<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended July 2, 1995 Commission file Number 1-7829
BOWL AMERICA INCORPORATED
(Exact name of registrant as specified in its charter.)
MARYLAND 54-0646173
(State of Incorporation) (I.R.S. Employer Identification No.)
6446 Edsall Road, Alexandria, Virginia 22312
(Address of principal executive offices) (Zip Code)
(703)941-6300
Registrant's telephone number, including area code
Securities Registered Pursuant to Section 12(b) of the Act:
Title of Class Name of Exchange on
which registered
Common stock (par value $.10) American Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. YES [X] NO [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K, Section 229.405 of this Chapter, is not contained
herein, and will not be contained to the best of registrant's knowledge, in
definitive Proxy or information statements incorporated by reference in Part
III of this Form 10-K or any amendments to this Form 10-K. YES [X] NO [ ]
As of August 24, 1995, 4,206,901 Class A common shares were outstanding,
and the aggregate market value of the common shares (based upon the closing
price of these shares on the American Stock Exchange) of Bowl America
Incorporated held by nonaffiliates was approximately $37 million; 1,536,146
Class B common shares were outstanding. Class B common shareholders have the
right to convert their Class B common to Class A common stock on a share for
share basis. If the Class B shares were converted to Class A shares as of
August 24, 1995, the total aggregate market value for both classes of common
stock would be approximately $51 million. (This includes the amount of
shares held by all officers and directors as a group and by anyone known to
own more than 5% of the stock.)
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE
Portions of registrant's definitive proxy statements, which will be filed
with the Commission not later than 120 days after July 2, 1995 are incorporated
into Part III of this Form 10-K. Portions of Bowl America's 1995 Annual Report
are incorporated by reference in Part II, Items 5,6,7 and 8.
<PAGE>
BOWL AMERICA INCORPORATED
INDEX TO FISCAL 1995 10-K FILING
PART I
Page
Cover Page
Documents Incorporated by Reference
Index
ITEM 1. Business
(a) General Development of Business 1
(b) Financial Information about Industry Segments 1
(c) Narrative Description of Business 1
(d) Foreign Operations 1
ITEM 2. Properties 2
ITEM 3. Legal Proceedings 2
ITEM 4. Submission of Matters to a Vote of Security Holders 2
PART II
ITEM 5. Market for Registrant's Common Stock and Related Security
Holder Matters 2
ITEM 6. Selected Financial Data 2
ITEM 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations 2
ITEM 8. Financial Statements and Supplementary Data 2
ITEM 9. Changes in and Disagreements with Accountants and
Financial Disclosure 2
PART III
ITEM 10.Directors and Executive Officers of the Registrant 3
ITEM 11.Executive Compensation 3
ITEM 12.Security Ownership of Certain Beneficial Owners and Management
(a) Security Ownership of Certain Beneficial Owners 3
(b) Security Ownership of Management 3
(c) Changes in Control 3
<PAGE>
BOWL AMERICA INCORPORATED
INDEX TO FISCAL 1995 10-K FILING
PART III
continued
Page
ITEM 13.Certain Relationships and Related Transactions
(a) Transactions with Management and Others 3
(b) Certain Business Relationships 3
(c) Indebtedness of Management 3
(d) Transactions with Promoters 3
PART IV
ITEM 14.Exhibits, Financial Statements and Reports on Form 8-K
(a)1. Financial Statements 3
(a)2. Exhibits 4
(b) Reports on Form 8-K 4
Signatures 5-6
<PAGE>
PART I
ITEM 1. BUSINESS
(a) General Development of Business
Bowl America Incorporated (herein referred to as the Company) was
incorporated in 1958. The Company commenced business with one bowling center
in 1958, and at the end of the past fiscal year, the Company and its wholly-
owned subsidiaries operated 25 bowling centers. It plans to enlarge its
bowling center in Dranesville, Virginia from 32 lanes to 48 lanes. The
Company's bowling center in Silver Hill, Maryland was closed in May 1995 as
a result of its condemnation in conjunction with the expansion of the Metro
Subway System. The Company is seeking other new bowling locations.
(b) Financial Information about Industry Segments
The Company has no segments in different industries. Its principal
source of revenue consists of fees charged for the use of bowling lanes and
other facilities and from the sale of food and beverages for consumption on the
premises. Merchandise sales, including food and beverages, were approximately
30% of operating revenues. The balance of operating revenues (approximately
70%) represents fees for bowling and related services.
(c) Narrative Description of Business
As of September 1, 1995 the Registrant and its subsidiaries operated
14 bowling centers in the greater metropolitan area of Washington, D.C., three
bowling centers in the greater metropolitan area of Baltimore, Maryland, two
bowling centers in the greater metropolitan area of Orlando, Florida, three
bowling centers in the greater metropolitan area of Jacksonville, Florida, and
three bowling centers in the greater metropolitan area of Richmond, Virginia.
These 25 bowling centers contain a total of 936 lanes. When the expansion of
the Dranesville center is completed, the 25 bowling centers will contain 952
lanes.
These establishments are fully air-conditioned with facilities for
service of food and beverages, game rooms, rental lockers, and playroom
facilities. All centers provide shoes for rental, and bowling balls are
provided free. In addition, each center retails bowling acessories.
The bowling equipment essential for the Company's operation is readily
available. The major source of its equipment is Brunswick Corporation.
The bowling business is a seasonal one, and most of the business takes
place from October through May. It is highly competitive, but the Company has
managed to maintain its position in the field. The principal method of
competition is the quality of service furnished to the Company's customers.
Its primary competitors are two large bowling equipment manufacturers, Brunswick
Corporation and AMF, Inc.
Compliance with federal, state and local environmental protection laws
has not materially affected the Company.
The number of persons employed by the Company and its subsidiaries is
approximately 800.
(d) Foreign Operations
The Company has no foreign operations.
<PAGE>
ITEM 2. PROPERTIES
The Company's general offices are located at 6446 Edsall Road,
Alexandria, Virginia 22312.
Nine of the Company's bowling centers are located in leased premises,
and the remaining sixteen centers (including the new center in Gaithersburg,
Maryland) are owned by the Company. The Company's leases, giving effect to
option renewal periods, expire from 1997 through 2014 and the remainder there-
after. In addition to the above, there is one ground lease which expires in
2058. The specific locations of the bowling centers are discussed under
Item 1 (c).
ITEM 3. LEGAL PROCEEDINGS
There are no material pending legal proceedings other than ordinary
routine litigation incidental to the business. There were no legal proceedings
terminated during the fourth quarter ended July 2, 1995.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the
fourth quarter ended July 2, 1995.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED SECURITY HOLDER
MATTERS
The information set forth in the section entitled "Market
Information", "Holders", and "Dividends" on page 3 of the Company's July 2,
1995 Annual Report is incorporated by reference herein.
ITEM 6. SELECTED FINANCIAL DATA
The information set forth in the section entitled "Selected Financial
Data" on page 3 of the Company's July 2, 1995 Annual Report is incorporated by
reference herein.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The information set forth in the section entitled "Management's
Discussion and Analysis of Financial Condition and Results of Operations" on
page 2 of the Company's July 2, 1995 Annual Report is incorporated by reference
herein.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The Consolidated Financial Statements and related notes thereto, the
Independent Auditors' Report and the Selected Quarterly Financial Data
(unaudited), as contained on pages 4 through 10 of the Company's July 2, 1995
Annual Report, are incorporated by reference herein.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
None
<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Pursuant to General Instruction G(3) of Form 10-K, the information
called for by this item regarding directors is hereby incorporated by reference
from the Company's definitive proxy statement to be filed pursuant to
Regulation 14A not later than 120 days after the end of the fiscal year covered
by this report.
ITEM 11. EXECUTIVE COMPENSATION
Pursuant to General Instruction G(3) of Form 10-K, the information
called for by this item is hereby incorporated by reference from the Company's
definitive proxy statement to be filed pursuant to Regulation 14A not later
than 120 days after the end of the fiscal year covered by this report.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Pursuant to General Instruction G(3) of Form 10-K, the information
called for by this item is hereby incorporated by reference from the Company's
definitive proxy statement to be filed pursuant to Regulation 14A not later
than 120 days after the end of the fiscal year covered by this report.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Pursuant to General Instruction G(3) of Form 10-K, the information
called for by this item is hereby incorporated by reference from the Company's
definitive proxy statement to be filed pursuant to Regulation 14A not later
than 120 days after the end of the fiscal year covered by this report.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENTS AND REPORTS ON FORM 8-K
(a)1. Financial Statements
The following consolidated financial statements of Bowl America
Incorporated and its subsidiaries are incorporated by reference
in Part II, Item 8:
Independent auditors' report
Consolidated balance sheets - July 2, 1995 and July 3, 1994
Consolidated statements of earnings - years ended July 2, 1995,
July 3, 1994, and June 27, 1993
Consolidated statements of stockholders' equity - years ended
July 2, 1995, July 3, 1994, and June 27, 1993
Consolidated statements of cash flows - years ended July 2, 1995
July 3, 1994, and June 27, 1993
Notes to the consolidated financial statements - years ended
July 2, 1995, July 3, 1994, and June 27, 1993
<PAGE>
(a)2. Exhibits:
1. Articles of Incorporation as amended
2. Subsidiaries of registrant
(b) Reports on Form 8-K:
The Company filed a report on Form 8-K with respect to the
authorization of its President to purchase at his discretion from time
to time up to 600,000 shares of the Company's common stock on behalf
of the Company.
