UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K
(Mark One)
(X) Annual Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For Fiscal Year Ended: January 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: 0-15907
Exact name of registrant as specified in its charter:
PROFFITT'S, INC.
State of Incorporation: Tennessee
I.R.S. Employer Identification Number: 62-0331040
Address of principal executive offices (including zip code):
P.O. Box 9388, Alcoa, Tennessee 37701
Registrant's telephone number, including area code: (615) 983-7000
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act:
COMMON STOCK, PAR VALUE $.10
Indicate by check mark whether Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities and
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the Registrant was required to file such
reports) and (2) has been subject to such filing requirements for
the past 90 days.
Yes (X) No ( )
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of the Registrant's knowledge, in
definitive proxy or information statements incorporated by
reference in Part II of this Form 10-K or any amendment to this
Form 10-K.
( )
The aggregate market value of the voting stock held by non-
affiliates of the Registrant as of March 29, 1995 was approximately
$201,785,375.
As of March 29, 1995, the number of shares of the Registrant's
Common Stock outstanding was 10,218,624.
DOCUMENTS INCORPORATED BY REFERENCE
(1) Portions of the Proffitt's, Inc. Annual Report to
Shareholders for the Fiscal Year Ended January 28, 1995 are
incorporated by reference into Part II.
(2) Portions of the Proffitt's, Inc. Proxy Statement dated May
2, 1995 for the Annual Shareholders' Meeting to be held on June 15,
1995 are incorporated by reference into Part III.
The Exhibit Index is on page of this document.
TABLE OF CONTENTS
Item Page
Part I 1 Business. 3
2 Properties. 6
3 Legal Proceedings. 9
4 Submission of Matters to a Vote of 9
Security Holders.
Executive Officers of the Registrant. 9
Part II 5 Market for Registrant's Common Equity 11
and Related Stockholder Matters.
6 Selected Financial Data. 11
7 Management's Discussion and Analysis 11
of Financial Condition and Results of
Operations.
8 Financial Statements and Supplementary 11
Data.
9 Changes in and Disagreements with 11
Accountants on Accounting and
Financial Disclosure.
Part III 10 Directors and Executive Officers of the 12
Registrant.
11 Executive Compensation. 12
12 Security Ownership of Certain Beneficial 12
Owners and Management.
13 Certain Relationships and Related 12
Transactions.
Part IV 14 Exhibits, Financial Statement Schedules, 12
and Reports on Form 8-K.
Signatures 14
<PAGE>
PART I
Item 1. Business.
General.
Founded in 1919, Proffitt's, Inc. is a leading regional specialty
department store company offering a wide selection of fashion
apparel, accessories, cosmetics, and decorative home furnishings,
featuring assortments of premier brands and unique specialty
merchandise. The Company's stores are primarily anchor stores in
leading regional malls. The Company's objective is to be the
dominant specialty department store chain in its region through a
strategy which combines fashion leadership with opening or
acquiring new stores and expanding and renovating existing stores.
The Company has experienced significant growth since 1991. During
1992 and 1993, the Company purchased certain real and personal
property and assumed certain operating leases of eighteen store
locations from Hess Department Stores, Inc. and Crown American
Corporation for a total purchase price of approximately $24
million. The acquired locations were in Tennessee, Virginia,
Georgia, and Kentucky. These stores were renovated and placed in
service as Proffitt's stores in 1992 and 1993.
In March 1994, Proffitt's, Inc. acquired all of the outstanding
common stock of Macco Investments, Inc., a holding company for
McRae's, Inc., a privately-owned retail department store chain with
28 department stores headquartered in Jackson, Mississippi. The
acquisition price for the common stock and certain real property
totaled approximately $212 million.
The Company now operates two stores divisions: the Proffitt's
Division with 25 stores and the McRae's Division with 28 department
stores and one home furnishings specialty store. The Proffitt's
stores are located in Tennessee (twelve stores), Virginia (eight
stores), Georgia (two stores), Kentucky (two stores), and North
Carolina (one store). The McRae's department stores are located in
Alabama (thirteen stores), Mississippi (twelve stores), Florida (two
stores), and Louisiana (one store).
The Company operates separate merchandising, sales promotion, and
store operating divisions for the Proffitt's and McRae's Divisions
but operates centralized administrative and support functions, such
as accounting, information systems, and credit.
In March 1995, the Company purchased a majority interest in Parks-
Belk Company, the owner/operator of four Parks-Belk stores located in
northeast Tennessee for an undisclosed purchase price which was not
material. The Company intends to purchase the remaining interest in
Parks-Belk and convert the stores to Proffitt's stores in 1995.
MERCHANDISING.
The Company's merchandising strategy is to provide middle to upper
income customers a wide assortment of fashionable apparel,
accessories, cosmetics, and decorative home furnishings. The
Company's commitment to a branded merchandising strategy, enhanced by
its merchandise presentation and high level of customer service,
makes it a preferred distribution channel for premier brand-name
merchandise. Key brands featured include Liz Claiborne, Polo/Ralph
Lauren, Tommy Hilfiger, Estee Lauder, Vanity Fair, and Waterford.
The Company supplements its branded assortments with high-quality,
private-label merchandise.
Proffitt's, Inc. has developed a thorough knowledge of its regional
market and customer base. Such knowledge, in conjunction with
frequent store visits by senior management and merchandising
personnel and use of on-line merchandise information, enables the
Company to tailor each store's merchandise assortments to the unique
characteristics of its markets.
Management and the merchandising staff utilize an inventory tracking
system which provides on-line information as to current sales and
inventory levels by store, department, vendor, class, style, size,
and color. Based on this information, the Company can analyze market
trends, identify fast- or slow- moving merchandise, and make
reordering and pricing decisions on a daily basis.
ADVERTISING AND SALES PROMOTION.
Proffitt's advertising and sales promotion strategy primarily is
designed to reinforce the Company's image as the fashion leader in
its markets. The Company's advertisements and promotional events
highlight the style, quality, and value of its merchandise.
A variety of media, including newspaper, television, radio, and
direct mail, are used to advertise specific brands and special
events. The Company's advertising and special events are produced by
an in-house sales promotion staff in conjunction with outside
advertising agencies as needed. The Company utilizes data captured
through the use of the Proffitt's and McRae's credit cards to develop
segmented advertising and promotional events targeted at specific
customers who have established purchasing patterns for certain
brands, departments, and store locations. To promote its image as
the fashion leader in its markets, the Company also sponsors fashion
shows and in-store special events highlighting the Company's key
brands.
CUSTOMER SERVICE.
The Company believes that personal customer attention builds loyalty
and that the Company's sales associates provide a superior level of
customer service. Each store is staffed with knowledgeable, friendly
sales associates skilled in salesmanship and customer service. Sales
associates maintain customer records, send personalized thank-you
notes, and communicate personally with customers to advise them of
special promotions and new merchandise offerings. Superior customer
service is encouraged through the development and monitoring of sales
goals and through specific award and recognition programs.
SEASONALITY.
The Company's business, like that of most retailers, is subject to
seasonal influences, with a significant portion of its net sales and
net income realized during the fourth quarter of each year, which
includes the Christmas selling season. Generally, more than 30% of
the Company's sales and over 50% of its net income are generated
during the fourth quarter.
PURCHASING AND DISTRIBUTION.
The Company purchases merchandise from numerous suppliers.
Management monitors the Company's profitability and sales history
with each key vendor and believes it has alternative sources
available for each category of merchandise it purchases. Management
believes it has a good relationship with its suppliers.
For the Proffitt's Division, merchandise is shipped directly from
suppliers to the Division's 96,000 square foot distribution center in
metropolitan Knoxville, Tennessee, where it is inspected, entered
into the inventory control system, and tagged with computer-generated
price tickets.
The McRae's Division completed the construction of a 164,000 square
foot state-of-the-art distribution facility in Jackson, Mississippi,
in early 1994. This owned facility is designed to serve up to 38
stores and can be readily expanded to serve up to 100 stores.
The data system which the McRae's Division has developed for its new
distribution center utilizes the latest technology and is expected to
improve efficiency and generate cost savings. For example, the high
speed automated conveyor system designed for the center is capable of
scanning bar coded labels and diverting cartons to the proper
merchandise processing areas. In addition, some types of merchandise
are being processed in the receiving area and immediately "cross-
docked" to the shipping dock for delivery to the stores. Certain
processing areas are staffed with personnel equipped with hand-held
radio frequency terminals that can scan a vendor's bar code and
transmit the necessary information to a computer to check-in
merchandise. This technology, when fully utilized, will create a
nearly paperless environment for the distribution function.
COMPETITION.
The specialty department store business is highly competitive. The
Company's stores compete with several national and regional
department stores, specialty apparel stores, and other retail stores,
some of which have greater financial and other resources than the
Company. Management believes that its knowledge of the Company's
regional markets and customer base provides a competitive advantage.
EMPLOYEES.
At March 31, 1995, the Proffitt's Division employed approximately
3700 associates of whom approximately 1400 were employed on a part-
time basis (fewer than 30 hours per week). On that date, the McRae's
Division employed approximately 5700 associates, of whom 2000 were
employed on a part-time basis (fewer than 30 hours per week). The
Company hires additional temporary employees and increases the hours
of part-time employees during seasonal peak selling periods. None of
the Company's employees is covered by a collective bargaining
agreement. The Company considers its relations with its employees to
be good.
ITEM 2. PROPERTIES.
The Proffitt's Division's leased administrative offices are located
in the Midland Shopping Center in metropolitan Knoxville, Tennessee
and consist of approximately 45,000 square feet. The Division's
owned distribution center is located in metropolitan Knoxville and
contains approximately 96,000 square feet.
The McRae's Division owns its administrative office building in
Jackson, Mississippi. This facility consists of 288,000 square feet
of space, of which 136,000 square feet is office space and 152,000
square feet is the Division's processing area for merchandise returns
to vendors and a furniture warehouse. The 164,000 square foot
distribution center located in metropolitan Jackson is owned.
The following table summarizes all owned and leased store locations.
Store leases generally require the Company to pay the greater of a
fixed minimum rent or an amount based on a percentage of sales.
Generally, the Company is responsible under its store leases for a
portion of mall promotion and common area maintenance expenses and
for certain utility, property tax, and insurance expenses.
Typically, the Company contributes to common mall promotion,
maintenance, property tax, and insurance expenses at its owned
locations.
YEAR
YEAR REFURBISHED APPROX.
OPENED OR OR SELLING OWNED/
ACQUIRED EXPANDED SQ. FT. LEASED
STORE LOCATIONS
PROFFITT'S DIVISION STORES:
KNOXVILLE METROPOLITAN:
West Town Mall (Knoxville, TN) 1972 1995 141,000 Leased
East Towne Mall (Knoxville, TN) 1984 1992 85,600 Owned
Foothills Mall (Maryville, TN) 1983 1993 121,000 Owned
Oak Ridge Mall (Oak Ridge, TN) 1974 1993 94,600 Leased
Proffitt's Plaza (Athens, TN) 1992 -- 48,200 Leased
College Square (Morristown, TN) 1993 -- 43,000 Owned
CHATTANOOGA METROPOLITAN:
Hamilton Place (Chattanooga,TN) 1988 1993 202,300 Owned
Eastgate Mall (Chattanooga, TN) 1988 1989 56,800 Leased
Walnut Square (Dalton, GA) 1988 1988 48,400 Owned
Northgate Mall (Chattanooga, TN) 1989 1993 80,800 Owned
Bradley Square (Cleveland, TN) 1992 1992 45,800 Leased
Mt. Berry Mall (Rome, GA) 1993 1993 56,300 Leased
TRI-CITIES METROPOLITAN:
The Mall at Johnson City
(Johnson City, TN) 1992 1994 91,600 Leased
Fort Henry Mall (Kingsport, TN) 1992 1993 46,700 Leased
Bristol Mall (Bristol, VA) 1992 1993 39,300 Leased
NORFOLK/VIRGINIA BEACH MARKET:
Coliseum Mall (Hampton, VA) 1993 1993 95,000 Leased
Patrick Henry Mall
(Newport News, VA) 1993 1993 56,100 Leased
Greenbrier Mall (Chesapeake, VA) 1993 1993 67,200 Leased
Chesapeake Square (Chesapeake, VA) 1993 1993 70,300 Owned
Pembroke Mall (Virginia Beach, VA) 1993 1993 56,200 Owned
KENTUCKY:
Towne Mall (Elizabethtown, KY) 1993 1993 41,800 Leased
Ashland Town Center (Ashland, KY) 1993 1993 56,600 Leased
ASHEVILLE METROPOLITAN:
Biltmore Square (Asheville, NC) 1989 -- 71,100 Owned
RICHMOND METROPOLITAN:
Chesterfield (Richmond, VA) 1993 1993 55,900 Leased
Virginia Commons (Richmond, VA) 1993 1993 68,800 Leased
Total Proffitt's Division 1,840,400
<PAGE>
YEAR
REFURBISHED APPROX.
YEAR OR SELLING OWNED/
OPENED EXPANDED SQ. FT. LEASED
STORE LOCATIONS
MCRAE'S DIVISION STORES:
JACKSON METROPOLITAN:
Meadowbrook Mall (Jackson, MS) 1955 1987 57,400 Leased
Metrocenter Mall (Jackson, MS) 1978 1992 188,000 Owned
Northpark Mall (Jackson, MS) 1984 -- 175,400 Owned
BIRMINGHAM METROPOLITAN:
Roebuck Plaza (Birmingham, AL) 1960 -- 55,800 Leased
Century Plaza (Birmingham, AL) 1980 1991 109,800 Leased
Brookwood Village (Birmingham, AL) 1975 1993 91,900 Leased
Western Hills Mall (Birmingham, AL) 1980 1986 109,200 Leased
Riverchase Galleria (Birmingham, AL) 1986 1993 121,200 Leased
HUNTSVILLE, ALABAMA:
Parkway City Mall (Huntsville, AL) 1961 1987 60,800 Leased
Madison Square (Huntsville, AL) 1984 -- 85,600 Leased
FLORIDA PANHANDLE:
University Mall (Pensacola, FL) 1974 1984 114,000 Owned
Santa Rosa Mall (Mary Esther, FL) 1986 -- 74,500 Owned
OTHER MISSISSIPPI MARKETS:
Greenville Mall (Greenville, MS) 1973 -- 59,100 Leased
Village Fair Mall (Meridian, MS) 1972 -- 67,300 Leased
Pemberton Mall (Vicksburg, MS) 1970 1985 54,500 Owned
TurtleCreek Mall (Hattiesburg, MS) 1994 -- 110,400 Owned
Barnes Crossing (Tupelo, MS) 1976 1990 88,700 Owned
Natchez Mall (Natchez, MS) 1979 1993 59,800 Leased
Singing River Mall (Gautier, MS) 1980 -- 79,200 Owned
Sawmill Square (Laurel, MS) 1981 -- 58,500 Owned
University Mall (Columbus, MS) 1983 -- 66,700 Owned
OTHER ALABAMA MARKETS:
Springdale Mall (Mobile, AL) 1984 1989 141,800 Owned
Eastdale Mall (Montgomery, AL) 1977 -- 62,200 Leased
Gadsden Mall (Gadsden, AL) 1974 -- 73,900 Leased
Regency Square (Florence, AL) 1978 -- 35,200 Leased
University Mall (Tuscaloosa, AL) 1980 -- 80,400 Leased
Wiregrass Commons (Dothan, AL) 1986 -- 87,000 Leased
MONROE, LOUISIANA:
Pecanland Mall (Monroe, LA) 1985 -- 94,900 Owned
Total McRae's Division 2,463,200
GRAND TOTAL 4,303,600
<PAGE>
ITEM 3. LEGAL PROCEEDINGS.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The Company did not submit any matters to a vote of security
holders during the fourth quarter of its fiscal year ended January
28, 1995.
EXECUTIVE OFFICERS OF THE REGISTRANT.
The name, age, and position held with the Company of each of the
executive officers of the Company are set forth below.
NAME AGE POSITION
R. Brad Martin 43 Chairman of the Board and Chief
Executive Officer
James A. Coggin 53 President and Chief Operating
Officer
Gary L. Howard 52 President, McRae's Division
Frederick J. Mershad 52 President, Proffitt's Division
James E. Glasscock 53 Executive Vice President, Chief
Financial Officer, and
Treasurer
Robert Oliver 60 Executive Vice President of
Stores, McRae's Division
A. Coleman Piper 48 Executive Vice President of
Stores, Proffitt's Division
Brian J. Martin 38 Senior Vice President and
General Counsel
David W. Baker 58 Senior Vice President of
Operations
James E. VanNoy 55 Senior Vice President and Chief
Information Officer
Julia A. Bentley 36 Senior Vice President of
Planning and Investor Relations
and Secretary
_________________________________________________________________
R. Brad Martin became Chairman of the Board in February 1987 and
Chief Executive Officer in July 1989. Mr. Martin previously served
as President from July 1989 until March 1994 and from September
1994 to March 1995.
James A. Coggin was named President of Proffitt's, Inc. in March
1995 and served as Executive Vice President and Chief Operating
Officer of the Company from September 1994 to March 1995 and as
Executive Vice President and Chief Administrative Officer of the
Company from March 1994 to September 1994. From June 1978 to March
1994, Mr. Coggin served as Executive Vice President and Chief
Administrative Officer of McRae's, Inc. Mr.Coggin joined McRae's,
Inc. in 1971.
Gary L. Howard became President of the McRae's Division in March
1995. Between March 1994 and March 1995, Mr. Howard served as
Executive Vice President of Merchandising and Marketing for the
McRae's Division of Proffitt's, Inc. Mr. Howard joined McRae's,
Inc. in November 1993 as Executive Vice President of Merchandising
and Marketing. Mr. Howard has over 30 years of prior experience in
the retail industry, including service as Senior Vice President and
General Merchandise Manager of Maas Brothers and Woodward and
Lothrop.
Frederick J. Mershad was named President of the Proffitt's Division
in March 1995. Mr. Mershad joined the Company in May 1994 as
Executive Vice President of Merchandising and Sales Promotion for
the Proffitt's Division. Mr. Mershad has over 25 years of retail
experience and has held executive merchandising positions with such
retailers as Rich's, a division of Federated Department Stores, and
McRae's.
James E. Glasscock was appointed Executive Vice President, Chief
Financial Officer, and Treasurer of the Company in March 1995. Mr.
Glasscock served as Senior Vice President, Chief Financial Officer,
and Treasurer of Proffitt's, Inc. between March 1994 and March
1995. From May 1985 to March 1994, Mr. Glasscock served as Senior
Vice President of Finance for McRae's, Inc. Mr. Glasscock is a
Certified Public Accountant with several years of public accounting
and private industry experience, including over twenty-four years
of retail experience.
Robert Oliver was promoted to Executive Vice President of Stores
for the McRae's Division in March 1995. Mr. Oliver served as Vice
President of Stores for the McRae's Division from March 1994 to
March 1995. He joined McRae's, Inc. in 1991 as Vice President of
Stores after gaining 33 years of merchandising and store management
experience with Foley's.
A. Coleman Piper was named Executive Vice President for Stores of
the Proffitt's Division in March 1995. He served as Executive Vice
President for Human Resources and Proffitt's Division Stores from
September 1994 to March 1995 and Executive Vice President of
Operations and Real Estate for Proffitt's, Inc. from March 1994 to
September 1994. He has been with the Company since 1972 and
previously served in several capacities including Vice President of
Operations.
Brian J. Martin was promoted to Senior Vice President and General
Counsel of the Company in March 1995. He joined Proffitt's, Inc.
in June 1994 as Vice President and General Counsel. From June 1990
to May 1994, Mr. Martin was affiliated with the Indianapolis,
Indiana law firm of Barnes and Thornburg. Mr. Martin served as
Assistant Solicitor General of the United States between January
1988 and June 1990.
David W. Baker was named Senior Vice President of Operations for
the Company in March 1994. Mr. Baker joined McRae's, Inc. in
February 1985 and served as Senior Vice President of Operations for
McRae's until March 1994.
James E. VanNoy became Senior Vice President and Chief Information
Officer of the Company in March 1994. Mr. VanNoy joined McRae's,
Inc. in February 1980 as Director of Management Information Systems
and was promoted to Vice President of Management Information
Systems in February 1982.
Julia A. Bentley was named Senior Vice President of Planning and
Investor Relations and Secretary of Proffitt's, Inc. in March 1994.
In January 1993, Ms. Bentley was promoted to Senior Vice President
of Finance, Chief Financial Officer, Secretary, and Treasurer after
serving as Vice President of Finance since March 1989. From July
1987 to February 1989, Ms. Bentley served first as Director of
Investor Relations and subsequently as Director of Human Resources
of the Company. Ms. Bentley is a Certified Public Accountant with
several years of public accounting experience.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS.
The information set forth under the caption "Market Information"
appearing on page 10 of the Proffitt's, Inc. Annual Report to
Shareholders for the Fiscal Year Ended January 28, 1995 (the
"Annual Report") is incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA.
The information set forth under the caption "Five-Year Financial
Summary" appearing on page 4 of the Annual Report is incorporated
herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
The information set forth under the caption "Management's
Discussion and Analysis" appearing on pages 5 through 9 of the
Annual Report is incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The Consolidated Financial Statements and the Report of Independent
Accountants appearing on pages 11 through 26 of the Annual Report
are incorporated herein by reference.
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 information set forth under the captions "Election of
Directors" and "Section 16(a) of the Securities Exchange Act of
1934" contained on pages 5 and 6 and page 15, respectively, of the
Proffitt's, Inc. Proxy Statement dated May 2, 1992 (the "Proxy
Statement"), with respect to Directors of the Company, is
incorporated herein by reference.
The information required under this item with respect to the
Company's Executive Officers is incorporated by reference from Part
I of this report under the caption "Executive Officers of the
Registrant."
ITEM 11. EXECUTIVE COMPENSATION.
The information set forth under the caption "Executive
Compensation" contained on pages 7 through 10 of the Proxy
Statement with respect to executive compensation is incorporated
herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
The information set forth under the caption "Outstanding Voting
Securities" contained on pages 3 and 4 of the Proxy Statement with
respect to security ownership of certain beneficial owners and
management is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The information set forth under the captions "Further Information
Concerning Directors" and "Certain Transactions" contained on pages
6 and 7 and 11 and 12, respectively, of the Proxy Statement with
respect to certain relationships and related transactions is
incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K.
(a) (1) and (2)--The response to this portion of Item 14 is
submitted as a separate section of this report.
(3)--The response to this portion of Item 14 is submitted as
a separate section of this report.
(b) Reports on Form 8-K filed during the fourth quarter - None.
(c) Exhibits--The response to this portion of Item 14 is
submitted as a separate section of this report.
(d) Financial statement schedules--The response to this portion of
Item 14 is submitted as a separate section of this report.
FORM 10-K--ITEM 14(a)(1) AND (2) AND (d)
PROFFITT'S, INC. AND SUBSIDIARIES
LIST OF FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
(a) The following documents are filed as a part of this report:
(1) Consolidated Financial Statements
The following consolidated financial statements of Proffitt's,
Inc. and subsidiaries, included on pages 11 through 26 of the
Proffitt's, Inc. Annual Report to Shareholders for the Fiscal
Year Ended January 28, 1995, are incorporated by reference in
Item 8:
Consolidated Balance Sheets as of January 28, 1995 and January
29, 1994
Consolidated Statements of Income for Fiscal Years Ended
January 28, 1995, January 29, 1994, and January 30, 1993
Consolidated Statements of Shareholders' Equity for Fiscal
Years Ended January 28, 1995, January 29, 1994, and January
30, 1993
Consolidated Statements of Cash Flows for Fiscal Years Ended
January 28, 1995, January 29, 1994, and January 30, 1993
Notes to Consolidated Financial Statements
(2) Schedules to Financial Statements
The following consolidated financial statement schedules of
Proffitt's, Inc. and subsidiaries are included in Item 14(d):
Report of Independent Accountants for the Fiscal Years Ended
January 28, 1995, January 29, 1994, and January 30, 1993
Schedule II - Valuation and Qualifying Accounts
All other schedules for which provision is made in the
applicable accounting regulation of the Securities and
Exchange Commission are not required under the related
instructions or are inapplicable and therefore have been
omitted.
SIGNATURES
Proffitt's, Inc.
Registrant
Date: April 25, 1995 /s/ James E. Glasscock
James E. Glasscock
Executive Vice President, Chief
Financial Officer and Treasurer
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the Registrant and in the capacities and on the dates
indicated.
/s/ R. Brad Martin /s/ Richard D. McRae
R. Brad Martin Richard D. McRae
Chairman of the Board and Director
Chief Executive Officer
/s/ James A. Coggin /s/ C. Warren Neel
James A. Coggin C. Warren Neel
President Director
/s/ Bernard E. Bernstein /s/ Harwell W. Proffitt
Bernard E. Bernstein Harwell W. Proffitt
Director Director
/s/ Edmond D. Cicala /s/ Gerald Tsai, Jr.
Edmond D. Cicala Gerald Tsai, Jr.
Director Director
/s/ Ronald de Waal /s/ Julia A. Bentley
Ronald de Waal Julia A. Bentley
Director Senior Vice President
and Secretary
/s/ Michael A. Gross
Michael A. Gross
Director
<PAGE>
PROFFITT'S, INC. AND SUBSIDIARIES
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
BALANCE
AT CHARGED CHARGED BALANCE
BEGINNING TO TO AT
OF COSTS AND OTHER END OF
DESCRIPTION PERIOD EXPENSES ACCOUNTS DEDUCTIONS PERIOD
Year ended
January 28, 1995:
Allowance for
doubtful accounts $1,195,418 $2,625,638 $1,431,988(A) ($2,841,832)(B) $2,411,212
Year ended
January 29, 1994:
Allowance for
doubtful accounts $1,398,155 $ 413,223 - 0 - ($ 615,960)(B) $1,195,418
Year ended
January 30, 1993:
Allowance for
doubtful accounts $ 946,368 $1,001,131 - 0 - ($ 549,344)(B) $1,398,155
Note A - Balance in account of company (McRae's, Inc.) acquired at March 31,
1994.
Note B - Uncollectible accounts written off, net of recoveries.
<PAGE>
FORM 10-K -- ITEM 14(a)(3) AND 14(c)
PROFFITT'S, INC. AND SUBSIDIARIES
EXHIBITS
Exhibit
No. Description
3.1 Charter of the Company, as amended (1)
3.2 Articles of Amendment of the Charter of Proffitt's, Inc., designating
the rights, preferences, and limitations of its Series A Cumulative
Convertible Exchangeable Preferred Stock (7)
3.3 Articles of Amendment to the Charter of Proffitt's, Inc., designating
the rights, preferences, and limitations of its Series B Cumulative
Junior Perpetual Preferred Stock (7)
3.4 Bylaws of the Company, as amended (1)
3.5 Articles of Amendment to the Charter of Proffitt's, Inc., designating
the rights, preferences, and limitations of its Series C Junior
Preferred Stock (10)
4.1 Form of 7.5% Junior Subordinated Debentures due 2004 (7)
4.2 Form of 4.75% Convertible Subordinated Debentures due 2003 (5)
4.3 Form of Rights Certificate (10)
10.1 Standard Services Agreement dated August 1, 1984, between Proffitt's,
Inc. and Frederick Atkins, Inc. (7)
10.2 Standard Services Agreement dated August 1, 1984 between McRae's,
Inc. and Frederick Atkins, Inc. (7)
10.3 Business Combination Agreement by and among McRae's, Inc., Macco
Investments, Inc., and Proffitt's, Inc. dated as of March 3, 1994 and
First Amendment thereto dated as of March 31, 1994 (7)
10.4 Registration Rights Agreement made as of March 31, 1994 by and among
Proffitt's, Inc. and Richard D. McRae, Jr., as Representative of the
former shareholders of Macco Investments, Inc. (7)
10.5 Non-competition Agreement by and between Proffitt's, Inc. and Richard
D. McRae dated March 31, 1994 (7)
10.6 Credit Facilities and Reimbursement Agreement by and among Proffitt's,
Inc., the lenders from time to time party thereto and NationsBank of
Texas, National Association, as agent, dated March 31, 1994 (7)
10.7 * Amendment No. 2 to Credit Facilities and Reimbursement Agreement
between Proffitt's, Inc. and NationsBank of Texas, National
Association, as agent, dated March 7, 1995
10.8 * Amendment No. 1 to Credit Facilities and Reimbursement Agreement
between Proffitt's, Inc. and NationsBank of Texas, National
Association, as agent, dated November 15, 1994
10.9 Guaranty Agreement made and entered into as of March 31, 1994, by and
between each of Proffitt's Investments, Inc., PDS Agency, Inc., Macco
Investments, Inc., McRae's, Inc., and McRae's of Alabama, Inc., and
NationsBank of Texas, National Association (7)
10.10 Transfer and Administration Agreement dated as of January 27, 1993,
and amended by Amendment dated as of March 31, 1994 thereto, by and
between Enterprise Funding Corporation and McRae's, Inc. (7)
10.11 * Amendment to Transfer and Administration Agreement by and between
Enterprise Funding Corporation and McRae's, Inc. dated March 31, 1995
10.12 Assignment Agreement dated as of March 31, 1994, between Proffitt's,
Inc. and McRae's, Inc. (7)
10.13 Securities Purchase Agreement dated March 3, 1994, between Proffitt's,
Inc. and Apollo Specialty Retail Partners, L.P. (7)
10.14 Registration Rights Agreement made and entered into as of March 31,
1994, by and among Proffitt's, Inc. and Apollo Specialty Retail
Partners, L.P. (7)
10.15 Land Deed of Trust dated April 1, 1994 by and among McRae's, Inc.,
Don B. Cannada, and Park Real Estate Company (7)
10.16 Real Estate Property Purchase Agreement dated April 1, 1994, by and
between Park Real Estate Company and McRae's, Inc. (7)
10.17 Secured Promissory Note, dated April 1, 1994, for the principal
amount of $3,906,558 by McRae's, Inc. payable to Park Real Estate
Company (7)
10.18 Assumption, Consent, and Release Agreement, entered into between
McRae's, Inc. and Deposit Guaranty National Bank dated April 1, 1994
(7)
10.19 Amended and Restated Promissory Note dated April 1, 1994 for the
principal amount of $2,075,000 by McRae's, Inc. payable to First
Tennessee Bank National Association (Gautier) (7)
10.20 Assumption, Consent, and Release Agreement, entered into between
McRae's, Inc. and First Tennessee Bank National Association dated
April 1, 1994 (7)
10.21 Secured Promissory Note, dated April 1, 1994, for the principal
amount of $556,851 by McRae's, Inc. payable to Arvey Real Estate
Company (Gautier) (7)
10.22 Real Property Purchase Agreement dated April 1, 1994, by and between
Arvey Real Estate Company and McRae's, Inc. (Gautier) (7)
10.23 Land Deed of Trust dated April 1, 1994 by and among McRae's, Inc.,
Don B. Cannada, and Arvey Real Estate Company (Gautier) (7)
10.24 Assumption, Consent, and Release Agreement, entered into between
McRae's, Inc. and First Tennessee Bank National Association dated
April 1, 1994 (Gautier) (7)
10.25 Real Property Purchase Agreement dated April 1, 1994, by and between
Green's Crossing Real Estate Company and McRae's, Inc. (7)
10.26 Secured Promissory Note, dated April 1, 1994, for the principal
amount of $1,487,919 by McRae's, Inc. payable to Green's Crossing
Real Estate Company (7)
10.27 Assumption, Consent, and Release Agreement, entered into between
McRae's, Inc. and Deposit Guaranty National Bank dated April 1, 1994
(7)
10.28 Land Deed of Trust dated April 1, 1994 by and among McRae's, Inc.,
Don B. Cannada, and Green's Crossing Real Estate Company (7)
10.29 Secured Promissory Note, dated April 1, 1994, for the principal
amount of $1,779,223 by McRae's, Inc. payable to Arvey Real Estate
Company (Laurel) (7)
10.30 Property Purchase Agreement dated April 1, 1994, by and between Arvey
Real Estate Company and McRae's, Inc. (Laurel) (7)
10.31 Assumption, Consent, and Release Agreement, entered into between
McRae's, Inc. and AmSouth Bank National Association dated April 1,
1994 (7)
10.32 Assignment of Leasehold Interest from Arvey Real Estate Company to
McRae's, Inc. dated April 1, 1994 (Laurel) (7)
10.33 Leasehold Deed of Trust dated April 1, 1994 by and among McRae's,
Inc., Don B. Cannada, and Arvey Real Estate Company (Laurel) (7)
10.34 Indemnification and Confirmation of Lease Agreement dated March 31,
1994, entered into among McRae's, Inc., Richard D. McRae, Jr., Susan
McRae Shanor, and Vaughan McRae (Heritage Building) (7)
10.35 Guaranty Agreement dated March 31, 1994 of McRae's, Inc. to guarantee
Richard D. McRae, Carolyn McRae, Susan McRae Shanor, and Vaughan W.
