UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-Q
Quarterly report pursuant to Section 13 or 15 (d)
of the Securities Exchange Act of 1934
For the Quarterly period ended April 27, 1996
Commission file number 1-5745-1
FOODARAMA SUPERMARKETS, INC.
(Exact name of registrant as specified in its charter)
New Jersey 21-0717108
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) identification No.)
922 Highway 33, Freehold, N.J. 07728
(Address of principal executive offices)
Telephone #908-462-4700
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
and (2) has been subject to the filing requirements for at least
the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the close of the latest practicable
date.
OUTSTANDING AT
CLASS June 7,1996
Common Stock 1,118,150 shares
$1 par value<PAGE>
FOODARAMA SUPERMARKETS, INC.
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Unaudited Consolidated Balance Sheets
April 27, 1996 and October 28, 1995
Unaudited Consolidated Statements of
Operations for the thirteen weeks ended
April 27, 1996 and April 29, 1995
Unaudited Consolidated Statements of
Operations for the twenty six weeks ended
April 27, 1996 and April 29, 1995
Unaudited Consolidated Statements of
Cash Flows for the twenty six weeks ended
April 27, 1996 and April 29, 1995
Notes to the Consolidated Financial Statements
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
PART I FINANCIAL INFORMATION
FOODARAMA SUPERMARKETS, INC AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands)
April 27, October 28,
1996 1995
(Unaudited) (1)
ASSETS
Current assets:
Cash and cash equivalents $ 3,028 $ 3,435
Merchandise inventories 28,490 27,669
Receivables and other current assets 2,663 2,916
Related party receivables - Wakefern 3,103 4,804
Related party receivables - other 386 508
Total current assets 37,670 39,332
Property and equipment:
Land 1,650 1,650
Buildings and improvements 1,867 1,867
Leaseholds and leasehold improvements 30,410 30,188
Equipment 47,196 45,679
Property and equipment under capital leases 14,064 14,064
95,187 93,448
Less accumulated depreciation and
amortization 47,310 45,296
47,877 48,152
Other assets:
Investments in related parties 8,315 8,315
Intangibles 5,664 6,038
Other 3,867 7,198
Related party receivables - Wakefern 918 871
Related party receivables - other 1,224 1,078
19,988 23,500
$ 105,535 $110,984
(continued)
(1) Derived from the Audited Consolidated Financial Statements for the year
ended October 28, 1995.
See accompanying notes to consolidated financial statements.
FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands except share data)
April 27, October 28,
1996 1995
(Unaudited) (1)
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 4,838 $ 7,715
Current portion of long-term debt,
related party - 86
Current portion of obligations under
capital leases 334 303
Current income tax liability (354) 77
Deferred income tax liability 1,295 1,295
Accounts payable:
Related party 19,292 20,239
Others 6,336 5,753
Accrued expenses 8,643 8,315
Total current liabilities 40,384 43,783
Long-term debt 17,502 20,349
Obligations under capital leases 7,802 7,985
Deferred income taxes 2,716 2,716
Other long-term liabilities 5,889 5,779
Total long-term liabilities 33,909 36,829
Mandatory redeemable preferred stock
$12.50 par; authorized
1,000,000 shares; issued 136,000 shares 1,700 1,700
Shareholders' equity:
Common stock, $1.00 par; authorized
2,500,000 shares; issued 1,621,627 shares 1,622 1,622
Capital in excess of par 2,351 2,351
Retained earnings 32,997 32,127
Minimum pension liability adjustment (806) (806)
36,164 35,294
Less 503,477 shares, held in
treasury, at cost 6,622 6,622
Total shareholders' equity 29,542 28,672
$ 105,535 $ 110,984
(1) Derived from the Audited Consolidated Financial Statements for the year
ended October 28, 1995. See accompanying notes to consolidated financial
statements.
FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations - Unaudited
(in thousands - except share data)
13 Weeks Ended
April 27, April 29,
1996 1995
Sales $ 140,815 $ 147,432
Cost of merchandise sold 105,290 110,220
Gross profit 35,525 37,212
Store operating, general and
administrative expenses 34,264 36,375
Income from operations 1,261 837
Other (expense) income:
Gain on the sale of stores - 570
Interest expense (721) (1,215)
Interest income 53 5
Income before taxes and extraordinary item 593 197
Income tax provision 219 51
Income before extraordinary item 374 146
Extraordinary item: Early extinguishment of
debt (net of taxes of $480) - (1,368)
Net income (loss) $ 374 $(1,222)
Income per common share before extraordinary
item $ .31 $ .10
Extraordinary item - (1.22)
Net income (loss) per common share $ .31 $ (1.12)
Weighted average number of common
shares outstanding 1,118,150 1,118,150
Dividends per common share -0- -0-
See accompanying notes to consolidated financial statements.
FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations - Unaudited
(in thousands - except share data)
26 Weeks Ended
April 27, April 29,
1996 1995
Sales $ 287,118 $ 300,246
Cost of merchandise sold 215,053 225,716
Gross profit 72,065 74,530
Store operating, general and
administrative expenses 69,153 72,385
Income from operations 2,912 2,145
Other (expense) income:
Gain on the sale of stores - 570
Interest expense (1,603) (2,534)
Interest income 72 26
Income before taxes, extraordinary item and
cumulative effect of change in accounting 1,381 207
Income tax provision 511 54
Income before extraordinary item and cumulative
effect of change in accounting 870 153
Extraordinary item: Early extinguishment of
debt (net of taxes of $480) - (1,368)
Cumulative effect of change in accounting
(net of taxes of $61) - ( 175)
Net income (loss) $ 870 $ (1,390)
(continued)<PAGE>
FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations - Unaudited
(in thousands - except share data)
(continued)
26 Weeks Ended
April 27, April 29,
1996 1995
Income per common share before extraordinary
item and cumulative effect of change
in accounting $ .72 $ .08
Extraordinary item - (1.22)
Cumulative effect of change in accounting - ( .16)
Net income (loss) per common share $ .72 $ (1.30)
Weighted average number of common
shares outstanding 1,118,150 1,118,150
Dividends per common share -0- -0-
See accompanying notes to consolidated financial statements.