The Company also filed a report on Form 8-K with respect to the
new employment contract with Leslie H. Goldberg, President, for the
period from July 1, 1995 to June 30, 1996.
<PAGE>
BOWL AMERICA INCORPORATED
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Company has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
BOWL AMERICA INCORPORATED
Leslie H. Goldberg
Leslie H. Goldberg
President and Principal Executive
& Operating Officer
Date: September 28, 1995
Ruth Macklin
Ruth Macklin
Senior Vice President-Treasurer
Date: September 28, 1995
Cheryl A. Dragoo
Cheryl A. Dragoo
Assistant Treasurer and Controller
Principal Accounting Officer
Date: September 28, 1995
<PAGE>
BOWL AMERICA INCORPORATED
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and the dates indicated.
Name, Title, Capacity
Leslie H. Goldberg
Leslie H. Goldberg
President, Principal Executive
& Operating Officer & Director
Date: September 28, 1995
Ruth Macklin Howard Katzman
Ruth Macklin Howard Katzman
Senior Vice President-Treasurer Senior Vice President-Secretary
and Director and Director
Date: September 28, 1995 Date: September 28, 1995
Joan Sobkov A. Joseph Levy
Joan Sobkov A. Joseph Levy
Director Director
Date: September 28, 1995 Date: September 28, 1995
Warren T. Braham Merle Fabian
Warren T. Braham Merle Fabian
Director Director
Date: September 28, 1995 Date: September 28, 1995
Milton Lyons
Milton Lyons
Director
Date: September 28, 1995
<PAGE>
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
PRESIDENT'S LETTER
September 21, 1995
Dear Fellow Owners,
Bowling Alone...the words that took us from our occasional appearances on the
sports or business pages to the editorial and features sections. "Bowling
Alone: Democracy in America at the End of the Twentieth Century" is the title
of a paper delivered at a Nobel Symposium in Sweden by a Harvard political
science professor, Robert Putnam. The paper has since been cited by Newt
Gingrich, Barbara Mikulski, and George Will among others, and even presented
at Camp David.
Putnam concluded that our society is endangered by the membership decline in
face to face groups. He cites PTAs, the Federation of Women's Clubs and the
Boy Scouts among these groups, but clearly the reference that caught everyone's
attention was his inclusion of bowling leagues. Putnam noted that during the
period he was studying total bowling participation increased while league mem-
bership declined. William Powers, writing in The Washington Post, argued per-
suasively not to worry---we were really individualists all along. George Will,
whose son Jon is a regular Bowl America bowler, felt that the first sign of the
success of conservatism would be increased participation in bowling leagues.
With an election year approaching such a burden is almost too much to bear.
Dr. Putnam designates bowling leagues as sites of democrary because of the
interaction among the members that spreads beyond their immediate involvement
in the competition, building what he calls social capital. He feels that
participating together builds patterns of cooperation that are vital to our
ability to deal with community problems. Those of you who have visited this
space in the past will know how pleased we are to see a public discussion of
the value of being a participant, rather than a spectator, particularly when
every state in which we operate is considering public financing of spectator
sports venues. Our experience is consistent with all of the recent economic
studies, which suggests that such funding simply results in a shift in
recreation spending from doing to watching.
Nothing in this review of how people spend their leisure time suggests any
change in the observations we have shared previously with you. People adjust
their recreation activities to accommodate changes in their schedules. They
do not increase their total recreation expenditures as more options become
available; rather they reorder their priorities. They change their total
recreation expenditures as their expectations of their earnings change, except
in the case of gambling, which often diverts money from other activities.
There is of course an interrelation among these influences. When members of
our daytime ladies leagues started to go back to work in the late seventies
they had more money to spend on recreation, but were no longer available when
we had the most open lanes. And over the last few years the decline in
construction work gave some of our best customers more time off, but their
reduced earnings expectations meant they were no longer bowling as much.
Contrary to the view I expressed here only last year, it is clear now that
people in the Washington area have continuing concerns about their future
earnings, particularly if they are in any way dependent on the federal
government.
<PAGE>
We will also face the problem that many of our customers will reorder their
priorities because of actions beyond our control. In Maryland, for all
practical purposes, you can no longer smoke in a bowling center. We have
already seen a dramatic decline in league bowling in the centers effected,
as smokers find the restriction limits their enjoyment of the game, and there
has been no increase in "non-smoking" traffic.
As recently as 1992 I reported to you that we built our service concept around
the league bowler, becoming the bowling centers for people who loved to bowl.
Our theory was that you needed regular participation to develop the skills to
make the game most interesting. But variety in itself is an attribute of fun
and there is a substantial group of people that would rather be Jacks of all
Trades. In any case, we must adapt to the fact that it is getting more diff-
icult to recruit league bowlers by making our leagues more attractive, and by
finding non-league promotions that rely on something other than price
reductions to generate sales.
Our physical facilities are better than they have ever been and they are near
our potential customers. We have been using independent shoppers who have
reported that our service is better than it has ever been. Male and female
bowlers skills overlap to such an extent that leagues can be organized without
regard to gender. Almost anyone can be taught to bowl. And over 95% of adults
do not currently bowl in a league.
That's a great potential for a great game whose importance to the community is
being recognized anew. It's a potential we have the staff, the facilities and
the commitment to realize.
Leslie H. Goldberg
Leslie H. Goldberg, President
<PAGE>
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
Cash flow provided by operating activities in fiscal 1995 was $4,272,000 which
was sufficient to meet day-to-day cash needs. Short-term investments consist-
ing mainly of U.S. Treasury Bills and Notes, and cash totaled $7,635,000 at the
end of fiscal 1995 compared to $8,470,000 at the end of fiscal 1994.
On September 1, 1994, the Company opened Bowl America Gaithersburg, a 48-lane
center with a 170-seat, full service, diner-style restaurant. Of the approxi-
mately $5 million cost for land, construction and equipment, $1.6 million was
spent in fiscal 1995. This location is contributing to cash flow. Additional
expenditures of over $1 million were made in the fiscal year as part of our
ongoing modernization process.
In July 1993, the Company paid $1.8 million in cash for an existing 32-lane
center in Orange Park, Florida, which immediately began contributing to cash
flow.
During fiscal 1996 the Company plans to expand one bowling center and continue
our capital improvements program. Cash and cash flow are adequate to finance
all currently planned construction. The Company has maintained its fiscal year
end 1994 position in telecommunications stocks as a further source of expansion
capital.
Cash dividends paid to shareholders during fiscal 1995 (the twenty-third
consecutive year of increased dividends) were over $2 million. A two-for-one
stock split in the form of a dividend was paid February 15, 1995.
The Company adopted SFAS No. 115, "Accounting for Certain Investments in Debt
and Equity Securities" effective July 4, 1994. Upon application of this
standard our investment in telecommunications stocks is listed at market value.
The net effect of the implementation was to increase stockholders' equity by
approximately $1.3 million.
RESULTS OF OPERATIONS
The Company operated one more bowling center during the peak season of fiscal
1995 than in fiscal 1994 and two more than in fiscal 1993. Bowl America Gaith-
ersburg, which opened in September 1994, is a unique location. In addition to
offering a full service restaurant, the location is open 24 hours a day impact-
ing both revenues and expenses to a greater extent than any other new location.
A center was closed in May 1995 at the expiration of its lease. In addition to
the purchased center mentioned above, a new 32-lane center opened in February
1993. A leased center was closed in September 1992. Fiscal 1995 and 1993 were
52-week years while fiscal 1994 was a 53-week year. It is the change in the
number of operating centers more than any other factor which is responsible for
the differences discussed below.
Operating revenues increased 5% in 1995 versus a 3% increase in fiscal 1994.
Bowling and related services revenue was up 4% in each year. This year the
impact of the new center was greater than the loss of the fifth-third week. In
the prior year bowling income increased as a result of a higher average price
<PAGE>
per game. Uncharacteristic weather conditions continue to have an effect on
our results. Mild, precipitation-free weather such as we had in fiscal 1995
historically reduces open play games. But is was the unusual cold, snow and
ice which caused a loss of games in fiscal 1994.
Food and merchandise sales were up 6% in the current year compared to a 2%
increase in the prior year. Food and beverage sales were up 5% in the current
year versus a slight increase in the prior year. Diner.X.Press, the full
service restaurant at our Gaithersburg location was the reason for the current
year increase. Sales at comparable locations actually declined partially as a
result of decreased traffic. Sales of alcoholic beverages have declined over
the past two years reflecting a national trend away from alcohol consumption.
Cost of food and merchandise sales increased 11% in the current year due to
higher sales and higher costs primarily at Diner.X.Press where we promoted
heavily to establish our menu and market presence. There was no increase in
cost in the prior period mainly due to improved portion and inventory control.
Operating expenses increased 11% in 1995 versus an increase of 5% in the prior
year. Approximately half the increase in both years can be attributed to the
increase in employee compensation and benefits brought about by staffing new
locations in each year.
Maintenance and supply costs were up in both years mainly as a result of the
new locations. Utility costs were up 8% in the current year with Gaithersburg
accounting for all of the increase. Utility costs were up 9% in the prior year
partially due to extreme winter and summer temperatures in fiscal 1994.
