Page 9 of 33 Pages
TENDER OPTION
STOCKHOLDERS AGREEMENT
Page 10 of 33 Pages
STOCKHOLDERS AGREEMENT
AGREEMENT dated October 31, 1996, among FOOD LION, INC., a
corporation organized under the laws of North Carolina ("Parent"), KK
ACQUISITION CORP., a Delaware corporation and an indirect wholly owned
subsidiary of Parent ("Sub"), KASH N' XXXXX FOOD STORES, INC., a Delaware
corporation (the "Company"), and the other parties signatory hereto
(individually a "Stockholder" and collectively, the "Stockholders").
WITNESSETH:
WHEREAS, concurrently herewith, Parent, Sub and the Company,
are entering into an Agreement and Plan of Merger (as such agreement may
hereafter be amended from time to time, the "Merger Agreement"), pursuant
to which Sub will be merged with and into the Company (the "Merger"); and
WHEREAS, as an inducement and a condition to entering into the
Merger Agreement, Parent has required that the Company and Stockholders
agree, and the Company and Stockholders have agreed, to enter into this
Agreement;
NOW, THEREFORE, in consideration of the foregoing and the
mutual premises, representations, warranties, covenants and agreements
contained herein, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. DEFINITIONS. For purposes of this Agreement:
1.1 "Company Common Stock" shall mean at any time the
Common Stock, $.01 par value, of the Company.
1.2 "Person" shall mean an individual, corporation,
partnership, joint venture, association, trust, unincorporated
organization, limited liability company or other entity.
1.3 Capitalized terms used and not defined herein have
the respective meanings ascribed to them in the Merger Agreement.
2. PROVISIONS CONCERNING COMPANY COMMON STOCK. Each
Stockholder hereby agrees that, during the period commencing on the date
hereof and continuing until the first to occur of the Effective Time or
termination of this Agreement, at any meeting of the holders of Company
Common Stock, however called, or in connection with any written consent
of the holders of Company Common Stock, such Stockholder shall vote (or
cause to be voted) the number of shares of Company Common Stock
(collectively with the associated Company Rights, the "Shares") set forth
opposite such Stockholder's name on Schedule 1 hereto (collectively with
the associated Company Rights, the "Existing Shares") and any Shares
acquired by such Stockholder after the date hereof (collectively with the
Existing Shares, the "Option Shares"): (i) in favor of the
Page 11 of 33 Pages
Merger, the execution and delivery by the Company of the Merger Agreement
and the approval of the terms thereof and each of the other actions
contemplated by the Merger Agreement and this Agreement and any actions
required in furtherance thereof and hereof; (ii) against any action, any
failure to act, or agreement that would result in a breach in any
respect of any covenant, representation or warranty or any other obligation
or agreement of the Company under the Merger Agreement or this Agreement
(before giving effect to any materiality or similar qualifications
contained therein); and (iii) except as otherwise agreed to in writing
in advance by Parent, against the following actions (other than the Merger
and the transactions contemplated by the Merger Agreement):
(A) any extraordinary corporate transaction, such as a merger, consolidation
or other business combination involving the Company or its Subsidiaries;
(B) a sale, lease or transfer of a material amount of assets of the
Company or its Subsidiaries, or a reorganization, recapitalization,
dissolution or liquidation of the Company or its Subsidiaries; (C) (1)
any change in a majority of the persons who constitute the board of
directors of the Company; (2) any change in the present capitalization of
the Company or any amendment of the Company's Certificate of
Incorporation or Bylaws; (3) any other material change in the Company's
corporate structure or business; or (4) any other action involving the
Company or its Subsidiaries which is intended, or could reasonably be
expected, to impede, interfere with, delay, postpone, or materially
adversely affect the Merger and the transactions contemplated by this
Agreement and the Merger Agreement. Each Stockholder agrees that it
shall not enter into any agreement or understanding with any person or
entity the effect of which would be to violate the provisions and
agreements contained in this Section 2.