<PAGE>
FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows - Unaudited
(in thousands)
26 Weeks Ended
April 27,1996 April 29,1995
Cash flows from operating activities:
Net income (loss) $ 870 $ (1,390)
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation 3,923 4,411
Amortization, intangibles 374 362
Amortization, deferred financing costs 459 229
Amortization, escalation rents 161 295
Amortization, other assets - 64
Gain on sale of property - (570)
Changes in assets and liabilities:
(Increase) decrease in inventories (821) 386
Decrease in receivables and other
current assets 253 1,224
Decrease (increase) in other assets 2,679 (1,413)
Decrease in related party receivables-Wakefern 1,701 2,485
Decrease in related party receivables-other 122 -
Decrease in accounts payable (364) (4,275)
Decrease in other liabilities (154) (1,583)
Net cash provided by operating
activities 9,203 225
Cash flows from investing activities:
Purchase of property and equipment (3,648) ( 624)
Net proceeds from sale of property - 945
Net cash (used in) provided by
investing activities (3,648) 321
Cash flows from financing activities:
Principal payments under long-term debt (9,878) (35,987)
Principal payments under capital
lease obligations (152) ( 467)
Proceeds from issuance of debt 4,068 35,005
Net cash used in financing activities (5,962) (1,449)
NET DECREASE IN CASH AND CASH EQUIVALENTS (407) (903)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 3,435 5,542
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 3,028 $ 4,639
See accompanying notes to consolidated financial statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
Note 1 Basis of Presentation
The unaudited Consolidated Financial Statements as of April 27, 1996,
included herein, have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and rule 10-01. The balance sheet at October 28,
1995 has been derived from the audited financial statements at that date. In
the opinion of the management of the Registrant, all adjustments (consisting
only of normal recurring accruals) which the Registrant considers necessary
for a fair presentation of the results of operations for the period have been
made. Certain financial information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted. The reader is
referred to the consolidated financial statements and notes thereto included
in the Registrant's annual report on Form 10-K for the year ended October 28,
1995.
Certain reclassifications have been made to prior year financial statements
in order to conform to the current year presentation.
These results are not necessarily indicative of the results for the entire
fiscal year.
Note 2 Adoption of Accounting Standards
Employee Benefit plans
Effective October 30, 1994, the Registrant adopted Statement of Financial
Accounting Standards (SFAS) No. 112, "Employers' Accounting for
Postemployment Benefits." SFAS No. 112 requires the accrual for
postemployment benefits provided to former or inactive employees. The effect
of this change resulted in a pre tax charge of $236,000 and an after tax
charge of $175,000 or $.16 per common share in the quarter ended January 29,
1995. There was no material effect on earnings, in the quarter ended April
27, 1996, from the adoption of SFAS No. 112. Prior to this change, the
Registrant charged these amounts to expense on a cash basis.
Part I - Item 2 Management's Discussion and Analysis of Financial
Condition and Results of Operations
Financial Condition and Liquidity
On February 15, 1995, the Company entered into a Revolving Credit and Term
Loan Agreement ("the Agreement") with a consortium of banks providing for a
total commitment of $38,000,000, secured by substantially all of the
Registrant's assets. The proceeds from this financing were utilized to repay
the Registrant's senior notes and bank debt which totaled $33,200,000. The
Agreement provides a working capital facility ("Revolving Note") to fund
future operations and capital expenditures.
The Agreement consists of three Term Loans (A, B and C) and a Revolving Note.
Term Loan A totals $2,000,000, bears interest at 2% over prime, and was due
August 15, 1995. Term Loan B totals $8,500,000, bears interest at 2% over
prime and was due February 15, 1996. Term Loans A an B are required to be
repaid from asset sales or equipment refinancing. Term Loan C totals
$12,500,000 and bears interest at 2% over prime until Term Loans A and B are
repaid, at which time interest is reduced to 1.25% over prime. Term Loan C
is payable in quarterly installments commencing March 31, 1996 thru December
31, 1998. The Revolving Note, with a total availability, based on 60% of
eligible inventory, of $15,000,000, bears interest at 1.5% over prime until
Term Loans A and B are repaid, at which time interest is reduced to 1.25%
over prime. A commitment fee of 1/2 of 1 percent is charged on the unused
portion of the Revolving Note.
Pursuant to the provisions of the terminated loan agreements, the Registrant
was required to pay a special premium totaling $1,100,000. Additionally, the
Registrant paid the new lenders a facility fee of $1,000,000 and an annual
administrative fee of $150,000. The Registrant wrote off, in the second
quarter of 1995, expenses of $1,848,000 ($1,009,000 after taxes, as adjusted
in the fourth quarter of fiscal 1995 for the fiscal year effective tax rate),
including the special premium related to the early extinguishment of debt.
The Agreement contains certain affirmative and negative covenants which,
among other matters will, (I) restrict capital expenditures, (ii) require the
maintenance of certain levels of net worth and earnings before interest,
taxes, depreciation and amortization, and maintenance of (iii) fixed charge
coverage and total liabilities to net worth ratios. The Registrant was in
compliance with such covenants through April 27, 1996.
The new Agreement combined with an asset redeployment plan described below
strengthens the Registrant's financial condition by reducing outstanding
debt, lowering interest cost and providing working capital through the
Revolving Note.
In order to repay Term Loans A and B on a timely basis, the Registrant has
developed an Asset Redeployment Program. This program consists of the sale
of the assets of two supermarkets, located in Bethlehem and Whitehall,
Pennsylvania, the sale of a real estate partnership interest in a
non-supermarket property located in Shrewsbury, New Jersey, the sale/leaseback
or mortgaging of buildings owned by the Registrant and located in Linden and
Aberdeen, New Jersey and the financing of equipment at three operating
locations in Neptune, Piscataway and Sayreville, New Jersey. Other than the
sale of the two supermarkets in Pennsylvania, it is not anticipated that the
Asset Redeployment Program will have any impact on the Registrant's sales,
gross margins or net income. As of April 27, 1996 Term Loan A and Term Loan
B had been fully repaid and Term Loan C had an outstanding balance of
$11,392,500. Except for the sale of the assets of the two Pennsylvania
supermarkets and the financing of equipment at three operating locations,
other aspects of the Asset Redeployment Program remain to be completed.
