UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. 2)
Rykoff-Sexton, Inc.
(Name of Issuer)
Common Stock, Par Value $.10 Per Share
(Title of Class of Securities)
783759103
(CUSIP Number)
David M. Abramson, Esq.
Senior Vice President and General Counsel
9830 Patuxent Woods Drive
Columbia, Maryland 21046
(410) 312-7100
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
June 30, 1997
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Sched-
ule 13G to report the acquisition which is the subject of this
Schedule 13D, and is filing this schedule because of Rule 13d--
1(b)(3) or (4), check the following box: [__]<PAGE>
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
JP Foodservice, Inc.
I.R.S. Identification No. 52-1634568
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [__]
(b) [__]
3. SEC USE ONLY
4. SOURCE OF FUNDS
WC, OO (See Item 3)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [__]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
WITH
7. SOLE VOTING POWER
5,564,140 shares (1) (See Item 5)
8. SHARED VOTING POWER
0
9. SOLE DISPOSITIVE POWER
5,564,140 shares (1) (See Item 5)
10. SHARED DISPOSITIVE POWER
0
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PER-
SON
5,564,140 shares (1) (See Item 5)
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [__]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
16.6% (2)
14. TYPE OF REPORTING PERSON
HC, CO
(1) The reporting person disclaims beneficial ownership
of all such shares pursuant to Rule 13d-4 under the Securities
Exchange Act of 1934, as amended (the "Act"). Beneficial own-
ership of such shares is being reported hereunder solely as a
result of the option (the "Option") granted pursuant to the
Rykoff Stock Option Agreement described in Item 4 hereof. JP
Foodservice, Inc. ("JP") expressly disclaims any beneficial
ownership of such shares of Rykoff Common Stock which are ob-
tainable by JP upon exercise of the Option because the Option
is exercisable only in the circumstances set forth in Item 4,
none of which has occurred as of the date hereof.
(2) Gives effect to the issuance of Rykoff Common Stock
subject to the Option.
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Item 1. Security and Issuer
This statement relates to shares of common stock, par
value $.10 per share (the "Rykoff Common Stock"), of Rykoff-
Sexton, Inc. ("Rykoff"). The address of Rykoff's principal
executive offices is 613 Baltimore Drive, Wilkes-Barre, Penn-
sylvania 18702.
Item 2. Identity and Background
(a) - (c) and (f). This Schedule 13D is being filed by
JP Foodservice, Inc., a corporation organized and existing un-
der the laws of the State of Delaware ("JP"). JP is a broad-
line distributor of food and related products to restaurants
and other institutional foodservice establishments primarily in
the Mid-Atlantic, Midwestern and Northeastern regions of the
United States. JP's principal business and offices are located
at 9830 Patuxent Woods Drive, Columbia, Maryland 21046.
Each executive officer and each director of JP is a citi-
zen of the United States. The name, business address, and
present principal occupation of each executive officer and di-
rector is set forth in Annex A to this Schedule 13D and spe-
cifically incorporated herein by reference.
Other than executive officers and directors, there are no
persons or corporations controlling or ultimately in control of
JP.
(d) - (e). During the last five years, neither JP nor, to
the best knowledge of JP, any executive officer or director of
JP, has been (i) convicted in a criminal proceeding (excluding
traffic violations and similar misdemeanors) or (ii) a party to
a civil proceeding of a judicial or administrative body of com-
petent jurisdiction and as a result of such proceeding has been
or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities
subject to, federal or state securities laws or finding any
violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
Pursuant to the Rykoff Stock Option Agreement described in
Item 4 (the "Rykoff Stock Option Agreement"), Rykoff has
granted to JP the Option to purchase up to 5,564,140 shares of
Rykoff Common Stock at a price of $25.305 per share, exercis-
able only upon the occurrence of certain events. The exercise
of the Option to purchase the full number of shares of Rykoff
Common Stock currently covered thereby would require aggregate
funds of approximately $140,800,563. If JP were to purchase
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shares of Rykoff Common Stock pursuant to the Rykoff Stock Op-
tion Agreement, JP currently anticipates that such funds would
be provided from JP's working capital and from borrowings from
other sources yet to be determined.
