<PAGE>
As filed with the Securities and Exchange Commission on November 10, 1997
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
-----------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
November 5, 1997
RYKOFF-SEXTON, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-8105 95-2134693
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification Number)
incorporation)
613 Baltimore Drive
Wilkes-Barre, Pennsylvania 18702-7944
(Address of principal executive offices) (Zip Code)
(717) 830-7100
(Registrant's telephone number, including area code)
<PAGE>
Item 5. Other Events.
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On November 5, 1997, Rykoff-Sexton, Inc., a Delaware corporation ("RSI"),
JP Foodservice, Inc., a Delaware corporation ("JPFI"), and Hudson Acquisition
Corp., a Delaware corporation and a wholly-owned subsidiary of JPFI ("Hudson"),
entered into Amendment No. 2 ("Amendment No. 2") to the Agreement and Plan of
Merger (the "Merger Agreement"), dated as of June 30, 1997, as amended as of
September 3, 1997, by and among RSI, JPFI and Hudson. Under the Merger Agreement
as amended by Amendment No. 2, stockholders of RSI will receive shares of JPFI
common stock at a fixed exchange ratio of 0.775 of a share of JPFI common stock
for each share of RSI common stock held. Prior to the effectiveness of Amendment
No. 2, the fixed exchange ratio was 0.84. The foregoing description of Amendment
No. 2 is not complete and is qualified in its entirety by reference to the text
of such Amendment No. 2, which is included as Exhibit 2.3 hereto and is hereby
incorporated herein by reference.
In connection with entering into Amendment No. 2, RSI and JPFI issued a
joint press release, dated November 5, 1997. The foregoing description of such
joint press release is not complete and is qualified in its entirety by
reference to the text of such joint press release, which is attached as Exhibit
99.1 hereto and is hereby incorporated herein by reference.
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<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
- ------- ------------------------------------------------------------------
The following exhibits are filed as part of this report:
2.1 Agreement and Plan of Merger, dated as of June 30, 1997, by and among
Rykoff-Sexton, Inc., JP Foodservice, Inc. and Hudson Acquisition Corp.
(incorporated by reference to Rykoff-Sexton, Inc.'s Current Report on Form
8-K, filed July 10, 1997, dated as of June 30, 1997).
2.2 Amendment No. 1 to Agreement and Plan of Merger, dated as of September 3,
1997, by and among Rykoff-Sexton, Inc., JP Foodservice, Inc. and Hudson
Acquisition Corp. (incorporated by reference to Rykoff-Sexton, Inc.'s
Current Report on Form 8-K, filed September 15, 1997, dated as of
September 3, 1997).
2.3 Amendment No. 2 to Agreement and Plan of Merger, dated as of November 5,
1997, by and among Rykoff-Sexton, Inc., JP Foodservice, Inc. and Hudson
Acquisition Corp.
99.1 Joint Press Release, dated November 5, 1997.
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<PAGE>
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this Current Report on Form 8-K to be signed on
its behalf by the undersigned thereunto duly authorized.
RYKOFF-SEXTON, INC.
By /s/ Christopher Mellon
-----------------------------------------------
Christopher Mellon
Vice President and Controller
Date: November 10, 1997
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<PAGE>
EXHIBIT INDEX
-------------
2.1 Agreement and Plan of Merger, dated as of June 30, 1997, by and among
Rykoff-Sexton, Inc., JP Foodservice, Inc. and Hudson Acquisition Corp.
(incorporated by reference to Rykoff-Sexton, Inc.'s Current Report on Form
8-K, filed July 10, 1997, dated as of June 30, 1997).
2.2 Amendment No. 1 to Agreement and Plan of Merger, dated as of September 3,
1997, by and among Rykoff-Sexton, Inc., JP Foodservice, Inc. and Hudson
Acquisition Corp. (incorporated by reference to Rykoff-Sexton, Inc.'s
Current Report on Form 8-K, filed September 15, 1997, dated as of September
3, 1997).
2.3 Amendment No. 2 to Agreement and Plan of Merger, dated as of November 5,
1997, by and among Rykoff-Sexton, Inc., JP Foodservice, Inc., and Hudson
Acquisition Corp.
99.1 Joint Press Release, dated November 5, 1997.
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<PAGE>
EXHIBIT 2.3
CONFORMED COPY
--------------
AMENDMENT NO. 2 TO AGREEMENT AND PLAN OF MERGER
AMENDMENT NO. 2 ("Amendment No. 2"), dated as of November 5, 1997, to
the Agreement and Plan of Merger (the "Merger Agreement"), dated as of June 30,
1997, by and among JP Foodservice, Inc., a Delaware corporation ("JPFI"),
Rykoff-Sexton, Inc., a Delaware corporation ("RSI"), and Hudson Acquisition
Corp., a Delaware corporation and a wholly-owned subsidiary of JP Foodservice
("Merger Sub").
