UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended June 3, 1995
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from to
Commission file number 1-12454
MORRISON RESTAURANTS INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 63-0475239
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4721 Morrison Drive, Mobile, Alabama 36609
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (334)344-3000
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Name of each exchange
Title of each class on which registered
$0.01 par value Common Stock New York Stock Exchange
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
None
(Title of class)
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.[ ]
The aggregate market value of the voting stock held by non-affiliates
of the Registrant, based upon the closing sale price of Common Stock
on August 4, 1995 as reported on the New York Stock Exchange, was
approximately $621,218,000. Shares of Common Stock held by each
executive officer and director and by each person who owns 5% or more
of the outstanding Common Stock have been excluded in that such
persons may be deemed to be affiliates. This determination of
affiliate status is not necessarily a conclusive determination for
other purposes.
The number of shares of the Registrant's common stock outstanding at
August 4, 1995 was 34,532,900.
DOCUMENTS INCORPORATED BY REFERENCE:
Portions of the Registrant's Annual Report to Stockholders for the
fiscal year ended June 3, 1995 are incorporated by reference into
Parts I and II.
Portions of the Registrant's definitive proxy statement dated August
25, 1995 are incorporated by reference into Part III.
INDEX
PART I
Page
Number
Item 1. Business 4 - 10
Item 2. Properties 11 - 12
Item 3. Legal Proceedings 13
Item 4. Submission of Matters to a Vote of
Security Holders 13
Executive Officers of the Company 14 - 15
PART II
Item 5. Market for the Registrant's Common Equity and
Related Stockholder Matters 16
Item 6. Selected Financial Data 16
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations 16
Item 8. Financial Statements and Supplementary Data 17
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure 17
PART III
Item 10. Directors and Executive Officers of the
Registrant 17
Item 11. Executive Compensation 18
Item 12. Security Ownership of Certain Beneficial
Owners and Management 18
Item 13. Certain Relationships and Related Transactions 18
PART IV
Item 14. Exhibits, Financial Statement Schedules, and
Reports on Form 8-K 19 - 24
PART I
Item 1. Business.
General
Morrison Restaurants Inc. (the "Company"), a Delaware corporation, was
founded in 1920 as a unique cafeteria concept in Mobile, Alabama. In
1928, with just eight cafeterias, the Company had its first and only
public stock offering. The first cash dividend on the common shares
was declared in 1936, and dividends have been paid continuously for 59
years.
During its 75 year history the Company has diversified itself into
various markets of the restaurant and contract-feeding industry. In
April 1982 the Company entered the mid-scale casual dining market by
acquiring Ruby Tuesdays. During the years which followed the Company
added other casual dining concepts, including Mozzarella's Cafe
("Mozzarella's") and L&N Seafood Grill (L&N). At its June 27, 1994
meeting, the Company's Board of Directors approved the plan to phase
out the L&N concept by converting a majority of the L&N units into
other concepts and by selling or closing the remaining locations. In
January, 1995 the Company completed the acquisition of Tia's, a chain
of Tex-Mex restaurants, which allowed the Company to enter one of the
fastest growing segments of the casual dining market.
During the Company's history it also acquired various contract-feeding
companies and combined them with Company-developed contract-feeding
business. In August, 1994 the Company sold certain of its education,
business and industry ("B&I") contracts and assets to concentrate on
management of restaurants and food-service accounts in hospitals and
healthcare facilities. As with L&N, Management believed that B&I was
not likely to become a dominant competitor. B&I accounts not sold
were closed.
Revenues have surpassed one billion dollars for the fourth straight
year in fiscal 1995, thus establishing the Company as one of the
premier restaurant companies in the nation.
Operations
During fiscal 1995, the Company streamlined its business with the
divestiture of L&N and B&I. Its remaining operations are structured
into two primary groups: the Ruby Tuesday Group, comprised of the Ruby
Tuesday Division and the Specialty Division, consisting of
Mozzarella's and Tia's, and the Morrison Group, comprised of the
Health Care Division and the Family Dining Division. Collectively,
the Company operates 798 restaurant operations, consisting of 333
casual dining restaurants and 465 retail and hospital cafeterias and
Fresh Cooking outlets in 37 states and Washington, D.C.
Ruby Tuesday Group:
Ruby Tuesday
Ruby Tuesday's are casual, full-service restaurants with mahogany
woods and whimsical artifacts, classic brass and Tiffany lamps which
create a comfortable, nostalgic look and feel. Ruby Tuesday's menu is
based on variety, with something for just about everyone. Some of
Ruby Tuesday's most popular entree items which are prepared fresh
daily are: fajitas, baby-back ribs, chicken entrees as well as soups,
sandwiches, salad bar, and signature "Tallcake" desserts in Strawberry
and Chocolate-Oreo varieties. Entree selections range in price from
$4.99 to $11.99. Servers are dressed in black pants, starched white
shirts, colorful ties, and white bistro aprons.
Ruby Tuesday, with 275 units, concentrated primarily in the Northeast,
Southeast, Mid-Atlantic and the Midwest, is the group's primary growth
vehicle. The Company intends to open at least 50 additional units in
fiscal 1996 with the majority of these in existing markets. New units
range from 4,250 to 5,200 square feet with seating for 160 to 185
guests. Other than population and traffic volume, site criteria
requirements for new units include annual household incomes ranging
from $30,000 to $50,000, parking for at least 100 vehicles and
accessibility and visibility of location.
Mozzarella's Cafe
Mozzarella's is a Company-developed, full-service restaurant with a
menu that features a variety of pastas and thin-crust gourmet pizzas,
along with made-from-scratch soups, entree salads and sandwiches,
fresh seafood selections, prime steak and grilled chicken all prepared
with signature recipes. Entree selections range in price from $4.99
to $13.99.
Mozzarella's decor is upbeat and colorful with polished wood trim and
paneling, European poster art, strings of overhead lights and tile
floors. Displays of olive oil, tomatoes, pasta and other food
products contribute to the appeal of the restaurant. Servers approach
the guests dressed in white button-down shirts accented with a
colorful bow tie, black trousers and a red bistro apron.
With over 40 Company-owned establishments, Mozzarella's are primarily
located in the Mid-Atlantic and the Southeast with particular
concentration in the Washington, D.C. area, Florida and Virginia. The
Company intends to open only five units in fiscal 1996 to concentrate
on improving the operational efficiency and effectiveness of existing
units. New restaurants typically range from 4,200 to 4,500 square
feet and seat 140 to 160 visitors. Other than visibility and
accessibility of site, potential sites must meet selected traffic and
parking criteria, average annual household incomes greater than
$40,000 and have space available for parking 100 or more automobiles.
Tia's Tex-Mex
Tia's, the newest concept of the Group, is a full-service, casual
dining restaurant. The decor is reminiscent of a grand old Mexican
restaurant with chandeliers replicating those from an old Mexican
hotel, and colors, textures and artifacts that reflect the
restaurants' genuine Southwestern heritage. Tortillas are made by
hand in a display station which contributes to Tia's unique
atmosphere.
Tia's menu items, which are all fresh and made from scratch, include
an array of traditional Tex-Mex favorites such as: fajitas,
enchiladas, tacos, nachos and quesadillas and a selection of unique
grilled and sauteed dishes. The menu also provides the guest with a
variety of appetizers and desserts. Entree items range in price from
$4.50 to $11.95. Chips are cooked fresh throughout the day and served
with just made salsa to every guest. Each guest is greeted by a
casually dressed server wearing a camp shirt, in various colors, with
the Tia's logo, blue jeans and short black aprons.
The Company had 14 Tia's operational at the end of fiscal 1995 and
plans to open at least five units in fiscal 1996. New and existing
units are to be located in the Southwest, Southeast and Mid-Atlantic
regions. New units will have approximately 6100 to 6200 square feet
with seating capacity for 180 visitors. New Tia's restaurants are
considered in areas with annual household incomes from $40,000 to
$50,000, with sites which are visible, accessible and provide at least
125 dedicated parking spaces, and meet certain population and traffic
criteria.
Morrison Group:
Health Care Contracts
The Health Care Division, with 291 accounts, is one of the leading
providers of food and nutrition services to hospitals and healthcare
facilities across America. Accounts range in size from 100 bed
specialty hospitals to facilities with over 2,000 beds.
Morrison has capitalized on its 75 years of expertise in operating
restaurants to bring a retail-oriented mentality to healthcare
clients. Along with managing the food service facilities, the
Division also provides dietary services to some of the largest
hospitals in America.
The Division offers its clients the flexibility to adjust programs,
staffing and service plans to meet the changing needs of the industry.
The Division is divided into ten teams. Each team includes a regional
vice president, nutrition services specialist, culinary specialist,
human resources director, support services coordinator and a director
of business development which are dedicated to sharing the best
industry practices and performance improvement ideas. The regional
teams are supported by a corporate staff that includes nutrition
services, marketing, sales, human resources, legal, finance,
development and culinary services.
Morrison's Family Dining and Fresh Cooking Restaurants
Morrison's Cafeterias serve millions of classic, all-American, freshly
prepared meals every year. Morrison's offers a wide variety of
selections, refreshing salads, home-style entrees, freshly prepared
vegetables, breads, and home-baked pie or other desserts all for a
price ranging from $3.99 to $5.89.
Morrison's Fresh Cooking features many of Morrison's menu selections
along with some new items such as Rotisserie Chicken. Morrison's
Fresh Cooking offers several value meal combinations, as well as
individually priced items such as freshly prepared vegetables and
desserts. Some units feature a take-out shop.
The traditional cafeteria is approximately 10,000 square feet and
seats approximately 250 customers. New cafeterias are being built in
a more contemporary design of approximately 5,500 square feet (Small
Cafeterias) which seat approximately 225 guests. The Small Cafeteria
offers a roadhouse style appearance, with a curved service line which
allows enhanced viewing of the menu items by the customer. The more
decorative dining area, accompanied by booths and wooden tables and
chairs, is set off from the serving line by a short wall for a feeling
of openness. The Company is opening new cafeterias in proven market
areas in the Southeast.
Industry Segments
The information appearing under the caption "Group Information" of the
Registrant's Annual Report to Stockholders for the fiscal year ended
June 3, 1995, and Note 2 of the Notes to Consolidated Financial
Statements included in the Registrant's Annual Report to Stockholders
for the fiscal year ended June 3, 1995 is incorporated herein by
reference.
Research and Development
The Company does not engage in any material research and development
activities. Numerous studies are made, however, on a continuing
basis, to improve menus, equipment, and methods of operations,
including planning for new food-service concepts.
Raw Materials
Raw materials essential to the operation of the Company's business are
obtained from numerous sources but principally from PYA/Monarch under
a cost-plus arrangement. The purchases from PYA/Monarch are in
accordance with the Supply Agreement between the Company and
PYA/Monarch which was entered into on July 8, 1988, in conjunction
with the disposal by the Company of the Morco Industries division. If
PYA/Monarch is unable to meet the Company's supply needs, the Company
negotiates directly with primary suppliers to obtain competitive
prices. The Company uses purchase commitment contracts to stabilize
the potentially volatile pricing associated with certain commodities.
Because of the relatively short storage life of inventories, limited
storage facilities at the restaurants themselves, the Company's
requirement for freshness and the numerous sources of goods, a minimum
amount of inventory is maintained at the units. If necessary, all
essential food, beverage and operational products are available and
can be obtained from alternative suppliers in all cities in which the
Company operates.
Trademarks of the Company
The Company has registered certain trademarks and service marks, with
the United States Patent and Trademark Office; "Morrison's", "Ruby
Tuesday", "Mozzarella's", and "Tia's" are four such marks. The
Company believes that these and other related marks are of material
importance to the Company's business. Registrations of the trademarks
listed above expire from 2004 to 2005, unless renewed. In addition to
the marks listed above, approval is pending for the mark of
"Morrison's Fresh Cooking" by the Company.
Seasonality
The Company's business is moderately seasonal. Average restaurant
sales of the Company are slightly higher during the winter months than
during the summer months.
Working Capital Practices
Cash provided by operations, along with borrowings under the Company's
revolving line of credit, are invested in new unit expansion and the
renovation of existing units. Cash available during the year is used
to repurchase shares of the Company's common stock.
Additional information concerning the working capital of the Company
is incorporated herein by reference to information presented within
the "Liquidity and Capital Resources" section of "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" of the Company's 1995 Annual Report to Stockholders.
Customer Dependence
No material part of the business of the Company is dependent upon a
single customer, or a very few customers, the loss of any one of which
would have a material adverse effect on the Company.
Competition
The Company's activities in the restaurant industry are subject to
vigorous competition relating to restaurant location and service, as
well as quality, variety and value perception of the food products
offered. The Company is in competition with other food service
operations, with locally-owned operations as well as national and
regional chains that offer the same type of services and products as
the Company.
Government Compliance
The Company is subject to various licensing and regulations at both
the state and local levels for items such as zoning, land use,
sanitation, alcoholic beverage control, health and fire safety all of
which could delay the opening of a new restaurant or the operation of
an existing unit. The Company's business is subject to various other
regulations at the federal level such as health care, minimum wage,
and fair labor standards. Compliance with these regulations has not
had, and is not expected to have, a material adverse effect on the
Company's operations.
There is no material portion of the Company's business that is subject
to renegotiation of profits or termination of contracts or
sub-contracts at the election of the Government.
Environmental Compliance
Compliance with federal, state and local laws and regulations which
have been enacted or adopted regulating the discharge of materials
into the environment, or otherwise relating to the protection of the
environment, is not expected to have a material effect upon the
capital expenditures, earnings or competitive position of the Company.
Personnel
The Company employs approximately 36,000 full-time and part-time
employees. The Company believes that working conditions are favorable
and employee compensation is comparable with its competition.
International Operations
All of Company-owned operations are located within the United States. On
March 30, 1995 the Company entered into a development agreement (the
"Agreement") with Jardine Pacific Restaurants Group Limited (the
"Developer") to open a minimum of eight, 20, and 38 Ruby Tuesday
restaurants in the Asia-Pacific region by the end of the third, sixth,
and tenth anniversaries of the date of the Agreement, respectively.
Under the terms of the Agreement the Company is to receive a licensing
fee on the first seven Ruby Tuesday restaurants opened by the Developer
in the Asia-Pacific region and royalties, from all units, derived as
applicable, from sales or profits as defined in the Agreement. The
Company does not expect this Agreement to have a material effect on
future operations, nor is it currently engaged in material operations in
foreign countries.
Item 2. Properties.
Information regarding the locations of the Company's Ruby Tuesday
Group and Morrison Group (retail and hospital cafeterias) operations
is shown in the list below. Of the 507 Company-operated restaurants
(Ruby Tuesday Group and retail cafeteria operations), the Company
owned the building and held long-term land leases for 61 restaurants,
owned the land and building for 38 restaurants, held leases covering
land and building for 407 restaurants and owned the land and leased
the building for one unit. The nature of the Health Care Division of
the Morrison Group is professionally managing food and related service
systems on client-owned property. Vending services on client-owned
facilities complement this program. Initial lease terms expire at
various dates over the next 24 years and may provide for escalation of
rents during the lease terms. Most of these leases provide for
additional contingent rents based upon sales volume and contain
options to renew (at adjusted rentals for some leases). The Company
has a policy to remodel units as needed. Facilities and equipment are
repaired and maintained to assure their adequacy, productive capacity
and utilization. Except for certain administrative support of the
Morrison Group, the administrative personnel of the Company are
located in the executive and administrative headquarters building
located in Mobile, Alabama. The administrative headquarters has a
lease term ending in 1998 and provides an option to purchase at a
nominal amount at the end of the initial lease term. This building
was financed through the sale of Industrial Development Revenue Bonds
from the Industrial Development Board of the City of Mobile, Alabama.
The administrative personnel of the Morrison Group are located in
Atlanta, Georgia in approximately 20,000 square feet of a leased
building.
Additional information concerning the properties of the Company and
the lease obligations of the Company and its subsidiaries is
incorporated herein by reference to Note 8 of the Notes to
Consolidated Financial Statements included in the Annual Report to
Stockholders for the fiscal year ended June 3, 1995.
Item 2. Properties (continued)
Information regarding the location by state and the number of the
Company's Ruby Tuesday and Morrison Group operations is shown below.
<TABLE>
<CAPTION>
Ruby Ruby
Tuesday Morrison Tuesday Morrison
State Group Group State Group Group
<S> <C> <C> <S> <C> <C>
Alabama 16 48 Minnesota 3
Arkansas 3 1 Mississippi 5 20
Arizona 2 9 Missouri 4 15
California 29 Nebraska 2
Colorado 1 2 New Hampshire 1
Connecticut 6 2 New Jersey 8 4
District of New York 23 7
Columbia 1 3
North Carolina 6 9
Delaware 3 1
Ohio 12 14
Florida 51 78
Oklahoma 2
Georgia 35 46
Pennsylvania 16 17
Illinois 9 8
Rhode Island 1
Indiana 4 5
South Carolina 7 17
Iowa 1
Tennessee 23 25
Kentucky 5 16
Texas 12 20
Louisiana 3 8
Vermont 1
Maine 1 5
Virginia 36 27
Maryland 14 11
West Virginia 4
Massachusetts 4 6
Wisconsin 2
Michigan 14 4
</TABLE>
Item 3. Legal Proceedings.
The Company is presently, and from time to time, subject to pending
claims and suits arising in the ordinary course of its business. In
the opinion of Management, the ultimate resolution of these pending
legal proceedings will not have a material adverse effect on the
Company's operations or consolidated financial position.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Executive Officers of the Company.
Executive officers of the Company are appointed by and serve at the
discretion of the Company's Board of Directors. Information regarding
the Company's executive officers as of August 4, 1995 is provided
below.
<TABLE>
<CAPTION>
Executive
Officer
Name Age Position with the Company Since
<S> <C> <S> <C>
S. E. Beall, III 45 Chief Executive Officer 1982
R. D. McClenagan 47 President, 1985
Ruby Tuesday Division
R. L. Tatum 55 President, 1993
Family Dining Division
P. G. Hunt 59 Senior Vice President, 1972
General Counsel and
Secretary
J. R. Mothershed 47 Senior Vice President, 1992
Finance
R. Vilord 59 Senior Vice President, 1993
Human Resources
A. R. Johnson 43 President, Specialty 1993
Division
G. Davenport 41 President, Morrison's 1994
Health Care Division
</TABLE>
Mr. Beall was elected Chief Executive Officer and Chairman of
the Board effective May 5, 1995. Mr. Beall served as
President and Chief Executive Officer from June 6, 1992 to May
4, 1995 and as President and Chief Operating Officer from
September, 1986 to June, 1992.
Mr. McClenagan was appointed President of the Ruby Tuesday
Division in March, 1994. He served as President of the Ruby
Tuesday Group from April, 1990 to March, 1994 and as Senior
Vice President of the Specialty Restaurant Division from
March, 1985 to April, 1990.
Mr. Tatum was appointed President of the Family Dining
Division in March, 1994. Previously, he was Senior Vice
President of Morrison's Family Dining Group and was appointed
President of Morrison's Family Dining Group in March, 1993.
Mr. Hunt joined the Company in June, 1968 and was named Senior
Vice President, General Counsel and Secretary in September,
1985. From December, 1984, to September, 1985, he served as
Vice President, General Counsel and Secretary.
Mr. Mothershed joined the Company in July, 1972 and was named
Senior Vice President, Finance in March, 1994. He served as
Vice President, Controller and Treasurer from March, 1989
until March, 1994.
Mr. Vilord joined the Company in April, 1988 and was named
Senior Vice President of Human Resources in June, 1993. He
served as Vice President of Purchasing from October, 1989
until June, 1993.
Mr. Johnson was named President, Specialty Division in March,
1994. Prior thereto, he served as Senior Vice President,
Marketing from June, 1993 to March, 1994 and as Vice
President, Marketing of the Ruby Tuesday Group from November,
1992 to June, 1993. Prior to joining the Company in November,
1992, Mr. Johnson was a consultant to the Ruby Tuesday Group.
Mr. Davenport joined the Company in November, 1973 and was
appointed President of the Health Care Division in November,
1993. Previously, he served as Regional Vice President of the
Hospitality Group and was promoted to Senior Vice President,
Hospitality Group in February, 1990.
PART II
Item 5. Market for the Registrant's Common Equity and Related
Stockholder Matters.
Certain information required by this item is incorporated herein
by reference to Note 15 of the Notes to Consolidated Financial
Statements of the Registrant's Annual Report to Stockholders for
the fiscal year ended June 3, 1995.
Under various financing agreements, the Company has agreed to
restrict dividend payments (other than stock dividends) and
purchases of its capital stock to amounts (collectively,
"Restricted Payments") based on earnings after fiscal year 1994.
Specifically, the maximum amount available for Restricted
Payments at any time is an amount equal to the sum of
$175,000,000 plus 50% (or minus 100% in the case of a deficit) of
Consolidated Net Earnings for the period commencing on June 5,
1994, and terminating at the end of the last fiscal quarter
preceding the date of any proposed Restricted Payment. At June 3,
1995, the maximum amount of permissible Restricted Payments was
$39,407,000.
Item 6. Selected Financial Data.
The information contained under the caption "Summary of
Operations" of the Registrant's Annual Report to Stockholders for
the fiscal year ended June 3, 1995 is incorporated herein by
reference. See also the information relating to the sale of B&I
contracts and assets under the caption "Management's Discussion
and Analysis of Financial Condition and Results of Operations"
of the Registrant's Annual Report to Stockholders for the fiscal
year ended June 3, 1995 for factors that effect the comparability
of the information reflected in selected financial data.
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
The information contained under the caption "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" of the Registrant's Annual Report to Stockholders for
the fiscal year ended June 3, 1995 is incorporated herein by
reference.
Item 8. Financial Statements and Supplementary Data.
The following consolidated financial statements and the related
report of the Company's independent auditors contained in the
Registrant's Annual Report to Stockholders for the fiscal year
ended June 3, 1995, are incorporated herein by reference:
Consolidated Statements of Income - Fiscal years ended
June 3, 1995, June 4, 1994 and June 5, 1993.
Consolidated Balance Sheets - As of June 3, 1995 and June 4,
1994.
Consolidated Statements of Stockholders' Equity - Fiscal
years ended June 3, 1995, June 4, 1994 and June 5, 1993.
Consolidated Statements of Cash Flows - Fiscal years ended
June 3, 1995, June 4, 1994 and June 5, 1993.
Notes to Consolidated Financial Statements.
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.
None.
PART III
Item 10. Directors and Executive Officers of the Company.
(a) The information regarding directors of the Company is
incorporated herein by reference to the information set forth in
the table captioned "Director and Director Nominee Information"
under "Election of Directors" in the definitive proxy statement
of the Registrant dated August 25, 1995, relating to the
Registrant's annual meeting of stockholders to be held on
September 27, 1995.
(b) Pursuant to Form 10-K General Instruction G(3), the
information regarding executive officers of the Company has been
included in Part I of this Report under the caption "Executive
Officers of the Company".
Item 11. Executive Compensation.
The information required by this Item 11 is incorporated herein
by reference to the information set forth under the captions
"Executive Compensation" and "Election of Directors - Directors'
Fees and Attendance" in the definitive proxy statement of the
Registrant dated August 25, 1995 relating to the Registrant`s
annual meeting of stockholders to be held on September 27, 1995.
Item 12. Security Ownership of Certain Beneficial Owners and
Management.
The information required by this Item 12 is incorporated herein
by reference to the information set forth in the table captioned
"Beneficial Ownership of Common Stock" under "Election of
Directors" in the definitive proxy statement of the Registrant
dated August 25, 1995, relating to the Registrant's annual
meeting of stockholders to be held on September 27, 1995.
Item 13. Certain Relationships and Related Transactions.
The information required by this Item 13 is incorporated herein
by reference to the information set forth under the caption
"Certain Transactions" in the definitive proxy statement of the
Registrant dated August 25, 1995, relating to the Registrant's
annual meeting of stockholders to be held on September 27, 1995.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and
Reports on Form 8-K.
(a) The following documents are incorporated by reference into
or are filed as a part of this report:
1. Financial Statements:
The following consolidated financial statements and the
independent auditors' report thereon, included in the
Registrant's Annual Report to Stockholders for the fiscal
year ended June 3, 1995, a copy of which is contained in
the exhibits to this report, are incorporated herein by
reference:
Page Reference
in paper version
of Annual Report
to Shareholders
Consolidated Statements of Income for
the fiscal years ended June 3, 1995,
June 4, 1994 and June 5, 1993 36
Consolidated Balance Sheets as of
June 3, 1995 and June 4, 1994 37
Consolidated Statements of Stockholders'
Equity for the fiscal years ended
June 3, 1995, June 4, 1994 and
June 5, 1993 38
Consolidated Statements of Cash Flows
for the fiscal years ended June 3, 1995,
June 4, 1994 and June 5, 1993 39
Notes to Consolidated Financial Statements 40 - 47
Report of Independent Auditors 48
2. Financial statement schedules:
Report of Independent Auditors 23
Schedule II - Valuation and Qualifying
Accounts for the fiscal years ended June 3,
1995, June 4, 1994 and June 5, 1993 27
Financial statement schedules other than those shown above are omitted
because they are either not required or the required information is shown
in the financial statements or notes thereto.
3. Exhibits
The following exhibits are filed as part of this report:
<TABLE>
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
LIST OF EXHIBITS
<CAPTION>
Exhibit
Number Description
<C> <S>
3(a) Certificate of Incorporation as amended.
3(b) Bylaws as restated and amended.
4(a) Reference is made to Articles IV, V, VII, and X of the Certificate
of Incorporation and Articles II, VI, VIII, IX and XIII of the
Bylaws incorporated by reference as Exhibits 3(a) and 3(b) hereto,
respectively.
4(b) Rights Agreement.(6)
10(a) Executive Supplemental Pension Plan together with First Amendment
made June 30, 1994 and Second Amendment made July 31, 1995.*
10(b) Morrison Restaurants Inc. Stock Incentive Plan.*(2)
10(c) Morrison Restaurants Inc. Stock Incentive and Deferred Compensation
Plan for Directors together with first amendment dated June 29,
1995.*
10(d) 1993 Executive Stock Option Program.*(2)
10(e) 1993 Management Stock Option Program (July 1, 1993 - June 30,
1996).*(2)
10(f) Morrison Restaurants Inc. Long-Term Incentive Plan.*(7)
10(g) Morrison Restaurants Inc. 1987 Stock Bonus and Non-Qualified Stock
Option Plan, and Related Agreement.*(8)
<CAPTION>
Exhibit
Number Description
<C> <S>
10(h) Morrison Restaurants Inc. 1993 Non-Executive Stock Incentive
Plan.*(2)
10(i) Morrison Restaurants Inc. Deferred Compensation Plan, as restated
effective January 1, 1994 together with amended and restated Trust
Agreement (dated December 1, 1992) to the Deferred Compensation
Plan.*
10(j) Credit Agreement dated as of September 30, 1994 among Morrison
Restaurants Inc., Trust Company Bank as Agent and Administrative
Agent and the cap lender named on the signature pages thereto,
together with forms of cap revolving cap credit cap note, Money
Market Note, and Subsidiary Guaranty Cap Agreement.(11)
10(k) Stock Purchase Agreement dated as of January 16, 1995 by and among
the Registrant and certain stockholders of Tias, Inc. listed on the
signature pages thereto.(10)
10(l) Intentionally omitted
10(m) Supply Agreement between Morrison Restaurants Inc. and PYA/Monarch,
Inc.(5)
10(n) Morrison Restaurants Inc. Management Retirement Plan together with
First Amendment made June 30, 1994 and Second Amendment made July
31, 1995.*
10(o) Asset Purchase Agreement dated June 27, 1994, by and among Morrison
Restaurants Inc. and Gardner Merchant Food Services, Inc. and the
related exhibits to such agreement.(9)
10(p) Morrison Restaurants Inc. Salary Deferral Plan as amended and
restated December 31, 1993 together with amended and restated Trust
Agreement (effective January 1, 1994) First and Second Amendments to
the Plan dated October 21, 1994 and June 30, 1995, respectively and
the First Amendment to the Trust Agreement made June 30, 1995.*
10(q) Executive Group Life and Executive Accidental Death and
Dismemberment Plan.*(4)
10(r) Form of Morrison Restaurants Inc. Change of Control Agreement
entered into with S.E. Beall, III, G.A. Davenport, P.G. Hunt, A.R.
Johnson, R.D. McClenagan, J.R. Mothershed, R.L. Tatum and R.
Vilord.*(3)
10(s) Non-Qualified Option Agreement between the Company and Mr. E.E.
Bishop, dated January 30, 1987.*(3)
<CAPTION>
Exhibit
Number Description
<C> <S>
10(t) Non-Qualified Option Agreement between the Company and Mr. S.E.
Beall, III dated January 30, 1987.*(3)
10(u) Intentionally omitted.
10(v) Form of Non-Qualified Stock Option Agreement for Executive Officers
Pursuant to the Morrison Restaurants Inc. Stock Incentive Plan.*(2)
10(w) Loan Agreement between Morrison Restaurants Inc. and Tias, Inc.
dated November 19, 1993 together with notes dated November 19,
1993.(1)
10(x) First Amendment to Morrison Restaurants Inc. Stock Incentive
Plan.*(1)
10(y) First Amendment to Morrison Restaurants Inc. Long-Term Incentive
Plan.*(1)
10(z) Amendments to Morrison Restaurants Inc. 1987 Stock Bonus and Non-
Qualified Stock Option Plan.*(1)
10(a)(a) Morrison Restaurants Inc. Executive Life Insurance Plan.*(1)
10(b)(b) Performance Stock Rights Agreement dated July 1, 1993 between the
Company and S. E. Beall.*(1)
10(c)(c) Letter agreement dated May 20, 1994 between the Company and J. B.
Byrum relating to severance, salary continuation and commission
arrangements.(1)
10(d)(d) Stock Purchase Agreement dated June 3, 1994 between Custom
Management Corporation, a wholly-owned subsidiary of the Company
("CMC"), and J. B. Byrum relating to the sale of the Company's 35%
equity interest in Morrison-Crothall Support Services, Inc. together
with promissory note in the principal amount of $400,000, Guarantee
and Stock Pledge Agreement.(1)
11 Statement regarding computation of per share earnings.
13 Annual Report to Shareholders for the fiscal year ended June 5, 1993
(Only portions specifically incorporated by reference in the Form
10-K are being filed herewith).
21 Subsidiaries of Registrant.
23 Consent of Independent Auditors.
27 Financial Data Schedule
</TABLE>
<TABLE>
MORRISON RESTAURANTS INC.
EXHIBIT FOOTNOTES
<CAPTION>
Exhibit
Footnote Description
<C> <S>
* Management contract or compensatory plan or arrangement.
(1) Incorporated by reference to Exhibit of the same number in the
Registrant's Annual Report on Form 10-K for the fiscal year ended
June 4, 1994.
(2) Incorporated by reference to Exhibit of the same number in the
Registrant's Annual Report on Form 10-K for the fiscal year ended
June 5, 1993.
(3) Incorporated by reference to Exhibit of the same number in the
Registrant's Annual Report on Form 10-K for the fiscal year ended
June 2, 1990.
(4) Incorporated by reference to Exhibit of the same number in the
Registrant's Annual Report on Form 10-K for the fiscal year ended
June 3, 1989.
(5) Incorporated by reference to Exhibit of the same number in the
Registrant's Annual Report on Form 10-K for the fiscal year ended
May 28, 1988.
(6) Incorporated by reference to Exhibit 4.1 to the Registrant's
Quarterly Report on Form 10-Q for the fiscal quarter ended February
28, 1987.
(7) Incorporated by reference to Exhibit 28 of the Registrant's
Registration Statement No. 2-97120 on Form S-8.
(8) Incorporated by reference to Exhibit 28.1 of the Registrant's
Registration Statement No. 33-13593 on Form S-8.
(9) Incorporated by reference to Exhibit (2) in the Registrant's Form
8-K dated July 27, 1994.
(10) Incorporated by reference to Exhibit (2) in the Registrant's Form
8-K dated January 17, 1995.
(11) Incorporated by reference to Exhibit of the same number in the
Registrant's Report on Form 10-Q for the fiscal quarter ended
December 3, 1994.
(b) The Registrant filed no reports on Form 8-K during the last
quarter of the period covered by this report.
(c) Exhibits filed with this report are attached hereto.
(d) The financial statement schedules listed in subsection
(a) (2) above are attached hereto.
</TABLE>
<TABLE>
SCHEDULE II
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS
FOR THE FISCAL YEARS ENDED JUNE 3, 1995, JUNE 4, 1994 AND JUNE 5, 1993
(DOLLARS IN THOUSANDS)
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
ADDITIONS
(A)
BALANCE AT CHARGED TO CHARGED BALANCE AT
BEGINNING COSTS AND TO OTHER END
DESCRIPTION OF PERIOD EXPENSES ACCOUNTS DEDUCTIONS OF PERIOD
<S> <C> <C> <C> <C> <C>
YEAR ENDED JUNE 3, 1995:
Trade receivables:
Allowance for doubtful accounts........ $ 2,622 $ 0 $ 0 $ 981 $ 1,641
YEAR ENDED JUNE 4, 1994:
Trade receivables:
Allowance for doubtful accounts........ $ 3,087 $ 4 $ 0 $ 469 $ 2,622
YEAR ENDED JUNE 5, 1993:
Trade receivables:
Allowance for doubtful accounts........ $ 3,021 $ 551 $ 0 $ 485 $ 3,087
Notes:
(A) Write-off of trade receivables determined to be uncollectible against the allowance for doubtful
accounts.
</TABLE>
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.
MORRISON RESTAURANTS INC.
Date 08/28/95 By:/s/ Samuel E. Beall, III
Samuel E. Beall, III
Chief Executive Officer
and Chairman of the Board
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of the Registrant and in the capacities and on the dates
indicated:
Date 08/28/95 By:/s/ Samuel E. Beall, III
Samuel E. Beall, III
Chief Executive Officer
and Chairman of the Board
Date 08/28/95 By:/s/ J. Russell Mothershed
J. Russell Mothershed
Senior Vice President, Finance
(Principal Accounting Officer)
Date 08/28/95 By:/s/ Wallace R. Bunn
Wallace R. Bunn
Director
Date 08/28/95 By:/s/ J. B. McKinnon
J. B. McKinnon
Director
Date 08/28/95 By:/s/ Donald Ratajczak
Dr. Donald Ratajczak
Director
Date 08/28/95 By:/s/ Dolph W. von Arx
Dolph W. von Arx
Director
Date
Claire L. Arnold
Director
Date
E. E. Bishop
Director
Date
Arthur R. Outlaw
Vice-Chairman of the Board
Date
Dr. Benjamin F. Payton
Director
<TABLE>
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
LIST OF EXHIBITS
<CAPTION>
Exhibit
Number Description
<C> <S>
3(a) Certificate of Incorporation as amended.
3(b) Bylaws as restated and amended.
4(a) Reference is made to Articles IV, V, VII, and X of the Certificate of
Incorporation and Articles II, VI, VIII, IX and XIII of the Bylaws
incorporated by reference as Exhibits 3(a) and 3(b) hereto,
respectively.
4(b) Rights Agreement.(6)
10(a) Executive Supplemental Pension Plan together with First Amendment made
June 30, 1994 and Second Amendment made July 31, 1995.*
10(b) Morrison Restaurants Inc. Stock Incentive Plan.*(2)
10(c) Morrison Restaurants Inc. Stock Incentive and Deferred Compensation
Plan for Directors together with first amendment dated June 29, 1995.*
10(d) 1993 Executive Stock Option Program.*(2)
10(e) 1993 Management Stock Option Program (July 1, 1993 - June 30,
1996).*(2)
10(f) Morrison Restaurants Inc. Long-Term Incentive Plan.*(7)
10(g) Morrison Restaurants Inc. 1987 Stock Bonus and Non-Qualified Stock
Option Plan, and Related Agreement.*(8)
10(h) Morrison Restaurants Inc. 1993 Non-Executive Stock Incentive Plan.*(2)
10(i) Morrison Restaurants Inc. Deferred Compensation Plan, as restated
effective January 1, 1994 together with amended and restated Trust
Agreement (dated December 1, 1992) to the Deferred Compensation Plan.*
10(j) Credit Agreement dated as of September 30, 1994 among Morrison
Restaurants Inc., Trust Company Bank as Agent and Administrative Agent
and the cap lender named on the signature pages thereto, together with
forms of cap revolving cap credit cap note, Money Market Note, and
Subsidiary Guaranty Cap Agreement.(11)
10(k) Stock Purchase Agreement dated as of January 16, 1995 by and among the
Registrant and certain stockholders of Tias, Inc. listed on the
signature pages thereto.(10)
<CAPTION>
Exhibit
Number Description
<C> <S>
10(l) Intentionally omitted
10(m) Supply Agreement between Morrison Restaurants Inc. and PYA/Monarch,
Inc.(5)
10(n) Morrison Restaurants Inc. Management Retirement Plan together with
First Amendment made June 30, 1994 and Second Amendment made July 31,
1995.*
10(o) Asset Purchase Agreement dated June 27, 1994, by and among Morrison
Restaurants Inc. and Gardner Merchant Food Services, Inc. and the
related exhibits to such agreement.(9)
10(p) Morrison Restaurants Inc. Salary Deferral Plan as amended and restated
December 31, 1993 together with amended and restated Trust Agreement
(effective January 1, 1994) First and Second Amendments to the Plan
dated October 21, 1994 and June 30, 1995, respectively and the First
Amendment to the Trust Agreement made June 30, 1995.*
10(q) Executive Group Life and Executive Accidental Death and Dismemberment
Plan.*(4)
10(r) Form of Morrison Restaurants Inc. Change of Control Agreement entered
into with S.E. Beall, III, G.A. Davenport, P.G. Hunt, A.R. Johnson,
R.D. McClenagan, J.R. Mothershed, R.L. Tatum and R. Vilord.*(3)
10(s) Non-Qualified Option Agreement between the Company and Mr. E.E.
Bishop, dated January 30, 1987.*(3)
10(t) Non-Qualified Option Agreement between the Company and Mr. S.E. Beall,
III dated January 30, 1987.*(3)
10(u) Intentionally omitted.
10(v) Form of Non-Qualified Stock Option Agreement for Executive Officers
Pursuant to the Morrison Restaurants Inc. Stock Incentive Plan.*(2)
10(w) Loan Agreement between Morrison Restaurants Inc. and Tias, Inc. dated
November 19, 1993 together with notes dated November 19, 1993.(1)
10(x) First Amendment to Morrison Restaurants Inc. Stock Incentive Plan.*(1)
10(y) First Amendment to Morrison Restaurants Inc. Long-Term Incentive
Plan.*(1)
10(z) Amendments to Morrison Restaurants Inc. 1987 Stock Bonus and Non-
Qualified Stock Option Plan.*(1)
<CAPTION>
Exhibit
Number Description
<C> <S>
10(a)(a) Morrison Restaurants Inc. Executive Life Insurance Plan.*(1)
10(b)(b) Performance Stock Rights Agreement dated July 1, 1993
between the Company and S. E. Beall.*(1)
10(c)(c) Letter agreement dated May 20, 1994 between the Company and
J. B. Byrum relating to severance, salary continuation and
commission arrangements.(1)
10(d)(d) Stock Purchase Agreement dated June 3, 1994 between Custom
Management Corporation, a wholly-owned subsidiary of the
Company ("CMC"), and J. B. Byrum relating to the sale of the
Company's 35% equity interest in Morrison-Crothall Support
Services, Inc. together with promissory note in the
principal amount of $400,000, Guarantee and Stock Pledge
Agreement.(1)
11 Statement regarding computation of per share earnings.
13 Annual Report to Shareholders for the fiscal year ended June
5, 1993 (Only portions specifically incorporated by
reference in the Form 10-K are being filed herewith).
21 Subsidiaries of Registrant.
23 Consent of Independent Auditors.
27 Financial Data Schedule
</TABLE>
<TABLE>
MORRISON RESTAURANTS INC.
EXHIBIT FOOTNOTES
<CAPTION>
Exhibit
Footnote Description
<C> <S>
* Management contract or compensatory plan or arrangement.
(1) Incorporated by reference to Exhibit of the same number in the
Registrant's Annual Report on Form 10-K for the fiscal year ended
June 4, 1994.
(2) Incorporated by reference to Exhibit of the same number in the
Registrant's Annual Report on Form 10-K for the fiscal year ended
June 5, 1993.
(3) Incorporated by reference to Exhibit of the same number in the
Registrant's Annual Report on Form 10-K for the fiscal year ended
June 2, 1990.
(4) Incorporated by reference to Exhibit of the same number in the
Registrant's Annual Report on Form 10-K for the fiscal year ended
June 3, 1989.
(5) Incorporated by reference to Exhibit of the same number in the
Registrant's Annual Report on Form 10-K for the fiscal year ended
May 28, 1988.
(6) Incorporated by reference to Exhibit 4.1 to the Registrant's Quarterly
Report on Form 10-Q for the fiscal quarter ended February 28, 1987.
(7) Incorporated by reference to Exhibit 28 of the Registrant's
Registration Statement No. 2-97120 on Form S-8.
(8) Incorporated by reference to Exhibit 28.1 of the Registrant's
Registration Statement No. 33-13593 on Form S-8.
(9) Incorporated by reference to Exhibit (2) in the Registrant's Form 8-K
dated July 27, 1994.
(10) Incorporated by reference to Exhibit (2) in the Registrant's Form 8-K
dated January 17, 1995.
(11) Incorporated by reference to Exhibit of the same number in the
Registrant's Report on Form 10-Q for the fiscal quarter ended December
3, 1994.
</TABLE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
MORRISON RESTAURANTS INC.
Morrison Restaurants Inc., a corporation organized and existing under
and by virtue of the General Corporation Law of the State of Delaware (the
"Corporation"), does hereby certify:
FIRST: That a meeting of the Board of Directors of the Corporation duly
called and held, resolutions were duly adopted setting forth a proposed
amendment to the Certificate of Incorporation of the Corporation, declaring
said amendment to be advisable and calling a meeting of the stockholders of
said corporation for consideration thereof. The resolution setting forth the
proposed amendment is as follows:
RESOLVED, that Article IV of the Certificate of Incorporation be,
and it hereby is, amended by deleting paragraph (a) thereof in its
entirety and substituting the following in lieu thereof:
(a) The total number of shares of capital stock which the
Corporation shall have authority to issue is One Hundred Million Two
Hundred Fifty Thousand (100,250,000), divided into two classes as
follows:
(1) One Hundred Million (100,000,000) shares of common
stock, $.01 par value per share ("Common Stock"); and
(2) Two Hundred Fifty Thousand (250,000) shares of
preferred stock, $.01 par value per share ("Preferred Stock").
SECOND: That thereafter, pursuant to resolution of its Board of
Directors, the Stockholders of the Corporation, at their annual meeting held
on September 28, 1994, adopted the proposed amendment by voting the necessary
number of shares as required by statute in favor of the amendment.
THIRD: That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware and this Certificate of Amendment shall be effective upon its filing
date.
IN WITNESS WHEREOF, MORRISON RESTAURANTS INC. has caused this
certificate to be signed by its duly authorized officer, this 28th day of
September, 1994.
MORRISON RESTAURANTS INC.
By: /s/ Pfilip G. Hunt
Title: Secretary and General Counsel
CERTIFICATE OF DESIGNATION
OF
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
MORRISON RESTAURANTS INC.
Pursuant to Section 151 of the
General Corporation Law of Delaware
I, Samuel E. Beall, III, Chief Executive Office of Morrison Restaurants
Inc., a corporation organized and existing under the General Corporation Law
of Delaware (the "Corporation"), in accordance with the provisions of Section
151 of the General Corporation Law of the State of Delaware, DO HEREBY
CERTIFY:
That pursuant to authority conferred upon the Board of Directors of the
Corporation (the "Board of Directors") by the Certificate of Incorporation of
the Corporation (the "Certificate of Incorporation"), the Board of Directors,
at a meeting duly called and held on October 1, 1992, adopted a resolution
providing for the filing of a Certificate of Designation with the Secretary
of the State of Delaware, which resolution is as follows:
WHEREAS, Morrison Incorporated, a Florida corporation ("Morrison-
Florida") entered into a certain Rights Agreement with AmSouth Bank, National
Association, dated March 30, 1987 (the "Shareholder Rights Plan"); and
WHEREAS, to fulfill its obligations under the Shareholder Rights Plan,
Morrison-Florida authorized the creation of a series of the preferred stock
of Morrison-Florida, no par value (the "Morrison-Florida Preferred Stock") to
be designated Series A Junior Participating Preferred Stock ("Series A
Preferred Stock"); and
WHEREAS, Morrison-Florida filed a Certificate of Designation with the
Secretary of the State of Florida on April 6, 1987, designating 30,000 shares
of the Preferred Stock as Series A Preferred Stock; and
WHEREAS, in order to change the Corporation's state of incorporation
from Florida to Delaware, Morrison-Florida entered into an Agreement and Plan
of Merger as of August 26, 1987 (the "Merger"); and
WHEREAS, pursuant to Section 2.1(e) of the Merger, those Rights governed
by the Shareholder Rights Plan to purchase shares of Preferred Stock from
Morrison-Florida and to sell shares of Common Stock to Morrison-Florida, under
certain circumstances and pursuant to the Shareholder Rights Plan, were, by
virtue of the Merger and without further action on the part of the holder of
any Right or any other person, converted into and exchanged for Rights to
purchase shares of the Corporation's preferred stock, $.01 par value, (the
"Preferred Stock") from the Corporation and to sell shares of the
Corporation's Common Stock to the Corporation or other parties, at the same
price per share, and pursuant to, and subject to the conditions set forth in,
the Shareholder Rights Plan in effect as of the effective date of the Merger;
and
WHEREAS, the Corporation has not yet filed a Certificate of Designation
to designate the Series A Preferred Stock in the State of Delaware; and
WHEREAS, the Corporation has issued additional shares of the Common
Stock pursuant to the payment of a stock dividend, thereby issuing additional
Rights pursuant to the Shareholders Rights Agreement; and
WHEREAS, upon the occurrence of an event triggering the right of holders
of Rights to exchange their rights for Series A Preferred Stock, the
Corporation would need more than the 30,000 shares of Series A Preferred Stock
designated under the Certificate of Designations filed in Florida; and
WHEREAS, pursuant to Article IV of the Certificate of Incorporation,
the Corporation is authorized to issue up to 250,000 shares of Preferred
Stock, to be issued from time to time in one or more series;
NOW, THEREFORE, LET IT BE RESOLVED, that pursuant to the authority
granted to and vested in the Board of Directors in accordance with the
provisions of the Certificate of Incorporation, the Board of Directors hereby
authorizes the Corporation to file with the Secretary of the State of Delaware
a Certificate of Designation which states the designation and number of
shares, and fixes the relative rights, preferences, and limitations of the
Series A Preferred Stock in substantially the same form as the Certificate of
Designations filed with the Secretary of the State of Florida on April 6,
1987, except that a total of 50,000 shares of Preferred Stock shall be
designated as Series A Preferred Stock, and whose other terms shall be as
follows:
Series A Junior Participating Preferred Stock:
I. Designation and Amount
The shares of such series shall be designated as "Series A Junior
Participating Preferred Stock" (the "Series A Preferred Stock") and the number
of shares constituting the Series A Preferred Stock shall be 50,000. Such
number of shares may be increased or decreased by resolution of the Board of
Directors; provided, that no decrease shall reduce the number of shares of
Series A Preferred Stock to a number less than the number of shares then
outstanding plus the number of shares reserved for issuance upon the exercise
of outstanding options, rights or warrants or upon the conversion of any
outstanding securities issued by the Corporation convertible into Series A
Preferred Stock. Fractions of the Series A Preferred Stock may be issued, but
only in integral multiples of one one-thousandth of a share.
II. Dividends and Distributions
(A) Subject to the rights of the holders of any share of any
series of Preferred Stock (or any similar stock) ranking prior and
superior to the Series A Preferred Stock with respect to dividends, the
holders of shares of Series A Preferred Stock, in preference to the
holders of Common Stock, par value $.01 per share (the "Common Stock"),
of the Corporation, and of any other junior stock, shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds
legally available for the purpose, quarterly dividends payable in cash
on the first day of March, June, September and December in each year
(each such date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend Payment Date
after the first issuance of a share or fraction of a share of Series A
Preferred Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (a) $100 or (b) subject to the provision for
adjustment hereinafter set forth, 1000 times the aggregate per share
amount of all cash dividends, and 1000 times the aggregate per share
amount (payable in kind) of all non-cash dividends or other
distributions, other than a dividend payable in shares of Common Stock
or a subdivision of the outstanding shares of Common Stock (by
reclassification or otherwise), declared on the Common Stock since the
immediately preceding Quarterly Dividend Payment Date or, with respect
to the first Quarterly Dividend Payment Date, since the first issuance
of any share or fraction of a share of Series A Preferred Stock. In the
event the Corporation shall at any time declare or pay any dividend on
the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares
of Common Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the amount to which
holders of shares of Series A Preferred Stock were entitled immediately
prior to such event under clause (b) of the preceding sentence shall be
adjusted by multiplying such amount by a fraction, the numerator of
which is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of shares
of Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on
the Series A Preferred Stock as provided in paragraph A of this Section
immediately after it declares a dividend or distribution on the Common
Stock (other than a dividend payable in shares of Common Stock);
provided that, in the event no dividend or distribution shall have been
declared on the Common Stock during the period between any Quarterly
Dividend Payment Date and the next subsequent Quarterly Dividend Payment
Date, a dividend of $100 per share on the Series A Preferred Stock shall
nevertheless be payable on such subsequent Quarterly Dividend Payment
Date.
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such shares,
unless the date of issue of such shares is prior to the record date for
the first Quarterly Dividend Payment Date, in which case dividends on
such shares shall begin to accrue from the date of issue of such shares,
or unless the date of issue is a Quarterly Dividend Payment Date or is
a date after the record date for the determination of holders of shares
of Series A Preferred Stock entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of which events
such dividends shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not
bear interest. Dividends paid on the shares of Series A Preferred Stock
in an amount less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. The
Board of Directors may fix a record date for the determination of
holders of shares of Series A Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon, which record
date shall be not more than 60 days prior to the date fixed for the
payment thereof.
III. Voting Rights
The holders of shares of Series A Preferred Stock shall have the
following voting rights:
(A) Subject to the provisions for adjustment hereinafter set
forth, each share of Series A Preferred Stock shall entitle the holder
thereof to 1000 votes (and each one one-thousandth of a share of Series
A Preferred Stock shall entitle the holder thereof to one vote) on all
matters submitted to a vote of the stockholders of the Corporation. In
the event the Corporation shall at any time declare or pay any dividend
on the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares
of Common Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the number of votes per
share to which holders of shares of Series A Preferred Stock were
entitled immediately prior to such event shall be adjusted by
multiplying such number by a fraction, the numerator of which is the
number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.
(B) Except as otherwise provided herein, in any other
Certificate of Designation creating a series of Preferred Stock or any
similar stock, or by law, the holders of shares of Series A Preferred
Stock and the holders of shares of Common Stock and any other capital
stock of the Corporation having general voting rights shall vote
together as one class on all matters submitted to a vote of stockholders
of the Corporation.
(C) Except as set forth herein, holders of shares of Series A
Preferred Stock shall have no voting rights.
IV. Certain Restrictions
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided in
Section II are in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not declared, on shares of
Series A Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (either as
to dividends or upon liquidation, dissolution or winding up) to
the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity (either
as to dividends or upon liquidation, dissolution or winding up)
with the Series A Preferred Stock except dividends paid ratably
on the Series A Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to the total
amounts to which the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any such
junior stock in exchange for shares of any stock of the
Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A Preferred
Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock, or any
shares of stock ranking on a parity with the Series A Preferred
Stock, except in accordance with a purchase offer made in writing
or by publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend rates and
other relative rights and preferences of the respective series and
classes, shall determine in good faith will result in fair and
equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any
shares of stock of the Corporation unless the Corporation could, under
paragraph (A) of this Section IV purchase or otherwise acquire such
shares at such time and in such manner.
V. Reacquired Shares
Any shares of Series A Preferred Stock purchased or otherwise acquired
by the Corporation in any manner whatsoever shall be retired and cancelled
promptly after the acquisition thereof. All such shares upon their
cancellation become authorized but unissued shares of Preferred Stock and may
be reissued as part of a new series of Preferred Stock subject to the
conditions and restrictions on issuance set forth herein, in the Restated
Certificate of Incorporation, in any other Certificate of Designation creating
a series of Preferred Stock or any similar stock or as otherwise required by
law.
VI. Liquidation, Dissolution or Winding Up
Upon any liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (1) to the holders of shares of stock ranking
junior (either as to dividends or upon liquidation, dissolution or winding up)
to the Series A Preferred Stock unless, prior thereto, the holders of shares
of Series A Preferred Stock shall have received $1000 per share, plus an
amount equal to accrued and unpaid dividends and distributions thereon,
whether or not declared, to the date of such payment, provided that the
holders of shares of Series A Preferred Stock shall be entitled to receive an
aggregate amount per share, subject to the provision for adjustment
hereinafter set forth, equal to 1000 times the aggregate amount to be
distributed per share to holders of shares of Common Stock, or (2) to the
holders of shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Preferred Stock,
except distributions made ratably on the Series A Preferred Stock and all such
parity stock in proportion to the total amounts to which the holders of all
such shares are entitled upon such liquidation, dissolution or winding up.
In the event the Corporation shall at any time declare or pay any dividend on
the Common Stock payable in shares of Common Stock, or effect a subdivision
or combination or consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares of Common Stock, then
in each such case the aggregate amount to which holders of shares of Series
A Preferred Stock were entitled immediately prior to such event under the
proviso in clause (1) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
VII. Consolidation, Merger, etc.
In case the Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash and/or any other
property, then in any such case each share of Series A Preferred Stock shall
at the same time be similarly exchanged or changed into an amount per share,
subject to the provision for adjustment hereinafter set forth, equal to 1000
times the aggregate amount of stock, securities, cash and/or any other
property (payable in kind), as the case may be, into which or for which each
share of Common Stock is changed or exchanged. In the event the Corporation
shall at any time declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by reclassification
or otherwise than by payment of a dividend in shares of Common Stock) into a
greater or lesser number of shares of Common Stock, then in each such case the
amount set forth in the preceding sentence with respect to the exchange or
change of shares of Series A Preferred Stock shall be adjusted by multiplying
such amount by a fraction, the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding
immediately prior to such event.
VIII. Redemption
The shares of Series A Preferred Stock shall not be redeemable.
IX. Rank
The Series A Preferred Stock shall rank, with respect to the payment of
dividends and the distribution of assets, junior to all series of any other
class of the Corporation's Preferred Stock.
X. Amendment
The Certificate of Incorporation of the Corporation shall not be amended
in any manner which would materially alter or change the powers, preferences
or special rights of the Series A Preferred Stock so as to affect them
adversely without the affirmative vote of the holders of at least eighty
percent (80%) of the outstanding shares of Series A Preferred Stock, voting
together as a single series.
IN WITNESS WHEREOF, this Certificate is executed on behalf of the
Corporation by its Chief Executive Officer and attested by its Secretary this
1st day of October 1992.
/s/ Samuel E. Beall, III
Samuel E. Beall, III,
Chief Executive Officer
Attest:
/s/ Pfilip G. Hunt
Pfilip G. Hunt
Secretary
STATE OF ALABAMA )
) ss.
COUNTY OF MOBILE )
The foregoing instrument was acknowledged before me this 1st day of
October, 1992 by Samuel E. Beall, III, Chief Executive Officer of Morrison
Restaurants, Inc., on behalf of the Corporation.
/s/ Dione D. McGrew
Notary Public
MY COMMISSION EXPIRES DEC. 7, 1992.
[SEAL]
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION OF
MORRISON INCORPORATED
It is hereby certified that:
1. The name of the corporation (hereinafter called the "Corporation")
is Morrison Incorporated.
2. The certificate of incorporation of the Corporation is hereby
amended by striking out Article I. thereof; and by substituting in lieu of
said Article the following new Article:
"The name of the Corporation is Morrison Restaurants
Inc."
3. The amendment of the certificate of incorporation herein certified
has been duly approved and adopted in accordance with the provisions of
Section 242 of the General Corporation Law of the State of Delaware by the
unanimous action of the Board of Directors of the Corporation, and by a
majority vote of the stockholders of the Corporation at the Annual Meeting of
Stockholders held on September 30, 1992.
Signed and attested to on this 30th day of September, 1992.
/s/ Samuel E. Beall, III
Samuel E. Beall, III, President
Attest:
/s/ Pfilip G. Hunt
Pfilip G. Hunt, Senior Vice President,
General Counsel and Secretary
STATE OF ALABAMA )
COUNTY OF MOBILE )
BE IT REMEMBERED that, on September 30, 1992, before me, a Notary Public
duly authorized by law to take acknowledgement of deeds, personally came
Samuel E. Beall, III, President of Morrison Incorporated, who duly signed the
foregoing instrument before me and acknowledged that such signing is his act
and deed, that such instrument as executed is the act and deed of said
corporation, and that the facts stated therein are true.
GIVEN under my hand on September 30, 1992
/s/ Dione D. McGrew
Notary Public
[SEAL] MY COMMISSION EXPIRES DEC. 7, 1992
CERTIFICATE OF MERGER
OF
D-M PREMIER MANAGEMENT, INC.
(a Colorado Corporation)
AND
DOBBS FOOD SERVICE MANAGEMENT, INC.
(a Delaware Corporation)
INTO
MORRISON INCORPORATED
(a Delaware Corporation)
It is hereby certified that:
1. The constituent business corporations participating in the merger
herein certified are:
(i) D-M Premier Management, Inc., which is incorporated under the
laws of the State of Colorado; and
(ii) Dobbs Food Service Management, Inc., which is incorporated
under the laws of the State of Delaware; and
(iii) Morrison Incorporated, which is incorporated under the laws
of the State of Delaware.
2. An Agreement of Merger has been approved, adopted, certified,
executed, and acknowledged by each of the aforesaid constituent corporations
in accordance with the provisions of subsection (c) of Section 252 of the
General Corporation Law of the State of Delaware, to wit, by D-M Premier
Management, Inc. in accordance with the laws of the State of its incorporation
and by Dobbs Food Service Management, Inc. and Morrison Incorporated, in the
same manner as is provided in Section 251 of the General Corporation Law of
the State of Delaware.
3. The name of the surviving corporation in the merger herein
certified is Morrison Incorporated, which will continue its existence as said
surviving corporation under its present name upon the effective date of said
merger pursuant to the provisions of the General Corporation Law of the State
of Delaware.
4. The Certificate of Incorporation of Morrison Incorporated, as now
in force and effect, shall continue to be the Certificate of Incorporation of
said surviving corporation until amended and changed pursuant to the
provisions of the General Corporation Law of the State of Delaware.
5. The executed Agreement of Merger between the aforesaid constituent
corporations is on file at the principle place of business of the aforesaid
surviving corporation, the address of which is as follows:
4721 Morrison Drive
Mobile, Alabama 36609
6. A copy of the aforesaid Agreement of Merger will be furnished by
the aforesaid surviving corporation, on request, and without cost, to any
stockholder of each of the aforesaid constituent corporations.
7. The authorized capital stock of D-M Premier Management, Inc.
consists of 100,000 shares.
8. The Agreement of Merger between the aforesaid constituent
corporations provides that the merger herein certified shall be effective on
June 3, 1989 insofar as the General Corporation Law of the State of Delaware
shall govern said effective date.
Date: April 14, 1989 D-M Premier Management, Inc.
By: /s/ J. L. Lambert
J. L. Lambert
Senior Vice-President
Attest:
/s/ Pfilip G. Hunt
Pfilip G. Hunt
Secretary
Dated: April 14, 1989 Dobbs Food Service Management, Inc.
By: /s/ J. L. Lambert
J. L. Lambert
Senior Vice-President
Attest:
/s/ Pfilip G. Hunt
Pfilip G. Hunt
Secretary
Dated: April 14, 1989 Morrison Incorporated
By: /s/ J. L. Lambert
J. L. Lambert
Senior Vice-President
Attest:
/s/ Pfilip G. Hunt
Pfilip G. Hunt
Secretary
CERTIFICATE OF OWNERSHIP AND MERGER
OF
MORRISON INCORPORATED
(a Florida corporation)
into
RTMC ACQUISITION INCORPORATED
(a Delaware corporation)
It is hereby certified that:
1. Morrison Incorporated (hereinafter called the "corporation") is
a corporation of the State of Florida, the laws of which permit a merger of
a corporation of that jurisdiction with a corporation of another jurisdiction.
2. The corporation, as the owner of all of the outstanding shares of
the stock of RTMC Acquisition Incorporated, hereby merges itself into RTMC
Acquisition Incorporated, a corporation of the State of Delaware.
3. Attached hereto as Exhibit A is a copy of the resolutions adopted
on the 29th day of June, 1987, by the Board of Directors of the corporation
to merge the corporation into RTMC Acquisition Incorporated.
4. Attached hereto as Exhibit B is a copy of the Agreement and Plan
of Merger made as of August 26th, 1987, executed on behalf of both the
corporation and RTMC Acquisition Incorporated, to merge the corporation into
RTMC Acquisition Incorporated and, effective the date of the merger, to change
the name of RTMC Acquisition Incorporated to "Morrison Incorporated," which
name has been duly reserved.
5. The proposed merger herein certified has been approved by at least
a majority of the outstanding stock entitled to vote of the corporation at a
meeting thereof, duly called and held after at least 20 days' notice of the
time, place, and purpose of the meeting mailed to each such stockholder at his
address as it appears on the record of the corporation.
6. The proposed merger has been adopted, approved, certified,
executed and acknowledged by the parent corporation in accordance with the
Florida General Corporation Act.
Signed and attested to on September 28, 1987.
By: /s/ E. Eugene Bishop
E. Eugene Bishop
Chairman of the Board of
MORRISON INCORPORATED
Attest:
By: /s/ Pfilip G. Hunt
Pfilip G. Hunt
Secretary of
MORRISON INCORPORATED
EXHIBIT A
WHEREAS, pursuant to the Florida General Corporation Act and the Delaware
General Corporation Law, the Plan of Merger must be approved by the holders
of a majority of the outstanding shares of common stock of the Corporation;
NOW, THEREFORE, BE IT RESOLVED, that, after the organization of the Subsidiary
and the execution and delivery of the Plan of Merger as contemplated hereby,
the Corporation, as the sole shareholder of the Subsidiary, approve and adopt
the Plan of Merger; and the Chairman of the Board, the President or any Vice
President of the Corporation be, and each hereby is, authorized and directed
to execute a Consent Action on behalf of the Corporation, as sole shareholder
of the Subsidiary, approving and adopting such Plan of Merger; and
BE IT FURTHER RESOLVED, that the Plan of Merger be submitted to a vote of the
shareholders of the Corporation for approval and adoption thereof at the
Annual Meeting of Shareholders to be held on September 28, 1987; and
BE IF FURTHER RESOLVED, that the Board of Directors of the Corporation does
recommend to the shareholders of the Corporation that they approve and adopt
the Plan of Merger.
EXHIBIT B
AGREEMENT AND PLAN OF MERGER OF
MORRISON INCORPORATED
WITH AND INTO
RTMC ACQUISITION INCORPORATED
This AGREEMENT AND PLAN OF MERGER (the "Agreement") is made and entered
into as of this 26th day of August, 1987 by and between Morrison Incorporated,
a Florida corporation ("Morrison-Florida"), and RTMC Acquisition Incorporated,
a Delaware corporation ("Morrison-Delaware") and wholly-owned subsidiary of
Morrison-Florida (Morrison-Florida and Morrison-Delaware hereinafter sometimes
collectively referred to as the "Constituent Corporations");
W I T N E S S E T H:
WHEREAS, Morrison-Florida has authorized capitalization consisting of:
(i) 30,000,000 shares of common stock, $2.00 par value ("Morrison-Florida
Common Stock"); and (ii) 100,000 shares of preferred stock, no par value
("Morrison-Florida Preferred Stock"); and
WHEREAS, Morrison-Delaware has authorized capitalization consisting of:
(i) 50,000,000 shares of common stock, $.01 par value ("Morrison-Delaware
Common Stock"); and (ii) 250,000 shares of preferred stock, $.01 par value
("Morrison-Delaware Preferred Stock"); and
WHEREAS, the Board of Directors of each of the Constituent Corporations
has determined that it is advisable and for the benefit of each of the
Constituent Corporations and its shareholders that Morrison-Florida be merged
with and into Morrison-Delaware on the terms and conditions hereinafter set
forth; and
WHEREAS, the Board of Directors of each of the Constituent Corporations
has approved this Agreement and the merger contemplated hereby and has
directed that this Agreement be submitted to a vote of its respective
shareholders;
NOW, THEREFORE, for and in consideration of the premises and of the
mutual agreements, promises and covenants contained herein, and in accordance
with the applicable provisions of the Florida General Corporation Act and
Delaware General Corporation Law, the parties hereto hereby agree as follows:
SECTION 1. Merger
1.1 On the Effective Date (as hereinafter defined), Morrison-Florida
shall be merged with and into Morrison-Delaware and Morrison-Delaware shall
survive the merger (the "Merger"); the Merger shall in all respects have the
effect provided for in the Florida General Corporation Act, the Delaware
General Corporation Law and in this Agreement.
1.2 Morrison-Delaware, the corporation surviving the Merger
(hereinafter sometimes referred to as the "Surviving Corporation"), shall
continue its corporate existence under the laws of the State of Delaware.
1.3 Without limiting the foregoing, on and after the Effective Date,
the separate existence of Morrison-Florida shall cease, and, in accordance
with the terms of this Agreement the Surviving Corporation shall possess all
the rights, privileges, immunities and franchises, of a public or private
nature, of each of the Constituent Corporations; and all debts due on whatever
account, including subscriptions to shares, and all other choses in action and
all and every other interest of or belonging to or due to either of the
Constituent Corporations shall be taken and deemed to be transferred to and
invested in the Surviving Corporation without further act or deed; and all
property; rights and privileges, powers and franchises and all and every other
interest shall thereafter effectively be the property of the Surviving
Corporation as they were of the respective Constituent Corporations, and the
title to any real estate whether by deed or otherwise, vested in either of
said Constituent Corporations, shall not revert or be in any way impaired by
reason of this Merger. The Surviving Corporation shall thenceforth be
responsible and liable for all the liabilities and obligations of the
Constituent Corporations. Any claim existing or action or proceeding pending
by or against either of said Constituent Corporations may be prosecuted as if
the Merger had not taken place or the Surviving Corporation may be substituted
in its place. Neither the rights of creditors nor any liens upon property of
either of the Constituent Corporations shall be impaired by the Merger.
1.4 Prior to and from and after the Effective Date, the Constituent
Corporations shall have all such actions as shall be necessary or appropriate
in order to effectuate the Merger. If at any time the Surviving Corporation
shall consider or be advised that any further assignments or assurances in law
or any other actions are necessary, appropriate or desirable to vest in said
corporation, according to the terms hereof, the title to any property or
rights of Morrison-Florida, the last acting officers of Morrison-Florida, or
the corresponding officers of the Surviving Corporation, shall and will
execute and make all such proper assignments and assurances and take all
action necessary and proper to vest title in such property or rights in the
Surviving Corporation and otherwise to carry out the purposes of this
Agreement.
