<PAGE>
<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
/X/ Annual report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 for the fiscal year ended
February 28, 1995; or
/ / Transition report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 for the transition period
from _______ to _______.
Commission file number: 33-12173
AMERICOLD CORPORATION
(Exact name of registrant as specified in its charter)
Oregon 93-0295215
(State of Incorporation) (I.R.S. Employer Id. No.)
7007 S. W. Cardinal Lane, Suite 135,
Portland, Oregon 97224
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including
area code: (503) 624-8585
------------
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
/X/ Yes / / No
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. /X/
Aggregate market value of voting stock held by non-affiliates on
May 1, 1995: $6,938,321 based upon the last known transaction in
the voting stock of the Company.
Number of shares outstanding of the registrant's common stock,
par value $.01 per share, as of May 1, 1995: 4,860,934 shares.
DOCUMENTS INCORPORATED BY REFERENCE
None
Exhibit Index located at page 78.<PAGE>
<PAGE> 2
AMERICOLD CORPORATION
FORM 10-K
INDEX
-----
Part I Page
- ------ ----
Item 1. Business 3
Item 2. Properties 10
Item 3. Legal Proceedings 13
Item 4. Submission of Matters to a Vote of
Security Holders 14
Part II
- -------
Item 5. Market for Registrant's Common Equity
and Related Stockholder Matters 14
Item 6. Selected Financial Data 15
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations 15
Item 8. Financial Statements and Supplementary Data 24
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure 25
Part III
- --------
Item 10. Directors and Executive Officers of the
Registrant 25
Item 11. Executive Compensation 28
Item 12. Security Ownership of Certain Beneficial
Owners and Management 36
Item 13. Certain Relationships and Related Transactions 39
Part IV
- -------
Item 14. Exhibits, Financial Statement Schedules and
Reports on Form 8-K 39
SIGNATURES 48
SUPPLEMENTAL INFORMATION 49
EXHIBIT INDEX 78
<PAGE>
<PAGE> 3
PART I
Item 1. Business
GENERAL
- -------
Americold Corporation ("Americold" or the "Company") is the
nation's largest supplier of refrigerated warehouse services for
the frozen food industry. The Company also provides transportation
management services for frozen food shippers. Services are
provided through the Company's national network of 51 refrigerated
warehouses and through the Company's refrigerated transportation
management unit. The Company provides these and other services
either separately or in conjunction with warehousing services. The
Company also operates a limestone quarry, and previously operated
a vital records center, which it closed during fiscal 1994.
Americold, an Oregon corporation, was founded in 1911,
reincorporated in 1931 and, prior to 1984, operated as The Terminal
Ice and Cold Storage Company and, subsequently, Termicold
Corporation. In December 1982, Americold was acquired by Beatrice
Companies, Inc. ("Beatrice"), which combined its public
refrigerated warehouse facilities, operating under various names,
with Americold. In December 1986, Americold was purchased (the
"Acquisition") by a private group consisting of affiliates of Kelso
& Company, Inc. ("Kelso"), certain institutional investors, and
certain key employees and members of Americold's management (the
"Management Group").
Subsequent to the end of fiscal 1995, Americold Corporation
solicited acceptances of a proposed prepackaged plan of
reorganization (the "Plan") under Chapter 11 of the United States
Bankruptcy Code from certain debtholders as a means of implementing
the Company's plan for restructuring a portion of its outstanding
indebtedness. On May 8, 1995, the Company received approval from
the classes of debtholders entitled to vote on the Plan and, on May
9, 1995, filed the Plan as approved with the United States
Bankruptcy Court for the District of Oregon. The Company is
debtor-in-possession in the proceedings. See Part I, Item 3. -
"Legal Proceedings."
As used herein, the terms "Americold" or the "Company" refer to
Americold Corporation and its subsidiaries unless the context
indicates otherwise. All references to fiscal 1993, 1994 and 1995
refer to the years ended the last day of February 1993, 1994 and
1995, respectively.
REFRIGERATED WAREHOUSES
- -----------------------
Since its founding in 1911, the Company has grown to become the
largest owner and operator of refrigerated warehouses in the United
States. The Company believes it supplies 16% of the total publicly
available freezer storage space in the country, based on the most
recent data (October 1993) published by the United States
Department of Agriculture and the data most recently prepared by<PAGE>
<PAGE> 4
the International Association of Refrigerated Warehousemen (the
"IARW"). As of the last day of February 1995, the Company's
network of 51 refrigerated warehouse facilities in fifteen states
provided a total storage capacity of approximately 230.3 million
cubic feet. Included in the Company's total of 230.3 million cubic
feet of storage capacity is approximately 2.2 million cubic feet of
storage capacity added as a result of the expansion of the Tomah,
Wisconsin facility in August, 1994, and 2.3 million cubic feet
added in Burley, Idaho in January 1995. Approximately 94% of the
storage space operated by the Company is freezer space (zero
degrees Fahrenheit and below), with the remaining space divided
between cooler space (28 degrees Fahrenheit and above) and
unrefrigerated dry storage space.
Most of the Company's warehouses may be classified as combination
production and distribution facilities, although some provide
solely production or distribution services. Production facilities
differ from distribution facilities in that they typically serve
one or a small number of customers located nearby. These customers
store large quantities of processed or partially processed products
in the facility until they are further processed or shipped to the
next stage of production or distribution. Distribution facilities
primarily serve customers who store smaller quantities of a larger
variety of finished products before they are shipped to end-users,
such as food retailers and food service companies.
During the past four years the Company has implemented new
management systems and performance standards in its warehouses.
The IBM AS400 warehouse management system was completed in
December 1992 to tie together into a single network with common
services all of the Company's locations. The Company believes that
the standardization of systems and procedures has improved the
quality and consistency of customer services, reduced costs and led
to the overall enhancement of performance. To further integrate
the Company's services, the Company, using new computer hardware
and a combination of purchased and internally developed software,
completed in March 1995 a transportation management system which is
fully integrated with the Company's warehouse management system.
The Company has developed several services ancillary to its
warehouse freezer operations and intends to continue developing and
promoting such services as well as adding incremental freezer,
cooler or dry space. Ancillary services include the use of
electronic data interchange to receive and transmit product flow
and status information to the Company's customers, and SUPERCOLD
[registered trademark symbol] freezer storage provided at 11 of
Americold's facilities for the preservation of products, such as
ice cream, which require storage at temperatures as low as 20
degrees below zero (Fahrenheit). The Company also provides product
repacking and preparation of products for shipment, and the leasing
of warehouse space.
REFRIGERATED TRANSPORTATION MANAGEMENT
- --------------------------------------
The Company provides frozen food manufacturers with refrigerated
transportation management services either separately or in<PAGE>
<PAGE> 5
conjunction with warehousing services. Integrated services allow
frozen food manufacturers to contract with a single entity, the
Company, for warehousing and transportation services to the
manufacturer's ultimate customer. Transportation management
services, which are provided under the Company's own ICC authority
as a carrier or under ICC broker authority, include carrier and
mode selection, routing, dispatch, carrier rate negotiations,
carrier performance monitoring, claims management, freight payment
and load consolidation. The actual freight transportation is
performed by carriers who have negotiated rates with the Company.
The Company does not own and does not intend to own significant
transportation equipment.
In 1990, the Company united its freight consolidation activities
conducted at various warehouses into a single unit, Americold
Transportation Systems ("ATS"). Subsequently, in order to expand
the business of ATS, the Company formed alliances with
transportation providers and added staff resources and expertise in
logistics. The Company now has the ability to utilize its network
of IBM AS400 computers, its transportation management and
communications software and its multiple warehouse locations to
provide integrated warehousing and logistics services to its
customers.
In addition to these integrated transportation management and
warehousing services, the Company is working to develop services
that include demand forecasting, "flow-through logistics" and
"channel cost economic modeling" for its customers. Through its
investment in Non-Stop Logistics Corporation ("Non-Stop"), a
start-up venture, the Company is working to provide Non-Stop's
advanced forecasting technology to Americold's customers.
Non-Stop's forecasting technology is designed to be sufficiently
accurate to allow customers to predict demand in advance and to
send products to market area warehouses for rapid turn through the
warehouses ("flow-through logistics"). Also through Non-Stop, the
Company is working to provide channel cost economic modeling, which
is a methodology used to identify and track accurately per-case
costs of delivering products to individual markets. If Non-Stop is
ultimately successful, the Company, through an agreement with
Non-Stop, expects to be the principal provider of frozen storage,
handling and transportation services in Non-Stop's flow-through
environment. While there can be no assurance of Non-Stop's
success, the Company believes that its association with Non-Stop
will benefit the Company by providing it access to the latest
cost-savings technology relating to food and packaged goods
logistics.
In December 1994, the Company entered into an arrangement with one
of its largest customers to provide transportation management
services fully integrated with warehousing services. The customer
has begun transferring responsibility for transportation management
to the Company, and responsibility is expected to be fully
transferred by August 1995. In addition, the Company is working
with that customer and Non-Stop to develop a channel cost economic
model, to provide forecasting services, and to develop an
integrated logistics model. In February 1995, the Company signed
a letter of intent with another customer to provide similar<PAGE>
<PAGE> 6
transportation management services. The Company began providing
services to this second customer in May 1995.
REVENUES AND CUSTOMERS
- ----------------------
Americold's net sales for fiscal 1993, 1994 and 1995 are detailed
below by activity:
NET SALES (Dollars in Millions)
Fiscal 1993 Fiscal 1994 Fiscal 1995
------------ ------------ -------------
Amount % Amount % Amount %
------------- ------------ -------------
[S] [C] [C] [C] [C] [C] [C]
Storage $101.0 51.5% $ 98.5 49.5% $103.4 48.0%
Handling 60.3 30.8% 65.3 32.8% 70.7 32.9%
Freezing 6.2 3.2% 6.5 3.3% 7.6 3.5%
Leasing 9.5 4.8% 7.4 3.7% 7.0 3.3%
Other 3.8 1.9% 3.4 1.7% 3.8 1.8%
------ ----- ------ ----- ----- -----
Net warehousing
sales $180.8 92.2% $181.1 91.0% $192.5 89.5%
Quarry sales 2.8 1.4% 5.2 2.6% 4.7 2.2%
Vital record
center sales 0.4 0.2% - - - -
Transportation
management
services 12.1 6.2% 12.6 6.4% 18.0 8.3%
------ ----- ------ ----- ----- -----
Total net
sales $196.1 100.0% $198.9 100.0% $215.2 100.0%
====== ====== ====== ====== ====== ======
Americold's customers consist primarily of national, regional and
local frozen food processing firms, traders, wholesalers, retailers
and food service organizations. Although the Company provides
services to approximately 3,200 customers, in fiscal 1995 the 10
largest customers accounted for approximately 55% of total net
sales. One customer of the Company, H. J. Heinz Co. and
subsidiaries, accounted for approximately 21% of the Company's net
sales in fiscal 1995. The Company believes that the risk to the
Company of losing such large customers has been reduced in several
cases through long-term storage and operating agreements and by the
fact that services are provided to certain large customers in
multiple locations.
At several locations, the Company's production warehouses are
located adjacent to customers' processing facilities. Several of
the Company's customers guarantee a minimum quantity of product to
be stored in return for guaranteed space pursuant to long-term
contracts. At several locations, the Company leases space to
manufacturers or distributors on a long-term, fixed-rate basis. At
a number of facilities, particularly those located adjacent to
customers' processing facilities, a majority of, and in some cases
virtually all, business is attributable to a single user of the<PAGE>
<PAGE> 7
facility. Management has observed in the past, however, that to
the extent products produced at locations adjoining the Company's
facilities are commodities grown in the surrounding area, demand
for the products has been more significant to the long-term sales
and profitability of the facility than has been the viability of a
single producer.
SEASONALITY
- -----------
Warehousing sales are seasonal, depending upon the timing and
availability of crops grown for frozen food production and the
seasonal build-up of certain products for holiday consumption. The
third quarter, ending each November 30, normally represents the
strongest sales quarter. Capacity utilization at facilities varies
from season to season, with average annual capacity utilization of
approximately 70%. The Company generally keeps sufficient space
available at individual warehouses to meet peak season demand.
COMPETITION
- -----------
Americold operates in an environment in which location, customer
mix, warehouse size, breadth of service, service performance and
price are the principal competitive factors. Since frozen food
manufacturers and distributors incur transportation costs which
typically are significantly greater than warehousing costs,
location is a major competitive factor. In addition, in certain
locations, customers depend upon pooling shipments, which involves
combining their products with the products of others destined for
the same markets. In these cases, the mix of customers in a
warehouse can significantly influence the cost of delivering
products to markets. The size of a warehouse is important because
large customers prefer to have all of the products needed to serve
a given market in a single location and to have the flexibility to
increase storage at that single location during seasonal peaks.
The Company believes that customers generally will select a
warehouse facility based upon the types of services available,
service performance and price, if there are several warehouse
locations which satisfy its transportation, customer mix and size
requirements.
An additional competitive concern is that the Company's customers,
many of which have substantially greater resources than the
Company, may divert business from the public warehousing sector by
building their own refrigerated warehouse facilities.
Competition is national, regional and local in nature. There are
no significant barriers to entry, permitting a relatively large
number of smaller competitors to enter the Company's markets. On
the national level, Americold competes with United Refrigerated
Services, Inc. ("URS"), United States Cold Storage, Inc., Millard
Refrigerated Services and Christian Salvesen, Inc., which,
according to statistics compiled by the IARW, accounted for approx-
imately 6.3%, 4.2%, 2.7% and 2.2% of public freezer space,
respectively, in 1993. On the regional and local level, there are
many smaller warehouse operators that compete with the Company and,<PAGE>
<PAGE> 8
according to data prepared by the IARW, warehouse operators who own
or control less than 35 million cubic feet each of refrigerated
space or freezer space accounted for approximately 71% of all
public refrigerated storage space in 1993. The Company believes
that competition from these local and regional competitors is
significant because national competitors often do not compete in
the same markets as the Company. The Company also believes,
however, that if its strategy of integrating warehousing and
transportation management services is successful, the economies of
scale attendant to the movement of large quantities of diverse
products through its national network of warehouses will create a
marketing advantage not available to smaller competitors. Certain
companies, such as GATX Corporation and Exel Logistics, Inc.,
provide transportation management services to local shippers, but
not in conjunction with full service frozen food warehouse systems.
Kelso holds approximately 57% of the common equity of URS and,
therefore, owns a controlling interest in both the Company and URS.
Kelso has implemented procedures intended to address possible
conflicts of interest that might arise from its investment in both
URS and the Company. Kelso had considered on a preliminary basis
the possibility of a business combination between the Company and
URS. Kelso has terminated its consideration of such a business
combination at this time.
The Company continues to look for opportunities to add warehouse
locations and to expand its existing locations. While the Company
has added approximately 24 million cubic feet of freezer space over
the last seven years, and is currently in the process of
constructing approximately ten million additional cubic feet, the
public refrigerated warehouse industry has grown at a faster pace,
adding approximately 340 million cubic feet of freezer space
between 1987 and 1993 based on data prepared in October 1993 by the
USDA. As a consequence, the Company's national market share of
freezer space during such period decreased from approximately 18%
to approximately 16%. Although some of the freezer space added by
competitors has adversely affected the level of business at certain
of the Company's warehouses, the majority has been in areas where
the Company does not directly compete. The Company's ability to
capitalize on significant business opportunities in the future,
however, may be limited by its substantial leverage and
restrictions in its debt agreements.
ORGANIZATION
- ------------
The Company's operations are headquartered in Portland, Oregon, and
the Company maintains an office in Gloucester, Massachusetts. The
Company's warehouse facilities are organized into four districts.
Each district is managed by a District Manager to whom the
respective General Managers report. General Managers are
responsible for one to five warehouses and are supported at the
district and corporate levels by certain logistics, accounting,
marketing, engineering, data processing and operational functions.
<PAGE>
<PAGE> 9
SALES AND MARKETING
- -------------------
Sales responsibility at the Company resides primarily with district
and local management who are supported at the national level by
the Company's executive and sales and marketing staff. Marketing
is principally a corporate management function.
It is the responsibility of each warehouse's or group's management
to understand and be responsive to the needs of its individual
marketplace and to adapt sales efforts accordingly. Each General
Manager actively engages in the sales effort. Although the Company
operates nationally, prices charged by the Company tend to reflect
local market conditions.
Local sales efforts are supplemented by the national corporate
sales and marketing and logistics departments, which supplies sales
support, logistics analysis, account pricing guidance and
advertising, and monitors relationships with large district and
national accounts. The Company employs two sales managers and a
sales representative, all reporting to a director of sales in
Portland, Oregon. These sales managers are located in California
and Colorado, while the sales representative is located in
Massachusetts. In addition, a primary sales development and
pricing contact is assigned to each of the Company's top 100
accounts. Certain customers storing product in multiple
facilities, but who are not among the Company's top 100 accounts,
are also offered a similar contact.
EMPLOYEES
- ---------
The Company had approximately 1,889 employees as of February 28,
1995. A breakdown of employees by function is set forth below:
Employee Breakdown by Function
Number of Percentage
Function Employees of Total
- --------- --------- ----------
Warehouse Operations 1,485 78.6%
Transportation Management
Services (ATS) 19 1.0%
Sales and Marketing 4 0.2%
Administration (Warehouse
and Corporate) 381 20.2%
----- -----
Total 1,889 100.0%
====== ======
Approximately 673 of the Company's employees are covered by union
contracts. Currently, 26 facilities employ unionized labor, while
25 facilities are non-unionized. Union contracts for individual
locations are with the local chapters of national unions,
principally the International Brotherhood of Teamsters, and
generally have staggered expiration dates. During the past three <PAGE>
<PAGE> 10
years, there have been no strikes at the Company's facilities, and
the Company believes its relationships with its employees are
satisfactory.
As a result of the anticipated continued expansion in
transportation management services offerings, the size of the ATS
staff is expected to increase during fiscal 1996.
PATENTS, LICENSES AND TRADEMARKS
- --------------------------------
The Company's operations are not dependent upon any single or
related group of patents, licenses, franchises or concessions. The
Company's operations are also not dependent upon a single trademark
or service mark, although the Company has registered the Americold
[registered trademark symbol] and SUPERCOLD [registered trademark
symbol] service marks with the United States Patent and Trademark
Office.
RESEARCH AND PRODUCT DEVELOPMENT
- --------------------------------
The Company does not operate in an industry in which research and
development plays an important role. The Company, therefore, has
not made any material expenditure with regard to Company-sponsored
research and development in the past three fiscal years, nor has it
been involved in any material customer-sponsored research and
development activities during that period. The Company, however,
has made significant expenditures in developing and installing its
new computer data processing support system, which integrates state
of the art transportation management systems with the Company's
warehouse management system. The Company also continues to pursue
methods of reducing energy costs at its facilities.
ENVIRONMENTAL COMPLIANCE
- ------------------------
In fiscal 1995, the Company completed its conversion of its last
remaining freon-based cooling system to an ammonia-based system.
The Company's capital expenditures, earnings and competitive
position are not materially affected by compliance with federal,
state and local provisions which have been enacted or adopted
regulating the discharge of materials into the environment, or
otherwise relating to protection of the environment.
Item 2. Properties
As of February 28, 1995, the Company owned or leased 51 facilities
in 15 states. Although most of the facilities are owned by the
Company, 13 facilities comprising approximately 10.2% of the
Company's total cubic feet of storage space are leased or subleased
by the Company under operating-type lease arrangements. Four
facilities representing approximately 5.3% of the total cubic feet
of storage space are leased, in whole or in part, under
sale-and-leaseback or capitalized-type lease arrangements. Five
facilities, or portions thereof, representing approximately 7.2% of
the total cubic feet of storage space, are situated on leased land.<PAGE>
<PAGE> 11
Capacity utilization at facilities varies from season to season,
with average annual capacity utilization of approximately 70%. All
but five of the Company's owned warehouses are currently encumbered
as security for the senior secured debt of the Company.
The Company's facilities are typically single-story concrete
buildings constructed at dock height elevation, with very heavy
insulation and vapor barrier protection. Refrigeration is
typically supplied by screw-type compressors in ammonia-based
cooling systems. Facilities are served by truck as well as by
rail. In many instances buildings generally have sufficient land
space surrounding them to afford ample area for truck parking and
storage of unused pallets and equipment. Many facilities also have
room for expansion.
The following table lists the 51 refrigerated warehouse properties
owned or leased by the Company as of February 28, 1995. It also
shows the 31 facilities that presently secure the Company's first
mortgage bonds.
REFRIGERATED WAREHOUSE FACILITIES
Total
Storage
Space
(Cubic Type of Owned or
Ft./Mil) Facility(*) Leased
------- -------- -------
Burbank (W. Magnolia Blvd.),
California 0.8 P/D Owned
Fullerton (S. Raymond Ave.),
California 4.0 P/D Leased(1)
Los Angeles (Corona St.),
California 0.7 D Leased(1)
Los Angeles (Jesse St.),
California 2.7 P/D Owned(4)
Oakland (E. 11th St.),
California 1.9 D Leased(1)
Pajaro (Salinas Rd.),
California 0.8 P/D Leased(1)
San Francisco
(Donner Ave.), California 2.5 D Leased(1)
Turlock (5th St.),
California 2.5 P/D Owned(4)
Turlock (S. Kilroy Rd.),
California 3.0 P/D Owned(4)
Watsonville (W.
Riverside Dr.), California 5.2 P/D Owned(2)(4)
Watsonville (Second St.),
California 1.5 P/D Leased(1)
Watsonville (Hwy One),
California 3.6 P/D Leased(1)
Denver (E. 50th St.), Colorado 2.8 P/D Owned(2)/
Leased(3)(4)
<PAGE>
<PAGE> 12
Denver (N. Washington St.),
Colorado 0.5 P/D Leased(1)
Bartow (U. S. Highway 17),
Florida 1.2 P/D Owned(2)(4)
Plant City (S.
Alexander St.), Florida 0.9 P/D Owned
Tampa (N. 50th St.), Florida 4.1 P/D Owned/
Leased(3)
Tampa (S. Lois Ave.), Florida 0.4 D Owned
Tampa (Shoreline Dr.), Florida 0.8 D Owned(2)
Burley (U.S. Highway 30), Idaho 7.8 P/D Owned(2)(6)
Nampa (4th St. N.), Idaho 8.0 P Owned(4)
Chicago (S. State St.), Illinois 2.9 P/D Leased(1)
Chicago (S. Blue Island
Ave.), Illinois 2.9 P/D Leased(1)
Bettendorf (State St.), Iowa 8.9 P/D Owned(4)
Fort Dodge (Maple Dr.), Iowa 3.7 D Owned(4)
Kansas City (Inland Dr.), Kansas 35.2 P/D Owned(4)
Portland (Read St.), Maine 1.8 P/D Owned
Boston (Widett Ci.), Massachusetts 3.1 P/D Owned(4)
Gloucester (E. Main St.),
Massachusetts 1.9 P/D Owned(4)
Gloucester (Railroad Ave.),
Massachusetts 0.3 P/D Owned(4)
Gloucester (Rogers St.),
Massachusetts 2.8 P/D Owned(4)
Gloucester (Rowe Sq.),
Massachusetts 2.4 P/D Owned(4)
Watertown (Pleasant St.),
Massachusetts 4.7 P/D Owned(4)
Brooks (Brooklake Rd.), Oregon 4.8 P Owned(4)
Hermiston (Westland Rd.), Oregon 4.0 P Owned(4)
Hillsboro (W. Washington
St.), Oregon 1.1 P/D Leased(1)(7)
Milwaukie (S. E. McLoughlin
Blvd.), Oregon 4.7 D Owned(4)
Ontario (N. E. First St.), Oregon 8.1 P Leased(5)
Salem (Portland Rd. N.E.), Oregon 12.5 P/D Owned(4)
Woodburn (Silverton Rd.), Oregon 6.3 P/D Owned(4)
Fogelsville (Mill Rd.),
Pennsylvania 14.0 D Owned/
Leased(3)(4)
Murfreesboro (Stephenson Dr.),
Tennessee 2.9 P/D Owned(4)
Clearfield (South St.), Utah 8.6 P/D Owned(4)
Burlington (S. Walnut),
Washington 4.7 P/D Owned(4)
Connell (W. Juniper St.),
Washington 5.7 P Owned(4)
Kent (S. 190th St.),
Washington 1.0 D Leased(1)
Moses Lake (Wheeler Rd.),
Washington 7.3 P/D Owned(4)
Walla Walla (4-14th Ave. S.),
Washington 3.1 P Owned(4)
Wallula (Dodd Rd.), Washington 1.2 P/D Owned(4)<PAGE>
<PAGE> 13
Plover (110th St.), Wisconsin 9.4 P/D Owned(4)
Tomah (Route 2), Wisconsin 4.6 P Owned(4)
-----
230.3
=====
____________________________
(*) "P" designates a production facility.
"D" designates a distribution facility.
"P/D" designates a facility that is used for both production
and distribution.
(1) Operating lease.
(2) Building owned by the Company; land is leased.
(3) Capitalized lease.
(4) Security for Company's first mortgage bonds. See Note
7 to Consolidated Financial Statements.
(5) Financing lease.
(6) Security for mortgage payable.
(7) Lease terminated May 1995.
Item 3. Legal Proceedings
On May 9, 1995, subsequent to the end of fiscal 1995, the Company
filed a prepackaged plan of reorganization under Chapter 11 of the
United States Bankruptcy Code in the United States Bankruptcy Court
for the District of Oregon (the "Court") (Case No. 395-33058elp11).
The principal purpose of the Plan is to reduce the Company's short-
term cash requirements with respect to payments due on its
subordinated indebtedness and to adjust certain restrictive
financial covenants and certain other provisions contained in the
Amended and Restated Investment Agreement (the "Old Investment
Agreement"), dated March 2, 1993, between the Company and
Metropolitan Life Insurance Company (the "Institutional Investor").
On the filing date, the Plan had received approval from both of the
classes of debtholders entitled to vote on the Plan.
A hearing has been scheduled for June 19, 1995 to consider the
motion of the Company requesting the Court (1) to approve the
Company's Disclosure Statement dated April 14, 1995 and the
Company's procedure for solicitation of votes to accept or reject
the Plan, and (2) to confirm the Plan.
For additional information with respect to the Plan, see Part II,
Item 7. - "Management's Discussion and Analysis of Financial
Condition and Results of Operations -- Liquidity and Capital
Resources."
From time to time, the Company has been involved in litigation
relating to claims arising out of its operations in the regular
course of business. The Company has settled all of the material
lawsuits and claims filed in connection with the Kansas City fire.
The aggregate amount of all settlement payments for the litigation
and claims related to the Kansas City fire did not exceed the
amount of the Company's applicable insurance coverage and therefore
no cash payment by the Company was required. After resolution of
the lawsuits and claims, the Company applied the proceeds paid to
the Company by the Company's insurance carriers in the third <PAGE>
<PAGE> 14
quarter of fiscal 1995. See Item 2, "Management's Discussion and
Analysis of Financial Condition and Results of
Operations--Nine-Month Results," Form 10-Q dated January 17, 1995
for the quarter ended November 30, 1994.
As of May 9, 1995, the Company, excluding the above bankruptcy
proceeding, is not a party to any legal proceedings, the adverse
outcome of which would, in management's opinion, have a material
adverse effect on the Company's results of operations or financial
position. The Company maintains property, liability and
warehouseman's legal liability insurance in amounts which it
believes are consistent with industry practice and adequate for its
operations.
Item 4. Submission Of Matters To a Vote Of Security Holders
No matter was submitted by the Company to a vote of stockholders
during the fourth quarter of fiscal 1995.
PART II
Item 5. Market For Registrant's Common Equity and Related
Stockholder Matters
MARKET INFORMATION
- ------------------
The Company's common stock is not listed on a securities exchange
or traded through an interdealer quotation system. There is no
established public trading market for the Company's common stock.
However, there are occasional trades through certain
broker/dealers.
STOCKHOLDERS
- ------------
As of May 1, 1995, there were 4,860,934 shares of the Company's
common stock outstanding, held by approximately 84 stockholders of
record. See also response to Part III, Item 12.
DIVIDENDS
- ---------
No dividends have been declared by the Company on its common stock
since the Acquisition. The Company's credit agreements restrict
the payment of dividends on common stock, and it is the present
policy of the Board of Directors that all available cash be used
for the reduction of debt and for reinvestment in the Company's
business.<PAGE>
<PAGE> 15
Item 6. Selected Financial Data
The following table presents selected historical financial
information. The information should be read in conjunction with
the Company's Consolidated Financial Statements and related Notes,
and Management's Discussion and Analysis of Financial Condition and
Results of Operations as furnished below in Part II, Item 8 and
Item 7, respectively. Dollars are in thousands, except per share
data.
