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As filed with the Securities and Exchange Commission on April 28, 1998
Registration No. 333-______
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
U.S. FOODSERVICE
(Exact name of registrant as specified in its charter)
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<S> <C>
DELAWARE 52-1634568
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
</TABLE>
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9830 PATUXENT WOODS DRIVE
COLUMBIA, MARYLAND 21046
(410) 312-7100
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
---------------
DAVID M. ABRAMSON
EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
U.S. FOODSERVICE
9830 PATUXENT WOODS DRIVE
COLUMBIA, MARYLAND 21046
(410) 312-7100
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
---------------
Copy to:
RICHARD J. PARRINO, ESQ.
HOGAN & HARTSON L.L.P.
555 THIRTEENTH STREET, N.W.
WASHINGTON, D.C. 20004
(202) 637-5600
---------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon
as practicable after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering: [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering: [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: [ ]
---------------
<PAGE>
CALCULATION OF REGISTRATION FEE
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<CAPTION>
==============================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM
OFFERING AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO BE PRICE PER OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED(1) SHARE(2) PRICE(2)(3) FEE(3)
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<S> <C> <C> <C> <C>
Common Stock, par value
$.01 per share 228,773 shares $36.81 $8,421,134.13 $2,484.23
==============================================================================================
</TABLE>
(1) Pursuant to Rule 429 under the Securities Act, 337,239 shares of Common
Stock are being carried forward from Registration Statement No. 333-41795.
The filing fee of $568.18 associated with such shares was previously paid
with such earlier Registration Statement.
(2) Estimated pursuant to Rule 457(c) under the Securities Act solely for the
purpose of calculating the registration fee.
(3) In accordance with Rule 457(c), the proposed maximum aggregate offering
price and registration fee are based upon the average of the high and low
prices for the Registrant's Common Stock on the New York Stock Exchange,
Inc. on April 21, 1998.
----------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH THE PROVISIONS OF
SECTION 8(A) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS
REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND
EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
<PAGE>
PROSPECTUS
- ----------
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF SUCH STATE.
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
566,012 SHARES
U.S. FOODSERVICE
COMMON STOCK
---------------
The 566,012 shares (the "Shares") of Common Stock, par value $.01 per share
(the "U.S. Foodservice Common Shares"), of U.S. Foodservice (the "Company" or
"U.S. Foodservice") offered hereby may be offered and sold from time to time by
the holders named herein or by their permitted transferees or successors
(collectively, the "Selling Stockholders") pursuant to this Prospectus, as it
may be appropriately amended or supplemented from time to time. See "Selling
Stockholders." The Company will not receive any of the proceeds from the sale of
the Shares by the Selling Stockholders.
The Shares may be offered or sold by the Selling Stockholders from time to
time directly to purchasers or through agents, underwriters, brokers or dealers
on terms to be determined at the time of sale. See "Plan of Distribution." If
required, the names of any such agents or underwriters involved in the sale of
the Shares in respect of which this Prospectus is being delivered and the
applicable agent's commission, dealer's purchase price or underwriter's
discount, if any, will be set forth in an accompanying supplement to this
Prospectus (a "Prospectus Supplement").
The Selling Stockholders and any broker-dealers, agents or underwriters
which participate in the distribution of the Shares may be deemed to be
"underwriters" within the meaning of the Securities Act of 1933, as amended (the
"Securities Act"), and any commission received by them or any profit received by
them on the resale of Shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act. See "Plan of Distribution."
The U.S. Foodservice Common Shares are listed on the New York Stock
Exchange, Inc. (the "NYSE") under the symbol "UFS." On April 21, 1998, the
last reported sale price of the U.S. Foodservice Common Shares on the NYSE was
$36.81 per share.
SEE "RISK FACTORS" BEGINNING ON PAGE 6 FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE U.S. FOODSERVICE
COMMON SHARES OFFERED HEREBY.
---------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
---------------
THE DATE OF THIS PROSPECTUS IS ________, 1998.
<PAGE>
No person is authorized in connection with any offering made hereby to
give any information or to make any representation not contained or incorporated
by reference in this Prospectus, and any information or representation not
contained or incorporated herein must not be relied upon as having been
authorized by the Company. This Prospectus does not constitute an offer to
sell, or a solicitation of an offer to buy, by any person in any jurisdiction in
which it is unlawful for such person to make such offer or solicitation.
Neither the delivery of this Prospectus or any sale made hereunder shall, under
any circumstances, create any implication that there has been no change in the
affairs of U.S. Foodservice since the date hereof or that the information in
this Prospectus or in the documents incorporated by reference herein is correct
as of any time subsequent to the date hereof or thereof.
TABLE OF CONTENTS
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Available Information............................ 3
Incorporation of Certain Documents by Reference.. 3
Forward-Looking Statements....................... 4
The Company...................................... 5
Risk Factors..................................... 6
Dividend Policy.................................. 13
Use of Proceeds.................................. 13
Selling Stockholders............................. 14
Plan of Distribution............................. 15
Legal Matters.................................... 16
Experts.......................................... 16
</TABLE>
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AVAILABLE INFORMATION
This Prospectus, which constitutes a part of a Registration Statement on
Form S-3 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") filed by the Company with the Securities and Exchange
Commission (the "Commission") under the Securities Act, omits certain of the
information set forth in the Registration Statement in accordance with the rules
and regulations of the Commission. Reference is hereby made to the Registration
Statement and to the exhibits thereto for further information with respect to
the Company and the securities offered hereby. Copies of the Registration
Statement and the exhibits thereto are on file at the offices of the Commission
and may be obtained upon payment of the prescribed fee or may be examined
without charge at the public reference facilities of the Commission described
below.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Commission. Such reports, proxy statements and other information filed by the
Company with the Commission may be inspected and copied at the public reference
facility maintained by the Commission at Judiciary Plaza, 450 Fifth Street,
N.W., Room 1024, Washington, D.C. 20549, and the following regional offices of
the Commission: New York Regional Office, Seven World Trade Center, 13th Floor,
New York, New York 10048; and Chicago Regional Office, Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such material
also may be obtained from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. The Commission
also maintains a Web site (http://www.sec.gov) that contains reports, proxy and
information statements and other information regarding registrants such as the
Company which file electronically with the Commission. The U.S. Foodservice
Common Shares are listed on the NYSE and reports, proxy statements and other
information concerning the Company may be inspected at the offices of the NYSE,
20 Broad Street, New York, New York 10005.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents or portions of documents filed by the Company
with the Commission pursuant to the Exchange Act are incorporated herein by
reference:
(a) the Company's Annual Report on Form 10-K for the fiscal year
ended June 28, 1997, as amended by Form 10-K/A-1 filed on October 24, 1997;
(b) the Company's Quarterly Reports on Form 10-Q for the fiscal
quarters ended September 27, 1997 and December 27, 1997;
(c) the Company's Current Reports on Form 8-K filed on July 2, 1997,
September 9, 1997, November 7, 1997, November 26, 1997, January 7, 1998, as
amended by Form 8-K/A-1 filed on March 9, 1998, January 29, 1998, February 25,
1998 and March 2, 1998;
(d) the description of the U.S. Foodservice Common Shares which is
contained in the Company's Registration Statement on Form 8-A filed pursuant to
the Exchange Act on December 20, 1996, including any amendments or reports filed
for the purpose of updating such description; and
(e) the description of the preferred share purchase rights attached
to the U.S. Foodservice Common Shares which is contained in the Company's
Registration Statement on Form 8-A filed pursuant to the Exchange Act on
December 20, 1996, including any amendments or reports filed for the purpose of
updating such description.