McRae giving or extending credit to Proffitt's, Inc. (7)
10.36 Land Deed of Trust dated March 31, 1994 by and among McRae's, Inc.,
Don B. Cannada, Richard D. McRae, Carolyn S. McRae, Susan McRae
Shanor, and Vaughan McRae (7)
10.37 Guaranty Agreement by Proffitt's, Inc. to AmSouth Bank guaranteeing
credit extended to McRae's, Inc. (7)
10.38 Promissory Note dated January 25, 1983 by McRae's, Inc. payable to
Selby W. McRae in the principal sum of $1,346,442 (6)
10.39 Rights Agreement dated as of March 28, 1995 between Proffitt's, Inc.
and Union Planters National Bank as Rights Agent (10)
MANAGEMENT CONTRACTS, COMPENSATORY PLANS, OR ARRANGEMENTS, ETC.
10.40 Proffitt's, Inc. 1987 Stock Option Plan, as amended (3)
10.41 Proffitt's, Inc. 1994 Employee Stock Purchase Plan (9)
10.42 Proffitt's, Inc. 1994 Long-Term Incentive Plan (8)
10.43 Proffitt's, Inc. 401(k) Retirement Plan (6)
10.44 $500,000 Loan Agreement dated February 1, 1989 between the Company and
R. Brad Martin (2)
10.45 * Form of Employment Agreement by and between Proffitt's, Inc. and R.
Brad Martin dated March 28, 1995
10.46 * Form of Employment Agreement by and between Proffitt's, Inc. and
James A. Coggin dated March 28, 1995
10.47 * Form of Employment Agreement by and between Proffitt's, Inc. and
James E. Glasscock dated March 28, 1995
10.48 * Form of Employment Agreement by and between Proffitt's, Inc. and
Frederick J. Mershad dated March 28, 1995
10.49 * Form of Employment Agreement by and between Proffitt's, Inc. and Gary
L. Howard dated March 28, 1995
10.50 * Form of Employment Agreement by and between Proffitt's, Inc. and
Brian J. Martin dated March 28, 1995
10.51 * Form of Employment Agreement by and between Proffitt's, Inc. and
James E. VanNoy dated March 28, 1995
10.52 * Form of Employment Agreement by and between Proffitt's, Inc. and
David W. Baker dated March 28, 1995
10.53 * Form of Employment Agreement by and between Proffitt's, Inc. and A.
Coleman Piper dated March 28, 1995
10.54 * Form of Employment Agreement by and between Proffitt's, Inc. and
Robert Oliver dated March 28, 1995
10.55 * Form of Employment Agreement by and between Proffitt's, Inc. and
Julia A. Bentley dated March 28, 1995
10.56 * Form of Employment Agreement by and between Proffitt's, Inc. and Anne
Breier Pope dated March 7, 1995
11.1 * Statement re: computation of earnings per share
13.1 * Annual Report to Shareholders for the fiscal year ended January 28,
1995
22.1 * Subsidiaries of the Registrant
24.1 * Consent of Independent Accountants
27.1 * Financial Data Schedule
* Previously unfiled documents are noted with an asterisk
(1) Incorporated by reference from the Exhibits to the Form S-1 Registration
Statement No. 33-13548 of the Company dated June 3, 1987.
(2) Incorporated by reference from the Exhibits to the Form 10-K of the Company
for the fiscal year ended January 28, 1989.
(3) Incorporated by reference from the Exhibits to the Form S-8 Registration
Statement No. 33-46306 of the Company dated March 10, 1992.
(4) Incorporated by reference from the Exhibits to the Form 8-K of the Company
dated October 23, 1992.
(5) Incorporated by reference from the Exhibits to the Form S-3 Registration
Statement No. 33-70000 of the Company dated October 19, 1993.
(6) Incorporated by reference from the Exhibits to the Form 10-K of the Company
for the fiscal year ended January 29, 1994.
(7) Incorporated by reference from the Exhibits to the Form 8-K of the Company
dated April 14, 1994.
(8) Incorporated by reference from the Exhibits to the Form S-8 Registration
Statement No. 33-80602 of the Company dated June 23, 1994.
(9) Incorporated by reference from the Exhibits to the Form S-8 Registration
Statement No. 33-88390 of the Company dated January 11, 1995.
(10) Incorporated by reference from the Exhibits to the Form 8-K of the Company
dated April 3, 1995.
EXHIBIT 10.7
AMENDMENT NO. 2 TO CREDIT FACILITIES
AND REIMBURSEMENT AGREEMENT
THIS AMENDMENT NO. 2 TO CREDIT FACILITIES AND REIMBURSEMENT
AGREEMENT (this "Agreement") is made and entered into as of this
7th day of March, 1995 among:
PROFFITT'S, INC., a Tennessee corporation having its principal
place of business in Alcoa, Tennessee (the "Borrower"); and
Each lender executing and delivering a signature page hereto
(hereinafter such lenders may be referred to individually as a
"Lender" or collectively as the "Lenders"); and
NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION, a national banking
association organized and existing under the laws of the United
States of America ("NationsBank"), in its capacity as agent for the
Lenders (in such capacity, the "Agent");
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders and the Agent have entered
into a Credit facilities and Reimbursement Agreement dated as of
March 31, 1994 (the "Credit Agreement"), pursuant to which the
Lenders agree to make certain Advances to the Borrower;
WHEREAS, the Borrower, the Lenders and the Agent amended the
Credit Agreement pursuant to Amendment No. 1 to Credit Facilities
and Reimbursement Agreement dated as of November 15, 1994; and
WHEREAS, the Borrower has requested that the Credit Agreement
be amended in the manner set forth herein and the Agent and the
Lenders are willing to agree to such amendment;
NOW, THEREFORE, in consideration of the mutual covenants and
the fulfillment of the conditions set forth herein, the parties
hereto do hereby agree as follows:
1. Definitions. Any capitalized terms used herein without
definition shall have the meaning set forth in the Credit
Agreement.
2. Amendment. Subject to the terms and conditions set forth
herein, and in accordance with Section 11.06 of the Credit
Agreement, the Credit Agreement is hereby amended as follows:
(a) Section 7.20(i) is hereby amended and restated in
its entirety to read as follows:
7.20 New Subsidiaries. Simultaneously with the
acquisition or creation of any Subsidiary, or upon any
previously existing Persons becoming a Subsidiary, cause
to be delivered to the Agent for the benefit of the
Lenders each of the following:
(i) a Guaranty executed by such Subsidiary, with
appropriate insertions of identifying information
and such other changes to which the Agent may
consent in its discretion; provided, however under
the transaction dated as of March 7, 1995, between
the Borrower and the shareholders of Parks
Enterprises, Inc. ("PEI") by which the Borrower
agrees to purchase 100% of the shares of stock of
PEI (the "PEI Transaction"), the liability of
Parks-Belk Company with respect to the Guarantor's
Obligations (as defined in the Guaranty) shall be
limited to the maximum aggregate amount at any time
outstanding of Indebtedness for Money Borrowed
advanced to Parks-Belk Company by the Borrower or
any other Subsidiary; provided further, however,
that upon the expiration of the six month period
immediately following the PEI Transaction, if
Parks-Belk's liability under such Guaranty shall be
limited in the manner provided in the immediately
preceding clause or otherwise, there shall be an
Event of Default under the Credit Agreement;
(b) Section 8.02 of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:
8.02 Consolidated Current Ratio. Permit at any time
the ratio of Consolidated Current Assets to Consolidated
Current Liabilities to be less than 2.00 to 1.00;
provided, however, that during the August 15 through
November 15 of each of the Borrower's Fiscal Years, such
ratio shall not be less than 1.60 to 1.00.
(c) Section 8.04 of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:
8.04 Consolidated Fixed Charge Ration. Permit at
any time during any Four-Quarter Period of the Borrower
ending during the periods set forth below, the
Consolidated Fixed Charge Ratio for such Four Quarter
Period to be equal to or less than the ratios set forth
opposite the respective periods below:
Period Ratio
Closing Date through July 28, 1995 1.50 to 1.00
July 29, 1995 through January 2, 1996 1.55 to 1.00
January 3, 1996 through May 3, 1996 1.60 to 1.00
May 4, 1996 and thereafter 1.75 to 1.00
(d) Section 8.06 of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:
8.06 Consolidated Funded Indebtedness to EBITDA.
Permit at any time the ratio of Consolidated Funded
Indebtedness to Consolidated EBITDA to be equal to or
greater than the following ratios set forth opposite the
following periods below:
Period Ratio
Closing Date through January 27, 1995 4.50 to 1.00
January 28, 1995 3.50 to 1.00
January 29, 1995 through July 28, 1995 3.90 to 1.00
July 29, 1995 through October 27, 1995 3.70 to 1.00
October 28, 1995 through February 2, 1996 3.60 to 1.00
February 3, 1996 through May 3, 1996 3.50 to 1.00
May 4, 1996 and thereafter 3.00 to 1.00
3. Representations and Warranties. In order to induce the
Agent and the Lenders to enter into this Agreement, the Borrower
represents and warrants to the Agent and the Lenders as follows:
(a) The representations and warranties made by Borrower
in Article VI of the Credit Agreement are true and correct on
and as of the date hereof;
(b) There has been no material adverse change in the
condition, financial or otherwise, of the Borrower and its
Subsidiaries, taken as a whole, since the date of the most
recent financial reports of the Borrower received by the Agent
and the Lenders under Section 7.01(a) of the Credit Agreement,
other than changes in the ordinary course of business;
(c) The business and properties of the Borrower and its
Subsidiaries, taken as a whole, are not, and since the date of
the most recent financial report of the Borrower and its
Subsidiaries received by the Agent and the Lenders under
Section 7.01(a) of the Credit Agreement, have not been
adversely affected in any substantial way as the result of any
fire, explosion, earthquake, accident, strike, lockout,
combination of workers, flood, embargo, riot, activities of
armed forces, war or acts of God or the public enemy, or
cancellation or loss of any major contracts; and
(d) No event has occurred and is continuing which
constitutes, and no condition exists which upon the
consummation of the transaction contemplated hereby would
constitute, a Default or an Event of Default on the part of
the Borrower under the Credit Agreement.
4. Conditions Precedent. The effectiveness of this
Agreement is subject to the receipt by the parties hereto of the
following:
(a) The Agent shall have received:
(i) eight (8) counterparts of this Agreement duly
executed by all signatories hereto;
(ii) copies of all additional agreements,
instruments and documents which the Agent may reasonably
request, such documents, when appropriate, to be
certified by appropriate governmental authorities.
(b) All proceedings of the borrower relating to the
matters provided for herein shall be satisfactory to the
Lenders, the Agent and their counsel.
5. Waiver. In accordance with Section 11.06 of the Credit
Agreement, Borrower's violation of the negative covenant contained
in Section 8.07(v) will be waived by the Lenders and Agent in
connection with the PEI Transaction; provided that the parties
hereto further agree as follows:
(i) this waiver does not constitute an amendment or
modification to the Credit Agreement;
(ii) this waiver is only for the Borrower's violation of
Section 8.07(v) in connection with the PEI Transaction and
does not constitute a waiver of any other violation of the
Borrower of the Credit Agreement or any other violation of the
Borrower of Section 8.07(v) of the Credit Agreement; and
(iii) the Borrower will use its best efforts to bring
itself into full compliance with Section 8.07(v) of the Credit
Agreement as soon as possible.
6. Entire Agreement. This Agreement sets forth the entire
understanding and agreement of the parties hereto in relation to
the subject matter hereof and supersedes any prior negotiations and
agreements among the parties relative to such subject matter. No
promise, condition, representation or warranty, express or implied,
not herein set forth shall bind any party hereto, and not one of
them has relied on any such promise, condition, representation or
warranty. Each of the parties hereto acknowledges that, except as
in this Agreement otherwise expressly stated, no representations,
warranties or commitments, express or implied, have been made by
any party to the other. None of the terms or conditions of this
Agreement may be changed, modified, waived or canceled orally or
otherwise, except by writing, signed by all the parties hereto,
specifying such change, modification, waiver or cancellation of
such terms or conditions, or of any proceeding or succeeding breach
thereof.
7. Full Force and Effect of Agreement. Except as hereby
specifically amended, modified, waived or supplemented, the Credit
Agreement and all other Loan Documents are hereby confirmed and
ratified in all respects and shall remain in full force and effect
according to their respective terms.
8. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original
as against any party whose signature appears thereon, and all of
which shall together constitute one and the same instrument.
9. Governing Law. This Amendment Agreement shall in all
respects be governed by the laws and judicial decisions of the
state of Tennessee.
10. Enforceability. Should any one or more of the provisions
of this Agreement be determined to be illegal or unenforceable as
to one or more of the parties hereto, all other provisions
nevertheless shall remain effective and binding on the parties
hereto.
11. Credit Agreement. All references in any of the Loan
Documents to the Credit Agreement shall mean the Credit Agreement
as amended and waived hereby.
12. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of each of the Borrower, the Lenders
and the Agent and their respective successors, assigns, and legal
representatives; provided, however, that the Borrower, without the
prior consent of the Agent, may not assign any rights, powers,
duties, or obligations hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their duly authorized officers,
all as of the day and year first above written.
BORROWER:
ATTEST: PROFFITT'S, INC.
By: /s/ Brian J. Martin By: /s/ James E. Glasscock
Name: Brian J. Martin Name: James E. Glasscock
Title:Assistant Secretary Title: Senior Vice President and
Chief Financial Officer
(CORPORATE SEAL)
LENDERS:
NATIONSBANK OF TEXAS,
NATIONAL ASSOCIATION
By:
Name:
Title:
FIRST AMERICAN NATIONAL BANK
By:
Name:
Title:
FIRST TENNESSEE BANK NATIONAL ASSOCIATION
By:
Name:
Title:
TRUST COMPANY BANK
By:
Name:
Title:
By:
Name:
Title:
DEPOSIT GUARANTY NATIONAL BANK
By:
Name:
Title:
HIBERNIA NATIONAL BANK
By:
Name:
Title:
AGENT:
NATIONSBANK OF TEXAS, NATIONAL
ASSOCIATION, as Agent for the Lenders
By:
Name:
Title:
EXHIBIT 10.8
AMENDMENT NO. 1 TO CREDIT FACILITIES
AND REIMBURSEMENT AGREEMENT
THIS AMENDMENT NO. 1 TO CREDIT FACILITIES AND REIMBURSEMENT
AGREEMENT (this "Agreement") is made and entered into as of this
15th day of November, 1994 among:
PROFFITT'S, INC., a Tennessee corporation having its
principal place of business in Alcoa, Tennessee (the "Borrower");
and
Each lender executing and delivering a signature page hereto
(hereinafter such lenders may be referred to individually as a
"Lender" or collectively as the "Lenders"); and
NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION, a national
banking association organized and existing under the laws of the
United States of America ("NationsBank"), in its capacity as
agent for the Lenders (in such capacity, the "Agent");
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders and the Agent have
entered into a Credit Facilities and Reimbursement Agreement
dated as of March 31, 1994 (the "Credit Agreement"), pursuant to
which the Lenders agree to make certain Advances to the Borrower;
and
WHEREAS, the Borrower has requested that the Credit
Agreement be amended in the manner set forth herein and the Agent
and the Lenders are willing to agree to such amendment;
NOW, THEREFORE, in consideration of the mutual covenants and
the fulfillment of the conditions set forth herein, the parties
hereto do hereby agree as follows:
1. DEFINITIONS. Any capitalized terms used herein without
definition shall have the meaning set forth in the Credit
Agreement.
2. AMENDMENT. Subject to the terms and conditions set
forth herein, and in accordance with Section 11.06 of the Credit
Agreement, the Credit Agreement is hereby amended as follows:
(a) The definition of "Consolidated Tangible Net
Worth" in Section 1.01 of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:
Consolidated Tangible Net Worth means at any time as of
which the amount thereof is to be determined,
Consolidated Shareholders' Equity minus the sum of the
following (without duplication of deductions in respect
of items already deducted in arriving at surplus and
retained earnings): the net book value of all assets
which would be treated as intangible assets under
Generally Accepted Accounting Principles, such as
(without limitation) goodwill (whether representing the
excess of cost over book value of assets acquired or
otherwise), capitalized expenses, unamortized debt
discount and expense, consignment inventory rights,
patents, trademarks, trade names, copyrights,
franchises and licenses and all reserves, including
without limitation reserves for depreciation,
depletion, amortization, obsolescence, deferred income
taxes, insurance and inventory valuation; all as
determined on a consolidated basis in accordance with
Generally Accepted Accounting Principles applied on a
Consistent Basis; provided, however, there shall be
included in the determination of Consolidated Tangible
Net Worth, notwithstanding the foregoing, all
adjustments (both increases and decreases) to assets
and liabilities of the Borrower and its Subsidiaries on
a consolidated basis made in connection with and as a
result of the Macco Acquisition and in accordance with
Generally Accepted Accounting Principles;
(b) Section 8.03 of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:
8.03 CONSOLIDATED SENIOR INDEBTEDNESS TO
CONSOLIDATED CAPITALIZATION. Permit at any time during
the periods set forth below the ratio of Consolidated
Senior Indebtedness to Consolidated Capitalization to
be greater than the ratios set forth opposite the
following respective periods:
PERIOD RATIO
Closing Date through April 28, 1995 .45 to 1.00
April 29, 1995 through July 31, 1995 .43 to 1.00
August 1, 1995 through February 2, 1996 .46 to 1.00
February 3, 1996 through May 3, 1996 .40 to 1.00
May 4, 1996 through January 31, 1997 .35 to 1.00
February 1, 1997 and thereafter .30 to 1.00
provided, however, that during each of the third
quarters of Borrower's Fiscal Years ending January 31,
1995 and February 1, 1997 and each Fiscal Year
thereafter, the ratios set forth above shall be
increased by an additional .03 to 1.00 for such third
quarter periods.
(c) Section 8.04 of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:
8.04 CONSOLIDATED FIXED CHARGE RATIO. Permit at
any time during any Four-Quarter Period of the Borrower
ending during the periods set forth below, the
Consolidated Fixed Charge Ratio for such Four-Quarter
Period to be equal to or less than the ratios set forth
opposite the respective periods below:
PERIOD RATIO
Closing Date through April 28, 1995 1.50 to 1.00
April 29, 1995 through May 3, 1996 1.60 to 1.00
May 4, 1996, and thereafter 1.75 to 1.00
(d) Section 8.06 of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:
8.06 CONSOLIDATED FUNDED INDEBTEDNESS TO EBITDA.
Permit at any time the ratio of Consolidated Funded
Indebtedness to Consolidated EBITDA to be equal to or
greater than the following ratios set forth opposite
the following periods below:
PERIOD RATIO
Closing Date through February 2, 1995 4.50 to 1.00
February 3, 1995 through May 3, 1996 3.50 to 1.00
May 4, 1996 and thereafter 3.00 to 1.00
3. REPRESENTATIONS AND WARRANTIES. In order to induce the
Agent and the Lenders to enter into this Agreement, the Borrower
represents and warrants to the Agent and the Lenders as follows:
(a) The representations and warranties made by
Borrower in Article VI of the Credit Agreement are true and
correct on and as of the date hereof;
(b) There has been no material adverse change in the
condition, financial or otherwise, of the Borrower and its
Subsidiaries, taken as a whole, since the date of the most
recent financial reports of the Borrower received by the
Agent and the Lenders under Section 7.01(a) of the Credit
Agreement, other than changes in the ordinary course of
business;
(c) The business and properties of the Borrower and
its Subsidiaries, taken as a whole, are not, and since the
date of the most recent financial report of the Borrower and
its Subsidiaries received by the Agent and the Lenders under
Section 7.01(a) of the Credit Agreement, have not been
adversely affected in any substantial way as the result of
any fire, explosion, earthquake, accident, strike, lockout,
combination of workers, flood, embargo, riot, activities of
armed forces, war or acts of God or the public enemy, or
cancellation or loss of any major contracts; and
(d) No event has occurred and is continuing which
constitutes, and no condition exists which upon the
consummation of the transaction contemplated hereby would
constitute, a Default or an Event of Default on the part of
the Borrower under the Credit Agreement.
4. CONDITIONS PRECEDENT. The effectiveness of this
Agreement is subject to the receipt by the parties hereto of the
following:
(a) The Agent shall have received:
(i) eight (8) counterparts of this Agreement duly
executed by all signatories hereto;
(ii) copies of all additional agreements,
instruments and documents which the Agent may
reasonably request, such documents, when appropriate,
to be certified by appropriate governmental
authorities.
(b) All proceedings of the borrower relating to the
matters provided for herein shall be satisfactory to
the Lenders, the Agent and their counsel.
5. Entire Agreement. This Agreement sets forth the entire
understanding and agreement of the parties hereto in relation to
the subject matter hereof and supersedes any prior negotiations
and agreements among the parties relative to such subject matter.
No promise, condition, representation or warranty, express or
implied, not herein set forth shall bind any party hereto, and
not one of them has relied on any such promise, condition,
representation or warranty. Each of the parties hereto
acknowledges that, except as in this Agreement otherwise
expressly stated, no representations, warranties or commitments,
express or implied, have been made by any party to the other.
None of the terms or conditions of this Agreement may be changed,
modified, waived or canceled orally or otherwise, except by
writing, signed by all the parties hereto, specifying such
change, modification, waiver or cancellation of such terms or
conditions, or of any proceeding or succeeding breach thereof.
6. Full Force and Effect of Agreement. Except as hereby
specifically amended, modified, or supplemented, the Credit
Agreement and all other Loan Documents are hereby confirmed and
ratified in all respects and shall remain in full force and
effect according to their respective terms.
7. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original
as against any party whose signature appears thereon, and all of
which shall together constitute one and the same instrument.
8. Governing Law. This Amendment Agreement shall in all
respects be governed by the laws and judicial decisions of the
state of Tennessee.
9. Enforceability. Should any one or more of the
provisions of this Agreement be determined to be illegal or
unenforceable as to one or more of the parties hereto, all other
provisions nevertheless shall remain effective and binding on the
parties hereto.
10. Credit Agreement. All references in any of the Loan
Documents to the Credit Agreement shall mean the Credit Agreement
as amended hereby.
11. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of each of the Borrower, the
Lenders and the Agent and their respective successors, assigns,
and legal representatives; provided, however, that the Borrower,
without the prior consent of the Agent, may not assign any
rights, powers, duties, or obligations hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their duly authorized officers,
all as of the day and year first above written.
BORROWER:
ATTEST: PROFFITT'S, INC.
By: /s/ Brian J. Martin By: /s/ James E. Glasscock
Name: Brian J. Martin Name: James E. Glasscock
Title:Assistant Secretary Title:Senior Vice President and
Chief Financial Officer
(CORPORATE SEAL)
LENDERS:
NATIONSBANK OF TEXAS,
NATIONAL ASSOCIATION
By:
Name:
Title:
FIRST AMERICAN NATIONAL BANK
By:
Name:
Title:
FIRST TENNESSEE BANK NATIONAL
ASSOCIATION
By:
Name:
Title:
TRUST COMPANY BANK
By:
Name:
Title:
By:
Name:
Title:
DEPOSIT GUARANTY NATIONAL BANK
By:
Name:
Title:
HIBERNIA NATIONAL BANK
By:
Name:
Title:
AGENT:
NATIONSBANK OF TEXAS, NATIONAL
ASSOCIATION, as Agent for the Lenders
By:
Name:
Title:
EXHIBIT 10.11
ENTERPRISE FUNDING CORPORATION
c/o MERRILL LYNCH MONEY MARKETS, INC.
World Financial Center - South Tower
225 Liberty Street
New York, New York 10281
March 31, 1995
Mr. James E. Glasscock
Executive Vice President & CFO
McRae's, Inc.
Highway 80-West
Jackson, Mississippi 39209
Dear Jim:
At your request, Enterprise Funding Corporation (the "Company")
hereby agrees to amend the Transfer and Administration Agreement
between the Company and McRae's, Inc. dated January 27, 1993
(incorporating all amendments to date, the "Agreement") as
follows:
In Section 1.01 of the Agreement, the definition of
Termination Date shall be amended such that the reference to
"March 31, 1996" shall be amended to read "September 30,
1996".
In Section 9.01 of the Agreement, the table in subparagraph
(iii) shall be deleted in its entirety and replaced by the
following:
PERIOD RATIO
Effective Date through
July 28, 1995 1.50 to 1.00
July 29, 1995 through
January 2, 1996 1.55 to 1.00
January 3, 1996 through
May 3, 1996 1.60 to 1.00
May 4, 1996 and thereafter 1.75 to 1.00
In Section 9.01 of the Agreement, the table in subparagraph
(iv) shall be deleted in its entirety and replaced by the
following:
PERIOD RATIO
Effective Date through
January 27, 1995 4.50 to 1.00
January 28, 1995 3.50 to 1.00
January 29, 1995 through
July 28, 1995 3.90 to 1.00
July 29, 1995 through
October 27, 1995 3.70 to 1.00
October 28, 1995 through
February 2, 1996 3.60 to 1.00
February 3, 1996 through
May 3, 1996 3.50 to 1.00
May 4, 1996 and thereafter 3.00 to 1.00
The Transferor hereby represents and warrants that the
representations and warranties of the Transferor set forth in
Section 3.01 of the Agreement are true and correct as of the date
hereof (except those representations and warranties set forth
therein which specifically relate to an earlier date).
All other terms and conditions of the Agreement not amended by
this letter agreement shall remain unchanged and in full force
and effect. This letter agreement shall be effective as of the
date hereof.
Please signify your concurrence with this amendment to the
Agreement by signing the enclosed duplicate original of this
letter and returning it to Michelle M. Heath, NationsBank
Investment Banking, NationsBank Corporate Center - 7th Floor, 100
N. Tryon Street, Charlotte, North Carolina 28255.
Sincerely,
ENTERPRISE FUNDING CORPORATION
By: /s/ Thomas S. Dunstan
Name: Thomas S. Dunstan
Title: Assistant Vice President
ACCEPTED AND AGREED this ______ day of _____________, 1995
McRAE'S, INC.
By: /s/ James E. Glasscock
Name: James E. Glasscock
Title: Executive Vice President & CFO
EXHIBIT 10.45
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement ("Agreement")
is entered into as of the 28th day of March 1995, by and between
Proffitt's, Inc., ("Company"), and R. Brad Martin ("Executive").
Company and Executive agree as follows:
1. Employment. Company hereby employs Executive as Chairman
of the Board and Chief Executive Officer of Company or in such
other capacity with Company and its subsidiaries as Company's Board
of Directors shall designate.
2. Duties. During his employment, Executive shall devote
substantially all of his working time, energies, and skills to the
benefit of Company's business. Executive agrees to serve Company
diligently and to the best of his ability and to use his best
efforts to follow the policies and directions of Company's Board of
Directors.
3. Compensation. Executive's compensation and benefits
under this Agreement shall be as follows:
(a) Base Salary. Company shall pay Executive a base
salary ("Base Salary") at a rate of no less than $450,000 per year
(beginning on April 1, 1995). In addition, the Board of Directors
of Company shall, in good faith, consider granting increases in
such Base Salary based upon such factors as Executive's performance
and the growth and/or profitability of Company. Executive's Base
Salary shall be paid in installments in accordance with Company's
normal payment schedule for its senior management. All payments
shall be subject to the deduction of payroll taxes and similar
assessments as required by law.
(b) Bonus. In addition to the Base Salary, Executive
shall be eligible, as long as he holds the position stated in
paragraph 1, for a yearly cash bonus of up to 50% of Base Salary
based upon his performance in accordance with specific annual
objectives, set in advance, all as approved by the Board of
Directors.
(c) Incentive Compensation. Executive shall be and
hereby is granted a non-qualified option as of March 28, 1995,
("Option") to purchase twenty thousand (20,000) shares of Company
common stock at an option price equal to the closing price of the
stock on March 28, 1995, as reported in the Wall Street Journal.
The Option is granted pursuant to Company's 1994 Long-Term
Incentive Plan ("1994 LTIP"), and shall be subject to the terms and
conditions thereof. The Option shall be exercisable on or after
March 28, 1995, (the "Grant date") to the extent of 20% of the
shares covered thereby; exercisable to the extent of an additional
20% of the shares covered thereby on and after the first
anniversary of the Grant Date; exercisable to the extent of an
additional 20% of the shares covered thereby on and after the
second anniversary of the Grant Date; exercisable to the extent of
an additional 20% of the shares covered thereby on an after the
third anniversary of the Grant Date; and exercisable to the extent
of any remaining shares on and after the fourth anniversary of the
Grant Date; provided, however, that no portion of the Option shall
be exercisable any earlier than six months from the Grant Date.
The Option may be exercised (as provided in the 1994 LTIP) up to
ten (10) years from the Grant Date. Any portion of the Option not
exercised within said ten (10) year period shall expire.
Notwithstanding the preceding paragraph, the Option granted
under this Agreement shall not be exercisable if Executive has been
demoted from the position stated in paragraph 1 or otherwise been
reassigned duties at a lower level in the Company. In the case of
such a demotion or reassignment of duties at a lower position,
Company retains the right to reduce the number of option shares
granted under this Agreement and, in such a case, vesting will
occur as if the reduced number of option shares had been granted on
the Grant Date.
(d) End of Five-Years Service Stock Grant. In
accordance with Executive's prior employment agreements, Company
shall issue to Executive twenty-five thousand (25,000) shares of
common stock as soon as possible after Executive has served the
Company continuously for five years after that commitment was made
to Executive.
(e) Stock Grant. Five thousand (5,000) shares of
Company common stock shall be issued to Executive as soon as
possible after the end of each fiscal year of Company, based upon
targeted annual growth in earnings per share of Company, as
determined by the Board of Directors.
(f) Effect of Change of Control on Options. In the
event of a Change of Control (as defined in the 1994 LTIP) any
Options granted to Executive prior to such Change of Control shall
immediately vest.
4. Insurance and Benefits. Company shall allow Executive to
participate in each employee benefit plan and to receive each
executive benefit that Company provides for persons in Executive's
position.
5. Term. The term of this Agreement shall be for five (5)
years, beginning March 28, 1995, provided, however, that Company
may terminate this Agreement at any time upon thirty (30) days'
prior written notice (at which time this Agreement shall terminate
except for Section 9, which shall continue in effect as set forth
in Section 9). In the event of such termination by Company,
Executive shall be entitled to receive his Base Salary (at the rate
in effect at the time of termination) through the end of the term
of this Agreement. Such Base Salary shall be paid thereafter in
monthly installments. In addition, this Agreement shall terminate
upon the death of executive, except as to Executive's estate's
right to exercise any unexercised stock options pursuant to
Company's stock option plan then in effect, and except as to any
rights which Executive's estate or dependents may have under COBRA
or any other federal or state law or which are derived independent
of this Agreement by reason of his participation in any plan
maintained by Company.
6. Termination by Company for Cause. Company shall have the
right to terminate Executive's employment under this Agreement for
cause, in which event no compensation shall be paid or other
benefits furnished to Executive after termination for cause.
