17,279
------- ------- -------
Long-term debt, less current maturities.......... 24,849 30,830 21,167
------- ------- -------
Other noncurrent liabilities..................... 316 479 479
------- ------- -------
Commitments and contingencies
Stockholders' equity:
Common stock, $1.00 par value--
Authorized--100,000 shares
Issued--955 shares............................ 1 1 1
Additional paid-in capital..................... 149 37 37
Retained earnings (accumulated deficit)........ (956) (211) 239
------- ------- -------
Total stockholders' equity (deficit)......... (806) (173) 277
------- ------- -------
Total liabilities and stockholders' equity... $37,761 $38,999 $39,202
======= ======= =======
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-33
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEAR ENDED DECEMBER 31, JUNE 30,
------------------------- ------------------
1995 1996 1997 1997 1998
------- ------- ------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenues:
Commissions.................. $47,496 $63,311 $82,985 $ 41,053 $ 41,643
------- ------- ------- -------- --------
Operating expenses:
Selling expenses............. 35,817 50,614 63,361 32,403 31,785
General and administrative... 7,457 10,944 13,023 6,593 6,622
Depreciation and
amortization................ 1,073 1,646 2,516 1,408 1,153
------- ------- ------- -------- --------
Operating income........... 3,149 107 4,085 649 2,083
Interest expense............... (1,176) (1,656) (2,536) (1,387) (1,294)
Other income (expense)......... -- -- -- -- 120
------- ------- ------- -------- --------
Income (loss) before provision
for income taxes.............. 1,973 (1,549) 1,549 (738) 909
Income tax provision
(benefit)..................... 939 (460) 804 (198) 459
------- ------- ------- -------- --------
Net income (loss).......... $ 1,034 $(1,089) $ 745 $ (540) $ 450
======= ======= ======= ======== ========
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-34
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
COMMON STOCK,
$1.00 PAR VALUE ADDITIONAL
------------------ PAID-IN RETAINED
SHARES AMOUNT CAPITAL EARNINGS TOTAL
-------- ------- ---------- -------- -------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1994...... 1,120 $ 1 $ 258 $ (901) $ (642)
Net income.................... -- -- -- 1,034 1,034
Issuance of 40 shares at
$1,151.85 per share.......... 40 -- 46 -- 46
Redemption of 69 shares at
$1,151.85 per share.......... (69) -- (79) -- (79)
-------- ------ ----- ------- -------
Balance, December 31, 1995...... 1,091 1 225 133 359
Net loss...................... -- -- -- (1,089) (1,089)
Redemption of 59 shares at
$1,292.16 per share.......... (59) -- (76) -- (76)
-------- ------ ----- ------- -------
Balance, December 31, 1996...... 1,032 1 149 (956) (806)
Net income.................... -- -- -- 745 745
Redemption of 76.4 shares at
$1,470.80 per share.......... (77) -- (112) -- (112)
-------- ------ ----- ------- -------
Balance, December 31, 1997...... 955 1 37 (211) (173)
Net income (unaudited)........ -- -- -- 450 450
-------- ------ ----- ------- -------
Balance, June 30, 1998 (unau-
dited)......................... 955 $ 1 $ 37 $ 239 $ 277
======== ====== ===== ======= =======
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-35
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS
YEAR ENDED DECEMBER 31, ENDED JUNE 30,
--------------------------- ----------------
1995 1996 1997 1997 1998
-------- -------- ------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Cash flows from operating
activities:
Net income (loss)............. $ 1,034 $ (1,089) $ 745 $ (540) $ 450
Adjustments to reconcile net
income (loss) to net cash
provided by (used in)
operating activities--
Depreciation and
amortization............... 1,073 1,646 2,516 985 1,153
Loss on disposal of fixed
assets..................... 85 -- -- -- --
Deferred income taxes....... 72 (500) (126) -- --
Changes in assets and
liabilities exclusive of
acquisitions (increase)
decrease in--
Restricted cash............. 218 (20) (285) -- 33
Accounts receivable, net.... (1,106) (1,707) (2,659) (2,393) (1,385)
Income taxes receivable..... -- (512) 512 512 --
Prepaid expenses and
advances................... 414 (77) 74 (49) (41)
Accounts payable............ 484 1,588 (1,053) (774) (104)
Accrued expenses............ 2,212 129 (91) (754) (335)
Other liabilities........... 891 711 (572) (786) 453
Other assets................ (39) 29 (9) (9) --
-------- -------- ------- ------- -------
Net cash provided by (used
in) operating
activities............... 5,338 198 (948) (3,875) 29
-------- -------- ------- ------- -------
Cash flows from investing activ-
ities:
Additions to property, plant
and equipment................ (387) (1,045) (453) (301) 4
Acquisition of businesses, net
of cash acquired............. (11,594) (11,231) (192) 95 (1)
Increase in cash surrender
value, net of increase in
policy loans................. (478) (487) (789) -- (120)
-------- -------- ------- ------- -------
Net cash provided by (used
in) investing
activities............... (12,459) (12,763) (1,434) (207) (125)
-------- -------- ------- ------- -------
Cash flows from financing activ-
ities:
Borrowings on revolving line
of credit.................... -- 3,024 8,370 4,149 9,402
Principal payments on line of
credit....................... (660) -- (3,824) -- (8,370)
Issuance of long-term debt.... 7,916 10,157 -- -- --
Repayment of long-term debt... -- -- (2,226) (388) (1,294)
Issuance of Common Stock...... 46 -- -- -- --
Redemption of common stock.... (79) (76) (112) -- --
-------- -------- ------- ------- -------
Net cash provided by
financing activities..... 7,223 13,105 2,208 3,761 (261)
-------- -------- ------- ------- -------
Net increase (decrease) in
unrestricted cash........ 102 540 (174) (321) (357)
-------- -------- ------- ------- -------
Unrestricted cash:
Beginning of year............. 88 190 730 730 556
-------- -------- ------- ------- -------
End of year................... $ 190 $ 730 $ 556 $ 409 $ 199
-------- -------- ------- ------- -------
Supplemental disclosures of cash
flow information:
Cash payments for--
Interest.................... $ 1,172 $ 1,635 $ 2,486 $ 181 $ 224
-------- -------- ------- ------- -------
Income taxes................ $ 488 $ 722 $ 180 $ 10 $ 99
-------- -------- ------- ------- -------
Noncash flow information:
Purchase price financed by
seller....................... $ 5,519 $ 10,626 $ 48 $ -- $ --
-------- -------- ------- ------- -------
Liabilities assumed........... $ 682 $ 1,227 $ -- $ -- $ --
-------- -------- ------- ------- -------
</TABLE>

F-36
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDES CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

1. NATURE OF BUSINESS

Rogers-American Company, Inc. ("Rogers") is a broker of food and various
food-related products. Rogers provides sales, marketing and merchandising
services to manufacturers ("Manufacturers") of consumer goods and serves as an
intermediary between the Manufacturers and retailers and wholesalers of the
consumer goods. Rogers primarily operates throughout the southeast and mid-
Atlantic regions of the United States.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A summary of Rogers' significant accounting policies follows:

Principles of Consolidation

The consolidated financial statements include the accounts of Rogers and its
wholly owned subsidiary Rogers-American Company of Florida, Inc. All
intercompany accounts and transactions have been eliminated in consolidation.