3. PURCHASE RIGHT.
3.1 OPTION SHARES. In order to induce Parent and Sub to
enter into the Merger Agreement, each Stockholder hereby grants to Sub an
irrevocable option (the "Stock Option") to purchase the Option Shares at
a cash purchase price per share equal to $26.00 or such higher price as
is paid by Sub for Shares in the Offer, the Merger or otherwise (other
than pursuant to Section 3.01(d) of the Merger Agreement and other than
in the settlement or other resolution of litigation) (the "Purchase
Price"). The Stock Options shall become exercisable, in whole but not in
part as to all then outstanding Stock Options, when all waiting periods
under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended (the "HSR Act"), required for the purchase of the Option Shares
upon such exercise shall have expired or been waived, unless there shall
then be in effect any preliminary or final injunction or other order
issued by any court or governmental, administrative or regulatory agency
or authority prohibiting the exercise of the Stock Option pursuant to
this Agreement, and shall remain exercisable, in whole but not in part as
to all then outstanding Stock Options, until termination of this
Agreement in accordance with Section 8.15 hereof. In the event that Sub
wishes to exercise the Stock Options, Sub shall send a written notice
(the "Notice") to the Stockholders identifying the place for the closing
of such purchase (the "Closing") at least three (3) but not more than
five (5) business days prior to the Closing.
Page 12 of 33 Pages
3.2 PAYMENT OF PURCHASE PRICE. The payment of the
Purchase Price shall be made by wire transfer in immediately available
funds on the date of Closing; PROVIDED, HOWEVER, that, in the event the
Purchase Price is increased pursuant to Section 3.1 to more than $26.00
per Share, the amount of such increase per Share shall be paid to each
Stockholder in immediately available funds within one business day after
the Effective Time.
4. OTHER COVENANTS, REPRESENTATIONS AND WARRANTIES. Each
Stockholder hereby represents and warrants to Parent with respect to such
Stockholder as follows:
4.1 OWNERSHIP OF SHARES. Stockholder is the record or
beneficial owner of the number of Shares set forth opposite such
Stockholder's name on Schedule I hereto. On the date hereof, the
Existing Shares set forth opposite such Stockholder's name on Schedule I
hereto constitute all of the Shares owned of record by such Stockholder.
Stockholder has sole voting power and sole power to issue instructions
with respect to the matters set forth in this Agreement and the Proxy (as
defined below), sole power of disposition, sole power of conversion, sole
power to demand appraisal rights and sole power to agree to all of the
matters set forth in this Agreement and Proxy, in each case with respect
to all of the Existing Shares set forth opposite Stockholder's name on
Schedule I hereto, with no limitations, qualifications or restrictions on
such rights, subject to applicable securities laws and the terms of this
Agreement and the Proxy. Following the date hereof, Stockholder will
cooperate with Parent and use its reasonable best efforts as soon as
possible to become the record owner of any Shares referred to on Schedule
I hereto as to which Stockholder is the beneficial owner and to cause
certificates representing the Shares to be affixed with a legend
reasonably satisfactory to Parent referencing this Agreement and the
Stockholder's obligations hereunder.
4.2 POWER; BINDING AGREEMENT. Stockholder has the legal
capacity, power and authority to enter into and perform all of
Stockholder's obligations under this Agreement and the Proxy. The
execution, delivery and performance of this Agreement and the Proxy have
been duly authorized by such Stockholder and do not and will not violate
any other agreement to which Stockholder is a party including, without
limitation, any voting agreement, stockholders agreement or voting trust.
This Agreement and the Proxy have been duly and validly executed and
delivered by Stockholder and constitute valid and binding agreements of
such Stockholder, enforceable against such Stockholder in accordance with
their terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
the enforcement of creditors' rights generally and by general equitable
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law). There is no beneficiary or holder of a
voting trust certificate or other interest of any trust of which
Stockholder is trustee whose consent is required for the execution and
delivery of this Agreement, the Proxy or the consummation by the
Stockholder of the transactions contemplated hereby and thereby.
Page 13 of 33 Pages
4.3 NO CONFLICTS. Except for filings under the HSR Act,
the Exchange Act and any applicable state antitrust laws (i) no filing
with, and no permit, authorization, consent or approval of, any state or
federal public body or authority or any other person is necessary for the
execution of this Agreement and the Proxy by Stockholder and the
consummation by Stockholder of the transactions contemplated hereby and
thereby and (ii) none of the execution and delivery of this Agreement and
the Proxy by Stockholder, the consummation by such Stockholder of the
transactions contemplated hereby and thereby or compliance by Stockholder
with any of the provisions hereof or thereof shall (A) conflict with or
result in any breach of any applicable organizational documents
applicable to Stockholder, (B) result in a violation or breach of, or
constitute (with or without notice or lapse of time or both) a default
(or give rise to any third party right of termination, cancellation,
material modification or acceleration) under any of the terms, conditions
or provisions of any note, bond, mortgage, indenture, license, contract,
commitment, arrangement, understanding, agreement or other instrument or
obligation of any kind to which Stockholder is a party or by which such
Stockholder or any of such Stockholder's properties or assets may be
bound, or (C) violate any order, writ, injunction, decree, judgment,
order, statute, rule or regulation applicable to Stockholder or any of
Stockholder's properties or assets.