Section 2. Terms of Transaction
2.1 Upon the Effective Date:
(a) Each share of Morrison-Florida Common Stock issued and
outstanding immediately prior to the Effective Date shall by virtue of
the Merger and without any action on the part of the holder thereof,
thereupon be converted into one share of Morrison-Delaware Common Stock,
the shares of Morrison-Delaware Common Stock required for such purpose
being drawn from authorized but unissued shares of Morrison-Delaware.
(b) Each share of Morrison-Delaware Common Stock outstanding and
owned of record by Morrison-Florida immediately prior to the Effective
Date shall be cancelled and retired and returned to the status of
authorized but unissued capital stock of the Surviving Corporation and
all certificates representing such shares shall be cancelled and no cash
or securities or other property shall be issued in respect thereof.
(c) Each share of Morrison-Florida Common Stock held in the
treasury of Morrison-Florida immediately prior to the Effective Date
shall be cancelled and retired and all certificates representing such
shares shall be cancelled.
(d) Each option to purchase Morrison-Florida Common Stock
granted under the Long Term Incentive Stock Option Plan and the 1987
Stock Bonus and Nonqualified Stock Option Plan (together, the "Stock
Option Plans") and any other options to purchase Morrison-Florida Common
Stock outstanding immediately prior to the Effective Date shall, by
virtue of the Merger and without any action on the part of the holder
thereof, thereupon be converted into and become an option to purchase
the same number of shares of Morrison-Delaware Common Stock at the same
option price per share and upon the same terms and subject to the same
conditions as set forth in the Stock Option Plans or other stock option
agreement, as the case may be, as in effect on the Effective Date. The
same number of shares of Morrison-Delaware Common Stock shall be
reserved for the purposes of issuance upon the exercise of options
granted pursuant to each of the Stock Option Plans or other stock option
agreement as is equal to the number of shares of Morrison-Florida Common
Stock so reserved as of the Effective Date.
(e) Each right (a "Right") governed by that certain Rights
Agreement between Morrison-Florida and AmSouth Bank, National
Association, dated March 30, 1987 (the "Shareholder Rights Plan"), to
purchase shares of Preferred Stock from Morrison-Florida and to sell
shares of Common Stock to Morrison-Florida, under certain circumstances
and pursuant to the Shareholder Rights Plan, shall, by virtue of the
Merger and without further action on the part of the holder thereof or
any other person, be converted into and exchanged for a Right to
purchase shares of Morrison-Delaware Preferred Stock from Morrison-
Delaware and to sell shares of Morrison-Delaware Common Stock to
Morrison-Delaware or other parties, at the same price per share, and
pursuant to, and subject to the conditions set forth in, the Shareholder
Rights Plan in effect as of the Effective Date. The same number of
shares of Morrison-Delaware Preferred Stock shall be designated as
"Series A Junior Participating Preferred Stock" and reserved for
issuance upon the exercise of the Rights pursuant to the Shareholder
Rights Plan as is equal to the number of shares of Morrison-Florida
Preferred Stock so designated and reserved as of the Effective Date.
2.2 Upon the Effective Date, the obligations of Morrison-Florida under
or with respect to any plan, trust, program and benefit then in effect or
administered by Morrison-Florida (collectively, "Employee Benefit Plans"),
shall become the lawful obligations of the Surviving Corporation and shall be
implemented and administered in the same manner and without interruption until
the same are amended or otherwise lawfully altered or terminated. The
Surviving Corporation hereby expressly adopts and assumes, as of the Effective
Date, all obligations of Morrison-Florida under and with respect to each of
the Stock Options Plans and the Employee Benefit Plans.
2.3 After the Effective Date, each outstanding certificate representing
shares of Morrison-Florida Common Stock immediately prior to the Effective
Date shall be deemed for all purposes to evidence ownership of and to
represent the same number of shares of Morrison-Delaware Common Stock into
which the shares of Morrison-Florida Common Stock formerly represented by such
certificate shall have been converted as herein provided. After the Effective
Date, whenever certificates which formerly represented shares of Morrison-
Florida Common Stock are presented for exchange or registration of transfer,
the Surviving Corporation will cause to be issued in respect thereof
certificates representing an equal number of shares of Morrison-Delaware
Common Stock.
Section 3. Directors and Officers
On the Effective Date the persons who are directors and offices of
Morrison-Delaware shall resign and the persons who are directors and officers
of Morrison-Florida immediately prior to the Effective Date shall become the
directors and officers of the Surviving Corporation and shall continue to hold
office as provided in the Certificate of Incorporation and Bylaws of the
Surviving Corporation until their successors are elected and qualified or
their earlier resignation, removal or death.
Section 4. Charter and Bylaws
4.1 From and after the Effective Date, the Certificate of Incorporation
of Morrison-Delaware as in effect immediately prior to the Effective Date
shall be the Certificate of Incorporation of the Surviving Corporation and
shall continue in effect until the same shall be altered, amended or repealed
as therein provided or as provided by law, except that Article I of such
Certificate of Incorporation shall be amended upon the Effective Date to read
in its entirety as follows:
"The name of the corporation is 'Morrison Incorporated' (hereinafter the
'Corporation')."
4.2 From and after the Effective Date, the Bylaws of Morrison-Delaware
as in effect immediately prior to the Effective Date shall be the Bylaws of
the Surviving Corporation and shall continue in effect until the same shall
be altered or repealed as therein provided or as provided by law.
Section 5. Shareholder Approval; Effectiveness of Merger
This Agreement shall be submitted for approval to the shareholders of
Morrison-Florida as provided by the Florida Business Corporation Act and to
the sole shareholder of Morrison-Delaware as provided by the Delaware General
Corporation Law. If this Agreement is duly authorized and adopted by the
requisite vote or written consent of such shareholders and is not terminated
and abandoned pursuant to the provisions of Section 6 hereof, this Agreement
shall be executed and this Agreement, or Articles of Merger incorporating the
terms of this Agreement, shall be filed and recorded in accordance with the
laws of the State of Florida and the State of Delaware, as appropriate, as
soon as practicable after the last approval by such shareholders or sole
shareholder. The Merger shall become effective as of the close of business
on the later of the date on which this Agreement, or Articles of Merger
incorporating the terms of this Agreement, are (i) filed with the Secretary
of State of Florida or (ii) filed with the Secretary of State of Delaware
(said date is herein referred to as the "Effective Date").
Section 6. Termination.
At any time prior to the filing and recordation of this Agreement, or
Articles of Merger incorporating the terms of this Agreement, with either the
Secretary of State of Florida or the Secretary of State of Delaware, the Board
of Directors of Morrison-Florida or the Board of Directors or Morrison-
Delaware may terminate and abandon this Agreement notwithstanding earlier
approval by each such Board or favorable action on the Merger by the
shareholders of Morrison-Florida or the sole shareholder of Morrison-Delaware.
Section 7. Amendments
The Board of Directors of the Constituent Corporations, prior to the
Effective Date, may jointly amend, modify and supplement this Agreement in
such manner as they may deem appropriate at any time before or after approval
or adoption hereof by the shareholders of Morrison-Florida or the sole
shareholder of Morrison-Delaware; provided, however, that after favorable
action by the shareholders of Morrison-Florida or the sole shareholder of
Morrison-Delaware, no such amendment, modification or supplement shall affect
the rights of such shareholders or sole shareholder in a manner which is
materially adverse to such shareholders or sole shareholder, as the case may
be.
Section 8. Miscellaneous
8.1 This Agreement may be executed in counterparts, each of which when
so executed shall be deemed to be an original but all of which together shall
constitute one and the same instrument.
8.2 With respect to all leases and other agreements, instruments or
obligations under which either of the Constituent Corporations is obligated
to obtain a consent prior to the Merger herein contemplated or in order to
comply with the conditions thereof, or to vest the respective interest therein
in the Surviving Corporation, the Constituent Corporations shall each exercise
all reasonable efforts to obtain such consent prior to the Effective Date.
8.3 Except as otherwise provided in this Agreement, nothing contained
herein is intended, nor shall be construed, to confer upon or give any person,
firm or corporation, other than the Constituent Corporations and their
respective shareholders, any rights or remedies under or by reason of this
Agreement.
8.4 This Agreement and the legal relations between the parties hereto
shall be governed by and construed in accordance with the laws of the State
of Delaware.
IN WITNESS WHEREOF, each Constituent Corporation has caused this
Agreement to be executed on its behalf and its corporate seal to be affixed
hereto and the foregoing attested, all by its duly authorized officers, as of
the date hereinabove first written.
MORRISON INCORPORATED
By: /s/ E. E. Bishop
E.E. Bishop
Chairman of the Board and
Chief Executive Officer
ATTEST:
By:/s/ Pfilip G. Hunt
Pfilip G. Hunt
Senior Vice President,
General Counsel and Secretary
[CORPORATE SEAL]
RTMC ACQUISITION INCORPORATED
By: /s/ E. E. Bishop
E.E. Bishop
Chairman of the Board and
Chief Executive Officer
ATTEST:
By:/s/ Pfilip G. Hunt
Pfilip G. Hunt
Senior Vice President
General Counsel and Secretary
[CORPORATE SEAL]
CERTIFICATE OF INCORPORATION
OF
RTMC ACQUISITION INCORPORATED
The undersigned, for the purposes of forming a corporation pursuant to
Sections 101 and 102 of the General Corporation Law of Delaware, does hereby
certify as follows:
I.
NAME
The name of the corporation is "RTMC Acquisition Incorporated"
(hereinafter the "Corporation").
II.
REGISTERED OFFICE AND AGENT
The address of the Corporation's registered office in the State of
Delaware is 229 South State Street, City of Dover, County of Kent, 19901. The
name of the Corporation's registered agent at such address is The Prentice-
Hall Corporation System, Inc.
III.
BUSINESS
The purpose for which the Corporation is organized is to engage in any
lawful act or activity for which corporations may be organized under the
General Corporation Law of Delaware.
IV.
CAPITALIZATION
(a) The total number of shares of capital stock which the Corporation
shall have authority to issue is Fifty Million Two Hundred Fifty Thousand
(50,250,000), divided into two classes as follows:
(1) Fifty Million (50,000,000) shares of common stock, $.01 par
value per share ("Common Stock"); and
(2) Two Hundred Fifty Thousand (250,000) shares of preferred
stock, $.01 par value per share ("Preferred Stock").
(b) The preferences, limitations and relative rights of the Common
Stock and the Preferred Stock are as follows:
(1) The holders of Common Stock shall be entitled to one vote
for each share on all matters required or permitted to be voted on by
stockholders of the Corporation.
After payment or provision for the payment of dividends on any
series of Preferred Stock then outstanding to the extent provided by the
Board of Directors of the Corporation in resolutions providing for the
issuance thereof, the Board of Directors of the Corporation may declare
and pay dividends on the Common Stock as and to the extent permitted by
law.
(2) The Preferred Stock entitles the holders thereof to the
rights and preferences set out or determined as provided below.
Any unissued shares of Preferred Stock may be issued from time to
time in one or more series. All shares of Preferred Stock shall be
identical and of equal rank, except with respect to particular
variations in the relative rights and preferences as between different
series which may be fixed and determined by the Board of Directors of
the Corporation as hereinafter provided, and each share of any series
of Preferred Stock shall be identical in all respects with the other
shares of such series except that, if dividends thereon are cumulative,
as to the date from which dividends thereon shall accumulate.
Different series of Preferred Stock shall not be construed to
constitute different classes of stock for the purpose of voting by
classes, except to the extent such voting by classes is expressly
required by law.
Before any shares of Preferred Stock of any particular series
shall be issued, the Board of Directors of the Corporation shall, by
resolution adopted, fix and determine, and is hereby expressly empowered
to fix and determine, in the manner provided by law, the following
provisions, rights and preferences of shares of any such series:
(A) The distinctive designation of such series and the
number of shares which shall constitute such series, which number
may be increased (except where otherwise provided by the Board of
Directors of the Corporation in creating such a series) or
decreased (but not below the number of shares thereof then issued)
from time to time by action of the Board of Directors of the
Corporation;
(B) The amount of capital of such series;
(C) The annual rate of any dividends which may be payable
on shares of such series, whether dividends shall be cumulative,
and the conditions upon which and the date when such dividends
shall begin to accumulate on all shares of such series issued
prior to the record date for the first dividend of such series;
(D) Whether the shares of any such series shall be
redeemable, and if so, the time or times when, the conditions
under which and the price or prices at which shares of such series
shall be redeemable and the purchase, retirement or sinking fund
provisions, if any, for the purchase or redemption of such shares;
(E) The amount payable on shares of such series in the
event of voluntary or involuntary liquidation, dissolution or
winding up of the affairs of the Corporation;
(F) The rights, if any, of the holders of shares of such
series to convert such shares into, or exchange such shares for,
shares of Common Stock or shares of any other series of Preferred
Stock and the terms and conditions of such conversion or exchange;
and
(G) Whether or not the holders of shares of such series
have voting rights, and the extent of such voting rights, if any.
The holders of Preferred Stock are entitled to receive, when and
as declared by the Board of Directors of the Corporation, but only from
funds legally available for the payment of dividends, cash dividends at
the annual rate for each particular series as fixed and determined by
the Board of Directors of the Corporation as herein authorized, and no
more; such dividends shall be payable before any dividend on Common
Stock shall be paid or set apart for payment. Any arrearages in the
payment of dividends shall not bear interest.
In the event of any dissolution, liquidation or winding up of the
affairs of the Corporation, whether voluntary or involuntary, after
payment or provisions for payment of the debts and other liabilities of
the Corporation, the holders of shares of each series of Preferred Stock
shall be entitled to receive in cash, out of the net assets of the
Corporation, an amount equal to the amount fixed and determined by the
Board of Directors of the Corporation in any resolution providing for
the issuance of any particular series of Preferred Stock, plus an amount
equal to any dividends payable to such holder which are then unpaid,
either under the provisions of the resolution of the Board of Directors
of the Corporation providing for the issuance of such series of
Preferred Stock or by declaration of the Board of Directors of the
Corporation, on each such share up to the date fixed for distribution,
and no more, before any distribution shall be made to the holders of
Common Stock. Neither the merger or consolidation of the Corporation,
nor the sale, lease or conveyance of all or a part of its assets, shall
be deemed to be a liquidation, dissolution or winding up of the affairs
of the Corporation.
V.
STOCKHOLDER ACTION WITHOUT MEETING
Action required to be taken or which may be taken at any Annual Meeting
or Special Meeting of Stockholders may be taken without a meeting, without
prior notice and without a vote if a consent in writing, setting forth the
action so taken, shall be signed by all the holders of outstanding shares of
stock entitled to vote on such action.
VI.
CORPORATE EXISTENCE
The existence of the Corporation shall be perpetual.
VII.
BOARD OF DIRECTORS
(a) The business and affairs of the Corporation shall be managed by,
or under the direction of, a Board of Directors comprised as follows:
(1) The initial number of directors shall be such as may be
determined by the incorporator and thereafter the number of directors
of the Corporation shall be not less than nine and not more than twelve,
the exact number within such minimum and maximum limits to be fixed and
determined from time to time by resolution of a majority of the Board
of Directors or by the affirmative vote of the holders of at least 80%
of all outstanding shares entitled to be voted in the election of
directors, voting together as a single class.
(2) At the first Special Meeting of Stockholders, the Board of
Directors shall be divided into three classes, each consisting, as
nearly as may be possible, of one-third of the total number of directors
constituting the entire Board of Directors. At the first Special
Meeting of Stockholders, the first class of directors shall be elected
for a year term expiring upon the next following Annual Meeting of
Stockholders and upon the election and qualification of their respective
successors, the second class of directors shall be elected for a term
expiring upon the second next Annual Meeting of Stockholders and upon
the election and qualification of their respective successors, and the
third class of directors shall be elected for a term expiring upon the
third next Annual Meeting of Stockholders and upon the election and
qualification of their respective successors. At each succeeding Annual
Meeting of Stockholders, successors to the class of directors whose term
expires at that Annual Meeting of Stockholders shall be elected for a
three-year term. If the number of directors has changed, any increase
or decrease shall be apportioned among the classes so as to maintain the
number of directors in each class as nearly equal as possible, and any
additional director of any class elected to fill a vacancy resulting
from an increase in such a class shall hold office for a term that shall
coincide with the remaining term of that class, unless otherwise
required by law, but in no case shall a decrease in the number of
directors for a class shorten the term of an incumbent director.
(3) A director shall hold office until the Annual Meeting of
Stockholders upon which his term expires and until his successor shall
be elected and qualified, subject, however, to prior death, resignation,
retirement, disqualification or removal from office. Directors may be
removed only for cause by the vote of at least 80% of the outstanding
shares entitled to vote at an election of directors, at a meeting of
stockholders called expressly for that purpose.
(4) Nominations for the election of directors may be made by the
Board of Directors or a committee appointed by the Board of Directors,
or by any stockholder entitled to vote generally in the election of
directors; provided, however, any stockholder entitled to vote generally
in the election of directors may nominate one or more persons for
election as directors at a meeting only if written notice of such
stockholder's intent to make such nomination or nominations has been
given, either by personal delivery or by the United States mail, postage
prepaid, to the Secretary of the Corporation not later than (i) with
respect to any election to be held at the Annual Meeting of
Stockholders, 90 days in advance of such meeting, and (ii) with respect
to any election to be held at a Special Meeting of Stockholders for the
election of directors, the close of business on the seventh day
following the date on which notice of such meeting is first given to
stockholders. Each such notice shall set forth:
(A) the name and address of the stockholder who intends
to make the nomination and of the person or persons to be
nominated;
(B) a representation that the stockholder is a holder of
record of shares of the Corporation entitled to vote at such
meeting and intends to appear in person or by proxy at the meeting
to nominate the person or persons specified in the notice;
(C) a description of all arrangements or understandings
between the stockholder and each nominee and any other person or
persons (naming such person or persons) pursuant to which the
nomination or nominations are to be made by the stockholder;
(D) such other information regarding each nominee proposed
by such stockholder as would be required to be included in a proxy
statement filed pursuant to the then current proxy rules of the
Securities and Exchange Commission, if the nominees where to be
nominated by the Board of Directors; and
(E) the consent of each nominee to serve as a director of
the Corporation if so elected.
The chairman of the meeting may refuse to acknowledge the nomination of
any person not made in compliance with the foregoing procedure.
(5) Any vacancy on the Board of Directors that results from an
increase in the number of directors or from prior death, resignation,
retirement, disqualification or removal from office of a director shall
be filled by a majority of the Board of Directors then in office, though
less than a quorum, or by the sole remaining director. Any director
elected to fill a vacancy resulting from prior death, resignation,
retirement, disqualification or removal from office of a director, shall
have the same remaining term as that of his predecessor.
(6) At any meeting of stockholders with respect to which notice
of such purpose has been given, the entire Board of Directors or any
individual director may be removed, with cause, by the affirmative vote
of the holders of 80% of all outstanding shares entitled to be voted at
an election of directors.
(7) Notwithstanding the foregoing, whenever the holders of any
one or more classes or series of Preferred Stock issued by the
Corporation shall have the right, voting separately by class or series,
to elect directors at an Annual or Special Meeting of Stockholders, the
election, term of office, filling of vacancies and other features of
such directorships shall be governed by the terms of this Certificate
of Incorporation or the resolutions of the Board of Directors creating
such class or series, as the case may be, applicable thereto, and such
directors so elected shall not be divided into Classes pursuant to this
Section (a) of Article VII unless expressly provided by such terms.
(b) Except as may be prohibited by law, by the Bylaws of the
Corporation, or by this Certificate of Incorporation, the Board of Directors
shall have the right to make, alter, amend, change, add to, or repeal the
Bylaws of the Corporation, and have the right (which, to the extent exercised,
shall be exclusive) to establish the rights, powers, duties, rules and
procedures that from time to time shall govern the Board of Directors, each
of its members, including without limitation, the vote required for any action
and the election of officers of the Corporation by the Board of Directors, and
that from time to time shall affect the directors' powers to manage the
business and affairs of the Corporation; no Bylaw shall be adopted by
stockholders that shall impair or impede the implementation of the foregoing.
(c) The directors of the Corporation shall not be required to be
elected by written ballots.
(d) The Board of Directors of the Corporation, when evaluating any
offer of another party to (a) make a tender or exchange offer for any equity
security of the Corporation, (b) merge or consolidate the Corporation with
another corporation or (c) purchase or otherwise acquire all or substantially
all of the properties and assets of the Corporation, shall, in evaluating what
is in the best interests of the Corporation and its stockholders, consider not
only the consideration being offered by another party, in relation to the then
current market price, but also in relation to the then current value of the
Corporation in a freely negotiated transaction and in relation to the Board
of Directors' then estimate of the future value of the Corporation as an
independent entity. Furthermore, the Board of Directors is authorized, in
connection with the exercise of its judgment in determining what is in the
best interests of the Corporation and its stockholders, to give due
consideration to all relevant factors, including, without limitation, the
social, legal, and economic effects on the employees, cash customers,
suppliers and management services clients under contract to the Corporation
and its subsidiaries, and on the communities in which the Corporation and its
subsidiaries operate or are located.
(e) Notwithstanding any other provisions of this Certificate of
Incorporation or the Bylaws of the Corporation (and notwithstanding the fact
that a lesser percentage for separate class vote for certain actions may be
permitted by law, by this Certificate of Incorporation or by the Bylaws of the
Corporation), the affirmative vote of the holders of not less than 80% of the
votes entitled to be cast by the holders of all then outstanding shares of
capital stock, voting together as a single class, shall be required to make,
alter, amend, change, add to or repeal any provision of this Certificate of
Incorporation or the Bylaws of the Corporation which is or which is proposed
to be inconsistent with this Article VII; provided, however, that this Section
(c) shall not apply to, and such 80% vote shall not be required to alter,
amend, change, add to or repeal any provisions of the Bylaws relating to this
Article VII, or Article VII of this Certificate of Incorporation, recommended
by not less than 80% of the members of the Board of Directors.
(f) The invalidity or unenforceability of this Article VII or any
portion hereof, or of any action taken pursuant to this Article VII, shall not
affect the validity or enforceability of any other provision of this
Certificate of Incorporation, any action taken pursuant to such other
provision, or any action taken pursuant to this Article VII.
VIII.
DIRECTORS' LIABILITY
To the fullest extent permitted by the General Corporation Law of
Delaware, as the same exists or may hereafter be amended, a director of the
Corporation shall not be liable to the Corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director.
IX.
INDEMNIFICATION
Except as prohibited by law, the Corporation may indemnify any person
who is or was a director, officer, employee or agent of the Corporation or is
or was serving at the request of the Corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust
or other enterprise (including, without limitation, any employee benefit plan)
and may take such steps as may be deemed appropriate by the Board of
Directors, including purchasing and maintaining insurance, entering into
contracts (including, without limitation, contracts of indemnification between
the Corporation and its directors and officers), creating a trust fund,
granting security interests or using other means (including, without
limitation, a letter of credit) to ensure the payment of such amounts as may
be necessary to effect such indemnification.
X.
STOCKHOLDER VOTE FOR CERTAIN MATTERS
(a) In addition to any affirmative vote required by law, this
Certificate of Incorporation, or the Bylaws of the Corporation and except as
otherwise expressly provided in Section (b) of this Article X, a Business
Combination (as hereinafter defined) shall require the affirmative vote of the
holders of not less than 80% of the Voting Stock (as hereinafter defined),
voting together as a single class. Such affirmative vote shall be required
notwithstanding that no vote may be required or that a lesser percentage or
separate class vote may be allowed by law, any agreement with any national
securities exchange or the National Association of Securities Dealers, Inc.
(the "NASD"), or otherwise.
(b) The provisions of Section (a) of this Article X shall not be
applicable to any particular Business Combination, and such Business
Combination shall require only such affirmative vote, if any, as is required
by law, by any other provision of this Certificate of Incorporation or the
Bylaws of the Corporation, or by any agreement with any national securities
exchange or the NASD, if all of the conditions specified in either of the
following Paragraphs (1) or (2) are met:
(1) The Business Combination shall have been approved by 80% of
the Continuing Directors (as hereinafter defined), whether such approval
is made prior or subsequent to the acquisition of beneficial ownership
of the Voting Stock that caused the Interested Stockholder (as
hereinafter defined) to become an Interested Stockholder.
(2) All of the following price and procedural conditions shall
have been met:
(A) The aggregate amount of cash and the Fair Market Value
(as hereinafter defined), as of the date of the consummation of
the Business Combination (the "Consummation Date"), of the
consideration other than cash to be received per share by the
holders of Common Stock pursuant to such Business Combination
shall be at least equal to the higher amount determined under the
following clauses (i) and (ii):
(i) (if applicable) the highest per share price
(including any brokerage commissions, transfer taxes and
soliciting dealers' fees) paid by the Interested
Stockholder for any share of Common Stock acquired by it
(x) within the two-year period immediately prior to the
first public announcement of the proposal of the Business
Combination (the "Announcement Date"), or (y) the
transaction in which the Interested Stockholder became an
Interested Stockholder, whichever is higher; plus interest
compounded annually from the date on which the Interested
Stockholder became an Interested Stockholder (the
"Determination Date") through the Consummation Date at the
rate of interest announced by Barnett Bank in Jacksonville,
Florida (or other major bank headquartered in Atlanta,
Georgia, selected by a majority of the Continuing
Directors) from time to time as its "prime rate," less the
aggregate amount of any cash dividends paid and the Fair
Market Value of any dividends paid other than in cash, per
share of Common Stock from the Determination Date through
the Consummation Date in an amount up to but not exceeding
the amount of such interest payable per share of Common
Stock; or
(ii) (if applicable) the Fair Market Value per share
of the Common Stock on the Announcement Date or on the
Determination Date, whichever is higher.
(B) The aggregate amount of the cash and the Fair Market Value
as of the Consummation Date of the consideration other than cash to be
received per share by the holders of shares of any class or series of
outstanding Capital Stock (as hereinafter defined), other than Common
Stock, in such Business Combination shall be at least equal to the
highest amount determined under clauses (i), (ii) and (iii) below (it
being intended that the requirements of this Paragraph (2)(B) of this
Section (b) shall be required to be met with respect to every such class
or series of outstanding Capital Stock, whether or not the Interested
Stockholder has previously acquired any shares of a particular class or
series of Capital Stock):
(i) (if applicable) the highest per share price
(including any brokerage commissions, transfer taxes and
soliciting dealers' fees) paid by the Interested
Stockholder for any share of such class or series of
Capital Stock acquired by it (x) within the two-year period
immediately prior to the Announcement Date, or (y) the
transaction in which the Interested Stockholder became an
Interested Stockholder, whichever is higher; plus interest
compounded annually from the Determination Date through the
Consummation Date at the rate of interest announced by
Barnett Bank in Jacksonville, Florida (or other major bank
headquartered in Atlanta, Georgia, selected by a majority
of the Continuing Directors) from time to time as its
"prime rate," less the aggregate amount of any cash
dividends paid and the Fair Market Value of any dividends
paid other than in cash, per share of such class of Capital
Stock from the Determination Date through the Consummation
Date in an amount up to but not exceeding the amount of
such interest payable per share of such class of Capital
Stock;
(ii) (if applicable) the Fair Market Value per share
of such class or series of Capital Stock on the
Announcement Date or on the Determination Date, whichever
is higher; or
(iii)(if applicable) the highest preferential amount
per share to which the holders of shares of such class or
series of Capital Stock would be entitled in the event of
any voluntary or involuntary liquidation, dissolution or
winding up of the affairs of the Corporation, regardless
whether the Business Combination to be consummated
constitutes such an event.
(C) The consideration to be received by holders of a particular
class or series of outstanding Capital Stock in such Business
Combination shall be in cash or in the same form as previously has been
paid by or on behalf of the Interested Stockholder in connection with
its direct or indirect acquisition of beneficial ownership of shares of
such class or series of Capital Stock. If the consideration so paid for
shares of a class or series of Capital Stock varies as to form, the form
of consideration for such class or series of Capital Stock shall either
be cash or the form used to acquire beneficial ownership of the largest
number of shares of such class or series of Capital Stock previously
acquired by the Interested Stockholder; provided that if the Interested
Stockholder acquired equal portions of such shares by forms of
consideration other than cash, the form of consideration to be paid to
the holders of a class or series of Capital Stock shall be the form last
paid by the Interested Stockholder for previously acquired shares.
(D) The holders of all outstanding shares of Capital Stock not
beneficially owned by the Interested Stockholder prior to the
consummation of such Business Combination shall be entitled to receive
in such Business Combination cash or other consideration for their
shares in compliance with Paragraphs (2)(A), (2)(B) and (2)(C) of this
Section (b) (provided, however, that the failure of any such holders who
are exercising their statutory rights to dissent from such Business
Combination and receive payment of the fair value of their shares to
exchange their shares in such Business Combination shall not be deemed
to have prevented the condition set forth in this Paragraph (2)(D) of
this Section (b) from being satisfied).
(E) After the Determination Date and prior to the Consummation
Date:
(i) there shall have been no failure to declare and
pay at the regular date therefor any full quarterly
dividends (whether or not cumulative) payable in accordance
with the terms of any outstanding Capital Stock, except as
approved by a majority of the Continuing Directors;
(ii) there shall have been no reduction in the
annual rate of dividends paid on the Capital Stock (other
than as necessary to reflect any stock split, stock
dividend or subdivision of the Capital Stock), except as
approved by a majority of the Continuing Directors;
(iii)there shall have been an increase in the annual
rate of dividends paid on the Common Stock as necessary to
reflect any reclassification (including any reverse stock
split), recapitalization, reorganization, or any similar
transaction that has the effect of reducing the number of
outstanding shares of Common Stock, except as approved by
a majority of the Continuing Directors; and
(iv) such Interested Stockholder shall not have
become the beneficial owner of any additional shares of
Capital Stock except as part of a transaction that results
in such Interested Stockholder becoming an Interested
Stockholder.
(F) After the Determination Date, the Interested Stockholder
shall not have received the benefit, directly or indirectly (except
proportionately as a stockholder of the Corporation), of any loans,
advances, guarantees, pledges or other financial assistance or any tax
credits or other tax advantages provided by or through the Corporation,
whether in anticipation of or in connection with such Business
Combination or otherwise.
(G) A proxy or information statement describing the proposed
Business Combination and complying with the requirements of the
Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder (the "Exchange Act"), shall be mailed
to all stockholders of the Corporation at least 30 days prior to the
consummation of such Business Combination (whether or not such proxy or
information statement is required to be mailed under the provisions of
the Exchange Act).
The proxy or information statement shall contain on the first page
thereof, in a prominent place (or, if required, as near as practicable
to the first page thereof and in a prominent place), any statement
regarding the advisability (or inadvisability) of the Business
Combination that a majority of the Continuing Directors chooses to make,
and if deemed advisable by a majority of the Continuing Directors, the
opinion of an investment banking firm selected by a majority of the
Continuing Directors, concerning the fairness (or unfairness) of the
terms of the Business Combination from a financial viewpoint to the
holders of the outstanding shares of Capital Stock other than the
Interested Stockholder and its Affiliates or Associates (as hereinafter
defined), such investment banking firm to be paid a reasonable fee for
its services by the Corporation.
(c) For the purpose of this Article X, the following terms shall have
the respective meanings set forth below:
(1) "Affiliate" shall have the meaning ascribed to it in Rule
12b-2 promulgated under the Exchange Act as in existence on the date
this Article X was approved by the stockholders of the Corporation.
(The term "registrant" as used in Rule 12b-2 shall mean, in this case,
the Corporation.)
(2) "Associate" shall have the meaning ascribed to it in Rule
12b-2 promulgated under the Exchange Act as in existence on the date
this Article X was approved by the stockholders of the Corporation.
(The term "registrant" as used in Rule 12b-2 shall mean, in this case,
the Corporation.)
(3) "Beneficial Owner" shall mean a person who, either itself
or through any of its Affiliates or Associates,
(A) beneficially owns, directly or indirectly, any Capital
Stock;
(B) has, directly or indirectly,
(i) the right to acquire (whether such right is
exercisable immediately or subject only to the passage of
time) any Capital Stock pursuant to any agreement,
arrangement or understanding or upon the exercise of any
conversion rights, exchange rights, warrants, options or
otherwise; or
(ii) the right to vote any Capital Stock pursuant to
any agreement, arrangement or understanding; or
(C) beneficially owns, directly or indirectly, Capital
Stock through any other Person with which such Person or Affiliate
or Associate of such Person has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting or
disposing of any shares of Capital Stock.
For the purposes of determining whether a Person is an
Interested Stockholder pursuant to Paragraph (8) of this Section
(c), the number of shares of Capital Stock deemed to be
outstanding shall include shares deemed beneficially owned by such
Persons through application of this Paragraph (3) of this Section
(c), but shall not include any other shares of Capital Stock that
may be issuable pursuant to any agreement, arrangement or
understanding, or upon the exercise of any conversion rights.
(4) "Business Combination" shall mean:
(A) any merger or consolidation of the Corporation or any
Subsidiary (as hereinafter defined) with (i) any Interested
Stockholder, or (ii) any Person (whether or not itself an
Interested Stockholder) that is, or after such merger or
consolidation would be, an Affiliate or Associate of an Interested
Stockholder;
(B) any sale, lease, exchange, mortgage, pledge, transfer
or other disposition (in one transaction or a series of
transactions) with any Interested Stockholder or any Affiliate or
Associate of an Interested Stockholder involving any assets or
securities of the Corporation, any Subsidiary or any Interested
Stockholder or any Affiliate or Associate of an Interested
Stockholder, having an aggregate Fair Market Value equal to or in
excess of 25% of the total assets of the Corporation as shown on
the balance sheet of the Corporation contained in the most recent
annual report to stockholders of the Corporation;
(C) the adoption of any plan or proposal for the
liquidation or dissolution of the Corporation proposed by or on
behalf of an Interested Stockholder or any Affiliate or Associate
of an Interested Stockholder;
(D) any reclassification of securities (including any
reverse stock splits), recapitalization of the Corporation, merger
or consolidation of the Corporation with any of its Subsidiaries,
or any other transaction (whether or not with or otherwise
involving an Interested Stockholder) that has the effect, either
directly or indirectly, of increasing the proportionate share of
any class or series of Capital Stock or any securities convertible
into Capital Stock, or into equity securities of any Subsidiary
that is beneficially owned by any Interested Stockholder or an
Affiliate or Associate of an Interested Stockholder; or
(E) any agreement, contract, or other arrangement
providing for any one or more of the actions specified in
Paragraphs A through D of this Section (c)(4).
(5) "Capital Stock" shall mean capital stock of the Corporation
authorized to be issued from time to time pursuant to Article IV of this
Certificate of Incorporation.
(6) "Continuing Director" shall mean:
(A) any member of the Board of Directors of the
Corporation who, while such person is a member of the Board of
Directors, is not an Affiliate, Associate or representative of an
Interested Stockholder and was a member of the Board of Directors
prior to the time that the Interested Stockholder became an
Interested Stockholder; and
(B) any successor of a Continuing Director who, while such
successor is a member of the Board of Directors, is not an
Affiliate, Associate or representative of an Interested
Stockholder and is recommended or elected to succeed the
Continuing Director by a majority of the Continuing Directors.
(7) "Fair Market Value" shall mean:
(A) in the case of cash, the amount of such cash;
(B) in the case of stock, the highest closing sale price
during the 30-day period immediately preceding the date in
question of a share of such stock listed on any national
securities exchange registered under the Exchange Act or, if such
stock is not listed on any such exchange, the highest closing sale
quotation as reported by the NASD Automated Quotations system
("NASDAQ"), or if there is no closing sale quotation, the average
between the highest bid and asked prices with respect to a share
of such stock as quoted by NASDAQ for the 30-day period preceding
the date in question, or if no such quotations are available, the
Fair Market Value on the date in question of a share of such stock
as determined in good faith by a majority of the Continuing
Directors;
(C) in the case of property other than cash or stock, the
Fair Market Value of such property on the date in question as
determined in good faith by a majority of the Continuing
Directors; and
(D) in the event of any Business Combination in which the
Corporation is the surviving entity, either or both the shares of
Common Stock or the shares of any other class or series of Capital
Stock retained by the holders of such shares shall be deemed
consideration other than cash received for purposes of Paragraphs
(2)(A) and (2)(B) of Section (b) and Paragraph (4) of Section (d)
of this Article X.
(8) "Interested Stockholder" shall mean any Person (other than
the Corporation, any Subsidiary, or any profit-sharing, employee stock
ownership or other employee benefit plan established by the Corporation,
by any Subsidiary, or by any trustee of or fiduciary with respect to any
such plan when acting in such capacity) who:
(A) is the beneficial owner of Voting Stock representing 10%
or more of the votes entitled to be cast by the holders of all
then outstanding shares of Voting Stock;
(B) is an Affiliate or Associate of the Corporation and
that at any time within the two-year period immediately prior to
the date in question was the beneficial owner of Voting Stock
representing 10% or more of the votes entitled to be cast by the
holders of all then outstanding shares of Voting Stock; or
(C) is an assignee of or has otherwise succeeded to any
shares of Capital Stock that were at any time within the two-year
period immediately prior to the date in question beneficially
owned by any other Interested Stockholder if such assignment or
succession shall have occurred in the course of a transaction or
series of transactions not involving a public offering within the
meaning of the Securities Act of 1933, as amended.
(9) "Person" shall mean any individual, firm, corporation or
other entity and shall include any group comprised of any Person and any
other Person with whom such Person or any Affiliate or Associate of such
Person has any agreement, arrangement or understanding, either directly
or indirectly, for the purpose of acquiring, holding, voting or
disposing of Capital Stock.
(10) "Subsidiary" shall mean any corporation of which a majority
of any class of equity securities is beneficially owned by the
Corporation; provided, however, for the purposes of the definition of
Interested Stockholder as set forth in Paragraph (8) of this Section
(c), the term "Subsidiary" shall mean only a corporation of which a
majority of each class of equity security is beneficially owned by the
Corporation.
(11) "Voting Stock" shall mean all Capital Stock which by its
terms may be voted on the particular matter submitted to stockholders
of the Corporation.
(d) When it appears that a particular person may be an Interested
Stockholder and that the provisions of this Article X must be applied or
interpreted, then a majority of the total number of those directors of the
Corporation who would qualify as Continuing Directors (assuming that such
particular person is in fact an Interested Stockholder) shall have the power
and the duty to interpret all of the terms and provisions of this Article X,
and to determine on the basis of information known to them after reasonable
inquiry all facts necessary to ascertain compliance with this Article X,
including without limitation:
(1) whether a person is an Interested Stockholder;
(2) the number of shares of Capital Stock or other securities
beneficially owned by such person:
(3) whether a person is an Affiliate or Associate of another;
and
(4) whether the assets that are the subject of any Business
Combination have, or the consideration to be received for the issuance
or transfer of securities by the Corporation or any subsidiary in any
Business Combination has, in the aggregate a Fair Market Value equal to
or in excess of 25% of the total assets of the Corporation as shown on
the balance sheet of the Corporation contained in the most recent annual
report to stockholders of the Corporation. Any such determination shall
be made in good faith and shall be binding and conclusive on all
parties.
(e) Nothing contained in this Article X shall be construed to relieve
any Interested Stockholder from any fiduciary obligation imposed by law.
(f) Whether or not any Business Combination complies with the
provisions of Section (b) of this Article X shall not be construed to impose
any fiduciary duty, obligation or responsibility on the Board of Directors or
on any member thereof to approve such Business Combination or recommend its
adoption or approval to the stockholders of the Corporation, nor shall such
compliance limit, prohibit or otherwise restrict in any manner the Board of
Directors, or any member thereof, with respect to its or his evaluations of,
or actions and responses taken toward, such Business Combination.
(g) Notwithstanding any other provisions of this Certificate of
Incorporation or the Bylaws of the Corporation (and notwithstanding that a
lesser percentage or separate class vote may be permitted by law, this
Certificate of Incorporation or the Bylaws of the Corporation), the
affirmative vote of the holders of not less than 80% of the vote entitled to
be cast by the holders of all then outstanding shares of Voting Stock, voting
together as a single class, shall be required to make, alter, amend, change,
add to or repeal any provisions inconsistent with this Article X; provided,
however, that this Section (g) shall not apply to, and such 80% vote shall not
be required to alter, amend, change, add to or repeal any provisions of the
Bylaws relating to this Article X, or this Article X of the Certificate of
Incorporation, recommended by not less than 80% of the members of the Board
of Directors.
XI.
INCORPORATOR
The name and mailing address of the incorporator is:
Name Mailing Address
Pfilip G. Hunt Post Office Box 160266
Mobile, Alabama 36625
IN WITNESS WHEREOF, the undersigned, being the sole incorporated
hereinabove named, hereby further certifies that the facts herein stated are
true and, accordingly, has signed this Certificate of Incorporation this 12th
day of August, 1987.
/s/ Pfilip G. Hunt
Pfilip G. Hunt
RESTATED
BYLAWS
OF
MORRISON RESTAURANTS INC.
As in effect May 5, 1995
[Restated to reflect (i) change in name of RTMC Acquisition Incorporated to
Morrison Incorporated following the reincorporation in September 1987, (ii)
amendment to Section 7.1 adopted on September 26, 1989, (iii) change in name
from Morrison Incorporated to Morrison Restaurants Inc. on September 30, 1992,
(iv) amendments to Sections 3.2, Section 4.1 and 4.2 adopted on January 5, 1994
and (v) amendments to Sections 4.1 and 4.2 adopted on January 5, 1995, effective
as of May 5, 1995.]
INDEX
Page
ARTICLE I. OFFICES 1
ARTICLE II. STOCKHOLDERS' MEETINGS 1
SECTION 2.1 Places of Meetings 1
SECTION 2.2 Annual Meetings 1
SECTION 2.3 Special Meetings 1
SECTION 2.4 Meetings Without Notice 1
SECTION 2.5 Voting 1
SECTION 2.6 Quorum 2
SECTION 2.7 List of Stockholders 2
SECTION 2.8 Action Without Meeting 2
ARTICLE III. BOARD OF DIRECTORS 2
SECTION 3.1 Powers 2
SECTION 3.2 Number, Qualification and Term 2
SECTION 3.3 Compensation 3
SECTION 3.4 Meetings and Quorum 3
SECTION 3.5 Executive Committee 4
SECTION 3.6 Other Committees 4
SECTION 3.7 Conference Telephone Meetings 5
SECTION 3.8 Action Without Meeting 5
ARTICLE IV. OFFICERS 5
SECTION 4.1 Titles and Election 5
SECTION 4.2 Duties 6
(a) Chairman of the Board of Directors 6
(b) Vice Chairman of the Board of Directors 6
(c) President 6
(d) Vice President 6
(e) Secretary 7
(f) Treasurer 7
SECTION 4.3 Chief Executive Officer and Chief Operating Officer 7
SECTION 4.4 Chief Financial Officer and Chief Accounting Officer 7
SECTION 4.5 Delegation of Authority 7
SECTION 4.6 Compensation 8
ARTICLE V. RESIGNATIONS, VACANCIES AND REMOVALS 8
SECTION 5.1 Resignations 8
SECTION 5.2 Vacancies 8
(a) Directors 8
(b) Officers 8
SECTION 5.3 Removals 8
(a) Directors 8
(b) Officers 8
ARTICLE VI. CAPITAL STOCK 9
SECTION 6.1 Certificates of Stock 9
SECTION 6.2 Transfer of Stock 9
SECTION 6.3 Stock Transfer Records 9
SECTION 6.4 Record Dates 9
SECTION 6.5 Lost Certificates 10
ARTICLE VII. FISCAL YEAR, BANK DEPOSITS, CHECKS, ETC. 10
SECTION 7.1 Fiscal Year 10
SECTION 7.2 Bank Deposits, Checks, Etc. 10
ARTICLE VIII. BOOKS AND RECORDS 10
SECTION 8.1 Place of Keeping Books 10
SECTION 8.2 Examination of Books 10
ARTICLE IX. NOTICES 11
SECTION 9.1 Requirements of Notice 11
SECTION 9.2 Waivers 11
ARTICLE X. SEAL 11
ARTICLE XI. POWERS OF ATTORNEY 11
ARTICLE XII. INDEMNIFICATION OF DIRECTORS, OFFICERS,
EMPLOYEES AND OTHER PERSONS 12
SECTION 12.1Action Other Than by or in the Right of the Corporation 12
SECTION 12.2Action by or in the Right of the Corporation 12
SECTION 12.3Determination of Right of Indemnification 12
SECTION 12.4Indemnification Against Expenses of Successful Party 13
SECTION 12.5Advances of Expenses 13
SECTION 12.6Right of Agent to Indemnification Upon Application;
Procedure Upon Application 13
SECTION 12.7Other Rights and Remedies 13
SECTION 12.8Insurance of Agents 14
SECTION 12.9Certain Definitions 14
SECTION 12.10 Indemnification of Other Persons 14
SECTION 12.11 Survival of Indemnification 14
SECTION 12.12 Savings Clause 14
ARTICLE XIII AMENDMENTS 15
MORRISON RESTAURANTS INC.
RESTATED BYLAWS
ARTICLE I
OFFICES
The Corporation shall at all times maintain a registered office in the
State of Delaware and a registered agent at that address but may have other
offices located in or outside of the State of Delaware as the Board of
Directors may from time to time determine.
ARTICLE II
STOCKHOLDERS' MEETINGS
2.1 Places of Meetings. All meetings of stockholders shall be held at
such place or places in or outside of the State of Delaware as the Board of
Directors may from time to time determine or as may be designated in the
notice of meeting or waiver of notice thereof, subject to any provisions of
the laws of the State of Delaware.
2.2 Annual Meetings. The annual meeting of stockholders shall be held
on such date in the month of September each year and at such time as shall be
determined by the Board of Directors from time to time or with respect to any
particular annual meeting for the purpose of electing directors and
transacting such other business as may come properly before the meeting.
Written notice of the date, time and place of the annual meeting shall be
given by mail to each stockholder entitled to vote at his address as it
appears on the records of the Corporation not less than ten (10) nor more than
sixty (60) days prior to the scheduled date thereof, unless such notice is
waived as provided by Article IX of these Bylaws.
2.3 Special Meetings. A special meeting of stockholders may be called
at any time by the Board of Directors, the Chairman of the Board of Directors
or the President. Written notice of the time, place and specific purposes of
such meeting shall be given by mail to each stockholder entitled to vote
thereat at his address as it appears on the records of the Corporation not
less than ten (10) nor more than sixty (60) days prior to the scheduled date
thereof, unless such notice is waived as provided in Article IX of these
Bylaws.
2.4 Meetings Without Notice. Meetings of the stockholders may be held
at any time without notice when all the stockholders entitled to vote thereat
are present in person or by proxy.
2.5 Voting. At all meetings of stockholders, each stockholder entitled
to vote on the record date as determined under Article VI, Section 6.3 of
these Bylaws, or if not so determined, as prescribed under the laws of the
State of Delaware, shall be entitled to one vote for each share of stock
standing of record in his name, subject to any restrictions or qualifications
set forth in the Certificate of Incorporation, and may vote either in person
or by proxy.
2.6 Quorum. At any meeting of stockholders, a majority of the number
of shares of stock outstanding and entitled to vote thereat, present in person
or by proxy, shall constitute a quorum, but a smaller interest may adjourn any
meeting from time to time, and the meeting may be held as adjourned without
further notice, subject to such limitation as may be imposed under the laws
of the State of Delaware. At any such adjourned meeting at which a quorum is
present, any business may be transacted which might have been transacted at
the originally scheduled meeting.
When a quorum is present at any meeting, a majority of the number of
shares of stock entitled to vote present thereat shall decide any question
brought before such meeting, unless the question is one upon which a different
vote is required by express provision of the laws of the State of Delaware,
or the Certificate of Incorporation or these Bylaws, in which case such
express provision shall govern.
2.7 List of Stockholders. At least ten (10) days before every meeting,
a complete list of the stockholders entitled to vote at the meeting, arranged
in alphabetical order and showing the address of and the number of shares
registered in the name of each stockholder, shall be prepared by the Secretary
or the transfer agent in charge of the stock ledger of the Corporation. Such
list shall be open for examination by any stockholder, for any purpose germane
to the meeting, during ordinary business hours, for a period of at least ten
(10) days prior to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the notice of the
meeting, or, if not specified, at the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
during the whole time thereof, and may be inspected by any stockholder who is
present. The stock ledger shall be the only evidence as to who are the
stockholders entitled to examine such list or the books of the Corporation or
to vote in person or by proxy at such meeting.
2.8 Action Without Meeting. Any action required by the laws of the
State f Delaware or the Certificate of Incorporation to be taken at any annual
or special meeting of stockholders, or any action which may be taken at any
annual or special meeting of such stockholders, may be taken without a
meeting, without prior notice and without a vote, if a consent in writing,
setting forth the action so taken, shall be signed by all the holders of
outstanding stock entitled to vote at such meeting.
ARTICLE III
BOARD OF DIRECTORS
3.1 Powers. The business and affairs of the Corporation shall be
carried on by or under the direction of the Board of Directors, which shall
have all the powers authorized by the laws of the State of Delaware, subject
to such limitations as may be provided by the Certificate of Incorporation or
these Bylaws.
3.2 Number, Qualification and Term. The initial number of directors
shall be such as may be determined by the incorporator(s) and thereafter the
number of directors shall be not less than nine (9) and not more than twelve
(12), the exact number within such minimum and maximum limits to be fixed and
determined from time to time by resolution of a majority of the Board of
Directors or by the affirmative vote of the holders of at least 80% of all
outstanding shares of capital stock entitled to vote in the election of
directors, voting together as a single class, as provided in the Certificate
of Incorporation.
Directors shall be of full age, and no person shall be nominated for the
Board of Directors who shall have attained the age of seventy (70) on or
before the annual meeting of stockholders at which directors are elected,
provided, however, under special conditions in the best interests of the
Corporation, as determined by the Board of Directors or the shareholders, a
person may be nominated for the Board of Directors who has attained the age
of seventy (70) before such meeting. Directors need not be residents of the
State of Delaware, however, directors must be stockholders of the Corporation.
The initial Board of Directors shall be elected by the incorporator(s).
Thereafter, Directors shall be elected at the annual meeting of stockholders
by a plurality of the votes cast at such election. Each director shall serve
until the election and qualification of his successor or until his earlier
death, resignation or removal as provided in the Certificate of Incorporation
and these Bylaws. In case of an increase in the number of directors between
elections by the stockholders, the additional directorships shall be
considered vacancies and shall be filled in the manner prescribed in Article
V of these Bylaws.
The Board of Directors may, by majority vote, elect a Chairman of the
Board of Directors. The Chairman shall be a member of the Board and shall
preside at all meetings of the stockholders and of the Board of Directors and
shall have such other powers and perform such other duties as the Board of
Directors may prescribe from time to time.
3.3 Compensation. The Board of Directors, or a committee thereof, may
from time to time by resolution authorize the payment of fees or other
compensation to the directors for services as such to the Corporation,
including, but not limited to, fees for attendance at all meetings of the
Board of Directors or any committee thereof, and determine the amount of such
fees and compensation. Directors shall in any event be paid their traveling
expenses for attendance at all meetings of the Board of Directors or any
committee thereof. Nothing herein contained shall be construed to preclude
any director from serving the Corporation in any other capacity and receiving
compensation therefor in amounts authorized or otherwise approved from time
to time by the Board of Directors or a committee thereof.
3.4 Meetings and Quorum. Meetings of the Board of Directors may be
held either in or outside of the State of Delaware. A quorum shall be one-
third (1/3) of the number of directors then fixed in the manner provided in
Section 3.2 of this Article but not less than two (2) directors. The act of
a majority of the directors present at a meeting at which there is a quorum
shall be the act of the Board of Directors. If a quorum is not present at any
meeting, the Directors who are present may adjourn the meeting from time to
time, without notice other than announcement at the meeting, until a quorum
is obtained, subject to such limitation as may be imposed under the laws of
the State of Delaware.
The Board of Directors shall, at the close of each annual meeting of
stockholders and without further notice other than these Bylaws, if a quorum
of directors is then present or as soon thereafter as may be convenient, hold
a regular meeting for the election of officers and the transaction of any
other business.
The Board of Directors may from time to time provide for the holding of
regular meetings with or without notice and may fix the times and places at
which such meetings are to be held, meetings other than regular meetings may
be called at any time by the Chairman of the Board of Directors or the
President and must be called by the Chairman of the Board, the President, the
Secretary or an Assistant Secretary upon the request of at least three
directors.
Notice of each meeting, other than a regular meeting (unless required
by the Board of Directors), shall be given to each director by mailing the
same to each director at his residence or business address at least two (2)
days before the meeting or by delivering the same to him personally or by
telephone or telegraph at least one (1) day before the meeting unless, in case
of exigency, the Chairman of the Board of Directors, the President, the
Secretary or an Assistant Secretary, as the case may be, shall prescribe a
shorter notice to be given personally or by telephone, telegraph, cable or
facsimile transmission to all or any one or more of the directors at their
respective residences or places of business. Notice will be deemed to have
been given at the time it is mailed, postage-prepaid, or sent by telegraph,
cable or facsimile transmission, or given by telephone, as the case may be.
Notice of any meeting shall state the time and place of such meeting,
but need not state the purposes thereof unless otherwise required by the laws
of the State of Delaware, the Certificate of Incorporation or the Board of
Directors.
3.5 Executive Committee. The Board of Directors, by resolution adopted
by a majority of the number of directors then fixed in the manner provided in
Section 3.2 of this Article, may provide for an Executive Committee of three
or more directors and shall elect the members thereof to serve during the
pleasure of the Board of Directors. The Executive Committee shall elect its
own chairman, unless a chairman has been designated by the Board of Directors.
Special meetings of the Executive Committee may be called by the chairman of
the committee or by the Board of Directors, and notice of meetings of the
Executive Committee shall be given by the chairman of the committee or by the
Secretary, in the manner provided in Article IX of these Bylaws.
The Board of Directors may at any time change the membership of the
Executive Committee, fill vacancies in it, designate alternate members to
replace any absent or disqualified members at any meeting of the Executive
Committee, or dissolve it.
During the intervals between the meetings of the Board of Directors, the
Executive Committee shall possess and may exercise any or all of the powers
of the Board of Directors in the management or direction of the business and
affairs of the Corporation to the extent authorized by resolution adopted by
a majority of the number of directors then fixed in the manner provided in
Section 3.2 of this Article, subject to such limitations as may be imposed by
the laws of the State of Delaware.
Except as inconsistent with these Bylaws or the resolution of the Board
of Directors from time to time, the Executive Committee may determine its
rules of procedure and the notice to be given of its meeting, and it may
appoint such committees as it shall from time to time deem necessary. A
majority of the members of the Executive Committee shall constitute a quorum.
The Executive Committee shall keep minutes of its meetings and shall report
the same to the Board of Directors.
3.6 Other Committees. The Board of Directors may by resolution provide
for such other committees as it deems desirable and may discontinue the same
at its pleasure. Each such committee shall have the powers and perform such
duties, not inconsistent with law, as may be assigned to it by the Board of
Directors.
Each such committee shall elect its own chairman, unless a chairman has
been designated by the Board of Directors.
Except as inconsistent with these Bylaws or the resolution of the Board
of Directors from time to time, each such committee may determine its rules
of procedure and the notice to be given of its meeting, and it may appoint
such committees as it shall from time to time deem necessary. Special meetings
of any such committee may be called by the chairman of that committee or by
the Board of Directors, and notice of any meeting of any such committee shall
be given by the chairman of that committee or by the Secretary in the manner
provided in Article IX of these Bylaws. A majority of the members of any such
committee then in office shall constitute a quorum. Each such committee shall
keep minutes of its meetings and report the same to the Board of Directors.
3.7 Conference Telephone Meetings. Any one or more members of the
Board of Directors or any committee thereof may participate in a meeting by
means of a conference telephone or similar communication equipment by means
of which all persons participating in the meeting can hear each other, and
such participation shall constitute presence in person at such meeting.
3.8 Action Without Meeting. To the extent authorized by Delaware law,
any action required or permitted to be taken at any meeting of the Board of
Directors or any committee thereof may be taken without a meeting if all
members of the Board of Directors or committee, as the case may be, consent
thereto in writing, and the writing or writings are filed with the minutes of
the proceedings of the Board of Director or committee.
ARTICLE IV
OFFICERS
4.1 Titles and Election. The officers of the Corporation shall be the
Chairman of the Board of Directors, the Vice Chairman of the Board of
Directors, the President, one or more Vice Presidents, the Secretary and the
Treasurer, who shall have such authority and perform such duties as may be
prescribed by the Board of Directors or as otherwise provided in these Bylaws.
The Board of Directors, in its discretion, may also at any time elect
or appoint such other officers as it may deem advisable, each of whom shall
have such authority and shall perform such duties as may be prescribed or
determined from time to time by the Board of Directors or, if not prescribed
or determined by the Board of Directors, as the Chairman of the Board, the
President or the then senior executive officer may prescribe or determine.
The Board of Directors may assign such additional titles and duties to
one or more of the officers as it shall deem appropriate.
Any person may hold more than one office if the duties can be
consistently performed by the same person.
The officers of the Corporation shall initially be elected as soon as
convenient by the Board of Directors and thereafter, in the absence of earlier
deaths, resignations or removals, shall be elected at the first meeting of the
Board of Directors following each annual meeting of stockholders. Each
officer shall hold office at the pleasure of the Board of Directors except as
may otherwise be approved by the Board of Directors, or until his earlier
resignation, removal or other termination of his employment.
The Board of Directors may require any officer or other employee or
agent to give bond for the faithful performance of his duties in such form and
with such sureties as the Board may require.
4.2 Duties. Subject to such extension, limitations, and other
provisions as the Board of Directors may from time to time prescribe or
determine, the following officers shall have the following powers and duties:
(a) Chairman of the Board of Directors. The Chairman of the
Board of Directors shall be a director and, when present, shall preside
at all meetings of the stockholders and of the Board of Directors and
shall have such other powers and perform such other duties as the Board
of Directors may prescribe from time to time.
(b) Vice Chairman of the Board of Directors. The Vice Chairman
of the Board of Directors shall be a director and, in the absence of the
Chairman of the Board, shall preside at all meetings of the stockholders
and of the Board of Directors and shall have such other powers and
perform such other duties as the Board of Directors may prescribe from
time to time.
(c) President. The President shall exercise the powers and
authority and perform all of the duties commonly incident to his office
and shall perform such other duties as the Board of Directors shall
specify from time to time. In the absence or disability of the Chairman
of the Board, the President shall perform those duties of the Chairman
of the Board not assigned to the Vice Chairman of the Board, unless
otherwise provided by the Board of Directors.
(d) Vice President. The Vice President or Vice Presidents shall
perform such duties and have such powers as may be assigned to them from
time to time by the Board of Directors, the Chairman of the Board or the
President. Any Vice President may have the title of Executive Vice
President, Senior Vice President, Assistant Vice President or such other
title deemed appropriate by the Board of Directors from time to time.
In the absence or disability of the President, the Vice Presidents
in order of seniority may, unless otherwise determined by the Board of
Directors Or the Chairman of the Board, exercise the powers and perform
the duties pertaining to the office of the President.
(e) Secretary. The Secretary, or in his absence an Assistant
Secretary, shall keep the minutes of all meetings of stockholders and
of the Board of Directors and any committee thereof, cause all notices
to be duly given to and served on the stockholders and directors, attend
to such correspondence as may be assigned to him, keep or cause to be
kept in safe custody the seal and corporate records of the Corporation
and affix such seal to all such instruments properly executed as may
require it, have general charge of the stock transfer books of the
Corporation and shall in general perform all duties incident to his
office, and shall have such other duties and powers as may be prescribed
or determined from time to time by the Board of Directors, the Chairman
of the Board or the President.
In the absence or disability of the Secretary, the Assistant
Secretary, or if there he more than one, the Assistant Secretaries in
the order determined by the Board of Directors, or if no such
determination has been made, in the order of their election, shall
perform the duties and exercise the powers of the Secretary. Each
Assistant Secretary also shall perform such other duties and have such
other powers as may be assigned to him from time to time by the Board
of Directors, the Chairman of the Board or the President.
(f) Treasurer. The Treasurer shall have the care and custody of
and be responsible for the moneys, funds, securities, financial records
and other valuable papers of the Corporation (other than his own bond,
if any, which shall be in the custody of the President); shall keep full
and accurate accounts of receipts and disbursements and shall render
account thereof whenever required by the Board of Directors, the
Chairman of the Board or the President; shall have and perform, under
the supervision of the Board of Directors, all the powers and duties
commonly incident to his office: shall deposit or cause to be deposited
all funds of the Corporation in such bank or banks, trust company or
trust companies, or with such firm or firms doing a banking business as
may be designated by the Board of Directors, the Chairman of the Board
or the President; may endorse for deposit or collection all checks,
notes, and similar instruments payable to the Corporation or to its
order; and shall have such other duties as may be prescribed or
determined from time to time by the Board of Directors, the Chairman of
the Board or the President.
In the absence or disability of the Treasurer, the Assistant
Treasurer, or if there be more than one, the Assistant Treasurers in the
order determined by the Board of Directors, or if no such determination
has been made, in the order of their election, shall perform the duties
and exercise the powers of the Treasurer and such other duties as may
be assigned to them from time to time by the Board of Directors: the
Chairman of the Board or the President.
4.3 Chief Executive Officer and Chief Operating Officer. In its
discretion, the Board of Directors may designate either the Chairman of the
Board or the President to serve as the Chief Executive Officer or the Chief
Operating Officer, or both, of the Corporation.
The Chief Executive Officer shall, subject to the direction and control
of the Board of Directors, have general supervision, direction and control of
the business and officers of the Corporation and have the powers and duties
otherwise customary to the office.
The Chief Operating Officer shall, subject to the direction and control
of the Board of Directors, have general supervision, management and control
of the operations and personnel of the Corporation and the powers and duties
otherwise customary to the office.
4.4 Chief Financial Officer and Chief Accounting Officer. In its
discretion, the Board of Directors may at any time designate any officer as
the Chief Financial Officer, the Chief Accounting Officer, or both, of the
Corporation.
4.5 Delegation of Authority. The Board of Directors may at any time
delegate the powers and duties of any officer for the time being to any other
officer, director or employee.
4.6 Compensation. The compensation of the officers shall be fixed by
the Board of Directors or a committee thereof and the fact that any officer
is a director shall not preclude him from receiving compensation or from
voting upon the resolution providing the same.
ARTICLE V
RESIGNATIONS, VACANCIES AND REMOVALS
5.1 Resignations. Any director or officer may resign at any time by
giving written notice thereof to the Board of Directors, the Chairman of the
Board, the President or the Secretary. Any such resignation shall take effect
at the time specified therein or, if the time be not specified, upon receipt
thereof; and unless otherwise specified therein, the acceptance of any
resignation shall not be necessary to make it effective.
5.2 Vacancies.
(a) Directors. Any vacancy in the Board of Directors caused by
reason of death, incapacity, resignation, removal, increase in the
authorized number of directors or otherwise may be filled by a majority
vote of the remaining directors though less than a quorum, or by the
sole remaining director.
Any director so elected by the Board of Directors shall serve
until the next annual meeting of stockholders at which directors of the
class in which such director serves are to be elected and until the
election and qualification of his successor or until his earlier death,
resignation or removal as provided in the Certificate of Incorporation
or these Bylaws. The Board of Directors also may reduce their
authorized number by the number of vacancies in the Board, provided such
reduction does not reduce the Board to less than the minimum authorized
by the laws of the State of Delaware or to less than the number of
directors then in office.
(b) Officers. The Board of Directors may at any time or from
time to time fill any vacancy among the officers of the Corporation.
5.3 Removals.
(a) Directors. The entire Board of Directors, or any individual
member thereof, may be removed only as provided in the Certificate of
Incorporation.
(b) Officers. Subject to the provisions of any validly existing
agreement, the Board of Directors may at any meeting remove from office
any officer, with or without cause, and may elect or appoint a
successor.
ARTICLE VI
CAPITAL STOCK
6.1 Certificates of Stock. Every stockholder shall be entitled to a
certificate or certificates for shares of the capital stock of the Corporation
in such form as may be prescribed or authorized by the Board of Directors,
duly numbered and setting forth the number and kind of shares represented
thereby. Such certificates shall be signed by the Chairman of the Board, the
Vice Chairman of the Board, the President or Vice President, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary.
If and to the extent permitted by Delaware law, any or all of such signatures
may be in facsimile if the certificate is manually signed on behalf of a
transfer agent or a registrar, other than the Corporation itself or an
employee of the Corporation.
In case any officer, transfer agent or registrar who has signed or whose
facsimile signature has been placed on a certificate has ceased to be such
officer, transfer agent or registrar before the certificate has been issued,
such certificate may nevertheless be issued and delivered by the Corporation
with the same effect as if he were such officer, transfer agent or registrar
at the date of issue.
6.2 Transfer of Stock. Shares of the capital stock of the Corporation
shall be transferable only upon the books of the Corporation upon the
surrender of the certificate or certificates properly assigned and endorsed
for transfer.
The Board of Directors may appoint a transfer agent and one or more co-
transfer agents and a registrar and one or more co-registrars and may make or
authorize such agents to make all such rules and regulations deemed expedient
concerning the issue, transfer and registration of shares of stock. If the
Corporation has a transfer agent or registrar acting on its behalf, the
signature of any officer or representative thereof may be in facsimile.
6.3 Stock Transfer Records. Unless the Corporation has a stock
transfer agent to keep such records, the Secretary shall keep a stock book or
books containing the names, alphabetically arranged, with the address of every
stockholder showing the number of shares of each kind, class or series of
stock held of record.
The person in whose name shares of stock stand on the books of the
Corporation shall be deemed by the Corporation to be the owner thereof for all
purposes.
6.4 Record Dates. In order that the Corporation may determine the
stockholders entitled to notice of or to vote at any meeting of stockholders
or any adjournment thereof, or to express consent to corporate action in
writing without a meeting, or entitled to receive payment of any dividend or
other distribution or allotment of any rights, or entitled to exercise any
rights in respect of any change, conversion or exchange of stock or for the
purpose of any other lawful action, the Board of Directors shall fix in
advance a record date which, in the case of a meeting, shall not be less than
ten (10) nor more than sixty (60) days prior to the scheduled date of such
meeting and which, in the case of any other action, shall be not more than
sixty (60) days prior to any such action permitted by the laws of the State
of Delaware.
A determination of stockholders of record entitled to notice of or to
vote at a meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board of Directors may fix a new record
date for the adjourned meeting.
6.5 Lost Certificates. In case of loss, mutilation or destruction of
a stock certificate, a duplicate certificate may be issued upon such terms as
may be determined or authorized by the Board of Directors, the Chairman of the
Board or the President.
ARTICLE VII
FISCAL YEAR, BANK DEPOSITS, CHECKS, ETC.
7.1 Fiscal Year. The fiscal year of the Corporation shall end on the
first Saturday following May 30 each year.
7.2 Bank Deposits, Checks, Etc. The funds of the Corporation shall be
deposited in the name of the Corporation or of any division thereof in such
banks or trust companies in the United States or elsewhere as may be
designated from time to time by the Board of Directors, or by such officer or
officers as the Board of Directors may authorize to make such designations.
All checks, drafts or other orders for the withdrawal of funds from any
bank account shall be signed by such person or persons as may be designated
from time to time by the Board of Directors. The signatures on checks, drafts
or other orders for the withdrawal of funds may be in facsimile if authorized
in the designation.
ARTICLE VIII
BOOKS AND RECORDS
8.1 Place of Keeping Books. The books and records of the Corporation
may be kept in or outside of the State of Delaware, as the Board of Directors
may from time to time determine.