All documents subsequently filed by the Company pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent to the
effective date of the Registration Statement of which this Prospectus
constitutes a part and prior to the termination of this offering shall be deemed
to be incorporated by reference into this Prospectus and to be a part hereof
from the date of filing of such documents.
In addition, any statement contained in a document incorporated or
deemed to be incorporated by reference herein will be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein or any other subsequently filed document which also is or is
deemed to be incorporated into this Prospectus modifies or supersedes that
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus.
The Company will provide to each person to whom this Prospectus is
delivered, without charge and upon written or oral request, a copy of any or all
of such documents which are incorporated herein by reference (other than
exhibits to such documents unless such exhibits are specifically incorporated by
reference into the documents that this Prospectus incorporates). Requests for
copies of such documents should be directed to Corporate Secretary, U.S.
Foodservice, at the Company's principal executive offices located at 9830
Patuxent Woods Drive, Columbia, Maryland 21046, telephone number (410) 312-7100.
3
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FORWARD-LOOKING STATEMENTS
THIS PROSPECTUS, INCLUDING ANY DOCUMENTS THAT ARE INCORPORATED BY
REFERENCE HEREIN AS SET FORTH IN "INCORPORATION OF CERTAIN DOCUMENTS BY
REFERENCE," INCLUDES FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION
27A OF THE SECURITIES ACT AND SECTION 21E OF THE EXCHANGE ACT. ALL STATEMENTS
REGARDING U.S. FOODSERVICE, RYKOFF-SEXTON, INC. OR THE COMBINED COMPANY'S
EXPECTED FUTURE FINANCIAL POSITION, BUSINESS STRATEGY, COST SAVINGS AND
OPERATING SYNERGIES, PROJECTED COSTS AND PLANS, AND OBJECTIVES OF MANAGEMENT FOR
FUTURE OPERATIONS ARE FORWARD-LOOKING STATEMENTS. ALTHOUGH U.S. FOODSERVICE
BELIEVES THE EXPECTATIONS REFLECTED IN SUCH FORWARD-LOOKING STATEMENTS ARE BASED
ON REASONABLE ASSUMPTIONS, NO ASSURANCE CAN BE GIVEN THAT SUCH EXPECTATIONS WILL
PROVE TO HAVE BEEN CORRECT. IMPORTANT FACTORS THAT COULD CAUSE ACTUAL RESULTS TO
DIFFER MATERIALLY FROM THE EXPECTATIONS REFLECTED IN THE FORWARD-LOOKING
STATEMENTS HEREIN INCLUDE, AMONG OTHERS, THE FACTORS SET FORTH UNDER THE CAPTION
"RISK FACTORS," GENERAL ECONOMIC AND BUSINESS AND MARKET CONDITIONS, CHANGES IN
FEDERAL LAWS, DIFFICULTIES IN ACHIEVING EXPECTED COST SAVINGS AND OPERATING
SYNERGIES FROM THE MERGER DESCRIBED HEREIN, INCREASED COMPETITIVE PRESSURE IN
THE COMBINED COMPANY'S INDUSTRY, AND COSTS OR DIFFICULTIES RELATING TO THE
INTEGRATION OF THE BUSINESSES OF U.S. FOODSERVICE AND RYKOFF-SEXTON, INC.
4
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THE COMPANY
GENERAL
As a result of the Merger described below, the Company, which conducts
operations as U.S. Foodservice, is the nation's second largest broadline
foodservice distributor based on fiscal 1997 sales of approximately $5.2
billion. Broadline distributors offer a comprehensive range of food and related
products from a single source of supply and provide foodservice establishments
with the cost savings associated with large, full-service deliveries. Operating
from over 35 full-service distribution centers nationwide, the Company offers
its products and services across a broad geographic area encompassing more than
85% of the U.S. population.
The Company markets and distributes more than 40,000 national, private
label and signature brand items to over 130,000 foodservice customers, including
restaurants, hotels, health care facilities, cafeterias and schools. The
Company's diverse customer base encompasses both independent (or "street") and
multi-unit (or "chain") businesses, including Old Country Buffet, Perkins Family
Restaurants, Subway, Eurest Dining Services, Cheesecake Factory, Kindercare,
Pizzeria Uno and Ruby Tuesday. The Company's comprehensive product line includes
canned and dry food products, fresh meats, poultry, seafood, specialty and
gourmet imported products, frozen foods, fresh produce, dairy and other
refrigerated products, paper products, cleaning supplies, light restaurant
equipment and other supplies. This broad product line provides the Company's
customers with a single source to satisfy substantially all of their foodservice
needs.
The Company also provides restaurant design and engineering services
for all types of foodservice operations through its contract/design offices and
manufactures products primarily under its proprietary private labels.
As of December 27, 1997, the end of its second quarter in fiscal 1998,
the Company had over 12,000 full-time employees.
The Company supplements its internal expansion with an active program
of strategic acquisitions to take advantage of growth opportunities from ongoing
consolidation in the fragmented foodservice distribution industry. The Company
seeks to increase penetration of its existing markets through "fold-in"
acquisitions of small, privately-owned distributors within its current markets
and to expand into new markets through acquisitions of larger-sized
distributors. The Company's ability to compete for acquisition opportunities
with other foodservice businesses is enhanced by its financial resources, which
include access to the public capital markets.
Effective February 27, 1998, the Company changed its corporate name
from JP Foodservice, Inc. to U.S. Foodservice. The references in this Prospectus
to U.S. Foodservice prior to February 27, 1998 are to JP Foodservice, Inc.
The principal executive offices of U.S. Foodservice are located at
9830 Patuxent Woods Drive, Columbia, Maryland 21046, and U.S. Foodservice's
telephone number is (410) 312-7100.
Unless the context otherwise requires, references in this Prospectus
to the Company or U.S. Foodservice are to U.S. Foodservice and its consolidated
subsidiaries.
MERGER
Effective December 23, 1997, the Company acquired by merger (the
"Merger") Rykoff-Sexton, Inc. ("Rykoff-Sexton"), the nation's third largest
broadline foodservice distributor. In the transaction, Rykoff-Sexton merged with
and into a wholly-owned subsidiary of the Company ("Merger Sub") pursuant to an
Agreement and Plan of Merger, dated as of June 30, 1997, as amended (the "Merger
Agreement"), among Rykoff-Sexton, Merger Sub and the Company. Merger Sub,
formerly known as Hudson Acquisition Corp., was the surviving corporation in the
Merger, was renamed Rykoff-Sexton, Inc. as of the effective time of the Merger
(the "Effective Time") and will continue to be a wholly-owned subsidiary of the
Company.