Termination for cause shall be effective immediately upon notice
sent or given to Executive. For purposes of this Agreement, the
term "cause" shall mean and be strictly limited to: (i) conviction
of Executive, after all applicable rights of appeal have been
exhausted or waived, for any crime involving moral turpitude or the
engaging by Executive in any unethical, immoral or fraudulent
conduct which materially discredits Company or is materially
detrimental to the reputation or goodwill of Company; (ii)
commission of any material act of fraud or dishonesty by Executive
against Company, provided that Executive shall first be provided
with written notice of the claim and with an opportunity to contest
said claim before the Board of Directors; or (iii) Executive's
material breach of his obligations under paragraph 2 of the
Agreement, as so determined by the Board of Directors.
(b) In the event that Executive's employment is
terminated, Executive agrees to resign as an officer and/or
director of Company (or any of its subsidiaries or affiliates),
effective as of the date of such termination, and Executive agrees
to return to Company upon such termination any of the following
which contain confidential information: all documents, instruments,
papers, facsimiles, and computerized information which are the
property of Company or such subsidiary or affiliate.
7. Change in Control. If Executive's employment is
terminated primarily as a result of a Change in Control of Company
or a Potential Change in Control of Company as defined below,
Executive shall receive his Base Salary (at the rate in effect at
the time of termination) for a period of two years or through the
end of the term of this Agreement, whichever is longer.
As used herein, the term "Change in Control" means the
happening of any of the following:
(a) Any person or entity, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, other than Company, a subsidiary of Company, or any
employee benefit plan of Company or its subsidiaries, becomes the
beneficial owner of Company's securities having 25 percent or more
of the combined voting power of the then outstanding securities of
Company that may be cast for the election for directors of Company
(other than as a result of an issuance of securities initiated by
Company in the ordinary course of business); or
(b) As the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, less than a majority of the combined voting
power of the then outstanding securities of Company or any
successor corporation or entity entitled to vote generally in the
election of directors of Company or such other corporation or
entity after such transaction, are held in the aggregate by holders
of Company's securities entitled to vote generally in the election
of directors of Company immediately prior to such transactions; or
(c) During any period of two consecutive years,
individuals who at the beginning of any such period constitute the
Board of Directors of Company cease for any reason to constitute at
least a majority thereof, unless the election, or the nomination
for election by Company's stockholders, of each director of Company
first elected during such period was approved by a vote of at least
two-thirds of the directors of Company then still in office who
were directors of Company at the beginning of any such period.
As used herein, the term "Potential Change in Control" means
the happening of any of the following:
(a) The approval by stockholders of an agreement by
Company, the consummation of which would result in a Change of
Control of Company; or
(b) The acquisition of beneficial ownership, directly or
indirectly, by any entity, person or group (other than Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
Company or its subsidiaries (including any trustee of such plan
acting as trustee) of securities of Company representing 5 percent
or more of the combined voting power of Company's outstanding
securities and the adoption by the Board of Directors of Company of
a resolution to the effect that a Potential Change in Control of
Company has occurred for purposes of this Plan.
8. Disability. If Executive becomes Disabled at any time
during the term of this Agreement, he shall after he becomes
disabled continue to receive all payments and benefits provided
under the terms of this Agreement for a period of twelve
consecutive months, or for the remaining term of this Agreement,
whichever period is shorter. In the event that Executive is
disabled for more than twelve consecutive months during the term of
this Agreement, executive shall, at the expiration of the initial
twelve consecutive month period, be entitled to receive under this
Agreement 50% of his Base Salary plus the insurance and benefits
described in Section 4 of this Agreement for the remaining term of
this Agreement. For purposes of this Agreement, the term disabled
shall mean the inability of Executive (as the result of a physical
or mental condition) to perform the duties of his position under
this Agreement with reasonable accommodation and which inability is
reasonably expected to last at least one (1) full year.
9. Non-competition; Unauthorized Disclosure.
(a) Non-competition. During the period Executive is
employed under this Agreement, and for a period of one year
thereafter, Executive:
(i) shall not engage in any activities, whether as
employer, proprietor, partner, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of
which are traded on a national securities exchange or in the
over-the-counter market, director, officer, employee or otherwise,
in competition with (i) the businesses conducted at the date hereof
by Company or any subsidiary or affiliate, or (ii) any business in
which Company or any subsidiary or affiliate is substantially
engaged at any time during the employment period;
(ii) shall not solicit, in competition with
Company, any person who is a customer of the businesses conducted
by Company at the date hereof or of any business in which Company
is substantially engaged at any time during the term of this
Agreement; and
(iii) shall not induce or attempt to persuade any
employee of Company or any of its divisions, subsidiaries or then
present affiliates to terminate his or her employment relationship
in order to enter into competitive employment.
(b) Unauthorized Disclosure. During the period
Executive is employed under this Agreement, and for a further
period of two years thereafter, Executive shall not, except as
required by any court or administrative agency, without the written
consent of the Board of Directors, or a person authorized thereby,
disclose to any person, other than an employee of Company or a
person to whom disclosure is reasonably necessary or appropriate in
connection with the performance by Executive of his duties as an
executive for Company, any confidential information obtained by him
while in the employ of Company; provided, however, that
confidential information shall not include any information now
known or which becomes known generally to the public (other than as
a result of unauthorized disclosure by Executive).
(c) Scope of Covenants; Remedies. The following
provisions shall apply to the covenants of Executive contained in
this Section 9:
(i) the covenants contained in paragraph (i) and
(ii) of Section 9(a) shall apply within all the territories in
which Company is actively engaged in the conduct of business while
Executive is employed under this Agreement, including, without
limitation, the territories in which customers are then being
solicited;
(ii) without limiting the right of Company to
pursue all other legal and equitable remedies available for
violation by Executive of the covenants contained in this Section
9, it is expressly agreed by Executive and Company that such other
remedies cannot fully compensate Company for any such violation and
that Company shall be entitled to injunctive relief to prevent any
such violation or any continuing violation thereof;
(iii) each party intends and agrees that if, in any
action before any court or agency legally empowered to enforce the
covenants contained in this Section 9, any term, restriction,
covenant or promise contained therein is found to be unreasonable
and accordingly unenforceable, then such term, restriction,
covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency; and
(iv) the covenants contained in this Section 9
shall survive the conclusion of Executive's employment by Company.
10. General Provisions.
(a) Notices. Any notice to be given hereunder by either
party to the other may be effected by personal delivery, in writing
or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the
parties at the addresses set forth below, but each party may change
his or its address by written notice in accordance with this
Section 10 (a). Notices shall be deemed communicated as of the
actual receipt or refusal of receipt.
If to Executive: R. Brad Martin
5148 Shelby Oaks Drive
Memphis, TN 38134
If to Company: Proffitt's, Inc.
Post Office Box 9388
Alcoa, TN 37701
(b) Partial Invalidity. If any provision in this
Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remaining provisions shall,
nevertheless, continue in full force and without being impaired or
invalidated in any way.
(c) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Tennessee.
(d) Attorney's Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements in addition to
any other relief to which he or it may be entitled.
(e) Delegation of Duties. Executive may not delegate or
assign any of his duties or obligations hereunder and Company shall
have no right to assign this Agreement without Executive's express
written consent to such assignment. This Agreement shall inure to
the benefit of and bind the parties hereto and their respective
legal representatives, successors and assigns.
(f) Entire Agreement. Except for any prior grants of
options or other forms of incentive compensation evidenced by a
written instrument, this Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to employment of Executive by Company and contains all
of the covenants and agreements between the parties with respect to
such employment. Each party to this Agreement acknowledges that no
representations, inducements or agreements, oral or otherwise, that
have not been embodied herein, and no other agreement, statement or
promise not contained in this Agreement, shall be valid or binding.
Any modification of this Agreement will be effective only if it is
in writing signed by the party to be charged.
(g) No Conflicting Agreement. By signing this
Agreement, Executive warrants that he is not a party to any
restrictive covenant, agreement or contract which limits the
performance of his duties and responsibilities under this Agreement
or under which such performance would constitute a breach.
(h) Headings. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define
or limit the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PROFFITT'S, INC.
BY: /s/ James A. Coggin
James A. Coggin
President
/s/ Julia A. Bentley
Julia A. Bentley
Secretary
/s/ R. Brad Martin
R. Brad Martin
Executive
EXHIBIT 10.46
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement ("Agreement")
is entered into as of the 28th day of March 1995, by and between
Proffitt's, Inc., ("Company"), and James A. Coggin ("Executive").
Company and Executive agree as follows:
1. Employment. Company hereby employs Executive as President
of Company or in such other capacity with Company and its
subsidiaries as Company's Board of Directors shall designate.
2. Duties. During his employment, Executive shall devote
substantially all of his working time, energies, and skills to the
benefit of Company's business. Executive agrees to serve Company
diligently and to the best of his ability and to use his best
efforts to follow the policies and directions of Company's Board of
Directors.
3. Compensation. Executive's compensation and benefits
under this Agreement shall be as follows:
(a) Base Salary. Company shall pay Executive a base
salary ("Base Salary") at a rate of no less than $365,000 per year
(beginning on April 1, 1995). In addition, the Board of Directors
of Company shall, in good faith, consider granting increases in
such Base Salary based upon such factors as Executive's performance
and the growth and/or profitability of Company. Executive's Base
Salary shall be paid in installments in accordance with Company's
normal payment schedule for its senior management. All payments
shall be subject to the deduction of payroll taxes and similar
assessments as required by law.
(b) Bonus. In addition to the Base Salary, Executive
shall be eligible, as long as he holds the position stated in
paragraph 1, for a yearly cash bonus of up to 50% of Base Salary
based upon his performance in accordance with specific annual
objectives, set in advance, all as approved by the Board of
Directors.
(c) Incentive Compensation. Executive shall be and
hereby is granted a non-qualified option as of March 28, 1995,
("Option") to purchase twenty thousand (20,000) shares of Company
common stock at an option price equal to the closing price of the
stock on March 28, 1995, as reported in the Wall Street Journal.
The Option is granted pursuant to Company's 1994 Long-Term
Incentive Plan ("1994 LTIP"), and shall be subject to the terms and
conditions thereof. The Option shall be exercisable on or after
March 28, 1995, (the "Grant date") to the extent of 20% of the
shares covered thereby; exercisable to the extent of an additional
20% of the shares covered thereby on and after the first
anniversary of the Grant Date; exercisable to the extent of an
additional 20% of the shares covered thereby on and after the
second anniversary of the Grant Date; exercisable to the extent of
an additional 20% of the shares covered thereby on an after the
third anniversary of the Grant Date; and exercisable to the extent
of any remaining shares on and after the fourth anniversary of the
Grant Date; provided, however, that no portion of the Option shall
be exercisable any earlier than six months from the Grant Date.
The Option may be exercised (as provided in the 1994 LTIP) up to
ten (10) years from the Grant Date. Any portion of the Option not
exercised within said ten (10) year period shall expire.
Notwithstanding the preceding paragraph, the Option granted
under this Agreement shall not be exercisable if Executive has been
demoted from the position stated in paragraph 1 or otherwise been
reassigned duties at a lower level in the Company. In the case of
such a demotion or reassignment of duties at a lower position,
Company retains the right to reduce the number of option shares
granted under this Agreement and, in such a case, vesting will
occur as if the reduced number of option shares had been granted on
the Grant Date.
(d) Stock Grant. Up to two thousand five hundred
(2,500) shares of Company common stock shall be issued to Executive
as soon as possible after the end of each fiscal year of Company,
based upon targeted annual growth in earnings per share of Company,
as determined by the Board of Directors.
(e) Effect of Change of Control on Options. In the
event of a Change of Control (as defined in the 1994 LTIP) any
Options granted to Executive prior to such Change of Control shall
immediately vest.
4. Insurance and Benefits. Company shall allow Executive to
participate in each employee benefit plan and to receive each
executive benefit that Company provides for persons in Executive's
position.
5. Term. The term of this Agreement shall be for three (3)
years, beginning March 28, 1995, provided, however, that Company
may terminate this Agreement at any time upon thirty (30) days'
prior written notice (at which time this Agreement shall terminate
except for Section 9, which shall continue in effect as set forth
in Section 9). In the event of such termination by Company,
Executive shall be entitled to receive his Base Salary (at the rate
in effect at the time of termination) through the end of the term
of this Agreement. Such Base Salary shall be paid thereafter in
monthly installments. In addition, this Agreement shall terminate
upon the death of executive, except as to Executive's estate's
right to exercise any unexercised stock options pursuant to
Company's stock option plan then in effect, and except as to any
rights which Executive's estate or dependents may have under COBRA
or any other federal or state law or which are derived independent
of this Agreement by reason of his participation in any plan
maintained by Company.
6. Termination by Company for Cause. Company shall have the
right to terminate Executive's employment under this Agreement for
cause, in which event no compensation shall be paid or other
benefits furnished to Executive after termination for cause.
Termination for cause shall be effective immediately upon notice
sent or given to Executive. For purposes of this Agreement, the
term "cause" shall mean and be strictly limited to: (i) conviction
of Executive, after all applicable rights of appeal have been
exhausted or waived, for any crime involving moral turpitude or the
engaging by Executive in any unethical, immoral or fraudulent
conduct which materially discredits Company or is materially
detrimental to the reputation or goodwill of Company; (ii)
commission of any material act of fraud or dishonesty by Executive
against Company, provided that Executive shall first be provided
with written notice of the claim and with an opportunity to contest
said claim before the Board of Directors; or (iii) Executive's
material breach of his obligations under paragraph 2 of the
Agreement, as so determined by the Board of Directors.
(b) In the event that Executive's employment is
terminated, Executive agrees to resign as an officer and/or
director of Company (or any of its subsidiaries or affiliates),
effective as of the date of such termination, and Executive agrees
to return to Company upon such termination any of the following
which contain confidential information: all documents, instruments,
papers, facsimiles, and computerized information which are the
property of Company or such subsidiary or affiliate.
7. Change in Control. If Executive's employment is
terminated primarily as a result of a Change in Control of Company
or a Potential Change in Control of Company as defined below,
Executive shall receive his Base Salary (at the rate in effect at
the time of termination) for a period of two years or through the
end of the term of this Agreement, whichever is longer.
As used herein, the term "Change in Control" means the
happening of any of the following:
(a) Any person or entity, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, other than Company, a subsidiary of Company, or any
employee benefit plan of Company or its subsidiaries, becomes the
beneficial owner of Company's securities having 25 percent or more
of the combined voting power of the then outstanding securities of
Company that may be cast for the election for directors of Company
(other than as a result of an issuance of securities initiated by
Company in the ordinary course of business); or
(b) As the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, less than a majority of the combined voting
power of the then outstanding securities of Company or any
successor corporation or entity entitled to vote generally in the
election of directors of Company or such other corporation or
entity after such transaction, are held in the aggregate by holders
of Company's securities entitled to vote generally in the election
of directors of Company immediately prior to such transactions; or
(c) During any period of two consecutive years,
individuals who at the beginning of any such period constitute the
Board of Directors of Company cease for any reason to constitute at
least a majority thereof, unless the election, or the nomination
for election by Company's stockholders, of each director of Company
first elected during such period was approved by a vote of at least
two-thirds of the directors of Company then still in office who
were directors of Company at the beginning of any such period.
As used herein, the term "Potential Change in Control" means
the happening of any of the following:
(a) The approval by stockholders of an agreement by
Company, the consummation of which would result in a Change of
Control of Company; or
(b) The acquisition of beneficial ownership, directly or
indirectly, by any entity, person or group (other than Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
Company or its subsidiaries (including any trustee of such plan
acting as trustee) of securities of Company representing 5 percent
or more of the combined voting power of Company's outstanding
securities and the adoption by the Board of Directors of Company of
a resolution to the effect that a Potential Change in Control of
Company has occurred for purposes of this Plan.
8. Disability. If Executive becomes Disabled at any time
during the term of this Agreement, he shall after he becomes
disabled continue to receive all payments and benefits provided
under the terms of this Agreement for a period of twelve
consecutive months, or for the remaining term of this Agreement,
whichever period is shorter. In the event that Executive is
disabled for more than twelve consecutive months during the term of
this Agreement, executive shall, at the expiration of the initial
twelve consecutive month period, be entitled to receive under this
Agreement 50% of his Base Salary plus the insurance and benefits
described in Section 4 of this Agreement for the remaining term of
this Agreement. For purposes of this Agreement, the term disabled
shall mean the inability of Executive (as the result of a physical
or mental condition) to perform the duties of his position under
this Agreement with reasonable accommodation and which inability is
reasonably expected to last at least one (1) full year.
9. Non-competition; Unauthorized Disclosure.
(a) Non-competition. During the period Executive is
employed under this Agreement, and for a period of one year
thereafter, Executive:
(i) shall not engage in any activities, whether as
employer, proprietor, partner, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of
which are traded on a national securities exchange or in the
over-the-counter market, director, officer, employee or otherwise,
in competition with (i) the businesses conducted at the date hereof
by Company or any subsidiary or affiliate, or (ii) any business in
which Company or any subsidiary or affiliate is substantially
engaged at any time during the employment period;
(ii) shall not solicit, in competition with
Company, any person who is a customer of the businesses conducted
by Company at the date hereof or of any business in which Company
is substantially engaged at any time during the term of this
Agreement; and
(iii) shall not induce or attempt to persuade any
employee of Company or any of its divisions, subsidiaries or then
present affiliates to terminate his or her employment relationship
in order to enter into competitive employment.
(b) Unauthorized Disclosure. During the period
Executive is employed under this Agreement, and for a further
period of two years thereafter, Executive shall not, except as
required by any court or administrative agency, without the written
consent of the Board of Directors, or a person authorized thereby,
disclose to any person, other than an employee of Company or a
person to whom disclosure is reasonably necessary or appropriate in
connection with the performance by Executive of his duties as an
executive for Company, any confidential information obtained by him
while in the employ of Company; provided, however, that
confidential information shall not include any information now
known or which becomes known generally to the public (other than as
a result of unauthorized disclosure by Executive).
(c) Scope of Covenants; Remedies. The following
provisions shall apply to the covenants of Executive contained in
this Section 9:
(i) the covenants contained in paragraph (i) and
(ii) of Section 9(a) shall apply within all the territories in
which Company is actively engaged in the conduct of business while
Executive is employed under this Agreement, including, without
limitation, the territories in which customers are then being
solicited;
(ii) without limiting the right of Company to
pursue all other legal and equitable remedies available for
violation by Executive of the covenants contained in this Section
9, it is expressly agreed by Executive and Company that such other
remedies cannot fully compensate Company for any such violation and
that Company shall be entitled to injunctive relief to prevent any
such violation or any continuing violation thereof;
(iii) each party intends and agrees that if, in any
action before any court or agency legally empowered to enforce the
covenants contained in this Section 9, any term, restriction,
covenant or promise contained therein is found to be unreasonable
and accordingly unenforceable, then such term, restriction,
covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency; and
(iv) the covenants contained in this Section 9
shall survive the conclusion of Executive's employment by Company.
10. General Provisions.
(a) Notices. Any notice to be given hereunder by either
party to the other may be effected by personal delivery, in writing
or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the
parties at the addresses set forth below, but each party may change
his or its address by written notice in accordance with this
Section 10 (a). Notices shall be deemed communicated as of the
actual receipt or refusal of receipt.
If to Executive: James A. Coggin
5430 Charter Oak Place
Jackson, MS 39211
If to Company: Proffitt's, Inc.
Post Office Box 9388
Alcoa, TN 37701
(b) Partial Invalidity. If any provision in this
Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remaining provisions shall,
nevertheless, continue in full force and without being impaired or
invalidated in any way.
(c) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Tennessee.
(d) Attorney's Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements in addition to
any other relief to which he or it may be entitled.
(e) Delegation of Duties. Executive may not delegate or
assign any of his duties or obligations hereunder and Company shall
have no right to assign this Agreement without Executive's express
written consent to such assignment. This Agreement shall inure to
the benefit of and bind the parties hereto and their respective
legal representatives, successors and assigns.
(f) Entire Agreement. Except for any prior grants of
options or other forms of incentive compensation evidenced by a
written instrument, this Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to employment of Executive by Company and contains all
of the covenants and agreements between the parties with respect to
such employment. Each party to this Agreement acknowledges that no
representations, inducements or agreements, oral or otherwise, that
have not been embodied herein, and no other agreement, statement or
promise not contained in this Agreement, shall be valid or binding.
Any modification of this Agreement will be effective only if it is
in writing signed by the party to be charged.
(g) No Conflicting Agreement. By signing this
Agreement, Executive warrants that he is not a party to any
restrictive covenant, agreement or contract which limits the
performance of his duties and responsibilities under this Agreement
or under which such performance would constitute a breach.
(h) Headings. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define
or limit the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PROFFITT'S, INC.
BY: /s/ R. Brad Martin
R. Brad Martin
Chairman and Chief
Executive Officer
/s/ James A. Coggin
James A. Coggin
Executive
EXHIBIT 10.47
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement ("Agreement")
is entered into as of the 28th day of March 1995, by and between
Proffitt's, Inc., ("Company"), and James E. Glasscock
("Executive").
Company and Executive agree as follows:
1. Employment. Company hereby employs Executive as Executive
Vice President and Chief Financial Officer of Company or in such
other capacity with Company and its subsidiaries as Company's Board
of Directors shall designate.
2. Duties. During his employment, Executive shall devote
substantially all of his working time, energies, and skills to the
benefit of Company's business. Executive agrees to serve Company
diligently and to the best of his ability and to use his best
efforts to follow the policies and directions of Company's Board of
Directors.
3. Compensation. Executive's compensation and benefits
under this Agreement shall be as follows:
(a) Base Salary. Company shall pay Executive a base
salary ("Base Salary") at a rate of no less than $215,000 per year
(beginning on April 1, 1995). In addition, the Board of Directors
of Company shall, in good faith, consider granting increases in
such Base Salary based upon such factors as Executive's performance
and the growth and/or profitability of Company. Executive's Base
Salary shall be paid in installments in accordance with Company's
normal payment schedule for its senior management. All payments
shall be subject to the deduction of payroll taxes and similar
assessments as required by law.
(b) Bonus. In addition to the Base Salary, Executive
shall be eligible, as long as he holds the position stated in
paragraph 1, for a yearly cash bonus of up to 50% of Base Salary
based upon his performance in accordance with specific annual
objectives, set in advance, all as approved by the Board of
Directors.
(c) Incentive Compensation. Executive shall be and
hereby is granted a non-qualified option as of March 28, 1995,
("Option") to purchase fifteen thousand (15,000) shares of Company
common stock at an option price equal to the closing price of the
stock on March 28, 1995, as reported in the Wall Street Journal.
The Option is granted pursuant to Company's 1994 Long-Term
Incentive Plan ("1994 LTIP"), and shall be subject to the terms and
conditions thereof. The Option shall be exercisable on or after
March 28, 1995, (the "Grant date") to the extent of 20% of the
shares covered thereby; exercisable to the extent of an additional
20% of the shares covered thereby on and after the first
anniversary of the Grant Date; exercisable to the extent of an
additional 20% of the shares covered thereby on and after the
second anniversary of the Grant Date; exercisable to the extent of
an additional 20% of the shares covered thereby on an after the
third anniversary of the Grant Date; and exercisable to the extent
of any remaining shares on and after the fourth anniversary of the
Grant Date; provided, however, that no portion of the Option shall
be exercisable any earlier than six months from the Grant Date.
The Option may be exercised (as provided in the 1994 LTIP) up to
ten (10) years from the Grant Date. Any portion of the Option not
exercised within said ten (10) year period shall expire.
Notwithstanding the preceding paragraph, the Option granted
under this Agreement shall not be exercisable if Executive has been
demoted from the position stated in paragraph 1 or otherwise been
reassigned duties at a lower level in the Company. In the case of
such a demotion or reassignment of duties at a lower position,
Company retains the right to reduce the number of option shares
granted under this Agreement and, in such a case, vesting will
occur as if the reduced number of option shares had been granted on
the Grant Date.
(d) Effect of Change of Control on Options. In the
event of a Change of Control (as defined in the 1994 LTIP) any
Options granted to Executive prior to such Change of Control shall
immediately vest.
4. Insurance and Benefits. Company shall allow Executive to
participate in each employee benefit plan and to receive each
executive benefit that Company provides for persons in Executive's
position.
5. Term. The term of this Agreement shall be for three (3)
years, beginning March 28, 1995, provided, however, that Company
may terminate this Agreement at any time upon thirty (30) days'
prior written notice (at which time this Agreement shall terminate
except for Section 9, which shall continue in effect as set forth
in Section 9). In the event of such termination by Company,
Executive shall be entitled to receive his Base Salary (at the rate
in effect at the time of termination) through the end of the term
of this Agreement. Such Base Salary shall be paid thereafter in
monthly installments. In addition, this Agreement shall terminate
upon the death of executive, except as to Executive's estate's
right to exercise any unexercised stock options pursuant to
Company's stock option plan then in effect, and except as to any
rights which Executive's estate or dependents may have under COBRA
or any other federal or state law or which are derived independent
of this Agreement by reason of his participation in any plan
maintained by Company.
6. Termination by Company for Cause. Company shall have the
right to terminate Executive's employment under this Agreement for
cause, in which event no compensation shall be paid or other
benefits furnished to Executive after termination for cause.
Termination for cause shall be effective immediately upon notice
sent or given to Executive. For purposes of this Agreement, the
term "cause" shall mean and be strictly limited to: (i) conviction
of Executive, after all applicable rights of appeal have been
exhausted or waived, for any crime involving moral turpitude or the
engaging by Executive in any unethical, immoral or fraudulent
conduct which materially discredits Company or is materially
detrimental to the reputation or goodwill of Company; (ii)
commission of any material act of fraud or dishonesty by Executive
against Company, provided that Executive shall first be provided
with written notice of the claim and with an opportunity to contest
said claim before the Board of Directors; or (iii) Executive's
material breach of his obligations under paragraph 2 of the
Agreement, as so determined by the Board of Directors.
(b) In the event that Executive's employment is
terminated, Executive agrees to resign as an officer and/or
director of Company (or any of its subsidiaries or affiliates),
effective as of the date of such termination, and Executive agrees
to return to Company upon such termination any of the following
which contain confidential information: all documents, instruments,
papers, facsimiles, and computerized information which are the
property of Company or such subsidiary or affiliate.
7. Change in Control. If Executive's employment is
terminated primarily as a result of a Change in Control of Company
or a Potential Change in Control of Company as defined below,
Executive shall receive his Base Salary (at the rate in effect at
the time of termination) for a period of two years or through the
end of the term of this Agreement, whichever is longer.
As used herein, the term "Change in Control" means the
happening of any of the following:
(a) Any person or entity, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, other than Company, a subsidiary of Company, or any
employee benefit plan of Company or its subsidiaries, becomes the
beneficial owner of Company's securities having 25 percent or more
of the combined voting power of the then outstanding securities of
Company that may be cast for the election for directors of Company
(other than as a result of an issuance of securities initiated by
Company in the ordinary course of business); or
(b) As the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, less than a majority of the combined voting
power of the then outstanding securities of Company or any
successor corporation or entity entitled to vote generally in the
election of directors of Company or such other corporation or
entity after such transaction, are held in the aggregate by holders
of Company's securities entitled to vote generally in the election
of directors of Company immediately prior to such transactions; or
(c) During any period of two consecutive years,
individuals who at the beginning of any such period constitute the
Board of Directors of Company cease for any reason to constitute at
least a majority thereof, unless the election, or the nomination
for election by Company's stockholders, of each director of Company
first elected during such period was approved by a vote of at least
two-thirds of the directors of Company then still in office who
were directors of Company at the beginning of any such period.
As used herein, the term "Potential Change in Control" means
the happening of any of the following:
(a) The approval by stockholders of an agreement by
Company, the consummation of which would result in a Change of
Control of Company; or
(b) The acquisition of beneficial ownership, directly or
indirectly, by any entity, person or group (other than Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
Company or its subsidiaries (including any trustee of such plan
acting as trustee) of securities of Company representing 5 percent
or more of the combined voting power of Company's outstanding
securities and the adoption by the Board of Directors of Company of
a resolution to the effect that a Potential Change in Control of
Company has occurred for purposes of this Plan.
8. Disability. If Executive becomes Disabled at any time
during the term of this Agreement, he shall after he becomes
disabled continue to receive all payments and benefits provided
under the terms of this Agreement for a period of twelve
consecutive months, or for the remaining term of this Agreement,
whichever period is shorter. In the event that Executive is
disabled for more than twelve consecutive months during the term of
this Agreement, executive shall, at the expiration of the initial
twelve consecutive month period, be entitled to receive under this
Agreement 50% of his Base Salary plus the insurance and benefits
described in Section 4 of this Agreement for the remaining term of
this Agreement. For purposes of this Agreement, the term disabled
shall mean the inability of Executive (as the result of a physical
or mental condition) to perform the duties of his position under
this Agreement with reasonable accommodation and which inability is
reasonably expected to last at least one (1) full year.
9. Non-competition; Unauthorized Disclosure.
(a) Non-competition. During the period Executive is
employed under this Agreement, and for a period of one year
thereafter, Executive:
(i) shall not engage in any activities, whether as
employer, proprietor, partner, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of
which are traded on a national securities exchange or in the
over-the-counter market, director, officer, employee or otherwise,
in competition with (i) the businesses conducted at the date hereof
by Company or any subsidiary or affiliate, or (ii) any business in
which Company or any subsidiary or affiliate is substantially
engaged at any time during the employment period;
(ii) shall not solicit, in competition with
Company, any person who is a customer of the businesses conducted
by Company at the date hereof or of any business in which Company
is substantially engaged at any time during the term of this
Agreement; and
(iii) shall not induce or attempt to persuade any
employee of Company or any of its divisions, subsidiaries or then
present affiliates to terminate his or her employment relationship
in order to enter into competitive employment.
(b) Unauthorized Disclosure. During the period
Executive is employed under this Agreement, and for a further
period of two years thereafter, Executive shall not, except as
required by any court or administrative agency, without the written
consent of the Board of Directors, or a person authorized thereby,
disclose to any person, other than an employee of Company or a
person to whom disclosure is reasonably necessary or appropriate in
connection with the performance by Executive of his duties as an
executive for Company, any confidential information obtained by him
while in the employ of Company; provided, however, that
confidential information shall not include any information now
known or which becomes known generally to the public (other than as
a result of unauthorized disclosure by Executive).
(c) Scope of Covenants; Remedies. The following
provisions shall apply to the covenants of Executive contained in
this Section 9:
(i) the covenants contained in paragraph (i) and
(ii) of Section 9(a) shall apply within all the territories in
which Company is actively engaged in the conduct of business while
Executive is employed under this Agreement, including, without
limitation, the territories in which customers are then being
solicited;
(ii) without limiting the right of Company to
pursue all other legal and equitable remedies available for
violation by Executive of the covenants contained in this Section
9, it is expressly agreed by Executive and Company that such other
remedies cannot fully compensate Company for any such violation and
that Company shall be entitled to injunctive relief to prevent any
such violation or any continuing violation thereof;
(iii) each party intends and agrees that if, in any
action before any court or agency legally empowered to enforce the
covenants contained in this Section 9, any term, restriction,
covenant or promise contained therein is found to be unreasonable
and accordingly unenforceable, then such term, restriction,
covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency; and
(iv) the covenants contained in this Section 9
shall survive the conclusion of Executive's employment by Company.
10. General Provisions.
(a) Notices. Any notice to be given hereunder by either
party to the other may be effected by personal delivery, in writing
or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the
parties at the addresses set forth below, but each party may change
his or its address by written notice in accordance with this
Section 10 (a). Notices shall be deemed communicated as of the
actual receipt or refusal of receipt.
If to Executive: James E. Glasscock
701 Pine Valley
Jackson, MS 39208
If to Company: Proffitt's, Inc.
Post Office Box 9388
Alcoa, TN 37701
(b) Partial Invalidity. If any provision in this
Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remaining provisions shall,
nevertheless, continue in full force and without being impaired or
invalidated in any way.
(c) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Tennessee.
(d) Attorney's Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements in addition to
any other relief to which he or it may be entitled.
