-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LWa+tEMmyWpUSpnFpmjSLBJ+u7BFDwOPuimtoi7LdZO25kWt8Tow8W4d6IY0aMJ8 cP/opSTWy7LVIPd0GeJm9g== 0000835582-98-000014.txt : 19981019 0000835582-98-000014.hdr.sgml : 19981019 ACCESSION NUMBER: 0000835582-98-000014 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980912 FILED AS OF DATE: 19981016 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: HOMELAND HOLDING CORP CENTRAL INDEX KEY: 0000835582 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-GROCERY STORES [5411] IRS NUMBER: 731311075 STATE OF INCORPORATION: DE FISCAL YEAR END: 1228 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-11555 FILM NUMBER: 98726925 BUSINESS ADDRESS: STREET 1: 2601 N W EXPRESSWAY STREET 2: SUITE 1100E CITY: OKLAHOMA CITY STATE: OK ZIP: 73112 BUSINESS PHONE: 4058796600 MAIL ADDRESS: STREET 1: 2601 N W EXPRESSWAY STREET 2: SUITE 1100E CITY: OKLAHOMA CITY STATE: OK ZIP: 73112 FORMER COMPANY: FORMER CONFORMED NAME: SWO HOLDING CORP DATE OF NAME CHANGE: 19901017 FORMER COMPANY: FORMER CONFORMED NAME: SWO ACQUISTION CORP DATE OF NAME CHANGE: 19890716 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) Quarterly Report Under Section 13 or 15 (d) of the Securities X Exchange Act of 1934 For the quarterly period ended September 12, 1998 OR Transition Report Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934 For the transition period from _________to _________ Commission file No.: 33-48862 HOMELAND HOLDING CORPORATION (Exact name of registrant as specified in its charter) Delaware 73-1311075 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 2601 Northwest Expressway Oil Center-East, Suite 1100 Oklahoma City, Oklahoma 73112 (Address of principal executive offices) (Zip Code) (405) 879-6600 (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15 (d) of the Securities Exchange Act of 1934 subsequent to the distribution under a plan confirmed by a court. Yes X No Indicate the number of shares outstanding of each of the registrant's classes of common stock as of October 9, 1998: Homeland Holding Corporation Common Stock: 4,842,197 shares HOMELAND HOLDING CORPORATION FORM 10-Q FOR THE THIRTY-SIX WEEKS ENDED SEPTEMBER 12, 1998 INDEX Page PART 1 FINANCIAL INFORMATION ITEM 1. Financial Statements......................................... 1 Consolidated Balance Sheets as of September 12, 1998, and January 3, 1998................... 1 Consolidated Statements of Operations Twelve Weeks ended September 12, 1998, and September 6, 1997......................................... 3 Consolidated Statements of Operations Thirty-six Weeks ended September 12, 1998, and September 6, 1997......................................... 4 Consolidated Statements of Stockholders Equity (Deficit) Thirty-six Weeks ended September 12, 1998 and September 6, 1997......................................... 5 Consolidated Statements of Cash Flows Thirty-six Weeks ended September 12, 1998 and September 6, 1997......................................... 6 Notes to Consolidated Financial Statements................... 7 ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.................................... 8 PART II OTHER INFORMATION ITEM 3. Submission of Matters of a Vote of Security Holders.......... 12 ITEM 4. Other Information............................................ 12 ITEM 5. Exhibits and Reports on Form 8-K............................. 13 i PART I - FINANCIAL INFORMATION Item 1. Financial Statements HOMELAND HOLDING CORPORATION AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS (In thousands, except share and per share amounts) ASSETS September 12, January 3, 1998 1998 (Unaudited) Current assets: Cash and cash equivalents $ 5,007 $ 4,778 Receivables, net of allowance for uncollectible accounts of $1,085 and $1,198 9,789 9,313 Inventories 44,900 45,946 Prepaid expenses and other current assets 2,583 2,581 Total current assets 62,279 62,618 Property, plant and equipment: Land and land improvements 9,925 9,303 Buildings 20,136 19,995 Fixtures and equipment 26,441 22,267 Leasehold improvements 16,879 13,459 Software 5,134 4,991 Leased assets under capital leases 8,970 8,610 Construction in progress 311 2,769 87,796 81,394 Less, accumulated depreciation and amortization 17,988 11,299 Net property, plant and equipment 69,808 70,095 Reorganization value in excess of amounts allocable to identifiable assets, less accumulated amortization of $29,955 at September 12, 1998, and $20,346 at January 3, 1998 12,170 23,162 Other assets and deferred charges 9,940 10,166 Total assets $ 154,197 $ 166,041 Continued The accompanying notes are an integral part of these consolidated financial statements. 