At the Effective Time, each issued and outstanding share of Common
Stock, par value $.10 per share, of Rykoff-Sexton (the "Rykoff-Sexton Common
Shares") (other than Rykoff-Sexton Common Shares, if any, owned by the Company,
Merger Sub or Rykoff-Sexton, which were canceled) was converted into the right
to receive 0.775 of a U.S. Foodservice Common Share. In connection with the
Merger, holders of Rykoff-Sexton Common Shares immediately before the Merger
received U.S. Foodservice Common Shares representing approximately 50% of the
U.S. Foodservice Common Shares outstanding giving effect to the Merger. Entities
(the "ML Investors") holding Rykoff-Sexton Common Shares immediately before the
Merger who are affiliated with Merrill Lynch, Pierce, Fenner & Smith
Incorporated, an international investment banking and advisory firm, received
U.S. Foodservice Common Shares representing approximately 17% of the U.S.
Foodservice Common Shares outstanding giving effect to the Merger.
U.S. Foodservice has accounted for the Merger as a pooling of
interests in accordance with generally accepted accounting principles. The
Merger constituted a "reorganization" within the meaning of Section 368(a) of
the Internal Revenue Code of 1986, as amended.
Effective as of April 2, 1998, the corporate name of Merger Sub was
changed from Rykoff-Sexton, Inc. to U.S. Foodservice, Inc.
NEW CREDIT FACILITY
In connection with the Merger, immediately following the Effective
Time, the Company entered into a new revolving credit facility and a new 364-day
revolver/term loan facility (collectively, the "New Credit Facility") with a
syndicate of banks which will provide the Company with funding of up to $750
million. A portion of such funds was applied to refinance indebtedness of U.S.
Foodservice and Rykoff-Sexton outstanding at the Effective Time under their
former senior bank credit facilities and to prepay U.S. Foodservice's 8.55%
Senior Notes due 2004. The Company will use other borrowings under the New
Credit Facility to pay fees and expenses incurred in connection with the Merger
and to finance capital expenditures and other on-going capital needs.
5
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RISK FACTORS
In addition to the other information contained in this Prospectus,
prospective investors should consider carefully the following risk factors
relating to the Company and the U.S. Foodservice Common Shares before making an
investment in the Shares offered hereby.
UNCERTAINTIES IN INTEGRATING BUSINESS OPERATIONS AND ACHIEVING COST SAVINGS
In determining that the Merger was in the best interests of its
stockholders, the U.S. Foodservice Board of Directors considered the cost
savings, operating efficiencies and other synergies expected to result from the
integration of the U.S. Foodservice and Rykoff-Sexton businesses. The
managements of U.S. Foodservice and Rykoff-Sexton have estimated that the
combination of U.S. Foodservice and Rykoff-Sexton could create opportunities for
operating cost savings of approximately $14 million during the first twelve-
month period following the effective time of the Merger, $20 million during the
second twelve-month period following the effective time of the Merger and $30
million annually thereafter. These cost savings are expected to be realized
primarily through the restructuring of operations.
The foregoing cost savings estimates were developed by U.S.
Foodservice and Rykoff-Sexton solely for purposes of evaluating whether or not
to proceed with the Merger, do not include non-recurring adjustments that will
be recorded in conjunction with the Merger, and should not be relied upon as an
estimate of the actual cost savings that may be achieved. These estimates are
based upon assumptions and operating synergies that are inherently uncertain,
though considered reasonable by U.S. Foodservice and Rykoff-Sexton, and are
subject to significant business, economic and competitive uncertainties which
are difficult to predict and often beyond the control of management. Several of
the cost savings estimates are premised on the assumption that certain levels of
efficiency maintained by either U.S. Foodservice or Rykoff-Sexton prior to the
Merger
6
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can be achieved by U.S. Foodservice following the Merger. Other estimates are
based on management's opinion as to what levels of enhanced purchasing leverage
and operating efficiencies should be achievable by an entity the size of the
combined entity.
The consolidation of functions, the integration of operations,
systems, marketing methods and procedures and the relocation of staff present
significant management challenges. There can be no assurance that such actions
will be accomplished successfully or as rapidly as currently expected. Moreover,
although the primary purpose of such actions will be to realize direct cost
savings and other operating efficiencies, there can be no assurance of the
extent to which such cost savings and efficiencies will be achieved or that
unforeseen costs and expenses or other factors will not offset the projected
cost savings in whole or in part. To the extent management of the combined
company is unable to integrate successfully the operations of the combined
company, such cost savings and efficiencies are not otherwise achieved or
achieved on a timely basis, or unforeseen costs and expenses or other factors
arise that offset cost savings, U.S. Foodservice's operating results would be
negatively affected.
EFFECT OF SIGNIFICANT INDEBTEDNESS ON RESULTS OF OPERATIONS AND FINANCIAL
CONDITION OF COMBINED COMPANY
Following the Merger, U.S. Foodservice has significant indebtedness
and debt service obligations. At December 27, 1997, the Company's total
indebtedness (excluding current maturities) was approximately $754 million. U.S.
Foodservice may incur additional indebtedness in the future, subject to certain
limitations contained in the instruments governing its indebtedness. The New
Credit Facility is expected to provide for lower borrowing costs than the
overall borrowing costs available under the former senior bank credit facilities
of U.S. Foodservice and Rykoff-Sexton.
Based upon the current level of operations and anticipated cost
savings, U.S. Foodservice believes that after the Merger its cash flow from
operations, together with borrowings under the New Credit Facility and its other
sources of liquidity, will be adequate to meet its anticipated requirements for
working capital, capital expenditures and debt service over the next several
years. There can be no assurance, however, that the combined company's business
will continue to generate cash flow at or above the cash flow levels attained by
U.S. Foodservice and Rykoff-Sexton in the aggregate or that anticipated cost
savings can be fully achieved. The failure of U.S.
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Foodservice to generate sufficient cash flow from operations in the future could
have a material adverse effect on the results of operations and financial
condition of the combined company. If U.S. Foodservice is unable to generate
sufficient cash flow from operations in the future to service its debt and make
necessary capital expenditures, U.S. Foodservice may be required to refinance
all or a portion of its debt, sell assets or obtain additional financing. There
can be no assurance as to whether, or the terms on which, any such refinancing
or asset sales would be consummated or any additional financing could be
obtained.
