<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Amendment No. 9)
Under the Securities Exchange Act of 1934
Dairy Mart Convenience Stores, Inc.
(Name of Issuer)
Class B Common Stock, Par Value $.01 per share
(Title of Class of Securities)
233860105
(CUSIP Number)
DM Associates Limited Partnership
c/o Gregory Landry
Dairy Mart Convenience Stores, Inc.
One Vision Drive
Enfield, CT 06082
(203) 741-4502
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
December 1, 1995
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box: / /
Check the following box if a fee is being paid with this statement: / /
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CUSIP No. 233860105
1) Name of Reporting Person, S.S. or I.R.S. Identification No. of Above
Person: DM ASSOCIATES LIMITED PARTNERSHIP
IRS Identification No.: 06-1334995
2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a)
(b) X
3) SEC Use Only:
4) Source of Funds: WC,OO
5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d)
or 2(e):
6) Citizenship or Place of Organization: Connecticut
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7) Sole Voting Power: Voting power with respect to the Shares (as defined in
this Schedule 13D) owned of record by DM Associates Limited Partnership is
held by its general partner, New DM Management Associates I.
8) Shared Voting Power: See question 7 above.
9) Sole Dispositive Power: Dispositive power with respect to the Shares
owned of record by DM Associates Limited Partnership is held by its general
partner, New DM Management Associates I, subject to the consent of the
limited partners of DM Associates being required for any sale of more than
360,000 Shares.
10) Shared Dispositive Power: See question 9 above.
11) Aggregate Amount Beneficially Owned by Each Reporting Person: 1,858,743
12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares:
13) Percent of Class Represented by Amount in Row (11): 66.8%
14) Type of Reporting Person: PN
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CUSIP No. 233860105
1) Name of Reporting Person, S.S. or I.R.S. Identification No. of Above
Person: NEW DM MANAGEMENT ASSOCIATES I
IRS Identification No.: 06-1417404
2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a)
(b) X
3) SEC Use Only:
4) Source of Funds: Not Applicable
5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d)
or 2(e):
6) Citizenship or Place of Organization: Connecticut
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7) Sole Voting Power: Voting power of 638,743 of the Shares owned of record by
DM Associates Limited Partnership is held by its general partner, New DM
Management Associates I. New DM Management Associates I will vote such
Shares in such manner as the holders of a majority of the partnership
interests of New DM Management Associates I may determine. Robert B. Stein,
Jr., Gregory Landry and Mitchell Kupperman each own one-third of the
partnership interests of New DM Management Associates I. The other
1,220,000 Shares owned of record by DM Associates Limited Partnership will
be voted for or against any stockholder motion or proposal in the same
proportion that all other Shares are voted for or against such motion or
proposal (including the 638,743 Shares voted by DM Associates Limited
Partnership).
8) Shared Voting Power: See question 7 above.
9) Sole Dispositive Power: Dispositive power with respect to the Shares owned
of record by DM Associates Limited Partnership is held by its general
partner, New DM Management Associates I, subject to the consent of the
limited partners of DM Associates Limited Partnership being required for
any sale of more than 360,000 Shares. Robert B. Stein, Jr., as the managing
general partner of New DM Management Associates I,
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has the power to dispose of the Shares on behalf of New DM Management
Associates I.
10) Shared Dispositive Power: See question 9 above.
11) Aggregate Amount Beneficially Owned by Each Reporting Person: 1,858,743
12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares:
13) Percent of Class Represented by Amount in Row (11): 66.8%
14) Type of Reporting Person: PN
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CUSIP No. 233860105
1) Name of Reporting Person, S.S. or I.R.S. Identification No. of Above
Person: Robert B. Stein, Jr.