1 HOMELAND HOLDING CORPORATION AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS, Continued (In thousands, except share and per share amounts) LIABILITIES AND STOCKHOLDERS' EQUITY September 12, January 3, 1998 1998 (unaudited) Current liabilities: Accounts payable - trade $ 17,551 $ 18,941 Salaries and wages 2,414 2,508 Taxes 3,966 3,605 Accrued interest payable 959 2,619 Other current liabilities 7,621 10,042 Current portion of long-term debt 22,519 1,728 Current portion of obligations under capital leases 1,286 1,286 Total current liabilities 56,316 40,729 Long-term obligations: Long-term debt 60,182 78,353 Obligations under capital leases 2,054 2,608 Other noncurrent liabilities 1,814 2,027 Total long-term obligations 64,050 82,988 Stockholders' equity: Common Stock, $0.01 par value, authorized - 7,500,000 shares, issued 4,841,025 shares at September 12, 1998, and issued 4,820,637 shares at January 3, 1998 48 48 Additional paid-in capital 56,186 56,040 Accumulated deficit (22,403) (13,764) Total stockholders' equity 33,831 42,324 Total liabilities and stockholders' equity $ 154,197 $ 166,041 The accompanying notes are an integral part of these consolidated financial statements. 2 HOMELAND HOLDING CORPORATION AND SUBSIDIARY CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share amounts) (Unaudited) 12 weeks 12 weeks ended ended September 12, September 6, 1998 1997 Sales, net $ 118,129 $ 114,935 Cost of sales 89,665 87,690 Gross profit 28,464 27,245 Selling and administrative expenses 26,497 25,801 Amortization of excess reorganization value 3,123 3,271 Operating loss (1,156) (1,827) Interest expense 1,833 1,890 Loss before income taxes (2,989) (3,717) Income tax expense (benefit) 481 (250) Net loss (3,470) (3,467) Basic and diluted earnings per share: Net loss per share $ (0.72) $ (0.73) Weighted average shares outstanding 4,836,046 4,782,294 The accompanying notes are an integral part of these consolidated financial statements. 3 HOMELAND HOLDING CORPORATION AND SUBSIDIARY CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share amounts) (Unaudited) 36 weeks 36 weeks ended ended September 12, September 6, 1998 1997 Sales, net $ 363,041 $ 351,249 Cost of sales 275,733 266,171 Gross profit 87,308 85,078 Selling and administrative expenses 79,275 76,067 Amortization of excess reorganization value 9,609 10,095 Operating loss (1,576) (1,084) Interest expense 5,632 5,705 Loss before income taxes (7,208) (6,789) Income tax expense 1,431 1,471 Net loss (8,639) (8,260) Basic and diluted earnings per share: Net loss per share $ (1.79) $ (1.73) Weighted average shares outstanding 4,827,671 4,766,115 The accompanying notes are an integral part of these consolidated financial statements. 4 HOMELAND HOLDING CORPORATION AND SUBSIDIARY CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) (In thousands, except share and per share amounts) (Unaudited)
Common Stock Additional Paid-In Accumulated Stockholder's Shares Amount Capital Deficit Equity (Deficit) Balance, December 28, 1996 4,758,025 $ 48 $ 56,013 $ (3,120) $ 52,941 Net loss - - - (8,260) (8,260) Issuance of common stock 58,577 - 4 - 4 Balance, September 6, 1997 4,816,602 48 $ 56,017 $ (11,380) $ 44,685 Balance, January 3, 1998 4,820,637 $ 48 $ 56,040 $ (13,764) $ 42,324 Net loss - - - (8,639) (8,639) Issuance of common stock 20,388 - $ 146 - $ 146 Balance, September 12, 1998 4,841,025 $ 48 $ 56,186 $ (22,403) $ 33,831 -
The accompanying notes are an integral part of these consolidated financial statements. 5 HOMELAND HOLDING CORPORATION AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands, except share and per share amounts) (Unaudited) 36 weeks 36 weeks ended ended September 12, September 6, 1998 1997 Cash flows from operating activities: Net loss $ (8,639) $ (8,260) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 6,743 5,355 Amortization of excess reorganization value 9,609 10,095 Amortization of financing costs 52 43 Loss on disposal of assets 34 59 Amortization of beneficial interest in operating leases 84 84 Adjustment to excess reorganization value - 292 Deferred income taxes 1,383 1,176 Change in assets and liabilities: (Increase) decrease in receivables (476) 707 Decrease in inventories 1,046 812 (Increase) decrease in prepaid expenses