WHEREAS, JPFI, RSI and Merger Sub have previously executed and
delivered the Merger Agreement; and
WHEREAS, JPFI, RSI and Merger Sub have previously executed and
delivered Amendment No. 1 to the Agreement and Plan of Merger ("Amendment No.
1"); and
WHEREAS, JPFI, RSI and Merger Sub desire to further amend the Merger
Agreement as set forth herein and pursuant to Section 7.3 thereof (it being
understood that all references to the Merger Agreement herein or any provision
thereof refer to such Merger Agreement or provision as amended by Amendment No.
1);
NOW, THEREFORE, JPFI, RSI and Merger Sub agree as follows:
1. Definitions. Capitalized terms used but not expressly defined
herein shall have the meanings accorded such terms in the Merger Agreement.
2. Amendment of Section 2.1(b) of Merger Agreement. The first
sentence of Section 2.1(b) of the Merger Agreement is hereby amended to read, in
its entirety, as follows:
Subject to Section 2.2(e), each issued and outstanding share of RSI
Common Stock (other than shares to be canceled in accordance with
Section 2.1(a)) shall be converted into the right to receive 0.775
(the "Exchange Ratio") validly issued, fully paid and non-assessable
shares of common stock, par value $.01 per share ("JPFI Common
Stock"), of JPFI.
All references to the Exchange Ratio in the Merger Agreement or in any other
instrument or agreement contemplated thereby shall be deemed to refer to the
Exchange Ratio as amended hereby.
<PAGE>
3. Amendment of Section 2.1(e)(iii). Section 2.1(e)(iii) of the
Merger Agreement is hereby amended and restated in its entirety as follows:
"(iii) At the Effective Time, the warrants, dated May 17, 1996,
between RSI and each of Teachers Insurance and Annuity Association of
America, the Nippon Credit Bank, Ltd. and Dresdner Bank AG (each, an
"Assumed Warrant") shall be assumed by JPFI and shall constitute a
warrant to acquire, otherwise on the same terms and conditions as were
applicable under such Assumed Warrant, a number of shares of JPFI
Common Stock determined pursuant to the terms of Sections 2 and 3 of
the Assumed Warrants, copies of which have been delivered to JPFI.
4. Amendment of Article III. Article III of the Merger Agreement is
hereby amended and restated in its entirety to read as set forth on Schedule IV
hereto.
5. Amendment of Section 4.1(a) of Merger Agreement. (a) The
introductory paragraph to Section 4.1(a) of the Merger Agreement is hereby
amended in its entirety as follows:
"(a) Conduct of Business by RSI. Except (i) as disclosed to an
executive officer of JPFI in writing prior to the date of Amendment
No. 2 to this Agreement ("Amendment No. 2"), or (ii) as disclosed in
(A) the RSI Disclosure Schedule, (B) any RSI Filed SEC Document, or
(C) any press release issued by RSI prior to the date of this
Amendment (each, an "RSI Press Release"), (iii) as otherwise expressly
contemplated by this Agreement or the transactions contemplated
thereby, or (iv) as consented to by JPFI in writing, such consent not
to be unreasonably withheld or delayed, during the period from the
date of this Agreement to the Effective Time, (I) RSI shall, and shall
cause its subsidiaries to, carry on their respective businesses in the
ordinary course consistent with past practice and in compliance in all
material respects with all applicable laws and regulations, and, to
the extent consistent therewith, use all reasonable efforts to
preserve intact their current business organizations, (II) except as
may be required by law or any plan, program, contract or arrangement
in effect on the date of Amendment No. 2, during the period from the
date of this Agreement to the Effective Time, RSI shall not, and shall
not permit any of its subsidiaries to, (A) grant to any current or
former director, officer, any regional vice president or president of
any division of RSI or its subsidiaries any increase in compensation,
bonus or other benefits, except as required by employment agreements
in effect as of April 27, 1996; (B) grant to any such current or
former director, officer, any regional vice president or president of
any division any increase in severance or termination pay; or (C)
enter into, or amend, any employment, deferred compensation,
consulting, severance, termination or indemnification agreement with
any such current or former director, officer, regional vice president
or president of any division, or (III) except as may be required by
law or any plan, program, contract or arrangement in effect on the
date of Amendment No. 2,
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<PAGE>
during the period from the date of Amendment No. 2 to the Effective
Time, RSI shall not, and shall not permit any of its subsidiaries to
adopt or amend, and to RSI's knowledge since October 8, 1997, RSI has
not and has not permitted any of its subsidiaries to, adopt or amend,
any collective bargaining agreement (other than renegotiations
required by any such collective bargaining agreement), employment
agreement, consulting agreement, severance agreement or any bonus,
pension, profit sharing, deferred compensation, incentive
compensation, stock ownership, stock purchase, stock option, phantom