8.2 Examination of Books. Except as may otherwise be provided by the
laws of the State of Delaware, the Certificate of Incorporation or these
Bylaws, the Board of Directors shall have power to determine from time to time
whether and to what extent and at what times and places and under what
conditions any of the accounts, records and books of the Corporation are to
be open to the inspection of any stockholder. No stockholder shall have any
right to inspect any account or book or document of the Corporation except as
prescribed by law or authorized by express resolution of the stockholders or
of the Board of Directors.
ARTICLE IX
NOTICES
9.1 Requirements of Notice. Whenever notice is required to be given
by statute, the Certificate of Incorporation or these Bylaws, it shall not
mean personal notice unless so specified, but such notice may be given in
writing by depositing the same in a post office, letter box, or mail chute
postage prepaid and addressed to the person to whom such notice is directed
at the address of such person on the records of the Corporation, and such
notice shall be deemed given at the time when the same shall be thus mailed.
9.2 Waivers. Any stockholder, director or officer may, in writing or
by telegram or cable, at any time waive any notice or other formality required
by statute, the Certificate of Incorporation or these Bylaws. Such waiver of
notice, whether given before or after any meeting or action, shall be deemed
equivalent to notice. Presence of a stockholder either in person or by proxy
at any meeting of stockholders and presence of any director at any meeting of
the Board of Directors shall constitute a waiver of such notice as may be
required by any statute, the Certificate of Incorporation or these Bylaws.
ARTICLE X
SEAL
The corporate seal of the Corporation shall be in such form as the Board
of Directors shall determine from time to time and may consist of a facsimile
thereof or the words "Corporate Seal" or "Seal" enclosed in parentheses.
In the absence of the Secretary, any other officer of the Corporation
may affix and attest the seal of the Corporation to any instrument requiring
it, unless otherwise provided by resolution of the Board of Directors.
ARTICLE XI
POWERS OF ATTORNEY
The Board of Directors may authorize one or more of the officers of the
Corporation to execute powers of attorney delegating to named representatives
or agents power to represent or act on behalf of the Corporation, with or
without power of substitution.
In the absence of any action by the Board of Directors, any officer of
the Corporation may execute for and on behalf of the Corporation waivers of
notice of meetings of stockholders and proxies for such meetings of any
company in which the Corporation may hold voting securities.
ARTICLE XII
INDEMNIFICATION OF DIRECTORS, OFFICERS,
EMPLOYEES AND OTHER PERSONS
12.1 Action Other Than by or in the Right of the Corporation. Subject
to Section 12.3 hereof, the Corporation shall indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative,
and whether external or internal to the Corporation (other than a judicial
action or suit brought by or in the right of the Corporation), by reason of
the fact that he is or was a director or officer of the Corporation, or is or
was serving at the request of the Corporation as a director or officer of
another corporation, partnership, joint venture, trust or other enterprise
(all such persons being referred to hereafter as an "Agent"), against expenses
(including attorneys' fees), judgments. fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit
or proceeding if he acted in good faith and in an manner he reasonably
believed to be in or not opposed to the best interests of the Corporation, and
with respect to any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction or upon a plea of nolo
contendere or its equivalent, shall not, of itself create a presumption that
the person did not act in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the Corporation, and
with respect to any criminal action or proceeding, that he had reasonable
cause to believe that his conduct was unlawful.
12.2 Action by or in the Right of the Corporation. The Corporation
shall indemnify any person who was or is a party or is threatened to be made
a party to any threatened, pending or completed judicial action or suit
brought by or in the right of the Corporation to procure a judgment in its
favor by reason of the fact that he is or was an Agent against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted
in good faith and in a manner he reasonably believed to be in or not opposed
to the best interests of the Corporation, except that no indemnification shall
be made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable to the Corporation unless and only to the
extent that the Court of Chancery or the court in which such action or suit
was brought shall determine upon application that, despite the adjudication
of liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity of such expenses which the Court
of Chancery or other such court shall deem proper.
12.3 Determination of Right of Indemnification. Any indemnification
under Sections 12.1 or 12.2 hereof (unless ordered by a court) shall be made
by the Corporation unless a determination is reasonably and promptly made
(i) by the Board of Directors by a majority vote of a quorum consisting of
directors who are or were not parties to such action, suit or proceeding, or
(ii) if such a quorum is not obtainable, or, even if obtainable, if a quorum
of disinterested directors so directs, by independent legal counsel in a
written opinion, or (iii) by the stockholders, that such person acted in bad
faith and in a manner that such person did not believe to be in or not opposed
to the best interests of the Corporation, or, with respect to any criminal
proceeding, that such person believed or had reasonable cause to believe that
his conduct was unlawful.
12.4 Indemnification Against Expenses of Successful Party.
Notwithstanding the other provisions of this Article XII, to the extent that
an Agent has been successful on the merits or otherwise, including the
dismissal of an action without prejudice or the settlement of an action
without admission of liability, in defense of any proceeding or in defense of
any claim, issue or matter therein, such Agent shall be indemnified against
all expenses incurred in connection therewith.
12.5 Advances of Expenses. Except as limited by Section 12.6. expenses
incurred in defending or investigating any action, suit, proceeding or
investigation shall be paid by the Corporation in advance of the final
disposition of such matter, if the Agent shall undertake to repay such amount
in the event that it is ultimately determined, as provided herein, that such
person is not entitled to indemnification. However, no advance shall be made
by the Corporation if a determination is reasonably and promptly made by the
Board of Directors by a majority vote of a quorum of disinterested directors,
or (if such a quorum is not obtainable or, even if obtainable, a quorum of
disinterested directors so directs) by independent legal counsel in a written
opinion, that, based upon the facts known to the Board of Directors or counsel
at the time such determination is made, such person acted in bad faith and in
a manner that such person did not believe to be in or not opposed to the best
interests of the Corporation, or, with respect to any criminal proceeding,
that such person believed or had reasonable cause to believe his conduct was
unlawful. In no event shall any advance be made in instances where the Board
of Directors or independent legal counsel reasonably determines that such
person deliberately breached his duty to the Corporation or its stockholders.
12.6 Right of Agent to Indemnification Upon Application; Procedure Upon
Application. Any indemnification under Sections 12.2, 12.3 and 12.4 hereof
or advance under Section 12.5 hereof shall be made promptly and in any event
within 45 days, upon the written request of the Agent, unless with respect to
applications under Sections 12.2, 12.3 or 12.5 hereof, a determination is
reasonably and promptly made by the Board of Directors by a majority vote of
a quorum of disinterested directors that such Agent acted in a manner set
forth in such Sections as to justify the Corporation not indemnifying or
making an advance to the Agent. In the event no quorum of disinterested
directors is obtainable, the Board of Directors shall promptly direct that
independent legal counsel shall decide whether the Agent acted in the manner
set forth in such Sections as to justify the Corporation not indemnifying or
making an advance to the Agent. The right to indemnification or advances as
granted by this Article XIl shall be enforceable by the Agent in any court of
competent jurisdiction if the Board of Directors or independent legal counsel
denies the claim, in whole or in part, or if no disposition of such claim is
made within 45 days. The Agent's expenses incurred in connection with
successfully establishing his right to indemnification, in whole or in part,
in any such proceeding shall also be indemnified by the Corporation.
12.7 Other Rights and Remedies. The indemnification provided by this
Article XII shall not be deemed exclusive of any other rights to which an
Agent seeking indemnification may be entitled under any agreement, vote of
stockholders or disinterested directors, court order or otherwise, both as to
action in his official capacity and as to action in another capacity while
holding such office. It is the policy of the Corporation that indemnification
of Agents shall be made to the fullest extent permitted by law. All rights
to indemnification under this Article XII shall be deemed to be provided by
a contract between the Corporation and the Agent who serves in such capacity
at any time while these Bylaws and other relevant provisions of the General
Corporation Law of the State of Delaware and other applicable law, if any, are
in effect. Any repeal or modification thereof shall not affect any rights or
obligations then existing.
12.8 Insurance of Agents. To the extent permitted by Delaware law, the
Corporation may purchase and maintain insurance on behalf of any person who
is or was an Agent against any liability asserted against him and incurred by
him in any such capacity, or arising out of his status as such, whether or not
the Corporation would have the power to indemnify him against such liability
under the provisions of this Article XII.
12.9 Certain Definitions. For purposes of this Article XII, references
to the "Corporation" shall include, in addition to the resulting or surviving
corporation, any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power to indemnify its directors,
officers and employees or agents, so that any person who is or was a director,
officer, employee or agent of such constituent corporation, or is or was
serving at the request of such constituent corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust
or other enterprise, shall stand in the same position under this Article XII
with respect to the resulting or surviving corporation as he would have with
respect to such constituent corporation if its separate existence had
continued; references to "other enterprises" in Section 1 shall include
employee benefit plans; references to "fines" shall include any excise taxes
assessed a person with respect to any employee benefit plan; and references
to "serving at the request of the Corporation" shall include any service as
a director or officer of the Corporation which imposes duties on, or involves
services by, such director or officer with respect to any employee benefit
plan, its participants, or beneficiaries; and a person who acted in good faith
and in a manner he reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan shall be deemed to
have acted in a manner "not opposed to the best interests of the Corporation"
as referred to in this Article XII.
12.10 Indemnification and Insurance of Other Persons. The provisions
of this Article XII shall not be deemed to preclude the Corporation from
either indemnifying or purchasing and maintaining insurance on behalf of, or
both, any person who is not an Agent but whom the Corporation has the power
or obligation to indemnify or insure under the provisions of the General
Corporation Law of the State of Delaware or otherwise. The Corporation may,
in its sole discretion, indemnify or insure, or both, an employee, trustee or
other agent as permitted by the General Corporation Law of the State of
Delaware. The Corporation shall indemnify or insure any employee, trustee or
other agent where required by law.
12.11 Survival of Indemnification. The indemnification and advancement
of expenses provided by, or granted pursuant to, this Article XII shall
continue as to a person who has ceased to be an Agent and shall inure to the
benefit of the heirs, executors and administrators of such Agent.
12.12 Savings Clause. If this Article XII or any portion thereof shall
be invalidated on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify each Agent against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
with respect to any action, suit or proceeding, whether civil, criminal,
administrative or investigative, and whether internal or external, including
a grand jury proceeding and an action or suit brought by or in the right of
the Corporation, to the full extent permitted by any applicable portion of
this Article XII that shall not have been invalidated, or by any other
applicable law.
ARTICLE XIII
AMENDMENTS
Unless otherwise provided by law, the Certificate of Incorporation or
another provision of these Bylaws, these Bylaws may be amended or repealed
either:
(a) at any meeting of stockholders at which a quorum is present
by vote of the holders of a majority of the number of shares of stock
entitled to vote present in person or by proxy at such meeting as
provided in Article II, Sections 2.4 and 2.5 of these Bylaws, or
(b) at any meeting of the Board of Directors by a majority vote
of the directors then in office;
provided the notice of such meeting of stockholders or directors or waiver of
notice thereof contains a statement of the substance of the proposed amendment
or repeal.
TABLE OF CONTENTS
Page
ARTICLE I PURPOSE OF PLAN 2
ARTICLE II DEFINITIONS AND CONSTRUCTION 3
ARTICLE III SUPPLEMENTAL RETIREMENT BENEFITS 7
ARTICLE IV RETIREMENT OF PARTICIPANTS 8
ARTICLE V VESTING AND DISTRIBUTION OF BENEFITS 9
ARTICLE VI CONDITIONS AND FORFEITURES 11
ARTICLE VII ADMINISTRATIVE COMMITTEE 12
ARTICLE VIII MISCELLANEOUS 14
MORRISON INCORPORATED
EXECUTIVE SUPPLEMENTAL PENSION PLAN
(Effective May 27, 1983)
(Restated June 1, 1986)
NOTE: This document is an important legal instrument with legal and tax
implications. It should be reviewed by legal counsel prior to adoption.
ARTICLE I
PURPOSE OF PLAN
The purpose of the Plan, as effective May 27, 1983, and as more fully set
forth herein, is to provide supplemental retirement benefits to Eligible
Employees as part of an integrated executive compensation program. The Plan
shall be maintained on an unfunded basis.
The Plan has been restated in its entirety effective June 1, 1986, primarily
to give a more complete description of the method of determining plan
participation, benefit service, and normal and early retirement benefits.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.01 Definitions:
(a) The term "Annual Base Salary" refers to the base pay and sales
commissions, if payable, received by a Participant from an
Employer during a calendar year, and excluding any amounts paid
to him as overtime, bonuses, incentive compensation, and
contributions to this or any other pension benefit plan to which
an Employer contributes directly or indirectly.
(b) The term "Accrued Benefit" refers to the annual benefit to which
a Participant would be entitled, determined pursuant to Section
3.01, based on his Final Base Salary and his Continuous Service
at the date of calculation, commencing on his Normal Retirement
Date in the mode of a single-life annuity.
(c) The term "Board" refers to the Board of Directors of the Company,
as duly constituted from time-to-time.
(d) The term "Committee" refers to those three members of the Board
who shall be appointed by the Board to manage and administer the
Plan in accordance with the provisions of Article VII hereof.
(e) The term "Company" refers to Morrison Incorporated, a Florida
corporation, having its administrative offices in Mobile, Alabama.
(f) The term "Continuous Service" refers to the period of unbroken
employment of an Employee with the Company or one or more of its
subsidiaries from his last date of employment, but shall not
include a period of employment beyond the Participant's Normal
Retirement Date.
Continuous Service shall not include a period of employment
subsequent to an Employee's participation in this Plan if the
Employee's HAY points are less than 850 in the period.
Furthermore, Continuous Service shall not include a period of
employment subsequent to an Employee's participation in this Plan
if the Committee has expressly terminated an Employee's
participation in this Plan.
Continuous Service of an Employee shall not be broken by and shall
include the periods of:
(1) his absence in the Armed Forces of the United States or any
of its allies in time of war in which the United States
shall be engaged, or in the Armed Forces of the United
States while any form of law requiring compulsory military
service shall be in effect, if the Employee directly enters
such Armed Forces and does not reenlist after the date of
first entering and makes application for reemployment by
the Company within ninety (90) days, or such longer period
as may be prescribed by applicable law, after discharge or
release from such Armed Forces or from hospitalization
continuing for a period of not more than one year after
discharge or release from such Armed Forces and is
reemployed by the Company; and/or
(2) his absence because of lay-off not in excess of one (1)
years if the Employee returns to employment with the
Company when notified of his recall to work.
An Employee whose Continuous Service has been broken
because of termination employment and who is thereafter
reemployed by the Company shall be deemed to be newly
employed for all purposes of the Plan and any previous
service shall be disregarded for purposes of the Plan.
An Employee whose Continuous Service has been broken
because his HAY points have dropped to less than 850 or
because the Committee acted to terminate his participation
in the Plan and who subsequently has 850 or more HAY points
or who subsequently has his participation in this Plan
reinstated by action of the Committee shall have his
periods of Continuous Service aggregated for purposes of
calculating his Accrued Benefit.
(g) The term "Effective Date" shall mean May 27, 1983.
(h) The term "Eligible Employee" refers to any individual employed on
a full-time basis by the Company or one or more of its
subsidiaries, who has earned at least 850 HAY points, has three
(3) years of service as a year of service is defined in Morrison
Incorporated Retirement Plan, and has been selected for
participation by the Committee.
(i) The term "Final Base Salary" refers to the dollar amount
determined by obtaining the average of the Participant's Annual
Base Salary over the five (5) consecutive Plan Years which produce
the highest average. If the Participant retires, terminates
employment, or ceases to accrue Continuous Service due to a drop
in HAY points or action of the Committee, his Annual Base Salary
for the final partial year of participation shall be annualized
for purposes of calculating the Final Base Salary.
As an example of the manner in which this definition is intended
to operate, assume a Participant earns an Annual Base Salary of
Sixty Thousand Dollars ($60,000) in the fourth and third Plan
Years preceding the Plan Year in which he reaches his Normal
Retirement Date, and an Annual Base Salary of Eighty Thousand
Dollars ($80,000) in the second and first Plan Years preceding
such year, as well as in the year of his normal retirement.
Assume further that in all other Plan Years, the Participant's
Annual Base Salary was less than $60,000. Based on such
assumptions, the Participant's Final Base Salary will equal:
$ 60,000
60,000
80,000
80,000
80,000 $360,000/5 = $72,000
$360,000
(j) The term "Normal Retirement Date" refers to the 65th anniversary
of the Participant's birth.
(k) The term "Participant" refers to any Eligible Employee upon his
entry into the Plan. Upon retirement, termination of employment,
or if a Participant's HAY points drop to less then 850 or if the
Committee acts to terminate the participation of an Employee under
this Plan, such Employee's status as a Participant will be
terminated, and he will be classified as a former Participant.
(l) The term "Plan" refers to the unfunded supplemental retirement
plan embodied herein, as amended from time-to-time, to be known
as the Morrison Incorporated Executive Supplemental Pension Plan.
(m) The term "Plan Year" refers to any calendar year within which the
Plan shall be in effect.
(n) The term "Primary Social Security Benefit" means the annual
primary insurance amount available to the Participant at age 65
under the Social Security Act as in effect at the date of
calculation, without regard to whether such amount actually
commences to be paid and without regard to any increase in the
Social Security Base or benefit levels that may take effect after
such date of calculation.
The Primary Social Security Benefit will be calculated as though
the Participant had a full Social Security Earnings Record and as
though the Participant always earned at least the Social Security
Taxable Wage Base.
The date of calculation will be the retirement date, termination
date, date when HAY points drop below 850, or date of cessation
of participation as determined by the Committee, whichever is
applicable. The Primary Social Security Benefit will be
calculated based on the Social Security Law in effect on the first
day of the calendar year of the date of calculation, and assuming
constant Social Security Taxable Wage Bases for the future years.
2.02 Construction:
(a) Words used herein in the masculine or feminine gender shall be
construed as the feminine or masculine gender, respectively, where
appropriate.
(b) Words used herein in the singular or plural shall be construed as
the plural or singular, respectively, where appropriate.
ARTICLE III
SUPPLEMENTAL RETIREMENT BENEFITS
3.01 Amount of Benefit:
A Participant's Accrued Benefit payable at Normal Retirement Date in the
form of single life annuity shall equal (A) plus (B) minus (C) minus (D)
as follows:
(A) 2.5% of the Participant's Final Base Salary multiplied by the
Participant's years and fractional years of Continuous Service not
in excess of twenty (20) years of Continuous Service; plus
(B) 1% of the Participant's Final Base Salary multiplied by the
Participant's years and fractional years of Continuous Service in
excess of twenty (20) years of Continuous Service, but not in
excess of thirty (30) such years; less
(C) The retirement benefit payable at Normal Retirement Date in the
form of a single life annuity to the Participant under the
Morrison Incorporated Retirement Plan; less
(D) The Participant's Primary Social Security Benefit, calculated in
accordance with Section 2.01(n).
For purposes of this Section 3.01, each completed month of Continuous
Service shall equal one-twelfth (1/12th) of a year of Continuous
Service.
3.02 Distribution of Benefits:
Benefits accrued hereunder shall be paid in accordance with Article V.
3.03 Encumbrance of Award:
No Participant or beneficiary of a Participant shall have any right to
commute, encumber, transfer or otherwise dispose of or alienate any
present or future right or expectancy which he may have at any time to
receive payment of benefits, which benefits and the right thereto are
expressly declared to be non-assignable and non-transferable. Any
attempt to transfer or assign a benefit, or any rights granted
hereunder, by a Participant or his beneficiaries shall, in the sole
discretion of the Committee after consideration of such facts as it
deems pertinent, be grounds for terminating any rights of the
Participant and his beneficiaries to any portion of the benefits not
previously paid by the Company.
ARTICLE IV
RETIREMENT OF PARTICIPANTS
4.01 Normal Retirement:
A Participant may continue in the service of the Company beyond his
Normal Retirement Date, but shall not be permitted to continue in the
employ of the Company without first obtaining the Company's consent,
subsequent to the age at which the Company may require the retirement
of the Participant under applicable federal and state laws. If a
Participant continues in service beyond his Normal Retirement Date, he
shall be deemed to be retired upon his Postponed Retirement Date as
determined under the Morrison Incorporated Retirement Plan.
4.02 Early Retirement:
A Participant may retire from service with the Company or any of its
subsidiaries prior to reaching his Normal Retirement Date and commence
receiving benefits from this Plan if eligible for Early Retirement under
the terms of the Morrison Incorporated Retirement Plan. The Accrued
Benefit under this Plan, as described in Section 3.01, will be reduced
for Early Retirement using the same factors as are used in the Morrison
Incorporated Retirement Plan, namely:
<TABLE>
<CAPTION>\
Age Early Retirement Factor
<S> <C>
64 .93
63 .86
62 .79
61 .72
60 .65
59 .62
58 .59
57 .56
56 .53
55 .50
</TABLE>
A Participant must commence receiving benefits under this Plan at the
same time as he commences receiving benefits under the Morrison
Incorporated Retirement Plan.
ARTICLE V
VESTING AND DISTRIBUTION OF BENEFITS
5.01 Vesting:
A Participant's Accrued Benefit shall vest in the Participant at such
time as he reaches his Normal or Early Retirement Date. If a
Participant terminates employment other than by retirement or death, he
shall be vested in his Accrued Benefit is he has completed ten (10) or
more Years of Service determined under the Morrison Incorporated
Retirement Plan. If a Participant terminates employment other than by
retirement or death and has not completed ten (10) or more Years of
Service determined under the Morrison Incorporated Retirement Plan, he
shall not be vested in his Accrued Benefit, his Accrued Benefit shall
be cancelled and he shall not be entitled to any further benefits from
the Plan.
5.02 Payment of Benefits:
When a Participant reaches his Normal Retirement Date, retires by reason
of the Early Retirement provisions of the Plan (Section 4.02), or
otherwise terminates his service with the Company or any of its
subsidiaries, the Committee shall determine and certify to the Treasurer
of the Company the vested Accrued Benefit of the Participant, if any,
and shall further determine and certify the method by which payments
shall be made. The Company shall thereafter make payments of the
benefits in the manner and at the times so designated, subject, however,
to all other terms and conditions of the Plan.
A benefit payable under this Plan shall be paid in the same form and at
the same time as the retirement benefit payable to the retired
Participant under the Morrison Incorporated Retirement Plan. If the
benefit payable under this Plan is paid other than as a life annuity,
the amount of the benefit when paid in such other form shall be
determined by using the actuarial equivalence factors of the Morrison
Incorporated Retirement Plan.
5.03 Death of Participant:
If a Participant shall die during the term of his employment with the
Company or any of its subsidiaries, and prior to his retirement or other
termination from service, the said employment shall be deemed to have
terminated on the date of the Participant's death and the Company shall
have no further obligation to the Participant, his estate, heirs or
beneficiaries under this Plan, it being specifically the intention of
the Board in creating this Plan that it supplement, by way of providing
living retirement benefits, the existing insurance benefit program which
will protect the interests of the families of executive employees who
die while in the Continuous Service of the Company or any of its
subsidiaries.
If a Participant shall die after his retirement or other termination of
service, benefit payments shall continue to the Participant's designated
beneficiaries, or his estate, at such times and in such manner, as is
provided for under the form of payment determined under the provisions
of Section 6.02 of the Plan. Each Participant shall notify the
Committee in writing of the name and address of his primary alternative
beneficiaries, which may be changed from time-to-time by the Participant
by written notice delivered to the Committee.
ARTICLE VI
CONDITIONS AND FORFEITURES
If a Participant's Continuous Service is terminated because of his proven or
admitted fraud or dishonesty of a material nature, his willful damage to the
property, reputation or goodwill of the Company, or any of its subsidiaries,
his conviction of a felony, his willful and material insubordination or
violation of Company rules, and/or his gross neglect of duties assigned by the
Company; and if such act or action adversely affects the Company in a
substantial respect, then notwithstanding any other provision of this Plan,
the Committee may determine that any benefits to which such Participant might
otherwise have been entitled under the Plan shall be forfeited. The decision
of the Committee with respect to sufficiency of the proof or admission of such
act or action, the substantially adverse effect thereof, and the forfeiture
resulting therefrom, as long as made with consistency and sound judgment,
shall be final and binding.
ARTICLE VII
ADMINISTRATIVE COMMITTEE
7.01 Service, Resignation, Removal:
Members of the Committee shall serve at the pleasure of the Board and
any or all members may be removed by the Board at any time, with or
without cause or notice. Upon the death, resignation, removal or
inability to serve of any member of the Committee, as now or hereafter
constituted (and of such inability the Board shall be the sole judge),
the Board shall name the successor of such member.
7.02 Procedure:
A majority of the members of the Committee shall constitute a quorum for
any meeting held with respect to the Plan, and the acts of a majority
of the members present at any meeting at which a quorum is present or
the acts unanimously approved in writing by all such members shall be
valid acts of the Committee.
7.03 Powers and Duties:
The Committee shall have the power and duty to do all things necessary
or convenient to effect the intent and purposes of the Plan and not
inconsistent with any of the provisions hereof, whether or not such
powers and duties are specifically set forth herein, and, in
amplification and not limitation of the foregoing, the Committee shall
have power to:
(a) provide rules and regulations for the administration of the Plan,
and from time-to-time, to amend or supplement such rules and
regulations;
(b) construe the Plan, which construction, as long as made in good
faith, shall be final and conclusive upon all parties thereto;
(c) correct any defect, supply any omission, or reconcile any
inconsistency in the Plan in such manner and to such extent as it
shall deem expedient to carry the same into effect, and it shall
be the sole and final judge of when such action shall be
appropriate.
7.04 Finality of Action:
The acts and determinations of the Committee within the powers conferred
by the Plan shall be final and conclusive for all purposes of the Plan
and shall not be subject to appeal or review by persons or entities
other than the Board.
7.05 Liability:
No member of the Committee shall be directly or indirectly responsible
or under any liability by reason of any action or default by him as a
member of the Committee, or the exercise of or failure to exercise any
power or discretion as such member, except for his own fraud or willful
misconduct; and no member of the Committee shall be liable in any way
for the acts or defaults of any other member of the Committee or any of
its advisors, agents or representatives. The Company shall indemnify
and save harmless each member of the Committee against any and all
expenses and liabilities arising out of his own membership on the
Committee, except expenses and liabilities arising out of his own fraud
or willful misconduct.
7.06 Compensation and Expenses:
The members of the Committee may receive such reasonable compensation
for their services as may be authorized from time-to-time by the Board,
and except as otherwise provided above, shall be entitled to receive
their reasonable expenses incurred in administering the Plan. Any such
compensation and expenses, as well as extraordinary expenses authorized
by the Board, shall be paid by the Company.
7.07 Information Furnished to Committee:
The Company shall furnish to the Committee in writing all information
the Company deems appropriate for the Committee to exercise its powers
and duties in administration of the Plan. Such information may include,
but shall not be limited to, the names of all Eligible Employees, their
Annual Base Compensation, and their dates of birth, employment,
termination of employment, retirement or death. Such information shall
be conclusive for all purposes of the Plan and the Committee shall be
entitled to rely thereon without any investigation thereof; provided,
however, that the Committee may correct any errors discovered in any
such information.
7.08 Examination by Participants:
The Committee shall make available to each Participant for examination
by him, at the principal office of the Company or at such other location
as may be reasonably convenient to him, a copy of the Plan and such of
its records or copies thereof as may pertain toe any benefits of such
Participant under the Plan.
ARTICLE VIII
MISCELLANEOUS
8.01 Unfunded Plan:
Any Participant who may have or claim any interest in or right to any
compensation, payment or benefit payable hereunder, shall rely solely
upon the unsecured promise of the Company as set forth herein for the
payment thereof, and nothing herein contained shall be construed to give
to or vest in the Participant or any other person now or at any time in
the future, any right, title, interest or claim in or to any specific
asset, fund, reserve, account or property of any kind whatever owned by
the Company or in which it may have any right, title or interest now or
at any time in the future.
8.02 Additional Benefits:
It is agreed and understood that any benefits accrued under this Plan
are in addition to any and all employee benefits to which a Participant
may otherwise be entitled under any other contract, arrangement or
voluntary pension, profit sharing or other compensation plan of the
Company, and that this Plan shall not affect or impair the rights or
obligations of the Company or a Participant under any other such
contract, arrangement or voluntary plan.
8.03 Modification and Cancellation:
This Plan may be amended, modified, suspended or terminated by the Board
as and when it deems such action necessary; however, no such action
shall have the effect of terminating or voiding a Participant's
contractual right to receive that portion of any award made hereunder
which shall have vested in him as of the time of such Board action.
8.04 Enforceability:
If any term or condition of the Plan shall be invalid or unenforceable
to any extent or in any application, then the remainder of the Plan, and
such term or condition except to such extent or in such application,
shall not be affected thereby, and each and every term and condition of
the Plan shall be valid and enforced to the fullest extent and in the
broadest application permitted by law.
8.05 Notices:
All notices or other communications permitted to be given or called for
pursuant to the Plan shall be in writing and shall be considered as
properly given or made if hand delivered, mailed from within the United
States by certified or registered mail, or sent by prepaid telegram:
(1) If to the Company, in care of its President and Chief Executive
Officer, 4721 Morrison Drive, P.O. Box 162066, Mobile, Alabama
36625.
(2) If to a Participant, in care of him at such address as he shall
have provided in writing to the Committee, or in the absence
thereof, to such other address as shall appear on the books of the
Company.
FIRST AMENDMENT TO THE
MORRISON INCORPORATED
EXECUTIVE SUPPLEMENTAL PENSION PLAN
THIS FIRST AMENDMENT, made as of the 30th day of June , 1994, by
MORRISON RESTAURANTS INC., f/k/a Morrison Incorporated, a corporation duly
organized and existing under the laws of the State of Delaware (the "Primary
Sponsor");
W I T N E S E T H:
WHEREAS, the Primary Sponsor maintains the Morrison Incorporated
Executive Supplemental Pension Plan under a restated indenture effective as
of June 1, 1986 (the "Plan"); and
WHEREAS, the Primary Sponsor now desires to amend the Plan in order to
make certain changes to its eligibility provisions and for other reasons;
NOW, THEREFORE, the Primary Sponsor does hereby amend the Plan,
effective January 1, 1994, as follows:
1. By deleting existing Section 2.01(d) in its entirety and by substituting
therefor the following: "[Reserved]." In addition, the term "Plan
Administrator" shall be substituted in lieu of the term "Committee" each time
the latter term appears in the Plan.
2. By deleting existing Section 2.01(e) in its entirety and by substituting
therefore the following:
"(e) The term `Company' refers to Morrison Restaurants Inc., f/k/a
Morrison Incorporated, a Delaware corporation."
3. By deleting the existing second and final paragraphs of Section 2.01(f)
in their entirety and by substituting therefor the following:
"With respect to Eligible Employees who were Participants in the Plan
prior to January 1, 1994, Continuous Service shall not include any
period of employment subsequent to an Employee's participation in the
Plan from and after the date the Plan Administrator has expressly
terminated an Employee's participation in the Plan, unless and until he
or she thereafter qualifies as an Eligible Employee in accordance with
the provisions of the immediately succeeding sentence. With respect to
Eligible Employees who first become Participants in the Plan after
December 31, 1993, Continuous Service shall not include any period of
employment subsequent to an Employee's participation in the Plan (i)
during which the Employee no longer holds any one of the Qualifying
Positions, (ii) following three (3) consecutive Plan Years during which
the Participant failed to earn an annual salary, plus bonus, of at least
$120,000 (as adjusted in accordance with Plan Section 2.01(h)); or (iii)
from and after the date the Plan Administrator has expressly terminated
an Employee's participation in the Plan. An Eligible Employee who
experiences a break in Continuous Service as described in this paragraph
who again becomes an Eligible Employee or who is reinstated by action
of the Plan Administrator shall have his periods of Continuous Service
aggregated for purposes of calculating his Accrued Benefit, but in no
event shall such aggregated periods of Continuous Service include
periods during which the Employee no longer holds any Qualifying
Position; any period of employment during which the Employee is not an
Eligible Employee following a three-consecutive Plan Year period in
which the Employee failed to earn at least $120,000 (as adjusted in
accordance with Plan Section 2.01(h)); or after the date the Employee's
participation in the Plan has been expressly terminated by the Plan
Administrator unless and until both the Plan Administrator reverses that
decision and the Employee otherwise qualifies as an Eligible Employee."
4. By deleting Section 2.01(h) in its entirety and by substituting therefor
the following:
"(h) The term `Eligible Employee' means, prior to January 1, 1994, an
individual employed on a full-time basis by the Company or one or
more of its subsidiaries who has earned at least 850 HAY points,
has been credited with at least three (3) `Years of Service,' as
defined under the Morrison Incorporated Retirement Plan and has
been selected for participation by the Plan Administrator and,
after December 31, 1993, an individual employed on a full-time
basis by the Company or one or more of its subsidiaries who earned
an average salary, plus bonus, of at least $120,000 (or such
greater amount as may be determined by the Plan Administrator from
time to time) during the last two (2) Plan Years immediately
preceding the first day of the Plan Year in which an Eligible
Employee becomes a Participant and who has completed at least five
(5) full years of consecutive service, on a calendar-year basis
or otherwise, during which the Employee has held one or more
Qualifying Positions."
5. By deleting the second sentence of the first paragraph of Section
2.01(i) and by substituting therefor the following:
"If the Participant retires, terminates employment or ceases to accrue
Continuous Service in accordance with Plan Section 2.01(f), his Annual
Base Salary for the final partial year of participation shall be
annualized for purposes of calculating Final Base Salary."
6. By deleting the second sentence of Section 2.01(k) and by substituting
therefor the following:
"An Eligible Employee shall become a Participant as of the January 1st
immediately following the date the eligibility criteria stated in Plan
Section 2.01(h) are satisfied. Upon retirement, termination of
employment or cessation of the accrual of Continuous Service in
accordance with Plan Section 2.01(f), a Participant's status shall
become that of a former Participant."
7. By substituting the name "Morrison Restaurants Inc. Executive
Supplemental Pension Plan" for the name "Morrison Incorporated
Executive Supplemental Pension Plan" in Section 2.01(l).
8. By adding new Section 2.01(l)(l), immediately after Section 2.01(l), as
follows:
"(l)(l) The term `Plan Administrator' shall mean the organization
or person designated to administer the Plan by the Board of
Directors or, in lieu of any such designation, the
Company."
9. By deleting the first sentence of the third paragraph of Section 2.01(n)
and by substituting therefor the following:
"The date of calculation will be the retirement date, termination date
or date of the cessation of the accrual of Continuous Service in
accordance with Plan Section 2.01(f), whichever is applicable."
10. By adding new Section 2.01(o) as follows:
"(o) "Qualifying Position" means one or more of the positions within
the Company's organizational hierarchy identified in Appendix A hereto,
as the same may be amended from time to time hereafter by the Chief
Executive Officer of the Company.
11. By deleting Article VII in its entirety and by substituting therefor the
following:
"VIII. ADMINISTRATION OF THE PLAN
A. Operation of the Plan Administrator The Company shall be
the Plan Administrator, unless it appoints another Plan Administrator.
If an organization is appointed to serve as the Plan Administrator, then
the Plan Administrator may designate in writing a person who may act on
behalf of the Plan Administrator. The Company shall have the right to
remove the Plan Administrator at any time by notice in writing. The
Plan Administrator may resign at any time by written notice of
resignation to the Company. Upon removal or resignation, or in the
event of the dissolution of the Plan Administrator, the Company shall
appoint a successor.
B. Duties of the Plan Administrator
1. The Plan Administrator shall perform any act which
the Plan authorizes or requires of the Plan Administrator by
action taken in compliance with the Plan and may designate in
writing other persons to carry out its duties under the Plan. The
Plan Administrator may employ persons to render advice with regard
to any of the Plan Administrator's duties.
2. The Plan Administrator shall from time to time
establish rules, not contrary to the provisions of the Plan, for
the administration of the Plan and the transaction of its
business. All elections and designations under the Plan by a
participating Employee or beneficiary shall be made on forms
prescribed by the Plan Administrator. The Plan Administrator
shall have discretionary authority to construe the terms of the
Plan and shall determine all questions arising in the
administration, interpretation and application of the Plan,
including, but not limited to, those concerning eligibility for
benefits and it shall not act so as to discriminate in favor of
any person. All determinations of the Plan Administrator shall
be conclusive and binding on all Employees and beneficiaries,
subject to the provisions of the Plan and subject to applicable
law.
3. The Plan Administrator shall furnish Employees and
Beneficiaries with all disclosures now or hereafter required by
the Employee Retirement Income Security Act of 1974, as amended
("ERISA"). The Plan Administrator shall file, as required, the
various reports and disclosures concerning the Plan and its
operations as required by ERISA and by the Internal Revenue Code,
and shall be solely responsible for establishing and maintaining
all records of the Plan.
4. The statement of specific duties for a Plan
Administrator in this Section are not in derogation of any other
duties which a Plan Administrator has under the provisions of the
Plan or under applicable law.
5. The Company shall indemnify and hold harmless each
person constituting the Plan Administrator from and against any
and all claims and expenses (including, without limitation,
attorney's fees and related costs) arising in connection with the
performance by the person of his or her duties in that capacity,
other than any of the foregoing arising in connection with the
willful neglect or willful misconduct of the person acting.
C. Action by the Company Any action to be taken by the
Company shall be taken by resolution or written direction duly adopted
by the Board or appropriate governing body, as the case may be;
provided, however, that by such resolution or written direction, the
Board or appropriate governing body, as the case may be, may delegate
to any officer or other appropriate person of the Company the authority
to take any such actions as may be specified in such resolution or
written direction, other than the power to amend or terminate the Plan
or to determine the basis of any payment obligations of the Company.
D. CLAIM REVIEW PROCEDURE
1. In the event that an Employee or beneficiary is
denied a claim for benefits under the Plan, the Plan
Administrator shall provide to such claimant written notice
of the denial which shall set forth:
a. the specific reasons for the denial;
b. specific references to the pertinent
provisions of the Plan on which the denial is based;
c. a description of any additional material or
information necessary for the claimant to perfect the claim
and an explanation of why such material or information is
necessary; and
d. an explanation of the Plan's claim review
procedure.
2. After receiving written notice of the denial of a
claim, a claimant or his or her representative may:
a. request a full and fair review of such denial
by written application to the Plan Administrator;
b. review pertinent documents; and
c. submit issues and comments in writing to the
Plan Administrator.
3. If the claimant wishes such a review of the decision
denying his or her claim to benefits under the Plan, he or she
must submit such written applications to the Plan Administrator
within sixty (60) days after receiving written notice of the
denial.
4. Upon receiving such written application for review,
the Plan Administrator may schedule a hearing for purposes of
reviewing the claimant's claim, which hearing shall take place not
more than thirty (30) days from the date on which the Plan
Administrator received such written application for review.
5. At least ten (10) days prior to the scheduled hearing,
the claimant and his or her representative designated in writing
by him or her, if any, shall receive written notice of the date,
time, and place of such scheduled hearing. The claimant or his
or her representative, if any, may request that the hearing be
rescheduled, for his or her convenience, on another reasonable
date or at another reasonable time or place.
6. All claimants requesting a review of the decision
denying their claim for benefits may employ counsel for purposes
of the hearing.
7. No later than sixty (60) days following the receipt
of the written application for review, the Plan Administrator
shall submit its decision on the review in writing to the claimant
involved and to his or her representative, if any; provided,
however, a decision on the written application for review may be
extended, in the event special circumstances such as the need to
hold a hearing require an extension of time, to a day no later
than one hundred twenty (120) days after the date of receipt of
the written application for review. The decision shall include
specific reasons for the decision and specific references to the
pertinent provisions of the Plan on which the decision is based.
Except as specifically provided herein, the Plan shall remain in full
force and effect as prior to this First Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment
to be executed as the day and year first above written.
MORRISON RESTAURANTS INC.
By:/s/ Samuel E. Beall
Title: President & Chief Executive Officer
[CORPORATE SEAL]
ATTEST:
/s/ Pfilip G. Hunt
Title: Senior Vice President,
General Counsel & Secretary
APPENDIX A
EXECUTIVE SUPPLEMENTAL PENSION PLAN
ELIGIBLE POSITIONS
President-Chief Executive Officer
Chairman of the Board
President-RTG
President-FDG
President-Health Care
President-Business & Industry
Senior Vice President Marketing-Corp.
Senior Vice President, Human Resources-Corp.
Senior Vice President, Legal-Corp.
Vice President, Finance-Corp.
Vice President, Controller and Treasurer
Senior Vice President, Operations-FDG
Senior Vice President, Operations-RTG
Vice President-Design Construction-RTG
Vice President, Operations-Silver Spoons
Vice President, Financial Planning
Vice President, Controller-RTG
Vice President, Legal-Real Estate
Vice President-Real Estate
Vice President, Human Resources-FDG
Vice President, Human Resources-Health Care
Vice President, Human Resources-RT
Vice President, Ind. Rel.-MHG
Vice President, Controller-FDG
Senior Vice President, Development-FDG
Vice President, Marketing-FDG
Vice President, Controller-MHG
Regional Vice President-Health Care
Regional Vice President-Business & Industry
Vice President, Real Estate-FDG
Director, Operations-FDG
Vice President-Nutritional Services
Vice President-Vending
Vice President-Sales
Regional Director-RTG
Vice President, Human Resources-Business & Industry
SECOND AMENDMENT TO THE
MORRISON RESTAURANTS INC.
EXECUTIVE SUPPLEMENTAL PENSION PLAN
THIS SECOND AMENDMENT is made as of the 31 day of July , 1995, by
MORRISON RESTAURANTS INC., f/k/a Morrison Incorporated, a corporation duly
organized and existing under the laws of the State of Delaware (the "Primary
Sponsor").
W I T N E S S E T H:
WHEREAS, the Primary Sponsor maintains the Morrison Restaurants Inc.
Executive Supplemental Pension Plan under a restated indenture effective as
of June 1, 1986 (the "Plan") and as last amended by indenture dated June 30,
1994; and
WHEREAS, the Primary Sponsor now desires to amend the Plan in order to
add an enhanced early retirement opportunity for eligible participants;
NOW, THEREFORE, the Primary Sponsor does hereby amend the Plan, effective
as of March 29, 1995, as follows:
1. By deleting existing Section 4.02 in its entirety and by substituting
therefor the following:
4.02 Early Retirement:
(a) Actuarially Reduced Early Retirement Benefit. Before any
Participant is eligible for early retirement pursuant to
Section 4.02(b) below, the Participant may retire from service
with the Company or any of its subsidiaries prior to reaching
his Normal Retirement Date and commence receiving benefits from
this Plan if the Participant has attained at least age 55. The
Accrued Benefit under this Plan, as determined in Section 3.01,
but payable pursuant to this Section 4.02(a), will be reduced
by multiplying the Accrued Benefit amount by the applicable
early retirement factor indicated below and, in determining the
Accrued Benefit, the amount of any offset under Section 3.01(C)
shall be calculated as the retirement benefit payable in the
form of a single life annuity to the Participant under the
Morrison Restaurants Inc. Retirement Plan at the Participant's
Retirement Date (as defined therein):
<TABLE>
<CAPTION>
Number of Years Until Eligible Early Retirement
for Unreduced Early Retirement Benefit Factor
<S> <C>
1 .93
2 .86
3 .79
4 .72
5 .65
</TABLE>
(b) Unreduced Early Retirement Benefit. A Participant may retire
from service with the Company or any of its subsidiaries prior
to reaching his Normal Retirement Date and commence receiving
benefits from this Plan pursuant to this Section 4.02(b) if:
(i) the Participant attains age 60 prior to termination
of employment from the Company or any of its
subsidiaries; or
(ii) at the time of retirement from service with the
Company or any of its subsidiaries, the Participant
is at least age 55 and the sum of that
Participant's age and years of Continuous Service
equals or exceeds ninety (90).
The Accrued Benefit, as determined in Section 3.01, but payable
pursuant to this Section 4.02(b), will not be subject to
actuarial reduction and, in determining the Accrued Benefit,
the amount of any offset under Section 3.01(C) shall be
calculated as the retirement benefit payable in the form of a
single life annuity to the Participant under the Morrison
Restaurants Inc. Retirement Plan at the Participant's
Retirement Date (as defined therein).
A Participant with an accrued benefit under the Morrison Restaurants
Inc. Retirement Plan must commence receiving those benefits at the
same time as the Participant commences receiving benefits under this
Section 4.02.
2. By deleting existing Article VI in its entirety and by substituting
therefore the following:
ARTICLE VI
CONDITIONS AND FORFEITURES
6.01 Forfeiture of Accrued Benefit
If a Participant's Continuous Service is terminated because of his proven
or admitted fraud or dishonesty of a material nature, his willful damage
to property, reputation or goodwill of the Company, or any of its
subsidiaries, his conviction of a felony, his willful and material
insubordination or violation of Company rules, and/or his gross neglect
of duties assigned by the Company; and if such act or action adversely
affects the Company in a substantial respect, then notwithstanding any
other provision of this Plan, the Committee may determine that any
benefits to which such Participant might otherwise have been entitled
under the Plan shall be forfeited. The decision of the Committee with
respect to sufficiency of the proof or admission of such act or action,
the substantially adverse affect thereof, and the forfeiture resulting
therefrom, as long as made with consistency and sound judgment, shall be
final and binding.
6.02 Forfeiture of Early Retirement Benefit
Upon a Participant's early retirement under Section 4.02, the Participant
shall not, without the prior written consent of the Company, for the two-
year period commencing with his retirement (the "Non-Competition
Period"), engage in activities of the same character and scope to those
in which he was engaged (1) on behalf of a division of the Company
(and/or a subsidiary), or (2) on behalf of the Company (and/or a
subsidiary) in a corporate or staff specialized function, immediately
prior to his retirement for a competitor at a location within the United
States.
If a Participant fails to cure any alleged breach of this Section 6.02
within thirty (30) days following receipt of written notice from the
Company, the Company may apply a forfeiture penalty against the
Participant with respect to each future periodic payment due him under
the Plan equal to the difference between the periodic payment otherwise
payable to him pursuant to Section 4.02(a) or (b), as the case may be,
and the amount the Participant would have received as a periodic payment
had the Participant's Accrued Benefit been reduced by the applicable
discount factor set forth below:
<TABLE>
<CAPTION>
Age at Retirement Discount Factor
<S> <C>
64 .93
63 .86
62 .79
61 .72
60 .65
59 .62
58 .59
57 .56
56 .53
55 .50
</TABLE>
Any such forfeiture may be applied against each future periodic payment
due to the Participant under the Plan until the first to occur of (i) the
expiration of Non-Competition Period, or (ii) the date the Company
determines that the Participant is no longer in breach of the provisions
of this Section 6.02.
For purposes of this Section 6.02, as to a Participant, the term
"competitor" means (A), (B), (C) or (D) below, depending upon the
division or position within the Company (or subsidiary) for which the
Participant provided services at the time of his retirement:
(A) if the Participant was then performing services for either the
Ruby Tuesday Division or Specialty Division (or any successors
thereto), any multi-unit, multi-state foodservice business that is
of a character and concept similar to a Ruby Tuesday restaurant,
including, but not limited to, a casual dining restaurant business
with an American themed, generic, broad-based menu similar in
concept to Ruby Tuesday, serving soups, sandwiches, chicken, ethnic
cuisine, health or fitness oriented dishes and a full bar or for any
other multi-unit foodservice business that is of a character and
concept involving casual dining with an ethnic or other themed menu
similar to any restaurant then being operated or otherwise
maintained by the Ruby Tuesday Division or Specialty Division (or
successors thereto);
(B) if the Participant was then performing services for the Heath
Care Division (or any successor thereto), any multi-unit, multi-
state foodservice business that is engaged in providing food and
nutritional services to medical and residential care facilities for
the sick and elderly, including, without limitation, elderly feeding
programs and similar programs;
(C) if the Participant was then performing services for the Family
Dining Division (or any successor thereto), any multi-unit, multi-
state foodservice business that is engaged in operating or otherwise
maintaining family-style dining cafeterias; or
(D) if the Participant was then performing services for the Company
(and/or a subsidiary) (or any successor thereto) in a corporate or
staff specialized function at retirement, any business described in
(A), (B) or (C) above.
Except as specifically provided herein, the Plan shall remain in full
force and effect as prior to this Second Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment
to be executed as of the day and year first above written.
MORRISON RESTAURANTS INC.
By: /s/ Samuel E. Beall
Title: Chairman and CEO
[CORPORATE SEAL]
ATTEST:
/s/ Pfilip G. Hunt
Title: Secretary
MORRISON RESTAURANTS INC.
STOCK INCENTIVE AND
DEFERRED COMPENSATION PLAN
FOR DIRECTORS
TABLE OF CONTENTS
SECTION 1 DEFINITIONS
1.1 Definitions
SECTION 2 THE STOCK INCENTIVE AND DEFERRED COMPENSATION PLAN
2.1 The Purpose of the Plan
2.2 Stock Subject to the Plan
2.3 Administration of the Plan
2.4 Eligibility
SECTION 3 RESTRICTED STOCK AWARDS
3.1 Awards
3.2 Vesting
3.3 Escrow of Shares
3.4 Limitations on Transfer
SECTION 4 DEFERRAL OF COMPENSATION
4.1 Deferral to Deferred Compensation Accounts
4.2 Revocation of Elections
4.3 Revocation of Prior Elections
SECTION 5 DEFERRED COMPENSATION ACCOUNTS
5.1 Establishment of Accounts
5.2 Crediting of Deferrals
5.3 Crediting Income
5.4 Distribution of Accounts
5.5 Distribution upon Death
5.6 Statement of Account
5.7 Participant's Rights Unsecured
SECTION 6 STOCK AWARDS AND GRANT OF OPTIONS
6.1 Elections to Purchase Shares
6.2 Number of Shares Issued
6.3 Option Grants
6.4 Option Term
6.5 Payment
6.6 Non-Transferability
SECTION 7 GENERAL PROVISIONS
7.1 Changes in Capitalization; Merger; Liquidation
7.2 Right to Remove Director
7.3 Restrictions on Delivery and Sale of Shares;
Legends
7.4 Non-alienation of Benefits
7.5 Termination and Amendment of the Plan
7.6 Stockholder Approval
7.7 Choice of Law
7.8 Effective Date of Plan
MORRISON RESTAURANTS INC.
STOCK INCENTIVE AND DEFERRED COMPENSATION PLAN
FOR DIRECTORS
The Morrison Restaurants Inc. Stock Incentive and Deferred
Compensation Plan for Directors contained herein constitutes an
amendment and restatement of the Morrison Incorporated Stock
Incentive and Deferred Compensation Plan for Directors which was
effective on September 30, 1992 (the "Prior Plan"). The Prior
Plan constituted, in part, an amendment and restatement of the
Morrison Incorporated Deferred Compensation Plan for Directors.
SECTION 1 DEFINITIONS
1.1 Definitions. Whenever used herein, the masculine
pronoun shall be deemed to include the feminine, and the singular
to include the plural, unless the context clearly indicates
otherwise, and the following capitalized words and phrases are
used herein with the meaning thereafter ascribed:
(a) "Annual Retainer Compensation" means the retainer
fee payable to a Participant by the Company for the then current
fiscal year of the Company, but shall not include any meeting or
committee fees or expense reimbursements paid to a Participant,
as determined on the first day of the fiscal year or, if later,
as of the first day an individual becomes a Participant.
(b) "Board of Directors" means the board of directors
of the Company.
(c) "Change in Control" means any event that pursuant
to the Company's Certificate of Incorporation, as amended from
time to time, requires the affirmative vote of the holders of not
less than eighty percent (80%) of the Voting Stock (as defined
therein); provided, however, that no event shall constitute a
Change of Control if approved by the Board of Directors a
majority of whom are present directors and new directors. For
purposes of the preceding sentence, the term "present directors"
means individuals who as of the date this Plan is adopted were
members of the Board of Directors and the term "new directors"
means any director whose election by the Board of Directors in
the event of vacancy or whose nomination for election was
approved by a vote of at least three-fourths of the directors
then still in office who are present directors and new directors;
provided that any director initially elected to the Board of
Directors solely to avoid or settle a threatened or actual proxy
contest shall in no event be deemed to be a new director.
(d) "Code" means the Internal Revenue Code of 1986, as
amended.
(e) "Committee" means the committee appointed by the
Board of Directors to administer the Plan or, in the absence of
appointment of such committee, the Board of Directors.
(f) "Company" means Morrison Restaurants Inc., a
Delaware corporation.
(g) "Compensation" means Nonretainer Compensation and
Annual Retainer Compensation.
(h) "Deferred Compensation Account" means an account
established and maintained on behalf of each Participant and
Prior Participant which shall be credited with certain amounts
deferred by Participants under the Plan and with a rate of return
as described in Plan Section 5.3.
(i) "Disability" means that condition described in
Code Section 22(e)(3), as amended from time to time. In the
event of a dispute, the determination of Disability shall be made
by the Board of Directors and shall be supported by advice of a
physician competent in the area to which such Disability relates.
(j) "Disposition" means any conveyance, sale,
transfer, assignment, pledge or hypothecation, whether outright
or as security, inter vivos or testamentary, with or without
consideration, voluntary or involuntary.
(k) "Effective Date" means the date the Plan, as
amended and restated herein, is approved by the stockholders of
the Company.
(l) "Exchange Act" means the Securities Exchange Act
of 1934, as amended.
(m) "Fair Market Value" with regard to a date means
the closing price of the Stock on the last trading date prior to
that date as reported by the New York Stock Exchange (or, if
applicable, as reported by any other national securities exchange
selected by the Committee on which the shares of Stock are then
actively traded).
(n) "Nonretainer Compensation" means the meeting and
committee fees paid to a Participant by the Company, but does not
include any Retainer Compensation or expense reimbursement paid
to a Participant.
(o) "Old Plan" means the Morrison Incorporated
Deferred Compensation Plan for Directors as it existed prior to
its initial amendment and restatement as the Morrison
Incorporated Stock Incentive and Deferred Compensation Plan for
Directors.
(p) "Option" means an option granted under the Plan to
buy shares of Stock as set forth in Plan Section 6.
(q) "Participant" means an individual who, pursuant to
Plan Section 2.4, is eligible to participate in the Plan.
(r) "Plan" means the Morrison Restaurants Inc. Stock
Incentive and Deferred Compensation Plan for Directors (formerly
known as the Morrison Incorporated Stock Incentive and Deferred
Compensation Plan for Directors) as amended and restated herein.
(s) "Prior Participant" means a former Participant
whose benefits have not been fully distributed from the Plan.
(t) "Restricted Stock Award" means a restricted stock
award under Plan Section 3.1.
(u) "Retainer Compensation" means the quarterly
retainer fee paid to a Participant by the Company, but shall not
include any meeting or committee fees or expense reimbursements
paid to a Participant.
(v) "Stock" means the Company's common stock, $.01 par
value.
(w) "Stock Awards" means the shares of Stock issued
pursuant to Section 6.2.
(x) "Stock Incentive Agreement" means an agreement
between the Company and a Participant or other documentation
evidencing an award of a Stock Incentive.
(y) "Stock Incentives" means Options, Stock Awards and
Restricted Stock Awards.
(z) "Target Ownership Level" means the number of
shares of Stock owned by the Participant with a Fair Market Value
equal to ten (10) multiplied by the Annual Retainer Compensation
payable to that Participant. The Target Ownership Level shall be
determined as of the first day of any fiscal quarter or, if
later, as of the first day an individual becomes a Participant.
The vested shares under restricted stock awards issued pursuant
to the Plan and the shares of Stock owned by a Participant's
spouse and children under age 21 will be included in determining
whether a Participant has attained the Target Ownership Level.
SECTION 2 THE STOCK INCENTIVE AND DEFERRED COMPENSATION PLAN
2.1 The Purpose of the Plan. The Plan is intended to (a)
provide incentive to non-employee directors of the Company to
stimulate their efforts toward the continued success of the
Company and to manage the business of the Company in a manner
that will provide for the long-term growth and profitability of
the Company; (b) encourage stock ownership by non-employee
directors by providing them with a means to acquire a proprietary
interest in the Company; and (c) provide a means of obtaining and
rewarding non-employee directors.
2.2 Stock Subject to the Plan. Subject to adjustment in
accordance with Section 7.1, 225,000 shares of Stock (the
"Maximum Plan Shares") are hereby reserved exclusively for
issuance pursuant to Stock Incentives. At no time shall the
aggregate of (a) shares of Stock issuable pursuant to outstanding
Options; (b) shares of Stock issued pursuant to Options; (c)
shares of Stock issued as Restricted Stock Awards; and (d) shares
of Stock issued pursuant to Stock Awards exceed the Maximum Plan
Shares. If an Option expires or terminates for any reason
without being exercised in full, the unpurchased shares subject
to such Option shall again be available for purposes of the Plan.
2.3 Administration of the Plan. The Plan shall be
administered by the Committee. Subject to the provisions of the
Plan, the Committee shall have full and conclusive authority to
interpret the Plan; to prescribe, amend and rescind rules and
regulations relating to the Plan; to determine the terms and
provisions of the respective Stock Incentive Agreements
consistent with the provisions of the Plan and to make all other
determinations necessary or advisable for the proper
administration of the Plan. The Committee's decisions shall be
final and binding on all Participants. The Plan shall be
interpreted in view of the intention that the grant of Stock
Awards, the grant of Restricted Stock Awards and the grant and
exercise of Options are intended to qualify as exempt
transactions under Rule 16b-3 under the Exchange Act.
2.4 Eligibility. Any member of the Board of Directors who
is not an employee of the Company shall be a Participant.
SECTION 3 RESTRICTED STOCK AWARDS
3.1 Awards. Subject to Plan Section 7.6, each Participant
who first is elected to the Board of Directors on or after
September 29, 1993 shall receive a Restricted Stock Award for
5,000 shares of Stock as of the date the individual is first
elected to the Board of Directors or, if later, as of the
Effective Date. Each Restricted Stock Award shall be evidenced
by a Stock Incentive Agreement which shall incorporate the
applicable terms of the Plan.
3.2 Vesting. One-third of the shares of Stock subject to
a Restricted Stock Award shall vest on each of the first three
(3) anniversary dates of the date the Participant was first
elected to the Board of Directors, provided the Participant
remains a member of the Board of Directors as of the applicable
anniversary date. In the event a Participant ceases to be a
member of the Board of Directors prior to the third anniversary
of the Participant's election to the Board of Directors, any
unvested shares shall be forfeited. Notwithstanding the
preceding, all shares of Stock subject to the Restricted Stock
Award shall become vested on the date the Participant ceases to
be a member of the Board of Directors on account of death,
Disability, upon attaining age 70 or upon a Change in Control.
3.3 Escrow of Shares. Any certificates representing the
shares of Stock awarded pursuant to a Restricted Stock Award
shall be issued in the Participant's name, but shall be held by
a custodian designated by the Committee (the "Custodian") until
such time as such shares of Stock become vested or are forfeited.
Each Stock Incentive Agreement governing a Restricted Stock Award
shall appoint the Custodian as the attorney-in-fact for the
Participant until such time as shares of Stock become vested or
are forfeited in accordance with Plan Section 3.2 with full power
and authority in the Participant's name, place and stead to
transfer, assign and convey to the Company any shares of Stock
held by the Custodian for such Participant if the Participant
forfeits such shares. In the event the shares of Stock subject
to the Restricted Stock Award become vested, the Custodian shall
deliver the certificate for such shares to the Participant. In
the event the Participant forfeits any or all of the shares of
Stock subject to the Restricted Stock Award, the Custodian shall
deliver the certificate for such shares to the Company. During
the period that the Custodian holds the shares subject to this
Section, the Participant shall be entitled to all rights, except
as provided in the Stock Incentive Agreement, applicable to
shares of Stock not so held.
3.4 Limitations on Transfer. The Participant shall not
have the right to make or permit to exist any Disposition of the
shares of Stock held by the Custodian until the applicable
vesting date determined pursuant to Plan Section 3.2 and any
Disposition attempted prior to that date shall be void. The
Company shall not recognize and shall not have the duty to
recognize any Disposition not made in accordance with the Plan.
SECTION 4 DEFERRAL OF COMPENSATION
4.1 Deferral to Deferred Compensation Accounts. Each
Participant may elect to defer his or her Nonretainer
Compensation, the portion of his Retainer Compensation that is
not used to purchase Stock pursuant to Plan Section 6 or both,
each in twenty-five percent (25%) increments, to his or her
Deferred Compensation Account. An election to defer Compensation
hereunder shall be in writing and shall be made effective only
with respect to Compensation earned on or after the commencement
of the first fiscal quarter of the Company following the receipt
of a Participant's election by the Committee.
4.2 Revocation of Elections. A Participant may revoke or
modify an election made pursuant to Plan Section 4.1 as of a date
no earlier than the first day of the first fiscal quarter that
commences following receipt of the revocation by the Committee
and subject to such other rules as may be established by the
Committee.
4.3 Revocation of Prior Elections. Participants' deferral
elections under the Old Plan or under the Prior Plan, as
applicable, shall continue to be effective until a Participant
makes his or her election under Plan Section 4.1 and shall be
deemed to be revoked by any such election.
SECTION 5 DEFERRED COMPENSATION ACCOUNTS
5.1 Establishment of Accounts. A Deferred Compensation
Account shall be established for each Participant and each Prior
Participant.
5.2 Crediting of Deferrals. A Participant's Deferred
Compensation Account shall be credited with that portion of the
Participant's Compensation that the Participant has elected to
defer to his or her Deferred Compensation Account pursuant to
Plan Section 4.1 as of the date such Compensation would otherwise
have been paid to the Participant.
5.3 Crediting Income. Each Deferred Compensation Account
shall be credited as of the last day of each fiscal quarter of
the Company with an assumed rate of income equal to the then
prevailing rate payable with respect to ninety (90) day U.S.
Treasury Bills, based on the weighted average balance of such
account during such fiscal quarter.
5.4 Distribution of Accounts. Amounts credited to a
Participant's or Prior Participant's Deferred Compensation
Account shall be distributed in either a single lump sum or
annual installments (not to exceed five (5)), as designated by
the Participant or the Prior Participant in his or her initial
election under the Plan, Prior Plan or Old Plan, as applicable.
Distribution of a Deferred Compensation Account shall be made (in
the case of a lump sum payment) or commence (in the case of
installment payments) upon the January 15 or July 15 following
the Participant's or Prior Participant's seventieth (70th)
birthday, or, if earlier, the January 15 or July 15 following the
date the Participant ceases to be a member of the Board of
Directors. However, if the Participant or Prior Participant so
elects in his or her initial election under the Plan, Prior Plan
or Old Plan, as applicable, the distribution (in the case of a
lump sum payment) or the commencement of the distribution (in the
case of installment payments) of the Participant's or Prior
Participant's Deferred Compensation Account shall occur on any
subsequent January 15 or July 15. If a Participant elects to
have his or her Deferred Compensation Account distributed in
installments, the amount of the first installment shall be a
fraction of the value of the Participant's Deferred Compensation
Account, the numerator of which is one and the denominator of
which is the total number of installments elected, and the amount
of each subsequent installment shall be a fraction of the value
(including income credited pursuant to Plan Section 5.3) on the
date preceding each subsequent payment, the numerator of which is
one and the denominator of which is the total number of
installments elected minus the number of installments previously
paid.
5.4 Distribution upon Death. In the event of the death of
a Participant or Prior Participant prior to the distribution of
his or her Deferred Compensation Account in full, the value of
such Deferred Compensation Account shall be determined as of the
day immediately following the Participant's or Prior
Participant's death and such amount shall be distributed in a
single lump sum payment to the Participant's or Prior
Participant's designated beneficiary as soon as administratively
feasible thereafter.
5.5 Statement of Account. During March and September of
each year after the Effective Date, each Participant and Prior
Participant shall be provided with statements of his or her
Deferred Compensation Account as of the end of the third and
first fiscal quarters of the Company, respectively.
5.6 Participant's Rights Unsecured. The right of any
Participant or Prior Participant to receive future distributions
under the provisions of Plan Section 5 shall constitute an
unsecured claim against the general assets of the Company.
SECTION 6 STOCK AWARDS AND GRANT OF OPTIONS
6.1 Elections to Purchase Shares.
(a) Each Participant that has not attained his Target
Ownership Level will be deemed to have elected to direct
that sixty percent (60%) of his or her Retainer Compensation
payable for each fiscal quarter of the Company following the
Effective Date be allocated to the purchase of shares of
Stock on his or her behalf pursuant to this Section 6. Once
a Participant has been deemed to have elected to purchase
Stock pursuant to this subsection (a), such deemed election
will continue in effect until that Participant modifies or
revokes this deemed election, in accordance with the
provisions of Section 6.1(b), after attaining the Target
Ownership Level.
(b) Each Participant who has attained his Target
Ownership Level as of the first day of a fiscal quarter may
make a discretionary election directing that up to sixty
percent (60%) of his or her Retainer Compensation, in ten
percent (10%) increments, be allocated to the purchase of
Stock on his or her behalf. Such a discretionary election
will be effective on the first day of the fiscal quarter of
the Company that is at least six (6) months after the date
it is filed with the Committee in the manner required by the
Committee. Discretionary elections are irrevocable, as
required by Rule 16b-3 under the Exchange Act as in effect
prior to the effective date of Rule 16b-3 as adopted in
1991. As of the date the new Rule 16b-3 which was adopted
in 1991 applies to the Company, discretionary elections may
be revoked or modified effective on the first day of the
fiscal quarter of the Company that begins at least six (6)
months following the date the modified election is filed
with the Committee in the manner required by the Committee.
Notwithstanding the preceding, a discretionary election or
a modification or revocation of a discretionary election may
be given effect on an earlier date, if the Committee, in its
sole discretion, permits, provided the Committee is
satisfied such election, modification or revocation would
not trigger the recovery of short-swing profits under
Section 16 of the Exchange Act.
(c) In the event a Participant ceases to be a member
of the Board of Directors prior to earning that portion of
his or her Retainer Compensation with respect to which the
Participant has elected to purchase Stock under the Plan,
the direction to purchase Stock shall terminate. For
purposes of this Section, a Participant shall be deemed to
have earned the Retainer Compensation payable for a fiscal
quarter of the Company if he or she serves as a member of
the Board of Directors of the Company for at least one day
of that fiscal quarter.
(d) Participants' elections under the Prior Plan,
other than an election made under Section 4.1 of the Prior
Plan, shall be rendered null and void as of the Effective
Date, provided stockholder approval of the Plan is obtained.
6.2 Number of Shares Issued. As of the first day of each
fiscal quarter for which a Participant has elected or is deemed
to have elected to direct that Retainer Compensation be used for
the purchase of Stock pursuant to Plan Section 6.1, the
Participant shall be issued a number of shares of Stock equal to
the amount, if any, of the Participant's Retainer Compensation
allocated to the purchase of Stock, multiplied by 1.15 and
divided by the Fair Market Value of a share of Stock as of the
issue date. Any Stock issued to a Participant pursuant to this
Section 6.2 may not be transferred within three (3) years of the
date of purchase, except in the event of death, Disability,
retirement on or after age 70 or unless the Committee waives this
restriction.
6.3 Option Grants. As of the first day of each fiscal
quarter for which a Participant has been issued Stock pursuant to
Plan Section 6.2, the Participant shall be granted an Option to
purchase a number of shares of Stock equal to three (3) times the
number of shares of Stock issued pursuant to Plan Section 6.2 for
such fiscal quarter (the "Option Shares"). The Option Shares
shall be exercisable at Fair Market Value as of the date of the
option grant. Each Option granted pursuant to the Plan shall be
evidenced by a Stock Incentive Agreement.