Advertising costs increased 13% in the current year versus a 6% increase in the
prior year. Media campaigns to promote bowling were conducted in both years
and in the current year we increased advertising to promote our new center and
Diner.X.Press restaurant.
Insurance expenses increased 25% in fiscal 1995 versus a 10% decline in the
prior year period. The current year increase results from an industry wide
upward trend in premiums brought about by the multiple disasters in the United
States in the past several years and the additional premium for Gaithersburg.
Depreciation expense increased 13% and 21% in fiscal 1995 and 1994 respectively
substantially due to our opening new locations in both years.
Income tax percentages were 36.1% in 1995, 37.3% in 1994 and 37.2% in 1993, the
difference from statutory rates being primarily for the partial exclusion of
dividends received on investments and the state income tax exemption for
interest on U.S. Government obligations.
-2-
<PAGE>
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
CONSOLIDATED SUMMARY OF OPERATIONS
Selected Financial Data
<TABLE>
<CAPTION>
For the Years Ended
July 2, July 3, June 27, June 28, June 30,
1995 1994 1993 1992 1991
___________________________________________________________
<S> <C> <C> <C> <C> <C>
Operating Revenues $29,493,578 $28,171,010 $27,234,560 $25,984,500 $26,423,399
Operating Expenses 24,967,878 22,568,589 21,530,864 20,890,788 20,694,541
Interest and dividend
Income 593,207 479,938 620,745 817,905 895,062
__________ __________ __________ __________ __________
Earnings before pro-
vision for income
taxes 5,118,907 6,082,359 6,324,441 5,911,617 6,623,920
Provision for income
taxes 1,849,000 2,265,000 2,350,000 2,195,000 2,485,000
__________ __________ __________ __________ __________
Net Earnings $ 3,269,907 $ 3,817,359 $ 3,974,441 $ 3,716,617 $ 4,138,920
Weighted Average
Shares Outstanding 5,747,746 5,760,568 5,783,648 5,784,616 5,753,816
Earnings Per Share $.57 $.66 $.69 $.64 $.72
Net Cash Provided by
Operating Activities $4,271,585 $6,621,007 $4,879,381 $4,357,103 $5,416,779
Dividends Paid $2,069,302 $2,017,736 $1,937,832 $1,851,323 $1,755,029
Dividends Paid Per
Share-Class A $.36 $.35 $.335 $.32 $.305
-Class B $.36 $.35 $.335 $.32 $.305
Total Assets $36,584,745 $33,594,994 $31,611,489 $29,470,784 $28,289,372
Stockholders' Equity $32,443,501 $29,947,687 $28,451,547 $26,474,223 $24,482,386
Net Book Value Per
Share $5.64 $5.20 $4.92 $4.58 $4.25
Net Earnings as a %
of Beginning Stock-
holders' Equity 10.9% 13.4% 15.0% 15.2% 18.8%
Lanes in Operation 936 936 904 912 896
Centers in Operation 25 25 24 24 24
</TABLE>
All share and per share amounts have been adjusted to reflect the declaration of
a two-for-one stock split effective February 15, 1995.
<PAGE>
Market Information
The principal market on which the Company's Class A Common Stock is traded is
the American Stock Exchange. The Company's Class B Common Stock is not listed
on any exchange and is not traded. This stock can be converted to Class A
Common Stock at any time. The table below presents the price range of the
Company's Class A stock in each quarter of fiscal 1995 and 1994.
<TABLE>
<CAPTION>
1995 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
_______________________________________________________
<S> <C> <C> <C> <C>
High 9 7/16 8 13/16 8 1/4 8
Low 8 3/8 7 7/8 7 3/8 7 1/2
</TABLE>
<TABLE>
<CAPTION>
1994 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
_______________________________________________________
<S> <C> <C> <C> <C>
High 11 1/4 10 15/16 9 7/8 10
Low 10 11/16 9 1/2 9 9/16 9 7/16
</TABLE>
Holders
The approximate number of holders of record of the Company's Class A Common
Stock as of July 2, 1995 is 653 and of the Company's Class B Common Stock is 36.
Dividends
The table below presents the dividends per share of Class A and Class B stock
paid, and the quarter in which the payment was made during fiscal 1995 and 1994.
Dividends per share have been adjusted to give retroactive effect to the two-
for-one stock split paid February 1995.
<TABLE>
<CAPTION>
Class A Common Stock
Quarter 1995 1994
___________________________________________
<S> <C> <C>
First 9 cents 8.5 cents
Second 9 cents 8.5 cents
Third 9 cents 9 cents
Fourth 9 cents 9 cents
</TABLE>
<TABLE>
<CAPTION>
Class B Common Stock
Quarter 1995 1994
___________________________________________
<S> <C> <C>
First 9 cents 8.5 cents
Second 9 cents 8.5 cents
Third 9 cents 9 cents
Fourth 9 cents 9 cents
</TABLE>
See notes to consolidated financial statements.
-3-
<PAGE>
<PAGE>
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
July 2, 1995 July 3, 1994
____________ ____________
<S> <C> <C>
ASSETS
Current Assets
Cash and cash equivalents (Note 2) $ 973,678 $ 3,468,677
Short-term investments (Note 3) 6,660,958 5,001,435
Inventories 617,130 586,435
Prepaid expenses and other 562,217 373,674
Income taxes refundable 444,626 -
__________ __________
Total Current Assets 9,258,609 9,430,221
Property, Plant and Equipment, Net (Note 5) 23,399,267 22,449,044
Other Assets
Noncurrent marketable securities (Note 4) 3,093,555 857,782
Cash surrender value-officers'life insurance 347,312 314,016
Other long-term assets 486,002 498,931
__________ __________
TOTAL ASSETS $36,584,745 $33,549,994
</TABLE>
<PAGE>
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
July 2, 1995 July 3, 1994
_____________ ____________
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
Current Liabilities
Accounts payable $ 693,280 $ 768,812
Accrued expenses and payroll deductions 1,047,266 1,260,954
Income taxes payable - 112,676
Other current liabilities 441,698 413,865
Current deferred income taxes (Note 9) 72,000 11,000
__________ __________
Total Current Liabilities 2,254,244 2,567,307
Noncurrent Deferred Income Taxes (Note 9) 1,887,000 1,035,000
TOTAL LIABILITIES 4,141,244 3,602,307
__________ __________
Commitments (Note 6)
Stockholders' Equity (Note 7)
Preferred stock,
par value $10 a share: Authorized
and unissued 2,000,000 shares
Common stock,
par value $.10 per share
Authorized 10,000,000 shares
Class A issued
4,206,931 and 1,333,019 shares 420,693 133,302
Class B issued
1,536,146 and 1,543,046 153,614 154,304
Additional paid-in capital 4,944,585 5,257,734
Unrealized gain on securities
available-for-sale, net of tax 1,385,940 -
Retained earnings 25,538,669 24,402,347
__________ __________
TOTAL STOCKHOLDERS' EQUITY $32,443,501 $29,947,687
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $36,584,745 $33,549,994
<FN>
See notes to consolidated financial information.
</TABLE>
-4-
<PAGE>
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
<TABLE>
<CAPTION>
For the Years Ended
July 2, 1995 July 3, 1994 June 27, 1993
______________________________________________
<S> <C> <C> <C>
Operating Revenues
Bowling and other $20,558,584 $19,713,148 $18,911,466
Food and merchandise sales 8,934,994 8,457,862 8,323,094
__________ __________ __________
29,493,578 28,171,010 27,234,560
Operating Expenses
Compensation and benefits 12,760,142 11,503,091 11,047,527
Cost of bowling and other 6,776,985 6,095,296 5,867,945
Cost of food and mdse sales 2,688,905 2,433,906 2,433,634
Depreciation and amortization 1,941,730 1,714,920 1,415,571
General and administrative 800,116 821,376 766,187
__________ __________ __________
24,967,878 22,568,589 21,530,864
Operating Income 4,525,700 5,602,421 5,703,696
Interest and dividend income 593,207 479,938 620,745
__________ __________ __________
Earnings before provision
for income taxes 5,118,907 6,082,359 6,324,441
Provision for income taxes(Note 9)
Current 1,786,000 2,255,000 2,240,000
Deferred 63,000 10,000 110,000
__________ __________ __________
1,849,000 2,265,000 2,350,000
Net Earnings $ 3,269,907 $ 3,817,359 $ 3,974,441
Earnings Per Share $.57 $.66 $.69
<FN>
See notes to consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
COMMON STOCK Net Unrealized
_______________________________________ Additional Gain on Avail-
Class A Class A Class B Class B Paid-In able-for-Sale Retained
Shares Amount Shares Amount Capital Securities Earnings
<S> <C> <C> <C> <C> <C> <C> <C>
Balance June 28, 1992 1,349,833 $134,983 1,543,046 $154,304 $5,277,595 - $20,907,341
Purchase of stock (2,784) (278) - - (5,624) (53,383)
Cash dividends paid(33.5 cents/sh) - - - - - (1,937,832)
Net earnings for the year - - - - - 3,974,441
______________________________________________________________________________________________________________________
Balance June 27, 1993 1,347,049 $134,705 1,543,046 $154,304 $5,271,971 - $22,890,567
Issuance of stock to ESOP 800 80 - - 15,720 -
Purchase of stock (14,830) (1,483) - - (29,957) (287,843)
Cash dividends paid(35 cents/sh) - - - - - (2,017,736)
Net earnings for the year - - - - - 3,817,359
______________________________________________________________________________________________________________________
Balance July 3, 1994 1,333,019 $133,302 1,543,046 $154,304 $5,257,734 - $24,402,347
Adoption of SFAS No.115 - - - - - $1,337,267 -
Two-for-one stock split 2,872,553 287,255 - - (287,255) - -
Stock issuance cost - - - - (17,500) - -
Conversion from Class B to Class A 6,900 690 (6,900) (690) - - -
Purchase of stock (5,541) (554) - - (8,394) - (64,283)
Cash dividends paid(36 cents/sh) - - - - - - (2,069,302)
Change in unrealized gain on
available-for-sale securities - - - - - 48,673 -
Net earnings for the year - - - - - - 3,269,907
______________________________________________________________________________________________________________________
Balance July 2, 1995 4,206,931 $420,693 1,536,146 $153,614 $4,944,585 $1,385,940 $25,538,669
<FN>
See notes to consolidated financial statements.