SHARES ELIGIBLE FOR FUTURE SALE
Immediately following the Merger, the ML Investors beneficially owned
approximately 17% of the outstanding U.S. Foodservice Common Shares. The ML
Investors may not sell the U.S. Foodservice Common Shares issued to them in the
Merger except pursuant to an effective registration statement under the
Securities Act covering such sale or in compliance with Rule 145 promulgated
under the Securities Act or another applicable exemption from the registration
requirements of the Securities Act. The ML Investors have the right, pursuant to
a registration rights agreement assumed by the Company in the Merger, to require
U.S. Foodservice, for a specified period and subject to certain limitations and
qualifications, to effect the registration under the Securities Act of the sale
of the U.S. Foodservice Common Shares issued to them in the Merger in exchange
for the Rykoff-Sexton Common Shares formerly entitled to the benefits of such
agreement. This group of shareholders and other parties also have "piggyback"
registration rights under such agreement with respect to the U.S. Foodservice
Common Shares
8
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issued to them in the Merger. The holders of certain Rykoff-Sexton common stock
purchase warrants assumed by the Company in the Merger and converted into
warrants to purchase U.S. Foodservice Common Shares are entitled to certain
"demand" and "piggyback" registration rights with respect to the U.S.
Foodservice Common Shares issued or issuable upon exercise of such new warrants.
In addition, U.S. Foodservice has previously granted certain "shelf"
and "piggyback" registration rights with respect to U.S. Foodservice Common
Shares issued in connection with the acquisition of other foodservice
businesses. Such registration rights are subject to certain notice requirements,
timing restrictions and volume limitations which may be imposed by the
underwriters of an offering in which such persons are participants.
No predictions can be made as to the effect, if any, that market sales
of U.S. Foodservice Common Shares by stockholders pursuant to such registration
rights, or the availability of such shares for such future sales, will have on
the market price of U.S. Foodservice Common Shares prevailing from time to time.
Sales of substantial amounts of U.S. Foodservice Common Shares, or the
perception that such sales could occur, could adversely affect prevailing market
prices for the U.S. Foodservice Common Shares and could impair U.S.
Foodservice's future ability to raise capital through an offering of its equity
securities.
POTENTIAL INFLUENCE BY AND RELATIONSHIP WITH ML INVESTORS
Immediately following the Merger, the 17% of outstanding U.S.
Foodservice Common Shares beneficially owned by the ML Investors is the largest
percentage of such shares beneficially owned by any person or group.
Pursuant to the Merger Agreement, the ML Investors have designated two
members of the U.S. Foodservice Board of Directors. In addition, pursuant to a
standstill agreement which was originally entered into with Rykoff-Sexton and
which is for the benefit of U.S. Foodservice after the merger (the "Standstill
Agreement"), the ML Investors have agreed to vote the U.S. Foodservice Common
Shares and other voting securities owned by them and their affiliates for U.S.
Foodservice's nominees to the Board of Directors, in accordance with the
recommendation of the Nominating Committee of the Board of Directors, subject to
certain exceptions. The ML Investors also have agreed that neither they nor any
of their affiliates will (subject to certain exceptions) participate in proxy
solicitations, acquire additional U.S. Foodservice Common Shares or otherwise
engage in transactions, or take actions involving a change of control of U.S.
Foodservice. The U.S. Foodservice Common Shares and other voting securities
owned by the ML Investors are subject to certain restrictions on sale or
transfer. The ML Investors are prohibited from soliciting, offering, seeking to
effect and negotiating with any person with respect to sales or transfers of
U.S. Foodservice Common Shares and other voting securities held by the ML
Investors unless otherwise permitted by the Standstill Agreement.
The U.S. Foodservice Common Shares received by the ML Investors in the
Merger will constitute a significant block of the voting power of the U.S.
Foodservice Common Shares. The voting of such shares as
9
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required by the Standstill Agreement will make it easier for the Board of
Directors to obtain the approval of U.S. Foodservice stockholders for the
election of U.S. Foodservice's nominees to the Board of Directors. Such a voting
block also could facilitate or impede the approval of any other matter requiring
approval of U.S. Foodservice stockholders, including a merger, consolidation or
other business combination involving U.S. Foodservice, or discourage a potential
acquiror from making a tender offer or otherwise attempting to obtain control of
U.S. Foodservice.
FACTORS RELATING TO FUTURE ACQUISITIONS
U.S. Foodservice's growth strategy emphasizes supplementing internal
expansion with acquisitions, and a significant portion of the growth of U.S.
Foodservice's revenues in fiscal year 1997 resulted from acquisitions. There can
be no assurance that U.S. Foodservice will successfully identify suitable
acquisition candidates, complete acquisitions, integrate acquired operations
into its existing operations or expand into new markets in the future. Further,
there can be no assurance that acquisitions will not have an adverse effect upon
U.S. Foodservice's operating results, particularly in periods following the
consummation of such transactions, during which the operations of the acquired
businesses are being integrated into U.S. Foodservice's operations. Once
integrated, acquired operations may not achieve levels of net sales or
profitability comparable to those achieved by U.S. Foodservice's existing
operations, or otherwise perform as expected. There can be no assurance that
U.S. Foodservice will be able to increase its revenues or earnings through
future acquisitions at the same rates it achieved through the acquisitions it
completed in fiscal 1997. Management may determine that it is necessary or
desirable to obtain financing for such acquisitions through additional bank
borrowings or the issuance of additional debt or equity securities. Debt
financing of any such acquisition could increase the leverage of U.S.
Foodservice and will be subject to restrictions contained in the New Credit
Facility, the indenture pursuant to which approximately $130 million principal
amount of 8 7/8% Senior Subordinated Notes due 2003 are outstanding (the
"Indenture") and other agreements relating to U.S. Foodservice's indebtedness.
Equity financing of any such acquisition may dilute the ownership of U.S.
Foodservice's stockholders. There can be no assurance that U.S. Foodservice will
be able to obtain financing on acceptable terms.
LOW MARGIN BUSINESS; ECONOMIC SENSITIVITY
The foodservice distribution industry is characterized by relatively
high inventory turnover with relatively low profit margins. A significant
portion of the Company's sales are made at prices that are based on product cost
plus a percentage markup. As a result, the Company's profit levels may be
negatively affected during periods of food price deflation, even though the
Company's gross profit percentage may remain relatively constant.
The foodservice industry is sensitive to national and regional
economic conditions, and the demand for foodservice products supplied by the
Company has been adversely affected in past years by economic downturns. The
Company's operating results also are particularly sensitive
10
<PAGE>
to, and may be adversely affected by, difficulties with the collectability of
accounts receivable, inventory control, competitive price pressures, severe
weather conditions and unexpected increases in fuel or other transportation-
related costs. Although these factors generally have not had a material adverse
impact on the Company's past operations, there can be no assurance that one or
more of such factors will not adversely affect future operating results.
COMPETITION
The Company operates in highly competitive markets, and its future
success will depend in large part on its ability to provide superior service and
high-quality products at competitive prices. The Company encounters competition
from a variety of sources, including specialty and system foodservice
distributors and other broadline distributors. Some of the Company's
competitors have substantially greater financial and other resources than the
Company.