6.4 Option Term. Each Option granted hereunder shall be
exercisable six (6) months from the date of grant with respect to
all or any number of the Option Shares. Once exercisable, each
Option granted hereunder shall thereafter remain exercisable
until the fifth (5th) anniversary of the date of grant; provided,
however, that in the event of a Participant's death prior to the
expiration of the Option term, the Option may continue to be
exercised by the Participant's legal representative until the
first anniversary of the Participant's death. An Option that is
not exercised prior to the first anniversary of the Participant's
death shall be deemed exercised on the first anniversary of the
date of death to the extent the then Fair Market Value of the
Option Shares exceeds the exercise price of the Option Shares.
Payment of such exercise price shall be effected by withholding
a number of shares of Stock otherwise issuable pursuant to the
Option the Fair Market Value of which on such anniversary is
equal to the exercise price. If the Fair Market Value of the
Stock on the first anniversary of the Participant's death equals
or is less than the Option exercise price, then the Option shall
be deemed to have expired unexercised.
6.5 Payment. Payment for all shares of Stock purchased
pursuant to exercise of an Option shall be made (a) in cash; (b)
by delivery to the Company of a number of shares of Stock which
have been owned by the holder for at least six (6) months prior
to the date of exercise having an aggregate Fair Market Value of
not less than the product of the exercise price multiplied by the
number of Option Shares the Participant intends to purchase; or
(c) in a cashless exercise through a broker. Payment shall be
made at the time that the Option or any part thereof is
exercised, and no shares shall be issued or delivered upon
exercise of an Option until full payment has been made by the
Participant. The holder of an Option, as such, shall have none
of the rights of a stockholder.
6.6 Non-Transferability. An Option shall not be
transferable or assignable except by will or by the laws of
descent and distribution and shall be exercisable, during the
Participant's lifetime, only by the Participant, or in the event
of the Disability of the Participant, by the legal representative
of the Participant.
SECTION 7 GENERAL PROVISIONS
7.1 Changes in Capitalization; Merger; Liquidation.
(a) The number of shares of Stock reserved with
respect to Stock Incentives and the number of shares of Stock
reserved for issuance upon the exercise of each outstanding
Option and upon vesting of each outstanding Restricted Stock
Award and the exercise price of each outstanding Option shall be
proportionately adjusted for any increase or decrease in the
number of issued shares of Stock resulting from a subdivision or
combination of shares or the payment of a stock dividend in
shares of Stock to holders of outstanding shares of Stock or any
other increase or decrease in the number of shares of Stock
outstanding effected without receipt of consideration by the
Company.
(b) If the Company shall be the surviving corporation
in any merger or consolidation, recapitalization,
reclassification of shares or similar reorganization, an
appropriate adjustment shall be made in each Stock Incentive
Agreement such that the Participant shall be entitled to purchase
or receive the number and class of securities to which a holder
of the number of shares of Stock subject to the Stock Incentive
Agreement at the time of such transaction would have been
entitled to receive as a result of such transaction, and a
corresponding adjustment shall be made in the exercise price of
each outstanding Option. A dissolution or liquidation of the
Company shall cause Options to terminate as to any portion
thereof not exercised as of the effective date of the dissolution
or liquidation. In the event of a sale of substantially all the
Stock or property of the company or the merger or consolidation
of the Company into another corporation where the purchaser does
not agree to the assumption of the Options, the Committee shall
be authorized to terminate the Option in consideration of the
payment to the optionee of the difference between the then Fair
Market Value of the Stock subject to the unexercised portion of
the Option and the aggregate exercise price.
(c) The existence of the Plan and the Stock Incentives
granted pursuant to the Plan shall not affect in any way the
right or power of the Company to make or authorize any
adjustment, reclassification, reorganization or other change in
its capital or business structure, any merger or consolidation of
the Company, any issue of debt or equity securities having
preferences or priorities as to the Stock or the rights thereof,
the dissolution or liquidation of the Company, any sale or
transfer of all or any part of its business or assets, or any
other corporate act or proceeding.
7.2 Right to Remove Director. Nothing in the Plan or in
any Stock Incentive Agreement shall confer upon any Participant
the right to continue as a member of the Board of Directors or
affect the right of the Company to terminate a Participant's
directorship at any time.
7.3 Restrictions on Delivery and Sale of Shares; Legends.
Each Stock Incentive is subject to the condition that if at any
time the Committee, in its discretion, shall determine that the
listing, registration or qualification of the shares covered by
such Stock Incentive upon any securities exchange or under any
state or federal law is necessary or desirable as a condition of
or in connection with the granting of such Stock Incentive or the
purchase or delivery of shares thereunder, the delivery of any or
all shares pursuant to such Stock Incentive may be withheld
unless and until such listing, registration or qualification
shall have been effected. If a registration statement is not in
effect under the Securities Act of 1933 or any applicable state
securities laws with respect to the shares of Stock purchasable
or otherwise deliverable under Stock Incentives then outstanding,
the Participant shall, as a condition of exercise of any Option
or as a condition to any other delivery of Stock pursuant to a
Stock Incentive, represent, in writing, that the shares received
pursuant to the Stock Incentive are being acquired for investment
and not with a view to distribution and agree that the shares
will not be disposed of except pursuant to an effective
registration statement, unless the Company shall have received an
opinion of counsel that such disposition is exempt from such
requirement under the Securities Act of 1933 and any applicable
state securities laws. The Company may include on certificates
representing shares delivered pursuant to a Stock Incentive such
legends referring to the foregoing representations or
restrictions or any other applicable restrictions on resale as
the Company, in its discretion, shall deem appropriate.
7.4 Non-alienation of Benefits. Other than as specifically
provided with regard to the death of a Participant, no benefit
under the Plan shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance or
charge; and any attempt to do so shall be void. No such benefit
shall, prior to receipt by the Participant, be in any manner
liable for or subject to the debts, contracts, liabilities,
engagements or torts of the Participant.
7.5 Termination and Amendment of the Plan. The Board of
Directors at any time may amend or terminate the Plan without
stockholder approval; provided, however, that the Board of
Directors may condition any amendment on the approval of
stockholders of the Company if such approval is necessary or
advisable with respect to tax, securities or other applicable
laws. Notwithstanding the foregoing, in no event shall the Board
of Directors amend the provisions of the Plan that relate to
Stock Awards contemplated pursuant to Plan Section 6.1(a) or to
Restricted Stock Awards more than once every six (6) months,
other than to comport with changes in the Code, the Employee
Retirement Income Security Act of 1974, or the rules thereunder.
No termination, modification or amendment of the Plan, without
the consent of a Participant who has been awarded a Stock
Incentive or with respect to whom amounts have been credited to
a Deferred Compensation Account, shall adversely affect the
rights of that Participant under such Stock Incentive or with
respect to such Deferred Compensation Account.
7.6 Stockholder Approval. The Plan shall be submitted to
the stockholders of the Company for their approval within twelve
(12) months after the adoption of the Plan by the Board of
Directors of the Company. If such approval is not obtained, this
amendment and restatement shall be deemed null and void and the
Prior Plan shall remain as in effect immediately prior to this
amendment and restatement.
7.7 Choice of Law. The laws of the State of Alabama shall
govern the Plan, to the extent not preempted by federal law.
7.8 Effective Date of Plan. The Plan shall become
effective on the Effective Date.
MORRISON RESTAURANTS INC.
By: /s/ Samuel E. Beall
Title: President and Chief
Executive Officer
ATTEST:
/s/ Pfilip G. Hunt
Secretary
[CORPORATE SEAL]
FIRST AMENDMENT TO THE
MORRISON RESTAURANTS INC. STOCK INCENTIVE
AND DEFERRED COMPENSATION PLAN FOR DIRECTORS
THIS FIRST AMENDMENT is made this 29th day of June, 1995,
by Morrison Restaurants Inc., a corporation duly organized and
existing under the laws of the State of Delaware (hereinafter
called the "Company").
W I T N E S S E T H:
WHEREAS, the Company maintains the Morrison Restaurants Inc.
Stock Incentive and Deferred Compensation Plan for Directors,
which is currently maintained under an amended and restated
indenture which became effective as of September 28, 1994 (the
"Plan"); and
WHEREAS, the Company desires to amend the Plan to clarify
the shares of Company common stock which a participating director
may be considered as owning for purposes of determining whether
that director has attained his or her targeted level of ownership
of Company common stock; and
WHEREAS, the Board of Directors of the Company has duly
approved and authorized this amendment to the Plan;
NOW, THEREFORE, the Company does hereby amend the Plan,
effective immediately, by deleting existing Section 1.1(z) in its
entirety and by substituting therefor the following:
"(z) `Target Ownership Level' means the number of
shares of Stock owned by the Participant with a Fair
Market Value equal to ten (10) multiplied by the Annual
Retainer Compensation payable to that Participant. The
Target Ownership Level shall be determined as of the
first day of any fiscal quarter or, if later, as of the
first day an individual becomes a Participant. For
purposes of this Section 1.1(z), a Participant shall be
considered to `own' shares of Stock (i) if the
Participant has any legal or beneficial interest in the
shares of Stock; or (ii) if a legal or beneficial
interest in the shares of Stock is held by the
Participant's spouse or any child under age 21."
Except as specifically amended hereby, the Plan shall remain
in full force and effect as prior to the adoption of this First
Amendment.
IN WITNESS WHEREOF, the Company has caused this First
Amendment to be executed on the day and year first above written.
MORRISON RESTAURANTS INC.
By: /s/ Samuel E. Beall
Title: Chairman of the Board
and Chief Executive Officer
ATTEST:
By: /s/ Pfilip G Hunt
Title: Secretary
[CORPORATE SEAL]
MORRISON RESTAURANTS INC.
NON-QUALIFIED STOCK OPTION AWARD
THIS AWARD is made by MORRISON RESTAURANTS INC. (the
"Company") to ___________________________ , (the "Optionee").
Upon and subject to the Terms and Conditions attached hereto
and incorporated herein by reference, the Company hereby awards
as of the Grant Date to Optionee a non-qualified stock option
(the "Option"), as described below, to purchase the Option
Shares.
A. Grant Date: ________________.
B. Type of Option: Non-Qualified Stock Option.
C. Plan (under which Option is granted): Morrison
Restaurants Inc. Stock Incentive and Deferred
Compensation Plan for Directors.
D. Option Shares: All or any part of _____ shares of the
Company's common stock (the "Common Stock"). The
number of Option Shares granted shall equal three times
the number of shares issued to the Optionee as of the
Grant Date pursuant to Plan Section 6.2.
E. Exercise Price: $______ per share which is the Fair
Market Value, as defined in the Plan, of a share of
Common Stock determined as of the Grant Date.
F. Option Period: The Option may be exercised during the
Option Period which commences six (6) months following
the Grant Date and ends on the fifth (5th) anniversary
of the Grant Date. However, if Optionee dies prior to
the expiration of this period, the Option may be
exercised until one (1) year following Optionee's
death. Note that other restrictions to exercising the
Option, as described in the attached Terms and
Conditions, may apply.
IN WITNESS WHEREOF, the Company has executed and sealed this
Award as of the Grant Date set forth above.
MORRISON RESTAURANTS INC.
By:
Title:
TERMS AND CONDITIONS TO THE
NON-QUALIFIED STOCK OPTION AWARD
UNDER THE MORRISON RESTAURANTS INC.
STOCK INCENTIVE AND DEFERRED COMPENSATION
PLANS FOR DIRECTORS
1. Exercise of Option. Subject to the provisions provided
herein or in the Award made pursuant to the Morrison Restaurants
Inc. Stock Incentive and Deferred Compensation Plan for
Directors:
(a) the Option may be exercised with respect to all or
any portion of the Option Shares at any time during the
Option Period by the delivery to the Company, at its
principal place of business, of (i) a written notice of
exercise in substantially the form attached hereto as Exhibit
1, which shall be actually delivered to the Company no
earlier than thirty (30) days and no later than ten (10) days
prior to the date upon which Optionee desires to exercise all
or any portion of the Option and (ii) payment to the Company
of the Exercise Price multiplied by the number of shares
being purchased (the "Purchase Price") in the manner provided
in Subsection (b). Upon acceptance of such notice and
receipt of payment in full of the Purchase Price, the
Company shall cause to be issued a certificate representing
the Option Shares purchased.
(b) The Purchase Price shall be paid in full upon the
exercise of an Option and no Option Shares shall be issued or
delivered until full payment therefor has been made. Payment
of the Purchase Price for all Option Shares purchased
pursuant to the exercise of an Option shall be made in cash
or, alternatively, as follows:
(i) by delivery to the Company of a number of
shares of Common Stock which have been owned by the
Optionee for at least six months prior to the date of
the Option's exercise, having a Fair Market Value, as
determined under the Plan, on the date of exercise
either equal to the Purchase Price or in combination
with cash to equal the Purchase Price; or
(ii) by receipt of the Purchase Price in cash
from a broker, dealer or other "creditor" as defined by
Regulation T issued by the Board of Governors of the
Federal Reserve System following delivery by the
Optionee to the Committee (defined in the Plan) of
instructions in a form acceptable to the Committee
regarding delivery to such broker, dealer or other
creditor of that number of Option Shares with respect to
which the Option is exercised.
(c) An Option that is not exercised prior to the first
anniversary of the Optionee's death shall be deemed exercised
in full on the first anniversary of the date of death to the
extent the then Fair Market Value of a share of Common Stock
exceeds the Exercise Price, and payment of the Purchase Price
shall be effected by withholding a number of Option Shares
otherwise issuable, the Fair Market Value which on such
anniversary is equal to the Purchase Price. If the Fair
Market Value of a share of Common Stock on the first
anniversary of the Optionee's death equals or is less than
the Exercise Price, then the Option shall be deemed to have
expired unexercised.
2. Exercise Price. The exercise price for each Option
Share shall be the Fair Market Value (defined in the Plan) of a
share of Common Stock as of the Grant Date, subject to adjustment
as set forth in Section 6 below (the "Exercise Price").
3. Termination of Option. Upon the expiration of the
Option Period, this Option and all unexercised rights granted to
Optionee hereunder shall terminate, and thereafter be null and
void.
4. Rights as Shareholder. Until the stock certificates
reflecting the Option Shares to be granted to the Optionee upon
exercise of the Option are issued to the Optionee, the Optionee
shall have no rights as a shareholder with respect to such Option
Shares. The Company shall make no adjustment for any dividends
or distributions or other rights on or with respect to Option
Shares for which the record date is prior to the issuance of that
stock certificate, except as the Plan, the Award or these Terms
and Conditions otherwise provide.
5. Restriction on Transfer of Option. The Option evidenced
hereby is nontransferable other than by will or the laws of
descent and distribution, and, shall be exercisable during the
lifetime of the Optionee only by the Optionee (or in the event of
his Disability (as defined in the Plan), by his personal
representative) and after his death, only by his personal
representative.
6. Changes in Capitalization; Merger; Liquidation.
(a) The number of Option Shares and the Exercise Price
shall be proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock
resulting from a subdivision or combination of shares or the
payment of a stock dividend in shares of Common Stock to
holders of outstanding shares of Common Stock or any other
increase or decrease in the number of shares of Common Stock
outstanding effected without receipt of consideration by the
Company.
(b) If the Company shall be the surviving corporation
in any merger or consolidation, recapitalization,
reclassification of shares or similar reorganization, the
Optionee shall be entitled to purchase or receive the number
and class of securities to which a holder of the number of
shares of Common Stock subject to the Option at the time of
such transaction would have been entitled to receive as a
result of such transaction, and a corresponding adjustment
shall be made in the Exercise Price. A dissolution or
liquidation of the Company shall cause the Option to
terminate as to any portion thereof not exercised as of the
effective date of the dissolution or liquidation. In the
event of a sale of substantially all of the Common Stock or
property of the Company or the merger or consolidation of the
Company into another corporation where the purchaser does not
agree to the assumption of the Option, the Committee shall be
authorized to terminate the Option in consideration of the
payment of the Optionee of the difference between the then
Fair Market Value of the Common Stock subject to the
unexercised portion of the Option and the aggregate Exercise
Price.
(c) The existence of the Plan and the Award shall not
affect in any way the right or power of the Company to make
or authorize any adjustment, reclassification, reorganization
or other change in its capital or business structure, any
merger or consolidation of the Company, any issue of debt or
equity securities having preferences or priorities as to the
Common Stock or the rights thereof, the dissolution or
liquidation of the Company, any sale or transfer of all or
any part of its business or assets, or any other corporate
act or proceeding.
7. Special Limitation on Exercise. Any exercise of the
Option is subject to the condition that if at any time the
Committee, in its discretion, shall determine that the listing,
registration or qualification of the shares covered by the Option
upon any securities exchange or under any state or federal law is
necessary or desirable as a condition of or in connection with
the delivery of shares thereunder, the delivery of any or all
shares pursuant to the Option may be withheld unless and until
such listing, registration or qualification shall have been
effected. The Optionee shall deliver to the Company, prior to
the exercise of the Option, such information, representations and
warranties as the Company may reasonably request in order for the
Company to be able to satisfy itself that the Option Shares are
being acquired in accordance with the terms of an applicable
exemption from the securities registration requirements of
applicable federal and state securities laws.
8. Legend on Stock Certificates. Certificates evidencing
the Option Shares, to the extent appropriate at the time, shall
have noted conspicuously on the certificates a legend intended to
give all persons full notice of the existence of the conditions,
restrictions, rights and obligations set forth in the Award,
these Terms and Conditions and the Plan.
9. Governing Laws. This Award shall be construed,
administered and enforced according to the laws of the State of
Alabama; provided, however, no Option may be exercised except, in
the reasonable judgment of the Board of Directors, in compliance
with exemptions under applicable state securities laws of the
state in which the Optionee resides, and/or any other applicable
securities laws.
10. Successors. The Award and these Terms and Conditions
shall be binding upon and inure to the benefit of the heirs,
legal representatives, successors and permitted assigns of the
parties.
11. Notice. Except as otherwise specified herein, all
notices and other communications under the Award shall be in
writing and shall be deemed to have been given if personally
delivered or if sent by registered or certified United States
mail, return receipt requested, postage prepaid, addressed to the
proposed recipient at the last known address of the recipient.
Any party may designate any other address to which notices shall
be sent by giving notice of the address to the other parties in
the same manner as provided herein.
12. Severability. In the event that any one or more of the
provisions or portion thereof contained in the Award and these
Terms and Conditions shall for any reason be held to be invalid,
illegal or unenforceable in any respect, the same shall not
invalidate or otherwise affect any other provisions of the Award
and these Terms and Conditions, and the Award and these Terms and
Conditions shall be construed as if the invalid, illegal or
unenforceable provision or portion thereof had never been
contained herein.
13. Entire Agreement. Subject to the terms and conditions
of the Plan, the Award and these Terms and Conditions express the
entire understanding and agreement of the parties.
14. Violation. Any transfer, pledge, sale, assignment, or
hypothecation of the Option or any portion thereof shall be a
violation of the terms of the Award and these Terms and
Conditions and shall be void and without effect.
15. Headings. Paragraph headings used herein are for
convenience of reference only and shall not be considered in
construing the Award or these Terms and Conditions.
16. Specific Performance. In the event of any actual or
threatened default in, or breach of, any of the terms, conditions
and provisions of the Award and these Terms and Conditions, the
party or parties who are thereby aggrieved shall have the right
to specific performance and injunction in addition to any and all
other rights and remedies at law or in equity, and all such
rights and remedies shall be cumulative.
17. Right to Remove Director. Neither the establishment of
the Plan nor the award of Option Shares hereunder shall be
construed as giving the Optionee the right to continued
directorship.
EXHIBIT 1
NOTICE OF EXERCISE OF
STOCK OPTION TO PURCHASE
COMMON STOCK OF
MORRISON RESTAURANTS INC.
Name
Address
Date
Morrison Restaurants Inc.
4721 Morrison Drive
P. O. Box 160266
Mobile, AL 36625-0001
Re: Exercise of the Non-Qualified Stock Option
Gentlemen:
Subject to acceptance hereof in writing by Morrison
Restaurants Inc. (the "Company") pursuant to the provisions of
the Morrison Restaurants Inc. Stock Incentive and Deferred
Compensation Plan for Directors (the "Plan"), I hereby give at
least ten days but not more than thirty days prior notice of my
election to exercise options granted to me to purchase
______________ shares of Common Stock of the Company under the
Non-Qualified Stock Option Award (the "Award") pursuant to the
Plan dated as of ____________. The purchase shall take place as
of __________, 199__ (the "Exercise Date").
On or before the Exercise Date, I will pay the applicable
purchase price as follows:
[ ] by delivery of cash or a certified check for
$___________ for the full purchase price payable to the
order of Morrison Restaurants Inc.
[ ] by delivery of a certified check for $___________
representing a portion of the purchase price with the
balance to consist of shares of Common Stock that I have
owned for at least six months and that are represented
by a stock certificate I will surrender to the Company
with my endorsement. If the number of shares of Common
Stock represented by such stock certificate exceed the
number to be applied against the purchase price, I
understand that a new stock certificate will be issued
to me reflecting the excess number of shares.
[ ] by delivery of a stock certificate representing shares
of Common Stock that I have owned for at least six
months which I will surrender to the Company with my
endorsement as payment of the purchase price. If the
number of shares of Common Stock represented by such
certificate exceed the number to be applied against the
purchase price, I understand that a new certificate will
be issued to me reflecting the excess number of shares.
[ ] by delivery of the purchase price by ________________,
a broker, dealer or other "creditor" as defined by
Regulation T issued by the Board of Governors of the
Federal Reserve System. I hereby authorize the Company
to issue a stock certificate in number of shares
indicated above in the name of said broker, dealer or
other creditor or its nominee pursuant to instructions
received by the Company and to deliver said stock
certificate directly to that broker, dealer or other
creditor (or to such other party specified in the
instructions received by the Company from the broker,
dealer or other creditor) upon receipt of the purchase
price.
As soon as the stock certificate is registered in my name,
please deliver it to me at the above address.
If the Common Stock being acquired is not registered for
issuance to and resale by the Optionee pursuant to an effective
registration statement on Form S-8 (or successor form) filed
under the Securities Act of 1933, as amended (the "1933 Act"), I
hereby represent, warrant, covenant, and agree with the Company
as follows:
The shares of the Common Stock being acquired by me will
be acquired for my own account for investment and not with a
view to any further distribution thereof;
I understand that the Common Stock will be issued and
sold to me without registration under the 1933 Act and of
applicable state laws and I must hold the shares indefinitely
unless such shares are subsequently registered under such
laws or an exemption from registration is available;
The Company will be under no obligation to register the
Common Stock or to comply with any exemption available for
sale of the Common Stock without registration or filing or to
act in any manner so as to make Rule 144 available with
respect to the Common Stock;
I have had the opportunity to ask questions of and
receive answers from the Company and any person acting on its
behalf and to obtain all material information reasonably
available with respect to the Company and its affairs. I
have received all information and data with respect to the
Company which I have requested and which I have deemed
relevant in connection with the evaluation of the merits and
risks of my investment in the Company;
I have such knowledge and experience in financial and
business matters that I am capable of evaluating the merits
and risks of the purchase of the Common Stock hereunder and
I am able to bear the economic risk of such purchase;
I understand that the certificates representing the
shares being purchased by me in accordance with this notice
shall bear a legend referring to the foregoing covenants,
representations and warranties and restrictions on transfer,
and I agree that a legend to that effect may be placed on any
certificate which may be issued to me as a substitute for the
certificates being acquired by me in accordance with this
notice; and
I understand that mailing or delivery of this notice to you
constitutes an irrevocable exercise of the Option as to the
number of shares set forth above, creating a binding, legal
obligation on my part to purchase the shares.
Very truly yours,
AGREED TO AND ACCEPTED:
MORRISON RESTAURANTS INC.
By:
Title:
Number of Shares
Exercised:
Number of Shares
Remaining: Date:
MORRISON RESTAURANTS INC.
RESTRICTED STOCK AWARD
THIS AWARD is made by MORRISON RESTAURANTS INC. (the
"Company") to ____________________________________ (the
"Participant").
Upon and subject to the Terms and Conditions attached hereto
and incorporated herein by reference, the Company hereby awards
as of the Grant Date to Participant a restricted stock award (the
"Award") for the Award Shares, as described below:
A. Grant Date: [Insert the date the
Participant was first elected to the Board of Directors;
however, if the Participant was first elected to the
Board of Directors prior to September 28, 1994, the
effective date of the Plan, insert September 28, 1994].
B. Type of Award: Restricted Stock Award.
C. Plan (under which Award is granted): Morrison
Restaurants Inc. Stock Incentive and Deferred
Compensation Plan for Directors.
D. Award Shares: All or any part of 5,000 shares of the
Company's common stock (the "Common Stock").
E. Vesting of Award Shares: Award Shares vest in equal one-
third increments on each of the first three anniversary
dates of the date the Participant was first elected to
the Board of Directors. However, the Terms and
Conditions specify other events that either accelerate
the vesting or cease the vesting of additional Award
Shares.
IN WITNESS WHEREOF, the Company has executed and sealed this
Award as of the Grant Date set forth above.
MORRISON RESTAURANTS INC.
By:
Title:
TERMS AND CONDITIONS TO THE
RESTRICTED STOCK AWARD
UNDER THE MORRISON RESTAURANTS INC.
STOCK INCENTIVE AND DEFERRED COMPENSATION
PLANS FOR DIRECTORS
1. Vesting and Forfeiture of Award Shares. Subject to the
provisions provided herein or in the Award made pursuant to the
Morrison Restaurants Inc. Stock Incentive and Deferred
Compensation Plan for Directors:
(a) The Participant shall become vested in one-third of
the Award Shares on each of the first three anniversary dates
of the date the Participant was first elected to the Board of
Directors. However, if the Participant ceases to be a member
of the Board of Directors prior to the third anniversary of
his or her election to the Board of Directors, any unvested
Award Shares shall immediately be forfeited.
(b) Notwithstanding the preceding, all Award Shares
shall become vested on the date the Participant ceases to be
a member of the Board of Directors on account of death,
Disability (as defined in the Plan), upon attaining age 70 or
upon a Change in Control (as defined in the Plan).
2. Escrow of Award Shares. Any certificates representing
the Award Shares shall be issued in the Participant's name, but
shall be held by a custodian designated by the Committee (the
"Custodian") together with an undated assignment in blank of the
Award Shares executed by the Participant, until such time as such
Award Shares become vested or are forfeited. Until such time as
the Award Shares become vested or are forfeited, the Custodian is
appointed as the attorney-in-fact for the Participant with full
power and authority in the Participant's name, place and stead to
transfer, assign and convey to the Company any Award Shares held
by the Custodian for such Participant if the Participant forfeits
such shares. In the event the Award Shares become vested, the
Custodian shall deliver the certificate for such vested shares to
the Participant; provided that the Participant executes and
delivers to the Custodian substitute undated assignments for any
replacement certificates representing the shares subject to
restrictions, as may be necessary. In the event the Participant
forfeits any or all of the Award Shares, the Custodian shall date
the assignment and deliver the certificate for such shares to the
Company.
3. Rights as Shareholder. The Participant shall have all
rights as a stockholder, including the receipt of dividends, with
respect to any Award Shares as of the Grant Date, but not after
any date any such Award Shares are forfeited.
4. Restriction on Transfer of Award. Unvested Award Shares
may not be conveyed, sold, transferred, assigned, pledged,
hypothecated or otherwise disposed of by the Participant. Any
attempt to transfer unvested Award Shares shall be void.
5. Changes in Capitalization; Merger; Liquidation.
(a) The number of Award Shares shall be proportionately
adjusted for any increase or decrease in the number of issued
shares of Common Stock resulting from a subdivision or
combination of shares or the payment of a stock dividend in
shares of Common Stock to holders of outstanding shares of
Common Stock or any other increase or decrease in the number
of shares of Common Stock outstanding effected without
receipt of consideration by the Company.
(b) If the Company shall be the surviving corporation
in any merger or consolidation, recapitalization,
reclassification of shares or similar reorganization, the
Participant shall be eligible to receive the number and class
of securities to which a holder of the number of shares of
Common Stock subject to the Award at the time of such
transaction would have been eligible to receive as a result
of such transaction.
(c) The existence of the Plan and the Award shall not
affect in any way the right or power of the Company to make
or authorize any adjustment, reclassification, reorganization
or other change in its capital or business structure, any
merger or consolidation of the Company, any issue of debt or
equity securities having preferences or priorities as to the
Common Stock or the rights thereof, the dissolution or
liquidation of the Company, any sale or transfer of all or
any part of its business or assets, or any other corporate
act or proceeding.
(d) If, because the number of shares of Common Stock of
the Company are increased or reduced by reason of a
subdivision or combination of shares or the payment of a
stock dividend in shares or any other increase or decrease in
the number of shares, the Participant is eligible to receive
additional shares or to be issued a replacement certificate
for Common Stock attributable to this Award, such additional
shares and replacement certificate shall be subject to all
the terms and conditions of this Award.
6. Special Limitation on Exercise. Any issuance of the
Award Shares is subject to the condition that if at any time the
Committee, in its discretion, shall determine that the listing,
registration or qualification of the shares covered by the Award
upon any securities exchange or under any state or federal law is
necessary or desirable as a condition of or in connection with
the delivery of shares thereunder, the delivery of any or all
shares pursuant to the Award may be withheld unless and until
such listing, registration or qualification shall have been
effected. The Participant shall deliver to the Company, prior to
the exercise of the Award, such information, representations and
warranties as the Company may reasonably request in order for the
Company to be able to satisfy itself that the Award Shares are
being acquired in accordance with the terms of an applicable
exemption from the securities registration requirements of
applicable federal and state securities laws.
7. Legend on Stock Certificates. Certificates evidencing
the Award Shares, to the extent appropriate at the time, shall
have noted conspicuously on the certificates a legend intended to
give all persons full notice of the existence of the conditions,
restrictions, rights and obligations set forth in the Award,
these Terms and Conditions and the Plan.
8. Governing Laws. This Award shall be construed,
administered and enforced according to the laws of the State of
Alabama.
9. Successors. The Award and these Terms and Conditions
shall be binding upon and inure to the benefit of the heirs,
legal representatives, successors and permitted assigns of the
parties.
10. Notice. Except as otherwise specified herein, all
notices and other communications under the Award shall be in
writing and shall be deemed to have been given if personally
delivered or if sent by registered or certified United States
mail, return receipt requested, postage prepaid, addressed to the
proposed recipient at the last known address of the recipient.
Any party may designate any other address to which notices shall
be sent by giving notice of the address to the other parties in
the same manner as provided herein.
11. Severability. In the event that any one or more of the
provisions or portion thereof contained in the Award and these
Terms and Conditions shall for any reason be held to be invalid,
illegal or unenforceable in any respect, the same shall not
invalidate or otherwise affect any other provisions of the Award
and these Terms and Conditions, and the Award and these Terms and
Conditions shall be construed as if the invalid, illegal or
unenforceable provision or portion thereof had never been
contained herein.
12. Entire Agreement. Subject to the terms and conditions
of the Plan, the Award and these Terms and Conditions express the
entire understanding and agreement of the parties.
13. Violation. Any transfer, pledge, sale, assignment, or
hypothecation of the Award or any portion thereof shall be a
violation of the terms of the Award and these Terms and
Conditions and shall be void and without effect.
14. Headings. Paragraph headings used herein are for
convenience of reference only and shall not be considered in
construing the Award or these Terms and Conditions.
15. Specific Performance. In the event of any actual or
threatened default in, or breach of, any of the terms, conditions
and provisions of the Award and these Terms and Conditions, the
party or parties who are thereby aggrieved shall have the right
to specific performance and injunction in addition to any and all
other rights and remedies at law or in equity, and all such
rights and remedies shall be cumulative.
16. Right to Remove Director. Neither the establishment of
the Plan nor the award of Award Shares hereunder shall be
construed as giving the Participant the right to continued
directorship.
MORRISON RESTAURANTS INC.
DEFERRED COMPENSATION PLAN
(As Restated Effective January 1, 1994)
THIS INDENTURE made on the 31 day of December, 1993, by
MORRISON RESTAURANTS INC., f/k/a Morrison Incorporated, a
corporation duly organized and existing under the laws of the
State of Delaware (hereinafter called the "Primary Sponsor");
W I T N E S S E T H:
WHEREAS, the Primary Sponsor established by indenture
effective as of January 1, 1988 the Morrison Incorporated
Deferred Compensation Plan for the benefit of a select group of
management and highly compensated employees, which was amended
and restated by indenture dated December 18, 1989 and which was
last amended by indenture dated December 1, 1992 (the "Plan");
and
WHEREAS, the Primary Sponsor desires to amend and restate
the Plan to revise the manner by which eligible members may
select rates of returns to be credited to their accounts and
for other reasons;
NOW, THEREFORE, the Primary Sponsor does hereby amend and
restate the Plan, effective January 1, 1994, to read as
follows:
MORRISON RESTAURANTS INC.
DEFERRED COMPENSATION PLAN
TABLE OF CONTENTS
SECTION 1 DEFINITIONS
SECTION 2 ELIGIBILITY
SECTION 3 DEFERRAL ELECTIONS
SECTION 4 CREDITING ACCOUNTS
SECTION 5 HARDSHIP PAYMENTS
SECTION 6 DEATH BENEFITS
SECTION 7 PAYMENT OF BENEFITS ON RETIREMENT
OR DEATH
SECTION 8 PAYMENT OF BENEFITS ON OTHER
TERMINATIONS OF EMPLOYMENT
SECTION 9 ADMINISTRATION OF THE PLAN
SECTION 10 CLAIM REVIEW PROCEDURE
SECTION 11 LIMITATION OF ASSIGNMENT, PAYMENTS TO
LEGALLY INCOMPETENT DISTRIBUTEE AND
UNCLAIMED PAYMENTS
SECTION 12 LIMITATION OF RIGHTS
SECTION 13 AMENDMENT TO OR TERMINATION OF THE PLAN
SECTION 14 ADOPTION OF PLAN BY AFFILIATES
SECTION 15 MISCELLANEOUS
<PAGE>
SECTION 1
DEFINITIONS
Whenever used herein, the masculine pronoun shall be
deemed to include the feminine, and the singular to include the
plural, unless the context clearly indicates otherwise, and the
following words and phrases shall, when used herein, have the
meanings set forth below:
1.1 "Account" means the bookkeeping accounts established
and maintained by the Plan Administrator to reflect the
interest of a Member under the Plan and shall include the
following:
(a) "Employee Deferred Account" which shall reflect
credits to a Member's Account made on his behalf pursuant
to Plan Section 3.1, as adjusted to reflect designated
rates of return and other credits or charges.
(b) "Company Matching Account" which shall reflect
credits to a Member's Account made on his behalf pursuant
to Plan Section 3.2, as adjusted to reflect designated
rates of return and other credits or charges.
1.2 "Accrued Benefit" means the balance of a Member's
Account.
1.3 "Affiliate" means (a) any corporation which is a
member of the same controlled group of corporations (within the
meaning of Code Section 414(b)) as is a Plan Sponsor and
(b) any other trade or business (whether or not incorporated)
under common control (within the meaning of Code Section
414(c)) with a Plan Sponsor.
1.4 "Annual Compensation" means "Annual Compensation,"
as that term is defined under the Salary Deferral Plan for
purposes of making contributions pursuant to a salary deferral
election, as the same may be amended from time to time, but
without regard to the limit on compensation that may be
recognized under Code Section 401(a)(17), plus any Deferral
Amounts credited to a Member during the Plan Year.
1.5 "Beneficiary" means the person or trust that a Member
designated most recently in writing to the Plan Administrator;
provided, however, that if the Member has failed to make a
designation, no person designated is alive, no trust has been
established, or no successor Beneficiary has been designated
who is alive, the "Beneficiary" means (a) the Member's spouse
or (b) if no spouse is alive, the Member's surviving children,
or (c) if no children are alive, the Member's parents, or
(d) if no parent is alive, the legal representative of the
deceased Member's estate. Changes in designations of
Beneficiaries may be made upon written notice to the Plan
Administrator in such form as the Plan Administrator may
prescribe.
1.6 "Board of Directors" means the Board of Directors of
the Primary Sponsor.
1.7 "Change of Control" means any event that pursuant to
the requirements of Article X of the Primary Sponsor's
Certificate of Incorporation, as amended from time to time,
requires the affirmative vote of the holders of not less than
eighty percent (80%) of the Voting Stock (as defined therein);
provided, however, that no event shall constitute a Change of
Control if approved by the Board of Directors a majority of
whom are "present directors" and "new directors." For purposes
of the preceding sentence, "present directors" shall mean
individuals who as of January 1, 1993 were members of the Board
of Directors and "new directors" shall mean any director whose
election by the Board of Directors in the event of a vacancy or
whose nomination for election by the Primary Sponsor's
stockholders was approved by a vote of at least three-quarters
of the directors then still in office who are "present
directors" and "new directors;" provided that any director
elected to the Board of Directors solely to settle a threatened
or actual proxy contest shall in no event be deemed to be a
"new director."
1.8 "Code" means the Internal Revenue Code of 1986, as
amended.
1.9 "Company Stock Rate of Return" means a designated
rate of return that corresponds, in whole or in part, to
changes in the value of securities of the Primary Sponsor or
any affiliate.
1.10 "Deferral Amount" means an amount credited to the
Employee Deferred Account of a Member at the election of a
Member pursuant to Plan Section 3.1.
1.11 "Disability" means a disability of a Member within
the meaning of Code Section 72(m)(7), to the extent that the
Member is, or would be, entitled to disability retirement
benefits under the federal Social Security Act or to the extent
that the Member is entitled to recover benefits under any long-
term disability plan or policy maintained by the Plan Sponsor.
The determination of whether or not a Disability exists shall
be determined by the Plan Administrator and shall be
substantiated by competent medical evidence.
1.12 "Effective Date" means, as to the Primary Sponsor,
January 1, 1988, and as to each other Plan Sponsor which adopts
the Plan, the date designated as such by the adopting Plan
Sponsor.
1.13 "Eligible Employee" means any person who is a
"highly compensated employee," within the meaning of Code
Section 414(q), as amended.
1.14 "Employee" means any person who is employed by a
Plan Sponsor or an Affiliate for purposes of the Federal
Insurance Contributions Act.
1.15 "Entry Date" means the first day of each payroll
period.
1.16 "Member" means any Eligible Employee or former
Eligible Employee who has become a participant in the Plan, for
so long as his benefits hereunder have not been paid out.
1.17 "Plan Administrator" means the organization or
person designated by the Primary Sponsor to administer the Plan
or, in the absence of any such designation, the Primary
Sponsor.
1.18 "Plan Sponsor" means individually the Primary
Sponsor and any other Affiliate or other entity which has
adopted the Plan.
1.19 "Plan Year" means the calendar year.
1.20 "Reporting Person" means each Member who, on a
particular date or dates, the Primary Sponsor reasonably
believes is subject to the reporting requirements of Section
16(a) of the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder, with respect
to equity securities of the Primary Sponsor or any affiliate.
1.21 "Retirement Date" means the first day of the month
coinciding with or immediately following the date on which the
Member retires on or after attaining age 55 or becoming subject
to a Disability.
1.22 "Salary Deferral Plan" means the Morrison
Restaurants Inc. Salary Deferral Plan, as the same may be
amended from time to time.
1.23 "Valuation Date" means the last day of each month or
any other day which the Plan Administrator declares to be a
Valuation Date.
SECTION 2
ELIGIBILITY
2.1 Each Eligible Employee shall become a Member as
of the Entry Date coinciding with or next following the date on
which the Eligible Employee is identified by the Plan
Administrator as a "highly compensated employee," within the
meaning of Code Section 414(q), as amended.
2.2 A Member who ceases to be an Eligible Employee will
no longer be eligible to make further deferrals under the Plan
pursuant to Plan Section 3, but shall continue to be subject to
all other terms of the Plan so long as he remains a Member of
the Plan.
2.3 In the event the Member participates in a plan of a
Plan Sponsor or Affiliate intended to qualify under Code
Section 401(a) and containing a tax-qualified cash or deferred
arrangement qualified under Code Section 401(k), the Member
shall be suspended from continued participation under this Plan
to the extent required by such other plan as a result of a
hardship withdrawal made by such Member under such other plan.
SECTION 3
DEFERRAL ELECTIONS
3.1 Each Plan Year a Member who is an Eligible Employee
may elect to defer under the Plan a portion of the Annual
Compensation otherwise payable to him for the Plan Year, which
amount shall be at least two percent (2%) of Annual
Compensation and shall be in increments of one percent (1%) of
Annual Compensation, but not in excess of twenty percent (20%)
of Annual Compensation.
3.2 All elections to defer Annual Compensation under
Plan Section 3.1 may only be made pursuant to an agreement
between the Member and the Plan Sponsor which shall be in such
form and subject to such rules and limitations as the Plan
Administrator may prescribe and shall specify the amount of the
Annual Compensation of the Member that the Member desires to
defer. Once a Member has made an election for a Plan Year, the
Member may revoke or modify his election to reduce the rate of
future deferrals, effective as of the beginning of the payroll
period coinciding with or next following the Plan
Administrator's processing of the revocation or modification
pursuant to normal administrative procedures. Once an election
has been revoked or modified, any subsequent election by the
Member shall be effective as of the first day of the first
payroll period coinciding with or next following the Plan
Administrator's processing of the election pursuant to normal
administrative procedures, except that at the request of a
Member in a form acceptable to the Plan Administrator, the
election may be given effect at a later date.
3.3 (a) Each Plan Sponsor proposes to credit on behalf
of each Member employed by that Plan Sponsor for
allocation to that Member's Company Matching Account an
amount equal to twenty percent (20%) of the Deferral
Amounts of a Member in the case of a Member who has been
employed by a Plan Sponsor for at least three (3) years,
but fewer than ten (10) years; (B) thirty percent (30%) of
the Deferral Amounts of a Member in the case of a Member
who has been employed by a Plan Sponsor for at least ten
(10) years, but fewer than twenty (20) years; or (C) forty
percent (40%) of the Deferral Amounts of a Member in the
case of a Member who either (I) has been employed by a
Plan Sponsor for at least twenty (20) years or (II) is
designated by the Plan Administrator, with the consent of
the Plan Sponsor, as one of a select group of Members to
receive such a matching credit.
Matching credits under Section 3.3(a) for any Plan Year
shall only be credited with respect to annual Deferral
Amounts of each Member equal to the Code Section 402(g)
limitation, as adjusted annually for inflation.
(b) For purposes of determining matching amounts to
be credited to a Member's Company Matching Account under
Plan Section 3.3(a), all or a portion of a Member's years
of employment with a predecessor employer may be counted
if at the time the individual became an Employee, or as
soon as practicable thereafter, the Plan Sponsor adopts
resolutions providing for the counting of such years of
employment in favor of that Member or of a group or
category of individuals that included the Member. The
counting of any such years of employment shall be
specified in those resolutions and shall be subject to
such conditions, if any, provided therein.
SECTION 4
CREDITING ACCOUNTS
4.1 As of each Valuation Date, Deferral Amounts
previously elected by a Member shall be credited to the
Member's Employee Deferred Account.
4.2 As of the last Valuation Date of each Plan Year or
any earlier Valuation Dates as may be selected by the Plan
Administrator, the amounts to be credited for the applicable
period pursuant to Plan Section 3.3 on behalf of a Member shall
be credited to the Member's Company Matching Account.
4.3 (a) As of each Valuation Date, each Member's Company
Matching Account (other than any Member who has received a
distribution of his Accrued Benefit prior to that
Valuation Date) shall be credited with a Company Stock
Rate of Return based upon the amount credited to the
Member's Company Matching Account as of the immediately
preceding Valuation Date.
(b) As of each Valuation Date, each Member's
Employee Deferred Account (other than any Member who has
received a distribution of his Accrued Benefit prior to
that Valuation Date) or portions thereof shall be credited
with a designated rate or rates of return, as applicable,
as selected by the Member, based upon the amount credited
to the Member's Employee Deferred Account as of the
immediately preceding Valuation Date. A Member's Employee
Deferred Account may be credited with such rate or rates
of return in accordance with the most recent investment
election properly and timely filed by the Member with the
Plan Administrator in accordance with such rules and
procedures designated by the Primary Sponsor. If no
election has been properly or timely filed with the Plan
Administrator or if the Plan Administrator suspends the
election of rates of return by Members, the Member's
Employee Deferred Account or Members' Employee Deferred
Accounts, as applicable, shall be credited with a
designated rate of return selected by the Primary Sponsor.
Any selection of designated rates of return by Reporting
Persons shall be subject to the restriction of Plan
Section 4.3(d).
(c) As of the last day of any Plan Year, one or
more Member's Employee Deferred Account (other than any
Member who has received a distribution of his Accrued
Benefit prior thereto) may be credited by the Plan Sponsor
with an additional amount as may be determined by the Plan
Sponsor in its sole discretion.
(d) Except as otherwise provided in this Section, no
Reporting Person shall be eligible to select a designated
rate of return for any portion of his Employee Deferred
Account that corresponds, in whole or in part, to changes
in value of securities of the Primary Sponsor or any
Affiliate (the "Company Stock Rate of Return") and if any
Member becomes a Reporting Person during a Plan Year and
that Member has elected for the Plan Year a Company Stock
Rate of Return for any portion of his Employee Deferred
Account, that portion of the Member's Employee Deferred
Account shall be credited with a rate of return for the
portion of the Plan Year ending with the Valuation Date
immediately prior to the Member's becoming a Reporting
Person, if any, equal to the Company Stock Rate of Return
and, for the remainder of the Plan Year or until such
earlier time as the Member elects an alternative
designated rate of return pursuant to Plan Section 4.3(b),
the rate of return (among those designated rates of return
made available by the Plan Administrator for the Plan
Year, other than the Company Stock Rate of Return) earning
the lowest return for the Plan Year. Notwithstanding the
foregoing provisions of this Section, the Plan
Administrator may in its discretion allow a Member who is
a Reporting Person or who becomes a Reporting Person to
select or to preserve a prior selection of a Company Stock
Rate of Return with respect to all or any portion of the
Member's Employee Deferred Account, in which case the
foregoing provisions of this Section shall not be given
effect as to that Member. The selection or preservation
of a prior selection of a Company Stock Rate of Return by
a Reporting Person pursuant to this Section shall be
subject to such terms and conditions as the Plan
Administrator may from time to time prescribe.
SECTION 5
HARDSHIP PAYMENTS
5.1 The Plan Administrator may pay all or a portion of a
Member's Deferral Amounts (reduced by negative rates of return
experienced) prior to the time such amounts otherwise become
payable in accordance with the provisions of the Plan;
provided, however, that any such distribution shall be made
only if the Member is an Employee and demonstrates that he is
suffering from "Hardship," as that term is defined under the
Salary Deferral Plan, as amended, and any other unforeseeable
circumstance determined to constitute a "Hardship"for purposes
of this Section by the Plan Administrator. For purposes of
this Section, the Plan Administrator shall have the sole and
absolute discretion, which shall be exercised in a
nondiscriminatory and uniform manner, to determine if a
"Hardship" exists with respect to a Member.
5.2 Hardship payments shall be made to a Member only in
accordance with such rules, policies, procedures, restrictions,
and conditions as the Plan Administrator may from time to time
adopt. Any determination of the amount to be distributed on
account of a Hardship shall be made by the Plan Administrator
in accordance with rules applied in a uniform and
nondiscriminatory manner. A payment under this Section shall
be made in a lump sum in cash to the Member and shall be
charged against the Member's Employee Deferred Account as of
the Valuation Date coinciding with or immediately preceding the
date of the payment.
SECTION 6
DEATH BENEFITS
6.1 Upon the death of a Member who dies prior to the
date on which he is entitled to the commencement of payments of
his Account, the Member's Beneficiary shall be entitled to the
full value of the Member's Account.
6.2 Upon the death of a Member who is no longer an
Employee, but prior to the complete payment of his Account, the
Member's Beneficiary shall be entitled to receive the unpaid
portion of the Member's Account. These payments shall be made
according to the manner and method by which payments were being
made to the Member during his lifetime, except as provided by
Plan Section 6.4.
6.3 If, subsequent to the death of a Member, the
Member's Beneficiary dies while entitled to receive benefits
under the Plan, the successor Beneficiary, if any, or the
Beneficiary listed under Subsection (a), (b) or (c) of the Plan
Section containing the definition of the term "Beneficiary"
shall generally be entitled to receive benefits under the
Plan. However, if the deceased Beneficiary was the Member's
spouse at the time of the Member's death, or if no successor
Beneficiary shall have been designated by the Member and be
alive and no Beneficiary listed under Subsection (a), (b) or
(c) of the Plan Section containing the definition of the term
"Beneficiary" shall be alive, the Member's unpaid vested
Accrued Benefit shall be paid to the personal representative of
the deceased Beneficiary's estate.
6.4 If the Beneficiary is the estate of the Member, the
Plan Sponsor shall make payment of the unpaid balance of the
Member's Account in the form of a single lump-sum payment equal
to the unpaid balance of the Member's Account as of the
Valuation Date immediately preceding payment.
6.5 Any benefit payable under this Section 6 shall be
paid in accordance with and subject to the provisions of Plan
Section 7 after receipt by the Plan Administrator of notice of
the death of the Member.
SECTION 7
PAYMENT OF BENEFITS ON RETIREMENT OR DEATH
7.1 Upon the retirement or death of a Member, the
Accrued Benefit of the Member shall be determined as of the
Valuation Date coinciding with or immediately preceding the
Member's Retirement Date or death, increased by Deferral
Amounts and amounts credited pursuant to Plan Section 4.2
thereafter and adjusted for the appropriate designated rates of
return and any other amounts credited pursuant to Plan Section
4.3 through the Valuation Date immediately preceding the date
the Accrued Benefit is paid. Payment of the Member's Accrued
Benefit shall commence no later than sixty (60) days after the
Retirement Date or death of the Member.
7.2 The form of payment of the Accrued Benefit of a
Member shall be selected by the Plan Administrator and shall be
in either a lump sum or annual or more frequent installments.
The payment of a Member's Accrued Benefit shall be in cash or
such other property as determined by the Primary Sponsor;
except that on or after a Change of Control, payment of a
Member's Accrued Benefit shall be in cash. Notwithstanding the
foregoing, the Accrued Benefit of any Member who is or was a
Reporting Person at any time within six (6) months prior to the
date that his Accrued Benefit is paid shall be paid in cash.
SECTION 8
PAYMENT OF BENEFITS ON OTHER TERMINATIONS OF EMPLOYMENT
8.1 A Member shall be considered to have terminated
employment with the Plan Sponsor or any Affiliate on the date
determined by the Plan Administrator. Transfer of a Member
from one Plan Sponsor to another Plan Sponsor shall not be
deemed for any purpose under the Plan to be a termination of
employment by the Member.
8.2 In the event of the termination of employment of a
Member for reasons other than those specified in Sections 6 and
7 above, the Accrued Benefit of the Member shall be determined
as of the Valuation Date coinciding with or immediately
preceding the date of the termination of employment and shall
be increased by any Deferral Amounts credited to the Employee
Deferred Account of the Member since that Valuation Date.
While no further amounts credited pursuant to Plan Section 4.2
shall be made to the Member's Account after that Valuation
Date, the Member's Account shall be adjusted for the
appropriate designated rates of return and any other amounts
credited pursuant to Plan Section 4.3 through the Valuation
Date immediately preceding the date the Accrued Benefit is
paid.
8.3 A Member shall be entitled to payment of his
Accrued Benefit in the form set forth in Plan Section 7.2.
Payment shall commence at any time which the Plan Administrator
may select following termination of employment, which shall not
be later than sixty (60) days after the end of the Plan Year in
which the Member attains age 65.
SECTION 9
ADMINISTRATION OF THE PLAN
9.1 Operation of the Plan Administrator. The Primary
Sponsor shall be the Plan Administrator, unless it appoints
another Plan Administrator. If an organization is appointed to
serve as the Plan Administrator, then the Plan Administrator
may designate in writing a person who may act on behalf of the
Plan Administrator. The Primary Sponsor shall have the right
to remove the Plan Administrator at any time by notice in
writing. The Plan Administrator may resign at any time by
written notice or resignation to the Primary Sponsor. Upon
removal or resignation, or in the event of the dissolution of
the Plan Administrator, the Primary Sponsor shall appoint a
successor.
9.2 Duties of the Plan Administrator.
(a) The Plan Administrator shall perform any act
which the Plan authorizes or requires of the Plan
Administrator by action taken in compliance with the Plan
and may designate in writing other persons to carry out
its duties under the Plan. The Plan Administrator may
employ persons to render advice with regard to any of the
Plan Administrator's duties.
(b) The Plan Administrator shall from time to time
establish rules, not contrary to the provisions of the
Plan, for the administration of the Plan and the
transaction of its business. All elections and
designations under the Plan by a Member or Beneficiary
shall be made on forms prescribed by the Plan
Administrator. The Plan Administrator shall have
discretionary authority to construe the terms of the Plan
and shall determine all questions arising in the
administration, interpretation and application of the
Plan, including, but not limited to, those concerning
eligibility for benefits and it shall not act so as to
discriminate in favor of any person. All determinations
of the Plan Administrator shall be conclusive and binding
on all Members and Beneficiaries, subject to the
provisions of the Plan and subject to applicable law.
(c) The Plan Administrator shall furnish Members and
Beneficiaries with all disclosures now or hereafter
required by the Employee Retirement Income Security Act of
1974, as amended ("ERISA"). The Plan Administrator shall
file, as required, the various reports and disclosures
concerning the Plan and its operations as required by
ERISA and by the Code, and shall be solely responsible for
establishing and maintaining all records of the Plan.
(d) The statement of specific duties for a Plan
Administrator in this Section is not in derogation of any
other duties which a Plan Administrator has under the
provisions of the Plan or under applicable law.
(e) Each Plan Sponsor shall indemnify and hold
harmless each person constituting the Plan Administrator
from and against any and all claims and expenses
(including, without limitation, attorney's fees and
related costs) arising in connection with the performance
by the person of his duties in that capacity, other than
any of the foregoing arising in connection with the
willful neglect or willful misconduct of the person
acting.
9.3 Action by the Primary Sponsor or a Plan Sponsor.
Any action to be taken by the Primary Sponsor or a Plan Sponsor
shall be taken by resolution or written direction duly adopted
by its board of directors or appropriate governing body, as the
case may be; provided, however, that by such resolution or
written direction, the board of directors or appropriate
governing body, as the case may be, may delegate to any officer
or other appropriate person of a Plan Sponsor the authority to
take any such actions as may be specified in such resolution or
written direction, other than the power to amend, modify or
terminate the Plan or to determine the basis of any payment
obligations of any Plan Sponsor.
SECTION 10
CLAIM REVIEW PROCEDURE
10.1 In the event that a Member or Beneficiary is denied
a claim for benefits under a Plan, the Plan Administrator shall
provide to such claimant written notice of the denial which
shall set forth:
(a) the specific reasons for the denial;
(b) specific references to the pertinent provisions
of the Plan on which the denial is based;
(c) a description of any additional material or
information necessary for the claimant to perfect the
claim and an explanation of why such material or
information is necessary; and
(d) an explanation of the Plan's claim review
procedure.
10.2 After receiving written notice of the denial of a
claim, a claimant or his representative may:
(a) request a full and fair review of such denial by
written application to the Plan Administrator;
(b) review pertinent documents; and
(c) submit issues and comments in writing to the
Plan Administrator.
10.3 If the claimant wishes such a review of the
decision denying his claim to benefits under the Plan, he must
submit such written applications to the Plan Administrator
within sixty (60) days after receiving written notice of the
denial.
10.4 Upon receiving such written application for review,
the Plan Administrator may schedule a hearing for purposes of
reviewing the claimant's claim, which hearing shall take place
not more than thirty (30) days from the date on which the Plan
Administrator received such written application for review.
10.5 At least ten (10) days prior to the scheduled
hearing, the claimant and his representative designated in
writing by him, if any, shall receive written notice of the
date, time, and place of such scheduled hearing. The claimant
or his representative, if any, may request that the hearing be
rescheduled, for his convenience, on another reasonable date or
at another reasonable time or place.
10.6 All claimants requesting a review of the decision
denying their claim for benefits may employ counsel for
purposes of the hearing.
10.7 No later than sixty (60) days following the receipt
of the written application for review, the Plan Administrator
shall submit its decision on the review in writing to the
claimant involved and to his representative, if any; provided,
however, a decision on the written application for review may
be extended, in the event special circumstances such as the
need to hold a hearing require an extension of time, to a day
no later than one hundred twenty (120) days after the date of
receipt of the written application for review. The decision
shall include specific reasons for the decision and specific
references to the pertinent provisions of the Plan on which the
decision is based.
SECTION 11
LIMITATION OF ASSIGNMENT, PAYMENTS TO LEGALLY
INCOMPETENT DISTRIBUTEE AND UNCLAIMED PAYMENTS
11.1 No benefit which shall be payable under the Plan to
any person shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance or
charge, and any attempt to anticipate, alienate, sell,
transfer, assign, pledge, encumber or charge the same shall be
void; and no such benefit shall in any manner be liable for, or
subject to, the debts, contracts, liabilities, engagements or
torts of any person, nor shall it be subject to attachment or
legal process for, or against, such person, and the same shall
not be recognized under the Plan, except to such extent as may
be required by law.
11.2 If any person who shall be entitled to any benefit
under the Plan shall become bankrupt or shall attempt to
anticipate, alienate, sell, transfer, assign, pledge, encumber
or charge such benefit under the Plan, then the payment of any
such benefit in the event a Member or Beneficiary is entitled
to payment shall, in the discretion of the Plan Administrator,
cease and terminate and in that event the Plan Administrator
shall hold or apply the same for the benefit of such person,
his spouse, children, other dependents or any of them in such
manner and in such proportion as the Plan Administrator shall
determine.
11.3 Whenever any benefit which shall be payable under
the Plan is to be paid to or for the benefit of any person who
is then a minor or determined to be incompetent by qualified
medical advice, the Plan Administrator need not require the
appointment of a guardian or custodian, but shall be authorized
to cause the same to be paid over to the person having custody
of such minor or incompetent, or to cause the same to be paid
to such minor or incompetent without the intervention of a
guardian or custodian, or to cause the same to be paid to a
legal guardian or custodian of such minor or incompetent if one
has been appointed or to cause the same to be used for the
benefit of such minor or incompetent.
11.4 Whenever the Plan Administrator cannot, within a
reasonable time after payments are to commence, locate any
person to or for the benefit of whom such payments are to be
made, after making a reasonable effort to locate such person,
the Plan Administrator may direct that the payment and any
remaining payments otherwise due to the Member be cancelled on
the records of the Plan, except that in the event the Member
later notifies the Plan Administrator of his whereabouts and
requests the payments due to him under the Plan, the Plan
Sponsor shall re-credit the Member's account and provide for
payment of the re-credited amount to the Member as soon as
administratively feasible.
SECTION 12
LIMITATION OF RIGHTS
Membership in the Plan shall not give any Employee any
right or claim except to the extent that such right is
specifically fixed under the terms of the Plan. The adoption
of the Plan by any Plan Sponsor shall not be construed to give
any Employee a right to be continued in the employ of a Plan
Sponsor or as interfering with the right of a Plan Sponsor to
terminate the employment of any Employee at any time.
SECTION 13
AMENDMENT TO OR TERMINATION OF THE PLAN
13.1 The Primary Sponsor reserves the right at any time
to modify or amend or terminate the Plan. No such
modifications or amendments shall have the effect of
retroactively changing or depriving Members or Beneficiaries of
benefits already accrued under the Plan. No Plan Sponsor other
than the Primary Sponsor shall have the right to so modify,
amend or terminate the Plan. Notwithstanding the foregoing,
each Plan Sponsor may terminate its own participation in the
Plan.
13.2 Each Plan Sponsor other than the Primary Sponsor
shall have the right to terminate its participation in the Plan
by resolution of its board of directors or other appropriate
governing body and notice in writing to the Primary Sponsor.
Any termination by a Plan Sponsor shall not be a termination as
to any other Plan Sponsor.
13.3 If the Plan is terminated by the Primary Sponsor it
shall terminate as to all Plan Sponsors.
SECTION 14
ADOPTION OF PLAN BY AFFILIATES
Any corporation or other business entity related to the
Primary Sponsor by function or operation and any Affiliate, if
the corporation, business entity or Affiliate is authorized to
do so by written direction adopted by the Board of Directors,
may adopt the Plan by action of the board of directors or other
appropriate governing body of such corporation, business entity
or Affiliate. Any adoption shall be evidenced by certified
copies of the resolutions of the foregoing board of directors
or governing body indicating the adoption by the adopting
corporation, or business entity or Affiliate. The resolution
shall state and define the Effective Date of the adoption of
the Plan by the Plan Sponsor.
SECTION 15
MISCELLANEOUS
15.1 All payments provided under the Plan shall be paid
from the general assets of the applicable Plan Sponsor and no
separate fund shall be established to secure payment.
Notwithstanding the foregoing, the Primary Sponsor may
establish a grantor trust to assist it and other Plan Sponsors
in funding Plan obligations, and any payments made to a Member
or Beneficiary from such trust shall relieve the Plan Sponsor
from any further obligations under the Plan only to the extent
of such payment.
15.2 Each Plan Sponsor shall withhold from any benefits
payable under the Plan all federal, state and local income
taxes or other taxes required to be withheld pursuant to
applicable law.
15.3 To the extent not preempted by applicable federal
law, the Plan shall be governed by and construed in accordance
with the laws of the State of Alabama.
IN WITNESS WHEREOF, the Primary Sponsor has caused this
indenture to be executed as of the date first above written.
MORRISON RESTAURANTS INC.
By:/s/ Samuel E. Beall, III
Title: President and Chief
Executive Officer
ATTEST:
/s/ Pfilip G. Hunt
Title: Senior Vice President
General Councel & Secretary
[CORPORATE SEAL]
TRUST AGREEMENT
THIS TRUST AGREEMENT made as of the 1 day of December,
1992, by and among Morrison Restaurants Inc., formerly Morrison
Incorporated, a corporation organized under the laws of the State
of Delaware (the "Primary Sponsor"), each related corporation or
business executing this Trust Agreement (the Primary Sponsor and
each related corporation or business being sometimes hereinafter
referred to as a "Plan Sponsor"); and AmSouth Bank N.A. (the
"Trustee");
W I T N E S S E T H:
WHEREAS, the Primary Sponsor by indenture effective as of
January 1, 1988 established the Morrison Incorporated Deferred
Compensation Plan to provide benefits in the form of deferred
compensation to a select group of management or highly
compensated employees of the Primary Sponsor or any of its
related corporations or businesses; and
WHEREAS, the Morrison Incorporated Deferred Compensation
Plan has been renamed the Morrison Restaurants Inc. Deferred
Compensation Plan (the "Plan"); and
WHEREAS, the Primary Sponsor by agreement dated June 16,
1988 established an irrevocable grantor trust (the "Trust"),
within the meaning of Section 671 of the Internal Revenue Code of
1986, as amended (the "Code") to assist the Primary Sponsor and
any of its related corporations or businesses in meeting its
obligations under the Plan; and
WHEREAS, the Primary Sponsor desires to amend and restate
the trust agreement between the Primary Sponsor and AmSouth Bank
N.A., dated as of May 1, 1990 and last amended by indenture dated
May 8, 1992, which agreement, as amended, contains the existing
terms of the Trust (the "Prior Trust Agreement"); and
WHEREAS, the Board of Directors of the Primary Sponsor has
approved the amendment and restatement of the Prior Trust
Agreement as embodied herein (the "Trust Agreement");
NOW, THEREFORE, the Primary Sponsor hereby restates the
Trust, effective as of January 1, 1993, as follows:
SECTION 1.
INCORPORATION OF PLAN
All terms and conditions set forth in the Plan are
incorporated by reference except to the extent that the terms of
the Trust indicate to the contrary. In the event of a conflict
between the terms and provisions of the Trust Agreement and those
the Plan, the terms and provisions of the Trust Agreement shall
be given precedence. However, nothing contained in the Trust
Agreement is intended to diminish the amount of benefits required
to be paid for the benefit of any participant under the terms of
the Plan. To the extent possible, the terms and provisions of
the Plan and those of the Trust Agreement shall be interpreted as
mutually consistent.
SECTION 2.
ESTABLISHMENT OF THE FUND
The Primary Sponsor has established a fund with the Trustee
(the "Fund") to be held and administered in accordance with this
Trust. The Trustee shall accept as part of the Fund all assets
as may be delivered by a Plan Sponsor to the Trustee and shall
also include all income accruing thereon, except as otherwise
provided in this Trust Agreement.
SECTION 3.
INVESTMENT OF THE FUND
(a) Subject to the provisions of Subsections (b) and (c)
below, the Trustee shall invest the principal and income of the
Fund without distinction between principal and income in
securities or in property, real or personal and wherever
situated, as the Trustee shall deem advisable, in its sole
discretion. Without limiting the foregoing, the Trustee may
purchase, acquire, retain, sell, transfer, pledge or encumber
common or preferred stocks, including stock of the Primary
Sponsor or any affiliate, shares of mutual funds, including
mutual funds for which the Trustee is an advisor, trust and
participation certificates, bonds and mortgages, other evidences
of indebtedness or ownership, annuity contracts and ordinary and
term life insurance contracts of life insurance companies,
savings accounts or plans, including savings accounts or plans
established or to be established by the Trustee, and group trusts
or collective investment funds including group trusts or
collective investment funds operated by the Trustee.
(b) The Fund shall be invested by the Trustee with the
goal of achieving on an annual basis an average rate of return
that equals or exceeds the weighted average of those designated
rates of return to be credited to Accounts for the same period,
as contemplated by Plan Section 4.3 and identified by the Primary
Sponsor from time to time (the "Investment Goal"). The Trustee
shall incur no liability merely for a failure to achieve the
Investment Goal for any period; provided that during the period
the Fund was invested in accordance with applicable fiduciary
standards and with a view towards achieving the Investment Goal.
(c) Prior to the date a Change of Control (as defined in
Section 13(c) hereof) occurs, the Primary Sponsor, and on or
after the date a Change of Control occurs, the Trustee, may
appoint one or more investment managers (the "Investment
Managers") which shall be banks, investment advisers registered
under the Investment Advisers Act of 1940, or insurance
companies, to direct the Trustee as to the investment of all or
a portion of the Fund for the exclusive benefit of the
participants of the Plans and their beneficiaries.
Notwithstanding the foregoing, prior to the date a Change of
Control occurs, the Primary Sponsor may appoint the Trustee (or
any of its affiliates) as an Investment Manager, if it is
otherwise qualified to serve as an Investment Manager and in such
instance, the Trustee shall have discretion over the investment
of the Fund, subject to the provisions of Subsection (b) above.