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended Year Ended Year Ended
last day last day last day last day last day
of of of of of
February February February February February
1991 1992 1993 1994 1995
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Income Statement
Data:
Net sales $196,927 $200,680 $196,130 $198,887 $215,207
Income (loss) before extra
ordinary item and cumulative
effect of accounting
principle change (9,716) (5,493) (8,150) (11,039) 5,564
Extraordinary
gain (loss), net of income
tax expense (benefit) 654 - - (1,848) -
Cumulative effect of
accounting principle changes - - - (64,234) -
Net income (loss) (9,062) (5,493) (8,150) (77,121) 5,564
Income (loss) per share:
Income (loss) before extra
ordinary item (2.06) (1.24) (1.80) (2.39) 1.00
Extraordinary item .13 - - (.38) -
Cumulative effect of
accounting principle
changes - - - (13.23) -
Net income (loss) per common
share (1.93) (1.24) (1.80) (16.00) 1.00
Cash dividends declared per
common share - - - - -
Balance Sheet Data:
Total assets $493,651 $483,841 $490,151 $528,703 $544,595
Long-term debt 449,299 435,133 443,003 467,337 442,912
Preferred stock 3,208 4,204 4,773 5,348 5,789
Common stockholders'
deficit (10,578) (16,882) (25,175) (102,577) (97,747)
</TABLE>
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations
INTRODUCTION
- ------------
Subsequent to the end of fiscal 1995, Americold Corporation
solicited acceptance of a proposed prepackaged plan of<PAGE>
<PAGE> 16
reorganization under Chapter 11 of the United States Bankruptcy
Code from certain debtholders as a means of implementing the
Company's plan for restructuring a portion of its outstanding
indebtedness. On May 8, 1995, the Company received approval from
the classes of debtholders entitled to vote on the Plan and, on May
9, 1995, filed the Plan as approved with the United States
Bankruptcy Court for the District of Oregon. The Company is
debtor-in-possession in the proceedings. See " - Liquidity and
Capital Resources."
The Company's operating results have been and will continue to be
materially affected by the transactions related to the Acquisition.
Operating results are affected by indebtedness incurred to finance
the Acquisition and by the amortization of capitalized fees and
expenses incurred in connection with such financing. For fiscal
1994 and 1995, interest expense, principally related to debt
incurred to finance the Acquisition, totaled $55.4 million and
$55.3 million, respectively, and the amortization of debt issuance
costs totaled $1.2 million and $1.3 million, respectively.
In December 1991 a fire began at the Company's Kansas City, Kansas
underground warehouse, the Company's largest warehouse facility.
Due to its underground location, the fire took several months to
extinguish. The fire was confined to an unrefrigerated area of the
warehouse; however, a significant amount of product in the
warehouse at the time of the fire sustained smoke damage.
As a result of the fire, the Company's warehousing activities in
Kansas City have operated at a substantially reduced level, due to
reduced warehouse volume and loss of public storage and lease
customers. The fire also caused the Company to discontinue its
vital record center storage operations. The Company abandoned 63%
of its less productive dry storage space and 11% of its freezer
space; however, the balance of the Kansas City, Kansas warehouse
facility has been restored to substantially its pre-fire condition.
The Company is, however, unable to predict its ability to return
the facility to pre-fire operating volumes and profits. While the
Company has had some success in rebuilding its public storage
business, revenue from the lease of space to third parties remains
significantly below pre-fire levels. The Company anticipates that
the adverse effects of the Kansas City fire on operating results
due to the loss of customers, especially lease customers, will
continue for at least the next several years.
In December 1994, the Company entered into an arrangement with a
major customer to provide transportation management services fully
integrated with warehousing services for that customer. The
contract is expected to be fully implemented by August 1995. In
February 1995, the Company signed a letter of intent with a second<PAGE>
<PAGE> 17
customer to provide similar transportation management services
which began in May 1995. The Company therefore expects that
revenue related to its transportation management services activity
may increase substantially in fiscal 1996. The amount of such
revenue depends upon the transition process and other factors. In
fiscal 1996, the Company does not expect the arrangements to have
a material effect on income.
HISTORICAL INCOME STATEMENT INFORMATION
- ---------------------------------------
The following table sets forth, for the fiscal years ended the last
day of February 1993, 1994 and 1995, respectively, certain
consolidated financial data for the Company, expressed as a
percentage of net sales, and the percentage changes in the dollar
amount as compared to the prior period.
<TABLE>
<CAPTION>
Percentage of Net Sales Period-to-Period
Change
Last Day of February --------------------
-------------------------------- 1993 to 1994 to
1993 1994 1995 1994 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net sales 100.0% 100.0% 100.0% 1.4% 8.2%
Cost of sales 60.6% 63.5% 64.2% 6.2% 9.4%
Amortization of cost in excess
of net assets acquired 1.3% 1.3% 1.2% (0.1)% 0.2%
Selling and administrative
expenses 13.9% 13.6% 12.1% (0.4)% (4.2)%
Employee stock ownership
plan expense 0.4% 0.0% 0.3% (100.00)% 100.0%
Gross operating margin 23.9% 21.6% 22.2% (8.2)% 11.3%
Interest expense 26.5% 27.9% 25.7% 6.7% (0.1)%
Amortization of debt issuance
costs 0.6% 0.6% 0.6% 6.5% 2.2%
Income (loss) before income taxes,
extraordinary item and cumulative
effect of accounting principle
changes (2.9)% (6.2)% 5.0% (114.6)% 188.3%
Provision (benefit) for income taxes 1.3% (0.6)% 2.4% (148.2)% 541.8%
Income (loss) before extraordinary
item and cumulative effect of
accounting principle changes (4.2)% (5.6)% 2.6% (35.4)% 150.4%
Extraordinary loss, net
of income tax benefit 0.0% (0.9)% 0.0% (100.0)% 100.0%
Cumulative effect of accounting
principle changes 0.0% (32.3)% 0.0% (100.0)% 100.0%
Net income (loss) (4.2)% (38.8)% 2.6% (846.3)% 107.2%
</TABLE>
<PAGE>
<PAGE> 18
RESULTS OF OPERATIONS
- ---------------------
NET SALES - The Company's net sales increased 8.2% from $198.9
million for fiscal 1994, to $215.2 million for fiscal 1995.
Warehousing sales increased 6.3% from $181.1 million for fiscal
1994 to $192.5 million for fiscal 1995, primarily due to a 5.0%
increase in storage revenue and an 8.3% increase in handling
revenue. The increase in storage revenue resulted from an increase
in storage volume of 5.0%. The increase in storage volume is due
primarily to the increased storage of vegetables, which is
attributable to a strong vegetable harvest in the Midwest in
calendar 1994.
The increase in handling revenue resulted primarily from an 11.7%
increase in volume of product handled. For fiscal 1994, 17.9
billion pounds of product were handled by the Company compared with
20.0 billion pounds in fiscal 1995. While handling volume
increased 11.7%, handling revenue increased only 8.3% due to
decreased special services revenue (classified by the Company as
handling revenue), changes in product mix and other factors.
Nonwarehousing sales increased 27.5% from $17.8 million for fiscal
1994 to $22.7 million in fiscal 1995, due primarily to increased
sales from ATS.
Net sales for fiscal 1994 were 1.4% higher than fiscal 1993. The
slight increase in warehousing sales was primarily the result of an
increase in handling revenue which was offset by a decrease in
storage revenue due to the reduction in certain frozen vegetable
stock, attributable primarily to the flooding in the Midwestern
United States in 1993. Nonwarehousing sales in fiscal 1994
increased primarily as a result of an increase in quarry sales,
again due in part to the flooding, as the demand for quarry
products increased.
COST OF SALES - Cost of sales increased $11.9 million or 9.4% from
$126.3 million for fiscal 1994 to $138.1 million for fiscal 1995.
Approximately $5.2 million of the increase was due to increased
volume at ATS, which requires corresponding increases in
transportation capacity purchased from carriers. The Company's
transportation management services business is in the development
stage and experienced losses of approximately $.8 million in fiscal
1995. Management expects the business to break even in fiscal
1996. Another $3.5 million of the increase in cost of sales was
primarily attributable to increased warehouse payroll expense
resulting from the increase in handling volume at the Company's
facilities.
<PAGE>
<PAGE> 19
Cost of sales as a percentage of net sales increased from 63.5% in
fiscal 1994 to 64.2% in fiscal 1995, as handling and ATS sales,
which have high variable cost requirements, increased from 39.2% of
total sales in fiscal 1994 to 41.2% in fiscal 1995.
Management has observed over the past several years a gradual shift
in its warehousing business mix to reflect an increasing percentage
of lower-margin handling revenue. However, management has not been
able to determine the extent to which this shift has been due to
the increased emphasis by customers on inventory turns, or due to
dislocations caused by severe crop losses in the 1993 Midwest
flooding. While management expects the underlying trend toward
lower margins to continue due to the planned growth of the
refrigerated transportation management business, the Company
believes that such activity is likely to also include related
increases in higher-margin storage business and a long-term
increase in earnings due to higher volumes in all lines of
business.
Cost of sales for fiscal 1994 was 6.2% higher than fiscal 1993 as
a result of the increased handling volume at the Company's
facilities, including the quarry.
SELLING AND ADMINISTRATIVE EXPENSES - Selling and administrative
expenses for fiscal 1994 were $27.1 million, as compared to $26.0
million for fiscal 1995, a decrease of 4.2%. The reduction
primarily reflects a decrease of approximately $0.5 million in
professional fees. The Company was able to reduce selling and
administrative expenses in an environment of increasing sales due
to an intensive program to reduce and restructure administrative
activities.
Selling and administrative expenses for fiscal 1994 were $27.1
million, a decrease of 0.4% from fiscal 1993. The decrease
primarily reflects a decrease in administrative payroll and related
fringe benefits.
INTEREST EXPENSE - Interest expense decreased from $55.4 million
for fiscal 1994 to $55.3 million for fiscal 1995, as a result of
slightly lower average borrowings during the fiscal year.
Interest expense increased from $51.9 million for fiscal 1993 to
$55.4 million for fiscal 1994, resulting from both the $26.25
million net increase in the principal amount of first mortgage
bonds outstanding, and from the new mortgage payable on the Burley,
Idaho warehouse facility.
GAIN ON INSURANCE SETTLEMENT - This one-time gain reflects the gain
on insurance settlement of approximately $17.0 million related to<PAGE>
<PAGE> 20
the Company's settlement with its insurance carriers of its first
party claims for business interruption losses, property damage and
out-of-pocket expenses incurred with respect to the Kansas City
fire.
INCOME - The Company's loss before income taxes, extraordinary item
and cumulative effect of accounting changes for fiscal 1994 was
$12.2 million, compared to income of $10.8 million in fiscal 1995.
The increase in income reported in the more recent period is
primarily the result of the insurance settlement referred to above.
The Company's loss before income taxes, extraordinary items and
cumulative effects of accounting changes for fiscal 1993 was $5.7
million compared to a loss of $12.2 million for fiscal 1994. The
principal reasons for the increased loss includes the increased
interest expense and increased cost of sales, discussed above.
EXTRAORDINARY LOSS - During the first quarter of fiscal 1994, the
Company completed a debt refinancing transaction related to the
first mortgage bonds which resulted in an extraordinary loss to the
Company, net of taxes, of approximately $1.8 million due to the
write-off of unamortized issuance costs.
INFLATION - The Company's operations have not been, nor are they
expected to be, materially affected by inflation or changing
prices.
NEW ACCOUNTING STANDARDS - Effective March 1, 1993, the Company
implemented Financial Accounting Standards Board Statement of
Financial Accounting Standard No. 106, "Employer's Accounting for
Postretirement Benefits Other Than Pensions", and Statement No.
109, "Accounting for Income Taxes." As a result of the
implementation of these accounting standards, the Company's fiscal
1994 earnings were reduced by approximately $64.2 million.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
LIQUIDITY
OPERATING CASH FLOW - The Company relies primarily upon cash
generated by operations to service debt and fund capital
expenditures. Net cash flow from operating activities as reported
in the Company's consolidated financial statements decreased from
$18.5 million for fiscal 1994 to $12.7 million for fiscal 1995.
The decrease is due primarily to an increase in trade receivables,
resulting from increased sales and changes in the timing of certain
cash collections, and from changes in the timing of the payment of
interest and certain other items. Cash and cash equivalents<PAGE>
<PAGE> 21
increased from $3.9 million at the end of fiscal 1994 to $33.2
million at the end of fiscal 1995 due primarily to the receipt of
the insurance proceeds relating to the Kansas City fire.
The Company's working capital position at fiscal 1995 year-end was
a negative $14.9 million. This position compares to a negative
$7.5 million at fiscal 1994 year-end. The decrease in working
capital was due primarily to an increase in accrued expenses and a
decrease in other receivables. The increase in accrued expenses is
a result of timing of certain payments, and the decrease in other
receivables is due to the receipt of the insurance proceeds.
SHORT-TERM CAPITAL RESOURCES - The commitment level at February 28,
1995 under the existing credit agreement ("Existing Credit
Agreement") with the Company's principal bank (the "Bank") was
$27.5 million, with a maximum of $20.0 million available for cash
borrowing. The maximum amount of letters of credit permitted to be
outstanding under the Existing Credit Agreement is $10.0 million.
Any amount by which letters of credit outstanding exceed $7.5
million under the Existing Credit Agreement reduces the available
cash borrowings by a like amount. In addition, the amount
available for cash borrowings is subject to further limitation by
the amount of eligible accounts receivable outstanding. Based upon
letters of credit outstanding and eligible accounts receivable as
of February 28, 1995, the Company had an available cash borrowing
capacity of $16.3 million, of which no amount was borrowed. The
Company had approximately $7.3 million of outstanding letters of
credit, principally related to leasing and workers' compensation
requirements.
DEBT SERVICE REQUIREMENTS - Payments due on long-term debt in the
first half of fiscal 1996 included an interest payment of $10.1
million paid on March 1, 1995 with respect to the first mortgage
bonds, and a sinking fund payment of $28.75 million and an interest
payment of $6.3 million due on May 1, 1995 with respect to the
Company's 11% Senior Subordinated Debentures due 1997 (the "Old
Subordinated Debentures"). As a result, the Company's estimated
cash requirements for debt service in the first quarter of fiscal
1996 were approximately $45 million. The Company had available
cash to make the March 1, 1995 interest payment on the first
mortgage bonds and had cash and available borrowings under the
Existing Credit Agreement to make the principal and interest
payments with respect to the Old Subordinated Debentures on May 1,
1995. However, if the Company had made the required May 1, 1995
principal and interest payments on the Old Subordinated Debentures
from available cash and borrowings under the Existing Credit
Agreement, the Company believes that such payments would have
created a default at the next measurement date (May 31, 1995) under
the pro forma debt service covenant (as defined) contained in the<PAGE>
<PAGE> 22
Old Investment Agreement, and a default under the Existing Credit
Agreement relating to an out-of-debt requirement as of June 30,
1995. Under such circumstances, the Institutional Investor and the
Bank could declare the principal of and accrued but unpaid interest
on all the first mortgage bonds and borrowings under the Existing
Credit Agreement to be immediately due and payable. Upon such a
declaration, such principal and interest and a premium thereon
would be classified as a current liability. The Company therefore
proposed the Plan to alleviate the Company's anticipated liquidity
shortfall and to avoid defaulting under its various debt
agreements.
The Plan provides, among other things, that:
(i) each holder of the Company's Old Subordinated Debentures
will receive, for each $1,000 principal amount of Old Subordinated
Debentures, $1,000 of the Company's 15% Senior Subordinated
Debentures due 2007 (the "New Subordinated Debentures"), and an
amount in cash equal to 100% of the accrued but unpaid interest on
the Old Subordinated Debentures up to but excluding the effective
date of the Plan;
(ii) the legal, equitable and contractual rights of each
holder of the Company's 11.45% First Mortgage Bonds, Series A due
2002 (the "Series A Bonds"), and the Company's 11 1/2% First
Mortgage Bonds, Series B due 2005 (the "Series B Bonds")
(collectively, the "First Mortgage Bonds"), under the Amended and
Restated Indenture, dated as of March 9, 1993, will be left
unaltered; and
(iii) the Old Investment Agreement between the Company and the
Institutional Investor will be superseded by the Second Amended and
Restated Investment Agreement (the "New Investment Agreement"),
which will contain certain financial and operating covenants that
in some cases are less restrictive than those contained in the Old
Investment Agreement, and pursuant to which (x) the Company will
redeem $10.0 million in principal amount of the Company's Series A
Bonds held by the Institutional Investor for an amount equal to
100% of the principal amount thereof, and (y) the Company will have
the right, under certain circumstances, to redeem prior to
scheduled maturity additional Series A Bonds without payment of any
prepayment premium. The Company will also pay an agreement
modification fee of $2.25 million to the Institutional Investor.
The Plan also provides that all pre-petition claims of the
Company's secured lenders, trade creditors and employees will be
paid in full.
In addition, the Company has negotiated an amended credit agreement
(the "New Credit Agreement") with its Bank. The New Credit<PAGE>
<PAGE> 23
Agreement will become effective upon the confirmation and
effectiveness of the Plan. The New Credit Agreement will provide
an aggregate availability of $27.5 million, which may be used for
any combination of letters of credit (up to $10.0 million) and
revolving cash borrowings, subject to borrowing base limitations.
The borrowing base for both cash borrowings and letter of credit
amounts will equal 85% of eligible accounts receivable, plus 70% of
the value of all real property mortgaged to the Bank, up to a
maximum of $27.5 million. The New Credit Agreement will be secured
by the Company's trade receivables and mortgages on certain of the
Company's warehouse properties. Borrowings under the New Credit
Agreement will mature on February 28, 1999. The New Credit
Agreement eliminates the 30-day resting period (during which there
may be no outstanding borrowings) for fiscal 1996 and requires only
one such period for fiscal 1997. Two such periods will be required
during fiscal 1998 and fiscal 1999. The New Credit Agreement also
is expected to contain amendments of certain financial covenants
contained in the existing credit agreement in light of the
restructuring.
The Company believes the Plan will mitigate the Company's near-term
financial vulnerability and increase the likelihood that the
Company will realize the benefits of additional capital
expenditures and its anticipated expansion of its refrigerated
transportation management business. After the Plan, the Company's
present level of cash flow from operations and escrowed funds is
expected to be sufficient to cover all interest payments and
planned capital expenditures for fiscal 1996. After the
reorganization, however, the Company will remain highly leveraged
and will continue to be subject to substantial principal and
interest obligations with respect to its indebtedness.
Funds provided from operations (gross operating margin plus
depreciation, amortization and employee stock ownership plan
expense) for fiscal 1993, 1994 and 1995 totaled $68.2 million,
$65.9 million and $71.6 million, respectively. Interest expense,
net of amortization of original issue discount, totaled $50.9
million, $54.2 million and $54.0 million, respectively.
CAPITAL RESOURCES - Expenditures, including capital leases, for
property, plant and equipment for fiscal years 1993, 1994 and 1995
totaled $17.7 million, $11.0 million and $14.3 million,
respectively. Fiscal 1995 capital expenditures included
approximately $6.7 million for the expansion of the Burley, Idaho,
facility and the Tomah, Wisconsin facility. The balance of the
fiscal 1995 capital expenditures included approximately $1.5
million in revenue enhancement or cost reduction expenditures, and
approximately $4.8 million for routine replacements or betterments.
The Company also acquired $1.1 million of assets under capital<PAGE>
<PAGE> 24
leases and $0.2 million under operating leases.
Budgeted fiscal 1996 capital needs total approximately $35.4
million, including approximately $25.6 million for property
development, expansions or acquisition. A portion, related
primarily to material handling equipment, is expected to be leased
on an operating or capital lease basis. The funding for the
approximately $25.6 million of property expansions will principally
come from the funds held in escrow pursuant to the Bond Indenture
or from outside borrowings. As of February 28, 1995, the Company
had approximately $20.7 million in escrowed funds reserved for
capital expenditures. The Company continues to examine
opportunities for expansion of its locations and services. Any
escrowed funds not expended by March 1996 must be used to redeem
First Mortgage Bonds. The Company's capital expenditures are
substantially discretionary.
The Company has made a proposal to the trustee under the indenture
relating to the First Mortgage Bonds to substitute approximately
$4.8 million in cash as collateral for the property damaged in the
Kansas City fire, although no agreement has been reached for such
substitution. The Company has not reclassified any cash balance
for the possible payment.
The Company, as part of its Kansas City, Kansas location, operates
a limestone quarry. Subject to the completion of certain remaining
due diligence items, the Company expects to dispose of this
business during the first half of fiscal 1996. Net proceeds of the
sale must, in accordance with the Company's existing debt
agreements, be reinvested in warehouse properties or used to
satisfy, in part, the mortgage obligation on the property.
Item 8. Financial Statements and Supplementary Data
The Company's consolidated financial statements as of the last day
of February 1994 and 1995 and related information listed below, are
set forth on pages 51 through 77-D of this report.
TITLE PAGE
--------- ----
Independent Auditors' Report 50
Consolidated Balance Sheets as of the last day
of February 1994 and 1995 52
<PAGE>
<PAGE> 25
Consolidated Statements of Operations for years
ended the last day of February 1993, 1994 and
1995 54
Consolidated Statements of Common Stockholders'
Deficit for years ended the last day
of February 1993, 1994 and 1995 55
Consolidated Statements of Cash Flows for years
ended the last day of February 1993, 1994 and
1995 56
Notes to Consolidated Financial Statements as
of the last day of February 1994 and 1995 59
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure
None.
PART III
Item 10. Directors and Executive Officers of the Registrant
The directors and executive officers of Americold as of May 1, 1995
are as follows:
NAME AGE TITLE
---- --- -----
Ronald H. Dykehouse 53 Chairman of the Board, President,
Chief Executive Officer and
Director
Joel M. Smith 51 Senior Vice President, Chief
Financial Officer and Director
John P. LeNeveu 48 Senior Vice President,
Operations and Sales
F. Stanley Sena 46 Senior Vice President,
Administration and Technical
Services
<PAGE>
<PAGE> 26
J. Roy Coxe 54 Senior Vice President,
Logistics
Ronald A. Nickerson 58 Vice President, Operations
Lon V. Leneve 38 Vice President, Treasurer
and Secretary
Frank Edelstein 69 Director
George E. Matelich 38 Director
James C. Pigott 58 Director
William A. Marquard 74 Director
RONALD H. DYKEHOUSE was named President of Americold
Corporation in May 1990 and Chairman of the Board and Chief
Executive Officer in June 1990. From 1989 to 1990, Mr. Dykehouse
was a private investor and consultant. From 1986 to 1989, he was
Executive Vice President and Chairman of the Food and Distribution
Groups of Amfac Inc., a diversified holding company. Mr. Dykehouse
is a past director of the National Frozen Foods Association and
past Chairman of the American Frozen Food Institute.
JOEL M. SMITH has been Senior Vice President and a director of
the Company since December 1986. Mr. Smith has been the Chief
Financial Officer of Americold since 1978 and a Vice President
since 1984.
JOHN P. LENEVEU was named Senior Vice President, Operations
and Sales of Americold in July 1991. From 1988 to 1991, he was a
management consultant with the Institute of Management Resources,
an international management consulting company.
F. STANLEY SENA has been Senior Vice President, Administration
and Technical Services of the Company since August 1991. From 1986
to 1990, Mr. Sena was Vice President, Operations, Western Region,
and from 1990 to 1991, Mr. Sena was Vice President, Operations of
the Company.
J. ROY COXE was named Senior Vice President, Logistics, of
Americold in December 1993. From 1991 to 1993, he was a management
consultant with A. T. Kearney, Inc., an international management
consulting company. Mr. Coxe was a vice president of Drake Sheahan
Stewart Dougall and successors, a logistics and transportation
consulting firm, from 1983 to 1991.
<PAGE>
<PAGE> 27
RONALD A. NICKERSON has been Vice President, Operations since
1990. From 1987 to 1990, Mr. Nickerson was Vice President,
Operations, Eastern Region, of the Company.
LON V. LENEVE was named Vice President in September 1992, has
been Treasurer of Americold since July 1988 and was appointed
Secretary of the Company in February 1995. Mr. Leneve joined
Americold in 1982 and was Controller from 1984 to 1988.
FRANK EDELSTEIN was elected a director of the Company in 1986.
He is currently a consultant to Kelso and Vice President of
Gordon+Morris Group, Inc., an investment banking firm. Mr.
Edelstein joined Kelso in 1987 and held the position of Vice
President at Kelso until 1992. Mr. Edelstein is also a director of
Ceradyne, Inc., IHOP Corporation and Arkansas Best Corporation.
GEORGE E. MATELICH has been a director of the Company since
December 1986. Mr. Matelich joined Kelso in 1985 as an Associate,
served as a Vice President of Kelso from 1986 to 1990 and is
currently a Managing Director of Kelso.
JAMES C. PIGOTT was elected a director of Americold in June
1987. He is President of Pigott Enterprises, Inc., a private
investment company. Mr. Pigott has been Chairman of the Board and
Chief Executive Officer of Management Reports and Services, Inc.,
an accounting consulting firm since 1987. Mr. Pigott's other
business activities include membership on the Board of Directors of
PACCAR, Inc.
WILLIAM A. MARQUARD was elected a director of Americold in
June 1987. He is currently Chairman Emeritus of the Board of
Directors of American Standard, Inc., and Chairman of the Board of
Directors of Arkansas Best Corporation. Mr. Marquard is a director
of Treadco, Inc., Mosler, Inc., Earle M. Jorgenson Company and
Earthshell Container Corporation. He is also Vice Chairman of the
Board of Directors of Kelso.
All directors hold office until the next annual meeting of
shareholders of the Company or until their successors have been
elected and qualified. The executive officers of the Company are
chosen by the Board and serve at its discretion.
For their services on the Board of Directors of the Company,
Messrs. Pigott, Marquard and Edelstein are paid $16,000 per year.
Mr. Pigott receives $1,000 per year as Chairman of the Company's
Audit Committee. Messrs. Pigott, Marquard and Edelstein also
receive $600 per meeting attended. Directors who are also officers
of the Company and Mr. Matelich do not receive additional
compensation as directors of the Company. Directors are reimbursed<PAGE>
<PAGE> 28
for out-of-pocket expenses incurred in connection with attendance
at meetings.
The Compensation Committee for fiscal 1995 consisted of Mr.
Matelich, Mr. Marquard and Mr. Pigott. The Audit Committee for
fiscal 1995 consisted of Mr. Matelich, Mr. Edelstein and Mr.
Pigott.
On December 23, 1992, Kelso and its chief executive officer,
without admitting or denying the findings contained therein,
consented to an administrative order in respect of a Securities and
Exchange Commission (the "Commission") inquiry relating to the 1990
acquisition of a portfolio company by a Kelso affiliate. The order
found that Kelso's tender offer filing in connection with the
acquisition did not comply fully with the Commission's tender offer
reporting requirements, and required Kelso and the chief executive
officer to comply with these requirements in the future.
STOCKHOLDERS' AGREEMENT
- -----------------------
The Company's Bylaws provide for one to twelve directors. The
Board of Directors of the Company currently consists of six
directors. Certain of the Company's shareholders have agreed,
pursuant to the stockholders' agreement dated as of December 24,
1986, as amended (the "Stockholders' Agreement"), that two
directors shall be designated by Kelso. The Stockholders'
Agreement also provides for two directors who are not affiliates of
Kelso, the Management Group or the Co-Investors, as defined in the
Stockholders' Agreement. In addition, one director may be
designated by Northwestern Mutual Life Insurance Company. Mr.
Edelstein and Mr. Matelich have been designated by Kelso. Pursuant
to the Stockholders' Agreement, Mr. Pigott and Mr. Marquard are
deemed not to be affiliates of Kelso, the Management Group or the
Co-Investors. Northwestern Mutual Life Insurance Company has not
designated a director since May 1991. The Stockholders' Agreement
also provides that prior to the occurrence of an initial public
offering of at least 25% of the outstanding shares of common stock
of the Company pursuant to an effective registration statement
under the Securities Act, sales of shares of common stock by a
member of the Management Group are subject to a right of first
refusal granted to the Company and, in certain events, the non-
management shareholders who are parties to the Stockholders'
Agreement.