(e) Delegation of Duties. Executive may not delegate or
assign any of his duties or obligations hereunder and Company shall
have no right to assign this Agreement without Executive's express
written consent to such assignment. This Agreement shall inure to
the benefit of and bind the parties hereto and their respective
legal representatives, successors and assigns.
(f) Entire Agreement. Except for any prior grants of
options or other forms of incentive compensation evidenced by a
written instrument, this Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to employment of Executive by Company and contains all
of the covenants and agreements between the parties with respect to
such employment. Each party to this Agreement acknowledges that no
representations, inducements or agreements, oral or otherwise, that
have not been embodied herein, and no other agreement, statement or
promise not contained in this Agreement, shall be valid or binding.
Any modification of this Agreement will be effective only if it is
in writing signed by the party to be charged.
(g) No Conflicting Agreement. By signing this
Agreement, Executive warrants that he is not a party to any
restrictive covenant, agreement or contract which limits the
performance of his duties and responsibilities under this Agreement
or under which such performance would constitute a breach.
(h) Headings. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define
or limit the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PROFFITT'S, INC.
BY: /s/ R. Brad Martin
R. Brad Martin
Chairman of the Board
/s/ James E. Glasscock
James E. Glasscock
Executive
EXHIBIT 10.48
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement ("Agreement")
is entered into as of the 28th day of March 1995, by and between
Proffitt's, Inc., ("Company"), and Frederick J. Mershad
("Executive").
Company and Executive agree as follows:
1. Employment. Company hereby employs Executive as President
of the Proffitt's Stores Division of Company or in such other
capacity with Company and its subsidiaries as Company's Board of
Directors shall designate.
2. Duties. During his employment, Executive shall devote
substantially all of his working time, energies, and skills to the
benefit of Company's business. Executive agrees to serve Company
diligently and to the best of his ability and to use his best
efforts to follow the policies and directions of Company's Board of
Directors.
3. Compensation. Executive's compensation and benefits
under this Agreement shall be as follows:
(a) Base Salary. Company shall pay Executive a base
salary ("Base Salary") at a rate of no less than $275,000 per year
(beginning on April 1, 1995). In addition, the Board of Directors
of Company shall, in good faith, consider granting increases in
such Base Salary based upon such factors as Executive's performance
and the growth and/or profitability of Company. Executive's Base
Salary shall be paid in installments in accordance with Company's
normal payment schedule for its senior management. All payments
shall be subject to the deduction of payroll taxes and similar
assessments as required by law.
(b) Bonus. In addition to the Base Salary, Executive
shall be eligible, as long as he holds the position stated in
paragraph 1, for a yearly cash bonus of up to 40% of Base Salary
based upon his performance in accordance with specific annual
objectives, set in advance, all as approved by the Board of
Directors.
(c) Incentive Compensation. Executive shall be and
hereby is granted a non-qualified option as of March 28, 1995,
("Option") to purchase fifteen thousand (15,000) shares of Company
common stock at an option price equal to the closing price of the
stock on March 28, 1995, as reported in the Wall Street Journal.
The Option is granted pursuant to Company's 1994 Long-Term
Incentive Plan ("1994 LTIP"), and shall be subject to the terms and
conditions thereof. The Option shall be exercisable on or after
March 28, 1995, (the "Grant date") to the extent of 20% of the
shares covered thereby; exercisable to the extent of an additional
20% of the shares covered thereby on and after the first
anniversary of the Grant Date; exercisable to the extent of an
additional 20% of the shares covered thereby on and after the
second anniversary of the Grant Date; exercisable to the extent of
an additional 20% of the shares covered thereby on an after the
third anniversary of the Grant Date; and exercisable to the extent
of any remaining shares on and after the fourth anniversary of the
Grant Date; provided, however, that no portion of the Option shall
be exercisable any earlier than six months from the Grant Date.
The Option may be exercised (as provided in the 1994 LTIP) up to
ten (10) years from the Grant Date. Any portion of the Option not
exercised within said ten (10) year period shall expire.
Notwithstanding the preceding paragraph, the Option granted
under this Agreement shall not be exercisable if Executive has been
demoted from the position stated in paragraph 1 or otherwise been
reassigned duties at a lower level in the Company. In the case of
such a demotion or reassignment of duties at a lower position,
Company retains the right to reduce the number of option shares
granted under this Agreement and, in such a case, vesting will
occur as if the reduced number of option shares had been granted on
the Grant Date.
(d) Stock Grant. Ten thousand (10,000) shares of
Company common stock shall be issued to Executive as soon as
possible after he has been employed by Company for three full,
consecutive years.
(e) Effect of Change of Control on Options. In the
event of a Change of Control (as defined in the 1994 LTIP) any
Options granted to Executive prior to such Change of Control shall
immediately vest.
4. Insurance and Benefits. Company shall allow Executive to
participate in each employee benefit plan and to receive each
executive benefit that Company provides for persons in Executive's
position.
5. Term. The term of this Agreement shall be for three (3)
years, beginning March 28, 1995, provided, however, that Company
may terminate this Agreement at any time upon thirty (30) days'
prior written notice (at which time this Agreement shall terminate
except for Section 9, which shall continue in effect as set forth
in Section 9). In the event of such termination by Company,
Executive shall be entitled to receive his Base Salary (at the rate
in effect at the time of termination) through the end of the term
of this Agreement. Such Base Salary shall be paid thereafter in
monthly installments. In addition, this Agreement shall terminate
upon the death of executive, except as to Executive's estate's
right to exercise any unexercised stock options pursuant to
Company's stock option plan then in effect, and except as to any
rights which Executive's estate or dependents may have under COBRA
or any other federal or state law or which are derived independent
of this Agreement by reason of his participation in any plan
maintained by Company.
6. Termination by Company for Cause. Company shall have the
right to terminate Executive's employment under this Agreement for
cause, in which event no compensation shall be paid or other
benefits furnished to Executive after termination for cause.
Termination for cause shall be effective immediately upon notice
sent or given to Executive. For purposes of this Agreement, the
term "cause" shall mean and be strictly limited to: (i) conviction
of Executive, after all applicable rights of appeal have been
exhausted or waived, for any crime involving moral turpitude or the
engaging by Executive in any unethical, immoral or fraudulent
conduct which materially discredits Company or is materially
detrimental to the reputation or goodwill of Company; (ii)
commission of any material act of fraud or dishonesty by Executive
against Company, provided that Executive shall first be provided
with written notice of the claim and with an opportunity to contest
said claim before the Board of Directors; or (iii) Executive's
material breach of his obligations under paragraph 2 of the
Agreement, as so determined by the Board of Directors.
(b) In the event that Executive's employment is
terminated, Executive agrees to resign as an officer and/or
director of Company (or any of its subsidiaries or affiliates),
effective as of the date of such termination, and Executive agrees
to return to Company upon such termination any of the following
which contain confidential information: all documents, instruments,
papers, facsimiles, and computerized information which are the
property of Company or such subsidiary or affiliate.
7. Change in Control. If Executive's employment is
terminated primarily as a result of a Change in Control of Company
or a Potential Change in Control of Company as defined below,
Executive shall receive his Base Salary (at the rate in effect at
the time of termination) for a period of two years or through the
end of the term of this Agreement, whichever is longer.
As used herein, the term "Change in Control" means the
happening of any of the following:
(a) Any person or entity, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, other than Company, a subsidiary of Company, or any
employee benefit plan of Company or its subsidiaries, becomes the
beneficial owner of Company's securities having 25 percent or more
of the combined voting power of the then outstanding securities of
Company that may be cast for the election for directors of Company
(other than as a result of an issuance of securities initiated by
Company in the ordinary course of business); or
(b) As the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, less than a majority of the combined voting
power of the then outstanding securities of Company or any
successor corporation or entity entitled to vote generally in the
election of directors of Company or such other corporation or
entity after such transaction, are held in the aggregate by holders
of Company's securities entitled to vote generally in the election
of directors of Company immediately prior to such transactions; or
(c) During any period of two consecutive years,
individuals who at the beginning of any such period constitute the
Board of Directors of Company cease for any reason to constitute at
least a majority thereof, unless the election, or the nomination
for election by Company's stockholders, of each director of Company
first elected during such period was approved by a vote of at least
two-thirds of the directors of Company then still in office who
were directors of Company at the beginning of any such period.
As used herein, the term "Potential Change in Control" means
the happening of any of the following:
(a) The approval by stockholders of an agreement by
Company, the consummation of which would result in a Change of
Control of Company; or
(b) The acquisition of beneficial ownership, directly or
indirectly, by any entity, person or group (other than Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
Company or its subsidiaries (including any trustee of such plan
acting as trustee) of securities of Company representing 5 percent
or more of the combined voting power of Company's outstanding
securities and the adoption by the Board of Directors of Company of
a resolution to the effect that a Potential Change in Control of
Company has occurred for purposes of this Plan.
8. Disability. If Executive becomes Disabled at any time
during the term of this Agreement, he shall after he becomes
disabled continue to receive all payments and benefits provided
under the terms of this Agreement for a period of twelve
consecutive months, or for the remaining term of this Agreement,
whichever period is shorter. In the event that Executive is
disabled for more than twelve consecutive months during the term of
this Agreement, executive shall, at the expiration of the initial
twelve consecutive month period, be entitled to receive under this
Agreement 50% of his Base Salary plus the insurance and benefits
described in Section 4 of this Agreement for the remaining term of
this Agreement. For purposes of this Agreement, the term disabled
shall mean the inability of Executive (as the result of a physical
or mental condition) to perform the duties of his position under
this Agreement with reasonable accommodation and which inability is
reasonably expected to last at least one (1) full year.
9. Non-competition; Unauthorized Disclosure.
(a) Non-competition. During the period Executive is
employed under this Agreement, and for a period of one year
thereafter, Executive:
(i) shall not engage in any activities, whether as
employer, proprietor, partner, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of
which are traded on a national securities exchange or in the
over-the-counter market, director, officer, employee or otherwise,
in competition with (i) the businesses conducted at the date hereof
by Company or any subsidiary or affiliate, or (ii) any business in
which Company or any subsidiary or affiliate is substantially
engaged at any time during the employment period;
(ii) shall not solicit, in competition with
Company, any person who is a customer of the businesses conducted
by Company at the date hereof or of any business in which Company
is substantially engaged at any time during the term of this
Agreement; and
(iii) shall not induce or attempt to persuade any
employee of Company or any of its divisions, subsidiaries or then
present affiliates to terminate his or her employment relationship
in order to enter into competitive employment.
(b) Unauthorized Disclosure. During the period
Executive is employed under this Agreement, and for a further
period of two years thereafter, Executive shall not, except as
required by any court or administrative agency, without the written
consent of the Board of Directors, or a person authorized thereby,
disclose to any person, other than an employee of Company or a
person to whom disclosure is reasonably necessary or appropriate in
connection with the performance by Executive of his duties as an
executive for Company, any confidential information obtained by him
while in the employ of Company; provided, however, that
confidential information shall not include any information now
known or which becomes known generally to the public (other than as
a result of unauthorized disclosure by Executive).
(c) Scope of Covenants; Remedies. The following
provisions shall apply to the covenants of Executive contained in
this Section 9:
(i) the covenants contained in paragraph (i) and
(ii) of Section 9(a) shall apply within all the territories in
which Company is actively engaged in the conduct of business while
Executive is employed under this Agreement, including, without
limitation, the territories in which customers are then being
solicited;
(ii) without limiting the right of Company to
pursue all other legal and equitable remedies available for
violation by Executive of the covenants contained in this Section
9, it is expressly agreed by Executive and Company that such other
remedies cannot fully compensate Company for any such violation and
that Company shall be entitled to injunctive relief to prevent any
such violation or any continuing violation thereof;
(iii) each party intends and agrees that if, in any
action before any court or agency legally empowered to enforce the
covenants contained in this Section 9, any term, restriction,
covenant or promise contained therein is found to be unreasonable
and accordingly unenforceable, then such term, restriction,
covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency; and
(iv) the covenants contained in this Section 9
shall survive the conclusion of Executive's employment by Company.
10. General Provisions.
(a) Notices. Any notice to be given hereunder by either
party to the other may be effected by personal delivery, in writing
or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the
parties at the addresses set forth below, but each party may change
his or its address by written notice in accordance with this
Section 10 (a). Notices shall be deemed communicated as of the
actual receipt or refusal of receipt.
If to Executive: Frederick Mershad
2229 Edgemere Place
Marietta, GA 30062
If to Company: Proffitt's, Inc.
Post Office Box 9388
Alcoa, TN 37701
(b) Partial Invalidity. If any provision in this
Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remaining provisions shall,
nevertheless, continue in full force and without being impaired or
invalidated in any way.
(c) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Tennessee.
(d) Attorney's Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements in addition to
any other relief to which he or it may be entitled.
(e) Delegation of Duties. Executive may not delegate or
assign any of his duties or obligations hereunder and Company shall
have no right to assign this Agreement without Executive's express
written consent to such assignment. This Agreement shall inure to
the benefit of and bind the parties hereto and their respective
legal representatives, successors and assigns.
(f) Entire Agreement. Except for any prior grants of
options or other forms of incentive compensation evidenced by a
written instrument, this Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to employment of Executive by Company and contains all
of the covenants and agreements between the parties with respect to
such employment. Each party to this Agreement acknowledges that no
representations, inducements or agreements, oral or otherwise, that
have not been embodied herein, and no other agreement, statement or
promise not contained in this Agreement, shall be valid or binding.
Any modification of this Agreement will be effective only if it is
in writing signed by the party to be charged.
(g) No Conflicting Agreement. By signing this
Agreement, Executive warrants that he is not a party to any
restrictive covenant, agreement or contract which limits the
performance of his duties and responsibilities under this Agreement
or under which such performance would constitute a breach.
(h) Headings. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define
or limit the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PROFFITT'S, INC.
BY: /s/ R. Brad Martin
R. Brad Martin
Chairman and Chief
Executive Officer
/s/ Frederick Mershad
Frederick Mershad
Executive
EXHIBIT 10.49
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement ("Agreement")
is entered into as of the 28th day of March 1995, by and between
Proffitt's, Inc., ("Company"), and Gary L. Howard ("Executive").
Company and Executive agree as follows:
1. Employment. Company hereby employs Executive as President
of the McRae's Stores Division of Company or in such other capacity
with Company and its subsidiaries as Company's Board of Directors
shall designate.
2. Duties. During his employment, Executive shall devote
substantially all of his working time, energies, and skills to the
benefit of Company's business. Executive agrees to serve Company
diligently and to the best of his ability and to use his best
efforts to follow the policies and directions of Company's Board of
Directors.
3. Compensation. Executive's compensation and benefits
under this Agreement shall be as follows:
(a) Base Salary. Company shall pay Executive a base
salary ("Base Salary") at a rate of no less than $310,000 per year
(beginning on April 1, 1995). In addition, the Board of Directors
of Company shall, in good faith, consider granting increases in
such Base Salary based upon such factors as Executive's performance
and the growth and/or profitability of Company. Executive's Base
Salary shall be paid in installments in accordance with Company's
normal payment schedule for its senior management. All payments
shall be subject to the deduction of payroll taxes and similar
assessments as required by law.
(b) Bonus. In addition to the Base Salary, Executive
shall be eligible, as long as he holds the position stated in
paragraph 1, for a yearly cash bonus of up to 40% of Base Salary
based upon his performance in accordance with specific annual
objectives, set in advance, all as approved by the Board of
Directors.
4. Insurance and Benefits. Company shall allow Executive to
participate in each employee benefit plan and to receive each
executive benefit that Company provides for persons in Executive's
position.
5. Term. The term of this Agreement shall be for three (3)
years, beginning March 28, 1995, provided, however, that Company
may terminate this Agreement at any time upon thirty (30) days'
prior written notice (at which time this Agreement shall terminate
except for Section 9, which shall continue in effect as set forth
in Section 9). In the event of such termination by Company,
Executive shall be entitled to receive his Base Salary (at the rate
in effect at the time of termination) through the end of the term
of this Agreement. Such Base Salary shall be paid thereafter in
monthly installments. In addition, this Agreement shall terminate
upon the death of executive, except as to Executive's estate's
right to exercise any unexercised stock options pursuant to
Company's stock option plan then in effect, and except as to any
rights which Executive's estate or dependents may have under COBRA
or any other federal or state law or which are derived independent
of this Agreement by reason of his participation in any plan
maintained by Company.
6. Termination by Company for Cause. Company shall have the
right to terminate Executive's employment under this Agreement for
cause, in which event no compensation shall be paid or other
benefits furnished to Executive after termination for cause.
Termination for cause shall be effective immediately upon notice
sent or given to Executive. For purposes of this Agreement, the
term "cause" shall mean and be strictly limited to: (i) conviction
of Executive, after all applicable rights of appeal have been
exhausted or waived, for any crime involving moral turpitude or the
engaging by Executive in any unethical, immoral or fraudulent
conduct which materially discredits Company or is materially
detrimental to the reputation or goodwill of Company; (ii)
commission of any material act of fraud or dishonesty by Executive
against Company, provided that Executive shall first be provided
with written notice of the claim and with an opportunity to contest
said claim before the Board of Directors; or (iii) Executive's
material breach of his obligations under paragraph 2 of the
Agreement, as so determined by the Board of Directors.
(b) In the event that Executive's employment is
terminated, Executive agrees to resign as an officer and/or
director of Company (or any of its subsidiaries or affiliates),
effective as of the date of such termination, and Executive agrees
to return to Company upon such termination any of the following
which contain confidential information: all documents, instruments,
papers, facsimiles, and computerized information which are the
property of Company or such subsidiary or affiliate.
7. Change in Control. If Executive's employment is
terminated primarily as a result of a Change in Control of Company
or a Potential Change in Control of Company as defined below,
Executive shall receive his Base Salary (at the rate in effect at
the time of termination) for a period of two years or through the
end of the term of this Agreement, whichever is longer.
As used herein, the term "Change in Control" means the
happening of any of the following:
(a) Any person or entity, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, other than Company, a subsidiary of Company, or any
employee benefit plan of Company or its subsidiaries, becomes the
beneficial owner of Company's securities having 25 percent or more
of the combined voting power of the then outstanding securities of
Company that may be cast for the election for directors of Company
(other than as a result of an issuance of securities initiated by
Company in the ordinary course of business); or
(b) As the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, less than a majority of the combined voting
power of the then outstanding securities of Company or any
successor corporation or entity entitled to vote generally in the
election of directors of Company or such other corporation or
entity after such transaction, are held in the aggregate by holders
of Company's securities entitled to vote generally in the election
of directors of Company immediately prior to such transactions; or
(c) During any period of two consecutive years,
individuals who at the beginning of any such period constitute the
Board of Directors of Company cease for any reason to constitute at
least a majority thereof, unless the election, or the nomination
for election by Company's stockholders, of each director of Company
first elected during such period was approved by a vote of at least
two-thirds of the directors of Company then still in office who
were directors of Company at the beginning of any such period.
As used herein, the term "Potential Change in Control" means
the happening of any of the following:
(a) The approval by stockholders of an agreement by
Company, the consummation of which would result in a Change of
Control of Company; or
(b) The acquisition of beneficial ownership, directly or
indirectly, by any entity, person or group (other than Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
Company or its subsidiaries (including any trustee of such plan
acting as trustee) of securities of Company representing 5 percent
or more of the combined voting power of Company's outstanding
securities and the adoption by the Board of Directors of Company of
a resolution to the effect that a Potential Change in Control of
Company has occurred for purposes of this Plan.
8. Disability. If Executive becomes Disabled at any time
during the term of this Agreement, he shall after he becomes
disabled continue to receive all payments and benefits provided
under the terms of this Agreement for a period of twelve
consecutive months, or for the remaining term of this Agreement,
whichever period is shorter. In the event that Executive is
disabled for more than twelve consecutive months during the term of
this Agreement, executive shall, at the expiration of the initial
twelve consecutive month period, be entitled to receive under this
Agreement 50% of his Base Salary plus the insurance and benefits
described in Section 4 of this Agreement for the remaining term of
this Agreement. For purposes of this Agreement, the term disabled
shall mean the inability of Executive (as the result of a physical
or mental condition) to perform the duties of his position under
this Agreement with reasonable accommodation and which inability is
reasonably expected to last at least one (1) full year.
9. Non-competition; Unauthorized Disclosure.
(a) Non-competition. During the period Executive is
employed under this Agreement, and for a period of one year
thereafter, Executive:
(i) shall not engage in any activities, whether as
employer, proprietor, partner, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of
which are traded on a national securities exchange or in the
over-the-counter market, director, officer, employee or otherwise,
in competition with (i) the businesses conducted at the date hereof
by Company or any subsidiary or affiliate, or (ii) any business in
which Company or any subsidiary or affiliate is substantially
engaged at any time during the employment period;
(ii) shall not solicit, in competition with
Company, any person who is a customer of the businesses conducted
by Company at the date hereof or of any business in which Company
is substantially engaged at any time during the term of this
Agreement; and
(iii) shall not induce or attempt to persuade any
employee of Company or any of its divisions, subsidiaries or then
present affiliates to terminate his or her employment relationship
in order to enter into competitive employment.
(b) Unauthorized Disclosure. During the period
Executive is employed under this Agreement, and for a further
period of two years thereafter, Executive shall not, except as
required by any court or administrative agency, without the written
consent of the Board of Directors, or a person authorized thereby,
disclose to any person, other than an employee of Company or a
person to whom disclosure is reasonably necessary or appropriate in
connection with the performance by Executive of his duties as an
executive for Company, any confidential information obtained by him
while in the employ of Company; provided, however, that
confidential information shall not include any information now
known or which becomes known generally to the public (other than as
a result of unauthorized disclosure by Executive).
(c) Scope of Covenants; Remedies. The following
provisions shall apply to the covenants of Executive contained in
this Section 9:
(i) the covenants contained in paragraph (i) and
(ii) of Section 9(a) shall apply within all the territories in
which Company is actively engaged in the conduct of business while
Executive is employed under this Agreement, including, without
limitation, the territories in which customers are then being
solicited;
(ii) without limiting the right of Company to
pursue all other legal and equitable remedies available for
violation by Executive of the covenants contained in this Section
9, it is expressly agreed by Executive and Company that such other
remedies cannot fully compensate Company for any such violation and
that Company shall be entitled to injunctive relief to prevent any
such violation or any continuing violation thereof;
(iii) each party intends and agrees that if, in any
action before any court or agency legally empowered to enforce the
covenants contained in this Section 9, any term, restriction,
covenant or promise contained therein is found to be unreasonable
and accordingly unenforceable, then such term, restriction,
covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency; and
(iv) the covenants contained in this Section 9
shall survive the conclusion of Executive's employment by Company.
10. General Provisions.
(a) Notices. Any notice to be given hereunder by either
party to the other may be effected by personal delivery, in writing
or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the
parties at the addresses set forth below, but each party may change
his or its address by written notice in accordance with this
Section 10 (a). Notices shall be deemed communicated as of the
actual receipt or refusal of receipt.
If to Executive: Gary L. Howard
492 Northpointe Parkway
Jackson, MS 39211
If to Company: Proffitt's, Inc.
Post Office Box 9388
Alcoa, TN 37701
(b) Partial Invalidity. If any provision in this
Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remaining provisions shall,
nevertheless, continue in full force and without being impaired or
invalidated in any way.
(c) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Tennessee.
(d) Attorney's Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements in addition to
any other relief to which he or it may be entitled.
(e) Delegation of Duties. Executive may not delegate or
assign any of his duties or obligations hereunder and Company shall
have no right to assign this Agreement without Executive's express
written consent to such assignment. This Agreement shall inure to
the benefit of and bind the parties hereto and their respective
legal representatives, successors and assigns.
(f) Entire Agreement. Except for any prior grants of
options or other forms of incentive compensation evidenced by a
written instrument, this Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to employment of Executive by Company and contains all
of the covenants and agreements between the parties with respect to
such employment. Each party to this Agreement acknowledges that no
representations, inducements or agreements, oral or otherwise, that
have not been embodied herein, and no other agreement, statement or
promise not contained in this Agreement, shall be valid or binding.
Any modification of this Agreement will be effective only if it is
in writing signed by the party to be charged.
(g) No Conflicting Agreement. By signing this
Agreement, Executive warrants that he is not a party to any
restrictive covenant, agreement or contract which limits the
performance of his duties and responsibilities under this Agreement
or under which such performance would constitute a breach.
(h) Headings. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define
or limit the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PROFFITT'S, INC.
BY: /s/ R. Brad Martin
R. Brad Martin
Chairman and Chief
Executive Officer
/s/ Gary L. Howard
Gary L. Howard
Executive
EXHIBIT 10.50
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement ("Agreement")
is entered into as of the 28th day of March 1995, by and between
Proffitt's, Inc., ("Company"), and Brian J. Martin ("Executive").
Company and Executive agree as follows:
1. Employment. Company hereby employs Executive as Senior
Vice President and General Counsel of Company or in such other
capacity with Company and its subsidiaries as Company's Board of
Directors shall designate.
2. Duties. During his employment, Executive shall devote
substantially all of his working time, energies, and skills to the
benefit of Company's business. Executive agrees to serve Company
diligently and to the best of his ability and to use his best
efforts to follow the policies and directions of Company's Board of
Directors.
3. Compensation. Executive's compensation and benefits
under this Agreement shall be as follows:
(a) Base Salary. Company shall pay Executive a base
salary ("Base Salary") at a rate of no less than $140,000 per year
(beginning on April 1, 1995). In addition, the Board of Directors
of Company shall, in good faith, consider granting increases in
such Base Salary based upon such factors as Executive's performance
and the growth and/or profitability of Company. Executive's Base
Salary shall be paid in installments in accordance with Company's
normal payment schedule for its senior management. All payments
shall be subject to the deduction of payroll taxes and similar
assessments as required by law.
(b) Bonus. In addition to the Base Salary, Executive
shall be eligible, as long as he holds the position stated in
paragraph 1, for a yearly cash bonus of up to 30% of Base Salary
based upon his performance in accordance with specific annual
objectives, set in advance, all as approved by the Board of
Directors.
(c) Incentive Compensation. Executive shall be and
hereby is granted a non-qualified option as of March 28, 1995,
("Option") to purchase ten thousand (10,000) shares of Company
common stock at an option price equal to the closing price of the
stock on March 28, 1995, as reported in the Wall Street Journal.
The Option is granted pursuant to Company's 1994 Long-Term
Incentive Plan ("1994 LTIP"), and shall be subject to the terms and
conditions thereof. The Option shall be exercisable on or after
March 28, 1995, (the "Grant date") to the extent of 20% of the
shares covered thereby; exercisable to the extent of an additional
20% of the shares covered thereby on and after the first
anniversary of the Grant Date; exercisable to the extent of an
additional 20% of the shares covered thereby on and after the
second anniversary of the Grant Date; exercisable to the extent of
an additional 20% of the shares covered thereby on an after the
third anniversary of the Grant Date; and exercisable to the extent
of any remaining shares on and after the fourth anniversary of the
Grant Date; provided, however, that no portion of the Option shall
be exercisable any earlier than six months from the Grant Date.
The Option may be exercised (as provided in the 1994 LTIP) up to
ten (10) years from the Grant Date. Any portion of the Option not
exercised within said ten (10) year period shall expire.
Notwithstanding the preceding paragraph, the Option granted
under this Agreement shall not be exercisable if Executive has been
demoted from the position stated in paragraph 1 or otherwise been
reassigned duties at a lower level in the Company. In the case of
such a demotion or reassignment of duties at a lower position,
Company retains the right to reduce the number of option shares
granted under this Agreement and, in such a case, vesting will
occur as if the reduced number of option shares had been granted on
the Grant Date.
(d) Effect of Change of Control on Options. In the
event of a Change of Control (as defined in the 1994 LTIP) any
Options granted to Executive prior to such Change of Control shall
immediately vest.
4. Insurance and Benefits. Company shall allow Executive to
participate in each employee benefit plan and to receive each
executive benefit that Company provides for persons in Executive's
position.
5. Term. The term of this Agreement shall be for two (2)
years, beginning March 28, 1995, provided, however, that Company
may terminate this Agreement at any time upon thirty (30) days'
prior written notice (at which time this Agreement shall terminate
except for Section 9, which shall continue in effect as set forth
in Section 9). In the event of such termination by Company,
Executive shall be entitled to receive his Base Salary (at the rate
in effect at the time of termination) through the end of the term
of this Agreement. Such Base Salary shall be paid thereafter in
monthly installments. In addition, this Agreement shall terminate
upon the death of executive, except as to Executive's estate's
right to exercise any unexercised stock options pursuant to
Company's stock option plan then in effect, and except as to any
rights which Executive's estate or dependents may have under COBRA
or any other federal or state law or which are derived independent
of this Agreement by reason of his participation in any plan
maintained by Company.
6. Termination by Company for Cause. Company shall have the
right to terminate Executive's employment under this Agreement for
cause, in which event no compensation shall be paid or other
benefits furnished to Executive after termination for cause.
Termination for cause shall be effective immediately upon notice
sent or given to Executive. For purposes of this Agreement, the
term "cause" shall mean and be strictly limited to: (i) conviction
of Executive, after all applicable rights of appeal have been
exhausted or waived, for any crime involving moral turpitude or the
engaging by Executive in any unethical, immoral or fraudulent
conduct which materially discredits Company or is materially
detrimental to the reputation or goodwill of Company; (ii)
commission of any material act of fraud or dishonesty by Executive
against Company, provided that Executive shall first be provided
with written notice of the claim and with an opportunity to contest
said claim before the Board of Directors; or (iii) Executive's
material breach of his obligations under paragraph 2 of the
Agreement, as so determined by the Board of Directors.
(b) In the event that Executive's employment is
terminated, Executive agrees to resign as an officer and/or
director of Company (or any of its subsidiaries or affiliates),
effective as of the date of such termination, and Executive agrees
to return to Company upon such termination any of the following
which contain confidential information: all documents, instruments,
papers, facsimiles, and computerized information which are the
property of Company or such subsidiary or affiliate.
7. Change in Control. If Executive's employment is
terminated primarily as a result of a Change in Control of Company
or a Potential Change in Control of Company as defined below,
Executive shall receive his Base Salary (at the rate in effect at
the time of termination) for a period of two years or through the
end of the term of this Agreement, whichever is longer.
As used herein, the term "Change in Control" means the
happening of any of the following:
(a) Any person or entity, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, other than Company, a subsidiary of Company, or any
employee benefit plan of Company or its subsidiaries, becomes the
beneficial owner of Company's securities having 25 percent or more
of the combined voting power of the then outstanding securities of
Company that may be cast for the election for directors of Company
(other than as a result of an issuance of securities initiated by
Company in the ordinary course of business); or
(b) As the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, less than a majority of the combined voting
power of the then outstanding securities of Company or any
successor corporation or entity entitled to vote generally in the
election of directors of Company or such other corporation or
entity after such transaction, are held in the aggregate by holders
of Company's securities entitled to vote generally in the election
of directors of Company immediately prior to such transactions; or
(c) During any period of two consecutive years,
individuals who at the beginning of any such period constitute the
Board of Directors of Company cease for any reason to constitute at
least a majority thereof, unless the election, or the nomination
for election by Company's stockholders, of each director of Company
first elected during such period was approved by a vote of at least
two-thirds of the directors of Company then still in office who
were directors of Company at the beginning of any such period.
As used herein, the term "Potential Change in Control" means
the happening of any of the following:
(a) The approval by stockholders of an agreement by
Company, the consummation of which would result in a Change of
Control of Company; or
(b) The acquisition of beneficial ownership, directly or
indirectly, by any entity, person or group (other than Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
Company or its subsidiaries (including any trustee of such plan
acting as trustee) of securities of Company representing 5 percent
or more of the combined voting power of Company's outstanding
securities and the adoption by the Board of Directors of Company of
a resolution to the effect that a Potential Change in Control of
Company has occurred for purposes of this Plan.