The Primary Sponsor shall notify the Trustee of the
appointment of any Investment Manager (other than the Trustee)
under this Subsection by delivering to the Trustee (i) an
executed copy of an instrument under which the Investment Manager
was appointed to act hereunder and setting forth the investment
powers of the Investment Manager and (ii) a written instrument
executed by the Investment Manager in which it acknowledges that
it has agreed to act as such. Any notice of appointment pursuant
to this Subsection shall constitute a representation and warranty
by the Primary Sponsor that the Investment Manager is qualified
under and has been appointed in accordance with the provisions
hereof. Notwithstanding anything herein contained to the
contrary, during the term of its appointment, the Investment
Manager shall have the sole responsibility for the investment and
reinvestment of the portion of the Fund for which it was
appointed to act, and, subject to the limitations on the types of
appropriate investments set forth in Subsection (b) hereof, shall
have full power in its discretion to direct the Trustee with
respect to the exercise by it of its investment powers, including
the voting of shares (except as otherwise provided by Section
13(d) hereof). Pending receipt of instructions from any
Investment Manager with respect thereto and subject to any
investment guidelines agreed to in writing from time to time
pursuant to Subsection (b) hereof, any cash received by the
Trustee from time to time shall be invested by the Trustee in
demand and term notes (including those commonly known as "master
notes") maturing not more than three years after the date of
purchase thereof, United States Treasury bills, other government
and agency obligations maturing not more than three years after
the date of purchase thereof, group annuity or other contracts
providing a guaranteed rate of return with a maturity not
exceeding three years, certificates of deposit, commercial paper,
government guaranteed paper, common or collective trust funds,
money market mutual funds, other money market instruments,
savings accounts or other deposits with a financial institution
(including the Trustee, if a financial institution is serving as
such) and part interests in any one or more of the foregoing.
The Primary Sponsor may terminate its appointment of an
Investment Manager at any time and shall in writing notify the
Trustee of such termination, and may thereafter appoint a
successor Investment Manager in the same manner as provided above
in this Subsection. Any successor Investment Manager shall
thereafter, until its appointment is terminated, be deemed to be
an "Investment Manager" for all purposes of this Agreement. If
there shall be more than one Investment Manager, the portion of
the Fund to be invested by each Investment Manager shall be held
in a separate account and the powers and authority of each
Investment Manager shall be divided as set forth in the
instruments appointing such Investment Managers.
So long as an Investment Manager (other than the Trustee or
one of its affiliates) is serving as such, the Trustee shall be
under no duty or obligation to review the assets comprising any
portion of the Fund managed by the Investment Manager, to make
any recommendations with respect to the investment or
reinvestment thereof, or to determine whether any direction
received from any Investment Manager is proper or within the
terms of this Trust Agreement or to monitor the activities of any
Investment Manager.
(d) The Trustee shall have no liability or responsibility
to the Primary Sponsor or any persons claiming any interest in
the Fund for acting without question on the direction of, or for
failing to act in the absence of any direction from, any
Investment Manager unless the Trustee participated knowingly in,
or knowingly undertook to conceal, an act or omission of any
Investment Manager constituting a breach of its duties hereunder,
knowing such act or omission was a breach of such duties;
provided, however, that the Trustee shall not be deemed to have
"participated" in a breach by any Investment Manager for the
purposes of this undertaking solely as a result of the
performance by the Trustee or its officers, employees or agents
of any custodial, reporting, recording, and bookkeeping functions
with respect to any assets of the Fund managed by any Investment
Manager or solely as a result of settling purchase and sale
transactions entered into or directed by any Investment Manager,
or to have "knowledge" of any such breach solely as a result of
the information received by the Trustee or its officers,
employees or agents in the normal course in performing such
functions or settling such transactions. If the Trustee has
actual knowledge of a breach committed by any Investment Manager,
it shall promptly notify the Primary Sponsor in writing thereof,
and the Trustee, except as required by applicable law, shall
thereafter have no responsibility to remedy such breach.
(e) The Primary Sponsor may, prior to a Change of Control,
direct the Trustee in writing to transfer any portion of the Fund
to a subtrustee and to enter into an agreement with the
subtrustee reflecting the subtrust arrangement. In the event of
a Change of Control, the Primary Sponsor may only direct the
Trustee to transfer a portion of the Fund to a subtrustee with
the consent of a majority of the participants of the Plan and the
designated beneficiaries of deceased participants. The Trustee
may terminate a subtrust at any time and direct the subtrustee to
return the portion of the Fund held by the subtrustee; provided
that prior to a Change of Control the subtrust may only be
terminated with the consent of the Primary Sponsor.
SECTION 4.
POWERS OF THE TRUSTEE
In the administration of the Trust, in addition to any
powers or authority of the Trustee under this Trust or which the
Trustee may have under applicable law, the Trustee is authorized
and empowered to do the following, without advertisement, without
order of court and without having to post bond or make any
returns or report of its doings to any court:
(a) To purchase or subscribe for any securities or property
including, without limitation, securities of a Plan Sponsor and
real property leased to or used by a Plan Sponsor;
(b) To sell, exchange, convey, transfer, or otherwise
dispose of any securities or property held by it, by private
contract or at public auction, with or without advertising, and
no person dealing with the Trustee shall be bound to see to the
application of the purchase money or to inquire into the
validity, expediency or propriety of any disposition;
(c) Except as provided in Section 13(d) hereof, to vote any
stocks, bonds or other securities, including securities of the
Plan Sponsor; to give general or special proxies or powers of
attorney with or without power of substitution; to exercise any
conversion privileges, subscription rights or other options, and
to make any payments incidental thereto; to oppose, consent to,
or otherwise participate in corporate reorganizations or other
changes affecting corporate securities, to delegate discretionary
powers, and to pay any assessments or charges in connection
therewith; and generally to exercise any of the powers of an
owner with respect to securities or other property held as part
of the Fund;
(d) To register any investment in its own name or in the
name of a nominee, and to hold any investment in bearer form or
through or by a central clearing corporation maintained by
institutions active in the national securities markets, but the
records of the Trustee shall at all times show that all the
investments are part of the Trust;
(e) To write covered call options and to purchase or sell
put options and financial futures contracts;
(f) To employ and act through suitable agents, accountants,
appraisers, actuaries and attorneys (who may be counsel for the
Trustee) and to pay their reasonable expenses and compensation,
to consult with counsel (who, without limitation, may be counsel
to the Trustee) and shall be protected to the extent the law
permits in acting upon the advice of counsel in regard to legal
questions, and the Trustee shall periodically review the
performance of the persons to whom these duties have been
delegated, but the Trustee shall not be liable for relying upon
the advice and expertise of any such person to the extent
permitted by law, provided the Trustee's decisions in selecting
and retaining such person were prudently made;
(g) To borrow or raise moneys for the purposes of the Trust
in the amounts, and upon the terms and conditions, as the Trustee
in its discretion may deem advisable; and for any sums borrowed
to issue its promissory note as Trustee, and to secure the
repayment thereof by pledging all or any part of the Trust; and
no person lending money to the Trustee shall be bound to see to
the application of the money lent or to inquire into the
validity, expediency or propriety of any borrowing;
(h) To make, execute, acknowledge and deliver any documents
of transfer and conveyance and any other instruments or
agreements that may be necessary or appropriate to carry out the
powers of the Trustee under the Trust or incidental thereto;
(i) To settle, compromise or submit to arbitration any
claims, debts or damages due or owing to or from the Trust, to
commence or defend any suits or legal or administrative
proceedings arising, necessary or appropriate in connection with
the Trust, the administration and operation thereof or the powers
or authority of the Trustee under the Trust, and to represent the
Trust in all suits and legal and administrative proceedings;
(j) To keep portions of the Trust in cash or cash balances
as the Trustee may deem to be in the best interest of the Trust;
(k) To register any investment in its own name or in the
name of a nominee, and to hold any investment in bearer form or
through or by a central clearing corporation maintained by
institutions active in the national securities markets, but the
records of the Trustee shall at all times show that all the
investments are part of the Trust; and
(l) Generally, to do all acts and to execute and deliver
all instruments as in the judgment of the Trustee may be
necessary or desirable to carry out any powers or authority of
the Trustee.
SECTION 5.
FUNDING
(a) Payments to the Trustee by each Plan Sponsor shall be
made as follows:
(i) Contributions shall be paid to the Trustee within
a reasonable period of time after the date that the Deferral
Amounts otherwise would have been paid to Members in an amount
equal to (A) the aggregate Deferral Amounts elected by Members
for the period and (B) corresponding amounts to be credited to
Members' Company Matching Accounts under Plan Section 3.2.
(ii) In the event that the designated rates of return
to be credited to Members' Accounts as of the last Valuation Date
of each Plan Year exceed the aggregate net income, gains and
credits of the Trust as of the same Valuation Date, the Plan
Sponsor shall make a contribution to the Trust within a
reasonable period of time after that Valuation Date in an amount
equal to the excess. In the event that the designated rates of
return and other amounts to be credited to Members' Accounts
pursuant to Plan Section 4.3 as of the last Valuation Date of
each Plan Year are less than the aggregate net income, gains and
credits of the Trust as of the same Valuation Date, the Trustee
shall apply the difference as a credit towards future
contributions required of the Plan Sponsor pursuant to this
Subsection (a), unless the Primary Sponsor directs otherwise
pursuant to Subsection (c) below.
(b) The Trustee shall be responsible for assets actually
received by it as Trustee and shall have no duty or authority to
compute amounts to be contributed or to review the computation of
amounts to be contributed.
(c) Prior to a Change of Control, the Primary Sponsor may
from time to time direct the Trustee to determine the amount by
which the assets in the Trust exceed the amount needed to pay all
unpaid benefits accrued under the Plan (the "Surplus Amount").
If the Trustee determines that the Trust has a Surplus Amount,
the Primary Sponsor may advise the Trustee that the Primary
Sponsor is entitled to receive the Surplus Amount. The Trustee
shall make payment to the Primary Sponsor of the Surplus Amount
as soon as administratively practicable following receipt of the
notification provided for in this Subsection.
SECTION 6.
DUTIES OF THE TRUSTEE
(a) Except for records dealing solely with the Trust and
its investments and disbursements, which shall be maintained by
the Trustee, each Plan Sponsor shall maintain all records
contemplated by the Plan.
(b) Each Plan Sponsor shall furnish to the Trustee all the
information necessary to determine the benefits payable to or
with respect to each participant in the Plan, including any
benefits payable after a participant's death. Each Plan Sponsor
shall from time to time, and at least annually, and promptly upon
the request of the Trustee furnish updated information to the
Trustee. In the event the Plan Sponsor refuses or neglects to
provide any updated information as contemplated herein, the
Trustee shall rely upon the most recent information furnished to
it by the Plan Sponsor; provided, however, that on or after a
Change of Control, the Trustee shall rely in its discretion upon
(i) information furnished to it by the Plan Sponsor prior to a
Change of Control, (ii) information furnished to it by the Plan
Sponsor on or after a Change of Control and/or (iii) any
information received by it from a participant or designated
beneficiary unless the recipient actually knows that any such
information is false. The Trustee has no responsibility to
verify information provided to them by the Plan Sponsor or any
participant or designated beneficiary.
(c) Upon proper notification from the Plan Sponsor prior to
a Change of Control or upon an independent determination by the
Trustee on or after a Change of Control (based on such
information as the Trustee shall be entitled to rely upon
pursuant to Subsection (b) above), when, in the opinion of the
Plan Sponsor prior to a Change of Control or Trustee on or after
a Change of Control, as applicable, a participant's benefits
under the Plan have become payable, the Plan Sponsor or Trustee,
as applicable, shall notify the participant or the beneficiary of
a deceased participant and, if applicable, the Trustee. Such
notice shall include the amount of such benefits, the terms of
payment, the amount of any taxes required to be withheld from
such amount, and the name, address and social security number of
the recipient. Upon the receipt of a notification or after
making its determination, as applicable, the Trustee shall
commence distributions from the Fund in accordance therewith to
the person or persons so indicated.
(d) The Plan Sponsors shall have full responsibility for
the payment of all taxes of any nature levied, assessed or
imposed upon the Fund, including the payment of all withholding
taxes to the appropriate taxing authority and shall also furnish
each participant or beneficiary with the appropriate tax
information form evidencing such payment and the amount thereof.
(e) Prior to a Change of Control, the Trustee shall have no
responsibility for determining whether any participant or
beneficiary has died or whether a participant's rights under the
terms of the Plan have been forfeited and shall be entitled to
rely upon information furnished by the Plan Sponsor. On or after
a Change of Control, the Trustee shall determine whether a
participant's benefit shall be deemed forfeited or whether a
participant or beneficiary has died based on information supplied
under Subsection (b) hereof; provided, however, that a certified
death certificate received by the Trustee shall be conclusive
evidence of the death of any person regardless of the source of
such certificate.
(f) Nothing provided in this Trust Agreement shall relieve
a Plan Sponsor of its liabilities to pay the benefits provided
under the Plan except to the extent such liabilities are met by
application of Fund assets.
(g) Each Plan Sponsor agrees that by the establishment of
this Trust it hereby forgoes forgoes any judicial review of any
independent determination by the Trustee as to the benefit
payable to any persons hereunder. If a dispute arises as to the
amounts or timing of any such benefits or the persons entitled
thereto under the Plans or this Trust Agreement, the Plan Sponsor
agrees that such dispute shall be resolved by binding arbitration
proceedings convened in Mobile, Alabama and conducted in
accordance with the rules of the American Arbitration Association
and that the results of such proceedings shall be conclusive and
shall not be subject to judicial review. It is expressly
understood that pending the resolution of any such dispute,
payment of benefits shall be made and continued by the Trustee in
accordance with its independent determination and that the
Trustee shall have no liability with respect to such payments.
The Plan Sponsor also agrees to pay the entire cost of any
arbitration or legal proceeding initiated by it or by the Trustee
or by any participant or beneficiary, including the legal fees of
the Trustee and the participant or other claimant regardless of
the outcome of any such proceeding.
SECTION 7.
DISTRIBUTIONS FROM THE FUND
(a) Consistent with the provisions of Section 9 hereof, the
Trustee is authorized to pay from the Fund reasonable expenses of
the Trustee, including fees of accountants and legal counsel to
the Trust, and the Trustee's compensation.
(b) The Trustee shall make any distribution required
pursuant to this Trust Agreement by mailing its check or other
evidence of payment to the person to whom such distribution or
payment is to be made at such address as was last furnished to
the Trustee or, if agreeable to the Plan Sponsor and the affected
participant and so directed in a written notice to the Trustee by
those parties, by crediting the account of such person or by
transferring funds to such person's account by bank or wire
transfer. The Trustee shall not be required to make any
investigation to determine the whereabouts or mailing address of
any person. If the person to receive a distribution can not be
found, the Trustee shall hold payment or deposit same in a bank
(including the Trustee, if a financial institution is serving as
such) for the credit of that person without liability for
interest thereon. If a check or other evidence of payment of the
benefit hereunder has been mailed to the last address of the
person furnished the Trustee and is returned unclaimed, the
Trustee shall notify the Plan Sponsor and shall discontinue
further payments to the payee until it receives instructions from
the Plan Sponsor.
(c) The Trustee shall not be bound by any instruction,
direction or notice unless and until it has been received in
writing by the Trustee and may rely upon any instruction,
direction or notice of a continuing nature until the Trustee
receives a writing which revokes that instruction, direction or
notice. The Trustee may without liability assume that any such
instruction, direction or notice is genuine unless it has actual
knowledge or, after receiving notification of a problem, has
reasonably determined that the instruction, direction or notice
is not genuine.
(d) The Trustee shall not be responsible for the
application of any assets held as part of the Fund which have
been distributed pursuant to the Plan and the Trust Agreement.
SECTION 8.
CLAIMS OF CREDITORS
(a) The Fund assets shall be treated as general assets of
the Plan Sponsor and shall remain subject to claims of the
general creditors of the Plan Sponsor under applicable state and
federal law. Nothing in the Trust Agreement shall affect the
rights of any participant as general creditor of the Plan
Sponsor. No participant shall have a preferred claim on or any
beneficial ownership in the Fund prior to the time for
distribution to the participant under the terms of a Plan or the
terms of this Trust Agreement. In the event that the Plan
Sponsor becomes insolvent as described in Subsection (c) below,
each participant shall be deemed to waive any priority the
participant may have under law as an employee with respect to any
claim against the Plan Sponsor and the Trust beyond the rights
the participant would have as a general creditor of the Plan
Sponsor.
(b) Except as otherwise provided by Subsection (c) below,
no benefit which shall be payable under the Trust to any person
shall be subject in any manner to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance or charge, and any
attempt to anticipate, alienate, sell, transfer, assign, pledge,
encumber, charge or otherwise dispose of the same shall be void.
No benefit shall in any manner be subject to the debts,
contracts, liabilities, engagements or torts of any person, nor
shall it be subject to attachment or legal process for or against
any person, except to the extent provided by Subsection (c) below
and as may otherwise be required by law.
(c) The board of directors of a Plan Sponsor shall
immediately notify the Trustee in writing of the insolvency of
the Plan Sponsor. For purposes of this Subsection (c), the term
"insolvency" shall mean the inability of the Plan Sponsor to pay
its debts as they become due in the usual course of its business
or that the liabilities of the Plan Sponsor are in excess of its
assets. Upon receipt of the written notice, the Trustee shall
suspend all further payments to participants or their
beneficiaries and shall hold the assets of the Trust for the
benefit of the creditors of the Plan Sponsor in the manner
directed by a court of competent jurisdiction. If the Trustee
should receive any written allegation of the insolvency of the
Plan Sponsor, the Trustee shall suspend payments to participants
and hold the assets of the Trust for the benefit of the creditors
of the Plan Sponsor and, within a period of thirty (30) days
after the receipt of the written allegation, determine whether
the Plan Sponsor is insolvent. If the Trustee determines that
the Plan Sponsor is solvent, it shall immediately resume payments
to the participants or their beneficiaries. In the event that
the Trustee has actual knowledge of the insolvency of the Plan
Sponsor, the Trustee shall hold the assets of the Trust for the
benefit of the creditors of the Plan Sponsor in the manner
directed by a court of competent jurisdiction. Unless the
Trustee (i) has been notified in writing by the board of
directors of a Plan Sponsor of the insolvency of a Plan Sponsor,
(ii) has received any written allegation of the insolvency of a
Plan Sponsor or (iii) has actual knowledge of the insolvency of
a Plan Sponsor, the Trustee shall have no duty to inquire whether
a Plan Sponsor is insolvent.
SECTION 9.
FEES AND EXPENSES
The compensation and expenses of the Trustee shall be paid
from the assets of the Fund. Expenses of the Trustee shall
include the reasonable expenses and compensation of third parties
employed by the Trustee pursuant to Section 4(f) hereof.
SECTION 10.
ACCOUNTS
(a) The Trustee shall keep such records as the Trustee
considers necessary for the management of the Trust. The
Trustee's books and records of the Fund shall be open to
inspection by the Plan Sponsor and participants during regular
business hours of the Trustee.
(b) The Trustee may establish separate accounts within the
Fund for any group or category of the Plan as it determines
appropriate to maintain its books of accounts and other records
in accordance with the provisions of the Plan and the Trust
Agreement. The Plan Sponsors shall maintain or cause to be
maintained accounting records for the Plan sufficient to allow
the determination of the portion of the Fund which is allocable
both to each of the Plan Sponsors. Irrespective of the
comingling of assets of the Plan for investment in the Fund, no
portion of the Fund which is allocable to any one of the Plan
Sponsors shall be used to pay benefits or discharge liabilities
or obligations specifically allocable or attributable,
respectively, to any other Plan or any other Plan Sponsor.
(c) Within ninety (90) days after the close of each
calendar year, the date of the removal or resignation of the
Trustee, or the termination of the Trust, the Trustee shall
render to the Primary Sponsor a written account of its management
of the Fund covering the period since the previous account and
report. The written approval of that accounting and report by
the Primary Sponsor or the failure of the Primary Sponsor to
notify the Trustee of its disapproval of such accounting within
ninety (90) days after its receipt shall be final and binding as
to the Trustee's administration of the Trust for the period upon
the Primary Sponsor and all persons who have or may thereafter
have an interest in the Trust.
SECTION 11.
RESIGNATION, REMOVAL AND SUCCESSION
(a) The Trustee may resign at any time upon giving sixty
(60) days' prior written notice to the Primary Sponsor.
(b) The Trustee may be removed by the Primary Sponsor at
any time; provided, however, that in the event of a Change of
Control, the Trustee may thereafter be removed only after
securing the written consent of a majority of the participants of
the Plan and the designated beneficiaries of deceased
participants.
(c) Upon the removal or resignation of the Trustee, any
successor appointed shall have the same powers and duties as
those conferred upon the Trustee under this Trust. Prior to a
Change of Control, the appointment of any successor Trustee shall
be in the sole discretion of the Primary Sponsor. On or after a
Change of Control, the appointment of any successor Trustee shall
be made only with the consent of a majority of the participants
of the Plans and the designated beneficiaries of deceased
participants. Upon receipt by the Trustee of a written
acceptance of the appointment by the successor Trustee, the
Trustee shall transfer to the successor Trustee the assets
constituting the Trust; provided, however, the Trustee shall not
be required to pay over assets to a successor Trustee unless the
Trustee shall be discharged from all liability for any taxes
which may be due and owing by the Trust, or unless the successor
Trustee, who must be acceptable to the Trustee, indemnifies the
Trustee and the Trustee in its sole discretion agrees to accept
indemnification. In the event that within ninety (90) days after
the removal or resignation of the Trustee the Primary Sponsor
shall have failed to appoint a successor Trustee or the Trustee
shall not have received a written acceptance from a successor
Trustee, then the Trustee may file an appropriate action in a
court of competent jurisdiction and transfer to the custody of
the court the assets then held by the Trustee constituting the
Trust. Upon transfer to a successor Trustee or to the court, as
the case may be, the Trustee shall be relieved of all further
responsibilities and liabilities in connection with the Trust.
The Trustee is authorized, however, to reserve therefrom any
assets as it may deem advisable for payment of its fees and
expenses in connection with the settlement of its account or
otherwise, and any balance of the reserve remaining after the
payment of the Trustee's fees and expenses shall be paid over to
the successor Trustee or to the court.
SECTION 12.
AMENDMENT AND TERMINATION
(a) Prior to a Change of Control, the Trust Agreement may
be amended any time and to any extent by a written instrument
executed by the Primary Sponsor, provided, however, that no such
amendment shall be effective to the extent that it purports to
make the Trust revocable. In addition, no such amendment shall
have the effect of reducing benefits accrued by participants
under the Plan, delaying the times at which distributions are
made from the Fund to participants and their beneficiaries or
allowing a Plan Sponsor or any other person to receive
distributions of the assets of the Fund not then permitted under
the terms of the Trust Agreement. On or after a Change of
Control, this Trust Agreement may only be amended with the
consent of a majority of the participants of the Plan and the
designated beneficiaries of deceased participants. No amendment
that purports to increase the duties or responsibilities of the
Trustee or to alter materially the manner in which the Trustee is
to discharge any continuing duties or responsibilities shall be
given effect without the consent of the Trustee and no other
amendment shall be given effect without first providing notice of
same to the Trustee. The Trustee and Primary Sponsor or, if
applicable, a majority of the participants of the Plan and the
designated beneficiaries of deceased participants may amend the
Trust Agreement in any manner not otherwise specifically
precluded by this Subsection, including any amendment regarding
the removal of an existing Trustee or the appointment of a
successor Trustee.
(b) Notwithstanding any other provisions of the Trust
Agreement to the contrary, the Trust shall terminate and all Fund
assets shall be distributed (i) on the complete distribution of
the Fund in accordance with the terms and provisions of the Plan;
(ii) upon the delivery to the Trustee of a writing terminating
the Trust signed by the Primary Sponsor, all participants of the
Plan and the designated beneficiaries of deceased participants;
or (iii) in the event the Internal Revenue Service makes a final
determination that the assets of the Fund constitute compensation
currently taxable as income to participants. Any assets
remaining in the Fund after satisfaction of all liabilities and
expenses of the Plan shall be returned to the Plan Sponsors.
SECTION 13.
MISCELLANEOUS
(a) The Trustee shall under no circumstances be required to
recognize any conveyance, transfer, assignment, mortgage, pledge
or encumbrance by any participant or any person entitled to
receive benefits under the Plan, any part of it, or any interest
in it, or to pay any money or thing of value to any creditor or
assignee of any participant or person for any cause whatsoever;
provided, however, this Subsection (a) does not affect the
provisions of Section 8 of the Trust Agreement.
(b) The Primary Sponsor hereby agrees to indemnify and hold
harmless the Trustee from and against any and all losses, claims,
damages, liabilities, costs and expenses, including but not
limited to, liability for any judgments or settlements consented
to in writing by the Trustee, as applicable, which consents will
not be unreasonably withheld, and reasonable attorneys' fees
arising out of or in connection with or as a direct or indirect
result of its serving, respectively, as the trustee (including
but not limited to the Trustee's acts or omissions with respect
to (i) the voting of any share of stock held as part of the
assets of the Trust; (ii) establishing or maintaining investment
funds or effecting investments therein in accordance with the
terms and provisions of the Trust; (iii) the determinations by
the Trustee of insolvency or of a Change of Control (including
acts or omissions in accordance with the terms and provisions of
the Trust following any determination of insolvency or a Change
of Control); or (iv) the determination by the Trustee of Surplus
Amounts or benefits payable to participants or their
beneficiaries), except those losses, claims, damages,
liabilities, costs and expenses, if any, arising out of or in
connection with or as a direct or indirect result of the
Trustee's bad faith, gross negligence or willful neglect or
breach of trust. In amplification of and without limiting the
foregoing, the Primary Sponsor specifically agrees to indemnify
and hold the Trustee harmless from and against any and all
liability, loss, damage, cost or expense arising out of or in
connection with (A) the transfer of any portion of the Fund to a
subtrustee at the direction of the Primary Sponsor; (B) any act
or omission of a subtrustee, provided the Trustee had no
knowledge of such act or omission acquired through its normal
course of dealings with the subtrustee, or if the Trustee did
have such knowledge either the Trustee timely notified the
Primary Sponsor in writing or the Primary Sponsor otherwise
received timely notice of such act or omission; or (C) any
decision by the Trustee to terminate a subtrust following a
Change of Control. Nothing in the immediately preceding sentence
shall require the Primary Sponsor to indemnify and hold the
Trustee harmless from and against any liability, loss, damage,
cost or expense attributable to regulatory action taken by any
Federal or state agency having jurisdiction over the Trustee, as
a banking institution, with regard to the establishment or
maintenance of a subtrust. The Trustee shall promptly notify the
Primary Sponsor of any claim, action or proceeding for which it
may seek indemnity. This indemnity is a continuing obligation
and shall be binding on the Primary Sponsor and its successors,
whether by merger or otherwise, and assigns. In addition, this
indemnity shall survive the resignation or removal of the
Trustee, the liquidation of the Trust, or both events.
(c) As used in this Trust Agreement, the term "Change of
Control" means any event that pursuant to the requirements of
Article X of the Primary Sponsor's Certificate of Incorporation,
as amended from time to time, requires the affirmative vote of
the holders of not less than eighty percent (80%) of the Voting
Stock (as defined therein); provided, however, that no event
shall constitute a Change of Control if approved by the Board of
Directors of the Primary Sponsor a majority of whom are "present
directors" and "new directors." For purposes of the preceding
sentence, "present directors" shall mean individuals who as of
the date of this Trust Agreement were members of the Board of
Directors of the Primary Sponsor and "new directors" shall mean
any director whose election by the Board of Directors of the
Primary Sponsor (in the event of vacancy) or whose nomination for
election by the Primary Sponsor's stockholders was approved by a
vote of at least three-fourths of the directors then still in
office who are present directors and new directors; provided that
any director elected to the Board of Directors of the Primary
Sponsor solely to settle a threatened or actual proxy contest
shall in no event be deemed to be a new director. The board of
directors of the Primary Sponsor shall immediately notify the
Trustee of the occurrence of a Change of Control. Upon receipt
of such written notice or in the event the Trustee has actual
knowledge that a Change of Control has occurred, the Trustee
shall take no action nor facilitate the taking of any action
contemplated by the Trust Agreement as being taken prior to a
Change of Control if (i) an alternative procedure for taking such
action is prescribed on or after a Change of Control, or (ii) any
action of the type described is expressly limited to the period
prior to a Change of Control. If the Trustee should receive any
written allegation to the effect that a Change of Control has
occurred, the Trustee shall take no action nor facilitate the
taking of any action described in the immediately preceding
sentence until making an independent determination as to whether
a Change of Control has occurred. The Trustee shall make this
determination within a period of thirty (30) days after the
receipt of the written allegation. Following the determination,
the Trustee shall discharge its duties under the Trust Agreement
in a manner consistent with that determination.
(d) Prior to a Change of Control, authority and
responsibility with regard to the voting of and control over any
securities of a Plan Sponsor held in the Trust shall be exercised
as follows: (i) the Primary Sponsor shall direct the Trustee in
writing as to the manner in which such securities are to be
voted; and (ii) all other decisions affecting such securities,
including, without limitation, decisions to oppose or consent to
tender or exchange offers, shall be similarly directed by the
Primary Sponsor. The Trustee shall take such steps as may be
necessary or appropriate to carry out the directions of the
Primary Sponsor given pursuant to this Subsection. On or after
a Change of Control, voting and all other decisions relating to
the securities of a Plan Sponsor shall be made by the Trustee or,
if such securities are subject to the investment authority of an
Investment Manager by that Investment Manager.
(e) The Trustee shall be required to take any and all
reasonable legal action to enforce the obligations of each Plan
Sponsor under the Trust Agreement.
(f) Whenever the context requires, words of the masculine
gender used herein shall include the feminine and the neuter, and
the words used in the singular shall include the plural.
(g) Each provision of the Trust Agreement is severable and
if any provision is found to be void as against public policy it
shall not affect the validity of any other provision hereof.
(h) The Trust Agreement shall be binding upon the
successors and assigns of each Plan Sponsor and the Trustee.
(i) The provisions of the Trust shall be construed
according to the laws of the State of Alabama and, to the extent
applicable, according to the laws of the United States.
IN WITNESS WHEREOF, the parties have hereunto set their
hands and seals the day and year first above written.
PRIMARY SPONSOR:
Morrison Restaurants Inc.
By: /s/ Samuel E. Beall, III
Title: President and Chief
Executive Officer
ATTEST:
/s/ Pfilip G. Hunt
Title: Senior Vice President,
General Counsel & Secretary
[CORPORATE SEAL]
TRUSTEE:
AmSouth Bank N.A.
By: /s/ Lynn E. Cushing
Title: Vice President and Trust
Officer
ATTEST:
/s/ Cheryl A. Davidson
Title: Vice President and Trust
Officer
[SEAL]
MORRISON INCORPORATED
MANAGEMENT RETIREMENT PLAN
THIS INDENTURE made and entered into this 28th day of March , 1989,
by MORRISON INCORPORATED, a corporation organized and existing under the laws
of the State of Delaware (hereinafter referred to as the "Company"):
W I T N E S S E T H:
WHEREAS, the Company established the Morrison Incorporated Management
Retirement Plan (the "Plan"), effective June 1, 1989; and
WHEREAS, the Company desires to provide for a select group of management
or highly compensated long-term employees the security of receiving a defined
level of retirement benefits from the Plan, when considered together with
benefits provided from the Company-funded portion of certain other employee
benefits provided by the Company;
NOW, THEREFORE, effective as of June 1, 1989, the Company hereby agrees
to provide certain benefits in accordance with the following terms and
conditions:
ARTICLE I
DEFINITIONS
1.01 "Accrued Benefit" means the benefit payable to a Participant in
accordance with Article IV hereof as a yearly amount, calculated as a single
life annuity for the life of the Participant, equal to 1.5 percent of the
Participant's Final Average Compensation multiplied by the number of Years of
Credited Service not to exceed 20, plus 2 percent of the Participant's Final
Average Compensation multiplied by each additional Year of Credited Service
in excess of 20 but not to exceed 30, minus the sum of (a) the Participant's
Frozen Retirement Plan Benefit, (b) the Participant's Social Security Benefits
and (c) the Participant's Executive Supplemental Pension Plan Benefit.
1.02 "Actuarial Equivalent" means, with respect to a benefit, any
benefit provided under the terms of the Plan which has the same present value
on the date the benefit payment commences. For the purpose of establishing
whether a benefit is the Actuarial Equivalent of another benefit, the Company
shall apply the same factors for determining actuarial equivalence under the
Frozen Retirement Plan.
1.03 "Affiliate" means (a) any corporation which is a member of the
same controlled group of corporations (within the meaning of Section 414(b)
of the Code) as is the Company, (b) any other trade or business (whether or
not incorporated) controlling, controlled by, or under common control (within
the meaning of Section 414(c) of the Code) with the Company, (c) any other
organization which is a member of an affiliated service group (within the
meaning of Section 414(m) of the Code) with the Company, and (d) any other
entity required to be aggregated with the Company pursuant to regulations
under Section 414(o) of the Code.
1.04 "Board of Directors" means the Board of Directors of the
Company.
1.05 "Break in Service" means any Plan Year during which a
Participant has not completed more than 500 Hours of Service. A Break in
Service shall not occur during:
(a) an absence or leave of absence, with or without pay,
which was authorized by the Company for a period not to exceed one year
provided that the Participant returns to the active service of the
Company at or prior to the termination of the absence or leave;
(b) periods of military service during which time the
Participant's rights were protected by law; or
(c) maternity or paternity leave of absence caused:
(1) by reason of pregnancy of the individual,
(2) by reason of the birth of a child of the Participant,
(3) by reason of the placement of a child in connection
with the adoption of a child by the Participant, or
(4) for purposes of caring for the child during the
period immediately following the birth or placement for
adoption.
In the case of (c) above, the Participant shall be considered as having
completed either the number of hours that would have been credited to the
Participant for the absence or, if the normal working hours are unknown, he
shall be credited with eight hours per normal work day during the absence.
However, the total number of hours so credited shall not exceed 501 and
further must be credited only (i) in the year in which that absence begins for
one of the permitted reasons listed herein if the crediting is necessary to
prevent a Break in Service in that year or (ii) in the following year.
1.06 "Code" means the Internal Revenue Code of 1986, as amended.
1.07 "Compensation" means the total compensation that would be
subject to tax under Code Section 3101(a) (but without the dollar limitation
of Code Section 3121(a)(1) and excluding any amounts paid as Long-Term
Disability Benefits) paid to a Participant by the Company, or any Affiliate,
during a Plan Year, including amounts paid or credited to a Participant as
nonqualified deferred compensation by the Company or any Affiliate,
notwithstanding the provisions of Code Section 3121(v)(2), but in no event in
excess of $100,000 (as adjusted from time to time at the sole discretion of
the Company).
1.08 "Deferred Retirement Date" means the date on which a Participant
actually retires under the provisions of Section 4.03 of the Plan.
1.09 "Early Retirement Date" means the date on which a Participant
attains age 55, completes at least 15 Years of Credited Service, and submits
in writing a request to retire on a date prior to his Normal Retirement Date.
1.10 "Executive Supplemental Pension Plan Benefit" means the benefits
under the Morrison, Inc. Executive Supplemental Pension Plan payable to a
Participant or his beneficiary designated under such Plan and calculated as
a single life annuity for the life of the Participant.
1.11 "Final Average Compensation" means the average of a
Participant's Compensation for the five consecutive Years of Credited Service
immediately preceding his retirement date or death. If a Participant
completes at least 1,000 Hours of Service in a Year of Credited Service within
the computation period, but he is not paid compensation for that entire Plan
Year, then his Compensation for that Year of Credited Service shall be
annualized. For the purpose of annualizing a Participant's Compensation, the
component consisting of bonuses shall be the greater of the bonuses paid to
the Participant during the Plan Year or the bonuses paid to the Participant
in the most recent Plan Year.
1.12 "Frozen Retirement Plan" means the Morrison Incorporated
Retirement Plan.
1.13 "Frozen Retirement Plan Benefit" means the benefits under the
Morrison Incorporated Retirement Plan payable to a Participant or his
beneficiary designated under such Plan and calculated as a single life annuity
for the life of the Participant.
1.14 "Hour of Service" means
(a) Each hour for which an Participant is paid or entitled
to payment for the performance of duties for the Company or an
Affiliate. These hours shall be credited to the Participant for the
computation period in which the duties are performed.
(b) Each hour for which an Participant is paid or entitled
to payment by the Company or an Affiliate on account of a period of time
during which no duties are performed (irrespective of whether the
employment relationship has terminated) due to vacation, holiday,
illness, incapacity (including disability), layoff, jury duty, military
duty or leave of absence. No more than 501 Hours of Service shall be
credited under this Subsection for any single computation period.
(c) Each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to by the Company or
an Affiliate. The same Hours of Service shall not be credited under
both Subsection (a) or Subsection (b), as the case may be, and also
under this Subsection (c). These hours shall be credited to the
Participant for the computation period or periods in which the award,
agreement, or payment pertains.
(d) Hours of Service shall be credited and determined in
compliance with Section 2530.200b-2 of 29 CFR Part 2530 as prescribed
by the Department of Labor.
1.15 "Long-Term Disability Benefits" mean the annual benefits payable
to a Participant by reason of any long-term disability coverage attributable
to premiums paid by the Company or an Affiliate.
1.16 "Normal Retirement Age" means the date on which a Participant
attains age 65.
1.17 "Normal Retirement Date" means the date on which a Participant
attains Normal Retirement Age.
1.18 "Participant" means any employee of the Company who has become
a Participant pursuant to Article II of the Plan, who retires from employment
with the Company on or after June 1, 1989, and who has not received a full
distribution from the Plan of his Accrued Benefit.
1.19 "Plan Administrator" means the organization, person or persons
appointed by the Board of Directors.
1.20 "Plan Year" means the calendar year.
1.21 "Social Security Benefits" means (a) if the Participant retires
prior to his Normal Retirement Date, the annual primary insurance amount that
would be payable to a Participant at "retirement age" as defined in 42 U.S.C.
Section 416(1) under the Social Security Act, as amended, based on the
assumption that the Participant will continue to receive until reaching
"retirement age" Compensation that would be treated as wages for purposes of
the Social Security Act at the same rate as in the calendar year preceding the
retirement date; or (b) if the Participant retires on or after his Normal
Retirement Date, the annual primary insurance amount payable to a Participant
at "retirement age" as defined in 42 U.S.C. Section 416(1) under the Social
Security Act, as amended.
1.22 "Year of Credited Service" means each calendar year during which
the Participant completes not less than 1,000 Hours of Service. For purposes
of determining Years of Credited Service, the following shall apply: (a) in
the event that the Company or an Affiliate acquires all of the assets of
another corporation or entity or a controlling interest in the stock of
another corporation or merges with another corporation or entity and is the
surviving entity, then an employee who was employed by the prior corporation
or entity and who is employed by the Company or an Affiliate on or about the
time of the acquisition or merger may be credited, at the sole discretion of
the Company, with Years of Credited Service while in the employ of the prior
corporation or entity but for that period shall be credited with no more than
seven and one-half (7-1/2) Years of Credited Service; (b) if a Participant
makes the election under Section 4.04(b) hereof to defer payment of his
Accrued Benefit upon attaining his Early Retirement Date, his Accrued Benefit
shall be determined by crediting him with an additional Year of Credited
Service for each whole calendar year constituting the period of deferral;
(c) if a Participant receives Long-Term Disability Benefits for any period of
time, that period shall not be counted for purposes of determining Years of
Credited Service; (d) in the event a Participant incurs a Break in Service of
more than three consecutive Plan Years, all Years of Credited Service prior
to the initial Break in Service shall be disregarded for all purposes under
the Plan; and (e) in the event a Participant incurs a Break in Service for a
period not in excess of three consecutive Plan Years, the Plan Administrator
shall have the sole discretion to determine how many, if any, Years of
Credited Service prior to the initial Break in Service shall be counted and
for which purposes under the Plan.
ARTICLE II
ELIGIBILITY
2.01 Any person actively employed by the Company or an Affiliate who,
as of June 1, 1989, had 15 Years of Credited Service and whose average annual
Compensation (determined without regard to the $100,000 limit) for the
immediately preceding three-calendar-year period equalled or exceeded $40,000
shall be a Participant as of June 1, 1989.
2.02 Any other person actively employed by the Company or an
Affiliate with 15 Years of Credited Service and whose average annual
Compensation (determined without regard to the $100,000 limit) for a
consecutive three-calendar-year period equals or exceeds $40,000 (as may be
adjusted from time to time hereafter by the Company) shall become a
Participant in the Plan as of the immediately succeeding January 1st.
ARTICLE III
FUNDING
The Plan shall be unfunded and all benefits payable under the Plan shall
be paid solely out of the Company's assets which are available to satisfy the
claims of the Company's general creditors.
ARTICLE IV
RETIREMENT BENEFITS
4.01 Whenever in the Plan reference is made to a retirement date, it
shall mean the Normal Retirement Date, Deferred Retirement Date, or Early
Retirement Date, whichever is applicable. If the amount of the payment
required to commence on a specified date pursuant to this Article IV cannot
be made or ascertained by that date, payment shall commence retroactively to
that date.
4.02 Normal Retirement Date
A Participant who reaches Normal Retirement Age while an employee of the
Company or an Affiliate may retire as of his Normal Retirement Date and shall
be entitled to receive his Accrued Benefit. However, a Participant who is
also a participant in the Frozen Retirement Plan can only receive his Accrued
Benefit if he has begun to receive his Frozen Retirement Plan Benefit. The
benefit under this Section 4.02 shall commence on the first day of the month
following the Participant's Normal Retirement Date and shall be payable in
accordance with Article VII hereof.
4.03 Deferred Retirement
A Participant may elect to remain in the employ of the Company or an
Affiliate beyond his Normal Retirement Date and defer receipt of his benefit
under the Plan until his Deferred Retirement Date. However, a Participant who
is also a participant in the Frozen Retirement Plan can only receive his
Accrued Benefit if he has begun to receive his Frozen Retirement Plan Benefit.
The benefit commencing upon the Participant's actual retirement date will be
his Accrued Benefit calculated as of his Deferred Retirement Date. The
benefit under this Section 4.03 shall commence on the first day of the month
following the Participant's Deferred Retirement Date and shall be payable in
accordance with Article VII hereof.
4.04 Early Retirement
(a) At his Early Retirement Date, a Participant may retire under
this Section 4.04(a) and shall be entitled to receive his Accrued Benefit
calculated as of his Early Retirement Date. However, a Participant who is also
a participant in the Frozen Retirement Plan can only receive his Accrued
Benefit if he has begun to receive his Frozen Retirement Plan Benefit. Except
as provided in Subsection (b) below, the benefit under this Section 4.04 shall
commence on the first day of the month following the Participant's Early
Retirement Date in accordance with Article VII hereof.
(b) At his Early Retirement Date, a Participant may elect to retire
but may request of the Plan Administrator permission to defer the commencement
of the payment of his Accrued Benefit to any point in time beginning at least
12 months after his Early Retirement Date. If a Participant so elects and he
receives the permission of the Plan Administrator, his Accrued Benefit
nevertheless shall be determined based upon his Final Average Compensation as
of his Early Retirement Date although he shall continue to accrue Years of
Credited Service as provided in Section 1.22(b) hereof.
ARTICLE V
DEATH BENEFITS
Upon the death of any married Participant on or after his Early
Retirement Date but prior to the receipt of any benefits hereunder, the spouse
surviving him on the date of death shall be entitled to receive a survivor
annuity providing monthly benefits for life equal to fifty (50) percent of the
annuity which would have been payable during the joint lives of the
Participant and such surviving spouse if the Participant had retired on the
date immediately before his death and received a normal form of distribution
pursuant to Section 7.02 hereof. The benefit shall be paid to such surviving
spouse on the first day of the month following the Participant's death in
accordance with Article VII hereof. If the amount of the payment required to
commence on a specified date pursuant to this Article V cannot be made or
ascertained by that date, payment shall commence retroactively to that date.
ARTICLE VI
TERMINATION OF EMPLOYMENT
6.01 Termination of Employment
In the event a Participant's employment with the Company and its
Affiliates terminates before his Early Retirement Date, his Accrued Benefit
shall be forfeited.
6.02 Leave of Absence
A leave of absence which is authorized by the Company shall not
constitute a termination of employment unless the Participant fails to return
to active employment at or prior to the expiration of the leave. If the
Participant does not return to active employment within the time specified,
then his employment shall be deemed to have terminated as of the commencement
of the leave of absence.
ARTICLE VII
PAYMENT OF BENEFITS UPON RETIREMENT
7.01 All forms of retirement benefits payable under the Plan shall
be the Actuarial Equivalent of the Participant's Accrued Benefit payable as
a single life annuity for the life of the Participant.
7.02 In the case of a Participant who is ineligible to receive
benefits under the Frozen Retirement Plan, the normal form of distribution
made pursuant to this Section 7.02 if the Participant is married on the date
benefits are to commence shall be a joint and fifty (50) percent survivor
annuity providing monthly benefits payable for the life of the Participant
with a survivor annuity for the life of the spouse to whom he is married at
retirement which is fifty (50) percent of the amount of the annuity payable
during the joint lives of the Participant and such surviving spouse, or if the
Participant is not married on the date benefits are to commence, a single life
annuity providing monthly benefits payable for the life of the Participant.
No later than 90 days and no earlier than 120 days prior to his retirement
date, the Participant may request of the Plan Administrator permission to have
payments made in one of the following alternative forms:
(a) an annuity providing for monthly benefits payable for
the life of the Participant;
(b) an annuity providing for monthly benefits payable for
the life of the Participant with 120 or 240 monthly payments guaranteed;
(c) a joint and survivor annuity providing for monthly
benefits payable for the life of the Participant with a survivor annuity
for the life of his joint annuitant designated at retirement (either his
surviving spouse or another designee) at the rate of fifty (50),
seventy-five (75) or one hundred (100) percent of the amount of the
annuity payable during the joint lives of the Participant and such joint
annuitant.
7.03 If a Participant is eligible to receive benefits under the
Frozen Retirement Plan, his Accrued Benefit shall be paid in the same form as
the method of payment selected by the Participant under the Frozen Retirement
Plan.
7.04 No payments of a Participant's Accrued Benefit shall be made
while the Participant is receiving Long-Term Disability Benefits.
ARTICLE VIII
PLAN ADMINISTRATOR
8.01 Organization and Operation of a Plan Administrator
(a) Any person appointed as the Plan Administrator shall
signify his acceptance by filing a written acceptance with the Board of
Directors. If a corporation or organization is appointed to serve as
the Plan Administrator, then the Plan Administrator may designate in
writing a person who may act on behalf of the Plan Administrator. The
Board of Directors shall have the right to remove the Plan Administrator
at any time by notice in writing. The Plan Administrator may resign at
any time by written notice of resignation to the Board of Directors,
which resignation shall become effective upon the date specified
therein. Upon removal or resignation, or in the event of the death of
a person constituting any part of the Plan Administrator, the Board of
Directors shall appoint a successor to the person.
(b) The Plan Administrator shall not receive any
compensation for his services.
8.02 Duties and Responsibilities of the Plan Administrator
(a) The Plan Administrator shall perform any act which the
Plan authorizes or requires of the Plan Administrator.
(b) The Plan Administrator shall compute the amount of any
benefits which shall be payable to any Participant or beneficiary in
accordance with the provisions of the Plan.
(c) The Plan Administrator shall from time to time
establish rules, not contrary to the provisions of this Plan, for the
administration of the Plan and the transaction of its business. The
Plan Administrator shall interpret the Plan and shall determine all
questions arising in the administration, interpretation and application
of the Plan, including determinations of eligibility for, and the amount
of, any Accrued Benefit. All determinations of the Plan Administrator
shall be final and binding on all Participants and beneficiaries,
subject to the provisions of the Plan and applicable law.
(d) The Plan Administrator may designate in writing other
persons to carry out its responsibilities under the Plan. The Plan
Administrator may at any time and from time to time remove any person
designated to carry out its responsibilities under the Plan by notice
in writing to the person.
(e) The Plan Administrator may employ persons to render
advice with regard to any of its responsibilities under the Plan.
Charges for all services rendered shall be directly paid by the Company.
(f) The Company shall indemnify and hold harmless the Plan
Administrator from and against any and all claims, losses, costs,
expenses (including, without limitation, attorney's fees and court
costs), damages, actions or causes of action arising from, on account
of or in connection with the performance by the person of his duties in
that capacity, other than those of the foregoing arising from, on
account of or in connection with the willful neglect or willful
misconduct of the person acting.
(g) The statement of specific duties for a Plan
Administrator in this Section 8.02 is not in derogation of any other
duties which a Plan Administrator has under the provisions of the Plan
or applicable law.
ARTICLE IX
CLAIM REVIEW PROCEDURE
9.01 Any person who makes a claim for benefits under the Plan that
is denied shall have the right to appeal the denial of his claim to the Plan
Administrator for a full and fair review at any time within 60 days after the
claimant receives written notice of the denial. In the event of an appeal,
the Plan Administrator shall afford the claimant or his duly authorized
representative the opportunity:
(a) to review documents pertinent to the claim;
(b) to submit issues and comments in writing; and
(c) to discuss the documents and issues with the Plan
Administrator.
9.02 The final decision of the Plan Administrator shall be made not
later than 60 days after receipt from the claimant of a request for review,
unless special circumstances, such as the need to hold a hearing, require an
extension of time for processing, in which case a decision shall be made as
soon as possible but not later than 120 days after receipt of the request for
review and only after appropriate notice to the claimant of the extension is
given before the end of the initial 60-day period. The decision shall be made
in writing, shall include specific reasons for the decision, shall be written
in a manner calculated to be understood by the claimant, shall include
specific references to pertinent Plan provisions on which the decision is
based, and, to the extent permitted by law, shall be final and binding on the
claimant. The decision of the Plan Administrator shall be the final review
provided by the Plan.
ARTICLE X
LIMITATION OF RIGHTS
Participation in the Plan shall not give any Participant any right or
claim except to the extent that the right is specifically fixed under the
terms of the Plan. The establishment of the Plan shall not be construed to
give any Participant a right to be continued in the employ of the Company or
as interfering with the right of the Company to terminate the employment of
any Participant at any time.
ARTICLE XI
LIMITATION OF ASSIGNMENT
11.01 Nonalienation of Benefits
No benefit which shall be payable under the Plan to any person shall be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance or charge, and any attempt to anticipate, alienate, sell,
transfer, assign, pledge, encumber or charge the same shall be void; and no
benefit shall in any manner be liable for, or subject to, the debts,
contracts, liabilities, engagements or torts of any person, nor shall it be
subject to attachment or legal process for, or against, the person, and the
same shall not be recognized under the Plan, except to the extent as may be
required by law.
11.02 Payments to Minors or Incompetents
Whenever any benefit which shall be payable under the Plan is to be paid
to or for the benefit of any person who is then a minor or determined to be
incompetent by qualified medical advice, the Plan Administrator need not
require the appointment of a guardian or custodian, but shall be authorized
to cause the same to be paid over to the person having custody of the minor
or incompetent, or to cause the same to be paid to the minor or incompetent
without the intervention of a guardian or custodian, or to cause the same to
be paid to a legal guardian or custodian of the minor or incompetent if one
has been appointed or to cause the same to be used for the benefit of the
minor or incompetent.
11.03 Missing Participants
Whenever the Plan Administrator cannot within a reasonable time after
payments are to commence locate any person to or for the benefit of whom
payments are to be made after making a reasonable effort to locate the person,
the Company may hold the amount of the payment until the person entitled
thereto is located.
ARTICLE XII
AMENDMENT OR TERMINATION
12.01 The Company may terminate or amend the Plan at any time.
12.02 Upon termination of the Plan, the Company shall not distribute
Plan benefits at the time of termination, but instead shall make payment of
Plan benefits as otherwise provided in the Plan according to the terms and
conditions of the Plan immediately prior to its termination.
ARTICLE XIII
MISCELLANEOUS
13.01 Severability
In case any one or more of the provisions of the Plan shall, for any
reason, be held or found by final judgment of a court of competent
jurisdiction to be invalid, illegal or unenforceable in any respect (a) the
invalidity, illegality or unenforceability shall not affect any other
provisions of the Plan, (b) the Plan shall be construed as if the invalid,
illegal or unenforceable provision had never been contained herein, and (c)
if the effect of a holding or finding that any provision is invalid, illegal
or unenforceable is to modify to the Participant's detriment, reduce or
eliminate any benefit to the Participant intended by the Company, the Company
shall promptly amend the Plan to provide to the Participant (to the extent
lawfully permissible) substantially the same benefit the Participant would
have enjoyed had any provision of this Plan been upheld as legal, valid and
enforceable.
13.02 Governing Law
The Plan shall be construed in accordance with and governed for all
purposes by the laws of the State of Alabama, and to the extent applicable,
by the laws of the United States of America.
13.03 Binding Effect
The provisions of the Plan shall be binding upon and shall inure to the
benefit of the successors and assigns of each Plan Sponsor.
13.04 Notices
Any notice required or permitted to be given to the Plan Administrator
under the Plan shall be in writing and shall be deemed to have been given when
delivered in person or when deposited in the United States mail, registered
or certified postage prepaid, and mailed to the Company at the following
address:
Morrison Incorporated
P.O. Box 160266
4721 Morrison Drive
Mobile, Alabama 36625-0001
Attention: Plan Administrator
for the Morrison Incorporated
Management Retirement Plan
13.05 Tax Withholding
All federal, state and local income tax and other withholding
obligations shall be satisfied by the Company's withholding from the payments
of Plan benefits the amount of tax or other obligation.
IN WITNESS WHEREOF, the Company has caused the Plan to be executed as
of the day and year first above written.
MORRISON INCORPORATED
By: /s/ S.E. BEALL, III
Title: President
ATTEST:
By: /s/ Pfilip G. Hunt
Title: Secretary
[CORPORATE SEAL]
FIRST AMENDMENT TO THE
MORRISON INCORPORATED
MANAGEMENT RETIREMENT PLAN
THIS FIRST AMENDMENT, made as of the 30th day of June, 1994, by MORRISON
RESTAURANTS INC., f/k/a Morrison Incorporated, a corporation duly organized
and existing under the laws of the State of Delaware (the "Primary Sponsor");
W I T N E S S E T H:
WHEREAS, the Primary Sponsor maintains the Morrison Incorporated
Management Retirement Plan under an indenture effective as of June 1, 1989
(the "Plan"); and
WHEREAS, the Primary Sponsor now desires to rename the Plan, to amend
the Plan to allow the Board of Directors to determine from time to time which,
if any, Participants should be permitted to receive retirement benefits
despite terminating employment with the Primary Sponsor and affiliates prior
to attainment of age 55 and for other reasons;
NOW, THEREFORE, the Primary Sponsor does hereby amend the Plan,
effective January 1, 1994, as follows:
1. By renaming the Plan the "Morrison Restaurants Inc. Management
Retirement Plan."
2. By adding to Section 1.01 the phrase "and Section 6.01" immediately
following the phrase "Article IV" therein.
3. By deleting the first sentence of Section 1.11 and by substituting
therefor the following:
"1.11 Final Average Compensation means the average of a
Participant's Compensation for the five consecutive Years of Credited
Service immediately preceding the Participant's retirement, death or
other termination of employment, as the case may be."
4. By substituting in Section 1.21 the phrase "first receives benefit
payments under the Plan" in lieu of the word "retires" each time the same
appears therein.
5. By deleting Subsection (d) of Section 1.22 and by substituting therefor
the following:
"(d) in the event a Participant incurs a Break in Service of more
than three consecutive Plan Years, all Years of Credited Service prior
to the initial Break in Service shall be disregarded for all purposes
under the Plan, unless such action would be inconsistent with any
individual determination by the Board of Directors pursuant to Section
6.01 hereof."
6. By deleting the first sentence of Article V and by substituting therefor
the following:
"Upon the death of any married Participant (a) who is employed
by the Company or its Affiliates on or after age 55 or (b) who
terminated employment with the Company and its Affiliates prior to age
55, retained his Accrued Benefit by action of the Board of Directors in
accordance with Section 6.01 hereof and survived until at least age 55,
the spouse surviving of such Participant shall be entitled to receive
a survivor annuity providing monthly benefits for life equal to fifty
percent (50%) of the annuity which would have been payable to the
Participant and such surviving spouse under the Plan if the Participant
had retired on the day immediately prior to his death and received a
normal form of distribution pursuant to Section 7.02 hereof."
7. By deleting Section 6.01 in its entirety and by substituting therefor
the following:
"6.01 Termination of Employment
The Accrued Benefit of a Participant who terminates employment
with the Company and its Affiliates prior to attaining age 55 shall be
forfeited; provided, however, that the Board of Directors, in its sole
discretion, may determine on a case-by-case basis that the Accrued
Benefit (based upon Final Average Compensation and Years of Credited
Service as of the employment termination date) of any such Participant
shall not be forfeited in which case the affected Participant shall be
entitled to receive his Accrued Benefit with payment commencing upon his
attainment of age 65, unless the affected Participant elects to have
payments commence as early the first day of the month following his
attainment of age 55. An affected Participant who is also a participant
in the Frozen Retirement Plan may not, however, elect to be paid under
this Plan sooner than the date benefits commence under the Frozen
Retirement Plan. The payment of benefits under this Section 6.01 may
be in such forms and shall be subject to the same conditions and
limitations as the payment of retirement benefits under Article VII.
The authority vested in the Board of Directors pursuant to this Section
6.01 to determine, on a case-by-case basis, not to forfeit an otherwise
forfeitable benefit shall not be delegated to any other person or entity
notwithstanding previous delegations of authority by the Board of
Directors pertaining to the administration of the Plan."
8. By deleting Section 12.01 in its entirety and by substituting therefor
the following:
"12.01 The Company may terminate or amend the Plan at any time
by resolution or written direction duly adopted by the Board of
Directors."
Except as specifically provided herein, the Plan shall remain in full
force and effect as prior to this First Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment
to be executed as the day and year first above written.
MORRISON RESTAURANTS INC.
By: /s/ SAMUEL E. BEALL, III
Title: President and Chief Executive
Officer
[CORPORATE SEAL]
ATTEST:
/s/ PFILIP G. HUNT
Title: Senior Vice President, General Counsel
and Secretary
SECOND AMENDMENT TO THE
MORRISON INCORPORATED
MANAGEMENT RETIREMENT PLAN
THIS SECOND AMENDMENT is made as of the 31 day of July , 1995, by
MORRISON RESTAURANTS INC., f/k/a Morrison Incorporated, a corporation duly
organized and existing under the laws of the State of Delaware (the "Primary
Sponsor").
W I T N E S S E T H:
WHEREAS, the Primary Sponsor maintains the Morrison Restaurants Inc.
Management Retirement Plan under an indenture effective as of June 1, 1989,
which was last amended by an indenture dated June 30, 1994 (the "Plan"); and
WHEREAS, the Primary Sponsor now desires to amend the Plan to allow
participants to receive retirement benefits despite terminating employment
with the Primary Sponsor and affiliates prior to attainment of age fifty-five
(55) and for other reasons;
NOW, THEREFORE, the Primary Sponsor does hereby amend the Plan,
effective as of March 29, 1995, as follows:
1. By deleting Subsections (d) and (e) of Section 1.22 and by substituting
therefor the following:
"and (d) in the event a Participant incurs a Break in Service, the Plan
Administrator shall have the sole discretion to determine how many, if
any, Years of Credited Service prior to that Break in Service shall be
counted and for which purposes under the Plan."
2. By deleting the first two sentences of Article V and by substituting
therefor the following:
"Upon the death of any married Participant on or after
attaining age fifty-five (55) but prior to retirement, the spouse
surviving of such Participant shall be entitled to receive a survivor
annuity providing monthly benefits for the spouse's life equal to fifty
percent (50%) of the annuity which would have been payable to the
Participant and such surviving spouse under the Plan if the Participant
had retired on the day immediately prior to his death and received a
normal form of distribution pursuant to Section 7.02 hereof. Upon the
death of any married Participant prior to attaining age fifty-five (55),
the spouse surviving of such Participant shall be entitled to receive
a survivor annuity providing monthly benefits for the spouse's life
equal to fifty percent (50%) of the annuity which would have been
payable had the Participant elected to receive a normal form of
distribution pursuant to Section 7.02 hereof on the first day of the
month following the date the Participant would have attained age fifty-
five (55). Any benefit payable to a surviving spouse pursuant to this
Article V shall commence on the first day of the month following the
Participant's death or, if the Participant died prior to attaining age
fifty-five (55), on the first day of the month following the date the
Participant would have attained age fifty-five (55) had the Participant
survived to that age."
3. By deleting Section 6.01 in its entirety and by substituting therefor
the following:
"6.01 Termination of Employment
The Accrued Benefit of a Participant who terminates employment
with the Company and its Affiliates prior to attaining age fifty-five
(55) shall be based upon Final Average Compensation and Years of
Credited Service as of the employment termination date and the
Participant shall be entitled to receive his Accrued Benefit with
payment commencing as of the first day of the month following his
attainment of age sixty-five (65), unless the affected Participant
elects to have payments commence as early as the first day of the month
following his attainment of age fifty-five (55). A Participant who is
also a participant in the Frozen Retirement Plan may not, however, elect
to be paid under this Section 6.01 sooner than the date benefits
commence under the Frozen Retirement Plan. The payment of benefits
under this Section 6.01 may be in such forms and shall be subject to the
same conditions and limitations as the payment of retirement benefits
under Article VII."
4. By deleting Section 12.01 in its entirety and by substituting therefor
the following:
"12.01 The Company may terminate or amend the Plan at any time
by resolution or written direction duly adopted by the Board of
Directors; provided, however, that no such action may deprive
Participants of any benefits accrued under the Plan prior to the date
of such action."
Except as specifically provided herein, the Plan shall remain in full
force and effect as prior to this Second Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment
to be executed as the day and year first above written.
MORRISON RESTAURANTS INC.
By: /s/ Samuel E. Beall
Title: Chairman and CEO
[CORPORATE SEAL]
ATTEST:
/s/ Pfilip G. Hunt
Title: Secretary
MORRISON RESTAURANTS INC.
SALARY DEFERRAL PLAN
THIS INDENTURE made on the 31 day of December, 1993, by MORRISON
RESTAURANTS INC., f/k/a Morrison Incorporated, a corporation duly organized
and existing under the laws of the State of Delaware (hereinafter called the
"Primary Sponsor");
W I T N E S S E T H:
WHEREAS, the Primary Sponsor established by indenture dated June 1,
1968, the Morrison Employees Retirement Savings Trust, which was subsequently
renamed as the Morrison Incorporated Salary Deferral Plan (the "Plan"), and
which was last restated by indenture dated December 29, 1989;
WHEREAS, the Primary Sponsor now wishes to amend and restate the Plan
to comply with legislation subsequent to the Tax Reform Act of 1986, and
various regulations and rulings issued by government agencies thereon and for
other reasons;
WHEREAS, this plan is intended to be a profit sharing plan within the
meaning of Treasury Regulations Section 1.401-1(b)(1)(ii) and also contains
a cash or deferred arrangement as described in Section 401(k) of the Internal
Revenue Code of 1986; and
WHEREAS, the provisions of the Plan, as amended and restated herein,
shall apply only to Plan years beginning after December 31, 1988, and only
with respect to members who perform an Hour of Service (as defined in the
Plan) in Plan years beginning after December 31, 1988, except to the extent
the provisions are required to apply at an earlier date or are not required
to apply until a later date to comply with applicable law;
NOW, THEREFORE, the Primary Sponsor does hereby amend and restate the
Plan in its entirety, generally effective as of January 1, 1989, to read as
follows:
MORRISON RESTAURANTS INC.
SALARY DEFERRAL PLAN
SECTION 1 DEFINITIONS
SECTION 2 ELIGIBILITY
SECTION 3 CONTRIBUTIONS
SECTION 4 ALLOCATIONS
SECTION 5 WITHDRAWALS DURING EMPLOYMENT
SECTION 6 DEATH BENEFITS
SECTION 7 PAYMENT OF BENEFITS ON RETIREMENT OR DEATH
SECTION 8 PAYMENT OF BENEFITS ON TERMINATION OF EMPLOYMENT
SECTION 9 ADMINISTRATION OF THE PLAN
SECTION 10 CLAIM REVIEW PROCEDURE
SECTION 11 LIMITATION OF ASSIGNMENT, PAYMENTS TO LEGALLY
INCOMPETENT DISTRIBUTEE AND UNCLAIMED PAYMENTS
SECTION 12 PROHIBITION AGAINST DIVERSION
SECTION 13 LIMITATION OF RIGHTS
SECTION 14 AMENDMENT TO OR TERMINATION OF THE PLAN AND THE
TRUST
SECTION 15 ADOPTION OF PLAN BY AFFILIATES
SECTION 16 QUALIFICATION AND RETURN OF CONTRIBUTIONS
SECTION 17 SECTION 16 OF SECURITIES EXCHANGE ACT OF 1934
SECTION 18 INCORPORATION OF SPECIAL LIMITATIONS
APPENDIX A SPECIAL NONDISCRIMINATION RULES
APPENDIX B LIMITATION ON ALLOCATIONS
APPENDIX C TOP-HEAVY PROVISION
SECTION 1
DEFINITIONS
Wherever used herein, the masculine pronoun shall be deemed to include
the feminine, and the singular to include the plural, unless the context
clearly indicates otherwise and the following words and phrases shall, when
used herein, have the meanings set forth below:
1.1 "Account" means the account established and maintained by the Plan
Administrator to reflect the interest of a Member in the Fund. In addition
to any other accounts as the Plan Administrator may establish and maintain,
the Plan Administrator shall establish and maintain separate accounts (each
of which shall be adjusted pursuant to the Plan to reflect income, gains,
losses and other credits or charges attributable thereto) for each Member to
be designated as follows:
(a) "Employee Deferred Account" which shall reflect a Member's
interest in contributions made by a Plan Sponsor under Plan Section 3.1.
(b) "Company Matching Account" which shall reflect a Member's
interest in matching contributions made by a Plan Sponsor under Plan
Section 3.2. The Company Matching Account shall consist of a Company
Stock Subaccount which shall hold shares of Company Stock attributable
to Plan Sponsor matching contributions and cash held pending the
purchase of shares of Company Stock pursuant to Plan Section 3.2(c) and
an Other Investment Subaccount which shall hold all other assets
attributable to Plan Sponsor matching contributions.
(c) "Voluntary Contribution Account" which shall reflect a
Member's interest in Voluntary Contributions made by a Member to the
Fund pursuant to Plan Section 3.3.
(d) "Rollover Account" which shall reflect a Member's interest
in Rollover Amounts.
1.2 "Accrued Benefit" means those shares of Company Stock and cash
held pending the purchase of shares of Company Stock credited to a Member's
Company Stock Subaccount of his Company Matching Account and the value of his
Other Investment Subaccount of his Company Matching Account and the balance
of his other Accounts.
1.3 "Affiliate" means (a) any corporation which is a member of the
same controlled group of corporations (within the meaning of Code Section
414(b)) as is a Plan Sponsor, (b) any other trade or business (whether or not
incorporated) under common control (within the meaning of Code Section 414(c))
with a Plan Sponsor, (c) any other corporation, partnership or other
organization which is a member of an affiliated service group (within the
meaning of Code Section 414(m)) with a Plan Sponsor, and (d) any other entity
required to be aggregated with a Plan Sponsor pursuant to regulations under
Code Section 414(o).
