FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Annual Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the fiscal year ended August 31, 1996
Commission File No. 1-6807
FAMILY DOLLAR STORES, INC.
(Exact name of registrant as specified in its charter)
Delaware 56-0942963
(State of incorporation) (I.R.S. Employer Identification Number)
10401 Old Monroe Road, Matthews, North Carolina 28105
(Address of principal executive offices) (Zip Code)
P. O. Box 1017, Charlotte, North Carolina 28201-1017
(Mailing address)
Registrant's telephone number, including area code (704) 847-6961
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
Common Stock, $.10 Par Value New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
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 is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. X
The aggregate market value of the voting stock of the registrant held by
non-affiliates of the registrant on November 10, 1996, was approximately
$817,900,000.
The number of shares of the registrant's Common Stock outstanding as of
November 10, 1996, was 56,868,562.
DOCUMENTS INCORPORATED BY REFERENCE
Incorporated Documents
(To the extent indicated herein) Location in Form 10-K
Annual Report to Stockholders for the Part II (Items 5, 6, 7 and 8)
fiscal year ended August 31, 1996 Part IV (Item 14)
Proxy Statement dated November 21, 1996 Part III (Items 10, 11, 12
for the Annual Meeting of Stockholders and 13)
<PAGE>
PART I
ITEM 1. BUSINESS
The original predecessor of Family Dollar Stores, Inc., was
organized in 1959 to operate a self-service retail store in Charlotte,
North Carolina. In subsequent years, additional stores were opened, and
separate corporations generally were organized to operate these stores.
Family Dollar Stores, Inc. (together with its subsidiaries referred to
herein as the "Company"), was incorporated in Delaware in 1969, and all
existing corporate entities became wholly-owned subsidiaries. Additional
stores continued to be opened and operated in wholly-owned subsidiaries
organized in the states where the stores were located. Four wholly-owned
subsidiaries organized as North Carolina corporations provide distribu-
tion, trucking, operations, marketing and other services to the Company.
The Company now operates a chain of self-service retail discount
stores. As of November 1, 1996, there were 2,602 stores in 38 states and
the District of Columbia as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Texas 262 Louisiana 83 Iowa 16
North Carolina 211 Illinois 81 Delaware 15
Georgia 173 West Virginia 75 Colorado 14
Ohio 159 New York 72 New Mexico 13
Florida 158 Mississippi 67 Connecticut 12
Virginia 129 Arkansas 51 Rhode Island 10
Tennessee 128 Missouri 51 Nebraska 9
South Carolina 115 Oklahoma 47 Minnesota 6
Alabama 105 Maryland 42 New Hampshire 4
Pennsylvania 101 Massachusetts 38 Vermont 4
Kentucky 96 Wisconsin 25 South Dakota 3
Michigan 95 Kansas 22 Maine 2
Indiana 85 New Jersey 22 District of Columbia 1
</TABLE>
The number of stores operated by the Company at the end of each of
its last five fiscal years is as follows: 1,885 stores on August 31,
1992; 2,035 stores on August 31, 1993; 2,215 stores on August 31, 1994;
2,416 stores on August 31, 1995; and 2,581 stores on August 31, 1996.
During the fiscal year ended August 31, 1996, 58 stores were
closed, 14 stores were relocated within the same shopping center or
market area, 20 stores were expanded in size and 265 stores were
remodeled or refurbished. All of the stores are occupied under leases,
except 143 stores owned by the Company. (See "Properties" herein.) The
Company has announced plans to open approximately 235 stores and close
approximately 50 stores during the current fiscal year. Such plans are
continually reviewed and subject to change depending on economic
conditions and other factors. From September 1, 1996, through
November 1, 1996, the Company opened 32 new stores, closed 11 stores,
<PAGE>
relocated 2 stores, expanded 11 stores and refurbished approximately 200
stores. All stores opening in the fiscal year ending August 31, 1997,
will have the new interior store layout that was utilized in all new
stores opened in the fiscal year ended August 31, 1996. This layout
features increased emphasis on promotional goods, improved presentation
of merchandise, lower fixtures and wider aisles for an attractive,
customer-friendly shopping environment.
As of November 1, 1996, the Company had in the aggregate approxi-
mately 20,500,000 square feet of total store space (including receiving
rooms and other non-selling areas). The typical store has approximately
6,000 to 8,000 square feet of total area. The stores are in both rural
and urban areas, and they are typically freestanding or located in
shopping centers with adequate parking available. As of November 1,
1996, there were approximately 1,335 stores located in communities with
populations of less than 15,000; approximately 500 stores in communities
with populations of 15,000 to 50,000; and approximately 767 stores in
communities with populations of over 50,000. All stores are similar in
appearance and display highly visible red and white "Family Dollar
Stores" or "Family Dollar" signs.
The Company's stores are operated on a self-service, cash-and-
carry basis, and low overhead permits the sale of merchandise at a
relatively moderate markup. During the fiscal year ended August 31,
1994, in the face of increasing competition, the Company began to change
its merchandising strategy away from promotional pricing and towards
everyday low prices. In December 1993, prices were reduced on a limited
number of items in 400 stores and in June 1994, this program was expanded
to 1,000 stores. In September and October 1994, the number of stores
with merchandise at reduced prices increased to 1,800, and the number of
stockkeeping units with price reductions increased from approximately 500
to approximately 2,500. A lesser number of price reductions were taken
in the balance of the stores in less competitive markets. No single
store accounted for more than one-fifth of one percent of sales during
the fiscal year ended August 31, 1996. Most of the stores are open six
evenings a week, and many remain open on Sunday afternoons.
The stores offer a variety of merchandise including men's,
women's, boys', girls' and infants' clothing, shoes, household products,
health and beauty aids, domestics, toys, school supplies, candy and snack
food, electronics, housewares, paint and automotive supplies. During the
fiscal year ended August 31, 1996, soft goods, including wearing apparel,
shoes, linens, blankets, bedspreads and curtains, accounted for approx-
imately 36.5 percent of the Company's sales. During the fiscal year
ended August 31, 1996, nationally advertised brand merchandise accounted
for approximately 25 percent of sales, Family Dollar label merchandise
accounted for approximately 5 percent of sales and merchandise sold under
other labels, or which was unlabeled, accounted for the balance of sales.
Irregular merchandise accounted for approximately 2 percent of sales
during such period. The Company does not accept credit cards or extend
credit.
The Company has a policy of uniform pricing of items in the majority
of its stores. A zone pricing system also is utilized in which selected
merchandise in stores in the most competitive markets carries lower
<PAGE>
prices and in stores in the least competitive markets carries higher
prices. The Company advertises through circulars which are inserted in
newspapers or mailed directly to consumers' residences, and also
advertises to a limited degree in newspapers and on radio in portions of
its operating area. As part of the Company's plan to reduce expenses to
support the program of price reductions on merchandise in its stores, in
the fiscal year ended August 31, 1995, the number of advertising
circulars distributed to consumers' homes or inserted in newspapers was
cut from 22 to 15. All seven advertising coupon booklets that were
distributed in the fiscal year ended August 31, 1994, also were
eliminated. In the fiscal year ended August 31, 1996, the number of
advertising circulars distributed was reduced from 15 to 14. In the
fiscal year ending August 31, 1997, the current plan is to again
distribute 14 circulars.
The Company has an unadvertised internal maximum price policy which
currently is to price most items of merchandise under $17.99. In the
fiscal years ended August 31, 1995 and 1996, as part of the Company's
emphasis on the sale of lower priced merchandise, the Company reduced the
average price point of merchandise sold in its stores.
The Company purchases its merchandise from approximately 1,500
suppliers and generally has not experienced difficulty in obtaining
adequate quantities of merchandise. Approximately 63 percent of the
merchandise is manufactured in the United States and substantially all
such merchandise is purchased directly from the manufacturer. Purchases
of imported merchandise are made directly from the manufacturer or from
importers. No single supplier accounted for more than 2 percent of the
merchandise sold by the Company in the fiscal year ended August 31, 1996.
Each of the Company's 22 buyers specializes in the purchase of specific
categories of goods.
During the fiscal year ended August 31, 1996, approximately
2.5 percent of the merchandise purchased by the Company was shipped
directly to its stores by the manufacturer or importer. Most of the
balance of the merchandise was received at the Company's Distribution
Centers in Matthews, North Carolina, and West Memphis, Arkansas.
Merchandise is delivered to the stores from the Distribution Centers in
Matthews and West Memphis by Company-owned trucks and by common and
contract carriers. During the last fiscal year, approximately 65 percent
of the merchandise delivered was by common or contract carriers. The
average distance between the Distribution Center in Matthews and the
approximately 1,461 stores served by that facility on August 31, 1996, is
approximately 385 miles. The average distance between the Distribution
Center in West Memphis and the approximately 1,120 stores served by that
facility on August 31, 1996, is approximately 455 miles.
The Company also operates satellite distribution buildings in
Salisbury, North Carolina, and Memphis, Tennessee. High volume, bulk
items of merchandise are shipped by vendors directly to these facilities
and then delivered to the stores by contract carriers.
The business in which the Company is engaged is highly competi-
tive. The principal competitive factors include location of stores,
price and quality of merchandise, in-stock consistency, merchandise
<PAGE>
assortment and presentation, and customer service. The Company competes
for sales and store locations in varying degrees with national and local
retailing establishments, including department stores, discount stores,
variety stores, dollar stores, discount clothing stores, drug stores,
grocery stores, outlet stores, warehouse stores and other stores. Many
of the largest retail merchandising companies in the nation have stores
in areas in which the Company operates. The relatively small size of the
Company's stores permits the Company to open new units in rural areas and
small towns, as well as in large urban centers, in locations convenient
to the Company's low and low-middle income customer base. As the
Company's sales are focused on low priced, basic merchandise, the stores
offer customers a reasonable selection of competitively priced
merchandise within a relatively narrow range of price points.
Generally, in a typical store the highest monthly volume of sales
occurs in December, and the lowest monthly volume of sales occurs in
January and February.
The Company maintains a substantial variety and depth of basic and
seasonal merchandise inventory in stock in its stores (and in distribu-
tion centers for weekly store replenishment) to attract customers and
meet their shopping needs. Vendors' trade payment terms are negotiated
to help finance the cost of carrying this inventory. The Company must
balance the value of maintaining high inventory levels to meet customers'
demands with the cost of having inventories at levels that exceed such
demands and that must be marked down in price in order to sell.
The Company has registered with the U. S. Patent and Trademark Office
the name "Family Dollar Stores" as a service mark.
On August 31, 1996, the Company had approximately 11,000 full-time
employees and approximately 9,700 part-time employees. Approximately 700
additional employees were hired on a temporary basis for the 1995
Christmas season. None of the Company's employees are covered by
collective bargaining agreements. The Company considers its employee
relations to be good.
ITEM 2. PROPERTIES
As of November 1, 1996, the Company operated 2,602 stores in 38
states and the District of Columbia. See "Business" herein. With the
exception of 143 stores owned by the Company, all of the Company's stores
were occupied under lease. Most of the leases are for fixed rentals.
A large majority of the leases contain provisions which may require
additional payments based upon a percentage of sales or property taxes,
insurance premiums or common area maintenance charges.
Of the Company's 2,459 leased stores at November 1, 1996, all but
121 leases contain options to renew for additional terms; in most cases
for a number of successive five-year periods. The following table sets
forth certain data, as of November 1, 1996, concerning the expiration
dates of all leases with renewal options:
<PAGE>
<TABLE>
<CAPTION>
Approximate Number of Approximate Number of
Leases Expiring Leases Expiring
Assuming No Exercise Assuming Full Exercise
Fiscal Years of Renewal Options of Renewal Options
<S> <C> <C>
1997 343 0
1998-2000 1,489 3
2001-2003 408 93
2004-2006 95 184
2007 and thereafter 3 2,058
</TABLE>
Of the 143 Company-owned stores, 18 are located in Texas, 16 in
North Carolina, 13 each in Georgia and Virginia, 11 each in Indiana and
Illinois, 8 in Tennessee, 7 in Michigan, 6 in Ohio, 5 each in Alabama and
Arkansas, 4 each in South Carolina, West Virginia, Florida, Kentucky and
Louisiana, 3 in Mississippi, 2 each in Iowa and Oklahoma and one each in
New Jersey, Missouri and Kansas. In these owned stores, there are
approximately 1,140,000 total square feet of space.
The Company also owns its Executive Offices and Distribution Center
which are located on a 64.5 acre tract of land in Matthews, North
Carolina, just outside of Charlotte, in a building containing
approximately 810,000 square feet of which approximately 740,000 square
feet are used for the Distribution Center which includes receiving,
warehousing and shipping facilities, and approximately 70,000 square feet
are used for Executive Offices.
During the fiscal year ended August 31, 1996, the Company leased
buildings in Salisbury, North Carolina (approximately 300,000 square
feet) and Memphis, Tennessee (approximately 270,000 square feet) to serve
as satellite distribution facilities, and a building in Charlotte, North
Carolina (approximately 80,600 square feet) to serve as a reclamation
facility for merchandise returned from the stores. These leases continue
in effect in the fiscal year ending August 31, 1997. During the fiscal
year ending August 31, 1997, the Company also is leasing another building
in Charlotte (approximately 313,000 square feet) to provide storage space
for the Distribution Center in nearby Matthews.