On May 23, 1995 the Registrant concluded the sale of its two operating
locations in Pennsylvania for $5,700,000 plus inventory of $2,300,000 and
obtained the return of its investment of $1,200,000 in Wakefern, a related
party, with respect to the two stores. All proceeds were in cash and were
used to reduce outstanding debt. Proceeds of $2,000,000 were used to repay
Term Loan A, $3,000,000 was applied against Term Loan B, $1,200,000 of
equipment leases were fully repaid, $900,000 repaid debt due to Wakefern and
the balance of the proceeds was applied against accounts payable and the
Revolving Note.
On January 19, 1996, $700,000 of term Loan B was repaid from the proceeds of
a worker's compensation insurance deposit which was returned to the
Registrant.
On January 25, 1996 the Registrant financed the equipment at the three
locations discussed above. The note bears interest at 10.58% and is payable
in monthly installments over its four year term. $4,000,000 of the proceeds
were applied against Term Loan B with the balance of $68,000 used to repay
existing equipment financing in two of the stores. This payment completed the
repayment of Term Loan B.
On February 2, 1996, $265,000 of Term Loan C was repaid from the proceeds of
the worker's compensation insurance deposit discussed above, on February 7,
1996, $125,000 of Term Loan C was repaid from the proceeds of a New York
State tax refund and on March 29, 1996 a scheduled quarterly payment of
$717,500 was made on Term Loan C.
The Registrant's compliance with the major financial covenants under the
Agreement was as follows as of April 27, 1996.
Actual
Financial (As defined in the
Covenant Agreement Agreement)
Capital Expenditures Less than $9,839,000 $ 6,779,000
Net Worth Greater than $27,500,000 $31,843,000
Fixed Charge Coverage
Ratio Greater than .8 to 1.00 1.25 to 1.00
Total Liabilities to
Net Worth Ratio Less than 2.80 to 1.00 2.22 to 1.00
EBITDA Greater than $14,200,000 $17,054,000
On February 16, 1993, in order to partially fund capital expenditures made
in fiscal 1992 and also to induce the senior lenders to amend the loan
agreements, the Registrant sold to Wakefern Food Corporation 136,000 shares
of duly authorized Class A 8% Cumulative Convertible Preferred Stock (the
"Preferred Stock") par value $12.50 per share, for $1,700,000, the aggregate
par value of such shares. The Preferred Stock bears a preferential cumulative
dividend at the rate of 8% per annum for three years, increasing at the rate
of 2% per annum each 12 months thereafter.
The Preferred Stock is redeemable by the Registrant in whole or in part at
any time and must be redeemed by the earlier of (I) June 8, 1999, (ii)
consummation of the sale of all or substantially all of the Registrant's
assets or upon entering into the first of a related series of transactions
for the purpose of selling all or substantially all of the Registrant's
assets, (iii) the changing of shares of the Common Stock of the Registrant
into, or the exchange of such shares for, the securities of any other
corporation, or (iv) a "Change of Control" (as such term is defined in the
Registrant's Certificate of Incorporation) of its equity voting securities
by way of merger, consolidation or otherwise. The Preferred Stock was
convertible by Wakefern at any time after March 31, 1996 into shares of the
Common Stock of the Registrant at the then market value of such shares at a
conversion value of $12.50 per share of Preferred Stock but with the
provision that no more than 1,381,850 shares (representing the total of the
Registrant's unissued and treasury shares) may be issued on conversion of all
of the Preferred Stock. The Agreement provides that no dividends may be paid
on nor may any Preferred Stock be redeemed unless the Registrant has met or
exceeded its financial performance and debt reduction targets for the year
ended October 28, 1995. As of April 27, 1996 all these targets have been met.
As of March 29, 1996 the Registrant and Wakefern amended certain provisions
of the Preferred Stock to (a) extend the date after which Wakefern shall be
entitled to convert the Preferred Stock to Common Stock from March 31, 1996
to March 31, 1997; and (b) defer the 2% increase in the dividend rate
effective March 1996 to March 1997. On May 14, 1996 the Registrant paid
dividends in arrears on the Preferred Stock of $456,980 as well as the
current quarterly dividend of $34,000.
No cash dividends have been paid on the Common Stock since 1979, and the
Registrant has no present intentions or ability to pay any dividends in the
near future on its Common Stock. The Agreement does not permit the payment
of any cash dividends on the Registrant's Common Stock.
Working Capital
At April 27, 1996, the Registrant had a working capital deficiency of
$2,714,000 compared to a deficiency of $4,451,000 at October 28, 1995 and a
deficiency of $11,808,000 at April 29, 1995.
The Registrant normally requires small amounts of working capital since
inventory is generally sold prior to the time that payments to Wakefern and
other suppliers are due.
Working capital ratios were as follows:
April 27, 1996 0.93 to 1.0
October 28, 1995 0.90 to 1.0
April 29, 1995 0.77 to 1.0
Cash flows (in millions) were as follows:
4/27/96 4/29/95
Operating activities... $ 9.2 $ .2
Investing activities... (3.6) .3
Financing activities... (6.0) (1.4)
Totals $(0.4) $(0.9)
The Registrant had $7,994,000 of available credit, at April 27, 1996, under
its revolving credit facility and believes that its capital resources are
adequate to meet its operating needs, scheduled capital expenditures and its
debt service in fiscal 1996.
The decrease in other assets was due to the return to the Registrant of
$1,230,000 of collateral and the exchange of an additional $2,000,000 of
collateral for a letter of credit with the worker's compensation insurance
carrier. The decrease in related party receivables-Wakefern was due to the
receipt in December 1995 of $3,040,000 for the balance of the patronage
dividend due for Wakefern's year ended September 30, 1995 offset by a
receivable of $1,147,000 for the patronage dividend for Wakefern's current
year.
Depreciation was $3,923,000 while capital expenditures totaled $3,648,000,
compared to $4,411,000 and $624,000 respectively in the prior year period.
Results of Operations (13 weeks ended April 27, 1996 compared to 13
weeks ended April 29, 1995)
Sales:
Same store sales from the eighteen stores in operation in both periods
increased 4.3% in the current year period versus the prior year period.
An increase in promotional activities in the current period, as well as
improved inventory stocking levels, contributed to this increase.
Sales for the eighteen stores in operation for the current quarter totaled
$140.8 million as compared to $147.4 million of sales from the twenty stores,
including the two Pennsylvania stores sold in May 1995, operated in the prior
year period.
