FORM 10Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(X) Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended July 29, 1995
OR
( ) Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the transition period from to
For Quarter Ended: July 29, 1995
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
Indicate by check mark whether Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports) and (2) has been subject to such filing
requirements for the past 90 days.
Yes (X) No ( )
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Common Stock, $.10 Par Value -- 10,229,655 shares as of July 29,
1995
<PAGE>
PROFFITT'S, INC.
Index
PART I. FINANCIAL INFORMATION Page No.
Item 1. FINANCIAL STATEMENTS (UNAUDITED)
Condensed Consolidated Balance Sheets --
July 29, 1995, January 28, 1995, and
July 30, 1994 2
Condensed Consolidated Statements of Income --
Three Months Ended July 29, 1995 and July 30, 1994 3
Condensed Consolidated Statements of Cash Flows --
Six Months Ended July 29, 1995 and July 30, 1994 4
Notes to Condensed Consolidated Financial
Statements 5
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 7
PART II. OTHER INFORMATION
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 11
Item 6. EXHIBITS AND REPORTS ON FORM 8-K 11
SIGNATURES 12
PROFFITT'S, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
JULY 29, JANUARY 28, JULY 30,
1995 1995 1994
(UNAUDITED) (AUDITED) (UNAUDITED)
ASSETS
Current assets
Cash and cash equivalents $ 1,108 $ 1,133 $ 1,086
Net trade accounts receivable, less
receivables sold to third party 14,536 2,701 6,610
Merchandise inventories 172,755 162,080 170,629
Other current assets 17,064 13,646 19,209
--------- --------- ---------
Total current assets 205,463 179,560 197,534
Property and equipment, net 311,820 300,285 292,745
Goodwill 50,443 44,624 45,420
Other assets 16,300 15,586 15,052
--------- --------- ---------
$ 584,026 $ 540,055 $ 550,751
========= ========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable $ 43,853 $ 34,587 $ 51,511
Other accrued liabilities 26,252 26,565 25,040
Current portion of long-term debt
and capital lease obligations 15,268 15,269 17,585
--------- --------- ---------
Total current liabilities 85,373 76,421 94,136
Real estate and mortgage notes 63,039 64,726 69,558
Notes payable 75,493 49,376 54,759
Capital lease obligations 11,083 11,319 11,532
Deferred income taxes 57,117 54,830 52,085
Other long-term liabilities 3,154 2,438 1,497
Subordinated debentures 100,384 100,269 100,160
Shareholders' equity 188,383 180,676 167,024
--------- --------- ---------
$ 584,026 $ 540,055 $ 550,751
========= ========= =========
See notes to condensed consolidated financial statements.
PROFFITT'S, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(in thousands, except per share amounts)
THREE MONTHS ENDED SIX MONTHS ENDED
JULY 29, JULY 30, JULY 29, JULY 30,
1995 1994 1995 1994
Net sales $ 148,689 $ 142,365 $ 309,110 $ 228,484
Costs and expenses:
Cost of sales 94,488 93,753 196,750 151,946
Selling, general, and
administrative expenses 39,534 35,978 80,232 56,081
Other operating expenses 11,581 11,020 23,531 18,403
--------- -------- ---------- --------
Operating income 3,086 1,614 8,597 2,054
Other income (expense):
Finance charge income, net of
allocation to purchaser of
accounts receivable 3,678 3,885 7,294 6,487
Interest expense (4,789) (4,264) (9,570) (6,919)
Other income (expense), net (12) 247 342 565
---------- --------- --------- --------
Income before provision for
income taxes 1,983 1,482 6,663 2,187
Provision for income taxes 879 671 2,777 976
---------- --------- --------- --------
NET INCOME 1,804 811 3,886 1,211
Preferred stock dividends 487 537 975 718
---------- --------- --------- --------
Net income available to
common shareholders $ 597 $ 274 $ 2,911 $ 493
========= ========= ========= ========
Earnings per common share $ 0.06 $ 0.03 $ 0.28 $ 0.05
========= ========= ========= ========
Weighted average common shares 10,434 9,924 10,297 9,759
========= ========= ========= ========
Note/Earnings per common share amounts are based on the weighted
average number of shares of common stock and dilutive common stock
equivalents (employee stock options) outstanding during each period,
after recognition of preferred stock dividends.
See notes to condensed consolidated financial statements.
PROFFITT'S, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(in thousands)
SIX MONTHS ENDED
JULY 29, JULY 30,
1995 1994
OPERATING ACTIVITIES
Net income $ 3,886 $ 1,211
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and amortization 9,635 7,987
Changes in operating assets and liabilities, net (7,451) 70,723
--------- --------
Net cash provided by operating
activities 6,070 79,921
INVESTING ACTIVITIES
Purchases of property and equipment, net (13,526) (6,855)
Acquisition of Parks-Belk Company (10,422)
Acquisition of Macco Investments, Inc. (199,140)
--------- --------
Net cash used in investing activities (23,948) (205,995)
FINANCING ACTIVITIES
Payments on long-term debt and capital lease
obligations (5,672) (29,731)
Proceeds from long-term borrowings 24,500 112,640
Proceeds from issuance of stock 29,121
Dividends paid to preferred shareholders (975) (70)
--------- --------
Net cash provided by financing activities 17,853 111,960
Decrease in cash and cash equivalents (25) (14,114)
Cash and cash equivalents at beginning
of period 1,133 15,200
--------- --------
Cash and cash equivalents at end of period $ 1,108 $ 1,086
========= ========
Cash paid during the six months ended July 29, 1995 for interest and
income taxes totaled $9,089 and $3,767, respectively.
Cash paid during the six months ended July 30, 1994 for interest and
income taxes totaled $5,646 and $8,721, respectively.
In July 1994, the Company redeemed and converted 32,962 shares of
Series B Preferred Stock into 156,213 shares of Company Common Stock.
See notes to condensed consolidated financial statements.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE A -- BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial
statements have been prepared in accordance with generally
accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Article 10 of the
Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted
accounting principles for complete financial statements. In the
opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation
have been included. Operating results for the three and six
month periods ended July 29, 1995 are not necessarily indicative
of the results that may be expected for the year ending February
3, 1996. For further information, refer to the consolidated
financial statements and footnotes thereto included in the
Company's Annual Report on Form 10-K for the year ended January
28, 1995.