</TABLE>
-5-
<PAGE>
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
July 2, July 3, June 27,
1995 1994 1993
<S> <C> <C> <C>
Cash Flows From Operating Activities
Net earnings $3,269,907 $3,817,359 $3,974,441
Adjustments to reconcile net
earnings to net cash provided
by operating activities:
Depreciation and amortization 1,941,730 1,714,920 1,415,571
Increase in deferred income taxes 63,167 10,427 110,000
Loss (gain) on disposition of assets-net 21,779 4,132 (17,911)
Changes in assets and liabilities:
(Increase) decrease in inventories (30,695) 48,575 (137,668)
(Increase) decrease in prepaid expenses
and other (188,543) 294,265 (135,356)
Decrease(increase)in other long-term assets 12,929 (207,924) 124,238
(Decrease) increase in accounts payable (75,532) 27,487 97,915
(Decrease) increase in accrued expenses and
payroll deductions (213,688) 204,845 (25,821)
(Decrease) increase in income taxes payable
or refundable (557,302) 619,991 (531,291)
Increase in other current liabilities 27,833 86,930 5,263
_________ _________ _________
Net cash provided by operating activities $4,271,585 $6,621,007 $4,879,381
_________ _________ _________
Cash flows from investing activities
Expenditures for property,plant,equipment (2,913,732) (5,447,576) (2,870,928)
Net (increase) decrease in short-term
investments (1,659,523) 1,654,639 1,233,790
Other (33,296) (15,452) (13,366)
_________ _________ _________
Net cash used in investing activities (4,606,551) (3,808,389) (1,650,504)
_________ _________ _________
Cash flows from financing activities
Payment of cash dividends (2,069,302) (2,017,736) (1,937,832)
Stock issuance cost (17,500) - -
Sale of Class A Common Stock to ESOP - 15,800 -
Purchase of Class A Common Stock (73,231) (319,283) (59,285)
_________ _________ _________
Net cash used in financing activities (2,160,033) (2,321,219) (1,997,117)
_________ _________ _________
Net(Decrease)Increase in Cash and Equivalents(2,494,999) 491,399 1,231,760
Cash and Cash Equivalents, Beginning of Year 3,468,677 2,977,278 1,745,518
_________ _________ _________
Cash and Cash Equivalents, End of Year $ 973,678 $3,468,677 $2,977,278
Supplemental Disclosures of Cash Flow Information
Cash paid during the year for
Income taxes $2,268,126 $1,635,009 $2,820,229
Interest $1,528 $1,528 $4,751
See notes to financial information.
</TABLE>
-6-
<PAGE>
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Description of Business
Bowl America Incorporated is engaged in the operation of 25 bowling
centers, with food and beverage service in each center. Fourteen centers are
located in metropolitan Washington D.C., three centers in metropolitan
Baltimore, Maryland, two centers in metropolitan Orlando, Florida, three
centers in metropolitan Richmond, Virginia, and three centers in metropolitan
Jacksonville, Florida. These 25 centers contain a total of 936 lanes.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company
and all of its wholly owned subsidiary corporations. All significant inter-
company items have been eliminated in the consolidated financial statements.
Fiscal Year
The Company's fiscal year ends on the Sunday nearest to June 30. Fiscal
year 1995 ended July 2, 1995, fiscal year 1994 ended July 3, 1994, and fiscal
year 1993 ended June 27, 1993. Fiscal year 1994 consisted of 53 weeks. Fiscal
years 1995 and 1993 each consisted of 52 weeks.
Depreciation and Amortization
Depreciation and amortization for financial statement purposes are calcu-
lated by use of the straight-line method. Amortization of leasehold improve-
ments is calculated over the estimated useful life of the asset or term of the
lease, whichever is shorter. The categories of property, plant, and equipment
and the ranges of estimated useful lives on which depreciation and amortization
rates are based are as follows:
Bowling lanes and equipment 3-10 years
Building and building improvements 10-30 years
Leasehold improvements 10 years
Maintenance and repairs and minor replacements are charged to expense when
incurred. Major replacements and betterments are capitalized. The accounts
are adjusted for the sale or other disposition of property, and the resulting
gain or loss is credited or charged to income.
Inventories
Inventories are stated at the lower of cost (first-in, first-out method)
or market.
<PAGE>
Income Taxes
Prior to June 28, 1993, the Company accounted for income taxes under APB
Opinion 11. Under the provisions of APB 11, deferred income taxes result from
the recognition of the income tax effect of timing differences in reporting
transactions for financial reporting and income tax purposes. Such timing
differences relate principally to depreciation of equipment, leasehold improve-
ments, and deferred compensation arrangements.
Effective June 28, 1993, the Company adopted Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes" (SFAS No. 109),
which requires an asset and liability approach to financial accounting and
reporting for income taxes. Deferred income tax assets and liabilities are
computed annually for differences between the financial statement and tax bases
of assets and liabilities that will result in taxable or deductible amounts in
the future based on enacted tax laws and rates applicable to the periods in
which the differences are expected to affect taxable income. Valuation allow-
ances are established when necessary to reduce deferred tax assets to the amount
expected to be realized. Income tax expense is the tax payable or refundable
for the period plus or minus the change during the period in deferred tax
assets and liabilities.
Fair Value of Financial Instruments
The fair value of the noncurrent marketable security portfolio is disclosed
in Note 4. The cost of all other financial instruments approximates fair value.
Investment Securities
Effective July 4, 1994, the Company adopted Statement of Financial Account-
ing Standards No. 115 (SFAS No. 115) entitled "Accounting for Certain Invest-
ments in Debt and Equity Securities". The standard requires debt and equity
securities to be segregated into the following three categories: trading, held-
to-maturity and available-for-sale. Trading securities are purchased and held
principally for the purpose of reselling them within a short period of time.
Their unrealized gains and losses are included in earnings. Debt securities
classified as held-to-maturity will be accounted for at amortized cost, and
require the Company to have both the positive intent and ability to hold those
securities to maturity. Securities not classified as either trading or held-
to-maturity are considered to be available-for-sale. Unrealized gains and
losses for available-for-sale securities are excluded from earnings and
reported, net of deferred taxes, as a separate component of stockholders'
equity until realized. Realized gains and losses on the sale of debt and
equity securities are reported in earnings and determined using the adjusted
cost of the specific security sold. The impact of the adoption of SFAS No. 115
is shown on the Consolidated Statements of Stockholders' Equity.
Earnings Per Share
For the years ended July 2, 1995, July 3, 1994, and June 27, 1993, earnings
per share have been calculated using the weighted average number of shares of
Class A and Class B common stock outstanding of 5,747,746, 5,760,568 and
5,783,648, respectively. As discussed in Note 7, during the year ended July 2,
1995, the Company declared a 2-for-1 stock split in the form of a dividend.
Prior year amounts have been restated to reflect the impact of this transaction.
-7-
<PAGE>
Cash and Cash Equivalents
For purposes of the Consolidated Statements of Cash Flows, the Company
considers money market funds, certificates of deposits, repurchase agreements
and treasury securities with original maturities of three months or less to be
cash equivalents.
2. CASH AND CASH EQUIVALENTS
Cash and cash equivalents consisted of the following:
July 2, July 3,
1995 1994
Demand deposits and cash on hand $ 458,180 $ 530,536
Money market funds 179,498 826,141
Repurchase agreements 336,000 2,112,000
________ _________
$ 973,678 $3,468,677
3. SHORT-TERM INVESTMENTS
Short-term investments consist of certificates of deposits, U.S. Treasury
securities, and a mutual fund which invests in mortgage backed securities with
maturities of generally three months to one year. The Company has classified
the debt and equity securities as available for sale. The cost of these invest-
ments approximates fair value.
4. NONCURRENT MARKETABLE SECURITIES
At July 2, 1995, noncurrent marketable securities are carried at fair value
in accordance with the provisions of SFAS No. 115. At July 3, 1994, noncurrent
marketable securities were carried at the lower of cost or market value. At
July 3, 1994, the market value of securities was $3,015,049 and the cost was
$857,782.