Gross Profit:
Gross profit on sales was 25.2% of sales in both the current and prior year
periods. Patronage dividends, applied as a reduction of the cost of
merchandise sold, were $1.1 million in both periods. The exclusion of results
of the two Pennsylvania stores, from the prior year results, would not have
had any material impact on gross profit percentages when comparing the
current period to the prior year period.
Operating Expenses:
Store operating, general and administrative expenses as a percent of sales
were 24.3% versus 24.7% in the prior year period. Although the reduction in
sales in the current period contributed to an increase in percent of general
and administrative costs, and promotion, snow removal and utility costs
increased, these increases were more than offset by lower supply costs and
occupancy expense. Income from the sale of cardboard declined by $94,000 due
to a drop in the cardboard market.
Interest Expense:
Interest expense decreased to $721,000 from $1,215,000 while interest income
was $53,000 compared to $5,000 for the prior period. The decline in interest
expense for the current year period was due to a decrease in outstanding debt
of $17,500,000 since April 29, 1995, as well as a decrease in the interest
rate paid on debt.
Income Taxes:
An income tax rate of 37% has been used in the current period based on the
expected effective tax rate for fiscal 1996, while a rate of 26% was used in
the prior year period.
Net Income:
Net income was $374,000 in the current year period. This compares to $146,000
in the prior year period before the extraordinary item resulting from the
write off of costs related to the early extinguishment of debt and a loss of
$1,222,000 in the prior year period after the extraordinary item. Net income
before taxes, as well as EBITDA, for the thirteen weeks ended April 29, 1995
included a gain on the sale of property of $570,000 ($422,000 after taxes).
Earnings before interest, taxes, depreciation and amortization ("EBITDA") for
the current period were $3,577,000 as compared to $4,149,000 in the prior
year period. Net income per common share was $.31 in the current period
compared to income of $.10 in the prior year period before the extraordinary
item. Both period calculations are based on 1,118,150 shares outstanding and
a provision of $34,000 for preferred stock dividends.
Results of Operations (26 weeks ended April 27, 1996 compared to 26
weeks ended April 29, 1995)
Sales:
Same store sales from the eighteen stores in operation in both periods
increased 4.9% in the current year period versus the prior year period. An
increase in promotional activities in the current period, as well as improved
inventory stocking levels, contributed to this increase.
Sales for the eighteen stores in operation for the current year twenty six
week period totaled $287.1 million as compared to $300.2 million of sales
from the twenty stores, including the two Pennsylvania stores sold in May
1995, operated in the prior year period.
Gross profit:
Gross profit on sales increased slightly to 25.1% of sales compared to 24.8%
in the prior year period. Patronage dividends, applied as a reduction of the
cost of merchandise sold, were $2.2 million compared to $2.3 million in the
prior year period. The exclusion of results of the two Pennsylvania stores,
from the prior year results, would not have had any material impact on gross
profit percentages when comparing the current period to the prior year
period.
Operating Expenses:
Store operating, general and administrative expenses as a percent of sales
were 24.1% in both periods. Although the reduction in sales in the current
period contributed to an increase in percent of general and administrative
costs, and promotion and snow removal costs increased, these increases were
offset by lower store payroll and occupancy costs. Income from the sale of
cardboard declined by $241,000 due to a drop in the cardboard market.
Interest Expense:
Interest expense decreased to $1,603,000 from $2,534,000 while interest
income was $72,000 compared to $26,000 for the prior period. The decline in
interest expense for the current year period was due to a decrease in
outstanding debt of $17,500,000 since April 29, 1995, as well as a decrease
in the interest rate paid on debt.
Income Taxes:
An income tax rate of 37% has been used in the current period based on the
expected effective tax rate for fiscal 1996, while a rate of 26% was used in
the prior year period.
Net Income:
Net income was $870,000 in the current year period. This compares to $153,000
in the prior year period before an extraordinary item and the cumulative
effect of a change in accounting and a loss of $1,390,000 in the prior year
period after the extraordinary charge and the cumulative effect of a change
in accounting. Net income in the prior year period includes an after tax gain
of $422,000 on the sale of property. Earnings before interest, taxes,
depreciation and amortization ("EBITDA") for the current period were
$7,829,000 as compared to $7,506,000 in the prior year period before the gain
on the sale of property. Net income per common share was $.72 in the current
period compared to $.08 in the prior year period before the extraordinary
charge and the cumulative effect of a change in accounting. Both period
calculations are based on 1,118,150 shares outstanding and a provision of
$68,000 for preferred stock dividends.
PART II
OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Exhibit (3)(i) - Amendment to the Certificate
of Incorporation of Foodarama Supermarkets, Inc.
dated April 4, 1996.
Exhibit (27) - Financial Data Schedule.
Exhibit (99)(i) - Amendment of Revolving
Credit and Term Loan Agreement - dated as
of May 10, 1996.
Exhibit (99)(ii) - Agreement with Wakefern
Food Corporation - dated as of March 29, 1996.
(b) No reports on Form 8-K were required to be
filed for the 13 weeks ended April 27, 1996.
SIGNATURES
Pursuant to the requirements 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.
FOODARAMA SUPERMARKETS, INC.
(Registrant)
Date: June 10, 1996 /S/ MICHAEL SHAPIRO
(Signature)
Michael Shapiro
Senior Vice President
Chief Financial Officer
Date: June 10, 1996 /S/ JOSEPH C. TROILO
(Signature)
Joseph C. Troilo
Senior Vice President
Principal Accounting Officer
<PAGE>
EXHIBIT (3)(i)
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
FOODARAMA SUPERMARKETS, INC.
To: The Secretary of State
State of New Jersey
Pursuant to the provisions of Section 14A:7-2(2) of the New Jersey
Business Corporation Act, the undersigned corporation executes the
following Certificate of Amendment to its Certificate of Incorporation:
First: The name of the corporation (the "Corporation") is Foodarama
Supermarkets, Inc.
Second: Pursuant to the authority expressly vested in it by the
provisions of the Certificate of Incorporation of the Corporation, the
Board of Directors of the Corporation duly adopted the following
resolution:
RESOLVED, that pursuant to the authority vested in the Board of
Directors of this Corporation in accordance with the provisions of Article
Fifth of its Certificate of Incorporation, the Board of Directors hereby
amends the relative rights of the Class A 8% Cumulative Convertible
Preferred Stock (hereinafter referred to as "Class A Preferred Stock") so
that (i) the first date upon which the Class A Preferred Stock may be
converted is hereby changed from March 31, 1996 to March 31, 1997; and
(ii) the date that the first 2% increase in the dividend rate of the Class
A Preferred Stock will occur is hereby changed from the third anniversary
date of the date of issuance of such shares to the fourth anniversary date
of the date of issuance of such shares with a corresponding one-year
postponement of all subsequent 2% increases in dividend rate.