stock, retirement, vacation, severance, disability, death benefit,
hospitalization, medical or other plan, arrangement or understanding
providing benefits to any current or former employee, officer or
director of RSI or any of its wholly-owned subsidiaries (collectively,
the "RSI Benefit Plans"), in any manner which would, individually, or
in the aggregate, involve amounts in excess of $1,000,000. Anything in
this Section 4.1(a) to the contrary notwithstanding, RSI and any RSI
subsidiary shall not be deemed in violation of this Section 4.1(a) if
such violation is cured prior to the Effective Time. Without limiting
the generality of the foregoing (but subject to the above exceptions),
during the period from the date of this Agreement to the Effective
Time, RSI shall not, and shall not permit any of its subsidiaries to:"
(b) Existing Section 4.1(a)(vi) of the Merger Agreement is hereby
deleted in its entirety and replaced with the following:
"make any tax election that individually or in the aggregate
would have a material adverse effect on RSI or any of its tax
attributes or settle or compromise any material income tax liability"
6. Amendment of Section 4.1(b) of Merger Agreement. (a) The
introductory paragraph to Section 4.1(b) of the Merger Agreement is hereby
amended in its entirety as follows:
"(b) Conduct of Business by JPFI. Except (i) as disclosed to an
executive officer of RSI in writing prior to the date of Amendment
No.2, or (ii) as disclosed in (A) the JPFI Disclosure Schedule as
amended by Schedule V to Amendment No. 2, (B) any JPFI Filed SEC
Document, or (C) any press release issued by JPFI prior to the date of
Amendment No. 2 (each, a "JPFI Press Release"), (iii) as otherwise
expressly contemplated by this Agreement or the transactions
contemplated thereby, or (iv) as consented to by RSI in writing, such
consent not to be unreasonably withheld or delayed, during the period
from the date of this Agreement to the Effective Time, (I) JPFI shall,
and shall cause its
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<PAGE>
subsidiaries to, carry on their respective businesses in the ordinary
course consistent with past practice and in compliance in all material
respects with all applicable laws and regulations, and, to the extent
consistent therewith, use all reasonable efforts to preserve intact
their current business organizations , (II) except as may be required
by law or any plan, program, contract or arrangement in effect on the
date of Amendment No. 2, during the period from the date of this
Agreement to the Effective Time, JPFI shall not, and shall not permit
any of its subsidiaries to, (A) grant to any current or former
director, officer, any regional vice president or president of any
division of JPFI or its subsidiaries any increase in compensation,
bonus or other benefits, except as required by employment agreements
in effect as of June 29, 1996; (B) grant to any such current or former
director, officer, any regional vice president or president of any
division any increase in severance or termination pay, or (C) enter
into, or amend, any employment, deferred compensation, consulting,
severance, termination or indemnification agreement with any such
current or former director, officer or any regional vice president or
president of any division, or (III) except as may be required by law
or any plan, program, contract or arrangement in effect on the date of
Amendment No. 2, during the period from the date of Amendment No. 2 to
the Effective Time, JPFI shall not, and shall not permit any of its
subsidiaries to adopt or amend, and to JPFI's knowledge since October
8, 1997, JPFI has not and has not permitted any of its subsidiaries
to, adopt or amend, any collective bargaining agreement (other than
renegotiations required by any such collective bargaining agreement),
employment agreement, consulting agreement, severance agreement or any
bonus, pension, profit sharing, deferred compensation, incentive
compensation, stock ownership, stock purchase, stock option, phantom
stock, retirement, vacation, severance, disability, death benefit,
hospitalization, medical or other plan, arrangement or understanding
providing benefits to any current or former employee, officer or
director of JPFI or any of its wholly-owned subsidiaries
(collectively, the "JPFI Benefit Plans"), in any manner which would,
individually, or in the aggregate, involve amounts in excess of
$1,000,000. Anything in this Section 4.1(b) to the contrary
notwithstanding, JPFI and any JPFI subsidiary shall not be deemed in
violation of this Section 4.1(b) if such violation is cured prior to
the Effective Time. Without limiting the generality of the foregoing
(but subject to the above exceptions), during the period from the date
of this Agreement to the Effective Time, JPFI shall not, and shall not
permit any of its subsidiaries to:"
(b) Existing Section 4.1(b)(vi) of the Merger Agreement is hereby
deleted in its entirety and replaced with the following:
"make any tax election that individually or in the aggregate
would have a material adverse effect on JPFI or any of its tax
attributes or settle or compromise any material income tax liability"