1.4 "Annual Compensation" means the amount paid to, or accrued by, an
Employee by or from a Plan Sponsor (and Affiliates for purposes of
Appendices A and C) during a Plan Year as compensation that would be subject
to income tax withholding under Code Section 3401(a) (but without regard to
any rules that limit the remuneration included in wages based on the nature
or location of the employment or the services performed, such as the exception
for agricultural labor in Code Section 3401(a)(2)), to the extent not in
excess of the Annual Compensation Limit. Notwithstanding the above, Annual
Compensation shall be determined as follows:
(a) (1) in determining with respect to each Plan Sponsor the
amount of contributions made by or on behalf of an Employee under Plan
Section 3 and allocations under Plan Section 4, and (2) for purposes of
applying the provisions of Appendix A hereto for such Plan Years as the
Secretary of the Treasury may allow, Annual Compensation shall only
include amounts received for the portion of the Plan Year during which
the Employee was a Member;
(b) for purposes of applying the Annual Compensation Limit,
with respect to Plan Sections 3 and 4 and Appendix A, the rules
contained in Subsection (c) of the Plan Section containing the
definition of the term "Highly Compensated Employee" shall apply,
except that in applying the rules, the term "family" shall
include only the spouse of the Member and any lineal descendants
of the Member who have not attained age 19 before the close of
the Plan Year; and
(c) for all purposes under the Plan except Appendices B and C
hereto (other than for purposes of determining who is a Key Employee),
Annual Compensation shall include any amount which would have been paid
during a Plan Year, but was contributed by a Plan Sponsor on behalf of
an Employee pursuant to a salary reduction agreement which is not
includable in the gross income of the Employee under Code Section 125,
402(e)(3), or 402(h); and
(d) for purposes of applying the annual addition limits set
forth in Appendix B, the term Plan Sponsor as used in Plan Section 1.4
shall mean Plan Sponsor as that term is defined in Section 4 of Appendix
B.
1.5 "Annual Compensation Limit" means (a) $200,000 for the Plan Year
beginning on January 1, 1989, which amount may be adjusted for each subsequent
Plan Year through the Plan Year beginning on January 1, 1993, based on changes
in the cost of living as provided in regulations issued by the Secretary of
the Treasury, and (b) $150,000 for the Plan Year beginning on January 1, 1994,
which amount may be adjusted for each subsequent Plan Year based on changes
in the cost of living as provided in regulations issued by the Secretary of
the Treasury.
1.6 "Beneficiary" means the person or trust that a Member designated
most recently in writing to the Plan Administrator; provided, however, that
if the Member has failed to make a designation, no person designated is alive,
no trust has been established, or no successor Beneficiary has been designated
who is alive, the term "Beneficiary" means (a) the Member's spouse or (b) if
no spouse is alive, the Member's surviving children, or (c) if no children are
alive, the Member's parent or parents, or (d) if no parent is alive, the legal
representative of the deceased Member's estate. Notwithstanding the preceding
sentence, the spouse of a married Member shall be his Beneficiary unless that
spouse has consented in writing to the designation by the Member of some other
person or trust and the spouse's consent acknowledges the effect of the
designation and is witnessed by a notary public or a Plan representative. A
Member may change his designation at any time. However, a Member may not
change his designation without further consent of his spouse under the terms
of the preceding sentence unless the spouse's consent permits designation of
another person or trust without further spousal consent and acknowledges that
the spouse has the right to limit consent to a specific beneficiary and that
the spouse voluntarily relinquishes this right. Notwithstanding the above,
the spouse's consent shall not be required if the Member establishes to the
satisfaction of the Plan Administrator that the spouse cannot be located, if
the Member has a court order indicating that he is legally separated or has
been abandoned (within the meaning of local law) unless a "qualified domestic
relations order" (as defined in Code Section 414(p)) provides otherwise, or
if there are other circumstances as the Secretary of the Treasury prescribes.
If the spouse is legally incompetent to give consent, consent by the spouse's
legal guardian shall be deemed to be consent by the spouse.
1.7 "Board of Directors" means the Board of Directors of the Primary
Sponsor.
1.8 "Break in Service" means the failure of an Employee, in connection
with a termination of employment other than by reason of death or attainment
of a Retirement Date, to complete more than 500 Hours of Service in any Plan
Year.
1.9 "Code" means the Internal Revenue Code of 1986, as amended.
1.10 "Company Stock" means shares of any class of stock issued by the
Primary Sponsor or any Affiliate and constituting "qualifying employer
securities" within the meaning of ERISA Section 407(d)(5)
1.11 "Deferral Amount" means a contribution of a Plan Sponsor on behalf
of a Member pursuant to Plan Section 3.1.
1.12 "Direct Rollover" means a payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.
1.13 "Disability" means a disability of a Member within the meaning of
Code Section 72(m)(7), to the extent that the Member is, or would be, entitled
to disability retirement benefits under the federal Social Security Act or to
the extent that the Member is entitled to recover benefits under any long term
disability plan or policy maintained by the Plan Sponsor. The determination
of whether or not a Disability exists shall be determined by the Plan
Administrator and shall be substantiated by competent medical evidence.
1.14 "Distributee" means an Employee or former Employee. In addition,
the Employee's or former Employee's surviving spouse and the Employee's or
former Employee's spouse or former spouse who is the alternate payee under a
qualified domestic relations order (as defined in Code Section 414(p)) are
Distributees with regard to the interest of the spouse or former spouse.
1.15 "Effective Date" means January 1, 1989.
1.16 "Elective Deferrals" means, with respect to any taxable year of
the Member, the sum of
(a) any Deferral Amounts;
(b) any contributions made by or on behalf of a Member under any
other qualified cash or deferred arrangement as defined in Code
Section 401(k), whether or not maintained by a Plan Sponsor, to the
extent such contributions are not or would not, but for Code
Section 402(g)(1) be included in the Member's gross income for the
taxable year; and
(c) any other contributions made by or on behalf of a Member
pursuant to Code Section 402(g)(3).
1.17 "Eligible Employee" means any Employee of a Plan Sponsor other
than an Employee who is (a) an Employee covered by a collective bargaining
agreement between a union and a Plan Sponsor, provided that retirement
benefits were the subject of good faith bargaining, unless the collective
bargaining agreement provides for participation in the Plan; (b) a leased
employee within the meaning of Code Section 414(n)(2), or deemed to be an
Employee of a Plan Sponsor pursuant to regulations under Code Section 414(o);
or, effective May 1, 1989, (c) an Employee who is a Highly Compensated
Employee. A Member who becomes a Highly Compensated Employee during a Plan
Year shall cease to be an Eligible Employee no later than the first day of the
immediately succeeding Plan Year.
1.18 "Eligible Retirement Plan" means an individual retirement account
described in Code Section 408(a), an individual retirement annuity described
in Code Section 408(b), an annuity plan described in Code Section 403(a) or
a qualified trust described in Code Section 401(a) that accepts the
Distributee's Eligible Rollover Distribution. However, in the case of an
Eligible Rollover Distribution to the surviving spouse, an Eligible Retirement
Plan is an individual retirement account or individual retirement annuity.
1.19 "Eligible Rollover Distribution" means any distribution of all or
any portion of the Distributee's Account, except that an Eligible Rollover
Distribution does not include: any distribution that is one of a series of
substantially equal periodic payments (not less frequently than annually) made
for the life (or life expectancy) of the Distributee or the joint lives (or
joint life expectancies) of the Distributee and the Distributee's designated
Beneficiary, or for a specified period of ten years or more; any distribution
to the extent such distribution is required under Code Section 401(a)(9); and
the portion of any distribution that is not includable in gross income
(determined without regard to the exclusion for net unrealized appreciation
with respect to employer securities).
1.20 "Eligibility Service" means a twelve-consecutive-month period
during which the Employee completes no less than 1,000 Hours of Service
beginning on the date on which the Employee first performs an Hour of Service
upon his employment or reemployment with a Plan Sponsor or, in the event the
Employee fails to complete 1,000 Hours of Service in that
twelve-consecutive-month period, any twelve-consecutive-month period
thereafter, beginning on the anniversary of the date the Employee first
performed an Hour of Service upon his employment or reemployment, during which
the Employee completes no less than 1,000 Hours of Service.
1.21 "Employee" means any person who is (a) employed by a Plan Sponsor
or an Affiliate for purposes of the Federal Insurance Contributions Act, (b)
a leased employee within the meaning of Code Section 414(n)(2) with respect
to a Plan Sponsor, or (c) deemed to be an employee of a Plan Sponsor pursuant
to regulations under Code Section 414(o).
1.22 "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.
1.23 "Fiduciary" means each Named Fiduciary and any other person who
exercises or has any discretionary authority or control regarding management
or administration of the Plan, any other person who renders investment advice
for a fee or has any authority or responsibility to do so with respect to any
assets of the Plan, or any other person who exercises or has any authority or
control respecting management or disposition of assets of the Plan.
1.24 "Fund" means the amount at any given time of cash and other
property held by the Trustee pursuant to the Plan.
1.25 "Highly Compensated Employee" means each Employee who is described
in Subsection (a), unless the Plan Sponsor makes an election pursuant to
Subsection (b).
(a) (1) The Employee during the Plan Year immediately
preceding the Plan Year in question:
(A) was at any time an owner of more than five
percent (5%) of the outstanding stock of a Plan Sponsor or
Affiliate or more than five percent (5%) of the total
combined voting power of all stock of a Plan Sponsor or
Affiliate; or
(B) received Annual Compensation in excess of
$96,368 (for the Plan Year beginning in 1993) which amount
shall be adjusted for changes in the cost of living as
provided in regulations issued by the Secretary of the
Treasury; or
(C) received Annual Compensation in excess of
$64,245 (for the Plan Year beginning in 1993) which amount
shall be adjusted for changes in the cost of living as
provided in regulations issued by the Secretary of the
Treasury, and who was in the group consisting of the most
highly compensated twenty percent (20%) of the Employees;
or
(D) was at any time an officer of the Plan Sponsor
or of any Affiliate whose Annual Compensation was greater
than fifty percent (50%) of the amount in effect under Code
Section 415(b)(1)(A) for the calendar year in which the
Plan Year ends, where the term "officer" means an
administrative executive in regular and continual service
to the Plan Sponsor or Affiliate; provided, however, that
in no event shall the number of officers exceed the lesser
of Clause (i) or (ii) of this Subparagraph (D), where:
(i) equals fifty (50) Employees; and
(ii) equals the greater of (I) three (3)
Employees or (II) ten percent (10%) of the number of
Employees during the Plan Year, with any non-integer
being increased to the next integer.
If for any year no officer of the Plan Sponsor meets the
requirements of this Subparagraph (D), the highest paid
officer of the Plan Sponsor for the Plan Year shall be
considered an officer for purposes of this
Subparagraph (D).
(2) The Employee during the Plan Year in question (A) is
described in Subsection (a)(1)(A), or (B) is both (i) described
in Subsection (a)(1)(B), (a)(1)(C), or (a)(1)(D), and (ii) one of
the 100 Employees who received the most Annual Compensation during
that Plan Year.
The Plan Administrator may make an election to substitute
$64,245 (as adjusted) for $96,368 (as adjusted) in Subparagraph
(B) of Subsection (a)(1) provided that at all times during the
Plan Year the Plan Sponsor and its Affiliates maintain significant
business activities and have Employees in at least two signifi-
cantly separate geographic areas and satisfy such other conditions
as the Secretary of the Treasury prescribes.
For purposes of Subparagraphs (C) and (D) of
Subsection (a)(1), the following shall be excluded when
determining the number of Employees in the most highly compensated
twenty percent (20%) of the Employees and the number of officers:
(i) Employees who have not completed six (6)
months of service,
(ii) Employees who normally work less than 17-1/2
hours per week,
(iii) Employees who normally work during not more
than six (6) months during any Plan Year,
(iv) Employees who have not attained age 21,
(v) Employees who are included in a unit of
employees covered by an agreement which the Secretary of
Labor finds to be a collective bargaining agreement between
employee representatives and the Plan Sponsor or its
Affiliates, provided 90% or more of the Employees are
covered under collective bargaining agreements and the Plan
only covers Employees who are not covered under the
collective bargaining agreements.
(b) Notwithstanding the provisions of Subsection (a), the
Primary Sponsor may elect to determine each Highly Compensated Employee
to be each Employee who during the Plan Year in question is described
in Subsection (a) (determined without regard to the head language of
Subsection (a)(1)), pursuant to the provisions of Treas. Reg. Section
1.414(q)-1T, Q&A-14(b).
(c) For purposes of this Section, if any Employee is a member
of the family of a five percent (5%) owner as defined in
Subsection (a)(1) of this Section or of a Highly Compensated Employee
whose Annual Compensation is such that he is among the ten (10) Highly
Compensated Employees receiving the greatest amount of Annual
Compensation during the Plan Year, then (1) the Employee shall not be
considered a separate Employee, and (2) any Annual Compensation paid to
the Employee, and any applicable contribution or benefit on behalf of
the Employee, shall be treated as if it were paid to, or on behalf of,
the five percent (5%) owner or the Employee who is among the ten (10)
Highly Compensated Employees receiving the greatest amount of Annual
Compensation during the Plan Year. For purposes of this Subsection (c),
the term "family" means with respect to any Employee, the Employee's
spouse and lineal descendants or ascendants and the spouses of lineal
descendants or ascendants.
(d) For purposes of this Section, a former Employee shall be
treated as a Highly Compensated Employee if (1) the former Employee was
a Highly Compensated Employee at the time the former Employee separated
from service with the Plan Sponsor or Affiliate or (2) the former
Employee was a Highly Compensated Employee at any time after the former
Employee attained age 55.
(e) For purposes of this Section, Employees who are nonresident
aliens and who receive no earned income from the Plan Sponsor or an
Affiliate from sources within the United States shall not be treated as
Employees.
(f) For purposes of this Section, Annual Compensation shall
include amounts paid by Affiliates and shall be determined without
regard to the Annual Compensation Limit.
1.26 "Hour of Service" means:
(a) Each hour for which an Employee is paid, or entitled to
payment, for the performance of duties for a Plan Sponsor or any
Affiliate during the applicable computation period, and such hours shall
be credited to the computation period in which the duties are performed.
(b) Each hour for which an Employee is paid, or entitled to
payment, by a Plan Sponsor or any Affiliate on account of a period of
time during which no duties are performed (irrespective of whether the
employment relationship has terminated) due to vacation, holiday,
illness, incapacity (including disability), layoff, jury duty, military
duty or leave of absence.
(c) Each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by a Plan Sponsor or any
Affiliate, and such hours shall be credited to the computation period
or periods to which the award or agreement for back pay pertains rather
than to the computation period in which the award, agreement or payment
is made; provided, that the crediting of Hours of Service for back pay
awarded or agreed to with respect to periods described in Subsection (b)
of this Section shall be subject to the limitations set forth in
Subsection (e).
(d) Solely for purposes of determining whether a Break in
Service has occurred, each hour during any period that the Employee is
absent from work (1) by reason of the pregnancy of the Employee, (2) by
reason of the birth of a child of the Employee, (3) by reason of the
placement of a child with the Employee in connection with the adoption
of the child by the Employee, or (4) for purposes of caring for such
child for a period immediately following its birth or placement. The
hours described in this Subsection (d) shall be credited (A) only in the
computation period in which the absence from work begins, if the
Employee would be prevented from incurring a Break in Service in that
year solely because of that credit, or (B), in any other case, in the
next following computation period.
(e) The Plan Administrator shall credit Hours of Service in
accordance with the provisions of Section 2530.200b-2(b) and (c) of the
U.S. Department of Labor Regulations or such other federal regulations
as may from time to time be applicable and determine Hours of Service
from the employment records of a Plan Sponsor or in any other manner
consistent with regulations promulgated by the Secretary of Labor, and
shall construe any ambiguities in favor of crediting Employees with
Hours of Service. Notwithstanding any other provision of this Section,
in no event shall an Employee be credited with more than 501 Hours of
Service during any single continuous period during which he performs no
duties for the Plan Sponsor or Affiliate.
(f) In the event that an individual becomes an Eligible Employee
of a Plan Sponsor by reason of (a) an acquisition by the Plan Sponsor
of substantially all of the assets of another corporation or entity or
a controlling interest of the stock of another corporation; (b) a merger
of the individual's prior employer with the Plan Sponsor; or (c) the
award of a food services or similar contract to the Plan Sponsor
resulting in the hiring of a group of employees employed immediately
prior to the award of the contract at the same location by an unrelated
employer, then each such Eligible Employee may be credited Hours of
Service based on the services he or she performed with the prior
employer in the manner and subject to such conditions, if any, provided
in resolutions adopted by the Plan Sponsor; provided further that the
crediting of such Hours of Service shall not be permitted in a manner
that discriminates significantly in favor of Highly Compensated
Employees.
1.27 "Investment Committee" means a committee which may be established
to direct the Trustee with respect to investments of the Fund.
1.28 "Investment Fund" means such subfunds of the Fund as may be
established by the Plan Administrator for the investment of Accounts.
1.29 "Investment Manager" means a Fiduciary, other than the Trustee,
the Plan Administrator, or a Plan Sponsor, who may be appointed by the Primary
Sponsor:
(a) who has the power to manage, acquire, or dispose of any
assets of the Fund or a portion thereof;
(b) who (1) is registered as an investment adviser under the
Investment Advisers Act of 1940; (2) is a bank as defined in that Act;
or (3) is an insurance company qualified to perform services described
in Subsection (a) above under the laws of more than one state; and
(c) who has acknowledged in writing that he is a Fiduciary with
respect to the Plan.
1.30 "Member" means any Employee or former Employee who has become a
participant in the Plan for so long as his vested Accrued Benefit has not been
fully distributed pursuant to the Plan.
1.31 "Named Fiduciary" means only the following:
(a) the Plan Administrator;
(b) the Trustee;
(c) the Board of Directors;
(d) the Investment Committee; and
(e) the Investment Manager.
1.32 "Normal Retirement Age" means age 65.
1.33 "Plan Administrator" means the organization or person designated
to administer the Plan.
1.34 "Plan Sponsor" means individually the Primary Sponsor and any
Affiliate or other entity which has adopted the Plan and Trust.
1.35 "Plan Year" means the calendar year.
1.36 "Retirement Date" means the date on which the Member (a) retires
on or after attaining Normal Retirement Age or (b) becomes subject to a
Disability.
1.37 "Rollover Amount" means any amount not less than $200 transferred
to the Fund by a Member (a) which amount qualifies as an Eligible Rollover
Distribution under Code Section 402(c)(4) or 403(a)(4), or a rollover
contribution under 408(d)(3)(A)(ii) and any regulations issued thereunder and
(b) any other amounts transferred to the Fund on behalf of a Member in a
trust-to-trust transfer from any plan meeting the requirements of Code Section
401(a) which is not subject to Code Section 401(a)(11) or 417. No portion of
a Rollover Amount may consist of after-tax amounts.
1.38 "Trust" means the trust established under an agreement dated
December 29, 1989, between the Primary Sponsor and the Trustee to hold the
Fund or any successor agreement.
1.39 "Trustee" means the trustee under the Trust.
1.40 "Valuation Date" means the last day of each month or any other day
which the Plan Administrator declares to be a Valuation Date; provided that,
on a prospective basis after January 1, 1994, the Plan Administrator may in
its sole discretion declare that each Individual Fund may be valued as
frequently as each regular business day of the entity maintaining the
investments in which the Individual Funds are invested, in which case each
regular business day shall constitute Valuation Dates.
1.41 "Voluntary Contribution" means a non-deductible contribution to
the Fund made by the Member pursuant to Plan Section 3.3.
1.42 "Year of Service" means each Plan Year during which a Member has
completed no less than 1,000 Hours of Service.
SECTION 2
ELIGIBILITY
2.1 Each individual who was a Member on the day immediately preceding
the Effective Date shall continue to be a Member as the Effective Date.
2.2 Each Eligible Employee shall become a Member as of the first day
of the first payroll period coinciding with or next following the later of the
date he (a) completes his Eligibility Service or (b) attains age 21.
2.3 Each former Member who is reemployed by a Plan Sponsor shall
become a Member as of the date of his reemployment as an Eligible Employee.
2.4 Each former Employee who completes his Eligibility Service but
terminates employment with a Plan Sponsor before becoming a Member shall
become a Member as of the latest of the date he (a) is reemployed, (b) would
have become a Member if he had not terminated employment, or (c) becomes an
Eligible Employee.
2.5 Solely for the purpose of contributing a Rollover Amount to the
Plan, an Eligible Employee who has not yet become a Member pursuant to any
other provision of this Plan Section 2 shall become a Member as of the date
on which the Rollover Amount is contributed to the Plan.
2.6 In the event that an individual becomes an Eligible Employee of
a Plan Sponsor by reason of (1) an acquisition by the Plan Sponsor of
substantially all of the assets of another corporation or entity or a
controlling interest of the stock of another corporation; (2) a merger of the
individual's prior employer with the Plan Sponsor; or (3) the award of a food
services or similar contract to the Plan Sponsor resulting in the hiring of
a group of employees employed immediately prior to the award of the contract
at the same location by an unrelated employer, then any such Eligible Employee
may become a Member on any earlier date than otherwise specified in this
Section 2 in the manner and subject to such conditions, if any, provided in
resolutions adopted by the Plan Sponsor.
SECTION 3
CONTRIBUTIONS
3.1 (a) The Plan Sponsor shall make a contribution to the Fund on
behalf of each Member who is an Eligible Employee and who has elected
to defer a portion of Annual Compensation otherwise payable to him for
the Plan Year and to have such portion contributed to the Fund. The
election must be made before the Annual Compensation is payable and may
only be made pursuant to an agreement between the Member and the Plan
Sponsor which shall be in such form and subject to such rules and
limitations as the Plan Administrator may prescribe and shall specify
the percentage of Annual Compensation that the Member desires to defer
and to have contributed to the Fund. Once a Member has made an election
for a Plan Year, the Member may revoke or modify his election to reduce
the rate of future deferrals, effective as of the beginning of the
payroll period coinciding with or next following the Plan
Administrator's processing of the revocation or modification pursuant
to normal administrative procedures. Once an election has been revoked
or modified, any subsequent election by the Member shall be effective
as of the first day of the first payroll period coinciding with or next
following the Plan Administrator's processing of the election pursuant
to normal administrative procedures, except that at the request of a
Member in a form acceptable to the Plan Administrator, the election may
be given effect at a later date.
The contribution made by a Plan Sponsor on behalf of a Member
under this Plan Section 3.1(a) shall be in an amount equal to the amount
specified in the Member's deferral agreement, which amount shall not be
less than two percent (2%) nor greater than ten percent (10%) of the
Member's Annual Compensation. The Plan Administrator may adjust said
percentage applicable to a Member who becomes a Highly Compensated
Employees during a Plan Year on a prospective basis, but in no event
shall the percentage be greater than ten percent (10%) of a Member's
Annual Compensation.
(b) Elective Deferrals shall in no event exceed $8,994 (for
1993) in any one taxable year of the Member, which amount shall be
adjusted for changes in the cost of living as provided by the Secretary
of the Treasury. In the event the amount of Elective Deferrals exceeds
$8,994 (for 1993) as adjusted, in any one taxable year then, (1) not
later than the immediately following March 1, the Member may designate
to the Plan the portion of the Member's Deferral Amount which consists
of excess Elective Deferrals, and (2) not later than the immediately
following April 15, the Plan may distribute the amount designated to it
under Paragraph (1) above, as adjusted to reflect income, gain, or loss
attributable to it through the date of the distribution, and reduced by
any "Excess Deferral Amounts," as defined in Appendix A hereto,
previously distributed or recharacterized with respect to the Member for
the Plan Year beginning with or within that taxable year. The payment
of the excess Elective Deferrals, as adjusted and reduced, from the Plan
shall be made to the Member without regard to any other provision in the
Plan. In the event that a Member's Elective Deferrals exceed $8,994,
as adjusted, in any one taxable year under the Plan and other plans of
the Plan Sponsor and its Affiliates, the Member shall be deemed to have
designated for distribution under the Plan the amount of excess Elective
Deferrals, as adjusted and reduced, by taking into account only Elective
Deferral amounts under the Plan and other plans of the Plan Sponsor and
its Affiliates.
3.2 (a) Each Plan Sponsor proposes to make matching contributions
to the Fund with respect to each Plan Year on behalf of each Member
entitled to an allocation under Plan Section 4.1 in an amount equal to
(i) twenty percent (20%) of the Member's Annual Compensation deferred
by the Member pursuant to Plan Section 3.1 in the case of a Member who
has completed at least three (3) Years of Service but fewer than ten
(10) Years of Service; (ii) thirty percent (30%) of the Member's Annual
Compensation deferred by the Member pursuant to Plan Section 3.1 in the
case of a Member who has completed at least ten (10) Years of Service
but fewer than twenty (20) Years of Service; and (iii) forty percent
(40%) of the Member's Annual Compensation deferred by the Member
pursuant to Plan Section 3.1 in the case of a Member who has completed
at least twenty (20) Years of Service. The Plan Sponsor's contribution
shall be reduced to the extent necessary, if any, to comply with the
limitations in Appendices A and B hereof.
(b) Notwithstanding any other provision of this Plan Section 3.2
to the contrary, in the case of a Member who becomes a Highly
Compensated Employee during a Plan Year, the Plan Sponsor proposes to
make a matching contribution, in lieu of any contribution on behalf of
the Highly Compensated Employee under Plan Section 3.2(a), on behalf of
such Highly Compensated Employee in an amount equal to twenty percent
(20%) of the Highly Compensated Employee's Annual Compensation
contributed to the Member's Employee Deferred Account pursuant to Plan
Section 3.1, regardless of the Member's Years of Service.
(c) Plan Sponsor contributions made pursuant to this Plan
Section may be made in cash or in kind, including, without limitation,
shares of Company Stock, at the discretion of the Plan Sponsor. Unless
the Primary Sponsor directs otherwise, the Trustee shall use Plan
Sponsor matching contributions made in the form of cash to acquire
shares of Company Stock that are issued and outstanding. The Primary
Sponsor may request the Trustee to acquire the necessary shares by
purchasing (i) newly issued shares of Company Stock, or (ii) shares of
Company Stock held as treasury shares.
(d) Effective July 1, 1992, for purposes of determining the
amount of matching contributions to be credited to a Member's Company
Matching Account, all or a portion of a Member's years of employment
with a predecessor employer may be counted if the Member became an
Eligible Employee of a Plan Sponsor by reason of (1) an acquisition by
the Plan Sponsor of substantially all of the assets of another
corporation or entity or of a controlling interest of the stock of
another corporation; (2) a merger of the Member's prior employer with
the Plan Sponsor; or (3) the award of a food services or similar
contract to the Plan Sponsor resulting in the hiring of a group of
employees employed immediately prior to the award of the contract at the
same location by an unrelated employer and if, at the time of the
acquisition, merger or award or as soon as practicable thereafter, the
Plan Sponsor adopts resolutions providing for the counting of such years
of employment in favor of a group or category of similarly situated
individuals that included the Member. The counting of any such years
of employment shall be specified in those resolutions and shall be
subject to such conditions, if any, provided therein; provided further
that the counting of any such years of employment shall not be made in
a manner that discriminates in favor of Highly Compensated Employees.
3.3 Subject to such rules and limitations as the Plan Administrator
may from time to time prescribe, each Member who contributed at least two
percent (2%) of his Annual Compensation under Plan Section 3.1 may contribute
to the Fund as a Voluntary Contribution an amount of his Annual Compensation
not in excess of ten percent (10%) thereof; provided, however, that this
limitation shall apply in the aggregate to all Voluntary Contributions made
by a Member to two (2) or more plans maintained by the Plan Sponsor.
Voluntary Contributions shall be made to the Fund through regular payroll
deductions or in such other manner as shall be agreed upon by each Member and
the Plan Administrator. The Plan Administrator may, at any time, suspend the
making of any further Voluntary Contributions. Any Member who becomes a
Highly Compensated Employee during a Plan Year shall be ineligible to make
further Voluntary Contributions.
3.4 Any Member may, with the consent of the Plan Administrator and
subject to such rules and conditions as the Plan Administrator may prescribe,
transfer a Rollover Amount to the Fund; provided, however, that the Plan
Administrator shall not administer this provision in a manner which is
discriminatory in favor of Highly Compensated Employees.
3.5 Contributions may be made only in cash or other property which is
acceptable to the Trustee. In no event will the sum of contributions under
Plan Sections 3.1, 3.2 and 3.3 exceed the deductible limits under Code Section
404.
SECTION 4
ALLOCATIONS
4.1 As soon as reasonably practicable following the date of
withholding by the Plan Sponsor, if applicable, and receipt by the Trustee,
Plan Sponsor contributions made on behalf of each Member under Plan
Sections 3.1 and 3.2, Voluntary Contributions and Rollover Amounts contributed
by the Member shall be allocated to the Employee Deferred Account, Voluntary
Contribution Account and Rollover Account, respectively, of the Member on
behalf of whom the contributions were made.
4.2 Except as otherwise provided in the Plan and the Trust, as of each
Valuation Date, the Trustee shall determine the net income or net loss of the
Fund as hereinafter set forth.
(a) The net income or net loss of the Company Stock Subaccounts
shall be determined separately by the Trustee and allocated to each
Member's Account as follows:
(1) Any cash dividends with respect to Company Stock
allocated to the Company Stock Subaccount of a Member as of the
record date on which such cash dividend was declared shall be
immediately allocated to the Other Investment Subaccount of the
Member's Account.
(2) Any additional shares of Company Stock which are
issued with respect to any Company Stock held in a Company Stock
Subaccount for any reason, including, but not limited to, stock
dividends, mergers or stock splits, shall be immediately allocated
to the Company Stock Subaccount as of the date on which the
additional shares of Company Stock are delivered to the Trustee.
The additional shares of Company Stock shall be credited to each
Company Stock Subaccount based upon the number of shares of
Company Stock in each Company Stock Subaccount as of the record
date on which the stock dividend or other issuance was declared
or received, as the case may be.
(b) The net income or net loss of the Other Investment
Subaccounts shall be determined separately by the Trustee and allocated
to each Member's Account as follows:
(1) To the cash income, if any, since the last Valuation
Date, there shall be added or subtracted, as the case may be, any
net increase or decrease, since the last Valuation Date, in the
fair market value of the assets of each Individual Fund, any gain
or loss on the sale or exchange of assets of the Individual Fund
since the last Valuation Date, accrued interest since the last
Valuation Date with respect to any interest bearing security as
to which the purchaser would be required to pay such accrued
interest in addition to the quoted price, the amount of any
dividend which shall have been declared since the last Valuation
Date but not paid on shares of stock owned by the Individual Fund
if the market quotation used in determining the value of such
shares is ex-dividend, and the amount of any other assets of the
Individual Fund determined by the Trustee to be income since the
last Valuation Date.
(2) From the sum thereof there shall be deducted all
charges, expenses, and liabilities accrued since the last
Valuation Date which are proper under the provisions of the Plan
and Trust and which in the discretion of the and which in the
discretion of the Trustee are properly chargeable against income
of the Individual Fund for the period.
The net income or net loss so determined shall be allocated as of
the Valuation Date to the Other Investment Subaccounts of each Member
in the proportion that the balance of the Member's Other Investment
Subaccount invested in the Individual Fund as of the preceding Valuation
Date bears to the total value of all Members' Other Investment
Subaccounts invested in the Individual Fund as of the preceding
Valuation Date.
SECTION 5
WITHDRAWALS DURING EMPLOYMENT
5.1 Effective January 1, 1994, subject to the rules and conditions as
the Plan Administrator may prescribe, by request, a Member may receive a
distribution as soon as administratively practicable of all or a portion of
the balance of his Rollover Account and Voluntary Contribution Account;
provided any such Rollover Amounts have been held in the Plan for a minimum
of two (2) years. Any request for a distribution under this Section must be
made on the forms and in the manner prescribed by the Plan Administrator.
5.2 The Trustee shall, upon the direction of the Plan Administrator,
distribute all or a portion of a Member's Employee Deferred Account consisting
of Deferral Amounts (but not earnings thereon) prior to the time such account
is otherwise distributable in accordance with the other provisions of the
Plan; provided, however, that any such distribution shall be made only if the
Member is an Employee and demonstrates that he is suffering from "hardship"
as determined herein. For purposes of this Plan Section, a distribution will
be deemed to be an account of hardship if the distribution is on account of:
(a) expenses for medical care described in Code
Section 213(d) incurred by the Member, his spouse, or any
dependents of the Member (as defined in Code Section 152) or
necessary for these persons to obtain medical care described in
Code Section 213(d);
(b) purchase (excluding mortgage payments) of a principal
residence for the Member;
(c) payment of tuition and related educational fees for
the next twelve (12) months of post-secondary education for the
Member, his spouse, children, or dependents;
(d) the need to prevent the eviction of the Member from
his principal residence or foreclosure on the mortgage of the
Member's principal residence; or
(e) any other contingency determined by the Internal
Revenue Service to constitute an "immediate and heavy financial
need" within the meaning of Treasury Regulations Section
1.401(k)-1(d).
5.3 In addition to the requirements set forth in Plan Section 5.2, any
distribution pursuant to Plan Section 5.2 shall not be in excess of the amount
necessary to satisfy the need determined under Plan Section 5.2 and shall also
be subject to the requirements of Subsection (a) or (b) of this Plan Section.
(a) (1) The Member shall first obtain all distributions, other
than hardship distributions, and all nontaxable loans currently
available under all plans maintained by the Plan Sponsor;
(2) the Plan Sponsor shall not permit Elective Deferrals
or after-tax employee contributions to be made to the Plan or any
other plan maintained by the Plan Sponsor, for a period of twelve
(12) months after the Member receives the distribution pursuant
to this Plan Section; and
(3) the Plan Sponsor shall not permit Elective Deferrals
to be made to the Plan or any other plan maintained by the Plan
Sponsor for the Member's taxable year immediately following the
taxable year of the hardship distribution in excess of the limit
under Plan Section 3.1(b) for the taxable year, less the amount
of the Elective Deferrals made to the Plan or any other plan
maintained by the Plan Sponsor for the taxable year in which the
distribution under this Plan Section occurs.
(B) (1) The Member shall first obtain all other distributions,
other than hardship distributions, and all nontaxable loans
available under all plans maintained by the Plan Sponsor; and
(2) the Plan Administrator shall determine that it can
reasonably rely on the Member's certification by execution of a
form provided by the Plan Administrator that the need determined
under Plan Section 5.2 cannot be relieved --
(A) through reimbursement or compensation by
insurance or otherwise,
(B) by reasonable liquidation of the assets of the
Member, his spouse and minor children, to the extent that
the liquidation would not itself cause an immediate and
heavy financial need and to the extent that the assets of
the spouse and minor children are reasonably available to
the Member,
(C) by cessation of Elective Deferrals, or
(D) by other distributions or nontaxable (at the
time of the distribution) loans from plans maintained by
the Plan Sponsor or any other employer, or by borrowing
from commercial sources on reasonable commercial terms.
Such distribution shall be made only in accordance with such rules, policies,
procedures, restrictions, and conditions as the Plan Administrator may from
time to time adopt. Any determination of the existence of hardship and the
amount to be distributed on account thereof shall be made by the Plan
Administrator (or such other person as may be required to make such decisions)
in accordance with the foregoing rules as applied in a uniform and
nondiscriminatory manner; provided that, unless the Member requests otherwise,
any such distribution shall include the amount necessary to pay any federal,
state and local income taxes and penalties reasonably anticipated to result
from the distribution.
5.4 Any distribution under this Plan Section shall be made in a lump
sum to the Member, and shall be subject to the Eligible Rollover Distribution
requirements set forth in Plan Section 7.3.
SECTION 6
DEATH BENEFITS
6.1 Upon the death of a Member who is an Employee at the time of his
death, his Beneficiary shall be entitled to the full value of his Accrued
Benefit.
6.2 Upon the death of a Member who is not an Employee at the time of
his death, prior to the distribution of his vested Accrued Benefit, his
Beneficiary shall be entitled to his vested Accrued Benefit.
6.3 If, subsequent to the death of a Member, the Member's Beneficiary
dies while entitled to receive benefits under the Plan, the successor
Beneficiary, if any, or the Beneficiary listed under Subsection (a), (b) or
(c) of the Plan Section containing the definition of the term "Beneficiary"
shall generally be entitled to receive benefits under the Plan. However, if
the deceased Beneficiary was the Member's spouse at the time of the Member's
death, or if no successor Beneficiary shall have been designated by the Member
and be alive and no Beneficiary listed under Subsection (a), (b) or (c) of the
Plan Section containing the definition of the term "Beneficiary" shall be
alive, the Member's unpaid vested Accrued Benefit shall be paid to the
personal representative of the deceased Beneficiary's estate.
6.4 Any benefit payable under this Section 6 shall be paid in
accordance with and subject to the provisions of Plan Section 7 or Plan
Section 8, whichever is applicable, after receipt by the Trustee from the Plan
Administrator of notice of the death of the Member.
SECTION 7
PAYMENT OF BENEFITS ON RETIREMENT OR DEATH
7.1 The Accrued Benefit of a Member who has attained a Retirement Date
or has attained Normal Retirement Age or died while an Employee shall be fully
vested and nonforfeitable. As of a Member's Retirement Date or death while
an Employee, he or his Beneficiary shall be entitled to his Accrued Benefit
to be paid in accordance with this Plan Section 7. The Accrued Benefit of a
Member which is to be paid under this Section 7 shall be determined as of the
Valuation Date coinciding with or immediately preceding the date the Accrued
Benefit is valued for imminent payout purposes pursuant to normal
administrative procedures, and shall be increased by any amounts allocated to
the Member's Account after that Valuation Date and reduced by any
distributions made from the Member's account after that Valuation Date.
Payments to a Member, or to the Beneficiary of a deceased Member, shall
commence as soon as administratively feasible after the Member's Retirement
Date or death. If the amount of the payment required to commence on a date
cannot be ascertained by that date, payment shall commence retroactively to
that date and shall commence no later than sixty (60) days after the earliest
date on which the amount of payment can be ascertained.
7.2 The payment of a Member's Accrued Benefit shall be in the form of
one lump sum in cash. If the Member's interest in the Morrison Stock Fund (as
defined in the Trust) equals or exceeds the value of one hundred (100) shares
of Company Stock, that interest may be distributed in the form of whole shares
of Company Stock if the Member so elects by written instrument delivered to
the Plan Administrator.
7.3 Notwithstanding any provisions of the Plan to the contrary that
would otherwise limit a Distributee's election under this Plan Section 7,
effective January 1, 1993, a Distributee may elect, at the time and in the
manner prescribed by the Plan Administrator, to have any portion of a
distribution pursuant to this Plan Section which is an Eligible Rollover
Distribution paid directly to an Eligible Retirement Plan specified by the
Distributee in a direct rollover so long as all Eligible Rollover
Distributions to a Distributee for a calendar year total or are expected to
total at least $200 and, in the case of a Distributee who elects to directly
receive a portion of an Eligible Rollover Distribution and directly roll the
balance over to an Eligible Rollover Plan, the portion that is to be directly
rolled over totals at least $500.
7.4 Notwithstanding any provision of the Plan to the contrary,
effective January 1, 1994, if a Member's vested Accrued Benefit exceeds
$3,500, it shall not be distributed before the Member's "required beginning
date," as defined in Plan Section 7.5(c), or death without the consent of the
Member.
7.5 Notwithstanding any other provisions of the Plan,
(a) Prior to the death of a Member, all retirement payments
hereunder shall --
(1) be distributed to the Member not later than the
required beginning date (as defined below) or,
(2) be distributed, commencing not later than the required
beginning date (as defined below)--
(A) in accordance with regulations prescribed by
the Secretary of the Treasury, over the life of the Member
or over the lives of the Member and his designated
individual Beneficiary, if any, or
(B) in accordance with regulations prescribed by
the Secretary of the Treasury, over a period not extending
beyond the life expectancy of the Member or the joint life
and last survivor expectancy of the Member and his
designated individual Beneficiary, if any.
(b) (1) If --
(A) the distribution of a Member's retirement
payments have begun in accordance with Subsection (a)(2) of
this Plan Section, and
(B) the Member dies before his entire vested
Accrued Benefit has been distributed to him,
then the remaining portion of his vested Accrued Benefit shall be
distributed at least as rapidly as under the method of
distribution being used under Subsection (a)(2) of this Plan
Section as of the date of his death.
(2) If a Member dies before the commencement of retirement
payments hereunder, the entire interest of the Member shall be
distributed within five (5) years after his death.
(3) If --
(A) any portion of a Member's vested Accrued
Benefit is payable to or for the benefit of the Member's
designated individual Beneficiary, if any,
(B) that portion is to be distributed, in
accordance with regulations prescribed by the Secretary of
the Treasury, over the life of the designated individual
Beneficiary or over a period not extending beyond the life
expectancy of the designated individual Beneficiary, and
(C) the distributions begin not later than one (1)
year after the date of the Member's death or such later
date as the Secretary of the Treasury may by regulations
prescribe,
then, for purposes of Paragraph (2) of this Subsection (b), the
portion referred to in Subparagraph (A) of this Paragraph (3)
shall be treated as distributed on the date on which the
distributions to the designated individual Beneficiary begin.
(4) If the designated individual Beneficiary referred to
in Paragraph (3)(A) of this Subsection (b) is the surviving spouse
of the Member, then --
(A) the date on which the distributions are
required to begin under Paragraph (3)(C) of this Subsection
(b) shall not be earlier than the date on which the Member
would have attained age 70-1/2, and
(B) if the surviving spouse dies before the
distributions to such spouse begin, this Subsection (b)
shall be applied as if the surviving spouse were the
Member.
(c) For purposes of this Plan Section, the term "required
beginning date" means April 1 of the calendar year following the
calendar year in which the Member attains age 70-1/2. Notwithstanding
the foregoing, in the case of a Member who is not described in Section
1(b)(3) of Appendix C hereto and who has attained age 70-1/2 before
January 1, 1988, the term "required beginning date" means April 1 of the
calendar year following the calendar year in which the Member retires
or otherwise terminates employment.
(d) Distributions will be made in accordance with the
regulations under Code Section 401(a)(9), including the minimum
distribution incidental benefit requirement of Treas. Reg. Section
1.401(a)(9)-2.
SECTION 8
PAYMENT OF BENEFITS ON TERMINATION OF EMPLOYMENT
8.1 Transfer of a Member from one Plan Sponsor to another Plan Sponsor
or to an Affiliate shall not be deemed for any purpose under the Plan to be
a termination of employment of the Member.
8.2 In the event of the termination of employment of a Member for
reasons other than death or attainment of a Retirement Date, the Member's
Accrued Benefit shall be determined as of the Valuation Date coinciding with
or immediately preceding the date the Member's Accrued Benefit is valued for
imminent payout purposes pursuant to normal administrative procedures,
increased by any contributions or Rollover Amounts allocated to the Account
of the Member after that Valuation Date and reduced by any distributions
therefrom.
8.3 That portion of a Member's Accrued Benefit in which he is vested
shall be the balance of his Account as of the Valuation Date coinciding with
or immediately preceding the date his Accrued Benefit is paid.
8.4 The Member shall be entitled to payment in the form of payment set
forth in Plan Section 7.2. Payment shall be made as soon as administratively
feasible after the Member terminates employment; provided, however, effective
January 1, 1994, if the Member's vested Accrued Benefit exceeds $3,500 it will
not be distributed before the Member's "required beginning date," within the
meaning of Plan Section 7.5(c), or death without the Member's consent. In no
event shall payment be made later than sixty (60) days after the end of the
Plan Year in which the Normal Retirement Age of the Member occurs. Payment
shall be subject to the minimum distribution requirements set forth in Plan
Section 7.5, and the Eligible Rollover Distribution requirements set forth in
Plan Section 7.3.
8.5 If a Member who has terminated employment with a Plan Sponsor is
reemployed by a Plan Sponsor or an Affiliate on or prior to the payment to the
payment to the Member of the full amount of his Accrued Benefit, the Member's
Account shall be treated as the Account of a Member who has not terminated
employment other than in regard to allocations of Plan Sponsor contributions
which would have been made to his Account at any Valuation Date occurring
while the Member was not employed by a Plan Sponsor.
8.6 In the event that a Plan amendment directly or indirectly changes
the vesting schedule, the vesting percentage for each Member in his Accrued
Benefit accumulated to the date when the amendment is adopted shall not be
reduced as a result of the amendment. In addition, any Member with at least
three (3) Years of Service may irrevocably elect to remain under the
pre-amendment vesting schedule with respect to all of his benefits accrued
both before and after the amendment.
SECTION 9
ADMINISTRATION OF THE PLAN
9.1 Trust Agreement. The Primary Sponsor shall establish a Trust
with the Trustee designated by the Board of Directors for the management of
the Fund, which Trust shall form a part of the Plan and is incorporated herein
by reference.
9.2 Operation of the Plan Administrator. The Primary Sponsor shall
appoint a Plan Administrator. If an organization is appointed to serve as the
Plan Administrator, then the Plan Administrator may designate in writing a
person who may act on behalf of the Plan Administrator. The Primary Sponsor
shall have the right to remove the Plan Administrator at any time by notice
in writing. The Plan Administrator may resign at any time by written notice
of resignation to the Trustee and the Primary Sponsor. Upon removal or
resignation, or in the event of the dissolution of the Plan Administrator, the
Primary Sponsor shall appoint a successor.
9.3 Fiduciary Responsibility.
(a) The Plan Administrator, as a Named Fiduciary, may allocate
its fiduciary responsibilities among Fiduciaries other than the Trustee,
designated in writing by the Plan Administrator and may designate in
writing persons other than the Trustee to carry out its fiduciary
responsibilities under the Plan. The Plan Administrator may remove any
person designated to carry out its fiduciary responsibilities under the
Plan at any time by notice in writing to such person.
(b) The Plan Administrator and each other Fiduciary may employ
persons to perform services and to render advice with regard to any of
the Fiduciary's responsibilities under the Plan. Charges for all such
services performed and advice rendered may be directly paid by each Plan
Sponsor but until paid shall constitute a charge against the Fund.
(c) Each Plan Sponsor shall indemnify and hold harmless each
person constituting the Plan Administrator or the Investment Committee,
if any, from and against any and all claims, losses, costs, expenses
(including, without limitation, attorney's fees and court costs),
damages, actions or causes of action arising from, on account of or in
connection with the performance by such person of his duties in such
capacity, other than such of the foregoing arising from, on account of
or in connection with the willful neglect or willful misconduct of such
person.
9.4 Duties of the Plan Administrator.
(a) The Plan Administrator shall advise the Trustee with respect
to all payments under the terms of the Plan and shall direct the Trustee
in writing to make such payments from the Fund; provided, however, in
no event shall the Trustee be required to make such payments if the
Trustee has actual knowledge that such payments are contrary to the
terms of the Plan and the Trust.
(b) The Plan Administrator shall from time to time establish
rules, not contrary to the provisions of the Plan and the Trust, for the
administration of the Plan and the transaction of its business. All
elections and designations under the Plan by a Participant or
Beneficiary shall be made on forms prescribed by the Plan
Administrator. The Plan Administrator shall have discretionary
authority to construe the terms of the Plan and shall determine all
questions arising in the administration, interpretation and application
of the Plan, including, but not limited to, those concerning eligibility
for benefits and it shall not act so as to discriminate in favor of any
person. All determinations of the Plan Administrator shall be
conclusive and binding on all Employees, Members, Beneficiaries and
Fiduciaries, subject to the provisions of the Plan and the Trust and
subject to applicable law.
(c) The Plan Administrator shall furnish Members and
Beneficiaries with all disclosures now or hereafter required by ERISA
or the Code. The Plan Administrator shall file, as required, the
various reports and disclosures concerning the Plan and its operations
as required by ERISA and by the Code, and shall be solely responsible
for establishing and maintaining all records of the Plan and the Trust.
(d) The statement of specific duties for a Plan Administrator
in this Plan Section is not in derogation of any other duties which a
Plan Administrator has under the provisions of the Plan or the Trust or
under applicable law.
9.5 Investment Manager. The Primary Sponsor may, by action in
writing certified by notice to the Trustee, appoint an Investment Manager.
Any Investment Manager may be removed in the same manner in which appointed,
and in the event of any removal, the Investment Manager shall, as soon as
possible, but in no event more than thirty (30) days after notice of removal,
turn over all assets managed by it to the Trustee or to any successor
Investment Manager appointed, and shall make a full accounting to the Primary
Sponsor with respect to all assets managed by it since its appointment as an
Investment Manager.
9.6 Investment Committee. The Primary Sponsor may, by action in
writing certified by notice to the Trustee, appoint an Investment Committee.
The Primary Sponsor shall have the right to remove any person on the
Investment Committee at any time by notice in writing to such person. A
person on the Investment Committee may resign at any time by written notice
of resignation to the Primary Sponsor. Upon such removal or resignation, or
in the event of the death of a person on the Investment Committee, the Primary
Sponsor may appoint a successor. Until a successor has been appointed, the
remaining persons on the Investment Committee may continue to act as the
Investment Committee.
9.7 Action by a Plan Sponsor. Any action to be taken by a Plan
Sponsor shall be taken by resolution or written direction duly adopted by its
board of directors or appropriate governing body, as the case may be;
provided, however, that by such resolution or written direction, the board of
directors or appropriate governing body, as the case may be, may delegate to
any officer or other appropriate person of a Plan Sponsor the authority to
take any such actions as may be specified in such resolution or written
direction, other than the power to amend, modify or terminate the Plan or the
Trust or to determine the basis of any Plan Sponsor contributions.
SECTION I.
CLAIM REVIEW PROCEDURE
10.1 If a Member or Beneficiary is denied a claim for benefits under
a Plan, the Plan Administrator shall provide to the claimant written notice
of the denial within 90 days after the Plan Administrator receives the claim,
unless special circumstances require an extension of time for processing the
claim. If such an extension of time for processing is required, written
notice of the extension shall be furnished to the claimant prior to the
termination of the initial 90-day period. In no event shall the extension
exceed a period of 90 days from the end of such initial period. The extension
notice shall indicate the special circumstances requiring an extension of time
and the date by which the Plan Administrator expects to render the final
decision.
10.2 If the claimant is denied a claim for benefits, the Plan
Administrator shall provide, within the time frame set forth in Plan Section
10.1, written notice of the denial which shall set forth:
(a) the specific reasons for the denial;
(b) specific references to the pertinent provisions of the Plan
on which the denial is based;
(c) a description of any additional material or information
necessary for the claimant to perfect the claim and an explanation of
why the material or information is necessary; and
(d) an explanation of the Plan's claim review procedure.
10.3 After receiving written notice of the denial of a claim, a
claimant or his representative may:
(a) request a full and fair review of the denial by written
application to the Plan Administrator;
(b) review pertinent documents; and
(c) submit issues and comments in writing to the Plan
Administrator.
10.4 If the claimant wishes a review of the decision denying his claim
to benefits under the Plan, he must submit the written application to the Plan
Administrator within sixty (60) days after receiving written notice of the
denial.
10.5 Upon receiving the written application for review, the Plan
Administrator may schedule a hearing for purposes of reviewing the claimant's
claim, which hearing shall take place not more than thirty (30) days from the
date on which the Plan Administrator received the written application for
review.
10.6 At least ten (10) days prior to the scheduled hearing, the
claimant and his representative designated in writing by him, if any, shall
receive written notice of the date, time, and place of the scheduled hearing.
The claimant or his representative may request that the hearing be rescheduled
for his convenience on another reasonable date or at another reasonable time
or place.
10.7 All claimants requesting a review of the decision denying their
claim for benefits may employ counsel for purposes of the hearing.
10.8 No later than sixty (60) days following the receipt of the
written application for review, the Plan Administrator shall submit its
decision on the review in writing to the claimant involved and to his
representative, if any; provided, however, a decision on the written
application for review may be extended, in the event special circumstances
such as the need to hold a hearing require an extension of time, to a day no
later than one hundred twenty (120) days after the date of receipt of the
written application for review. The decision shall include specific reasons
for the decision and specific references to the pertinent provisions of the
Plan on which the decision is based.
SECTION 11
LIMITATION OF ASSIGNMENT, PAYMENTS TO LEGALLY
INCOMPETENT DISTRIBUTEE AND UNCLAIMED PAYMENTS
11.1 No benefit which shall be payable under the Plan to any person
shall be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance or charge, and any attempt to anticipate,
alienate, sell, transfer, assign, pledge, encumber or charge the same shall
be void; and no such benefit shall in any manner be liable for, or subject to,
the debts, contracts, liabilities, engagements or torts of any person, nor
shall it be subject to attachment or legal process for, or against, such
person, and the same shall not be recognized under the Plan, except to such
extent as may be required by law. Notwithstanding the above, this Plan
Section shall not apply to a "qualified domestic relations order" (as defined
in Code Section 414(p)), and benefits may be paid pursuant to the provisions
of such an order. The Plan Administrator shall develop procedures (in
accordance with applicable federal regulations) to determine whether a
domestic relations order is qualified, and, if so, the method and the
procedures for complying therewith.
11.2 If any person who shall be entitled to any benefit under the Plan
shall become bankrupt or shall attempt to anticipate, alienate, sell,
transfer, assign, pledge, encumber or charge such benefit under the Plan, then
the payment of any such benefit in the event a Member or Beneficiary is
entitled to payment shall, in the discretion of the Plan Administrator, cease
and terminate and in that event the Trustee shall hold or apply the same for
the benefit of such person, his spouse, children, other dependents or any of
them in such manner and in such proportion as the Plan Administrator shall
determine.
11.3 Whenever any benefit which shall be payable under the Plan is to
be paid to or for the benefit of any person who is then a minor or determined
to be incompetent by qualified medical advice, the Plan Administrator need not
require the appointment of a guardian or custodian, but shall be authorized
to cause the same to be paid over to the person having custody of such minor
or incompetent, or to cause the same to be paid to such minor or incompetent
without the intervention of a guardian or custodian, or to cause the same to
be paid to a legal guardian or custodian of such minor or incompetent if one
has been appointed or to cause the same to be used for the benefit of such
minor or incompetent.
11.4 If the Plan Administrator cannot ascertain the whereabouts of any
Member to whom a payment is due under the Plan, the Plan Administrator may
direct that the payment and all remaining payments otherwise due to the Member
be cancelled on the records of the Plan and the amount thereof applied as a
forfeiture to reduce Plan Sponsor contributions, except that, in the event the
Member later notifies the Plan Administrator of his whereabouts and requests
the payments due to him under the Plan, the Plan Sponsor shall contribute to
the Plan an amount equal to the payment to be paid to him as soon as
administratively feasible.
SECTION 12
PROHIBITION AGAINST DIVERSION
At no time shall any part of the Fund be used for or diverted to
purposes other than the exclusive benefit of the Members or their
Beneficiaries, subject, however, to the payment of all taxes and
administrative expenses and subject to the provisions of the Plan with respect
to returns of contributions.
SECTION 13
LIMITATION OF RIGHTS
Membership in the Plan shall not give any Employee any right or claim
except to the extent that such right is specifically fixed under the terms of
the Plan. The adoption of the Plan and the Trust by any Plan Sponsor shall
not be construed to give any Employee a right to be continued in the employ
of a Plan Sponsor or as interfering with the right of a Plan Sponsor to
terminate the employment of any Employee at any time.
SECTION 14
AMENDMENT TO OR TERMINATION OF THE
PLAN AND THE TRUST
14.1 The Primary Sponsor reserves the right at any time to modify or
amend or terminate the Plan or the Trust in whole or in part; provided,
however, that the Primary Sponsor shall have no power to modify or amend the
Plan in such manner as would cause or permit any portion of the funds held
under a Plan to be used for, or diverted to, purposes other than for the
exclusive benefit of Members or their Beneficiaries, or as would cause or
permit any portion of a fund held under the Plan to become the property of a
Plan Sponsor; and provided further, that the duties or liabilities of the
Trustee shall not be increased without its written consent. No such
modifications or amendments shall have the effect of retroactively changing
or depriving Members or Beneficiaries of rights already accrued under the
Plan. No Plan Sponsor other than the Primary Sponsor shall have the right to
so modify, amend or terminate the Plan or the Trust. Notwithstanding the
foregoing, each Plan Sponsor may terminate its own participation in the Plan
and Trust pursuant to the Plan.
14.2 Each Plan Sponsor other than the Primary Sponsor shall have the
right to terminate its participation in the Plan and Trust by resolution of
its board of directors or other appropriate governing body and notice in
writing to the Primary Sponsor and the Trustee unless such termination would
result in the disqualification of the Plan or the Trust or would adversely
affect the exempt status of the Plan or the Trust as to any other Plan
Sponsor. If contributions by or on behalf of a Plan Sponsor are completely
terminated, the Plan and Trust shall be deemed terminated as to such Plan
Sponsor. Any termination by a Plan Sponsor, shall not be a termination as to
any other Plan Sponsor.
14.3 (a) If the Plan is terminated by the Primary Sponsor or if
contributions to the Trust should be permanently discontinued, it shall
terminate as to all Plan Sponsors and the Fund shall be used, subject
to the payment of expenses and taxes, for the benefit of Members and
Beneficiaries, and for no other purposes, and the Account of each
affected Member shall be fully vested and nonforfeitable,
notwithstanding the provisions of the Plan Section which sets forth the
vesting schedule.
(b) In the event of the partial termination of the Plan, each
affected Member's Account shall be fully vested and nonforfeitable,
notwithstanding the provisions of the Plan Section which sets forth the
vesting schedule.
14.4 In the event of the termination of the Plan or the Trust with
respect to a Plan Sponsor, the Accounts of the Members with respect to the
Plan as adopted by such Plan Sponsor shall be held subject to the instructions
of the Plan Administrator; provided that the Trustee shall not be required to
make any distribution until it receives a copy of an Internal Revenue Service
determination letter to the effect that the termination does not affect the
qualified status of the Plan or the exempt status of the Trust or, in the
event that such letter is applied for and is not issued, until the Trustee is
reasonably satisfied that adequate provision has been made for the payment of
all taxes which may be due and owing by the Trust.
14.5 In the case of any merger or consolidation of the Plan with, or
any transfer of the assets or liabilities of the Plan to, any other plan
qualified under Code Section 401, the terms of the merger, consolidation or
transfer shall be such that each Member would receive (in the event of
termination of the Plan or its successor immediately thereafter) a benefit
which is no less than the benefit which the Member would have received in the
event of termination of the Plan immediately before the merger, consolidation
or transfer.
14.6 Notwithstanding any other provision of the Plan, an amendment to
the Plan --
(a) which eliminates or reduces an early retirement benefit, if
any, or which eliminates or reduces a retirement-type subsidy (as
defined in regulations issued by the Department of the Treasury), if
any, or
(b) which eliminates an optional form of benefit
shall not be effective with respect to benefits attributable to service before
the amendment is adopted. In the case of a retirement-type subsidy described
in Subsection (a) above, this Plan Section shall be applicable only to a
Member who satisfies, either before or after the amendment, the preamendment
conditions for the subsidy.
SECTION 15
ADOPTION OF PLAN BY AFFILIATES
Any corporation or other business entity related to the Primary Sponsor
by function or operation and any Affiliate, if the corporation, business
entity or Affiliate is authorized to do so by written direction adopted by the
Board of Directors, may adopt the Plan and the related Trust by action of the
board of directors or other appropriate governing body of such corporation,
business entity or Affiliate. Any adoption shall be evidenced by certified
copies of the resolutions of the foregoing board of directors or governing
body indicating the adoption and by the execution of the Trust by the adopting
corporation, or business entity or Affiliate. The resolution shall state and
define the effective date of the adoption of the Plan by the Plan Sponsor and,
for the purpose of Code Section 415, the "limitation year" as to such Plan
Sponsor. Notwithstanding the foregoing, however, if the Plan and Trust as
adopted by an Affiliate or other corporation or business entity under the
foregoing provisions shall fail to receive the initial approval of the
Internal Revenue Service as a qualified Plan and Trust under Code Sections
401(a) and 501(a), any contributions by the Affiliate or other corporation or
business entity after payment of all expenses will be returned to such Plan
Sponsor free of any trust, and the Plan and Trust shall terminate, as to the
adopting Affiliate or other corporation or business entity.
SECTION 16
QUALIFICATION AND RETURN OF CONTRIBUTIONS
16.1 If the Plan and the related Trust fail to receive the initial
approval of the Internal Revenue Service as a qualified plan and trust within
one (1) year after the date of denial of qualification (a) the contribution
of a Plan Sponsor after payment of all expenses will be returned to a Plan
Sponsor free of the Plan and Trust, (b) contributions made by a Member shall
be returned to the Member who made the contributions, and (c) the Plan and
Trust shall thereupon terminate.
16.2 All Plan Sponsor contributions to the Plan are contingent upon
deductibility. To the extent permitted by the Code and other applicable laws
and regulations thereunder, upon a Plan Sponsor's request, a contribution
which was made by reason of a mistake of fact or which was nondeductible under
Code Section 404, shall be returned to a Plan Sponsor within one (1) year
after the payment of the contribution, or the disallowance of the deduction
(to the extent disallowed), whichever is applicable.
In the event of a contribution which was made by reason of a mistake of
fact or which was nondeductible, the amount to be returned to the Plan Sponsor
shall be the excess of the contribution above the amount that would have been
contributed had the mistake of fact or the mistake in determining the
deduction not occurred, less any net loss attributable to the excess. Any net
income attributable to the excess shall not be returned to the Plan Sponsor.
No return of any portion of the excess shall be made to the Plan Sponsor if
the return would cause the balance in a Member's Account to be less than the
balance would have been had the mistaken contribution not been made.
SECTION 17
SECTION 16 OF SECURITIES EXCHANGE ACT OF 1934
Notwithstanding any other provision of this Plan, the provisions of this
Plan that set forth the formula or formulas that determine the amount, price
or timing of awards to persons subject to the reporting requirements of
Section 16 of the Securities Exchange Act of 1934 (the "Act") and any other
provisions of this Plan of the type referred to in Section 16b-3(c)(2)(ii) of
the Act shall not be amended more than once every six months, other than to
comport with changes in the Code, ERISA, or the rules thereunder. Further,
to the extent required, the persons described in the preceding sentence shall
be subject to such withdrawal, investment and other restrictions necessary to
satisfy Rule 16b-3 under the Act. This Section 17 is intended to comply with
Rule 16b-3 under the Act and shall be effective only to the extent required
by such rule and shall be interpreted and administered in accordance with such
rule.
SECTION 18
INCORPORATION OF SPECIAL LIMITATIONS
Appendices A, B, and C to the Plan, attached hereto, are incorporated
by reference and the provisions of the same shall apply notwithstanding
anything to the contrary contained herein.
IN WITNESS WHEREOF, the Primary Sponsor has caused this indenture to be
executed as of the date first above written.
MORRISON RESTAURANTS INC.
By: /s/ Samuel E. Beall
Title: President and Chief Executive Officer
ATTEST:
/s/ Pfilip G. Hunt
Title: Senior Vice President,
General Counsel and Secretary
[CORPORATE SEAL]
APPENDIX A
SPECIAL NONDISCRIMINATION RULES
SECTION 1
As used in this Appendix, the following words shall have the following
meanings:
(a) "Eligible Member" means a Member who is an Employee during
any particular Plan Year.
(b) "Highly Compensated Eligible Member" means any Eligible
Member who is a Highly Compensated Employee.
(c) "Matching Contribution" means any contribution made by a
Plan Sponsor to a Company Matching Account and any other contribution
made to a plan by a Plan Sponsor or an Affiliate on behalf of an
Employee on account of a contribution made by an Employee or on account
of an Elective Deferral.
(d) "Qualified Matching Contributions" means Matching
Contributions which are immediately nonforfeitable when made, and which
would be nonforfeitable, regardless of the age or service of the
Employee or whether the Employee is employed on a certain date, and
which may not be distributed, except upon one of the events described
under Code Section 401(k)(2)(B) and the regulations thereunder.
(e) "Qualified Nonelective Contributions" means contributions
of the Plan Sponsor or an Affiliate, other than Matching Contributions
or Elective Deferrals, which are nonforfeitable when made, and which
would be nonforfeitable regardless of the age or service of the Employee
or whether the Employee is employed on a certain date, and which may not
be distributed, except upon one of the events described under Code
Section 401(k)(2)(B) and the regulations thereunder.
SECTION 2
In addition to any other limitations set forth in the Plan, for each
Plan Year one of the following tests must be satisfied:
(a) the actual deferral percentage for the Highly Compensated
Eligible Members must not be more than the actual deferral percentage
of all other Eligible Members multiplied by 1.25; or
(b) the excess of the actual deferral percentage for the Highly
Compensated Eligible Members over that of all other Eligible Members
must not be more than two (2) percentage points, and the actual deferral
percentage for the Highly Compensated Eligible Members must not be more
than the actual deferral percentage of all other Eligible Members
multiplied by two (2).
The "actual deferral percentage" for the Highly Compensated Eligible Members
and all other Eligible Members for a Plan Year is the average in each group
of the ratios, calculated separately for each Employee, of the Deferral
Amounts contributed by the Plan Sponsor on behalf of an Employee for the Plan
Year to the Annual Compensation of the Employee in the Plan Year. In
addition, for purposes of calculating the "actual deferral percentage" as
described above, Deferral Amounts of Employees who are not Highly Compensated
Employees which are prohibited by Code Section 401(a)(30) shall not be taken
into consideration. Except to the extent limited by Treasury Regulation
Section 1.401(k)-1(b)(5) and any other applicable regulations promulgated by
the Secretary of the Treasury, all or part of the Qualified Matching
Contributions and Qualified Nonelective Contributions made pursuant to the
Plan may be treated as Deferral Amounts for purposes of determining the
"actual deferral percentage."
SECTION 3
If the Deferral Amounts contributed on behalf of any Highly Compensated
Eligible Member exceeds the amount permitted under the "actual deferral
percentage" test described in Section 2 of this Appendix A for any given Plan
Year, then before the end of the Plan Year following the Plan Year for which
the Excess Deferral Amount was contributed, (a) the amount of the Excess
Deferral Amount for the Plan Year, as adjusted to reflect income, gain, or
loss attributable to it through the date the Excess Deferral Amount is
distributed to the Member and reduced by any excess Elective Deferrals as
determined pursuant to Plan Section 3.1 previously distributed to the Member
for the Member's taxable year ending with or within the Plan Year, may be
distributed to the Highly Compensated Eligible Member or (b) to the extent
provided in regulations issued by the Secretary of the Treasury, the Plan
Administrator may, in its discretion, allow each affected Member to elect,
within two and one-half months after the end of the Plan Year for which the
Excess Deferral Amount was contributed, to treat the Excess Deferral Amount,
unadjusted for earnings, gains, and losses, but as so reduced, as an amount
distributed to the Member and then contributed as an after-tax contribution
by the Member to the Plan ("recharacterized amounts"). The income allocable
to such Excess Deferral Amount shall be determined in a similar manner as
described in Plan Section 4.2. The Excess Deferral Amount to be distributed
or recharacterized shall be reduced by Deferral Amounts previously distributed
or recharacterized for the taxable year ending in the same Plan Year, and
shall also be reduced by Deferral Amounts previously distributed or
recharacterized for the Plan Year beginning in such taxable year. For all
other purposes under the Plan other than this Appendix A recharacterized
amounts shall continue to be treated as Deferral Amounts. In the event the
multiple use of limitations contained in Sections 2(b) and 5(b) of this
Appendix, pursuant to Treasury Regulations Section 1.401(m)-2 as promulgated
by the Secretary of the Treasury, requires a corrective distribution, such
distribution shall be made pursuant to this Section 3, and not Section 6 of
Appendix A.
For purposes of this Section 3, "Excess Deferral Amount" means, with respect
to a Plan Year, the excess of:
(a) the aggregate amount of Deferral Amounts contributed by a
Plan Sponsor on behalf of Highly Compensated Eligible Members for the
Plan Year, over
(b) the maximum amount of Deferral Amounts permitted under
Section 2 of this Appendix A for the Plan Year, which shall be
determined by reducing the Deferral Amounts contributed on behalf of
Highly Compensated Eligible Members in order of the actual deferral
percentages beginning with the highest of such percentages.