RESOLVED, that the designation, voting powers, preferences and
relative, participating, and other rights, and qualifications, limitations
and restrictions of the Class A Preferred Stock are as follows:
1. Definitions
"Average Market Price" means, the average of the closing prices of
the Corporation's Common Stock, par value $1.00 per share ("Common
Stock"), regular way, on all trading days in the sixty (60) day period
prior to the date as of which Average Market Price is to be calculated, or
if no sale takes place on <PAGE>
any such trading day, the mean between the closing
bid and asked prices of the Common Stock on such trading day. The Average
Market Price shall be subject to adjustment to give effect to (i) the
declaration of any dividend on the Common Stock in shares of the
Corporation's capital stock, (ii) the subdivision of the outstanding Common
Stock, (iii) the combination of the outstanding shares of Common Stock into a
lesser number of shares, (iv) the issuance by reclassification of the Common
Stock of any shares of the Corporation's capital stock and (v) any similar
happening or event, in each case, to the extent such occurs during the
sixty day period used to calculate Average Market Price.
"Business Day" means any day which is not a Saturday, a Sunday, a
legal holiday or a day on which banking institutions in New York City are
authorized or required by law, regulation or executive order to be closed.
"Redemption Event" means the earlier of (i) such time that the
Corporation shall have (a) sold all or substantially all of its assets, or
shall have entered into the first of a series of related transactions for
the purpose of selling all or substantially all of its assets, (b)
experienced a Change in Control (as defined below) of its equity voting
securities by way of merger, consolidation or otherwise or (c) changed the
shares of Common Stock of the Corporation into, or exchanged such shares
for, the securities of any other corporation or (ii) June 8, 1999.
"Change in Control" shall mean: (a) the acquisition by any individual,
entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) of the lesser of (i) more of the combined voting power
of the then outstanding voting securities of the Corporation entitled to
vote generally in the election of directors than is then held in the
aggregate by (x) Joseph Saker, his affiliates, family members, estate,
heirs or members of a "group" with him and (y) Richard Saker
(collectively, "Saker") or (ii) 50% or more of the combined voting power
of the then outstanding voting securities of the Corporation entitled to
vote generally in the election of directors; (b) the acquisition from
Saker and/or the Company by any individual, entity or "group" other than
an underwriter in connection with a firm underwritten offering of any
securities of the Corporation, which acquisition is not consented to by
the holders of at least 50% of the shares of Class A Preferred Stock (as
defined below), of beneficial ownership of an aggregate of 5% or more of
the combined voting power of the then outstanding voting securities of the
Corporation entitled to vote generally in the election of directors; (c)
the Common Stock shall cease to be registered under the Exchange Act; (d)
if Saker shall sell or otherwise transfer (in oe transaction or series of
transactions) more than 25% of the shares of Common Stock owned by Saker
on the date hereof (after giving affect to any dilutive events); or (e)
if, after any election of a member to the Board of Directors of the
Corporation, a majority of the Board shall consist of members not
nominated, or not elected, by a majority of the members of the immediately
preceding Board of Directors who have served as such for at least eleven
(11) months. Notwithstanding the preceding sentence, the assignment, sale
or other transfer of the Class A Preferred Stock shall not constitute a
Change of Control.
2. Designation
The series of preferred stock is designated "Class A 8% Cumulative
Convertible Preferred Stock" (hereinafter referred to as "Class A
Preferred Stock"), par value $12.50 per share (the "Par Value"), and the
number of shares which shall constitute such series shall be 136,000
shares, which number of shares may be increased or decreased (but not
below the number thereof then outstanding) from time to time by the Board
of Directors. So long as any Class A Preferred Stock shall be outstanding
the Corporation shall not issue any additional shares of Class A Preferred
Stock or any equity security on a parity with or senior to Class A
Preferred Stock without the consent of the holders of in excess of a
majority of the then outstanding Class A Preferred Stock. No Class A
Preferred Stock acquired by the Corporation by reason of redemption,
purchase or otherwise shall be reissued, and all such shares shall be
cancelled, retired and eliminated form the shares which the Corporation
shall be authorized to issue.
3. Dividends
The holders of record of shares of the Class A Preferred Stock shall
be entitled to receive cumulative preferential cash dividends when and as
declared by the Board of Directors out of funds legally available
therefor. In the event that sufficient funds for any dividend shall not
at any time be otherwise legally available, the Corporation shall use its
best efforts to cause such availability to come into existence. So long
as any shares of Class A Preferred Stock shall remain outstanding, the
Corporation may not declare or pay any dividend, make a distribution, or
purchase, acquire, redeem, pay monies to the holders of, or set aside or
make monies available for a sinking fund for the purchase or redemption
of, any shares of Common Stock or any share of any other class or series
of the Corporation's preferred stock ranking junior to the Class A
Preferred Stock with respect to the payment of dividends or the
distribution of assets on liquidation, dissolution or winding up of the
Corporation unless (i) all dividends in respect of the Class A Preferred
Stock for all past dividend periods have been paid and such dividends for
the current dividend period have been paid or declared and duly provided
for, and (iii) all amounts in respect of the mandatory redemption of Class
A Preferred Stock pursuant to the terms of paragraph 6A below have been
paid. Dividends on the Class A Preferred Stock shall be payable
quarterly in arrears on January 31, April 30, July 31, and October 31 of
each year (each a "Dividend Date") beginning April 30, 1993 at the rate
per share equal to eight (8%) percent of the Par Value per annum; provided
that from and after the fourth anniversary date of the date of issuance of
Class A Preferred Stock, the rate per annum at which dividends shall
accrue with respect to such shares shall increase by two (2%) percent per
year; provided further, however, that if the rate in effect each year as a
result of such increase is not permitted by applicable law, such dividends
shall accrue at the highest rate then permitted under applicable law.