The balance sheet at January 28, 1995 has been derived from the
audited financial statements at that date.
NOTE B -- ACQUISITIONS
On March 31, 1994, Proffitt's, Inc. acquired all of the common
stock of Macco Investments, Inc., a privately held corporation
and the parent company of McRae's, Inc. The total acquisition
price of approximately $212 million consisted of a cash payment
of $176 million and the issuance of (i) 436,200 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) 32,962 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, Proffitt's,
Inc. 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. Proffitt's, Inc.
now operates two divisions: the Proffitt's Stores Division and
the McRae's Stores Division.
The excess of the cost of acquiring McRae's over the fair value
of the acquired tangible assets is presented in the financial
statements as Goodwill. Amortization of goodwill is provided on
a straight-line basis over forty years.
The following unaudited pro forma summary presents the
consolidated results of operations as if the acquisition had
occurred at the beginning of the period presented and do not
purport to be indicative of what would have occurred had the
acquisition been made as of this date or of results which may
occur in the future.
Six Months Ended
July 30,
1994
(in thousands, except per share amounts)
Net sales $291,526
Net income $ 2,992
Earnings per common share $ .19
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. On April 12, 1995, the
Company completed the purchase of the remaining interest of
Parks-Belk. Specific terms of the transaction were not
disclosed, but consideration was paid in Proffitt's, Inc. Common
Stock and cash (aggregated less than $20 million). Goodwill has
been recorded on the Parks-Belk acquisition and is being
amortized on a straight-line basis over thirty years. On June 18,
1995, the Parks-Belk locations in Johnson City, Kingsport, and
Greeneville, Tennessee were converted into Proffitt's stores, and
the Parks-Belk store in Morristown, Tennessee was permanently
closed. These locations operated as Parks-Belk stores within the
Proffitt's Division until June 18, 1995.
NOTE C -- INCOME TAXES
The difference between the actual income tax expense and the
amount expected by applying the statutory federal income tax rate
is due to the inclusion of state income taxes and to the
amortization of goodwill, which is not deductible for income tax
purposes.
The deferred income tax liability reflects the impact of
temporary differences between values recorded for assets and
liabilities for financial reporting purposes and values utilized
for measurement in accordance with tax laws. The major component
of the liability results from the allocation of the purchase
price to the assets and liabilities related to the McRae's
acquisition.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
Accounts receivable, inventory, accounts payable, and notes
payable balances fluctuate throughout the year due to the
seasonal nature of the retail industry. A portion of the
increases over year-end and prior year balances in these accounts
is attributable to the acquisition of Parks-Belk.
July 29, 1995 property and equipment balances increased over
January 28, 1995 and July 30, 1994 balances primarily due to the
acquisition and renovation of Parks-Belk stores, construction of
a relocated McRae's store, other store renovations, and
information system enhancements.
July 29, 1995 total indebtedness increased compared to year-end
balances primarily due to indebtedness incurred and assumed
related to the Parks-Belk acquisition.
July 29, 1995 shareholders' equity has increased over January 28,
1995 and July 30, 1994 primarily due to the issuance of common
stock in conjunction with the Parks-Belk transaction and net
earnings.
RESULTS OF OPERATIONS
The results of operations for the six months ended July 30, 1994
include operations from the Proffitt's Division for the entire
period and results from the McRae's Division subsequent to March
31, 1994. The results of operations for the six months ended
July 29, 1995 include the combined operations from both divisions
for the entire period. The operations of the Parks-Belk stores
subsequent to its acquisition have been included in the Company's
results for the six months ended July 29, 1995. The Company
currently operates its McRae's Division with 28 department stores
and one home furnishings specialty store and its Proffitt's
Division with 26 department stores.
The following table shows, for the periods indicated, certain
items from the Company's Condensed Consolidated Statements of
Income expressed as percentages of net sales.
THREE MONTHS ENDED SIX MONTHS ENDED
7/29/95 7/30/94 7/29/95 7/30/94
Net sales 100.0% 100.0% 100.0% 100.0%
Costs and expenses:
Cost of sales 63.5 65.9 63.7 66.5
Selling, gen., & admin.
exp. 26.6 25.3 26.0 24.5
Other operating expenses 7.8 7.7 7.7 8.1
Operating income 2.1 1.1 2.6 0.9
Other income (expense):
Finance charge income,
net of allocation
to purchaser of
accounts receivable 2.4 2.7 2.4 2.8
Interest expense (3.2) (3.0) (3.0) (3.0)
Other income (expense),
net 0.0 0.2 0.2 0.2
Income before provision
for income taxes 1.3 1.0 2.2 0.9
Provision for income taxes 0.6 0.4 0.9 0.4
NET INCOME 0.7% 0.6% 1.3% 0.5%
===== ===== ==== ====
Total net sales for the three months ended July 29, 1995
increased 4% to $148.7 million from $142.4 million in the prior
year. Comparable store sales increased 2% for the quarter.
Revenues for the McRae's Division were $90.6 million, a decrease
of 2% over last year. The Proffitt's Division sales, including
revenues of $3.7 million generated from the Parks-Belk stores,
were $58.1 million for the quarter, up 16% from last year. For
the quarter, comparable store sales decreased 1% for the McRae's
Division and increased 7% for the Proffitt's Division. Sales for
the quarter were negatively affected by extraordinarily hot
weather that slowed store traffic in the Company's markets,
particularly in the month of July. In addition, the Company
owned less clearance merchandise than one year ago which affected
sales.
Total net sales for the six months ended July 29, 1995 increased
35% to $309.1 million from $228.5 million recorded last year.
First half comparable store sales increased 3% over the prior
year. Revenues for the McRae's Division totaled $194.4 million,
up 1% over last year on both a total and comparable stores basis.
Sales for the Proffitt's Division were $114.8 million (including
$7.6 million from the Parks-Belk stores), a 15% increase over the
prior year. On a comparable stores basis, sales for the
Proffitt's Division increased 7% for the first half.
Cost of sales as a percent of net sales decreased 2.4% and 2.8%
for the three and six months ended July 29, 1995, respectively,
as compared to the same prior year period primarily due to
improved inventory control and lower merchandise markdowns. Cost
of sales as a percent of net sales for the three and six months
ended July 30, 1994 was higher than normal due to excessive
inventory markdowns needed to clear aged merchandise at the
Proffitt's Division. These markdowns resulted from overstocking
new store locations in 1993 and weakness in women's apparel sales
in fall 1993.