S.S. NO.: ###-##-####
2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a)
(b) X
3) SEC Use Only:
4) Source of Funds: PF
5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d)
or 2(e):
6) Citizenship or Place of Organization: United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7) Sole Voting Power: 0
8) Shared Voting Power: 1,858,743
9) Sole Dispositive Power: 1,858,743
10) Shared Dispositive Power: 1,220,000
11) Aggregate Amount Beneficially Owned by Each Reporting Person:
1,858,743
12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares:
13) Percent of Class Represented by Amount in Row (11): 66.8%
14) Type of Reporting Person: IN
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CUSIP No. 233860105
1) Name of Reporting Person, S.S. or I.R.S. Identification No. of Above
Person: Gregory G. Landry
S.S. No.: ###-##-####
2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a)
(b) X
3) SEC Use Only:
4) Source of Funds: PF
5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d)
or 2(e):
6) Citizenship or Place of Organization: United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7) Sole Voting Power: 0
8) Shared Voting Power: 1,858,743
9) Sole Dispositive Power: 0
10) Shared Dispositive Power: 1,220,000
11) Aggregate Amount Beneficially Owned by Each Reporting Person:
1,858,743
12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares:
13) Percent of Class Represented by Amount in Row (11): 66.8%
14) Type of Reporting Person: IN
6
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CUSIP No. 233860105
1) Name of Reporting Person, S.S. or I.R.S. Identification No. of Above
Person: Mitchell J. Kupperman
S.S. No.: ###-##-####
2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a)
(b) X
3) SEC Use Only:
4) Source of Funds: PF
5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d)
or 2(e):
6) Citizenship or Place of Organization: United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7) Sole Voting Power: 14,604
8) Shared Voting Power: 1,858,743
9) Sole Dispositive Power: 14,604
10) Shared Dispositive Power: 0
11) Aggregate Amount Beneficially Owned by Each Reporting Person:
1,873,347
12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares
13) Percent of Class Represented by Amount in Row (11): 67.3%
14) Type of Reporting Person: IN
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Reference is made to the Statement on Schedule 13D dated March 12, 1992,
filed jointly by DM Associates Limited Partnership, DM Management Associates,
and Frank Colaccino, as amended by eight amendments thereto. This Amendment No.
9 amends and restates such Schedule 13D.
Item 1. Security and Issuer
This Schedule 13D relates to the Class B Common Stock, par value $.01 per
share (the "Shares"), of Dairy Mart Convenience Stores, Inc, a Delaware
corporation (the "Company"). The Company's principal executive offices are
located at One Vision Drive, Enfield, Connecticut 06082.
Item 2. Identity and Background
This statement is being filed jointly by the following reporting persons
and entities (collectively, the "Reporting Persons"): (i) DM Associates Limited
Partnership ("DM Associates"); (ii) New DM Management Associates I ("DM
Management I"); (iii) Robert B. Stein, Jr.; (iv) Gregory G. Landry; and (v)
Mitchell J. Kupperman. Each Reporting Person disclaims membership in a "group,"
within the meaning of Rule 13d-1(f)(2) and Rule 13d-5(b)(1) of the Securities
Exchange Act of 1934, as amended (the "Act").
a. DM Associates. DM Associates is a Connecticut limited partnership
whose general partner is DM Management I and whose limited partners are HNB
Investment Corp. ("HNB") and the Company. DM Associates' principal business is
holding the 1,858,743 Shares described herein.
b. DM Management I. DM Management I is a Connecticut general partnership
whose general partners are Messrs. Stein, Landry, and Kupperman. The principal
business of DM Management I is to serve as a general partner of DM Associates.
c. Information Regarding Individuals. Set forth below are the name,
business or residence address and principal occupation of each of the Reporting
Persons who are individuals.
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<TABLE>
<CAPTION>
Business or Principal
Name Residence Address Employment
<S> <C> <C>
Robert B. Stein, Jr. One Vision Drive Chief Executive
Enfield, CT 06082 Officer of the Company
Gregory G. Landry One Vision Drive Executive Vice
Enfield, CT 06082 President, Treasurer
and Chief Financial
Officer of the Company
Mitchell J. Kupperman 115 Quinneahtuk Rd.
Longmeadow, Ma 01106
</TABLE>
All of the foregoing individuals are United States citizens.
None of the persons or entities set forth above has, during the last five
years: (i) been convicted in a criminal proceeding (excluding traffic violations
or similar misdemeanors); or (ii) been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction in which such person
was subject to a judgment, decree or final order enjoining future violations of,
or prohibiting or mandating activities subject to, federal or state securities
laws or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other
Consideration
In March 1992 DM Associates purchased in cash from certain stockholders of
the Company, as described in Item 4 below, 1,233,743 Shares at $12.00 per share,
aggregating $14,804,916 (the "Purchase Price"). In addition, 625,000 Shares were
contributed to DM Associates by: (i) Mr. Nirenberg, who contributed 616,667
Shares; and (ii) the Foundation, a charitable foundation controlled by Mr.