Dividends on the Class A Preferred Stock shall accrue and compound from
the date of issuance and shall be cumulative, whether or not declared or
paid. The amount of any dividends accrued on any share of the Class A
Preferred Stock at any Dividend Date shall be deemed to be an amount equal
to the sum of the amount of any unpaid dividends accumulated thereon to
and including such Dividend Date, whether or not earned or declared (and
whether or not in any dividend period or periods there are net profits or
net assets of the Corporation legally available therefor), and the amount
of dividends accrued on any share of the Class A Preferred Stock at any
date other than a Dividend Date shall be an amount calculated on the basis
of the annual dividend rate for the period after such last preceding
Dividend Date to and including the dates on which the calculation is made,
based on a 360-day year of twelve 30-day months.
Subject to the provisions set forth above in this Section 3,
dividends as may be determined by the Board of Directors may be declared
and paid from time to time out of any funds legally available for the
payment of dividends, and the Class A Preferred Stock shall not be
entitled to participate in any such dividends, whether payable in cash,
stock or otherwise.
4. Liquidation
In the event of any liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, the holders of the Class A
Preferred Stock shall be entitled to receive out of the assets of the
Corporation, before any distribution or payment or setting apart or
payment shall be made to the holders of any Common Stock or any share of
any other class or series of the Corporation's preferred stock ranking
junior to the Class A Preferred Stock, $12.50 per share together with an
amount equal to all accrued and unpaid dividends thereon to the date fixed
for payment.
A consolidation or merger of the Corporation with one or more other
corporations shall not be deemed to be a liquidation, dissolution or
winding up within the meaning of this paragraph 4.
In case amounts payable on liquidation, dissolution or winding up on
the Class A Preferred Stock including all accrued dividends are not paid
in full, the shares of all Class A Preferred Stock shall share ratably in
the payments of dividends, including accumulations thereof, if any, in
accordance with the sums which would be payable on said shares if all
accrued dividends were declared and paid in full, and in any distribution
of assets other than by way of dividends, ratably in accordance with the
sums which would be payable on such distribution if all sums payable were
discharged in full.
No payment on account of such dissolution, liquidation or winding up
of the Corporation shall be made to holders of any other class or series
of stock ranking on a parity with Class A Preferred Stock with respect to
preferential distribution of assets unless a payment on account of such
dissolution, liquidation or winding up shall be made at the same time to
holders of Class A Preferred Stock in proportion to the full distributive
amounts to which they and holders of such parity stock are respectively
entitled.
Written notice of any voluntary or involuntary liquidation,
dissolution or winding up of the affairs of the Corporation, stating the
payment date and the place where the distributable amounts shall be
payable and containing a reference to the conversion right set forth in
paragraph 7 below, shall be given by mail, postage prepaid, not less than
30 days prior to the payment date stated therein, to the holders of record
of Class A Preferred Stock at their respective addresses as the same shall
appear on the books of the Corporation.
5. Voting Rights
Except as otherwise required by law, the holder of each share of
Class A Preferred Stock shall not be entitled to any voting rights with
respect to the shares of Class A Preferred Stock held by such holder.
6. Redemption
A. Mandatory Redemption. The Corporation shall be required to
redeem all outstanding Class A Preferred Stock prior to or concurrently
with the occurrence of the Redemption Event specified in clause (i) of the
definition thereof and upon the occurrence of the Redemption Event
specified in clause (ii) of the definition thereof, at $12.50 per share in
cash together with an amount equal to all accrued and unpaid dividends
thereon to the Redemption Date (as defined below); provided, that if there
are insufficient legally available funds for redemption under this
paragraph 6A, the Corporation shall redeem such lesser number of shares of
Class A Preferred Stock, to the extent there are funds legally available
therefor, and shall redeem all or part of the remainder of the shares of
Class A Preferred Stock subject to redemption as soon as the Corporation
has sufficient funds which are legally available therefor until all such
shares of Class A Preferred Stock have been redeemed.
B. Optional Redemption. The Corporation may redeem the outstanding
shares of Class A Preferred Stock in whole, or from time to time in part,
upon notice given as hereinafter specified, at $12.50 per share in cash
together with an amount equal to all accrued and unpaid dividends thereon
to the Redemption Date; provided, however, that if the Corporation shall
have failed to pay all dividends on the outstanding shares of Class A
Preferred Stock that shall have accrued through the end of the immediately
preceding Dividend Date, and shall not have set apart a sum sufficient for
the payment of all such dividends that shall have accrued to the
Redemption Date, the Corporation shall not redeem less than all of the
outstanding shares of Class A Preferred Stock without the consent of the
holders of at least 51% of the outstanding shares of Class A Preferred
Stock.
C. Notice of every redemption shall be given by mailing such notice
not less than 20 nor more than 60 days prior to the date fixed for such
redemption (the "Redemption Date") (or, in the case of a redemption notice
given after a notice of conversion is delivered to the Corporation
pursuant to Paragraph 7 hereof, by facsimile or hand delivery not later
than the close of business on the day prior to the Redemption Date) to
each holder of record of such shares so to be redeemed at his address as
the same shall appear on the books of the Corporation. Such notice shall
specify the date, time and place of redemption, the redemption price per
share and, if less than all shares owned by any holder are to be redeemed,
shall also specify the number of shares which are to be redeemed.
In case of redemption of only a part of the Class A Preferred Stock
at the time outstanding, such redemption shall be effected pro rata
according to the number of shares held by each holder of Class A Preferred
Stock.
If any such notice of redemption shall have been duly given, then,
notwithstanding that any certificate for shares so called for redemption
shall not have been surrendered for cancellation, from and after the
Redemption Date all shares so called for redemption shall no longer be
deemed to be outstanding and all rights with respect to such shares
(except for the right to receive the redemption price) shall forthwith
cease and terminate. In the event that less than all of the shares
represented by any certificate are redeemed, a new certificate shall be
issued representing such shares which are not redeemed.