Selling, general, and administrative expenses as a percent of net
sales increased 1.3% and 1.5% for the three and six months ended
July 29, 1995, respectively, from last year. Total selling,
general, and administrative expenses increased 43% for the six
months ended July 29, 1995 over last year, to $80.2 million,
primarily due to additional overhead and other expenses required
to operate the expanded store base. The Company consolidated
certain administrative support areas for the Proffitt's and
McRae's Divisions (accounting, credit, and management information
systems) during the second quarter of 1995. The Company
anticipates future leverage of selling, general, and
administrative expenses due to these consolidations, increased
sales volume, and expense control efforts.
Other operating expenses as a percentage of net sales decreased
0.4% for the six month period over last year primarily due to
leverage generated from a larger sales base.
Net finance charge income, as a percent of net sales, was down
0.3% and 0.4% for the three and six months ended July 29, 1995,
respectively, from last year primarily due to the allocation to
the third party purchaser of accounts receivable of finance
charges. For the quarter, the allocation was $2.1 million, or
1.4% of net sales, compared to $1.5 million, or 1.0% of net
sales, last year. For the first half, the allocation was $4.3
million, or 1.4% of net sales, compared to $1.9 million, or 0.8%
of net sales, last year. Gross finance charge income (before
allocation to third party), as a percent of net sales, remained
fairly level for the three and six month period over last year.
Interest expense as a percent of net sales was relatively flat
for the three and six months ended July 29, 1995 as compared to
the same prior year period. Total interest expense increased 38%
for the six months ended July 29, 1995 over last year, to $9.6
million, primarily due to higher borrowings associated with the
McRae's and Parks-Belk acquisitions and higher interest rates.
Net income for the three months ended July 29, 1995 totaled $1.1
million, or $.06 per share, as compared to net earnings for the
three months ended July 30, 1994 of $.8 million, or $.03 per
share. Net income for the six months ended July 29, 1995 was
$3.9 million, or $.28 per share, as compared to net earnings for
the six months ended July 30, 1994 of $1.2 million, or $.05 per
share. The increase in earnings primarily was due to enhanced
gross margin performance.
PROFFITT'S, INC.
PART II. Other Information
Item 4. Submission of Matters to a Vote of Security Holders.
The Annual Meeting of the Shareholders of the Company was
held on June 15, 1995. 82.2%, or 8,403,671 shares of the
10,218,624 shares of common stock entitled to vote, were
represented in person or by proxy. The matters submitted to a
vote of the shareholders and the vote on these matters were as
follows:
1) All nominees for Directors listed in the proxy statement were
elected to hold office until the next Annual Meeting of the
Shareholders. Shareholders holding at least 8,354,104 shares
voted for, shareholders holding no more than 42,960 shares voted
against, and shareholders holding no more than 6,607 shares
abstained from the vote.
2) Adoption of Proffitt's, Inc. 1994 Employee Stock Purchase
Plan.
For - 8,308,034 Against - 7,925 Abstain - 14,800
3) Special Meeting Proposal amending the Company's Charter to
require the demand of at least 25% of all votes entitled to be
cast on an issue in order to call a special meeting of the
shareholders.
For - 4,542,466 Against - 2,722,126 Abstain - 15,840
4) Ratification of Appointment of Independent Accountants
(Coopers & Lybrand L.L.P.) for the fiscal year ending February 3,
1996.
For - 8,397,514 Against - 3,095 Abstain - 3,062
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
3.1 Articles of Amendment to the Charter of
Proffitt's, Inc., designating the maximum number
of shares of all classes of stock which the
corporation shall have the authority to issue
3.2 Articles of Amendment to the Charter of
Proffitt's, Inc., designating special meeting of
shareholders
3.3 Amended and Restated Bylaws of Proffitt's, Inc.
11.1 Statement re: Computation of Earnings per Common
Share
27 Financial Data Schedule
(b) Form 8-K Reports -- None.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
PROFFITT'S, INC.
-----------------------------------
Registrant
September 8, 1995
-----------------------------------
Date
/s/ James E. Glasscock
-----------------------------------
James E. Glasscock
Executive Vice President, Chief
Financial Officer, and Treasurer
ARTICLES OF AMENDMENT
TO THE CHARTER
OF
PROFFITT'S, INC.
Pursuant to the provisions of Section 48-20-106 of the
Tennessee Business Corporation Act, the undersigned corporation
adopts the following articles of amendment to its Certificate of
Incorporation:
1. The name of the corporation is PROFFITT'S, INC.
2. The text of each amendment is as follows:
A. The first paragraph of ARTICLE VI of the Charter
is hereby deleted in its entirety and the following
paragraph shall be inserted in lieu thereof:
ARTICLE VI. Shares. The maximum number of shares of
all classes of stock which the corporation shall have the
authority to issue is 110,000,000 shares consisting of
10,000,000 shares of Series Preferred Stock, with a par
value of $1.00 per share (herein called the "Series
Preferred Stock") and 100,000,000 shares of Common Stock,
with a par value of $.10 per share (herein called the
"Common Stock").
3. The corporation is a for-profit corporation.
4. The amendment was duly adopted on June 29, 1993 by the
Board of Directors and the Shareholders of the Corporation.
6. These articles of amendment are to be effective when
these articles are filed by the Secretary of State.
Dated: October 7, 1993
PROFFITT'S, INC.
By:/s/ Julia A. Bentley
____________________
Julia A. Bentley, Secretary
ARTICLES OF AMENDMENT
TO THE CHARTER OF PROFFITT'S, INC.
Pursuant to Section 10.06 of the Tennessee Business
Corporation Act, the undersigned corporation adopts the following
Articles of Amendment to its Certificate of Incorporation:
1. The name of the corporation is PROFFITT'S, INC.
2. The text of the amendment is as follows:
A new Article XIV is added to the Charter to read:
ARTICLE XIV. Special Meeting of Shareholders. No
special meeting of shareholders shall be held upon the
demand of shareholders of the Corporation unless the
holders of at least twenty-five percent (25%) of all the
votes entitled to be cast on each issue proposed to be
considered at the special meeting shall have signed,
dated, and delivered to the Corporation's Secretary one
or more written demands for the meeting describing the
purpose or purposes for which it is to be held.