This portfolio was comprised of the following individual stocks as of
July 2, 1995:
6,194 shares of American Telephone and Telegraph
8,112 shares of Ameritech
5,304 shares of Bell Atlantic
6,893 shares of Bell South
5,324 shares of NYNEX
5,424 shares of Pactel Group
8,148 shares of Southwestern Bell
5,612 shares of US West
16,000 shares of Sprint Corporation
5,424 shares of Air Touch Communications
<PAGE>
A summary of the amortized cost and approximate fair values of equity
securities available-for-sale shown in the table above as of July 2, 1995, is
as follows:
<TABLE>
<CAPTION>
Original Unrealized Fair
Cost Gain Value
<S> <C> <C> <C>
July 2, 1995
Securities available-for-sale $857,782 $2,235,773 $3,093,555
</TABLE>
5. PROPERTY, PLANT, AND EQUIPMENT
Property, plant, and equipment, as cost, consist of the following:
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Bowling lanes and equipment $17,069,097 $16,205,762
Buildings and building improvements 15,052,465 12,370,257
Leasehold improvements 1,029,037 1,326,206
Land 7,698,228 7,462,563
Bowling lanes and equipment not yet in use 515,407 2,150,472
__________ __________
41,364,234 39,515,260
Less accumulated depreciation and
amortization 17,964,967 17,066,216
__________ __________
$23,399,267 $22,449,044
</TABLE>
6. COMMITMENTS
Lease Commitments
The Company and its subsidiaries are obligated under long-term real estate
lease agreements for nine bowling centers. Certain of the Company's real
estate leases provide for additional annual rents based upon total gross
revenues and increases in real estate taxes and insurance. Generally, the
leases contain renewal options ranging from 5 to 10 years.
At July 2, 1995, the minimum fixed rental commitments related to all
noncancelable leases, were as follows:
Year Ending
1996 $ 534,000
1997 524,484
1998 400,000
1999 400,000
2000 400,000
Thereafter 1,291,630
_________
Total minimum lease payments $3,550,114
Net rental expense was as follows:
For the Years Ended
1995 1994 1993
Minimum rental under operating leases $581,000 $498,000 $512,827
Excess percentage rentals 181,899 265,485 260,403
_______ _______ _______
$762,899 $763,485 $773,230
-8-
<PAGE>
7. STOCKHOLDERS' EQUITY
The Company declared a 2-for-1 stock split in the form of a dividend
effective February 15, 1995, wherein both Class A and Class B stockholders
received one share of Class A common stock for each share of Class A and
Class B common stock held as of the date of record. All prior years earnings
per share and dividends per share have been restated to reflect the impact of
this transaction.
The Class A shares have one vote per share voting power. The Class B
shares may vote ten votes per share and are convertible to Class A shares at
the option of the stockholder.
8. PROFIT-SHARING AND ESOP PLAN
The Company has a profit-sharing plan which, generally, covers all individ-
uals who were employed at the end of the fiscal year and had one thousand or
more hours of service during that fiscal year. The Plan provides for Company
contributions as determined by the Board of Directors. For the years ended
July 2, 1995, July 3, 1994, and June 27, 1993, contributions in the amount of
$130,000, $155,000, and $165,000, respectively, were charged to operations.
Effective March 31, 1987, the Company adopted an Employee Stock Ownership
Plan (ESOP) which generally covers all employees who on the last day of the
fiscal year or December 29 have been employed for one year with at least one
thousand hours of service. The Plan provides for Company contributions as
determined by the Board of Directors. In fiscal years 1994 and 1993, the
contributions were allocated to participants based on compensation and years of
service. Fiscal year 1995 contributions were allocated based on compensation
only in order to comply with Internal Revenue Service code requirements. The
Company's contributions to the Plan for fiscal years 1995, 1994, and 1993 were
$130,000, $155,000, and $165,000, respectively.
9. INCOME TAXES
Income tax expense differs from the amounts computed by applying the U.S.
Federal income tax rate to income before tax for the following reasons:
<TABLE>
<CAPTION>
For the Years Ended
1995 % 1994 % 1993 %
<S> <C> <C> <C> <C> <C> <C>
Taxes computed at statutory rate $1,740,000 34.0% $2,067,000 34.0% $2,150,310 34.0%
State income taxes, net of Federal
income tax benefit 190,000 3.7 232,000 3.8 225,720 3.6
Dividends received exclusion (29,000) (0.6) (29,000) (0.5) (29,009) (0.5)
All other-net (52,000) (1.0) (5,000) - 2,979 0.1
_________ ____ _________ ____ _________ ____
$1,849,000 36.1% $2,265,000 37.3% $2,350,000 37.2%
</TABLE>
<PAGE>
The significant components of the Company's deferred tax assets and liabil-
ities were as follows:
1995 1994
Deferred tax assets:
Accrued expenses $ 70,000 $ 78,000
Deferred tax liabilities:
Property, plant and equipment 1,037,000 1,035,000
Unrealized gain on available-
for-sale securities 850,000 -
Prepaid expenses 79,000 51,000
Other 63,000 38,000
_________ _________
Total deferred tax liabilities 2,029,000 1,124,000
_________ _________
Net deferred income taxes $1,959,000 $1,046,000
10. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
The following summary represents the results of operations for each of the
quarters in fiscal 1995 and 1994 (dollars in thousands, except for earnings per
share):
<TABLE>
<CAPTION>
Earnings
Before
Provision Earnings
Operating Gross for Income Net Per
Revenues Profit Taxes Earnings Share
<S> <C> <C> <C> <C> <C>
1995
July 2, 1995 $6,242 $ 628 $ 814 $ 578 $.10
April 2, 1995 9,373 2,592 2,765 1,722 .30
January 1, 1995 8,148 1,582 1,701 1,062 .19
October 2, 1994 5,731 (276) (161) (92) (.02)
1994
July 3, 1994 $6,660 $1,013 $1,148 $ 725 $.12
March 27, 1994 8,461 2,682 2,818 1,765 .31
December 26, 1993 7,599 1,868 1,968 1,236 .21
September 26, 1993 5,451 39 148 91 .02
</TABLE>
-9-
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Stockholders
Bowl America Incorporated
Alexandria, Virginia
We have audited the accompanying consolidated balance sheets of Bowl
America Incorporated and subsidiaries as of July 2, 1995 and July 3, 1994, and
the related consolidated statements of earnings, stockholders' equity and cash
flows for each of the three years in the period ended July 2, 1995. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of Bowl America Incorporated and
subsidiaries as of July 2, 1995 and July 3, 1994, and the results of their
operations and their cash flows for each of the three years in the period ended
July 2, 1995, in conformity with generally accepted accounting principles.
As discussed in Note 1 to the consolidated financial statements effective
July 4, 1994, the Company changed its method of accounting for investment
securities and effective June 28, 1993, the Company changed its method of
accounting for income taxes.
Deloitte and Touche LLP
McLean, Virginia
August 30, 1995
-10-
<PAGE>
ARTICLES OF INCORPORATION
OF
BOWL AMERICA INCORPORATED
* * * * *
FIRST: WE, THE UNDERSIGNED, Thomas E. Kingston, Robert M. Dougherty
and Gordon E. R. Gleim, the post-office address of each of whom is No. 557
Munsey Building, Washington, D.C., each being at least twenty-one years of age,
do, under and by virtue of the General Laws of the State of Maryland authoriz-
ing the formation of corporations, associate ourselves as incorporators with
the intention of forming a corporation.
SECOND: The name of the corporation is
BOWL AMERICA CORPORATION
THIRD: The purposes for which the corporation is formed are:
To acquire by purchase, lease or otherwise, to own, equip, erect,
build, construct, maintain, lease, let, rent, license, operate and otherwise
turn to account, bowling alley, billiard parlors, pool rooms and all other
places of amusement and entertainment, either public or private, and to own
maintain, operate, license, equip, and otherwise provide and furnish any
facilities and conveniences appurtenant thereto, including soda fountains,
restaurants, snack bars and lunch stands, to sell non-alcoholic and
alcoholic beverages, as may be permitted by law, and to grant concessions,
franchises and rights to others to carry on any lawful business that may be
necessary, useful or convenient in furthering the objects and purposes of
the corporation.
To manufacture, buy, sell, repair, service, import, export, and
generally to trade and deal in and with all goods, supplies, appliances
and equipment, including, but not by way of limitation, bowling alleys,
bowling balls, pins and pin-setting equipment, billiard tables, billiard
and pool balls and cue sticks, and any and all related supplies, equipment,
apparatus and facilities used or capable of being used in any business of
the corporation.
To purchase, or otherwise acquire, invest in, own, improve, hold,
and operate for investment or otherwise, develop, improve, mortgage, pledge,
sell, lease, or otherwise dispose of improved and unimproved real estate
whereever situated.
To import, export, manufacture, produce, buy, sell and otherwise
deal in and with, goods, wares and merchandise of every class and
description.
To engage in and carry on any other business which may conveniently
be conducted in conjunction with any of the business of the corporation.
To acquire all or any part of the good will, rights, property and
business of any person, firm, association or corporation heretofore or
hereafter engaged in any business similar to any business which the
corporation has the power to conduct, and to hold, utilize, enjoy and in any
manner dispose of the whole or any part of the rights, property and business
so acquired, and to assume in connection therewith any liabilities of any
such person, firm, association or corporation.