<PAGE>
7. Conversion
The Corporation has 1,381,850 shares of Common Stock available for
issuance on conversion of the Class A Preferred Stock, which number
includes 503,477 shares of treasury stock. Such number of shares of
Common Stock, less the number theretofore issued by any date pursuant to
the prior conversion of any shares of Class A Preferred Stock, is hereby
referred to as the "Total". From and after March 31, 1997, shares of
Class A Preferred Stock and any and all accrued and unpaid dividends
thereon at the Conversion Date (as defined below) shall, without
additional payment therefor, be convertible at the option of the holder
into the lesser of (x) the number of shares of Common Stock of the
Corporation determined by multiplying the number of shares of Class A
Preferred Stock tendered for conversion by $12.50, adding to such product
the amount of all accrued and unpaid dividends in respect of such tendered
shares and dividing such sum by the Average market Price of the Common
Stock calculated as of the Conversion Date and (y) a number determined by
multiplying the then Total by a fraction, the numerator of which shall be
the number of shares of Class A Preferred Stock then tendered for
conversion and the denominator of which shall be the then total number of
outstanding shares of Class A Preferred Stock not then called for
redemption; provided, however, that shares called for redemption pursuant
to paragraph 6 hereof shall not be permitted to be converted by a holder
unless and until the Corporation shall default in the payment of the
redemption price of such shares.
The Corporation will not be required to issue fractional shares of
Common Stock upon the conversion of Class A Preferred Stock and will pay a
cash adjustment in lieu thereof as necessary to permit the issuance of
whole shares of Common Stock.
The holder of any shares of Class A Preferred Stock may exercise its
option to convert such shares and the accrued and unpaid dividends thereon
into shares of Common Stock only by surrendering for such purpose to the
Corporation at the principal office of the Corporation certificates
representing the shares to be converted, accompanied by written notice
that such holder elects to convert such shares in accordance with this
paragraph 7. Said notice shall also state the name or names (with
addresses) in which the certificate or certificates for shares of Common
Stock which shall be issuable on such conversion shall be issued. Each
certificate or certificates surrendered for conversion shall, unless the
shares issuable on conversion are to be issued in the same name as that in
which such certificate or certificates are registered, be accompanied by
instruments of transfer, in form satisfactory to the Corporation, duly
executed by the holder or his duly authorized attorney. Each conversion
shall be deemed to have been effected on the date which is ten (10) days
after the date on which such certificate or certificates shall have been
surrendered and such notice received by the Corporation as aforesaid;
provided that the shares of Class A Preferred Stock have not theretofore
been redeemed pursuant to paragraph 6 hereof or repurchased pursuant to
the terms of the Securities Purchase Agreement dated as of February 16,
1993 among Wakefern Food Corporation, the Corporation, Joseph Saker and
Richard Saker (the "Conversion Date"), and the person or persons in whose
name or names any certificate or certificates for shares of Common Stock
shall be issuable upon such conversion shall be deemed to have become on
said date the holder or holders of record of the shares represented
thereby notwithstanding that the transfer books of the Corporation may
then be closed or that certificates representing such shares of Common
Stock shall not then be actually delivered to such person.
Except as expressly set forth above, upon any such conversion of
shares of Class A Preferred Stock, no allowance, adjustment or payment
shall be made with respect to accrued dividends upon either class of
stock.
The issue of stock certificates on conversion of shares of Class A
Preferred stock and the accrued and unpaid dividends thereon shall be made
without charge to converting holders of Class A Preferred Stock for any
tax in respect of the issue thereof. The Corporation shall not, however,
be required to pay any tax which may be payable in respect of any
registration of transfer involved in the issue and delivery of stock in
any name other than that of the holder of any shares of Class A Preferred
Stock converted, and the Corporation shall not be required to so issue or
deliver any stock certificate unless and until the person or persons
requesting the registration of transfer shall have paid to the Corporation
the amount of such tax or shall have established to the satisfaction of
the Corporation that such tax has been paid.
The Corporation shall at all times reserve and keep available out of
its authorized Common Stock the full number of shares of Common Stock
deliverable upon the conversion of all outstanding shares of Class A
Preferred Stock and all accrued and unpaid dividends thereon.
The Corporation shall issue and deliver to the persons entitled
thereto a certificate or certificates for the shares of Common Stock
issuable upon conversion and for the shares of Class A Preferred Stock as
promptly as practicable after such conversion is effected.
RESOLVED, that the executive officers of the Company are hereby
authorized and directed to take any and all action necessary to consummate
the transaction contemplated by these resolutions including the execution
of any documents on such terms and conditions as shall be acceptable to
the executive officer in his or her sole discretion with the execution of
the same to be conclusive evidence of such officers approval.
RESOLVED, that this unanimous written consent may be executed in two
or more counterparts, each of which becoming effective when all of which
are executed, and all of which shall constitute one and the same
instrument."
IN WITNESS WHEREOF, this certificate has been made under the seal of
the Corporation and the hands of its President this 4th day of April,
1996.
FOODARAMA SUPERMARKETS, INC.
By:_________________________
Title: President
<PAGE>
EXHIBIT (99)(i)
FLEET BANK, N.A. (as successor to NatWest Bank N.A.), as Lender and as Agent
CHEMICAL BANK, as Lender
IBJ SCHRODER BANK & TRUST COMPANY, as Lender
c/o Fleet Bank, N.A.
175 Water Street
New York, New York 10038
as of May 10, 1996
FOODARAMA SUPERMARKETS, INC.
NEW LINDEN PRICE RITE, INC.
SHOP RITE OF READING, INC.
SHOP RITE OF MALVERNE, INC.
c/o Foodarama Supermarkets, Inc.
922 Highway 33, Suite 1
Freehold, New Jersey 07728
Re:Revolving Credit and Term Loan Agreement dated as of February 15, 1995 (as
amended, restated, modified and supplemented, the "Loan Agreement") among New
Linden Price Rite, Inc. ("New Linden"), Shop Rite of Reading, Inc.