In 1992, the Company purchased a 75 acre parcel of land in West
Memphis, Arkansas, and construction began in 1993 on a 550,000 square
foot full-service distribution center. This facility became operational
in the spring of 1994, and currently serves approximately 1,120 stores.
The approximate $25 million cost for the land, building and equipment was
financed with cash flow from current operations and short-term borrowing
<PAGE>
under the Company's bank lines of credit. In October 1995, construction
began on a 300,000 square foot addition to this facility, and this
addition was substantially completed by the end of the Company's fiscal
year on August 31, 1996. The approximate $16 million cost for the
expansion and the related equipment is expected to be financed in the
same manner as the financing of the original facility.
The Company currently plans to begin construction of a third full-
service distribution center in Warren County, Virginia, in the spring of
1997. This facility is being designed and may contain approximately
900,000 square feet. The estimated cost of $45 million for the land,
building and equipment currently is expected to be financed with cash
flow from current operations and short-term borrowing under the Company's
bank lines of credit.
The Company owns and operates a fleet of tractor-trailers and trucks
to distribute its merchandise.
ITEM 3. LEGAL PROCEEDINGS
The Company knows of no material pending legal proceedings, other
than ordinary routine litigation incidental to the business, to which the
Company is a party or of which any of its property is subject.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted during the fourth quarter of the
fiscal year ended August 31, 1996, to a vote of security holders through
the solicitation of proxies or otherwise.
ITEM 4a. EXECUTIVE OFFICERS OF THE REGISTRANT
The following information is furnished with respect to each of the
executive officers of the Company as of November 1, 1996:
<TABLE>
<CAPTION>
Name Position and Office Age
<S> <C> <C>
Leon Levine (1) Chairman of the Board 59
and Treasurer
John D. Reier (2) President 56
George R. Mahoney, Jr. (3) Executive Vice President- 54
General Counsel and Secretary
R. David Alexander, Jr. (4) Senior Vice President- 39
Distribution and
Transportation
<PAGE>
<S> <C> <C>
Howard R. Levine (5) Senior Vice President- 37
Merchandising and
Advertising
Albert S. Rorie (6) Senior Vice President- 46
Data Processing
C. Martin Sowers (7) Senior Vice President- 38
Finance
Phillip W. Thompson (8) Senior Vice President- 47
Store Operations
Charles W. Broome (9) Vice President- 48
Store Operations
Daniel R. Burns (10) Vice President- 49
Loss Prevention
Terry A. Cozort (11) Vice President- 53
Human Resources
Bruce W. Fosson (12) Vice President- 50
Store Operations
Owen R. Humphrey (13) Vice President- 55
Distribution and
Transportation
Gilbert A. LaFare (14) Vice President- 50
Real Estate
Edgar L. Paxton (15) Vice President- 54
Advertising and
Sales Promotion
John J. Scanlon (16) Vice President- 47
General Merchandise
Manager: Hardlines
Kenneth T. Smith (17) Vice President- 34
Controller
</TABLE>
(1) Mr. Leon Levine founded the Company's business in 1959
and was its President, Chief Executive Officer and
Treasurer from 1959 until September 1977 when he was
elected Chairman of the Board, Chief Executive Officer
and Treasurer. He is the father of Howard R. Levine.
<PAGE>
(2) Mr. John D. Reier was employed by the Company as Senior
Vice President-General Merchandise Manager in August
1987, and was promoted to Senior Vice President-
Merchandising and Advertising in that month. He was
elected President in November 1994.
(3) Mr. George R. Mahoney, Jr. was employed by the Company as
General Counsel in October 1976. He was elected Vice
President-General Counsel and Secretary in April 1977,
Senior Vice President-General Counsel and Secretary in
January 1984 and Executive Vice President-General Counsel
and Secretary in October 1991.
(4) Mr. R. David Alexander, Jr. was employed by the Company
as Senior Vice President-Distribution and Transportation
in August 1995. Prior to his employment by the Company,
he was employed by Northern Automotive Co., Inc., a chain
of discount automotive supply stores, from June 1993 to
August 1995, where he was Senior Vice President-
Distribution and Transportation. Prior to his employment
by Northern Automotive Co., Inc., he was employed by Best
Products Co., Inc., a chain of catalogue showroom stores,
from June 1985 to May 1993 where he was Senior Vice
President-Distribution and Transportation.
(5) Mr. Howard R. Levine was employed by the Company in
various capacities in the Merchandising Department from
1981 to 1987, including employment as Senior Vice
President-Merchandising and Advertising. From 1988 to
1992, Mr. Levine was President of Best Price Clothing
Stores, Inc., a chain of ladies' apparel stores. From
1992 to April 1996, he was self-employed as an investment
manager. He rejoined the Company in April 1996, and was
elected Vice President-General Merchandise Manager:
Softlines in April 1996 and Senior Vice President-
Merchandising and Advertising in September 1996. He is
the son of Leon Levine.
(6) Mr. Albert S. Rorie was employed by the Company in
various capacities in the Data Processing area from March
1973 through January 1981, including employment as
Director of Data Processing. Mr. Rorie was self-employed
as a data processing consultant from January 1981 through
May 1982, when he rejoined the Company and was elected
Vice President-Data Processing. He was elected Senior
Vice President-Data Processing in January 1988.
(7) Mr. C. Martin Sowers was employed by the Company as an
Accountant in October 1984 and was promoted to Assistant
Controller in January 1985. He was elected Controller in
January 1986, Vice President-Controller in July 1989 and
Senior Vice President-Finance in December 1991.
(8) Mr. Phillip W. Thompson was employed by the Company in
January 1984 in the Store Operations Department. He was
<PAGE>
elected Vice President-Store Operations in January 1985,
and Senior Vice President-Store Operations in
January 1992.
(9) Mr. Charles W. Broome was employed by the Company in 1977
in the Store Operations Department. He was promoted to
Regional Vice President-Store Operations in February
1992. He was elected Vice President-Store Operations in
October 1996.
(10) Mr. Daniel R. Burns was employed by the Company as Vice
President-Loss Prevention in October 1994. For more than
five years prior to his employment by the Company, he was
employed by Kay-Bee Toy Stores where he was Vice
President-Loss Prevention and Shortage Control.
(11) Mr. Terry A. Cozort was employed by the Company as
Director of Human Resources in April 1988. He was
elected Vice President-Human Resources in July 1989.
(12) Mr. Bruce W. Fosson was employed by the Company in March
1992 as Regional Vice President-Store Operations. He was
elected Vice President-Store Operations in March 1996.
(13) Mr. Owen R. Humphrey was employed by the Company in
August 1979, and was promoted to Distribution Center
Operations Manager in December 1983. Mr. Humphrey was
promoted to Director of Distribution in January 1988,
and was elected Vice President-Distribution and
Transportation in July 1989.
(14) Mr. Gilbert A. LaFare was employed by the Company in
August 1992 as Vice President-Real Estate. For more
than five years prior to his employment by the Company,
he was Vice President-Real Estate with Little Caesars
Enterprises, Inc., a restaurant chain.
(15) Mr. Edgar L. Paxton was employed by the Company in
December 1985 as Director of Advertising. He was elected
Vice President-Advertising and Sales Promotion in
January 1988.
(16) Mr. John J. Scanlon was employed by the Company as
Divisional Vice President in 1992 and was elected Vice
President-General Merchandise Manager: Hardlines in
April 1996.
(17) Mr. Kenneth T. Smith was employed by the Company as a
financial analyst in March 1990. Mr. Smith was promoted
to Director of Information Services-Operations in
February 1992 and to Director of Accounting in October
1992. He was elected Vice President-Controller in
October 1995.
All executive officers of the Company are elected by and serve at
the pleasure of the Board of Directors.
<PAGE>
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS
The information required by this item is included in the Company's
Annual Report to Stockholders for the fiscal year ended August 31, 1996,
on page 16 under the captions "Market Price and Dividend Information" and
"Market Prices and Dividends" and is incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA
The information required by this item is included in the Company's
Annual Report to Stockholders for the fiscal year ended August 31, 1996,
on pages 14 and 15 under the caption "Summary of Selected Financial Data"
and is incorporated herein by reference. The Company did not have any
long-term debt at the end of each of its last five fiscal years.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The information required by this item is included in the Company's
Annual Report to Stockholders for the fiscal year ended August 31, 1996,
on pages 14 through 16 under the caption "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and is
incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this item is included in the Company's
Annual Report to Stockholders for the fiscal year ended August 31, 1996,
on pages 17 through 24 and is incorporated herein by reference.
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
The information required by this item as to Directors is included in
the Company's proxy statement dated November 21, 1996, on pages 5 through
7 under the caption "Election of Directors" and is incorporated herein by
reference. The information required by this item as to executive officers
is included in Item 4A in Part I of this report.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this item is included in the Company's
proxy statement dated November 21, 1996, on pages 7 through 13 under the
caption "Executive Compensation" and is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information required by this item is included in the Company's
proxy statement dated November 21, 1996, on pages 3 through 5 under the
caption "Ownership of the Company's Securities" and is incorporated herein
by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this item is included in the Company's
proxy statement dated November 21, 1996, on page 13 under the caption
"Related Transactions" and is incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) Documents filed as part of this report:
1 and 2. Financial Statements and Financial Statement
Schedules:
The consolidated financial statements of Family Dollar Stores,
Inc., and subsidiaries which are incorporated by reference to
the Annual Report to Stockholders for the fiscal year ended
August 31,1996, are set forth in the index on page 17 of this
report.
All schedules for which provision is made in the applicable
accounting regulations of the Securities and Exchange
Commission are not required under the related instructions, are
inapplicable or the information is included in the consolidated
financial statements, and therefore, have been omitted.
<PAGE>
The financial statements of Family Dollar Stores, Inc. (Parent
Company) are omitted because the registrant is primarily an
operating company and all subsidiaries included in the consoli-
dated financial statements being filed, in the aggregate, do
not have minority equity and/or indebtedness to any person
other than the registrant or its consolidated subsidiaries in
amounts which together exceed 5 percent of the total assets as
shown by the most recent year-end consolidated balance sheet.
3. Exhibits:
Exhibits incorporated by reference:
3(a)(i) Certificate of Incorporation, dated November 24, 1969,
(filed as Exhibit 3(a) to the Company's Registration
Statement on Form S-1, No. 2-35468).
(ii) Certificate of Amendment, dated February 2, 1972, of
Certificate of Incorporation (filed as Exhibit 3(a)(ii)
to the Company's Form 10-K (File No. 1-6807) for the year
ended August 31, 1980).
(iii) Certificate of Amendment, dated January 23, 1979, of
Certificate of Incorporation (filed as Exhibit 2 to the
Company's Form 10-Q (File No. 1-6807) for the quarter
ended February 28, 1979).
(iv) Certificate of Amendment, dated January 20, 1983, of
Certificate of Incorporation (filed as Exhibit 4(iv) to
the Company's Registration Statement on Form S-3,
No. 2-85343).
(v) Certificate of Amendment, dated January 16, 1986, of
Certificate of Incorporation (filed as Exhibit 3(a)(v) to
the Company's Form 10-K (File No. 1-6807) for the year
ended August 31, 1986).
(vi) Certificate of Amendment, dated January 15, 1987, of
Certificate of Incorporation (filed as Exhibit 3(a)(vi)
to the Company's Form 10-K (File No. 1-6807) for the year
ended August 31, 1987).
(b) By-Laws, as amended as of November 6, 1987 (filed as
Exhibit 3(b) to the Company's Form 10-K (File No. 1-6807)
for the year ended August 31, 1987).
* 10 (i) Incentive Profit Sharing Plan (filed as Exhibit 13(b)
to the Company's Registration Statement on Form S-1,
No. 2-35468).
* 10 (ii) 1989 Non-Qualified Stock Option Plan, amended as of
April 17, 1991 (filed as Exhibit 10(viii) to the
Company's Form 10-K (File No. 1-6807) for the year ended
August 31, 1991).
<PAGE>
* 10 (iii) Family Dollar Employee Savings and Retirement Plan and
Trust amended and restated as of January 1, 1987 (filed
as Exhibit 10 (viii) to the Company's Form 10-K (File No.
1-6807) for the year ended August 31, 1995).
10 (iv) Credit Agreement dated as of March 31, 1996, between the
Company and NationsBank, N.A.,(filed as Exhibit 10 to the
Company's Form 10-Q (File No. 1-6807) for the quarter
ended May 31, 1996).
Exhibits filed herewith:
* 10 (v) Amendment No. One dated January 15, 1996, to Family
Dollar Employee Savings and Retirement Plan and Trust
* 10 (vi) Employment Agreement dated September 1, 1996, between
the Company and John D. Reier
11 Statement Re: Computations of Per Share Earnings.
13 Annual Report to Stockholders for the fiscal year ended
August 31, 1996 (only those portions specifically
incorporated by reference herein shall be deemed filed).
21 Subsidiaries of the Company.
27 Financial Data Schedule
* Exhibit represents a management contract or compensatory plan.
(b) No reports on Form 8-K have been filed by the Company
during the last quarter of the period covered by this
report.