3. The corporation is a for-profit corporation.
4. The amendment was duly adopted on June 15, 1995, by the
Board of Directors and the shareholders of the Corporation.
Date: June 15, 1995
PROFFITT'S, INC.
By:/s Julia A. Bentley
___________________________
Julia A. Bentley, Secretary
AMENDED AND RESTATED BYLAWS
OF
PROFFITT'S, INC.
ARTICLE I
OFFICES AND REGISTERED AGENT
Section 1. Principal Office. The principal office of this
Corporation is at Midland Shopping Center, Calderwood Road, Alcoa,
Blount County, Tennessee, as provided in the Charter. The Board of
Directors may, by Resolution, amend the Charter to change the
address of the principal office in the State of Tennessee.
Section 2. Registered Agent. The Corporation has designated
and shall continue to have a registered agent in the State of
Tennessee. If the registered agent resigns or is for any reason
unable to perform his duties, the Corporation shall promptly
designate another registered agent. The Corporation may, by
Resolution of the Board of Directors, appoint such other agents for
the service of process in such other jurisdictions as the Board of
Directors may determine.
ARTICLE II
MEETINGS OF SHAREHOLDERS
Section 1. Meetings. All meetings of the shareholders for
the election of directors shall be held in the City of Alcoa, State
of Tennessee, at such place as may be fixed from time to time by
the Board of Directors, or at such other place either within or
without the State of Tennessee as shall be designated from time to
time by the Board of Directors and stated in the notice of the
meeting. Meetings of shareholders for any other purpose may be
held at such time and place, within or without the State of
Tennessee, as shall be stated in the notice of the meeting or in a
duly executed waiver of notice thereof.
Section 2. Annual Meetings. Annual meetings of the
shareholders, commencing with fiscal year 1988, shall be held on
the 2nd Monday of June if said date is not a legal holiday, and if
a legal holiday, then on the next secular day following, or at such
other date and time as shall be designated from time to time by the
Board of Directors, for the purpose of electing directors of the
Corporation and for the transacting of such other business as may
properly come before the meeting. Written notice of the annual
meeting stating the place, date and hour of the meeting shall be
given to each shareholder entitled to vote at such meeting not less
than 10 days nor more than 60 days before the date of the meeting.
Section 3. Shareholder List. The officer who has charge of
the stock ledger of the corporation shall prepare and make, at
least ten days before every meeting of shareholders, a complete
list of the shareholders entitled to vote at the meeting, arranged
in alphabetical order, and showing the address of each shareholder
and the number of shares registered in the name of each
shareholder. Such list shall be open to the examination of any
shareholder, for the purpose germane to the meeting, during
ordinary business hours, for a period of at least ten days prior to
the meeting, either at a place within the city where the meeting is
to be held which place shall be specified in the notice of the
meeting, or, if not so specified at the place where the meeting is
to be held. The list shall also be produced and kept at the time
and place of the meeting during the whole time thereof, and may be
inspected by any shareholder who is present.
Section 4. Special Meetings. Special meetings of the
shareholders may be called by the Board of Directors or by the
Chairman of the Board, or by the President, and shall be called by
the Chairman, the President, the Secretary, or an assistant
Secretary at the request in writing of a majority of the Board of
Directors, or at the request in writing of the holders of record of
at least twenty-five percent (25%) of the outstanding shares of the
Corporation entitled to vote at the meeting. Each special meeting
shall be held at such time as the Board of Directors shall
determine, or in the absence of such determination by the Board of
Directors, at such time as the person or persons calling or
requesting the call of the meeting shall specify in the notice or
in the written request. Written notice of a special meeting
stating the place, date and hour of the meeting and the purpose or
purposes for which the meeting is called, shall be given to each
shareholder entitled to vote at such meeting not less than 10 days
or more than 60 days before the date of the meeting. The business
transacted at any special meeting shall be limited to the purposes
stated in the notice.
Section 5. Waiver of Notice. Shareholders may waive the
requirement of written notice of annual and special meetings by
written waiver duly executed and filed with the minutes of the
meeting.
Section 6. Quorum. The holders of record of a majority of
the stock issued and outstanding and entitled to vote thereat,
present in person or represented by proxy, shall constitute a
quorum at all meetings of the shareholders for the transaction of
business except as otherwise provided by statute or by the Charter.
A quorum once present, is not broken by the subsequent withdrawal
of any shareholder. If, however, such quorum shall not be present
or represented at any meeting of the shareholders, the shareholders
entitled to vote thereat, present in person or represented by
proxy, shall have power to adjourn the meeting from time to time,
without notice other than announcement at the meeting, until a
quorum shall be present or represented. At such adjourned meeting
at which a quorum shall be present or represented by proxy, any
business may be transacted which might have been transacted at the
meeting as originally notified. If the adjournment is for more
than thirty days, or if after the adjournment a new record date is
fixed for the adjourned meeting, a notice of the adjourned meeting
shall be given to each shareholder of record entitled to vote at
the meeting. When a quorum is present at any meeting, the vote of
the holders of a majority of the stock having voting power present
in person or represented by proxy shall decide any question brought
before such meeting, unless the question is one upon which by
express provision of the statutes or of the Charter a different
vote is required, in which case such express provision shall govern
and control the decision of such question.
Section 7. Meeting Chairman. The Chairman of the Board, or
if absent or unable to serve, the President, or if absent or unable
to serve, the Treasurer or Secretary, shall call meetings of the
shareholders to order and act as Chairman of such meetings. The
shareholders may elect any one of their number to act as Chairman
of any meeting in the absence of the aforenamed individuals.
Section 8. Proxies. Every shareholder entitled to vote at a
shareholders' meeting may authorize another person or persons to
act for him by proxy. Each proxy must be in writing and signed by
the shareholder or by his attorney in fact. No proxy shall be
valid after the expiration of eleven (11) months from the date
thereof unless otherwise provided in the proxy. Each proxy shall
be revocable at the pleasure of the shareholder executing it,
unless it conforms to the requirements of an irrevocable proxy, as
provided by statute. All proxies must be delivered to the
Secretary of the Corporation prior to the opening of the meeting,
except for proxies granted after the meeting has opened, which
proxies shall be delivered to the Secretary as soon as practicable
after execution.