Item 4. Purpose of Transaction
On June 30, 1997, JP, Hudson Acquisition Corp., a Delaware
corporation and a wholly-owned subsidiary of JP ("Acquisi-
tion"), and Rykoff entered into an Agreement and Plan of Merger
(as amended, the "Merger Agreement"), pursuant to which Rykoff
will be merged with and into Acquisition (the "Merger"). On
September 3, 1997, the parties to the Merger Agreement entered
into Amendment No. 1 to ("Amendment No. 1"). On November 5,
1997, the parties to the Merger Agreement entered into Amend-
ment No. 2 to Agreement and Plan of Merger ("Amendment No. 2").
As a result of the Merger, each outstanding share of
Rykoff Common Stock (excluding treasury and certain other
shares) will be converted into 0.775 shares of common stock,
par value $.01 per share, of JP ("JP Common Stock"). Consumma-
tion of the Merger would result in the Rykoff Common Stock
ceasing to be listed on the New York Stock Exchange (the
"NYSE") and the termination of registration of such securities
pursuant to the Act.
The Merger will be a tax-free reorganization and will be
accounted for as a pooling of interests. The Merger is subject
to a number of conditions set forth in the Merger Agreement.
The Merger Agreement, as originally executed and delivered, is
included as Exhibit 1 hereto and is hereby incorporated herein
by reference. Amendment No. 1 is included as Exhibit 1.1
hereto and is hereby incorporated herein by reference. Amend-
ment No. 2 is included as Exhibit 1.2 hereto and is hereby in-
corporated herein by reference.
As a condition and inducement to JP's entering into the
Merger Agreement (and a reciprocal stock option agreement),
Rykoff entered into the Rykoff Stock Option Agreement with JP.
Pursuant to the Rykoff Stock Option Agreement, Rykoff has
granted to JP the Option to purchase up to 5,564,140 shares
(the "Option Shares") of Rykoff Common Stock at a price of
$25.305 per share, exercisable only upon the occurrence of cer-
tain events. The number of Option Shares is subject to adjust-
ment by reason of any stock dividend, stock split, recapital-
ization, merger, rights offering, share exchange or other
change in the corporate or capital structure of Rykoff. Under
certain circumstances set forth in the Rykoff Stock Option
Agreement, JP, as grantee of the Option, may surrender the Op-
tion to Rykoff in exchange for a formula payment based on the
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difference (reduced by the amount of any termination fee paid
by Rykoff to JP pursuant to the Merger Agreement) between (x)
the price paid to Rykoff or its stockholders in certain compet-
ing transactions involving the acquisition of Rykoff and (y)
the exercise price of the Option. The Rykoff Stock Option
Agreement is included as Exhibit 2 hereto and is hereby incor-
porated herein by reference.
Pursuant to the Merger Agreement, the directors and offic-
ers of Acquisition immediately prior to the consummation of the
Merger will be the initial directors and officers of Acquisi-
tion, the wholly-owned subsidiary of JP that will be the sur-
viving corporation in the Merger, each to hold office in ac-
cordance with the surviving corporation's certificate of incor-
poration and by-laws. The Merger Agreement also provides that
the Certificate of Incorporation and by-laws of Acquisition, as
in effect immediately prior to consummation of the Merger, will
be the Certificate of Incorporation and by-laws of such surviv-
ing corporation in the Merger, in each case until thereafter
amended in accordance with applicable law, except that (i) Ar-
ticle First of the Certificate of Incorporation of the surviv-
ing corporation shall be amended to provide that the name of
the surviving corporation shall be "Rykoff-Sexton, Inc." and
(ii) the Certificate of Incorporation and By-laws of the sur-
viving corporation will be amended to contain the provisions
with respect to indemnification set forth in the Certificate of
Incorporation of Rykoff and the Amended and Restated By-Laws of
Rykoff (in each case as in effect on, and provided to JP prior
to, June 30, 1997) which provisions will not be amended, re-
pealed or otherwise modified, except as required by law, for a
period of six years from the effective time of the Merger (the
"Effective Time") in any manner that would affect adversely the
rights thereunder of individuals who at the Effective Time are
or were directors or officers of Rykoff or its subsidiaries or
any of its predecessors.