and other current assets (2) 158 (Increase) decrease in other assets and deferred charges 66 (92) Increase (decrease) in accounts payable-trade (1,390) 442 Decrease in salaries and wages (94) (791) Increase in taxes 361 1,562 Decrease in accrued interest payable (1,660) (1,829) Decrease in other current liabilities (2,421) (917) Increase (decrease) in other noncurrent liabilities (191) 133 Net cash provided by operating activities 4,505 9,029 Cash flow used in investing activities: Capital expenditures (6,083) (5,762) Cash received from sale of assets 19 25 Net cash used in investing activities (6,064) (5,737) Cash flows used by financing activities: Borrowings under revolving credit loans 93,337 94,476 Payments under revolving credit loans (89,838) (92,504) Payments on tax notes (46) (46) Proceeds from issuance of common stock 146 - Principal payments under note payable (833) - Principal payments under capital lease obligations (978) (1,003) Net cash provided by financing activities 1,788 923 Net increase in cash and cash equivalents 229 4,215 Cash and cash equivalents at beginning of period 4,778 1,492 Cash and cash equivalents at end of period $ 5,007 $ 5,707 Supplemental information: Cash paid during the period for interest $ 7,541 $ 7,378 Cash paid during the period for income taxes $ - $ - The accompanying notes are an integral part of these consolidated financial statements. 6 HOMELAND HOLDING CORPORATION AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Basis of Preparation of Consolidated Financial Statements: The accompanying unaudited interim consolidated financial statements of Homeland Holding Corporation ("Holding") and its Subsidiary, Homeland Stores, Inc. ("Stores" and together with Holding, the "Company"), reflect all adjustments, which consist only of normal and recurring adjustments, which are, in the opinion of management, necessary for a fair presentation of the consolidated financial position and the consolidated results of operations and cash flows for the periods presented. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements of the Company for the period ended January 3, 1998, and the notes thereto. 2. Accounting Policies: The significant accounting policies of the Company are summarized in the consolidated financial statements of the Company for the 53 weeks ended January 3, 1998, and the notes thereto. 3. Net Loss Per Share: Options to purchase 257,000 shares of common stock with a weighted average exercise price of $6.66 were outstanding at September 12, 1998, but were not included in the computation of diluted earnings per share because the effect would be antidilutive. 4. Term Loan and Revolving Facility The Company's Term Loan and Revolving Facility will mature on August 1, 1999. Because this maturity date is within 12 months of this reporting period, $20,766 million of debt has been reclassified from long-term to current. The Company is currently in the process of negotiations with its banks to refinance the debt and extend the maturity date. 7 Item 2. Management's Discussion and Analysis of Financial Conditions and Results of Operations General The table below sets forth selected items from the Company's consolidated income statement as a percentage of net sales of the periods indicated: 12 weeks ended 36 weeks ended September 12, September 6, September 12, September 6, 1998 1997 1998 1997 Net Sales 100.0% 100.0% 100.0% 100.0% Cost of Sales 75.9 76.3 76.0 75.8 Gross Profit 24.1 23.7 24.0 24.2 Selling and administrative 22.4 22.4 21.8 21.7 Amortization of excess reorganization value 2.6 2.8 2.6 2.9 Operating profit (loss) (0.9) (1.6) (0.4) (0.3) Interest expense 1.6 1.6 1.6 1.6 Loss before income taxes (2.5) (3.2) (2.0) (1.9) Income tax provision 0.4 (0.2) 0.4 0.4 Net loss (2.9) (3.0) (2.4) (2.4) Results of Operations. Comparison of Twelve Weeks and Thirty-Six Weeks ended September 12, 1998, with Twelve Weeks and Thirty-Six Weeks ended September 6, 1997. Net sales for the 12 weeks and 36 weeks ended September 12, 1998, increased 2.8 % and 3.4%, respectively, from the net sales of the corresponding period of 1997. Comparable store sales for the 12 weeks and 36 weeks ended September 12, 1998, decreased by 1.45% and 1.87%, respectively, as compared to the corresponding periods of 1997. The improvement in total sales is partially due to an additional four stores in operation versus the same period last year. Incremental improvements have also come from continued