Distribution of the Excess Deferral Amounts for any Plan Year shall be made
to the Highly Compensated Eligible Members on the basis of the respective
portions of the Excess Deferral Amount attributable to each Highly Compensated
Eligible Member. As to any Highly Compensated Employee who is subject to the
family aggregation rules of Subsection (b) of the Plan Section containing the
definition of the term "Highly Compensated Employee," any distribution of such
Highly Compensated Employee's allocable portion of the Excess Deferral Amount
for a Plan Year shall be allocated among the family members of such Highly
Compensated Employee who are combined to determine the actual deferral
percentage in proportion to the Deferral Amounts taken into account under this
Section 3.
SECTION 4
The Plan Administrator shall have the responsibility of monitoring the
Plan's compliance with the limitations of this Appendix A and shall have the
power to take all steps it deems necessary or appropriate to ensure
compliance, including, without limitation, restricting the amount which Highly
Compensated Eligible Members can elect to have contributed pursuant to Plan
Section 3.1. Any actions taken by the Plan Administrator pursuant to this
Section 4 shall be pursuant to non-discriminatory procedures consistently
applied.
SECTION 5
In addition to any other limitations set forth in the Plan, Matching
Contributions under the Plan and the amount of nondeductible employee
contributions under the Plan, for each Plan Year must satisfy one of the
following tests:
(a) The contribution percentage for Highly Compensated Eligible
Members must not exceed 125% of the contribution percentage for all
other Eligible Members; or
(b) The contribution percentage for Highly Compensated Eligible
Members must not exceed the lesser of (1) 200% of the contribution
percentage for all other Eligible Members, and (2) the contribution
percentage for all other Eligible Members plus two (2) percentage
points.
Notwithstanding the foregoing, for purposes of this Section 5, the terms
Highly Compensated Eligible Member and Eligible Member shall not include any
Member who is not eligible to receive a Matching Contribution under the
provisions of the Plan, other than as a result of the Member failing to
contribute to the Plan or failing to have an Elective Deferral contributed to
the Plan on the Member's behalf. Notwithstanding the foregoing, if Qualified
Matching Contributions are taken into account for purposes of applying the
test contained in Section 2 of this Appendix A, they shall not be taken into
account under this Section 5. In applying the above tests, the Plan
Administrator shall comply with any regulations promulgated by the Secretary
of the Treasury which prevent or restrict the use of the test contained in
Section 2(b) of this Appendix A and the test contained in Section 5(b) of this
Appendix A. The "contribution percentage" for Highly Compensated Eligible
Members and for all other Eligible Members for a Plan Year shall be the
average of the ratios, calculated separately for each Member, of (A) to (B),
where (A) is the amount of Matching Contributions under the Plan (excluding
Qualified Matching Contributions which are used to apply the test set forth
in Section 2 of this Appendix A or Matching Contributions which are used to
satisfy the minimum required contributions to the Accounts of Eligible Members
who are not Key Employees pursuant to Section 1 of Appendix C to the Plan) and
nondeductible employee contributions made under the Plan for the Eligible
Member for the Plan Year, and where (B) is the Annual Compensation of the
Eligible Member for the Plan Year. Except to the extent limited by Treasury
Regulation Section 1.401(m)-1(b)(5) and any other applicable regulations
promulgated by the Secretary of the Treasury, a Plan Sponsor may elect to
treat Deferral Amounts and Qualified Nonelective Contributions as Matching
Contributions for purpose of determining the "contribution percentage,"
provided the Deferral Amounts, excluding those treated as Matching
Contributions, satisfy the test set forth in Section 2 of Appendix A.
SECTION 6
If the Matching Contributions and nondeductible employee contributions
and, if taken into account under Section 5 of this Appendix A, the Deferral
Amounts made by or on behalf of Highly Compensated Eligible Members exceed the
amount permitted under the "contribution percentage test" for any given Plan
Year, then, before the close of the Plan Year following the Plan Year for
which the excess aggregate contributions were made, the amount of the excess
aggregate contributions attributable to the Plan for the Plan Year, as
adjusted to reflect any income, gain or loss attributable to such
contributions through the date the excess aggregate contributions are
distributed, shall be distributed. The income allocable to such contributions
shall be determined in a similar manner as described in Plan Section 4.2. As
to any Highly Compensated Employee, any distribution of his allocable portion
of the excess aggregate contributions for a Plan Year shall first be
attributed to any nondeductible employee contributions made by the Member
during the Plan Year for which no corresponding Plan Sponsor contribution is
made and then to any remaining nondeductible employee contributions made by
the Member during the Plan Year and any Matching Contributions thereon. As
between the Plan and any other plan or plans maintained by the Plan Sponsor
in which excess aggregate contributions for a Plan Year are held, each such
plan shall distribute a pro-rata share of each class of contribution based on
the respective amounts of a class of contribution made to each plan during the
Plan Year. The payment of the excess aggregate contributions shall be made
without regard to any other provision in the Plan. In the event the multiple
use of limitations contained in Sections 2(b) and 5(b) of this Appendix,
pursuant to Treasury Regulation Section 1.401(m)-2 as promulgated by the
Secretary of the Treasury, requires a corrective distribution, such
distribution shall be made pursuant to Section 3 of Appendix A, and not this
Section 6.
For purposes of this Section 6, with respect to any Plan Year, "excess
aggregate contributions" means the excess of:
(a) the aggregate amount of the Matching Contributions and
nondeductible employee contributions and, if taken into account under
Section 5 of this Appendix A, the Deferral Amounts actually made on
behalf of Highly Compensated Eligible Members for the Plan Year, over
(b) the maximum amount of the contributions permitted under the
limitations of Section 5 of this Appendix A, determined by reducing
contributions made on behalf of Highly Compensated Eligible Members in
order of their contribution percentages beginning with the highest of
such percentages.
Distribution of nondeductible employee contributions or Matching Contributions
in the amount of the excess aggregate contributions for any Plan Year shall
be made with respect to Highly Compensated Employees on the basis of the
respective portions of the excess aggregate contributions attributable to each
Highly Compensated Employee. As to any Highly Compensated Employee who is
subject to the family aggregation rules of Subsection (b) of the Plan Section
containing the definition of the term "Highly Compensated Employee," any
distribution of such Highly Compensated Employee's allocable portion of the
excess aggregate contributions for a Plan Year shall be allocated among the
family members of such Highly Compensated Employee which are combined to
determine the contribution percentage in proportion to the contributions taken
into account under this Section 6.
The determination of the amount of excess aggregate contributions under this
Section 6 shall be made after (1) first determining the excess Elective
Deferrals under Plan Section 3.1(b), and (2) then determining the Excess
Deferral Amounts under Section 3 of this Appendix A.
SECTION 7
Except to the extent limited by rules promulgated by the Secretary of
the Treasury, if a Highly Compensated Eligible Member is a participant in any
other plan of the Plan Sponsor or any Affiliate which includes Matching
Contributions, deferrals under a cash or deferred arrangement pursuant to Code
Section 401(k), or nondeductible employee contributions, any contributions
made by or on behalf of the Member to the other plan shall be allocated with
the same class of contributions under the Plan for purposes of determining the
"actual deferral percentage" and "contribution percentage" under the Plan;
provided, however, contributions that are made under an "employee stock
ownership plan" (within the meaning of Code Section 4975(e)(7)) shall not be
combined with contributions under any plan which is not an employee stock
ownership plan (within the meaning of Code Section 4975(e)(7)).
Except to the extent limited by rules promulgated by the Secretary of
the Treasury, if the Plan and any other plans which include Matching
Contributions, deferrals under a cash or deferred arrangement pursuant to Code
Section 401(k), or nondeductible employee contributions are considered as one
plan for purposes of Code Section 401(a)(4) and 410(b)(1), any contributions
under the other plans shall be allocated with the same class of contributions
under the Plan for purposes of determining the "contribution percentage" and
"actual deferral percentage" under the Plan; provided, however, contributions
that are made under an "employee stock ownership plan" (within the meaning of
Code Section 4975(e)(7)) shall not be combined with contributions under any
plan which is not an employee stock ownership plan (within the meaning of Code
Section 4975(e)(7)).
APPENDIX B
LIMITATION ON ALLOCATIONS
SECTION 1
The "annual addition" for any Member for any one limitation year may not
exceed the lesser of:
(a) $30,000 (or, if greater, one-quarter of the dollar
limitation in effect under Code Section 415(b)(1)(A)), adjusted for
changes in the cost of living as provided in regulations issued by the
Secretary of the Treasury); or
(b) 25% of the Member's Annual Compensation.
SECTION 2
For the purposes of this Appendix B, the term "annual addition" for any
Member means for any limitation year, the sum of certain Plan Sponsor and
Member contributions, and other amounts as determined in Code
Section 415(c)(2) in effect for that limitation year.
SECTION 3
In the event that a Plan Sponsor maintains a defined benefit plan under
which a Member also participates, the sum of the defined benefit plan fraction
and the defined contribution plan fraction for any limitation year for any
Member may not exceed 1.0.
(a) The defined benefit plan fraction for any limitation year
is a fraction:
(1) the numerator of which is the projected annual benefit
of the Member under the defined benefit plan (determined as of the
close of such year); and
(2) the denominator of which is the lesser of
(A) the product of 1.25, multiplied by the maximum
annual benefit allowable under Code Section 415(b)(1)(A),
or
(B) the product of
(i) 1.4, multiplied by
(ii) the maximum amount which may be taken
into account under Code Section 415(b)(1)(B) with
respect to the Member under the defined benefit plan
for the limitation year (determined as of the close
of the limitation year).
(b) The defined contribution plan fraction for any limitation
year is a fraction:
(1) the numerator of which is the sum of a Member's annual
additions as of the close of the year; and
(2) the denominator of which is the sum of the lesser of
the following amounts determined for the year and for all prior
limitation years during which the Member was employed by a Plan
Sponsor:
(A) the product of 1.25, multiplied by the dollar
limitation in effect under Code Section 415(c)(1)(A) for
the limitation year (determined without regard to Code
Section 415(c)(6)); or
(B) the product of
(i) 1.4, multiplied by
(ii) the amount which may be taken into
account under Code Section 415(c)(1)(B) (or Code
Section 415(c)(7), if applicable) with respect to
the Member for the limitation year.
SECTION 4
For purposes of this Appendix B, the term "limitation year" shall mean
a Plan Year unless a Plan Sponsor elects, by adoption of a written resolution,
to use any other twelve-month period adopted in accordance with regulations
issued by the Secretary of the Treasury. For purposes of applying the
limitations set forth in this Appendix B, the term "Plan Sponsor" shall mean
a Plan Sponsor and any other corporations which are members of the same
controlled group of corporations (as described in Code Section 414(b), as
modified by Code Section 415(h)) as is a Plan Sponsor, any other trades or
businesses (whether or not incorporated) under common control (as described
in Code Section 414(c), as modified by Code Section 415(h)) with a Plan
Sponsor, any other corporations, partnerships, or other organizations which
are members of an affiliated service group (as described in Code
Section 414(m)) with a Plan Sponsor, and any other entity required to be
aggregated with a Plan Sponsor pursuant to regulations under Code
Section 414(o).
SECTION 5
For purposes of applying the limitations of this Appendix B, all defined
contribution plans maintained or deemed to be maintained by a Plan Sponsor
shall be treated as one defined contribution plan, and all defined benefit
plans now or previously maintained or deemed to be maintained by a Plan
Sponsor shall be treated as one defined benefit plan. In the event any of the
actions to be taken pursuant to Section 6 of this Appendix or pursuant to any
language of similar import in another defined contribution plan are required
to be taken as a result of the annual additions of a Member exceeding the
limitations set forth in Section 1 of this Appendix because of the Member's
participation in more than one defined contribution plan, the actions shall
first be taken with respect to this Plan.
SECTION 6
In the event that as a result of a reasonable error in estimating the
Member's Annual Compensation, the annual addition allocated to the Account of
a Member exceeds the limitations set forth in Section 1 of this Appendix B or
in the event that the aggregate contributions made on behalf of a Member under
both a defined benefit plan and a defined contribution plan, subject to the
reduction of allocations in other defined contribution plans required by
Section 5 of this Appendix B, cause the aggregate limitation fraction set
forth in Section 3 of this Appendix B to be exceeded, the Plan Administrator
shall, in writing, direct the Trustee to take such of the following actions
as the Plan Administrator shall deem appropriate, specifying in each case the
amount or amounts of contributions involved:
(a) A Member's annual addition shall be reduced by distributing
to the Member Voluntary Contributions made by the Member which cause the
annual addition to exceed such limitations;
(b) If further reduction is necessary, contributions made by the
Plan Sponsor on behalf of the Member pursuant to Plan Section 3.1 with
respect to which no contribution is made under Plan Section 3.2 shall
be reduced inthe amount of the remaining excess and distributed to the
Member;
(c) If further reduction is necessary, contributions made by the
Plan Sponsor on behalf of the Member pursuant to Plan Section 3.1 and
contributionsof the Plan Sponsor thereon pursuant to Plan Section 3.2
shall be reduced in the amount of the remaining excess. The amount of
the reductionunder Plan Section 3.1 shall be distributed to the Member.
The amount ofthe reduction under Plan Section 3.2 shall be reallocated
to the Company Matching Accounts of Members who are not affected by the
limitation inthe same proportion as the contribution of the Plan
Sponsor for the year is allocated under Plan Section 4.1 to the Accounts
of such Members; and
(d) If the contribution of the Plan Sponsor would cause the
annual addition to exceed the limitations set forth herein with respect
to all Members under the Plan, the portion of such contribution in
excess of the limitations shall be segregated in a suspense account.
While the suspense account is maintained, (1) no Plan Sponsor
contributions under the Plan shall be made which would be precluded by
this Appendix B, (2) income, gains and loses of the Fund shall not be
allocated to such suspense account and (3) amounts in the suspense
account shall be allocated in the same manner as Plan Sponsor
contributions under the Plan as of each Valuation Date on which Plan
Sponsor contributions may be allocated until the suspense account is
exhausted. In the event of the termination of the Plan, the amounts in
the suspense account shall be returned to the Plan Sponsor to the extent
that such amounts may not then be allocated to the Members' Accounts.
APPENDIX C
TOP-HEAVY PROVISIONS
SECTION 1
As used in this Appendix, the following words shall have the following
meanings:
(a) "Determination Date" means, with respect to any Plan Year,
the last day of the preceding Plan Year, or, in the case of the first
Plan Year, means the last day of the first Plan Year.
(b) "Key Employee" means an Employee or former Employee
(including a Beneficiary of a Key Employee or former Key Employee) who
at any time during the Plan Year containing the Determination Date or
any of the four (4) preceding Plan Years is:
(1) An officer described in the Subsection of the Plan
Section containing the definition of the term "Highly Compensated
Employee";
(2) One of the ten (10) Employees owning both (A) more
than one-half percent (1/2%) of the outstanding stock of the Plan
Sponsor or an Affiliate, more than one-half percent (1/2%) of the
total combined voting power of all stock of the Plan Sponsor or
an Affiliate, or more than one-half percent (1/2%) of the capital
or profits interest in the Plan Sponsor or an Affiliate, and (B)
the largest percentage ownership interests in the Plan Sponsor or
any of its Affiliates, and whose Annual Compensation is equal to
or greater than the amount in effect under Section 1(a) of
Appendix B to the Plan for the calendar year in which the
Determination Date falls; or
(3) An owner of more than five percent (5%) of the
outstanding stock of the Plan Sponsor or an Affiliate or more than
five percent (5%) of the total combined voting power of all stock
of the Plan Sponsor or an Affiliate; or
(4) An owner of more than one percent (1%) of the
outstanding stock of the Plan Sponsor or an Affiliate or more than
one percent (1%) of the total combined voting power of all stock
of the Plan Sponsor or an Affiliate, and who in such Plan Year had
Annual Compensation from the Plan Sponsor and all of its
Affiliates of more than $150,000.
Employees other than Key Employees are sometimes referred to in this
Appendix as "non-key employees."
(c) "Required Aggregation Group" means:
(1) each plan of the Plan Sponsor and its Affiliates which
qualifies under Code Section 401(a) in which a Key Employee is a
participant, and
(2) each other plan of the Plan Sponsor and its Affiliates
which qualifies under Code Section 401 (a) and which enables any
plan described in Subsection (a) of this Section to meet the
requirements of Code Section 401(a)(4) or 410.
(d) (1) "Top-Heavy" means:
(A) if the Plan is not included in a Required
Aggregation Group, the Plan's condition in a Plan Year for
which, as of the Determination Date:
(i) the present value of the cumulative
Accrued Benefits under the Plan for all Key Employees
exceeds 60 percent of the present value of the
cumulative Accrued Benefits under the Plan for all
Members; and
(ii) the Plan, when included in every
potential combination, if any, with any or all of:
(I) any Required Aggregation Group, and
(II) any plan of the Plan Sponsor which
is not part of any Required Aggregation Group
and which qualifies under Code Section 401 (a)
is part of a Top-Heavy Group (as defined in
Paragraph (2) of this Subsection); and
(B) if the Plan is included in a Required
Aggregation Group, the Plan's condition in a Plan Year for
which, as of the Determination Date:
(i) the Required Aggregation Group is a
Top-Heavy Group (as defined in Paragraph (2) of this
Subsection); and
(ii) the Required Aggregation Group, when
included in every potential combination, if any,
with any or all of the plans of the Plan Sponsor and
its Affiliates which are not part of the Required
Aggregation Group and which qualify under Code
Section 401(a), is part of a Top-Heavy Group (as
defined in Paragraph (2) of this Subsection).
(C) For purposes of Subparagraphs (A)(ii) and
(B)(ii) of this Paragraph (1), any combination of plans
must satisfy the requirements of Code Sections 401(a)(4)
and 410.
(2) A group shall be deemed to be a Top-Heavy Group if:
(A) the sum, as of the Determination Date, of the
present value of the cumulative accrued benefits for all
Key Employees under all plans included in such group
exceeds
(B) 60 percent of a similar sum determined for all
participants in such plans.
(3) (A) For purposes of this Section, the present value
of the accrued benefit for any participant in a defined
contribution plan as of any Determination Date or last day
of a plan year shall be the sum of:
(i) as to any defined contribution plan
other than a simplified employee pension, the account
balance as of the most recent valuation date
occurring within the plan year ending on the
Determination Date or last day of a plan year, and
(ii) as to any simplified employee pension,
the aggregate employer contributions, and
(iii) an adjustment for contributions due as
of the Determination Date or last day of a plan year.
In the case of a plan that is not subject to the minimum
funding requirements of Code Section 412, the adjustment in
Clause (iii) of this Subparagraph (A) shall be the amount
of any contributions actually made after the valuation date
but on or before the Determination Date or last day of the
plan year to the extent not included under Clause (i) or
(ii) of this Subparagraph (A); provided, however, that in
the first plan year of the plan, the adjustment in
Clause (iii) of this Subparagraph (A) shall also reflect
the amount of any contributions made thereafter that are
allocated as of a date in such first plan year. In the
case of a plan that is subject to the minimum funding
requirements, the account balance in Clause (i) and the
aggregate contributions in Clause (ii) of this
Subparagraph (A) shall include contributions that would be
allocated as of a date not later than the Determination
Date or last day of a plan year, even though those amounts
are not yet required to be contributed, and the adjustment
in Clause (iii) of this Subparagraph (A) shall be the
amount of any contribution actually made (or due to be
made) after the valuation date but before the expiration of
the extended payment period in Code Section 412(c)(10) to
the extent not included under Clause (i) or (ii) of this
Subparagraph (A).
(B) For purposes of this Subsection, the present
value of the accrued benefit for any participant in a
defined benefit plan as of any Determination Date or last
day of a plan year must be determined as of the most recent
valuation date which is within a 12-month period ending on
the Determination Date or last day of a plan year as if
such participant terminated as of such valuation date;
provided, however, that in the first plan year of a plan,
the present value of the accrued benefit for a current
participant must be determined either (i) as if the
participant terminated service as of the Determination Date
or last day of a plan year or (ii) as if the participant
terminated service as of such valuation date, but taking
into account the estimated accrued benefit as of the
Determination Date or last day of a plan year. For
purposes of this Subparagraph (B), the valuation date must
be the same valuation date used for computing plan costs
for minimum funding, regardless of whether a valuation is
performed that year. The actuarial assumptions utilized in
calculating the present value of the accrued benefit for
any participant in a defined benefit plan for purposes of
this Subparagraph (B) shall be established by the Plan
Administrator after consultation with the actuary for the
plan, and shall be reasonable in the aggregate and shall
comport with the requirements set forth by the Internal
Revenue Service in Q&A T-26 and T-27 of Regulation
Section 1.416-1.
(C) For purposes of determining the present value
of the cumulative accrued benefit under a plan for any
participant in accordance with this Subsection, the present
value shall be increased by the aggregate distributions
made with respect to the participant (including
distributions paid on account of death to the extent they
do not exceed the present value of the cumulative accrued
benefit existing immediately prior to death) under each
plan being considered, and under any terminated plan which
if it had not been terminated would have been in a Required
Aggregation Group with the Plan, during the 5-year period
ending on the Determination Date or last day of the plan
year that falls within the calendar year in which the
Determination Date falls.
(D) For purposes of this Paragraph (3),
participant contributions which are deductible as
"qualified retirement contributions" within the
meaning of Code Section 219 or any successor, as
adjusted to reflect income, gains, losses, and
other credits or charges attributable thereto,
shall not be considered to be part of the accrued
benefits under any plan.
(E) For purposes of this Paragraph (3), if any
employee is not a Key Employee with respect to any plan for
any plan year, but such employee was a Key Employee with
respect to such plan for any prior plan year, any accrued
benefit for such employee shall not be taken into account.
(F) For purposes of this Paragraph (3), if any
employee has not performed any service for any Plan Sponsor
or Affiliate maintaining the plan during the five-year
period ending on the Determination Date, any accrued
benefit for that employee shall not be taken into account.
(G) (i) In the case of an "unrelated rollover"
(as defined below) between plans which qualify under
Code Section 401(a), (a) the plan providing the
distribution shall count the distribution as a
distribution under Subparagraph (C) of this
Paragraph (3), and (b) the plan accepting the
distribution shall not consider the distribution
part of the accrued benefit under this Section; and
(ii) in the case of a "related rollover"(as
defined below) between plans which qualify under
Code Section 401(a), (a) the plan providing the
distribution shall not count the distribution as a
distribution under Subparagraph (C) of this
Paragraph (3), and (b) the plan accepting the
distribution shall consider the distribution part of
the accrued benefit under this Section.
For purposes of this Subparagraph (G), an "unrelated rollover" is a rollover
as defined in Code Section 402(c)(4) or 408(d)(3) or a plan-to-plan transfer
which is both initiated by the participant and made from a plan maintained by
one employer to a plan maintained by another employer where the employers are
not Affiliates. For purposes of this Subparagraph (G), a "related rollover"
is a rollover as defined in Code Section 402(c)(4) or 408(d)(3) or a
plan-to-plan transfer which is either not initiated by the participant or made
to a plan maintained by the employer or an Affiliate.
SECTION 2
(a) Notwithstanding anything contained in the Plan to the
contrary, except as otherwise provided in Subsection (b) of this
Section, in any Plan Year during which the Plan is Top-Heavy,
allocations of Plan Sponsor contributions for the Plan Year for the
Account of each Member who is not a Key Employee and who has not
separated from service with the Plan Sponsor prior to the end of the
Plan Year shall not be less than 3 percent of the Member's Annual
Compensation. For purposes of this Subsection, an allocation to a
Member's Account resulting from any Plan Sponsor contribution
attributable to a salary reduction or similar arrangement shall not be
taken into account.
(b) (1) The percentage referred to in Subsection (a) of this
Section for any Plan Year shall not exceed the percentage at which
allocations are made or required to be made under the Plan for the
Plan Year for the Key Employee for whom the percentage is highest
for the Plan Year. For purposes of this Paragraph, an allocation
to the Account of a Key Employee resulting from any Plan Sponsor
contribution attributable to a salary reduction or similar
agreement shall be taken into account.
(2) For purposes of this Subsection (b), all defined
contribution plans which are members of a Required Aggregation
Group shall be treated as part of the Plan.
(3) This Subsection (b) shall not apply to any plan
which is a member of a Required Aggregation Group if the
plan enables a defined benefit plan which is a member of
the Required Aggregation Group to meet the requirements of
Code Section 401(a)(4) or 410.
(4) If the Plan Sponsor maintains a defined benefit plan
which is qualified under Code Section 401(a) and which would be
Top-Heavy within the meaning of the Plan for its plan year ending
within or coincident with the Plan Year, no allocation shall be
made pursuant to Subsection (a) of this Section on behalf of any
Member who participates in the defined benefit plan and acquires
a year of service within the meaning of paragraphs (4), (5) and
(6) of Code Section 411(a) under the defined benefit plan for the
plan year, if the defined benefit plan provides generally that the
accrued benefit of the member when expressed as an annual
retirement benefit shall not, when expressed as a percentage of
the Member's compensation, be less than the lesser of (A) 2
percent multiplied by the number of such Years of Service in plan
years during which such plan was Top-Heavy, or (B) 20 percent.
SECTION 3
In any limitation year (as defined in Section 4 of Appendix B to the
Plan) which contains any portion of a Plan Year in which the Plan is Top-
Heavy, the number "1.0" shall be substituted for the number "1.25" in Section
3 of Appendix B to the Plan.
SECTION 4
Notwithstanding anything contained in the Plan to the contrary, in any
Plan Year during which the Plan is Top-Heavy, a Member's interest in his
Accrued Benefit shall not vest at any rate which is slower than the following
schedule, effective as of the first day of that Plan Year:
Full Years Percentage
of Service Vested
Less than 3 0%
3 or more 100%
The Schedule set forth above in this Section 4 shall be inapplicable to a
Member who has failed to perform an Hour of Service after the Determination
Date on which the Plan has become Top-Heavy. When the Plan ceases to be Top-
Heavy, the Schedule set forth above in this Section 4 shall cease to apply;
provided however, that the provisions of the Plan Section dealing with changes
in the vesting schedule shall apply.
FIRST AMENDMENT TO THE
MORRISON RESTAURANTS INC.
SALARY DEFERRAL PLAN
THIS FIRST AMENDMENT made on this 21st day of October , 1994, by
MORRISON RESTAURANTS INC., a corporation duly organized and existing under the
laws of the State of Delaware (the "Primary Sponsor");
W I T N E S S E T H
WHEREAS, the Primary Sponsor maintains the Morrison Restaurants Inc.
Salary Deferral Plan (the "Plan"), which was adopted by indenture dated
June 1, 1968, and was last restated by indenture dated December 31, 1993; and
WHEREAS, the Primary Sponsor desired to amend the Plan in order to
comply with recent changes in the law;
NOW, THEREFORE, the Primary Sponsor does hereby amend the Plan,
effective as of January 1, 1993, by replacing the existing Plan Section 7.3
with the following new Plan Section 7.3:
"7.3 Notwithstanding any provisions of the Plan to the
contrary that would otherwise limit a Distributee's election under
this Plan Section 7, a Distributee may elect, at the time and in
the manner prescribed by the Administrator, to have any portion
of an Eligible Rollover Distribution paid directly to an Eligible
Retirement Plan specified by the Distributee in a direct rollover
so long as all Eligible Rollover Distributions to a Distributee
for a calendar year total or are expected to total at least $200
and, in the case of a Distributee who elects to directly receive
a portion of an Eligible Rollover Distribution and directly roll
the balance over to an Eligible Rollover Plan, the portion that
is to be directly rolled over totals at least $500. If the
Eligible Rollover Distribution is one to which Code Sections
401(a)(11) and 417 do not apply, such Eligible Rollover
Distribution may commence less than 30 days after the notice
required under Treasury Regulations Section 1.411(a)-11(c) is
given, provided that:
(1) the Plan Administrator clearly informs
the Distributee that the Distributee has a right to
a period of at least 30 days after receiving the
notice to consider the decision of whether or not to
elect a distribution (and, if applicable, a
particular distribution option), and
(2) the Distributee, after receiving the
notice, affirmatively elects a distribution."
Except as specifically amended hereby, the Plan shall remain in full
force and effect as prior to this First Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment
to be executed as of the day and year first above written.
MORRISON RESTAURANTS INC.
By: /s/ Pfilip G. Hunt
Title: Senior Vice President
ATTEST:/s/ J. Russell Mothershed
Title: Assistant Secretary
[CORPORATE SEAL]
Appendix 1
SECOND AMENDMENT TO THE
MORRISON RESTAURANTS INC.
SALARY DEFERRAL PLAN
THIS SECOND AMENDMENT is made on this 30th day of June , 1995, by
MORRISON RESTAURANTS INC. (the "Primary Sponsor"), a corporation organized and
existing under the laws of the State of Delaware;
W I T N E S S E T H:
WHEREAS, the Primary Sponsor maintains the Morrison Restaurants Inc.
Salary Deferral Plan (the "Plan"), which was established by indenture dated
June 1, 1968 and which was last amended and restated by indenture dated
December 31, 1993; and
WHEREAS, the Primary Sponsor now desires to amend the Plan to facilitate
investment transactions effected pursuant to the terms of the Plan and for
other reasons;
NOW, THEREFORE, the Plan is hereby amended, effective as of the date
first set forth above, as follows:
1. By deleting the second sentence of Section 1.1(b).
2. By deleting existing Section 1.2 and by substituting therefor the
following:
" 1.2 Accrued Benefit" means the balance of a Member's
Account as of any given date.
3. By adding a new final sentence to Section 1.26(e) as follows:
The Plan Administrator shall also credit Hours of Service required
by any other applicable federal law, such as the Family and
Medical Leave Act of 1993 and the Uniformed Services Employment
and Reemployment Rights Act of 1994.
4. By substituting in Section 1.40 for the term "Individual Fund" the term
"Investment Fund" each time the former appears therein.
5. By deleting the existing provisions of Section 4.2 and by substituting
therefor the following:
4.2 As of each Valuation Date, as set forth in the Trust,
the Trustee shall determine the net income or net loss of Fund or
each Investment Fund which comprise the Fund, as the case may be.
The net income or net loss so determined shall be allocated as of
each Valuation Date to the Account of each Member in the
proportion that the balance of the Member's Account invested in
the Fund, or each Investment Fund, as the case may be, as of the
immediately preceding Valuation Date bears to the total value of
all Members' Accounts invested in the Fund, or that Investment
Fund, as of the immediately preceding Valuation Date.
6. By deleting the last sentence of Section 5.1 and by substituting
therefor the following:
Any request for a distribution under this Section must be made in
the manner prescribed by the Plan Administrator.
7. By deleting Section 7.2 in its entirety and by substituting therefore the
following:
7.2 The payment of a Member's Accrued Benefit shall be in
the form of one lump sum in cash. If the Member's interest in the
Morrison Stock Fund (as defined in the Trust) equals or exceeds
the value of one hundred (100) shares of Company Stock, that
interest may be distributed in the form of whole shares of Company
Stock if the Member so elects in such form as the Plan
Administrator may prescribe.
Except as specifically amended hereby, the Plan shall remain in full
force and effect as prior to this Second Amendment.
IN WITNESS WHEREOF, the Primary Sponsor has caused this Second Amendment
to be executed as of the day and year first above written.
MORRISON RESTAURANTS INC.
By: /s/ Samuel E. Beall
Title: Chairman and CEO
ATTEST:
/s/ Pfilip G. Hunt
Title: Secretary
[CORPORATE SEAL]
TRUST AGREEMENT
TO THE
MORRISON RESTAURANTS INC.
SALARY DEFERRAL PLAN
THIS TRUST AGREEMENT made as of the 31 day of December, 1993, by and
between MORRISON RESTAURANTS INC., f/k/a/ Morrison Incorporated, a corporation
organized and existing under the laws of the State of Delaware (the "Primary
Sponsor"); each other Affiliate or other entity adopting the Morrison
Restaurants Inc. Salary Deferral Plan (the "Plan"), as provided therein and
executing this trust pursuant thereto; and AMSOUTH BANK N.A. of Birmingham,
Alabama (the "Trustee");
W I T N E S S E T H:
WHEREAS, the Primary Sponsor maintains the Plan and related trust (the
"Trust"), which is intended to qualify as a profit sharing plan under section
401(a) of the Internal Revenue Code and also contains a cash or deferred
arrangement as described in Section 401(k) of the Internal Revenue Code, for
the exclusive benefit of Members thereunder and their Beneficiaries;
WHEREAS, the Primary Sponsor and Trustee previously entered into certain
trust agreements reflecting the terms of the Trust, the most recent of which
was dated December 29, 1989 (the "Prior Trust Agreement");
WHEREAS, the Primary Sponsor has restated the Plan, generally effective
January 1, 1989; and
WHEREAS, the Primary Sponsor and Trustee desire to restate the Prior
Trust Agreement to make conforming amendments;
NOW, THEREFORE, in consideration of the foregoing and of the further
obligations and undertakings as hereinafter set forth, the Primary Sponsor and
Trustee hereby amend and restate the Prior Trust Agreement, effective January
1, 1994, as follows:
SECTION I.
DEFINITIONS
All terms and definitions contained in the Plan are hereby incorporated
in the Trust Agreement by reference except to the extent that the terms of the
Trust Agreement clearly indicate to the contrary.
SECTION II.
THE FUND
The Primary Sponsor hereby establishes the Fund with the Trustee. The
Fund shall be held, managed and administered by the Trustee in trust in
accordance with the provisions of the Plan and of the Trust without
distinction between principal and income. At no time shall any part of the
Fund be used for or diverted to purposes other than the exclusive benefit of
the Members or their Beneficiaries, subject, however, to the payment of taxes
and administrative expenses and to the return of contributions to a Plan
Sponsor under the specific conditions set forth in the Plan.
SECTION III.
MAINTENANCE OF AND DISTRIBUTIONS FROM ACCOUNTS
A. The Plan Administrator shall maintain Accounts in accordance with
the Plan.
B. The Trustee may rely upon a notice given in accordance with the
terms of the Plan. The Trustee shall not be charged with any notice unless
given in accordance with the Plan, including notification of any changes in
the identity or authority of any Fiduciary (other than the Trustee) or any
other person acting in regard to the Plan.
C. The Trustee shall make payments out of the Fund to the persons,
in the manner and in the amounts specified in written directions received by
it from the Plan Administrator. The Plan Administrator assumes all
responsibility with respect to the directions and the application of the
payments. The Trustee is under no duty to enforce payments of any
contributions to the Fund and is not responsible for the adequacy of the Fund
to discharge liabilities arising in connection with the Plan or Trust.
D. If any dispute arises as to the persons to whom the payment of any
funds or delivery of any assets shall be made by the Trustee, the Trustee may
withhold the payment or delivery until the dispute has been determined by a
court of competent jurisdiction or has been settled by the parties concerned
and may, in its sole discretion, submit the dispute to a court of competent
jurisdiction.
SECTION IV.
INVESTMENTS
A. Subject to the provisions of Sections V, VI and VIII hereof, the
Trustee agrees to invest the assets of the Fund with the care, skill and
diligence under the circumstances then prevailing that a prudent man acting
in like capacity and familiar with such matters pursuant to the Trust would
use in the conduct of an enterprise of a like character and with like aims.
B. Subject to the terms of the Plan and the Trust Agreement and the
provisions of ERISA, the Trustee shall invest the principal and income of the
Fund without distinction between principal and income, in such securities or
in such property, real, personal, or mixed and wherever situated, as the
Trustee in its sole discretion deems advisable. Without limiting the
foregoing, the Trustee may make investments in, and may purchase, acquire,
obtain, retain, sell, transfer, pledge, hypothecate or encumber common or
preferred stocks, shares of mutual funds, trust and participation
certificates, bonds and mortgages, other evidences of indebtedness or
ownership, annuity contracts of life insurance companies, savings accounts or
plans, including, without limitation, savings accounts or plans established
by the Trustee, covered call options, put options, and financial futures
contracts, irrespective of whether the securities or property shall be of a
character authorized by applicable state law for trust investments.
C. The Trustee shall not invest in any securities issued by a Plan
Sponsor or any affiliate (as defined in ERISA Section 407(d)(7)) of a Plan
Sponsor unless the securities are "Qualifying Employer Securities," which
means (i) securities of a Plan Sponsor or any affiliate which are stock, or
(ii) a marketable obligation, as defined in ERISA Section 407(e), of a Plan
Sponsor or any affiliate. Also, the Trustee shall not invest in any real
property leased to or used by a Plan Sponsor or any affiliate of a Plan
Sponsor unless the real property is "Qualifying Employer Real Property," which
means parcels of real property and related personal property which are leased
to the Plan Sponsor or to any affiliate and which are geographically dispersed
and are suitable (or adaptable without excessive cost) for more than one use.
The Trustee may invest up to one hundred percent (100%) of the Fund in
Qualifying Employer Securities, but shall not be required to invest in either
Qualifying Employer Securities or Qualifying Employer Real Property if the
Trustee makes a good faith determination that the investment would be contrary
to ERISA or the Code.
D. In addition to any other investments proper under the Trust, the
Trustee shall, after receiving written approval from the Primary Sponsor, from
time to time invest all or any part of the Fund in one or more group trusts
or collective investment funds (including, without limitation, such trusts or
funds now or hereafter established by the then Trustee and, more specifically,
the AmSouth Bancorporation Collective Investment Trust and the funds
maintained thereunder, including the General Equity Fund, the General Fixed
Income Fund, the General Intermediate Maturity Fund, the General Limited
Maturity Fund, and the Short-Term Investment Fund and the AmSouth Master Money
Market Account of AmSouth Bank N.A.) which contemplate the commingling for
investment purposes of the funds therein with trust assets of other pension
plans as defined in ERISA which are qualified under Code Section 401 and which
may be established by other businesses, institutions and organizations other
than the Trustee. To the extent required by Revenue Ruling 81-100 and to the
extent consistent with the Trust, the terms and provisions of the declaration
of trust creating any group trust or collective investment fund in which the
Fund is invested are hereby adopted and made a part hereof, and any part of
the Fund so invested shall be subject to all of the terms and provisions of
any declaration of trust creating the group trust or collective investment
fund. The Trustee shall from time to time withdraw from the group trust or
collective investment fund such part of the Fund, as the Primary Sponsor
directs.
E. The Trustee shall invest the assets of the Plan allocated to
Company Matching Accounts primarily in shares of Qualifying Employer
Securities; otherwise, the normal investment goals and objectives of the
Trustee are capital growth, conservation of principal and production of income
through the receipt of interest or dividends from investments.
SECTION V.
INVESTMENT MANAGER
A. If an Investment Manager is designated in accordance with the
Plan, the Trustee shall either (1) turn over to the Investment Manager for
investment all or such portion of the Fund as is specified in a written
direction to the Trustee from the Primary Sponsor, in which case the assets
shall continue to be a part of the Fund, even though not in the Trustee's
possession, or (2) invest and reinvest all or such portion of the Fund as is
specified in a written direction to the Trustee from the Primary Sponsor in
the manner in which the Investment Manager directs the Trustee in writing.
In either event, whether the Trustee actually gives the Investment Manager
possession of a portion of the Fund or is required to invest a portion of the
Fund as directed by the Investment Manager, the Trustee shall have no
discretion with respect to the investment or reinvestment of that portion of
the Fund and shall not be liable for that portion of the Fund or for any acts
or omissions of the Investment Manager or for following or for taking or
refraining from taking any action at any direction of the Investment Manager
given prior to receipt by the Trustee of written notice from the Primary
Sponsor of revocation of the designation of the Investment Manager or for the
failure of the Investment Manager to give a direction or for any act or
omission in connection with its failure. The Trustee shall have no
responsibility for any assets of the Fund while in the possession of the
Investment Manager or while the assets have not been returned to the
possession of the Trustee, and the Trustee shall be entitled to rely upon
notice of the designation of an Investment Manager from the Primary Sponsor
until notified in writing by the designating party that the designation is no
longer in effect.
B. During any period of time in which an Investment Manager directs
the investment of a portion of the Fund, the Trustee, or its designated agent,
shall continue to receive all securities purchased against payment therefor
and to deliver all securities sold against receipt of the proceeds therefrom.
Any Investment Manager authorized to direct investments may issue orders on
behalf of the Trustee for the purchase or sale of securities directly to a
broker or dealer and for such purpose the Trustee shall, upon request, execute
and deliver to the Investment Manager one or more trading authorizations.
Written notification of the issuance of each order shall be given promptly to
the Trustee by the Investment Manager and the execution of each order shall
be confirmed by the broker to the Investment Manager and the Trustee. The
notification shall be authority of the Trustee to receive securities purchased
against payment therefor and to deliver securities sold against receipt of the
proceeds therefrom. All directions concerning investments of the Investment
Manager shall be signed by any person acting on behalf of the Investment
Manager as may be duly authorized in writing. The transmission by the Invest-
ment Manager to the Trustee of directions by photostatic teletransmission with
duplicate or facsimile signatures shall be considered a delivery in writing
of the directions until the Trustee is notified in writing by the Primary
Sponsor that the use of any device transmitting duplicate or facsimile
signatures is no longer authorized. The Trustee may rely upon directions
which it receives by photostatic teletransmission prior to receipt of notice
from the Primary Sponsor that they are no longer authorized, and the Trustee
shall not be responsible for the consequences of any unauthorized use of a
device which use was not known by the Trustee at the time to be unauthorized.
C. The Trustee shall be under no duty to make any review of
investments acquired for the Plan at the direction or order of an Investment
Manager or to make any recommendation with respect to disposing of or
continuing to retain any such investment.
D. The Trustee shall have no obligation to determine the existence
of any conversion, redemption, exchange, subscription or other right relating
to any securities purchased, of which notice was given prior to the purchase
of the securities, and shall have no obligation to exercise any right unless
the Trustee is informed of its existence by the Investment Manager and is
requested in writing by the Investment Manager to exercise the right within
a reasonable time before the time for its exercise expires.
E. In the event that the Trustee is directed to purchase securities
issued by any foreign government or agency thereof, or by any corporation
domiciled outside of the continental limits of the United States or its
territories, it shall be the responsibility of the Investment Manager to
advise the Trustee in writing with respect to any laws or regulations of any
such foreign countries which shall apply to the securities, including, but not
limited to, receipt of dividends or interest by the Trustee from such
securities.
SECTION VI.
INVESTMENT COMMITTEE
A. If an Investment Committee is designated by the Primary Sponsor
in accordance with the Plan, the Trustee shall, unless the Primary Sponsor
otherwise directs the Trustee in writing, invest the Fund as the Investment
Committee directs. However, the Trustee shall only be subject to proper
directions of the Investment Committee which are made in accordance with the
terms of the Plan and which are not contrary to ERISA.
B. The Primary Sponsor may in writing direct that only a portion of
the Fund shall be invested as the Investment Committee directs, in which case
the Trustee shall invest the balance of the Fund pursuant to Section IV
hereof, subject to Sections V and VIII hereof.
SECTION VII.
TRUSTEE POWERS
In the administration of the Trust, in addition to, and not in
limitation of, any powers or authority of the Trustee under the Trust or which
the Trustee may have under applicable law in addition thereto (all such
additional powers and authority being specifically hereby granted to the
Trustee), the Trustee is authorized and empowered to do the following, without
advertisement and without order of court and without having to post bond or
make any returns or report of its doings to any court:
A. To purchase or subscribe for any securities or property,
including, without limitation, shares of mutual funds and to retain the same
in trust;
B. To sell, exchange, convey, transfer, or otherwise dispose of, any
securities or property held by it, by private contract or at public auction,
with or without advertising, and no person dealing with the Trustee shall be
bound to see to the application of the purchase money or to inquire into the
validity, expediency or propriety of any sale or other disposition;
C. To vote any stocks, bonds or other securities; to give general or
special proxies or powers of attorney with or without power of substitution;
to exercise any conversion privileges, subscription rights or other options,
and to make any payments incidental thereto; to oppose or to consent to, or
otherwise participate in, corporate reorganizations or other changes affecting
corporate securities, and to delegate discretionary powers, and to pay any
assessments or charges in connection therewith; and generally to exercise any
of the powers of an owner with respect to stocks, bonds, securities or other
property held as part of the Fund; provided, however, that the voting,
tendering or similar rights with respect to any Qualifying Employer Securities
which are subject to investment direction by Members shall be exercised by
Members or, where applicable, their Beneficiaries;
D. To register any investment held as a part of the Fund in its own
name or in the name of a nominee, and to hold any investment in bearer form
or through or by a central clearing corporation maintained by institutions
active in the national securities markets, but the books and records of the
Trustee shall at all times show that all investments are part of the Fund;
E. To write covered call options and to purchase or sell put options
and financial futures contracts;
F. To employ and act through suitable agents, accountants, appraisers
and attorneys (who may be counsel for the Trustee) and to pay their reasonable
expenses and compensation, and the Trustee may consult with counsel (who,
without limitation, may be counsel to the Trustee or to a Plan Sponsor), and
shall be protected to the extent the law permits in acting upon the advice of
counsel in regard to legal questions, and may also employ agents and expert
assistants and delegate to them the ministerial duties which it sees fit, in
which event the Trustee shall periodically review the performance of the
persons to whom these duties have been delegated;
G. To borrow or raise money for the purposes of the Trust in such
amounts and upon such terms and conditions as the Trustee in its absolute
discretion may deem advisable; and for any sums so borrowed to issue its
promissory note as Trustee, and to secure the repayment thereof by pledging
all or any part of the Fund; and no person lending money to the Trustee shall
be bound to see to the application of the money lent or to inquire into the
validity, expediency or propriety of the borrowing;
H. To make, execute, acknowledge and deliver any and all documents
of transfer and conveyance and all other instruments or agreements that may
be necessary or appropriate to carry out the powers of the Trustee under the
Trust or incidental thereto;
I. To settle, compromise or submit to arbitration any claims, debts
or damages due or owing to or from the Fund, to commence or defend any legal
or administrative proceedings arising, necessary or appropriate in connection
with the Plan, the Trust, the Fund, the administration thereof or the powers
or authority of the Trustee under the Trust, and to represent the Plan, the
Trust, and the Fund in all legal and administrative proceedings;
J. To keep such portions of the Fund in cash or cash balances as the
Trustee may deem to be in the best interest of the Trust, it being understood
that the Trustee shall not be required to pay any interest on any cash
balances; and
K. Generally, to do all acts and to execute and deliver all
instruments as in the judgment of the Trustee may be necessary or desirable
to carry out any powers or authority of the Trustee, without advertisement,
without order of court and without having to post bond or make any returns or
report of its doings to any court.
SECTION VIII.
INVESTMENT FUNDS
A. The assets of the Fund shall be invested in at least four (4)
Individual Funds, with varying investment objectives, as the Primary Sponsor
shall from time to time determine with consent of the Trustee. One such
Individual Fund shall be established for investments in Qualifying Employee
Securities.
B. The Primary Sponsor, in its sole discretion may, from time to
time, establish one or more additional Individual Funds, or may change or
terminate the availability of any then existing Individual Fund or Individual
Funds for all Members, provided, however, that four (4) or more Individual
Funds remain available.
C. As to each of the Individual Funds, the Trustee shall be
authorized to purchase short-term investments pending the selection and
purchase of investments suitable for a particular Individual Fund. The
decision of the Trustee as to whether or not an investment is of a type which
may be purchased for any Individual Fund shall be conclusive. Pending the
selection and purchase of suitable investments, or the payment of expenses or
other anticipated distributions, the Trustee may retain in cash, without
liability for interest, such portion of an Individual Fund as it shall deem
reasonable under the circumstances.
D. The Trustee, at any time, may purchase for an Individual Fund any
property of another Individual Fund which would then be appropriate for
purchase by that Individual Fund and may exchange property of one Individual
Fund for property of another Individual Fund if the exchanged properties would
be appropriate for purchase by the respective Individual Funds. Each purchase
or exchange shall be made at the fair market value of the property so
purchased or exchanged.
E. The terms and provisions of this Section shall not in any way
limit the authority, powers, and duties of the Trustee as set forth in this
Trust except to the extent that Section 404(c) of ERISA applies to the
investment election made by any Member pursuant to the Plan and Trust. The
Trustee shall exercise or perform the same in regard to any Individual Fund
only in accordance with the purposes thereof. Further, the authority, powers,
and duties of the Trustee shall be subject to the limitations provided in
Sections V and VI of the Trust if an Investment Manager or an Investment
Committee is appointed as provided therein, which Investment Manager or
Investment Committee may be appointed in respect of all or a part of any In-
dividual Fund or the Fund, but shall exercise or perform its authority,
powers, and duties only in a manner consistent with the purpose of the
Individual Fund or the Fund, as the case may be.
SECTION IX.
INVESTMENT DIRECTION BY MEMBERS
A. Subject to any other rules and restrictions as the Plan
Administrator may prescribe from time to time, with respect to amounts
allocated to Employee Deferred Accounts and Rollover Accounts only, each
Member may (1) direct that a portion or all of his interest in one or more of
the Individual Funds be transferred to one or more of the other Individual
Funds or (2) change his election as to the Individual Funds in which future
contributions on his behalf to his Employee Deferred Account and Rollover
Account shall be invested. The provisions of this Section are contingent upon
the availability of transfers among the Individual Funds under the terms of
the investments made by each Individual Fund. An investment direction, once
given, shall be deemed to be a continuing direction until changed as otherwise
provided herein.
B. If no investment election is outstanding, all such contributions
shall be allocated to such Individual Fund as the Plan Administrator shall,
in its sole discretion, determine.
C. Investment directions by Members shall be subject to the
following:
1. Each direction shall be on a form provided by the Plan
Administrator, shall state the Individual Fund(s) to which all or a
portion of the Member's Account shall be transferred, or, if applicable,
shall state how future contributions shall be invested among the
Individual Funds.
2. Directions may be given effect for the immediately succeeding
Valuation Date occurring after written notice is given if delivered to
the Plan Administrator on or before the date required by the Plan
Administrator. Directions shall be effective only for the date in
respect of which they are given, unless the Plan Administrator allows
otherwise.
D. Each direction under the preceding paragraphs received by the Plan
Administrator shall be promptly delivered to the Trustee, and shall be
effective as to the Trustee only when received by the Trustee. If a Member
directs that all or a portion of his Account be invested in a particular
Individual Fund, the Trustee shall use its best efforts to carry out the
investment as soon as practicable. However, the Trustee shall never be held
liable fo2r failure to carry out an investment direction within the terms of
the Trust if the Trustee has made a bona fide effort to follow the direction.
E. Any distribution to a Member pursuant to the Plan shall be pro
rata from each Individual Fund in which he has an interest or in such other
manner determined by the Plan Administrator and applied uniformly.
SECTION X
VALUATION AND ALLOCATION
A. For all purposes under the Plan and the Trust, including
particularly, but without limitation, valuing the Fund and each Member's
Account and allocating to each Member's Account its share of the net income
or net loss of the Fund, the following rules shall apply:
1. Transfers or payments of funds or assets and the income,
gain, loss, or expenses attributable thereto between Individual Funds
shall be deemed made as of the Valuation Date coinciding with or
immediately preceding the actual date of transfer or payment and the
funds or assets shall not be credited or charged after such date with
any earnings or losses of the Individual Fund from which transferred or
paid but shall be credited or charged after such date with any earnings
or losses of the Individual Fund to which transferred or paid.
2. Transfers or payments from an Individual Fund to a Member or
his Beneficiary between Valuation Dates shall be charged against the
interest of the Member in the Individual Fund as of the next preceding
Valuation Date and contributions to an Individual Fund which are
allocated to the Account of a Member between Valuation Dates shall be
credited to the interest of such Member in such Individual Fund as of
the next succeeding Valuation Date.
3. Fair market value of the assets of each Individual Fund shall
be determined separately and the net income or net loss of each
Individual Fund shall be determined separately.
4. The value of a Member's Account, to the extent invested in
Individual Funds, shall be the sum of his proportionate interests in
each of the Individual Funds, and the aggregate net income or net loss
allocated to a Member's Account shall be the aggregate of the net income
or net loss allocated to his proportionate interests in each of the
Individual Funds.
B. Subject to the provisions of Subsections C. and D. below, the
Trustee shall as of each Valuation Date, and at such additional times as the
Primary Sponsor may in writing direct, determine the net income or net loss
and the fair market value of the assets in the Fund and each Individual Fund,
respectively, as determined below:
1. To the cash income, if any, since the last Valuation Date,
there shall be added or subtracted, as the case may be, any net increase
or decrease, since the last Valuation Date, in the fair market value of
the assets of the Fund or Individual Fund, as applicable, since the last
Valuation Date, any gain or loss on the sale or exchange of assets of
the Fund or Individual Fund, as applicable, since the last Valuation
Date, accrued interest since the last Valuation Date with respect to any
interest-bearing security as to which the purchaser would be required
to pay the accrued interest in addition to the quoted price, the amount
of any dividend which shall have been declared since the last Valuation
Date but not paid on shares of stock owned by the Trustee if the market
quotation used in determining the value of such shares is ex-dividend,
and the amount of any other assets of the Fund or Individual Fund
determined by the Trustee to be income since the last Valuation date;
2. From the sum thereof there shall be deducted all charges,
expenses, and liabilities accrued since the last Valuation Date which
are proper under the provisions of the Plan and the Trust and which in
the discretion of the Trustee are properly chargeable against income for
the period.
C. Notwithstanding Subsection B hereof, in the event that an
Investment Manager is designated by the Primary Sponsor and if the Investment
Manager either directs the investment of or itself invests any assets of the
Fund, or in the event that an Investment Committee is appointed by the Primary
Sponsor and directs the investment of any assets of the Fund, and if any of
such assets are non-listed securities or are not publicly traded or if the
fair market value of any of such assets cannot be readily determined, then the
Investment Manager or the Investment Committee, whichever is applicable, shall
determine the net income or net loss and the fair market value of such assets
and the Trustee shall be entitled to rely upon such determination.
D. In the event that an Investment Manager is designated by the Plan
Sponsor and if the Trustee gives the Investment Manager possession of any
portion of the assets of the Fund, then the Investment Manager shall determine
the net income or net loss and the fair market value of those assets and the
Trustee shall be entitled to rely upon the determination.
SECTION XI.
TRUSTEE COMPENSATION
A. The Trustee's compensation shall be the amount agreed upon in a
separate written agreement between the Primary Sponsor and the Trustee. If
the Primary Sponsor fails to pay to the Trustee its compensation and expenses
within thirty (30) days after the Trustee presents its invoice to the Primary
Sponsor, the Trustee is authorized to use the assets held by it under the
Trust to pay its unpaid compensation and expenses. No person who serves as
the Trustee and who receives full-time pay from a Plan Sponsor shall be
entitled to receive any compensation from the Fund, except for the
reimbursement of expenses properly and actually incurred by him in his role
as Trustee.
B. All taxes of whatever kind or nature that may be levied or
assessed under existing or future laws upon, or in respect of, the Plan, the
Trust, the Fund or the income or gains thereof or therefrom shall be paid from
the Fund.
SECTION XII.
TRUSTEE RESPONSIBILITY
The Trustee is not responsible for the application, investment or other
disposition of any funds or property held or managed by, or otherwise subject
to direction by, any person other than the Trustee. The Trustee is not
responsible for the application of any funds or property held by it under the
Trust which have been paid to the Plan Administrator or which have been paid
pursuant to the Plan and Trust or as directed by the Plan Administrator. The
Trustee has no responsibility with respect to any administration of the Plan
or the payment of any benefits under the Plan.
SECTION XIII.
RECORDKEEPING
The Trustee shall keep accurate and detailed accounts of all
investments, receipts, disbursements and other transactions pursuant to the
Plan and the Trust, and all books and records relating thereto shall be open
to inspection and audit at all reasonable times by the Plan Administrator.
Within ninety (90) days following the later of the close of each Plan year or
the receipt of a Plan Sponsor's contribution, and within ninety (90) days
after a Report Date (which for purposes of this Trust shall mean the date of
the death, removal or resignation of any Trustee from time to time serving
hereunder, or the date of the termination of the Trust) the Trustee shall file
with the Plan Administrator its written account. The account shall set forth
(i) all investments, receipts, disbursements and other transactions effected
by it during such Plan Year or during the period from the last Valuation Date
to the Report Date and (ii) the determination of the Trustee of the net income
or net loss of the Fund for such Plan Year or during the period from the last
Valuation Date to the Report Date and the determination of the Trustee of the
fair market value of the assets of the Fund as at the Valuation Date or as at
the Report Date, as the case may be. Unless a Report Date is also a Valuation
Date, no allocation of earnings, gains or losses shall be made to a Member's
Account.
SECTION XIV.
REMOVAL OR RESIGNATION OF TRUSTEE,
AND AMENDMENT OR TERMINATION OF TRUST
A. The Trustee, or an individual Trustee, as applicable, may be
removed by the Primary Sponsor at any time upon thirty (30) days' notice in
writing to the Trustee and the Plan Administrator. Any Trustee serving
hereunder may resign at any time without leave of court, upon thirty (30)
days' notice in writing to the Plan Sponsor and the Plan Administrator.
B. Upon the death, removal or resignation of a Trustee, the Primary
Sponsor shall appoint a successor Trustee as soon as possible. If the former
Trustee was one of several Trustees, the remaining persons constituting the
Trustee may continue to act as Trustee until the Primary Sponsor appoints a
successor co-Trustee.
C. Any removal of a Trustee or appointment of a successor Trustee
shall be without leave of court by notice in writing signed by the Primary
Sponsor and delivered to the Trustee being removed or appointed, with a copy
to the Plan Administrator. Any successor Trustee serving at any time
hereunder shall serve with the same powers and duties as the Trustee named
herein.
D. Upon receipt by the Trustee (or by the Primary Sponsor in the
event of the death of a last remaining individual Trustee) of the designated
successor's acceptance of its appointment as successor Trustee hereunder, the
funds and properties then constituting the Fund shall be transferred to the
successor Trustee. However, the Trustee is not required to transfer funds and
properties to a successor trustee unless the Trustee is discharged from all
liability for any taxes which may be due and owing by the Plan and Trust, or
unless either (1) the successor trustee, who must be acceptable to the
Trustee, indemnifies the Trustee against any such liability or (2) each Plan
Sponsor so indemnifies the Trustee in a manner acceptable to the Trustee.
E. If the Primary Sponsor fails to appoint a successor trustee before
the expiration of the thirty (30) day notice period, or no written acceptance
is received from a successor Trustee, then at any time after the end of the
thirty (30) day notice period the Trustee may file an appropriate action in
a court of competent jurisdiction and assign to the custody of the court the
funds and properties then held by the Trustee constituting the Fund.
F. Upon the transfer of the Fund to a successor trustee or to a court
of competent jurisdiction, as the case may be, the Trustee shall be relieved
of all further responsibilities in connection with the Plan, the Trust or the
Fund. The Trustee is authorized, however, to reserve therefrom such money or
property as it may deem advisable for payment of its fees and expenses in
connection with the settlement of its account or otherwise, and any balance
of the reserve remaining after the payment of such fees and expenses shall be
paid over to the successor trustee or to the court.
G. The Primary Sponsor reserves the right to amend this Trust
Agreement by written notice to the Trustee. However, no amendment which
affects the rights, duties or responsibilities of the Trustee may be made
without the Trustee's consent.
H. The Trust shall continue for such time as may be necessary to
accomplish the purposes for which it was created and shall terminate only upon
the complete distribution of the Fund. The Trust may be terminated as of any
date by the Primary Sponsor by written notice to the Trustee and the Plan
Administrator given in the manner prescribed in the Plan which specifies the
date as of which the Trust shall terminate. Upon termination of the Trust,
if the Trustee has not received instructions to the contrary from the Primary
Sponsor, the Trustee shall liquidate the Fund and, after paying the reasonable
expenses of the Trust, including expenses involved in the termination,
distribute the balance thereof according to the written directions of the Plan
Administrator. The Trustee is not required to make any distribution until it
receives a copy of an Internal Revenue Service determination letter to the
effect that the termination does not affect either the qualified status of the
Plan or the exempt status of the Trust, or, if such letter is not issued,
until the Trustee is reasonably satisfied that adequate provision has been
made for the payment of all taxes which may be due and owing by the Trust.
In no event shall any distribution be made by the Trustee until the Trustee
is reasonably satisfied that the distribution will not be contrary to the
applicable provisions of the Plan dealing with terminations of the Plan and
the Trust.
I. The Trust and the contributions made by each Plan Sponsor to the
Trustee are conditioned upon the conditions set forth in the Plan as to
qualification and returns of contributions, and the returns of contributions
by the Trustee to the Plan Sponsors in certain events is governed by such
provisions of the Plan.
J. If at any time more than one person or entity is serving as the
Trustee, the persons or entities so serving shall act by the action of a
majority, with or without a meeting, and any action may be evidenced by a
writing executed by a majority of the persons or entities constituting the
Trustee.
K. Each Plan Sponsor agrees at its sole cost and expense to indemnify
and hold harmless the Trust and the Trustee from and against any claim,
liability, loss, cost, expense, action or cause of action resulting from or
in connection with any claim asserted by any person or persons where the
Trustee has acted in good faith pursuant to the Trust or in reliance on a
written notice to the extent the notice is authorized in the Plan or Trust and
has been given in accordance with the terms and conditions of the Plan.
L. The Trust shall be administered, construed and enforced according
to the laws of the State of Alabama to the extent not preempted by federal
laws, and the Trustee shall be liable to account only in the courts of that
state and in any court of appropriate jurisdiction of the United States of
America. All transfers of funds or other property to or from the Trustee
shall be deemed to take place in the State of Alabama.
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be executed on the day and year first above written.
PRIMARY SPONSOR:
MORRISON RESTAURANTS INC.
By: /s/ Samuel E. Beall
Title: President and Chief Executive
Officer
ATTEST:
/s/ Pfilip G. Hunt
Title: Senior Vice President,
General Counsel & Secretary
[CORPORATE SEAL]
TRUSTEE:
AMSOUTH BANK N.A.
By: /s/ Lynn E. Cushing
Title: Senior Vice President
ATTEST:
/s/ Donna P. Price
Title: Assistant Vice President
and Trust Officer
[SEAL]
FIRST AMENDMENT TO THE
MORRISON RESTAURANTS INC.
SALARY DEFERRAL PLAN
TRUST AGREEMENT
THIS FIRST AMENDMENT made on this 30th day of June , 1995, by and
between MORRISON RESTAURANTS INC. (the "Primary Sponsor"), a corporation
organized and existing under the laws of the State of Delaware; and AMSOUTH
BANK N.A. of Birmingham, Alabama (the "Trustee");
W I T N E S S E T H:
WHEREAS, the Primary Sponsor maintains the Morrison Restaurants Inc.
Salary Deferral Plan (the"Plan"), which was established by indenture dated
June 1, 1968 and which was last amended and restated by indenture dated
December 31, 1993;
WHEREAS, the Primary Sponsor established a trust as part of the Plan
(the"Trust") pursuant to which the Trustee currently serves as trustee; and
WHEREAS, the Primary Sponsor and the Trustee desire to amend the Trust
for the purpose of facilitating investment transactions effected pursuant to
the terms of the Plan;
NOW, THEREFORE, the Trust is hereby amended, effective as of the date
first set forth above, as follows:
1. By deleting the first sentence of Section III.C. and by
substituting therefor the following:
The Trustee shall make payments out of the Fund to the persons,
in the manner and in the amounts specified in directions received
by it from the Plan Administrator.
2. By deleting the last sentence of Section VIII.A. and by
substituting therefor the following:
"One such Individual Fund shall be established for investments in
Qualifying Employer Securities and shall be known as the 'Morrison
Stock Fund.'"
3. By deleting Section IX.C. in its entirety and by substituting
therefor the following:
C. Investment directions by Members to the Plan
Administrator shall be made in the manner and pursuant to rules
established by the Plan Administrator and shall indicate the
manner in which contributions are to be invested in, or the
allocation of a Member's Account among, the available Individual
Funds.
2. Directions provided to the Trustee shall remain
in effect until superseded by subsequent directions
provided by the Member.
Except as specifically amended hereby, the Trust shall remain in full
force and effect as prior to this First Amendment.
IN WITNESS WHEREOF, the Primary Sponsor and Trustee have caused this
First Amendment to be executed as of the day and year first above written.
MORRISON RESTAURANTS INC.
By:/s/ Samuel E. Beall
Title: Chairman and CEO
ATTEST:
/s/ Pfilip G. Hunt
Title: Secretary
[CORPORATE SEAL]
AMSOUTH BANK N.A.
By:/s/ Katherine W. Davidson
Title: Senior Vice President
and Trust Officer
ATTEST:
`/s/ Tracy D. Crain
Title: Vice President and Trust Officer
[SEAL]
<TABLE>
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
EXHIBIT 11
COMPUTATION OF EARNINGS PER SHARE
(IN THOUSANDS EXCEPT PER-SHARE DATA)
<CAPTION>
Fiscal Year Ended
June 3, June 4, June 5,
1995 1994 1993
PRIMARY EARNINGS PER COMMON AND COMMON
EQUIVALENT SHARE
<S> <C> <C> <C>
Average common shares outstanding......... 34,642 35,973 37,029
Average additional common shares
issuable on exercise of dilutive
stock options (computed by use of
the "treaury stock method", at the
average market price)..................... 1,280 1,394 1,049
Number of shares used in computation of
primary earnings per share.............. 35,922 37,367 38,078
Net Income.............................. $62,171 $44,684 $37,975
Primary earnings per common and
common equivalent share................. $1.73 $1.20 $1.00
</TABLE>
<TABLE>
EXHIBIT 11 (continued)
<CAPTION>
Fiscal Year Ended
June 3, June 4, June 5,
1995 1994 1993
FULLY DILUTED EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARE
<S> <C> <C> <C> <C>
Average common shares outstanding......... 34,642 35,973 37,029
Average additional common shares issuable
on exercise of dilutive stock options
(computed by use of the "treasury stock
method", at the higher of period-end
or average market price)................ 1,328 1,415 1,122
Number of shares used in computation of
fully diluted earnings per share........ 35,970 37,388 38,151
Net Income.............................. $62,171 $44,684 $37,975
Fully diluted earnings per common and
common equivalent share................. $ 1.73 $ 1.20 $ 1.00
Weighted average shares and all per share data for prior years have been restated to
give effect to common stock dividends and common stock splits through June 4, 1994.
</TABLE>
<TABLE>
CONSOLIDATED FINANCIAL HIGHLIGHTS
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
(In thousands except per-share data)
<CAPTION>
Percent
June 3, June 4, Increase
For the Fiscal Year Ended 1995 1994 (Decrease)
<S> <C> <C> <C>
Revenues................................................$ 1,035,089 $ 1,213,389* (14.7)
Income Before Provision for Income Taxes................$ 104,712** $ 71,157 47.2
Provision for Federal and State Income Taxes............ 42,541 26,473 60.7
Net Income..............................................$ 62,171** $ 44,684 39.1
Earnings Per Common and Common
Equivalent Share......................................$ 1.73 $ 1.20 44.2
Cash Dividends Per Share of Common Stock............... $ 0.3458 $ 0.3299 4.8
At Year End
Total Assets..........................................$ 484,051 $ 408,453 18.5
Long-Term Debt........................................$ 52,095 $ 9,526 446.9
Stockholders' Equity..................................$ 245,493 $ 221,136 11.0
Working Capital.......................................$ (44,780) $ (43,007) (4.1)
* Includes the revenues of the education, business and industry (B&I)
contracts of the Morrison Group sold in August, 1994 or closed and the
revenues of the converted or closed L&N Seafood Grill (L&N) units of the Ruby
Tuesday Group prior to their conversion or closing.
** Includes the net gain from the B&I and L&N disposals.
</TABLE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
For an understanding of the significant factors that influenced
the Company's performance during the past three fiscal years,
the following discussion should be read in conjunction with the
Consolidated Financial Statements and related Notes found on
pages 36 to 48.