4.4 NO ENCUMBRANCES. Except pursuant to this Agreement
and the Proxy, Stockholder's Shares and the certificates representing
such Shares are now, and at all times during the term hereof will be,
held by such Stockholder, or by a nominee or custodian for the benefit of
such Stockholder, free and clear of all Liens, hypothecations, claims,
security interests, proxies, voting trusts or agreements, understandings
or arrangements or any other encumbrances whatsoever, except for any such
encumbrances or proxies arising hereunder. The transfer by Stockholder
of its Shares to Sub in the Offer or otherwise hereunder shall pass to
and unconditionally vest in Sub good and valid title to the number of
Shares to be transferred by Stockholder thereunder or hereunder, free and
clear of all claims, Liens, restrictions, security interests, pledges,
hypothecations, limitations and encumbrances whatsoever.
4.5 NO SOLICITATION. Until the earlier of the Effective
Time or termination of this Agreement in accordance with its terms,
Stockholder shall not, in its capacity as such, directly or indirectly,
solicit (including by way of furnishing information) or respond to any
inquires or the making of any proposal by any person or entity, or enter
into any negotiations, agreements or understandings with any Person
(other than Parent, Sub or a person designated by Parent) with respect to
the Company that constitutes an Alternative Proposal. If Stockholder
receives any such inquiry or proposal, then Stockholder shall promptly
inform Parent of the existence thereof.
4.6 RESTRICTION ON TRANSFER, PROXIES AND NON-
INTERFERENCE. Beginning on the date hereof and ending on the earlier of
the Effective Time or termination of this Agreement, except as required
to comply with the provisions of this Agreement or the Proxy, the
Stockholder shall not (i) directly or indirectly, offer for sale, sell,
transfer, tender, pledge, encumber, assign or otherwise dispose of, or
enter into any contract, option or other arrangement or understanding
with respect to or
Page 14 of 33 Pages
consent to the offer for sale, sale, transfer, tender,
pledge, encumbrance, assignment or other disposition of, any or all of
such Stockholder's Shares or any interest therein; (ii) grant any proxies
or powers of attorney, deposit any Shares into a voting trust or enter
into a voting agreement with respect to any shares; or (iii) take any
action that would make any representation or warranty of such Stockholder
contained herein untrue or incorrect or have the effect of preventing or
disabling Stockholder from performing Stockholder's obligations under
this Agreement or the Proxy. Notwithstanding the foregoing, any
Stockholder may sell such Stockholder's Shares in a privately-negotiated
transaction to any person who, as a condition to such purchase, (i)
becomes a party to this Agreement with the same effect as though an
original signatory hereto by a written instrument in form and substance
satisfactory to Parent and (ii) delivers to Parent a Proxy (as defined in
Section 8.18) with respect to such Shares.
4.7 WAIVER OF APPRAISAL RIGHTS. Stockholder hereby
waives any rights of appraisal or rights to dissent from the Merger that
Stockholder may have.
4.8 RELIANCE BY PARENT. Stockholder understands and
acknowledges that Parent is entering into, and causing Sub to enter into,
the Merger Agreement in reliance upon Stockholder's execution and
delivery of this Agreement and the Proxy.
4.9 FURTHER ASSURANCES. From time to time, at any other
party's request and without further consideration, each party hereto
shall execute and deliver such additional documents and take all such
further lawful action as may be reasonably necessary or desirable to
consummate and make effective, in the most expeditious manner
practicable, the transactions contemplated by this Agreement and the
Proxy.
4.10 NO FINDER'S FEES. Other than existing financial
advisory and investment banking arrangements and agreements entered into
by the Company, no broker, investment banker, financial adviser or other
person is entitled to any broker's, finder's, financial adviser's or
other similar fee or commission in connection with the transactions
contemplated hereby based upon arrangements made by or on behalf of such
Stockholder.