usage of frequency card-based promotions and direct marketing efforts. However, the like-store sales decline in the quarter and year-to-date is primarily due to increasing competitive promotions and the opening of competitors' stores including third quarter openings of a Wal-Mart Supercenter in Broken Arrow, Ok. and a Price-Mart in Tulsa, Ok. 8 Gross profit as a percentage of sales for the 12 weeks ended September 12, 1998, was 24.1%, an increase from the corresponding period in 1997 of 23.7%. The increase in gross profit percentage for the quarter versus last year reflects the cycling of strong promotional spending in the prior year as well as improvements in the merchandising mix of higher gross profit departments. Lower cost of goods in certain categories also contributed to the margin improvement. Gross profit as a percentage of sales for the 36 weeks ended September 12, 1998, was 24.0%, a decrease from the corresponding period in 1997 of 24.2%. Selling and administrative expenses for the 12 weeks ended September 12, 1998, maintained a level of 22.4%, as a percentage of net sales, compared to 22.4% for the corresponding period of 1997. The Company was able to maintain last year's level of SG&A as a percentage of sales through increasing store level productivity and decreases in certain direct expenses, offset in part by increases in overhead expenses. For the 36 weeks ended September 12, 1998, selling and administrative expenses as a percentage of net sales increased by 0.1% to 21.8% from 21.7% in the corresponding period of 1997. The Company recorded amortization of excess reorganization value of $3.1 million and $9.6 million for the 12 weeks and 36 weeks ended September 12, 1998, respectively. The amortization of the excess reorganization value is expected to negatively affect earnings for the next four fiscal quarters. Interest expense for the 12 weeks ended September 12, 1998, and September 6, 1997, was $1.8 million. Interest expense for the 36 weeks ended September 12, 1998, was $5.6 million compared to $5.7 million for the 36 weeks ended September 6, 1997. The Company recorded an income tax provision of $0.1 million and $1.4 million for the 12 weeks and 36 weeks ended September 12, 1998, respectively. The effective tax rate differs from the statutory rate due to amortization of excess reorganization value, which is not deductible for income tax purposes. The net operating loss ("NOL") carryforwards available for utilization in 1998 are limited to approximately $3.3 million, the benefit of which is being recorded as a reduction of excess reorganization value rather than a reduction of income tax expense. The NOL carryforward available in 1998 is expected to be fully utilized in the fourth quarter of 1998, and accordingly, the Company will commence to incur income tax liabilities. The Company's EBITDA (as defined hereinafter) for the 12 weeks ended September 12, 1998, increased to $4.3 million or 3.6% of net sales, from the EBITDA of $3.3 million or 2.9% of net sales for the corresponding period in 1997. For the 36 weeks ended September 12, 1998, EBITDA was $14.9 million or 4.1% of net sales compared to $14.4 million or 4.1% for the corresponding period of 1997. Net loss for the 12 weeks ended September 12, 1998, was $3.5 million or $0.72 per share compared to a net loss of $3.5 million or $0.73 per share for the corresponding period in 1997. Net loss for the 36 weeks ended September 12, 1998, was $8.6 million or $1.79 per share 9 compared to a net loss of $8.3 million or $1.73 per share for the corresponding period in 1997. The Company is amortizing its excess reorganization value of $45 million over a three-year period, and such amortization has affected earnings significantly. If the Company excluded such amortization of excess reorganization value for the 12 weeks and 36 weeks ended September 12, 1998, the Company would record a loss of $0.3 million or $0.07 per share and income of $1.0 million or $0.20 per share, respectively. Liquidity and Capital Resources The primary sources of liquidity and capital for the Company's operations have been borrowing under the revolving credit facility and internally-generated funds. The Company's EBITDA (earnings before interest, taxes, depreciation and amortization), as presented below, is the Company's measurement of internally-generated cash for working capital needs, capital expenditures and payment of debt obligations: 12 weeks ended 36 weeks ended