Pursuant to the Merger Agreement, Rykoff has agreed, dur-
ing the period prior to the Effective Time, that neither it nor
its subsidiaries shall pay dividends except for semi-annual
cash dividends on Rykoff Common Stock not in excess of $0.03
per share and certain intercompany dividends.
Except as set forth in this Item 4, JP has no plans or
proposals which relate to or would result in any of the matters
set forth in clauses (a) through (j) of Item 4 of Schedule 13D.
The preceding summary of certain provisions of the Merger
Agreement, Amendment No. 1, Amendment No. 2 and the Rykoff
Stock Option Agreement, copies of which are filed or incorpo-
rated by reference as exhibits hereto, is not intended to be
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complete and is qualified in its entirety by reference to the
full text of such agreements.
Item 5. Interest in Securities of the Issuer
(a) and (b). Pursuant to the Rykoff Stock Option Agree-
ment, JP has the right, exercisable only in certain circum-
stances, none of which has occurred as of the date hereof, to
acquire up to 5,564,140 shares of Rykoff Common Stock (subject
to adjustment as described in Item 4), which represents benefi-
cial ownership of approximately 19.9% of the shares of Rykoff
Common Stock currently outstanding. If JP were to acquire such
shares, it would have sole voting and investment power with
respect thereto. Because of the limited circumstances in which
the option granted under the Rykoff Option Agreement is exer-
cisable, JP disclaims beneficial ownership of such shares of
Rykoff Common Stock subject to the Rykoff Stock Option Agree-
ment. In addition, in connection with the proposed merger, JP
has entered into a Support Agreement with certain stockholders
of Rykoff. See Item 6.
To the best of its knowledge, no executive officer or di-
rector of JP beneficially owns any shares of Rykoff Common
Stock.
(c) Except to the extent of transactions in a fiduciary
capacity, there have been no transactions in shares of Rykoff
Common Stock by JP, or, to the best knowledge of JP, any of
JP's executive officers and directors during the past 60 days.
(d) As described in Item 6, the ML Investors (as defined
in Item 6) may be deemed to be beneficial owners of shares of
Rykoff Common Stock and, subject to the Support Agreement de-
scribed therein, have the right to receive dividends and pro-
ceeds from the sale of such shares.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relation-
ships with Respect to Securities of the Issuer
On June 30, 1997, in connection with the execution of
the Merger Agreement, certain stockholders of Rykoff (the "ML
Investors"), holding in the aggregate approximately 36.4% of
the outstanding shares (the "ML Shares") of Rykoff Common Stock
as of such date, entered into a Support Agreement (as amended
and restated, the "Support Agreement"), dated as of June 30,
1997, with JP, and acknowledged by Rykoff. The ML Investors
are comprised of Merrill Lynch Capital Partners, Inc., Merrill
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Lynch Capital Appreciation Partnership No. B-XVIII, L.P., Mer-
rill Lynch KECALP L.P. 1994, ML Offshore LBO Partnership No. B-
XVIII, ML IBK Positions, Inc., MLCP Associates L.P. No. II,
MLCP Associates L.P. No. IV, Merrill Lynch KECALP L.P. 1991,
Merrill Lynch Capital Appreciation Partnership No. XIII, L.P.,
ML Offshore LBO Partnership No. XIII, ML Employees LBO Partner-
ship No. I, L.P., Merrill Lynch KECALP L.P. 1987 and Merchant
Banking L.P. No. II. Pursuant to the Support Agreement, each
ML Investor has agreed to vote all shares of Rykoff Common
Stock held by it for approval and adoption of the Merger Agree-
ment and the Merger at the meeting of the stockholders of
Rykoff to be called and held to consider such adoption and ap-
proval. In addition, the ML Investors have agreed not to take
certain actions during the term of the Support Agreement (or
certain periods thereof) relating to the disposition of the
businesses or assets of Rykoff or JP or their respective sub-
sidiaries, or the acquisition of the voting securities of
Rykoff or JP or their respective subsidiaries, or the merger or
consolidation of Rykoff or JP or any of their respective sub-
sidiaries with or into any corporation or other entity, other
than the Merger or related transactions. The Support Agreement
will terminate in the event that the Merger Agreement is termi-
nated in accordance with its terms.