To apply for, obtain, purchase or otherwise acquire, any patents,
copyrights, licenses, trade-marks, trade names, rights, processes, formulas,
and the like, which may seem capable of being used for any of the purposes of
the corporation; and to use, exercise, develop, grant licenses in respect of,
sell and otherwise turn to account, the same.
To acquire by purchase, subscription or in any other manner, take
receive, hold, use, employ, sell, assign, transfer, exchange, pledge,
mortgage, lease, dispose of and otherwise deal in and with, any shares of
stock, shares, bonds, debentures, notes, mortgages or other obligations, and
certificates, receipts, warrants or other instruments evidencing rights or
options to receive, purchase or subscribe for the same or representing any
other rights or interests therein or in any property or assets, issued or
created by any persons, firms, associations, corporations, syndicates, or
by any governments or subdivisions thereof; and to possess and exercise in
respect thereof any and all the rights, powers and privileges of individual
holders.
To aid in any manner any person, firm, association, corporation or
syndicate, any shares of stock, shares, bonds, debentures, notes, mortgages
or other obligations of which, or any certificates, receipts, warrants or
other instruments evidencing rights or options to receive, purchase or
subscribe for the same, or representing any other rights or interests
therein, are held by or for this corporation, or in the welfare of which this
corporation shall have any interest, and to do any acts or things designed
to protect, preserve, improve and enhance the value of any such property or
interest, or any other property of this corporation.
To guarantee the payment of dividends upon any shares of stock or
shares in, or the performance of any contract by, any other corporation or
association in which this corporation has an interest, and to endorse or
otherwise guarantee the payment of the principal and interest, or either, of
any bonds, debentures, notes or other evidence of indebtedness created or
issued by any such other corporation or association.
To carry out all or any part of the foregoing objects as principal,
factor, agent, contractor, or otherwise, either alone or through or in
conjunction with any person, firm, association or corporation; and, in
carrying on its business and for the purpose of attaining or furthering any
of its objects and purposes, to make and perform any contracts and to do any
acts and things, and to exercise any powers suitable, convenient or proper
for the accomplishment of any of the objects and purposes herein enumerated
or incidental to the powers herein specified, or which at any time may
appear conducive to or expedient for the accomplishment of any of such
objects and purposes.
To carry out all or any part of the aforesaid objects and purposes,
and to conduct its business in all or any of its branches, in any or all
states, territories, districts and possessions of the United States of
America and in foreign countries; and to maintain offices and agencies in any
or all states, territories, districts and possessions of the United States of
America and in foreign countries.
The foregoing objects and purposes shall, except when otherwise
expressed, be in no way limited or restricted by reference to or inference
from the terms of any other clause of this or any other article of these
articles of incorporation of any amendment thereto, and shall each be
regarded as independent, and construed as powers as well as objects and
purposes.
The corporation shall be authorized to exercise and enjoy all of the
powers, rights and privileges granted to, or conferred upon, corporations of
a similar character by the General Laws of the State of Maryland now and
hereinafter in force, and the enumeration of the foregoing powers shall not
be deemed to exclude any powers, rights or privileges so granted or conferred.
FOURTH: The post-office address of the principal office of the
corporation in this state is No. 10 Light Street, Baltimore 2, Maryland.
The name of the resident agent of the corporation in this State is The
Corporation Trust Incorporated, a corporation of this State, and the
post-office address of the resident agent is No. 10 Light Street, Baltimore,
2, Maryland.
FIFTH (a): The total number of shares of stock which the corporation
shall have authority to issue is one million (1,000,000) shares, all of one
class, of the par value of Ten Cents ($.10) each and of the aggregate par
value of One Hundred Thousand Dollars ($100,000.00).
(b): Any and all such shares issued and for which the full
consideration has been paid or delivered shall be deemed fully paid stock and
the holder of such shares shall not be liable for any further call or
assessment or any other payment thereon.
SIXTH: The number of directors of the corporation shall be three (3),
which number may be increased or decreased pursuant to the by-laws of the
corporation and shall never be less than three (3). The names of the directors
who shall act until the first annual meeting or until their sucessors are duly
chosen and qualify are:
Jerome J. Dick
C. Edward Goldberg
Lipman Redman
SEVENTH: The following provisions are hereby adopted for the purpose
of defining, limiting and regulating the pwers of the corporation and of the
directors and stockholders:
(a) The board of directors is empowered to amend the corporation's
by-laws without consent of the stockholders.
(b) The board of directors of the corporation is hereby empowered
to authorize the issuance from time to time of shares of its stock of any class
whether now or hereafter authorized, and securities convertible into shares of
its stok of any class, whether now or hereafter authorized, for such
consideration as said board of directors may deem advisable subject to such
limitations and restrictions, if any, as may be set forth in the by-laws of
the corporation.
(c) No holder of any of the shares of the stock of the corporation
shall be entitled as of right to purchase or to subscribe for any unissued
stock of any class or of any additional shares of any class to be issued by
reason of any increase of its authorized capital stock of the corporation of
any class, or bonds, certificates of indebtedness, debentures or other
securities convertible into stock of the corporation or carrying any right to
purchase stock of any class, but any such unissued stock or such additional
authorized issue of any stock or of other securities convertible to stock or
carrying any right to purchase stock may be issued and disposed of pursuant
to resolutions of the board of directors to such persons, firms, corporations
or associations and upon such terms as may be deemed advisable by the board of
directors in the exercise of its discretion.
(d) Notwithstanding any provision of law requiring a greater
proportion than a majority of the votes of all classes or of any class of stock
entitled to be cast, to take or authorize any action, the corporation may take
or authorize such action upon the concurrence of a majority of the aggregate
number of the votes entitled to be cast thereon.
(e) Without the assent or vote of the stockholders to authorize
and issue obligations of the corporation secured or unsecured and to include
therein such provisions as to redemption convertibility or otherwise as the
board of directors in its sole descretion may determine, and to authorize the
mortgaging or pledging as security therefor of any property of the corporation,
real or personal, including after acquired property.
(f) To establish bonus profit sharing or other types of incentive
or compensation plans for the employees (including officers and directors) of
the corporation and to fix the amount of profits to be distributed or shared
and to determine the persons who will participate in any such plan and the
amounts of their articipation.
(g) The board of directors shall have power to determine from
time to time whether and to what extent and at what times and places and under
what conditions and regulations the books, accounts and documents of the
corporation, or any of them, shall be open to the inspection of stockholders,
except as so provided no stockholder shall have any right to inspect any book,
account or document of the corporation unless authorized so to do by resolution
of the board of directors.
(h) Any contract, transaction or act of the corporation or of the
directors which shall be ratified by a majority of a quorum of the stockholders
having voting powers at any annual meeting, or at any special meeting called
for such purpose, shall so far as permitted by law be as valid and as binding
as though ratified by every stockholder of the corporation.
(i) Unless the by-laws otherwise provide, any officer or employee
of the corporation (other than a director) may be removed at any time with or
without cause by the board of directors or by any committee or superior officer
upon whom such power of removal may be conferred by the by-laws or by
authority of the board of directors.
(j) Notwithstanding any provision of law requiring any action to
be taken or authorized by the affirmative vote of the holders of a majority or
other designated otherwise to be taken or authorized by vote of the stock-
holders, such action shall be effective and valid if taken or authorized by
the affirmative vote of the holders of a majority of the total number of
shares outstanding and entitled to vote thereon, except as otherwise provided
in the charter or in the by-laws, but in cases in which the law authorizes
such action to be taken or authorized by a less vote, such action shall be
effective and valid if so taken or authorized, except as otherwise provided
in the charter or in the by-laws.
(k) The corporation reserves the right from time to time to make
any amendments of its charter which may now or hereafter be authorized by law,
including any amendments changing the term of any of its outstanding stock by
classification, reclassification or otherwise; but no such amendment which
changes the terms of any of the outstanding stock shall be valid unless such
change in the terms thereof shall have been authorized by the holders of
Fifty One per centum (51%) of the shares of such stock at the time outstanding,
by a vote at a meeting or in writing with or without a meeting.
EIGHTH: The duration of the corporation shall be perpetual.
IN WITNESS WHEREOF, we have signed these articles of incorporation
on July 21, 1958.
THOMAS E. KINGSTON
Thomas E. Kingston
WITNESS: ROBERT M. DOUGHERTY
Robert M. Dougherty
CHARLES S. PEEBLES GORDON E. R. GLEIM
Charles S. Pebbles Gordon E. R. Gleim
DISTRICT OF COLUMBIA) ss:
I hereby certify that on July 21, 1958, before me, the subscriber,
a notary public of the District of Columbia, personally appeared Thomas E.
Kingston, Robert M. Dougherty, and Gordon E. R. Gleim and severally
acknowledged the foregoing articles of incorporation to be their act.
Witness my hand and notarial seal or stamp the day and year last
above written.
CHARLES S. PEBBLES
Charles S. Pebbles
Notary Public - D.C.
CHARLES S. PEBBLES
NOTARY PUBLIC
DISTRICT OF COLUMBIA My Commission Expires
March 14, 1962
BOWL AMERICA INCORPORATED
Amendment to Articles of Incorporation
December 21, 1961
ARTICLE SECOND: The name of the Corporation is Bowl America
Incorporated.
BOWL AMERICA INCORPORATED
Amendment to Articles of Incorporation
Dated December 5, 1972
FIFTH (a): The total number of shares of stock which the Corporation
shall have authority to issue is two million (2,000,000) shares, all of one
class, of the par value of Ten Cents ($.10) each and of the aggregate par value
of Two Hundred Thousand Dollars ($200,000.00).