September 12, September 6, September 12, September 6, 1998 1997 1998 1997 Loss before income taxes (2,989) (3,717) (7,208) (6,789) Interest expense 1,833 1,890 5,632 5,705 Amortization of reorganization value 3,123 3,271 9,609 10,095 Depreciation and amortization 2,333 1,889 6,825 5,439 EBITDA 4,300 3,333 14,858 14,450 As a percentage of sales 3.6% 2.9% 4.1% 4.1% As a multiple of interest expense 2.3x 1.8x 2.6x 2.5x Cash flow from operations provided $4.5 million for the 36 weeks ended September 12, 1998, and $9.0 million for the 36 weeks ended September 6, 1997. The decrease in cash flow from operations for the 36 weeks ended September 12, 1998, was primarily due to decreases in trade accounts payable and other current liabilities. 10 The Company's investing activities used net cash of $6.1 million in the 36 weeks ended September 12, 1998, as compared to net cash used by investing activities of $5.7 million in the 36 weeks ended September 6, 1997. Financing activities of the Company provided net cash of $1.8 million and $0.9 million for the 36 weeks ended September 12, 1998, and September 6, 1997, respectively. As of September 12, 1998, the Company had $14.1 million of borrowings and $3.3 million of letters of credit outstanding under its $32.0 million revolving credit facility. The revolving credit facility provides for borrowings to the lesser of (a) $32.0 million or (b) the applicable borrowing base. The applicable borrowing base on September 12, was $30.0 million. Management believes that the revolving credit facility and cash flow from operations will be adequate for the Company's short- term requirements. The Company's Term Loan and Revolving Facility will mature on August 1, 1999. The Company is currently in the process of negotiations with its banks to refinance the debt and extend the maturity date. The Company is continuing to improve its store facilities through its capital expenditure program to maintain and enhance its market competitiveness. Cash capital expenditures for 1998 are expected to be at $12.9 million. The credit agreement limits the Company to $13.0 million cash capital expenditures for 1998. The Company is also allowed $7.0 million of new capital leases each year. Year 2000 As of October, 1996, Homeland had numerous computer systems which used a date structure which management was concerned might be adversely affected by the year 2000. Commencing in October, 1996, management implemented a program of analyzing its computer systems to identify areas of potential concern, both with respect to information technology and non-information technology systems (e.g., microcontrollers), and making changes to address those potential areas of concern. Such program has been implemented on a system-by-system basis and has included and will continue to include both consultation by Homeland with the vendors who provided its computer systems and internal testing by Homeland of those computer systems. Homeland expects to have substantially completed its analysis and testing of its financial reporting and store reporting systems in the fourth quarter of 1998. Management does not presently anticipate that such analysis and testing will reflect a need for any substantial changes to its financial reporting and store reporting systems. Management presently expects its program to be completed in the second quarter of 1999. As of the date hereof, the program is on schedule and Homeland has not deferred any part of its program. The only area which management presently believes might not be completely addressed by the second quarter of 1999 is the point-of-sale computers used in the operation of the stores. Homeland has been advised by its vendor that year 2000 compliant software will be released in December, 1998; however, while management wants to review such software upon its release, internal tests conducted by Homeland generally reflect that its point-of-sale computers are already year 2000 compliant. Even if the point-of-sale computers are determined not to be year 2000 compliant, management does not believe that such non-compliance would have a material adverse effect on Homeland because of the extended period available to install the software expected to be available from the vendor, the limited purposes for which the information generated thereby is used internally by Homeland and the manual systems used by Homeland in connection with the generation of that information. 