DEPENDENCE ON SENIOR MANAGEMENT
The Company's success is largely dependent on the skills, experience
and efforts of its senior management. The loss of the services of one or more
of the Company's senior management could have a material adverse effect on the
Company's business and development. To date, the Company generally has been
successful in retaining the services of its senior management.
PROVISIONS WITH POSSIBLE ANTI-TAKEOVER EFFECTS
The Company's Certificate of Incorporation and By-Laws contain
provisions that may have the effect of discouraging certain transactions
involving an actual or threatened change of control of the Company. These
provisions include a requirement that the Board of Directors be divided into
three classes with approximately one-third of the Board to be elected each year.
The classification of directors has the effect of making it more difficult for
stockholders to change the composition of the Board. In addition, the Board of
Directors of the Company has the authority to issue up to 5,000,000 shares of
preferred stock in one or more series and to fix the powers, preferences and
rights of any such series without stockholder approval. The ability to issue
preferred stock could have the effect of discouraging unsolicited acquisition
proposals or making it more difficult for a third party to gain control of the
Company, or otherwise could adversely affect the market price of the Common
Stock. In February 1996, the Company adopted a shareholder rights plan under
which preferred share purchase rights, which are attached to the U.S.
Foodservice Common Shares, generally will be triggered upon the acquisition (or
certain actions that would result in the acquisition) of 10% or more of the U.S.
Foodservice Common Shares by any person or group. Investors eligible to report
their ownership of the U.S. Foodservice Common Shares on Schedule 13G under the
Exchange Act generally may acquire up to 15% of the U.S. Foodservice Common
Shares without triggering such rights.
11
<PAGE>
VOLATILITY OF MARKET PRICE FOR U.S. FOODSERVICE COMMON SHARES
From time to time, there may be significant volatility in the market
price for the U.S. Foodservice Common Shares. Quarterly operating results of the
Company or other distributors of food and related goods, changes in general
conditions in the economy, the financial markets or the food distribution or
foodservice industries, announcement of proposed acquisitions and failure to
complete announced acquisitions, unusual weather conditions or other
developments affecting the Company or its competitors could cause the market
price of the U.S. Foodservice Common Shares to fluctuate substantially. In
addition, in recent years the stock market has experienced extreme price and
volume fluctuations. This volatility has had a significant effect on the market
prices of securities issued by many companies for reasons unrelated to their
operating performance.
12
<PAGE>
DIVIDEND POLICY
U.S. Foodservice has never paid cash dividends on the U.S. Foodservice
Common Shares and does not anticipate declaring or paying cash dividends for the
foreseeable future. Financial covenants and other restrictions contained in the
New Credit Facility and the Indenture require U.S. Foodservice to meet certain
financial tests, and such agreements may restrict its ability to pay cash
dividends.
USE OF PROCEEDS
All of the Shares offered hereby are being sold by the Selling
Stockholders. The Company will not receive any of the proceeds from the sale of
the Shares. The Company will pay certain expenses relating to this offering,
estimated to be approximately $________. See "Selling Stockholders."
13
<PAGE>
SELLING STOCKHOLDERS
The following table sets forth certain information with respect to the
Selling Stockholders, including the name of each Selling Stockholder and the
number of Shares being offered hereby by each Selling Stockholder. None of the
Selling Stockholders owns U.S. Foodservice Common Shares prior to this offering
that represent, or will own U.S. Foodservice Common Shares after this offering
that will represent, one percent or more of the outstanding U.S. Foodservice
Common Shares. The information in the following table is as of February 10,
1998, except with respect to Richard Hafdal, Gary Hafdal, Frank Roedl, Rod Buck,
Sharon Robbins and B. Scott Ball (collectively, the "Westlund Provisions Selling
Stockholders"), as to whom the information is as of April 15, 1998.
The Selling Stockholders (other than The John S. Beuchat Living Trust
and the Westlund Provisions Selling Stockholders) include former stockholders of
the Mazo-Lerch Company ("Mazo-Lerch") and their permitted transferees and
successors (collectively, the "Mazo-Lerch Selling Stockholders"). The Company
issued 279,268 of the Shares offered hereby to the Mazo-Lerch Selling
Stockholders in consideration for its acquisition of Mazo-Lerch in the fourth
quarter of fiscal 1997. The Company issued 57,971 of the Shares offered hereby
to The John S. Beuchat Living Trust in consideration for its acquisition of
Outwest Meat Company in the fourth quarter of fiscal 1997.
The Westlund Provisions Selling Stockholders are former stockholders
of Westlund Provisions, Inc. ("Westlund Provisions") and their permitted
transferees and successors. The Company issued 228,773 of the Shares offered
hereby to the Westlund Provisions Selling Stockholders in consideration for the
Company's acquisition of Westlund Provisions in the third quarter of fiscal
1998.
<TABLE>
<CAPTION>
NAME OF SHARES BENEFICIALLY SHARES SHARES BENEFICIALLY
BENEFICIAL OWNER OWNED PRIOR TO OFFERING OFFERED OWNED AFTER OFFERING
-------------------- ------------------------- ------- --------------------
<S> <C> <C> <C>
The John Beuchat Living Trust 335,626 57,971 277,655
Julie Ann Bryant 5,060 5,060 0
Marshelle Elaine Burgess 5,060 5,060 0
Joanne Marie Burns 5,060 5,060 0
Alan David Lerch 5,060 5,060 0
Alida Ann Lerch 5,700 5,700 0
Diana Susan Lerch 5,700 5,700 0
Edna L. Lerch 5,818 5,818 0
Gary D. Lerch 15,809 15,809 0
Howard D. Lerch 2,009 2,009 0
Howard D. Lerch, Jr., Trustee 52,941 52,941 0
The Howard D. Lerch, Jr.
Revocable Trust
J.J. Bernard Lerch, III 16,186 16,186 0
Katherine Lee Lerch 9,685 9,685 0
Linda Kathleen Lerch 5,700 5,700 0
Robert J. Lerch 42,996 42,996 0
Robert J. Lerch, Custodian 9,685 9,685 0
for Christine Lorraine Lerch
Ryan Walter Lerch 9,685 9,685 0
William N. Lerch, Sr. 56,874 56,874 0
William Nelson Lerch, Jr. 5,060 5,060 0
Alice Payne, Trustee 5,060 5,060 0
The David Henry Payne Trust
Jennifer C. Payne 5,060 5,060 0
Nancy Lynn Payne 5,060 5,060 0
Richard Hafdal 167,625 167,625 0
Gary Hafdal 13,601 13,601 0
Frank Roedl 24,712 24,712 0
Rod Buck 12,116 12,116 0
Sharon Robbins 3,296 3,296 0
B. Scott Ball 7,423 7,423 0
</TABLE>
Robert J. Lerch served as the President of Mazo-Lerch prior to the
time it was acquired by the Company and Howard D. Lerch and William N. Lerch and
J.J. Bernard Lerch served as Vice Presidents. Each of the foregoing persons is
presently employed as a branch-level manager by the Company.