<PAGE>
FAMILY DOLLAR STORES, INC., AND SUBSIDIARIES
Index
The consolidated financial statements of Family Dollar Stores, Inc., and
subsidiaries together with the report of Price Waterhouse LLP
incorporated in this report appear on the following pages of the Annual
Report to Stockholders for the fiscal year ended August 31, 1996.
<TABLE>
<CAPTION>
Page of the
Annual Report
<S> <C>
Report of Independent Accountants 17
Consolidated Statements of Income 17
Consolidated Balance Sheets 18
Consolidated Statements of Shareholders'
Equity 19
Consolidated Statements of Cash Flows 20
Notes to Consolidated Financial Statements 21-24
</TABLE>
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
FAMILY DOLLAR STORES, INC.
(Registrant)
Date November 15, 1996 By LEON LEVINE
LEON LEVINE
Chairman of the Board
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed by the following persons on behalf of the
registrant and in the capacities and on the date indicated.
Signature Title Date
LEON LEVINE Chairman of the Board and November 15, 1996
LEON LEVINE Director (Chief Executive
Officer and Chief Financial
Officer)
JOHN D. REIER President and Director November 15, 1996
JOHN D. REIER
GEORGE R. MAHONEY, JR. Executive Vice President November 15, 1996
GEORGE R. MAHONEY, JR. and Director
C. MARTIN SOWERS Senior Vice President- November 15, 1996
C. MARTIN SOWERS Finance
KENNETH T. SMITH Vice President-Controller November 15, 1996
KENNETH T. SMITH (Principal Accounting
Officer)
MARK R. BERNSTEIN Director November 15, 1996
MARK R. BERNSTEIN
JAMES H. HANCE, JR. Director November 15, 1996
JAMES H. HANCE, JR.
JAMES G. MARTIN Director November 15, 1996
JAMES G. MARTIN
<TABLE>
<CAPTION>
FAMILY DOLLAR STORES, INC. STATEMENT RE COMPUTATIONS OF PER SHARE EARNINGS
AS PRESENTED FY 1996 FY 1995
PRIMARY FULLY DILUTED PRIMARY FULLY DILUTED
<S> <C> <C> <C> <C>
AVERAGE SHARES OUTSTANDING FOR THE YEAR ENDED 56,813,564 56,813,564 56,684,861 56,684,861
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $60,587,746 $60,587,746 $58,109,525 $58,109,525
NET INCOME $60,587,746 $60,587,746 $58,109,525 $58,109,525
EARNINGS PER SHARE:
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $1.07 $1.07 $1.03 $1.03
NET INCOME $1.07 $1.07 $1.03 $1.03
PRO FORMA DILUTION IMPACT OF COMMON STOCK EQUIVALENTS
ADDITIONAL WEIGHTED AVERAGE SHARES FROM ASSUMED EXERCISE
AT THE BEGINNING OF THE YEAR OF DILUTIVE STOCK
OPTIONS 404,977 786,794 415,663 873,018
WEIGHTED AVERAGE SHARES ASSUMED REPURCHASED FROM
ASSUMED PROCEEDS OF EXERCISES USING TREASURY STOCK
METHOD (AVERAGE MARKET PRICE FOR PRIMARY AND, IF
GREATER, ENDING MARKET PRICE FOR FULLY DILUTED) (348,859) (711,026) (356,177) (733,528)
NET PRO FORMA COMMON STOCK EQUIVALENT INCREMENTAL
SHARES 56,118 75,768 59,486 139,490
PERCENTAGE DILUTION FROM PRO FORMA COMMON
STOCK EQUIVALENT INCREMENTAL SHARES 0.10% 0.13% 0.10% 0.25%
TOTAL COMMON STOCK AND COMMON STOCK EQUIVALENTS 56,869,682 56,889,332 56,744,347 56,824,351
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $60,587,746 $60,587,746 $58,109,525 $58,109,525
NET INCOME $60,587,746 $60,587,746 $58,109,525 $58,109,525
PRO FORMA EARNINGS PER SHARE (INCLUDING DILUTIVE
COMMON STOCK EQUIVALENTS):
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $1.07 $1.07 $1.02 $1.02
NET INCOME $1.07 $1.07 $1.02 $1.02
<PAGE>
<CAPTION>
FY 1994
PRIMARY FULLY DILUTED
<C> <C>
56,496,399 56,496,399
$61,959,886 $61,959,886
$63,099,039 $63,099,039
$1.10 $1.10
$1.12 $1.12
348,548 348,548
(216,841) (216,841)
131,707 131,707
0.23% 0.23%
56,628,106 56,628,106
$61,959,886 $61,959,886
$63,099,039 $63,099,039
$1.09 $1.09
$1.11 $1.11
</TABLE>
Market Price and Dividend Information
Family Dollar's Common Stock is traded on the New York Stock Exchange under
the ticker symbol FDO. At November 1, 1996, there were aproximately 2,500
holders of record of the Common Stock. The accompanying tables give the high
and low sales prices of the Common Stock and the dividends declared per share
for each quarter of fiscal 1996 and 1995.
<TABLE>
Market Prices and Dividends
<CAPTION>
1996 High Low Dividend
<S> <C> <C> <C>
First Quarter ............. $ 19.25 $ 14.88 $ .10
Second Quarter............. 16.38 11.00 .11
Third Quarter.............. 17.75 13.75 .11
Fourth Quarter............. 18.50 14.75 .11
<CAPTION>
1995 High Low Dividend
<S> <C> <C> <C>
First Quarter.............. $ 12.63 $ 9.88 $ .08 1/2
Second Quarter............. 14.00 11.00 .10
Third Quarter.............. 13.38 10.88 .10
Fourth Quarter............. 19.75 11.63 .10
</TABLE>
<PAGE>
<TABLE>
SUMMARY OF SELECTED FINANCIAL DATA
<CAPTION>
Years Ended August 31, 1996 1995 1994 1993
<S> <C> <C> <C> <C>
Net sales............................. $1,714,627,092 $1,546,894,565 $1,428,440,427 $1,297,430,787
Cost of sales and operating expenses.. 1,615,861,346 1,452,519,040 1,328,323,366 1,194,510,816
Income before income taxes and
cumulative effect of accounting
change.............................. 98,765,746 94,375,525 100,117,061 102,919,971
Income taxes.......................... 38,178,000 36,266,000 38,157,175 38,491,288
Income before cumulative effect
of accounting change................ 60,587,746 58,109,525 61,959,886 64,428,683
Cumulative effect of change in
method of accounting for income
taxes............................... - - 1,139,153 -
Net income............................ 60,587,746 58,109,525 63,099,039 64,428,683
Earnings per common share:
Income before cumulative effect of
accounting change................... $1.07 $1.03 $1.10 $1.15
Net Income............................ $1.07 $1.03 $1.12 $1.15
Dividends declared.................... $ 24,435,102 $ 21,837,249 $ 18,656,163 $ 16,325,918
Dividends declared per common share... $.43 $38 1/2 $.33 $.29
Total assets.......................... $ 696,808,291 $ 636,233,767 $ 592,821,871 $ 537,445,610
Working capital....................... $ 273,694,125 $ 264,671,854 $ 230,234,774 $ 205,863,199
Shareholders' equity.................. $ 444,957,119 $ 407,750,588 $ 370,172,275 $ 323,281,504
<PAGE>
<CAPTION>
SUMMARY OF SELECTED FINANCIAL DATA (Continued)
1992 1991 1990 1989 1988 1987
<C> <C> <C> <C> <C> <C>
$1,158,703,861 $989,345,265 $874,395,095 $756,886,681 $669,493,241 $560,339,004
1,069,764,555 925,619,376 826,764,773 721,799,222 625,314,311 513,556,172
88,939,306 63,725,889 47,630,322 35,087,459 44,178,930 46,782,832
33,267,370 23,484,031 18,897,177 13,570,222 16,845,017 21,980,400
55,671,936 40,241,858 28,733,145 21,517,237 27,333,913 24,802,432
- - - - - -
55,671,936 40,241,858 28,733,145 21,517,237 27,333,913 24,802,432
$1.00 $0.72 $0.52 $0.39 $0.49 $0.43
$1.00 $0.72 $0.52 $0.39 $0.49 $0.43
$ 13,988,516 $ 11,960,851 $ 10,819,248 $ 9,709,104 $ 8,620,700 $ 7,835,285
$.25 $.21 1/2 $.19 1/2 $.17 1/2 $.15 1/2 $.13 1/2
$ 478,027,178 $399,271,302 $355,096,527 $324,012,452 $290,720,223 $242,005,537
$ 170,288,208 $136,207,278 $107,879,235 $ 87,228,450 $ 78,870,930 $ 83,876,967
$ 271,772,441 $227,319,970 $197,076,663 $179,135,552 $167,305,094 $159,571,825
</TABLE>
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations
Net Sales
Net sales increased approximately 10.8% ($167,733,000) in fiscal 1996
compared with fiscal 1995, and approximately 8.3% ($118,454,000) in
fiscal 1995 compared with fiscal 1994. The sales increases in both
fiscal 1996 and fiscal 1995 primarily were attributable to the increases
in the number of stores operated by the Company.
Comparable store sales increased approximately 3.7% in fiscal 1996
and decreased approximately 0.7% in fiscal 1995, as compared with the
respective prior years. Sales of hardlines merchandise were particularly
strong in fiscal 1996, increasing approximately 7.7% in comparable stores
as customers continued to respond favorably to the Company's price
reduction program and move to everyday low pricing. Sales of softlines
merchandise (primarily apparel and shoes) decreased approximately 2.6% in
comparable stores in fiscal 1996. Hardlines as a percentage of total
sales increased to 63.5% in fiscal 1996 compared to 61.0% in fiscal 1995.
In fiscal 1996, the Company reduced the number of advertising circulars
distributed from 15 to 14.
The comparable store sales decrease of 0.7% in fiscal 1995 was
attributable to decreases in softlines sales as well as reduced
advertising. In fiscal 1995, comparable stores hardlines sales increased
approximately 5.1% and softlines sales decreased approximately 8.2%. In
connection with the Company's price reduction program and move to
everyday low pricing, the Company reduced the number of advertising
circulars distributed in fiscal 1995 from 22 to 15, and eliminated all
seven advertising coupon booklets that were distributed in fiscal 1994.
The Company is pleased with customer response to its everyday low
price strategy in hardlines, and expects hardlines sales to continue to
increase as a percentage of total sales in fiscal 1997. In its efforts
to improve sales of softlines, the Company will continue to place more
emphasis on lower priced basic apparel and on closeout and other
opportunistic purchases of apparel that offer good values to the
Company's low and low-middle income customer base.
The Company also has developed a new interior store layout with a
more efficient fixture layout for softlines that reduces the space
allocated to softlines without appreciably reducing the selection of
apparel. This space previously allocated to softlines is now available
for promotional and seasonal goods as well as new hardlines categories of
merchandise. The new layout also features wider aisles, lower fixtures
and updated signage.
During fiscal 1996, the Company opened 223 stores and closed 58
stores for a net addition of 165 stores, compared with the opening of 213
stores and closing of 12 stores for a net addition of 201 stores during
fiscal 1995. All stores opened in fiscal 1996 featured the new interior
layout discussed above. In addition, approximately 265 stores were
remodeled or refurbished during fiscal 1996 with some or all of the
features of the new layout. The Company currently plans to open
approximately 235 stores and close approximately 50 stores for a net
addition of 185 stores during fiscal 1997. The Company also currently
expects to remodel or refurbish at least 200 stores and expand or
relocate approximately 100 stores in fiscal 1997. New store opening,
<PAGE>
closing, remodeling and refurbishing plans are continuously reviewed and
are subject to change depending on developments in the economy and other
factors.
Cost of Sales and Margin
Cost of sales increased approximately 11.9% ($123,126,000) in fiscal 1996
compared with fiscal 1995, and approximately 12.0% ($110,882,000) in
fiscal 1995 compared with fiscal 1994. These increases primarily
reflected the additional sales volume in each of the years. Cost of
sales, as a percentage of net sales, was 67.4% in fiscal 1996, 66.8% in
fiscal 1995, and 64.6% in fiscal 1994. The increase in the cost of sales
percentage for fiscal 1996 was due in part to the increase in sales of
hardlines merchandise, which typically carries a lower margin than
softlines. The price reduction program also continued to increase the
cost of sales percentage for the first half of fiscal 1996 compared to
the same period in fiscal 1995. This program was the primary factor in
the increase in the cost of sales percentage in fiscal 1995 compared to
fiscal 1994. The reduction in sales of apparel as a percentage of net
sales in fiscal 1995 also contributed to the increase in the cost of
sales percentage for that year compared to fiscal 1994.