Item 11. Executive Compensation
SUMMARY COMPENSATION TABLE
- --------------------------<PAGE>
<PAGE> 29
The following table sets forth information as to the compensation
of the Chief Executive Officer and each of the other four most
highly compensated executive officers of the Company as of the last
day of February 1995 for services in all capacities to the Company
for the years ended the last day of February 1993, 1994 and 1995.
<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation Awards
------------------------------------------------------- -------------------
Other Option/
Name and Annual SARs
Principal Position Year Salary Bonus<F1> Compensation<F2> No.
- -------------------- ---- ------ -------- ------------ -----
<S> <C> <C> <C> <C> <C>
Ronald H. Dykehouse 1995 $300,000 $ - $ - $ -
Chairman & CEO 1994 300,000 68,608 - -
1993 300,000 65,276 - -
Joel M. Smith 1995 159,120 - - -
Sr. Vice President 1994 159,120 29,920 - -
and CFO 1993 159,120 27,946 44,009 -
John P. LeNeveu 1995 159,120 - - -
Sr. Vice President, 1994 159,120 29,920 - 30,000
Operations & Sales 1993 159,120 27,946 27,208 -
F. Stanley Sena 1995 150,320 - - -
Sr. Vice President, 1994 140,712 26,459 - -
Administration & 1993 140,712 24,713 43,774 -
Technical Services
J. Roy Coxe<F3> 1995 150,000 55,500 - -
Sr. Vice President, 1994 30,192 23,250 - 30,000
Logistics
_______________
<FN>
<F1> Awards for fiscal 1995 have not been finalized. For
Mr. Coxe, the award in fiscal 1995 represents a bonus paid under an
employment agreement.
<F2> Consists of the cost of relocation, the value of
automobiles, payments made on behalf of the individuals to a bank
which made loans to facilitate acquisition of the Company's stock
by each individual, and other miscellaneous fringe benefits. For
fiscal years 1994 and 1995, the amounts did not exceed the lesser
of $50,000 or 10% of the named executive officer's annual salary
and bonus. For fiscal 1993, the value of such benefits was as
follows: Mr. Smith, bank loan $40,291, other $3,718; Mr. LeNeveu,
relocation $25,999, other $1,209; and Mr. Sena, bank loan $41,910
and other $1,864.
<F3> Mr. Coxe's employment commenced December 20, 1993.
</FN>
/TABLE
<PAGE>
<PAGE> 30
AGGREGATED OPTION TABLE
- -----------------------
The following table sets forth information as to the options held
by the Chief Executive Officer and each of the other four most
highly compensated executive officers of the Company through the
end of fiscal 1995.
<TABLE>
<CAPTION>
Number of
Unexercised
Options at Value of
Fiscal Unexercised
Shares Year-End Options at
Acquired on Value Exercisable/ Fiscal
Name Exercise Realized Unexercisable Year-End
- ---- ------------ -------- ------------- ----------
<S> <C> <C> <C> <C>
Ronald H. Dykehouse 0 $ 0 80,000/20,000 0
Joel M. Smith 0 0 8,278/0 0
John P. LeNeveu 0 0 6,000/24,000 0
F. Stanley Sena 0 0 8,279/0 0
J. Roy Coxe 0 0 6,000/24,000 0
</TABLE>
BENEFIT PLAN AND ARRANGEMENTS
- -----------------------------
MANAGEMENT INCENTIVE PLAN - The Company has a Management Incentive
Plan (the "MIP Plan") to provide additional compensation to
participants, including executive officers, upon the achievement of
certain financial objectives of the Company and individual personal
objectives of the Participants. The MIP Plan was replaced by the
Stock Incentive Plan beginning with fiscal 1992, as described
below, and reinstated by the Board of Directors on June 16, 1994,
effective as of March 1, 1994. The MIP Plan is administered by the
Compensation Committee of the Board of Directors (the "Compensation
Committee") and is applicable to management employees of Americold
and, at the option of the President of the Company, other employees
of Americold. The financial objective award is 50% of the total
award and is based on attainment of actual operating results as
compared to financial targets. The financial objectives were
established and approved by the Company based upon the annual
business plan. The personal objective award is 50% of the total
award and is based on attainment of both quantifiable and
nonquantifiable goals established at the beginning of the MIP Plan
year. Incentive compensation earned under the MIP Plan is computed
as soon as possible after the close of the Company's fiscal year
and payment is generally made within 60 days after the end of the<PAGE>
<PAGE> 31
fiscal year unless a deferred payment election has been filed with
the Company in accordance with the terms of the Plan.
The Board of Directors authorized a separate $500,000 cash bonus
award for both fiscal 1993 and 1994 payable under a format similar
to the MIP Plan structure, which was paid in July 1994. Incentive
compensation earned by the Company's executive officers for the
fiscal year ended the last day of February 1993 and 1994 is
included in the above Summary Compensation Table.
Awards for fiscal 1995 have not been finalized.
STOCK INCENTIVE PLAN - On June 16, 1994, effective as of February
28, 1994, the Board of Directors authorized the suspension of the
Company's Stock Incentive Plan (the "SIP Plan"), which was a
long-term incentive plan intended to provide additional financial
incentives to key employees, including executive officers of the
Company. The award issued for fiscal 1992 under the SIP Plan prior
to its suspension has been paid pursuant to the Plan provisions.
No other awards were issued under the SIP Plan. The SIP Plan,
which was authorized by the Board or Directors on September 19,
1991, was intended to replace the MIP Plan for the four-year period
commencing March 1, 1991 and ending on February 28, 1995. However,
due to the significant effects of the fire at the Company`s Kansas
City, Kansas facility on the results of operations beginning in the
second year of this four-year period, the Board reinstated the
former MIP Plan, as described above, effective March 1, 1994.
Distribution of awards earned under the SIP Plan were deferred
until the end of the four-year period (February 28, 1995), although
annual awards were achievable during each of the three fiscal years
during which the SIP Plan was in effect.
The total amount of shares awarded under the SIP Plan prior to its
suspension on February 28, 1994 was 106,123 shares. All of such
awards were based upon the fiscal 1992 financial performance.
Shares allocable to the individuals named in the Summary
Compensation Table are as follows: Mr. Dykehouse, 16,659;
Mr. Smith, 7,164; Mr. LeNeveu, 4,502; Mr. Sena, 6,335; and
Mr. Coxe, 0.
All awards are intended to be made in common stock of the Company.
Participants may elect, however, for a limited period after the end
of the Plan, to receive cash in lieu of the stock awarded, if they
have not elected to defer receipt of their award. Participants
electing to receive cash will receive the cash bonus that they
would have been awarded during the same award period (fiscal 1992)
under the MIP Plan, plus interest on such amounts. <PAGE>
<PAGE> 32
The total amount of stock awarded under the SIP Plan was determined
by the difference between the actual financial results in each year
and the targeted financial results for such year. Each partici-
pant's share of the total stock awarded under the SIP Plan is based
upon the individual's proportionate interest in the total cash
bonus that would have been awarded to all participants under the
MIP Plan. A maximum of 500,000 shares of common stock was
available for issue under the Plan. The Plan generally requires
that a participant must be employed at the end of the four-year
period (March 1, 1995) in order for the participant's awards to
vest. In April 1995, all awards under the plan were paid. All
participants elected to receive cash in lieu of stock in the
amounts previously disclosed plus interest.
RETIREMENT PLAN - Americold has a noncontributory defined benefit
retirement plan for salaried employees, including executive
officers (the "Retirement Plan"). The Retirement Plan provides
retirement benefits based on credited years of service and average
monthly compensation for the highest five calendar years of the
final 15 calendar years of employment or, if higher, the highest 60
consecutive months in the last 120 months of employment. A
participant's retirement benefits vest after the participant has
completed at least five years of Vesting Service.
The following table shows the approximate annual retirement
benefits payable to employees for life from normal retirement date
pursuant to the Retirement Plan before reduction for Social
Security payments. The actual retirement benefit to employees is
offset by Social Security benefits. Service credited under a
former Beatrice retirement plan will be recognized by the
Retirement Plan for purposes of determining the pension benefits
payable under the Retirement Plan.
Estimated years of credited service to date under the Retirement
Plan for the individuals named in the Summary Compensation Table
are as follows: Mr. Dykehouse, 4 years; Mr. Smith, 16 years; Mr.
LeNeveu, 3 years; Mr. Sena, 25 years; and Mr. Coxe, 1 year.
Estimated years of credited service at normal retirement date (age
65) under the Retirement Plan for the individuals named in the
Summary Compensation Table are as follows: Mr. Dykehouse, 16
years; Mr. Smith, 26 years; Mr. LeNeveu, 20 years; Mr. Sena, 45
years; and Mr. Coxe, 12 years.
<PAGE>
<PAGE> 33
Years of Service
-------------------------------------------
Average Annualized
Compensation 20 30 40 50
- ---------------- -------- -------- -------- --------
$100,000 $ 30,000 $ 45,000 $ 60,000 $ 75,000
125,000 37,500 56,250 75,000 93,744
150,000 45,000 67,500 90,000 112,500
175,000 45,000 67,500 90,000 112,500
200,000 45,000 67,500 90,000 112,500
300,000 45,000 67,500 90,000 112,500
In addition to the above, certain individuals named in the Summary
Compensation Table are entitled to a benefit calculated by using
additional years of service credited under supplements to the
Retirement Plan. Years of credited service under the supplements
for the individuals named in the Summary Compensation Table as of
the last day of February 1995 are as follows: Mr. Dykehouse, 0
years; Mr. Smith, 5 years; Mr. LeNeveu, 0 years; Mr. Sena, 0 years;
and Mr. Coxe, 0 years. The annual amount to be received at normal
retirement date pursuant to the supplements is estimated to be as
follows: Mr. Dykehouse, $0 per annum; Mr. Smith, $5,906 per annum;
Mr. LeNeveu, $0 per annum; Mr. Sena, $0 per annum; and Mr. Coxe, $0
per annum.
A participant's retirement benefits (excluding any incremental
benefit earned under any supplement) under the Retirement Plan plus
50% of Social Security benefits may not exceed 60% of his
compensation at retirement after 40 years of service, subject to
maximum dollar limitations. See Note 8 of Notes to Consolidated
Financial Statements.
EMPLOYEE STOCK OWNERSHIP PLAN - Americold established, effective
March 1, 1987, an Employee Stock Ownership Plan, as amended January
1, 1994 (the "ESOP"), in which all qualifying employees of the
Company not covered by collective bargaining arrangements are able
to participate. It is contemplated that contributions on an annual
basis will not exceed 15% of the aggregate total compensation of
any participating employee. The Company may contribute cash as
well as or in lieu of its stock. The consent of the Company's
Board of Directors is required to authorize any contribution by
Americold to the ESOP. Contributions are allocated among
participants based on the ratio of each participant's compensation
to the total compensation of all such participants, subject to
certain limitations. The ESOP is intended to provide retirement
funds to participants in addition to present pension benefits.
<PAGE>
<PAGE> 34
Benefits under the ESOP vest based upon years of service as
follows: 20% after three years of service, increased by 20% for
each of the next four years with a maximum of 100% after seven
years of service. A participant is 100% vested if employed by the
Company on or after his 65th birthday, or if the participant incurs
a total and permanent disability or dies while employed by the
Company. The ESOP has the right to repurchase previously
distributed shares from employees terminating their ESOP
participation, using funds obtained through cash contributions by
the Company. Participant forfeitures are allocated pro rata to
remaining participants.
Participants are eligible for distribution of their capital
accumulation in the ESOP at the normal retirement age of 65. The
distribution will be made in whole shares of the Company's stock,
cash or a combination of both, as determined by the Compensation
Committee, provided the participant has not elected to be paid in
stock.
Upon termination of the ESOP, the ESOP's trust will be maintained
until the capital accumulations of all participants have been
distributed.
No ESOP contribution was declared for fiscal 1994 and no ESOP
contribution has been declared for fiscal 1995.
KEY EMPLOYEE STOCK OPTION PLAN - In 1987, Americold established a
Key Employee Stock Option Plan (the "Option Plan"). The Option
Plan permits the issuance of nonstatutory options to purchase up to
300,000 shares of common stock of the Company to directors,
officers and other key employees of the Company. Of these, options
to purchase up to 150,000 shares were reserved for issuance to the
Management Group and options to purchase the remaining 150,000
shares are reserved for issuance to all eligible employees
(including the Management Group) of the Company.
An individual exercising options under the Option Plan must become
a party to the Stockholders' Agreement. The Option Plan is
administered by the Compensation Committee. The Compensation
Committee determines the recipients of options granted, the
exercise price and the number of shares of common stock subject to
each option. The Board of Directors may amend the Option Plan from
time to time. The maximum term of each stock option is ten years.
Options become exercisable at such time or times as the
Compensation Committee may determine at the time of grant.
If the outstanding shares of common stock are changed into or
exchanged for a different number or kind of shares of the Company<PAGE>
<PAGE> 35
or other securities of the Company, by reason of any merger,
consolidation, recapitalization, reclassification, stock split-up,
stock dividend or combination of shares, the Compensation Committee
shall make an appropriate and equitable adjustment in the number
and kind of shares as to which the unexercised portion of the
option shall be exercisable, to the extent that after such event
the optionee's right to a proportionate interest in the Company
shall be maintained as if the option had already been exercised and
the option shares were subject to such change or exchange. Such
adjustment shall be made without change in the total price
applicable to the unexercised portion of the option and with a
corresponding adjustment in the exercise price per option share.
Any such adjustment made by the Compensation Committee shall be
final and binding upon the Company, the optionee and all other
interested persons.
In the event of (i) dissolution or liquidation of the Company, (ii)
a merger in which the Company is not the surviving corporation or
(iii) a share exchange pursuant to which the outstanding shares of
common stock of the Company are acquired by another corporation,
then either (a) the Compensation Committee, upon authorization of
the Board, shall make an appropriate and equitable adjustment in
the number and kinds of securities covered by outstanding options,
and such options shall be expressly assumed by the successor
corporation, if any; or (b) in lieu of such adjustment, the Board
shall provide a 30-day period immediately prior to such an event
during which each optionee shall have the right to exercise the
optionee's outstanding options, in whole or in part, without regard
to the time the options have been outstanding or the vesting
schedule provided for in any option agreement entered into pursuant
to the Option Plan and all options not exercised shall expire at
the end of the 30-day period.
Information with regard to the grant of options as of the last day
of February 1995 under the Plan follows:
Number of Option Number Expiration
Options Price Exercisable Date
- ---------- ------- ----------- ----------
93,795 $10.00 93,795 May 1998
100,000 $18.95 80,000 June 2000
30,000 $21.88 6,000 May 2003
30,000 $20.40 6,000 December 2003
No options were exercised during fiscal 1995. See Note 9 of Notes
to Consolidated Financial Statements.
OTHER ARRANGEMENTS - The Company entered into a two-year employment<PAGE>
<PAGE> 36
agreement with Mr. Dykehouse on May 14, 1990. Pursuant to the
terms of the agreement, Mr. Dykehouse agreed to serve as the Chief
Executive Officer of the Company. Further, Mr. Dykehouse agreed
not to compete with the Company for a 12-month period following
termination of his employment unless such termination is "without
cause," as defined in the employment agreement. Although the
agreement has not been extended, certain provisions survive the
expiration of the initial term of the agreement. If before June
26, 1995, Mr. Dykehouse's employment is terminated "without cause,"
the Company has the right to purchase any shares of common stock
acquired pursuant to the exercise of any options granted on June
26, 1990 at the fair market value of the shares, as determined in
accordance with the Stockholders' Agreement. If before June 26,
1995, Mr. Dykehouse's employment is terminated voluntarily or "for
cause," the Company has the right to purchase any such shares at
the price paid by Mr. Dykehouse, plus interest. The agreement also
provided that Mr. Dykehouse would participate in the Americold
Management Incentive Plan, subsequently replaced by the Stock
Incentive Plan. Pursuant to an Agreement of Assumption dated June
26, 1990, Mr. Dykehouse has agreed to be bound by the Stockholders'
Agreement.
The Company entered into a three-year employment agreement with Mr.
Coxe on December 6, 1993. Mr. Coxe agreed to serve as the Senior
Vice President, Logistics, of the Company. Further, Mr. Coxe has
agreed not to compete with the Company for a 12-month period
following termination of his employment unless such termination is
"without cause," as defined in the employment agreement. The
agreement provides, among other conditions, that if during the term
of the employment agreement Mr. Coxe's employment is terminated
"without cause," the Company will pay him a lump sum amount equal
to one year's base compensation, or the balance of the salary, plus
bonus, provided for through the then remaining term of the
agreement, whichever is greater, plus any employee benefits accrued
to the date of termination. The Company is not required to make
any such payment if the termination is "for cause," as defined.
The employment agreement provides that Mr. Coxe will participate in
any incentive plan otherwise offered to members of senior
management. According to the provisions of his employment
agreement, Mr. Coxe was awarded a minimum bonus of $55,500 with
respect to fiscal 1995 on March 1, 1995.
Item 12. Security Ownership of Certain Beneficial Owners and
Management
The following table sets forth information regarding the
beneficial ownership of common stock as of May 1, 1995 by (i) each
person known by the Company to own more than five percent of its
common stock, (ii) each director of the Company, (iii) each named<PAGE>
<PAGE> 37
executive officer, (iv) all directors and officers as a group and
(v) the Management Group:
<TABLE>
<CAPTION>
<S> <C> <C>
Percent of
Number of Outstanding
Name and Address Shares Shares
- ---------------- --------- -----------
KIA III-Americold, Inc., L.P.<F1> 2,000,000 41.1%
("KIA III")
c/o Kelso & Company
350 Park Avenue, 21st Floor
New York, NY 10017
Kelso Investment Associates II, L.P.<F1> 500,000 10.3%
("KIA II")
c/o Kelso & Company
350 Park Avenue, 21st Floor
New York, NY 10017
Kelso Equity Partners, L.P.<F1> 70,000 1.4%
("Kelso Equity")
c/o Kelso & Company
350 Park Avenue, 21st Floor
New York, NY 10017
Joseph S. Schuchert<F2> 2,593,600 53.3%
350 Park Avenue, 21st Floor
New York, NY 10017
Frank T. Nickell<F2> 2,593,600 53.3%
350 Park Avenue, 21st Floor
New York, NY 10017
George E. Matelich<F2> 2,593,600 53.3%
350 Park Avenue, 21st Floor
New York, NY 10017
Thomas R. Wall, IV<F2> 2,593,600 53.3%
350 Park Avenue, 21st Floor
New York, NY 10017
The Northwestern Mutual Life
Insurance Company<F1> 500,000 10.3%
720 East Wisconsin Avenue
Milwaukee, WI 53202
New York Life Insurance Company<F1> 330,000 6.8%
51 Madison Avenue
New York, NY 10010
New York Life Insurance and
Annuity Corporation<F1> 250,000 5.1%
51 Madison Avenue
New York, NY 10010
Ronald H. Dykehouse<F1><F3> 117,900 2.4%
7007 S. W. Cardinal Lane, Suite 135
Portland, OR 97224
<PAGE>
<PAGE> 38
Joel M. Smith<F1><F3> 38,278 0.8%
7007 S. W. Cardinal Lane, Suite 135
Portland, OR 97224
John P. LeNeveu <F3> 14,000 0.3%
7007 S. W. Cardinal Lane, Suite 135
Portland, OR 97224
F. Stanley Sena <F1><F3> 38,279 0.8%
7007 S. W. Cardinal Lane, Suite 135
Portland, Or 97224
J. Roy Coxe <F3> 6,000 0.1%
7007 S. W. Cardinal Lane, Suite 135
Portland, OR 97224
Frank Edelstein -- --
The Gordon+Morris Group, Suite 1400
620 Newport Center Drive
Newport Beach, CA 92660
James C. Pigott -- --
1405 - 42nd Avenue East
Seattle, WA 98112
William A. Marquard -- --
Eaglestone Farm
2199 Maysville Road
Carlisle, KY 40311
All directors and officers as
a group (11 persons)<F2><F3> 284,095 5.8%
Management Group (30) persons<F1><F3> 557,556 11.5%
</TABLE>
___________________
<F1> These persons are party to the Stockholders' Agreement which
controls the voting by these shareholders for directors of the
Company. See Part II, Item 10, "Directors and Executive Officers
of the Registrant".
<F2> Messrs. Schuchert, Nickell, Matelich and Wall may be deemed
to share beneficial ownership of shares owned of record by KIA III,
KIA II, Kelso Equity and Kelso & Company (Kelso & Company owns
23,600 shares) by virtue of their status as the general partners of
Kelso Partners III, L.P. (the general partner of KIA III), Kelso
Partners II, L.P. (the general partner of KIA II), and Kelso Equity
and the controlling stockholders and officers of Kelso & Company.
Messrs. Schuchert, Nickell, Matelich and Wall share investment and
voting powers with respect to securities owned by the foregoing
entities. Messrs. Schuchert, Nickell, Matelich and Wall disclaim
beneficial ownership of such securities (other than the 23,600
shares owned by Kelso & Company).
<F3>Includes the following numbers of shares of common stock that
may be acquired within 60 days after May 1, 1995 through the
exercise of stock options granted pursuant to the Company's Option
Plan: <PAGE>
<PAGE> 39
100,000 shares for Mr. Dykehouse; 8,278 shares for Mr. Smith;
12,000 shares for Mr. LeNeveu; 8,279 shares for Mr. Sena; 6,000
shares for Mr. Coxe; 145,595 for all directors and officers as a
group; and 207,656 shares for the Management Group.
The shareholders of the Company listed above hold approximately 83%
of the voting power of the Company's common stock and are able to
elect all of the members of the Board of Directors and thereby
control the Company.
Item 13. Certain Relationships and Related Transactions
There are no reportable transactions or relationships.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on
Form 8-K
(a) The following documents are filed as part of this report.
1. FINANCIAL STATEMENTS PAGE
-------------------- ----
Reference is made to Part II, Item 8
for the listing of the required financial
statements filed with this report 24
2. FINANCIAL STATEMENT SCHEDULES
-----------------------------
Schedule II - Valuation and Qualifying
Accounts for years ended the last day of
February 1993, 1994 and 1995 77-A
All other schedules are omitted because they are not
applicable, or are not required, or because the
required information is included in the Company's
consolidated financial statements as of the last
day of February 1994 and 1995 or notes thereto.
<PAGE>
<PAGE> 40
3. EXHIBITS
--------
(2) Plan of Reorganizaton, dated April 14, 1995
(3) Articles of Incorporation and Bylaws
(i) Second Restated Articles of Incorporation,
as amended (filed as Exhibit (3)(i) to the
Form 10-Q, dated October 11, 1989, for the
quarter ended August 31, 1989, and
incorporated herein by reference)
(ii) Restated Bylaws, as amended, through March
26, 1991
(4) Instruments defining the rights of security holders,
including indentures
(i) Articles IV, V and VI of the Second Restated
Articles of Incorporation as amended (see
Exhibit (3)(i))
(ii) Articles I, II, V, VII and X of the Restated
Bylaws as amended (see Exhibit (3)(ii))
(iii) Second Restated Stockholders' Agreement
dated as of December 24, 1986, as amended as
of June 22, 1987 (filed as Exhibit (4)(iv)
to the Form 10-K, dated May 27, 1988, for
the fiscal year ended February 29, 1988 and
incorporated herein by reference)
(iv) Third Amendment dated May 22, 1990 to
Stockholders' Agreement dated as of December
24, 1986, as amended as of June 22, 1987
(filed as Exhibit (4) to the Form 10-Q dated
July 12, 1990, for the quarter ended May 31,
1990 and incorporated herein by reference)
(v) Form of Amended and Restated Indenture
relating to the First Mortgage Bonds (filed
as Exhibit (4)(vi) to the Registration
Statement on Form S-1 (Registration No. 33-
53584) filed with the Commission on March 2,
1993 and is incorporated herein by
reference)
<PAGE>
<PAGE> 41
(vi) Stock Pledge Agreement dated as of February
28, 1989, between Registrant and The
Connecticut National Bank (filed as Exhibit
(19)(iii) to the Form 10-Q, dated October
14, 1992, for the quarter ended August 31,
1992 and incorporated herein by reference)
(vii) Stock Pledge Agreement dated as of February
28, 1989 between Registrant and United
States National Bank of Oregon, acting as
agent pursuant to Article IX of the Credit
Agreement, as amended, dated as of April 30,
1987 (filed as Exhibit (19)(iv) to the Form
10-Q, dated October 14, 1992, for the
quarter ended August 31, 1992 and
incorporated herein by reference)
(viii) Indenture dated as of May 1, 1987 between
Registrant and United States Trust Company
of New York, as Trustee (included as an
exhibit to the Registration Statement on
Form S-1 (Registration No. 33-12173) filed
with the Commission on April 29, 1987 and
incorporated herein by reference)
(ix) Form of Amended and Restated Investment
Agreement relating to the First Mortgage
Bonds filed as Exhibit (4)(v) to the
Registration Statement on Form S-1
(Registration No. 33-53584) (filed with the
Commission on March 2, 1993 and incorporated
herein by reference)
(x) Form of Amended and Restated Security
Agreement relating to the First Mortgage
Bonds (filed as Exhibit (4)(xiv) to the
Registration Statement on Form S-1
(Registration No. 33-53584) filed with the
Commission on March 2, 1993 and incorporated
herein by reference)
(xi) Form of Senior Subordinated Debenture
(included as part of Exhibit (4)(viii))
<PAGE>
<PAGE> 42
(xii) Form of Mortgage, Assignment of Rents and
Security Agreement dated as of June 15, 1987
(included as an exhibit to the Registration
Statement on Form S-1 (Registration No. 33-
12173) filed with the Commission on April
29, 1987 and incorporated herein by
reference)
(xiii) Form of Series A Bond (included as part of
Exhibit (4)(v))
(xiv) Form of Series B Bond (included as part of
Exhibit (4)(v))
(xv) Form of Amended and Restated Cash Collateral
Pledge Agreement relating to the First
Mortgage Bonds (filed as Exhibit (4)(xix) to
the Registration Statement on Form S-1
(Registration No. 33-53584) filed with the
Commission on March 2, 1993 and incorporated
herein by reference)
(xvi) Form of Amended Stock Pledge Agreement
relating to the First Mortgage Bonds (filed
as Exhibit (4)(xx) to the Registration
Statement on Form S-1 (Registration No. 33-
53584) filed with the Commission on March 2,
1993 and incorporated herein by reference)
(xvii) Form of Amended Mortgage, Assignment of
Rents and Security Agreement relating to the
First Mortgage Bonds (filed as Exhibit
(4)(xxi) to the Registration Statement on
Form S-1 (Registration No. 33-53584) filed
with the Commission on March 2, 1993 and
incorporated herein by reference)
(10) Material Contracts
(i) Americold Corporation Key Employee Stock
Option Plan, as amended, effective July 12,
1988 (filed as Exhibit (4)(i) to the Form
10-Q dated October 14, 1988, for the quarter
ended August 31, 1988 and incorporated
herein by reference)
<PAGE>
<PAGE> 43
(ii) Form of Nonstatutory Stock Option Agreement,
as amended, entered into between Registrant
and certain employees pursuant to the
Americold Corporation Key Employee Stock
Option Plan (filed as Exhibit (4)(ii) to the
Form 10-Q dated October 14, 1988, for the
quarter ended August 31, 1988 and
incorporated herein by reference)
(iii) Form of Amended and Restated Investment
Agreement relating to the First Mortgage
Bonds (see Exhibit (4)(ix))
(iv) Form of Amended and Restated Security
Agreement relating to the First Mortgage
Bonds (see Exhibit (4)(x))
(v) Stock Pledge Agreement dated as of February
28, 1989, between Registrant and The
Connecticut National Bank (see Exhibit
(4)(vi))
(vi) Stock Pledge Agreement dated as of February
28, 1989, between Registrant and United
States National Bank of Oregon, a national
banking association, acting as agent
pursuant to Article IX of the Credit
Agreement, as amended, dated as of April 30,
1987 (see Exhibit (4)(vii))
(vii) Americold Corporation Management Incentive
Plan (filed as Exhibit (10)(iii) to the Form
10-K, dated May 27, 1988, for the fiscal
year ended February 29, 1988 and
incorporated herein by reference)
(viii) Form of Indemnity Agreement entered into
between the Company and each of its officers
and directors (filed as Exhibit (4)(x) to
Form 10-K dated May 29, 1992 for the fiscal
year ended February 29, 1992 and
incorporated herein by reference)
(ix) Second Restated Stockholders' Agreement,
dated as of December 24, 1986, as amended as
of June 22, 1987 (see Exhibit (4)(iii)
<PAGE>
<PAGE> 44
(x) Third Amendment dated May 22, 1990 to
Stockholders' Agreement dated as of December
24, 1986, as amended as of June 22, 1987
(see Exhibit (4)(iv))
(xi) Indenture dated as of May 1, 1987 between
the Company and United States Trust Company
of New York, as Trustee (see Exhibit
(4)(viii))
(xii) Credit Agreement between the Company and
United States National Bank of Oregon dated
February 3, 1993 (filed as Exhibit
(10)(xxii) to the Registration Statement on
Form S-1 (Registration No. 33-53584) filed
with the Commission on March 2, 1993 and
incorporated herein by reference)
(xiii) Form of Amended and Restated Indenture
relating to the First Mortgage Bonds (see
Exhibit (4)(v))
(xiv) Form of Amended and Restated Cash Collateral
Pledge Agreement relating to the First
Mortgage Bonds (see Exhibit (4)(xv))
(xv) Form of Amendment to Stock Pledge Agreement
relating to the First Mortgage Bonds (see
Exhibit (4)(xvi))
(xvi) Indemnification Agreement dated October 31,
1991 between the Company and The First
Boston Corporation (included as Exhibit
(10)(xx) to the Registration Statement on
Form S-2 (Registration No. 33-41963) filed
with the Commission on July 31, 1991 and
incorporated herein by reference)
(xvii) Americold Stock Incentive Plan effective
March 1, 1991 (filed as Exhibit(10)(xviii)
to the Form 10-K dated May 29, 1992 for the
fiscal year ended February 29, 1992 and
incorporated herein by reference)
<PAGE>
<PAGE> 45
(xviii) Employment Agreement dated May 14, 1990,
between the Company and Ronald H. Dykehouse
(filed as Exhibit (10)(i) to the Form 10-Q
dated October 12, 1990 for the quarter ended
August 31, 1990 and incorporated herein by
reference)
(xix) Employment Agreement dated May 14, 1992,
between the Company and John P. LeNeveu
(filed as Exhibit (19) to the Form 10-Q
dated July 15, 1992 for the quarter ended
May 31, 1992 and incorporated herein by
reference)
(xx) Master Lease Agreement dated February 28,
1989, between Registrant and Americold
Services Corporation (filed as Exhibit
(19)(vi) to the Form 10-Q, dated October 14,
1992, for the quarter ended August 31, 1992
and incorporated herein by reference)
(xxi) Americold Transportation Systems Purchase of
Joint Venture Interest, effective November
1, 1991, between Registrant and Superior
Transportation Systems, Inc. (filed as
Exhibit (19)(vii) to the Form 100-Q, dated
October 14, 1992, for the quarter ended
August 31, 1992 and incorporated herein by
reference)
(xxii) Lease dated May 15, 1992, between Registrant
and Oregon Warehouse Partners, a Texas
general partnership (lease agreement for
Ontario, Oregon facility) (filed as Exhibit
(19)(viii) to the Form 10-Q, dated October
14, 1992, for the quarter ended August 31,
1992 and incorporated herein by reference)
(xxiii) Form of First Amendment to Master Lease
Agreement between Registrant and Americold
Services Corporation (filed as Exhibit
(10)(xxxi) to the Registration Statement on
Form S-1 (Registration No. 33-53584) filed
with the Commission on March 2, 1993 and
incorporated hereby by reference)
<PAGE>
<PAGE> 46
(xxiv) Nonstatutory Stock Option Agreement dated
May 19, 1993 between the Company and John P.