Unaudited Interim Financial Information

The financial statements as of June 30, 1998 and for the six months ended
June 30, 1997 and 1998 are unaudited. Rogers believes these financial
statements include all adjustments, consisting of normal recurring
adjustments, that Rogers considers necessary for a fair presentation of the
financial position and of the results of operations for the respective
periods. It should also be noted that the results for the interim periods are
not necessarily indicative of the results expected for any other interim
period or the full year.

Use of Estimates

Revenue Recognition

Commissions are earned and recognized upon shipment by the Manufacturers to
the retailer or wholesaler.

Fair Value of Financial Instruments

Effective December 31, 1995, Rogers adopted Statement of Financial
Accounting Standards (SFAS) No. 107, Disclosures About Fair Value of Financial
Instruments. SFAS No. 107 requires that Rogers disclose estimated fair values
for certain of its financial instruments. Rogers' financial instruments
consist of cash and cash equivalents, accounts and notes receivable, notes
payable, accounts payable and long-term debt. Each of these instruments' fair
value approximates carrying value at December 31, 1995, 1996 and 1997.

Concentration of Credit Risk

Financial instruments that potentially subject Rogers to concentrations of
credit risk consist principally of trade receivables. Rogers' trade
receivables result from commission sales. Rogers maintains reserves for
potential credit losses and such losses have been immaterial.

F-37
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

Property and Equipment

Property and equipment are stated at cost. Depreciation is computed using
the straight-line method based upon the following estimated useful lives of
the assets:

<TABLE>
<CAPTION>
ESTIMATED
ASSET CLASSIFICATION USEFUL LIVES
-------------------- ------------
<S> <C>
Building........................................................ 40 years
Leasehold improvements.......................................... 20 years
Furniture and office equipment.................................. 5-7 years
Motor vehicles.................................................. 3-5 years
</TABLE>

Intangibles

Intangibles for the years ended December 31, 1996 and 1997 consist of the
following:

<TABLE>
<CAPTION>
1996 1997
------- -------
<S> <C> <C>
Goodwill................................................... $17,283 $17,460
Noncompete agreements...................................... 6,589 6,604
------- -------
Accumulated amortization................................... (3,353) (5,393)
------- -------
$20,519 $18,671
======= =======
</TABLE>

Goodwill, the excess of the acquired business purchase price over the fair
value of the acquired assets, is amortized on a straight-line basis over its
estimated useful life which ranges from 5 to 20 years. Noncompete agreements
are amortized on a straight-line basis over the life of the respective
agreement. Amortization expense was $831, $1,285 and $2,040 for the years
ended December 31, 1995, 1996 and 1997, respectively.

Cash Surrender Value of Life Insurance

Included within other noncurrent assets is the cash surrender value of life
insurance, net of policy loans. Rogers maintains these life insurance policies
with a face amount of $32,266 on certain officers and key employees. The cash
surrender value of the policies amounted to $3,727 and $4,305, against which
Rogers has loans of $1,278 and $1,066 on December 31, 1996 and December 31,
1997, respectively.

Income Taxes

Rogers provides for income taxes in accordance with SFAS No. 109, Accounting
for Income Taxes. SFAS No. 109 recognizes tax assets and liabilities for the
cumulative effect of all temporary differences between the financial statement
carrying amounts and the tax basis of assets and liabilities and are measured
using the enacted tax rates expected to be in effect when these differences
are expected to reverse.

Impairment of Long-Lived Assets

Rogers evaluates the carrying value of its long-lived assets in accordance
with SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and
Long-Lived Assets To Be Disposed Of. Accordingly, Rogers evaluates the
carrying value of its long-lived assets, including equipment and goodwill,
whenever events or changes in circumstances indicate that the carrying value
may not be recoverable. Under SFAS No. 121, an assessment is made to determine
whether the sum of the expected future undiscounted cash flows from

F-38
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

the use of the assets and eventual disposition is less than the carrying
value. If the sum of the expected undiscounted cash flows is less than the
carrying value, an impairment loss is recognized by measuring the excess of
carrying value over fair value (generally estimated by projected future
discounted cash flows for the applicable operation or independent appraisal).
At December 31, 1996 and 1997, management believes no such impairment of
assets was indicated.

Accrued Expenses

Accrued expenses for the years ended December 31, 1996 and 1997 consist of
the following:

<TABLE>
<CAPTION>
1996 1997
------ ------
<S> <C> <C>
Payroll and employee benefits................................. $1,361 $ 535
Promotional funds............................................. 220 505
Income taxes.................................................. 996 1,270
Health insurance.............................................. 351 476
Interest...................................................... 49 99
Other......................................................... 994 995
------ ------
$3,971 $3,880
====== ======
</TABLE>

3. ACQUISITIONS

Rogers completed acquisitions of several food brokerage businesses during
1995, 1996 and 1997.

The acquisitions are accounted for using the purchase method of accounting;
accordingly, the results of operations are included in the accompanying
consolidated financial statements from their respective dates of acquisition.
The purchase price has been allocated to assets acquired and liabilities
assumed based upon their estimated fair values at the date of acquisition. A
portion of the purchase price in certain acquisitions is payable contingent
upon achieving defined performance criteria. Rogers' policy is to estimate the
net present value of the expected payments and record that amount as part of
the purchase price. Rogers records any ultimate changes to the estimate as an
adjustment to goodwill. Purchase price in excess of identified tangible and
intangible assets is recorded as goodwill and amortized on a straight-line
basis over periods ranging from 5 to 20 years. The following is a summary of
the acquisitions which were consummated in 1995, 1996 and 1997.

<TABLE>
<CAPTION>
PURCHASE PRICE NET
------------------- TANGIBLE
FINANCED ASSETS
ACQUISITION DATE CASH PAID BY SELLER ACQUIRED GOODWILL OTHER INTANGIBLES
----------- ------------- --------- --------- -------- -------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Clarke & Wittekind March 1995 $ -- $(1,403) $282 $ 897 $ 224
A.A. Green October 1995 -- (1,374) -- 1,099 275
Dopson-Hicks October 1995 (206) (3,142) 606 2,194 548
G.B.S. October 1996 -- (982) 288 555 139
Fitzwater November 1996 (800) (5,924) 800 4,739 1,185
Sales Support Inc. November 1996 -- (997) -- -- 997
Tinney & Associates November 1996 -- (1,377) 218 927 232
Brown & Stagner November 1996 -- (1,905) 97 1,446 362
Others Various -- (1,001) 36 486 479
</TABLE>

F-39
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

Had each of these acquisitions been consummated on January 1, 1996, the
unaudited pro forma revenues and net income (loss) for Rogers would have been
$81,328 and $(1,033), respectively, for the year ended December 31, 1996, and
$83,100 and $(771), respectively, for the year ended December 31, 1997.

4. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are comprised of the following at December 31:

<TABLE>
<CAPTION>
1996 1997
------ ------
<S> <C> <C>
Land.......................................................... $ 500 $ 500
Buildings..................................................... 3,500 3,500
Furniture and equipment....................................... 3,117 3,476
Motor vehicles................................................ 79 79
Leasehold improvements........................................ 694 789
------ ------
7,890 8,344
Less--Accumulated depreciation................................ 1,937 2,413
------ ------
$5,953 $5,931
====== ======
</TABLE>

Depreciation expense for the years ended December 31, 1995, 1996 and 1997
was $242, $361 and $476, respectively.

5. EMPLOYEE BENEFIT PLANS

Rogers sponsors the Rogers-American Company, Inc. 401(k) Profit Sharing Plan
(the "401(k) Plan") under the provisions of Section 401(k) of the Internal
Revenue Code. The 401(k) Plan covers all employees, except flexible part-time
employees, who are at least 21 years of age with at least six months of
employment service. These eligible employees can make voluntary contributions
to the 401(k) Plan.

