ARLINGTON, Texas, Jan. 7, 2002 (PRIMEZONE) -- Fresh America Corp. (OTCBB:FRES), a major North American food distribution company (the "Company"), today announced the results of the Special Meeting of Shareholders that was held on December 28 - 29, 2001. At the meeting, approximately 61.9% of the shareholders of the Company voted in favor and approximately 5.9% voted against Proposal 1, the amendment to the Company's Articles of Incorporation to increase the number of authorized shares of the Company's common stock and to decrease the stated par value of the Company's common stock. As a supermajority of 66.67% of the outstanding shares entitled to vote in person or by proxy at the special meeting was required in order to approve Proposal 1, this proposal did not pass. Approximately 84.6% of the shareholders voted in favor and approximately 15% voted against Proposal 2, the adoption of the Fresh America Corp. 2001 Stock Option Plan. As a majority of the votes cast was required in order to approve Proposal 2, this proposal passed.
Because the Company did not receive a sufficient number of votes to approve Proposal 1, the amendment to the Company's Articles of Incorporation, certain rights and preferences associated with the Company's Series D Preferred Stock became effective as of January 1, 2002. The Company's preferred stock is currently held by North Texas Opportunity Fund LP ("NTOF") and John Hancock Life Insurance Company, John Hancock Variable Life Insurance Company, Signature 1A (Cayman), Ltd. and Signature 3 Limited (collectively, the "Hancock Entities"). The primary changes in the rights and preferences of the Preferred Stock were: special voting rights which now represent approximately 68% of the current voting power of the Company on a fully-diluted basis; an increase of the price at which the Company could be required to purchase the shares of the Preferred Stock if the put rights are exercised by the holders of the Preferred Stock; an enhanced liquidation preference in the event of the dissolution of the Company or upon the occurrence of certain other events; and the annual dividend rate on each share of Preferred Stock increased from $8 to $18 per share. Further details about the proposals and the changes to the rights and preferences of the Series D Preferred Stock are available in the Company's Proxy Statement as filed with the Securities and Exchange Commission on December 3, 2001. The Company is currently negotiating with the holders of the Series D Preferred Stock to determine which, if any, of those rights, the holders of the Series D Preferred Stock intend to waive.
Darren L. Miles, President and CEO of the Company, stated, "that although the Company was disappointed that the vote did not reach the two-thirds supermajority of the outstanding shares entitled to vote at the meeting required for approval of Proposal 1, we were very pleased that 91% of the shareholders who did vote, were in favor of the proposal. Fresh America is progressing on the strategic plan that was set at the time of the restructuring in September 2001 and the outcome of this vote will not have a negative impact on those efforts."
About Fresh America
Fresh America is an integrated food distribution management company that operates facilities and offices located in Dallas and Houston, Texas; Atlanta, Georgia; Scranton and Wilkes-Barre, Pennsylvania; Richmond, Indiana; Chicago, Illinois; and Norwalk and Walnut Creek/Visalia, California.
Forward-Looking Statement
This document includes "forward-looking statements" within the meaning of Section 27A of the Securities and Exchange Act of 1934, as amended, based on current management expectations. The Company's actual results could differ materially from those management expectations. Factors that could cause future results to vary from current management expectations include, but are not limited to, adverse weather conditions, a decrease in sales in the fresh produce industry due to the threat of bio-terrorism, continued loss of key sales personnel, general economic and market conditions, the availability and cost of borrowed funds and limitations arising from the Company's indebtedness, the Company's ability to refinance its existing bank debt and raise additional capital, seasonality, legislative and regulatory changes, industry competition, changes in accounting principles, policies and guidelines, and other economic, competitive, governmental factors affecting the Company's operations, markets, products, services and prices. Further description of the risks and uncertainties to the business are included in detail in the Company's quarterly report on Form 10-Q filed with the Securities and Exchange Commission on November 13, 2001 and annual report on Form 10-K, filed with the Securities and Exchange Commission on September 12, 2001.