AMENDMENT TO ARTICLES OF INCORPORATION
December 6, 1983
FIFTH (a): The total number of shares of all classes which the
Corporation has authority to issue is Six Million (6,000,000), of which Five
Million (5,000,000) shares shall be Common Stock, with a par value of ten cents
(10c) per share, and One Million (1,000,000) shares shall be Preferred Stock,
with a par value of Ten Dollars ($10.00) per share, so that the aggregate par
value of all authorized shares of all classes of stock is Ten Million, Five
Hundred Thousand Dollars ($10,500,000)).
The designations and the preferences, conversion and other rights, voting
powers, restrictions, limitations as to dividends, qualifications, and terms and
conditions of redemption of the shares of each class of stock are as follows:
PREFERRED STOCK
The Preferred Stock may be issued from time to time by the Board of
Directors as shares of one or more series. The Description of shares of each
series of Preferred Stock, including any preferences, conversions and other
rights, voting powers, restrictions, limitations as to dividends, qualifica-
tions, and terms and conditions of redemption shall be as set forth in
resolutions adopted by the Board of Directors and in Articles Supplementary
filed as required by law from time to time prior to the issue of any shares of
such series.
The Board of Directors is expressly authorized, prior to issuance, by
adopting resolutions providing for the issue of, or providing for a change in
the number of, shares of any particular series of Preferred Stock and, if and to
the extent from time to time required by law, by filing Articles Supplementary,
to set or change the number of shares to be included in each series of Preferred
Stock and to set or change in any one or more respects the designations,
preferences, conversion or other rights, voting powers, restrictions, limita-
tions as to dividends, qualifications, or terms and conditions of redemption
relating to the shares of each such series. Notwithstanding the foregoing, the
Board of Directors is not authorized to change the right of the Common Stock
of the Corporation to one vote per share on all matters sumitted for share-
holder action. The authority of the Board of Directors with respect to each
series of Preferred Stock shall include, but not be limited to, setting or
changing the following:
(1) the distinctive serial designation of such series and the number
of shares constituting such series [provided that the aggregate number of
shares constituting all series of Preferred Stock shall not exceed One
Million (1,000,000)];
(2) the annual dividend rate on shares of such series, whether
dividends shall be cumulative and, if so, from which date or dates;
(3) whether the shares of such series shall be redeemable and, if
so, the terms and conditions of such redemption, including the date or
dates upon and after which such shares shall be redeemable, and the amount
per share payable in case of redemption, which amount may vary under
different conditions and at different redemption dates;
(4) the obligation, if any, of the Corporation to retire shares of
such series pursuant to a sinking fund;
(5) whether shares of such series shall be convertible into, or
exchangeable for, shares of stock of any other class or classes and, if so,
the terms and conditions of such conversion or exchange, including the
price or prices or the rate or rates of conversion or exchange and the
terms of adjustment, if any;
(6) whether the shares of such series shall have voting rights, in
addition to any voting rights provided by law, and, if so, the terms of
such voting rights;
(7) the rights of the shares of such series in the event of
voluntary or involuntary liquidation, dissolution or winding up of the
Corporation; and
(8) any other relative rights, powers, preferences, qualifications,
limitations or restrictions thereof relating to such series;
provided that nothing herein shall authorize the Board of Directors of the
Company to change the rights of the Common Stock of the Corporation to one vote
per share on all matters submitted for shareholder action.
COMMON STOCK
Subject to all of the rights of the Preferred Stock as expressly provided
herein, by law or by the Board of Directors pursuant to this Article FIFTH, the
Common Stock of the Corporation shall possess all such rights and privileges as
are afforded to capital stock by applicable law in the absence of any express
grant of rights or privileges in Articles of Incorporation, including, but not
limited to, the following rights and privileges:
(1) dividends may be declared and paid or set apart for payment
upon the Common Stock out of any assets or funds of the Corporation
legally available for the payment of dividends;
(2) the holders of Common Stock shall have the right to vote for
the election of directors and on all other matters requiring stockholder
action, each share being entitled to one vote; and;
(3) upon the voluntary or involuntary liquidation, dissolution or
winding up of the Corporation, the net assets of the Corporation shall be
distributed pro rata to the holders of the Common Stock in accordance with
their respective rights and interests.
The holders of shares of the capital stock of any class of the Corporation
shall not have any pre-emptive or preferential rights of subscription to any
shares of any class of stock of the Corporation, or to securities convertible
into stock, whether now or hereafter authorized.
The Board of Directors of the Corporation is hereby empowered to authorize
the issuance from time to time of shares of stock of any class, whether now or
hereafter authorized, and securities convertible into shares authorized, for
such consideration as the Board of Directors may deem advisable, subject to such
limitations and restrictions, if any, as may be set forth in the By-laws of the
Corporation.
AMENDMENT TO ARTICLES OF INCORPORATION
December 4, 1984
ARTICLE FIFTH
FIFTH (a) The total number of shares of all classes of stock which the
Corporation has authority to issue is Six Million (6,000,000), of which (a)
Five Million (5,000,000) shall be Common Stock, with a par value of ten cents
($0.10) per share, consisting of that many shares of (i) Class A Common Stock,
(ii) Class B Common Stock, and (iii) such other classes of Common Stock, as the
Board of Directors may determine from time to time, and (b) One Million
(1,000,000) shares shall be Preferred Stock, with a par value of ten dollars
($10.00) per share, so that the aggregate par value of all authorized shares of
all classes of stock is Ten Million, Five Hundred Thousand Dollars
($10,500,000).
(b) The designations and the preference, conversion and other rights,
voting powers, restrictions, limitations as to dividends, qualifications, and
terms and conditions of redemption of the shares of each class of stock shall
be determined by the Board of Directors from time to time except as specified
as follows:
I. GENERAL
1. The holders of shares of the capital stock of any class of the
Corporation shall not have any preemptive or preferential rights of subscription
to any shares of any class of stock of the Corporation, or to securities
convertible into stock, whether now or hereafter authorized.
2. The Board of Directors of the Corporation is expressly authorized to
issue from time to time shares of stock of any class, whether now or hereafter
authorized, and securities convertible into shares of its stock of any class
whether now or hereafter authorized, for such consideration as the Board of
Directors may deem advisable, subject to such limitations and restrictions,
if any, as may be set forth in the By-laws of the Corproation.
II. PREFERRED STOCK
l. The Preferred Stock may be issued from time to time by the Board of
Directors as shares of one or more series. The description of shares of each
series of Preferred Stock, including any preferences, conversions and other
rights, voting powers, restrictions, limitations as to dividends, qualifica-
tions, and terms and conditions of redemption shall be as set forth in
resolutions adopted by the Board of Directors and in Articles Supplementary
filed as required by law from time to time prior to the issue of any shares of
such series.
2. The Board of Directors is expressly authorized subject to law, and to
the extent from time to time required by law, by filing Articles Supplementary,
from time to time to set or change the number of shares to be included in each
series of Preferred Stock preferences, conversion or other rights, voting
powers, restrictions, limitations as to dividends, qualifications, or terms
and conditions of redemption relating to the shares of each such series.
3. The authority of the Board of Directors with respect to each series of
Preferred Stock shall include, but not be limited to, setting or changing the
following:
(1) the distinctive serial designation of such series and the number
of shares constituting such series [provided that the aggregate number of shares
constituting all series of Preferred Stock shall not exceed One Million
(1,000,000).
(2) the annual dividend rate on shares of such series, whether
dividends shall be cumulative and, if so, from which date or dates;
(3) whether the shares of such series shall be redeemable and, if
so, the terms and conditions of such redemption, including the date or dates
upon and after which such shares shall be redeemable, and the amount per share
payable in case of redemption, which amount may vary under different conditions
and at different redemption dates;
(4) the obligation, if any, of the Corporation to retire shares of
such series pursuant to a sinking fund;
(5) whether shares of such series shall be convertible into, or
exchangeable for, shares of stock of any other class or classes and, if so,
the terms and conditions of such conversion or exchange, including the price
or prices or the rates of conversion or exchange and the terms of adjustment,
if any;
(6) whether the shares of such series shall have voting rights, in
addition to any voting rights provided by law, and, if so, the terms of such
voting rights.
(7) the rights of the shares of such series in the event of voluntary
or involuntary liquidation, dissolution or winding up of the Corporation; and
(8) any other relative rights, powers, preferences, qualifications,
limitations or restrictions thereof relating to such series;
4. The shares of Preferred Stock of any one series shall be identical with
each other in all respects except as to the dates from and after which dividends
thereon shall cumulate, if cumulative.
III. COMMON STOCK
1. Subject to all of the rights of the Preferred Stock as expressly
provided herein, or by law or by the Board of Directors pursuant to this Article
FIFTH, the Common Stock of the Corporation shall possess all such rights and
privileges as are afforded to capital stock by applicable law and as specified
in these Articles of Incorporation, including, but not limited to, the following
rights and privileges:
(1) Dividends may be declared and paid or set apart for payment upon
the Common Stock out of any assets or funds of the Corporation legally avail-
able for the payment of dividends on such terms and with such differences
among different classes of common stock as may be provided by the Board of
Directors from time to time.