("Reading", and together with New Linden, each a "Borrower" and collectively,
the "Borrowers"), Foodarama Supermarkets, Inc. ("Parent"), the Guarantors
named therein, the Lenders named therein and Fleet Bank, N.A. (as successor to
NatWest Bank N.A.), as Agent
Gentlemen:
Reference is made to the above-captioned Loan Agreement. Pursuant to your
request, each of you and each of the undersigned hereby agrees that clause
(iv) of Section 7.04 of the Loan Agreement shall be amended by deleting such
clause (iv) in its entirety and substituting therefor the following:
"(iv) the Parent may pay (x) during the 1997 Fiscal Year, an aggregate
amount (the "Wakefern Distribution") not in excess of $1,700,000 to Wakefern
Corporation ("Wakefern") in consideration for the repurchase of all of the
preferred stock of Parent owned by Wakefern, provided, however, that the
Wakefern Distribution shall be permitted only if, in the judgment of the
Required Lenders exercised in good faith based upon the Parent's certified
financial statements for the 1996 Fiscal Year, the Parent and their
subsidiaries shall have met or exceeded their projected performance and debt
reduction targets for the 1996 Fiscal Year, as such targets are set forth in
the Parent's financial projections dated August 22, 1994 and as amended on
September 22, 1994 as delivered to the Agent; (y) on or about April 12, 1996,
an amount not in excess of $456,980 in accrued dividends and $34,000 in
current dividends for the quarter ending April 30, 1996, each with respect to
the preferred stock owned by Wakefern; and (z) for each of the three quarters
ending July 31, 1996, October 31, 1996 and January 31, 1997, a dividend of
$34,000 with respect to the preferred stock owned by Wakefern.".
In consideration for the agreement of the undersigned as set forth in this
letter agreement, you hereby agree to deliver to Fleet Bank, N.A., as Agent a
duly and fully executed agreement between Parent and Wakefern Food Corporation
("Wakefern"), such agreement to be substantially in the form of Exhibit A hereto
(the "Wakefern Agreement"). You hereby agree that your failure to deliver the
Wakefern Agreement as aforesaid will, at the option of the Agent, result in an
Event of Default.
Except as expressly amended hereby, all terms and conditions of the Loan
Agreement and all other Loan Documents remain in full force and effect. All
collateral security and guarantees in connection with the Loan Agreement
and/or the Loan Documents are hereby confirmed and ratified.
This letter agreement may be executed in counterparts, each of which shall
constitute an original but all of which when taken together shall constitute
one contract, and shall become effective when copies hereof which, when taken
together, bear the signatures of each of the parties hereto shall be
delivered to the Agent. Delivery of an executed counterpart of a signature
page to this letter agreement by telecopier shall be effective as delivery of
a manually executed signature page hereto.
Capitalized terms used but not defined herein shall have the meaning set
forth in the Loan Agreement.
Very truly yours,
FLEET BANK, N.A.
(as successor to NatWest Bank N.A.),
as Lender and as Agent
By:__________________
Title:
CHEMICAL BANK, as Lender
By:__________________
Title:
IBJ SCHRODER BANK & TRUST COMPANY,
as Lender
By:__________________
Title:
AGREED:
FOODARAMA SUPERMARKETS, INC.
NEW LINDEN PRICE RITE, INC.
SHOP RITE OF READING, INC.
SHOP RITE OF MALVERNE, INC.
By:__________________
Title:
<PAGE>
EXHIBIT (99)(ii)
AGREEMENT, dated as of March 29, 1996, between Foodarama Supermarkets, Inc.,
a New Jersey corporation having an office at Building 6, Suite 1, 922 Highway
33, Freehold, New Jersey 07728 (the "Company") and Wakefern Food Corporation,
a New Jersey corporation having an office at 600 York Street, Elizabeth, New
Jersey 07207-0506 ("Wakefern").
W I T N E S S E T H
WHEREAS, the Company and Wakefern are parties to that certain Securities
Purchase Agreement dated as of February 16, 1993 (the "Securities Purchase
Agreement") pursuant to which the Company issued and sold to Wakefern 136,000
shares of its Class A 8% Cumulative Preferred Stock, $12.50 par value (the
"Preferred Stock");
WHEREAS, resolution of the Board of Directors of the Company setting forth
the terms of the Preferred stock provides that from and after March 31, 1996
the shares of Preferred Stock are convertible, at the option of the holders
thereof, into shares of common stock of the Company;
WHEREAS, the Company has conveyed to Wakefern its desire to postpone the
date that the dividend rate of the Company's Class A Preferred Stock shall
increase by 2% from the third anniversary date of the issuance of such shares to
the fourth anniversary date of the issuances of such shares; and
WHEREAS, the Company and Wakefern set forth their agreement with respect to
Wakefern's right to convert the Preferred Stock into shares of the common
stock of the Company;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, it is agreed as follows:
1. Notwithstanding anything to the contrary set forth in the
Securities Purchase Agreement or in the Resolution of the Company's Board of
Directors establishing the Preferred Stock (the "Resolution"), Wakefern
hereby agrees that it shall not first exercise its right to convert the
Preferred Stock into shares of common stock of the Company until on or after
March 31, 1997.
2. The date on which the dividend rate of the Company's Class A
Preferred Stock shall increase by 2% shall be postponed from the third
anniversary date of the issuance of such shares to the fourth anniversary
date of the issuance of such shares and all subsequent 2% increases shall be
postponed for one (1) year.
3. Except as specifically provided for herein, the Securities Purchase
Agreement, the Resolution and each other agreement and document executed in
connection with the consummation of the transactions contemplated by the
Securities Purchase Agreement shall remain unmodified and in full force and
effect; provided, however, that the Company's Certificate of Incorporation
shall be amended to reflect the amendments to the Class A Preferred Stock
contemplated hereby.
4. This Agreement shall be governed by and construed in accordance
with the laws of the State of New Jersey, without regard to the principles
thereof regarding conflicts of law.
5. This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original and all of which together shall be
deemed to be one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
FOODARAMA SUPERMARKETS, INC.
By:__________________________
Name:________________________
Title:_______________________
WAKEFERN FOOD CORPORATION
By:__________________________
Name:________________________
Title:_______________________
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> NOV-02-1996
<PERIOD-END> APR-27-1996
<CASH> 3,028
<SECURITIES> 0
<RECEIVABLES> 7,068
<ALLOWANCES> (916)
<INVENTORY> 28,490
<CURRENT-ASSETS> 37,670
<PP&E> 95,187
<DEPRECIATION> 47,310
<TOTAL-ASSETS> 105,535
<CURRENT-LIABILITIES> 40,384
<BONDS> 0
1,700
0
<COMMON> 1,622
<OTHER-SE> 27,920
<TOTAL-LIABILITY-AND-EQUITY> 105,535
<SALES> 140,815
<TOTAL-REVENUES> 140,815
<CGS> 105,290
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 34,264
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 668
<INCOME-PRETAX> 593
<INCOME-TAX> 219
<INCOME-CONTINUING> 374
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 374
<EPS-PRIMARY> 131
<EPS-DILUTED> 0
</TABLE>