The Company currently expects that the cost of sales percentage may
continue to increase in fiscal 1997 as hardlines increase as a percentage
of net sales, but expects the rate of increase may be smaller because the
initial effects of the price reduction program will no longer have a
material impact on the cost of sales percentage comparisons.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased approximately 9.6%
($40,216,000) in fiscal 1996 compared with fiscal 1995, and approximately
3.3% ($13,313,000) in fiscal 1995 compared with fiscal 1994. The
increases in these expenses primarily were attributable to additional
costs arising from the continued growth in the number of stores in
operation. As a percentage of net sales, selling, general and
administrative expenses were 26.8% in fiscal 1996, 27.1% in fiscal 1995,
and 28.4% in fiscal 1994. The percentage decrease in fiscal 1996
primarily was due to decreases in store labor costs and advertising
expenses as a percentage of net sales. In fiscal 1996, the Company
eliminated one of the 15 advertising circulars that were distributed in
fiscal 1995. These decreases were offset in part by a modest increase in
distribution expenses due to the handling of additional units of lower
priced merchandise. The percentage decrease in fiscal 1995 primarily was
due to decreases in store labor costs, corporate overhead expenses and
advertising expenses. In fiscal 1995, the Company reduced the number of
advertising circulars from 22 to 15 and eliminated all 7 coupon booklets
as part of the Company's shift from promotional pricing to everyday low
pricing. In fiscal 1997, the Company currently plans to distribute the
same number of advertising circulars (14) that were distributed in fiscal
1996. Distribution expenses are expected to continue to increase in
fiscal 1997 as the Company utilizes satellite distribution facilities to
meet its needs, and the increase in the federal minimum wage effective
October 1, 1996, will adversely impact store labor costs.
<PAGE>
Income Taxes
Income taxes increased approximately 5.3% ($1,912,000) in fiscal 1996
compared with fiscal 1995. Income taxes decreased approximately 5.0%
($1,891,000) in fiscal 1995 compared with fiscal 1994, prior to the
effect of adopting Statement of Financial Accounting Standards No. 109
("SFAS 109") (described in Note 5 to the Consolidated Financial
Statements). The increase in fiscal 1996 primarily was due to the
increase in pre-tax earnings, and the decrease in fiscal 1995 primarily
was due to the decrease in pre-tax earnings. The effective tax rate was
38.7% in fiscal 1996, 38.4% in fiscal 1995 and 38.1% in fiscal 1994,
prior to the adoption of SFAS 109. The increase in the effective tax
rate in fiscal 1996 compared to fiscal 1995 was primarily due to the
expiration of the federal Targeted Jobs Tax Credit program. The increase
in the effective tax rate in fiscal 1995 compared to fiscal 1994 resulted
primarily from changes in state income tax apportionment rates.
Liquidity and Capital Resources
The Company has consistently maintained a strong position of liquidity
and financial strength. Cash provided from operating activities during
fiscal 1996 was $81.2 million as compared to $57.8 million in fiscal 1995
and $48.8 million in fiscal 1994. These amounts have enabled the Company
to fund its regular operating needs, capital expenditure program and cash
dividend payments. In addition, the Company maintains $100,000,000 of
unsecured bank lines of credit for short-term financing and periodically
utilizes short-term borrowings to meet the cash needs of its expansion
program and seasonal inventory increases. The majority of the increase
in inventories during fiscal 1996 was due to the required inventory
investment for 165 net additional stores. There were no long-term
borrowings during fiscal 1996, 1995 or 1994.
The increase in capital expenditures to $54.3 million in fiscal
1996 from $27.7 million in fiscal 1995 was due primarily to expenditures
incurred in fiscal 1996 for a 300,000 square foot expansion of the
Company's distribution center in West Memphis, Arkansas, as well as costs
to remodel or refurbish approximately 265 existing stores. Currently
planned capital expenditures for fiscal 1997 total approximately $70
million, which primarily represent estimated expenditures for new store
expansion, existing store remodeling and refurbishing, and the
construction and equipping of a new full-service distribution center.
Construction on this new distribution facility currently is expected to
begin in the spring of 1997. The new store expansion and the additional
distribution center also will require additional investment in
merchandise inventories.
Capital spending plans, including store expansion, are continuously
reviewed and are subject to change depending on developments in the
economy and other factors. Cash flow from current operations and short-
term borrowings under the bank lines of credit are expected to be
sufficient to meet all foreseeable liquidity and capital resource needs
in both the short-term and the long-term, including store expansion and
other capital spending programs. No long-term borrowings are now
expected to be required during fiscal 1997 or immediately subsequent
periods.
<PAGE>
Recent Accounting Pronouncements
The Financial Accounting Standards Board has issued Statement of
Financial Accounting Standards No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of" ("SFAS
121") effective for fiscal years that begin after December 15, 1995.
SFAS 121, which requires long-lived assets to be reviewed for impairment
whenever events or changes in circumstances indicate that the carrying
amount of the asset may not be recoverable, will be implemented in fiscal
1997. The Company does not expect the implementation of SFAS 121 to have
a material effect on its financial position or results of operations.
The Financial Accounting Standards Board also has issued Statement
of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation" ("SFAS 123") effective for fiscal years that begin after
December 15, 1995. SFAS 123 governs accounting for employee stock
options or similar equity instruments and related compensation expense,
and allows entities to adopt a new "fair value" method to measure
compensation or, alternatively, to continue using the method prescribed
by Accounting Principles Board Opinion No. 25 ("APB 25"), the former
standard. SFAS 123 requires supplemental disclosure of the effects of
the new method if the former method continues to be utilized. The
Company intends to continue using the method prescribed by APB 25, and,
accordingly, the adoption of SFAS 123 in fiscal 1997 should not affect
the Company's financial position or results of operations.
Inflation and Other Matters
The Company's results are impacted by the effect of inflation on the cost
of its merchandise and on operating expenses. Due to the nature of the
Company's merchandise, sales levels generally have incorporated an
inflation factor which neither exceeds nor is significantly lower than
general inflation trends. The Company attempts to combat inflation in
the cost of its merchandise by shifting its source of supply or by
changing merchandise assortments. The Company's operating expenses also
tend to rise with general inflation. The increases in the federal
minimum wage rate on October 1, 1996, and September 1, 1997, will
increase store labor costs during fiscal 1997 and fiscal 1998.
Legislative initiatives to reduce federal aid to low and low-middle
income families also may adversely impact the Company's sales.
<PAGE>
Forward-Looking Statements
Certain statements contained herein and elsewhere in this Annual Report
which are not historical facts are forward-looking statements made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements address
activities or events which the Company expects will or may occur in the
future, such as future capital expenditures, store openings, closings and
remodelings, additional distribution facilities, and other aspects of the
Company's future business and operations. The Company cautions that a
number of important factors could cause actual results to differ
materially from those expressed in any forward-looking statements,
whether written or oral, made by or on behalf of the Company. Such
factors include, but are not limited to, competitive pricing pressures,
general economic conditions, inflation, merchandise supply constraints,
availability of real estate, finalizing plans for a new distribution
center, and the effects of legislation on wage levels and entitlement
programs. Consequently, all of the forward-looking statements made are
qualified by these and other factors, risks and uncertainties.
<PAGE>
<TABLE>
CONSOLIDATED STATEMENTS OF INCOME
Family Dollar Stores, Inc. and Subsidiaries
<CAPTION>
Years Ended August 31, 1996 1995 1994
<S> <C> <C> <C>
Net sales.......................................... $ 1,714,627,092 $ 1,546,894,565 $ 1,428,440,427
Costs and expenses
Cost of sales.................................... 1,156,194,732 1,033,068,759 922,186,273
Selling, general and administrative
(Notes 6 and 7).................................. 459,666,614 419,450,281 406,137,093
1,615,861,346 1,452,519,040 1,328,323,366
Income before income taxes and cumulative effect
of accounting change.......................... 98,765,746 94,375,525 100,117,061
Income taxes (Note 5)............................ 38,178,000 36,266,000 38,157,175
Income before cumulative effect of accounting change 60,587,746 58,109,525 61,959,886
Cumulative effect of change in method of accounting
for income taxes (Note 5)....................... - - 1,139,153
Net income.......................................... $ 60,587,746 $ 58,109,525 $ 63,099,039
Earnings per common share (Note 9):
Income before cumulative effect
of accounting change........................... $ 1.07 $ 1.03 $ 1.10
Cumulative effect of change in method of accounting
for income taxes............................. - - .02
Net income....................................... $ 1.07 $ 1.03 $1.12
Weighted average number of shares outstanding
during each year................................ 56,813,564 56,684,861 56,496,399
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders
of Family Dollar Stores, Inc.
In our opinion, the accompanying consolidated balance sheets and
the related consolidated statements of income, of shareholders'
equity and of cash flows present fairly, in all material respects,
the financial position of Family Dollar Stores, Inc. and its
subsidiaries at August 31, 1996 and 1995, and the results of their
operations and their cash flows for each of the three years in the
period ended August 31, 1996, in conformity with generally
accepted accounting principles. 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 of these financial statements
in accordance with generally accepted auditing standards which
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, assessing the accounting principles used and
significant estimates made by management, and evaluating the
overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
As discussed in Note 5 to the financial statements, the Company
changed its method of accounting for income taxes during 1994.
PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
October 11, 1996
Charlotte, North Carolina
<PAGE>
<TABLE>
CONSOLIDATED BALANCE SHEETS
Family Dollar Stores, Inc. and Subsidiaries
<CAPTION>
August 31, 1996 1995
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents................................. $ 18,844,839 $ 8,852,631
Merchandise inventories................................... 462,840,051 443,445,448
Deferred income taxes (Note 5)............................ 20,372,129 16,415,749
Prepayments and other current assets...................... 5,842,953 6,315,880
Total current assets .................................. 507,899,972 475,029,708
Property and equipment, net (Note 2)........................ 184,607,229 156,640,224
Other assets................................................ 4,301,090 4,563,835
$ 696,808,291 $ 636,233,767
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable (Note 3).................................... $ 4,400,000 $ -
Accounts payable.......................................... 157,011,545 156,381,205
Accrued liabilities (Note 4).............................. 65,972,111 51,589,087
Income taxes payable (Note 5)............................. 6,822,191 2,387,562
Total current liabilities.............................. 234,205,847 210,357,854
Deferred income taxes (Note 5).............................. $ 17,645,325 $ 18,125,325
Commitments and Contingencies (Note 7)
Shareholders' equity (Notes 8 and 9):
Preferred stock, $1 par; authorized and unissued 500,000 shares
Common stock, $.10 par; authorized 120,000,000 shares ...... 6,029,068 6,019,666
Capital in excess of par.................................... 16,818,916 15,774,431
Retained earnings........................................... 433,458,403 397,305,759
456,306,387 419,099,856
Less common stock held in treasury, at cost................. 11,349,268 11,349,268
444,957,119 407,750,588
$ 696,808,291 $ 636,233,767
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
Family Dollar Stores, Inc. and Subsidiaries
<CAPTION>
Capital in
Common excess Retained Treasury
Years Ended August 31, 1996, 1995 and 1994 Stock of par earnings stock
<S> <C> <C> <C> <C>
Balance, September 1, 1993
(59,804,414 shares common stock;
3,452,822 shares treasury stock)................... $5,980,441 $12,059,724 $316,590,607 $11,349,268
Net income for the year............................. 63,099,039
Issuance of 234,660 common shares under employee
stock option plans, including tax benefits (Note 8). 23,466 2,424,429
Less dividends on common stock, $ .33 per share....... (18,656,163)
Balance, August 31, 1994
(60,039,074 shares common stock;
3,452,822 shares treasury stock)................. 6,003,907 14,484,153 361,033,483 11,349,268
Net income for the year............................. 58,109,525
Issuance of 157,590 common shares under employee
stock option plan, including tax benefits (Note 8).. 15,759 1,290,278
Less dividends on common stock, $.385 per share...... (21,837,249)
Balance, August 31, 1995
(60,196,664 shares common stock
3,452,822 shares treasury stock).................. 6,019,666 15,774,431 397,305,759 11,349,268
Net income for the year............................ 60,587,746
Issuance of 94,020 common shares under employee
stock option plan, including tax benefits (Note 8). 9,402 1,044,485
Less dividends on common stock, $. 43 per share...... (24,435,102)
Balance, August 31, 1996
(60,290,684 shares common stock;
3,452,822 shares treasury stock)................ $6,029,068 $16,818,916 $433,458,403 $11,349,268
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
CONSOLIDATED STATEMENTS OF CASH FLOWS
Family Dollar Stores, Inc. and Subsidiaries
<CAPTION>
Years Ended August 31, 1996 1995 1994
<S> <C> <C> <C>
Cash flows from operating activities:
Net income........................... $ 60,587,746 $ 58,109,525 $ 63,099,039
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization.... 24,621,033 22,185,435 19,463,032
Deferred income taxes............ (4,436,380) (2,316,000) 1,328,635
Cumulative effect of accounting change..... - - (1,139,153)
Loss on disposition of property and equipment 257,167 14,799 44,947
Changes in operating assets and liabilities:
Merchandise inventories........ (19,394,603) (39,874,715) (24,215,768)
Income tax refund receivable... - 4,569,686 (4,569,686)
Prepayments and other current assets 472,927 (1,462,464) 236,305
Other assets................... 262,745 444,132 (197,940)
Accounts payable and accrued liabilities 14,435,775 13,772,751 (3,874,769)
Income taxes payable........... 4,434,629 2,387,562 (587)
Noncurrent income taxes payable - - (1,344,053)
81,241,039 57,830,711 48,830,002
Cash flows from investing activities:
Capital expenditures................ (54,264,515) (27,695,509) (42,630,031)
Proceeds from dispositions of property and equipment 1,419,310 801,374 1,323,373
(52,845,205) (26,894,135) (41,306,658)
Cash flows from financing activities:
Net change in short-term borrowings (Note 3) 4,400,000 (12,300,000) 12,300,000
Exercise of employee stock options,
including tax benefits 1,053,887 1,306,037 2,447,895
Payment of dividends............... (23,857,513) (20,972,515) (18,072,740)
(18,403,626) (31,966,478) (3,324,845)
<PAGE>
<CAPTION>
<S> <C> <C> <C>
Net increase (decrease) in cash and cash equivalents 9,992,208 (1,029,902) 4,198,499
Cash and cash equivalents at beginning of year 8,852,631 9,882,533 5,684,034
Cash and cash equivalents at end of year.. $ 18,844,839 $ 8,852,631 $ 9,882,533
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest..................... $ 576,695 $ 549,570 $ 380,784
Income taxes................. 37,920,059 31,189,881 41,815,662
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Family Dollar Stores, Inc. and Subsidiaries
Years Ended August 31, 1996, 1995 and 1994
1. Description of business and summary of significant accounting
policies:
Description of business:
The Company operates a chain of self-service retail discount stores.