Nirenberg, which contributed 8,333 Shares, as described in Item 4 below.
The source of funds for the Purchase Price was: (i) a $7,100,000 loan (the
"Loan") to DM Associates by the Connecticut Development Authority ("CDA")
pursuant to a certain Loan Agreement (the "Loan Agreement") dated March 12,
1992, between DM Associates and the CDA; and (ii) cash equity contributions to
DM Associates by certain of its partners. The Loan was secured by a collateral
pledge to the CDA by DM Associates of 1,220,000 Shares (the "Pledged Shares"),
pursuant to a Stock Pledge Agreement (the "Stock Pledge Agreement") dated March
12, 1992, between DM Associates and the CDA. 638,743 of the Shares have not been
pledged. The Loan will mature and be due and payable on July 31, 1997.
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Each Share of Class B Common Stock has voting rights equal to that of ten
times the voting power of each share of Class A Common Stock. The Shares owned
directly by DM Associates represent approximately 60.7% of the total voting
power of all the issued and outstanding shares of Class A Common Stock and Class
B Common Stock combined.
On September 30, 1994, FCN Properties Corporation, a corporation owned by
Charles Nirenberg, a former officer and director of the Company, purchased the
Loan from CDA. On December 1, 1995, the Company purchased the Loan from FCN. The
Pledged Shares are now pledged to the Company as collateral for the Loan.
Item 4. Purpose of Transaction
Mr. Nirenberg, his wife Janet Nirenberg, The Nirenberg Foundation, Inc.
(the "Foundation") and the Janet Nirenberg 1987 Trust and the Charles Nirenberg
Charitable Remainder Trust, sold 1,233,743 Shares to DM Associates for $12.00
per share pursuant to a Stock Purchase Agreement dated March 12, 1992. In
addition, Mr. Nirenberg and the Foundation contributed to DM Associates 625,000
Shares in exchange for limited partnership interests in DM Associates, pursuant
to a Contribution and Exchange Agreement dated March 12, 1992.
The general partner of DM Associates, DM Management I, is a Connecticut
general partnership whose managing general partner is Robert B. Stein, Jr., the
Chief Executive Officer of the Company. Mr. Stein became the managing general
partner of DM Management I on December 1, 1995, upon the withdrawal of Charles
Nirenberg as a partner of DM Management I. Such withdrawal by Mr. Nirenberg was
effected by Mr. Nirenberg in accordance with the terms of an Agreement pursuant
to which, among other things, the Company purchased all of Mr. Nirenberg's
beneficial interest in his limited partnership interest in DM Associates and Mr.
Nirenberg agreed to resign from, and to cause M. Howard Jacobsen and Thomas
O'Brien to resign from, the Board of Directors of the Company.
Pursuant to the Partnership Agreement of DM Associates, DM Management I has
the right to determine the manner in which the Shares owned by DM Associates are
voted. Gregory Landry, Robert B. Stein, Jr., and Mitchell Kupperman each own
one-third of the partnership interests of New DM Management Associates I.
Pursuant to the Partnership Agreement of DM Management I, 638,743 of the Shares
owned by DM Associates will be voted in such manner as the holders of a majority
of the partnership interests of DM Management I may determine, and the balance
of 1,220,000 of the Shares owned by DM Associates will be voted for or against
any motion or proposal presented for a vote of the holders of Class B Shares in
the same proportion as other Class B Shares (including the other
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638,743 owned by DM Associates) are voted for or against such motion or
proposal.
It is the current intention of DM Management I to cause 638,743 Shares of
DM Associates to be voted for the re-election of Messrs. Stein and Landry, as
well as Frank W. Barrett, John W. Everets, Jr., and J. Kermit Birchfield, Jr.,
as Class B Directors of the Company. Such Directors currently constitute, and
will if they are re-elected constitute, a majority of the members of the Board
of Directors of the Company.
Except as set forth above, none of the Reporting Persons has any plan or
proposal to: (i) change the number or the composition of the present Board of
Directors or management of the Company; (ii) acquire any additional securities
of the Company (other than the receipt of stock options and similar compensation
as management of the Company); or (iii) take any of the other actions set forth
in Item 4 of Schedule 13D.
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Item 5. Interest in Securities of the Issuer
The following table sets forth certain information concerning beneficial
ownership of Shares by each Reporting Person:
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY PERCENT OF
NAME OF REPORTING PERSON OWNED CLASS (1)
<S> <C> <C>
DM Associates 1,858,743 66.8% (2)
DM Management I 1,858,743 66.8% (3)
Robert B. Stein, Jr. 1,859,743 66.8% (4)
Gregory G. Landry 1,859,743 66.8% (5)
Mitchell J. Kupperman 1,873,347 67.3% (6)
</TABLE>
(1) Based on 2,783,060 Class B Shares issued and outstanding as of December 14,
1995.
(2) Voting and dispositive power with respect to the Shares (as defined in this
Schedule 13D) owned of record by DM Associates are held by its general
partner, DM Management I, subject to the consent of the limited partners of
DM Associates being required for any sale of more than 360,000 Shares.
(3) Voting power of 638,743 of the Shares owned of record by DM Associates is
held by its general partner, DM Management I. DM Management I will vote
such Shares in such manner as the holders of a majority of the partnership
interests of DM Management I may determine. Robert B. Stein, Jr., Gregory
Landry and Mitchell Kupperman each own one-third of the partnership
interests of DM Management I. The other 1,220,000 Shares owned of record by
DM Associates will be voted for or against any stockholder motion or
proposal in the same proportion that all other Shares are voted for or
against such motion or proposal (including the 638,743 Shares voted by DM
Associates). Dispositive power with respect to the Shares owned of record
by DM Associates is held by DM Management I, subject to the consent of the
limited partners of DM Associates being required for any sale of more than
360,000 Shares. Robert B. Stein, Jr., as the managing general partner of DM
Management I, has the power to dispose of the Shares on behalf of DM
Management I.
(4) Includes: 1,858,743 Shares as to which Mr. Stein has sole dispositive
power, as the managing general partner of DM Management I, and shares
voting power with Messrs. Landry and Kupperman, as general partners of DM
Management I. Mr. Stein, as an officer and director of the Company, also
has shared voting and dispositive power of the Shares pledged to the
Company as the pledgee under the Stock Pledge Agreement, with
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respect to 1,220,000 of the 1,858,743 Shares listed in this Note 4. Does
not include 72,631 shares of Class A Common Stock beneficially owned by Mr.
Stein, 67,361 of which are subject to currently exercisable options.
(5) Includes: 1,858,743 Shares as to which Mr. Landry shares voting power with
Messrs. Stein and Kupperman, as general partners of DM Management I. Mr.
Landry, as an officer and director of the Company, also has shared voting
and dispositive power of the Shares pledged to the Company as the pledgee
under the Stock Pledge Agreement, with respect to 1,220,000 of the
1,858,743 Shares listed in this Note 5. Does not include 48,793 shares of
Class A Common Stock subject to currently exercisable options which are
beneficially owned by Mr. Landry.
(6) Includes: (i) 14,604 Shares which Mr. Kupperman beneficially owns
individually and has sole voting and dispositive power, and (ii) 1,858,743
Shares as to which Mr. Kupperman shares voting power with Messrs. Stein and
Landry, as general partners of DM Management I. Does not include 103,295
shares of Class A Common Stock beneficially owned by Mr. Kupperman, 97,500
of which are subject to currently exercisable options.
Each Reporting Person expressly declares that such Reporting Person is not
part of a "group," within the meaning of Rule 13d-1(b)(2) and Rule 13d-5(b)(1)
of the Act, with any other Reporting Person and that the filing of this Schedule
13D by each Reporting Person shall not be construed as an admission that such
Reporting Person is, for purposes of Section 13(d) or 13(g) of the Act, the
beneficial owner of any Shares reported in this Schedule 13D other than the
Shares listed next to the Reporting Person's name in the column "Shares
Beneficially Owned" in the foregoing table.
During the past sixty days, none of the Reporting Persons has effected any
transactions in the Shares, except for the transactions set forth herein.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
DM Management I, as the managing general partner of DM Associates, has the
right to exercise all voting, dispositive and other rights with respect to the
1,858,743 Shares (the "DM Management I Shares") held by DM Associates. DM
Management I cannot dispose of more than 360,000 of the DM Management I Shares
without the prior approval of the DM Associates limited partners owning at least
60% of the percentage interests of DM Associates. The Company and HNB are the
only limited partners of DM Associates whose limited partnership interests
aggregate 60% or more of the
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percentage interests of DM Associates. In addition, the partnership agreement of
DM Associates provides that, prior to voting the DM Management I Shares, DM
Management I shall consult with HNB as to the voting of such Shares. If, after
consultation with HNB, DM Management I votes the DM Management I Shares in a
manner with which HNB disagrees, HNB shall have the right to dissolve DM
Associates.
DM Management I will vote 638,743 DM Management I Shares in such manner as
the holders of a majority of the partnership interests of DM Management I may
determine. The other 1,220,000 DM Management I Shares will be voted for or
against any stockholder motion or proposal in the same proportion that all other
DM Management I Shares are voted for or against such motion or proposal
(including the 638,743 DM Management I Shares voted by DM Associates).
Pursuant to the partnership agreement of DM Management I, Mr. Stein, as
managing general partner of DM Management I, cannot exercise voting rights with
respect to the DM Management I Shares, unless he obtains the consent of general
partners owning a majority of the percentage interests of DM Management I (which
may include the percentage interest owned by Mr. Stein). If Mr. Stein fails to
vote the DM Management I Shares in such a manner as the partners representing a
majority of the percentage interests of DM Management I direct, then such Shares
may be voted by the general partners owning a majority of the percentage
interests. Mr. Stein, Mr. Landry and Mr. Kupperman each own one-third of the
percentage interests of DM Management I. Mr. Stein, as managing general partner
of DM Management I, has the right to exercise all dispositive power with respect
to the DM Management I Shares.
The partnership agreement of DM Associates provides in Section 6.7 thereof
for certain priorities and preferences with respect to distributions to the
partners, which Section is specifically incorporated herein by reference.
In addition, the Loan Agreement and Stock Pledge Agreement require the
consent of the Company before the Pledged Shares owned by DM Associates can be
voted for certain events or transactions, including dissolution of the Company,
merger of the Company, acquisition of the Company by any other person and
amendment of the charter of the Company in a manner that would effect a change
in the preference or priority of the Shares or which would violate or result in
a default under the Loan Agreement. The Loan Agreement also provides that a
default of the Loan will occur upon certain events occurring, as set forth in
Section 6.1 of the Loan Agreement, which section is incorporated herein by
reference. If a default occurs under the Loan Agreement, the Company has the
right to sell or otherwise dispose of the Pledged Shares pursuant to the
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Stock Pledge Agreement. Unless such a default occurs, DM Associates has the
right to vote the Pledged Shares, subject to the provisions set forth in above
and subject to having received the required consents of the Company as set forth
above with respect to certain matters.
Item 7. Material to be Filed as Exhibits
The following are filed as Exhibits to this Schedule 13D:
Exhibit A - Loan Agreement dated March 12, 1992, between DM Associates and CDA.
Incorporated herein by reference to Exhibit A of the Schedule 13D,
dated March 12, 1992, filed by DM Associates, DM Management
Associates, and Frank Colaccino.
Exhibit B - Stock Pledge Agreement dated March 12, 1992, between DM Associates
and CDA. Incorporated herein by reference to Exhibit B of the
Schedule 13D, dated March 12, 1992, filed by DM Associates, DM
Management Associates, and Frank Colaccino.
Exhibit C - Stock Purchase Agreement dated March 12, 1992, among DM Associates
and the Selling Stockholders. Incorporated herein by reference to
Exhibit C of the Schedule 13D, dated March 12, 1992, filed by DM
Associates, DM Management Associates, and Frank Colaccino.
Exhibit D - Contribution and Exchange Agreement dated March 12, 1992, among DM
Associates, Mr. Nirenberg and the Foundation. Incorporated herein
by reference to Exhibit D of the Schedule 13D, dated March 12,
1992, filed by DM Associates, DM Management Associates, and Frank
Colaccino.
Exhibit E - DM Associates Limited Partnership Agreement dated March 12, 1992.
Incorporated herein by reference to Exhibit E of the Schedule 13D,
dated March 12, 1992, filed by DM Associates, DM Management
Associates, and Frank Colaccino.
Exhibit F - First Amendment to Partnership Agreement of DM Associates Limited
Partnership dated as of September 8, 1994. Incorporated herein by
reference to Exhibit F of Amendment No. 4 to this Schedule 13D,
dated January 27, 1995, filed by DM Associates, DM Management I, DM
Management II, and Messrs. Landry, Stein, Colaccino, Nirenberg, and
Kupperman.
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Exhibit G - Partnership Agreement of New DM Management Associates I dated as of
September 8, 1994. Incorporated herein by reference to Exhibit G of
Amendment No. 4 to this Schedule 13D, dated January 27, 1995, filed
by DM Associates, DM Management I, DM Management II, and Messrs.
Landry, Stein, Colaccino, Nirenberg, and Kupperman.
Exhibit H - First Amendment of Partnership Agreement of New DM Management
Associates I dated as of December 1, 1995. Incorporated herein by
reference to Exhibit 10.10 of Form 10-Q for the Quarterly Period
Ended October 28, 1995, filed by Dairy Mart Convenience Stores,
Inc.
Exhibit I - Section 6.7 of DM Associates Limited Partnership Agreement.
Exhibit J - Section 6.1 of Loan Agreement.
Exhibit K - Agreement dated October 30, 1995, among Dairy Mart Convenience
Stores, Inc., Charles Nirenberg, FCN Properties Corporation, The
Nirenberg Family Charitable Foundation, Inc. and, solely for
purposes of Sections 8, 10(f), 10(h), 10(i) and 11 thereof, Robert
B. Stein, Jr. and Gregory G. Landry. Incorporated herein by
reference to Exhibit B of Amendment No. 8 to this Schedule 13D,
dated October 30, 1995, filed by DM Associates, DM Management I,
and Messrs. Nirenberg, and Kupperman.
Exhibit L - Modification Agreement dated December 1, 1995, among Dairy Mart
Convenience Stores, Inc., Charles Nirenberg, FCN Properties
Corporation, The Nirenberg Foundation, Inc., Robert B. Stein, Jr.
and Gregory G. Landry. Incorporated herein by reference to Exhibit
10.6 of Form 10-Q for the Quarterly Period Ended October 28, 1995,
filed by Dairy Mart Convenience Stores, Inc.
Exhibit M - Agreement relating to the joint filing of this Schedule 13D as
required by Rule 13d-1(f).
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EXHIBIT I
SECTION 6.7 OF DM ASSOCIATES LIMITED PARTNERSHIP AGREEMENT
Section 6.7 - Allocation of Net Profits and Net Loss from Capital
Transactions Upon a Liquidation of the Partnership.
(a) Except as provided in Section 6.8, all Net Profits of the
Partnership in connection with a dissolution and winding up of the Partnership
shall be allocated to the Partners and/or the Special General Partner in the
following manner and priority:
(1) First, to the Class A Limited Partner until the positive balance
in the Capital Account of the Class A Limited Partner is equal to the sum of the
Unrecovered Capital of the Class A Limited Partner and the 6% Preferred Return;
(2) Then, to the Class B Limited Partners until the positive balance
in the Capital Account of the Class B Limited Partners is equal to the
Unrecovered Capital of the Class B Limited Partners.
(3) Then, to the Class A Limited Partner until the positive balance in
the Capital Account of the Class A Limited Partner is increased by an amount
equal to the Balance of the Class A Limited Partner's 9% Preferred Return;
(4) Then, to the Class B Limited Partners until the positive balance
in the Capital Account of the Class B Limited Partners is increased by an amount
equal to the 9% Preferred Return;
(5) Then, to the General Partner until the positive balance of the
Capital Account of the General Partner is equal to the Unrecovered Capital of
the General Partner;
(5A) Then, to the Special General Partner until the positive balance
of the Capital Account of the Special General Partner is equal to the
Unrecovered Capital of the Special General Partner.
(6) Then, to the Limited Partners until the positive balance in the
Capital Account of the Limited Partners is increased by an amount equal to the
Balance of the Limited Partners' 15% Preferred Return under Section 6.3(g);
(7) Then, to the Class B Limited Partners and the General Partner
until the positive balance in their Capital Accounts is
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increased by the Balance of the Special 15% Priority that is or was distributed
to such Partners under Section 6.3(h);
(8) Next, to the General Partner until the positive balance in the
Capital Account of the General Partner is increased by an amount equal to the
15% Preferred Return;
(9) Thereafter, to the Partners and/or the Special General Partner in
accordance with, and in proportion to the amounts received, or to be received,
by them pursuant to Section 6.3(j).
(b) Net Losses from Capital Transactions upon a liquidation of the
Partnership shall be allocated first to those Partners and/or the Special
General Partner with positive Capital Account balances, pro rata, until such
Capital Account balances have been reduced to zero. The balance of Net Losses,
if any, shall be allocated, pro rata, in accordance with the Partners'
Percentage Interests.
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EXHIBIT J
SECTION 6.1 OF LOAN AGREEMENT
6.1 Events of Default
Each of the following is an Event of Default under this Agreement:
(a) The failure of the borrower to make payment of principal and/or
interest due under the Note when due;
(b) the failure of the Borrower to pay any amount due the Authority
pursuant to Section 5.2 or Section 5.3 or any other Secured Obligations within
the time prescribed by this Agreement, and if no time is prescribed, within
thirty (30) days of demand therefor made by the Authority;
(c) the inaccuracy in any material respect of any representation made by or
on behalf of the Borrower or the Company in the Loan Application, this Agreement
or any of the other Financing Documents, provided that, if such inaccuracy is
susceptible to cure, such inaccuracy continues for thirty (30) days after notice
thereof from the Authority;
(d) the material breach by the Borrower of any of its warranties in Section
4 of this Agreement or in any of the other Financing Documents, provided that,
if such breach is susceptible to cure, such breach continues for thirty (30)
days after notice thereof from the Authority;
(e) the failure, for thirty (30) days after notice thereof from the
Authority, of the Borrower to observe or perform any other covenant or agreement
of the Borrower in this Agreement, including but not limited to Section 5, or in
any of the other Financing Documents;
(f) the failure, for thirty (30) days after notice thereof from the
Authority, of the Company to perform or observe, or to cure any breach of, any
term or condition set forth in the Company Letter, whether expressed as a matter
of intent, warranty or agreement and without regard to whether such term or
condition is enforceable against the Company or such failure by the Company is
excusable as a matter of law;
(g) the occurrence of any event of default under the Credit Agreement and
either (i) the declaration by the Agent of the termination of any lending
commitment thereunder, or (ii) the acceleration of, or notice by the Agent of
the acceleration of, the maturity of any indebtedness due thereunder;
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(h) without the authority's prior written consent, (i) the disposition of
assets by the Company (including by way of the disposition of the stock or
assets of any Subsidiary) in any one fiscal year of an aggregate net book value
in excess of $10,000,000 other than in the ordinary course of business, or which
causes the Company's Consolidated Tangible Capital (as defined in the Credit
Agreement as of the date hereof, except that for purposes hereof the aggregate
outstanding principal amount of the Company's Subordinated Debentures (also as
defined in the Credit Agreement) shall be excluded from Consolidated Tangible
Capital) to fall below $11,000,000, (ii) the dissolution or liquidation of the
Company, (iii) the merger or consolidation of the Company into or with any other
Person, (iv) the acquisition of the Company by any other Person, or (v) any
amendment to the Restated Certificate of Incorporation of the Company effecting
any change in the provisions with respect to the Class B Common Stock, or the
preference or priority of any class or series of capital stock of the Company
relative to the Class B Common Stock, or which would violate or result in the
violation of any other provisions of the Financing Documents or constitute or
result in a Default or Event of Default.
(i) without the Authority's prior written consent, the issuance of any
additional shares of common stock of the Company or of any securities
convertible into shares of common stock of the Company, except
(1) common stock issued to employees, officers and directors pursuant
to and within the limits of the Company's stock option and employee stock
purchase plans as described in and in existence as of the date of the Company's
1991 Proxy Statement; and
(2) additional shares of common stock or convertible securities the
issuance of which does not result in a reduction, which in the reasonable
judgment of the Authority is material, in either book value per share or
earnings per share for the Company's common stock on a fully-diluted basis
(giving effect to the issuance of such additional shares of common stock or
convertible securities) below the book value per share and earnings per share,
respectively, reported by the Company for the fiscal year ended February 1, 1992
(the "Target Amounts per Share");
and provided further that, following the issuance of any such common stock or
convertible securities otherwise permitted under clause (1) or (2) hereof, the
common stock of the Company owned by the Borrower continues to represent at
least 51% of the voting power of the Company's common stock generally. For
purposes of this subparagraph (i): (A) the Target Amounts per Share shall be
adjusted appropriately for the effect of any stock split, stock dividend,
recapitalization or similar event otherwise permitted under this Agreement; (B)
earnings after giving effect to the
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issuance of such additional shares of common stock or convertible securities
shall be deemed to be the sum of (y) the Company's net income for its most
recent four fiscal quarters for which results are then publicly available, and
(z) an amount equal to the after-tax savings that would be reasonably expected
to result over the twelve-month period following the date of such issuance if
the net proceeds to the Company of such issuance were applied to the repayment
of principal outstanding under the Credit Agreement, assuming for purposes
hereof that the borrowing rate for such twelve-month period was the borrowing
rate in effect under the Credit Agreement on the date of such issuance; (C) any
non-cash net proceeds realized from the issuance of such additional shares of
common stock shall be valued for the purposes of clause (B) above at the market
value of the Company's common stock issued in consideration thereof; and (D) the
effect of the issuance of convertible securities on earnings per share, book
value per share and voting control shall be determined on the date that the
convertible securities are issued (as if the securities were converted, for the
conversion price, on the date of issuance), rather than on the date that such
securities are in fact converted.
(j) the creation or issuance of any class of capital stock of the Company
having any preference or priority over the Class B Common Stock;
(k) the conversion by the Borrower of any of its Class B Common Stock into
the Company's Class A Common Stock;
(l) the failure of the Borrower or the Company generally to pay its debts
as such debts become due; and
(m) the entry of a decree or order for relief by a court having
jurisdiction in respect of the Borrower or the Company in an involuntary case
under the federal bankruptcy laws, as now or hereafter constituted, or any other
applicable federal or state bankruptcy, insolvency or other similar law, or the
appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of the Borrower or the Company or for any
substantial part of the Property of either, or the issuance of an order for the
winding-up or liquidation of the affairs of the Borrower or the Company and the
continuance of any such decree or order unstayed and in effect for a period of
60 consecutive days; or upon the commencement by the Borrower or the Company of
a voluntary case under the federal bankruptcy laws, as now or hereafter
constituted, or any other applicable federal or state bankruptcy, insolvency or
other similar law, or the consent by the Borrower or the Company to the
appointment of or taking possession by a receiver, liquidator, assignee,
trustee, custodian, sequestrator (or other similar official) of the Borrower or
the Company or for any substantial part of the property of either or
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the making by the Borrower or the Company of any assignment for the benefit of
creditors, or the taking of partnership or corporate action by the Borrower or
the Company, respectively, in furtherance of any of the foregoing.
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After reasonable inquiry and the best of our knowledge and belief, we
certify that the information set forth in this statement is true, complete and
correct as of this 19th day of December, 1995.
NEW DM MANAGEMENT ASSOCIATES I
By:/s/ Robert B. Stein, Jr.
Robert B. Stein, Jr.
Its Managing Partner
DM ASSOCIATES LIMITED PARTNERSHIP
By New DM Management Associates I
Its General Partner
By:/s/ Robert B. Stein, Jr.
Robert B. Stein, Jr.
Its Managing General Partner
/s/ Robert B. Stein, Jr.
Robert B. Stein, Jr.
/s/ Gregory G. Landry
Gregory G. Landry
/s/ Mitchell J. Kupperman
Mitchell J. Kupperman
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EXHIBIT M
The undersigned agree that a statement on Schedule 13D to be filed with the
Securities and Exchange Commission on December 19, 1995, will be filed on behalf
of each of them.
NEW DM MANAGEMENT ASSOCIATES I
By:/s/ Robert B. Stein, Jr.
Robert B. Stein, Jr.
Its Managing Partner
DM ASSOCIATES LIMITED PARTNERSHIP
By New DM Management Associates I
Its General Partner
By:/s/ Robert B. Stein, Jr.
Robert B. Stein, Jr.
Its Managing General Partner
/s/ Robert B. Stein, Jr.
Robert B. Stein, Jr.
/s/ Gregory G. Landry
Gregory G. Landry
/s/ Mitchell J. Kupperman
Mitchell J. Kupperman
24