JP disclaims beneficial ownership of the ML Shares.
The preceding summary of the Support Agreement is quali-
fied in its entirety by reference to the full text of such Sup-
port Agreement, which is included as Exhibit 3 hereto and is
hereby incorporated herein by reference.
A copy of the Rykoff Stock Option Agreement is in-
cluded as Exhibit 2 hereto and is incorporated herein by refer-
ence. The rights and obligations of Rykoff and JP under the
Rykoff Stock Option Agreement are subject to all required regu-
latory approvals.
A copy of the Merger Agreement is included as Exhibit
1 hereto, a copy of Amendment No. 1 is included as Exhibit 1.1
hereto and a copy of Amendment No. 2 is included as Exhibit 1.2
hereto, and each is incorporated herein by reference.
Except as set forth in Items 3, 4, 5 and 6, neither
JP nor, to the best knowledge of JP, any of its directors or
executive officers has any contracts, arrangements, understand-
ings or relationships (legal or otherwise) with any other per-
son with respect to any securities of Rykoff.
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Item 7. Materials to be Filed as Exhibits
1. Agreement and Plan of Merger, dated as of June 30,
1997, by and among JP Foodservice, Inc., Hudson Ac-
quisition Corp. and Rykoff-Sexton, Inc. (incorpo-
rated by reference to Exhibit 1 to the Schedule 13D
of JP Foodservice, Inc. filed on July 3, 1997).
1.1. Amendment No. 1 to Agreement and Plan of Merger,
dated as of September 3, 1997, by and among JP Food-
service, Inc., Hudson Acquisition Corp. and Rykoff-
Sexton, Inc. (incorporated by reference to Exhibit
1.1 to the Schedule 13D of JP Foodservice, Inc.
filed on September 9, 1997).
1.2. Amendment No. 2 to Agreement and Plan of Merger,
dated as of November 5, 1997, by and among JP Food-
service Inc., Hudson Acquisition Corp. and Rykoff-
Sexton, Inc.
2. Stock Option Agreement, dated as of June 30, 1997,
by and between Rykoff-Sexton, Inc., as issuer, and
JP Foodservice, Inc., as grantee (incorporated by
reference to Exhibit 2 to the Schedule 13D of JP
Foodservice filed July 3, 1997).
3. Amended and Restated Support Agreement, dated as of
June 30, 1997, by and between JP Foodservice, Inc.
on the one hand, and the stockholders of Rykoff-
Sexton, Inc. listed on the signature pages thereto,
on the other hand, and acknowledged by Rykoff-
Sexton, Inc. (incorporated by reference to Exhibit 3
to the Schedule 13D of JP Foodservice, Inc. filed on
September 9, 1997).
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SIGNATURE
After reasonable inquiry and to the best of its knowledge
and belief, the undersigned certifies that the information set
forth in this statement is true, complete and correct.
November 7, 1997
JP FOODSERVICE, INC.
/s/ David M. Abramson
David M. Abramson
Senior Vice President and
General Counsel
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ANNEX A
Identity and Background
The following table sets forth the names, addresses and
principal occupations of the executive officers and directors
of JP Foodservice, Inc. ("JP"). Except as set forth below, the
principal business address of each such director and executive
officer is the address of JP, 9830 Patuxent Woods Drive, Colum-
bia, Maryland 21046. Each of such directors and executive of-
ficers is a citizen of the United States.