Section 9. Determination of Shareholder. In order to
determine shareholders entitled to notice of or to vote at any
meeting of shareholders, or any adjournment thereof, or
shareholders entitled to receive payment of any dividend, or in
order to make a determination of shareholders for any other proper
purpose, the Board of Directors may provide that the Stock Transfer
Books be closed for a stated period, but not to exceed forty (40)
days. If the Stock Transfer Books are closed for the purpose of
determining shareholders entitled to notice of or to vote at a
meeting of shareholders, such books shall be closed for at least
ten (10) days immediately preceding such meeting. In lieu of
closing the Stock Transfer Books, the Board of Directors may fix in
advance a date as the record date for any such determination of
shareholders, such date in any case to be not less than ten (10)
days prior to the date on which the particular action requiring
such determination of shareholders is to be taken. If the Stock
Transfer Books are not closed and no record date is fixed for
determination of shareholders entitled to notice of or entitled to
vote at a meeting of shareholders or shareholders entitled to
receive payment of a dividend, the date on which notice of the
meeting is mailed, or the date on which the Resolution of the Board
declaring such dividend is adopted, as the case may be, shall be
the record date for such determination of shareholders.
Section 10. Shareholder Action By Written Consent. Any
action required or permitted to be taken by the shareholders of the
Corporation must be effected at a duly called annual or special
meeting of such holders and may not be effected by any consent in
writing by such holders.
ARTICLE III
BOARD OF DIRECTORS
Section 1. Number of Directors. The affairs of this
Corporation shall be managed by a Board of up to fifteen (15)
directors. The directors shall be elected at the annual meeting of
the shareholders, except as provided in Section 3 of this
Article, and each director elected shall hold office for a term of
one (1) year or until his successor is elected and qualified.
Directors need not be shareholders nor residents of the State of
Tennessee. The number of directors may be changed by the board by
amending these Bylaws; provided, that the adoption of such an
amendment by the Board of Directors shall require the vote of a
majority of the entire board. No decrease in the number of
directors shall shorten the term of any incumbent director.
Section 2. Removal of Directors. Any or all directors may be
removed by a vote of a majority of the shareholders entitled to
vote, only for cause as defined by the Tennessee General
Corporation Act.
Section 3. Filling of Vacancies. Vacancies and newly created
directorships resulting from any increase in the authorized number
of directors, for any reason, may be filled by a vote of the
majority of the directors then in office, although less than a
quorum exists, or by a sole remaining director, and the directors
so chosen shall hold office until the next annual election and
until their successors are duly elected and qualified, unless
sooner displaced. If there are no directors in office, then an
election of directors may be held in the manner provided by
statute. If, at the time of filling any vacancy or any newly
created directorship, the directors then in office shall constitute
less than a majority of the whole board (as constituted immediately
prior to any such increase), the vacancy or newly created
directorship may be filled by vote of the shareholders at any
meeting of the shareholders, notice of which shall have referred to
the proposed election. Any director elected to fill any vacancy
shall be elected to hold office for the unexpired term of his
predecessor, or, if there is no predecessor, until the next annual
meeting of shareholders.
Section 4. First Meeting. The first meeting of each newly
elected Board of Directors shall be held immediately after and at
the same place as the annual meeting of the shareholders, provided
a quorum be present and no notice of such meeting shall be
necessary. In the event such meeting of the newly elected Board of
Directors is not held at such time and place, the meeting may be
held at such time and place as shall be specified in a notice given
as hereinafter provided for special meetings of the Board of
Directors, or as shall be specified in a written waiver signed by
all of the directors.
Section 5. Notice of Meetings. The annual and all regular
meetings of the Board of Directors may be held without notice at
such time and at such place as shall from time to time be
determined by the board. Special meetings shall be held upon
written notice not less than one day before the meeting.
Section 6. Special Meetings. Special meetings of the board
may be called by the Chairman of the Board or President, or if
either is absent or unable to do so, by any Vice President, or by
any two directors.
Section 7. Quorum. At all meetings of the board, a majority
of directors shall constitute a quorum for the transaction of
business and the act of a majority of the directors present at any
meeting at which there is a quorum shall be the act of the Board of
Directors, except as may be otherwise specifically provided by law,
the Charter or by the Bylaws. If a quorum shall not be present at
any meeting of the Board of Directors, the directors present
thereat may adjourn the meeting from time to time, without notice
other than announcement at the meeting, until a quorum shall be
present.
Section 8. Dissent to Action. A director who is present at
a meeting of the Board, at which any action is taken, shall be
presumed to have concurred in the action, unless his dissent
thereto shall be entered in the Minutes of the meeting, or unless
he shall submit his written dissent to the person acting as the
Secretary of the meeting before the adjournment thereof, or shall
deliver or send such dissent to the Secretary of the Corporation
promptly after the adjournment of the meeting. Such rights to
dissent shall not apply to a director who voted in favor of any
such action. A director who is absent from a meeting at which such
action is taken shall be presumed to have concurred in the action
unless he shall deliver or send by registered or certified mail his
dissent thereto to the Secretary of the Corporation or shall cause
such dissent to be filed with the Minutes of the proceedings of the
Board within ten (10) days after learning of such action.
Section 9. Action without Meeting. Unless otherwise
restricted by the Charter or these bylaws, any action required or
permitted to be taken at any meeting of the Board of Directors or
of any committee thereof may be taken without a meeting, if all
members of the board or committee, as the case may be, consent
thereto in writing setting forth the actions so taken, signed by
all of the persons entitled to vote thereon, and the writing or
writings are filed with the minutes of proceedings of the board or
committee.
Section 10. Board Committees. The Board of Directors may, by
resolution passed by a majority of the whole board, designate one
or more committees, each committee to consist of one or more of the
directors of the Corporation. The board may designate one or more
directors as alternate members of any committee, who may replace
any absent or disqualified member at any meeting of the committee.
Any such committee, to the extent provided in the resolution of the
Board of Directors, shall have and may exercise all the powers and
authority of the board of directors in the management of the
business and affairs of the Corporation, but no such committee
shall have the power or authority in reference to amending the
Charter, adopting an agreement of merger or consolidation,
recommending to the shareholders the sale, lease or exchange of all
or substantially all of the Corporation's property and assets,
recommending to the shareholders a dissolution of the Corporation
or a revocation of the dissolution, or amending the bylaws of the
Corporation; and, unless the resolution or the Charter expressly so
provide, no such committee shall have the power or authority to
declare a dividend or to authorize the issuance of stock. Such
committee or committees shall have such name or names as may be
determined from time to time by resolution adopted by the Board of
Directors. Each committee shall keep regular minutes of its
meetings and report the same to the Board of Directors when
required.