5. TENDER OF SHARES.
5.1 TENDER REQUIREMENT. Each Stockholder hereby agrees
to validly tender (and not to withdraw) pursuant to and in accordance
with the terms of the Offer (provided that the Offer is commenced and not
amended in a manner adverse to Stockholder), not later than the tenth
business day after commencement of the Offer pursuant to Section 10.1 of
the Merger Agreement and Rule 14d-2 under the Exchange Act, the Option
Shares owned by it. Each Stockholder hereby acknowledges and agrees that
the obligation of Parent or Sub to accept for payment and pay for Company
Common Stock in the offer, including the Shares, is subject to the terms
and conditions
Page 15 of 33 Pages
of the Offer. Each Stockholder shall be entitled to
receive the highest price paid by Sub pursuant to the Offer, the Merger
or otherwise (other than pursuant to Section 3.01(d) of the Merger
Agreement and other than in the settlement or other resolution of
litigation).
5.2 PERMISSION TO DISCLOSE. Each Stockholder hereby
agrees to permit Parent and Sub to publish and disclose in any documents
filed with any Governmental or Regulatory Authority in connection with
the Merger, including, if Company Stockholders' Approval is required
under applicable law, the Proxy Statement (including all documents and
schedules filed with the SEC), its identity and ownership of Company
Common Stock and the nature of its commitments, arrangements and
understandings under this Agreement.
6. STOP TRANSFER; CHANGES IN SHARES. Each Stockholder agrees
with, and covenants to, Parent that beginning on the date hereof and
ending on the date of termination of the Agreement, such Stockholder
shall not request that the Company, and the Company hereby agrees with,
and covenants to, Parent that beginning on the date hereof and ending on
the date of termination of this Agreement it will not, register the
transfer (book-entry or otherwise) of any certificate or uncertificated
interest representing any of such Stockholder's Shares, unless such
transfer is made in compliance with this Agreement. In the event of a
dividend or distribution, or any change in the Company Common Stock by
reason of any dividend, split-up, recapitalization, combination, exchange
of shares or the like, the term "Shares" shall be deemed to refer to and
include the Shares as well as all such dividends and distributions and
any Shares into which or for which any or all of the Shares may be
changed or exchanged and the Purchase Price shall be appropriately
adjusted.
7. CONDUCT AS A DIRECTOR. Notwithstanding anything in this
Agreement to the contrary, the covenants and agreements set forth herein
shall not prevent any of the Stockholders' designees serving on the
Company's Board of Directors from taking any action, subject to the
applicable provisions of the Merger Agreement, while acting in such
designee's capacity as a director of the Company; PROVIDED, THAT, such
action shall not in any manner affect Stockholder's obligations under
this Agreement or the Proxy.
8. MISCELLANEOUS.
8.1 ENTIRE AGREEMENT. This Agreement, the Proxy and the
Merger Agreement constitute the entire agreement among the parties with
respect to the subject matter hereof and supersede all other prior
agreements and understandings, both written and oral, among any of the
parties with respect to the subject matter hereof.
8.2 CERTAIN EVENTS. Each Stockholder agrees that this
Agreement and the Proxy and the obligations hereunder and thereunder
shall attach to such Stockholder's Shares and shall be binding upon any
person or entity to which legal or beneficial ownership of such Shares
shall pass, whether by operation of law or
Page 16 of 33 Pages
otherwise, including, without
limitation, such Stockholder's heirs, guardians, administrators or
successors. Notwithstanding any transfer of Shares, the transferor shall
remain liable for the performance of all obligations of the transferor
under this Agreement.
8.3 ASSIGNMENT. This Agreement shall not be assigned
without the prior written consent of the other parties hereto and no
rights, or any direct or indirect interest herein, shall be transferable
hereunder without the prior written consent of the other parties hereto;
PROVIDED, THAT, Parent and Sub may assign or transfer their rights
hereunder to any wholly-owned subsidiary of Parent, which assignment
shall not relieve Parent or Sub of any of their respective obligations
hereunder.
8.4 AMENDMENTS, WAIVERS, ETC. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or
terminated, except upon the execution and delivery of a written agreement
executed by the parties to be bound thereby.