7. Amendment of Section 5.7.
------------------------
(a) Section 5.7(a) of the Merger Agreement is hereby amended to add
at the end of the penultimate sentence the following:
"The certificate of incorporation and bylaws of the Surviving
Corporation shall contain the provisions (and the Surviving
Corporation's Certification of Incorporation and by-laws may be
amended to incorporate such provisions) with respect to
indemnification that are set forth in the certificate of incorporation
and
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<PAGE>
bylaws of RSI (in each case in effect as of June 30, 1997 and as
provided to JPFI prior to such date), which provisions shall not be
amended, repealed or otherwise modified, except as required by law,
for a period of six years from the Effective Time in any manner that
would affect adversely the rights thereunder of individuals who at (or
at any time prior to) the Effective Time were directors or officers of
RSI or its subsidiaries (or any of its predecessors).
(b) Section 5.7(b) of the Merger Agreement is hereby amended and
restated in its entirety as follows:
"(b) In the event that JPFI, the Surviving Corporation or any of
their respective successors or assigns (i) consolidates with or merges
into any other person and is not the continuing or surviving
corporation or entity of such consolidation or merger or (ii)
transfers or conveys all or substantially all of its properties and
assets to any person, then, and in each such case, proper provision
will be made so that the successors and assigns of JPFI or the
Surviving Corporation (as the case may be) assume the obligations set
forth in this Section 5.7."
(c) The Merger Agreement is hereby amended by the addition of
the following new Section 5.7(e):
"(e) Without limiting the generality of the foregoing, the
provisions of this Section 5.7 shall apply to any litigation,
action, suit, claim, investigation or proceeding described in
Item 11 to Schedule II to Amendment No. 2."
8. Amendment of Section 5.18. Section 5.18 of the Merger
Agreement is hereby amended to add at the end thereof the following:
"Notwithstanding the foregoing, each of RSI and JPFI agrees
that taking into account the modification of the Exchange Ratio,
substantial authority exists as of the date of Amendment No. 2
that, as of the Effective Time, the position set forth in this
Section 5.18 shall continue to be applicable. Without the prior
written consent of RSI, JPFI agrees that it shall not, and shall
not permit any of its subsidiaries to, take any action not
required by any binding contract or plan in effect as of the date
of Amendment No. 2 or by applicable law that would prevent the
statement set forth in the preceding sentence from being true and
correct as of the Effective Time, including without limitation,
any action with respect to the issuance of shares of its capital
stock, any other voting securities or any securities convertible
into, or any rights, warrants or options to acquire, any such
shares, voting securities or convertible securities, whether or
not permitted by any other provision of this Agreement."
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<PAGE>
9. Amendment of Section 6.2(a) of the Merger Agreement.
Section 6.2(a) of the Merger Agreement shall be amended to read in its
entirety as follows:
"(a) Representations and Warranties. The representations
and warranties of RSI set forth herein shall be true and correct
both when made, and at and as of the Closing Date, as if made at
and as of such time (except (i) to the extent expressly made as
of an earlier date, in which case such representations and
warranties shall be true and correct as of such date, and (ii)
for the representations and warranties set forth in Sections
3.1(f) and 3.1(g)(i), in which case such representations and
warranties shall be true and correct as of the date of Amendment
No. 2) except where the failure of such representations and
warranties to be so true and correct (without giving effect to
any limitation to "materiality" or "material adverse effect" set
forth therein) does not have, and is not likely to have,
individually or in the aggregate, a material adverse effect on
RSI.
10. Amendment of Section 6.2(b) of Merger Agreement. Section
6.2(b) of the Merger Agreement is hereby amended by deleting the period at
the end thereof and by substituting therefor the following:
"; provided, however, that the obligations of RSI set forth
in Clauses (II) and (III) of Section 4.1(a) shall have been
performed in all respects, without reference to any limitation on
such RSI obligations in respect of "materiality" or "material
adverse effect."