John S. Beuchat served as the President of Outwest Meat Company prior
to the time it was acquired by the Company and he continues to serve Outwest
Meat Company in that capacity.
<PAGE>
The Company leases certain facilities from the Lerch Brothers
Corporation, a corporation which is owned by certain of the Mazo-Lerch Selling
Stockholders. The Company pays aggregate annual lease payments of approximately
$400,000 to the Lerch Brothers Corporation in respect of these facilities. In
connection with the Mazo-Lerch acquisition, the Company also agreed to issue the
Mazo-Lerch Selling Stockholders additional U.S. Foodservice Common Shares if
the Company sells a parcel of real estate it acquired in the transaction to an
unaffiliated third party at a price above a certain level. In no event will the
Company be required to issue U.S. Foodservice Common Shares valued at more than
$3.0 million in the aggregate to the Mazo-Lerch Selling Stockholders in
connection with that transaction.
Prior to the acquisition of Westlund Provisions by U.S. Foodservice,
Richard Hafdal served as a director and Chief Executive Officer of Westlund
Provisions, Gary Hafdal served as a director, President and Chief Operating
Officer of Westlund Provisions and Frank Roedl served as the Chief Financial
Officer/Treasurer of Westlund Provisions. Each of the foregoing persons is
presently employed as a branch-level manager by the Company.
The Shares have been registered under the Securities Act and are being
offered hereby pursuant to registration rights granted by the Company to the
Selling Stockholders in connection with its acquisition of Mazo-Lerch, Outwest
Meat Company and Westlund Provisions. Under its registration rights agreements
with the Selling Stockholders, the Company is required to bear the expenses
relating to this offering, excluding any underwriting discounts or commissions,
stock transfer taxes and fees of legal counsel to the Selling Stockholders.
14
<PAGE>
PLAN OF DISTRIBUTION
All or part of the Shares may be offered by the Selling Stockholders
from time to time in transactions on the NYSE or any other market on which the
U.S. Foodservice Common Shares may be traded, in privately negotiated
transactions, through the writing of options on the Shares or a combination of
such methods of sale, at fixed prices that may be changed, at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices or at negotiated prices. The methods by which the Shares may be sold or
distributed may include, but not be limited to, the following: (i) a cross or
block trade in which the broker or dealer so engaged will attempt to sell the
Shares as agent, but may position and resell a portion of the block as principal
to facilitate the transaction; (ii) purchases by a broker or dealer as principal
and resale by such broker or dealer for its account; (iii) an exchange
distribution in accordance with the rules of such exchange; (iv) ordinary
brokerage transactions and transactions in which the broker solicits purchasers;
(v) privately negotiated transactions; (vi) short sales or borrowings, returns
and reborrowings of the Shares pursuant to stock loan agreements to settle short
sales; (vii) delivery in connection with the issuance of securities by issuers,
other than the Company, that are exchangeable for (whether optional or
mandatory), or payable in, such Shares (whether such securities are listed on a
national securities exchange or otherwise) or pursuant to which such Shares may
be distributed; and (viii) a combination of any such methods of sale or
distribution. In effecting sales, brokers or dealers engaged by the Selling
Stockholders may arrange for other brokers or dealers to participate. Brokers or
dealers may receive commissions or discounts from the Selling Stockholders or
from the purchasers in amounts to be negotiated immediately prior to or
following the sale. The Selling Stockholders also may sell such shares in
accordance with Rule 144 under the Securities Act.
If Shares are sold in an underwritten offering, the Shares may be
acquired by the underwriters for their own account and may be further resold
from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. The names of the underwriters with respect to any such
offering and the terms of the transactions, including any underwriting
discounts, concessions or
15
<PAGE>
commissions and other items constituting compensation of the underwriters and
broker-dealers, if any, will be set forth in a Prospectus Supplement relating to
such offering. Any public offering price and any discounts, concessions or
commissions allowed or reallowed or paid to broker-dealers may be changed from
time to time. Unless otherwise set forth in a Prospectus Supplement, the
obligations of the underwriters to purchase the Shares will be subject to
certain conditions precedent and the underwriters will be obligated to purchase
all the Shares specified in such Prospectus Supplement if any such Shares are
purchased.
This Prospectus also may be used by permitted donees, transferees and
successors in interest of the Selling Stockholders or by other persons acquiring
Shares, including brokers who borrow the Shares to settle short sales of the
U.S. Foodservice Common Shares, and who wish to offer and sell such Shares under
circumstances requiring or making desirable its use.
From time to time the Selling Stockholders may engage in short sales,
short sales against the box, puts and calls and other transactions in securities
of the Company or derivatives thereof, and may sell and deliver the Shares in
connection therewith. From time to time the Selling Stockholders may pledge
their Shares pursuant to the margin provisions of their respective customer
agreements with their respective brokers or otherwise. Upon a default by a
Selling Stockholder, the broker or pledgees may offer and sell the pledged
U.S. Foodservice Common Shares from time to time.
None of the proceeds from the sales of the Shares by the Selling
Stockholders will be received by the Company. The Company has agreed to bear
certain expenses in connection with the registration of the Shares being offered
by the Selling Stockholders. See "Selling Stockholders." The Company has
agreed to indemnify the Selling Stockholders and any underwriters, brokers,
dealers or agents (and their respective controlling persons) against certain
liabilities, including certain liabilities under the Securities Act.
The Selling Stockholders and any broker-dealers who act in connection
with the sale of Shares hereunder may be deemed to be "underwriters" as that
term is defined in the Securities Act, and any commissions received by them and
profit on any resale of the Shares as principal might be deemed to be
underwriting discounts and commissions under the Securities Act.
LEGAL MATTERS
The validity of the Shares offered hereby by the Westlund Provisions
Selling Stockholders has been passed upon for the Company by Hogan & Hartson
L.L.P., Washington, D.C.
EXPERTS
U.S. Foodservice. The consolidated financial statements of U.S.
Foodservice as of June 28, 1997 and for the year then ended incorporated by
reference in this Prospectus have been incorporated by reference herein and in
the registration statement in reliance upon the report of KPMG Peat Marwick LLP,
independent certified public accountants, incorporated herein by reference and
upon the authority of said firm as experts in auditing and accounting.
16
<PAGE>
The consolidated financial statements of U.S. Foodservice (formerly
JP Foodservice, Inc.) as of June 29, 1996 and for each of the two years in the
period ended June 29, 1996 incorporated by reference in this Prospectus have
been so incorporated in reliance on the report of Price Waterhouse LLP,
independent public accountants, given on the authority of said firm as experts
in auditing and accounting.
Valley Industries, Inc. The combined financial statements of Valley
Industries, Inc. and Subsidiaries and Z Leasing Company (a General Partnership)
as of January 31, 1996 and for each of the years in the two-year period ended
January 31, 1996 incorporated by reference in this Prospectus have been
incorporated by reference herein and in the registration statement in reliance
upon the report of KPMG Peat Marwick LLP, independent certified public
accountants, incorporated herein by reference and upon the authority of such
firm as experts in accounting and auditing.