Section 11. Compensation of Directors. Unless otherwise
restricted by the Charter, the Board of Directors shall have the
authority to fix the compensation of directors. The directors may
be paid their expenses, if any, of attendance at each meeting of
the Board of Directors and may be paid a fixed sum for attendance
at each meeting of the Board of Directors and/or a stated salary as
director. No such payment shall preclude any director from serving
the Corporation in any other capacity and receiving compensation
therefor. Members of special or standing committees may be allowed
like compensation for attending committee meetings.
Section 12. Indemnification. The Corporation shall indemnify
to the full extent authorized or permitted by the Tennessee General
Corporation Act any person made, or threatened to be made, a party
to any threatened, pending or completed action, suit or proceeding
(whether civil, criminal, administrative or investigative) by
reason of the fact that he, his testator or intestate is or was a
director of the Corporation or serves or served as a director of
any other enterprise at the request of the Corporation.
Section 13. Mandatory Resignation. Directors who are also
officers of the corporation shall submit a letter of resignation as
such to the Board of Directors upon any termination of employment
as an officer of the Corporation and directors who are not officers
of the Corporation shall likewise submit a letter of resignation
upon any change in that director's principal business or other
activity in which the director was engaged at the time of his or
her election.
ARTICLE IV
OFFICERS
Section 1. Appointment. The Board of Directors at its first
meeting after each annual meeting of stockholders shall choose a
Chairman of the Board, a Chief Executive Officer, a President, an
Executive Vice President, a Chief Operating Officer, a Chief
Financial Officer, a Treasurer, and a Secretary. The Board of
Directors may also choose additional vice presidents, and one or
more assistant secretaries and assistant treasurers. Any two of
the aforementioned offices may be filled by the same person, except
that no one person may be Secretary and also President. No person
shall purport to execute or attest any document or instrument on
behalf of the Corporation in more than one capacity.
Section 2. Term. The officers of the Corporation shall hold
office for one year or until their successors are chosen and
qualified subject, however, to the removal of any officer pursuant
to these Bylaws.
Section 3. Salaries. The salaries of all officers of the
corporation shall be fixed by the Board of Directors.
Section 4. Removal. Any officer elected or appointed by the
Board of Directors may be removed at any time by the affirmative
vote of a majority of the Board of Directors. Any vacancy
occurring in any office of the corporation shall be filled by the
Board of Directors.
Section 5. Duties. All officers shall have such authority to
perform such duties in the management of the Corporation as are
normally incident to their offices and as the directors from time
to time provide.
Section 6. The Chairman of the Board and Chief Executive
Officer. The Chairman of the Board and Chief Executive Officer of
the Corporation shall preside at all meetings of the shareholders
and the Board of Directors, shall have general and active
management of the business of the Corporation, and shall see that
all orders and resolutions of the Board of Directors are carried
into effect.
Section 7. Other Duties of the Chairman of the Board. He
shall execute bonds, mortgages and other contracts, except where
required or permitted by law to be otherwise signed and executed
and except where the signing and execution thereof shall be
expressly delegated by the Board of Directors to some other officer
or agent of the corporation.
Section 8. The President. The President shall perform such
duties as shall be prescribed to him from time to time by the Board
of Directors.
Section 9. Duties of the President and the Vice President(s).
In the absence of the Chief Executive Officer or in the event of
his inability or refusal to act, the President shall perform the
duties of the Chief Executive Officer and, when so acting, shall
have all the powers of and be subject to all the restrictions upon
the Chief Executive Officer. The Vice-President(s) shall perform
such other duties and have such other powers as the Board of
Directors may from time to time prescribe.
Section 10. The Secretary. The Secretary shall attend all
meetings of the Board of Directors and all meetings of the
shareholders and record all the proceedings of the meetings of the
Corporation and of the Board of Directors in a book to be kept for
that purpose and shall perform like duties for the standing
committees when required. He shall give, or cause to be given,
notice of all meetings of the shareholders and special meetings of
the Board of Directors, and shall perform such other duties as may
be prescribed by the Board of Directors or President, under who
supervision he shall be.
Section 11. Assistant Secretary. The Assistant Secretary,
or if there be more than one, the assistant secretaries in the
order determined by the Board of Directors (or if there be no such
determination, then in the order of their election), shall, in the
absence of the Secretary or in the event of his inability or
refusal to act, perform the duties and exercise the powers of the
Secretary and shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.
Section 12. The Chief Financial Officer and Treasurer. The
Chief Financial Officer and the Treasurer, in his capacity as such
officers shall have the custody of the corporate funds and
securities and shall keep full and accurate accounts of receipts
and disbursements in books belonging to the corporation and shall
deposit all moneys and other valuable effects in the name and to
the credit of the Corporation in such depositories as may be
designated by the Board of Directors.
Section 13. Duties of the Chief Financial Officer and
Treasurer. He shall disburse the funds of the Corporation as may
be ordered by the Board of Directors, taking proper vouchers for
such disbursements, and shall render to the President and the Board
of Directors, at its regular meetings, or when the Board of
Directors so requires, an account of all his transactions as
Treasurer and of the financial condition of the corporation.
Section 14. Bond. If required by the Board of Directors, the
Chief Financial Officer and Treasurer shall give the Corporation a
bond (which shall be renewed every six years) in such sum and with
such surety or sureties as shall be satisfactory to the Board of
Directors for the faithful performance of the duties of his office
and for the restoration to the Corporation, in case of his death,
resignation, retirement or removal from office, of all books,
papers, vouchers, money and other property of whatever kind in his
possession or under his control belonging to the Corporation.
Section 15. Assistant Treasurer(s). The Assistant Treasurer,
or if there shall be more than one, the Assistant Treasurers in the
order determined by the Board of Directors (or if there be no such
determination, then in the order of their election) shall, in the
absence of the Treasurer or in the event of his inability or
refusal to act, perform the duties and exercise the powers of the
Treasurer and shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.
Section 16. Indemnification. The Corporation shall indemnify
to the full extent authorized or permitted by the Tennessee General
Corporation Act any person made, or threatened to be made, a party
to any threatened, pending or completed action, suit or proceeding
(whether civil, criminal, administrative or investigative) by
reason of the fact that he, his testator or intestate is or was an
officer of the Corporation or serves or served as a director or
officer of any other enterprise at the request of the Corporation.