11. Amendment of Section 6.3(a) of the Merger Agreement.
Section 6.3(a) of the Merger Agreement shall be amended to read in its
entirety as follows:
"(a) Representations and Warranties. The representations
and warranties of JPFI set forth herein shall be true and correct
both when made, and at and as of the Closing Date, as if made at
and as of such time (except (i) to the extent expressly made as
of an earlier date, in which case such representations and
warranties shall be true and correct as of such date, and (ii)
for the representations and warranties set forth in Sections
3.2(f) and 3.2(g)(i), in which case such representations and
warranties shall be true and correct as of the date of Amendment
No. 2) except where the failure of such representations and
warranties to be so true and correct (without giving effect to
any limitation to "materiality" or "material adverse effect" set
forth therein) does not have, and is not likely to have,
individually or in the aggregate, a material adverse effect on
JPFI.
12. Amendment of Section 6.2(c) of Merger Agreement. Section
6.2(c) of the Merger Agreement and any cross references thereto are hereby
deleted in their entirety.
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<PAGE>
13. Amendment of Section 6.3(b) of Merger Agreement. Section
6.3(b) of the Merger Agreement is hereby amended by deleting the period at
the end thereof and by substituting therefor the following:
"; provided, however, that the obligations of JPFI set forth
in Clauses (II) and (III) of Section 4.1(b) shall have been
performed in all respects, without reference to any limitation on
such JPFI obligations in respect of "materiality" or "material
adverse effect."
14. Amendment of Section 6.3(c) of the Merger Agreement.
Section 6.3(c) of the Merger Agreement and any cross references thereto are
hereby deleted in their entirety.
15. Amendment of Section 7.1(c) of Merger Agreement. Section
7.1(c) of the Merger Agreement is hereby amended by inserting the following
between the phrases "agreements contained in this Agreement," and "which
breach or failure to perform":
"or if RSI shall have breached or failed to perform in any
respect its covenants and agreements set forth in Clause (II) or
Clause (III) of the first paragraph of Section 4.1(a),"
16. Amendment of Section 7.1(d) of Merger Agreement. Section
7.1(d) of the Merger Agreement is hereby amended by inserting the following
between the phrases "agreements contained in this Agreement," and "which
breach or failure to perform":
"or if JPFI shall have breached or failed to perform in any
respect its covenants and agreements set forth in Clause (II) or
Clause (III) of the first paragraph of Section 4.1(b),"
17. Amendment of Section 8.3. (a) Section 8.3(b) of the Merger
Agreement is hereby amended by adding the following to the end thereof:
"provided, however, that no change, effect, event,
occurrence or state of facts relating to, or arising or resulting
from, any of the following matters, regardless of the amounts
involved shall constitute a "material adverse change" or
"material adverse effect": (i) any actions taken or omitted to
be taken with the prior written approval of JPFI in anticipation
or reliance upon the consummation of the Merger or the
transactions contemplated thereby, (ii) any failure by RSI or its
subsidiaries to keep available the services of their current
officers or other employees, or to preserve any relationships
with those persons having business dealings with them; or (iii)
any of the matters disclosed in the RSI Disclosure Schedule, in
any RSI Filed SEC Document, in any RSI Press Release, or
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<PAGE>
otherwise disclosed to an executive officer of JPFI in writing by
RSI prior to the date of Amendment No. 2."
(b) Section 8.3 of the Merger Agreement is hereby amended to add
the following new Sections 8.3(f), (g), (h), (i) and (j):
"(f) "Securities Act" means the Securities Act of 1933, as
amended."
"(g) "RSI SEC Documents" means all required reports,
schedules, forms, statements and other documents (including
exhibits and all other information incorporated therein) filed
with the SEC by RSI since June 28, 1997, and the Form S-4 as
filed prior to the date of Amendment No. 2."
"(h) "JPFI SEC Documents" means all required reports,
schedules, forms, statements and other documents (including
exhibits and all other information incorporated therein) filed
with the SEC by JPFI since June 28, 1997 and the Form S-4 as
filed prior to the date of Amendment No. 2."
"(i) "To RSI's knowledge" shall mean the actual knowledge,
without any inquiry or investigation whatsoever, of Mark Van
Stekelenburg, RSI's Chairman, CEO and President, Robert J. Harter
Jr., RSI's Senior Vice President and General Counsel, Richard J.
Martin, RSI's Executive Vice President and Chief Financial
Officer, and Christopher Mellon, RSI's Vice President and
Controller. "To JPFI's knowledge" shall mean the actual
knowledge, without any inquiry or investigation whatsoever, of
Jim Miller, JPFI's Chairman of the Board, President and CEO,
David Abramson, JPFI's Senior Vice President and General
Counsel, Lewis Hay, III, JPFI's Senior Vice President and Chief
Financial Officer and George T. Megas, JPFI's Vice President-
Finance."