8.5 NOTICES. All notices, requests, claims, demands and
other communications hereunder shall be in writing and shall be given
(and shall be deemed to have been duly received if so given) by hand
delivery, telegram, telex or telecopy, or by mail (registered or
certified mail, postage prepaid, return receipt requested) or by any
courier services, such as Federal Express, providing proof of delivery.
All communications hereunder shall be delivered to the respective parties
at the following addresses:
If to Stockholders:At the addresses set forth on Schedule 1 hereto
with a copy to: Milbank, Tweed, Xxxxxx & XxXxxx
0 Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to Parent or Sub: Food Lion, Inc.
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: R. Xxxxxxx XxXxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Page 17 of 33 Pages
with a copy to: Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
0000 Xxx Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxxx X. Xxxxx, Xx., P.C.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth
above.
8.6 SEVERABILITY. Whenever possible, each provision or
portion of any provision of this Agreement and the Proxy will be
interpreted in such manner as to be effective and valid under applicable
law but if any provision or portion of any provision of this Agreement or
the Proxy is held to be invalid, illegal or unenforceable in any respect
under any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision or
portion of any provision in such jurisdiction, and this Agreement and the
Proxy will be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision or portion of any
provision had never been contained herein.
8.7 SPECIFIC PERFORMANCE. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants or
agreements contained in this Agreement or the Proxy will cause the other
parties to sustain damages for which it would not have an adequate remedy
at law for money damages, and therefore each of the parties hereto agrees
that in the event of any such breach the aggrieved parties shall be
entitled to the remedy of specific performance of such covenants and
agreements and injunctive and other equitable relief in addition to any
other remedy to which they may be entitled, at law or in equity.
8.8 REMEDIES CUMULATIVE. All rights, powers and remedies
provided under this Agreement or the Proxy or otherwise available in
respect hereof at law or in equity shall be cumulative and not
alternative, and the exercise of any thereof by any party shall not
preclude the simultaneous or later exercise of any other such right,
power or remedy by such party.
8.9 NO WAIVER. The failure of any party hereto to
exercise any right, power or remedy provided under this Agreement or the
Proxy or otherwise available in respect hereof at law or in equity, or to
insist upon compliance by any other party hereto with its obligations
hereunder or thereunder, and any custom or practice of the parties at
variance with the terms hereof or thereof, shall not constitute a waiver
by such party of its right to exercise any such or other right, power or
remedy or to demand such compliance.
Page 18 of 33 Pages
8.10 NO THIRD PARTY BENEFICIARIES. This Agreement is not
intended to be for the benefit of, and shall not be enforceable by, any
person or entity who or which is not a party hereto.
8.11 GOVERNING LAW. This Agreement and the Proxy shall be
governed and construed in accordance with the laws of the State of
Delaware, without giving effect to the principles of conflicts of law
thereof.
8.12 JURISDICTION. Each party hereby irrevocably submits
to the exclusive jurisdiction of the United States District Court for the
District of Delaware or any court of the State of Delaware located in the
City of Wilmington in any action, suit or proceeding arising in
connection with this Agreement or the Proxy, and agrees that any such
action, suit or proceeding shall be brought only in such court (and
waives any objection based on forum non conveniens or any other objection
to venue therein); PROVIDED, HOWEVER, that such consent to jurisdiction
is solely for the purpose referred to in this Section 8.12 and shall not
be deemed to be a general submission to the jurisdiction of said Courts
or in the State of Delaware other than for such purposes.
8.13 DESCRIPTIVE HEADINGS. The descriptive headings used
herein are inserted for convenience of reference only and are not
intended to be part of or to affect the meaning or interpretation of this
Agreement.
8.14 COUNTERPARTS; EFFECTIVENESS. This Agreement may be
executed in counterparts, each of which shall be deemed to be an
original, but all of which, taken together, shall constitute one and the
same Agreement. Notwithstanding the foregoing, this Agreement shall not
be effective as to any Stockholder until executed by all Stockholders.
8.15 TERMINATION. This Agreement may be terminated, and
the transactions contemplated hereby may be abandoned, by any Stockholder
at any time prior to the exercise of the Stock Option as to such
Stockholder's Option Shares (such date being referred to herein as the
"Termination Date"):
8.15.1 At any time after the Merger Agreement is
terminated in accordance with its terms by the Company due to the
material breach of any representation, warranty, covenant or agreement on
the part of Parent or Sub set forth in the Merger Agreement; or
8.15.2 At any time after the earlier of (x) 5:00 p.m.
Eastern Time on the date which is five (5) business days after the date
of termination of the Merger Agreement for any reason not specified in
Section 8.15.1 above and (y) 5:00 p.m. Eastern Time on March 7, 1997.