Principles of consolidation:
The consolidated financial statements include the accounts of the
Company and its subsidiaries, all of which are wholly-owned. All
significant intercompany balances and transactions have been
eliminated.
Cash equivalents:
The Company considers all highly liquid investments with a maturity
of three months or less to be cash equivalents.
Merchandise inventories:
Inventories are valued using retail prices less markon percentages,
and approximate the lower of first-in, first-out (FIFO) cost or
market.
Property and equipment and depreciation:
Property and equipment is stated at cost. Depreciation for financial
reporting purposes is being provided principally by the straight-line
method over the estimated useful lives of the related assets, and by
straight-line and accelerated methods for income tax reporting
purposes.
Store opening and closing costs:
The Company charges pre-opening costs against operating results when
incurred. When a store is closed the remaining investment in fixed
assets, net of expected recovery value, is expensed. For properties
under operating lease agreements, the present value of any remaining
liability under the lease, net of expected sublease and lease
termination recoveries, is expensed when the closing is determined.
Selling, general and administrative expenses:
Buying, warehousing and occupancy costs are included in selling,
general and administrative expenses.
<PAGE>
Use of Estimates:
The preparation of the Company's consolidated financial statements, in
conformity with generally accepted accounting principles, requires
management to make estimates and assumptions. These estimates and
assumptions affect the reported amounts of assets and liabilities and
the 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 these estimates.
2. Property and equipment:
<TABLE>
<CAPTION>
August 31,
1996 1995
<S> <C> <C>
Buildings........................ $ 72,604,767 $ 62,930,713
Furniture, fixtures and equipment.. 177,135,677 168,962,333
Transportation equipment........... 13,805,879 14,783,869
Leasehold improvements............. 36,253,250 28,376,593
299,799,573 275,053,508
Less accumulated depreciation
and amortization............... 124,525,085 127,773,462
175,274,488 147,280,046
Land............................. 9,332,741 9,360,178
$ 184,607,229 $ 156,640,224
</TABLE>
The Financial Accounting Standards Board has issued Statement of
Financial Accounting Standards No. 121,"Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of"("SFAS 121") effective for fiscal years that begin after December
15, 1995. SFAS 121, which requires long-lived assets to be reviewed
for impairment whenever events or changes in circumstances indicate
that the carrying amount of the asset may not be recoverable, will be
implemented in fiscal 1997. The Company does not expect the
implementation of SFAS 121 to have a material effect on its financial
position or results of operations.
3. Lines of credit and short-term borrowings:
The Company has two unsecured bank lines of credit for short-term
revolving borrowings of up to $50,000,000 each, or $100,000,000 of
total borrowing capacity. The lines of credit expire on March 31,
1999 and March 30, 1997, respectively, and the Company expects that
the line expiring on March 30, 1997, will be extended. Borrowings
<PAGE>
under these lines of credit are at a variable interest rate based on
short-term market interest rates. The Company may convert up to
$50,000,000 of the line of credit expiring on March 31, 1999, into
either a five or seven year term loan, at the bank's variable prime
rate.
Interest expense, average and maximum borrowings outstanding and
interest rates for each of the three years in the period ended
August 31, 1996, were as follows:
<TABLE>
<CAPTION>
1996 1995 1994
<S> <C> <C> <C>
Interest expense, net
of capitalized interest
of $196,720 in 1994 $ 585,378 $ 481,886 $ 251,748
Average borrowings
outstanding............ $ 8,710,000 $ 5,828,000 $ 9,985,000
Maximum month-end
outstanding............ $ 45,800,000 $ 36,100,000 $ 43,670,000
Interest rates at
year-end............... 5.7% N/A 5.6%
Daily weighted average
interest rates......... 6.2% 6.3% 4.3%
</TABLE>
4. Accrued liabilities:
<TABLE>
<CAPTION>
August 31,
1996 1995
<S> <C> <C>
Payroll...............................$18,433,250 $13,942,368
Deferred business insurance premiums.. 25,130,170 21,359,234
Taxes other than income taxes......... 15,118,737 13,044,824
Other................................. 7,289,954 3,242,661
$65,972,111 $51,589,087
</TABLE>
<PAGE>
5. Income Taxes
Effective September 1, 1993, the Company adopted Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes"
("SFAS 109"). The cumulative effect as of September 1, 1993, of
adopting SFAS 109 increased net income for the year ended August 31,
1994, by $1,139,153, or $.02 per share. Under SFAS 109, the liability
method is used in accounting for income taxes. Under this method,
deferred tax assets and liabilities are determined based on
differences between financial reporting and tax bases of assets and
liabilities and are measured using the enacted tax rates and laws that
will be in effect when the differences are expected to reverse. Prior
to the adoption of SFAS 109, the Company accounted for deferred income
taxes using the deferred method. Under this method deferred tax
expense was based on items of income and expense that were reported in
different years in the financial statements and tax returns and were
measured at the tax rate in effect in the year the difference
originated.
SFAS 109 requires an asset to be recognized for the anticipated income
tax benefits arising from deductible temporary differences and net
operating loss carryforwards and a valuation allowance, if necessary,
to be established to reduce such assets to the amount which is more
likely than not to be realized. A valuation allowance has been
established for a portion of the benefits of state tax net operating
losses and for a portion of certain other state tax benefits because
the Company currently believes that it is more likely than not that
these benefits will not be realized in future years.
<PAGE>
The components of the Company's deferred income tax liabilities and
assets as of August 31, 1996 and 1995, were as follows:
<TABLE>
<CAPTION>
1996 1995
<S> <C> <C>
Deferred income tax liabilities:
Excess of book over tax valuation of
property and equipment $17,645,325 $18,125,325
Deferred income tax assets:
Excess of tax over book valuation
of inventories $ 6,544,680 $ 4,896,588
Currently nondeductible accruals for:
Business insurance premiums 10,061,492 9,321,724
Deferred incentive compensation 1,257,199 462,124
Vacation pay 1,661,573 1,597,564
Closed store lease liabilities 1,205,450 337,269
State net operating losses 983,000 983,000
Other 8,735 317,480
Gross deferred income tax assets 21,722,129 17,915,749
Valuation allowance for deferred
income tax assets (1,350,000) (1,500,000)
Net deferred income tax assets $20,372,129 $16,415,749
</TABLE>
The provisions for income taxes in each of the three years in the period
ended August 31, 1996, were as follows:
<TABLE>
<CAPTION>
1996 1995 1994
<S> <C> <C> <C>
Current:
Federal.... $37,542,400 $32,595,000 $30,800,327
State...... 5,075,000 5,987,000 6,028,213
42,617,400 38,582,000 36,828,540
Deferred:
Federal... . (4,115,600) (1,852,000) 1,120,535
State.... .. (323,800) (464,000) 208,100
(4,439,400) (2,316,000) 1,328,635
$38,178,000 $36,266,000 $38,157,175
</TABLE>
<PAGE>
The following table summarizes the components of income tax expense
in each of the three years in the period ended August 31, 1996:
<TABLE>
<CAPTION>
1996 1995 1994
% % %
Income tax of pre-tax Income tax of pre-tax Income tax of pre-tax
expense income expense income expense income
<S> <C> <C> <C> <C> <C> <C>
Computed "expected" federal income tax $34,549,635 35.0 $33,031,434 35.0 $35,040,971 35.0
State income taxes, net of federal
income tax benefit........... 3,990,375 4.1 3,771,950 4.0 3,915,700 3.9
Other............................. (362,010) (0.4) (537,384) (0.6) (799,496) (0.8)
Actual income tax expense......... $38,178,000 38.7 $36,266,000 38.4 $38,157,175 38.1
</TABLE>
Noncurrent income taxes payable represents the noncurrent portion of the
additional estimated tax liability arising from the change in accounting method
for income tax purposes for insurance costs and accrued vacation pay.
<PAGE>
6. Employee benefit plans:
Incentive compensation plan:
The Company has an incentive profit-sharing plan whereby, at the
discretion of the Board of Directors, the Company may pay certain
employees and officers an aggregate amount not to exceed 5% of the
Company's consolidated income before income taxes. Expenses under
the profit-sharing plan were $1,355,200 in fiscal 1996, and $0 in
fiscal 1995 and 1994.
Compensation deferral plan:
The Company has a voluntary compensation deferral plan, under
section 401(k) of the Internal Revenue Code, available to eligible
employees. At the discretion of the Board of Directors, the Company
makes contributions to the plan which are allocated to participants,
and in which they become vested, in accordance with formulas and
schedules defined by the plan. Company expenses for contributions
to the plan were $923,352 in fiscal 1996, $901,019 in fiscal 1995,
and $990,491 in fiscal 1994.
7. Commitments and Contingencies:
Operating leases:
Except for its executive offices and primary distribution centers, the
Company generally conducts its operations from leased facilities.
Generally, store real estate leases are for initial terms of from five
to fifteen years with multiple renewal options for additional five
year periods. Certain leases provide for contingent rental payments
based upon a percentage of store sales.
Rental expenses on all operating leases, both cancellable and non-
cancellable, for each of the three years in the period ended
August 31, 1996, were as follows:
<TABLE>
<CAPTION>
1996 1995 1994
<S> <C> <C> <C>
Minimum rentals,
net of minor
sublease rentals....... $67,844,955 $59,826,236 $52,174,423
Contingent rentals....... 1,095,944 929,241 1,050,453
$68,940,899 $60,755,477 $53,224,876
</TABLE>
<PAGE>
Future minimum rental payments required under operating leases that
have initial or remaining non-cancellable lease terms in excess of one
year as of August 31, 1996, were as follows:
<TABLE>
<CAPTION>
Years Ending August 31, Minimum Rental
<C> <C>
1997 $ 63,863,372
1998 54,683,769
1999 41,184,423
2000 27,279,303
2001 14,819,255
Thereafter 23,083,230
$ 224,913,352
</TABLE>
Contingencies:
The Internal Revenue Service has examined the Company's consolidated
1993 and 1994 federal income tax returns and has rendered an initial
report and assessment as a result of the examination. The Company
has appealed the findings of the report. Although the ultimate
outcome of this matter cannot presently be determined, the Company
believes that any impact on its financial statements will not be
material.
8. Employee stock option plan:
The Company's non-qualified stock option plan provides for the
granting of options to key employees to purchase shares of common
stock at prices not less than fair market value on the date of the
grant. Options are exercisable to the extent of 40% after the second
anniversary of the grant, an additional 30% annually on a cumulative
basis, and expire five years from the date of the grant. Options to
purchase 425,265 shares of common stock were exercisable at August 31,
1996.
<PAGE>
<TABLE>
<CAPTION>
Number of
options Option price
outstanding per share
<S> <C> <C>
Common stock options, September 1, 1994.. 951,290 $ 5.13-21.25
Granted............................ 422,850 10.25-18.50
Exercised.......................... (157,590) 5.13-17.25
Cancelled.......................... (101,590)
Common stock options, August 31, 1995... 1,114,960 5.88-21.25
Granted.............................. 90,350 11.50-18.75
Exercised............................ (94,020) 5.88-17.25
Cancelled............................ (108,990)
Common stock options, August 31, 1996.... 1,002,300 $10.25-21.25
At August 31, 1996, there were 589,790 shares available for option
under the plan, and 571,150 shares were available for option at
August 31, 1995.
</TABLE>
The Financial Accounting Standards Board has issued Statement of
Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation"("SFAS 123") effective for fiscal years that begin after
December 15, 1995. SFAS 123 governs accounting for employee stock
options or similar equity instruments and related compensation
expense, and allows entities to adopt a new "fair value" method to
measure compensation or, alternatively, to continue using the method
prescribed by Accounting Principles Board Opinion No. 25 ("APB 25"),
the former standard. SFAS 123 requires supplemental disclosure of the
effects of the new method if the former method continues to be
utilized. The Company intends to continue using the method prescribed
by APB 25, and, accordingly, the adoption of SFAS 123 in fiscal 1997
should not affect the Company's financial position or results of
operations.