DIRECTORS
Name and Business Address Present Principal Occupation or Employment
Lewis Hay, III Senior Vice President and Chief Financial
Officer, JP Foodservice, Inc.
Mark P. Kaiser Senior Vice President--Sales, Marketing
and Procurement, JP Foodservice, Inc.
Jeffrey D. Serkes Vice President and Treasurer,
Old Orchard Road International Business Machines
Armonk, NY 10604 Corporation
James L. Miller Chairman of the Board of Directors, Presi-
dent and Chief Executive Officer, JP Food-
service, Inc.
David M. Abramson Senior Vice President and General Counsel,
JP Foodservice, Inc.
Dean R. Silverman President, Dean & Company Strategy
Fairfax Square, Consultants, Inc.
Tysons Corner
8065 Leesburg Pike
Fifth Floor
Vienna, VA 22182
Michael J. Drabb Executive Vice President, O'Brien Asset
520 Broad Street Management, Inc.
Suite A07S
Newark, NJ 07102-3184
Eric E. Glass Chairman of the Board, The Taney
5130 Allendale Lane Corporation; Chairman of the Board,
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P.O. Box 29 Monocacy Bancshares, Inc.
Taneytown, MD 21757
Paul I. Latta Senior Vice President, Rouse Company
10275 Little Patuxent
Parkway
Columbia, Maryland 21044
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EXECUTIVE OFFICERS
Name and Business Address Present Principal Occupation or Employment
James L. Miller Chairman of the Board of Directors, Pres-
ident and Chief Executive Officer
Lewis Hay, III Senior Vice President and Chief Financial
Officer
Mark P. Kaiser Senior Vice President--Sales, Marketing
and Procurement
David M. Abramson Senior Vice President and General Counsel
George T. Megas Vice President--Finance
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Item 7. Materials to be Filed as Exhibits
1. Agreement and Plan of Merger, dated as of June 30,
1997, by and among JP Foodservice, Inc., Hudson Ac-
quisition Corp. and Rykoff-Sexton, Inc. (incorporated
by reference to Exhibit 1 to the Schedule 13D of JP
Foodservice, Inc. filed on July 3, 1997).
1.1. Amendment No. 1 to Agreement and Plan of Merger, dated
as of September 3, 1997, by and among JP Foodservice,
Inc., Hudson Acquisition Corp. and Rykoff-Sexton, Inc.
(incorporated by reference to Exhibit 1.1 to the
Schedule 13D of JP Foodservice, Inc. filed on
September 9, 1997).
1.2. Amendment No. 2 to Agreement and Plan of Merger, dated
as of November 5, 1997, by and among JP Foodservice
Inc., Hudson Acquisition Corp. and Rykoff-Sexton, Inc.
2. Stock Option Agreement, dated as of June 30, 1997, by
and between Rykoff-Sexton, Inc., as issuer, and JP
Foodservice, Inc., as grantee (incorporated by
reference to Exhibit 2 to the Schedule 13D of JP
Foodservice filed July 3, 1997).
3. Amended and Restated Support Agreement, dated as of
June 30, 1997, by and between JP Foodservice, Inc. on
the one hand, and the stockholders of Rykoff-Sexton,
Inc. listed on the signature pages thereto, on the
other hand, and acknowledged by Rykoff-Sexton, Inc.
(incorporated by reference to Exhibit 3 to the
Schedule 13D of JP Foodservice, Inc. filed on
September 9, 1997).
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EXHIBIT 1.2
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
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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, 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
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
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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"
-4-<PAGE>
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 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
-5-<PAGE>
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."
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
-6-<PAGE>
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.
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),"
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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 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
-8-<PAGE>
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 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
-9-<PAGE>
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.
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.
-10-<PAGE>
(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 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.]
-11-<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
-12-