"(j) "Form S-4" means the registration statement on Form
S-4 to be filed with the SEC by JPFI in connection with the
issuance of JPFI Common Stock in the Merger."
18. Deemed Disclosure.
(a) The parties hereto agree that the matters set forth on the
Schedules to this Amendment (i) shall be, and hereby are, deemed to
have been disclosed in such sections of the RSI Disclosure Schedule
with respect to which such matters are relevant, in each case as of
the date of the Merger Agreement, and accordingly such disclosures
shall be, and hereby are, deemed to modify the representations and
warranties of RSI in the Merger Agreement as of such date; (ii) shall
not be
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<PAGE>
asserted by JPFI as a breach of the Merger Agreement; and (iii) shall
not be asserted by JPFI as the cause of a failure to be satisfied any
condition set forth in the Merger Agreement.
(b) Section 4.1 of the RSI Disclosure Schedule shall be amended
by adding Schedule I hereto thereto. Section 4.1 of the JPFI
Disclosure Schedule shall be amended by adding Schedule V hereto
thereto.
(c) The introduction to the JPFI and RSI Disclosure Schedules
shall be amended by adding the following sentence:
"All information set forth in the agreements, documents and
instruments referred to herein shall be deemed disclosed in the
following schedules as fully and completely as if set forth
herein. Any information disclosed in any of the following
schedules shall be deemed disclosed and incorporated into any
other schedule to the Merger Agreement where such disclosure
would be relevant."
19. Filings. As soon as practicable following the date of this
Amendment, RSI and JPFI shall prepare and file with the SEC an amendment to
the Joint Proxy Statement, and JPFI shall prepare and file with the SEC an
amendment to the Form S-4, in which the Joint Proxy Statement will be
included. The parties will use their best efforts to make such filings
within 10 days of the date of this Amendment. Each of RSI and JPFI shall
use best efforts to have the Form S-4 declared effective under the
Securities Act as promptly as practicable after such filing.
20. Release. (a) Each of JPFI and Merger Sub hereby waives,
and releases and discharges RSI, and its stockholders, affiliates,
successors, assigns, officers, directors, agents, representatives and
employees (collectively "Representatives") of RSI from, any claim for
damages (whether for loss of benefit of the bargain, costs or expenses or
otherwise), other claims, liabilities, damages and causes of action, in
each case to the extent related to or based on (i) any breach or alleged
breach of the Merger Agreement prior to the date of this Amendment, or (ii)
this Amendment, the subject matter thereof or any matter set forth on the
Schedules to this Agreement. This paragraph does not limit JPFI's or
Merger Sub's right to terminate the Merger Agreement in accordance with its
terms as amended hereby based on any such breach or alleged breach.
(b) RSI and its affiliates hereby waive, and release and
discharge JPFI, Merger Sub and the Representatives of each of them from,
any claim for damages (whether for loss of benefit of the bargain, costs or
expenses or otherwise), other claims, liabilities, damages and causes of
action, in each case to the extent related to or based on (i) any breach or
alleged breach of the Merger Agreement prior to the date of this Amendment,
or (ii) this Amendment, the subject matter thereof or any matter set forth
on the Schedules to this Agreement. This paragraph does not limit RSI's
right to terminate the Merger Agreement in accordance with its terms as
amended hereby based on any such breach or alleged breach.
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<PAGE>
21. Disclaimer of Projections. Each of RSI and JPFI
acknowledges that any financial projections that may have been or are
hereafter delivered to the other party (the "Financial Projections")
reflect a number of estimates and highly subjective assumptions and
judgments concerning anticipated results of operations. These assumptions
and judgments may or may not prove to be correct and there can be no
assurance that any projected results are attainable or will be realized.
Each of JPFI and RSI expressly disclaims any representation or warranty,
express or implied, as to the accuracy or completeness of the Financial
Projections and each of RSI and JPFI acknowledges that it has not relied
and will not rely on the Financial Projections, in connection with its
evaluation of the transactions contemplated by the Merger Agreement and
shall have no right to terminate this Agreement or to not consummate the
Merger on the basis of RSI's or JPFI's failure to achieve any Financial
Projections.
22. Authority.
(a) RSI has all requisite corporate power and authority to enter
into this Amendment. The execution and delivery of this Amendment and
the consummation by RSI of the transactions contemplated hereby has
been duly authorized by all necessary corporate action on the part of
RSI, including without limitation the due approval of this Amendment
by the Board of Directors of RSI (for the purposes contemplated by
Section 3.1(h) of the Agreement and otherwise) and a majority of the
ML Directors. This Amendment has been duly executed and delivered by
RSI and, assuming the due authorization, execution and delivery
thereof by each of JPFI and Merger Sub, constitutes the legal, valid
and binding obligation of RSI, enforceable against RSI in accordance
with its terms.