9. Earnings per common share:
Earnings per common share is based on the weighted average number of
shares of common stock outstanding during each year. Potential
exercise of outstanding stock options do not have a material dilutive
effect on earnings per common share.
<PAGE>
10. Unaudited summaries of quarterly results:
<TABLE>
<CAPTION>
First Second Third Fourth
Quarter Quarter Quarter Quarter
(In thousands, except per share data)
<S> <C> <C> <C> <C>
1996
Net sales............ $396,165 $448,274 $427,941 $442,247
Gross profit......... 137,211 139,965 144,010 137,247
Net income........... 14,508 15,937 18,780 11,363
Net income per
common share.. $.26 $.28 $.33 $.20
1995
Net sales.............. $356,292 $420,927 $379,836 $389,839
Gross profit........... 127,351 132,468 131,259 122,747
Net income............. 15,586 17,040 16,405 9,078
Net income per
common share......... $.28 $.30 $.29 $.16
1994
Net sales....... $335,092 $398,768 $349,211 $345,369
Gross profit.... 125,948 136,592 131,554 112,160
Income before cumulative
effect of accounting change $ 14,950 22,021 17,570 7,419
Net income.... 16,089 22,021 17,570 7,419
Earnings per common share:
Income before cumulative
effect of accounting change $.27 $.39 $.31 $.13
Net income............ $.29 $.39 $.31 $.13
</TABLE>
<TABLE>
<CAPTION>
FAMILY DOLLAR STORES, INC. & SUBSIDIARIES 8/31/96
-----------------------------------------
CORP. NO. NAME ADDRESS CITY STATE ZIP F.E.I. NO.
--------- --------------------------- -------------- --------- ----- ----- ----------
<S> <C> <C> <C> <C> <C>
FAMILY DOLLAR STORES
1 OF SANDERSVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1109922
2 OF NORTH CAROLINA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0693934
7 OF SANFORD, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0854677
8 OF WILMINGTON, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0752043
10 INC. OF S. C. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0766390
11 OF MARTINSVILLE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-0791244
12 OF ROCK HILL, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0774313
14 OF GAINESVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 58-1048442
15 OF GASTONIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0791813
22 OF ROANOKE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-0799404
26 OF HARRISONBURG, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1098343
31 OF AIRPORT CROSSROADS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0481964
32 OF TRAVELERS REST S.C. INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0484805
35 OF WINSTON-SALEM, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0891786
36 OF GEORGIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0754858
37 OF AUGUSTA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 58-1020583
39 OF THOMASVILLE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0903183
40 OF MECKLENBURG COUNTY INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0903810
42 OF HIGH POINT, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0927281
43 OF HENRY COUNTY INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0905499
45 OF EASLEY, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0511859
46 OF GAFFNEY, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0514835
47 OF LAURENS, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0516407
48 OF CHESTER, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0934964
49 OF NEWBERRY, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0516825
53 OF BUENA VISTA, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-0854189
60 OF WEST COLUMBIA, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0521348
62 OF OCEAN DRIVE, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0522185
65 OF BENNETTSVILLE, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0523895
66 OF JAMES ISLAND, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0950032
68 OF CUMBERLAND COUNTY, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0949450
69 OF SMITHFIELD, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0950033
73 OF UNION, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0524425
76 OF BRISTOL, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1193158
77 OF ABBEVILLE, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0525224
78 OF GALAX, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-0882766
79 INC. (MISSISSIPPI) P.O. BOX 1017 CHARLOTTE NC 28201-1017 64-0470226
80 OF MARION, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952811
81 OF SPARTANBURG, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952153
83 OF GREENWOOD, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952150
86 OF HURT, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0955749
88 OF CONWAY, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0955750
89 OF PONTOTOC, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1327478
90 OF COMMERCE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0963516
91 OF ANDERSON, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0963457
93 OF ALBEMARLE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0964262
99 OF INMAN, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0986749
101 OF LANCASTER COUNTY, S.C.,INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0987295
102 OF CAMDEN, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0987294
103 OF ATHENS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0989677
<PAGE>
<S> <C> <C> <C> <C> <C>
105 OF WINDER, GA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1024571
107 OF TOCCOA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0990185
111 OF SENECA, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0862849
112 OF SUMTER, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0990635
115 OF WOODRUFF, S.C. INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0990636
116 OF ASHEVILLE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992565
117 OF CHATSWORTH, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 58-0978660
119 OF CHERAW, S.C. INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0996222
121 OF PELZER, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0996223
124 OF BATESBURG, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1014267
125 OF DILLON, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0545233
126 OF RICHMOND, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992564
127 OF HARTSVILLE, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1007333
128 OF CHASE CITY, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1013307
130 OF GREENVILLE, S.C., INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1007385
131 OF ORANGEBURG, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1007387
132 OF FLORENCE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0471484
135 OF DARLINGTON, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1014266
136 OF WALTERBORO, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1014749
137 OF SOUTH BOSTON, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1013306
138 OF MULLINS, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1013308
147 OF PICKENS, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1019398
149 OF GREER, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-0876986
152 OF ANDREWS, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1024810
154 OF LAWRENCEVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1023884
156 OF LAKE CITY, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1025274
158 OF ELBERTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1024553
159 OF YORK, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1026926
160 OF THOMSON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1024316
162 OF PENDLETON, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0550909
165 OF PERRY,GA.INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1124535
167 OF CHARLESTON, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952148
168 OF GOOSE CREEK, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952149
170 OF MARTINEZ, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1033166
174 OF NORTH AUGUSTA, S.C. INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1023083
175 OF EMPORIA, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1044478
176 OF CHESAPEAKE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1042853
178 OF SUMMERVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1157531
179 OF LOUISA, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1038749
183 OF SWAINSBORO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1054983
186 OF RADFORD, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1048961
187 OF MANNING, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1161760
189 OF HAMPTON, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1141002
193 OF GEORGETOWN, SC. INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0565302
194 OF AIKEN, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1056848
195 OF MCDONOUGH GA INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1057216
199 OF MADISON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1065440
200 OF MILLEDGEVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1058472
208 OF WINNSBORO, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1068417
209 OF MONROE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1068416
211 OF MONCKS CORNER, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1068415
212 OF KINGSTREE, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1068419
214 OF HARTWELL, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072523
215 OF DOUGLAS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072513
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216 OF EASTMAN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072512
218 OF FITZGERALD, GA.,INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072515
219 OF CORNELIA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1010175
222 OF PORTSMOUTH, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-0984373
223 OF BLUE RIDGE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1097105
224 OF NEWTON COUNTY GA INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1109917
226 OF SYLVANIA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-0959580
227 OF MACON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1118791
228 OF WARNER ROBINS,GA.,INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952152
229 OF CARROLLTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1119905
230 OF CARTERSVILLE,GA.,INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1119906
231 OF ATLANTA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1120343
234 OF CLINTON, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0526909
236 OF AMERICUS GA INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1127675
237 OF SMYRNA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1226226
240 OF WASHINGTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1161755
241 OF VIDALIA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1134237
244 OF HENDERSON INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1138200
246 OF FORT VALLEY GA INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1129286
248 OF BARNWELL, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1145736
252 OF MT. PLEASANT, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952151
255 OF DENMARK, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1153152
258 OF RIVERDALE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1153153
261 OF CLINTON, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1064359
262 OF BEAUFORT, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1162735
263 OF ROSSVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1161763
265 OF CORDELE, GA., INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1165546
267 OF GRIFFIN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1165543
268 OF CHESTER, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1032440
270 OF JONESBORO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1168141
272 OF FORT MILL, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1169116
274 OF MARION, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1171732
276 OF CEDARTOWN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072514
277 OF BARNESVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1171725
278 OF HOPEWELL, VA. INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1173213
279 OF ALBANY, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1172385
282 OF PULASKI, VA., INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1175330
283 OF ROME, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1175344
285 OF SALEM, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1175329
286 OF OAK HILL, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1177991
287 OF SURFSIDE BEACH, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1177990
289 OF DUBLIN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1177989
290 OF CALHOUN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1180596
297 OF SMITHFIELD, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1062596
299 OF ORANGE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1076698
302 OF COVINGTON, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1193159
305 OF BECKLEY, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0580827
313 OF JACKSON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1198043
315 OF SAVANNAH, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1208417
316 OF CHRISTIANSBURG, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1198411
318 OF NEWNAN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1073013
319 OF SIMPSONVILLE, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1030443
321 OF PRINCETON, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0583278
322 OF COCHRAN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1030842
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324 OF THOMASTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1203988
325 OF WYTHEVILLE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1080403
326 OF BEDFORD, VA.,INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1208169
327 OF LYNCHBURG, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1080407
329 OF CLIFTON FORGE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1081404
331 OF ADEL, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1208235
332 OF MOULTRIE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1208239
333 OF COLUMBUS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1208230
335 OF SUFFOLK, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1216327
336 OF FARMVILLE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1216328
338 OF NORFOLK, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1212850
340 OF SUMMERVILLE, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1263366
341 OF ROCKY MOUNT, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1091171
343 OF STAUNTON, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1092451
345 OF DANVILLE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1221527
346 OF SOUTH HILL, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1221487
348 OF CAMILLA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1222247
349 OF QUITMAN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1222249
350 OF DOUGLASVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1051998
351 OF BAXLEY, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1051996
357 OF TAZEWELL, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1239650
358 OF HAWKINSVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1239375
360 OF SPRING LAKE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1240992
362 OF LAFAYETTE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1240352
363 OF MARIETTA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1131260
364 OF MABLETON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1067993
365 OF HAZLEHURST, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1067994
371 OF BLUEFIELD, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0596897
376 OF DUBLIN, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1254668
379 OF WAYNESBORO, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1301548
380 OF HARRISVILLE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1333358
381 OF HINESVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1270823
383 OF STATESBORO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1327882
384 OF TIFTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1085175
385 OF CLAXTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1270821
389 OF DANVILLE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0604584
394 OF OCEAN SPRINGS, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1278645
397 OF FOREST PARK, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1281082
405 OF SYLACAUGA, ALA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1234185
415 OF TARRANT, ALA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1234186
420 OF VALDOSTA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1232663
421 OF ELLIJAY, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1232660
422 OF CAIRO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1232661
423 OF ROYSTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1232659
424 OF CUTHBERT, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1232664
442 OF MONTEZUMA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1285497
443 OF ASHLAND, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1151354
444 OF HAMPTON, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1282880
446 OF SUMMERSVILLE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0606794
448 OF MANCHESTER, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1285001
449 OF DOTHAN, ALA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1285002
453 OF DULUTH, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1101171
454 INC. KENTUCKY P.O. BOX 1017 CHARLOTTE NC 28201-1017 38-1875634
456 OF RUSSELL SPRINGS, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1293634
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460 OF WEST VIRGINIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992562
464 OF RAINELLE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1296336
469 OF ELKVIEW, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0610938
470 OF LITHONIA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1105736
476 OF ELKTON, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1113296
480 OF SPRINGFIELD, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1304661
481 OF VICTORIA, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1174498
482 OF TULLAHOMA, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1304568
483 OF WISE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1171385
484 OF BEATTYVILLE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1360046
485 OF MAN, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1304664
492 OF VILLA RICA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1306477
493 OF REIDSVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1307066
495 OF ESCATAWPA, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1308467
496 OF HARRODSBURG, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-0992945
497 OF COLUMBIA, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0426310
498 OF FRANKFORT, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-0994177
499 OF FAIRBURN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1117372
500 OF BRUNSWICK, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1315108
502 OF LOGAN, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0614710
504 OF WRENS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1311420
505 OF PENNINGTON GAP, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1179890
506 OF LAWRENCEBURG, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1312236
507 OF GREENSBORO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1311609
508 OF ST. ALBANS, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0618158