11 Based on its program and its progress to date, management does not believe that a contingency plan is necessary and does not believe that Homeland has any significant exposure in connection with year 2000 compliance. As of the date hereof, no such contingency plan has been developed. The measurement of year 2000 compliance is necessarily fluid and management will continue to monitor the extent of such compliance and the effects associated with any non-compliance. Homeland is also assessing the status of its vendors' year 2000 readiness, principally through the review of questionnaires which Homeland circulated to its vendors. Although the responses from the vendors have not been conclusive, Homeland does not presently expect that it will be adversely affected by its vendors' year 2000 readiness. The cost of the program is not expected to exceed $1.5 million, most of which will be spent to replace older power management systems which operate various systems in 39 stores, unless Homeland needs to upgrade its software with respect to its point-of-sale computers and, if Homeland were required to upgrade its software with respect to its point-of-sale computers, the cost of the program is not expected to exceed $2.0 million. Homeland is funding those costs under its working capital facility. The program has not caused Homeland to defer any other significant information technology program. Safe Harbor Statements Under the Private Securities Litigation Reform Act of 1995 The statements made under Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations and other statements in this Form 10-Q which are not historical facts, particularly with respect to future net sales, are forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could render them materially inaccurate or different. The risks and uncertainties include, but are not limited to, the effect of economic conditions, the impact of competitive promotional and new store activities, labor cost, capital constraints, availability and costs of inventory, changes in technology and the effect of regulatory and legal developments. 12 PART II - OTHER INFORMATION Item 3. Submission of Matters to a Vote of Security Holders The Company held its 1998 Annual Meeting of Stockholders on July 9, 1998. At such meeting, Robert E. (Gene) Burris, David B. Clark, Edward B. Krekeler, Jr., Laurie M. Shahon, John A. Shields, William B. Snow and David N. Weinstein were elected to serve on the Board of Directors for a one-year term, ending at the next annual meeting. In the matter of the election of directors, the votes were as follows: For Withhold Authority Robert E. (Gene) Burris 3,923,174 37,416 David B. Clark 3,953,055 7,535 Edward B. Krekeler, Jr. 3,955,483 5,107 Laurie M. Shahon 3,953,935 6,655 John A. Shields 3,947,329 13,672 William B. Snow 3,949,193 11,397 David N. Weinstein 3,955,356 5,234 In the matter of ratification of the appointment of PricewaterhouseCoopers LLP (formerly Coopers & Lybrand L.L.P.) as independent auditors for Fiscal 1998, 3,949,540 votes were cast in favor of approval, 5,401 votes were cast against, and holders of 5,660 shares abstained or did not vote. In the matter of approving the amendment to Homeland Holding Corporations's 1997 Non-Employee Directors Stock Option Plan, 3,885,240 votes were cast in favor, 70,774 votes were cast against, and holders of 4,463 shares abstained or did not vote. Item 4. Other Information Mr. John C. Rocker has accepted the position of Vice President/ Operations effective September 14, 1998. 13 Item 5. Exhibits and Reports on Form 8-K (a) Exhibits: The following exhibits are filed as part of this report: Exhibit No. Description 27 Financial Data Schedule. (b) Report on Form 8-K: The Company did not file any Form 8-K during the quarter ended September 12, 1998. 14 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. HOMELAND HOLDING CORPORATION Date: October 16, 1998 By: /s/ David B. Clark David B. Clark, President, Chief Executive Officer and Director (Principal Executive Officer) Date: October 16, 1998 By: /s/ Deborah A. Brown Deborah A. Brown, Vice President - Accounting Corporate Controller, Treasurer and Assistant Secretary (Principal Financial Officer) EX-27 2
5 9-MOS JAN-02-1999 SEP-12-1998 5,007 0 10,874 1,085 44,900 62,279 87,796 17,988 154,197 56,316 60,000 0 0 48 33,783 154,197 363,041 363,041 275,733 275,733 88,884 0 5,632 (7,208) 1,431 (8,639) 0 0 0 (8,639) (1.79) (1.79)
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