Rykoff-Sexton. The audited consolidated financial statements of
Rykoff-Sexton and subsidiaries as of June 28, 1997 and April 27, 1996, and for
the fiscal years ended June 28, 1997, April 27, 1996 and April 29, 1995 and the
nine-week transition period ended June 29, 1996 incorporated by reference in
this Prospectus have been audited by Arthur Andersen LLP, independent public
accountants, as indicated in their reports with respect thereto and are
incorporated by reference herein in reliance upon the authority of said firm as
experts in giving said reports.
17
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable in connection with the sale and
distribution of the securities being registered. All amounts except the
Securities and Exchange Commission registration fee are estimated.
<TABLE>
<CAPTION>
ITEM AMOUNT
- ---- ----------
<S> <C>
Registration fee................... $2,484.23
Blue Sky fees and expenses......... *
Printing and engraving expenses.... *
Legal fees and expenses............ *
Accounting fees and expenses....... *
Transfer Agent and Registrar fees.. *
Miscellaneous...................... *
----------
Total $ *
</TABLE>
- ----------
* To be filed by amendment.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Reference is made to the provisions of Article XII of the registrant's
Restated Certificate of Incorporation filed as Exhibit 3.1 hereto and the
provisions of Article XII of the registrant's Amended and Restated By-laws filed
as Exhibit 3.2 hereto.
The registrant is a Delaware corporation, subject to the applicable
indemnification provisions of the General Corporation Law of the State of
Delaware (the "DGCL"). Section 145 of the DGCL provides for the
indemnification, under certain circumstances, of any person in connection with
any action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than derivative actions), brought or threatened involving
such persons because of such person's service in any such capacity with respect
to another corporation or other entity at the request of such corporation.
The registrant's Amended and Restated By-Laws provide for the
indemnification of the officers and directors of the registrant to the fullest
extent permitted by the DGCL. Article XII of the By-Laws provides that each
person who was or is made a party to (or is threatened to be made a party to)
any civil or criminal action, suit or proceeding by reason of the fact that such
person is or was a director or officer of the registrant shall be indemnified
and held harmless by the registrant to the fullest extent authorized by the DGCL
against all expense, liability and loss (including, without limitation,
attorneys' fees) incurred by such person in connection therewith, if such person
acted in good faith and in a manner such person reasonably believed to be or not
II-1
<PAGE>
opposed to the best interests of the registrant and had no reason to believe
that such person's conduct was illegal.
Article XII of the registrant's Restated Certificate of Incorporation
provides that, to the fullest extent permitted by the DGCL, the registrant's
directors will not be personally liable to the registrant or its stockholders
for monetary damages resulting from a breach of their fiduciary duties as
directors. However, nothing contained in such Article XII shall eliminate or
limit the liability of directors (i) for any breach of the director's duty of
loyalty to the registrant or its stockholders, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of the
law, (iii) under Section 174 of the DGCL or (iv) for any transaction from which
the director derived an improper personal benefit.
The registrant maintains directors and officers liability insurance, which
covers directors and officers of the registrant against certain claims or
liabilities arising out of the performance of their duties.
In the registration rights agreements with the Company pursuant to which
the securities offered hereby are being registered, the Selling Stockholders
have agreed to indemnify the registrant, its directors, officers and agents and
each person, if any, who controls the registrant against certain liabilities,
including certain liabilities under the Securities Act.
ITEM 16: EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
The following Exhibits are filed herewith or incorporated herein by
reference:
3.1 Restated Certificate of Incorporation of the Company
(incorporated by reference to Exhibit 3.1 to the Company's
Registration Statement on Form S-3 (Commission File
No. 333-41795)).
3.2 Amended and Restated By-Laws of the Company (incorporated by
reference to Exhibit 3.2 to the Company's Registration Statement
on Form S-3 (Commission File No. 333-41795)).
4.1 Specimen certificate representing common stock, par value
$.01 per share, of the Company (incorporated by reference to
Exhibit 4.1 to the Company's Registration Statement on Form S-3
(Commission File No. 333-27275)).
4.2 Rights Agreement, dated as of February 19, 1996, between U.S.
Foodservice and The Bank of New York, as Rights Agent (the
"Rights Agreement") (incorporated by reference to Exhibit 1 to
the Company's Registration Statement on Form 8-A dated February
22, 1996).
II-2
<PAGE>
4.3 Amendment No. 1 to Rights Agreement, dated as of May 17, 1996
(incorporated by reference to Exhibit 10.26 to Amendment No. 1 to
the Company's Registration Statement on Form S-3 (Commission File
No. 333-07321)).
4.4 Amendment No. 2 to Rights Agreement, dated as of September 26,
1996 (incorporated by reference to Exhibit 10.1 to Amendment No.
2 to the Company's Registration Statement on Form S-3 (Commission
File No. 333-14039)).
4.5 Amendment No. 3 to Rights Agreement, dated as of June 30, 1997
(incorporated by reference to Exhibit 4.1 to the Company's
Current Report on Form 8-K filed on July 2, 1997).
4.6 Amendment No. 4 to Rights Agreement, dated as of December 23,
1997 (incorporated by reference to the Company's Current Report
on Form 8-K filed on January 7, 1998).
*5.1 Opinion of Hogan & Hartson, L.L.P., counsel to the Company,
regarding the validity of the securities being offered by certain
selling stockholders.
23.1 Consent of Price Waterhouse LLP, Independent Accountants.
23.2 Consents of KPMG Peat Marwick LLP, Independent Accountants.
23.3 Consent of Arthur Andersen LLP, Independent Accountants.
*23.4 Consent of Hogan & Hartson, L.L.P. (contained in Exhibit 5.1).
24 Power of Attorney (included in signature page).
* To be filed by amendment.
(b) Financial Statement Schedules
Either not applicable or shown in the financial statements or notes
thereto.
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
II-3
<PAGE>
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate, represent
a fundamental change in the information set forth in the registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, the information
omitted from the form of Prospectus filed as part of this registration statement
in reliance upon Rule 430A and contained in a form of Prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act
shall be deemed to be part of this Registration Statement as of the time it was
declared effective.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the General Corporation Law of the State of Delaware, the
Restated Certificate of Incorporation or the Amended and Restated By-Laws of
registrant, indemnification agreements entered into between registrant and its
officers and directors, or otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a director,
officer, or controlling person of the registrant in the successful defense of
any action, suit or
II-4
<PAGE>
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Columbia, State of Maryland, on April 23, 1998.