509 OF HINTON, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0614711
513 OF CYNTHIANA, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1313384
517 OF NEWPORT NEWS, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1182090
518 OF ST. GEORGE, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1313974
520 OF AMORY, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1313382
521 OF WESTMINSTER, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1145912
522 OF NINETY SIX, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1129271
523 OF TUPELO, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1315110
524 OF RICHLANDS, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1185784
526 OF GORDON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1117373
530 OF CUMBERLAND, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-0997242
532 OF GLASGOW, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-0998465
535 OF ALABAMA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1319884
538 OF GRUNDY, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1199397
539 OF WATER VALLEY, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1129602
540 OF OXFORD, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1129865
542 OF FRANKLIN, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1325016
545 OF DREW, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1327479
546 OF LELAND, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1327486
547 OF GREENVILLE, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1327483
548 OF RIPLEY, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1332569
549 OF MARLINTON, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1332766
553 OF LOUISVILLE, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1333005
558 OF CUMMING, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1136722
559 OF JACKSON, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337230
560 OF STANFORD, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1335589
563 OF PHILIPPI, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0621212
564 OF FOLKSTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1334690
565 OF STARKVILLE, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1336091
566 OF QUITMAN, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1336088
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570 OF NEW MARTINSVILLE,W.VA.,INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1338091
571 OF JENA, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1339389
572 OF WESTON, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337988
573 OF ST. MARYS, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337987
574 OF MANCHESTER, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337181
577 OF SPENCER, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0621230
578 OF KINGWOOD, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337985
579 OF HAZLEHURST, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1339558
580 OF ABERDEEN, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1338003
581 OF LAVONIA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337229
582 OF RIPLEY, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1338000
583 OF MT. WASHINGTON, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-1009284
584 OF NATCHEZ, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1338905
585 OR ST. MARYS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1339387
586 OF FAYETTE, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1141805
587 OF STANTON, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-1010702
591 OF BOGALUSA, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1342397
595 OF WESTERNPORT, MD., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1343528
599 OF ARKANSAS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 71-0404928
601 OF DEWITT, ARK., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1343529
602 OF MCGEHEE, ARK., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1343356
603 OF CROSSLANES, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1343531
605 OF INEZ, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1347247
606 OF LEITCHFIELD, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1345063
607 OF BAY ST. LOUIS, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1345204
608 OF CANTON, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1346025
609 OF MCKENZIE, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1347234
612 OF CUMBERLAND, MD., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1346665
613 OF HUNTINGDON, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1147033
614 OF FLORIDA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1147034
617 OF BISHOPVILLE, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1349049
618 OF CARTHAGE, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1347757
620 OF LAGRANGE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1349048
629 OF DAWSON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072522
632 OF HOLLY SPRINGS, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1353786
633 OF TRENTON, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1355533
636 OF RICHMOND, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1360064
637 OF KENNESAW, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1065602
643 OF SALYERSVILLE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1358576
644 OF MARION, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1358577
649 OF LAKE PROVIDENCE, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1360667
651 OF CAMPBELLSVILLE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1362565
652 OF RUSSELLVILLE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1362567
655 OF NATCHITOCHES, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1363368
658 OF LEXINGTON, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1366205
669 OF MARYLAND, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1179942
670 OF VIDALIA, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373351
671 OF LOUISA, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1369714
672 OF ABBEVILLE, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373359
680 OF GREENUP, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373358
683 OF SPARTA, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1114317
685 OF IRVINE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373356
687 OF GLENVILLE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373354
688 OF FRANKLINTON, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373353
691 OF HUNTINGTON, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1375590
<PAGE>
<S> <C> <C> <C> <C> <C>
692 OF HURRICANE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1375591
694 OF WAYCROSS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1375097
699 0F MEMPHIS, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1375593
701 OF VANCEBURG, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1376394
703 OF GREENWOOD, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1377739
704 OF BROOKHAVEN, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1377743
706 OF PINEVILLE, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1378199
707 OF BUNKIE, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1378191
708 OF LITTLE ROCK, ARK., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1378196
710 OF MONTICELLO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1377738
715 OF PARKERSBURG, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1378192
717 OF TALLULAH, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1379165
719 OF PENNSYLVANIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992563
732 OF STUART, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1382716
733 OF BOONEVILLE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1383058
744 OF OHIO, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0991921
801 OF MAULDIN, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0959395
802 OF CONYERS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1065751
809 OF COVINGTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1051675
810 OF DELAWARE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1416308
844 OF NO. PENNSYLVANIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56=1426757
880 OF ARIZONA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1355530
882 OF WISCONSIN, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1356720
884 OF CALIFORNIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0993176
886 OF ILLINOIS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0993516
887 OF INDIANA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0991922
888 OF KANSAS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992164
889 OF NEVADA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1355536
890 OF NEW JERSEY, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1400170
891 OF MASSACHUSETTS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992166
892 OF MICHIGAN, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0991920
893 OF MINNESOTA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1400173
894 OF MISSOURI, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0991923
895 OF NEW YORK, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992165
897 OF OKLAHOMA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992157
898 OF TEXAS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1389401
899 OF WYOMING, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1355538
1420 OF CONNECTICUT, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1587368
1423 OF COLORADO, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1587711
1424 OF IOWA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1587713
1425 OF NEBRASKA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1587714
1426 OF SOUTH DAKOTA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1587710
1613 OF VERMONT, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1633089
1620 OF NEW MEXICO, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1633088
1665 OF D. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1441925
1881 OF NEW HAMPSHIRE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1435306
1883 OF NORTH DAKOTA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1435307
2019 OF MAINE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1763454
2020 OF RHODE ISLAND, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1763455
9100 FAMILY DOLLAR SERVICES, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1744955
9200 FAMILY DOLLAR OPERATIONS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1747881
9300 FAMILY DOLLAR TRUCKING, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1747883
9400 FAMILY DOLLAR MARKETING, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1911976
9990 INC. (DELAWARE) P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0942963
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS OF FAMILY DOLLAR STORES, INC. AND
SUBSIDIARIES FOR THE FISCAL YEAR ENDED AUGUST 31, 1996, AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000034408
<NAME> FAMILY DOLLAR STORES, INC.
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1996
<PERIOD-START> SEP-01-1995
<PERIOD-END> AUG-31-1996
<EXCHANGE-RATE> 1
<CASH> 18,844,839
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 462,840,051
<CURRENT-ASSETS> 507,899,972
<PP&E> 309,132,314
<DEPRECIATION> 124,525,085
<TOTAL-ASSETS> 696,808,291
<CURRENT-LIABILITIES> 234,205,847
<BONDS> 0
0
0
<COMMON> 6,029,068
<OTHER-SE> 438,928,051
<TOTAL-LIABILITY-AND-EQUITY> 696,808,291
<SALES> 1,714,627,092
<TOTAL-REVENUES> 1,714,627,092
<CGS> 1,156,194,732
<TOTAL-COSTS> 1,615,861,346
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 98,765,746
<INCOME-TAX> 38,178,000
<INCOME-CONTINUING> 60,587,746
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 60,587,746
<EPS-PRIMARY> 1.07
<EPS-DILUTED> 1.07
</TABLE>
AMENDMENT NO. ONE
TO THE
FAMILY DOLLAR EMPLOYEE SAVINGS AND RETIREMENT PLAN AND TRUST
AS AMENDED AND RESTATED JANUARY 1, 1987
THIS AMENDMENT, made and executed the 15th day of January, 1996, by
Family Dollar Stores, Inc. and its related corporations as listed on the
attached Exhibit A which have joined as participating employers under this
Plan (collectively, the "Employer") and George R. Mahoney, Jr., C. Martin
Sowers and John D. Reier (collectively, the "Trustee");
WITNESSETH;
A. The Employer has entered into the Family Dollar Employee Savings
and Retirement Plan (the "Plan") for the benefit of eligible employees and has
reserved the right to amend the same from time to time.
B. The Employer desires to amend the Plan in the manner hereinafter
set forth, as a condition of the Internal Revenue Service favorable
determination letter.
THEREFORE, the Plan is amended as follows:
1. Section 4.4(a)(2)(iii) of the Plan shall be amended to read as
follows:
"(iii) In addition to or as an alternative to the
foregoing, the Committee may in its discretion require that
Participants who are Highly Compensated Employees be
required to amend their Salary Deferral Contributions
percentage elections and/or to receive as a cash
distribution under Code Section 401(k)(8) Excess Deferrals
already contributed to the Plan with respect to the Plan
Year, plus any Income attributable thereto (computed in
accordance with the Trustee's usual procedures for
allocating Income to Participant's accounts); provided that
the foregoing alternative of cash election shall not be
available for Plan Years beginning prior to January 1, 1987.
If any Salary Deferral Contributions are distributed
pursuant to this Section, any Matching Contributions
allocated to the Participant's Employer Contribution Account
by reference to those Salary Deferral Contributions also
must be distributed (if such Matching Contributions are
vested) as required to comply with Section 401(a) of the
Commissioner's regulations. In all events, the Committee's
determination as to which Participants will be affected
under this subparagraph (iii) shall be determined by
reducing the deferrals of Participants who are Highly
Compensated Employees in order of their Actual Deferral
Percentages, beginning with the highest such percentage
during that Plan Year; provided, that Excess Deferrals
attributable to Family Members who are subject to the family
member aggregation rules of Section 1.401(k)-1(g)(1)(ii)(C)
<PAGE>
of the Commissioner's regulations shall be allocated among
the Family Members in proportion to the Salary Deferral
Contributions (and amounts treated as Salary Deferral
Contributions) of each Family Member that are combined to
determine the Actual Deferral Percentages. Any cash
distributions under the foregoing sentence shall be treated
as if they had never been deferred to the Plan under Section
4.3."
2. Section 4.4(b)(2) of the Plan shall be amended to read as
follows:
"(2) In the event that neither test in Subsection (4) is
met as of the last day of any Plan Year:
(i) The Committee shall request that the Employer
make an additional Matching Contribution to the Plan, which
contribution shall be allocated among Employer Contribution
Accounts as an additional Matching Contribution allocated based
upon some stated amount of Salary Deferral Contributions either
among all Participants or just among those Participants who are
Non-Highly Compensated Employees. Any amount contributed pursuant
to this subparagraph (i) shall be a new Matching Contribution, and
no amount previously contributed to the Plan as a Salary Deferral
Contribution or as a qualified non-elective contribution as
described in Secion 1.401(m)-1(b)(5) of the Commissioner's
regulations may be redesignated as a Matching Contribution under
this subparagraph.
(ii) In addition to or as an alternative to the
foregoing, the Committee may, in its discretion, require that
Participants who are Highly Compensated Employees be required to
receive as a cash distribution under Code Section 401(m)(6) any
Excess Contributions of vested Matching Contributions already
contributed to the Plan with respect to the Plan Year, plus any
Income attributable thereto (computed in accordance with the
Trustee's usual procedures for allocating Income to Participant's
accounts). In all events, the Committee's determination as to
which Participants will be affected shall be determined under this
subparagraph (ii) by reducing the Matching Contributions by or on
behalf of Participants who are Highly Compensated Employees in
order of their Actual Contribution Percentages, beginning with the
highest such percentage during that Plan Year; provided, that
Excess Contributions attributable to Family Members who are
subject to the family member aggregation rules of Section
1.401(m)-1(f)(1)(ii)(C) of the Commissioner's regulations shall be
allocated among the Family Members in proportion to the Matching
Contributions (and amounts treated as Matching Contributions) of
each Family Member that are combined to determine the Actual
Contribution Percentages. Any cash distributions under the
<PAGE>
foregoing sentence shall be treated as if they had never been
contributed to the Plan under Section 4.1.
(iii) In addition to or as an alternative to the
foregoing, the Committee may require that non-vested Matching
Contributions be forfeited to correct Excess Contributions."
3. The foregoing Amendments shall be effective as of the
Plan's Effective Date, which is January 1, 1987.
IN WITNESS WHEREOF, the Employer has caused the Amendment to be properly
executed on the 15th day of January, 1996.
FAMILY DOLLAR STORES, INC., and all
other Employers listed on the
attached Exhibit A ("Employer")
(Corporate Seal)
JOHN D. REIER
By: JOHN D. REIER
Title: President
Attest:
JANICE B. BURRIS
By: JANICE B. BURRIS
Title: Assistant Secretary
GEORGE R. MAHONEY, JR. (SEAL)
GEORGE R. MAHONEY, JR., Trustee
C. MARTIN SOWERS (SEAL)
C. MARTIN SOWERS, Trustee
JOHN D. REIER (SEAL)
JOHN D. REIER, Trustee
STATE OF NORTH CAROLINA
EMPLOYMENT AGREEMENT
COUNTY OF MECKLENBURG
THIS AGREEMENT, made and entered into effective the 1st day of September
1996, by and between FAMILY DOLLAR STORES, INC., a Delaware corporation
(hereinafter referred to as the "Company"); and John D. Reier (hereinafter
referred to as the "Employee");
W I T N E S S E T H:
WHEREAS, the Company desires to employ the Employee and the Employee
desires to be employed by the Company;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the Company and the Employee agree as follows:
1. DEFINITIONS. When used in this Agreement, these words shall be
defined as follows:
1.01 "Affiliate" - Any corporation directly or indirectly
controlling, controlled by or under the common control of or with the Company.
1.02. "Group" - The Company and all Affiliates.
1.03. "Confidential Information" - Any information (including,
without limitation, any method of operation, source of supply, organizational
details, personnel information, information regarding real estate activities,
including landlords, prospective landlords and lease data, business secret, or
any formula, pattern, patent, device, plan, process or compilation of
information) which (a) is, or is designed to be, used in the business of any
member of the Group, (b) is private or confidential in that it is not
generally known or available to the public, and (c) gives any member of the
Group an opportunity to obtain an advantage over competitors who do not know
or use it.
1.04. "Present Territory" - All counties, towns and cities in
North Carolina, Virginia, Georgia, South Carolina, West Virginia, Maryland,
Pennsylvania, Kentucky, Tennessee, Mississippi, Alabama, Florida, Louisiana,
Arkansas, Ohio, Texas, Delaware, Indiana, New Jersey, Missouri, Oklahoma,
Illinois, Michigan, Kansas, Iowa, New York, Wisconsin, Massachusetts,
Connecticut, Rhode Island, Vermont, New Hampshire, Minnesota, Nebraska, New
Mexico and Maine.
1.05. "Future Territory" - All counties, towns and cities in
States other than those listed in the definition of Present Territory in which
the Company does business while the Employee is employed by the Company.