Under the provisions of the 401(k) Plan, Rogers currently matches 25% of an
eligible employee's contribution up to certain limits determined by Rogers
(currently 6%) of the employee's salary. On an annual basis, Rogers may make a
discretionary contribution into the profit sharing component of the 401(k)
Plan. For the years ended December 31, 1995, 1996 and 1997, Rogers expensed
approximately $738, $615 and $403, respectively, under the terms of the 401(k)
Plan.

6. CONTINGENCIES

Rogers is subject to various legal proceedings that arise in the ordinary
course of business. Based on the opinion of Rogers' external legal counsel,
management believes the outcome of such legal proceedings will not have a
material adverse impact on Rogers' consolidated financial position or results
of operations.

7. COMMITMENTS

Commitments

Certain of Rogers' Manufacturers provide Rogers with funds to be used solely
for marketing, advertising and other promotional activities. At December 31,
1997, Rogers had cash of $505 which use was restricted to payment of
promotional funds on behalf of its Manufacturers. The offsetting liability was
recorded as promotional funds in the balance sheet at December 31, 1997. At
December 31, 1996, Rogers had $220 of restricted cash and promotional funds
liability on the balance sheet.

F-40
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

Legal Proceedings

Rogers has received written notice from the seller of a food brokerage
business acquired by Rogers alleging breach of certain covenants contained in
an agreement with such seller claiming such breaches have caused the
acceleration of certain obligations of Rogers to the seller. The obligations
to the seller are secured by a lien on the assets acquired by Rogers and a
pledge of the capital stock of Rogers' Florida subsidiary.

Rogers believes that this matter, if determined adversely to Rogers, would
not have a material adverse effect on the financial condition or results of
operations of Rogers.

Several key employees of Rogers have employment agreements that contain
incentive bonus awards. The awards are discretionary in nature and are in
effect for the period from 1999 to 2007. As of December 31, 1997, Rogers has
not accrued a liability for these awards and no amount is due for the year
ended December 31, 1997. Rogers may terminate any of the employment agreements
for just cause without incurring any liability.

Rogers has various supplemental pension agreements with individual
employees. These agreements provide benefits to those individuals at age 65 or
upon the termination of their employment with Rogers, whichever is later. The
estimated liability under the agreement is being accrued over the expected
remaining years of employment on a present value basis. At December 31, 1996
and 1997, Rogers had accrued approximately $316 and $479, respectively. The
vested benefits are payable in 120 equal monthly installments subsequent to
the employee's separation or retirement from Rogers. There were no required
expenses in 1995 and 1996 and $163 was expensed in 1997 under these
agreements.

Rogers has an agreement with its stockholders whereas in the event of death,
disability or retirement of the stockholder, Rogers shall purchase all of the
stock owned by each respective stockholder or his or her estate, payable over
a 10-year period. This agreement is partially funded by insurance.

Rogers has an agreement with a stockholder for the redemption of 584 shares
of common stock owned by the stockholder evenly over a 10-year period from
January 1, 1993 through January 1, 2002. Rogers shall redeem the shares at the
book value per share on the last day of the preceding fiscal year applicable
to the option exercise date or October 31 1992, whichever is higher.

Leases

Rogers leases certain office and warehouse facilities and automobiles under
operating leases expiring on various dates through 2003.

Rental costs, including real estate taxes, amounted to approximately $3,871,
$5,773 and $7,985 in 1995, 1996 and 1997, respectively.

The following is a schedule of future minimum rental payments, exclusive of
real estate taxes, required under operating leases that have initial or
remaining noncancelable lease terms in excess of one year as of December 31,
1997:

<TABLE>
<CAPTION>
RENT
PAYMENTS
--------
<S> <C>
Year ending December 31,
1998............................................................... $3,258
1999............................................................... 2,688
2000............................................................... 1,884
2001............................................................... 1,201
2002............................................................... 91
Thereafter......................................................... 17
------
Total............................................................. $9,139
======
</TABLE>

F-41
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

8. RELATED PARTY TRANSACTIONS

Rogers provides office space to an affiliated merchandising entity which
began operations in 1997. Rogers owns 49% of the outstanding voting common
stock of this entity. In addition, Rogers has guaranteed a $500 line of credit
with a bank to this affiliate. At December 31, 1997, approximately $75 was
outstanding under the line of credit. Sales and net income of the affiliate
for 1997 were $922 and $(1). Total assets at December 31, 1997 were $218.
Rogers had no trade receivables outstanding at December 31, 1997 from this
affiliate. During 1997, Rogers had no sales to this affiliate.

Rogers is a co-guarantor on a $750 line of credit with a bank for another
affiliated entity. Certain of Rogers' shareholders, as a group, own 49% of the
voting common stock of this entity. At December 31, 1997, approximately $644
was outstanding under the line of credit. During 1996 and 1997, Rogers
recorded commission revenues of approximately $230 and $183 from this
affiliate. Trade receivables at December 31, 1996 and 1997 were $48 and $56,
respectively.

9. INCOME TAXES

The (benefit) provision for income taxes for the years ended December 31
1995, 1996 and 1997 is as follows:

<TABLE>
<CAPTION>
1995 1996 1997
---- ----- ----
<S> <C> <C> <C>
Federal--
Current................................................. $713 $ 30 $698
Deferred................................................ (8) (375) (95)
---- ----- ----
705 (345) 603
---- ----- ----
State--
Current ................................................ 237 10 232
Deferred ............................................... (3) (125) (31)
---- ----- ----
234 (115) 201
---- ----- ----
$939 $(460) $804
==== ===== ====
</TABLE>

<TABLE>
<CAPTION>
YEAR ENDED
-----------------
1995 1996 1997
---- ----- ----
<S> <C> <C> <C>
Computed expected tax provision (benefit)................. $671 $(527) $527
State income taxes, net of federal benefit................ 115 (74) 87
Permanent items........................................... 178 171 140
Other..................................................... (25) (30) 50
---- ----- ----
$939 $(460) $804
==== ===== ====
</TABLE>

F-42
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

The tax effect of temporary differences which give rise to deferred income
tax assets (liabilities) are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------
1996 1997
------ ------
<S> <C> <C>
Assets--
Net operating loss carryforwards........................... $ 362 $ --
Tax credit carryforwards................................... 24 --
Receivable reserves........................................ 189 312
Other...................................................... 170 585
------ ------
Total assets............................................. 745 897
------ ------
Valuation allowance........................................ -- --
------ ------
Total assets, net of valuation allowance................. 745 897
------ ------
Liabilities--
Property basis differences................................. (35) (53)
Other...................................................... (47) (56)
------ ------
Total liabilities........................................ (82) (109)
------ ------
Net assets............................................... $ 663 $ 788
====== ======
</TABLE>

10. LONG-TERM DEBT

As of December 31, long-term debt consists of:

<TABLE>
<CAPTION>
1996 1997
------- -------
<S> <C> <C>
Revolving line of credit................................... $ 3,824 $ 8,370
Mortgage loan.............................................. 3,871 3,794
Acquisition Agreement--Clarke & Wittekind.................. 1,224 1,147
Acquisition Agreement--A.A. Green.......................... 1,050 930
Acquisition Agreement--Dopson-Hicks........................ 2,659 2,396
Acquisition Agreement--G.B.S............................... 972 823
Acquisition Agreement--Fitzwater........................... 6,812 5,193
Acquisition Agreement--Sales Support Inc................... 997 1,002
Acquisition Agreement--Tinney & Associates................. 1,098 990
Acquisition Agreement--Brown & Stagner..................... 1,790 1,806
Other acquisitions......................................... 6,800 6,268
Bank--Notes payable........................................ 96 60
------- -------
31,193 32,779
Less--Current maturities................................... (6,344) (1,949)
------- -------
$24,849 $30,830
======= =======
</TABLE>

On November 8, 1996, Rogers entered into a $10,000 secured revolving credit
facility with a bank. The revolving line of credit bears interest at a
variable rate based on the lesser of the bank's prime rate or LIBOR plus 2.7%,
(8.67% at December 31, 1997). Interest is payable monthly. In April 1998, the
revolving line-of-credit agreement was amended to extend the term of the
agreement through January 31, 1999. Rogers' borrowings under the agreement are
limited to certain percentages of eligible receivables and cash surrender
value of life insurance. The line is collateralized by commission receivables,
cash value of life insurance, intangible assets

F-43
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

and proceeds thereof. At December 31, 1997, Rogers had available to it, unused
borrowing capacity of $1,630 under the line of credit. The agreement contains
certain restrictive covenants. At December 31, 1997, Rogers was in compliance
with these covenants.

A mortgage note was entered into in February 1991 and refinanced in February
1995. The note is secured by land, building and fixtures. The note bears
interest at 8.5% with monthly payments of $34 including interest through
December 1999 and a balloon payment of $3,646 on January 2000.

The amounts due under the acquisition agreements represent the total
estimated payments to be made pursuant to these agreements. The total
estimated payments have been discounted using a rate of approximately 8%. The
amounts due under these notes payable are unsecured and extend through 2011.
These amounts are payable in either monthly or quarterly installments.

Rogers has the following debt resulting from business acquisitions:

Bay Brokerage--Unsecured notes payables bearing interest at 10% per annum
with monthly payments of $4 through June 2007 and various other assumed
liabilities with various payments through September 2007.

T&M--Unsecured notes payable bearing interest at 8% per annum, with monthly
payments of $2 through September 1999 and $6 through September 2004.

G.B.S.--Unsecured note payable bearing interest at 7% per annum with monthly
payments of $1 starting October 1998 through January 2000. Unsecured note
payable bearing interest at 7% per annum with monthly payments of $8 starting
October 1997 through September 1998, $7 through September 2005, $5 through
August 2006, and one final payment of $7 due on September 2006. Unsecured note
payable bearing interest at 7% per annum with monthly payments of $1 starting
October 1999 through September 2009.

Tinney & Associates--Unsecured note payable with imputed interest at 10% per
annum, with monthly payments of $6 through July 2000.

Brown & Stagner--Unsecured note payable with imputed interest of 8% per
annum and monthly payments of $3 through July 2000.

Clarke & Wittekind--Unsecured note payable with imputed interest of 7.8% per
annum and monthly payments of $1 through March 2005.

Dopson-Hicks--Note payable secured by certain tangible assets and stock of
the subsidiary bearing interest at 8% per annum and monthly payments of $13
through October 2000, $33 through October 2005 and $21 through October 2010.

Rogers has unsecured notes payable to various banks bearing interest at 10%
and 8.5% with monthly payments of $3 and $1 through June 1999 and through
February 2000, respectively.

F-44
<PAGE>

ROGERS-AMERICAN COMPANY, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(INCLUDING CERTAIN DATA APPLICABLE TO UNAUDITED PERIODS)

Notes Payable

Future principal payments on long-term debt for the years ending December
31, are as follows:

<TABLE>
<S> <C>
1998............................................................. $ 1,949
1999............................................................. 10,593
2000............................................................. 5,688
2001............................................................. 2,207
2002............................................................. 2,144
Thereafter....................................................... 10,198
-------
Total.......................................................... $32,779
=======
</TABLE>

11. SUBSEQUENT EVENTS

On May 22, 1998 and as amended on November 3, 1998, Rogers entered into a
stock purchase agreement with Merkert American Corporation and the
stockholders of Rogers (the "Purchase Agreement"). Pursuant to the Purchase
Agreement, Merkert American Corporation will purchase all of the outstanding
shares of common stock of Rogers for approximately $25.6 million in cash. The
consummation of the purchase is subject to a number of conditions, including
the successful completion of an initial public offering of the common stock of
Merkert American Corporation. There can be no assurance that the Purchase
Agreement will be consummated.

In connection with the consummation of the Purchase Agreement, Rogers
intends to sell its corporate headquarters and distribute the net cash
proceeds to certain stockholders. In addition, Rogers will assign the life
insurance policies on key executives to certain stockholders. Also, the
principal stockholders of Rogers have agreed to transfer a portion of their
shares of common stock to certain minority stockholders to compensate those
employees for valuable prior services. Rogers will record a compensation
charge for each of these events in their financial statements at that date.

On May 22, 1998, Rogers entered into agreements with certain sellers of
businesses acquired by Rogers. These agreements provide Rogers with the option
to settle, for a predetermined cash payment, any outstanding obligation due
from Rogers to the respective seller as a result of the acquisition. The cash
payouts per these options approximate the amounts recorded as liabilities in
the accompanying consolidated financial statements. These options expire on
September 30, 1998.

F-45
<PAGE>

INDEPENDENT AUDITORS' REPORT

The Board of Directors Fitzwater Inc.:

We have audited the accompanying balance sheet of Fitzwater Inc. as of
December 31, 1995, and the related statements of income, stockholders' equity,
and cash flows for the year then ended. 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 audit 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 audit provides a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Fitzwater Inc. as of
December 31, 1995, and the results of its operations and its cash flows for
the year then ended in conformity with generally accepted accounting
principles.

Hege Kramer Connell Murphy & Goldkamp,
P.C.

Philadelphia, Pennsylvania
March 14, 1996

F-46
<PAGE>

FITZWATER INC.

BALANCE SHEET
DECEMBER 31, 1995

<TABLE>
<S> <C>
ASSETS
Current assets:
Cash and cash equivalents....................................... $ 817,429
Accounts receivable............................................. 1,851,471
Advances to employees........................................... 25,905
Prepaid expenses................................................ 19,460
-----------
Total current assets.......................................... 2,714,265
-----------
Property and equipment:
Land and land improvements...................................... 176,679
Buildings....................................................... 1,353,540
Furniture and office equipment.................................. 1,789,564
Equipment under lease........................................... 89,331
-----------
3,409,114
Less accumulated depreciation................................... 1,536,228
-----------
1,872,886
-----------
Deposits.......................................................... 69,148
Note receivable................................................... 50,000
Goodwill, less accumulated amortization of $420,636............... 46,737
Cash surrender value of officers' life insurance.................. 893,001
-----------
$ 5,646,037
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt............................ $ 314,181
Promotional advances............................................ 693,024
Accounts payable................................................ 115,702
Due to affiliate................................................ 23,239
Accrued liabilities:
ESOP contribution............................................. 700,000
Payroll and payroll taxes, withheld and accrued............... 181,179
Cash and deferred plan contribution........................... 80,065
Health insurance.............................................. 86,083
Other......................................................... 113,857
-----------
Total current liabilities................................... 2,307,330
-----------
Deferred taxes.................................................... 66,562
Long-term debt, less current maturities........................... 2,030,186
Stockholders' equity:
Common stock--par value $.01 per share; authorized 200,000
shares, issued 189,800......................................... 1,898
Additional paid-in capital...................................... 984,652
Unearned ESOP compensation...................................... (3,292,800)
Retained earnings............................................... 3,548,209
-----------
Total stockholders' equity.................................. 1,241,959
-----------
$ 5,646,037
===========
</TABLE>

See accompanying notes to financial statements.

F-47
<PAGE>

FITZWATER INC.

STATEMENTS OF INCOME

<TABLE>
<CAPTION>
TEN MONTHS ENDED
YEAR ENDED OCTOBER 31, 1996
DECEMBER 31, 1995 (UNAUDITED)
----------------- ----------------
<S> <C> <C>
Commissions and operating revenues......... $14,690,831 $11,646,636
Operating expenses (including interest of
$27,818 in 1995).......................... 12,809,863 10,952,583
----------- -----------
Operating profit....................... 1,880,968 694,053
----------- -----------
Other income (expense):
Excise tax............................... -- (329,820)
ESOP contribution........................ (700,000) --
Special commissions...................... (62,214) (65,800)
Amortization expense..................... (46,737) (46,737)
Interest income.......................... 87,087 66,739
----------- -----------
(721,864) (375,618)
----------- -----------
Income before income taxes............. 1,159,104 318,435
Income taxes............................... 516,805 296,315
----------- -----------
Net income............................. $ 642,299 $ 22,120
=========== ===========
</TABLE>

See accompanying notes to financial statements.

F-48
<PAGE>

FITZWATER INC.

STATEMENT OF STOCKHOLDERS' EQUITY

YEAR ENDED DECEMBER 31, 1995 AND TEN MONTHS ENDED OCTOBER 31, 1996 (UNAUDITED)

<TABLE>
<CAPTION>
ADDITIONAL UNEARNED
COMMON PAID-IN ESOP RETAINED
STOCK CAPITAL COMPENSATION EARNINGS TOTAL
------ ---------- ------------ ---------- -----------
<S> <C> <C> <C> <C> <C>
Balance at December 31,
1994................... $1,898 $984,652 $ -- $2,905,910 $ 3,892,460
Net income............ -- -- -- 642,299 642,299
Loan to ESOP for
purchase of common
stock................ -- -- (3,292,800) -- (3,292,800)
------ -------- ----------- ---------- -----------
Balance at December 31,
1995................... $1,898 $984,652 $(3,292,800) $3,548,209 $ 1,241,959
Net income
(unaudited).......... -- -- -- 22,120 22,120
------ -------- ----------- ---------- -----------
Balance at October 31,
1996 (unaudited)....... $1,898 $984,652 $(3,292,800) $3,570,329 $ 1,264,079
====== ======== =========== ========== ===========
</TABLE>

See accompanying notes to financial statements.

F-49
<PAGE>

FITZWATER INC.

STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
TEN MONTHS
YEAR ENDED ENDED
DECEMBER 31, 1995 OCTOBER 31, 1996
----------------- ----------------
(UNAUDITED)
<S> <C> <C>
Cash flows from operating activities:
Net income................................. $ 642,299 $ 22,120
----------- -----------
Adjustments to reconcile net income to net
cash provided by operating activities:
Loss on sale of assets.................... 849 7,880
Depreciation and amortization............. 436,198 341,870
(Increase) decrease in assets:
Accounts receivable...................... (219,888) 1,338,336
Advances to employees.................... 16,690 25,905
Prepaid expenses......................... 14,347 (924,511)
Deposits................................. (38,858) 62,270
Cash surrender value of officer's life
insurance............................... (180,816) (158,792)
Increase (decrease) in liabilities:
Promotional advances..................... 345,933 (640,573)
Accounts payable......................... (2,983) (115,702)
Accrued liabilities...................... (131,950) (701,597)
Deferred taxes........................... (3,063) 8,785
----------- -----------
Total adjustments....................... 236,459 (756,129)
----------- -----------
Net cash provided by operating
activities.............................. 878,758 (734,009)
----------- -----------
Cash flows from investing activities:
Purchases of property and equipment........ (284,215) (125,863)
Proceeds from the sale of property and
equipment................................. 2,665 895,610
Proceeds on disposal of life insurance
policies, net of policy loans............. -- 1,051,793
----------- -----------
Net cash used in investing activities.... (281,550) 1,821,540
----------- -----------
Cash flows from financing activities:
Increase in amount due to affiliate........ 24,240 (23,239)
Repayment of debt.......................... (115,260) (1,518,220)
Bank borrowings............................ 2,200,000
Payment on notes receivable................ -- 50,000
Loan to ESOP for purchase of common stock.. (3,292,800) --
----------- -----------
Net cash provided by (used in) financing
activities.............................. (1,183,820) (1,491,459)
----------- -----------
Increase (decrease) in cash and cash
equivalents............................. (586,612) (403,928)
Cash and cash equivalents:
Beginning of year.......................... 1,404,041 817,429
----------- -----------
End of year................................ $ 817,429 $ 413,501
=========== ===========
Supplemental cash flow information:
Cash paid during the year for:
Interest.................................. $ 27,818 $ 137,094
Income taxes.............................. 428,217 1,344,282
</TABLE>

See accompanying notes to financial statements.

F-50
<PAGE>

FITZWATER INC.

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 1995

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Fitzwater Inc. (the "Company") is a food brokerage firm which represents
national food product producers in the states of Delaware, Maryland, New
Jersey, and Pennsylvania. Accounts receivable are comprised primarily of
commissions from the various principals represented by the Company.

Property and Equipment

Property and equipment are carried at cost. Depreciation is computed using
both the straight-line and accelerated methods for accounting and tax purposes
over the following estimated and useful lives: buildings--27 to 39 years,
furniture and office equipment--5 to 10 years. When assets are retired or
otherwise disposed of, the cost and related accumulated depreciation are
removed from the accounts, and any resulting gain or loss is reflected in
income for the period. The cost of maintenance and repairs is charged to
income as incurred, whereas significant renewals and betterments are
capitalized.

Goodwill

Goodwill is being amortized over a ten-year period using the straight-line
method. The amortization expense is $46,737 for 1995 and 1996.

Cash Equivalents

For purposes of the statement of cash flows, the Company considers all
highly liquid debt instruments with maturities of three months or less at the
date of purchase to be cash equivalents.

Concentration of Credit Risk

The Company maintains cash deposits at certain financial institutions in
amounts that exceed federal insured limits of $100,000.

Income Taxes

Statement of Financial Accounting Standards (SFAS) No. 109, Accounting for
Income Taxes was issued by the Financial Accounting Standards Board (FASB) in
February 1992. Under SFAS 109, deferred tax assets and liabilities are based
on provisions of the enacted tax law; the effect of future changes in tax laws
or rates are not anticipated. The item creating the deferred tax liability is
depreciation.

(2) LONG-TERM DEBT

Long-term debt at December 31, 1995 was comprised of the following:

<TABLE>
<S> <C>
Subordinated note payable to former stockholder, payable in
monthly installments of $12,033 including 14% interest.......... $ 144,367
Notes payable to bank, payable in quarterly installments of
$104,200 including 7.65% interest............................... 2,200,000
----------
2,344,367
Less current portion............................................. 314,181
----------
$2,030,186
==========
</TABLE>

F-51
<PAGE>

FITZWATER INC.

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

The proceeds of the notes payable to bank were used to finance the loan to
the ESOP (note 6). The notes payable are secured by property and equipment and
other various assets.

Maturities of long-term debt will be as follows:

<TABLE>
<S> <C>
1996.............................................................. $ 314,181
1997.............................................................. 281,919
1998.............................................................. 291,282
1999.............................................................. 314,212
2000.............................................................. 338,948
Thereafter........................................................ 803,825
----------
$2,344,367
==========
</TABLE>

(3) LINE OF CREDIT

The Company has a line of credit with a bank which provides for borrowings
of up to $600,000, and bears interest at the lender's prime rate. The line of
credit is secured by the Company's assets. There are no outstanding borrowings
at December 31, 1995.

(4) LEASES

Leases of branch sales offices, office space, computer software and
automobiles are accounted for as operating leases. Total rental expense
amounted to $923,285 for 1995.

The following is a schedule of future minimum lease commitments for the
operating leases (with initial terms in excess of one year) as of December 31,
1995:

(5) PROFIT-SHARING PLAN

The Company has a profit sharing/401(k) plan which is the result of the
Company merging its cash and deferred plan into its profit sharing plan to
create one plan effective January 1, 1994. All employees are eligible, and
contributions are voluntary. The Company makes an annual matching contribution
equal to 25% of the amount contributed by the particpant, limited to the first
6% of the amount contributed by the participant. The annual addition to a
participant's account cannot exceed the lesser of $30,000 or 25% of the
employee's total compensation from the employer during the plan year. The
Company's matching contributions were $80,065 for 1995.

(6) EMPLOYEE STOCK OWNERSHIP PLAN

The Company has an Employee Stock Ownership Plan (ESOP) effective as of
January 1, 1995. All of the Company's full-time employees are eligible to
participate in the ESOP. The ESOP borrowed $3,292,800 from Fitzwater, Inc. and
used the proceeds to purchase 58,500 shares of the Company's common stock from
two shareholders who are officers of the Company. Unearned ESOP compensation
(equal to the outstanding balance of the ESOP loan) of $3,292,800 is reflected
as a reduction of stockholder's equity at December 31, 1995. The loan is
secured by the shares of the Company's common stock held by the ESOP. The loan
will be reduced by the Company's future contributions to the ESOP. The Company
accrued a contribution to the ESOP of $700,000 for 1995.

F-52
<PAGE>

FITZWATER INC.

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(7) INCOME TAXES

The provision for income taxes is comprised as follows:

<TABLE>
<CAPTION>
TEN MONTHS ENDED
OCTOBER 31, 1996 1995
---------------- --------
<S> <C> <C>
Currently payable:
Federal......................................... $215,838 $396,202
State........................................... 71,692 123,666
-------- --------
287,530 519,868
Deferred tax (benefit)............................ 8,785 (3,063)
-------- --------
$296,315 $516,805
======== ========
</TABLE>

The change in the deferred tax liability is summarized as follows:

<TABLE>
<S> <C>
Balance, December 31, 1994.......................................... $69,625
Change for the year............................................... (3,063)
-------
Balance, December 31, 1995.......................................... $66,562
=======
</TABLE>

(8) RELATED PARTY TRANSACTIONS

The Company allocated certain operating and administrative expenses to an
affiliate of $74,400 during 1995. These expenses represent expenses actually
incurred by the Company on behalf of the affiliate.

The Company leases an office building for its Western Division in Harrisburg
from a related party. The current lease period began in 1993 and expires
November 14, 1997. Annual lease payments were $160,328 for 1995. Lease
commitments subsequent to 1995 are included in note 4.

(9) COMMITMENTS

In connection with the change in the Company's ownership in 1986, the
Company agreed to compensate the former owner under a noncompete and
consulting agreement at $3,125 per month until December 1996.

(10) STOCKHOLDERS' EQUITY

In 1995, the Company had a 100-for-1 stock split and changed the par value
of the common stock from $1 per share to $.01 per share. This resulted in an
increase in authorized and outstanding shares to 189,800 shares at December
31, 1995.

All shares owned by the stockholders are subject to the terms of a
Stockholder Agreement, dated December 1, 1995, which imposes certain
preconditions and restrictions on any attempted sale, assignment, transfer, or
other disposition of the shares by a stockholder.

(11) DEPRECIATION

Depreciation expense was $389,461 for the year ended December 31, 1995 and
$295,133 for the period ended October 31, 1996.

F-53
<PAGE>

NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY IN-
FORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS IN
CONNECTION WITH THE OFFERING COVERED BY THIS PROSPECTUS. IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHO-
RIZED BY THE COMPANY OR THE UNDERWRITERS. THIS PROSPECTUS DOES NOT CONSTITUTE
AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY, THE COMMON STOCK IN ANY
JURISDICTION WHERE, OR TO ANY PERSON TO WHOM, IT IS UNLAWFUL TO MAKE SUCH OFFER
OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS
NOT BEEN ANY CHANGE IN THE FACTS SET FORTH IN THIS PROSPECTUS OR IN THE AFFAIRS
OF THE COMPANY SINCE THE DATE HEREOF.

---------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Prospectus Summary....................................................... 3
Risk Factors............................................................. 11
The Combination.......................................................... 17
Use of Proceeds.......................................................... 18
Dividend Policy.......................................................... 18
Capitalization........................................................... 19
Dilution................................................................. 20
Selected Financial Data for Merkert and Rogers........................... 21
Management's Discussion and Analysis of Financial Condition and Results
of Operations........................................................... 22
Business................................................................. 34
Management............................................................... 44
Certain Transactions..................................................... 51
Principal Stockholders................................................... 54
Description of Capital Stock............................................. 56
Shares Eligible for Future Sale.......................................... 60
Underwriting............................................................. 62
Legal Matters............................................................ 64
Experts.................................................................. 64
Available Information.................................................... 65
Index to Financial Statements............................................ F-1
</TABLE>

UNTIL , 1998 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL DEALERS EF-
FECTING TRANSACTIONS IN THE COMMON STOCK, WHETHER OR NOT PARTICIPATING IN THIS
DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS DELIVERY
REQUIREMENT 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.

4,400,000 SHARES

[MERKERT AMERICAN CORP. LOGO APPEARS HERE]

COMMON STOCK

-----------

PROSPECTUS

-----------

, 1998

<PAGE>

PART II.
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth the various expenses in connection with the
sale and distribution of the securities being registered, other than the
underwriting discounts and commissions. All amounts shown are estimates except
for the Securities and Exchange Commission registration fee, the NASD filing
fee and the Nasdaq National Market listing fee:

<TABLE>
<CAPTION>
NATURE OF EXPENSE AMOUNT
----------------- ----------
<S> <C>
SEC registration fee............................................. $ 41,050
NASD filing fee.................................................. 15,015
Nasdaq National Market listing fee............................... 78,875
Legal fees and expenses.......................................... 1,400,000
Accounting fees and expenses..................................... 400,000
Blue Sky fees.................................................... 12,000
Printing expenses................................................ 250,000
Transfer agent fee............................................... 2,500
Premium for directors' and officers' insurance................... 130,000
Miscellaneous.................................................... 170,560
----------
Total.......................................................... $2,500,000
==========
</TABLE>

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

In accordance with Section 145 of the Delaware General Corporation Law,
Article VII of the Registrant's Amended and Restated Certificate of
Incorporation (the "Certificate") provides that no director of the Registrant
shall be personally liable to the Registrant or its stockholders for monetary
damages for breach of fiduciary duty as a director, except for liability (i)
for any breach of the director's duty of loyalty to the Registrant or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) in respect of
certain unlawful dividend payments or stock redemptions or repurchases, or
(iv) for any transaction from which the director derived an improper personal
benefit. In addition, the Certificate provides that if the Delaware General
Corporation Law is amended to authorize the further elimination or limitation
of the liability of directors, then the liability of a director of the
Registrant shall be eliminated or limited to the fullest extent permitted by
the Delaware General Corporation Law, as so amended.

Article V of the Registrant's By-laws provides for indemnification by the
Registrant of its directors and officers and certain non-officer employees
under certain circumstances against expenses (including attorneys' fees,
judgments, penalties, fines and amounts paid in settlement) reasonably
incurred in connection with the defense or settlement of any threatened,
pending or completed legal proceeding in which any such person is involved by
reason of the fact that such person is or was an officer or employee of the
Registrant unless it is determined that such person did not act in good faith
and in a manner he or she reasonably believed to be in or not opposed to the
best interests of the Registrant, and, with respect to criminal actions or
proceedings, such person had no reasonable cause to believe his or her conduct
was unlawful.

The Registrant intends to enter into indemnification agreements with each of
its directors reflecting the foregoing provisions of the By-laws and requiring
the advancement of expenses in proceedings involving directors in most
circumstances and also intends to purchase directors' and officers' insurance
to provide additional protections to the directors and officers of the
Registrant in certain circumstances.

Under the Purchase Agreement filed as Exhibit 1.1 hereto, the Underwriters
will agree to indemnify, under certain conditions, the Registrant, its
directors and certain officers and persons who control the Registrant within
the meaning of the Securities Act of 1933, as amended (the "Act"), against
certain liabilities.

II-1
<PAGE>

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

In March 1998, the Registrant issued and sold 1,500 shares of Common Stock
to Monroe & Company II, LLC at a purchase price of $.10 per share. No
underwriters or underwriting discounts or commissions were involved.

In April 1998, the Company issued and sold 300 shares of Common Stock to
Gerald R. Leonard for an aggregate purchase price of $1,500,000. No
underwriters or underwriting discounts or commissions were involved. See
"Certain Transactions."

The Company entered into a stock purchase agreement with the stockholders of
Merkert pursuant to which the Company agreed to issue to such stockholders
shares of Common Stock in the Combination, as described under "The
Combination."

There was no public offering in such transactions, and the Registrant
believes that such transactions were exempt from registration requirements of
the Act, by reason of Section 4(2) thereof.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Exhibits. The following is a complete list of exhibits filed or
incorporated by reference as part of this Registration Statement.

<TABLE>
<C> <S>
1.1+ Form of Purchase Agreement.
3.1+ Form of Amended and Restated Certificate of Incorporation.
3.2+ Form of Amended and Restated By-laws.
4.1+ Specimen certificate for shares of Common Stock, $.01 par value, of the
Registrant.
5.1* Opinion of Goodwin, Procter & Hoar LLP as to the legality of the
securities being offered.
10.1+ Stock Purchase Agreement, dated May 20, 1998, among the Registrant,
Merkert Enterprises, Inc. and the stockholders of Merkert Enterprises,
Inc.
10.2+ Stock Purchase Agreement, dated May 22, 1998, among the Registrant,
Rogers-American Company, Inc. and the stockholders of Rogers-American
Company, Inc.
10.3+ Form of Employment and Non-Competition Agreement to be entered into by
the Registrant and Gerald R. Leonard, Sidney D. Rogers, Jr. and Glenn
F. Gillam.
10.4+ Form of Employment and Non-Competition Agreement to be entered into by
the Registrant and Douglas H. Holstein and Marty D. Carter.
10.5+ Form of Tax Escrow Agreement to be entered into by the Registrant and
Robert Q. Crane, as Stockholders' Representative.
10.6+ Form of Indemnification Escrow Agreement to be entered into by the
Registrant and Robert Q. Crane, as Stockholders' Representative.
10.7+ Form of General Release to be executed by the stockholders of Merkert
Enterprises, Inc.
10.8+ Agreement, dated May 11, 1998, between the Registrant and Monroe &
Company, LLC.
10.9+ Agreement for the purchase of Common Stock between the Registrant and
Gerald R. Leonard, dated April 8, 1998.
10.10+ Promissory Note of Gerald R. Leonard dated April 8, 1998.
10.11+ Stock Pledge Agreement between the Registrant and Gerald R. Leonard,
dated April 8, 1998.
10.12+ Distributor's Agreement, dated January 1, 1982, between Merkert
Enterprises, Inc. and Monarch Marking Systems, Inc.
10.13+ Agreement, dated October 30, 1997, between Merkert Laboratories, Inc.
and Misco Products Corporation.
10.14+ Registration Rights Agreement, dated May 18, 1998, among the
Registrant, Monroe & Company II, LLC and Gerald R. Leonard.
10.15+ Form of Registration Rights Agreement to be entered into by the
Registrant and the stockholders of Merkert Enterprises, Inc.
10.16 Not Applicable.
</TABLE>

II-2
<PAGE>

<TABLE>
<C> <S>
10.17+ Amended and Restated Merkert American Corporation 1998 Stock Option and Incentive
Plan.
10.18+ Form of Non-Qualified Stock Option Agreement under the Merkert American Corporation
1998 Stock Option and Incentive Plan.
10.19+ Form of General Release to be executed by the Stockholders, Directors and Officers
of Rogers-American Company, Inc.
10.20+ Form of Indemnification Escrow Agreement to be entered into by the Registrant and
Curtis L. Rogers, Jr. as Stockholders' Representative.
10.21+ Security Agreement by and between Rogers-American Company of Florida, Inc. and
Rogers-American Company, Inc.
10.22+ Stock Pledge Agreement by and between Rogers-American Company, Inc. and Dopson-Hicks
of Tampa, Inc., Dopson-Hicks of Jacksonville, Inc., Dopson-Hicks of Miami, Inc. and
L.C. Hicks, Jr.
10.23+ Indenture of Mortgage, Deed of Trust, Security Agreement, Fixture Filing, Financing
Statement and Assignment of Rents and Leases, dated as of February 13, 1998, between
Merkert Enterprises, Inc. and Corporate Real Estate Capital, LLC.
10.24+ Loan Agreement by and between Corporate Real Estate Capital, LLC and Merkert
Enterprises, Inc.
10.25+ Promissory Note of Merkert Enterprises, Inc. issued to Corporate Real Estate
Capital, LLC.
10.26+ Form of Incentive Stock Option Agreement under the Merkert American Corporation 1998
Stock Option and Incentive Plan.
10.27* Amendment No. 1, dated November 3, 1998, to Stock Purchase Agreement among the
Registrant, Rogers-American Company, Inc. and the stockholders of Rogers-American
Company, Inc.
10.28* Amendment No. 1, dated November , 1998 to Stock Purchase Agreement among the
Registrant, Merkert Enterprises, Inc. and the stockholders of Merkert Enterprises,
Inc.
21.1+ Subsidiaries of the Registrant.
23.1* Consent of Counsel (included in Exhibit 5.1 hereto).
23.2 Consent of Arthur Andersen LLP.
23.3 Consent of Hege Kramer Connell Murphy & Goldkamp, P.C.
27.1+ Financial Data Schedule.
99.1+ Consent of Edward P. Grace, III to be named as a person to be appointed a Director
of the Registrant in this Registration Statement.
99.2+ Consent of James A. Schlindwein to be named as a person to be appointed a Director
of the Registrant in this Registration Statement.
99.3+ Consent of Gerald R. Leonard to be named as a person to be appointed a Director of
the Registrant in this Registration Statement.
99.4+ Consent of Douglas H. Holstein to be named as a person to be appointed a Director of
the Registrant in this Registration Statement.
</TABLE>
- --------
+ Previously filed

* To be filed by amendment

(b) The Financial Statement Schedule filed as part of this Registration
Statement is as follows:

Information required by the requested schedules is not applicable or the
required information is included in the financial statements or notes thereto.

ITEM 17. UNDERTAKINGS

The undersigned Registrant hereby undertakes to provide to the Underwriters
at the closing specified in the Underwriting Agreement certificates in such
denominations and registered in such names as required by the Underwriters to
permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has 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 registrant of expenses
incurred or paid by a director, officer

II-3
<PAGE>

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
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication
of such issue.

The undersigned registrant hereby undertakes that:

(1) For purposes of determining any liability under the Act, the
information omitted from the form of prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Act, each
post-effective amendment that contains a form of prospectus 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.

II-4
<PAGE>

SIGNATURES

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS AMENDMENT TO REGISTRATION STATEMENT TO BE SIGNED ON ITS
BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF CANTON,
COMMONWEALTH OF MASSACHUSETTS, ON NOVEMBER 4, 1998.

Merkert American Corporation

/s/ James L. Monroe
By: _________________________________
JAMES L. MONROE, PRESIDENT

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.

<TABLE>
<S> <C>
SIGNATURE TITLE DATE

/s/ James L. Monroe President and November 4,
- ------------------------------------- Director (principal 1998
JAMES L. MONROE executive,
accounting and
financial officer,
sole director)
</TABLE>

II-5
<PAGE>

EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
------- -----------
<C> <S>
1.1+ Form of Purchase Agreement.
3.1+ Form of Amended and Restated Certificate of Incorporation.
3.2+ Form of Amended and Restated By-laws.
4.1+ Specimen certificate for shares of Common Stock, $.01 par value, of
the Registrant.
5.1* Opinion of Goodwin, Procter & Hoar LLP as to the legality of the
securities being offered.
10.1+ Stock Purchase Agreement, dated May 20, 1998, among the Registrant,
Merkert Enterprises, Inc. and the stockholders of Merkert Enterprises,
Inc.
10.2+ Stock Purchase Agreement, dated May 22, 1998, among the Registrant,
Rogers-American Company, Inc. and the stockholders of Rogers-American
Company, Inc.
10.3+ Form of Employment and Non-Competition Agreement to be entered into by
the Registrant and Gerald R. Leonard, Sidney D. Rogers, Jr. and Glenn
F. Gillam.
10.4+ Form of Employment and Non-Competition Agreement to be entered into by
the Registrant and Douglas H. Holstein and Marty D. Carter.
10.5+ Form of Tax Escrow Agreement to be entered into by the Registrant and
Robert Q. Crane, as Stockholders' Representative.
10.6+ Form of Indemnification Escrow Agreement to be entered into by the
Registrant and Robert Q. Crane, as Stockholders' Representative.
10.7+ Form of General Release to be executed by the stockholders of Merkert
Enterprises, Inc.
10.8+ Agreement, dated May 11, 1998, between the Registrant and Monroe &
Company, LLC.
10.9+ Agreement for the purchase of Common Stock between the Registrant and
Gerald R. Leonard, dated April 8, 1998.
10.10+ Promissory Note of Gerald R. Leonard dated April 8, 1998.
10.11+ Stock Pledge Agreement between the Registrant and Gerald R. Leonard,
dated April 8, 1998.
10.12+ Distributor's Agreement, dated January 1, 1982, between Merkert
Enterprises, Inc. and Monarch Marking Systems, Inc.
10.13+ Agreement, dated October 30, 1997, between Merkert Laboratories, Inc.
and Misco Products Corporation.
10.14+ Registration Rights Agreement, dated May 18, 1998, among the
Registrant, Monroe & Company II, LLC and Gerald R. Leonard.
10.15+ Form of Registration Rights Agreement to be entered into by the
Registrant and the stockholders of Merkert Enterprises, Inc.
10.16 Not Applicable.
10.17+ Amended and Restated Merkert American Corporation 1998 Stock Option
and Incentive Plan.
10.18+ Form of Non-Qualified Stock Option Agreement under the Merkert
American Corporation 1998 Stock Option and Incentive Plan.
10.19+ Form of General Release to be executed by the Stockholders, Directors
and Officers of Rogers-American Company, Inc.
10.20+ Form of Indemnification Escrow Agreement to be entered into by the
Registrant and Curtis L. Rogers, Jr. as Stockholders' Representative.
10.21+ Security Agreement by and between Rogers-American Company of Florida,
Inc. and Rogers-American Company, Inc.
10.22+ Stock Pledge Agreement by and between Rogers-American Company, Inc.
and Dopson-Hicks of Tampa, Inc., Dopson-Hicks of Jacksonville, Inc.,
Dopson-Hicks of Miami, Inc. and L.C. Hicks, Jr.
10.23+ Indenture of Mortgage, Deed of Trust, Security Agreement, Fixture
Filing, Financing Statement and Assignment of Rents and Leases, dated
as of February 13, 1998, between Merkert Enterprises, Inc. and
Corporate Real Estate Capital, LLC.
10.24+ Loan Agreement by and between Corporate Real Estate Capital, LLC and
Merkert Enterprises, Inc.
10.25+ Promissory Note of Merkert Enterprises, Inc. issued to Corporate Real
Estate Capital, LLC.
10.26+ Form of Incentive Stock Option Agreement under the Merkert American
Corporation 1998 Stock Option and Incentive Plan.
</TABLE>
<PAGE>

<TABLE>
<C> <S>
10.27* Amendment No. 1, dated November 3, 1998, to Stock Purchase Agreement among the
Registrant, Rogers-American Company, Inc. and the stockholders of Rogers-American
Company, Inc.
10.28* Amendment No. 1, dated November , 1998 to Stock Purchase Agreement among the
Registrant, Merkert Enterprises, Inc. and the stockholders of Merkert Enterprises,
Inc.
21.1+ Subsidiaries of the Registrant.
23.1* Consent of Counsel (included in Exhibit 5.1 hereto).
23.2 Consent of Arthur Andersen LLP.
23.3 Consent of Hege Kramer Connell Murphy & Goldkamp, P.C.
27.1+ Financial Data Schedule.
99.1+ Consent of Edward P. Grace, III to be named as a person to be appointed a Director
of the Registrant in this Registration Statement.
99.2+ Consent of James A. Schlindwein to be named as a person to be appointed a Director
of the Registrant in this Registration Statement.
99.3+ Consent of Gerald R. Leonard to be named as a person to be appointed a Director of
the Registrant in this Registration Statement.
99.4+ Consent of Douglas H. Holstein to be named as a person to be appointed a Director of
the Registrant in this Registration Statement.
</TABLE>
- --------
+ Previously filed

* To be filed by amendment

<PAGE>

EXHIBIT 23.2

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our
reports (and to all references to our Firm) included or made a part of this
registration statement.

/s/ Arthur Andersen LLP

Arthur Andersen LLP

Boston, Massachusetts

November 3, 1998

<PAGE>

EXHIBIT 23.3

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our
reports (and to all references to our Firm) included or made a part of this
registration statement.

/s/ Hege Kramer Connell Murphy &
Goldkamp, P.C.

Hege Kramer Connell Murphy & Goldkamp,
P.C.

Philadelphia, Pennsylvania

November 4, 1998