U.S. FOODSERVICE
By: /s/ JAMES L. MILLER
-------------------------------------
James L. Miller
President and Chief Executive Officer
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Lewis Hay, III, David M. Abramson and
George T. Megas, and each of them, as his true and lawful attorneys-in-fact and
agents, with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this registration statement, and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
connection therewith and about the premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or any of them, or their or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ JAMES L. MILLER Chairman of the Board, President April 23, 1998
- --------------------- and Chief Executive Officer
James L. Miller (Principal Executive Officer)
/s/ LEWIS HAY, III Director, Executive Vice President April 23, 1998
- --------------------- and Chief Financial Officer
Lewis Hay, III (Principal Financial Officer)
/s/ GEORGE T. MEGAS Vice President - Finance April 23, 1998
- --------------------- (Principal Accounting Officer)
George T. Megas
/s/ MICHAEL J. DRABB Director April 23, 1998
- ---------------------
Michael J. Drabb
/s/ DAVID M. ABRAMSON Director April 23, 1998
- ---------------------
David M. Abramson
/s/ ERIC E. GLASS Director April 23, 1998
- ---------------------
Eric E. Glass
</TABLE>
II-6
<PAGE>
<TABLE>
<S> <C> <C>
/s/ MARK P. KAISER Director April 23, 1998
- --------------------------
Mark P. Kaiser
/s/ PAUL I. LATTA, JR. Director April 23, 1998
- --------------------------
Paul I. Latta, Jr.
/s/ DEAN R. SILVERMAN Director April 23, 1998
- --------------------------
Dean R. Silverman
/s/ JEFFREY D. SERKES Director April 23, 1998
- --------------------------
Jeffrey D. Serkes
/s/ JAMES P. MISCOLL Director April 23, 1998
- --------------------------
James P. Miscoll
/s/ BERNARD SWEET Director April 23, 1998
- --------------------------
Bernard Sweet
/s/ JAMES I. MASLON Director April 23, 1998
- --------------------------
James I. Maslon
/s/ NEIL I. SELL Director April 23, 1998
- --------------------------
Neil I. Sell
/s/ ALBERT J. FITZGIBBONS, III Director April 23, 1998
- ------------------------------
Albert J. Fitzgibbons, III
/s/ MATTHIAS B. BOWMAN Director April 23, 1998
- --------------------------
Matthias B. Bowman
</TABLE>
II-7
<PAGE>
INDEX TO EXHIBITS
EXHIBIT
NUMBER EXHIBITS
3.1 Restated Certificate of Incorporation of the Company (incorporated by
reference to Exhibit 3.1 to the Company's Registration Statement on
Form S-3 (Commission File No. 333-41795)).
3.2 Amended and Restated By-Laws of the Company (incorporated by reference
to Exhibit 3.2 to the Company's Registration Statement on Form S-3
(Commission File No. 333-41795)).
4.1 Specimen certificate representing common stock, par value $.01 per
share, of the Company (incorporated by reference to Exhibit 4.1 to the
Company's Registration Statement on Form S-3 (Commission File
No. 333-27275)).
4.2 Rights Agreement, dated as of February 19, 1996, between U.S.
Foodservice and The Bank of New York, as Rights Agent (the "Rights
Agreement") (incorporated by reference to Exhibit 1 to the Company's
Registration Statement on Form 8-A dated February 22, 1996).
4.3 Amendment No. 1 to Rights Agreement, dated as of May 17, 1996
(incorporated by reference to Exhibit 10.26 to Amendment No. 1 to
the Company's Registration Statement on Form S-3 (Commission File
No. 333-07321)).
4.4 Amendment No. 2 to Rights Agreement, dated as of September 26, 1996
(incorporated by reference to Exhibit 10.1 to Amendment No. 2 to
the Company's Registration Statement on Form S-3 (Commission File
No. 333-14039)) .
4.5 Amendment No. 3 to Rights Agreement, dated as of June 30, 1997
(incorporated by reference to Exhibit 4.1 to the Company's Current
Report on Form 8-K filed on July 2, 1997).
4.6 Amendment No. 4 to Rights Agreement, dated as of December 23, 1997
(incorporated by reference to the Company's Current Report on Form 8-K
filed on January 7, 1998).
<PAGE>
*5.1 Opinion of Hogan & Hartson, L.L.P., counsel to Company, regarding the
validity of the securities being offered by certain selling
stockholders.
23.1 Consent of Price Waterhouse LLP, Independent Accountants.
23.2 Consents of KPMG Peat Marwick LLP, Independent Accountants.
23.3 Consent of Arthur Andersen LLP, Independent Accountants.
*23.4 Consent of Hogan & Hartson, L.L.P. (contained in Exhibit 5.1).
24 Power of Attorney (included in signature page).
* To be filed by amendment.
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report
dated August 2, 1996, except as to Note 16, which is as of September 10, 1996
and except as to the pooling of interests with Valley Industries, Inc. and with
Squeri Foods, Inc. which is as of November 14, 1996, which appears on page F-36
of U.S. Foodservice (formerly JP Foodservice, Inc.) Form 8-K/A-1 dated March 9,
1998. We also consent to the references to us under the heading "Experts" in
such Prospectus.
PRICE WATERHOUSE LLP
Linthicum, Maryland
April 23, 1998
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
U.S. Foodservice:
We consent to incorporation by reference in this registration statement on
Form S-3 of U.S. Foodservice (formerly JP Foodservice, Inc.) of our report dated
March 4, 1998, relating to the consolidated balance sheet of U.S. Foodservice
and Subsidiaries as of June 28, 1997 and the related consolidated statement of
operations, stockholders' equity, and cash flows for the year then ended, which
report appears in the Form 8-K/A of U.S. Foodservice dated March 9, 1998 and to
the reference to our firm under the heading "Experts" in such registration
statement.
KPMG PEAT MARWICK LLP
Baltimore, Maryland
April 24, 1998
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
Valley Industries, Inc. and
Z Leasing Company:
We consent to the incorporation by reference in the registration statement of
U.S. Foodservice (formerly JP Foodservice, Inc.) on Form S-3 of our report dated
June 17, 1996, with respect to the combined balance sheets of Valley Industries,
Inc. and Subsidiaries and Z Leasing Company (A General Partnership) as of
January 31, 1996, 1995 and 1994 and the related combined statements of earnings,
stockholders' and partners' equity, and cash flows for each of the years in the
three-year period ended January 31, 1996, which report appears in the Form 8-K/A
of U.S. Foodservice dated March 9, 1998 and to the reference to our firm under
the heading "Experts" in such registration statement of U.S. Foodservice.
KPMG PEAT MARWICK LLP
Baltimore, Maryland
April 24, 1998
<PAGE>
EXHIBIT 23.3
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Form S-3 of our report dated August 14, 1997, originally
included in Rykoff-Sexton, Inc.'s Form 10-K, as amended by Form 10-K/A, for the
fiscal year ended June 28, 1997, and subsequently included in U.S. Foodservice's
(formerly JP Foodservice, Inc.) Form 8-K/A-1 dated March 9, 1998, and to all
references to our Firm included in this Registration Statement.
/s/ ARTHUR ANDERSEN LLP
Philadelphia, Pennsylvania
April 27, 1998