8.16 OBLIGATION TO EFFECT MERGER. If the Closing occurs
and the Merger Agreement is terminated other than due to a breach of any
representation, warranty, covenant or agreement on the part of the
Company set forth in the Merger
Page 19 of 33 Pages
Agreement or the failure to satisfy any
of the conditions set forth in Article VIII or Section 10.2 of the
Merger Agreement, then Parent and Sub shall use commercially reasonable
efforts to effect the Merger at a price per Share equal to the Merger
Price as soon as reasonably practicable.
8.17 CERTIFICATION. Each Stockholder hereby agrees that
its Option Shares, whether now owned or hereafter acquired, shall be
certificated by the Company, and that the Company shall place the
following legend on any certificate representing its Option Shares:
Transfer and Voting of the Securities represented by this
Certificate are subject to restrictions set forth in a Stockholders
Agreement dated October 31, 1996, a copy of which may be obtained
from the Company at its principal executive offices.
8.18 IRREVOCABLE PROXY. Each Stockholder acknowledges
that, concurrently with the execution of this Agreement, it has executed
and delivered to Parent an Irrevocable Proxy, the form of which is
attached hereto as Exhibit A hereto (the "Proxy").
Page 20 of 33 Pages
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
FOOD LION, INC. KK ACQUISITION CORP. KASH N' XXXXX FOOD
STORES,
INC.
By: By: By:
Name: Name: Name:
Title: Title: Title:
STOCKHOLDERS
BANKAMERICA CAPITAL CITICORP NORTH AMERICA, LANDMARK EQUITY
PARTNERS,
CORPORATION INC. III, L.P.
By: By: By:
Name: Name: Name:
Title: Title: Title:
LANDMARK EQUITY PRUDENTIAL INSURANCE PAINEWEBBER CAPITAL
INC. PARTNERS, IV, L.P. COMPANY OF AMERICA
By: By: By:
Name: Name: Name:
Title: Title: Title:
UBS CAPITAL LLC HIGH YIELD PORTFOLIO IDS BOND FUND, INC.
By: By: By:
Name: Name: Name:
Title: Title: Title:
IDS LIFE ADVANTAGE FUND THE PRUDENTIAL INSURANCE PRUCO LIFE INSURANCE
COMPANY COMPANY OF AMERICA
By:
By: By: Name:
Name: Name: Title:
Title: Title:
XXXXX, FARGO & COMPANY
By:
Name:
Title:
Page 21 of 33 Pages
SCHEDULE 1 TO
STOCKHOLDERS AGREEMENT
Name and Address Number of Shares Owned
of Stockholder
BankAmerica Capital Corporation 129,988
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Citicorp North America, Inc. 145,076
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Landmark Equity Partners III, L.P. 174,091
000 Xxxxxxxxx Xxxxxx
X.X. Xxx 000
Xxxxxxxx, XX 00000
Landmark Equity Partners IV, L.P. 9,285
000 Xxxxxxxxx Xxxxxx
X.X. Xxx 000
Xxxxxxxx, XX 00000
The Prudential Insurance Company 585,904
of America
Two Gateway Center
Floor 7
000 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Prudential Property & Casualty 27,855
Company
c/o The Prudential Insurance Company
of America
Two Gateway Center
Floor 7
000 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Pruco Life Insurance Company of 14,869
Arizona
c/o The Prudential Insurance Company
of America
Two Gateway Center
Floor 7
000 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Page 22 of 33 Pages
PaineWebber Capital Inc. 533,601
0000 Xxxxxx xx xxx Xxxxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
UBS Capital LLC 145,076
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
High Yield Portfolio 822,430
c/o American Express Financial
Corporation
0000 XXX Xxxxx 00
Xxxxxxxxxxx, XX 00000-0000
IDS Bond Fund, Inc. 149,570
c/o American Express Financial
Corporation
0000 XXX Xxxxx 00
Xxxxxxxxxxx, XX 00000-0000
IDS Life Advantage Fund 20,000
c/o American Express Financial
Corporation
0000 XXX Xxxxx 00
Xxxxxxxxxxx, XX 00000-0000
The Prudential Insurance Company 220,515
of America
c/o Prudential Capital Group -
Corporates
Four Xxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Pruco Life Insurance Company 11,606
c/o Prudential Capital Group -
Corporates
Four Xxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Page 23 of 33 Pages
Xxxxx, Fargo & Company 145,076
MAC 0195-171
000 Xxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Page 24 of 33 Pages
EXHIBIT A
to Stockholders Agreement
IRREVOCABLE PROXY
The undersigned stockholder of Kash n' Xxxxx Food Stores, Inc., a
Delaware corporation (the "Company"), hereby irrevocably (to the fullest
extent provided by law, but subject to automatic termination and
revocation as provided below) appoints KK Acquisition Corp., a Delaware