1.06. "Competitive Company" - A corporation, partnership,
proprietorship or any other legal entity operating discount retail stores in
the Present Territory or the Future Territory, the majority of which stores
<PAGE>
each have 50,000 square feet or less of total space, including non-selling
areas, and that sell or offer for sale merchandise similar or identical to the
merchandise sold by the Group.
1.07. "Cause" -
(a) Willful failure of the Employee to comply with
reasonable written directives of the Chairman of the Board or Executive
Committee or Board of Directors of the Company.
(b) Chronic absenteeism not resulting from Medical
Disability.
(c) Willful misconduct or gross negligence.
(d) Willful violation of substantive Company policies,
practices or procedures.
(e) Indictment of or conviction of the Employee of a crime
involving an act of moral turpitude.
(f) Should the Employee become an alcoholic or become
addicted to habit-forming drugs.
1.08. "Medical Disability" - An illness or medical condition
preventing the Employee from being able to actively and regularly perform his
duties and responsibilities under this Agreement for period of ninety (90)
work days or longer during any fiscal year of the Company.
2. EMPLOYMENT. The Employee shall be employed by the Company and any
Affiliate in the capacity provided for in Paragraph 3 for the period com-
mencing September 1, 1996, (the "Commencement Date"), and ending on August 31,
1997, or upon the termination of this Agreement as provided in Paragraph 6.
3. DUTIES AND RESPONSIBILITIES. The Employee shall be employed as
President and Chief Operating Officer of the Company and shall perform such
reasonable duties and responsibilities as the Chairman of the Board of the
Company or Board of Directors of the Company or the Executive Committee of the
Board of Directors of the Company may, from time to time, assign to the
Employee. The Employee agrees to accept this employment and to devote his
full time and attention and his best efforts, ability and fidelity to the
performance of the duties attaching to such employment. In addition, the
Employee shall serve as a director and officer of the Company and any
corporation in the Group, if appropriately elected. During the period of his
employment, the Employee shall not, for remuneration or profit, directly or
indirectly, render any service to, or undertake any employment for, any other
person, firm or corporation, whether in an advisory or consulting capacity or
otherwise, without first obtaining the written consent of the Company.
4. COVENANT NOT TO COMPETE AND DISCLOSE CONFIDENTIAL INFORMATION.
4.01. The Employee will not, directly or indirectly, for a period
of one (1) year from the date of the termination of his employment with the
Company, whether such termination is voluntary or involuntary or due to the
expiration of the term of this Agreement, (a) engage in competition with the
Company, any Affiliates, or their successors or assigns, for or on behalf of
<PAGE>
any Competitive Company, or (b) provide information to, or travel, canvass,
advertise, solicit or sell for, or acquire an interest in, become employed by,
act as agent for, or in any manner assist, any Competitive Company; provided
that the Employee may become employed by or act as agent or consultant for, in
any capacity, a Competitive Company when his duties and responsibilities with
the Competitive Company do not, directly or indirectly, involve any business
activity in the Present Territory or the FutureTerritory; or (c) directly or
indirectly approach, solicit, offer employment to or in any manner induce or
seek to induce any employee of the Group to become employed by a Competitive
Company or to otherwise interfere with the Company's relationship with any
employee in the Group.
The foregoing provisions, however, shall not prohibit the
Employee from making investments in any securities listed on the New York or
American Stock Exchanges or actively traded in the over-the-counter market in
amounts not exceeding 1% of any single class of such securities outstanding,
nor prohibit the Employee from making investments of any nature in any
securities of the Company.
4.02. The Employee acknowledges that the signing of this Agreement
is a condition of employment and understands that in the performance of his
services hereunder, he may have access to and obtain knowledge of Confidential
Information (as hereinbefore defined) relating to the business and activities
of the Group. The Employee shall not, without the written consent of the
Company, either during the period of his employment or thereafter (a) use or
disclose any Confidential Information outside the Group, (b) publish any
article with respect thereto, or (c) except in the performance of his services
hereunder, remove or aid in the removal from the premises of the members of
the Group any such Confidential Information or any property or material which
relates thereto.
5. COMPENSATION.
5.01. In consideration of the services to be rendered by the
Employee pursuant to this Agreement, the Company shall pay, or cause to be
paid, to the Employee a weekly base salary from the Commencement Date to
August 31, 1997 of $6,250.00 ($325,000.00 per annum).
The salary shall be payable at such intervals in conformity
with the Company's prevailing practice as such practice shall be established
or modified from time to time.
5.02. In addition, the Employee shall be entitled to:
(a) Participate in the Company's Target Bonus Plan, as it
may be amended or modified in any respect, including achievement of
established goals, as President, for the fiscal year commencing September 1,
1996. The Target Bonus Plan generally will give the Employee the opportunity
to earn a bonus of up to fifty (50%) percent of the Employee's base salary
actually received for said fiscal year, subject to the Company's achievement
of certain financial goals to be established, the Employee's performance, and
all terms and conditions of the Target Bonus Plan as in effect for said fiscal
year; provided that the amount of bonus paid may not be increased by the
annual individual performance rating of the Employee by the Chairman of the
<PAGE>
Board. The Employee acknowledges that he has received a copy of the form of
the Target Bonus Plan and Bonus Conditions for prior years and is familiar
with the terms and conditions thereof. Nothing contained herein shall limit
the Company's right to alter, amend or terminate the Target Bonus Plan at any
time for any reason. The Employee further acknowledges that, as provided in
the Target Bonus Plan, in the event the Employee is not employed by the
Company, for whatever reason, at the time the bonus for the fiscal year is
customarily paid in December or January following the end of the fiscal year,
the Employee will not be entitled to receive the bonus.
(b) Take fifteen days (exclusive of Saturdays, Sundays and
paid Company holidays) of vacation during the twelve month period commencing
May 1, 1996. Vacation time already taken since May 1, 1996, will be charged
against the fifteen days due for the year commencing May 1, 1996. Vacation
time cannot be accumulated from year to year. For the period from May 1,
1997, through the end of the term of this Agreement on August 31, 1997, five
days of vacation may be taken.
(c) Additional benefits and/or compensation in such form
and in such manner and at such times as the Board of Directors of the Company,
in the exercise of its absolute discretion, shall determine. It is understood
and agreed that any additional salary, benefits and compensation shall only be
paid by the Company upon the approval of the Board of Directors and not by any
officer or any other person acting on behalf of the Company.
(d) All insurance and other fringe benefits afforded to the
Company employees pursuant to any plan adopted by the Company in accordance
with the terms of the plan and his position in the Company.
6. TERMINATION.
6.01. It is agreed that either party may terminate this Agreement
for any reason at any time upon three (3) days' prior written notice to the
other party, whereupon (except as provided in Paragraph 4), this Agreement
shall no longer be of any force and effect (the expiration date of this notice
period is herein called the "Termination Date"). If either party terminates
this Agreement, the Company may relieve the Employee of all duties and
responsibilities effective on the date of the notice. The Company may also
terminate this Agreement should the Employee experience a Medical Disability,
which termination shall be effective upon the Company's giving written notice
to the Employee following the expiration of the Medical Disability period.
Upon the death of the Employee, the Company shall pay to his widow or his
estate if his widow predeceases him only such amount as was due and payable to
the Employee at the time of his death. The Company may terminate this
Agreement at any time, without notice, for Cause.
6.02. Upon termination of this Agreement by the Company, other
than for Cause, except for the provisions of Paragraph 4, the Employee's
employment under the terms of this Agreement and all other agreements and
contracts between the Employee, the Company and the Company's Affiliate and
subsidiary corporations, shall be terminated effective on the Termination
Date. Should the Company terminate this Agreement prior to the end of the
term of this Agreement, for reasons other than for Cause or Medical
Disability, it shall pay to the Employee, sixty (60) days of the base salary
<PAGE>
set forth in Paragraph 5.01 above in effect on the date of the notice (which
shall constitute payment in full of the compensation due to the Employee
hereunder). Any such payments shall be made in two (2) equal monthly
installments with the first such installment due and payable not later than
thirty (30) days after the Termination Date. Such payments made by the
Company to the Employee are herein called "Termination Compensation." In the
event the Employee accepts or begins other employment as an employee,
consultant or in any other capacity prior to the date on which the second
monthly installment of Termination Compensation is due and payable, the
monthly payments of any unpaid balance of the Termination Compensation as of
the date of such new employment shall be (i) eliminated if the monthly base
salary and all other monthly remuneration and compensation from the new
employment exceeds the monthly base salary of the Employee in effect on the
date of the notice, or (ii) reduced to the amount by which the monthly base
salary of the Employee in effect on the date of the notice exceeds the monthly
base salary and all other monthly remuneration and compensation from the new
employment. The Employee agrees to pursue reasonable, good faith efforts to
obtain other employment in a position suitable to his background and
experience.
6.03. On the Termination Date and at the end of the term of this
Agreement, the Employee agrees that the Company, its Affiliates, and their
officers, directors, members of the Executive Committee, and employees, and
their successors, heirs and assigns, shall be fully released and discharged
from any and all expenses, claims, considerations, liabilities, obligations
and causes of action of every kind and nature arising out of or in any manner
related to this Agreement, and any and all previous agreements, contracts and
other rights, claims and obligations between the parties, to the Employee's
employment with the Company, its Affiliate and subsidiary corporations, and to
the Employee's association or relationship with the Company and its
Affiliates, including but not limited to, all compensations, salaries, bonuses
(including Target Bonus Plan bonuses and guarantees of bonuses thereunder),
director's pay, vacation pay, stock options, stockholder's claims or suits,
loans and other similar liabilities or related claims; provided, that nothing
herein contained shall qualify or in any manner restrict the right of the
Employee to realize his Termination Compensation, if any, and his interests in
any of the fringe benefits (such as insurance, 401(k) plan and stock options)
of the Company to which he has become legally entitled.
6.04. On the Termination Date or at the end of the term of this
Agreement, the Employee agrees that he will resign as an officer, director and
member of the Executive Committee of the Company, its Affiliate and subsidiary
corporations (if and when elected), and from any other positions, which
resignations shall become effective on the Termination Date.
6.05. After the Termination Date or the end of the term of this
Agreement, the Employee covenants to render further advice and assistance to
the Company as may be required from time to time, and to provide all
information available to him on matters handled by and through him while
employed by the Company or of which he has personal knowledge, and by making
available to the Company at reasonable times and circumstances, upon request
<PAGE>
by the Company, information pertinent to its operations in his possession;
and, to the extent that it is necessary, to cooperate with and assist the
Company to conclude any matters that are pending and which may require his
assistance; provided, that he shall be paid reasonable compensation by the
Company in the event he is required to expend time in the performance of such
services; and provided further, that the Employee may perform such services in
a manner that does not unreasonably interfere with other employment obtained
by the Employee. The Employee shall be reimbursed for any expenses incurred
by him in the performance of the covenants herein set forth in this Section
6.05.
6.06. After the Termination Date or the end of the term of this
Agreement, the Employee agrees that he will not discuss his employment and
resignation or termination or Termination Compensation, if any, with any
representatives of the media, either directly or indirectly, without the
written consent and approval of the Company.
7. SPECIAL PROVISIONS. This Agreement shall inure to the benefit of
any successor to or assignee of the Company, and the Employee specifically
agrees on demand to execute any and all necessary documents in connection with
the performance of this Agreement. No waiver by either party of any breach by
the other of any provision hereof shall be deemed to be a waiver of any later
or other breach thereof or as a waiver of any such or other provision of this
Agreement. If any provision of this Agreement shall be declared invalid or
unenforceable as a matter of law, such invalidity or unenforceability shall
not affect the validity or enforceability of any other provision of this
Agreement or of the remainder of this Agreement as a whole.
This Agreement sets forth all of the terms of the understanding
between the parties with reference to the subject matter set forth herein and
may not be waived, changed, discharged or terminated orally or by any course
of dealing between the parties, but only by an instrument in writing signed by
the party against whom any waiver, change, discharge or termination is sought.
8. NORTH CAROLINA LAW APPLIES. This Agreement shall be governed by
and construed in accordance with the laws of the State of North Carolina.
<PAGE>
9. NOTICES. Any notice or other communications to be given hereunder
shall be deemed to have been given or delivered when delivered by hand to the
individuals named below or when deposited in United States mail, registered or
certified, with proper postage and registration or certification fees prepaid,
addressed to the parties as follows (or to such other address as one party
shall give the other in the manner provided herein):
Family Dollar Stores, Inc. Post Office Box 1017
Charlotte, NC 28201-1017
Attention: Mr. Leon Levine
With copy to: George R. Mahoney, Jr.
Family Dollar Stores, Inc.
Post Office Box 1017
Charlotte, NC 28201-1017
John D. Reier: Family Dollar Stores, Inc.
Post Office Box 1017
Charlotte, NC 28201-1017
IN WITNESS WHEREOF, the parties hereto have executed this Agreement in
triplicate, all as of the day and year first above written.
FAMILY DOLLAR STORES, INC.
Attest:
By LEON LEVINE
LEON LEVINE
Chairman of the Board
GEORGE R. MAHONEY, JR.
GEORGE R. MAHONEY, JR.
Secretary
(Corporate Seal)
JOHN D. REIER (SEAL)
JOHN D. REIER
Witness:
ALICE R. BARRIER
ALICE R. BARRIER