LeNevue (filed as Exhibit (10)(i) to the
Form 10-Q, dated January 13, 1994 for the
quarter ended November 30, 1993, and
incorporated herein by reference)
(xxv) First Amendment, dated October 1, 1993, to
the Credit Agreement between the Company and
United States National Bank of Oregon dated
February 3, 1993 (filed as Exhibit (10)(ii)
to the Form 10-Q dated January 13, 1994 for
the quarter ended November 30, 1993, and
incorporated herein by reference)
(xxvi) Employment Agreement dated December 6, 1993,
between the Company and J. Roy Coxe (filed
as Exhibit (10)(iii) to the Form 10-Q dated
January 13, 1994 for the quarter ended
November 30, 1993, and incorporated herein
by reference)
(xxvii) Nonstatutory Stock Option Agreement dated
December 17, 1993 between the Company and J.
Roy Coxe.
(11) Statement regarding computation of per share
earnings
(21) Subsidiaries of the Registrant
(23) Consent of KPMG Peat Marwick LLP
(b) Reports on Form 8-K
Subsequent to the end of the fiscal year, the following were
filed:
1. A Current Report on Form 8-K, dated April 14, 1995, was
filed disclosing the distribution of a confidential
disclosure statement to certain of its debtholders
describing the Company's plan for restructuring certain
of its outstanding indebtedness. The disclosure
statement solicited acceptance of a proposed prepackaged
plan of reorganization under Chapter 11 of the U. S.
Bankruptcy Code as a means of implementing the
restructuring.
<PAGE>
<PAGE> 47
2. A Current Report on Form 8-K, dated May 9, 1995, was
filed announcing that the Company's restructuring plan
had received approval from both classes of debtholders
entitled to vote on the plan and that the Company had
filed the plan as approved as a prepackaged plan of
reorganization under Chapter 11 of the U. S. Bankruptcy
Code in the United States Bankruptcy Court for the
District of Oregon on May 9, 1995.
<PAGE>
<PAGE> 48
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Company has duly caused this
report to be signed on its behalf by the undersigned, thereunto
duly authorized.
AMERICOLD CORPORATION
May 26, 1995
By: /s/ Ronald H. Dykehouse By: /s/ Joel M. Smith
------------------------ ------------------------
Ronald H. Dykehouse Joel M. Smith
Chairman of the Board, Senior Vice President and
President and Chief Financial Officer
Chief Executive Officer (Principal Financial Officer)
By: /s/ Thomas R. Ferreira
------------------------
Thomas R. Ferreira
Corporate Controller
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed by the following persons on
behalf of the Company and in the capacities and on the dates
indicated.
/s/ Ronald H. Dykehouse
- ------------------------------- May 24, 1994
Ronald H. Dykehouse, Director
/s/ Joel M. Smith
- ------------------------------- May 24, 1994
Joel M. Smith, Director
/s/ Frank Edelstein
- ------------------------------- May 24, 1994
Frank Edelstein, Director
/s/ George E. Matelich
- ------------------------------- May 24, 1994
George E. Matelich, Director
/s/ James C. Pigott
- ------------------------------- May 24, 1994
James C. Pigott, Director
- ------------------------------- May 24, 1994
William A. Marquard, Director
<PAGE>
<PAGE> 49
Supplemental Information to be Furnished With Reports Filed
Pursuant to Section 15(d) of the Act by Registrants Which Have Not
Registered Securities Pursuant to Section 12 of the Act.
No annual report covering the Company's last fiscal year or proxy
statement with respect to any annual or other meeting of security
holders has been sent to security holders. The Company does not
solicit proxies.
<PAGE>
<PAGE> 50
KPMG Peat Marwick LLP Telephone 503 221 6500
Suite 2000 Telefax 503 796 7650
1211 South West Fifth Avenue
Portland, OR 97204
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Stockholders
Americold Corporation:
We have audited the consolidated financial statements of Americold
Corporation as listed in the accompanying index (see item 8). In
connection with our audits of the consolidated financial
statements, we also have audited the financial statement schedule
as listed in the accompanying index (see item 14). These
consolidated financial statements and the financial statement
schedule are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated
financial statements and the financial statement schedule 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 consolidated financial statements referred to
above present fairly, in all material respects, the financial
position of Americold Corporation as of the last day of
February 1994 and 1995, and the results of their operations and
their cash flows for each of the years in the three-year period
ended the last day of February 1995 in conformity with generally
accepted accounting principles. Also in our opinion, the related
financial statement schedule, when considered in relation to the
basic consolidated financial statements taken as a whole, present
fairly, in all material respects, the information set forth
therein.
As discussed in Note 1 to the consolidated financial statements,
Americold Corporation adopted the provisions of the Financial
Accounting Standards Board's Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes" and No. 106,
"Employers' Accounting for Postretirement Benefits Other Than
Pensions" during the year ended the last day of February 1994.
Member Firm of Klynveld Peat Marwick Goerdeler<PAGE>
<PAGE> 51
KPMG Peat Marwick LLP
The Board of Directors and Stockholders
Americold Corporation
Page 2
The accompanying consolidated financial statements have been
prepared assuming that the Company will continue as a going
concern. However, the Company's available cash and cash flow from
operating activities will not be sufficient to allow the Company to
meet its current debt service obligations and remain in compliance
with its debt agreement covenants, which raise substantial doubt
about its ability to continue as a going concern. As discussed in
Note 16, the Company did not make a scheduled debt payment on
May 1, 1995 and filed a pre-packaged petition under Chapter 11 of
the United States Bankruptcy Code on May 9, 1995. The consolidated
financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
/s/ KPMG Peat Marwick LLP
Portland, Oregon
May 12, 1995
<PAGE>
<PAGE> 52
<TABLE>
AMERICOLD CORPORATION
Consolidated Balance Sheets
Last day of February 1994 and 1995
(In Thousands, Except Share Data)
<CAPTION>
ASSETS 1994 1995
------ ---- ----
<S> <C> <C>
Current assets:
Cash and cash equivalents (notes 15 and 16) $ 3,892 $ 33,163
Trade receivables, less allowance for doubtful accounts
of $298 and $313, respectively (note 7) 16,702 20,510
Other receivables, less allowance for doubtful accounts
of $4,100 and $-0-, respectively (note 14) 8,351 2,105
Prepaid expenses 3,972 5,240
Tax refund receivable 1,291 279
Other current assets 628 695
------- --------
Total current assets 34,836 61,992
Net property, plant and equipment (notes 2, 4 and 7) 375,772 367,248
Cost in excess of net assets acquired, less accumulated
amortization of $17,230 and $19,765, respectively 82,563 80,028
Debt issuance costs, less accumulated amortization of
$5,540 and $6,803, respectively (notes 7 and 12) 9,371 8,953
Other noncurrent assets (note 3) 26,161 26,374
------- --------
Total assets $ 528,703 $ 544,595
======== ========
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<PAGE> 53
<TABLE>
<CAPTION>
LIABILITIES, PREFERRED STOCK AND
COMMON STOCKHOLDERS' DEFICIT 1994 1995
-------------------------------- ---- ----
<S> <C> <C>
Current liabilities:
Accounts payable $ 5,450 $ 6,741
Accrued interest 17,334 17,683
Accrued expenses (note 5) 7,512 11,345
Deferred revenue 4,772 5,914
Current maturities of long-term debt (notes 7 and 16) 2,281 31,315
Other current liabilities (notes 4 and 6) 4,944 3,912
------ -------
Total current liabilities 42,293 76,910
Long-term debt, less current maturities (notes 7 and 16) 467,337 442,912
Deferred income taxes (note 11) 104,558 106,098
Other noncurrent liabilities (notes 4 and 8) 11,744 10,633
------ -------
Total liabilities 625,932 636,553
------- -------
Preferred stock, Series A, $100 par value. Authorized
1,000,000 shares; issued and outstanding 49,672
and 52,936 shares, respectively (note 10) 5,348 5,789
------ -------
Common stockholders' deficit (notes 7, 8 and 9):
Common stock, $.01 par value. Authorized
10,000,000 shares; issued and
outstanding 4,863,999 and 4,860,934
shares, respectively 49 49
Additional paid-in capital 49,082 49,022
Retained deficit (151,653) (146,775)
Adjustment for minimum pension liability (55) (43)
------ -------
Total common stockholders' deficit (102,577) (97,747)
Commitments and contingencies (notes 4, 7, 8 and 16) ------- --------
Total liabilities, preferred stock and
common stockholders' deficit $528,703 $544,595
======= =======
</TABLE>
<PAGE>
<PAGE> 54
<TABLE><CAPTION>
AMERICOLD CORPORATION
Consolidated Statements of Operations
Years ended last day of February 1993, 1994 and 1995
(In Thousands, Except Per Share Data)
1993 1994 1995
---- ---- ----
<S> <C> <C> <C>
Net sales $196,130 $198,887 $215,207
------- ------- -------
Operating expenses:
Cost of sales 118,846 126,273 138,132
Amortization of cost in excess
of net assets acquired 2,533 2,531 2,535
Selling and administrative expenses 27,192 27,090 25,955
Employee stock ownership plan
expense (notes 8 and 10) 750 - 750
------- ------- -------
Total operating expenses 149,321 155,894 167,372
------- ------- -------
Gross operating margin 46,809 42,993 47,835
------- ------- -------
Other income (expense):
Interest income 323 757 1,870
Interest expense (51,943) (55,403) (55,344)
Amortization of debt issuance costs (1,173) (1,249) (1,276)
Gain on insurance settlement (note 14) - - 16,953
Other, net 289 680 753
------- ------- -------
Total other expense (52,504) (55,215) (37,044)
------- ------- -------
Income (loss) before income taxes,
extraordinary item and cumulative
effect of accounting principle changes (5,695) (12,222) 10,791
Provision (benefit) for income taxes (note 11) 2,455 (1,183) 5,227
------- ------- -------
Income (loss) before extraordinary
item and cumulative effect of
accounting principle changes (8,150) (11,039) 5,564
Extraordinary item, net of income tax benefit
of $1,192 (note 12) - (1,848) -
Cumulative effect on prior years of accounting
principle changes for:
Income taxes (note 11) - (61,833) -
Postretirement benefits other
than pensions, net of income tax
benefit of $1,490 (note 8) - (2,401) -
------- ------- -------
Net income (loss) $ (8,150) $(77,121) $ 5,564
======= ======= =======
Income (loss) per share:
Income (loss) before extraordinary item and
cumulative effect of accounting
principle changes $ (1.80) $ (2.39) $ 1.00
Extraordinary item - (.38) -
Cumulative effect of accounting principle changes:
Income taxes - (12.74) -
Postretirement benefits other than pensions - (.49) -
------- ------- -------
Net income (loss) per common share $ (1.80) $ (16.00) $ 1.00
======= ======= =======
Weighted average number of shares outstanding 4,839 4,855 4,864
======= ======= =======
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<PAGE> 55
<TABLE>
<CAPTION>
AMERICOLD CORPORATION
Consolidated Statements of Common Stockholders' Deficit
Years ended last day of February 1993, 1994 and 1995
(In Thousands, Except Share Data)
Adjustment
for
Additional minimum Total common
Common paid-in Retained pension stockholders'
stock capital deficit liability deficit
------ ---------- -------- ---------- -------------
<S> <C> <C> <C> <C> <C>
Balance last day of February 1992 $48 $48,332 $ (65,237) $(25) $ (16,882)
Purchase of common stock (1,910 shares) - (19) - - (19)
Issuance of common stock (17,476 shares) 1 449 - - 450
14.25% preferred stock dividend - - (183) - (183)
Undeclared cumulative preferred stock dividend - - (387) - (387)
Adjustment for minimum pension liability - - - (4) (4)
Net loss - - (8,150) - (8,150)
-- ------ ------- --- -------
Balance last day of February 1993 49 48,762 (73,957) (29) (25,175)
Issuance of common stock (13,333 shares) - 320 - - 320
13.25% preferred stock dividend - - (194) - (194)
Undeclared cumulative preferred stock dividend - - (381) - (381)
Adjustment for minimum pension liability - - - (26) (26)
Net loss - - (77,121) - (77,121)
-- ------ ------- --- -------
Balance last day of February 1994 49 49,082 (151,653) (55) (102,577)
Purchase of common stock (3,065 shares) - (60) - - (60)
11.5% preferred stock dividend - - (190) - (190)
Undeclared cumulative preferred stock dividend - - (496) - (496)
Adjustment for minimum pension liability - - - 12 12
Net income - - 5,564 - 5,564
-- ------ ------- --- -------
Balance last day of February 1995 $49 $49,022 $(146,775) $(43) $(97,747)
== ====== ======== === =======
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<PAGE> 56
<TABLE>
<CAPTION>
AMERICOLD CORPORATION
Consolidated Statements of Cash Flows
Years ended last day of February 1993, 1994 and 1995
(In Thousands)
1993 1994 1995
---- ---- ----
<S> <C> <C> <C>
Cash flows from operating activities:
Net income (loss) $ (8,150) $ (77,121) $ 5,564
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depreciation 17,725 19,938 20,140
Amortization of cost in excess
of net assets acquired 2,533 2,531 2,535
Amortization of debt issuance costs 1,173 1,249 1,276
Amortization of original issue discount 1,068 1,205 1,369
(Gain) loss on sale of assets (63) 8 (286)
Gain on insurance settlement - - (16,953)
Gain on termination of capital lease - (514) -
Other amortization 373 408 302
Employee stock ownership plan expense 450 320 -
Cumulative effect of accounting
principle changes - 64,234 -
Write-off of unamortized issuance costs - 3,040 -
Change in assets and liabilities:
Receivables 1,963 (336) (6,952)
Prepaid expenses (1,569) (1,067) (1,268)
Tax refund receivable (1,384) 93 1,012
Other current assets (42) 165 (67)
Accounts payable 24 (890) 1,291
Accrued interest (161) 7,166 349
Accrued expenses (311) (458) 3,833
Deferred revenue (479) (443) 1,142
Other current liabilities 989 906 (1,032)
Deferred income taxes 1,533 (1,375) 1,540
Other noncurrent liabilities 2,028 (583) (1,111)
------- ------ -------
Net cash provided by
operating activities 17,700 18,476 12,684
------- ------ -------
(Continued)
</TABLE>
<PAGE>
<PAGE> 57
<TABLE>
<CAPTION>
AMERICOLD CORPORATION
Consolidated Statements of Cash Flows, Continued
(In Thousands)
1993 1994 1995
---- ---- ----
<S> <C> <C> <C>
Cash flows from investing activities:
Proceeds from sale of assets $ 16 $ 26 $ 1,105
Expenditures for property, plant and equipment (7,661) (8,925) (13,203)
Purchase of long-term investment - (1,000) (447)
Proceeds from insurance policies - - 26,343
Expenditures for logistics software - - (1,650)
Other items, net (1,098) (994) 287
------- ------ -------
Net cash provided (used) by
investing activities (8,743) (10,893) 12,435
------- ------ -------
Cash flows from financing activities:
Net repayments under credit agreement (15,417) (8,583) -
Principal payments under capital lease
and other debt obligations (2,457) (2,496) (2,087)
Proceeds from mortgage - - 13,475
Payoff of note - - (9,044)
Net proceeds, excluding escrow
amounts, from financing lien 3,950 - -
Net proceeds, excluding escrow
amounts, from sale of mortgage bonds - 150,000 -
Retirement of mortgage bonds - (150,000) -
Release of escrow funds 7,000 5,809 2,714
Debt issuance costs (905) (870) (846)
Purchase of treasury stock (19) - (60)
------- ------ -------
Net cash provided (used) by
financing activities (7,848) (6,140) 4,152
------- ------ -------
Net increase in cash and cash
equivalents 1,109 1,443 29,271
Cash and cash equivalents at beginning of year 1,340 2,449 3,892
------- ------ -------
Cash and cash equivalents at end of year $ 2,449 $ 3,892 $ 33,163
======= ====== =======
Supplemental disclosure of cash flow information:
Cash paid during the year for interest,
net of amounts capitalized $ 51,036 $47,031 $ 53,626
Cash paid during the year for income taxes 2,415 491 2,675
(Continued)
</TABLE>
<PAGE>
<PAGE> 58
<TABLE>
<CAPTION>
AMERICOLD CORPORATION
Consolidated Statements of Cash Flows, Continued
(In Thousands)
1993 1994 1995
---- ---- ----
<S> <C> <C> <C>
Supplemental schedule of noncash investing and
financing activities:
Capital lease obligations incurred
to lease new equipment $ 1,217 $ 954 $ 1,120
Warehouse facility purchased by
long-term debt 10,000 - -
Net book value of assets included
in other receivables 1,008 3,623 -
Financing lease proceeds placed in escrow 12,050 - -
Bond proceeds placed in escrow,
net of debt issuance costs of $3,966 - 22,284 -
Sale proceeds placed in escrow - - 1,483
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<PAGE> 59
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
Last day of February 1994 and 1995
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting policies and methods of their application that
significantly affect the determination of financial position,
cash flows and results of operations are as follows:
(a) BUSINESS DESCRIPTION
Americold Corporation (the Company) operates a nationwide network
of 51 owned or leased refrigerated warehouse facilities in 15
states. The Company has a wholly-owned warehousing subsidiary,
Americold Services Corporation.
In addition, the Company operates certain businesses in selected
locations which are unrelated to the basic public refrigerated
warehousing business; these include a limestone quarry and a
transportation broker service. These businesses are not
significant to the Company as a whole and are not required to be
reported as separate industry segments.
(b) PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of
Americold Corporation and its wholly-owned subsidiary. All
significant intercompany transactions, profits, and balances have
been eliminated.
(c) PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are stated at cost. Depreciation
is generally provided on the straight-line method over the
estimated useful lives of the respective assets ranging from 3 to
45 years for financial reporting purposes and on accelerated
methods for income tax purposes where possible. Property held
under capital leases (at capitalized value) is amortized on the
straight-line method over its estimated useful life, limited
generally by the lease period. The amortization of the property
held under capital leases is included with depreciation expense.
Estimated remaining useful lives are reviewed periodically for
reasonableness and any necessary change is generally effected at
the beginning of the accounting period in which the revision is
adopted.
Maintenance and repairs are expensed in the year incurred; major
renewals and betterments of equipment and refrigerated facilities
are capitalized and depreciated over the remaining life of the
asset. (Continued)<PAGE>
<PAGE> 60
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
(d) COST IN EXCESS OF NET ASSETS ACQUIRED
On December 24, 1986, all the outstanding capital stock of the
Company was acquired by a private group consisting of affiliates
of Kelso & Company, Inc., certain institutional investors and
certain key employees and members of the Company's management.
The acquisition of the Company (the Acquisition) was accounted
for as a purchase. An allocation of the purchase price was made
to the acquired assets and liabilities based on their estimated
fair market values at the date of acquisition. The unallocated
purchase price is the Company's estimate of goodwill associated
with the acquisition and is being amortized using the
straight-line method over a period of 40 years.
On March 1, 1990, the Company acquired the warehousing business
of an unrelated third party. The goodwill associated with the
acquisition is being amortized using the straight-line method
over a period of 15 years.
The Company assesses the recoverability of the goodwill by
determining whether the amortization of the goodwill balance over
its remaining useful life can be recovered through projected
undiscounted future net income. The amount of goodwill
impairment, if any, is measured based on projected discounted
future net income using a discount rate reflecting the Company's
current average cost of funds.
(e) DEBT ISSUANCE COSTS
Debt issuance costs incurred are amortized over the term of the
related debt.
(f) INCOME TAXES
In February 1992, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes" (Statement 109). Statement 109 requires a
change from the deferred method of accounting for income taxes of
APB Opinion 11 to the asset and liability method of accounting
for income taxes. Under the asset and liability method of
Statement 109, deferred tax assets and liabilities are recognized
for the future tax consequences attributable to differences
between the financial statement carrying amounts of existing
assets and liabilities and their respective tax bases. Deferred
tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled.
Under Statement 109, the effect on deferred tax assets and
liabilities of a change in tax rates is recognized in income in
the period that includes the enactment date.
Effective March 1, 1993, the Company adopted Statement 109 and
has reported the cumulative effect of that change in the method
of accounting for income taxes in the 1994 consolidated statement
of operations (note 11).
(Continued)
<PAGE>
<PAGE> 61
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
Pursuant to the deferred method under APB Opinion 11, which was
applied in 1993 and prior years, deferred income taxes are
recognized for income and expense items that are reported in
different years for financial reporting purposes using the tax
rate applicable for the year of calculation. Under the deferred
method, deferred taxes are not adjusted for subsequent changes in
tax rates.
(g) POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
In December 1990, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 106,
"Postretirement Benefits Other Than Pensions" (Statement 106).
Statement 106 requires the recognition of a liability for
obligations for postretirement benefits expected to be provided
to or for an employee to be accrued during the service lives of
the employees. The Company previously expensed the cost of such
benefits, which are principally health care, as claims were
received.
Effective March 1, 1993, the Company adopted Statement 106 and
has reported the cumulative effect of that change in the method
of accounting for postretirement benefits other than pensions in
the 1994 consolidated statement of operations (note 8).
(h) REVENUE RECOGNITION
The Company's revenues are primarily derived from services
provided to customers in both handling and storing frozen
products. Handling and storage revenue is based primarily upon
the total weight of frozen product received into and held in
storage and is recognized as earned, not as billed. Differences
between revenue earned and revenue billed are recorded as
deferred revenue. Approximately 50% of the handling revenue is
deferred until the customers' products are delivered.
The Company's transportation management services revenues are
primarily derived from freight services. Revenues are recognized
upon delivery of freight.
(i) INCOME (LOSS) PER SHARE
Income (loss) per common share is computed by dividing net income
(loss), less preferred dividend requirements, by the weighted
average number of common shares outstanding.
(j) MAJOR CUSTOMERS
Consolidated net sales to H.J. Heinz Co. and subsidiaries
amounted to approximately $26.6 million, $35.8 million and $45.5
million in the years ended the last day of February 1993, 1994
and 1995, respectively. For the year ended the last day of
February 1993, consolidated net sales to ConAgra, Inc. and
subsidiaries amounted to approximately $21.3 million. No other
customers accounted for 10% or more of consolidated sales.
(Continued)<PAGE>
<PAGE> 62
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
(k) CASH AND CASH EQUIVALENTS
The Company considers all highly liquid investment instruments
with a maturity of three months or less when purchased to be cash
equivalents. There were cash equivalents of $-0- and $25.2
million as of the last day of February 1994 and 1995,
respectively.
(2) NET PROPERTY, PLANT AND EQUIPMENT
Net property, plant and equipment consists of the following (in
thousands):
Last day
of February
-----------
1994 1995
---- ----
Land $ 31,476 $ 31,087
Refrigerated facilities, buildings
and land improvements 426,275 433,667
Machinery and equipment 56,702 59,300
------- -------
514,453 524,054
Less accumulated depreciation 138,681 156,806
------- -------
Net property, plant and equipment $375,772 $367,248
======= =======
(3) OTHER NONCURRENT ASSETS
Other noncurrent assets consist of the following (in thousands):
Last day
of February
-----------
1994 1995
---- ----
Restricted funds held by
trustee (note 7) $ 21,899 $ 20,669
Real estate owned, less
allowance for loss of $43
and $-0-, respectively 440 300
Security deposits 424 393
Other 3,398 5,012
------- -------
$ 26,161 $ 26,374
======= =======
(Continued)<PAGE>
<PAGE> 63
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
(4) LEASES
Assets under capital leases are included in net property, plant
and equipment and consist of the following (in thousands):
Last day
of February
-----------
1994 1995
---- ----
Land, refrigerated facilities,
buildings and land improvements $ 7,140 $ 7,140
Machinery and equipment 4,255 4,249
------- -------
11,395 11,389
Less accumulated depreciation 3,540 3,575
------- -------
$ 7,855 $ 7,814
======= =======
Future minimum lease payments under noncancelable leases for
years ending after the last day of February 1995 are as follows
(in thousands):
Year ending the last Capital Operating
day of February leases leases
- -------------------- ------- ---------
1996 $1,826 $ 7,962
1997 1,548 6,798
1998 3,773 5,472
1999 522 4,626
2000 402 2,974
Thereafter 1,808 5,006
------ ------
Total minimum
lease payments 9,879 $32,838
======
Less amounts representing
interest 2,424
------
Present value of net
minimum lease
payments $7,455
=====
Included in expenses for the years ended the last day of
February 1993, 1994 and 1995 are approximately $8.7 million, $9.1
million and $9.5 million, respectively, of rental expense net of
sublease rentals for operating leases.
(Continued)<PAGE>
<PAGE> 64
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
(5) ACCRUED EXPENSES
Accrued expenses consist of the following (in thousands):
Last day
of February
-----------
1994 1995
---- ----
Accrued payroll $1,498 $ 4,226
Accrued vacation pay 2,345 2,504
Accrued taxes 837 1,043
Accrued employee stock ownership plan
contribution - 750
Other 2,832 2,822
----- ------
Total accrued expenses $7,512 $11,345
===== ======
(6) OTHER CURRENT LIABILITIES
Other current liabilities consist of the following (in
thousands):
Last day
of February
-----------
1994 1995
---- ----
Workers' compensation $2,527 $1,227
Other 2,417 2,685
----- -----
$4,944 $3,912
===== =====
(Continued)<PAGE>
<PAGE> 65
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
(7) LONG-TERM DEBT
Long-term debt consists of the following (in thousands) (see note
16):
Last day
of February
-----------
1994 1995
---- ----
Capital lease obligations (9.6% and
9.5% weighted average interest rate,
respectively) $ 7,591 $ 7,455
Senior subordinated debentures -
11% fixed, due May 1, 1997 with
mandatory sinking fund payments of
$28,750 on May 1, 1995 and 1996 111,212 112,581
First mortgage bonds, Series A -
11.45% fixed, due June 30, 2002,
interest payments only to January 1,
1999 with principal amortization
commencing July 1, 1999 150,000 150,000
First mortgage bonds, Series B -
11.5% fixed, due March 1, 2005,
interest payments only to September 1,
2003 with a mandatory sinking fund
payment of $88,125 on March 1, 2004 176,250 176,250
Mortgage notes payable - various
interest rates ranging from 9.0% to
13.6% requiring monthly principal and
interest payments with maturities
ranging from 2004 to 2017 24,565 27,941
------- -------
Total long-term debt 469,618 474,227
Less current maturities of
long-term debt 2,281 31,315
------- -------
Total long-term debt, less current
maturities $467,337 $442,912
======= =======
On July 2, 1987, the Company sold $300 million in first mortgage
bonds. On March 9, 1993, the Company sold $176.25 million of the
Company's 11.5% First Mortgage Bonds, Series B, due March 1,
2005. The Company used $150 million of the proceeds from the
sale of the Series B bonds to purchase at par $150 million of
outstanding first mortgage bonds. The remaining $150 million of
such First Mortgage Bonds have been redesignated Series A First
Mortgage Bonds (together with the Series B First Mortgage Bonds,
the "First Mortgage Bonds"). The remaining net proceeds of
approximately $22.3 million were placed in escrow with the
Mortgage Bond Trustee (note 3). The bonds are secured by
mortgages or deeds of trust on 31 of the Company's facilities.
(Continued)<PAGE>
<PAGE> 66
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
On February 3, 1993, the Company entered into a bank credit
agreement with its principal bank. The bank credit agreement is
secured by the Company's trade receivables. The bank credit
agreement has an aggregate availability of $27.5 million
consisting of $20 million maximum cash borrowings and $10 million
of letter of credit funding. Any amount by which the letter of
credit borrowings exceed $7.5 million reduces the available cash
borrowing amount under the agreement by a like amount.
Availability for cash borrowings is limited by a defined
borrowing base advance formula established on the basis of
reviews of trade receivables. The unused and available amount
under the bank credit agreement was $16.3 million, of which no
amount was borrowed as of the last day of February 1995. There
were $7.3 million of letters of credit outstanding as of the last
day of February 1995.
The senior subordinated debentures are presented as of the last
day of February 1994 and 1995 net of the original issue discount
of approximately $9.4 million and accumulated accretion of
approximately $5.6 million and $7.0 million, respectively.
The Company entered into an investment agreement in connection
with the issuance of the First Mortgage Bonds which, like the
bank credit agreement, requires the Company to meet certain
affirmative and restrictive covenants. Significant restrictive
items include, among others, limitations on additional
indebtedness, liens, dividends, capital expenditures, asset
dispositions, lease commitments and investments. Also, certain
"pro-forma debt service" ratios, net worth levels and senior debt
to net worth ratios must be maintained.
As of the last day of February 1995, aggregate annual maturities
of long-term debt are as follows (in thousands):
Year ended the last
day of February
- -------------------
1996 $ 31,315
1997 2,634
1998 5,169
1999 2,374
2000 2,583
(8) EMPLOYEE BENEFIT PLANS
(a) DEFINED BENEFIT PENSION PLANS
The Company has defined benefit pension plans which cover
substantially all employees other than union employees covered by
union pension plans under collective bargaining agreements.
Benefits under these plans are based on years of credited service
and compensation during the years preceding retirement or on
years of credited service and established monthly benefit levels.
(Continued)<PAGE>
<PAGE> 67
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
Pension expense for all plans, including plans jointly
administered by industry and union representatives totaled $1.5
million, $1.4 million and $1.4 million for years ended the last
day of February 1993, 1994 and 1995, respectively. Actuarial
valuations for defined benefit plans are performed as of the end
of the plan year. The most recent actuarial valuations are as of
the last day of February 1995.
The funded status of the Company's defined benefit pension plans
and the accrued pension expense amounts recognized in the
Company's consolidated financial statements, within other
noncurrent liabilities, as of the last day of February 1994 and
1995 are as follows (in thousands):
<TABLE><CAPTION>
Last day of Last day of
February 1994 February 1995
------------------------ --------------------------
Plans with Plans with Plans with Plans with
assets in accumulated assets in accumulated
excess of benefits in excess of benefits in
accumulated excess of accumulated excess of
benefits assets benefits assets
----------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Actuarial present value of benefit
obligations:
Accumulated benefit obligations:
Vested benefits $24,482 $120 $18,025 $6,000
Nonvested benefits 460 - 150 286
------ --- ------ -----
24,942 120 18,175 6,286
------ --- ------ -----
Effect of assumed future
compensation increases 2,892 - 2,616 -
------ --- ------ -----
Projected benefit obligations
for services rendered to date 27,834 120 20,791 6,286
Plan assets at fair value 25,257 57 18,489 5,636
------ --- ------ -----
Projected benefit obligations in
excess of (less than) plan
assets 2,577 63 2,302 650
Unrecognized prior service cost (335) (3) (153) (50)
Unrecognized net gain (loss) from past
experience different from that assumed
and effects of changes in assumptions 2,132 (55) 1,915 212
------ --- ------ -----
Accrued pension liability $ 4,374 $ 5 $ 4,064 $ 812
====== === ====== =====
</TABLE>
(Continued)<PAGE>
<PAGE> 68
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
Net periodic pension expense for the years ended the last day of
February 1993, 1994 and 1995 includes the following components
(in thousands):
Last day of February
--------------------------------
1993 1994 1995
---- ---- ----
Service cost - benefits
earned during the period $ 1,005 $ 1,013 $ 1,107
Interest cost on projected
benefit obligation 1,984 2,094 2,121
Actual return on plan assets (2,097) (2,202) (2,554)
Net amortization and deferral (214) (233) (143)
------ ------ ------
Net periodic
pension expense $ 678 $ 672 $ 531
====== ====== ======
Actuarial assumptions used for determining pension expenses were:
Last day of February
--------------------------------
1993 1994 1995
---- ---- ----
Discount rate for
interest cost 9.0% 8.0% 8.5%
Rate of increase in
future compensation levels 5.0 4.0 4.0
Expected long-term rate
of return on plan assets 9.5 10.5 10.5
Plan assets are assigned to several investment management
companies and are invested in various equity and fixed fund
investments in accordance with the Company's investment policy.
(b) EMPLOYEE STOCK OWNERSHIP PLAN
The Company established an employee stock ownership plan,
effective March 1, 1987, which is intended to provide qualifying
employees an equity interest in the Company, as well as potential
retirement benefits. The trust established under the plan is
designed to invest primarily in the Company's stock.
Contributions by the Company, in the form of common or preferred
stock of the Company, or cash, or a combination thereof, may be
made to the trustee on behalf of eligible participants for each
plan year as determined by the Company's Board of Directors.
Participating employees with vested benefits, upon retirement or
termination, have the option of retaining the stock or selling it
back to the Company at its fair market value.
(c) POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
In addition to providing retirement benefits, the Company
provides certain health care and life insurance benefits for
retired employees. These benefits are provided to substantially
all employees other than certain union employees who have elected
not to participate. Prior to 1994, the Company recognized the
cost of providing retirement health benefits and life insurance
benefits as the claims or premiums were incurred.
(Continued)
<PAGE>
<PAGE> 69
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
Effective March 1, 1993, the Company adopted Financial Accounting
Standards Board Statement of Financial Accounting No. 106
(Statement 106), which required that the expected cost of
providing such benefits be accrued over the years that the
employee renders service, in a manner similar to the accounting
for pension benefits. As permitted under Statement 106, the
Company elected to recognize this change in accounting principle
on the immediate recognition basis. The cumulative effect as of
March 1, 1993 of adopting the standard resulted in a decrease in
deferred taxes of approximately $1.5 million, an increase in
accrued postretirement benefits of approximately $3.9 million,
and a one-time non-cash charge to fiscal 1994 earnings of
approximately $2.4 million.
The total of accumulated postretirement benefit obligation
(APBO), which is an unfunded obligation, is as follows:
March 1, February 28, February 28,
1993 1994 1995
-------- ------------ ------------
Retirees $2,538 $2,339 $2,314
Active employees 1,353 1,573 1,511
----- ----- -----
Total APBO $3,891 $3,912 $3,825
===== ===== =====
The components of net periodic postretirement expense for the
year ended the last day of February are as follows (in
thousands):
1994 1995
---- ----
Service cost benefits earned in period $ 90 $104
Interest cost on APBO 329 313
Amortization of unamortized prior
service cost - (22)
--- ---
$419 $395
=== ===
The discount rate used to determine the APBO and net periodic
expense as of March 1, 1993 was 9%, as of February 28, 1994 was
8.5%, and as of February 28, 1995 was 9%.
For fiscal 1995, an 11.75% increase in the medical cost trend
rate was assumed. This rate decreases incrementally to 6% after
nine years. A 1% increase in the medical trend rate would
increase the APBO by $.1 million and increase the net periodic
expense by a negligible amount. (Continued)<PAGE>
<PAGE> 70
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
(9) COMMON STOCKHOLDERS' EQUITY
The Company has reserved 300,000 shares of common stock for
issuance under a stock option plan established in 1987. Under
the plan, options are granted by the compensation committee of
the Board of Directors to purchase common stock at a price not
less than 85% of the fair market value on the date the option is
granted.
Information with regard to the plan as of the last day of
February 1995 follows:
Number of Shares Price Exercisable Expires
- ---------------- ----- ----------- -------
93,795 $10.00 93,795 May 1998
100,000 18.95 80,000 June 2000
30,000 21.88 6,000 May 2003
30,000 20.40 6,000 December 2003
No options had been exercised as of the last day of February
1995.
The Company had reserved 500,000 shares of common stock for
issuance under a Stock Incentive Plan effective March 1, 1991.
Under the terms of the plan, officers and key management
employees can receive either common stock or cash in specified
amounts depending upon the financial performance of the Company
measured over a four-year period ending February 28, 1995. As of
the last day of February 1995, no shares had been issued. Since
inception of the plan, the Board has approved a total award of
approximately 106,000 shares. Total expense accrued under this
plan was approximately $1 million with no expense accrued for
each of the years ended the last day of February 1993 and 1994.
The Board suspended the plan effective February 28, 1994, and the
Company issued shares previously awarded and paid cash for the
specified amounts in March 1995.
(10) PREFERRED STOCK
The Company contributes shares of its Series A, variable rate,
cumulative preferred stock to the Americold Employee Stock
Ownership Plan (ESOP). The preferred stock is redeemable by
participants of the plan (note 8). As of the last day of
February 1994 and 1995, dividends not declared on the Company's
cumulative preferred stock total approximately $381 and $496,
respectively. (Continued)<PAGE>
<PAGE> 71
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
(11) INCOME TAXES
Prior to 1994, the Company provided for income taxes under APB
11. Effective March 1, 1993, the Company adopted Financial
Accounting Standards Board Statement of Financial Accounting
Standards No. 109 (Statement 109) which required a change in the
method of providing for income taxes. As permitted under
Statement 109, the Company elected to recognize this change in
accounting principle on the immediate recognition basis. The
cumulative effects as of March 1, 1993 of adopting Statement 109
were an increase in net fixed assets of approximately $31.2
million (the amount of a previous write-down of assets under APB
No. 16 as a result of the purchase of the Company in
December 1986, net of subsequent depreciation), an increase in
deferred income taxes of $93 million, and a one-time, non-cash
charge of approximately $61.8 million in fiscal 1994.
Application of Statement 109 has reduced earnings before
cumulative effect of accounting principle change by approximately
$1.7 million and $2.0 million as a result of increased
depreciation for the years ended the last day of February 1994
and 1995, respectively.
The provision (benefit) for income taxes consists of the
following (in thousands):
1993 1994 1995
---- ---- ----
Federal:
Current $ 275 $ 500 $2,867
Deferred 1,649 (1,557) 1,494
----- ------ -----
1,924 (1,057) 4,361
----- ------ -----
State:
Current 647 68 820
Deferred (116) (194) 46
----- ------ -----
$2,455 $(1,183) $5,227
===== ====== =====
(Continued)<PAGE>
<PAGE> 72
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
Following is a reconciliation of the difference between income
taxes computed at the federal statutory rate and the provision
for income taxes (in thousands):
1993 1994 1995
---- ---- ----
Computed income tax expense
(benefit) at federal
statutory rate $(1,936) $(4,278) $3,777
State and local income taxes,
net of federal income
tax benefits 351 (418) 563
Adjustment to deferred tax
assets and liabilities for
changes in enacted rates - 2,627 _
Amortization of cost in excess
of net assets acquired 861 886 887
Financial statement
depreciation not
deductible for income
tax purposes 3,429 - -
Other, net (250) - -
----- ------ -----
Provision (benefit) for
income taxes $2,455 $(1,183) $5,227
===== ====== =====
Deferred income taxes for 1994 and 1995 reflect the impact of
"temporary differences" between amounts of assets and liabilities
for financial reporting purposes and such amounts as measured by
tax laws. These temporary differences are determined in
accordance with Statement 109 and are more inclusive in nature
than "timing differences" as determined under previously
applicable accounting principles.
(Continued)
<PAGE>
<PAGE> 73
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the related
amounts used for income tax purposes. Significant components of
the Company's deferred tax liabilities and assets as of
February 28, 1994 and 1995 are as follows (in thousands):
1994 1995
---- ----
Deferred tax liabilities:
Property, plant and equipment,
due to differences in
depreciation and prior
accounting treatment $(113,372) $(113,457)
Other, net (1,481) (400)
-------- --------
Total deferred
tax liabilities (114,853) (113,857)
-------- --------
Deferred tax assets:
Receivables, due to allowance
for doubtful accounts 388 123
Employee compensation and
other benefits 2,382 1,742
Capital leases, net 2,019 1,936
Postretirement benefits other
than pensions, due to accrual
for financial reporting
purposes 1,535 1,500
Net operating loss carryforwards 3,585 -
Alternative minimum tax
credit carryforwards 1,289 3,122
Other, net 417 656
-------- --------
Total deferred tax assets 11,615 9,079
-------- --------
Net deferred tax liability
before valuation
allowance (103,238) (104,778)
Deferred tax asset valuation
allowance (1,320) (1,320)
-------- --------
Net deferred tax
liability $(104,558) $(106,098)
======== ========
The valuation allowance for deferred tax assets as of March 1,
1993 was approximately $1.3 million. The valuation allowance is
required to reduce the amount of deferred tax assets to an amount
which will more likely than not be realized. (Continued)<PAGE>
<PAGE> 74
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
The Omnibus Budget Reconciliation Act of 1993 resulted in a
federal tax rate increase from 34% to 35% effective January 1,
1993. The tax rate increase resulted in additional income tax
expense for the Company of $2.6 million during the year ended the
last day of February 1994.
At February 28, 1995, the Company has an alternative minimum tax
credit carryforward of approximately $3.1 million available to
offset future regular taxes in excess of future alternative
minimum taxes.
(12) EXTRAORDINARY ITEM
In conjunction with the fiscal year 1994 retirement of the $150
million of first mortgage bonds as discussed in Note 7,
unamortized issuance costs of approximately $3.0 million were
written off, resulting in an extraordinary loss, net of taxes, of
approximately $1.8 million.
(13) DISCLOSURES ABOUT THE FAIR VALUE OF FINANCIAL INSTRUMENTS
CASH, TRADE RECEIVABLES, OTHER RECEIVABLES, ACCOUNTS PAYABLE, AND
ACCRUED EXPENSES
The carrying amount approximates fair value because of the short
maturity of these instruments.
LONG-TERM DEBT
The fair values of each of the Company's long-term debt
instruments are based on (a) the amount of future cash flows
associated with each instrument discounted using the Company's
current borrowing rate for similar debt instruments of comparable
maturity or (b) in the case of the first mortgage bonds - Series
B and senior subordinated debentures, market price.
As of last day of February 1995
-------------------------------
Estimated fair
Carrying market
amount value
-------- ---------
Senior subordinated debentures $112,581 $ 88,550
First mortgage bonds - Series A 150,000 150,000
First mortgage bonds - Series B 176,250 160,388
Mortgage notes payable 27,941 27,941
(Continued)<PAGE>
<PAGE> 75
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
LIMITATIONS
Fair value estimates are made at a specific point in time, based
on relevant market information and information about the
financial instrument. These estimates are subjective in nature
and involve uncertainties and matters of significant judgment and
therefore cannot be determined with precision. Changes in
assumptions could significantly affect the estimates.
(14) GAIN ON INSURANCE SETTLEMENT
Gain on insurance settlement of approximately $17 million relates
to the Company's settlement of its first party claims with its
insurance carriers for business interruption, property damage and
out-of-pocket expenses with respect to the December 1991 fire at
the Company's Kansas City, Kansas warehouse facility.
No previous income recognition was determinable until the Company
had settled all of the lawsuits and claims related to the fire.
The settlement amounts have been used to reduce other receivables
recorded as of the last day of February 1994 by $5.7 million.
(15) CASH AND CASH EQUIVALENTS
The Company has made a proposal to the Trustee under the
indenture related to its First Mortgage Bonds to substitute
approximately $4.8 million in cash as collateral for the property
cost of the Kansas City, Kansas warehouse facility, although no
agreement has been reached for such substitution. The Company
has not reclassified any cash balance for the possible payment.
(16) SUBSEQUENT EVENTS
On May 9, 1995, the Company filed a proposed "prepackaged" plan
of reorganization under Chapter 11 of the United States
Bankruptcy Code (the Plan) in the United States Bankruptcy Court
for the District of Oregon (the Court). The principal purpose of
the Plan is to reduce the Company's short-term cash requirements
with respect to payments due on its subordinated indebtedness and
to adjust certain restrictive financial covenants and certain
other provisions contained in the Amended and Restated Investment
Agreement, dated March 2, 1993, between the Company and
Metropolitan Life Insurance Company. On the filing date, the
Plan had received approval from both classes of debtholders
entitled to vote.
A hearing is scheduled for June 19, 1995 at which the Court will
consider the Company's motion requesting the Court to (1) approve
the Company's Disclosure Statement dated April 14, 1995 and the
Company's procedure for solicitation of votes to accept or reject
the Plan, and (2) to confirm the Plan.
Pending the outcome of the bankruptcy case, the Company intends
to operate its business in the ordinary course, and to pay all
pre-petition claims of the Company's secured lenders, trade
creditors and employees in full.
(Continued)<PAGE>
<PAGE> 76
AMERICOLD CORPORATION
Notes to Consolidated Financial Statements
The Plan also provides that:
- Each holder of the Company's 11% Senior
Subordinated Debentures due 1997 will receive
a corresponding amount of the new 15% Senior
Subordinated Debentures due 2007, and an
amount in cash equal to the accrued but
unpaid interest on the old Senior
Subordinated Debentures through but excluding
the effective date of the Plan. The new
debentures will be immediately callable at
par. The Company did not make the mandatory
sinking fund payment on the 11% Debentures of
approximately $28.75 million due May 1, 1995.
The Company is currently out of compliance
with certain covenants.
- The Company's 11.45% First Mortgage Bonds,
Series A due 2002 and its 11.5% First
Mortgage Bonds, Series B due 2005, will
remain unaffected. As part of the Plan, the
Company will repurchase $10 million of the
Series A Bonds due 2002 at par, will pay a
modification fee of $2.25 million to the
Metropolitan Life Insurance Company, and has
the option to purchase, in whole or in part,
additional Series A Bonds at par for a period
of 18 months following the effective date.
- The investment agreement between the Company
and Metropolitan Life Insurance Company will
be amended, subject to confirmation, to
reflect the restructuring and will, in
certain cases, contain covenants which are
less restrictive than those contained in the
existing investment agreement.
The Company's existing bank credit agreement will be extended and
modified pending the confirmation of the Plan.
The Company retained a "Financial Advisor" for advice and
assistance with respect to the evaluation of available
alternatives related to refinancing or other restructuring of the
Company's debt and debt repayment obligations, and implementation
of its financing strategies, and otherwise to advise and assist
the Company with respect to the Plan. Total fees approximating
$2.1 million will be paid to the Financial Advisor. <PAGE>
<PAGE> 77 SCHEDULE II
-----------
AMERICOLD CORPORATION
Valuation and Qualifying Accounts
Years ended the last day of February 1993, 1994 and 1995
(In Thousands)
<TABLE>
<CAPTION>
Additions
Balance at charged to Balance
beginning costs and at end
of period expenses Deductions of period
---------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
Year ended the last day
of February 1993 -
Allowance for
doubtful accounts -
other receivables $ - $4,100 $ - $4,100
Year ended the last day
of February 1994 -
Allowance for
doubtful accounts -
other receivables 4,100 - - 4,100
Year ended the last day
of February 1995 -
Allowance for
doubtful accounts -
other receivables 4,100 - 4,100 -
</TABLE>
<PAGE>
<PAGE> 78
AMERICOLD CORPORATION
FORM 10-K
EXHIBIT INDEX
Exhibit Page
- -------- ----
(2) Plan of Reorganization 79
(3) Restated Bylaws, as amended 124
(11) Statement re Computation of Per Share
Earnings 145
(21) Subsidiaries of the Registrant 146
(23) Consent of KPMG Peat Marwick LLP 147
*(27) Financial Data Schedule
148
<PAGE>
<PAGE> 79 EXHIBIT 2
Albert N. Kennedy, OSB 82142
Loree A. Devery, OSB 88191
TONKON, TORP, GALEN, MARMADUKE & BOOTH
1600 Pioneer Tower
888 S.W. Fifth Avenue
Portland, OR 97204-2099
(503) 221-1440
Of Attorneys for Debtor
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF OREGON
In re
AMERICOLD CORPORATION,
Debtor.<PAGE>
)
)
)
)
)<PAGE>
Case No. 395-33058elp-11
DEBTOR'S PLAN OF
REORGANIZATION
(May 9, 1995)
<PAGE>
<PAGE> 80
TABLE OF CONTENTS
Page
ARTICLE 1. DEFINITIONS . . . . . . . . . . . . . . . . . . 1
ARTICLE 2. ADMINISTRATIVE EXPENSE CLAIMS AND PRIORITY
TAX CLAIMS. . . . . . . . . . . . . . . . . . . 11
ARTICLE 3. CLASSIFICATION. . . . . . . . . . . . . . . . . 11
ARTICLE 4. TREATMENT OF UNIMPAIRED CLASSES . . . . . . . . 13
ARTICLE 5. TREATMENT OF IMPAIRED CLASSES . . . . . . . . . 16
ARTICLE 6. NO BAR DATE; DISPUTED CLAIMS; OBJECTIONS TO
CLAIMS. . . . . . . . . . . . . . . . . . . . . 17
ARTICLE 7. IMPLEMENTATION OF THE PLAN. . . . . . . . . . . 18
ARTICLE 8. EXECUTORY CONTRACTS AND UNEXPIRED LEASES. . . . 26
ARTICLE 9. CONDITIONS PRECEDENT. . . . . . . . . . . . . . 27
ARTICLE 10. MODIFICATION, REVOCATION OR WITHDRAWAL OF THE
PLAN. . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE 11. RETENTION OF JURISDICTION . . . . . . . . . . . 30
ARTICLE 12. MISCELLANEOUS PROVISIONS. . . . . . . . . . . . 33
EXHIBITS
1. FORM OF NEW SUBORDINATED DEBENTURE INDENTURE
2. FORM OF NEW INVESTMENT AGREEMENT
3. COMMITMENT LETTER DATED APRIL 3, 1995 FROM UNITED
STATES NATIONAL BANK OF OREGON
<PAGE>
<PAGE> 81
Americold Corporation, as Debtor and Debtor-In-
Possession, proposes this Plan of Reorganization pursuant to
Section 1121(a) of Title 11 of the United States Code.
ARTICLE 1.
DEFINITIONS
RULES OF INTERPRETATION. As used herein, the following
terms have the respective meanings specified below, and such
meanings shall be equally applicable to both the singular and
plural, and masculine and feminine, forms of the terms defined.
The words "herein," "hereof," "hereto," "hereunder" and others of
similar import, refer to the Plan as a whole and not to any
particular section, subsection or clause contained in the Plan.
Captions and headings to articles, sections and exhibits are
inserted for convenience of reference only and are not intended
to be part of or to affect the interpretation of the Plan. The
rules of construction set forth in section 102 of the Bankruptcy
Code shall apply. In computing any period of time prescribed or
allowed by the Plan, the provisions of Bankruptcy Rule 9006(a)
shall apply. Any capitalized term used herein that is not
defined herein but is defined in the Bankruptcy Code shall have
the meaning ascribed to such term in the Bankruptcy Code. In
addition to such other terms as are defined in other sections of
the Plan, the following terms (which appear in the Plan as
capitalized terms) have the following meanings as used in the<PAGE>
<PAGE> 82
Plan.
1.1 "Administrative Expense Claim" means any Claim
entitled to the priority afforded by sections 503(b) and
507(a)(1) of the Bankruptcy Code.
1.2 "Allowed" means, with respect to any Claim, proof
of which has been properly Filed or, if no proof of claim was so
Filed, which was or hereafter is listed on the Schedules as
liquidated in amount and not disputed or contingent, and, in
either case, a Claim as to which no objection to the allowance
thereof, or motion to estimate for purposes of allowance, shall
have been Filed on or before any applicable period of limitation
that may be fixed by the Bankruptcy Code, the Bankruptcy Rules
and/or the Bankruptcy Court, or as to which any objection, or any
motion to estimate for purposes of allowance, shall have been so
Filed, to the extent allowed by a Final Order; provided that all
Class 7 Claims (excluding any Rejection Claims arising pursuant
to Article 8 of the Plan) shall be treated for all purposes as if
the Chapter 11 Case was not filed, and the determination of
whether any such Claim shall be allowed and/or the amount thereof
shall be determined, resolved or adjudicated, as the case may be,
in the manner in which such Claim would have been determined,
resolved or adjudicated if the Chapter 11 Case had not been
commenced.
1.3 "Ballot Agent" means Tonkon, Torp, Galen,<PAGE>
<PAGE> 83
Marmaduke & Booth.
1.4 "Ballot Record Date" means March 31, 1995.
1.5 "Ballot Return Date" means 3:00 p.m., Portland,
Oregon time, on May 8, 1995, unless and to the extent such date
is extended by the Debtor in accordance with the provisions of
the Disclosure Statement.
1.6 "Ballots" means the ballots and/or master ballots
distributed to the holders of Old Subordinated Debentures and the
Institutional Investor for the purposes of voting on the Plan.
1.7 "Bankruptcy Code" means the Bankruptcy Reform Act
of 1978, as amended from time to time, set forth in sections 101
et seq. of title 11 of the United States Code.
1.8 "Bankruptcy Court" means the United States
Bankruptcy Court for the District of Oregon, or such other court
that exercises jurisdiction over the Chapter 11 Case or any
proceeding therein, including the United States District Court
for the District of Oregon to the extent that the reference of
the Chapter 11 Case or any proceeding therein is withdrawn.
1.9 "Bankruptcy Rules" means, collectively, the
Federal Rules of Bankruptcy Procedure, as amended and promulgated
under section 2075, title 28 of the United States Code, and the
local rules and standing orders of the Bankruptcy Court.
1.10 "Bank" means United States National Bank of
Oregon.<PAGE>
<PAGE> 84
1.11 "Bank's Secured Claim" means the Secured Claim of
the Bank which, for purposes of the Plan, shall be deemed to be
Allowed in an amount equal to the excess of (a) the sum of
(i) all of the Obligations (as such term is defined in the Credit
Agreement) as of the Petition Date and as described in the Cash
Collateral Order, (ii) an amount equal to 100% of the interest
that accrued pursuant to the Credit Agreement at the contract
rate from and including the Petition Date through and including
the Effective Date, (iii) all payments required under all Letters
of Credit outstanding (as such term is defined in the Credit
Agreement) from and including the Petition Date through and
including the Effective Date and (iv) to the extent provided by
the Credit Documents (as such term is defined in the Credit
Agreement), an amount equal to 100% of any and all costs and
expenses, including, without limitation, attorneys' fees which
remain unpaid as of the Effective Date over (b) the sum of all
payments made in cash by the Debtor to the Bank pursuant to
Sections 361, 363 and/or 364 of the Bankruptcy Code prior to the
Effective Date on account of the obligations described in
subparagraph (a) herein.
1.12 "Business Day" means a day other than a Saturday,
Sunday or other day on which banks in Portland, Oregon are
authorized or required by law to be closed.
1.13 "Cash Collateral Order" means an order of the<PAGE>
<PAGE> 85
Bankruptcy Court authorizing the Debtor to use, subject to the
terms and provisions thereof, the cash proceeds of the Debtor's
pre-Petition Date accounts receivable and inventory.
1.14 "Chapter 11 Case" means the case under chapter 11
of the Bankruptcy Code with respect to the Debtor, pending or to
be pending in the District of Oregon, administered as IN RE
AMERICOLD CORPORATION, Case No. 395-33058elp-11.
1.15 "Claim" means (a) any right to payment from the
Debtor arising before the Effective Date, whether or not such
right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal,
equitable, secured or unsecured or (b) any right to an equitable
remedy against the Debtor arising before the Effective Date for
breach of performance if such breach gives rise to a right of
payment from the Debtor, whether or not such right to an
equitable remedy is reduced to judgment, fixed, contingent,
matured, unmatured, disputed, undisputed, secured or unsecured.
1.16 "Class" means one of the classes of Claims or
Interests defined in Article 3 hereof.
1.17 "Confirmation Date" means the date on which the
Confirmation Order is entered on the docket by the Clerk of the
Bankruptcy Court.
1.18 "Confirmation Order" means the order of the
Bankruptcy Court confirming the Plan in accordance with the<PAGE>
<PAGE> 86
provisions of chapter 11 of the Bankruptcy Code.
1.19 "Creditors' Committee" means the official
committee of unsecured creditors appointed in the Chapter 11 Case
by the United States Trustee pursuant to Section 1102 of the
Bankruptcy Code, as reconstituted by the addition or removal of
members from time to time.
1.20 "Debenture Holders Committee" means the official
committee of holders of the Old Subordinated Debentures appointed
in the Chapter 11 case by the United States Trustee pursuant to
Section 1102 of the Bankruptcy Code, as reconstituted by the
addition or removal of members from time to time.
1.21 "Debtor" means Americold Corporation, as debtor
and debtor-in-possession in the Chapter 11 Case.
1.22 "Disclosure Statement" means the Debtor's
Disclosure Statement, dated April 14, 1995, as amended, modified,
restated or supplemented from time to time, pertaining to the
Plan.
1.23 "Distribution Record Date" means the date on which
the Confirmation Order is signed.
1.24 "Effective Date" means the Business Day on which
all of the conditions specified in Section 9.1 hereof are first
satisfied and/or waived in accordance with Article 9 of the Plan.
1.25 "Employee Claim" means a Claim based on salaries,
wages, sales commissions, expense reimbursements, accrued <PAGE>
<PAGE> 87
vacation pay, health-related benefits, incentive programs, stock
incentive programs, employee compensation guarantees, severance
or similar employee benefits.
1.26 "Filed" means filed with the Bankruptcy Court in
the Chapter 11 Case.
1.27 "Final Order" means an order or judgment entered
on the docket by the Clerk of the Bankruptcy Court or any other
court exercising jurisdiction over the subject matter and the
parties (a) that has not been reversed, stayed, modified or
amended, (b) as to which no appeal, certiorari proceeding,
reargument or other review or rehearing has been requested or is
still pending and (c) as to which the time for filing a notice of
appeal or petition for certiorari, or request for reargument or
further review or rehearing shall have expired.
1.28 "Financing Lease" means any lease pursuant to
which the Debtor is the lessee that is intended to grant a
security interest in the leased property to the lessor under such
lease.
1.29 "First Mortgage Bonds" means the Debtor's 11.45%
First Mortgage Bonds, Series A, and 11 1/2% First Mortgage Bonds,
Series B.
1.30 "First Mortgage Bond Indenture" means the Amended
and Restated Indenture, dated as of March 9, 1993, as amended,
modified, restated or supplemented from time to time, between the<PAGE>
<PAGE> 88
Debtor and Shawmut Bank Connecticut, National Association, as
indenture trustee, relating to the First Mortgage Bonds.
1.31 "Interest" means the rights of the owners of the
issued and outstanding shares of capital stock of Debtor,
including preferred and common stock, and options to acquire
capital stock of Debtor.
1.32 "Institutional Investor" means Metropolitan Life
Insurance Company.
1.33 "Lease Secured Claim" means any Claim of a lessor
under a Financing Lease.
1.34 "New Credit Agreement" means an agreement to be
executed as of the Effective Date between the Reorganized Debtor
and the Bank pursuant to the commitment letter dated April 3,
1995 from the Bank to the Debtor and attached to the Plan as
Exhibit 3.
1.35 "New Investment Agreement" means the Second
Amended and Restated Investment Agreement, dated as of the
Effective Date, to be entered into by the Reorganized Debtor and
the Institutional Investor, substantially in the form of
Exhibit 2 attached to and incorporated in the Plan.
1.36 "New Subordinated Debentures" means the Debtor's
15% Senior Subordinated Debentures due 2007, issuable pursuant to
the New Subordinated Debenture Indenture and described in the
Disclosure Statement.<PAGE>
<PAGE> 89
1.37 "New Subordinated Debenture Indenture" means the
Indenture, dated as of the Effective Date, to be entered into by
the Reorganized Debtor with respect to the New Subordinated
Debentures, substantially in the form of Exhibit 1 to the Plan.
1.38 "Old Credit Agreement" means the Credit Agreement,
dated as of February 3, 1993, as amended, modified, restated or
supplemented from time to time, between the Debtor and Bank.
1.39 "Old Investment Agreement" means the Amended and
Restated Investment Agreement, dated March 2, 1993, between
Debtor and the Institutional Investor.
1.40 "Old Subordinated Debentures" means the Debtor's
11% Senior Subordinated Debentures due 1997.
1.41 "Old Subordinated Debenture Claim" means a Claim
of a holder of Old Subordinated Debentures which, for purposes of
the Plan, shall be deemed to be an amount equal to the sum of (a)
the face amount of Old Subordinated Debentures held by such
holder and (b) an amount equal to 100% of the accrued and unpaid
interest at the contract rate on such Old Subordinated
Debentures, through but not including the Effective Date.
1.42 "Old Subordinated Debenture Indenture" means the
Indenture, dated as of May 1, 1987, as amended, modified,
restated or supplemented from time to time, between the Debtor
and United States Trust Company of New York, as indenture
trustee, relating to the Old Subordinated Debentures.<PAGE>
<PAGE> 90
1.43 "Other Priority Claim" means any Claim for an
amount entitled to priority in right of payment under section
507(a)(3), (4), (5) or (6) of the Bankruptcy Code.
1.44 "Petition Date" means May 9, 1995, the date on
which the petition commencing the Chapter 11 Case was filed.
1.45 "Plan" means this plan of reorganization, as
amended, modified, restated or supplemented from time to time.
1.46 "Priority Tax Claim" means a Claim of a
governmental unit of the kind entitled to priority under section
507(a)(8) of the Bankruptcy Code.
1.47 "Reorganized Debtor" means the Debtor from and
after the Effective Date.
1.48 "Rejection Claim" means a Claim arising from the
rejection of an unexpired lease or executory contract pursuant to
this Plan or Final Order of the Bankruptcy Court.
1.49 "Restated Articles of Incorporation" means the
restated articles of incorporation of the Debtor, which shall
modify and amend Debtor's Articles of Incorporation to prohibit
the issuance of non-voting equity securities to the extent
required by section 1123(a)(6) of the Bankruptcy Code.
1.50 "Schedules" means the schedules of assets and
liabilities and the statement of financial affairs Filed by the
Debtor pursuant to section 521 of the Bankruptcy Code, as
amended, modified, restated or supplemented from time to time.<PAGE>
<PAGE> 91
1.51 "Secured Claim" means any Claim against the Debtor
held by any Entity, including, without limitation, an Affiliate
or judgment creditor of the Debtor, to the extent such Claim
constitutes a secured Claim under sections 506(a) or 1111(b) of
the Bankruptcy Code.
1.52 "Series A Bonds" means the Debtor's 11.45% First
Mortgage Bonds, Series A, due 2002.
1.53 "Series A Bond Claim" means a Claim of a holder of
Series A Bonds.
1.54 "Series B Bonds" means the Debtor's 11 1/2% First
Mortgage Bonds, Series B, due 2005.
1.55 "Series B Bond Claim" means a Claim of a holder of
Series B Bonds.
1.56 "Trade Claim" means any Claim of any Entity
against the Debtor for goods provided and/or services in the
ordinary course rendered by such Entity to the Debtor.
ARTICLE 2.
ADMINISTRATIVE EXPENSE CLAIMS AND PRIORITY TAX CLAIMS
2.1 ADMINISTRATIVE EXPENSE CLAIMS AND PRIORITY TAX
CLAIMS. Each holder of an Allowed Administrative Expense Claim
and each holder of an Allowed Priority Tax Claim shall be paid in
full in cash on the later of (a) the Effective Date and (b) the
date on which such Claim becomes Allowed, unless such holder
shall agree to a different treatment of such Claim (including,<PAGE>
<PAGE> 92
without limitation, any different treatment that may be provided
for in any documentation, statute or regulation governing such
Claim); provided, however, that Administrative Expense Claims
representing obligations incurred in the ordinary course of
business by the Debtor during the Chapter 11 Case shall be paid
by the Debtor or the Reorganized Debtor in the ordinary course of
business and in accordance with any terms and conditions of the
particular transaction, and any agreements relating thereto.
Holders of Priority Tax Claims will not be required to file a
Proof of Claim.
ARTICLE 3.
CLASSIFICATION
For purposes of the Plan, Claims and Interests are
classified as provided below. A Claim or Interest is classified
in a particular Class only to the extent that such Claim or
Interest qualifies within the description of such Class and is
classified in a different Class to the extent that such Claim or
Interest qualifies within the description of such different
Class.
3.1 CLASS 1. OTHER PRIORITY CLAIMS. Class 1 consists
of all Allowed Other Priority Claims.
3.2 CLASS 2. BANK'S SECURED CLAIM. Class 2 consists
of the Bank's Secured Claim.
3.3 CLASS 3. MISCELLANEOUS SECURED CLAIMS. Class 3<PAGE>
<PAGE> 93
consists of all Allowed Lease Secured Claims and all Allowed
Secured Claims, other than the Allowed Secured Claims that are
otherwise classified hereby. Each such Claim shall be deemed to
be placed in a separate subclass.
3.4 CLASS 4. SERIES B BOND CLAIMS. Class 4 consists
of the Allowed Secured Claims of all holders of Series B Bonds.
3.5 CLASS 5. SERIES A BOND CLAIMS. Class 5 consists
of all Allowed Secured Claims of the holders of Series A Bonds
other than the Claim of the Institutional Investor.
3.6 CLASS 6. INSTITUTIONAL INVESTOR CLAIM. Class 6
consists of the Allowed Secured Claim of the Institutional
Investor.
3.7 CLASS 7. GENERAL UNSECURED CLAIMS. Class 7
consists of all Allowed Claims (including, without limitation,
Employee Claims and Trade Claims), other than Claims that are
otherwise classified hereby, Administrative Expense Claims and
Priority Tax Claims.
3.8 CLASS 8. OLD SUBORDINATED DEBENTURE CLAIMS.
Class 8 consists of all Allowed Claims of holders of Old
Subordinated Debentures.
3.9 CLASS 9. PREFERRED STOCK INTERESTS. Class 9
consists of the Interests of the holders of Debtor's preferred
stock.
3.10 CLASS 10. INTERESTS. Class 10 consists of the<PAGE>
<PAGE> 94
Interests of the holders of Debtor's common stock, and holders of
options to acquire common stock.
ARTICLE 4.
TREATMENT OF UNIMPAIRED CLASSES
4.1 CLASS 1 (OTHER PRIORITY CLAIMS). Each holder of
an Allowed Class 1 Claim shall be paid in full in cash the amount
of its Allowed Class 1 Claim on the later of (a) the Effective
Date and (b) the date on which such Claim becomes Allowed, unless
such holder shall agree to a different treatment of such Claim
(including, without limitation, any different treatment that may
be provided for in any documentation governing such Claim).
4.2 CLASS 2 (BANK'S SECURED CLAIM). The holder of the
Bank's Secured Claim shall receive one of the following
alternative treatments, at the election of the Debtor made on or
prior to the Effective Date:
(a) Such Claim shall be paid in full in cash.
(b) The legal, equitable, and contractual rights to
which such Claim entitles the holder thereof shall be unaltered
by the Plan.
(c) Such Claim shall receive the treatment described
in Section 1124(2) of the Bankruptcy Code.
4.3 CLASS 3 (MISCELLANEOUS SECURED CLAIMS). With
respect to each Allowed Class 3 Claim, unless the holder thereof
shall agree to a different treatment of such Claim, such holder<PAGE>
<PAGE> 95
shall receive one of the following alternative treatments, at the
election of the Debtor made on or prior to the Effective Date:
(a) The legal, equitable and contractual rights to
which such Claim entitles the holder thereof shall be unaltered
by the Plan.
(b) Such Claim shall receive the treatment described
in section 1124(2) of the Bankruptcy Code.
With respect to any Claim which receives the treatment
described in clause "a" or "b" above, the Debtor's failure to
object to such Claim in the Chapter 11 Case shall be without
prejudice to the Debtor's right to contest or otherwise defend
against such Claim in an applicable nonbankruptcy forum when and
if such Claim is sought to be enforced by the holder thereof
after the Effective Date.
4.4 CLASS 4 (SERIES B BOND CLAIMS). Each holder of an
Allowed Class 4 Claim shall receive one of the following alterna-
tive treatments, at the election of the Debtor made on or prior
to the Effective Date:
(a) The legal, equitable, and contractual rights to
which such Claim entitles the holder thereof shall be unaltered
by the Plan.
(b) Such Claim shall receive the treatment described
in Section 1124(2) of the Bankruptcy Code.
4.5 CLASS 5 (SERIES A BOND CLAIMS). Each holder of an<PAGE>
<PAGE> 96
Allowed Class 5 Claim shall receive one of the following alterna-
tive treatments, at the election of the Debtor made on or prior
to the Effective Date:
(a) The legal, equitable, and contractual rights to
which such Claim entitles the holder thereof shall be unaltered
by the Plan.
(b) Such Claim shall receive the treatment described
in Section 1124(2) of the Bankruptcy Code.
4.6 CLASS 7 (GENERAL UNSECURED CLAIMS). With respect
to each Allowed Class 7 Claim, unless the holder thereof shall
agree to a different treatment, such holder shall receive one of
the following alternative treatments, at the election of the
Debtor made on or prior to the Effective Date:
(a) Such Claim shall be paid in full (including any
contractual or statutory unpaid interest that is due and owing)
on the later of (i) the Effective Date and (ii) the date on which
such Claim becomes Allowed, unless such holder shall agree to a
different treatment of such Claim (including, without limitation,
any different treatment that may be provided for in any
documentation governing such Claim).
(b) The legal, equitable and contractual rights to
which such Claim entitles the holder thereof shall be unaltered
by the Plan.
(c) Such Claim shall receive the treatment described<PAGE>
<PAGE> 97
in section 1124(2) of the Bankruptcy Code.
With respect to any Claim which receives the treatment
described in clause "b" or "c" above, the Debtor's failure to
object to such Claim in the Chapter 11 Case shall be without
prejudice to the Debtor's right to contest or otherwise defend
against such Claim in an applicable nonbankruptcy forum when and
if such Claim is sought to be enforced by the holder thereof
after the Effective Date.
4.7 CLASS 9 (PREFERRED STOCK INTERESTS). All holders
of Class 9 Interests shall retain their Interests in the Debtor
and Reorganized Debtor without any alteration of their legal,
equitable, or contractual rights.
4.8 CLASS 10 (INTERESTS). All holders of Class 10
Interests shall retain their Interests in the Debtor and
Reorganized Debtor without any alteration of their legal,
equitable, or contractual rights.
4.9 UNIMPAIRED CLASSES. By virtue of the foregoing
provisions of this Article 4, the Claims and Interests in Classes
1, 2, 3, 4, 5, 7, 9, and 10 are not impaired by the Plan.
Pursuant to Section 1126(f) of the Bankruptcy Code, such Classes
and each holder of a Claim or Interest in such Classes are
conclusively presumed to have accepted the Plan, and solicitation
of acceptances of holders in such Classes is not required.<PAGE>
<PAGE> 98
ARTICLE 5.
TREATMENT OF IMPAIRED CLASSES
5.1 CLASS 6 (INSTITUTIONAL INVESTOR CLAIM). The
Institutional Investor is a holder of Series A Bonds and is a
party to the Investment Agreement. The Claim of the Institu-
tional Investor as a holder of Series A Bonds will receive the
treatment set forth in Section 4.5 of this Plan relating to
Series A Bond Claims. As of the Effective Date,
(a) the Old Investment Agreement shall be cancelled
and have no further force or effect as provided in Section 7.6 of
the Plan;
(b) the Reorganized Debtor shall execute and deliver
to the Institutional Investor the New Investment Agreement; and
(c) the New Investment Agreement shall be deemed
effective and binding as provided in Section 7.5 of the Plan.
5.2 CLASS 8 (OLD SUBORDINATED DEBENTURE CLAIMS). On
the Effective Date, each holder of an Allowed Class 8 Claim shall
receive the following:
(a) Cash in an amount equal to accrued but unpaid
interest on such holder's Old Subordinated Debentures up to but
excluding the Effective Date; and
(b) New Subordinated Debentures in a principal amount
equal to the face amount of such holder's Old Subordinated
Debentures.<PAGE>
<PAGE> 99
5.3 IMPAIRED CLASSES AND INTERESTS. By virtue of the
foregoing provisions of this Article 5, Classes 6 and 8 are
impaired under the Plan. Pursuant to section 1126(a) of the
Bankruptcy Code, holders in Classes 6 and 8 are entitled to vote
to accept or reject the Plan.
ARTICLE 6.
NO BAR DATE; DISPUTED CLAIMS; OBJECTIONS TO CLAIMS
6.1 NO BAR DATE, DISPUTED CLAIMS, OBJECTIONS TO
CLAIMS. Except as set forth in Section 8.3 of this Plan relating
to Rejection Claims, no bar date pursuant to Bankruptcy Rule
3003(c)(3) shall be fixed as a deadline for the filing of proofs
of Claim against the Debtor. Only Claims that are Allowed shall
be entitled to distributions under the Plan. The Debtor reserves
the right to contest and object to any Claims, including, without
limitation, those Claims that are specifically referenced herein,
are not listed in the Schedules, are listed therein as disputed,
contingent and/or unliquidated in amount, or are listed therein
at a lesser amount than asserted by the holder of such Claim.
Unless otherwise ordered by the Bankruptcy Court, all objections
to Claims (other than Administrative Expense Claims) shall be
Filed and served upon counsel to the Debtor, counsel to the
Creditors' Committee, counsel to the Debenture Holders Committee
and the holder of the Claim objected to on or before the later of
(a) the Effective Date and (b) 60 days after the date (if any) on<PAGE>
<PAGE> 100
which a proof of claim is Filed in respect of such Claim. The
last day for filing objections to Administrative Expense Claims
shall be set pursuant to an order of the Bankruptcy Court. All
disputed Claims shall be resolved by the Bankruptcy Court, except
to the extent that (y) the Debtor may otherwise elect consistent
with the Plan and the Bankruptcy Code or (z) the Bankruptcy Court
may otherwise order.
ARTICLE 7.
IMPLEMENTATION OF THE PLAN
7.1 RESTATED ARTICLES OF INCORPORATION. The
Reorganized Debtor shall be deemed to have adopted the Restated
Articles of Incorporation on the Effective Date and shall
promptly thereafter cause the same to be filed with the Secretary
of State of the State of Oregon. After the Effective Date, the
Reorganized Debtor may amend the Restated Articles of
Incorporation and may amend its bylaws, in accordance with the
Restated Articles of Incorporation, such bylaws and applicable
state law.
7.2 ISSUANCE OF NEW SUBORDINATED DEBENTURES. On the
Effective Date, the Reorganized Debtor shall, in accordance with
the Plan, enter into the New Subordinated Debenture Indenture and
issue the New Subordinated Debentures thereunder to the holders
of the Allowed Subordinated Debenture Claims.
7.3 NEW CREDIT AGREEMENT. On the Effective Date, the<PAGE>
<PAGE> 101
Reorganized Debtor shall, in accordance with the Plan, enter into
the New Credit Agreement.
7.4 NEW INVESTMENT AGREEMENT. On the Effective Date,
the Reorganized Debtor shall, in accordance with the Plan, enter
into the New Investment Agreement.
7.5 EFFECTIVENESS OF SECURITIES, INSTRUMENTS AND
AGREEMENTS. On the Effective Date, all securities, instruments
and agreements entered into pursuant to the Plan, including,
without limitation, (a) the New Subordinated Debenture Indenture,
(b) the New Credit Agreement, (c) the New Investment Agreement
and (d) any security, instrument or agreement entered
into in connection with any of the foregoing shall become
effective and binding in accordance with their respective terms
and conditions upon the parties thereto and shall be deemed to
become effective simultaneously.
7.6 CANCELLATION OF SECURITIES, INSTRUMENTS AND
AGREEMENTS RELATING TO IMPAIRED CLAIMS. On the Effective Date,
except as otherwise provided herein, the Old Investment
Agreement, the Old Subordinated Debenture Indenture, and any
security, instrument or agreement entered into in connection with
the foregoing shall be deemed cancelled and terminated, and the
obligations of the Debtor relating to, arising under, in respect
of or in connection with such agreement shall be discharged.
7.7 WAIVER OF SUBORDINATION. The distributions under<PAGE>
<PAGE> 102
the Plan take into account the relative priority of each Class in
connection with any contractual subordination provisions relating
thereto. Accordingly, the distributions under this Plan shall
not be subject to levy, garnishment, attachment or other legal
process by any holder (a "Senior Creditor") of a Claim purporting
to be entitled to the benefits of such contractual subordination.
On the Effective Date, all Senior Creditors shall be deemed to
have waived any and all contractual subordination rights which
they may have with respect to such distribution, and shall be
permanently enjoined from enforcing or attempting to enforce any
such rights with respect to the distributions under the Plan.
7.8 SURRENDER OF SECURITIES. Each holder of Old
Subordinated Debentures shall surrender the same to the Debtor or
the Reorganized Debtor, and the Reorganized Debtor shall
distribute or shall cause to be distributed to the holders
thereof the appropriate New Subordinated Debentures pursuant to
this Plan. No distribution of New Subordinated Debentures
hereunder shall be made to or on behalf of any such holder unless
and until such Old Subordinated Debenture is received by the
Debtor or the Reorganized Debtor, or the unavailability of such
instrument is established to the satisfaction of the Debtor or
the Reorganized Debtor. Any such holder that fails to surrender
or cause to be surrendered such Old Subordinated Debenture, or to
execute and deliver an affidavit of loss and indemnity satisfac-<PAGE>
<PAGE> 103
tory to the Debtor or the Reorganized Debtor, and, in the event
that the Debtor or the Reorganized Debtor so requests with
respect to the Old Subordinated Debentures, fails to furnish a
bond in form and substance (including, without limitation, with
respect to amount) reasonably satisfactory to the Debtor or the
Reorganized Debtor, within two years after the Effective Date,
shall be deemed to have forfeited all Claims against the Debtor
represented by such Old Subordinated Debenture and shall not
participate in any distribution hereunder in respect of such Old
Subordinated Debenture and all property in respect of such
forfeited distribution, including (if applicable) interest
accrued thereon, shall revert to the Reorganized Debtor.
Notwithstanding the foregoing, all Claims shall be discharged and
all Interests shall be terminated by this Plan to the extent
provided herein regardless of whether and when any surrender,
indemnity or bond required by this Section is provided, and
regardless of whether the Reorganized Debtor makes a distribution
hereunder in the absence of compliance by any holder of a Claim
with the requirements of this Section. The Debtor or the
Reorganized Debtor may waive the requirements of this Section.
7.9 REGISTRATION OF NEW SUBORDINATED DEBENTURES. The
Reorganized Debtor will, at its expense, use its best efforts to
file with the Securities Exchange Commission (the "Commission")
as soon as practicable after the Effective Date a registration<PAGE>
<PAGE> 104
statement with respect to the New Subordinated Debentures. If no
such registration statement is filed within 60 days immediately
following the Effective Date, the Reorganized Debtor will file a
registration statement relating to the New Subordinated
Debentures with the Commission upon receipt of a written request
for such registration from the holders of 25% in principal amount
of the New Subordinated Debentures. Such written request must be
received by the Reorganized Debtor on or before the first
anniversary of the Effective Date.
7.10 SETOFFS. The Debtor may, but shall not be
required to, set off against any Claim and the distributions to
be made pursuant to the Plan in respect of such Claim, any claims
of any nature whatsoever which the Debtor may have against the
holder of such Claim, but neither the failure to do so nor the
allowance of any Claim hereunder shall constitute a waiver or
release of any such claim the Debtor may have against such
holder.
7.11 DISTRIBUTION OF UNCLAIMED PROPERTY. Any
distribution of property under the Plan which is unclaimed after
two years following the Effective Date shall irrevocably revert
to the Reorganized Debtor.
7.12 SATURDAY, SUNDAY OR LEGAL HOLIDAY. If any payment
or act under the Plan is required to be made or performed on a
date that is not a Business Day, then the making of such payment<PAGE>
<PAGE> 105
or the performance of such act may be completed on the next
succeeding Business Day, but shall be deemed to have been
completed as of the required date.
7.13 CORPORATE ACTION. Upon entry of the Confirmation
Order by the Clerk of the Bankruptcy Court, all actions contem-
plated by the Plan shall be authorized and approved in all
respects (subject to the provisions of the Plan), including,
without limitation, the following: (a) the adoption and filing
with the Secretary of State of the State of Oregon of the
Restated Articles of Incorporation, (b) the execution, delivery
and performance of the New Credit Agreement, (c) the execution,
delivery and performance of the New Subordinated Debenture
Indenture and the New Subordinated Debentures, (d) the execution,
delivery and performance of the New Investment Agreement, and
(e) the execution, delivery and performance of all documents and
agreements relating to any of the foregoing. On the Effective
Date, the appropriate officers of the Reorganized Debtor are
authorized and directed to execute and deliver the agreements,
documents and instruments contemplated by the Plan and the
Disclosure Statement in the name of and on behalf of the
Reorganized Debtor.
7.14 RETIREE BENEFITS. On and after the Effective
Date, to the extent required by section 1129(a)(13) of the
Bankruptcy Code, the Reorganized Debtor shall continue to pay all<PAGE>
<PAGE> 106
retiree benefits (if any), as that term is defined in section
1114 of the Bankruptcy Code, maintained or established by the
Debtor prior to the Effective Date, without prejudice to the
Reorganized Debtor's rights under applicable non-bankruptcy law
to modify, amend or terminate the foregoing arrangements.
7.15 TIMING OF DISTRIBUTIONS. Notwithstanding anything
to the contrary herein, (a) any distribution required by the Plan
to be made on the Effective Date in respect of a Claim shall be
made as soon as practicable after (but in any event within 15
days of) the later of (i) the Effective Date and (ii) the date on
which such Claim becomes Allowed and any other conditions to
distribution with respect to such Claim shall have been
satisfied, and (b) any distribution required by the Plan or any
instrument issued pursuant to the Plan to be made on a date
subsequent to the Effective Date shall be made on the later of
(i) such date and (ii) as soon as practicable after (but in any
event within 15 days of) the date on which the pertinent Claim
becomes Allowed and any other conditions to distribution with
respect to such Claim shall have been satisfied.
7.16 FINAL ORDER. Any requirement in the Plan for a
Final Order may be waived by the Debtor, with the consent of the
Institutional Investor and the Debenture Holders Committee, or,
in the event that no Debenture Holders Committee is appointed in
this Chapter 11 case, the Creditors' Committee, upon written <PAGE>
<PAGE> 107
notice to the Bankruptcy Court; provided, however, that nothing
contained herein shall prejudice the right of any party in
interest to seek a stay pending appeal with respect to such Final
Order.
7.17 BALLOT RECORD DATE; DISTRIBUTION RECORD DATE. The
Reorganized Debtor shall distribute, or cause to be distributed,
all distributions of property to be made pursuant to the Plan to
the record holders of Allowed Old Subordinated Debenture Claims
as of the Ballot Record Date, unless, prior to the Distribution
Record Date, the holder of any such Claim furnishes (or causes
its transferee to furnish) the Debtor, or its agent, with
sufficient evidence (in the Debtor's or its agent's sole and
absolute discretion) of the transfer of such Claim, in which
event the Reorganized Debtor shall distribute, or cause to be
distributed, all distributions of property to the holder of such
Claim as of the Distribution Record Date. As of the close of
business on the Distribution Record Date, the transfer ledgers
with respect to the Old Subordinated Debentures shall be closed
and the Debtor, the Reorganized Debtor and the indenture trustee
with respect to the Old Subordinated Debenture Indenture shall
have no obligation to recognize any transfer of the Old
Subordinated Debentures occurring thereafter.<PAGE>
<PAGE> 108
ARTICLE 8.
EXECUTORY CONTRACTS AND UNEXPIRED LEASES
8.1 GENERALLY. Effective on and as of the Effective
Date, all executory contracts and unexpired leases that exist
between the Debtor and any Entity are hereby specifically
assumed, except for any executory contracts and unexpired leases
that have been specifically rejected by the Debtor with the
approval of the Bankruptcy Court on or before the Effective Date
or in respect of which a motion for rejection has been Filed on
or before the Confirmation Date.
8.2 ASSUMPTION. Entry of the Confirmation Order by
the Clerk of the Bankruptcy Court shall constitute approval of
all executory contracts and unexpired leases to be assumed by the
Debtor in accordance with Section 8.1 hereof pursuant to section
365(a) of the Bankruptcy Code.
8.3 REJECTION. Rejection Claims must be Filed no
later than 20 days after the entry of a Final Order authorizing
such rejection. Any such Rejection Claim not Filed within such
time shall be forever barred from assertion against the Debtor,
the Reorganized Debtor and their property and estate. Each
Rejection Claim resulting from such rejection shall constitute a
Class 3 Claim if secured or a Class 7 Claim if unsecured.
8.4 OFFICERS' AND DIRECTORS' INDEMNIFICATION RIGHTS.
Notwithstanding any other provisions of the Plan, the obligations<PAGE>
<PAGE> 109
of the Debtor to indemnify its or its Affiliates' (if any)
directors, officers and employees as of the Petition Date against
any obligations, liabilities, costs or expenses pursuant to the
articles of incorporation or bylaws of the Debtor, applicable
state law or specific agreement, or any combination of the
foregoing, shall survive confirmation of the Plan, remain
unaffected thereby, and not be discharged, regardless of whether
indemnification is owed in connection with an event occurring
prior to, upon or subsequent to the commencement of the
Chapter 11 Case.
8.5 COMPENSATION AND BENEFIT PROGRAMS. All employee
compensation and benefit plans, policies and programs of the
Debtor applicable generally to its employees as in effect on the
Effective Date, including, without limitation, all savings plans,
retirement plans, health care plans, disability plans, severance
benefit plans, incentive plans, stock incentive plans, and life,
accidental death and dismemberment insurance plans, shall
continue in full force and effect, without prejudice to the
Reorganized Debtor's rights under applicable non-bankruptcy law
to modify, amend or terminate any of the foregoing arrangements.
ARTICLE 9.
CONDITIONS PRECEDENT
9.1 CONDITIONS TO EFFECTIVE DATE. The Plan shall not
become effective unless each of the following conditions shall<PAGE>
<PAGE> 110
have been satisfied or waived pursuant to Section 9.2 hereof:
(a) Each of the conditions set forth in subsections 9.1(b)
through 9.1(f) shall have been satisfied on or before September
30, 1995.
(b) The Confirmation Order shall have become a Final
Order.
(c) The New Subordinated Debenture Indenture and all
documents contemplated by such document to be executed simultane-
ously therewith shall have been executed by the respective
parties thereto and all of the conditions precedent to the
effectiveness of such documents and agreements (other than that
the Plan be effective) shall have been satisfied in full or duly
waived.
(d) The New Credit Agreement and all documents
contemplated by the New Credit Agreement to be executed
simultaneously therewith shall have been executed by the
respective parties thereto, and all of the conditions precedent
to the effectiveness of such documents and agreements (other than
that the Plan be effective) shall have been satisfied in full or
duly waived.
(e) The New Investment Agreement and all documents
contemplated by the New Investment Agreement to be executed
simultaneously therewith shall have been executed by the respec-
tive parties thereto, and all of the conditions precedent to the<PAGE>
<PAGE> 111
effectiveness of such documents and agreements (other than that
the Plan be effective) shall have been satisfied in full or duly
waived.
(f) All other actions required by Article 7 and
Section 12.1 hereof to occur on or before the Effective Date
shall have occurred.
9.2 WAIVER OF CONDITIONS. The Debtor, with the
consent of the Institutional Investor and the Debenture Holders
Committee, or, in the event that no Debenture Holders Committee
is appointed in this Chapter 11 Case, the Creditors' Committee,
may waive any of the conditions set forth in Section 9.1 hereof.
9.3 NOTICE TO BANKRUPTCY COURT. The Debtor shall
notify the Bankruptcy Court in writing promptly after the
Effective Date that the Plan shall have become effective.
ARTICLE 10.
MODIFICATION, REVOCATION OR WITHDRAWAL OF THE PLAN
10.1 MODIFICATION OF PLAN. The Debtor, with the
consent of the Institutional Investor and the Debenture Holders
Committee, or in the event that no Debenture Holders Committee is
appointed in this Chapter 11 Case, the Creditors' Committee may
alter, amend or modify the Plan pursuant to Section 1127 of the
Bankruptcy Code and Bankruptcy Rule 3019 at any time prior to the
time that the Bankruptcy Court has signed the Confirmation Order.
After such time and prior to the substantial consummation of the<PAGE>
<PAGE> 112
Plan, the Debtor may, so long as the treatment of holders of
Claims and Interests under the Plan is not adversely affected,
institute proceedings in Bankruptcy Court to remedy any defect or
omission or to reconcile any inconsistencies in the Plan, the
Disclosure Statement or the Confirmation Order and any other
matters as may be necessary to carry out the purposes and effects
of the Plan; provided, however prior notice of such proceedings
shall be served in accordance with Bankruptcy Rule 2002.
10.2 REVOCATION OR WITHDRAWAL OF PLAN.
(a) RIGHT TO REVOKE. The Debtor reserves the right to
revoke or withdraw the Plan at any time prior to the Effective
Date.
(b) EFFECT OF WITHDRAWAL OR REVOCATION. If the Debtor
revokes or withdraws the Plan prior to the Effective Date, then
the Plan shall be deemed null and void. In such event, nothing
contained herein shall be deemed to constitute a waiver or
release of any claims by or against the Debtor or any other
Entity or to prejudice in any manner the rights of the Debtor or
any Entity in any further proceedings involving the Debtor.
10.3 NONCONSENSUAL CONFIRMATION. The Debtor shall
request that the Bankruptcy Court confirm the Plan pursuant to
section 1129(b) of the Bankruptcy Code if the requirements of all
provisions of section 1129(a) of the Bankruptcy Code, except
subsection 1129(a)(8), are met.<PAGE>
<PAGE> 113
ARTICLE 11.
RETENTION OF JURISDICTION
11.1 JURISDICTION OF BANKRUPTCY COURT.
(a) Following the Effective Date, the Bankruptcy Court
will retain exclusive jurisdiction of the Chapter 11 Case for the
following purposes:
(i) To hear and determine any pending applications for
the rejection of executory contracts or unexpired leases,
and the allowance of Claims resulting therefrom.
(ii) To determine any adversary proceedings,
applications, contested matters and other litigated matters
pending on the Effective Date.
(iii) To ensure that distributions to holders of
Allowed Claims are accomplished as provided herein.
(iv) To hear and determine objections to or requests
for estimation of Claims, including any objections to the
classification of any Claim, and to allow, disallow and/or
estimate any Claim, in whole or in part.
(v) To enter and implement such orders as may be
appropriate in the event the Confirmation Order is for any
reason stayed, revoked, modified or vacated.
(vi) To issue any appropriate orders in aid of
execution of the Plan or to enforce the Confirmation Order<PAGE>
<PAGE> 114
and/or the discharge, or the effect of such discharge, provided
to the Debtor.
(vii) To hear and determine any applications to modify
the Plan, to cure any defect or omission or to reconcile any
inconsistency in the Plan or in any order of the Bankruptcy
Court, including, without limitation, the Confirmation
Order.
(viii) To hear and determine all applications for
compensation and reimbursement of expenses of professionals
or members of the Creditors' Committee (and if applicable,
the Debenture Holders Committee) under sections 330, 331,
503(b) and/or 1103 of the Bankruptcy Code.
(ix) To hear and determine disputes arising in
connection with the interpretation, implementation or
enforcement of the Plan; provided, however, that nothing
herein shall be construed to vest in the Bankruptcy Court
jurisdiction to hear and determine disputes arising in
connection with the interpretation, implementation or
enforcement of the instruments and securities being issued
under the Plan.
(x) To hear and determine other issues presented or
arising under the Plan.
(xi) To hear and determine any other matters related
hereto and not inconsistent with Chapter 11 of the<PAGE>
<PAGE> 115
Bankruptcy Code.
(xii) To enter a final decree closing the Chapter 11
Case.
(b) Following the Effective Date, the Bankruptcy Court
will retain non-exclusive jurisdiction of the Chapter 11 Case for
the following purposes:
(i) To recover all assets of the Debtor and property
of the estate, wherever located.
(ii) To hear and determine any motions or contested
matters involving taxes, tax refunds, tax attributes and tax
benefits and similar or related matters with respect to the
Debtor or its estate arising prior to the Effective Date or
relating to the period of administration of the Chapter 11
Case, including, without limitation, matters concerning
state, local and federal taxes in accordance with sections
346, 505 and 1146 of the Bankruptcy Code.
(iii) To hear any other matter not inconsistent with
the Bankruptcy Code.
11.2 FAILURE OF BANKRUPTCY COURT TO EXERCISE
JURISDICTION. If the Bankruptcy Court abstains from exercising
or declines to exercise jurisdiction over any matter arising
under, arising in or related to the Chapter 11 Case, including
with respect to the matters set forth above in Sections 11.01(a)
and (b) hereof, this Article shall not prohibit or limit the<PAGE>
<PAGE> 116
exercise of jurisdiction by any other court having competent
jurisdiction with respect to such subject matter.
ARTICLE 12.
MISCELLANEOUS PROVISIONS
12.1 PAYMENT OF STATUTORY FEES. All fees payable
pursuant to section 1930 of title 28 of the United States Code,
as determined by the Bankruptcy Court at the hearing pursuant to
section 1128 of the Bankruptcy Code, shall be paid on or before
the Effective Date.
12.2 DISCHARGE OF DEBTOR. Except as otherwise
expressly provided herein, the confirmation of the Plan shall,
provided that the Effective Date shall have occurred, discharge
all Claims, to the fullest extent authorized or provided for by
the Bankruptcy Code, including, without limitation, to the extent
authorized or provided for by sections 524 and 1141 thereof.
12.3 INJUNCTION. Except as otherwise expressly
provided herein, the entry of the Confirmation Order shall,
provided that the Effective Date shall have occurred, permanently
enjoin all Entities that have held, currently hold or may hold a
Claim, or other debt or liability that is discharged pursuant to
the Plan from taking any of the following actions in respect of
such discharged Claim, debt or liability: (a) commencing,
conducting or continuing in any manner, directly or indirectly,
any suit, action or other proceeding of any kind against the<PAGE>
<PAGE> 117
Debtor, the Reorganized Debtor or their property; (b) enforcing,
levying, attaching, collecting or otherwise recovering in any
manner or by any means, whether directly or indirectly, any
judgment, award, decree or order against the Debtor, the
Reorganized Debtor or their property; (c) creating, perfecting or
enforcing in any manner, directly or indirectly, any lien or
encumbrance of any kind against the Debtor, the Reorganized
Debtor or their property; (d) asserting any setoff, right of
subrogation or recoupment of any kind, directly or indirectly,
against any debt, liability or obligation due to the Debtor, the
Reorganized Debtor or their property; and (e) proceeding in any
manner in any place whatsoever that does not conform to or comply
with or is inconsistent with the provisions of the Plan.
12.4 REVESTING. Except as otherwise expressly provided
herein, on the Effective Date, all property and assets of the
estate of the Debtor shall revest in the Reorganized Debtor, free
and clear of all Claims, liens, encumbrances, charges, and other
interests of creditors arising on or before the Effective Date,
and the Reorganized Debtor may operate its business, from and
after the Effective Date, free of any restrictions imposed by the
Bankruptcy Code or the Bankruptcy Court.
12.5 EXCULPATION. Neither the Reorganized Debtor, the
Bank, the Institutional Investor, the Creditors' Committee, nor
the Debenture Holders Committee, nor any of their respective<PAGE>
<PAGE> 118
members, officers, directors, shareholders, employees, agents,
attorney's, accountants or other advisors, shall have or incur
any liability to any holder of a Claim or Interest for any act or
failure to act in connection with, or arising out of, the pursuit
of confirmation of the Plan, the consummation of the Plan or the
administration of the Plan or the property to be distributed
under the Plan, except for any act or failure to act that
constitutes willful misconduct or recklessness as determined
pursuant to a Final Order; and in all respects, such Entities
(a) shall be entitled to rely upon the advice of counsel with
respect to their duties and responsibilities under the Plan, and
shall be fully protected from liability in acting or in
refraining from action in accordance with such advice and
(b) shall be fully protected from liability with respect to any
act or failure to act that is approved or ratified by the
Bankruptcy Court.
12.6 RIGHTS OF ACTION. Any rights or causes of action
(including, without limitation, any and all avoidance actions)
accruing to the Debtor shall remain assets of the Reorganized
Debtor. The Reorganized Debtor may pursue such rights of action,
as appropriate, in accordance with what is in its best interests
and for its benefit.
12.7 CREDITORS' COMMITTEE. The appointment of each
official committee appointed in the Chapter 11 Case pursuant to<PAGE>
<PAGE> 119
Section 1102 of the Bankruptcy Code shall terminate on the
Effective Date.
12.8 GOVERNING LAW. Except to the extent the
Bankruptcy Code, the Bankruptcy Rules or other federal laws are
applicable, the laws of the State of Oregon shall govern the
construction and implementation of the Plan and all rights and
obligations arising under the Plan.
12.9 WITHHOLDING AND REPORTING REQUIREMENTS. In
connection with the Plan and all instruments issued in connection
therewith and distributions thereon, the Debtor and the
Reorganized Debtor shall comply with all withholding, reporting,
certification and information requirements imposed by any
federal, state, local or foreign taxing authority and all
distributions hereunder shall, to the extent applicable, be
subject to any such withholding, reporting, certification and
information requirements. Entities entitled to receive
distributions hereunder shall, as a condition to receiving such
distributions, provide such information and take such steps as
the Reorganized Debtor may reasonably require to ensure
compliance with such withholding and reporting requirements, and
to enable the Reorganized Debtor to obtain the certifications and
information as may be necessary or appropriate to satisfy the
provisions of any tax law.
12.10 TIME. Unless otherwise specified herein, in<PAGE>
<PAGE> 120
computing any period of time prescribed or allowed by the Plan,
the day of the act or event from which the designated period
begins to run shall not be included. The last day of the period
so computed shall be included, unless it is not a Business Day,
in which event the period runs until the end of the next
succeeding day which is a Business Day.
12.11 SECTION 1146 EXEMPTION. Pursuant to Section
1146(c) of the Bankruptcy Code, the issuance, transfer or
exchange of any security under the Plan, or the execution,
delivery or recording of an instrument of transfer pursuant to,
in implementation of or as contemplated by the Plan, or the
revesting, transfer or sale of any real property of the Debtor
pursuant to, in implementation of or as contemplated by the Plan
shall not be taxed under any state or local law imposing a stamp
tax, transfer tax or similar tax or fee. Consistent with the
foregoing, each recorder of deeds or similar official for any
county, city or governmental unit in which any instrument
hereunder is to be recorded shall, pursuant to the Confirmation
Order, be ordered and directed to accept such instrument, without
requiring the.payment of any documentary stamp tax, deed stamps,
stamp tax, transfer tax, intangible tax or similar tax.
12.12 SEVERABILITY. In the event that any provision
of the Plan is determined to be unenforceable, such determination
shall not limit or affect the enforceability and operative effect<PAGE>
<PAGE> 121
of any other provisions of the Plan. To the extent that any
provision of the Plan would, by its inclusion in the Plan,
prevent or preclude the Bankruptcy Court from entering the
Confirmation Order, the Bankruptcy Court, on the request of the
Debtor and with the consent of the Institutional Investor, may
modify or amend such provision, in whole or in part as necessary
to cure any defect or remove any impediment to the confirmation
of the Plan existing by reason of such provision; provided,
however, that such modification shall not be effected except in
compliance with Section 10.1 of the Plan.
12.13 BINDING EFFECT. The provisions of the Plan
shall bind all holders of Claims and Interests, whether or not
they have accepted the Plan.
12.14 PLAN CONTROLS. In the event and to the extent
that any provision of the Plan is inconsistent with the
provisions of the Disclosure Statement, or any other instrument
or agreement contemplated to be executed pursuant to the Plan,
the provisions of the Plan shall control and take precedence.
DATED this 9th day of May, 1995.
AMERICOLD CORPORATION
By ___________________________
Title: _______________________
TONKON, TORP, GALEN,
MARMADUKE & BOOTH
<PAGE>
<PAGE> 122
By /s/ Albert N. Kennedy
-----------------------------
Albert N. Kennedy; OSB No. 82142
Of Attorneys for Debtor
<PAGE>
<PAGE> 124 EXHIBIT 3.(ii)
RESTATED BYLAWS OF
AMERICOLD CORPORATION
ARTICLE I
SHAREHOLDERS: MEETINGS AND VOTING
Section 1. PLACE OF MEETINGS
Meetings of the shareholders of Americold Corporation
(the "Corporation") will be held at the principal office of the
Corporation, or any other place, either within or without the
state of Oregon, selected by the Board of Directors.
Section 2. ANNUAL MEETINGS
(a) The annual meeting of the shareholders will be
held on the fourth Tuesday in June of each year, if not a legal
holiday, and if a legal holiday then on the next succeeding
business day, at such time as may be prescribed by the Board of
Directors and specified in the notice of the meeting. At the
annual meeting, the shareholders will elect by vote a Board of
Directors, consider reports of the affairs of the Corporation and
transact such other business as may properly be brought before
the meeting. To facilitate the business of the Corporation, the
Board of Directors in its discretion may elect to hold the annual
meeting of shareholders at any other date in the month of June.
(b) If the annual meeting is not held within the
earlier of six months after the end of the Corporation's fiscal
year or 15 months after its last annual meeting, the circuit
court of the county where the Corporation's principal office is
located, or, if the principal office is not in Oregon, where the
registered office of the Corporation is or was last located, may
summarily order a meeting to be held upon the application of any
shareholder of the Corporation entitled to participate in an
annual meeting.
Section 3. SPECIAL MEETINGS
(a) The Corporation will hold a special meeting of
shareholders upon the call of the Chairman of the Board, the
President or any two or more directors, or if the holders of at
least 10 percent of all votes entitled to be cast on any issue
proposed to be considered at the proposed special meeting sign,
date and deliver to the Secretary of the Corporation one or more
written demands for the meeting describing the purpose or<PAGE>
<PAGE> 125
purposes for which it is to be held.
(b) The circuit court of the county where the Corpora-
tion's principal office is located, or, if the principal office
is not in Oregon, where the registered office of the Corporation
is or was last located, may summarily order a special meeting to
be held upon the application of a shareholder of the Corporation
who signed a valid demand for a special meeting if notice of the
special meeting was not given within 30 days after the date the
demand was delivered to the Corporation's Secretary or if the
special meeting was not held in accordance with the notice.
Section 4. NOTICE OF MEETINGS
(a) The Corporation will notify shareholders in
writing of the date, time and place of each annual and special
shareholders meeting not earlier than 60 days nor less than ten
days before the meeting date, Unless Oregon law or the Articles
of Incorporation require otherwise, the Corporation is required
to give notice only to shareholders entitled to vote at the
meeting. Such notice is effective when mailed if it is mailed
postage prepaid and is correctly addressed to the shareholder's
address shown in the Corporation's current record of
shareholders. Unless required by law or by the Articles of
Incorporation, notice of an annual meeting need not include a
description of the purpose or purposes for which the meeting is
called. However, notice of a special meeting will include a
description of the purpose or purposes for which the meeting is
called.
(b) If an annual or special shareholders meeting is
adjourned to a different date, time or place, notice need not be
given of the new date, time or place if the new date, time or
place is announced at the meeting before adjournment. However,
if a new record date for the adjourned meeting is fixed, or is
required by law to be fixed, notice of the adjourned meeting must
be given to persons who are shareholders as of the new record
date. A determination of shareholders entitled to notice of or
to vote at a shareholders meeting is effective for any adjourn-
ment of the meeting unless the Board of Directors fixes a new
record date, which it must do if the meeting is adjourned to a
date more than 120 days after the date fixed for the original
meeting.
(c) A shareholder's attendance at a meeting waives
objection to (i) lack of notice or defective notice of the
meeting, unless the shareholder at the beginning of the meeting
objects to holding the meeting or transacting business at the
meeting; and (ii) consideration of a particular matter at the<PAGE>
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meeting that is not within the purpose or purposes described in
the meeting notice, unless the shareholder objects to considering
the matter when it is presented.
Section 5. QUORUM AND VOTING REQUIREMENTS FOR VOTING GROUPS
(a) Shares entitled to vote as a separate voting group
may take action on a matter at a meeting only if a quorum of
those shares exists with respect to that matter. Unless
otherwise required by law, a majority of the votes entitled to be
cast on the matter by the voting group constitutes a quorum of
that voting group for action on that matter. Once a share is
represented for any purpose at a meeting, it is deemed present
for quorum purposes for the remainder of the meeting and for any
adjournment of that meeting unless a new record date is or must
be set for that adjourned meeting.
(b) In the absence of a quorum, a majority of those
present in person or represented by proxy may adjourn the meeting
from time to time until a quorum exists. Any business that might
have been transacted at the original meeting may be transacted at
the adjourned meeting if a quorum exists.
Section 6. VOTING RIGHTS
(a) The persons entitled to receive notice of and to
vote at any shareholders meeting will be determined from the
records of the Corporation on the close of business on the day
before the mailing of the notice or on such other date not more
than 70 nor less than 10 days before such meeting, as will be
fixed in advance by the Board of Directors.
(b) Except as otherwise provided in the Articles of
Incorporation or by law, each outstanding share, regardless of
class, is entitled to one vote on each matter voted on at a
shareholders meeting. Only shares are entitled to vote.
(c) Unless otherwise provided in the Articles of
Incorporation or by law, if a quorum exists, action on a matter,
other than the election of directors, by a voting group is
approved if the votes cast within the voting group favoring the
action exceed the votes cast within the voting group opposing the
action.
(d) Unless otherwise provided in the Articles of
Incorporation, directors are elected by a plurality of the votes
cast by holders of the shares entitled to vote in the election at
a meeting at which a quorum is present.
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Section 7. VOTING OF SHARES BY CERTAIN HOLDERS
(a) If the name signed on a vote, consent, waiver or
proxy appointment corresponds to the name of a shareholder, the
Corporation, if acting in good faith, is entitled to accept the
vote, consent, waiver or proxy appointment and give it effect as
the act of the shareholder. If the name signed on a vote,
consent, waiver or proxy appointment does not correspond to the
name of its shareholder, the Corporation, if acting in good<PAGE>
<PAGE> 128
faith, is nevertheless entitled to accept the vote, consent,
waiver or proxy appointment and give it effect as the act of the
shareholder if:
(i) The shareholder is an entity and the name
signed purports to be that of an officer or agent of the
entity;
(ii) The name signed purports to be that of an
administrator, executor, guardian or conservator
representing the shareholder and, if the Corporation
requests, evidence of fiduciary status acceptable to the
Corporation has been presented with respect to the vote,
consent, waiver or proxy appointment;
(iii) The name signed purports to be that of a
receiver or trustee in bankruptcy of the shareholder and, if
the Corporation requests, evidence of this status acceptable
to the Corporation has been presented with respect to the
vote, consent, waiver or proxy appointment;
(iv) The name signed purports to be that of a
pledgee, beneficial owner or attorney-in-fact of the
shareholder and, if the Corporation requests, evidence
acceptable to the Corporation of the signatory's authority
to sign for the shareholder has been presented with respect
to the vote, consent, waiver or proxy appointment; or
(v) Two or more persons are the shareholder as
co-tenants or fiduciaries and the name signed purports to be
the name of at least one of the co-owners and the person
signing appears to be acting on behalf of all co-owners.
(b) Shares of the Corporation are not entitled to be
voted if (i) they are owned, directly or indirectly, by another
domestic or foreign corporation, and (ii) the Corporation owns,
directly or indirectly, a majority of the shares entitled to be
voted for directors of such other corporation. This paragraph
does not limit the power of a corporation to vote any shares,
including its own shares, held by it in a fiduciary capacity.
(c) Redeemable shares are not entitled to be voted
after notice of redemption is mailed to the holders and a sum
sufficient to redeem the shares has been deposited with a bank,
trust company or other financial institution under an irrevocable
obligation to pay the holders the redemption price on surrender
of the shares.
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Section 8. PROXIES
A shareholder may vote shares either in person or by
proxy. A shareholder may appoint a proxy to vote or otherwise
act for the shareholder by signing an appointment form, either
personally or by the shareholder's attorney-in-fact. An
appointment of a proxy is effective when received by the Secre-
tary or other officer or agent of the Corporation authorized to
tabulate votes. An appointment is valid for 11 months unless a
longer period is expressly provided in the appointment form. An
appointment of a proxy is revocable by the shareholder unless the
appointment form conspicuously states that it is irrevocable and
the appointment is coupled with an interest.
Section 9. SHAREHOLDER LISTS
(a) After fixing a record date for a meeting, the
Corporation will prepare an alphabetical list of the names of all
of its shareholders who are entitled to notice of the meeting.
The list must be arranged by voting group, and within each voting
group, by class or series of shares and show the address of and
the number of shares held by each shareholder.
(b) The shareholder list must be available for
inspection by any shareholder, beginning two business days after
notice of the meeting for which the list was prepared is given
and continuing through the meeting. Such list will be kept on
file at the Corporation's principal office or at a place
identified in the meeting notice in the city where the meeting
will be held. A shareholder, or the shareholder's agent or
attorney, is entitled on written demand to inspect and, subject
to the requirements of law, to copy the list during regular
business hours and at the shareholder's expense during the period
it is available for inspection.
(c) The Corporation will make the shareholder list
available at the meeting, and any shareholder, or the
shareholder's agent or attorney, is entitled to inspect the list
at any time during the meeting or any adjournment.
(d) Refusal or failure to prepare or make available
the shareholder list does not affect the validity of action
taken at the meeting.
ARTICLE II
DIRECTORS: MANAGEMENT
Section 1. POWERS
<PAGE>
<PAGE> 130
The Corporation will have a Board of Directors. All
corporate powers will be exercised by or under the authority of,
and the business and affairs of the Corporation managed under the
direction of, the Board of Directors, subject to any limitation
set forth in the Articles of Incorporation.
Section 2. NUMBER AND QUALIFICATIONS
The Board of Directors will consist of 1 to 12 members,
the exact number to be determined from time to time by the Board
of Directors. A decrease in the number of directors does not
shorten an incumbent director's term. Directors need not be
residents of the state of Oregon or shareholders of the
Corporation, unless required by the Articles of Incorporation.
Section 3. ELECTION AND TENURE OF OFFICE
The directors will be elected by ballot at the annual
meeting of the shareholders. The terms of all directors expire
at the next annual shareholders meeting following their election.
The term of a director elected to fill a vacancy expires at the
next shareholders meeting at which directors are elected.
Despite the expiration of a director's term, the director
continues to serve until the director's successor is elected and
qualifies or until there is a decrease in the number of
directors. Subject to paragraph (c) of Section 4 of Article II,
a director's term of office will begin immediately after
election.
Section 4. VACANCIES
(a) A vacancy in the Board of Directors will exist
upon the death, resignation or removal of any director or upon an
increase in the number of directors.
(b) Unless the Articles of Incorporation provide
otherwise, if a vacancy occurs on the Board of Directors:
(i) The shareholders may fill the vacancy;
(ii) The Board of Directors may fill the vacancy;
or
(iii) If the directors remaining in office
constitute fewer than a quorum of the Board, they may fill
the vacancy by the affirmative vote of a majority of all the
directors remaining in office.
<PAGE>
<PAGE> 131
(c) A vacancy that will occur at a specific later
date, by reason of a resignation effective at the later date or
otherwise, may be filled before the vacancy occurs, but the new
director may not take office until the vacancy occurs.
Section 5. RESIGNATION OF DIRECTORS
A director may resign at any time by delivering written
notice to the Board of Directors, its chairperson or the Corpo-
ration. Unless the notice specifies a later effective date, a
resignation is effective at the earliest of the following:
(a) when received; (b) five days after its deposit in the United
States mail, as evidenced by the postmark, if mailed postage
prepaid and correctly addressed; or (c) on the date shown on the
return receipt, if sent by registered or certified mail, return
receipt requested and the receipt is signed by or on behalf of
the addressee. Once delivered, a notice of resignation is irre-
vocable unless revocation is permitted by the Board of Directors.
Section 6. REMOVAL OF DIRECTORS
The shareholders may remove one or more directors with
or without cause unless the Articles of Incorporation provide
that the directors may be removed only for cause. A director may
be removed by the shareholders only at a meeting called for the
purpose of removing the director and the meeting notice must
state that the purpose, or one of the purposes, of the meeting is
removal of the director.
Section 7. MEETINGS
(a) The Board of Directors may hold regular or special
meetings in or out of the state of Oregon.
(b) Annual meetings of the Board of Directors will be
held without notice immediately following the adjournment of the
annual meetings of the shareholders.
(c) Unless the Articles of Incorporation provide
otherwise, regular meetings of the Board of Directors may be held
without notice of the date, time, place or purpose of the
meeting. The Board of Directors may fix, by resolution, the time
and place for the holding of regular meetings.
(d) Special meetings of the Board of Directors for any
purpose or purposes may be called at any time by the President or
one-third of the directors. The person or persons who call a
special meeting of the Board of Directors may fix the time and
place of the special meeting.<PAGE>
<PAGE> 132
Section 8. NOTICE OF SPECIAL MEETINGS
(a) Unless the Articles of Incorporation provide for a
longer or shorter period, special meetings of the Board of
Directors must be preceded by at least two days' notice of the
date, time and place of the meeting. The notice need not
describe the purpose of the special meeting unless required by
the Articles of Incorporation. The notice will be given orally,
in person or by telephone, or delivered in writing personally, by
mail or by telegram. If in writing, such notice is effective at
the earliest of the following: (a) when received; (b) five days
after its deposit in the United States mail, as evidenced by the
postmark, if it is mailed postage prepaid and is correctly
addressed to the director's address shown in the Corporation's
records; or (c) on the date shown on the return receipt, if sent
by registered or certified mail, return receipt requested, and
the receipt is signed by or on behalf of the addressee. If given
orally, such notice is effective when communicated.
(b) A director's attendance at or participation in a
meeting waives any required notice to the director of the meeting
unless the director at the beginning of the meeting, or promptly
upon the director's arrival, objects to holding the meeting or
transacting business at the meeting and does not thereafter vote
for or assent to action taken at the meeting.
(c) Notice of the time and place of holding an
adjourned meeting need not be given if such time and place are
fixed at the meeting adjourned.
Section 9. QUORUM AND VOTE
(a) Unless the Articles of Incorporation provide
otherwise, a majority of the directors in office will constitute
a quorum for the transaction of business. A majority of the
directors, in the absence of a quorum, may adjourn from time to
time but may not transact any business.
(b) If a quorum is present when a vote is taken, the
affirmative vote of a majority of directors present is the act of
the Board of Directors unless the Articles of Incorporation
require the vote of a greater number of directors.
(c) A director of the Corporation who is present at a
meeting of the Board of Directors, or is present at a meeting of
a committee of the Board of Directors, when corporate action is
taken, is deemed to have assented to the action taken unless (i)
the director objects at the beginning of the meeting, or promptly
upon the director's arrival, to holding the meeting or<PAGE>
<PAGE> 133
transacting business at the meeting, (ii) the director's dissent
or abstention from the action taken is entered in the minutes of
the meeting, or (iii) the director delivers written notice of
dissent or abstention to the presiding officer of the meeting
before its adjournment or to the Corporation immediately after
adjournment of the meeting. The right of dissent or abstention
is not available to a director who votes in favor of the action
taken.
Section 10. COMPENSATION
The Board of Directors may, by resolution, provide that
the directors be paid their expenses, if any, of attendance at
each meeting of the Board of Directors, and provide that
directors be paid a fixed sum for attendance at each meeting of
the Board of Directors or a stated salary as director. No such
payment will preclude any director from serving the Corporation
in any other capacity and receiving compensation for that
service.
ARTICLE III
COMMITTEES
(a) Subject to law, the provisions of the Articles of
Incorporation and these Bylaws, the Board of Directors may
appoint an executive committee and such other committees as may
be necessary from time to time, consisting of such number of its
members and having such powers as it may designate. Each such
committee will have two or more members, who serve at the
pleasure of the Board of Directors.
(b) All actions of a committee will be reflected in
minutes to be kept of such meetings and reported to the Board of
Directors at the next succeeding meeting thereof. The provisions
of Article II of these Bylaws governing meetings, notice and
waiver of notice, and quorum and voting requirements of the Board
of Directors apply to committees and their members as well.
(c) An executive committee may be appointed by the
Board of Directors pursuant to the foregoing paragraphs. When
appointed, the executive committee will have the power to
exercise all authority of the Board of Directors except as may be
expressly limited by law.
(d) An Audit Committee of the Corporation shall be
composed of at least three members of the Board of Directors.
All action of the Audit Committee shall be reflected in minutes
to be kept of such meetings and reported to the Board of<PAGE>
<PAGE> 134
Directors at its next succeeding meeting. The Audit Committee
shall: (i) annually recommend to the Board of Directors, for
appointment by the Board, a firm of independent public
accountants as auditors of the books, records and accounts of the
Corporation; (ii) review the scope of audits made by the
independent public accountants; (iii) receive and review the
audit reports submitted by the independent public accountants
and take such action regarding such reports as the Audit
Committee may deem appropriate; (iv) determine the duties and
responsibilities of any internal auditing staff, review internal
audit reports; and (v) take such action in connection with
financial and accounting matters as the Audit Committee may deem
appropriate to assure that the interests of the Corporation and
its shareholders are adequately protected.
ARTICLE IV
OFFICERS
Section 1. DESIGNATION; ELECTION; QUALIFICATION
(a) The officers of the Corporation will be a Presi-
dent, a Secretary and such other officers and assistant officers
as the Board of Directors will from time to time appoint, none of
whom need be members of the Board of Directors. The officers
will be elected by, and hold office at the pleasure of, the Board
of Directors. A duly appointed officer may appoint one or more
officers or assistant officers if such appointment is authorized
by the Board of Directors. The same individual may
simultaneously hold more than one office in the Corporation.
(b) A vacancy in any office because of death, resig-
nation, removal or any other cause will be filled in the manner
prescribed in these Bylaws for regular appointments to such
office.
Section 2. COMPENSATION AND TERM OF OFFICE
(a) The compensation and term of office of all the
officers of the Corporation will be fixed by the Board of
Directors.
(b) The Board of Directors may remove any officer at
any time, either with or without cause.
(c) Any officer may resign at any time by giving
written notice to the Board of Directors, the President or the
Secretary of the Corporation. Unless the notice specifies a
later effective date, a resignation is effective at the earliest<PAGE>
<PAGE> 135
of the following: (a) when received; (b) five days after its
deposit in the United States mail, as evidenced by the postmark,
if mailed postage prepaid and correctly addressed; or (c) on the
date shown on the return receipt, if sent by registered or
certified mail, return receipt requested and the receipt is
signed by or on behalf of the addressee. Once delivered, a
notice of resignation is irrevocable unless revocation is
permitted by the Board of Directors. If a resignation is made
effective at a later date and the Corporation accepts the future
effective date, the Board of Directors may fill the pending
vacancy before the effective date, if the Board of Directors
provides that the successor will not take office until the
effective date.
(d) This section will not affect the rights of the
Corporation or any officer under any express contract of employ-
ment.
Section 3. CHAIRMAN OF THE BOARD
If the Corporation elects a Chairman of the Board, he
or she will preside at all meetings of the Board of Directors and
at meetings of the shareholders and will be the Chief Executive
Officer of the Corporation. Subject to the control of the Board
of Directors, the Chairman of the Board shall have general
supervision, direction and control of the business and affairs of
the Corporation. The Chairman of the Board will have authority
to execute on behalf of the Corporation all contracts, deeds,
agreements, stock certificates and other instruments. The
Chairman of the Board will be ex officio a member of all the
standing committees (including the executive committee, if any),
will have the general powers and duties of management usually
vested in the Chief Executive Officer of a corporation and will
have such other powers and duties as may be prescribed by the
Board of Directors or these Bylaws.
Section 4. PRESIDENT
The President will be the Chief Operating Officer of
the Corporation, and will have such duties of general
supervision, direction and control of the business and affairs of
the Corporation as are authorized by the Board of Directors and
the Chairman of the Board. In the absence of the Chairman of the
Board, the President will perform the duties and responsibilities
of the Chairman of the Board. The President will be ex officio a
member of all the standing committees (including the executive
committee, if any), will have the general powers and duties of
management usually vested in the office of Chief Operating
Officer of a corporation and will have such other powers and<PAGE>
<PAGE> 136
duties as may be prescribed by the Board of Directors or these
Bylaws.
Section 5. VICE PRESIDENTS
The Vice Presidents, if any, will perform such duties
as the Board of Directors prescribes. In the absence or
disability of the President, the President's duties and powers
will be performed and exercised by a senior Vice President, as
designated by the Board of Directors.
Section 6. SECRETARY
(a) The Secretary will keep or cause to be kept at the
principal office, or such other place as the Board of Direc-
tors may order, a book of minutes of all meetings of directors
and shareholders showing the time and place of the meeting,
whether it was regular or special and, if special, how
authorized, the notice given, the names of those present at
directors meetings, the number of shares present or represented
at shareholders meetings and the proceedings thereof.
(b) The Secretary will keep or cause to be kept, at
the principal office or at the office of the Corporation's
transfer agent, a share register, or a duplicate share register,
showing the names of the shareholders and their addresses, the
number and classes of shares held by each, the number and date of
certificates issued for such shares and the number and date of
cancellation of certificates surrendered for cancellation.
(c) The Secretary will give or cause to be given such
notice of the meetings of the shareholders and of the Board of
Directors as is required by these Bylaws. The Secretary will
keep the seal of the Corporation, if any, and affix it to all
documents requiring a seal, and will have such other powers and
perform such other duties as may be prescribed by the Board of
Directors or these Bylaws.
Section 7. TREASURER
The Treasurer, if any, will be responsible for the
funds of the Corporation, and pay them out only on the checks of
the Corporation signed in the manner authorized by the Board of
Directors.
Section 8. ASSISTANTS
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<PAGE> 137
The Board of Directors may appoint or authorize the
appointment of assistants to the Secretary or Treasurer, or both.
Such assistants may exercise the powers of the Secretary or
Treasurer, as the case may be, and will perform such duties as
are prescribed by the Board of Directors.
ARTICLE V
CORPORATE RECORDS AND REPORTS - INSPECTION
Section 1. RECORDS
The Corporation will maintain all records required by
law. All such records and accounts will be kept at its principal
office, registered office or at any other place designated by the
President of the Corporation, or as otherwise provided by law.
Section 2. INSPECTION OF RECORDS
All records of the Corporation will be open to
inspection by the shareholders or the shareholders' agents or
attorneys in the manner and to the extent required by law.
Section 3. CHECKS, DRAFTS, ETC.
All checks, drafts or other orders for payment of
money, notes or other evidences of indebtedness, issued in the
name of or payable to the Corporation, will be signed or endorsed
by such person or persons and in such manner as will be deter-
mined from time to time by resolution of the Board of Directors.
Section 4. EXECUTION OF DOCUMENTS
The Board of Directors may, except as otherwise pro-
vided in these Bylaws, authorize any officer or agent of the Cor-
poration to enter into any contract or execute any instrument in
the name of and on behalf of the Corporation. Such authority may
be general or confined to specific instances. Unless so autho-
rized by the Board of Directors, no officer, agent or employee of
the Corporation will have any power or authority to bind the
Corporation by any contract or engagement, or to pledge its
credit, or to render it liable for any purpose or for any amount.
ARTICLE VI
CERTIFICATES AND TRANSFER OF SHARES
Section 1. CERTIFICATES FOR SHARES<PAGE>
<PAGE> 138
(a) Certificates for shares will be in such form as
the Board of Directors may designate, will designate the name of
the Corporation and the state law under which the Corporation is
organized, will state the name of the person to whom the shares
represented by the certificate are issued, and will state the
number and class of shares and the designation of the series, if
any, the certificate represents. If the Corporation is autho-
rized to issue different classes of shares or different series
within a class, the designations, relative rights, preferences
and limitations applicable to each class, the variations and
rights, preferences and limitations determined for each series
and the authority of the Board of Directors to determine
variations for future series will be summarized on the front or
back of each certificate, or each certificate may state
conspicuously on its front or back that the Corporation will
furnish shareholders with this information on request in writing
and without charge.
(b) Each certificate for shares must be signed, either
manually or in facsimile, by the President or a Vice President
and the Secretary or an Assistant Secretary of the Corporation.
The certificates may bear the corporate seal or its facsimile.
(c) If any officer who has signed a share certificate,
either manually or in facsimile, no longer holds office when the
certificate is issued, the certificate is nevertheless valid.
(d) The Corporation will not issue certificates for
fractional shares.
Section 2. TRANSFER ON THE BOOKS
Upon surrender to the Corporation of a certificate for
shares duly endorsed or accompanied by proper evidence of succes-
sion, assignment or authority to transfer, the Corporation will
issue a new certificate to the person entitled thereto, cancel
the old certificate and record the transaction upon its books.
Section 3. LOST, STOLEN OR DESTROYED CERTIFICATES
In the event a certificate is represented to be lost,
stolen or destroyed, a new certificate will be issued in place
thereof upon such proof of the loss, theft or destruction and
upon the giving of such bond or other security as may be required
by the Board of Directors.
Section 4. TRANSFER AGENTS AND REGISTRARS<PAGE>
<PAGE> 139
The Board of Directors may from time to time appoint
one or more transfer agents and one or more registrars for the
shares of the Corporation who will have such powers and duties as
the Board of Directors will specify.
Section 5. CLOSING STOCK TRANSFER BOOKS
The Board of Directors may close the transfer books for
a period not exceeding 70 days nor less than 10 days preceding
any annual or special meeting of the shareholders or the day
appointed for the payment of a dividend.
ARTICLE VII
GENERAL PROVISIONS
Section 1. SEAL
If the Corporation elects to have a corporate seal,
such corporate seal will be circular in form and will have
inscribed thereon the name of the Corporation and the state of
its incorporation.
Section 2. AMENDMENT OF BYLAWS
(a) Except as otherwise provided by law or by the
Articles of Incorporation, the Board of Directors may amend or
repeal these Bylaws unless:
(i) The Articles of Incorporation or Oregon law
reserve this power exclusively to the shareholders in whole
or in part; or
(ii) The shareholders in amending or repealing a
particular Bylaw provide expressly that the Board of
Directors may not amend or repeal that Bylaw.
(b) The Corporation's shareholders may amend or repeal
these Bylaws even though these Bylaws may also be amended or
repealed by the Board of Directors.
(c) Whenever an amendment or new Bylaw is adopted, it
will be copied in the minute book with the original Bylaws in the
appropriate place. If any Bylaw is repealed, the fact of repeal
and the date on which the repeal occurred will be stated in such
book and place.
Section 3. WAIVER OF NOTICE
(a) A shareholder may at any time waive any notice<PAGE>
<PAGE> 140
required by law, the Articles of Incorporation or these Bylaws.
Except as otherwise provided in paragraph (c) of Section 4 of
Article I of these Bylaws, the waiver must be in writing, be
signed by the shareholder entitled to the notice, and be
delivered to the Corporation for inclusion in the minutes or
filing with the corporate records.
(b) A director may at any time waive any notice
required by law, the Articles of Incorporation or these Bylaws.
Except as otherwise provided in paragraph (b) of Section 8 of
Article II of these Bylaws, the waiver must be in writing, must
be signed by the director entitled to the notice, must specify
the meeting for which notice is waived and must be filed with the
minutes or appropriate records.
Section 4. ACTION WITHOUT A MEETING
(a) Action required or permitted by law to be taken at
a shareholders meeting may be taken without a meeting if the
action is taken by all the shareholders entitled to vote on the
action. The action must be evidenced by one or more written
consents describing the action taken, signed by all the share-
holders entitled to vote on the action and delivered to the
Corporation for inclusion in the minutes or filing with the
corporate records. Action taken under this Section 4 is effec-
tive when the last shareholder signs the consent, unless the
consent specifies an earlier or later effective date. If not
otherwise determined by law, the record date for determining
shareholders entitled to take action without a meeting is the
date the first shareholder signs the consent. A consent signed
under this Section 4 has the effect of a meeting vote and may be
described as such in any document.
(b) Unless the Articles of Incorporation or Bylaws
provide otherwise, action required or permitted by law to be
taken at a meeting of the Board of Directors, or at a meeting of
a committee of the Board of Directors, may be taken without a
meeting if the action is taken by all members of the Board. The
action must be evidenced by one or more written consents
describing the action taken, signed by each director and included
in the minutes or filed with the corporate records reflecting the
action taken. Action taken under this section is effective when
the last director signs the consent, unless the consent specifies
an earlier or later effective date. A consent signed under this
section has the effect of a meeting vote and may be described as
such in any document.
Section 5. TELEPHONIC MEETINGS
Unless the Articles of Incorporation provide otherwise,<PAGE>
<PAGE> 141
the Board of Directors may permit any or all directors to
participate in a regular or special meeting by, or conduct the
meeting through, use of any means of communication by which all
directors participating may simultaneously hear each other during
the meeting. A director participating in a meeting by this means
is deemed to be present in person at the meeting.
ARTICLE VIII
INDEMNIFICATION
(a) The Corporation shall indemnify to the fullest
extent permitted by law, any person who is made, or threatened to
be made, a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative,
investigative, or otherwise (including any action, suit or
proceeding by or in the right of the Corporation) by reason of
the fact that:
(i) the person is or was a director or officer of
the Corporation or any of its subsidiaries;
(ii) while serving as a director or officer of the
Corporation or any of its subsidiaries, the person is or was
also serving as a fiduciary within the meaning of the
Employee Retirement Income Security Act of 1974 with respect
to any employee benefit plan of the Corporation or any of
its subsidiaries; or
(iii) while serving as a director or officer of
the Corporation or any of its subsidiaries, the person is or
was also serving, at the request of the Corporation or any
of its subsidiaries, as a director, officer, employee or
agent, or as a fiduciary of an employee benefit plan, of
another corporation, partnership, joint venture, trust or
other enterprise.
(b) The expenses incurred by a director or officer in
connection with any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative,
investigative, or otherwise, which the director or officer is
made or threatened to be made a party to or witness in, or is
otherwise involved in, will be paid by the Corporation in advance
at the written request of the director or officer, if the
director or officer:
(i) furnishes the Corporation a written
affirmation of his or her good faith belief that he or she is
entitled to be indemnified by the Corporation; and<PAGE>
<PAGE> 142
(ii) furnishes the Corporation a written under-
taking to repay such advance to the extent that is ultimately
determined by a court that he or she is not entitled to be
indemnified by the Corporation. Such advances will be made
without regard to the person's ability to repay such expenses and
without regard to the person's ultimate entitlement to
indemnification under this Article or otherwise.
The rights of indemnification and advancement of
expenses provided in this article will be in addition to any
rights to which any such person may otherwise be entitled under
any articles of incorporation, bylaw, agreement, statute, policy
of insurance, vote of shareholders or Board of Directors, or
otherwise, which exists at or subsequent to the time such person
incurs or becomes subject to such liability and expense.
(c) The Corporation shall have power to indemnify its
employees and other agents to the fullest extent permitted by
law.
ARTICLE IX
TRANSACTIONS BETWEEN CORPORATION AND INTERESTED DIRECTORS
(a) No transaction will be voidable by the Corporation
solely because of a director's interest in the transaction if any
one of the following is true:
(i) The material facts of the transaction and the
director's interest were disclosed or known to the Board of
Directors or a committee of the Board of Directors, and the
Board of Directors or committee authorized, approved or
ratified the transaction;
(ii) The material facts of the transaction and the
director's interest were disclosed or known to the
shareholders entitled to vote and the shareholders
authorized, approved or ratified the transaction; or
(iii) The transaction was fair to the Corporation.
(b) For purposes of this Article IX, a director of the
Corporation has an indirect interest in a transaction if:
(i) Another entity in which the director has a
material financial interest or in which the director is a
general partner is a party to the transaction; or
(ii) Another entity of which the director is a
director, officer or trustee is a party to the transaction<PAGE>
<PAGE> 143
and the transaction is or should be considered by the Board of
Directors.
(c) For purposes of paragraph (a)(i) this Article IX,
a conflict of interest transaction is authorized, approved or
ratified if it receives the affirmative vote of a majority of the
directors on the Board of Directors, or on the committee, who
have no direct or indirect interest in the transaction. A
transaction may not be authorized, approved or ratified under
this Article IX by a single director. If a majority of the
directors who have no direct or indirect interest in the trans-
action vote to authorize, approve or ratify the transaction, a
quorum is present for the purpose of taking action under this
Article IX. The presence of, or a vote cast by, a director with
a direct or indirect interest in the transaction does not affect
the validity of any action taken under paragraph (a)(1) of this
Article IX if the transaction is otherwise authorized, approved
or ratified as provided in paragraph (a) of this Article IX,
(d) For purposes of paragraph (a)(ii) of this Article
IX, a conflict of interest transaction is authorized, approved or
ratified if it receives the vote of a majority of the shares
entitled to be counted under this Article IX, voting as a single
voting group. Shares owned by or voted under the control of a
director who has a direct or indirect interest in the transac-
tion, and shares owned by or voted under the control of an entity
described in paragraph (b)(i) of this Article IX may be counted
in a vote of shareholders to determine whether to authorize,
approve or ratify a conflict of interest transaction under
paragraph (a)(ii) of this Article IX. A majority of the shares,
whether or not present, that are entitled to be counted in a vote
on the transaction under this Article IX constitutes a quorum for
the purpose of taking action under this Article IX.
ARTICLE X
LIMITATION OF DIRECTOR LIABILITY
To the fullest extent permitted by law, no director of
the Corporation shall be personally liable to the Corporation or
its shareholders for monetary damages for conduct as a director.
No amendment or repeal of this Article X, nor the adoption of any
provision of these Restated Bylaws inconsistent with this
Article X, nor a change in the law, will adversely affect any
right or protection of a director, which right or protection is
based upon this Article X and arises from conduct that occurred
prior to the time of such amendment, repeal, adoption or change.
No change in the law shall reduce or eliminate the rights and<PAGE>
<PAGE> 144
protections applicable immediately after this provision shall
become effective unless the change in the law shall specifically
require such reduction or elimination. If the Oregon Business
Corporation Act is amended, after this Article X becomes
effective, to authorize corporate action further eliminating or
limiting the personal liability of directors of the Corporation,
then the liability of directors of the Corporation shall be
eliminated or limited to the fullest extent permitted by the
Oregon Business Corporation Act, as so amended.
<PAGE>
<PAGE> 145
(Exhibit 11)
AMERICOLD CORPORATION
STATEMENT REGARDING COMPUTATION OF
PER SHARE EARNINGS
(In thousands, except per share data)
<TABLE>
<CAPTION>
Year-ended last day of February
1993 1994 1995
---------- ---------- ----------
<S> <C> <C> <C>
Net income (loss) $ (8,150) $(77,121) $ 5,564
Less: total accrued preferred dividend
(43.860 shares x 13.25% x 8/12 yr) (387) - (60)
(38.389 shares x 14.25% x 4/12 yr) (183) - -
(49.672 shares x 11.50% x 8/12 yr) - (381) -
(43.860 shares x 13.25% x 4/12 yr) - (194) -
(49.672 shares x 11.50% x 4/12 yr) - - (190)
(55.384 shares x 13.50% x 7/12 yr) - - (436)
(52.936 shares x 13.50% x 1/12 yr) - (183) (60)
--------- --------- ---------
Net income (loss) for per share calculation $ (8,720) $(77,696) $ 4,878
========= ========= =========
Weighted average number of shares outstanding 4,839 4,855 4,864
========= ========= =========
Net income (loss) per share $ (1.80) $ (16.00) $ 1.00
========= ========= =========
</TABLE>
<PAGE>
<PAGE> 146
(Exhibit 21)
AMERICOLD CORPORATION
List of Subsidiaries
Names
State of Under Which
Name Incorporation Does Business
- ---- ------------- -------------
Americold Services Delaware Americold Services
Corporation Corporation
<PAGE>
<PAGE> 147
(Exhibit 23)
KPMG Peat Marwick LLP
Suite 2000
1211 South West Fifth Avenue
Portland, OR 97204
Consent of Independent Auditors
-------------------------------
The Board of Directors
Americold Corporation:
We consent to incorporation by reference in the Registration
Statement (No. 33-22556) on Form S-8 of Americold Corporation of
our report dated May 12, 1995 relating to the consolidated
balance sheets of Americold Corporation as of the last day of
February 1995 and 1994, and the related consolidated statements
of operations, stockholders' deficit, and cash flows and related
schedules for each of the years in the three-year period ended
the last day of February 1995, which report appears in the
February 28, 1995 annual report on Form 10-K of Americold
Corporation. As discussed in our report, the Company changed its
method of accounting for income taxes and postretirement benefits
other than pensions.
Our report dated May 12, 1995 contains an explanatory paragraph
that states that the Company's available cash and cash flow from
operating activities will not be sufficient to allow the Company
to meet its current debt service obligations and remain in
compliance with its current debt agreement covenants, which raise
substantial doubt about its ability to continue as a going
concern. As discussed in our report, the Company did not make a
scheduled debt payment on May 1, 1995 and filed a pre-packaged
petition under Chapter 11 of the United States Bankruptcy Code on
May 9, 1995. The consolidated financial statements and financial
statement schedule do not include any adjustments that might
result from the outcome of this uncertainty.
/s/ KPMG Peat Marwick
Portland, Oregon
May 26, 1995
Member Firm of Klynveld Peat Marwick Goerdeler
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM AMERICOLD CORPORATION'S FINANCIAL STATEMENTS
CONTAINED IN ITS ANNUAL REPORT ON FORM 10-K FOR THE PERIOD
ENDING FEBRUARY 28, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS
</LEGEND>
<MULTIPLIER> 1,000
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> FEB-28-1995
<PERIOD-END> FEB-28-1995
<CASH> 33,163<F1>
<SECURITIES> 0
<RECEIVABLES> 20,510<F2>
<ALLOWANCES> 0
<INVENTORY> 313
<CURRENT-ASSETS> 61,992
<PP&E> 524,054
<DEPRECIATION> 156,806
<TOTAL-ASSETS> 544,595
<CURRENT-LIABILITIES> 76,910
<BONDS> 442,912
<COMMON> 49<F3>
5,789<F4>
0
<OTHER-SE> (97,796)<F3>
<TOTAL-LIABILITY-AND-EQUITY> 544,595
<SALES> 215,207
<TOTAL-REVENUES> 215,207
<CGS> 138,132
<TOTAL-COSTS> 167,372
<OTHER-EXPENSES> (753)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 55,344
<INCOME-PRETAX> 10,791
<INCOME-TAX> 5,227<F5>
<INCOME-CONTINUING> 5,564
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,564
<EPS-PRIMARY> 1.00<F4>
<EPS-DILUTED> 1.00<F4>
<FN>
<F1>See Notes 5, 15 and 16 to Notes to Consolidated Financial
Statements
<F2>See Note 7 to Notes to Consolidated Financial Statements
<F3>See Notes 7, 8 and 9 to Notes to Consolidated Financial <PAGE>
Statements
<F4>See Note 10 to Notes to Consolidated Financial Statements
<F5>See Note 11 to Notes to Consolidated Financial Statements
</FN>
</TABLE>