8. Disability. If Executive becomes Disabled at any time
during the term of this Agreement, he shall after he becomes
disabled continue to receive all payments and benefits provided
under the terms of this Agreement for a period of twelve
consecutive months, or for the remaining term of this Agreement,
whichever period is shorter. In the event that Executive is
disabled for more than twelve consecutive months during the term of
this Agreement, executive shall, at the expiration of the initial
twelve consecutive month period, be entitled to receive under this
Agreement 50% of his Base Salary plus the insurance and benefits
described in Section 4 of this Agreement for the remaining term of
this Agreement. For purposes of this Agreement, the term disabled
shall mean the inability of Executive (as the result of a physical
or mental condition) to perform the duties of his position under
this Agreement with reasonable accommodation and which inability is
reasonably expected to last at least one (1) full year.
9. Non-competition; Unauthorized Disclosure.
(a) Non-competition. During the period Executive is
employed under this Agreement, and for a period of one year
thereafter, Executive:
(i) shall not engage in any activities, whether as
employer, proprietor, partner, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of
which are traded on a national securities exchange or in the
over-the-counter market, director, officer, employee or otherwise,
in competition with (i) the businesses conducted at the date hereof
by Company or any subsidiary or affiliate, or (ii) any business in
which Company or any subsidiary or affiliate is substantially
engaged at any time during the employment period;
(ii) shall not solicit, in competition with
Company, any person who is a customer of the businesses conducted
by Company at the date hereof or of any business in which Company
is substantially engaged at any time during the term of this
Agreement; and
(iii) shall not induce or attempt to persuade any
employee of Company or any of its divisions, subsidiaries or then
present affiliates to terminate his or her employment relationship
in order to enter into competitive employment.
(b) Unauthorized Disclosure. During the period
Executive is employed under this Agreement, and for a further
period of two years thereafter, Executive shall not, except as
required by any court or administrative agency, without the written
consent of the Board of Directors, or a person authorized thereby,
disclose to any person, other than an employee of Company or a
person to whom disclosure is reasonably necessary or appropriate in
connection with the performance by Executive of his duties as an
executive for Company, any confidential information obtained by him
while in the employ of Company; provided, however, that
confidential information shall not include any information now
known or which becomes known generally to the public (other than as
a result of unauthorized disclosure by Executive).
(c) Scope of Covenants; Remedies. The following
provisions shall apply to the covenants of Executive contained in
this Section 9:
(i) the covenants contained in paragraph (i) and
(ii) of Section 9(a) shall apply within all the territories in
which Company is actively engaged in the conduct of business while
Executive is employed under this Agreement, including, without
limitation, the territories in which customers are then being
solicited;
(ii) without limiting the right of Company to
pursue all other legal and equitable remedies available for
violation by Executive of the covenants contained in this Section
9, it is expressly agreed by Executive and Company that such other
remedies cannot fully compensate Company for any such violation and
that Company shall be entitled to injunctive relief to prevent any
such violation or any continuing violation thereof;
(iii) each party intends and agrees that if, in any
action before any court or agency legally empowered to enforce the
covenants contained in this Section 9, any term, restriction,
covenant or promise contained therein is found to be unreasonable
and accordingly unenforceable, then such term, restriction,
covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency; and
(iv) the covenants contained in this Section 9
shall survive the conclusion of Executive's employment by Company.
10. General Provisions.
(a) Notices. Any notice to be given hereunder by either
party to the other may be effected by personal delivery, in writing
or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the
parties at the addresses set forth below, but each party may change
his or its address by written notice in accordance with this
Section 10 (a). Notices shall be deemed communicated as of the
actual receipt or refusal of receipt.
If to Executive: Brian J. Martin
2025 Rhymes Road
Crystal Springs, MS 39059
If to Company: Proffitt's, Inc.
Post Office Box 9388
Alcoa, TN 37701
(b) Partial Invalidity. If any provision in this
Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remaining provisions shall,
nevertheless, continue in full force and without being impaired or
invalidated in any way.
(c) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Tennessee.
(d) Attorney's Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements in addition to
any other relief to which he or it may be entitled.
(e) Delegation of Duties. Executive may not delegate or
assign any of his duties or obligations hereunder and Company shall
have no right to assign this Agreement without Executive's express
written consent to such assignment. This Agreement shall inure to
the benefit of and bind the parties hereto and their respective
legal representatives, successors and assigns.
(f) Entire Agreement. Except for any prior grants of
options or other forms of incentive compensation evidenced by a
written instrument, this Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to employment of Executive by Company and contains all
of the covenants and agreements between the parties with respect to
such employment. Each party to this Agreement acknowledges that no
representations, inducements or agreements, oral or otherwise, that
have not been embodied herein, and no other agreement, statement or
promise not contained in this Agreement, shall be valid or binding.
Any modification of this Agreement will be effective only if it is
in writing signed by the party to be charged.
(g) No Conflicting Agreement. By signing this
Agreement, Executive warrants that he is not a party to any
restrictive covenant, agreement or contract which limits the
performance of his duties and responsibilities under this Agreement
or under which such performance would constitute a breach.
(h) Headings. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define
or limit the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PROFFITT'S, INC.
BY: /s/ James A. Coggin
James A. Coggin
President
/s/ Brian J. Martin
Brian J. Martin
Executive
EXHIBIT 10.51
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is entered into as of
the 28th day of March 1995, by and between Proffitt's, Inc.,
("Company"), and James VanNoy ("Executive").
Company and Executive agree as follows:
1. Employment. Company hereby employs Executive as Senior
Vice President of MIS and Chief Information Officer of Company or
in such other capacity with Company and its subsidiaries as
Company's Board of Directors shall designate.
2. Duties. During his employment, Executive shall devote
substantially all of his working time, energies, and skills to the
benefit of Company's business. Executive agrees to serve Company
diligently and to the best of his ability and to use his best
efforts to follow the policies and directions of Company's Board of
Directors.
3. Compensation. Executive's compensation and benefits
under this Agreement shall be as follows:
(a) Base Salary. Company shall pay Executive a base
salary ("Base Salary") at a rate of no less than $155,000 per year
(beginning on April 1, 1995). In addition, the Board of Directors
of Company shall, in good faith, consider granting increases in
such Base Salary based upon such factors as Executive's performance
and the growth and/or profitability of Company. Executive's Base
Salary shall be paid in installments in accordance with Company's
normal payment schedule for its senior management. All payments
shall be subject to the deduction of payroll taxes and similar
assessments as required by law.
(b) Bonus. In addition to the Base Salary, Executive
shall be eligible, as long as he holds the position stated in
paragraph 1, for a yearly cash bonus of up to 30% of Base Salary
based upon his performance in accordance with specific annual
objectives, set in advance, all as approved by the Board of
Directors.
(c) Incentive Compensation. Executive shall be and
hereby is granted a non-qualified option as of March 28, 1995,
("Option") to purchase ten thousand (10,000) shares of Company
common stock at an option price equal to the closing price of the
stock on March 28, 1995, as reported in the Wall Street Journal.
The Option is granted pursuant to Company's 1994 Long-Term
Incentive Plan ("1994 LTIP"), and shall be subject to the terms and
conditions thereof. The Option shall be exercisable on or after
March 28, 1995, (the "Grant date") to the extent of 20% of the
shares covered thereby; exercisable to the extent of an additional
20% of the shares covered thereby on and after the first
anniversary of the Grant Date; exercisable to the extent of an
additional 20% of the shares covered thereby on and after the
second anniversary of the Grant Date; exercisable to the extent of
an additional 20% of the shares covered thereby on an after the
third anniversary of the Grant Date; and exercisable to the extent
of any remaining shares on and after the fourth anniversary of the
Grant Date; provided, however, that no portion of the Option shall
be exercisable any earlier than six months from the Grant Date.
The Option may be exercised (as provided in the 1994 LTIP) up to
ten (10) years from the Grant Date. Any portion of the Option not
exercised within said ten (10) year period shall expire.
Notwithstanding the preceding paragraph, the Option granted
under this Agreement shall not be exercisable if Executive has been
demoted from the position stated in paragraph 1 or otherwise been
reassigned duties at a lower level in the Company. In the case of
such a demotion or reassignment of duties at a lower position,
Company retains the right to reduce the number of option shares
granted under this Agreement and, in such a case, vesting will
occur as if the reduced number of option shares had been granted on
the Grant Date.
(d) Effect of Change of Control on Options. In the
event of a Change of Control (as defined in the 1994 LTIP) any
Options granted to Executive prior to such Change of Control shall
immediately vest.
4. Insurance and Benefits. Company shall allow Executive to
participate in each employee benefit plan and to receive each
executive benefit that Company provides for persons in Executive's
position.
5. Term. The term of this Agreement shall be for one (1)
year, beginning March 28, 1995, provided, however, that Company may
terminate this Agreement at any time upon thirty (30) days' prior
written notice (at which time this Agreement shall terminate except
for Section 9, which shall continue in effect as set forth in
Section 9). In the event of such termination by Company, Executive
shall be entitled to receive his Base Salary (at the rate in effect
at the time of termination) through the end of the term of this
Agreement. Such Base Salary shall be paid thereafter in monthly
installments. In addition, this Agreement shall terminate upon the
death of executive, except as to Executive's estate's right to
exercise any unexercised stock options pursuant to Company's stock
option plan then in effect, and except as to any rights which
Executive's estate or dependents may have under COBRA or any other
federal or state law or which are derived independent of this
Agreement by reason of his participation in any plan maintained by
Company.
6. Termination by Company for Cause. Company shall have the
right to terminate Executive's employment under this Agreement for
cause, in which event no compensation shall be paid or other
benefits furnished to Executive after termination for cause.
Termination for cause shall be effective immediately upon notice
sent or given to Executive. For purposes of this Agreement, the
term "cause" shall mean and be strictly limited to: (i) conviction
of Executive, after all applicable rights of appeal have been
exhausted or waived, for any crime involving moral turpitude or the
engaging by Executive in any unethical, immoral or fraudulent
conduct which materially discredits Company or is materially
detrimental to the reputation or goodwill of Company; (ii)
commission of any material act of fraud or dishonesty by Executive
against Company, provided that Executive shall first be provided
with written notice of the claim and with an opportunity to contest
said claim before the Board of Directors; or (iii) Executive's
material breach of his obligations under paragraph 2 of the
Agreement, as so determined by the Board of Directors.
(b) In the event that Executive's employment is
terminated, Executive agrees to resign as an officer and/or
director of Company (or any of its subsidiaries or affiliates),
effective as of the date of such termination, and Executive agrees
to return to Company upon such termination any of the following
which contain confidential information: all documents, instruments,
papers, facsimiles, and computerized information which are the
property of Company or such subsidiary or affiliate.
7. Change in Control. If Executive's employment is
terminated primarily as a result of a Change in Control of Company
or a Potential Change in Control of Company as defined below,
Executive shall receive his Base Salary (at the rate in effect at
the time of termination) for a period of one year or through the
end of the term of this Agreement, whichever is longer.
As used herein, the term "Change in Control" means the
happening of any of the following:
(a) Any person or entity, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, other than Company, a subsidiary of Company, or any
employee benefit plan of Company or its subsidiaries, becomes the
beneficial owner of Company's securities having 25 percent or more
of the combined voting power of the then outstanding securities of
Company that may be cast for the election for directors of Company
(other than as a result of an issuance of securities initiated by
Company in the ordinary course of business); or
(b) As the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, less than a majority of the combined voting
power of the then outstanding securities of Company or any
successor corporation or entity entitled to vote generally in the
election of directors of Company or such other corporation or
entity after such transaction, are held in the aggregate by holders
of Company's securities entitled to vote generally in the election
of directors of Company immediately prior to such transactions; or
(c) During any period of two consecutive years,
individuals who at the beginning of any such period constitute the
Board of Directors of Company cease for any reason to constitute at
least a majority thereof, unless the election, or the nomination
for election by Company's stockholders, of each director of Company
first elected during such period was approved by a vote of at least
two-thirds of the directors of Company then still in office who
were directors of Company at the beginning of any such period.
As used herein, the term "Potential Change in Control" means
the happening of any of the following:
(a) The approval by stockholders of an agreement by
Company, the consummation of which would result in a Change of
Control of Company; or
(b) The acquisition of beneficial ownership, directly or
indirectly, by any entity, person or group (other than Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
Company or its subsidiaries (including any trustee of such plan
acting as trustee) of securities of Company representing 5 percent
or more of the combined voting power of Company's outstanding
securities and the adoption by the Board of Directors of Company of
a resolution to the effect that a Potential Change in Control of
Company has occurred for purposes of this Plan.
8. Disability. If Executive becomes Disabled at any time
during the term of this Agreement, he shall after he becomes
disabled continue to receive all payments and benefits provided
under the terms of this Agreement for a period of twelve
consecutive months, or for the remaining term of this Agreement,
whichever period is shorter. In the event that Executive is
disabled for more than twelve consecutive months during the term of
this Agreement, executive shall, at the expiration of the initial
twelve consecutive month period, be entitled to receive under this
Agreement 50% of his Base Salary plus the insurance and benefits
described in Section 4 of this Agreement for the remaining term of
this Agreement. For purposes of this Agreement, the term disabled
shall mean the inability of Executive (as the result of a physical
or mental condition) to perform the duties of his position under
this Agreement with reasonable accommodation and which inability is
reasonably expected to last at least one (1) full year.
9. Non-competition; Unauthorized Disclosure.
(a) Non-competition. During the period Executive is
employed under this Agreement, and for a period of one year
thereafter, Executive:
(i) shall not engage in any activities, whether as
employer, proprietor, partner, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of
which are traded on a national securities exchange or in the
over-the-counter market, director, officer, employee or otherwise,
in competition with (i) the businesses conducted at the date hereof
by Company or any subsidiary or affiliate, or (ii) any business in
which Company or any subsidiary or affiliate is substantially
engaged at any time during the employment period;
(ii) shall not solicit, in competition with
Company, any person who is a customer of the businesses conducted
by Company at the date hereof or of any business in which Company
is substantially engaged at any time during the term of this
Agreement; and
(iii) shall not induce or attempt to persuade any
employee of Company or any of its divisions, subsidiaries or then
present affiliates to terminate his or her employment relationship
in order to enter into competitive employment.
(b) Unauthorized Disclosure. During the period
Executive is employed under this Agreement, and for a further
period of two years thereafter, Executive shall not, except as
required by any court or administrative agency, without the written
consent of the Board of Directors, or a person authorized thereby,
disclose to any person, other than an employee of Company or a
person to whom disclosure is reasonably necessary or appropriate in
connection with the performance by Executive of his duties as an
executive for Company, any confidential information obtained by him
while in the employ of Company; provided, however, that
confidential information shall not include any information now
known or which becomes known generally to the public (other than as
a result of unauthorized disclosure by Executive).
(c) Scope of Covenants; Remedies. The following
provisions shall apply to the covenants of Executive contained in
this Section 9:
(i) the covenants contained in paragraph (i) and
(ii) of Section 9(a) shall apply within all the territories in
which Company is actively engaged in the conduct of business while
Executive is employed under this Agreement, including, without
limitation, the territories in which customers are then being
solicited;
(ii) without limiting the right of Company to
pursue all other legal and equitable remedies available for
violation by Executive of the covenants contained in this Section
9, it is expressly agreed by Executive and Company that such other
remedies cannot fully compensate Company for any such violation and
that Company shall be entitled to injunctive relief to prevent any
such violation or any continuing violation thereof;
(iii) each party intends and agrees that if, in any
action before any court or agency legally empowered to enforce the
covenants contained in this Section 9, any term, restriction,
covenant or promise contained therein is found to be unreasonable
and accordingly unenforceable, then such term, restriction,
covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency; and
(iv) the covenants contained in this Section 9
shall survive the conclusion of Executive's employment by Company.
10. General Provisions.
(a) Notices. Any notice to be given hereunder by either
party to the other may be effected by personal delivery, in writing
or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the
parties at the addresses set forth below, but each party may change
his or its address by written notice in accordance with this
Section 10 (a). Notices shall be deemed communicated as of the
actual receipt or refusal of receipt.
If to Executive: James VanNoy
124 Rollingmeadows
Jackson, MS 39211
If to Company: Proffitt's, Inc.
Post Office Box 9388
Alcoa, TN 37701
(b) Partial Invalidity. If any provision in this
Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remaining provisions shall,
nevertheless, continue in full force and without being impaired or
invalidated in any way.
(c) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Tennessee.
(d) Attorney's Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements in addition to
any other relief to which he or it may be entitled.
(e) Delegation of Duties. Executive may not delegate or
assign any of his duties or obligations hereunder and Company shall
have no right to assign this Agreement without Executive's express
written consent to such assignment. This Agreement shall inure to
the benefit of and bind the parties hereto and their respective
legal representatives, successors and assigns.
(f) Entire Agreement. Except for any prior grants of
options or other forms of incentive compensation evidenced by a
written instrument, this Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to employment of Executive by Company and contains all
of the covenants and agreements between the parties with respect to
such employment. Each party to this Agreement acknowledges that no
representations, inducements or agreements, oral or otherwise, that
have not been embodied herein, and no other agreement, statement or
promise not contained in this Agreement, shall be valid or binding.
Any modification of this Agreement will be effective only if it is
in writing signed by the party to be charged.
(g) No Conflicting Agreement. By signing this
Agreement, Executive warrants that he is not a party to any
restrictive covenant, agreement or contract which limits the
performance of his duties and responsibilities under this Agreement
or under which such performance would constitute a breach.
(h) Headings. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define
or limit the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PROFFITT'S, INC.
BY: /s/ R. Brad Martin
R. Brad Martin
Chairman of the Board
/s/ James VanNoy
James VanNoy
Executive
EXHIBIT 10.52
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is entered into as of
the 28th day of March 1995, by and between Proffitt's, Inc.,
("Company"), and David Baker ("Executive").
Company and Executive agree as follows:
1. Employment. Company hereby employs Executive as Senior
Vice President of Operations or in such other capacity with Company
and its subsidiaries as Company's Board of Directors shall
designate.
2. Duties. During his employment, Executive shall devote
substantially all of his working time, energies, and skills to the
benefit of Company's business. Executive agrees to serve Company
diligently and to the best of his ability and to use his best
efforts to follow the policies and directions of Company's Board of
Directors.
3. Compensation. Executive's compensation and benefits
under this Agreement shall be as follows:
(a) Base Salary. Company shall pay Executive a base
salary ("Base Salary") at a rate of no less than $151,000 per year
(beginning on April 1, 1995). In addition, the Board of Directors
of Company shall, in good faith, consider granting increases in
such Base Salary based upon such factors as Executive's performance
and the growth and/or profitability of Company. Executive's Base
Salary shall be paid in installments in accordance with Company's
normal payment schedule for its senior management. All payments
shall be subject to the deduction of payroll taxes and similar
assessments as required by law.
(b) Bonus. In addition to the Base Salary, Executive
shall be eligible, as long as he holds the position stated in
paragraph 1, for a yearly cash bonus of up to 30% of Base Salary
based upon his performance in accordance with specific annual
objectives, set in advance, all as approved by the Board of
Directors.
(c) Incentive Compensation. Executive shall be and
hereby is granted a non-qualified option as of March 28, 1995,
("Option") to purchase ten thousand (10,000) shares of Company
common stock at an option price equal to the closing price of the
stock on March 28, 1995, as reported in the Wall Street Journal.
The Option is granted pursuant to Company's 1994 Long-Term
Incentive Plan ("1994 LTIP"), and shall be subject to the terms and
conditions thereof. The Option shall be exercisable on or after
March 28, 1995, (the "Grant date") to the extent of 20% of the
shares covered thereby; exercisable to the extent of an additional
20% of the shares covered thereby on and after the first
anniversary of the Grant Date; exercisable to the extent of an
additional 20% of the shares covered thereby on and after the
second anniversary of the Grant Date; exercisable to the extent of
an additional 20% of the shares covered thereby on an after the
third anniversary of the Grant Date; and exercisable to the extent
of any remaining shares on and after the fourth anniversary of the
Grant Date; provided, however, that no portion of the Option shall
be exercisable any earlier than six months from the Grant Date.
The Option may be exercised (as provided in the 1994 LTIP) up to
ten (10) years from the Grant Date. Any portion of the Option not
exercised within said ten (10) year period shall expire.
Notwithstanding the preceding paragraph, the Option granted
under this Agreement shall not be exercisable if Executive has been
demoted from the position stated in paragraph 1 or otherwise been
reassigned duties at a lower level in the Company. In the case of
such a demotion or reassignment of duties at a lower position,
Company retains the right to reduce the number of option shares
granted under this Agreement and, in such a case, vesting will
occur as if the reduced number of option shares had been granted on
the Grant Date.
(d) Effect of Change of Control on Options. In the
event of a Change of Control (as defined in the 1994 LTIP) any
Options granted to Executive prior to such Change of Control shall
immediately vest.
4. Insurance and Benefits. Company shall allow Executive to
participate in each employee benefit plan and to receive each
executive benefit that Company provides for persons in Executive's
position.
5. Term. The term of this Agreement shall be for one (1)
year, beginning March 28, 1995, provided, however, that Company may
terminate this Agreement at any time upon thirty (30) days' prior
written notice (at which time this Agreement shall terminate except
for Section 9, which shall continue in effect as set forth in
Section 9). In the event of such termination by Company, Executive
shall be entitled to receive his Base Salary (at the rate in effect
at the time of termination) through the end of the term of this
Agreement. Such Base Salary shall be paid thereafter in monthly
installments. In addition, this Agreement shall terminate upon the
death of executive, except as to Executive's estate's right to
exercise any unexercised stock options pursuant to Company's stock
option plan then in effect, and except as to any rights which
Executive's estate or dependents may have under COBRA or any other
federal or state law or which are derived independent of this
Agreement by reason of his participation in any plan maintained by
Company.
6. Termination by Company for Cause. Company shall have the
right to terminate Executive's employment under this Agreement for
cause, in which event no compensation shall be paid or other
benefits furnished to Executive after termination for cause.
Termination for cause shall be effective immediately upon notice
sent or given to Executive. For purposes of this Agreement, the
term "cause" shall mean and be strictly limited to: (i) conviction
of Executive, after all applicable rights of appeal have been
exhausted or waived, for any crime involving moral turpitude or the
engaging by Executive in any unethical, immoral or fraudulent
conduct which materially discredits Company or is materially
detrimental to the reputation or goodwill of Company; (ii)
commission of any material act of fraud or dishonesty by Executive
against Company, provided that Executive shall first be provided
with written notice of the claim and with an opportunity to contest
said claim before the Board of Directors; or (iii) Executive's
material breach of his obligations under paragraph 2 of the
Agreement, as so determined by the Board of Directors.
(b) In the event that Executive's employment is
terminated, Executive agrees to resign as an officer and/or
director of Company (or any of its subsidiaries or affiliates),
effective as of the date of such termination, and Executive agrees
to return to Company upon such termination any of the following
which contain confidential information: all documents, instruments,
papers, facsimiles, and computerized information which are the
property of Company or such subsidiary or affiliate.
7. Change in Control. If Executive's employment is
terminated primarily as a result of a Change in Control of Company
or a Potential Change in Control of Company as defined below,
Executive shall receive his Base Salary (at the rate in effect at
the time of termination) for a period of one year or through the
end of the term of this Agreement, whichever is longer.
As used herein, the term "Change in Control" means the
happening of any of the following:
(a) Any person or entity, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, other than Company, a subsidiary of Company, or any
employee benefit plan of Company or its subsidiaries, becomes the
beneficial owner of Company's securities having 25 percent or more
of the combined voting power of the then outstanding securities of
Company that may be cast for the election for directors of Company
(other than as a result of an issuance of securities initiated by
Company in the ordinary course of business); or
(b) As the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, less than a majority of the combined voting
power of the then outstanding securities of Company or any
successor corporation or entity entitled to vote generally in the
election of directors of Company or such other corporation or
entity after such transaction, are held in the aggregate by holders
of Company's securities entitled to vote generally in the election
of directors of Company immediately prior to such transactions; or
(c) During any period of two consecutive years,
individuals who at the beginning of any such period constitute the
Board of Directors of Company cease for any reason to constitute at
least a majority thereof, unless the election, or the nomination
for election by Company's stockholders, of each director of Company
first elected during such period was approved by a vote of at least
two-thirds of the directors of Company then still in office who
were directors of Company at the beginning of any such period.
As used herein, the term "Potential Change in Control" means
the happening of any of the following:
(a) The approval by stockholders of an agreement by
Company, the consummation of which would result in a Change of
Control of Company; or
(b) The acquisition of beneficial ownership, directly or
indirectly, by any entity, person or group (other than Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
Company or its subsidiaries (including any trustee of such plan
acting as trustee) of securities of Company representing 5 percent
or more of the combined voting power of Company's outstanding
securities and the adoption by the Board of Directors of Company of
a resolution to the effect that a Potential Change in Control of
Company has occurred for purposes of this Plan.
8. Disability. If Executive becomes Disabled at any time
during the term of this Agreement, he shall after he becomes
disabled continue to receive all payments and benefits provided
under the terms of this Agreement for a period of twelve
consecutive months, or for the remaining term of this Agreement,
whichever period is shorter. In the event that Executive is
disabled for more than twelve consecutive months during the term of
this Agreement, executive shall, at the expiration of the initial
twelve consecutive month period, be entitled to receive under this
Agreement 50% of his Base Salary plus the insurance and benefits
described in Section 4 of this Agreement for the remaining term of
this Agreement. For purposes of this Agreement, the term disabled
shall mean the inability of Executive (as the result of a physical
or mental condition) to perform the duties of his position under
this Agreement with reasonable accommodation and which inability is
reasonably expected to last at least one (1) full year.
9. Non-competition; Unauthorized Disclosure.
(a) Non-competition. During the period Executive is
employed under this Agreement, and for a period of one year
thereafter, Executive:
(i) shall not engage in any activities, whether as
employer, proprietor, partner, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of
which are traded on a national securities exchange or in the
over-the-counter market, director, officer, employee or otherwise,
in competition with (i) the businesses conducted at the date hereof
by Company or any subsidiary or affiliate, or (ii) any business in
which Company or any subsidiary or affiliate is substantially
engaged at any time during the employment period;
(ii) shall not solicit, in competition with
Company, any person who is a customer of the businesses conducted
by Company at the date hereof or of any business in which Company
is substantially engaged at any time during the term of this
Agreement; and
(iii) shall not induce or attempt to persuade any
employee of Company or any of its divisions, subsidiaries or then
present affiliates to terminate his or her employment relationship
in order to enter into competitive employment.
(b) Unauthorized Disclosure. During the period
Executive is employed under this Agreement, and for a further
period of two years thereafter, Executive shall not, except as
required by any court or administrative agency, without the written
consent of the Board of Directors, or a person authorized thereby,
disclose to any person, other than an employee of Company or a
person to whom disclosure is reasonably necessary or appropriate in
connection with the performance by Executive of his duties as an
executive for Company, any confidential information obtained by him
while in the employ of Company; provided, however, that
confidential information shall not include any information now
known or which becomes known generally to the public (other than as
a result of unauthorized disclosure by Executive).
(c) Scope of Covenants; Remedies. The following
provisions shall apply to the covenants of Executive contained in
this Section 9:
(i) the covenants contained in paragraph (i) and
(ii) of Section 9(a) shall apply within all the territories in
which Company is actively engaged in the conduct of business while
Executive is employed under this Agreement, including, without
limitation, the territories in which customers are then being
solicited;
(ii) without limiting the right of Company to
pursue all other legal and equitable remedies available for
violation by Executive of the covenants contained in this Section
9, it is expressly agreed by Executive and Company that such other
remedies cannot fully compensate Company for any such violation and
that Company shall be entitled to injunctive relief to prevent any
such violation or any continuing violation thereof;
(iii) each party intends and agrees that if, in any
action before any court or agency legally empowered to enforce the
covenants contained in this Section 9, any term, restriction,
covenant or promise contained therein is found to be unreasonable
and accordingly unenforceable, then such term, restriction,
covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency; and
(iv) the covenants contained in this Section 9
shall survive the conclusion of Executive's employment by Company.
10. General Provisions.
(a) Notices. Any notice to be given hereunder by either
party to the other may be effected by personal delivery, in writing
or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the
parties at the addresses set forth below, but each party may change
his or its address by written notice in accordance with this
Section 10 (a). Notices shall be deemed communicated as of the
actual receipt or refusal of receipt.
If to Executive: David Baker
5359 Briarfield Road
Jackson, MS 39211
If to Company: Proffitt's, Inc.
Post Office Box 9388
Alcoa, TN 37701
(b) Partial Invalidity. If any provision in this
Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remaining provisions shall,
nevertheless, continue in full force and without being impaired or
invalidated in any way.
(c) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Tennessee.
(d) Attorney's Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements in addition to
any other relief to which he or it may be entitled.
(e) Delegation of Duties. Executive may not delegate or
assign any of his duties or obligations hereunder and Company shall
have no right to assign this Agreement without Executive's express
written consent to such assignment. This Agreement shall inure to
the benefit of and bind the parties hereto and their respective
legal representatives, successors and assigns.
(f) Entire Agreement. Except for any prior grants of
options or other forms of incentive compensation evidenced by a
written instrument, this Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to employment of Executive by Company and contains all
of the covenants and agreements between the parties with respect to
such employment. Each party to this Agreement acknowledges that no
representations, inducements or agreements, oral or otherwise, that
have not been embodied herein, and no other agreement, statement or
promise not contained in this Agreement, shall be valid or binding.
Any modification of this Agreement will be effective only if it is
in writing signed by the party to be charged.
(g) No Conflicting Agreement. By signing this
Agreement, Executive warrants that he is not a party to any
restrictive covenant, agreement or contract which limits the
performance of his duties and responsibilities under this Agreement
or under which such performance would constitute a breach.
(h) Headings. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define
or limit the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PROFFITT'S, INC.
BY: /s/ R. Brad Martin
R. Brad Martin
Chairman of the Board
/s/ David Baker
David Baker
Executive
EHXIBIT 10.53
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement ("Agreement")
is entered into as of the 28th day of March 1995, by and between
Proffitt's, Inc., ("Company"), and A. Coleman Piper ("Executive").
Company and Executive agree as follows:
1. Employment. Company hereby employs Executive as Executive
Vice President of Stores, Proffitt's Stores Division, or in such
other capacity with Company and its subsidiaries as Company's Board
of Directors shall designate.
2. Duties. During his employment, Executive shall devote
substantially all of his working time, energies, and skills to the
benefit of Company's business. Executive agrees to serve Company
diligently and to the best of his ability and to use his best
efforts to follow the policies and directions of Company's Board of
Directors.
3. Compensation. Executive's compensation and benefits under
this Agreement shall be as follows:
(a) Base Salary. Company shall pay Executive a base
salary ("Base Salary") at a rate of no less than $160,000 per year
(beginning on April 1, 1995). In addition, the Board of Directors
of Company shall, in good faith, consider granting increases in
such Base Salary based upon such factors as Executive's performance
and the growth and/or profitability of Company. Executive's Base
Salary shall be paid in installments in accordance with Company's
normal payment schedule for its senior management. All payments
shall be subject to the deduction of payroll taxes and similar
assessments as required by law.
(b) Bonus. In addition to the Base Salary, Executive
shall be eligible, as long as he holds the position stated in
paragraph 1, for a yearly cash bonus of up to 30% of Base Salary
based upon his performance in accordance with specific annual
objectives, set in advance, all as approved by the Board of
Directors.
4. Insurance and Benefits. Company shall allow Executive to
participate in each employee benefit plan and to receive each
executive benefit that Company provides for persons in Executive's
position.
5. Term. The term of this Agreement shall be for two (2)
years, beginning March 28, 1995, provided, however, that Company
may terminate this Agreement at any time upon thirty (30) days'
prior written notice (at which time this Agreement shall terminate
except for Section 9, which shall continue in effect as set forth
in Section 9). In the event of such termination by Company,
Executive shall be entitled to receive his Base Salary (at the rate
in effect at the time of termination) through the end of the term
of this Agreement. Such Base Salary shall be paid thereafter in
monthly installments. In addition, this Agreement shall terminate
upon the death of executive, except as to Executive's estate's
right to exercise any unexercised stock options pursuant to
Company's stock option plan then in effect, and except as to any
rights which Executive's estate or dependents may have under COBRA
or any other federal or state law or which are derived independent
of this Agreement by reason of his participation in any plan
maintained by Company.
6. Termination by Company for Cause. Company shall have the
right to terminate Executive's employment under this Agreement for
cause, in which event no compensation shall be paid or other
benefits furnished to Executive after termination for cause.
Termination for cause shall be effective immediately upon notice
sent or given to Executive. For purposes of this Agreement, the
term "cause" shall mean and be strictly limited to: (i) conviction
of Executive, after all applicable rights of appeal have been
exhausted or waived, for any crime involving moral turpitude or the
engaging by Executive in any unethical, immoral or fraudulent
conduct which materially discredits Company or is materially
detrimental to the reputation or goodwill of Company; (ii)
commission of any material act of fraud or dishonesty by Executive
against Company, provided that Executive shall first be provided
with written notice of the claim and with an opportunity to contest
said claim before the Board of Directors; or (iii) Executive's
material breach of his obligations under paragraph 2 of the
Agreement, as so determined by the Board of Directors.
(b) In the event that Executive's employment is
terminated, Executive agrees to resign as an officer and/or
director of Company (or any of its subsidiaries or affiliates),
effective as of the date of such termination, and Executive agrees
to return to Company upon such termination any of the following
which contain confidential information: all documents, instruments,
papers, facsimiles, and computerized information which are the
property of Company or such subsidiary or affiliate.
7. Change in Control. If Executive's employment is terminated
primarily as a result of a Change in Control of Company or a
Potential Change in Control of Company as defined below, Executive
shall receive his Base Salary (at the rate in effect at the time of
termination) for a period of two years or through the end of the
term of this Agreement, whichever is longer.
As used herein, the term "Change in Control" means the
happening of any of the following:
(a) Any person or entity, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, other than Company, a subsidiary of Company, or any
employee benefit plan of Company or its subsidiaries, becomes the
beneficial owner of Company's securities having 25 percent or more
of the combined voting power of the then outstanding securities of
Company that may be cast for the election for directors of Company
(other than as a result of an issuance of securities initiated by
Company in the ordinary course of business); or
(b) As the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, less than a majority of the combined voting
power of the then outstanding securities of Company or any
successor corporation or entity entitled to vote generally in the
election of directors of Company or such other corporation or
entity after such transaction, are held in the aggregate by holders
of Company's securities entitled to vote generally in the election
of directors of Company immediately prior to such transactions; or
(c) During any period of two consecutive years,
individuals who at the beginning of any such period constitute the
Board of Directors of Company cease for any reason to constitute at
least a majority thereof, unless the election, or the nomination
for election by Company's stockholders, of each director of Company
first elected during such period was approved by a vote of at least
two-thirds of the directors of Company then still in office who
were directors of Company at the beginning of any such period.
As used herein, the term "Potential Change in Control" means
the happening of any of the following:
(a) The approval by stockholders of an agreement by
Company, the consummation of which would result in a Change of
Control of Company; or
(b) The acquisition of beneficial ownership, directly or
indirectly, by any entity, person or group (other than Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
Company or its subsidiaries (including any trustee of such plan
acting as trustee) of securities of Company representing 5 percent
or more of the combined voting power of Company's outstanding
securities and the adoption by the Board of Directors of Company of
a resolution to the effect that a Potential Change in Control of
Company has occurred for purposes of this Plan.
8. Disability. If Executive becomes Disabled at any time
during the term of this Agreement, he shall after he becomes
disabled continue to receive all payments and benefits provided
under the terms of this Agreement for a period of twelve
consecutive months, or for the remaining term of this Agreement,
whichever period is shorter. In the event that Executive is
disabled for more than twelve consecutive months during the term of
this Agreement, executive shall, at the expiration of the initial
twelve consecutive month period, be entitled to receive under this
Agreement 50% of his Base Salary plus the insurance and benefits
described in Section 4 of this Agreement for the remaining term of
this Agreement. For purposes of this Agreement, the term disabled
shall mean the inability of Executive (as the result of a physical
or mental condition) to perform the duties of his position under
this Agreement with reasonable accommodation and which inability is
reasonably expected to last at least one (1) full year.
9. Non-competition; Unauthorized Disclosure.
(a) Non-competition. During the period Executive is
employed under this Agreement, and for a period of one year
thereafter, Executive:
(i) shall not engage in any activities, whether as
employer, proprietor, partner, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of
which are traded on a national securities exchange or in the
over-the-counter market, director, officer, employee or otherwise,
in competition with (i) the businesses conducted at the date hereof
by Company or any subsidiary or affiliate, or (ii) any business in
which Company or any subsidiary or affiliate is substantially
engaged at any time during the employment period;
(ii) shall not solicit, in competition with
Company, any person who is a customer of the businesses conducted
by Company at the date hereof or of any business in which Company
is substantially engaged at any time during the term of this
Agreement; and
(iii) shall not induce or attempt to persuade any
employee of Company or any of its divisions, subsidiaries or then
present affiliates to terminate his or her employment relationship
in order to enter into competitive employment.
(b) Unauthorized Disclosure. During the period
Executive is employed under this Agreement, and for a further
period of two years thereafter, Executive shall not, except as
required by any court or administrative agency, without the written
consent of the Board of Directors, or a person authorized thereby,
disclose to any person, other than an employee of Company or a
person to whom disclosure is reasonably necessary or appropriate in
connection with the performance by Executive of his duties as an
executive for Company, any confidential information obtained by him
while in the employ of Company; provided, however, that
confidential information shall not include any information now
known or which becomes known generally to the public (other than as
a result of unauthorized disclosure by Executive).
(c) Scope of Covenants; Remedies. The following
provisions shall apply to the covenants of Executive contained in
this Section 9:
(i) the covenants contained in paragraph (i) and
(ii) of Section 9(a) shall apply within all the territories in
which Company is actively engaged in the conduct of business while
Executive is employed under this Agreement, including, without
limitation, the territories in which customers are then being
solicited;
(ii) without limiting the right of Company to
pursue all other legal and equitable remedies available for
violation by Executive of the covenants contained in this Section
9, it is expressly agreed by Executive and Company that such other
remedies cannot fully compensate Company for any such violation and
that Company shall be entitled to injunctive relief to prevent any
such violation or any continuing violation thereof;
(iii) each party intends and agrees that if, in any
action before any court or agency legally empowered to enforce the
covenants contained in this Section 9, any term, restriction,
covenant or promise contained therein is found to be unreasonable
and accordingly unenforceable, then such term, restriction,
covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency; and
(iv) the covenants contained in this Section 9
shall survive the conclusion of Executive's employment by Company.
10. General Provisions.
(a) Notices. Any notice to be given hereunder by either
party to the other may be effected by personal delivery, in writing
or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the
parties at the addresses set forth below, but each party may change
his or its address by written notice in accordance with this
Section 10 (a). Notices shall be deemed communicated as of the
actual receipt or refusal of receipt.
If to Executive: A. Coleman Piper
2400 Gallaher Ferry Road
Knoxville, TN 37932
If to Company: Proffitt's, Inc.
Post Office Box 9388
Alcoa, TN 37701
(b) Partial Invalidity. If any provision in this
Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remaining provisions shall,
nevertheless, continue in full force and without being impaired or
invalidated in any way.
(c) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Tennessee.
(d) Attorney's Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements in addition to
any other relief to which he or it may be entitled.
(e) Delegation of Duties. Executive may not delegate or
assign any of his duties or obligations hereunder and Company shall
have no right to assign this Agreement without Executive's express
written consent to such assignment. This Agreement shall inure to
the benefit of and bind the parties hereto and their respective
legal representatives, successors and assigns.
(f) Entire Agreement. Except for any prior grants of
options or other forms of incentive compensation evidenced by a
written instrument, this Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to employment of Executive by Company and contains all
of the covenants and agreements between the parties with respect to
such employment. Each party to this Agreement acknowledges that no
representations, inducements or agreements, oral or otherwise, that
have not been embodied herein, and no other agreement, statement or
promise not contained in this Agreement, shall be valid or binding.
Any modification of this Agreement will be effective only if it is
in writing signed by the party to be charged.
(g) No Conflicting Agreement. By signing this
Agreement, Executive warrants that he is not a party to any
restrictive covenant, agreement or contract which limits the
performance of his duties and responsibilities under this Agreement
or under which such performance would constitute a breach.
(h) Headings. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define
or limit the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PROFFITT'S, INC.
BY: /s/ R. Brad Martin
R. Brad Martin
Chairman and Chief
Executive Officer
/s/ A. Coleman Piper
A. Coleman Piper
Executive
EXHIBIT 10.54
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is entered into as of
the 28th day of March 1995, by and between Proffitt's, Inc.,
("Company"), and Robert Oliver ("Executive").
Company and Executive agree as follows:
1. Employment. Company hereby employs Executive as Executive
Vice President of Stores, McRae's Division, or in such other
capacity with Company and its subsidiaries as Company's Board of
Directors shall designate.
2. Duties. During his employment, Executive shall devote
substantially all of his working time, energies, and skills to the
benefit of Company's business. Executive agrees to serve Company
diligently and to the best of his ability and to use his best
efforts to follow the policies and directions of Company's Board of
Directors.
3. Compensation. Executive's compensation and benefits
under this Agreement shall be as follows:
(a) Base Salary. Company shall pay Executive a base
salary ("Base Salary") at a rate of no less than $195,000 per year
(beginning on April 1, 1995). In addition, the Board of Directors
of Company shall, in good faith, consider granting increases in
such Base Salary based upon such factors as Executive's performance
and the growth and/or profitability of Company. Executive's Base
Salary shall be paid in installments in accordance with Company's
normal payment schedule for its senior management. All payments
shall be subject to the deduction of payroll taxes and similar
assessments as required by law.
(b) Bonus. In addition to the Base Salary, Executive
shall be eligible, as long as he holds the position stated in
paragraph 1, for a yearly cash bonus of up to 30% of Base Salary
based upon his performance in accordance with specific annual
objectives, set in advance, all as approved by the Board of
Directors.
(c) Incentive Compensation. Executive shall be and
hereby is granted a non-qualified option as of March 28, 1995,
("Option") to purchase ten thousand (10,000) shares of Company
common stock at an option price equal to the closing price of the
stock on March 28, 1995, as reported in the Wall Street Journal.
The Option is granted pursuant to Company's 1994 Long-Term
Incentive Plan ("1994 LTIP"), and shall be subject to the terms and
conditions thereof. The Option shall be exercisable on or after
March 28, 1995, (the "Grant date") to the extent of 20% of the
shares covered thereby; exercisable to the extent of an additional
20% of the shares covered thereby on and after the first
anniversary of the Grant Date; exercisable to the extent of an
additional 20% of the shares covered thereby on and after the
second anniversary of the Grant Date; exercisable to the extent of
an additional 20% of the shares covered thereby on an after the
third anniversary of the Grant Date; and exercisable to the extent
of any remaining shares on and after the fourth anniversary of the
Grant Date; provided, however, that no portion of the Option shall
be exercisable any earlier than six months from the Grant Date.
The Option may be exercised (as provided in the 1994 LTIP) up to
ten (10) years from the Grant Date. Any portion of the Option not
exercised within said ten (10) year period shall expire.
Notwithstanding the preceding paragraph, the Option granted
under this Agreement shall not be exercisable if Executive has been
demoted from the position stated in paragraph 1 or otherwise been
reassigned duties at a lower level in the Company. In the case of
such a demotion or reassignment of duties at a lower position,
Company retains the right to reduce the number of option shares
granted under this Agreement and, in such a case, vesting will
occur as if the reduced number of option shares had been granted on
the Grant Date.
(d) Effect of Change of Control on Options. In the
event of a Change of Control (as defined in the 1994 LTIP) any
Options granted to Executive prior to such Change of Control shall
immediately vest.
4. Insurance and Benefits. Company shall allow Executive to
participate in each employee benefit plan and to receive each
executive benefit that Company provides for persons in Executive's
position.
5. Term. The term of this Agreement shall be for two (2)
years, beginning March 28, 1995, provided, however, that Company
may terminate this Agreement at any time upon thirty (30) days'
prior written notice (at which time this Agreement shall terminate
except for Section 9, which shall continue in effect as set forth
in Section 9). In the event of such termination by Company,
Executive shall be entitled to receive his Base Salary (at the rate
in effect at the time of termination) through the end of the term
of this Agreement. Such Base Salary shall be paid thereafter in
monthly installments. In addition, this Agreement shall terminate
upon the death of executive, except as to Executive's estate's
right to exercise any unexercised stock options pursuant to
Company's stock option plan then in effect, and except as to any
rights which Executive's estate or dependents may have under COBRA
or any other federal or state law or which are derived independent
of this Agreement by reason of his participation in any plan
maintained by Company.
6. Termination by Company for Cause. Company shall have the
right to terminate Executive's employment under this Agreement for
cause, in which event no compensation shall be paid or other
benefits furnished to Executive after termination for cause.
Termination for cause shall be effective immediately upon notice
sent or given to Executive. For purposes of this Agreement, the
term "cause" shall mean and be strictly limited to: (i) conviction
of Executive, after all applicable rights of appeal have been
exhausted or waived, for any crime involving moral turpitude or the
engaging by Executive in any unethical, immoral or fraudulent
conduct which materially discredits Company or is materially
detrimental to the reputation or goodwill of Company; (ii)
commission of any material act of fraud or dishonesty by Executive
against Company, provided that Executive shall first be provided
with written notice of the claim and with an opportunity to contest
said claim before the Board of Directors; or (iii) Executive's
material breach of his obligations under paragraph 2 of the
Agreement, as so determined by the Board of Directors.
(b) In the event that Executive's employment is
terminated, Executive agrees to resign as an officer and/or
director of Company (or any of its subsidiaries or affiliates),
effective as of the date of such termination, and Executive agrees
to return to Company upon such termination any of the following
which contain confidential information: all documents, instruments,
papers, facsimiles, and computerized information which are the
property of Company or such subsidiary or affiliate.
7. Change in Control. If Executive's employment is
terminated primarily as a result of a Change in Control of Company
or a Potential Change in Control of Company as defined below,
Executive shall receive his Base Salary (at the rate in effect at
the time of termination) for a period of two years or through the
end of the term of this Agreement, whichever is longer.
As used herein, the term "Change in Control" means the
happening of any of the following:
(a) Any person or entity, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, other than Company, a subsidiary of Company, or any
employee benefit plan of Company or its subsidiaries, becomes the
beneficial owner of Company's securities having 25 percent or more
of the combined voting power of the then outstanding securities of
Company that may be cast for the election for directors of Company
(other than as a result of an issuance of securities initiated by
Company in the ordinary course of business); or
(b) As the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, less than a majority of the combined voting
power of the then outstanding securities of Company or any
successor corporation or entity entitled to vote generally in the
election of directors of Company or such other corporation or
entity after such transaction, are held in the aggregate by holders
of Company's securities entitled to vote generally in the election
of directors of Company immediately prior to such transactions; or
(c) During any period of two consecutive years,
individuals who at the beginning of any such period constitute the
Board of Directors of Company cease for any reason to constitute at
least a majority thereof, unless the election, or the nomination
for election by Company's stockholders, of each director of Company
first elected during such period was approved by a vote of at least
two-thirds of the directors of Company then still in office who
were directors of Company at the beginning of any such period.
As used herein, the term "Potential Change in Control" means
the happening of any of the following:
(a) The approval by stockholders of an agreement by
Company, the consummation of which would result in a Change of
Control of Company; or
(b) The acquisition of beneficial ownership, directly or
indirectly, by any entity, person or group (other than Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
Company or its subsidiaries (including any trustee of such plan
acting as trustee) of securities of Company representing 5 percent
or more of the combined voting power of Company's outstanding
securities and the adoption by the Board of Directors of Company of
a resolution to the effect that a Potential Change in Control of
Company has occurred for purposes of this Plan.
8. Disability. If Executive becomes Disabled at any time
during the term of this Agreement, he shall after he becomes
disabled continue to receive all payments and benefits provided
under the terms of this Agreement for a period of twelve
consecutive months, or for the remaining term of this Agreement,
whichever period is shorter. In the event that Executive is
disabled for more than twelve consecutive months during the term of
this Agreement, executive shall, at the expiration of the initial
twelve consecutive month period, be entitled to receive under this
Agreement 50% of his Base Salary plus the insurance and benefits
described in Section 4 of this Agreement for the remaining term of
this Agreement. For purposes of this Agreement, the term disabled
shall mean the inability of Executive (as the result of a physical
or mental condition) to perform the duties of his position under
this Agreement with reasonable accommodation and which inability is
reasonably expected to last at least one (1) full year.
9. Non-competition; Unauthorized Disclosure.
(a) Non-competition. During the period Executive is
employed under this Agreement, and for a period of one year
thereafter, Executive:
(i) shall not engage in any activities, whether as
employer, proprietor, partner, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of
which are traded on a national securities exchange or in the
over-the-counter market, director, officer, employee or otherwise,
in competition with (i) the businesses conducted at the date hereof
by Company or any subsidiary or affiliate, or (ii) any business in
which Company or any subsidiary or affiliate is substantially
engaged at any time during the employment period;
(ii) shall not solicit, in competition with
Company, any person who is a customer of the businesses conducted
by Company at the date hereof or of any business in which Company
is substantially engaged at any time during the term of this
Agreement; and
(iii) shall not induce or attempt to persuade any
employee of Company or any of its divisions, subsidiaries or then
present affiliates to terminate his or her employment relationship
in order to enter into competitive employment.
(b) Unauthorized Disclosure. During the period
Executive is employed under this Agreement, and for a further
period of two years thereafter, Executive shall not, except as
required by any court or administrative agency, without the written
consent of the Board of Directors, or a person authorized thereby,
disclose to any person, other than an employee of Company or a
person to whom disclosure is reasonably necessary or appropriate in
connection with the performance by Executive of his duties as an
executive for Company, any confidential information obtained by him
while in the employ of Company; provided, however, that
confidential information shall not include any information now
known or which becomes known generally to the public (other than as
a result of unauthorized disclosure by Executive).
(c) Scope of Covenants; Remedies. The following
provisions shall apply to the covenants of Executive contained in
this Section 9:
(i) the covenants contained in paragraph (i) and
(ii) of Section 9(a) shall apply within all the territories in
which Company is actively engaged in the conduct of business while
Executive is employed under this Agreement, including, without
limitation, the territories in which customers are then being
solicited;
(ii) without limiting the right of Company to
pursue all other legal and equitable remedies available for
violation by Executive of the covenants contained in this Section
9, it is expressly agreed by Executive and Company that such other
remedies cannot fully compensate Company for any such violation and
that Company shall be entitled to injunctive relief to prevent any
such violation or any continuing violation thereof;
(iii) each party intends and agrees that if, in any
action before any court or agency legally empowered to enforce the
covenants contained in this Section 9, any term, restriction,
covenant or promise contained therein is found to be unreasonable
and accordingly unenforceable, then such term, restriction,
covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency; and
(iv) the covenants contained in this Section 9
shall survive the conclusion of Executive's employment by Company.
10. General Provisions.
(a) Notices. Any notice to be given hereunder by either
party to the other may be effected by personal delivery, in writing
or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the
parties at the addresses set forth below, but each party may change
his or its address by written notice in accordance with this
Section 10 (a). Notices shall be deemed communicated as of the
actual receipt or refusal of receipt.
If to Executive: Robert Oliver
1647 Maywood Circle
Jackson, MS 39211
If to Company: Proffitt's, Inc.
Post Office Box 9388
Alcoa, TN 37701
(b) Partial Invalidity. If any provision in this
Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remaining provisions shall,
nevertheless, continue in full force and without being impaired or
invalidated in any way.
(c) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Tennessee.
(d) Attorney's Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements in addition to
any other relief to which he or it may be entitled.
(e) Delegation of Duties. Executive may not delegate or
assign any of his duties or obligations hereunder and Company shall
have no right to assign this Agreement without Executive's express
written consent to such assignment. This Agreement shall inure to
the benefit of and bind the parties hereto and their respective
legal representatives, successors and assigns.
(f) Entire Agreement. Except for any prior grants of
options or other forms of incentive compensation evidenced by a
written instrument, this Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to employment of Executive by Company and contains all
of the covenants and agreements between the parties with respect to
such employment. Each party to this Agreement acknowledges that no
representations, inducements or agreements, oral or otherwise, that
have not been embodied herein, and no other agreement, statement or
promise not contained in this Agreement, shall be valid or binding.
Any modification of this Agreement will be effective only if it is
in writing signed by the party to be charged.
(g) No Conflicting Agreement. By signing this
Agreement, Executive warrants that he is not a party to any
restrictive covenant, agreement or contract which limits the
performance of his duties and responsibilities under this Agreement
or under which such performance would constitute a breach.
(h) Headings. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define
or limit the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PROFFITT'S, INC.
BY: /s/ R. Brad Martin
R. Brad Martin
Chairman of the Board
/s/ Robert Oliver
Robert Oliver
Executive
EXHIBIT 10.55
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement ("Agreement")
is entered into as of the 28th day of March 1995, by and between
Proffitt's, Inc., ("Company"), and Julia A. Bentley ("Executive").
Company and Executive agree as follows:
1. Employment. Company hereby employs Executive as Senior
Vice President of Planning/Shareholder Relations of Company or in
such other capacity with Company and its subsidiaries as Company's
Board of Directors shall designate.
2. Duties. During her employment, Executive shall devote
substantially all of her working time, energies, and skills to the
benefit of Company's business. Executive agrees to serve Company
diligently and to the best of her ability and to use her best
efforts to follow the policies and directions of Company's Board of
Directors.
3. Compensation. Executive's compensation and benefits
under this Agreement shall be as follows:
(a) Base Salary. Company shall pay Executive a base
salary ("Base Salary") at a rate of no less than $135,000 per year
(beginning on April 1, 1995). In addition, the Board of Directors
of Company shall, in good faith, consider granting increases in
such Base Salary based upon such factors as Executive's performance
and the growth and/or profitability of Company. Executive's Base
Salary shall be paid in installments in accordance with Company's
normal payment schedule for its senior management. All payments
shall be subject to the deduction of payroll taxes and similar
assessments as required by law.
(b) Bonus. In addition to the Base Salary, Executive
shall be eligible, as long as she holds the position stated in
paragraph 1, for a yearly cash bonus of up to 30% of Base Salary
based upon her performance in accordance with specific annual
objectives, set in advance, all as approved by the Board of
Directors.
4. Insurance and Benefits. Company shall allow Executive to
participate in each employee benefit plan and to receive each
executive benefit that Company provides for persons in Executive's
position.
5. Term. The term of this Agreement shall be for two (2)
years, beginning March 28, 1995, provided, however, that Company
may terminate this Agreement at any time upon thirty (30) days'
prior written notice (at which time this Agreement shall terminate
except for Section 9, which shall continue in effect as set forth
in Section 9). In the event of such termination by Company,
Executive shall be entitled to receive her Base Salary (at the rate
in effect at the time of termination) through the end of the term
of this Agreement. Such Base Salary shall be paid thereafter in
monthly installments. In addition, this Agreement shall terminate
upon the death of executive, except as to Executive's estate's
right to exercise any unexercised stock options pursuant to
Company's stock option plan then in effect, and except as to any
rights which Executive's estate or dependents may have under COBRA
or any other federal or state law or which are derived independent
of this Agreement by reason of her participation in any plan
maintained by Company.
6. Termination by Company for Cause. Company shall have the
right to terminate Executive's employment under this Agreement for
cause, in which event no compensation shall be paid or other
benefits furnished to Executive after termination for cause.
Termination for cause shall be effective immediately upon notice
sent or given to Executive. For purposes of this Agreement, the
term "cause" shall mean and be strictly limited to: (i) conviction
of Executive, after all applicable rights of appeal have been
exhausted or waived, for any crime involving moral turpitude or the
engaging by Executive in any unethical, immoral or fraudulent
conduct which materially discredits Company or is materially
detrimental to the reputation or goodwill of Company; (ii)
commission of any material act of fraud or dishonesty by Executive
against Company, provided that Executive shall first be provided
with written notice of the claim and with an opportunity to contest
said claim before the Board of Directors; or (iii) Executive's
material breach of her obligations under paragraph 2 of the
Agreement, as so determined by the Board of Directors.
(b) In the event that Executive's employment is
terminated, Executive agrees to resign as an officer and/or
director of Company (or any of its subsidiaries or affiliates),
effective as of the date of such termination, and Executive agrees
to return to Company upon such termination any of the following
which contain confidential information: all documents, instruments,
papers, facsimiles, and computerized information which are the
property of Company or such subsidiary or affiliate.
7. Change in Control. If Executive's employment is
terminated primarily as a result of a Change in Control of Company
or a Potential Change in Control of Company as defined below,
Executive shall receive her Base Salary (at the rate in effect at
the time of termination) for a period of two years or through the
end of the term of this Agreement, whichever is longer.
As used herein, the term "Change in Control" means the
happening of any of the following:
(a) Any person or entity, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, other than Company, a subsidiary of Company, or any
employee benefit plan of Company or its subsidiaries, becomes the
beneficial owner of Company's securities having 25 percent or more
of the combined voting power of the then outstanding securities of
Company that may be cast for the election for directors of Company
(other than as a result of an issuance of securities initiated by
Company in the ordinary course of business); or
(b) As the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, less than a majority of the combined voting
power of the then outstanding securities of Company or any
successor corporation or entity entitled to vote generally in the
election of directors of Company or such other corporation or
entity after such transaction, are held in the aggregate by holders
of Company's securities entitled to vote generally in the election
of directors of Company immediately prior to such transactions; or
(c) During any period of two consecutive years,
individuals who at the beginning of any such period constitute the
Board of Directors of Company cease for any reason to constitute at
least a majority thereof, unless the election, or the nomination
for election by Company's stockholders, of each director of Company
first elected during such period was approved by a vote of at least
two-thirds of the directors of Company then still in office who
were directors of Company at the beginning of any such period.
As used herein, the term "Potential Change in Control" means
the happening of any of the following:
(a) The approval by stockholders of an agreement by
Company, the consummation of which would result in a Change of
Control of Company; or
(b) The acquisition of beneficial ownership, directly or
indirectly, by any entity, person or group (other than Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
Company or its subsidiaries (including any trustee of such plan
acting as trustee) of securities of Company representing 5 percent
or more of the combined voting power of Company's outstanding
securities and the adoption by the Board of Directors of Company of
a resolution to the effect that a Potential Change in Control of
Company has occurred for purposes of this Plan.
8. Disability. If Executive becomes Disabled at any time
during the term of this Agreement, she shall after she becomes
disabled continue to receive all payments and benefits provided
under the terms of this Agreement for a period of twelve
consecutive months, or for the remaining term of this Agreement,
whichever period is shorter. In the event that Executive is
disabled for more than twelve consecutive months during the term of
this Agreement, executive shall, at the expiration of the initial
twelve consecutive month period, be entitled to receive under this
Agreement 50% of her Base Salary plus the insurance and benefits
described in Section 4 of this Agreement for the remaining term of
this Agreement. For purposes of this Agreement, the term disabled
shall mean the inability of Executive (as the result of a physical
or mental condition) to perform the duties of her position under
this Agreement with reasonable accommodation and which inability is
reasonably expected to last at least one (1) full year.
9. Non-competition; Unauthorized Disclosure.
(a) Non-competition. During the period Executive is
employed under this Agreement, and for a period of one year
thereafter, Executive:
(i) shall not engage in any activities, whether as
employer, proprietor, partner, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of
which are traded on a national securities exchange or in the
over-the-counter market, director, officer, employee or otherwise,
in competition with (i) the businesses conducted at the date hereof
by Company or any subsidiary or affiliate, or (ii) any business in
which Company or any subsidiary or affiliate is substantially
engaged at any time during the employment period;
(ii) shall not solicit, in competition with
Company, any person who is a customer of the businesses conducted
by Company at the date hereof or of any business in which Company
is substantially engaged at any time during the term of this
Agreement; and
(iii) shall not induce or attempt to persuade any
employee of Company or any of its divisions, subsidiaries or then
present affiliates to terminate her or her employment relationship
in order to enter into competitive employment.
(b) Unauthorized Disclosure. During the period
Executive is employed under this Agreement, and for a further
period of two years thereafter, Executive shall not, except as
required by any court or administrative agency, without the written
consent of the Board of Directors, or a person authorized thereby,
disclose to any person, other than an employee of Company or a
person to whom disclosure is reasonably necessary or appropriate in
connection with the performance by Executive of her duties as an
executive for Company, any confidential information obtained by him
while in the employ of Company; provided, however, that
confidential information shall not include any information now
known or which becomes known generally to the public (other than as
a result of unauthorized disclosure by Executive).
(c) Scope of Covenants; Remedies. The following
provisions shall apply to the covenants of Executive contained in
this Section 9:
(i) the covenants contained in paragraph (i) and
(ii) of Section 9(a) shall apply within all the territories in
which Company is actively engaged in the conduct of business while
Executive is employed under this Agreement, including, without
limitation, the territories in which customers are then being
solicited;
(ii) without limiting the right of Company to
pursue all other legal and equitable remedies available for
violation by Executive of the covenants contained in this Section
9, it is expressly agreed by Executive and Company that such other
remedies cannot fully compensate Company for any such violation and
that Company shall be entitled to injunctive relief to prevent any
such violation or any continuing violation thereof;
(iii) each party intends and agrees that if, in any
action before any court or agency legally empowered to enforce the
covenants contained in this Section 9, any term, restriction,
covenant or promise contained therein is found to be unreasonable
and accordingly unenforceable, then such term, restriction,
covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency; and
(iv) the covenants contained in this Section 9
shall survive the conclusion of Executive's employment by Company.
10. General Provisions.
(a) Notices. Any notice to be given hereunder by either
party to the other may be effected by personal delivery, in writing
or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the
parties at the addresses set forth below, but each party may change
her or its address by written notice in accordance with this
Section 10 (a). Notices shall be deemed communicated as of the
actual receipt or refusal of receipt.
If to Executive: Julia A. Bentley
5221 Crestwood Drive
Knoxville, TN 37914
If to Company: Proffitt's, Inc.
Post Office Box 9388
Alcoa, TN 37701
(b) Partial Invalidity. If any provision in this
Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remaining provisions shall,
nevertheless, continue in full force and without being impaired or
invalidated in any way.
(c) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Tennessee.
(d) Attorney's Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements in addition to
any other relief to which she or it may be entitled.
(e) Delegation of Duties. Executive may not delegate or
assign any of her duties or obligations hereunder and Company shall
have no right to assign this Agreement without Executive's express
written consent to such assignment. This Agreement shall inure to
the benefit of and bind the parties hereto and their respective
legal representatives, successors and assigns.
(f) Entire Agreement. Except for any prior grants of
options or other forms of incentive compensation evidenced by a
written instrument, this Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to employment of Executive by Company and contains all
of the covenants and agreements between the parties with respect to
such employment. Each party to this Agreement acknowledges that no
representations, inducements or agreements, oral or otherwise, that
have not been embodied herein, and no other agreement, statement or
promise not contained in this Agreement, shall be valid or binding.
Any modification of this Agreement will be effective only if it is
in writing signed by the party to be charged.
(g) No Conflicting Agreement. By signing this
Agreement, Executive warrants that she is not a party to any
restrictive covenant, agreement or contract which limits the
performance of her duties and responsibilities under this Agreement
or under which such performance would constitute a breach.
(h) Headings. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define
or limit the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
PROFFITT'S, INC.
BY: /s/ R. Brad Martin
R. Brad Martin
Chairman of the Board
/s/ Julia A. Bentley
Julia A. Bentley
Executive
EXHIBIT 10.56
EMPLOYMENT AGREEMENT OF
ANNE BREIER POPE
This Agreement is made and entered into as of March 7, 1995,
by and between PROFFITT'S, INC., a Tennessee corporation (the
"Company") and ANNE BREIER POPE, a Tennessee resident
("Employee").
The Company is a Tennessee corporation which owns and
operates department stores. The Company owns a controlling
interest in Parks-Belk Company.
The Company desires to employ Employee upon the terms and
conditions set forth herein, and Employee desires to accept such
employment.
NOW, THEREFORE, in consideration of the mutual covenants of
the parties made herein, it is hereby agreed as follows:
1. Employment and Duties. The Company hereby agrees to
employ the Employee and the Employee hereby accepts employment as
President of Parks-Belk Company, or such other position as
determined by the Company from time to time, and agrees to devote
her full efforts to the diligent and faithful performance of such
duties as the officers and/or the Board of Directors of the
Company may from time to time assign to her. The Employee shall
not, without the express prior consent of the Company, which
consent shall not be unreasonably withheld directly or indirectly
during the term of this Agreement, render services for
compensation to any person or firm except as an employee of the
Company.
2. Term. The term of this Agreement commences as of the
date of its execution and shall continue for a period of two (2)
years thereafter unless sooner terminated as hereinafter
provided.
3. Compensation. As compensation for services rendered
under this Agreement, Employee shall receive an annual salary of
$85,000.00. All compensation shall be subject to the customary
withholding taxes and other employment taxes as required with
respect to compensation paid by a corporation to an employee.
4. Termination. This Agreement may be terminated by
Employee upon the giving of thirty (30) days prior written notice
to the Company. The Company reserves the right to terminate the
Employee's employment hereunder without prior notice should any
of the following occur, each of which shall be deemed a valid
cause for termination:
(a) Employee's conviction of a felony or commission of
any other act abhorrent to the community which a reasonable
person would consider materially damaging to the reputation or
business of the Company, its successors or assigns.
(b) Employee's death during the term of this
Agreement.
Upon termination for either of the foregoing causes, the
Employee shall be entitled to receive only the compensation
accrued but unpaid as of the date of termination and shall not be
entitled to additional compensation except as expressly provided
in this Agreement.
5. Medical Insurance. During the term of this Agreement,
the Company shall provide Employee medical insurance coverage of
the same type available to full time employees of the Company or
its subsidiaries under the medical insurance program, if any, in
effect for full time employees. All such insurance shall be
provided to Employee at no charge; provided, however, Employee
shall be solely responsible for any deductible, co-payment, other
amounts payable by participants generally in such medical
insurance program and any payments required under the
Consolidated Omnibus Budget Reconciliation Act of 1984.
6. Injunctive Relief. The parties hereto agree that in
the event of a breach of any of the covenants contained herein,
there will be no adequate remedy at law and in the event of any
such breach, the non-breaching party shall be entitled to
injunctive and such other and further relief, including damages,
as may be proper.
7. Rights and Obligations of Successors. This Agreement
shall be assignable and tranferrable by the Company to any
subsidiary or affiliate of the Company and shall inure to the
benefit of and be binding upon the Company, its successors and
assigns. This Agreement shall not be assigned by the Employee,
as the parties agree that Employee's services are unique.
8. Entire Agreement. All prior conversations, discussions
and agreements between the parties herein are hereby merged into
and set forth in writing as part of this Agreement, which shall
constitute the entire agreement between the parties. The parties
hereby acknowledge that there have been no representations,
inducements, promises or agreements made by either party other
than those set forth herein.
9. Notices. All notices required or permitted to be given
under the terms of this Agreement shall be deemed given if in
writing, deposited in a sealed envelope, with postage prepaid
thereon, certified mail, return receipt requested, addressed to
either party, as the case may be, at the address set forth below:
If to the Company:
Proffitt's, Inc.
McRae's, Inc.
3455 Highway 80 West
Jackson, Mississippi 39209
Attention: Brian J. Martin, Esq.
If to the Employee:
Anne Breier Pope
2100 Bonaire Road
Kingsport, Tennessee 37660
10. Amendments and Modifications In Writing. No amendment
to or modification of this Agreement shall be effective unless it
is in writing and signed by duly authorized representatives of
both parties.
11. Controlling Law. This Agreement shall be governed,
construed, and enforced in accordance with the laws of the State
of Tennessee.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date set forth above.
PROFFITT'S, INC.
By: /s/ R. Brad Martin
R. Brad Martin, Chairman and
Chief Executive Officer
/s/ Anne Breier Pope
Anne Breier Pope
Executive
EXHIBIT 11.1
STATEMENT RE: COMPUTATION OF HISTORICAL EARNINGS PER COMMON SHARE
PROFFITT'S, INC. AND SUBSIDIARIES
(in thousands, except per share data)
YEAR ENDED
JANUARY 28, JANUARY 29, JANUARY 30,
1995 1994 1993
PRIMARY:
Average shares outstanding 9,784 9,051 6,455
Net effect of dilutive stock
options - based on the treasury
stock method using average market
price 128 185 136
TOTAL 9,912 9,236 6,591
Income before cumulative effect
of changes in accounting methods $ 16,128 $ 5,730 $6,747
Less preferred dividends (1,694) 0 0
Income before cumulative effect of
changes in accounting methods
available for common $ 14,434 $ 5,730 $6,747
Cumulative effect of changes in
accounting methods:
Inventory costing 0 702 0
Store pre-opening 0 (369) 0
Net income $ 14,434 $ 6,063 $6,747
Earnings per common share before
cumulative effect of changes in
accounting methods: $ 1.46 $ 0.62 $ 1.02
Cumulative effect of changes in
accounting methods:
Inventory costing 0.00 0.08 0.00
Store pre-opening 0.00 (0.04) 0.00
Fully diluted earnings per share $ 1.46 $ 0.66 $ 1.02
<PAGE>
EXHIBIT 11.1 (continued)
STATEMENT RE: COMPUTATION OF HISTORICAL EARNINGS PER COMMON SHARE
PROFFITT'S, INC. AND SUBSIDIARIES
(in thousands, except per share data)
YEAR ENDED
JANUARY 28, JANUARY 29, JANUARY 30,
1995 1994 1993
FULLY DILUTED:
Average shares outstanding 9,784 9,052 6,455
Net effect of dilutive stock
options - based on the treasury
stock method using year-end
market price if higher than
average price 131 185 241
Assumed conversion of 8%
subordinated debenture 0 52 313
Assumed conversion of 4.75%
subordinated debenture 2,020 512 0
Assumed conversion of preferred
stock 1,228 0 0
TOTAL 13,163 9,801 7,009
Income before interest adjustments
and cumulative effect of changes
in accounting methods $16,128 $ 5,730 $6,747
Add 8% convertible subordinated
debenture interest, net of federal
income tax effect 0 41 248
Add 4.75% convertible subordinated
debenture interest, net of federal
income tax effect 2,500 633 0
Adjusted net income before
cumulative effect of changes in
accounting methods $18,628 $ 6,404 $6,995
Cumulative effect of changes
in accounting methods:
Inventory costing 0 702 0
Store pre-opening 0 (369) 0
Adjusted net income $18,628 $ 6,737 $6,995
Fully diluted earnings per
common share before cumulative
effect of changes in accounting
methods: $ 1.42 $ 0.69 $ 1.00
Cumulative effect of changes
in accounting methods:
Inventory costing 0.00 0.07 0.00
Store pre-opening 0.00 (0.03) 0.00
Fully diluted earnings per share $ 1.42 $ 0.65 $ 1.00
Note/For each year shown, dilution is less than 3%; therefore, no fully diluted
presentation is needed.
EXHIBIT 13.1
FIVE-YEAR FINANCIAL SUMMARY
Proffitt's, Inc. and Subsidiaries
(In thousands, except per share amounts)
52 WEEKS 52 WEEKS 52 WEEKS 52 WEEKS 52 WEEKS
ENDED ENDED ENDED ENDED ENDED
JANUARY JANUARY JANUARY FEBRUARY FEBRUARY
28, 1995 29, 1994 30, 1993 1, 1992 2, 1991
CONSOLIDATED INCOME STATEMENT DATA:
Net sales, including
leased departments $617,363 $200,884 $128,262 $104,873 $98,767
Costs and expenses:
Cost of sales 400,605 129,679 78,225 64,673 60,878
Selling, general,
and administrative
expenses (including
store pre-opening
expenses) 145,560 49,851 31,834 27,539 26,213
Other operating expenses 43,711 15,754 8,793 7,303 7,109
Operating income 27,487 5,600 9,410 5,358 4,567
Other income (expense):
Finance charge income,
net of allocation to
purchaser of accounts
receivable 13,653 5,964 4,457 4,030 4,005
Interest expense (15,655) (2,976) (2,881) (4,616) (5,404)
Other income (expense),
net 1,109 805 (109) 92 194
Income before provision
for income taxes and
cumulative effect of
changes in accounting
methods 26,594 9,393 10,877 4,864 3,362
Provision for income taxes 10,466 3,663 4,130 1,851 1,297
Income before cumulative
effect of changes in
accounting methods 16,128 5,730 6,747 3,013 2,065
Cumulative effect of changes
in accounting methods
(net of tax) 333
Net income $16,128 $6,063 $6,747 $3,013 $2,065
Earnings per common share
before cumulative effect
of changes in accounting
methods $1.46 $.62 $1.02 $.78 $.55
Earnings per common share $1.46 $.66 $1.02 $.78 $.55
Weighted average number of
common shares outstanding 9,912 9,236 6,591 3,858 3,787
JANUARY JANUARY JANUARY FEBRUARY FEBRUARY
28, 1995 29, 1994 30, 1993 1, 1992 2, 1991
CONSOLIDATED BALANCE SHEET DATA:
Trade accounts receivable,
less allowance for
doubtful accounts $2,701 $38,652 $33,556 $22,713 $22,617
Working capital $103,139 $121,357 $48,538 $47,019 $34,621
Total assets $540,055 $259,881 $133,502 $97,941 $88,657
Senior long-term debt,
less current portion $114,102 $24,968 $43,086 $27,215 $49,068
Subordinated debt $100,269 $86,250
Shareholders' equity $180,676 $124,043 $61,627 $54,467 $22,204
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
Proffitt's, Inc. is a leading regional specialty department store
chain offering moderate to better brand name fashion apparel,
accessories, cosmetics, and decorative home furnishings. The
Company's stores are primarily anchor stores in leading regional
malls.
On March 31, 1994, Proffitt's, Inc. acquired all of the outstanding
common stock of Macco Investments, Inc., a holding company for
McRae's, Inc., a retail department store chain headquartered in
Jackson, Mississippi. Proffitt's, Inc. currently operates its
Proffitt's Division with 25 department stores located in Tennessee,
Virginia, North Carolina, Georgia, and Kentucky and its McRae's
Division with 28 department stores and one home furnishings
specialty store located in Mississippi, Alabama, Louisiana, and
Florida.
In 1992 and 1993, Proffitt's, Inc. acquired 18 store locations from
the Hess Department Store Company. These stores were renovated and
opened as Proffitt's stores throughout 1992 and 1993.
Income statement information for the year ended January 28, 1995
includes operations from the Proffitt's Division for the entire
year and operations from the McRae's Division after March 31, 1994.
The following table sets forth, for the periods indicated, certain
items from the Company's Consolidated Statements of Income,
expressed as percentages of net sales:
52 WEEKS 52 WEEKS 52 WEEKS
ENDED ENDED ENDED
JANUARY 28, JANUARY 29, JANUARY 30,
1995 1994 1993
Net sales 100.0% 100.0% 100.0%
Costs and expenses:
Cost of sales 64.9 64.6 61.0
Selling, general, and
administrative expenses 23.6 22.3 24.7
Store pre-opening expenses 2.5 0.1
Other operating expenses:
Property and equipment
rentals 1.9 2.3 1.9
Depreciation and
amortization 3.0 3.1 2.6
Taxes other than income
taxes 2.2 2.4 2.3
Operating income 4.4 2.8 7.4
Other income (expense):
Finance charge income, net
of allocation to purchaser
of accounts receivable 2.2 3.0 3.5
Interest expense (2.5) (1.5) (2.3)
Other income (expense), net 0.2 0.4 (0.1)
Income before provision
for income taxes and
cumulative effect of
changes in accounting
methods 4.3 4.7 8.5
Provision for income taxes 1.7 1.8 3.2
Income before cumulative
effect of changes in
accounting methods 2.6 2.9 5.3
Cumulative effect of changes
in accounting methods
(net of tax) 0.1
Net income 2.6% 3.0% 5.3%
<PAGE>
NET SALES
Total Company net sales increased by 207%, 57%, and 22% in 1994,
1993, and 1992, respectively. The 1994 sales increase was due to
revenues of $379.1 million generated from the McRae's Division
acquired in March 1994, along with a comparable store sales
increase of 3% and volume generated from new stores opened in 1993
not reflected in the comparable stores sales gain. The 1993
increase was attributable to a comparable store net sales increase
of 14% combined with the opening of eleven stores and renovation
and expansion of five other stores during the year.
Net Sales
1994 $617.40 million
1993 $200.9 million
1992 $128.3 million
1991 $104.9 million
1990 $98.8 million
GROSS MARGINS
Gross margins were 35.1%, 35.4%, and 39.0% in 1994, 1993, and 1992,
respectively. Effective January 31, 1993, the Company changed its
method of accounting for inventory to a full-cost method which
includes certain purchasing and distribution costs. Those costs
related to obtaining merchandise and preparing it for sale were
classified in selling, general, and administrative expenses in 1992
but were classified as cost of sales in 1994 and 1993, thereby
lowering the 1994 and 1993 gross margin percent by 2.3% and 1.7%,
respectively. Without this change, gross margin percent would have
been 37.4% in 1994 and 37.1% in 1993. The decrease in gross margin
percent from 39.0% in 1992 to 37.1% in 1993 and 37.4% in 1994
(before reflecting the change in accounting method) was primarily
a result of excessive markdowns taken in fall 1993 and spring 1994
resulting from overstocking of new store locations in 1993 and
weakness in women's apparel sales in 1993 and 1994.
At January 28, 1995, management believes the Company's inventories
were well balanced and appropriately assorted and therefore
anticipates gross margins will continue to improve in 1995.
SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES
The change in accounting method relating to inventory costing (see
"Gross Margins") decreased selling, general, and administrative
expenses by 2.4% of sales in 1994 and by 2.1% of sales in 1993.
Without this change, selling, general, and administrative expenses
would have been 26.0% of sales in 1994 and 24.4% of sales in 1993
compared to 24.7% in 1992. The increase as a percentage of net
sales in 1994 primarily was due to the acquisition of McRae's and
additional overhead and other expenses required to operate the
expanded store base. The decline as a percentage of net sales in
1993 from the 1992 level primarily resulted from increased
economies of scale and the successful implementation of a
Company-wide program to control operating expenses.
The Company is consolidating certain administrative support areas
for the Proffitt's and McRae's Divisions (accounting, credit, and
management information systems) during spring 1995. The Company
anticipates further leverage of selling, general, and
administrative expenses in 1995 due to these consolidations,
increased sales volume, and continued expense control efforts.
STORE PRE-OPENING EXPENSES
The Company opened eleven new stores in 1993 and incurred
significant store pre-opening expenses. Store pre-opening expenses
totaled $5.0 million in 1993 and were immaterial in 1992 and 1994.
Effective January 31, 1993, the Company changed its method of
accounting for pre-opening costs to expensing such costs when
incurred. Previously, pre-opening costs were deferred and
amortized over the twelve months immediately following the store
openings.
OTHER OPERATING EXPENSES
Other operating expenses were 7.1% of net sales in 1994, compared
to 7.8% in 1993 and 6.8% in 1992. The percent decline in 1994 over
1993 resulted from leverage of these expenses over a larger sales
base, primarily due to the addition of the McRae's stores. The
increase in 1993 over prior year levels was primarily attributable
to additional depreciation and building rent expense related to new
stores placed in service throughout 1993 and 1992.
FINANCE CHARGE INCOME
Finance charge income was 2.2% of net sales in 1994 compared with
3.0% in 1993 and 3.5% in 1992. The decline from 1993 to 1994 was
due to the allocation to the third party purchaser of accounts
receivable (see "Liquidity") of finance charges of approximately
$5.6 million, or 0.9% of sales for the year. There was no such
allocation in prior years. For 1994, gross finance charge income
(before allocation to third party) was essentially level with the
prior year as a percent of sales. The decrease in 1993 from the
1992 level as a percent of sales was primarily due to increased
customer usage of third party charge cards and to the
underdeveloped customer charge account bases of the Company's
proprietary charge cards in new markets.
INTEREST EXPENSE
Interest expense as a percentage of net sales was 2.5% for 1994,
1.5% for 1993, and 2.3% for 1992. Total interest expense was $15.7
million, $3.0 million, and $2.9 million in 1994, 1993, and 1992,
respectively. The significant increase in interest expense in 1994
over prior year levels was attributable to higher borrowings
associated with the purchase and operation of new stores in 1993
and the acquisition of McRae's in 1994.
INCOME TAXES
During 1994, 1993, and 1992, effective income tax rates were 39.4%,
39.0%, and 38.0%, respectively.
NET INCOME
Net income was $16.1 million in 1994, $6.1 million in 1993, and
$6.7 million in 1992, which represents 2.6%, 3.0%, and 5.3% of net
sales, respectively. Net income in 1994 rose over 1993 and 1992
levels due to additional sales and gross margin dollars primarily
generated from the McRae's Division and having a complete year of
operations from the new stores opened during 1993. As a percent of
sales, net income was lower in 1994 and 1993 from 1992 due to gross
margin and expense factors previously discussed.
Net Income
1994 $16.128 million
1993 $6.063 million
1992 $6.747 million
1991 $3.013 million
1990 $2.065 million
INFLATION
Inflation affects the costs incurred by the Company in its purchase
of merchandise and in certain components of its selling, general,
and administrative expenses. The Company attempts to offset the
effects of inflation through price increases and control of
expenses, although the Company's ability to increase prices is
limited by competitive factors in its markets.
SEASONALITY
The Company's business, like that of most retailers, is subject to
seasonal influences, with a significant portion of net sales and
net income realized during the fourth quarter of each year, which
includes the Christmas selling season. In light of this pattern,
selling, general, and administrative expenses are typically higher
as a percentage of net sales during the first three quarters of
each year, and working capital needs are greater in the last
quarter of each year. The fourth quarter increases in working
capital needs have typically been financed with internally
generated funds and borrowings under the Company's revolving credit
facility. Generally, more than 30% of the Company's net sales and
over 50% of net income are generated during the fourth quarter.
LIQUIDITY
The Company's primary needs for liquidity are to acquire, renovate,
or construct stores, to provide working capital for new and
existing stores, and to repay borrowings.
Net cash provided by operating activities was $111.3 million in
1994; net cash used in operating activities was $39.8 million and
$1.3 million in 1993 and 1992, respectively. The net cash provided
in 1994 was primarily due to the Company's profitable operations,
the sale of ownership interests in the Company's accounts
receivable (see below), and a reduction in inventory levels in the
Company's existing store base over the prior year. The cash used
in 1993 was primarily related to the building of inventories and
trade receivables for newly opened stores.
Net cash used in investing activities for 1994 totaled $210.3
million, of which $184.1 million was for the purchase of Macco
Investments, Inc. and $24.5 million was related to store renovation
and construction, management information systems enhancements, and
other capital expenditures. Net cash used in investing activities
for 1993 and 1992 totaled $62.6 million and $30.7 million,
respectively, and was primarily for purchases of property and
equipment and renovations related to the Hess locations.
Net cash provided by financing activities for 1994 totaled $85.0
million which was primarily a result of proceeds from long-term
borrowings and the issuance of a $30 million convertible preferred
security (see below) netted against debt and capital lease payments
of $29.2 million. Net cash provided by financing activities for
1993 totaled $117.0 million which was primarily from the proceeds
of the $86.3 million subordinated debentures (discussed below),
other long-term borrowings, and the $50.2 million public stock
offering (discussed below) netted against debt repayments. Net
cash provided by financing activities for 1992 totaled $23.1
million which was primarily from the net proceeds of long-term
borrowings.
In February and March 1993, the Company sold 2.4 million shares of
Common Stock to the public. Net proceeds to the Company were
approximately $50.2 million after deduction of the underwriting
discount and offering expenses. In October and November 1993, the
Company issued 4.75% convertible subordinated debentures due in
2003. Net proceeds to the Company were approximately $83.5 million
after deduction of the underwriting discount and offering expenses.
On March 31, 1994, Proffitt's, Inc. acquired all of the outstanding
common stock of Macco Investments, Inc., a holding company for
McRae's, Inc., a retail department store chain with 28 stores
headquartered in Jackson, Mississippi. Additionally, the Company
purchased four regional mall stores owned by McRae family
partnerships, which were leased to McRae's.
The consideration paid for the purchase of the McRae's shares
consisted of $176 million in cash and $34 million in non-cash
consideration, comprised primarily of $17.5 million of 7.5% junior
subordinated debentures and equity-related securities. The Company
also assumed $96 million in existing accounts receivable financing,
long-term debt, and capital leases. The purchase price for the
four stores owned by the McRae family partnerships totaled $18
million.
The financing of the transaction and the combined business included
a $175 million facility with a financial institution for the sale
of ownership interests in accounts receivable ("Accounts Receivable
Facility"), a $125 million revolving credit facility with several
banks ("Revolver"), and $20 million of mortgage financing on
certain Proffitt's and McRae's properties. The Accounts Receivable
Facility requires that a portion of finance charges earned be
allocated to the purchaser of the ownership interests in the
accounts receivable, sufficient to cover the yield on commercial
paper utilized by the purchaser to finance the transaction, plus
fees and expenses. The Revolver provides various borrowing
options, including prime rate and LIBOR-based rates.
Book Value Per Common Share
1994 $15.23 million
1993 $13.35 million
1992 $9.48 million
1991 $8.45 million
1990 $5.86 million
Several of the Company's financing agreements limit the Company's
additional borrowing and capital lease obligations and require the
maintenance of, among other things, various financial ratios and
minimum levels of net worth. The agreements also restrict capital
expenditures and purchases of Common Stock.
To further strengthen the balance sheet of the combined Company,
concurrent with the closing of the acquisition, Proffitt's, Inc.
issued a privately placed, $30 million, 6.5% convertible preferred
security.
As of March 15, 1995, the interest rate on the $175 million
Accounts Receivable Facility was 6.7%. As of March 15, 1995,
$125.1 million was drawn on the Accounts Receivable Facility. The
maximum drawn on the Accounts Receivable Facility during 1994
totaled $143.9 million. Amounts drawn on the Accounts Receivable
Facility are limited to between 94% and 96% of total accounts
receivable.
As of March 15, 1995, the interest rate on the $125 million
Revolver was 7.4%. Borrowings on the Revolver are limited to 50%
of merchandise inventories. As of March 15, 1995, the Company had
borrowings totaling $58.8 million outstanding under the Revolver
and unused availability of $29.5 million. The maximum amount
outstanding under the Revolver during 1994 was $87.4 million. At
that time, the Company had unused availability on the Revolver of
$37.6 million.
At January 28, 1995, total debt was 57% of total capitalization.
Excluding the subordinated debentures, which the Company considers
permanent capital, senior debt was 33% of total capitalization.
The Company estimates total capital expenditures for the combined
organization in 1995 will be approximately $25 million, primarily
for the relocation of one store, the renovation of several other
stores, and enhancements in point-of-sale equipment and management
information systems.
On March 7, 1995, the Company acquired the majority interest
(50.1%) of Parks-Belk Company ("Parks-Belk"), the owner and
operator of four department stores in northeast Tennessee.
Specific terms of the transaction were not disclosed, but
consideration was paid in Proffitt's Common Stock and cash and was
less than $10 million. The Company currently is negotiating to
purchase the remaining stock of Parks-Belk. The Company estimates
capital expenditures for renovations to these store locations will
be immaterial.
The Company anticipates its capital expenditures and working
capital requirements relating to planned new and existing stores
will be funded through cash provided by operations, borrowings, and
cash reserves. The Company expects to generate adequate cash flows
from operating activities to sustain current levels of operations.
The Company maintains favorable banking relations and anticipates
the necessary credit agreements will be extended or new agreements
will be entered into in order to provide future borrowing
requirements as needed.
RECENT ACCOUNTING PRONOUNCEMENTS
There are no recent accounting pronouncements that will have a
significant impact on the Company's financial statements.
Shareholder's Equity
1994 $180.5 million
1993 $124.0 million
1992 $61.6 million
1991 $54.5 million
1990 $22.2 million
<PAGE>
MARKET INFORMATION
The Company's Common Stock trades on the NASDAQ Stock Market under
the symbol PRFT. As of March 15, 1995, there were approximately
630 shareholders of record. Below is a summary of the high and low
bid quotations for the Company's Common Stock for each quarterly
period for the prior two years. The source of these quotations is
the Monthly Statistical Report of the National Association of
Securities Dealers, Inc. These quotations represent inter-dealer
prices for actual transactions, without adjustment for retail
markup, markdown, or commission.
The Company presently follows the policy of retaining earnings to
provide funds for the operation and expansion of the business and
has no present intention to declare cash dividends in the
foreseeable future. Future dividends, if any, will be determined
by the Board of Directors of the Company in light of circumstances
then existing, including the earnings of the Company, its financial
requirements, and general business conditions. The Company
declared no dividends to common shareholders in either 1994 or
1993.
FISCAL YEAR ENDED
JANUARY 28, 1995 JANUARY 29, 1994
PRICE RANGE PRICE RANGE
QUARTER HIGH LOW HIGH LOW
First 25 3/4 16 1/2 26 1/2 21 1/2
Second 19 3/4 14 3/4 27 1/4 21 3/4
Third 21 3/4 14 3/4 36 3/4 23 1/2
Fourth 25 1/4 17 3/4 35 1/2 18 1/4<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
Board of Directors
Proffitt's, Inc.
We have audited the accompanying consolidated balance sheets of
Proffitt's, Inc. and subsidiaries as of January 28, 1995 and
January 29, 1994, and the related consolidated statements of
income, shareholders' equity and cash flows for each of the three
years in the period ended January 28, 1995. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the consolidated financial
position of Proffitt's, Inc. and subsidiaries at January 28, 1995
and January 29, 1994 and the consolidated results of their
operations and their cash flows for each of the three years in the
period ended January 28, 1995, in conformity with generally
accepted accounting principles.
As described in Note M to the financial statements, the Company
changed its method of costing inventory, accounting for store pre-
opening expenses and accounting for income taxes in the year ended
January 29, 1994 and changed its method of valuing inventory in the
year ended January 28, 1995.
COOPERS & LYBRAND L.L.P.
Knoxville, Tennessee
March 17, 1995
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
Our report on the consolidated financial statements of Proffitt's,
Inc. has been incorporated by reference in this Form 10-K from page
26 of the 1994 Annual Report to Shareholders of Proffitt's, Inc.
In connection with our audits of such financial statements, we have
also audited the related financial statement schedule listed in
Item 14(a)2 of this Form 10-K.
In our opinion, the financial statement schedule referred to above,
when considered in relation to the basic financial statements taken
as a whole, presents fairly, in all material respects, the
information required to be included therein.
COOPERS & LYBRAND L.L.P.
Knoxville, Tennessee
March 17, 1995
<PAGE>
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
Proffitt's, Inc. and Subsidiaries
YEAR ENDED
JANUARY 28, JANUARY 29, JANUARY 30,
1995 1994 1993
NET SALES $617,363 $200,884 $128,262
COSTS AND EXPENSES
Cost of sales 400,605 129,679 78,225
Selling, general, and
administrative expenses 145,560 44,871 31,728
Store pre-opening expenses 4,980 106
Other operating expenses:
Property and equipment
rentals 11,616 4,638 2,480
Depreciation and
amortization 18,397 6,290 3,401
Taxes other than income
taxes 13,698 4,826 2,912
OPERATING INCOME 27,487 5,600 9,410
OTHER INCOME (EXPENSE)
Finance charge income -
Note C 13,653 5,964 4,457
Interest expense (15,655) (2,976) (2,881)
Other income (expense), net 1,109 805 (109)
INCOME BEFORE PROVISION
FOR INCOME TAXES AND
CUMULATIVE EFFECT OF
CHANGES IN ACCOUNTING
METHODS 26,594 9,393 10,877
Provision for income taxes 10,466 3,663 4,130
INCOME BEFORE CUMULATIVE
EFFECT OF CHANGES IN
ACCOUNTING METHODS 16,128 5,730 6,747
Cumulative effect of changes
in accounting methods (net
of tax) - Note M:
Inventory costing 702
Store pre-opening (369)
NET INCOME 16,128 6,063 6,747
Preferred stock dividends 1,694
NET INCOME AVAILABLE TO
COMMON SHAREHOLDERS $ 14,434 $ 6,063 $ 6,747
Earnings per common share
before cumulative effect
of changes in accounting
methods $ 1.46 $ 0.62 $ 1.02
Cumulative effect of changes
in accounting methods:
Inventory costing .08
Store pre-opening (.04)
Earnings per common share -
Note A $ 1.46 $ 0.66 $ 1.02
Weighted average common shares 9,912 9,236 6,591
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
Proffitt's, Inc. and Subsidiaries
JANUARY 28, JANUARY 29,
1995 1994
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 1,133 $ 15,200
Trade accounts receivable, less
allowance for doubtful accounts
of $2,411 in 1994 and $1,195 in
1993 - Note C 2,701 38,652
Accounts receivable - other 7,648 7,278
Merchandise inventory 162,080 73,102
Prepaid supplies and expenses 5,827 1,534
Refundable income taxes 2,429
Deferred income tax asset - Note D 171 1,591
TOTAL CURRENT ASSETS 179,560 139,786
PROPERTY & EQUIPMENT, net of
depreciation - Notes B, E, and F 300,285 115,706
GOODWILL, net of amortization - Note B 44,624
OTHER ASSETS
Note receivable from related
party - Note I 500 500
Other assets 15,086 3,889
TOTAL ASSETS $540,055 $259,881
<PAGE>
JANUARY 28, JANUARY 29,
1995 1994
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Trade accounts payable $ 34,587 $ 6,963
Accrued expenses 21,436 6,468
Accrued compensation and related
items 4,980 1,641
Income taxes payable - Note D 149
Current portion of long-term debt
and capital lease obligations -
Notes F and G 15,269 3,357
TOTAL CURRENT LIABILITIES 76,421 18,429
REAL ESTATE AND MORTGAGE NOTES - Note F 64,726 20,968
NOTES PAYABLE - Note F 47,621 4,000
NOTES PAYABLE TO RELATED PARTY - Note I 1,755
CAPITAL LEASE OBLIGATIONS - Note G 11,319
DEFERRED INCOME TAXES - Note D 54,830 6,191
OTHER LONG-TERM LIABILITIES 2,438
SUBORDINATED DEBENTURES - Note H 98,632 86,250
SUBORDINATED DEBENTURES TO RELATED
PARTY - Note H 1,637
COMMITMENTS - Note G
SHAREHOLDERS' EQUITY
Preferred Stock, $1.00 par value,
10,000 total shares authorized:
Series A - 600 shares authorized,
issued, and outstanding, $50 per
share liquidation preference 28,850
Series B - 33 shares authorized,
no shares issued
Common Stock, $.10 par value, 100,000
shares authorized, 9,971 and 9,293
shares issued and outstanding at
January 28, 1995 and January 29,
1994, respectively 997 929
Additional paid-in capital 113,996 100,715
Retained earnings 36,833 22,399
TOTAL SHAREHOLDERS' EQUITY 180,676 124,043
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $540,055 $259,881
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(in thousands of dollars)
Proffitt's, Inc. and Subsidiaries
PREFERRED STOCK
SERIES A SERIES B
Balance at February 1, 1992 $ - $ -
Net income
Issuance of Common Stock
Balance at January 30, 1993
Net income
Issuance of Common Stock
Income tax benefits related
to exercised stock options
Balance at January 29, 1994
Net income
Issuance of shares - Note B 28,850 3,296
Conversion of Series B
Preferred Stock (3,296)
Preferred dividends
Balance at January 28, 1995 $28,850 $ -
(TABLE CONTINUED)
ADDITIONAL TOTAL
COMMON PAID-IN RETAINED SHAREHOLDERS'
STOCK CAPITAL EARNINGS EQUITY
Balance at February 1, 1992 $644 $ 44,234 $ 9,589 $ 54,467
Net income 6,747 6,747
Issuance of Common Stock 6 407 413
Balance at January 30, 1993 650 44,641 16,336 61,627
Net income 6,063 6,063
Issuance of Common Stock 279 55,611 55,890
Income tax benefits related
to exercised stock options 463 463
Balance at January 29, 1994 929 100,715 22,399 124,043
Net income 16,128 16,128
Issuance of shares - Note B 52 10,001 42,199
Conversion of Series B
Preferred Stock 16 3,280
Preferred dividends (1,694) (1,694)
Balance at January 28, 1995 $997 $113,996 $36,833 $180,676
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of dollars)
Proffitt's, Inc. and Subsidiaries
YEAR ENDED
JANUARY JANUARY JANUARY
28, 1995 29, 1994 30, 1993
OPERATING ACTIVITIES
Net income $ 16,128 $ 6,063 $ 6,747
Adjustments to reconcile net income
to net cash provided by (used in)
operating activities:
Cumulative effect of changes in
accounting methods, before
income taxes (547)
Depreciation and amortization 19,102 6,556 3,510
Deferred income taxes 3,850 1,652 230
Other 289 490 520
Changes in operating assets and
liabilities:
Trade accounts receivable 65,577 (10,134) (5,805)
Merchandise inventory 15,230 (36,407) (10,473)
Prepaid expenses and other
current assets 1,356 (4,952) (982)
Other assets (146) (43)
Accounts payable, accrued
expenses, and income taxes
payable (10,223) (2,332) 5,017
NET CASH PROVIDED BY
(USED IN) OPERATING
ACTIVITIES 111,309 (39,757) (1,279)
INVESTING ACTIVITIES
Purchases of property and equipment, net (24,505) (64,095) (24,735)
Expenditure for acquired receivables (10,857)
Collections of acquired receivables 5,038 5,819
Acquisition of Macco Investments, Inc. (184,067)
Other (1,761) (3,541) (921)
NET CASH USED IN INVESTING
ACTIVITIES (210,333) (62,598) (30,694)
FINANCING ACTIVITIES
Issuance of convertible subordinated
debentures 86,250
Payments of deferred financing fees (2,895) (229)
Proceeds from long-term borrowings 85,679 63,395 25,053
Payments on long-term debt and
capital lease obligations (29,244) (80,596) (2,111)
Proceeds from issuance of stock 29,410 50,862 356
Dividends paid to preferred shareholders (888)
NET CASH PROVIDED BY FINANCING
ACTIVITIES 84,957 117,016 23,069
(DECREASE) INCREASE IN CASH
AND CASH EQUIVALENTS (14,067) 14,661 (8,904)
Cash and cash equivalents at beginning
of year 15,200 539 9,443
Cash and cash equivalents at end of year $ 1,133 $ 15,200 $ 539
Noncash investing and financing activities are described in Notes
B, D, and F.