(b) Each of JPFI and Merger Sub has all requisite corporate
power and authority to enter into this Amendment. The execution and
delivery of this Amendment and the consummation by each of JPFI and
Merger Sub of the transactions contemplated hereby has been duly
authorized by all necessary corporate action on the part of each of
JPFI and Merger Sub, including without limitation the due approval of
this Amendment by the Board of Directors of JPFI (for the purposes
contemplated by Section 3.2(h) of the Agreement and otherwise). This
Amendment has been duly executed and delivered by each of JPFI and
Merger Sub, and assuming due authorization, execution and delivery
thereof by RSI, constitutes the legal, valid and binding obligation of
each of JPFI and Merger Sub, enforceable against each of JPFI and
Merger Sub in accordance with its terms.
23. Governing Law. This Amendment shall be governed by, and
construed in accordance with, the laws of the State of Delaware, regardless
of the laws that might otherwise govern under applicable principles of
conflict of laws thereof.
24. Counterparts. This Amendment may be executed in one or more
counterparts, all of which shall be considered one and the same agreement
and shall
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become effective when one or more counterparts have been signed by each of
the parties and delivered to the other parties.
25. Merger Agreement Confirmed. Except as amended hereby, the
Merger Agreement is ratified and confirmed in all respects. All
representations, warranties, covenants or agreements of the parties set
forth in the Merger Agreement, as amended hereby, shall be deemed to have
been made June 30, 1997 and as of the date hereof, except as otherwise
expressly provided therein or herein, and RSI and JPFI hereby waive any
right to terminate, or not consummate the transactions contemplated by, the
Merger Agreement according to its original terms and agree that any such
rights shall arise only out of the provisions of the Merger Agreement as
amended hereby.
26. Notice of Breaches. JPFI and RSI shall give prompt written
notice to the other party to the extent it has knowledge of breach by it or
such other party of the covenants and agreements set forth in Section
4.1(a) or 4.1(b).
[The remainder of this page is intentionally left blank.]
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<PAGE>
IN WITNESS WHEREOF, JPFI, RSI and Merger Sub have caused this
Amendment to be signed by their respective officers thereunto duly authorized,
all as of the date first written above.
JP FOODSERVICE, INC.
By: /s/ James L. Miller
-----------------------------------------
Name: James L. Miller
Title: Chairman, President and Chief
Executive Officer
RYKOFF-SEXTON, INC.
By: /s/ Mark Van Stekelenburg
-----------------------------------------
Name: Mark Van Stekelenburg
Title: Chairman, President and Chief
Executive Officer
HUDSON ACQUISITION CORP.
By: /s/ James L. Miller
-----------------------------------------
Name: James L. Miller
Title: Chairman, President and Chief
Executive Officer
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<PAGE>
EXHIBIT 99.1
WEDNESDAY NOVEMBER 5 10:06 AM EST
COMPANY PRESS RELEASE
JP FOODSERVICE AND RYKOFF-SEXTON REVISER MERGER
TERMS; EXPECT TO CLOSE BY YEAR END
COLUMBIA, Md. and WILKES-BARRE, Pa., Nov. 5 /PRNewswire/ -- JP Foodservice,
Inc. ("JP") (NYSE:JPF - news) of Columbia, Maryland, and Rykoff-Sexton, Inc.
("Rykoff") (NYSE:RYK), of Wilkes-Barre, Pennsylvania, which also does business
under the US Foodservice name, today announced that they have amended the merger
agreement JP and Rykoff signed on June 30, 1997.
Under the amended merger agreement, Rykoff shareholders will receive shares of
JP at a fixed exchange ratio of 0.775 JP common shares for each Rykoff common
share they hold. Prior to the amendment, the fixed exchange ratio was 0.84.
Based on the new exchange ratio, Rykoff is valued at $1.4 billion including
assumed debt.
The amendment also eliminates certain of the original closing conditions from
the merger agreement. The Boards of Directors of Rykoff and JP each have, by a
unanimous vote of those directors voting, approved the amendment to the merger
agreement and recommended that Rykoff's and JP's stockholders vote in favor of
the amended Agreement and Plan of Merger and the transactions contemplated
thereby.
As before, the merger will be accounted for using the pooling-of-interest method
and is intended to qualify as a tax-free reorganization.