ARTICLE V
CAPITAL STOCK
Section 1. Certificate. Every holder of stock in the
Corporation shall be entitled to have a certificate signed by, or
in the name of the Corporation by, the Chairman of the Board, the
Chief Executive Officer or the President and the Chief Operating
Officer or a Vice President or the Treasurer or an Assistant
Treasurer, or the Secretary or an Assistant Secretary of the
Corporation, certifying the number of shares owned by him in the
Corporation.
Section 2. Facsimile Signatures. Where a certificate is
countersigned (1) by a transfer agent other than the Corporation or
its employee, or (2) by a registrar other than the Corporation or
its employee, any other signature on the certificate may be
facsimile. In case an officer, transfer agent or registrar who has
signed or whose facsimile signature has been placed upon a
certificate shall have ceased to be such officer, transfer agent or
registrar before such certificate is issued, it may be issued by
the Corporation with the same effect as if he were such officer,
transfer agent or registrar at the date of issuance.
Section 3. Notice of Restrictions. Each certificate of stock
which is restricted or limited as to its transferability or voting
rights, or which is callable under the Charter, which is preferred
or limited as to dividends or rights upon voluntary or involuntary
dissolution, shall have a notice of such restriction, limitation or
preference conspicuously stated on the face or back of the
certificate. Upon the removal of expiration of any such
restriction or limitation, the holder of such certificate shall be
entitled to receive a new certificate upon the surrender of the old
restricted or limited certificates, and the payment of the
reasonable expenses of the Corporation incurred in connection
therewith.
Section 4. Re-issuance of Certificates. The Board of
Directors may direct a new certificate or certificates to be issued
in place of any certificate or certificates theretofore issued by
the Corporation alleged to have been lost, stolen or destroyed,
upon the making of an affidavit of that fact by the person claiming
the certificate of stock to be lost, stolen or destroyed. When
authorizing such issue of a new certificate or certificates, the
Board of Directors may, in its discretion and as a condition
precedent to the issuance thereof, require the owner of such lost,
stolen or destroyed certificate or certificates, or his legal
representative, to advertise the same in such manner as it shall
require and/or to give the Corporation a bond in such sum as it may
direct as indemnity against any claim that may be made against the
Corporation with respect to the certificate alleged to have been
lost, stolen or destroyed.
Section 5. Transfer of Shares. The Corporation shall
register a transfer of a stock certificate presented to it for
transfer if:
(a) the certificate is endorsed by the appropriate person or
persons;
(b) the signature of the appropriate person or persons has
been guaranteed by a national banking association, a bank organized
and operating under the statutes of the State Tennessee, or a
member of the National Association of Security Dealers, and
reasonable assurance is given that the endorsements are effective,
unless the Secretary of the Corporation waives such requirements;
(c) there has been compliance with any applicable law
relating to the collection of taxes; and
(d) the transfer is in fact rightful or is to a bona fide
purchaser.
Section 6. Endorsements. An endorsement of the stock
certificate in registered form is made when an appropriate person
signs on it or on a separate document an assignment or transfer of
it, or a power to assign or transfer it, or when the signature of
this person is written without more upon the back of the
certificate. An endorsement may be in blank, which includes an
endorsement to bearer, or special, which specifies the person to
whom the stock is to be transferred, or who has the power to
transfer it. The Corporation may elect to require reasonable
assurance beyond that specified in this Section.
Section 7. Registered Stockholders. The Corporation shall be
entitled to recognize the exclusive right of a person registered on
its books as the owner of shares to receive dividends, and to vote
as such owner, and to hold liable for calls and assessments a
person registered on its books as the owner of shares, and shall
not be bound to recognize any equitable or other claim to or
interest in such share or shares on the part of any other person,
whether or not it shall have express or other notice thereof,
except as otherwise provided by the laws of Tennessee.
ARTICLE VI
DIVIDENDS, SURPLUS AND RESERVE
Section 1. Dividends. The Board of Directors may, from time
to time, declare and the Corporation may pay, dividends on its
outstanding shares in cash, property or its own shares, except
where the corporation is insolvent, as that term is defined in
Section 48-1-102 (14), Tennessee Code Annotated, or when the
payment thereof would render the Corporation insolvent, or when the
declaration of payment thereof would be contrary to any
restrictions contained in the Charter, these Bylaws, or in any
applicable valid contract. The declaration and payment of any such
dividend shall be in accordance with Section 48-1-511, Tennessee
Code Annotated, as it may be amended from time to time.
Section 2. Capital Distributions. The Board of Directors may
distribute to the shareholders of the Corporation out of capital
surplus, a portion of its assets, in cash or property, subject to
the following provisions:
(a) no such distribution shall be made at a time when the
Corporation is insolvent or when such distribution would render the
Corporation insolvent;
(b) no such distribution shall be made unless such
distribution is authorized by the affirmative vote of the holders
of the majority of all of the outstanding shares of stock entitled
to vote thereon;
(c) no such distribution shall be made to the holders of any
class of shares unless all cumulative dividends accrued on all
preferred or special classes of shares entitled to preferential
dividends shall have been fully paid;
(d) no such distribution shall be made to the holders of any
class of shares which would reduce the remaining net assets of the
Corporation below the aggregate preferential amount payable in the
event of voluntary liquidation to the holders of shares having
preferential rights to the assets of the Corporation in the event
of liquidation;
(e) each such distribution, when made, shall be identified as
a distribution from capital surplus and the amount per share shall
be disclosed to the shareholders receiving the same, concurrently
with the distribution thereof.
Section 3. Increases of Capital Surplus. The capital surplus
of the Corporation may be increased from time to time by Resolution
of the Board, directing that all or part of the earned surplus of
the Corporation be transferred to capital surplus. The Board of
Directors may, by Resolution apply any part or all of the capital
surplus of the Corporation to the reduction or elimination of any
deficit arising from losses however incurred; provided, however,
that the earned surplus has first been exhausted by charging such
losses to earned surplus and then only to the extent that such
losses exceed the earned surplus. Each such application of capital
surplus shall, to the extent thereof, effect a reduction of capital
surplus.
Section 4. Seal. The Corporation shall have a corporate
seal. The presence or absence of a seal on any instrument shall
not affect the character or validity, or legal effect thereof in
any respect. The affixing of a seal shall not be necessary for the
execution of any instrument or document by the Corporation.
ARTICLE VII
AMENDMENTS
Section 1. Shareholders and Board of Directors. Subject to
the provisions of the Charter of the Corporation, these bylaws may
be altered, amended, or repealed or new bylaws may be adopted by
the vote of a majority of all of the shareholders or by the
majority vote of the entire Board of Directors, when such power is
conferred upon the Board of Directors by the Charter, at any
regular meeting of the shareholders or of the Board of Directors or
at any special meeting of the shareholders or of the board of
directors if notice of such alteration, amendment, repeal or
adoption of new bylaws be contained in the notice of such special
meeting.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 1. Fiscal Year. The fiscal year of the Corporation
shall be fixed by resolution of the Board of Directors.
Section 2. Insurance. The Corporation may purchase and
maintain insurance on behalf of any person who is or was or has
agreed to become a director or officer of the Corporation, or is or
was serving at the request of the Corporation as a director or
officer of another corporation, partnership, joint venture, trust
or other enterprise against any liability asserted against him and
incurred by him or on his behalf in any such capacity, or arising
out of his status as such, whether or not the Corporation would
have the power to indemnify him against such liability under the
provisions of this Article, provided that such insurance is
available on acceptable terms, which determination shall be made by
a vote of a majority of the entire Board of Directors.
Section 3. Savings Clause. If this Article or any portion
hereof shall be invalidated on any ground by any court of competent
jurisdiction, then the Corporation may nevertheless indemnify each
director or officer of the Corporation as to costs, charges and
expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement with respect to any action, suit or proceeding,
whether civil, criminal, administrative or investigative, including
an action by or in the right of the Corporation, to the full extent
permitted by any applicable portion of this Article that shall not
have been invalidated and to the full extent permitted by
applicable law.
Section 4. Notices. Whenever, under the provisions of the
statutes or of the Charter or of these Bylaws, notice is required
to be given to any director or shareholder, it shall not be
construed to mean personal notice, but such notice may be given in
writing, by mail, addressed to such director or shareholder at his
address as it appears on the records of the Corporation, with
postage thereon prepaid, and such notice shall be deemed to be
given at the time when the same shall be deposited in the United
States mail. Notice to directors may also be given by telegram or
electronic facsimile, in which event it shall be deemed to have
been given when deposited with a telegraph or electronic facsimile
office for transmission.
Section 5. Indemnification. Notwithstanding anything in the
Corporation's Charter to the contrary, the Corporation shall be
permitted, but shall not be required, to indemnify and hold
harmless any employee or agent of the Corporation made, or
threatened to be made, a party to any threatened, pending or
completed action, suit or proceeding, whether, civil, criminal,
administrative or investigative.
EXHIBIT 11.1
STATEMENT RE: COMPUTATION OF HISTORICAL EARNINGS PER COMMON SHARE
PROFFITT'S, INC. AND SUBSIDIARIES
(in thousands, except per share amounts)
THREE MONTHS ENDED SIX MONTHS ENDED
JULY 29, JULY 30, JULY 29, JULY 30,
1995 1994 1995 1994
PRIMARY:
Average shares outstanding 10,210 9,793 10,142 9,619
Net effect of dilutive stock
options--based on the treasury
stock method using average
market price 224 131 155 140
------- ------ ------ ------
Total 10,434 9,924 10,297 9,759
======= ====== ====== ======
Net income $ 1,084 $ 811 $3,886 $1,211
Less preferred stock dividends (487) (537) (975) (718)
------- ------ ------ ------
Net income available to common
shareholders $ 597 $ 274 $2,911 $ 493
======= ====== ====== ======
Primary earnings per common share $ 0.06 $ 0.03 $ 0.28 $ 0.05
======= ====== ====== ======
FULLY DILUTED:
Average shares outstanding 10,210 9,793 10,142 9,619
Net effect of dilutive stock
options--based on the treasury
stock method using period-end
market price if higher than
average price 258 133 174 141
Assumed conversion of 4.75%
subordinated debenture 2,020 2,020 2,020 2,020
Assumed conversion of preferred
stock 1,422 1,545 1,422 1,033
------- ------ ------ ------
Total 13,910 13,491 13,758 12,813
======= ====== ====== ======
Income before interest adjustment $1,084 $ 811 $3,886 $1,211
Add 4.75% convertible subordinated
debenture interest, net of
federal income tax effect 625 625 1,250 1,250
------- ------ ------ ------
Adjusted net income $1,709 $1,436 $5,136 $2,461
======= ====== ====== ======
Fully diluted earnings per
common share $ 0.12 $ 0.11 $ 0.37 $ 0.19
====== ====== ====== ======
Note/For each period shown, the fully diluted earnings per common share
calculation is anti-dilutive, and therefore, no fully diluted presentation
is needed.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED CONSOLIDATED BALANCE SHEET AS OF JULY 29, 1995 AND THE CONDENSED
CONSOLIDATED STATEMENT OF INCOME FOR THE SIX MONTHS ENDED JULY 29, 1995
(UNAUDITED) AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CIK> 0000812900
<NAME> PROFFITT'S, INC.
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> FEB-3-1996
<PERIOD-END> JUL-29-1995
<CASH> 1,108,000
<SECURITIES> 0
<RECEIVABLES> 14,536,000
<ALLOWANCES> 0
<INVENTORY> 172,755,000
<CURRENT-ASSETS> 205,463,000
<PP&E> 311,820,000
<DEPRECIATION> 0
<TOTAL-ASSETS> 584,026,000
<CURRENT-LIABILITIES> 85,373,000
<BONDS> 310,270,000
<COMMON> 0
0
0
<OTHER-SE> 188,383,000
<TOTAL-LIABILITY-AND-EQUITY> 584,026,000
<SALES> 309,110,000
<TOTAL-REVENUES> 316,746,000
<CGS> 196,750,000
<TOTAL-COSTS> 196,750,000
<OTHER-EXPENSES> 23,531,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 9,570,000
<INCOME-PRETAX> 6,663,000
<INCOME-TAX> 2,777,000
<INCOME-CONTINUING> 3,886,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,886,000
<EPS-PRIMARY> .28
<EPS-DILUTED> .28
</TABLE>