RESULTS OF OPERATIONS
Fiscal year 1995 marked the Company's fourth straight year
of record earnings. Excluding the net gain realized upon the
sale of certain education, business and industry (B&I)
contracts and assets of the Morrison Group, over the cost to
phase out the L&N Seafood Grill (L&N) concept of the Ruby
Tuesday Group, the earnings growth in fiscal 1995 was primarily
the result of the expansion of the Ruby Tuesday Group and the
growth and improved profitability of the Morrison Group.
During fiscal 1995, the Company continued the implementation of
the financial and business strategy approved by the Board of
Directors in March, 1994 which, among other things, requires
the Company to invest in high-growth businesses that can attain
a dominant market position in their respective categories. The
contribution that each Group made in fiscal 1995 is discussed
below.
During fiscal 1995, the Board of Directors approved a plan
to phase out the L&N concept. In addition, in August, 1994 the
Company sold certain B&I contracts and assets. While these
businesses generated in excess of $300.0 million of sales and
$7.0 million of operating profits in fiscal 1994, Management
believed that neither was likely to achieve dominance in its
respective category. In January, 1995, the Company acquired the
common stock of Tias, Inc.. The effects of these transactions
on fiscal 1995 results are also discussed below.
1995 Compared to 1994
Earnings per share were $1.73 in 1995 as compared to $1.20
in 1994. Net income was $62.2 million as compared to $44.7
million a year ago. In 1995 there was a charge of $19.7
million ($12.0 million after tax) due to the decision made by
the Board to phase out the L&N concept and a gain of $46.8
million ($25.8 million after tax) due to the sale or closing of
the B&I contracts and assets.
Ruby Tuesday Group
Ruby Tuesday Group sales for 1995 increased 12.1%. The
sales gain was 30.1% excluding L&N, which contributed sales of
$63.3 million in 1994. Included in the 1995 total are the
sales of Tia's, a chain of Tex-Mex/Southwestern restaurants,
which contributed $12.1 million in sales subsequent to its
acquisition in January, 1995. The increased sales reflect
expansion within the Group as well as an increase in same-store
sales for the Ruby Tuesday concept (the largest concept within
the Group), partially offset by a decrease in same- store sales
for the Mozzarella's concept. During fiscal 1995, the Company
opened 57 Ruby Tuesdays and 17 Mozzarella's. At the time of
the acquisition of Tias, Inc. there were 12 Tia's restaurants.
Two additional Tia's which had been under construction at the
time of the acquisition were also opened. Twenty-one of the
units opened during the year were converted L&N units. Five
Ruby Tuesdays and one Mozzarella's were closed during fiscal
1995.
Operating profit increased 20.9% for the Group. The
increase in operating profit is due to continued expansion
coupled with a 0.7% operating margin increase. Excluding L&N's
results from the 1994 amount, the operating margin decreased
0.7% in 1995. The operating margin decrease recognized by the
Group's continuing concepts is the result of the investment of
funds within the Ruby Tuesday concept for items such as
remodeling, customer service, and expanded advertising, and the
rapid expansion of the Mozzarella's concept, as well as the
acquisition of Tia's, which initially realized lower margins
than the Ruby Tuesday concept. The Group's plans call for
aggressive expansion of the Ruby Tuesday concept, both in the
traditional Eastern U.S. markets and in new markets in the
Western U.S. The Company estimates that over 50 Ruby Tuesdays
and 10 other specialty restaurants will be opened in fiscal
1996.
In fiscal 1995, the Company accrued approximately $19.7
million for costs to be incurred as a result of the decision
announced on June 27, 1994, to phase out the L&N concept. This
amount, originally accrued to cover the costs to convert 30 L&N
units and close the remaining eight, consisted primarily of the
following: losses on disposal of fixed assets net of
anticipated proceeds and the net cost of related lease
obligations for the units to be closed (approximately $11.6
million), expected operating losses during the phase out period
(approximately $4.8 million), severance pay (approximately $1.1
million) and other losses on the conversion of units,
consisting primarily of the write- off of fixed assets,
inventory, and unamortized cost in excess of net assets
acquired (approximately $2.2 million).
Subsequent to the June, 1994 announcement, the Company
reacquired three additional L&N units as a result of a default
on a licensing agreement. These three units were closed.
Based on favorable operating results, in the third quarter of
fiscal 1995, Management decided to continue to operate four of
the L&N units as L&N's through the remainder of their lease
terms. The sales and earnings of these four units have been
included in the operating results of the Ruby Tuesday Group
since the beginning of third quarter. During the year, 21 of
the L&N units have been converted and are operating as other
Ruby Tuesday Group restaurants. One additional unit was
converted and reopened as a Tia's shortly after year-end.
Another unit is in the process of being converted to a Tia's.
The remaining 11 units were closed.
As of June 3, 1995, $13.7 million of expenses related to
fiscal 1995 L&N operating losses, write-offs of inventories,
intangibles and other assets, severance pay and other expenses
had been charged against the reserve. The majority of the
remaining $6.0 million reserve relates to remaining asset
write-offs ($4.8 million) and costs anticipated to be incurred
to settle lease obligations on units closed ($1.2 million).
The Company is actively pursuing settlement of all lease
obligations and expects to make the necessary cash payments
early in fiscal 1996.
The Company anticipates that the L&N units which were
converted will operate at a similar or higher sales volume than
before conversion, with improved profits.
Morrison Group
On August 8, 1994, the Company sold certain B&I contracts
and assets of the Morrison Group to Gardner Merchant Food
Services, Inc., a wholly-owned subsidiary of Gardner Merchant
Ltd., for $100.0 million in cash. B&I accounts not sold were
subsequently closed. The sale, net of related transaction
expenses and closing costs of approximately $11.1 million,
resulted in a n2et pre-tax gain of $46.8 million.
Due to the sale of the B&I contracts and assets, sales in
the Morrison Group for 1995 decreased 31.1%. In 1994, B&I
contributed $250.7 million in sales. The sales gain for 1995
excluding B&I was 3.2%. This increase reflects the addition of
larger accounts in the Health Care Division and increased sales
from the Fresh Cooking Quick Service Restaurants (QSRs) and
Small Cafeterias offset by a 1.1% decline in same-store sales
in the Family Dining Division. The Group opened 14 new family
dining units during the fiscal year, consisting of three small
cafeterias, ten food-court QSRs, and one Snapp's, as well as
numerous contract dining accounts in the Health Care Division.
The Group closed two cafeterias and four Snapp's during the
fiscal year.
Operating profit decreased 1.0% from 1994. Excluding the
effect of B&I's 1994 operating profit of $7.3 million,
operating profit increased 18.2% in 1995 due to increased sales
and a 1.1% operating margin increase. The margin improvement is
largely attributable to the success of food-cost control
programs.
The Company's plans call for continued growth of the
Morrison Group during fiscal 1996 through the addition of
approximately nine Fresh Cooking units. The Group's plans also
call for accelerated growth in the healthcare food-service
market.
Net Interest Expense
Net interest expense increased from $51,000 in 1994 to
$950,000 in 1995 due to $50.0 million in borrowings under the
Company's revolving credit facility offset by the retirement of
the Life Insurance Co. of Georgia note of $12.0 million.
Income Tax Expense
The effective income tax rate increased to 40.6% in 1995
from 37.2% in 1994. Excluding B&I and L&N, the effective
income tax rate for 1995 and 1994 would have been 37.7% and
37.6%, respectively.
1994 Compared to 1993
Earnings per share were $1.20 in 1994 as compared to $1.00
in 1993. Net income was $44.7 million, an increase of $6.7
million from 1993. Fiscal year 1993 income included the
cumulative effect of adjustments due to new accounting
standards relating to postretirement benefits and income taxes.
The net effect on income of the adoption of the two standards
was a decrease of $0.2 million for fiscal 1993.
Ruby Tuesday Group
During fiscal 1994, the Company repositioned the former
Silver Spoon Cafe concept into Mozzarella's, an American cafe
with an Italian accent.
Sales and earnings increased in the Ruby Tuesday and
Mozzarella's concepts compared to fiscal 1993, while the L&N
Seafood Grill concept experienced sales and earnings declines.
Same-store sales for Ruby Tuesdays and Mozzarella's increased
in fiscal 1994, but decreased in the L&N Seafood Grills.
During fiscal 1994, 42 Ruby Tuesdays, four Mozzarella's, one
L&N Seafood Grill and three Snapp's were opened. These Snapp's
units were closed in fiscal 1995. There were four Ruby
Tuesdays and five L&N Seafood Grills closed during fiscal 1994.
Operating profit increased 14.5% for the Group due to
increased sales offset by a 0.5% operating margin decrease.
The operating margin decrease was the result of the shortfall
in performance of L&N and the development of the Snapp's
concept. Excluding the results of L&N , the Group's operating
profit increased 25.8%.
Morrison Group
During fiscal 1994, the Company combined the former
Hospitality Group, which serves the contract dining market,
with the Family Dining Group, which serves the cafeteria
market, to create the new Morrison Group. The contract dining
sector of this Group was further broken down based on market
focus into a Health Care Division for hospitals and healthcare
facilities and a Hospitality Division for schools, businesses
and industry. All data formerly reported for the two separate
Groups, Hospitality and Family Dining, is now reported as the
Morrison Group.
Sales in the Morrison Group increased 4.6% due to unit
expansion in the contract dining sector and an increase in the
number of customers in the family dining sector as a result of
strategic price rollbacks and bundled-meal promotions. The
Group opened ten new family dining concepts during fiscal year
1994, consisting of one small cafeteria and nine food-court
quick-service restaurants, as well as numerous contract dining
accounts. The Group closed nine cafeterias during the 1994
fiscal year.
Operating profit increased 22.4% for the Group due to
increased sales and a 0.9% operating margin increase. The
margin improvement resulted from increased customers and food
and labor cost controls.
Net Interest Expense
Net interest expense decreased 83.9% during fiscal 1994
due to the retirement of the Trust Company Bank note of $22.5
million during fiscal 1993 and increased capitalization of
interest charges due to an increase in the number of new units.
Income Tax Expense
The effective income tax rate decreased to 37.2% in fiscal
1994 from 37.3% in fiscal 1993 due to the tax credit for FICA
taxes paid on tips in excess of the minimum wage commencing
January, 1994 and also due to increased levels of targeted jobs
tax credit following the extension of the program in the
Omnibus Budget Reconciliation Act of 1993, offset by a 1%
increase in the corporate income tax rate, which went into
effect January 1, 1993, and an increase in the effective state
income tax rate.
LIQUIDITY AND CAPITAL RESOURCES
Cash Flow
Cash provided by operating activities was $58.0 million in
fiscal 1995, $73.4 million less than the amount used for
capital expenditures. Cash proceeds of $100.0 million were
realized from the B&I sale. In addition, $38.2 million of cash
was provided through incremental borrowings under the Company's
lines of credit. Pursuant to the Company's financial strategy
approved by the Board during fiscal 1994, $45.7 million and
$39.8 million of the Company's stock was reacquired during 1995
and 1994, respectively, from cash available after the Company's
investments in new units and food service contracts. Amounts
for both years include $2.3 million for stock acquired in
connection with the Company's Deferred Compensation Plan. See
the Consolidated Statements of Cash Flows on page 39 for more
information.
Capital Expenditures
Property and equipment expenditures for fiscal 1995 were
$131.4 million, 45.4% higher than the prior year. Of the total
expenditures, $108.4 million occurred within the Ruby Tuesday
Group. During 1995, 67 new Ruby Tuesday Group restaurants were
opened, including 12 units which were added upon the
acquisition of Tias, Inc. In addition, 21 L&N units were
converted to other Company concepts as a result of the phase
out of L&N. In the Morrison Group 14 cafeteria style units
(ten QSRs, three Small Cafeterias and one Snapp's) were opened.
Capital expenditures for fiscal 1996 are projected to be $158.2
million. Projected openings for fiscal year 1996 include
approximately 60 Ruby Tuesday Group restaurants and nine Fresh
Cooking units in the Morrison Group.
Borrowings and Credit Facilities
The Company had lines of credit with various banks
totaling $126.0 million at June 3, 1995. The Company utilized
these lines of credit with various financial institutions in
1995 to meet operational cash needs, including stock
repurchases. The Company had unused lines of credit totaling
$113.4 million at June 3, 1995, of which $19.4 million were
committed and $94.0 million were non-committed. In addition to
these lines of credit, the Company entered into a five-year
revolving line of credit with various banks which will allow
the Company to borrow up to $200.0 million over the next five
years. The Company had $50.0 million of borrowings outstanding
under this agreement at June 3, 1995 classified by the Company
as long-term debt. The credit facility provides for certain
restrictions on incurring additional indebtedness and to
certain funded debt, net worth, and fixed charge coverage
requirements. At June 3, 1995, retained earnings in the amount
of $39.4 million were available for cash dividends and stock
repurchases under the debt restrictions.
The Company entered into an interest rate swap agreement
to control its fiscal 1996 interest costs. This swap agreement
which has a notional amount accreting from $85.0 to $115.0
million effectively limits the interest rate to a maximum of
7.02% per annum for a one year period commencing June 5, 1995.
During fiscal 1996 the Company expects to fund operations
and capital expansion from operating cash flows, bank lines of
credit and its five-year revolving line of credit. See Note 7
of Notes to Consolidated Financial Statements for a detailed
discussion of borrowings and credit facilities. Long-term debt
increased a net $42.7 million in 1995 due to borrowings on the
revolving credit facility, offset by the early retirement of
the note payable to Life Insurance Company of Georgia. The
Company anticipates the need for additional borrowings on the
revolving line of credit of approximately $55.0 million in
fiscal year 1996.
Working Capital
Working capital and the current ratio as of June 3, 1995
were $(44.8) million and 0.6, respectively.
Dividends
Cash dividends paid to stockholders during 1995 equaled
$12.0 million ($.3458 per share). Management's financial
strategy, established in fiscal 1994, set forth a policy to
increase dividends per share by five percent annually, based on
achievement of targeted earnings growth.
Deferred Tax Assets
The recognition of deferred tax assets depends on the
anticipated existence of taxable income in future periods in
amounts sufficient to realize the assets. A valuation
allowance must be used to reduce the deferred tax asset if such
future income is not likely to be generated. Management
believes that future taxable income should be sufficient to
realize all of the Company's deferred tax assets based on the
historical earnings of the Company, and therefore, a valuation
allowance has not been established.
KNOWN EVENTS, UNCERTAINTIES AND TRENDS
Financial and Stock Repurchase Plans
The Board of Directors adopted, on March 30, 1994, a new
financial strategy that places more emphasis on debt management
and establishes a target capital structure which will utilize a
prudent amount of debt to minimize the weighted average cost of
capital while allowing the Company to maintain financial
flexibility and the equivalent of an investment-grade (BBB)
bond rating. This financial strategy sets a target debt-to-
capital ratio of 60%, including operating leases. The strategy
also provides for repurchasing Morrison stock whenever cash
flow exceeds funding requirements while maintaining the target
capital structure. Accordingly, the Board approved the
repurchase of up to an additional 2.5 million shares, bringing
the total authorized for repurchase to 4.6 million shares.
During 1995, the Company purchased 1.6 million shares at a
total purchase price of $43.4 million under its various stock
repurchase programs. As of June 3, 1995, 2.4 million shares
remained available for repurchase under the Company's stock
repurchase programs.
New Accounting Standards
In March, 1995, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards No. 121 (FAS
121), "Accounting for the Impairment of Long-Lived Assets and
for Long-Lived Assets to be Disposed Of". FAS 121 establishes
accounting standards that require an entity to review long-
lived assets and certain identifiable intangibles for
impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable.
Long-lived assets and certain identifiable intangibles to be
disposed of are generally to be reported at the lower of
carrying amount or fair value less cost to sell. The Company
is required to adopt FAS 121 in fiscal 1997. The Company does
not anticipate that FAS 121 will have a material impact on the
Company's financial position or results of operations.
Impact of Inflation
The Company has not experienced a significant overall
impact from inflation. Although the impact of inflation on the
cost of food, labor, real estate and construction can
significantly affect the Company's operations, the Company can
reduce this impact through increased menu prices to the extent
competitive pressures will permit.
Management's Outlook
The Company has made many significant advances to position
itself for strategic growth. In the Ruby Tuesday Group, Ruby
Tuesday, with its menu of burgers, ribs, fajitas, chicken,
soups, salads and sandwiches, will maintain its aggressive
posture. The Mozzarella's concept will follow a year of
aggressive expansion with a concentration primarily on improved
sales at existing units. The concept specializes in pizzas,
pastas, soups, salads and sandwiches, with a $9 average check.
Tia's, the Tex-Mex concept with freshly prepared menu items
which was acquired in fiscal 1995, offers the Company an
attractive opportunity to enter a high growth segment of the
industry. The Company's focus for Tia's is to expand from the
base acquired while maintaining the new unit sales volumes.
Management believes that it is positioned to take advantage of
growth opportunities well into the future.
In the Morrison Group, the Health Care Division has grown
dramatically in both profit and sales and the Company will
enhance its growth further through the expansion of the sales
team and maintenance of their outstanding performance. The
Group's Family Dining Division will continue with moderate
expansion of its Morrison's Fresh Cooking concept which
specializes in home-meal replacement highlighting fresh,
wholesome chicken and vegetables. The sale of B&I's
contracts and assets and the phasing out of L&N are part of the
Company's strategy to invest in high-growth businesses that
have or can attain a dominant market position in their
respective categories. The Company will also focus on
accelerating the growth of its proven businesses, Ruby Tuesday
and Health Care, as well as its emerging businesses,
Mozzarella's, Tia's and Fresh Cooking. Management believes
that this realignment will strategically position the Company
to attain its growth and profitability objectives while
creating value for its stockholders, its customers and its
employees.
<TABLE>
SUMMARY OF OPERATIONS
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
(In thousands except per-share data)
<CAPTION>
Fiscal Year
1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C>
Revenues........................................ $ 1,035,089 $ 1,213,389 $ 1,099,845 $ 1,038,946 $ 970,530
============ ============ ============ ============ ==========
Income Before Provision for Income Taxes and
Cumulative Effect of Accounting Changes..... $ 104,712 $ 71,157 $ 60,884 $ 51,445 $ 42,453
Provision for Federal and State Income Taxes.... 42,541 26,473 22,725 18,774 15,825
------------ ------------ ------------ ----------- ----------
Income Before Cumulative Effect of
Accounting Changes............................ 62,171 44,684 38,159 32,671 26,628
Cumulative Effect of Accounting Changes, net:
Postretirement benefits....................... (2,579)
Income taxes.................................. 2,395
------------ ------------ ------------ ----------- ----------
Net Income...................................... $ 62,171 $ 44,684 $ 37,975 $ 32,671 $ 26,628
============ ============ ============ =========== ==========
Earnings Per Common and Common Equivalent Share:
Before Cumulative Effect of Accounting Changes. $1.73 $1.20 $1.01 $0.87 $0.71
Cumulative Effect of Accounting Changes, net:
Postretirement benefits...................... (0.07)
Income taxes................................. 0.06
------------ ------------ ----------- ---------- ---------
$1.73 $1.20 $1.00 $0.87 $0.71
============ ============ =========== ========== =========
Weighted average common and
common equivalent shares 35,922 37,367 38,078 37,435 37,310
All fiscal years are composed of 52 weeks except 1992 which contains 53 weeks.
Weighted average shares and all per-share data for years prior to 1994 have been restated from their original presentation to
give effect to 3-for-2 stock splits which occurred in fiscal years 1994 and 1992.
</TABLE>
<TABLE>
Other Financial Data:
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Total Assets.................................. $ 484,051 $ 408,453 $ 382,620 $ 369,732 $ 331,402
Long-Term Debt................................ $ 52,095 $ 9,526 $ 13,085 $ 35,919 $ 38,005
Stockholders' Equity.......................... $ 245,493 $ 221,136 $ 219,624 $ 203,577 $ 181,241
Cash Dividends Per Share of Common Stock...... $ 0.35 $ 0.33 $ 0.32 $ 0.29 $ 0.29
Working Capital............................... $ (44,780) $ (43,007) $ 1,906 $ 22,852 $ 12,028
Current Ratio................................. 0.6:1 0.6:1 1.0:1 1.3:1 1.2:1
</TABLE>
<TABLE>
GROUP INFORMATION
(In thousands)
<CAPTION>
Fiscal Year
1995 1994 1993
<S> <C> <C> <C>
Sales:
Ruby Tuesday Group............. $ 514,900 $ 395,895 $ 306,693
Morrison Group................. 519,777 503,688 498,751
Corporate and Other............ 412 (155) 49
1,035,089 899,428 805,493
L&N*........................... 63,300 71,950
B&I**.......................... 250,661 222,402
$1,035,089 $1,213,389 $1,099,845
Operating Profit:
Ruby Tuesday Group............. $ 47,152 $ 38,996 $ 30,993
Morrison Group................. 44,087 37,290 29,467
91,239 76,286 60,460
Corporate expenses............. (12,632) (12,325) (9,235)
Earnings Before Interest,
Taxes and Conversion or
Sale of Assets................ 78,607 63,961 51,225
Net interest expense........... (950) (51) (317)
Income Before Income Taxes and
Conversion or Sale of Assets.. 77,657 63,910 50,908
L&N*........................... (6) 3,063
B&I**.......................... 7,253 6,913
L&N conversion/closing costs... (19,727)
Net gain on sale/closure
of B&I accounts.............. 46,782
Income Before Provision for
Income Taxes and Cumulative
Effect of Accounting Changes.. 104,712 71,157 60,884
Income taxes................... 42,541 26,473 22,725
Income Before Cumulative
Effect of Accounting Changes.. 62,171 44,684 38,159
Cumulative Effect of
Accounting Changes, net:
Postretirement benefits..... (2,579)
Income taxes................ 2,395
Net Income...................... $ 62,171 $ 44,684 $ 37,975
Operating Profit Margins:
Ruby Tuesday Group............. 9.2% 9.9% 10.1%
Morrison Group................. 8.5% 7.4% 5.9%
Identifiable Total Assets:
Ruby Tuesday Group............. $ 310,224 $ 214,737 $ 166,700
Morrison Group................. 140,416 162,100 161,216
Corporate and Other............ 33,411 31,616 54,704
$ 484,051 $ 408,453 $ 382,620
Gross Expenditures for Property
and Equipment:
Ruby Tuesday Group............. $ 108,410 $ 69,252 $ 47,475
Morrison Group................. 22,157 20,150 15,213
Corporate and Other............ 789 928 298
$ 131,356 $ 90,330 $ 62,986
Depreciation and Amortization
Expense:
Ruby Tuesday Group............. $ 26,015 $ 22,645 $ 18,157
Morrison Group................. 12,443 16,346 16,658
Corporate and Other............ 691 780 634
$ 39,149 $ 39,771 $ 35,449
* Represents the results of the L&N units of the Ruby Tuesday Group which
were converted or closed.
** Represents the results of the education, business and industry (B&I)
contracts of the Morrison Group which were sold or closed.
</TABLE>
<TABLE>
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED STATEMENTS OF INCOME
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
(In thousands except per-share data)
<CAPTION>
For the Fiscal Year Ended
June 3, June 4, June 5,
1995 1994 1993
<S> <C> <C> <C> <C>
Revenues:
Net sales and operating revenues................... $1,033,055 $1,209,625 $1,098,268
Other revenues..................................... 2,034 3,764 1,577
1,035,089 1,213,389 1,099,845
Operating Costs and Expenses:
Cost of merchandise................................ 299,394 378,103 352,043
Payroll and related costs.......................... 359,342 439,448 398,077
Other.............................................. 186,927 209,724 191,846
Selling, general and administrative................ 71,670 75,135 61,229
Depreciation and amortization...................... 39,149 39,771 35,449
L&N conversion/closing costs....................... 19,727
Net gain on sale/closure of B&I accounts........... (46,782)
Interest expense net of interest income totaling
$1,257 in 1995, $1,172 in 1994, and
$1,822 in 1993................................... 950 51 317
930,377 1,142,232 1,038,961
Income Before Provision for Income Taxes and
Cumulative Effect of Accounting Changes............ 104,712 71,157 60,884
Provision for Federal and State Income Taxes......... 42,541 26,473 22,725
Income Before Cumulative Effect of Accounting Changes 62,171 44,684 38,159
Cumulative Effect of Accounting Changes, net:
Postretirement benefits............................ (2,579)
Income taxes....................................... 2,395
Net Income........................................... $ 62,171 $ 44,684 $ 37,975
Earnings Per Common and Common Equivalent Share:
Before Cumulative Effect of Accounting Changes..... $ 1.73 $ 1.20 $ 1.01
Cumulative Effect of Accounting Changes, net:
Postretirement benefits.......................... (0.07)
Income taxes..................................... 0.06
Earnings Per Common and Common Equivalent Share...... $ 1.73 $ 1.20 $ 1.00
Weighted average common and
common equivalent shares........................... 35,922 37,367 38,078
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
<TABLE>
CONSOLIDATED BALANCE SHEETS
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
(In thousands)
<CAPTION>
June 3, June 4,
1995 1994
<S> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and short-term investments..................................................... $ 8,321 $ 5,021
Receivables:
Trade, less allowance for doubtful accounts
of $1,641 in 1995 and $2,622 in 1994.............................................. 18,649 28,396
Other................................................................................. 10,394 4,663
Inventories:
Merchandise....................................................................... 8,801 11,523
China, silver and supplies............................................................ 4,797 4,873
Prepaid expenses................................................................... 17,492 13,327
Deferred income tax benefits.......................................................... 11,744 11,813
Total Current Assets............................................................... 80,198 79,616
PROPERTY AND EQUIPMENT - at cost:
Land............................................................................... 24,524 15,753
Buildings.......................................................................... 60,727 48,487
Improvements.......................................................................... 223,968 187,113
Restaurant equipment................................................................ 194,783 181,084
Other equipment..................................................................... 48,623 52,519
Construction in progress............................................................ 48,087 22,825
600,712 507,781
Less accumulated depreciation and amortization........................................ 255,549 240,124
345,163 267,657
COSTS IN EXCESS OF NET ASSETS ACQUIRED................................................ 27,187 22,571
OTHER ASSETS.......................................................................... 31,503 38,609
TOTAL ASSETS...................................................................... $484,051 $408,453
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable.................................................................... $ 45,974 $ 30,401
Short-term borrowings............................................................... 12,638 17,416
Accrued liabilities:
Taxes, other than income taxes.................................................... 14,127 14,571
Payroll and related costs......................................................... 14,355 22,725
Insurance......................................................................... 18,120 23,225
Rent and other.................................................................... 19,583 10,180
Current portion of long-term debt................................................... 181 4,105
Total Current Liabilities......................................................... 124,978 122,623
LONG-TERM DEBT:
Capital lease obligations........................................................... 848 931
Notes and mortgages payable......................................................... 51,247 8,595
52,095 9,526
DEFERRED INCOME TAXES................................................................. 11,528 11,073
OTHER DEFERRED LIABILITIES............................................................ 49,957 44,095
STOCKHOLDERS' EQUITY:
Common stock, $0.01 par value; (authorized: 100,000 shares;
issued: 43,644 shares)............................................................ 436 436
Capital in excess of par value...................................................... 84,515 77,656
Retained earnings................................................................... 298,181 248,044
383,132 326,136
Less cost of treasury stock......................................................... 137,639 105,000
245,493 221,136
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY........................................ $484,051 $408,453
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
<TABLE>
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
(In thousands except per-share data)
<CAPTION>
Capital in Total
Common Stock Issued Treasury Stock Excess of Retained Stockholders'
Shares Amount Shares Amount Par Value Earnings Equity
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, June 6, 1992........................ 29,097 $ 291 (4,450) $ (59,252) $ 73,413 $189,125 $203,577
Net Income................................. 37,975 37,975
Shares issued under stock bonus and stock
option plans.............................. 241 2,981 1,768 4,749
Cash Dividends of $0.32 per common share... (11,874) (11,874)
Purchase of Treasury Stock
including deferred compensation plan...... (514) (14,803) (14,803)
Balance, June 5, 1993........................ 29,097 291 (4,723) (71,074) 75,181 215,226 219,624
Net Income................................. 44,684 44,684
3-for-2 Stock Split........................ 14,547 145 (2,415) (145) 0
Shares issued under stock bonus and stock
option plans.............................. 484 5,844 2,620 8,464
Cash Dividends of $0.3299 per common share. (11,866) (11,866)
Purchase of Treasury Stock
including deferred compensation plan...... (1,681) (39,770) (39,770)
Balance, June 4, 1994........................ 43,644 436 (8,335) (105,000) 77,656 248,044 221,136
Net Income................................. 62,171 62,171
Shares issued under stock bonus and stock
option plans.............................. 562 7,792 3,132 10,924
Shares issued pursuant to Tia's, Inc. acquisition 355 5,273 3,727 9,000
Cash Dividends of
$0.35 per common share.................... (12,034) (12,034)
Purchase of Treasury Stock including
deferred compensation plan................ (1,701) (45,704) (45,704)
Balance, June 3, 1995........................ 43,644 $ 436 (9,119) $(137,639) $ 84,515 $298,181 $245,493
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
<TABLE>
CONSOLIDATED STATEMENTS OF CASH FLOWS
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
(In thousands)
<CAPTION>
For the Fiscal Year Ended
June 3, June 4, June 5,
1995 1994 1993
<S> <C> <C> <C>
Operating Activities:
Net Income....................................... $ 62,171 $ 44,684 $ 37,975
Adjustments to reconcile net income to net
cash provided by operating activities:
Cumulative effect of change in
accounting principles........................ 184
Depreciation and amortization.................. 39,149 39,771 35,449
Amortization of intangibles.................... 760 1,043 1,047
Gain on sale of B&I contracts and assets....... (46,782)
Other, net..................................... (3,088) 1,702 1,996
Deferred income taxes.......................... 3,153 4,963 (2,356)
Loss on disposition of assets.................. 9,396 1,300 1,243
Changes in operating assets and liabilities:
(Increase)/decrease in receivables........... 1,431 (1,278) (3,729)
Increase in inventories...................... (951) (893) (1,771)
(Increase)/decrease in prepaid and
other assets............................... 4,193 (1,907) (1,613)
Increase/(decrease) in accounts payable,
accrued and other liabilities............... (6,617) 4,507 27,158
Decrease in income taxes payable............. (4,836) (1,171) (2,745)
Net Cash Provided by Operating Activities... 57,979 92,721 92,838
Investing Activities:
Purchases of property and equipment............. (131,356) (90,330) (62,986)
Proceeds from sale of B&I contracts and assets.. 100,000
Proceeds from disposal of assets................ 981 1,512 1,150
Other, net...................................... (3,530) (4,909) (4,031)
Net Cash Used by Investing Activities....... (33,905) (93,727) (65,867)
Financing Activities:
Proceeds from long-term debt.................... 50,000 558
Net change in short-term borrowings............. (11,828) 17,416
Principal payments on long-term debt and
capital leases.............................. (12,132) (147) (23,771)
Proceeds from issuance of stock,
including treasury stock....................... 10,924 8,464 4,749
Stock repurchases............................... (45,704) (39,770) (14,803)
Dividends paid.................................. (12,034) (11,866) (11,874)
Net Cash Used by Financing Activities....... (20,774) (25,345) (45,699)
Increase/(decrease) in cash and short-term
Investments................................. 3,300 (26,351) (18,728)
Cash and short-term investments at the beginning
of the year..................................... 5,021 31,372 50,100
Cash and short-term investments at the end of
the year........................................ $ 8,321 $ 5,021 $ 31,372
Supplemental Disclosure of Cash Flow Information-
Cash Paid for:
Interest (net of amount capitalized)............ $ 2,405 $ 904 $ 1,946
Income taxes, net............................... $ 46,865 $ 25,298 $ 28,103
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
June 3, 1995
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation - The accompanying consolidated financial
statements include the accounts of Morrison Restaurants Inc. and its
wholly-owned subsidiaries.
Fiscal Year - The Company's fiscal year ends on the first Saturday after
May 30. The fiscal years ended June 3, 1995, June 4, 1994, and June 5, 1993
were comprised of 52 weeks.
Inventories - Inventories consist of materials, food supplies, china and
silver and are stated at the lower of cost (first in-first out) or market.
Property and Equipment and Depreciation - Depreciation for financial
reporting purposes is computed using the straight-line method over the
estimated useful lives of the assets or, for capital lease property, over the
term of the lease, if shorter. Annual rates of depreciation range from 3% to
5% for buildings and from 8% to 34% for restaurant and other equipment.
During March 1995, the Financial Accounting Standards Board 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"
(FAS 121). FAS 121 requires that, beginning in fiscal years starting after
December 15, 1995, long-lived assets and certain identifiable intangibles to
be held and used by an entity be reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount of an asset may not
be recoverable. Long-lived assets and certain identifiable intangibles to be
disposed of are generally to be reported at the lower of carrying amount or
fair value less cost to sell. Currently, the Company recognizes such
impairment upon the decision to close a unit. The ultimate impact of FAS 121
on the Company's financial statements is being analyzed. However, Management
believes that adoption of FAS 121 will not have a material impact on the
Company's financial position or results of operations.
Income Taxes - Deferred income taxes are determined utilizing a liability
approach. This method gives consideration to the future tax consequences
associated with differences between financial accounting and tax bases of
assets and liabilities.
Pre-Opening Expenses - Salaries, personnel training costs and other
expenses of opening new facilities are charged to expense as incurred.
Earnings Per Share - Earnings per share are based on the weighted average
number of shares outstanding during each year and are adjusted for the assumed
exercise of options, after the assumed repurchase of shares with the related
proceeds and after the adjustment for the stock splits and stock dividends
through June 3, 1995.
Intangible Assets - Excess of costs over the fair value of net assets
acquired of purchased businesses generally is amortized on a straight-line
basis over 40 years. The carrying value of goodwill is reviewed if facts and
circumstances suggest that it may be impaired. At June 3, 1995 and June 4,
1994, accumulated amortization for costs in excess of net assets acquired was
$5,957,000 and $6,736,000, respectively. Other intangibles are amortized over
their specified lives, varying from five to 20 years. For the years ending
June 3, 1995 and June 4, 1994, accumulated amortization for other intangibles
was $351,000 and $2,157,000, respectively.
Fair Value of Financial Instruments - The Company's financial instruments
at June 3, 1995 and June 4, 1994 consisted of cash and short-term investments,
notes receivable, short-term borrowings and long-term debt. The fair value of
these financial instruments approximated the carrying amounts reported in the
consolidated balance sheets.
2. BUSINESS SEGMENT
The Company operates exclusively in the foodservice industry. During
fiscal 1995, the Company was organized into the following two operating groups:
Ruby Tuesday Group - consists of the Ruby Tuesdays, Mozzarella's Cafes,
and Tia's Tex-Mex concepts. As discussed in Note 4, during fiscal year 1995,
the Company completed its plan to phase out the L&N Seafood Grill concept.
With the exception of four units which Management has decided to continue to
operate through the end of their remaining lease terms, all L&N Seafood Grill
units have been closed or converted into other Ruby Tuesday Group concepts as
of June 3, 1995.
Morrison Group - comprised of Morrison's Cafeterias, Sadie's Buffets and
Grills, Morrison's Fresh Cooking, and contract food-service healthcare accounts.
On August 8, 1994, the Company sold certain education, business and industry
contracts and assets of the Morrison Group to Gardner Merchant Food Services,
Inc., a wholly-owned subsidiary of Gardner Merchant Ltd.
Operating profit is defined as income from operations before unallocated
general and administrative expenses, net interest expense and income taxes.
Corporate assets consist primarily of cash (including short-term
investments) and certain property, including the administrative headquarters.
Financial data with respect to the Company's Groups is presented on page
35.
3. ACQUISITION OF TIAS, INC.
On January 17, 1995 the Company acquired all of the outstanding common
stock of Tias, Inc., a twelve-unit Tex-Mex restaurant concept based in Dallas,
Texas, for $9.0 million in common stock (354,673 shares). The acquisition has
been accounted for as a purchase. Accordingly, the purchase price was
allocated on the basis of the estimated fair value of the assets acquired and
liabilities assumed. This treatment resulted in goodwill of $12.2 million which
is being amortized on a straight-line basis over 40 years.
4. PHASE-OUT OF THE L&N SEAFOOD GRILL CONCEPT
On June 27, 1994, plans to phase out the L&N Seafood Grill concept were
announced by the Company. The original plan, as approved by the Board of
Directors, called for the conversion of 30 L&N units into other Company
concepts. All remaining units were to be sold or closed. The Company accrued
$19.7 million for costs to be incurred as a result of the phase-out. This
amount, originally accrued to cover the costs to convert 30 L&N units and close
the remaining eight, consisted primarily of the following: losses on disposal
of fixed assets net of anticipated proceeds and the net cost of related lease
obligations for the units to be closed (approximately $11.6 million), expected
operating losses during the phase out period (approximately $4.8 million),
severance pay (approximately $1.1 million) and other losses on the conversion
of units, consisting primarily of the write-off of fixed assets, inventory, and
unamortized cost in excess of net assets acquired (approximately $2.2 million).
Subsequent to the June, 1994 announcement, the Company reacquired three
additional L&N units as a result of a default on a licensing agreement. These
three units were closed. Based on favorable operating results, in the third
quarter of fiscal 1995, Management decided to continue to operate four of the
L&N units as L&N's through the remainder of their lease terms. The sales and
earnings of these four units have been included in the operating results of the
Ruby Tuesday Group since the beginning of third quarter. During the year, 21
of the L&N units have been converted and are operating as other Ruby Tuesday
Group restaurants. One additional unit was converted and reopened as a Tia's
shortly after year-end. Another unit is in the process of being converted to
a Tia's. The remaining 11 units were closed.
Of the original $19.7 million accrued to phase out the concept, $6.0
million of reserves remain outstanding as of June 3, 1995. The majority of
these reserves relate to costs anticipated to be incurred to settle the lease
obligations on closed units and property and equipment write-offs. The Company
anticipates settlement of most, if not all, of these leases by the end of the
first quarter of fiscal year 1996.
5. SALE OF THE EDUCATION, BUSINESS, AND INDUSTRY CONTRACTS AND ASSETS
On August 8, 1994, the Company sold certain education, business, and
industry (B&I) contracts and assets of the Morrison Group to Gardner Merchant
Food Services, Inc., a wholly-owned subsidiary of Gardner Merchant Ltd., for a
cash payment of $100.0 million. The remaining B&I accounts were closed. The
sale of the B&I accounts and the discontinuance of the remaining accounts
resulted in a pre-tax gain of $46.8 million, or $25.8 million after applicable
taxes.
Sales from B&I contracts in fiscal year 1994 were $250.7 million, with
operating profits of $7.3 million.
6. CASH AND SHORT-TERM INVESTMENTS
The Company's cash management program provides for the investment of
excess cash balances in short-term money market instruments. Short-term
investments at June 3, 1995 and June 4, 1994, of approximately $1.5 and $1.0
million, respectively, consisted primarily of tax exempt short-term
securities. Short-term investments are stated at cost, which approximates
market. The Company considers short-term marketable securities with a
maturity of three months or less when purchased to be short-term investments.
7. NOTES AND MORTGAGES PAYABLE
Notes and mortgages payable consists of the following:
<TABLE>
<CAPTION>
(In thousands)
1995 1994
<C> <C> <C>
$200 million Revolving Credit Facility. $50,000 $ 0
8.88% Senior Promissory Notes
payable to Life Insurance
Company of Georgia................. 12,000
Other Notes and Mortgages............ 1,345 625
51,345 12,625
Less current maturities............... 98 4,030
$51,247 $ 8,595
Annual maturities of notes and mortgages at June 3, 1995 are
as follows:
<CAPTION>
(In thousands)
<C> <C>
1996.................................... $ 98
1997.................................... 106
1998.................................... 114
1999.................................... 123
2000.................................... 50,091
Subsequent years........................ 813
Total 51,345
</TABLE>
During the quarter ended September 3, 1994, the Company retired the $12.0
million 8.88% Senior Promissory Note payable to Life Insurance Company of
Georgia.
On September 30, 1994, the Company entered into a five-year revolving
line of credit with various banks which allows the Company to borrow up to
$200.0 million under various interest rate options. Commitment fees ranging
from 0.0625% to 0.15% per annum are payable on the unused portion of the
credit facility. At June 3, 1995, the Company had $50.0 million of borrowings
outstanding with various banks under the terms of the agreement at interest
rates ranging from 6.32% to 6.44% per annum. Such borrowings (with maturities
up to 180 days) have been classified as long-term based on the Company's ability
and intent to refinance such borrowings under the revolving facility.
The credit facility provides for certain restrictions on incurring
additional indebtedness and to certain funded debt, net worth, and fixed
charge coverage requirements. At June 3, 1995, retained earnings in the amount
of $39.4 million were available for distribution under the debt restrictions.
In addition, at June 3, 1995, the Company had committed lines of credit
amounting to $32.0 million (of which $19.4 million remain available at June 3,
1995) and non-committed lines of credit amounting to $94.0 million with various
banks at various interest rates. All of these lines are subject to periodic
review by each bank and may be canceled by the Company at any time. The Company
utilized its lines of credit to meet operational cash needs during fiscal 1995.
Borrowings on these lines of credit were $12.6 million and $17.4 million at
June 3, 1995 and June 4, 1994, respectively. In order to control its fiscal
1996 interest costs, the Company entered into an interest rate swap agreement
during the fourth quarter. This swap agreement, which has a notional amount
accreting from $85.0 to $115.0 million, effectively limits the interest rate
to a maximum of 7.02% per annum for the one year period commencing June 5, 1995.
Interest expense capitalized in connection with financing additions to
property and equipment amounted to approximately $1.1 and $1.0 million for the
years ended June 3, 1995 and June 4, 1994, respectively.
At June 3, 1995 and June 4, 1994, long-term debt amounts of $1.5 and $1.8
million, respectively, are considered extinguished in accordance with Statement
of Financial Accounting Standards No. 76 concerning in-substance defeasance of
corporate debt. U. S. Treasury Bills and cash have been placed in an
irrevocable trust to satisfy scheduled payments of both interest and principal
on these defeased obligations.
8. LEASES
Various operations of the Company are conducted in leased premises.
Initial lease terms expire at various dates over the next 24 years and may
provide for escalation of rent during the lease term. Most of these leases
provide for additional contingent rents based upon sales volume and contain
options to renew (at adjusted rentals for some leases). The administrative
headquarters has a lease term ending in 1998 and provides an option to purchase
at a nominal amount at the end of the initial lease term.
Assets recorded under capital leases (included in Property and Equipment
in the accompanying consolidated balance sheets) are as follows:
<TABLE>
<CAPTION>
(In thousands)
1995 1994
<S> <C> <C>
Other equipment....... $ 86 $ 592
Buildings............. 6,042 6,042
6,128 6,634
Less accumulated
amortization........ 3,243 3,557
$ 2,885 $ 3,077
======= =======
</TABLE>
At June 3, 1995, the future minimum lease payments under capital leases
and operating leases for the next five years and in the aggregate are as
follows:
<TABLE>
<CAPTION>
(In thousands)
Capital Operating
Leases Leases
<C> <C> <C>
1996.................... $ 186 $ 44,323
1997.................... 185 44,534
1998.................... 185 43,681
1999.................... 185 42,120
2000.................... 185 40,126
Subsequent years........ 704 286,860
Total minimum
lease payments........ 1,630 $501,644
========
Less amount representing
interest.............. 699
Present value of minimum
lease payments under
capital leases (including
current maturities
of $83)............... $ 931
=======
</TABLE>
Rental expense pursuant to operating leases is summarized as follows:
<TABLE>
<CAPTION>
(In thousands)
1995 1994 1993
<S> <C> <C> <C>
Minimum rent............ $44,095 $43,126 $37,505
Contingent rent......... 7,826 12,662 11,120
$51,921 $55,788 $48,625
======= ======= =======
</TABLE>
At June 3, 1995 and June 4, 1994, respectively, $1.3 and $1.5 million of
capital lease obligations are considered extinguished in accordance with
Statement of Financial Accounting Standards No. 76 concerning in-substance
defeasance of corporate debt. U. S. Treasury Bills and cash have been placed
in an irrevocable trust to satisfy scheduled payments of both interest and
principal on these capital lease obligations.
9. INCOME TAXES
The Company adopted Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes" in fiscal 1993. The cumulative effect of this
change in accounting principle increased fiscal 1993 net income by $2.4
million, or $0.06 per share, and is reported separately in the consolidated
statement of income for the fiscal year ended June 5, 1993.
The components of income tax expense attributable to operations are as
follows:
<TABLE>
<CAPTION>
(In thousands)
1995 1994 1993
<S> <C> <C> <C>
Current:
Federal.......................... $ 31,971 $ 17,587 $ 20,893
State............................ 7,417 3,923 4,369
39,388 21,510 25,262
Deferred:
Federal.......................... 3,303 4,204 (2,089)
State............................ (150) 759 (448)
3,153 4,963 (2,537)
$ 42,541 $ 26,473 $ 22,725
</TABLE>
Deferred tax assets and liabilities are comprised of the following:
<TABLE>
<CAPTION>
(In thousands)
1995 1994
<S> <C> <C>
Deferred Tax Assets
Employee benefits............... $ 12,048 $ 11,076
Insurance reserves.............. 10,485 12,452
Unit closing reserve............ 6,839 2,664
Escalating rents................ 2,655 2,413
Acquired net operating losses... 2,629
Other........................... 1,530 2,210
Total deferred tax assets...... 36,186 30,815
Deferred Tax Liabilities
Depreciation.................... 27,280 25,494
Retirement plans................ 2,601 2,169
Prepaid deductions.............. 2,489 1,659
Other........................... 3,600 753
Total deferred tax liabilities. 35,970 30,075
Net deferred tax asset......... $ 216 $ 740
</TABLE>
At June 3, 1995, the Company had net operating loss carryforwards
for tax purposes of approximately $6.7 million as a result of the acquisition
of Tias, Inc., which expire through 2002. The Company's net operating loss
carryforwards are subject to an annual limitation for tax reporting purposes
due to changes in ownership of the acquired company.
A reconciliation from the statutory Federal income tax expense to the
reported income tax expense is as follows:
<TABLE>
<CAPTION>
(In thousands)
1995 1994 1993
<S> <C> <C> <C>
Statutory Federal income tax...... $ 36,649 $ 24,905 $ 20,701
State income taxes net of
Federal income tax benefit....... 4,543 3,006 2,532
Tax credits....................... (3,927) (2,163) (901)
B&I divestiture items............. 2,575
Other, net........................ 2,701 725 393
$ 42,541 $ 26,473 $ 22,725
</TABLE>
The effective income tax rate was 40.6%, 37.2%, and 37.3% in 1995, 1994,
and 1993, respectively. The effective income tax rate increase in fiscal year
1995 was due to the nondeductibility of acquired goodwill disposed of in
connection with the divestiture of the B&I accounts.
10. EMPLOYEE BENEFIT PLANS
Salary Deferral Plan - Under the Morrison Restaurants Inc. Salary Deferral
Plan each eligible employee, as defined in the Plan, may elect to make pre-tax
contributions to a trust fund in amounts ranging from 2% to 10% of their annual
earnings. Employees contributing a pre-tax contribution of at least 2% may
elect to make after-tax contributions not in excess of 10% of annual earnings.
The Company contribution to the Plan is based on the employee's pre-tax
contribution and years of service. After three years of service the Company
contributes 20% of the employee's pre-tax contribution, 30% after ten years of
service and 40% after 20 years of service. Normally, the full amount of each
participant's interest in the trust fund is paid upon retirement or total
disability. However, the Plan allows participants to make early withdrawals of
pre-tax and after-tax contributions, subject to certain restrictions. The Plan
may be terminated by the Company at any time. The Company's contributions to
the trust fund approximated $725,000, $711,000, and $692,000 for 1995, 1994,
and 1993, respectively.
Deferred Compensation Plan - The Company maintains the Morrison
Restaurants Inc. Deferred Compensation Plan for certain selected employees.
The provisions of this non-qualified Plan are similar to those of the Salary
Deferral Plan except for the employees who are eligible to participate. The
Company's contributions under the Plan approximated $444,000, $483,000, and
$502,000 for 1995, 1994, and 1993, respectively. Assets of the Plan are
held by a rabbi trust. Under current accounting rules, assets of a
rabbi trust must be accounted for as if they are assets of the Company,
therefore, all earnings and expenses are recorded in the Company's financial
statements. The net of the rabbi trust's earnings and losses is recorded as
additional liability to the participants and is considered to be interest
expense to the Company. The Company recorded $997,000, $566,000, and $457,000
interest expense for this Plan in 1995, 1994, and 1993, respectively. Assets
of the Plan approximated $16,109,000 and $13,083,000 in 1995 and 1994 and
include $7,870,000 and $5,517,000 of Morrison Restaurants Inc. common stock
which is accounted for as treasury stock.
Retirement Plan - Effective December 31, 1987, the Morrison Restaurants
Inc. Retirement Plan was amended so that no additional benefits will accrue
and no new participants will enter the Plan after that date. Participants
will receive benefits based upon salary and length of service. No contribution
was made in 1995, 1994 or 1993. The Company recorded net pension expense of
$5,000 in 1995 and income of $95,000 and $79,000 in 1994 and 1993, respectively.
The 1995 net pension expense includes a settlement loss of $115,000, which was
recognized due to the sale of the B&I accounts and assets on August 8, 1994.
Executive Supplemental Pension Plan - Under the unfunded Executive
Supplemental Pension Plan, selected employees become eligible to receive
supplemental retirement payments based upon salary and length of service,
reduced by social security benefits and amounts otherwise receivable under the
Retirement Plan. Expenses under the Plan approximated $1,176,000, $905,000,
and $717,000 for 1995, 1994, and 1993, respectively. The 1995 pension expense
includes a curtailment loss of $199,000 and a settlement gain of $2,000 due to
the sale of B&I accounts and assets.
Management Retirement Plan - Under the unfunded Morrison Restaurants Inc.
Management Retirement Plan, individuals actively employed by the Company as of
June 1, 1989, or thereafter, who have 15 years of credited service and whose
average annual compensation for the immediately preceding three calendar years
equalled or exceeded $40,000, become participants. Participants will receive
benefits based upon salary and length of service, reduced by social security
benefits and benefits payable under the Retirement Plan and Executive
Supplemental Pension Plan. Expenses recognized approximated $660,000,
$492,000, and $294,000 in 1995, 1994, and 1993, respectively. The 1995 pension
expense includes a curtailment loss of $89,000 and a settlement gain of $161,000
due to the sale of the B&I accounts and assets.
To provide a funding source for the payments of benefits under the
Executive Supplemental Pension Plan and the Management Retirement Plan, the
Company owns whole-life insurance contracts on some of the participants. The
cash value of these policies net of policy loans is $2,985,000 at June 3,
1995. The Company has established a rabbi trust to hold the policies and death
benefits as they are received.
The following table details the components of pension expense, the funded
status and amounts recognized in the Company's Consolidated Financial
Statements for the Management Retirement Plan, the Executive Supplemental
Pension Plan, and the Retirement Plan.
<TABLE>
<CAPTION>
(In thousands)
Assets Exceed (Less Than) Accumulated Benefits Exceed Assets-
Accumulated Benefits- Executive Supplemental Pension Plan
Retirement Plan and Management Retirement Plan
June 3, June 4, June 5, June 3, June 4, June 5,
1995 1994 1993 1995 1994 1993
<S> <C> <C> <C> <C> <C> <C>
Components of pension expense (income):
Service cost......................... $ 0 $ 0 $ 0 $ 221 $ 203 $ 195
Interest cost........................ 1,395 1,395 1,558 841 705 616
Actual return on plan assets......... (447) (2,076) (1,935)
Amortization and deferral............ (1,058) 586 298 375 489 200
Curtailment loss..................... 288
Settlement loss (gain) .............. 115 (162)
Other................................ 272
$ 5 $ (95) $ (79) $ 1,835 $ 1,397 $ 1,011
Plan assets at fair value............ $ 17,127 $ 19,832 $ 19,653 $ 0 $ 0 $ 0
Actuarial present value of
projected benefit obligations:
Accumulated benefit obligations:
Vested............................ 16,752 19,383 16,281 10,461 5,973 3,640
Nonvested......................... 24 1,711 1,225
Provision for future salary
increases.......................... 2,691 4,332 2,243
Total projected benefit obligations... 16,752 19,383 16,281 13,176 12,016 7,108
Excess (deficit) of plan assets over
projected benefit obligations........ 375 449 3,372 (13,176) (12,016) (7,108)
Unrecognized net loss (gain).......... 3,334 2,985 (325) (806) 457 (3,689)
Unrecognized prior service cost....... 19 49 2,027 604 777
Unrecognized net transition obligation 1,832 2,093 2,355 3,025 3,693 3,990
Additional minimum liability.......... (1,762) (980) (366)
Prepaid (accrued) pension cost........ $ 5,541 $ 5,546 $ 5,451 $(10,692) $ (8,242) $ (6,396)
</TABLE>
The Retirement Plan's assets include common stock, fixed income
securities, short-term investments and cash. The weighted-average discount
rate for all three plans is 8.5%, 7.5%, and 9.5% for 1995, 1994, and 1993,
respectively. The rate of increase in compensation levels for the Executive
Supplemental Pension Plan and Management Retirement Plan is 4% for 1995 and
5% for 1994 and 1993. The expected long-term rate of return on plan assets
for the Retirement Plan is 10% for all three years.
11. POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
The Company provides healthcare benefits to substantially all retired
employees and life insurance benefits to certain retirees. Benefits are
funded as medical claims and life insurance premiums are incurred. Retirees
become eligible for retirement benefits if they have met certain service and
minimum age requirements at date of retirement. The Company accrues expenses
related to postretirement healthcare and life insurance benefits during the
years an employee provides services. The total postretirement benefit costs
for 1995, 1994, and 1993 were $584,000, $548,000, and $407,000, respectively.
In 1993, the Company adopted Statement of Financial Accounting Standards
No. 106, "Employers' Accounting for Postretirement Benefits Other Than
Pensions". The cumulative effect of this change in accounting for years prior
to 1993, resulted in a charge of $2,6 million, or $0.07 per share, which is
net of a tax benefit of $1.6 million.
The actuarial present value of accumulated postretirement benefit
obligations and the amounts recognized in the Company's consolidated balance
sheets are as follows:
<TABLE>
<CAPTION>
(In thousands)
1995 1994
<S> <C> <C>
Retirees $4,300 $4,355
Fully eligible active plan participants 678 882
Other active plan participants 460 671
Accumulated postretirement benefit obligation 5,438 5,908
Unrecognized net loss (1,236) (1,747)
Accrued postretirement benefit cost $4,202 $4,161
The postretirement benefit cost is as follows:
<CAPTION>
(In thousands)
1995 1994 1993
<S> <C> <C> <C>
Service cost $ 30 $ 38 $ 29
Interest cost 423 380 378
Amortization of unrecognized net loss 131 130
Postretirement benefit cost $ 584 $ 548 $ 407
</TABLE>
The assumed healthcare cost trend rate used in measuring the accumulated
postretirement benefit obligation was 0% because the Company's plan calls
for a level future contribution by the employer. Measurement of the
accumulated postretirement benefit obligation was based on an assumed 8.5%
discount rate for fiscal 1995 and 7.5% for 1994.
12. PREFERRED STOCK
Under its Certificate of Incorporation the Company is authorized to issue
preferred stock with a par value of $0.01 in an amount not to exceed 250,000
shares which may be divided into and issued in designated series, with dividend
rates, rights of conversion, redemption, liquidation prices and other terms or
conditions as determined by the Board of Directors. No preferred shares have
been issued as of June 3, 1995. The Board of Directors has designated 50,000
of such shares as Series A Junior Participating Preferred Stock and has issued
rights to acquire such shares, upon certain events, with an exercise price of
$75.00 per one one-thousandth of a share, subject to adjustment. The rights
expire on April 9, 1997, and may be redeemed prior to ten days after the
acquisition of 20% or more of the Company's common stock.
13. CAPITAL STOCK, OPTIONS, AND BONUS PLANS
The Morrison Restaurants Inc. Stock Incentive Plan - In September, 1992,
the shareholders approved The Morrison Restaurants Inc. Stock Incentive Plan
which is an amendment and restatement of The Morrison Restaurants Inc. 1989
Non-Qualified Stock Option Plan. A Committee, appointed by the Board,
administers the Plan on behalf of the Company and has complete discretion to
determine participants and the terms and provisions of Stock Incentives,
subject to the Plan. The Plan permits the Committee to make awards of shares
of common stock, awards of derivative securities related to the value of the
common stock, and certain cash awards to eligible persons. These discretionary
awards may be made on an individual basis or pursuant to a program approved by
the Committee for the benefit of a group of eligible persons. The Plan permits
the Committee to make awards of a variety of stock incentives, including (but
not limited to) dividend equivalent rights, incentive stock options,
non-qualified stock options, performance unit awards, phantom shares, stock
appreciation rights and stock awards. During 1995, 17,000 shares were issued
under the Plan. At June 3, 1995, the Company had reserved a total of 1,182,000
shares of common stock for this Plan.
The Morrison Restaurants Inc. Stock Incentive and Deferred Compensation
Plan for Directors -
In September, 1994, the shareholders approved the Morrison Restaurants Inc.
Stock Incentive and Deferred Compensation Plan for Directors, which is an
amendment and restatement of a similarly titled 1992 plan. In general, the
Plan sets a target ownership level for non-management directors. To facilitate
attaining the target ownership level, the Plan provides that the directors must
use 60% of their retainer to purchase shares of the Company. Each director
purchasing stock receives an additional 15% of the shares purchased and three
times the total shares in options which after six months are exercisable for
five years from the grant date. During 1995, 2,000 shares were issued under
the Plan. Pursuant to this Plan, a one-time restricted stock award totaling
10,000 shares was made in fiscal 1995 to non-management directors who were
elected after September 1993. A Committee, appointed by the Board, administers
the Plan on behalf of the Company. At June 3, 1995, the Company had reserved
195,000 shares of common stock for the Directors' Plan.
The Morrison Restaurants Inc. 1993 Non-Executive Stock Incentive Plan -
In October, 1993, the Board of Directors approved the Morrison Restaurants
Inc. 1993 Non-Executive Stock Incentive Plan. A Committee, appointed by the
Board, administers the Plan on behalf of the Company and has full authority in
its discretion to determine the officers and key employees to whom Stock
Incentives are granted and the terms and provisions of Stock Incentives,
subject to the Plan. During 1995, 69,000 shares were issued under the Plan.
At June 3, 1995, the Company had reserved a total of 1,322,000 shares of
common stock for this Plan.
In addition to the above plans, stock options remain outstanding on two
terminated plans, the Morrison Restaurants Inc. Long-Term Incentive Plan,
which was effective from 1984 to 1989, and the Morrison Restaurants Inc.
Stock Bonus and Non-Qualified Stock Option Plan, which was effective
from 1986 to 1992. Options to purchase 26,000 and 1,040,000 shares,
respectively, remain outstanding under the terms of these two plans at June 3,
1995.
The following table summarizes the activity in options under these stock
option plans:
<TABLE>
<CAPTION>
Number of Shares Under Option
(Amounts in thousands except per-share data)
1995 1994 1993
<S> <C> <C> <C>
Beginning of year........... 2,717 2,386 2,258
Granted..................... 343 755 492
Exercised................... (258) (313) (267)
Forfeited................... (107) (111) (97)
End of year................. 2,695 2,717 2,386
Exercisable................. 971 958 558
Outstanding options' prices. $7.61-$28.75 $5.40-$25.38 $5.40-$16.75
Exercised options' prices... $5.40-$25.38 $5.40-$11.36 $5.40-$11.50
</TABLE>
14. Contingencies
At June 3, 1995, the Company was contingently liable for approximately
$29.7 million in letters of credit, issued primarily in connection with its
workers' compensation and casualty insurance programs.
The Company is presently, and from time to time, subject to pending
claims and lawsuits arising in the ordinary course of its business. In the
opinion of Management, the ultimate resolution of these pending legal
proceedings will not have a material adverse effect on the Company's operations
or consolidated financial position.
15. SUPPLEMENTAL QUARTERLY FINANCIAL DATA (UNAUDITED)
Quarterly financial results for the years ended June 3, 1995 and June 4,
1994, are summarized below. All quarters are composed of 13 weeks.
<TABLE>
<CAPTION>
(In thousands except per-share data)
FIRST SECOND THIRD FOURTH
QUARTER QUARTER QUARTER QUARTER TOTAL
<S> <C> <C> <C> <C> <C>
For The Year Ended June 3, 1995:
Revenues........................................... $241,250 $252,523 $271,966 $269,350 $1,035,089
Gross Profit*...................................... $ 43,860 $ 47,265 $ 49,826 $ 48,475 $ 189,426
Income Before Income Taxes......................... $ 44,380 $ 19,436 $ 21,082 $ 19,814 $ 104,712
Provision for Federal and State Income Taxes....... 19,870 7,305 7,940 7,426 42,541
Net Income......................................... $ 24,510 $ 12,131 $ 13,142 $ 12,388 $ 62,171
Earnings Per Common and Common Equivalent Share.... $ 0.67 $ 0.34 $ 0.37 $ 0.35 $ 1.73
<CAPTION>
(In thousands except per-share data)
FIRST SECOND THIRD FOURTH
QUARTER QUARTER QUARTER QUARTER TOTAL
<S> <C> <C> <C> <C> <C>
For The Year Ended June 4, 1994:
Revenues........................................... $282,158 $310,360 $309,951 $310,920 $1,213,389
Gross Profit*...................................... $ 39,929 $ 47,697 $ 50,321 $ 48,167 $ 186,114
Income Before Income Taxes......................... $ 13,131 $ 19,495 $ 19,874 $ 18,657 $ 71,157
Provision for Federal and State Income Taxes....... 5,022 7,457 7,574 6,420 26,473
Net Income......................................... $ 8,109 $ 12,038 $ 12,300 $ 12,237 $ 44,684
Earnings Per Common and Common Equivalent Share.... $ 0.22 $ 0.32 $ 0.33 $ 0.33 $ 1.20
</TABLE>
* The Company defines Gross Profit as Revenues less Cost of Merchandise,
Payroll and Related Costs, and Other Operating Costs and Expenses.
Morrison Restaurants Inc. common stock is publicly traded on the New York Stock
Exchange under the ticker symbol RI. The following table sets forth the
reported high and low prices for each quarter during fiscal 1995 and 1994.
<TABLE>
<CAPTION>
Fiscal Year Ended June 3, 1995 Fiscal Year Ended June 4, 1994
Per Share Per Share
Cash Cash
Quarter High Low Dividends Quarter High Low Dividends
<S> <C> <C> <C> <S> <C> <C> <C>
First $25.88 $20.88 $0.0833 First $22.50 $19.13 $0.0800
Second $29.75 $24.88 $0.0875 Second $26.13 $21.13 $0.0833
Third $27.88 $22.88 $0.0875 Third $27.50 $21.75 $0.0833
Fourth $26.88 $20.88 $0.0875 Fourth $27.00 $22.00 $0.0833
</TABLE>
On June 29, 1995 the Company's Board of Directors declared a quarterly
dividend of $0.0875 per share payable July 31, 1995 to 6,925 shareholders
of record on July 14, 1995.
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
Stockholders and Board of Directors
Morrison Restaurants Inc. and Subsidiaries
We have audited the accompanying consolidated balance sheets of Morrison
Restaurants Inc. and Subsidiaries as of June 3, 1995 and June 4, 1994, and the
related consolidated statements of income, stockholders' equity and cash flows
for each of the three fiscal years in the period ended June 3, 1995. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Morrison
Restaurants Inc. and Subsidiaries at June 3, 1995 and June 4, 1994, and the
consolidated results of their operations and their cash flows for each of the
three fiscal years in the period ended June 3, 1995, in conformity with
generally accepted accounting principles.
/s/ Ernst & Young LLP
Birmingham, Alabama
June 21, 1995
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
EXHIBIT 21
SUBSIDIARIES OF REGISTRANT
(a) The Registrant has no parent.
(b) The Registrant's subsidiaries and their jurisdictions of each
organization are as follows (100% of voting securities of each subsidiary
owned by the Registrant):
Delaware:
Morrison International, Inc.
Ruby Tuesday, Inc.
Pennsylvania:
Custom Management Corporation
Custom Management Corporation of Pennsylvania
Morrison Custom Management Corporation of Pennsylvania
Texas:
Tias, Inc.
In addition to the subsidiaries listed above, the Registrant
has a minority ownership in several operating subsidiaries and
several wholly-owned and minority interests in non-operating
subsidiaries created solely for the purpose of holding certain
licenses.
Exhibit 23--Consent of Independent Auditors
We consent to the incorporation by reference in the Registration
Statement (Form S-8 No. 33-32697) pertaining to the Morrison
Restaurants Inc. Deferred Compensation Plan, in the Registration
Statement (Form S-8 No. 33-20585) pertaining to the Morrison
Restaurants Inc. Salary Deferral Plan, in the Registration
Statement (Form S-8 No. 2-97120) pertaining to the Morrison
Restaurants Inc. Long-Term Incentive Plan, in the Registration
Statement (Form S-8 No. 33-13593) pertaining to the Morrison
Restaurants Inc. 1987 Stock Bonus and Non-Qualified Stock Option
Plan, in the Registration Statement (Form S-8 No. 33-46220)
pertaining to Morrison Restaurants Inc. Compensatory Non-Qualified
Stock Option Arrangements, and in the Registration Statement (Form
S-8 No. 33-50452) pertaining to the Morrison Restaurants Inc.
Stock Incentive and Compensation Plan for Directors, Stock
Incentive Plan and Non-Qualified Management Stock Option
Agreements and in their related Prospectuses of our report dated
June 21, 1995, with respect to the consolidated financial
statements and schedules of Morrison Restaurants Inc. included in
the Annual Report (Form 10-K) for the year ended June 3, 1995.
Our audits also included the financial statement schedules of
Morrison Restaurants Inc. listed in Item 14(a). These schedules
are the responsibility of the Company's management. Our
responsibility is to express an opinion based on our audits. In
our opinion, the financial statement schedules referred to above,
when considered in relation to the basic financial statements
taken as a whole, present fairly in all material respects the
information set forth therein.
/s/ Ernst & Young LLP
Ernst & Young LLP
Birmingham, Alabama
August 31, 1995
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM MORRISON
RESTAURANTS INC. FINANCIAL STATEMENTS AS OF AND FOR THE PERIOD ENDED JUNE 3,
1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STAEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-03-1995
<PERIOD-END> JUN-03-1995
<CASH> 8,321
<SECURITIES> 0
<RECEIVABLES> 20,290
<ALLOWANCES> 1,641
<INVENTORY> 13,598
<CURRENT-ASSETS> 80,198
<PP&E> 600,712
<DEPRECIATION> 255,549
<TOTAL-ASSETS> 484,051
<CURRENT-LIABILITIES> 124,978
<BONDS> 52,095
<COMMON> 436
0
0
<OTHER-SE> 245,057
<TOTAL-LIABILITY-AND-EQUITY> 484,051
<SALES> 1,033,055
<TOTAL-REVENUES> 1,035,089
<CGS> 299,394
<TOTAL-COSTS> 884,812
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 950
<INCOME-PRETAX> 104,712
<INCOME-TAX> 42,541
<INCOME-CONTINUING> 62,171
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 62,171
<EPS-PRIMARY> $1.73
<EPS-DILUTED> $1.73
</TABLE>