Mr. Jim Miller, Chairman, President, and Chief Executive Officer of JP, stated:
"We are pleased that we've been able to work out a revised agreement with
Rykoff-Sexton. The new agreement was precipitated by a change in the relative
values of both companies from the time of our original agreement last June."
Rykoff and JP stated that the new terms reflect changes in debt levels from the
end of the third quarter ended March 29, 1997 to the present which were
attributable to a number of factors, primarily changes in timing of sales by
Rykoff of certain idle facilities, delays in utilization of tax benefits
anticipated by Rykoff and higher investment levels in Rykoff's computer related
assets.
The amended terms also give effect to higher than anticipated levels of
non-recurring costs associated with the consolidation
<PAGE>
and integration of US Foodservice and Rykoff operations. Mr. Mark Van
Stekelenburg, Rykoff's Chairman, CEO and President said, "The accelerated
consolidation of US Foodservice, which is now essentially complete, had a
negative impact on our sales and expenses in fiscal 1997, but has nevertheless
allowed us to better focus our business going forward."
The new terms reflect strengths in JP's business, including the acquisition of
new accounts and the Outwest Meat Company acquisition.
Mr. Miller further stated: "Delays in closing the merger will likely push back
the realization of projected synergies, and thus are expected to dilute slightly
our fiscal year 1998 earnings. However, with many of the integration plans well
underway, we believe that the merger will be accretive to our calendar year 1998
results and beyond.
"There are significant strategic benefits of this merger which will create
incremental value for both JP and Rykoff shareholders. We are fortunate to have
this phase of the merger behind us, and I am looking forward to working with the
foodservice professionals at both companies to continue the building of an
outstanding company."
Based on JP's closing stock price of $31.50 on Tuesday, November 4, 1997, the
0.775 exchange ratio, the approximately 29.6 million shares of Rykoff common
stock on a fully diluted basis, and the assumption by JP of approximately $670
million of Rykoff debt, the transaction has a total enterprise value of $1.4
billion. Current shareholders of JP and Rykoff will own approximately equal
stakes in the combined enterprise.
"After careful consideration of the relative contributions to be made by the two
companies, the Rykoff Board has determined that this course of action represents
the best alternative to Rykoff stockholders," said Van Stekelenburg. "As a
result of this amendment, we are able to protect the value from the original
transaction for our shareholders, increase the certainty of a timely
consummation of the merger, and enhance the likelihood of a quick and
successful integration of the operations of JP and our company. Rykoff and JP
have jointly developed a merger plan to maximize efficiencies, and are ready to
implement the plan upon consummation of the merger."
Both companies plan on mailing proxies to their respective shareholders within
approximately one week of SEC effectiveness of JP's registration statement and
plan on holding special shareholder meetings one month following mailing.
Assuming the merger is approved by shareholders, the merger is expected to
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close immediately following shareholder approval which is anticipated to occur
next month.
Rykoff provides over 35,000 food and non-food related items to approximately
100,000 restaurants and other dining establishments, health care, and
educational facilities, and wherever food is prepared away from home, and
employs over 8,500 foodservice professionals. Distribution centers,
manufacturing operations and contract design facilities are located throughout
the United States.
JP Foodservice distributes food and related products to restaurants and
institutional foodservice establishments in the Mid-Atlantic, Midwestern, and
Northeastern regions of the United States as well as Las Vegas, Nevada. JP
markets and distributes 30,000 national, private label, and signature brand
items to over 34,000 customers, including restaurants, hotels, healthcare
facilities, cafeterias and schools, and employs over 3,500 foodservice
professionals. The Company's diverse customer base encompasses both independent
and chain businesses, including Old Country Buffet, Perkins Family Restaurants,
Subway, Compass Group, Pizzeria Uno, and Ruby Tuesday.
The statements in this press release concerning management's expectations
regarding acquisitions and future operations constitute "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. These statements are subject
to risks and uncertainties that could cause either JP Foodservice, Inc.'s or
Rykoff-Sexton, Inc.'s actual operating results to differ materially. Such risks
and uncertainties include the sensitivity of both companies' businesses to
national and regional economic conditions, the effects of inflation and
deflation in food prices, the highly competitive markets in which both companies
operate and difficulties in achieving costs savings and operating synergies in
integrating the merged businesses. JP's Current Report on Form 8-K filed with
the Securities and Exchange Commission on April 23, 1997 discusses some of the
important factors that could cause JP Foodservice, Inc.'s actual results to
differ materially from those in such forward-looking statements. Similarly,
Rykoff's SEC filings and reports describe important factors that could cause
Rykoff's actual results to differ materially from those in such forward-looking
statements.
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