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts)
Proffitt's, Inc. and Subsidiaries
NOTE A - DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
DESCRIPTION OF BUSINESS
At January 28, 1995, the Company operated twenty-five Proffitt's
specialty retail department stores located in Tennessee, Georgia,
North Carolina, Kentucky, and Virginia; twenty-eight McRae's
specialty department stores located in Mississippi, Alabama,
Florida, and Louisiana; and one specialty home store. The
Company's fiscal year ends on the Saturday nearest January 31 and
consisted of 52 weeks for the years ended January 28, 1995, January
29, 1994, and January 30, 1993.
CONSOLIDATION
The financial statements include the accounts of the Company and
its wholly-owned subsidiaries. On March 31, 1994, the Company
acquired Macco Investments, Inc., the parent company of McRae's,
Inc. (collectively McRae's). The operations of McRae's and its
subsidiaries are included after March 31, 1994 (see Note B).
REVENUES
Retail sales are recorded on the accrual basis, and profits on
installment sales are recognized in full when the sales are
recorded. Sales are net of returns.
TRADE ACCOUNTS RECEIVABLE
Trade accounts consist of revolving charge accounts with terms
which, in some cases, provide for payments exceeding one year. In
accordance with usual industry practice, such receivables are
included in current assets. Finance charge income is accrued
monthly as a percentage of uncollected customer account balances.
Beginning in April 1994, a portion of finance charge income is
earned by a financial institution in connection with the sale of
interests in accounts receivable (see Note C).
INVENTORIES
Inventories are valued at the lower of cost or market as determined
by the retail inventory method applied on the last-in, first-out
(LIFO) method for approximately 76% of the inventories at January
28, 1995 and on the first-in, first-out (FIFO) method for the
balance. Prior to the fiscal year ended January 28, 1995, the
Company used the FIFO method for all inventories. As of January
28, 1995, the carrying value of inventory approximated its current
replacement costs.
Prior to January 31, 1993, inventory costs consisted only of
"direct costs," principally invoice cost plus freight. Effective
January 31, 1993, the Company adopted the "full cost" method.
Under the full cost method, inventory costs include the direct
costs plus certain purchasing and distribution costs. The impact
of this change is further discussed in Note M.
PROPERTY AND EQUIPMENT
Property and equipment are stated at cost. Depreciation is
computed using the straight-line method for financial reporting
purposes over the estimated useful lives of the assets, which are
45 years for buildings and range from 4 to 20 years for fixtures,
leasehold improvements, and equipment.
CASH EQUIVALENTS
The Company considers all highly liquid investments purchased with
maturities of three months or less to be cash equivalents.
LEASED DEPARTMENT SALES
The Company includes leased department sales as part of net sales.
Leased department sales were $21,775, $3,308, and $2,562 for the
years ended January 28, 1995, January 29, 1994, and January 30,
1993, respectively.
STORE PRE-OPENING EXPENSES
Prior to January 31, 1993, new store pre-opening costs were
deferred and amortized over the 12 months immediately following the
individual store openings. Effective January 31, 1993, the Company
changed its method to expense such costs when incurred. The impact
of this change is further discussed in Note M.
INCOME TAXES
Prior to January 31, 1993, deferred income taxes were provided
under the "deferred method" to reflect the tax consequences of
timing differences between amounts reported for financial
accounting purposes and income tax purposes. Effective January 31,
1993, the Company adopted the "asset and liability method" which
recognizes deferred tax assets and liabilities for the differences
between the financial statement carrying amounts and tax bases of
assets and liabilities using enacted tax rates in effect in the
years in which the differences are expected to reverse. The impact
of this change is further discussed in Note M.
EARNINGS PER COMMON SHARE
Earnings per common share have been computed based on the weighted
average number of common shares outstanding, including common stock
equivalents, after recognition of preferred stock dividends of
$1,694 for the year ended January 28, 1995. There were no
preferred dividends in prior years. The weighted average number of
common shares outstanding was 9,912 for the year ended January 28,
1995, 9,236 for the year ended January 29, 1994, and 6,591 for the
year ended January 30, 1993.
The Company's 4.75% convertible subordinated debentures issued in
October 1993 and 7.5% junior subordinated debentures issued in
March 1994 are not common stock equivalents, and therefore, shares
issuable upon their conversion are included only in the computation
of fully diluted earnings per share. The difference between
primary and fully diluted earnings per share was not significant in
any year.
GOODWILL
In connection with the March 31, 1994 acquisition of McRae's, the
Company has classified as goodwill the cost in excess of fair value
of the net assets acquired. Goodwill is being amortized on a
straight-line method over 40 years, and the Company recognized
amortization charges of $949 during 1994. At each balance sheet
date, the Company evaluates the realizability of goodwill based
upon expectations of nondiscounted cash flows and operating income.
Based upon its most recent analysis, the Company believes that no
material impairment of goodwill exists at January 28, 1995.
NOTE B - ACQUISITION
On March 31, 1994, the Company acquired all of the common stock of
Macco Investments, Inc. (Macco), a privately held corporation and
the parent company of McRae's, Inc. (McRae's). The total
acquisition price of approximately $212 million consisted of a cash
payment of $176 million and the issuance of (i) 436 shares of
Proffitt's, Inc. Common Stock, (ii) the Company's 7.5% Junior
Subordinated Debentures due March 31, 2004 in an aggregate face
amount equal to $17.5 million, (iii) 33 shares of Series B
Cumulative Junior Perpetual Preferred Stock, (iv) the Company's
promissory notes to certain of the Macco shareholders for $2
million, and (v) transaction costs of approximately $6 million. In
addition and in connection with the acquisition, the Company
purchased four regional mall stores owned by McRae family
partnerships and leased to McRae's for $18.5 million.
McRae's was a privately-owned regional specialty department store
company, offering moderate to upper-moderate brand name and private
label fashion apparel, shoes, accessories, cosmetics, and home
furnishings. McRae's operates 28 department stores in Mississippi,
Alabama, Louisiana, and Florida. The Company now operates two
divisions: the Proffitt's Stores Division and the McRae's Stores
Division.
The financing of the acquisition included a $175 million accounts
receivable financing program through a financial institution; a
$125 million bank revolving credit facility; $20 million of
mortgage financing on certain Proffitt's and McRae's properties;
and a private sale of $30 million Series A Cumulative Convertible
Exchangeable Preferred Stock.
The following unaudited pro forma summary presents the consolidated
results of operations as if the acquisition had occurred at the
beginning of the years presented and do not purport to be
indicative of what would have occurred had the acquisition been
made as of these dates or of results which may occur in the future.
Pro forma:
(Unaudited)
YEAR ENDED
JANUARY 28, JANUARY 29,
1995 1994
Net sales $680,405 $619,665
Income before cumulative effect
of changes in accounting methods $ 17,909 $ 20,214
Net income $ 17,909 $ 20,547
Earnings per common share before
cumulative effect of changes in
accounting methods $ 1.60 $ 1.86
Earnings per common share $ 1.60 $ 1.90
The allocation of the purchase price was as follows:
Working capital $ 68,396
Property and equipment 176,907
Goodwill 45,574
Other assets 10,409
Long-term debt (32,877)
Capital lease obligations (11,695)
Deferred income taxes (42,432)
Other long-term liabilities (2,484)
$ 211,798
NOTE C - SALE OF ACCOUNTS RECEIVABLE
On April 1, 1994, the Company sold an ownership interest in its
accounts receivable. The Company recognized no gain or loss on
this transaction. Under the agreement with the purchaser, which
expires March 1996, the purchaser's share of collections on
accounts may be remitted to the purchaser, or the Company, at its
option, may substitute newly created receivables and retain the
collections. The Company may obtain additional proceeds by
increasing the ownership interest transferred to the purchaser, or
reduce the purchaser's interest by remitting a portion of the
collections to the purchaser. The ownership interest which may be
transferred to the purchaser is limited to $175 million and is
further restricted on the basis of the level of eligible
receivables and a minimum ownership interest to be maintained by
the Company. The Company sold $333,473 of its accounts receivable
during 1994, and the ownership interest transferred to the
purchaser, which is reflected as a reduction of accounts
receivable, was $138,740 at January 28, 1995.
Finance charges to the Company's customers on the purchaser's
portion of receivables are used to cover the purchaser's borrowing
costs (the yield on commercial paper issued by the purchaser), fees
related to the level of the purchaser's investment, and related
expenses, including fees paid to the Company to service the
receivables. The balance of finance charges is retained by the
Company. Finance charges retained by the purchaser were $5,567 in
1994.
The Company is contingently liable for the collection of the
receivables sold. Management believes that the allowance for
doubtful accounts of $2,411 at January 28, 1995 is adequate for
losses under this recourse provision. The agreement contains
certain covenants requiring the maintenance of various financial
ratios. If these covenants are not met or if an event of default
was to occur, the purchaser could be entitled to terminate the
agreement.
NOTE D - INCOME TAXES
The components of income tax expense were as follows:
YEAR ENDED
JANUARY 28, JANUARY 29, JANUARY 30,
1995 1994 1993
Current:
Federal $ 5,109 $ 1,964 $ 3,281
State 1,507 260 619
6,616 2,224 3,900
Deferred:
Federal 3,348 1,375 216
State 502 277 14
3,850 1,652 230
$ 10,466 $ 3,876 $ 4,130
<PAGE>
The primary sources of significant timing differences for 1992
which gave rise to deferred taxes included depreciation expense,
inventory capitalization, deferred costs, and bad debts.
Components of the net deferred tax asset or liability recognized in
the consolidated balance sheets as of January 28, 1995 and January
29, 1994 were as follows:
JANUARY 28, JANUARY 29,
1995 1994
Current:
Deferred tax assets:
Allowance for doubtful accounts $ 809 $ 326
Other current assets 99
Tax credits 423 412
Accrued expenses 1,250 853
2,581 1,591
Deferred tax liabilities:
Inventory (2,410)
Net deferred tax asset $ 171 $ 1,591
Noncurrent:
Deferred tax assets:
Capital leases $ 837
Other long-term liabilities 951
1,788
Deferred tax liabilities:
Property and equipment (49,855) $ (6,134)
Other assets (5,406) (57)
Junior subordinated debentures (1,357)
(56,618) (6,191)
Net deferred tax liability $(54,830) $ (6,191)
Income tax expense varies from the amount computed by applying the
statutory federal income tax rate to income before taxes. The
reasons for this difference were as follows:
YEAR ENDED
JANUARY 28, JANUARY 29, JANUARY 30,
1995 1994 1993
Statutory rate 35.0% 34.0% 34.0%
State income taxes, net
of federal benefit 3.0 4.0 4.0
Other items, net 1.4 1.0
Effective rate 39.4% 39.0% 38.0%
During the year ended January 29, 1994, certain incentive and
nonqualified stock options (for income tax purposes) were
exercised. The difference between the purchase price of the stock
established at the date of grant and the fair value at date of
exercise was deducted as compensation for income tax purposes
without a corresponding expense recorded for financial reporting
purposes. The tax benefit of $463 relating to such was credited to
additional paid-in capital. There were no material amounts of such
options exercised during the years ended January 28, 1995 and
January 30, 1993.
The Company made income tax payments, net of refunds received, of
$9,764, $5,870, and $3,292 during the years ended January 28, 1995,
January 29, 1994, and January 30, 1993, respectively.
NOTE E - PROPERTY AND EQUIPMENT
A summary of property and equipment at January 28, 1995 and January
29, 1994 was as follows:
JANUARY 28, JANUARY 29,
1995 1994
Land and land improvements $ 38,848 $ 7,358
Buildings 123,319 43,547
Leasehold improvements 40,786 22,333
Fixtures and equipment 128,898 66,447
Construction in progress 9,265
341,116 139,685
Accumulated depreciation (40,831) (23,979)
$300,285 $115,706
NOTE F - SENIOR LONG-TERM DEBT
A summary of senior long-term debt at January 28, 1995 and January
29, 1994 was as follows:
JANUARY 28, JANUARY 29,
1995 1994
Real estate and mortgage notes,
interest ranging from 3.75% to
10.375%, maturing 1995 to 2008,
collateralized by property and
equipment with a carrying amount
of approximately $110,977 at
January 28, 1995 $ 73,791 $ 22,825
Subordinated notes payable to
individuals, interest at 12.00%,
maturing 1997, callable by the
holders with written notice six
months prior to payment date 5,266
Notes payable, interest ranging from
10.36% to 13.00%, maturing 1995 to 1998 4,888 5,500
Revolving credit agreement, interest
at 7.01% at January 28, 1995 45,000
128,945 28,325
Current portion (14,843) (3,357)
$114,102 $ 24,968
Real estate and mortgage notes include a note payable of $1,803 at
January 28, 1995, which is subject to call at any time after
February 1, 1997. Also, included are notes payable of $3,288 at
January 28, 1995, which are subject to call (with six months
notification) at any time after November 3, 1996.
In conjunction with a real estate mortgage note having a balance of
$7,650 at January 28, 1995, the Company entered into an interest
rate swap agreement for the management of interest rate exposure.
The differential to be paid or received is included in interest
expense. The agreement swaps the variable rate for a fixed rate of
5.7%. This agreement extends to June 30, 2003. The Company
continually monitors its position and the credit rating of the
interest rate swap counterparty. While the Company may be exposed
to credit losses in the event of nonperformance by the
counterparty, it does not anticipate such losses.
At January 28, 1995, the Company owed $45 million under a revolving
credit agreement (Revolver) with banks. Borrowings under the
Revolver are limited to 50% of merchandise inventories up to a
maximum borrowing of $125 million, and interest rate options are
based on the LIBOR rate and prime rate. The agreement expires in
1997 and subject to mutual agreement, can be extended for up to two
additional periods of one year each. In addition to certain
general requirements, the credit agreement requires the Company to
meet specific covenants related to current ratio, fixed charges,
funded debt, capitalization, and tangible net worth. Certain other
note agreements also impose restrictions and financial maintenance
requirements.
Maturities of long-term debt for the next five years, giving
consideration to lenders' call privileges, are as follows:
FISCAL YEAR END
1996 $ 14,843
1997 14,667
1998 57,600
1999 4,602
2000 21,434
The Company made interest payments of $13,090, $2,743, and $2,842
during the years ended January 28, 1995, January 29, 1994, and
January 30, 1993, respectively. Capitalized interest was $303 and
$787 for the years ended January 28, 1995 and January 29, 1994,
respectively. No material amount of interest was capitalized for
the year ended January 30, 1993.
NOTE G - LEASES
The Company is committed under long-term leases primarily for the
rentals of certain retail stores. The leases generally provide for
minimum annual rentals (including executory costs such as real
estate taxes and insurance) and contingent rentals based on a
percentage of sales in excess of stated amounts. Generally, the
leases have primary terms ranging from 20 to 30 years and include
renewal options ranging from 5 to 15 years.
At January 28, 1995, minimum rental commitments under capital
leases and operating leases with terms in excess of one year are as
follows:
FISCAL YEAR END CAPITAL LEASES OPERATING LEASES
1996 $ 2,179 $ 7,267
1997 2,179 7,006
1998 2,179 6,861
1999 2,179 6,472
2000 2,165 6,080
Thereafter 21,219 41,226
Total minimum rental commitments 32,100 $ 74,912
Estimated insurance, taxes,
maintenance, and utilities (7,863)
Net minimum rental commitments 24,237
Imputed interest (rates ranging
from 8.00% to 17.80%) (12,492)
Present value of net minimum
rental commitments 11,745
Less current installments of
capital lease obligations (426)
Capital lease obligations,
excluding current installments $ 11,319
Contingent rentals on capital leases were $213 in 1994.
Total rental expense for operating leases was as follows:
YEAR ENDED
JANUARY 28, JANUARY 29, JANUARY 30,
1995 1994 1993
Buildings:
Minimum rentals $ 8,549 $ 3,570 $ 1,684
Contingent rentals 2,244 953 721
Equipment 823 115 75
$11,616 $ 4,638 $ 2,480
NOTE H - SUBORDINATED DEBENTURES
In October 1993, the Company issued $86,250 of 4.75% convertible
subordinated debentures, due November 1, 2003, with interest due
semi-annually. The debentures are convertible into the Company's
Common Stock at any time prior to maturity, unless previously
redeemed, at a conversion price of $42.70 per share. The
debentures are redeemable for cash at any time on or after November
15, 1996, at the option of the Company at specified redemption
prices.
In March 1994, the Company issued 7.50% junior subordinated
debentures with a face value of $17,500. The debentures were
discounted to reflect their fair value and have an accreted
carrying value of $14,019 at January 28, 1995. A Director of the
Company owns $1,637 of these debentures.
During the year ended January 29, 1994, a $5,000 convertible
subordinated debenture was converted into Common Stock at a
conversion price of $16 per share.
NOTE I - RELATED PARTY TRANSACTIONS
In February 1989, the Company entered into an agreement with the
Chairman of the Board and Chief Executive Officer for an unsecured
$500 interest-free loan due January 31, 1999. The loan was made as
a supplement to this individual's base compensation, and interest
was imputed on this loan at 5.54% for 1994.
The Company is obligated under 6.50% second mortgage real estate
notes to a Director of the Company in the amount of $1,755.
NOTE J - STOCK OPTIONS
The Company's 1987 Stock Option Plan, as amended, provided for the
granting of options of Common Stock not to exceed 490 shares to
officers, key employees, and Directors. No additional options are
to be granted under the 1987 Plan. On March 1, 1994, the Company's
Board of Directors adopted the Proffitt's, Inc. 1994 Long-Term
Incentive Plan pursuant to which stock options, stock appreciation
rights, restricted shares of Common Stock, and performance units
may be awarded to officers, key employees, and Directors. This
Plan has available for grant 1,200 shares of Common Stock of the
Company.
Stock option activity was as follows:
SHARES STOCK OPTION PRICE RANGE
Balance at February 1, 1992 295 $ 5.250 $ 8.125
Granted 78 12.000
Exercised (53) 5.250 12.000
Balance at January 30, 1993 320 5.250 12.000
Granted 199 23.625 28.500
Exercised (81) 5.250 12.000
Balance at January 29, 1994 438 5.250 28.500
Granted 660 18.250 24.500
Exercised (70) 5.250 23.625
Cancelled (9) 12.000 23.625
Balance at January 28, 1995 1,019 5.250 28.500
At January 28, 1995, incentive stock options and nonqualified stock
options for 380 shares were exercisable.
NOTE K - STOCK TRANSACTIONS
In February and March 1993, the Company sold 2,395 shares of Common
Stock at $22.25 per share in a public offering. Net proceeds to
the Company were approximately $50.2 million after the underwriting
discount and offering expenses.
On March 31, 1994, the Company issued 600 shares of Series A
Cumulative Convertible Exchangeable Preferred Stock in a private
offering. Net proceeds to the Company were approximately $28.5
million after offering expenses. Dividends are cumulative and are
paid in March and September at $3.25 per annum per share (6.50%).
The Preferred Stock is convertible into Common Stock at a price of
$21.10 per share and has a liquidation preference of $50 per share.
The Company may redeem the stock, in whole or in part, at $52.50
per share after two years based on certain conditions, and in any
event after four years. The stock is exchangeable at the Company's
option in whole on any dividend payment date on the basis of $50 of
6.50% Exchange Debentures for each share. The stock gains voting
rights when three semi-annual dividends are in arrears, and at that
time, the shareholder may appoint one representative to the
Company's Board of Directors.
NOTE L - ASSET PURCHASES
From October 1992 to July 1993, the Company purchased certain real
and personal property and assumed certain operating leases of
eighteen store locations from Hess's Department Stores, Inc. (Hess)
and Crown American Corporation. The acquired locations were in
Tennessee, Virginia, Kentucky, and Georgia. The total purchase
price for the acquired property was approximately $24 million which
was financed through the Company's revolving credit facility. The
Company did not acquire the merchandise inventories of the
locations. These stores were renovated and placed in service as
Proffitt's stores between November 1992 and November 1993.
Also, in October 1992, in a related but separate transaction, the
Company purchased from Citicorp Retail Services, Inc. a portion of
the trade accounts receivable generated by the proprietary credit
card program of Hess for the trade areas related to the property
purchased. The total purchase price for the trade accounts
receivable was $10.9 million which was financed through the
Company's revolving credit facility.
NOTE M - CHANGES IN ACCOUNTING METHODS
Effective January 31, 1993, the Company changed its method of
accounting for inventory to include certain purchasing and
distribution costs. Previously, these costs were charged to
expense in the period incurred rather than in the period in which
the merchandise was sold. The Company believes this new method is
preferable because it provides a better matching of the full cost
of obtaining merchandise and preparing it for sale with the related
revenues. The cumulative effect of this change for periods prior
to January 31, 1993 of $702 (net of income taxes of $449) is shown
separately in the consolidated statement of income. The effect of
this change on the fiscal year ended January 29, 1994 was to
increase net income before the cumulative effect by $461, or $.05
per common share.
Effective January 31, 1993, the Company also changed its method of
accounting for store pre-opening costs to expensing such costs when
incurred. Previously, these costs were amortized over the 12
months immediately following the individual store openings. The
Company believes this new method is preferable because it is more
conservative and is more prevalent in the industry. The cumulative
effect of this change for periods prior to January 31, 1993 of $369
(net of income taxes of $236) is shown separately in the
consolidated statement of income. The effect of this change on the
fiscal year ended January 29, 1994 was to decrease net income
before cumulative effect by $1,665, or $.18 per common share.
In 1992, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standard No. 109, Accounting for Income
Taxes, which requires a change from the deferred method to the
asset and liability method of accounting for income taxes. The
Company adopted the new accounting standard effective January 31,
1993. Adoption of the new standard had no effect on the Company's
financial position or results of operations. There would have been
no impact on 1992 had the standard been applied retroactively.
The pro forma net income and earnings per common share, if the
accounting changes for inventories and store pre-opening costs had
been retroactively applied, were as follows:
YEAR ENDED
JANUARY 30,
1993
Pro forma:
Net income $ 6,538
Earnings per common share $ .99
Historical:
Net income $ 6,747
Earnings per common share $ 1.02
Effective January 30, 1994, the Company changed its method of
accounting for inventory to the last-in, first-out (LIFO) method
for approximately 76% of its inventories. Previously, all
inventories were valued using the first-in, first-out (FIFO)
method. The Company believes this new method is preferable because
it more accurately matches costs with revenues and is more
prevalent in the industry. At January 28, 1995, inventories costed
under LIFO approximated FIFO. The cumulative effect of this change
is not presented because it is not determinable.
NOTE N - FAIR VALUES OF FINANCIAL INSTRUMENTS
The following methods and assumptions were used to estimate the
fair value of each class of financial instrument:
The fair values of cash and cash equivalents, accounts receivable,
and short-term debt approximates cost due to the immediate or
short-term maturity of these instruments.
For variable rate notes that reprice frequently, fair value
approximates carrying value. The fair values of fixed rate notes
are estimated using discounted cash flow analyses with interest
rates currently offered for loans with similar terms and credit
risk.
The fair values of convertible subordinated debentures are based on
quoted market prices. For junior subordinated debentures, the fair
values are estimated using discounted cash flow analyses with
interest rates currently offered for financial instruments with
similar terms and credit risk.
The fair value of the Preferred Stock, which was issued in a
private placement, is estimated at carrying value as such stock is
not traded in the open market and a market price is not readily
available.
The fair values of the Company's aforementioned financial
instruments at January 28, 1995 were as follows:
CARRYING ESTIMATED
AMOUNT FAIR VALUE
Cash and cash equivalents $ 1,133 $ 1,133
Accounts receivable 2,701 2,701
Fixed rate notes payable 10,154 10,723
Variable rate notes payable 45,000 45,000
Fixed rate real estate and mortgage notes 41,781 41,369
Variable rate real estate and mortgage
notes 32,010 32,010
Convertible subordinated debentures 86,250 65,119
Junior subordinated debentures 14,019 14,019
Convertible exchangeable Preferred Stock 28,850 28,850
NOTE O - SUBSEQUENT EVENT
On March 7, 1995, the Company acquired a majority interest (50.1%)
of Parks-Belk Company, the owner and operator of four department
stores in northeast Tennessee. Specific terms of the transaction
were not disclosed, but consideration was paid in Proffitt's, Inc.
Common Stock and cash and was less than $10 million. The Company
is negotiating to purchase the remaining interest.
<PAGE>
REPORTS
REPORT OF INDEPENDENT ACCOUNTANTS
Board of Directors
Proffitt's, Inc.
We have audited the accompanying consolidated balance sheets of
Proffitt's, Inc. and subsidiaries as of January 28, 1995 and
January 29, 1994, and the related consolidated statements of
income, shareholders' equity and cash flows for each of the three
years in the period ended January 28, 1995. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the consolidated financial
position of Proffitt's, Inc. and subsidiaries at January 28, 1995
and January 29, 1994 and the consolidated results of their
operations and their cash flows for each of the three years in the
period ended January 28, 1995, in conformity with generally
accepted accounting principles.
As described in Note M to the financial statements, the Company
changed its method of costing inventory, accounting for store
pre-opening expenses and accounting for income taxes in the year
ended January 29, 1994 and changed its method of valuing inventory
in the year ended January 28, 1995.
Knoxville, Tennessee
March 17, 1995
REPORT OF MANAGEMENT
The accompanying consolidated financial statements, including the
notes thereto, and the other financial information presented in the
Annual Report have been prepared by management. The financial
statements have been prepared in accordance with generally accepted
accounting principles and include amounts that are based upon our
best estimates and judgements. Management is responsible for the
consolidated financial statements, as well as the other financial
information in this Annual Report.
The Company maintains an effective system of internal accounting
control. We believe that this system provides reasonable assurance
that transactions are executed in accordance with management
authorization and that they are appropriately recorded in order to
permit preparation of financial statements in conformity with
generally accepted accounting principles and to adequately
safeguard, verify, and maintain accountability of assets.
Reasonable assurance is based on the recognition that the cost of
a system of internal control should not exceed the benefits
derived.
The consolidated financial statements and related notes have been
audited by independent certified public accountants. Management
has made available to them all of the Company's financial records
and related data and believes all representations made to them
during their audits were valid and appropriate. Their reports
provide an independent opinion upon the fairness of the financial
statements.
The Audit Committee of the Board of Directors is composed of three
outside Directors. The Committee is responsible for recommending
the independent certified public accounting firm to be retained for
the coming year, subject to shareholder approval. The Audit
Committee meets periodically with the independent auditors, as well
as with management, to review accounting, auditing, internal
accounting control, and financial reporting matters. The
independent auditors have unrestricted access to the Audit
Committee.
/s/ R. Brad Martin /s/ James E. Glasscock
R. Brad Martin James E. Glasscock
Chairman of the Board and Executive Vice President, Chief
Chief Executive Officer Financial Officer, and Treasurer
EXHIBIT 22.1
SUBSIDIARIES OF THE REGISTRANT
PROFFITT'S, INC. AND SUBSIDIARIES
Name of Subsidiary State of Incorporation
Proffitt's Investments, Inc. Tennessee
PDS Agency, Inc. Tennessee
Macco Investments, Inc. Mississippi
McRae's, Inc. Mississippi
McRae's of Alabama, Inc. Alabama
EXHIBIT 24.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration
statement of Proffitt's, Inc. on Form S-8 (File No. 33-46306), on
Form S-8 (File No. 33-74070), on Form S-8 (File No. 33-80602) and
on Form S-8 (File No. 33-88390) of our report dated March 17, 1995,
on our audits of the consolidated financial statements and
financial statement schedule of Proffitt's, Inc. as of January 28,
1995 and January 29, 1994, and for each of the three years in the
period ended January 28, 1995, which report is included in this
Form 10-K.
COOPERS & LYBRAND L.L.P.
Knoxville, Tennessee
April 25, 1995
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S CONSOLIDATED BALANCE SHEETS AS OF JANUARY 28, 1995 AND THE COMPANY'S
CONSOLIDATED STATEMENT OF INCOME FOR THE THE FISCAL YEAR ENDED JANUARY 28, 1995
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JAN-28-1995
<PERIOD-END> JAN-28-1995
<CASH> 1,133,000
<SECURITIES> 0
<RECEIVABLES> 2,701,000
<ALLOWANCES> 2,411,000
<INVENTORY> 162,080,000
<CURRENT-ASSETS> 179,560,000
<PP&E> 300,285,000
<DEPRECIATION> 40,831,000
<TOTAL-ASSETS> 540,055,000
<CURRENT-LIABILITIES> 76,421,000
<BONDS> 282,958,000
<COMMON> 997,000
0
28,850,000
<OTHER-SE> 150,829
<TOTAL-LIABILITY-AND-EQUITY> 540,055,000
<SALES> 617,363,000
<TOTAL-REVENUES> 632,125,000
<CGS> 400,605,000
<TOTAL-COSTS> 546,165
<OTHER-EXPENSES> 43,711
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 15,655,000
<INCOME-PRETAX> 26,594,000
<INCOME-TAX> 10,466,000
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 14,434,000
<EPS-PRIMARY> 1.46
<EPS-DILUTED> 1.46
</TABLE>