(2) the holders of Common Stock shall have the right to vote for
the election of directors and on all other matters requiring stockholder
action, each share being entitled to such voting rights as may be provided by
the Board of Directors from time to time.
(3) upon the voluntary or involuntary liquidation, dissolution or
winding up of the Corporation, the net assets of the Corporation shall be
distributed pro rata to the holders of the Common Stock in accordance with
their respective rights and interests.
2. Special Provisions As to Voting and Dividend Rights of the Class A
Common Stock and the Class B Common Stock. The Board of Directors has the
power to issue that many shares of Class A Common Stock and Class B Common
Stock, as it may deem advisable from time to time with such rights of conver-
sion and other rights as shall be determined by the Board of Directors from
time to time except that provisions as to voting and dividends.
(1) Voting Rights
(a) With respect to all matters upon which stockholders are entitled
to vote or to which stockholders are entitled to give consent, each share of
the Class A Common Stock shall be entitled to one (1) vote and each share of the
Class B Common Stock shall be entitled to ten (10) votes, and except with
respect to the election of directors of the Corporation, the Class A Common
Stock and the Class B Common Stock shall be voted together without regard to
class. With respect to the election of directors of the Corporation, (a) the
Class A Common Stock will be voted as a separate class and the holders thereof
shall have the right to elect twenty-five percent (25%) calculated to the
nearest whole number, rounding a fractional number of five-tenths (.5) or more
to the next highest whole number of the total number of directors of the
Corporation fixed from time to time by, or in the manner provided for in, the
By-laws of the Corporation, and (b) the Class B Common Stock will be voted as
a separate class and the holders thereof shall have the right to elect the
balance [seventy-five percent (75%)] of the directors.
(b) With respect to any proposed amendment to these Articles of
Incorporation which would (i) increase or decrease the number or par value of
authorized shares or (ii) change the powers, preferences, relative voting
power or special reghts, of the shares of Class A Common Stock or Class B
Common Stock so as to affect them adversely, the approval of a majority of the
votes entitled to be cast by the holders of the class affected by the proposed
amendment, voting separately as a class, shall be obtained, unless and to the
extent that a larger proportion may be required by law.
(2) Dividends and Distributions
(a) Cash Dividends. Beginning with the first dividend to be
declared after the date of the 1984 Annual Meeting of the Corporation (i.e.,
the first quarter of calendar year 1985) and for the next eleven (11)
quarters in which the Corporation pays a previously declared cash dividend
(the Dividend Preference Period), the cash dividend payable on each share of
Class A Common Stock shall be twenty percent (20%) higher (the "20% Preference")
than the cash dividend payable on each share of Class B Common Stock. For
purposes of calculating the 20% Preference, the amount of the cash dividend
payable on shares of Class A Common Stock shall be rounded up to the next
highest half cent. After the expiration of the Dividend Preference Period,
each share of Class A Common Stock and each share of Class B Common Stock shall
be entitled to receipt of cash dividends, as and when declared by the
Corporation, on an equal basis.
(b) Other Dividends and Distributions. Each share of Class A Common
Stock and each share of Class B Common Stock shall be equal in respect of rights
to all dividends, other than those cash dividends specified in paragraph
(2) (a), and to all distributions, when and as declared, in the form of stock
or other property of the Corporation, except that in the case of dividends or
other distributions payable in stock of the Corporation other than Preferred
Stock, including distributions pursuant to stock split-ups or divisions, only
shares of Class A Common Stock shall be distributed with respect to Class B
Common Stock.
Dated: December 4, 1984
Article FIFTH (b) 111 2. (1) of the Corporations's Articles of
Incorporation is amended to read as follows:
2. Special Provisisons as to Voting and Dividend Rights of the Class A
Common Stock and the Class B Common Stock. The Board of Directors has the
power to issue that many shares of Class A Common Stock and Class B Common Stock
as it may deem advisable from time to time with such rights of conversion and
other rights as shall be determined by the Board of Directors from time to time
except that any shares of such stock so issued shall have the following
provisions as to voting and dividends:
(1) Voting Rights
(a) With respect to all matters upon which stockholders are
entitled to vote or to which stockholders are entitled to give consent, each
share of the Class A Common Stock shall be entitled to one (1) vote and each
share of the Class B Common Stock shall be entitled to ten (10) votes, and
except with respect to the election of directors of the Corporation, the Class
A Common Stock and the Class B Common Stock shall be voted together without
regard to class.
(b) With respect to the election of directors of the
Corporation and subject to the rules of the American Stock Exchange so long as
any class of the Corporation's stock is listed on a national securities exchange
and the rules of that exchange require special voting rules: (i) the Class A
Common Stock will be voted as a separate class and the holders thereof shall
have the right to elect twenty-five percent (25%) of the entire Board of
Directors any fraction of which shall be rounded to the next higher whole
number; (ii) the Class B Common Stock will be voted as a separate class and
the holders thereof shall have the right to elect the balance, seventy-five
per cent (75%) of the Board of Directors; (iii) if at any time the number of
shares of Class B Common Stock outstanding represents less than twelve and
one half percent (12-1/2%) of the aggregate number os shares of Class A and
Class B Common Stock outstanding, then Class A Common Stock shall have the
right together with Class B Common Stock to vote in the election of seventy-
five per cent (75%) of the entire Board of Directors while retaining the
right to elect twenty-five per cent (25%) of the entire Board of Directors.
(c) With respect to any proposed amendment to these Articles
of Incorporation which would (i) increase or decrease the number or par value
of authorized shares or (ii) change the powers, preferences, relative voting
power or special rights, of the shares of Class A Common Stock or Class B
Common Stock so as to affect them adversely, the approval of a majority of the
votes entitled to be cast by the holders of the class affected by the proposed
amendment, voting separately as a class, shall be obtained, unless and to the
extent that a larger proportion may be required by law.
Dated: December 3, 1985
Amendment to and Restatemnt
of ARTICLE FIFTH(a) of the Corporation's
Articles of Incorporation
Adopted at Stockholders Meeting held December 6, 1988
Article FIFTH (a) of the Corporation's Charter is amended to read as follows:
FIFTH(a) The total number of shares of all classes of stock which the
Corporation has authority to issue is twelve million (12,000,000), of which
(a) ten million (10,000,000) shall be Common Stock, with a par value of ten
cents ($.10) per share, consisting of that many shares of (i) Class A Common
Stock, (ii) Class B Common Stock, and (iii) such other classes of Common Stock,
as the Board of Directors may determine from time to time, and (b) two million
(2,000,000) shares shall be Preferred Stock, with a par value of ten dollars
($10.00) per share, so that the aggregate par value of all authorized shares of
all classes of stock is twenty-one million dollars ($21,000,000).
Amendment to and Restatement of
Article FIFTH (B) III 2.(2) of
the Corporation's Articles of Incorporation
Adopted at Stockholders Meeting held December 6, 1994
Article FIFTH (b) III 2.(2) of the Corporation's Articles of Incorporation
is amended to read as follows:
(2) Dividends and Distributions. Each share of Class A Common Stock and
each share of Class B Common Stock shall be equal in respect of rights to all
dividends and to all distributions, when and as declared, in the form of stock
or other property of the Corporation; provided that in the case of dividends or
other distributions payable in stock of the Corporation other than Preferred
Stock, including distributions pursuant to stock split-ups or divisions, only
shares of Class A Common Stock shall be distributed with respect to Class A
Common Stock and only shares of Class B Common Stock shall be distributed
with respect to Class B Common Stock; provided, further that, notwithstanding
the foregoing upon the recommendation of the Board of Directors and the
subsequent approval of such recommendation by the majority of votes entitled to
be cast by the holders of Class A Common Stock and Class B Common Stock, each
voting separately as a class, shares of Class A Common Stock may be distributed
equally, on a per share basis, to holders of Class A Common Stock and Class B
Common Stock.
<PAGE>
Exhibit 2
SUBSIDIARIES OF THE CORPORATION
The following table shows each of the significant subsidiaries of Registrant
and the State of Incorporation.
Subsidiary State of Incorporation
Bowl America of Florida Inc. Florida
Bowl America Shirley Inc. Virginia
Falls Church Bowl Inc. Virginia
Reisterstown Bowl Inc. Maryland
Manassas Bowl Inc. Virginia
Westwood Bowl Inc. Maryland
Bowl America Duke Inc. Virginia
The foregoing subsidiaries are wholly-owned.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<EXCHANGE-RATE> 1
<S> <C>
<PERIOD-TYPE> Year
<FISCAL-YEAR-END> JUL-02-1995
<PERIOD-END> JUL-02-1995
<CASH> 974
<SECURITIES> 3,094
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 617
<CURRENT-ASSETS> 9,259
<PP&E> 41,364
<DEPRECIATION> 17,965
<TOTAL-ASSETS> 36,585
<CURRENT-LIABILITIES> 2,254
<BONDS> 0
0
0
<COMMON> 574
<OTHER-SE> 31,870
<TOTAL-LIABILITY-AND-EQUITY> 36,585
<SALES> 8,935
<TOTAL-REVENUES> 29,494
<CGS> 2,689
<TOTAL-COSTS> 24,968
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 5,119
<INCOME-TAX> 1,849
<INCOME-CONTINUING> 3,270
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,270
<EPS-PRIMARY> .57
<EPS-DILUTED> .57