corporation (the "Sub"), the attorney and proxy of the undersigned, with
full power of substitution and resubstitution, to the full extent of the
undersigned's rights with respect to the shares of capital stock of the
Company owned beneficially or of record by the undersigned, which shares
are listed on the final page of this Proxy, and any and all other shares
or securities of the Company issued or issuable with respect thereof or
otherwise acquired by stockholder on or after the date hereof, until the
termination date specified in the Stockholders Agreement referred to
below (the "Shares"). Upon the execution hereof, all prior proxies given
by the undersigned with respect to the Shares are hereby revoked and no
subsequent proxies will be given as to the matters covered hereby prior
to the date of termination of the Stockholders Agreement (the
"Termination Date"). This proxy is irrevocable (to the fullest extent
provided by law, but subject to automatic termination and revocation as
provided below), coupled with an interest, and is granted in connection
with the Stockholders Agreement, dated as of October 31, 1996, among the
Company, Food Lion, Inc., a North Carolina corporation ("Parent"), Sub
and the Stockholders party thereto, including the undersigned stockholder
(the "Stockholders Agreement," capitalized terms not otherwise defined
herein being used herein as therein defined), and is granted in
consideration of the Company entering into the Merger Agreement referred
to therein.
The attorney and proxy named above will be empowered at any time
prior to the Termination Date to exercise all voting and other rights
with respect to the Shares (including, without limitation, the power to
execute and deliver written consents with respect to the Shares) of the
undersigned at every annual, special or adjourned meeting of shareholders
of the Company and in every written consent in lieu of such a meeting, or
otherwise: (i) in favor of the Merger, the execution and delivery by the
Company of the Merger Agreement and the approval of the terms thereof and
the Stockholders Agreement and each of the other actions contemplated by
the Merger Agreement and the Stockholders Agreement and any actions
required in furtherance thereof; (ii) against any action, any failure to
act, or agreement, that would result in a breach in any respect of any
covenant, representation or warranty or any other obligation or agreement
of the Company under the Merger Agreement or the Stockholders Agreement
(before giving effect to any materiality or similar qualifications
contained therein); and (iii) against the following actions (other than
the Merger and the transactions contemplated by the Merger Agreement):
(A) any extraordinary corporate transaction, such as a merger,
consolidation or other business combination involving the Company or its
Subsidiaries; (B) a sale, lease or transfer of a material amount of
assets of the Company or its Subsidiaries, or
Page 25 of 33 Pages
a reorganization,
recapitalization, dissolution or liquidation of the Company or its
Subsidiaries; (C) (1) any change in a majority of the persons who
constitute the board of directors of the Company; (2) any change in the
present capitalization of the Company or any amendment of the Company's
Certificate of Incorporation or Bylaws; (3) any other material change in
the Company's corporate structure or business; or (4) any other action
involving the Company or its Subsidiaries which is intended, or could
reasonably be expected, to impede, interfere with, delay, postpone, or
materially adversely affect the Merger and the transactions contemplated
by this Agreement and the Merger Agreement.
The attorney and proxy named above may only exercise this proxy to
vote the Shares subject hereto in accordance with the preceding
paragraph, and may not exercise this proxy in respect of any other
matter. The undersigned shareholder may vote the Shares (or grant one or
more proxies to vote the Shares) on all other matters.
Any obligation of the undersigned hereunder shall be binding upon
the successors and assigns of the undersigned.
This proxy is irrevocable, but shall automatically terminate and be
revoked and be of no further force and effect on and after the
Termination Date.
Dated: October 31, 1996 STOCKHOLDER
By:
Name:
Title:
Shares Owned:
