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                            UNITED STATES SECURITIES
                            AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549
                            ------------------------
                                   FORM 10-K

(MARK ONE)

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   /X/     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934
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                  FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000
                                       OR

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   / /     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934
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         FOR THE TRANSITION PERIOD FROM ______________TO______________

                         COMMISSION FILE NUMBER 0-24667
                            ------------------------
                       MARKETING SPECIALISTS CORPORATION
                      (F/K/A MERKERT AMERICAN CORPORATION)

             (Exact name of registrant as specified in its charter)

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           DELAWARE                              04-3411833
 (State or other jurisdiction         (IRS Employer Identification No.)
              of
incorporation or organization)
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                       17855 N. DALLAS PARKWAY, SUITE 200
                              DALLAS, TEXAS 75287
                                 (972) 349-6200
               (Address, including zip code and telephone number,
        including area code of Registrant's principal executive office)
                            ------------------------

                            FORMER NAME AND ADDRESS
                          MERKERT AMERICAN CORPORATION
                              490 TURNPIKE STREET
                          CANTON, MASSACHUSETTS 02021
                            ------------------------

        Securities Registered Pursuant to Section 12(b) of the Act: NONE
          Securities Registered Pursuant to Section 12(g) of the Act:
                         COMMON STOCK, $0.01 PAR VALUE
                            ------------------------

    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 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 if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. /X/

    The aggregate market value of the Common Stock of the Registrant held by
non-affiliates of the Registrant on March 15, 2001, based on the closing price
of the Common Stock as registered by the NASDAQ National Market on such date,
was approximately $2,900,000.

    The number of shares of the Registrant's Common Stock and Restricted Common
Stock outstanding as of March 15, 2001 was 25,912,809 and 72,736 respectively.

                   DOCUMENTS INCORPORATED BY REFERENCE: None

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                       MARKETING SPECIALISTS CORPORATION
                           ANNUAL REPORT ON FORM 10-K
                                     INDEX

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           PART I

Item 1.    Business....................................................      4
Item 2.    Properties..................................................     20
Item 3.    Legal and Administrative Proceedings........................     21
Item 4.    Submission of Matters to a Vote of Security Holders.........     21

           PART II

Item 5.    Market for Registrant's Common Equity and Related
             Stockholder Matters.......................................     22
Item 6.    Selected Consolidated Financial Data........................     25
Item 7.    Management's Discussion and Analysis of Financial Condition
             and Results of Operations.................................     26
Item 7A.   Quantitative and Qualitative Disclosures about Market
             Risk......................................................     42
Item 8.    Financial Statements and Supplementary Data.................     43
Item 9.    Changes in and Disagreements with Accountants on Accounting
             and Financial Disclosure..................................     43

           PART III

Item 10.   Directors and Executive Officers of the Company.............     44
Item 11.   Executive Compensation......................................     47
Item 12.   Security Ownership of Certain Beneficial Owners and
             Management................................................     52
Item 13.   Certain Relationships and Related Transactions..............     55

           PART IV

Item 14.   Exhibits, Financial Statement Schedules and Reports on
             Form 8-K..................................................     60
Signatures.............................................................     68
Item 14A.  Index to Consolidated Financial Statements..................    F-1
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                           FORWARD-LOOKING STATEMENTS

    This Annual Report on Form 10-K contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended (the
"Securities Act"), and Section 21E of the Securities Exchange Act of 1934 (the
"Exchange Act"). These statements appear in a number of places including
Item 1. "Business--Industry Overview" and "--Risk Factors", Item 2.
"Properties", Item 3. "Legal Proceedings and Administrative Matters", Item 5.
"Market for Registrant's Common Equity and Related Stockholder Matters", and
Item 7. "Management's Discussion and Analysis of Financial Condition and Results
of Operations". Such statements can be identified by the use of forward-looking
terminology such as "believes", "expects", "may", "estimates", "will", "should",
"plans" or "anticipates" or the negative thereof or other variations thereon or
comparable terminology, or by discussions of strategy. These forward-looking
statements are not guarantees of future performance and are subject to
significant risks and uncertainties that could cause actual results to differ
materially from those projected in the forward-looking statements as a result of
various factors, including risk factors set forth below under "Risk Factors".
This report also identifies other factors that could cause such differences. No
assurance can be given that these are all of the factors that could cause actual
results to vary materially from the forward-looking statements.

                                       3
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                                     PART I

ITEM 1.  BUSINESS

GENERAL

    Marketing Specialists Corporation (formerly Merkert American Corporation,
the "Company", "we," "us" or "our") was incorporated on March 4, 1998, in order
to create a leading food brokerage firm providing outsourced sales,
merchandising and marketing services to manufacturers, suppliers and producers
of food products and consumer goods ("Manufacturers"). The Company acts as an
independent sales and marketing representative, selling grocery and consumer
products on behalf of Manufacturers and coordinating the execution of
Manufacturers' merchandising programs with retailers, wholesalers, mass
merchandisers, supercenters, membership warehouses, drug stores and specialty
food outlets ("Retailers"). The Company's principal source of revenue is
commissions that it receives from Manufacturers. The Company represents more
than 1,600 Manufacturers and more than 128,000 food and non-food stock-keeping
units ("SKUs"), and has business relationships with key Retailers throughout the
United States.

    On December 18, 1998, the Company consummated its Initial Public Offering of
4,400,000 shares of Common Stock (herein so called) at an offering price of
$15.00 per share (the "Offering"). Simultaneously with the Offering, the Company
purchased in separate transactions (collectively, the "Combination") all of the
issued and outstanding capital stock of Merkert Enterprises, Inc., a
Massachusetts corporation ("Merkert") and Rogers-American Company, Inc., a North
Carolina corporation ("Rogers"). As a result, each of Merkert and Rogers became
a wholly-owned subsidiary of the Company. Prior to December 18, 1998, the
Company conducted operations only in connection with the Combination and the
Offering. Effective March 31, 1999, the Company merged its several operating
subsidiaries into one wholly owned subsidiary. References to the Company after
the Combination also include its wholly-owned subsidiaries.

BUSINESS COMBINATIONS AND DIVESTITURES

    Since the beginning of 1999, the Company has completed seven acquisitions,
adding coverage in new geographical markets and expanding representation of
Manufacturers' product offerings within existing markets. The Company's
strategic acquisition plan included the selection, acquisition, and management
of businesses in various brokerage markets, including retail food, food service,
and private label markets. See "Private Label" below.

    SELL.  In January 1999, the Company acquired Sell, Inc. d/b/a The Sell
Group-Cincinnati ("Sell"), a brokerage firm operating in the Midwest region of
the United States. The Company completed the acquisition of Sell for an
aggregate discounted purchase price of approximately $8.5 million, which
included approximately $3.1 million in cash payments, $3.8 million in new debt,
and $1.6 million in assumed debt.

    UBC.  In April 1999, the Company acquired United Brokerage Company d/b/a The
Sell Group-Grand Rapids ("UBC"), a brokerage firm operating in the Midwest
region of the United States. The Company acquired UBC for an aggregate
discounted purchase price of approximately $6.7 million, which included
approximately $1.0 million in cash payments, $3.3 million in new debt, and
$2.4 million in assumed debt.

    BUCKEYE.  In July 1999, the Company acquired Buckeye Sales and Marketing
d/b/a The Sell Group-Cleveland ("Buckeye"), a brokerage firm operating in the
Cleveland, Ohio; Pittsburgh, Pennsylvania; and upstate New York markets. The
Company acquired Buckeye for an aggregate discounted purchase price of
approximately $5.0 million, which included approximately $0.1 million in cash
payments, $3.4 million in new debt, and $1.5 million in assumed debt.

                                       4
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    RMSI.  On August 18, 1999, the Company merged with Dallas, Texas-based
Richmont Marketing Specialists Inc. ("RMSI"), one of the largest food brokers in
the United States (the "Merger"). The Company completed the Merger for an
aggregate discounted purchase price of approximately $236.8 million, which
included approximately $3.4 million in cash payments, $170.0 million in assumed
debt, and $63.4 million in Common Stock and options. Under the terms of the
Merger, RMSI stockholders received 6,705,551 shares of Common Stock. The Company
also granted certain RMSI stockholders and employees options to purchase 800,000
in additional shares of Common Stock at a price equal to $13.50 per share.
Immediately following the Merger, the Company amended its certificate of
incorporation to change its corporate name to "Marketing Specialists
Corporation".

    Prior to the Merger, RMSI pursued consolidation opportunities within the
food brokerage industry. RMSI's strategy was to complete acquisitions in areas
where it did not currently operate to better service its Manufacturers and
Retailers. Since the beginning of 1997, RMSI acquired, among others, Tower
Marketing, Inc. ("Tower") and Atlas Marketing Company, Inc. ("Atlas"), for total
consideration of approximately $14.4 million and $45.7 million, respectively.
Tower served Manufacturers and Retailers primarily in Texas. Atlas was based in
Charlotte, North Carolina, and served Manufacturers and Retailers primarily in
the Southeast and mid-Atlantic regions of the United States. In April 1999, RMSI
acquired Timmons-Sheehan, Inc. d/b/a The Sell Group--Minneapolis
("Timmons-Sheehan") for an aggregate purchase price of approximately
$3.7 million, which included approximately $1.7 million in cash payments and
$2.0 million in new and assumed debt. Prior to the acquisition, Timmons-Sheehan
served Manufacturers and Retailers in Minnesota, Wisconsin, Iowa, the Dakotas,
and Nebraska.

    INMAN.  In October 1999, the Company acquired Paul Inman Associates, Inc.
("Inman"), a brokerage firm operating in the Midwest region of the United
States. The Company completed the acquisition of Inman for an aggregate
discounted purchase price of approximately $14.0 million, which included
approximately $9.8 million in cash payments, $1.0 million in new debt, and
$3.2 million in assumed debt.

    JOHNSON-LIEBER.  On January 27, 2000, the Company acquired
Johnson-Leiber, Inc. ("Johnson-Leiber"), a brokerage firm operating in the
Seattle, Washington; Spokane, Washington; Portland, Oregon; Billings, Montana;
and Anchorage, Alaska markets. The Company acquired Johnson-Leiber for an
aggregate discounted purchase price of approximately $10.2 million, which
included approximately $3.2 million in cash payments and $7.0 million in new
debt and other incentives.

    SALES FORCE.  On April 14, 2000, the Company acquired the Sales Force
Companies, Inc. ("Sales Force"), a full service brokerage firm operating in the
Central Region of the United States. The Company acquired Sales Force for an
aggregate discounted purchase price of approximately $18.8 million, which
included approximately $6.1 million cash payments, $7.8 million in new debt, and
$4.9 million in assumed debt.

    PRIVATE LABEL.  In 2000, the Company decided to exit the Private Label
business. On July 31, 2000, the Company signed a letter of intent to sell its
Private Label business, known as Buy Sell, to Woodland Partners. On January 19,
2001, the Company completed the sale of Buy Sell to Woodland Partners. See
Note 20 of the Company's Notes to Consolidated Financial Statements for
additional information.

    As of December 31, 2000, the Company had 76 offices servicing Retailers
throughout the United States. In 2000 and 1999, the Company had revenues of
approximately $380.8 million and $246.6 million, respectively. In 1999, the
Company had pro forma combined revenues of approximately $379.6 million and pro
forma combined net loss of approximately $(22.3) million (giving effect to the
Merger only), exclusive of the estimated effects of the integration activities
and the elimination of

                                       5
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certain nonrecurring charges. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations."

INDUSTRY OVERVIEW

    Food brokers are sales agencies that offer sales, marketing, merchandising
and order management services to Manufacturers and Retailers. Food brokers are
generally paid by Manufacturers on a percentage of product sales made to
Retailers. Sales of Manufacturers' products are primarily made through grocery
stores operated by Retailers. Manufacturers use food brokers as an alternative
to a direct sales force and rely on food brokers to provide local market
penetration, integrated brand and category management and access to local
merchandising data. The services provided by food brokers enable Retailers to
more efficiently source products from multiple Manufacturers and benefit from
food brokers' merchandising and promotional expertise and knowledge of local
market conditions.

    Over the past ten years, the entire food distribution chain, including
Manufacturers, Retailers and food brokers, has been consolidating. Many
companies in the food brokerage industry, including the Company, have
participated in the trend toward consolidation by acquiring other food brokerage
businesses. The Company believes that the consolidation of food brokers is
primarily driven by the attempt of Manufacturers and Retailers to manage their
businesses more efficiently and effectively by reducing the number of food
brokers with which they must interact within a given region. The Company
believes that consolidation within the food brokerage industry is being driven
additionally in part, by the consolidation of Retailers and Manufacturers and
the increasing demand for the application of more sophisticated information
technology on the part of food brokers. Retail food brokers represent
approximately 7,000 Manufacturers that sell to approximately 150,000 retail
outlets, including chain and independent supermarkets, convenience stores,
wholesale clubs and other outlets and more than 100 wholesalers nationwide. The
industry includes the following three types of food brokers:

    RETAIL FOOD BROKERS.  Manufacturers of branded food and non-food products
use retail food brokers as a cost effective alternative to a direct sales force.
They rely on retail food brokers to provide local market penetration, integrated
brand and category-management and access to local merchandising data. Retail
food brokers provide a full array of these services and generally earn
commissions of approximately 3% of the Manufacturer's net sales to Retailers.
Retail food brokers typically perform two types of services on behalf of
Manufacturers: headquarter functions and retail store functions.

    Headquarters functions include services provided at the headquarters level
to both Manufacturers and Retailers. At this level, retail food brokers conduct
business development activities, on behalf of Manufacturers, including sales
calls and new product introductions to Retailers. Retail food brokers also
assist Manufacturers in developing, reviewing and executing annual marketing
plans. Other headquarters services include order management, supervision of
shelf space management, coordination of Manufacturers' promotional spending, and
assistance with the resolution of billing issues between Manufacturers and
Retailers. Additionally, retail food brokers assist Retailers at the
headquarters level by gathering and analyzing demographic, consumer and store
sales information.

    Retail store functions include all of the services and activities necessary
at the store level for the execution of the Manufacturers' sales plans. These
sales plans are executed by retail food brokers through merchandising, shelf and
display management, new store set-ups, implementation of promotional plans, and
placement of point-of-sale coupons, signs and other promotional information.
Retail food brokers also assist Retailers with coupon and advertising programs,
quality assurance and technical training, primarily in relation to prepared
food. In addition, retail food brokers collect and analyze retail sales data,
which they use to assist Retailers and Manufacturers in maximizing sales.

    FOOD SERVICE.  Food service providers include operators of restaurants,
school and hospital cafeterias and other similar institutional establishments.
The food service business also includes

                                       6
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prepared meals sold at convenience stores. Food brokers sell Manufacturers'
products to food service providers through a number of means, including
headquarters sales calls and the representation of Manufacturers' products at
trade shows.

    PRIVATE LABEL FOOD BROKERS.  Private label food brokers work with
Manufacturers to develop and manage private label programs on behalf of
Retailers. These programs supply products to Retailers which are labeled with a
Retailer's own brand. A food broker's responsibilities in connection with a
private label program may include procurement, inventory management and in-store
delivery of private label products. During 2000, the Company implemented a plan
to eliminate this segment of the business. On July 31, 2000, the Company signed
a letter of intent to sell its Private Label business, known as Buy Sell, to
Woodland Partners. On January 19, 2001, the Company completed the sale of Buy
Sell to Woodland Partners. See Note 20 of the Company's Notes to Consolidated
Financial Statements for information regarding discontinued operations related
to the Private Label segment.

COMPANY STRATEGY

    The Company's objective is to be a leading national provider of outsourced
sales, merchandising and marketing services to Manufacturers, Retailers and food
service providers throughout the United States. To achieve this objective, the
Company seeks to increase its representation of existing Manufacturers' product
lines in new geographic markets and non-grocery trade channels, including mass
merchandisers, food service providers, membership warehouses, drug stores and
convenience stores and by attracting new Manufacturers to the Company.

    The Company intends to implement its overall strategy through the following
measures:

    INCREASE CUSTOMER COVERAGE.  The Company believes that the number of
Retailers who capture the majority of the supermarket sales should continue to
decline due to consolidation in the industry. By positioning itself as a leader
in North America, the Company believes it will be able to both maintain current
Retailer relationships and expand its Retailer base as a result of future
Retailer consolidations. The Company is also seeking to enhance its Retailer
base through its Channel Marketing Division by further developing relationships
with mass merchandisers, membership warehouses, and drug stores.

    DEVELOP MANUFACTURER RELATIONSHIPS AND EXPANSION STRATEGY.  The Company
believes that its base of Manufacturer relationships will continue to increase,
both through expansion of existing relationships and by attracting new
Manufacturers that recognize the Company's ability to provide a wide range of
marketing services on both a broad geographic and a local basis at a cost lower
than Manufacturers would be able to attain with their own sales forces. The
Company continues to seek expanding penetration of its existing Manufacturers'
product lines into new geographic markets and non-grocery trade channels,
including mass merchandisers, membership warehouses, drug stores and convenience
stores.

    HYBRID SERVICES.  The Company typically provides Retailers with a full range
of account, retail, marketing and order management services for which it
receives commissions from Manufacturers based on a percentage of product sales
made to Retailers. The Company also has "hybrid" agreements, generally with
Manufacturers that did not previously use a food broker's services, under which
the Company provides only specified retail services for fees based on the
services provided. The Company believes that such Manufacturers are moving
toward outsourcing retail services at the store level in order to eliminate the
significant expense associated with the maintenance of their own in-store retail
representatives. With this in mind, the Company created the new In-Source
Specialists Division ("ISS") to handle such needs. ISS will provide the
additional personnel required for specific initiatives in a timely and efficient
manner.

    The Company anticipates that ISS will position the Company to take advantage
of this growing trend due to the Company's broad geographic coverage and
knowledge of local markets. Although

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hybrid agreements currently do not represent a significant portion of the
Company's revenue, the Company believes that hybrid agreements will, in the
future, generate substantial revenue and operating profits and may attract new
Manufacturers, who may later expand their use of the Company's services.

    MARKETING SERVICES.  The Company seeks to utilize its marketing expertise
and information technology to develop and implement targeted consumer sales
promotions for its Manufacturers' products. The Company also plans to continue
to deploy category analysts who use local sales data to assist Retailers with
shelf schematics, category layouts and total store space management.

    ACHIEVE COST SAVINGS.  During its expansion phase, the Company reduced its
operating overhead at acquired companies by eliminating duplicative personnel,
operating expenses and facilities. The Company intends to continue its plan of
consolidation of various management, sales and order entry functions to benefit
from further operating efficiencies.

SERVICES AND OPERATIONS

    The Company has traditionally provided Manufacturers with a full array of
sales, marketing and administrative services and has been paid a commission by
Manufacturers. In certain cases, the Company has entered into "hybrid"
arrangements with Manufacturers under which the Company provides less than full
geographic coverage and services. The functions and services provided by the
Company are described below:

    FULL SERVICES.  The Company currently provides full brokerage services to
most of the Manufacturers that it represents. These Manufacturers generally pay
the Company a commission of approximately 3% of the Manufacturer's net sales to
Retailers. In general, our business managers service Manufacturers under these
arrangements. Our managers, customer service personnel and support staff utilize
information collected and developed by the Company to assist Manufacturers in
devising strategic sales plans and achieving merchandising goals. In addition,
the Company uses retail information to develop customized marketing strategies.
These strategies include a determination of the optimum mix of current and new
products to be offered and the type of promotions needed to increase revenues
and profitability. These services accounted for approximately 92% of the
Company's revenues for 2000.

    The Company also handles both order and certain billing management services
for Manufacturers. The Company's order management system enables it to perform
all major functions relating to orders for goods from Retailers to
Manufacturers.

    The Company's category management analysts and shelf space management
analysts link the Company, its business managers and Manufacturer teams with
Retailer teams. These Retailer teams are comprised of headquarters account
managers and retail merchandisers. These analysts develop information from
retail data collected by the Company's Retailer teams and by outside sources,
including A.C. Nielson Corp. and Information Resources, Inc. Business managers
use this information in developing strategies with Manufacturers. The Retailer
teams use this knowledge, as well as store-specific sales and demographic
information provided by the analysts, to implement sales and merchandising
strategies at the local store level.

    Headquarters account managers help execute sales plans developed by business
managers and Manufacturers. The Company's retail merchandisers develop
relationships with store managers and in-store category managers and assist
headquarters account managers in executing sales plans for Manufacturers'
products. The Company's retail merchandisers execute sales plans at the store
level by providing shelf and display management, new store set-ups, stocking of
new items and placement of point-of-sale coupons and signs.

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    CHANNEL MARKETING.  The Company has developed its channel marketing division
in response to the rapidly growing trend of non-grocery outlets, particularly
mass merchandisers, super centers, membership warehouses, drug stores and
specialty food outlets. This division's primary focus is to support Retailers to
ensure Manufacturers' products are available to the consumers at the point of
purchase. Scan data is utilized to identify retail problems, which are then
communicated to the Company's field merchandisers for correction. In addition,
store specific consumer demographics information is also utilized to support
targeted merchandising programs. The Company's channel marketing division
presently accounts for approximately 6% of the Company's revenues for 2000.

    HYBRID SERVICES.  In response to increasing demand from certain
Manufacturers that outsource only a portion of their retail services functions,
the Company instituted the use of "hybrid" agreements. Under these agreements,
the Company provides only the limited services, geographic coverage and/or
Retailer coverage specified by the agreement. Providing retail-only services is
a common hybrid arrangement. Retail-only services primarily include initial
retail shelf set-ups and subsequent store shelf space management. These services
generally provide for compensation equivalent to a commission of approximately
2% of the value of product sales to the Retailer.

    IN-SOURCE SPECIALISTS DIVISION.  The Company is also expanding its services
to include a new In-Source Specialists ("ISS") Division, which will serve as an
arm of the Company's existing Retail Division. Designed to accommodate
increasing demand for projects exceeding the time frame of standard category
management, ISS will provide Manufacturers and Retailers with the additional
personnel required to complete such initiatives in a timely and efficient
manner. ISS is comprised of an internal, cross-functional team of Company
associates who specialize in maximizing returns on non-budgeted projects and
surge work requested by Manufacturers. Income derived from providing additional
manpower required to complete special initiatives will be incremental to
existing contractual agreements between the Company and its Manufacturer
partners.

    DRUG DIVISION.  In addition to current coverage in the mass, club,
convenience, and specialty outlets, Marketing Specialists' now provides
continuity coverage in some 15,000 retail drug outlets through the new Retail
Drug Division. Nestle is the initial principal partner for the new venture.

    PRIVATE LABEL.  The Company's private label division develops, procures, and
manages inventory of private label products, including frozen fruits and
vegetables and other products on behalf of certain Retailers. See Note 20 of the
Company's Notes to Consolidated Financial Statements for information regarding
discontinued operations related to the Private Label segment.

    STORE SUPPLIES.  The Company's store supplies division operates as a
distributor for Monarch Marking Systems, Inc., selling price marking equipment,
labels and other related store supplies to Retailers in New England and
metropolitan New York City. In addition, the Company sells a bio-degreaser
product to Retailers' supermarket meat and bakery departments, restaurants and
other food service customers directly and through local distributors. See
Note 20 of the Company's Notes to Consolidated Financial Statements for
information regarding discontinued operations related to the Private Label
segment.

SEASONALITY

    The Company has experienced and expects to continue to experience
fluctuations in quarterly revenues and operating results as a result of seasonal
patterns. The revenues of the Company have been stronger in the third and fourth
calendar quarters as a result of historically strong sales associated with
consumer consumption during the holiday season and weaker in the first calendar
quarter following such season. Results of operations for any particular quarter
therefore are not necessarily indicative of the results of operations for any
future period. Future seasonal and quarterly fluctuations could have a material
adverse effect on the Company's business, financial condition and results of

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operations. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations."

MANAGEMENT INFORMATION SYSTEMS

    The application of information technology has become an increasingly
important service in the food brokerage industry. The Company has followed this
trend by investing in information technology.

    ELECTRONIC DATA INTERCHANGE.  The Electronic Data Interchange ("EDI") was
developed to streamline order communications between food brokers, Manufacturers
and Retailers. Orders sent by EDI are transmitted on-line from Retailers to the
Company and entered automatically into the Company's order databases. Orders are
reviewed by the Company to verify that quantities, product codes, pricing, pack
sizes and promotions have been correctly submitted. The Company then places
orders with certain Manufacturers via EDI. By reducing manual effort, the system
curtails order input errors, expedites order processing and reduces the number
of personnel required to fulfill this function. Currently, a majority of all of
the Company's Manufacturers utilizes EDI, including 60% of the Company's entire
Manufacturer base and 70% of our retailer base.

    DISASTER RECOVERY/ORDER ENTRY.  Marketing Specialists has implemented a
fully fault tolerant disaster recovery plan for our more than 25,000 orders
processed per day. We have two primary data centers in Charlotte, North Carolina
and Dallas, Texas. The two sites are connected with multiple and redundant
T-1's, with full database replication. If one site is out of service for any
reason the entire country will be switched to run off the other center. This
guarantees that our customers orders will be processed securely and reliably no
mater what the situation. The architecture used is two identical Hewlett Packard
N/4000's and a terabyte of EMC disk storage on each.

    DOCUMENT IMAGING.  We have implemented a document imaging and critical
records archiving system. With this system our corporate headquarters and field
offices have the most current documents at their fingertips. This system has
increased production, communication, and employee effectiveness for both
corporate and field offices.

    WEB TECHNOLOGY.  The Company uses a wide area network to provide on-line
information to Manufacturers and Retailers. The Company utilizes the Internet
and dedicated extranets to disseminate information and communicate with
Manufacturers in a highly secure manner. The Company currently has 32 extranets
with ten additional extranets in development. Retailers and Manufacturers using
the Company's on-line service may access marketing, sales, new item
introduction, store conditions and other information related to their products
and operations. The Company's intranet has become a major tool in communicating
with its employees by allowing the Company to provide its employees with
policies and procedures, human resource forms, and other valuable information.
The Company's Internet site located at www.mssc.com allows the Company to market
its services to potential Manufacturers and Retailers.

    RETAIL INFORMATION.  The Company utilizes an advanced retail reporting
system called RW3 Enterprise ("RW3") to provide Manufacturers with current
in-store data regarding their products. RW3's web-centric solutions link today's
information directly with end users. Functionality is delivered directly via the
Internet allowing access to current information from anywhere in the world using
a web browser. RW3 provides a powerful proven solution for integrating field and
headquarters sales teams, combining Windows CE-Registered Trademark- or computer
telephone technology for the in-store sales representative data capture
activities and web access to reporting in any format appropriate for management.
The Company's current system makes information easier to access resulting in
huge cost reductions, enabling more effective and targeted sales and services
and ultimately improving customer satisfaction and profitability.

                                       10
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    PEOPLESOFT-REGISTERED TRADEMARK-.  The Company utilizes a software
application commonly referred to as "PeopleSoft-Registered Trademark-."
PeopleSoft-Registered Trademark- is used for financial systems including
treasury, accounts payable, accounts receivable, budget, general ledger, as well
as human resources and payroll. PeopleSoft-Registered Trademark- allows the
Company to keep sales, expense and related data in one location. All of the
other systems installed at the Company use PeopleSoft-Registered Trademark- as a
base for all data. Since the consummation of the Merger, the Company has
benefited from its use of PeopleSoft-Registered Trademark- in connection with
the Company's acquisition of other entities and integration of the acquired
entities' finance, human resources and payroll departments. The flexibility of
the software allows the systems of the acquired companies to be more easily
converted to the Company's systems.

    NETWORKS AND DATA COMMUNICATIONS.  The Company utilizes redundant frame
relay for connectivity to all of its branches. This provides a secure, and
reliable method of data communications between all of our offices, including
e-mail, Internet access, file sharing, order entry,
PeopleSoft-Registered Trademark-, and many other processes. Our wide area
network is monitored around the clock and is secured through CheckPoint
firewalls. The Company utilizes Cisco routers and VisNet data service units
("DSUs") for bandwidth information, packet information and tracking. A virtual
private network ("VPN") is provided for all remote users.

    TELECOMMUNICATIONS.  The Company utilizes a national voice mail system for
the routing of messages from office to office. This allows us to communicate
more effectively across all offices instantaneously. We also utilize digital
paging and cellular technology for users who travel.

COMPETITION

    Despite the trend toward consolidation, the food brokerage market is large
and fragmented, with many small brokers serving numerous local markets and a few
large brokers serving multiple regions in the United States. The Company
competes with other food brokers for product lines of Manufacturers and
Retailers. Competition is based primarily on breadth of geographic coverage and
the level of services provided.

    The entire food distribution chain, including Manufacturers, Retailers and
food brokers, has been consolidating over the past ten years. As the market
becomes more concentrated in terms of the total number of Manufacturer and
Retailer accounts served by food brokers, the Company believes large brokers
that can provide a full array of services to leading Manufacturers and Retailers
across geographic markets have a competitive advantage. Accordingly, the Company
expects that Manufacturers and Retailers will favor large regional and national
food brokers having the resources to invest in the personnel and technology
necessary to operate in an increasingly sophisticated and complex environment,
while continuing to provide the local market focus required by Manufacturers and
Retailers.

    The Company is one of the leading food brokers in the United States, with
operations across the country. The Company competes with other national and
multi-regional food brokers, including Advantage Sales, Crossmark and Acosta
Sales Co., Inc. In addition, the Company competes with third-party merchandising
companies and other retail services providers.

EMPLOYEES

    The Company has approximately 5,800 employees, including approximately 4,600
full-time employees and 1,200 part-time employees. None of the Company's
employees is a union member, and the Company and its employees have not entered
into any collective bargaining agreements. The Company has not experienced any
work stoppages or strikes. The Company believes that it has good relations with
its employees.

                                       11
<PAGE>
FINANCIAL INFORMATION ABOUT SEGMENTS, FOREIGN AND DOMESTIC OPERATIONS AND EXPORT
  SALES

    The Company historically operated in two principal business segments: Food
Brokerage and Private Label, principally in the United States. On July 31, 2000,
the Company signed a letter of intent to sell its Private Label business, known
as Buy Sell, to Woodland Partners. On January 19, 2001, the Company completed
the sale of Buy Sell to Woodland Partners. See Note 20 of the Company's Notes to
Consolidated Financial Statements for information regarding discontinued
operations related to the Private Label segment.

AVAILABLE INFORMATION

    The Company files annual, quarterly, and special reports, proxy statements
and other information with the Securities and Exchange Commission (the "SEC").
You may read and copy any documentation the Company files at the SEC's Public
Reference Room at 450 Fifth Street, N.W., Washington D.C. 20549. Please call the
SEC at 1-800-SEC-0330 for further information on the Public Reference Room. SEC
filings are also available to the public at the SEC's web site at
http://www.sec.gov.

                                       12
<PAGE>
                                  RISK FACTORS

    The following risk factors should be carefully reviewed in addition to other
information in this Annual Report on Form 10-K. This Annual Report on Form 10-K
contains, in addition to historical information, forward-looking statements that
involve risks and uncertainties. The Company's actual results could differ
significantly from the results discussed in the forward-looking statements.
Factors that could cause or contribute to such differences include those risk
factors set forth below as well as those factors discussed elsewhere in this
Annual Report on Form 10-K.

ABILITY TO CONTINUE AS A GOING CONCERN

    The Company has suffered recurring operating losses and negative operating
cash flows and had negative working capital as of December 31, 2000. During 2000
and the first quarter of 2001, the Company has received funds from a related
party for working capital purposes. These matters raise substantial doubt about
the Company's ability to continue as a going concern. See Note 2 of the
Company's Notes to Consolidated Financial Statements for further discussion.

SUBSTANTIAL LEVERAGE

    The Company has and will continue to have a significant amount of
indebtedness. The degree to which the Company is leveraged could have
significant consequences, including the following:

    - The Company's ability to obtain additional financing in the future for
      working capital, capital expenditures, acquisitions or general corporate
      purposes may be impaired.

    - A substantial portion of the Company's cash flows from operations must be
      dedicated to the payment of interest and principal on its indebtedness,
      thereby reducing funds available to the Company for other purposes.

    - The agreements governing the Initial Credit Facility, the Amended Term
      Loan, the New Revolver, the First Union Amended Credit Agreement, and the
      Amended Credit Agreement (each as defined below) contain certain
      restrictive financial and operating covenants that may impact the
      Company's operations and ability to meet its obligations. The Company has
      been in violaion of these covenants from time to time, requiring waivers
      and/or amendments to covenants and facilities.

    - The Company's degree of leverage may limit its flexibility to adjust to
      changing market conditions, reduce its ability to withstand competitive
      pressures and make it more vulnerable to a downturn in general economic
      conditions or its business.

    - If the Company's cash flows and capital resources are insufficient to fund
      its obligations, the Company may be forced to sell its assets, seek
      additional equity or debt capital or restructure its debt. The Company
      cannot guarantee that its cash flows and capital resources will be
      sufficient for payment of interest and principal on its debt in the
      future.

    See "Management's Discussion and Analysis of Financial Condition and Results
of Operations--Liquidity and Capital Resources."

    The Company has unsecured long-term obligations to related parties of
approximately $44.7 million as of December 31, 2000. These obligations bear
interest ranging from 6.00% to 10.125%. Principal and interest payments are due
under various arrangements over terms ranging from one to thirteen years. A
total of approximately $25.1 million of these obligations represents amounts due
to either MS Acquisition Limited, the Company's largest stockholder ("MS
Acquisition"), or an affiliate of MS Acquisition.

                                       13
<PAGE>
    SENIOR SUBORDINATED NOTES

    In December 1997, concurrently with the sale by RMSI of $100.0 million of
10 1/8% Senior Subordinated Notes due 2007 (the "Issued Notes"), RMSI entered
into an Exchange and Registration Rights Agreement with the initial purchaser of
the Issued Notes. Under the terms of that agreement, RMSI agreed to file a
registration statement regarding the exchange of the Issued Notes for new notes
registered under the Securities Act, and to offer the holders of the Issued
Notes an opportunity to exchange their unregistered notes for registered notes.

    On June 21, 1999, RMSI filed a Registration Statement on Form S-4 with the
SEC to register $100.0 million of new notes (the "Registered Notes").
Subsequently, RMSI completed an exchange of the Issued Notes for the Registered
Notes. The Registered Notes are identical in all material respects to the Issued
Notes, except for transfer restrictions and registration rights. The Company
assumed this outstanding indebtedness in connection with the Merger.

    The Registered Notes are unsecured and are subordinated in right of payment
to all existing and future senior indebtedness of the Company. The Registered
Notes are fully and unconditionally guaranteed on an unsecured, senior
subordinated, joint and several basis by certain guarantor wholly-owned
subsidiaries of the Company as defined in the Registration Statement, which
comprise substantially all the direct and indirect subsidiaries of the Company.
The Company is a holding company with no assets, liabilities or operations other
than its interests in its subsidiaries. Separate financial statements and other
disclosures for such subsidiaries have not been presented due to management's
determination that such information is not material to investors.

    Interest on the Registered Notes is payable semiannually on June 15 and
December 15 of each year, commencing June 15, 1998. The principal on the
Registered Notes is payable on December 15, 2007, the maturity date. The Company
may not redeem the Registered Notes prior to December 15, 2002, except as
described below. On or after such date, the Company may redeem the Registered
Notes, in whole or in part, at the following redemption prices: 2002--105.063%;
2003--103.375%; 2004--101.688%; 2005 or thereafter--100.000%, together with
accrued and unpaid interest, if any, to the date of redemption. The Registered
Notes are not subject to any sinking fund requirement. Upon a change of control,
as defined (not triggered by the Merger), each holder of the Registered Notes
will have the right to require the Company to make an offer to repurchase such
holder's Registered Notes at a price equal to 101% of the principal amount
thereof, together with accrued and unpaid interest, if any, to the date of
repurchase.

    The Registered Notes subject the Company to certain limitations and
restrictions primarily related to obtaining additional indebtedness, payment of
dividends, and sales of assets and subsidiary stock, which may require the
consent of the holders of the Registered Notes.

    In December 2000, the rating of the Registered Notes was lowered to CCC-.
Based on recent trading information, the fair value of the Registered Notes is
approximately $11.3 million, as compared to a carrying value of $100.0 million.

    CONSENT SOLICITATION

    During the first quarter of 2000, the Company refinanced and increased its
existing senior credit facilities from approximately $68.0 million to
$85.0 million. Because the Company's Indenture relating to the Registered Notes
restricted the Company's ability to incur bank indebtedness in excess of
$25.0 million, the Company had to solicit and obtain the consent of holders
representing at least 51% of the Registered Notes to the refinancing. On
March 28, 2000, the Company distributed consent solicitation statements to all
of the holders of the Registered Notes for the purpose of seeking the required
consent to the increase in bank debt and certain other matters. The Company
received consent from a majority of the holders of the Registered Notes. In
exchange for the consent to the

                                       14
<PAGE>
refinancing and other proposed amendments, the holders were paid a consent fee
of $2.0 million in cash. The Company also paid a fee of $0.5 million to Chase
Securities Inc. for its services as solicitation agent.

    INITIAL CREDIT FACILITY

    In connection with the Offering and Combination, the Company obtained a
$75.0 million Credit Facility (as amended on August 18, 1999) from a bank (the
"Initial Credit Facility"). The Initial Credit Facility consisted of a
five-year, secured, fully amortizing $50.0 million term loan (the "Initial Term
Loan") and a three-year, secured $25.0 million revolving line of credit (the
"Initial Revolving Credit"). The balance outstanding under the Initial Credit
Facility was $64.1 million as of December 31, 1999 ($20.3 million under the
Initial Revolving Credit and $43.8 million under the Initial Term Loan). Amounts
outstanding under this facility were collateralized by substantially all of the
Company's assets.

    Interest was payable on the Initial Term Loan and the Initial Revolving
Credit at the base rate, as defined in the amended Initial Credit Facility. The
rate on the outstanding balance of the Revolver and the Initial Term Loan was
9.16% and 10.50%, respectively, as of December 31, 1999. The Initial Credit
Facility required the Company to make certain mandatory prepayments of amounts
outstanding under the Initial Credit Facility with the use of certain proceeds
from asset sales and debt and equity financing.

    The amended Initial Credit Facility required the Company to comply with
various affirmative and negative covenants, including the following, among
others:

    - the maintenance of certain financial ratios

    - restrictions on certain additional indebtedness

    - restrictions on liens, guarantees, dividends and the disposition of assets

    - obtaining the lenders' consent to acquisitions involving cash
      consideration in excess of a specified amount

    AMENDED TERM LOAN

    On March 30, 2000, the Company became a party to a Second Amended and
Restated Credit Agreement among the Company and First Union National Bank, N.A.
as agent and the lenders named therein (the "Amended Term Loan"). The Amended
Term Loan consisted of a two-year, secured $35.0 million term loan. The Company
paid commitment and other fees of approximately $0.9 million in connection with
obtaining the Amended Term Loan. Under the Amended Term Loan, the principal
amount of the term loan was reduced from $43.8 million to $35.0 million.

    The Amended Term Loan was secured by a lien on substantially all of the
Company's and its subsidiaries' tangible and intangible property. In addition,
the Amended Term Loan was jointly and severally guaranteed by all current and
future subsidiaries of the Company. Interest was payable on the Amended Term
Loan at a rate based on one of two customary interest rates plus an additional
interest margin of 375 or 500 basis points, as applicable.

    The Amended Term Loan contained customary events of default, including
cross-default provisions related to the Registered Notes.

    In connection with the Amended Term Loan, the Company issued to an affiliate
of First Union National Bank, N.A. detachable warrants to purchase up to 4.0% of
the Company's Common Stock on a diluted basis. The exercise price of the
warrants will be nominal, and the warrants will be exercisable at any time after
the second anniversary of the issuance of the warrants. The proceeds of the
Amended Term Loan were allocated between debt and warrants based on their
respective fair market values. The

                                       15
<PAGE>
estimated fair value of the warrants appears as a component of Additional
Paid-In Capital in the accompanying Consolidated Balance Sheet as of
December 31, 2000.

    The letter of credit outstanding under the Initial Credit Facility was
replaced by a $1.1 million letter of credit issued for the account of RCPI,
which is an affiliate of MS Acquisition. The Company issued to RCPI a
reimbursement note subordinated in right of payment to the Registered Notes in
the amount of the letter of credit. The promissory note will become payable if
the letter of credit is drawn.

    NEW REVOLVER

    On March 30, 2000, the Company also became a party to a Credit Agreement
among the Company, certain of its subsidiaries, and The Chase Manhattan Bank,
N.A., as agent, and the lenders named therein (the "New Revolver," and together
with the Amended Term Loan, the "New Senior Credit Facility"). The New Revolver
consisted of a two-year, senior secured $50.0 million revolving line of credit,
subject to a borrowing base equal to a specified percentage of eligible
receivables. The Company paid commitment and other fees of approximately
$0.6 million in connection with obtaining the New Revolver. Funds advanced under
the New Revolver were used by the Company to repay a portion of outstanding
amounts under the Initial Credit Facility, to partially finance the acquisition
of Sales Force, to finance the Company's working capital and capital expenditure
requirements in the ordinary course of business, and to pay fees and expenses
relating to the closing of the New Senior Credit Facility. The New Revolver
contained customary events of default, including cross-default provisions
related to the Registered Notes.

    The New Revolver was secured by a first priority security interest in cash,
cash equivalents, accounts receivable and inventory of the Company and its
subsidiaries and proceeds thereof but not in assets that are the proceeds of
equipment, fixtures, real estate, intellectual property or the stock of
subsidiaries. In addition, Inman, Marketing Specialists Sales Company ("MSSC")
and Bromar, Inc. ("Bromar," a California corporation and a wholly owned
subsidiary of MSSC) were co-borrowers under the New Revolver, jointly and
severally liable for all borrowings and other related obligations thereunder.
Interest was payable on the New Revolver at a rate based on one of two customary
interest rates plus an additional interest margin ranging from 150 to 350 basis
points. The applicable margin was determined based on certain financial ratios
of the Company.

    The New Senior Credit Facility required the Company to comply with various
affirmative and negative covenants, including, among others:

    - the maintenance of certain financial ratios

    - restrictions on additional indebtedness

    - restrictions on liens, guarantees, dividends and the disposition of assets

    - restrictions on certain mergers, consolidations and acquisitions

    FIRST UNION AMENDED CREDIT AGREEMENT

    On November 17, 2000, the Company became party to a First Amendment to the
Credit Agreement among the Company, certain of its subsidiaries as guarantors,
and First Union National Bank, N.A. as agent (the "First Union Amended Credit
Agreement"). The First Union Amended Credit Agreement amends the Amended Term
Loan and provides for the consent of First Union National Bank, N.A. to the
Increase (as defined below), the Borrowing Base Amendment (as discussed below),
and the repayment of the $2.5 million promissory note (as discussed below) to MS
Acquisition. The First Union Amended Credit Agreement also amends the Amended
Term Loan to reflect the terms of the Amended Credit Agreement. At December 31,
2000, the Company was not in compliance

                                       16
<PAGE>
with certain covenants related to this agreement. See "Amended Senior Credit
Facility Amendments" below for discussion of these violations and related
waivers and amendments.

    AMENDED CREDIT AGREEMENT

    On November 17, 2000, the Company became party to an amendment to the Credit
Agreement among the Company, certain of its subsidiaries, The Chase Manhattan
Bank, N.A. as the agent (the "Agent") and the lenders parties thereto (the
"Amended Credit Agreement"). The Amended Credit Agreement provides for an
increase in the maximum amount available under the New Revolver from
$50.0 million to a maximum commitment of $60.0 million (the "Increase"), which
is comprised of a $41.0 million variable commitment (the "Tranche A Note") and a
subordinated $19.0 million fixed commitment (the "Tranche B Note"). MS
Acquisition purchased a 100% participation interest in the Tranche B Note.

    The Tranche A Note provides for a $41.0 million revolving line of credit
(the "Amended Revolver"), which accrues interest at rate equal to the Base Rate
(a reference rate based on the prime rate) plus 2.25%. The Amended Revolver will
revolve up to the lesser of $41.0 million or the Borrowing Base, which is a
function of the Company's eligible receivables and the Advance Percent
determined by the Agent. As part of the Amended Credit Agreement, the Agent has
decreased the Advance Percent, thereby decreasing the Borrowing Base (the
"Borrowing Base Amendment"). The Company must fulfill all payment obligations
under the Amended Revolver before making any interest payments on the Tranche B
Note. The Tranche A Note and any accrued and unpaid interest will mature on
March 30, 2002.

    As a result of the Amended Credit Agreement, the Company had indebtedness of
approximately $48.9 million as of December 31, 2000, which is substantial in
relation to its stockholders' equity, as well as interest and debt service
requirements that are significant compared to its income and cash flows from
operations. The provisions of the Year 2000 credit facility refinancings are
more fully described in "Management's Discussion and Analysis of Financial
Condition and Results of Operations--Liquidity and Capital Resources" and the
accompanying Notes to the Consolidated Financial Statements. The Tranche B
Note bears interest at a rate equal to the Base Rate plus 2.25%. The Tranche B
Note and any accrued and unpaid interest will mature on March 30, 2002. The
fixed commitment under the Tranche B Note is not subject to the Borrowing Base.
As discussed in Note 9 of the Notes to Consolidated Financial Statements, MS
Acquisition funded the $19.0 million balance of the Tranche B Note, subject to
the terms of a master participation agreement. At December 31, 2000, the Company
was not in compliance with certain covenants related to this agreement. See
"Amended Senior Credit Facility Amendments" below for discussion of these
violations and related waivers and amendments.

    AMENDED SENIOR CREDIT FACILITY AMENDMENTS

    As of March 30, 2001, the Company was in violation of certain covenants
under the Amended Credit Agreement and the First Union Amended Credit Agreement
(collectively referred as the "Amended Senior Credit Facility") in connection
with (i) its failure to provide annual financial statements within ninety (90)
days of its fiscal year end, (ii) the certifying accountant's qualification of
the Company's annual financial statements on a going concern basis, and
(iii) the Company's failure to deliver certain items to the Agent by March 15,
2001 as required by the Amended Credit Agreement. On April 19, 2001, the Company
entered into (a) a Waiver and Third Amendment to Credit Agreement amending the
Amended Credit Agreement and (b) Second Amendment to Credit Agreement amending
the First Union Amended Credit Agreement ((a) and (b) collectively defined as
the "Amended Senior Credit Facility Amendments").

                                       17
<PAGE>
    Under the Amended Senior Credit Facility Amendments, the Company
(i) received a waiver for its current defaults under the Amended Senior Credit
Facility and (ii) paid a fee of approximately $0.2 million as consideration in
obtaining the amendments and waiver of the defaults under the Amended Credit
Agreement. The Amended Senior Credit Facility Amendments provide, among other
things, that (i) the Agent may increase the Advance Percent as of March 31,
2001, but before June 1, 2001, thereby increasing the Borrowing Base under the
Amended Senior Credit Facility, (ii) amends the definition of "EBITDA" in the
Amended Senior Credit Facility to include certain write-offs in the amortization
and depreciation expense deducted in determining Net Income, and (iii) amends
the baseline amounts for determining Minimum EBITDA. Under the Amended Senior
Credit Facility Amendments, the Company must meet certain post-closing
covenants, including, among other things, the delivery of its annual financial
statements by April 27, 2001 and the delivery of certain other items by May 31,
2001.

    OTHER NOTES PAYABLE INVOLVING RELATED PARTIES

    The Company also has a mortgage note with RCPI, an affiliate of MS
Acquisition, that is secured by certain land, a building and fixtures. It bears
interest at 8.5% with monthly payments of approximately $34,000 (including
interest) and a balloon payment of approximately $3.6 million due in 2001. The
balance outstanding under this mortgage was approximately $3.6 million as of
December 31, 2000.

    On November 9, 2000, the Company issued a $2.5 million promissory note to MS
Acquisition. This promissory note is subordinate to the senior debt of the
Company. The proceeds were used for general corporate purposes. The
$2.5 million promissory note bears interest at a rate equal to the sum of an
interest margin of 2.75% plus the applicable prime rate on the last business day
of the quarter for which interest is payable. Interest is payable quarterly in
arrears, commencing on December 31, 2000, and will continue through the maturity
date. The $2.5 million promissory note and any unpaid and accrued interest will
be payable on November 9, 2002, or on demand, under specified conditions.

    The Company is not permitted to repay the principal and unpaid and accrued
interest on the $2.5 million promissory note on demand if the Company's
borrowing base 30 days prior to a payment date is not at least $10.0 million, or
25% of the sum of the Company's payroll for the last four consecutive pay
periods, whichever is greater. In the first quarter of 2001, the $2.5 million
promissory note was converted into redeemable convertible preferred stock. See
Note 20 of the Notes to Consolidated Financial Statements for additional
information.

    The Company had other notes payable to former employees of various acquired
entities of approximately $8.5 million as of December 31, 2000. The total
estimated payments have been discounted at rates ranging from 8% to 10%. The
amounts due under the acquisition agreements are unsecured and extend through
2011. These amounts are payable in either monthly or quarterly installments.

    The fair value of these obligations approximates their carrying value.

VOTING CONTROL BY DIRECTORS, EXECUTIVE OFFICERS AND PRINCIPAL STOCKHOLDERS

    As of March 28, 2001, MS Acquisition Limited ("MS Acquisition") beneficially
owns approximately 81.9% of the outstanding shares of Common Stock of the
Company. As the Company's largest stockholder, MS Acquisition is likely to be
able to maintain effective control of the Company, including the ability to
elect a majority of the Board of Directors (the "Board of Directors"). The
ownership by MS Acquisition of shares of Common Stock may discourage or prevent
unsolicited mergers, acquisitions, tender offers, proxy contests or changes of
incumbent management, even when stockholders other than MS Acquisition consider
such a transaction or event to be in their best interest. Accordingly, holders
of Common Stock may be deprived of an opportunity to sell their shares at a
premium over the trading price of the shares. See "Item 12. Security Ownership
of Certain Beneficial Owners and Management".

                                       18
<PAGE>
    As of March 28, 2001, an aggregate of approximately 83.3% of the Company's
outstanding Common Stock is beneficially owned by its directors, executive
officers and affiliates. This percentage ownership gives effect to the exercise
of options to purchase 222,756 shares of Common Stock held by certain of these
individuals, and conversion of the Series B and C Preferred Stock (defined
below). Such concentration of ownership, together, in some cases, with certain
provisions of the Company's Second Amended and Restated Certificate of
Incorporation and Amended and Restated By-Laws and certain sections of the
Delaware General Corporation Law, may have the effect of delaying or preventing
a "change in control" of the Company. See "Anti-Takeover Effect of Certificate
of Incorporation, By-law Provisions and Delaware Law" and "Item 12. Security
Ownership of Certain Beneficial Owners and Management".

HISTORY OF OPERATING LOSSES

    The Company has a history of operating losses. The Company may continue to
experience net losses or may have a greater working capital deficit in the
future. If they persist, the Company may have an increased net loss per share
and the market price of the common stock and the Registered Notes may continue
to decline as a result. The Company's ability to be profitable in the future
will be dependent upon a number of factors, including:

    - the Company's ability to increase revenues by attracting and retaining
      national Manufacturers and Retailers;

    - the Company's ability to realize cost-savings as a result of the
      integration of the acquired companies; and

    - various other extraneous factors, including, without limitation, economic,
      financial and competitive conditions such as the consolidation occurring
      within the food distribution industry.

INTEGRATION OF PRIOR ACQUISITIONS; RISKS ASSOCIATED WITH RAPID GROWTH

    The Company has grown rapidly and has expanded its operations throughout the
United States. This growth is primarily attributed to several large acquisitions
that the Company, or its predecessors, has completed since 1996. The Company
expects to spend significantly less time and effort in identifying acquisition
targets and to focus on integrating prior acquisitions. The Company's inability
to successfully manage its growing business profitably could have a material
adverse effect on the Company's business, financial condition and results of
operations.

    There can be no assurance that the Company's growth strategy will be
successful or that the Company will be able to generate cash flows sufficient to
fund its operations and to support internal growth. The Company's inability to
achieve internal earnings growth or otherwise execute its growth strategy could
have a material adverse effect on the Company's business, financial condition
and results of operations. See "Item 1. Business--Company Strategy".

MANUFACTURER REPRESENTATION CONFLICTS

    The Company represents certain Manufacturers that do not allow the Company
to market and sell their competitors' products in our assigned territories.
Manufacturers can be highly subjective in their definition of a conflict and may
contend that products with a varying degree of similarity are competing
products. In addition, some Manufacturers object to the Company's representation
of other Manufacturers that produce a similar product for sale even though such
representation of the competing Manufacturer is for different geographic regions
or trade channels. The Company is sensitive to potential conflicts and must
exercise care in determining how to resolve conflicts and potential conflicts as
new food broker businesses are acquired and as Manufacturers continue to grow,
merge and expand into new product categories and geographic areas. The Merger
has resulted in certain Manufacturer conflicts, particularly where the
operations of the Company and RMSI overlapped. The Company may be required, in
order to resolve a conflict, to represent particular lines or products in lieu
of others, and the Company may not select the lines of products that are
ultimately

                                       19
<PAGE>
the most successful. The inability of the Company to resolve or deal with
Manufacturer representation conflicts or potential conflicts could have a
material adverse effect on the Company's business, financial condition and
results of operations.

SHORT TERM AGREEMENTS

    A majority of the Company's contracts with its Manufacturers have 30-day
terms. As a result, the Manufacturers can transfer their business to another
food broker upon short notice. While the Company has long-term relationships
with many of the Manufacturers it represents, it could lose relationships with
these Manufacturers due to consolidations within the industry or the Company's
inability to meet sales and performance objectives.

DEPENDENCE ON KEY PERSONNEL

    The Company's business depends upon its retention of employees who maintain
key relationships with its larger Retailers and Manufacturers. The loss of any
of these employees to a competitor could have a significant adverse impact on
the Company's business if major Manufacturers follow these employees and
transfer business to the competitor. See "Item 10. Directors and Executive
Officers of the Company" for the identification of certain of the Company's key
employees.

ANTI-TAKEOVER EFFECT OF CERTIFICATE OF INCORPORATION; BY-LAW PROVISIONS AND
  DELAWARE LAW

    Certain provisions of the Company's Second Amended and Restated Certificate
of Incorporation and Amended and Restated By-Laws, certain sections of the
Delaware General Corporation Law and the ability of the Company's Board of
Directors to issue shares of preferred stock and to establish the voting rights,
preferences and other terms thereof may be deemed to have an anti-takeover
effect. These provisions may discourage takeover attempts not first approved by
the Board of Directors, including takeovers that certain stockholders may deem
to be in their best interests. In addition, these provisions could delay or
frustrate the removal of incumbent directors or the assumption of control by
stockholders, even if such removal or assumption of control would be beneficial
to stockholders. See "Item 10. Directors and Executive Officers of the Company".

ITEM 2.  PROPERTIES

    EXECUTIVE OFFICES

    The Company operates two offices in connection with the performance of
executive and corporate activities. The Company's primary executive and
corporate facility is located in an office building in Dallas, Texas. This
facility is leased under an operating lease expiring in September 2003 and
consists of approximately 40,700 square feet. The Company also owns and
continues to operate an approximately 45,000 square foot facility in Canton,
Massachusetts. This office was formerly the headquarters of Merkert.

    SALES OFFICES

    As of December 31, 2000, the Company operated 74 sales offices in 37 states.
A total of 15 additional facilities have been vacated and their functions
consolidated with other offices. The Company is subject to continuing lease
obligations in connection with these vacated facilities, although nine of these
properties are currently under sublease agreements.

    CONDITION AND ADEQUACY

    The Company believes that its properties are generally well maintained, in
good condition, and adequate for its present needs. Generally, the Company has
been able to secure replacement and additional space as required by changing
market conditions.

                                       20
<PAGE>
    PROPERTY STRATEGY

    The Company's objective is to effectively manage facility decisions across
all business units. To accomplish this objective, the Company plans to
transition its properties to a 100% lease-based office portfolio. In connection
therewith, the Company seeks to build maximum flexibility into all of its lease
terms. Such a transition should allow the Company to adjust office presence and
size to best meet changing Manufacturer and Retailer needs primarily created by
Manufacturer and Retailer consolidation and centralized buying and
merchandising.

    The Company shall continue the development of a centralized corporate
oversight facilities management team established to:

    - improve lease terms through negotiations by internal real estate
      professionals;

    - reduce construction and furniture costs through centralized procurement;

    - develop a consistent facility image across all offices, and

    - properly manage facility maintenance.

    RECENT SALES OF PROPERTIES

    PHOENIX, ARIZONA.  On February 17, 2000, the Company sold its improved real
property containing general office space situated in Maricopa County, Arizona to
RCPI Office Properties, LLC, ("LLC") an affiliate of MS Acquisition and Richmont
Capital Partners I, LLP (RCPI), for approximately $2.4 million before related
costs. In May 2000, LLC sold this property to an unrelated third party.

    ORANGE COUNTY, CALIFORNIA.  On February 17, 2000, the Company sold its 3.47
acres of improved real property containing office and warehouse space situated
in Orange County, California, to LLC for approximately $4.9 million before
related costs. In May 2000, LLC sold this property to an unrelated third party.

    CHARLOTTE, NORTH CAROLINA.  On December 15, 2000, the Company sold its 4.851
acres of improved real property containing office and warehouse space situated
in Mecklenberg County, North Carolina, to Tower Point, LLC for approximately
$2.6 million before related costs.

ITEM 3.  LEGAL PROCEEDINGS AND ADMINISTRATIVE MATTERS

    As reported in the Company's Current Report on Form 8-K dated July 6, 2000,
and in the Company's Quarterly Report for the period ended June 30, 2000, a
lawsuit was filed on June 8, 2000 in the Delaware Court of Chancery by William
Brown, III, on behalf of the public stockholders, alleging that the offer price
made in the proposal by the majority stockholder, RCPI, to purchase all
outstanding shares of the Company is inadequate. The plaintiff class asserts
that the Board of Directors has violated its fiduciary duties to the Company
stockholders, including the duty of fair dealing. The plaintiff class seeks the
enjoinder of the tender offer by RCPI or the rescission of the contract if the
offer is consummated and the awarding of rescission damages. The suit has been
consolidated with two other identical suits. All parties have been served, but
there has been secured an indefinite extension to answer. Although discovery
requests have been served by the plaintiff class's counsel, a response will not
be due until 30 days after an agreement on the tender offer has been reached. No
such agreement has currently been reached.

    Various other suits and claims are filed against the Company from time to
time in the ordinary course of business and are currently pending. The Company
is not party to any other legal proceeding that, in the opinion of its
management, will have a material adverse effect on its business or financial
condition.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

    None.

                                       21
<PAGE>
                                    PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

    Effective March 14, 2001, the Company's Common Stock is no longer listed on
the Nasdaq SmallCap Market. The Company is eligible for trading on the OTC
Bulletin Board. For the years ended December 31, 2000 and 1999, the Company's
Common Stock traded on the Nasdaq Small Cap Market under the symbol "MKSP." The
following table sets forth the high and low closing sale prices for each full
quarterly period for the Common Stock for the years ended December 31, 2000 and
1999:

<TABLE>
<CAPTION>
DATE                                                            HIGH       LOW
----                                                          --------   --------
<S>                                                           <C>        <C>
First Quarter 1999..........................................   15.50      10.25
Second Quarter 1999.........................................   11.88       8.63
Third Quarter 1999..........................................   10.81       5.25
Fourth Quarter 1999.........................................    5.63       2.00

First Quarter 2000..........................................    3.75       2.00
Second Quarter 2000.........................................    2.84       0.88
Third Quarter 2000..........................................    1.84       1.25
Fourth Quarter 2000.........................................    1.38       0.19
</TABLE>

    As of March 15, 2001, there were approximately 826 holders of record of the
Company's single class of Common Stock, including 819 holders of record of the
Company's unrestricted Common Stock and 7 holders of record of the Company's
restricted Common Stock. As of March 15, 2001, there were 25,985,545 shares of
the Company's single class of Common Stock outstanding, including 25,912,809
shares of the Company's unrestricted Common Stock and 72,736 shares of the
Company's restricted Common Stock, and 39,707 shares of the Company's issued
Common Stock is held in treasury by the Company.

    DIVIDEND POLICY.  The Company has not paid any dividends in the last two
fiscal years. The Company intends to retain earnings, if any, to finance the
growth and development of its business and does not anticipate paying cash
dividends in the foreseeable future. Under the Amended Credit Agreement and the
First Union Amended Credit Agreement, the Company and its subsidiaries are
prohibited from declaring or paying any dividend or other distribution on
account of any shares, except the Company's subsidiaries may pay dividends to
the extent necessary to pay the Company's obligation under the Amended Credit
Agreement and expenses and taxes incurred in the ordinary course of business.
The Company and its subsidiaries may also declare common stock dividends on
their Common Stock.

    COMMON STOCK TRANSACTIONS.  On January 7, 2000, the Company issued 1,577,287
shares of Common Stock to MS Acquisition for an aggregate purchase price of
$5.0 million ($3.17 per share) pursuant to the terms of a stock purchase
agreement. On March 30, 2000, MS Acquisition purchased an additional 4,000,000
shares of Common Stock for an aggregate purchase price of $10.0 million ($2.50
per share) pursuant to the terms of a stock purchase agreement. The Company used
the funds as an additional source of capital for operations and additional
short-term and long-term liquidity. The offering, sale and issuance of these
shares was exempt from registration under the Securities Act pursuant to a
private offering exemption under Section 4(2) promulgated thereunder.

    REDEEMABLE CONVERTIBLE PREFERRED STOCK TRANSACTIONS

    UNDESIGNATED PREFERRED STOCK

    As of December 31,2000, there were no shares of undesignated preferred stock
outstanding. Holders of undesignated preferred stock would have priority over
the holders of Common Stock with respect to dividends and to other
distributions, including the distribution of assets upon liquidation. The Board
of Directors has the authority, without stockholder authorization, to issue
shares of

                                       22
<PAGE>
undesignated preferred stock in one or more series and to fix the terms,
limitations, relative rights and preferences and variations.

    PREFERRED STOCK

    On June 23, 2000, the Board of Directors of the Company authorized and
provided for the issuance of up to 10,000 shares of 8.0% Convertible
Paid-In-Kind Preferred Stock, par value $0.01 per share, with a stated value of
$1,000 per share (the "Preferred Stock"). Each share of the Preferred Stock is
convertible into that number of shares of Common Stock equal to the result
obtained by dividing the stated value of the Preferred Stock by the conversion
price in effect at the conversion date.

    All dividends on issued shares of the Preferred Stock are cumulative,
whether or not the dividends are earned or declared, on a daily basis from the
issue date and payable quarterly in arrears on each dividend payment date. Even
if not declared, all unpaid dividends will compound quarterly at an annual
dividend rate equal to 8.0%, or the applicable dividend rate.

    On June 22, 2010, the Company will be obligated to redeem, to the extend of
funds legally available, all outstanding shares of the Preferred Stock at a
redemption price equal to 100% of the liquidation preference per share. The
liquidation preference per share will be equal to the greater of $1,000 per
share or the amount that the equivalent number of shares of Common Stock (based
on the conversion rate applicable at the liquidation date) would be entitled to
receive, plus any unpaid dividends.

    On June 23, 2000, the Company issued 5,000 shares of Preferred Stock to MS
Acquisition for an aggregate purchase price of $5.0 million pursuant to the
terms of a preferred stock purchase agreement. On August 8, 2000, the Company
issued 4,500 additional shares of Preferred Stock to MS Acquisition for an
aggregate purchase price of $4.5 million pursuant to the terms of a preferred
stock purchase agreement.

    On July 27, 2000, the Company received early termination of the waiting
period in connection with its Hart-Scott-Rodino Antitrust Improvement Act filing
thereafter allowing the conversion of the Preferred Stock to Common Stock of the
Company. On August 21, 2000, the 9,500 shares of Preferred Stock previously
issued to MS Acquisition were converted into 6,234,414 shares of Common Stock.
Per the terms of the preferred stock purchase agreements, each share of
Preferred Stock was converted into approximately 656.25 shares of Common Stock
(i.e., the Preferred Stock's stated value of $1,000 divided by the conversion
price of $1.5238).

    On August 17, 2000, the Company issued a $4.75 million promissory note to MS
Acquisition. On August 30, 2000, the Company issued a $5.0 million promissory
note to MS Acquisition. The Registered Notes and the New Senior Credit Facility
are senior to these notes. The Company used the proceeds from both promissory
notes for general corporate purposes.

    SERIES B PREFERRED STOCK

    On November 1, 2000, the Company's Board of Directors authorized the
issuance of up to 20,000 shares of Series B 8.0% Convertible Paid-In-Kind
Preferred Stock, $0.01 par value per share (the "Series B Preferred Stock"). The
Series B Preferred Stock has a stated value of $1,000 per share. The Series B
Preferred Stock is of equal class with the Preferred Stock previously authorized
and any future designated series of preferred stock unless specifically noted in
future preferred stock agreements. The Series B Preferred Stock has the same
characteristics (i.e., dividend terms, conversion features) as the Preferred
Stock.

    On November 1, 2000, the Company issued 12,397 shares of the Series B 8.0%
to MS Acquisition for an aggregate purchase price of approximately
$12.4 million pursuant to the terms of a preferred stock purchase agreement. The
purchase price consisted of the cancellation of the $4.75 million promissory
note and the $5.0 million promissory note, including all accrued and unpaid
interest, plus an

                                       23
<PAGE>
additional cash payment of approximately $2.5 million to the Company. The
incremental proceeds from the issuance of the Series B Preferred Stock were used
for general corporate purposes.

    On November 9, 2000, the Company issued a $2.5 million promissory note to MS
Acquisition. This promissory note is subordinate to the senior debt of the
Company. The proceeds were used for general corporate purposes. The
$2.5 million promissory note bears interest at a rate equal to the sum of an
interest margin of 2.75% plus the applicable prime rate on the last business day
of the quarter for which interest is payable. Interest is payable quarterly in
arrears, commencing on December 31, 2000, and will continue through the maturity
date. The $2.5 million promissory note and any unpaid and accrued interest will
be payable on November 9, 2002, or on demand, under specified conditions. The
Company is not permitted to repay the principal and unpaid and accrued interest
on the $2.5 million promissory note on demand if the Company's borrowing base
30 days prior to a payment date is not at least $10.0 million, or 25% of the sum
of the Company's payroll for the last four consecutive pay periods, whichever is
greater. In the first quarter of 2001, the $2.5 million promissory note was
converted into redeemable convertible preferred stock. See Note 20 of the
Company's Notes to Consolidated Financial Statements for additional information.

    On January 26, 2001, the Company issued 7,568 shares of the Series B
Preferred Stock to MS Acquisition for an aggregate purchase price of
approximately $7.6 million pursuant to the terms of a preferred stock purchase
agreement. The purchase price consisted of the cancellation of the $2.5 million
promissory note and, including all accrued and unpaid interest, plus an
additional cash payment of approximately $5.0 million to the Company. A total of
$4.0 million of the cash proceeds were received in December 2000 and appeared as
a component of Other Liabilities in the consolidated balance sheet as of
December 31, 2000. The incremental proceeds from the issuance of the Series B
Preferred Stock were used for general corporate purposes.

    SERIES C PREFERRED STOCK

    On March 26, 2001, the Company's Board of Directors authorized the issuance
of up to 20,000 shares of Series C 8.0% Convertible Paid-In-Kind Preferred
Stock, $0.01 par value per share (the "Series C Preferred Stock"). The Series C
Preferred Stock has a stated value of $1,000 per share. The Series C Preferred
Stock is of equal class with the Preferred Stock and the Series B Preferred
Stock previously authorized and any future designated series of preferred stock
unless specifically noted in future preferred stock agreements.

    Each share of the Series C Preferred Stock is convertible into that number
of shares of Common Stock equal to the result obtained by dividing the stated
value of the Series C Preferred Stock by the conversion price in effect at the
conversion date.

    All dividends on issued shares of the Series C Preferred Stock are
cumulative, whether or not the dividends are earned or declared, on a daily
basis from the issue date and payable quarterly in arrears on each dividend
payment date. Even if not declared, all unpaid dividends will compound quarterly
at an annual dividend rate equal to 8.0%, or the applicable dividend rate.

    On June 22, 2010, the Company will be obligated to redeem, to the extend of
funds legally available, all outstanding shares of the Series C Preferred Stock
at a redemption price equal to 100% of the liquidation preference per share. The
liquidation preference per share will be equal to the greater of $1,000 per
share or the amount that the equivalent number of shares of Common Stock (based
on the conversion rate applicable at the liquidation date) would be entitled to
receive, plus any unpaid dividends.

    On March 28, 2001, the Company issued 9,000 shares of the Series C Preferred
Stock to MS Acquisition for an aggregate purchase price of $9.0 million in cash
pursuant to the terms of a preferred stock purchase agreement. The proceeds from
the issuance of the Series C Preferred Stock were used for general corporate
purposes.

    On March 30, 2001, the Company issued 2,000 shares of the Series C Preferred
Stock to MS Acquisition for an aggregate purchase price of $2.0 million in cash
pursuant to the terms of a preferred stock purchase agreement. The proceeds from
the issuance of the Series C Preferred Stock were used for general corporate
purposes.

                                       24
<PAGE>
ITEM 6.  SELECTED FINANCIAL DATA

SELECTED CONSOLIDATED FINANCIAL DATA FOR MARKETING SPECIALISTS CORPORATION

    The following selected consolidated financial data sets forth, for the
periods and the dates indicated, summary consolidated financial data of the
Company and its subsidiaries. The consolidated statement of operations data for
each of the years ended December 31, 1996 and 1997, and for the period ended
December 18, 1998 are derived from audited consolidated financial statements of
each of Merkert and Rogers. The consolidated statement of operations data for
the period from the Company's inception (March 4, 1998) through December 31,
1998 and for the year ended December 31, 1999, and the consolidated balance
sheet data at December 31, 1998, 1999, and 2000, are derived from audited
consolidated financial statements of the Company. The financial data presented
below is qualified by reference to the consolidated financial statements
included herein and in the Company's public filings with the SEC and should be
read in conjunction with such financial statements and notes thereto and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."

<TABLE>
<CAPTION>
                                                   ENDED                                               YEARS ENDED
                                               DECEMBER 31,       PERIOD ENDED    INCEPTION TO        DECEMBER 31,
                                            -------------------   DECEMBER 18,    DECEMBER 31,    ---------------------
                                              1996       1997         1998            1998          1999        2000
                                            --------   --------   -------------   -------------   --------   ----------
                                                                      (DOLLARS IN THOUSANDS)
<S>                                         <C>        <C>        <C>             <C>             <C>        <C>
MERKERT:(3)
Statement of Operations Data:
  Revenues................................  $80,661    $104,274     $ 90,254        $     --      $     --   $       --
  Operating loss(1).......................   (2,393)     (2,705)      (9,754)             --            --           --
  Loss from continuing operations.........   (5,100)     (7,527)     (14,464)             --            --           --
  Income from discontinued operations.....    3,026       4,078        3,476              --            --           --
  Net loss................................   (2,074)     (3,449)     (10,988)             --            --           --
Other Financial Data:
  EBITDA(2)...............................       54       1,779        4,352              --            --           --
ROGERS:(3)
Statement of Operations Data:
  Revenues................................  $63,311    $ 82,985     $ 79,558        $     --      $     --   $       --
  Operating income (loss)(1)..............      107       4,085      (15,949)             --            --           --
  Net income (loss).......................   (1,089)        745      (17,889)             --            --           --
Other Financial Data:
  EBITDA(2)...............................    1,753       6,601      (12,562)             --            --           --
MARKETING SPECIALISTS CORPORATION:
Statement of Operations Data:
  Revenues................................  $    --    $     --     $     --        $  5,975      $246,612   $  380,830
  Operating loss(1).......................       --          --           --          (1,239)       (8,395)    (332,534)
  Loss from continuing operations.........       --          --           --          (1,518)      (22,002)    (364,830)
  Income (loss) from discontinued
    operations............................       --          --           --              52           435         (638)
  Net loss(1).............................       --          --           --          (1,466)      (21,567)    (365,468)
Other Financial Data:
  EBITDA(2)...............................       --          --           --          (1,060)       18,399       23,495
BALANCE SHEET DATA--MARKETING SPECIALISTS
  CORPORATION (END OF PERIOD):
  Working capital (deficit)...............  $    --    $     --     $     --        $ (2,108)     $(29,908)  $  (58,737)
  Total assets............................       --          --           --         188,410       449,616      144,747
  Long-term obligations, less current
    maturities............................       --          --           --          74,673       227,831      230,523
  Redeemable convertible preferred stock,
    at stated value.......................       --          --           --              --            --       12,397
  Stockholders' equity (deficit)..........       --          --           --          72,595       118,242     (221,021)
</TABLE>

--------------------------

(1) Includes restructuring charges of approximately $6.0 million for Merkert and
    $0.9 million for Rogers for the period ended December 18, 1998, and
    approximately $13.3 million and $2.5 million for the Company for the years
    ended December 31, 1999 and 2000, respectively. Includes other nonrecurring
    charges of approximately $19.5 million and a goodwill impairment loss of
    approximately $307.0 million for the year ended December 31, 2000.

                                       25
<PAGE>
(2) EBITDA represents earnings before interest, taxes, depreciation,
    amortization, the impairment loss and restructuring and other nonrecurring
    charges. The Company believes that EBITDA may be useful to investors for
    measuring the Company's ability to service debt, to make new investments and
    to meet working capital requirements. EBITDA as calculated by the Company
    may not be consistent with calculations of EBITDA by other companies. EBITDA
    should not be considered in isolation from or as a substitute for net income
    (loss), cash flows from operating activities or other statements of
    operations or cash flows prepared in accordance with generally accepted
    accounting principles or as a measure of profitability or liquidity.

(3) Represents predecessor financial statements.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
  OF OPERATIONS

    This Annual Report on Form 10-K contains, in addition to historical
information, forward-looking statements that involve risks and uncertainties.
The Company's actual results could differ significantly from the results
discussed in the forward-looking statements. Factors that could cause or
contribute to such differences include those discussed in "Risk Factors" as well
as those discussed elsewhere herein. The following discussion and analysis
should be read in conjunction with the Company's consolidated financial
statements and related notes thereto presented elsewhere in this Annual Report
on Form 10-K.

INTRODUCTION

    The Company was incorporated on March 4, 1998, to create a leading national
food brokerage firm providing outsourced sales, merchandising and marketing
services to Manufacturers. The Company acts as an independent sales and
marketing representative, selling grocery and consumer products on behalf of
Manufacturers and coordinating the execution of Manufacturers' marketing
programs with Retailers. The Company's principal source of revenue is
commissions it receives from Manufacturers.

    On December 18, 1998, the Company consummated the Offering of 4,400,000
shares of Common Stock at an offering price of $15.00 per share. Simultaneously
with the Offering, the Company purchased in separate transactions all of the
issued and outstanding capital stock of Merkert and Rogers. As a result, each of
Merkert and Rogers became a wholly-owned subsidiary of the Company. Prior to
December 18, 1998, the Company conducted operations only in connection with the
Combination and the Offering. In January 1999, the Company issued 290,000 shares
of Common Stock in connection with the exercise of a portion of the
over-allotment option by the underwriters of the Offering, raising net proceeds
of approximately $4.0 million.

ACQUISITION AND DIVESTITURE HISTORY

    GENERAL

    The Merger and other acquisitions noted below were accounted for using the
purchase method of accounting. The intangible assets resulting from each
acquisition are being amortized over their estimated useful lives.

    THE MERGER

    On August 18, 1999, the Company completed the Merger with RMSI for an
aggregate discounted purchase price of approximately $236.8 million, which
included approximately $3.4 million in cash payments for closing costs,
$170.0 million in assumed debt and $63.4 million in Common Stock and options.
Under the terms of the Merger, RMSI stockholders received 6,705,551 shares of
the Company's Common Stock. The Company also granted certain RMSI stockholders
and employees options to purchase 800,000 in additional shares of the Company's
Common Stock at a price equal to $13.50 per share. For financial reporting
purposes, the Company is presented as the acquiring entity, since the Company's
stockholders own the largest portion of the Common Stock of the combined
Company. Immediately following the Merger, the Company amended its certificate
of incorporation to

                                       26
<PAGE>
change its corporate name to "Marketing Specialists Corporation." The operating
results of RMSI have been included in the Company's operating results for all
periods subsequent to the Merger.

    OTHER ACQUISITIONS AND DIVESTITURES

    In January 1999, the Company acquired Sell, a brokerage firm operating in
the Midwest region of the United States. The Company completed the acquisition
of Sell for an aggregate discounted purchase price of approximately
$8.5 million, which included approximately $3.1 million in cash payments,
$3.8 million in new debt, and $1.6 million in assumed debt. The operating
results of Sell have been included in the Company's operating results for all
periods subsequent to the acquisition date.

    In April 1999, the Company acquired UBC, a brokerage firm operating in the
Midwest region of the United States. The Company acquired UBC for an aggregate
discounted purchase price of approximately $6.6 million, which included
approximately $0.9 million in cash payments, $3.3 million in new debt, and
$2.4 million in assumed debt. The operating results of UBC have been included in
the Company's operating results for all periods subsequent to the acquisition
date.

    In July 1999, the Company acquired Buckeye, a brokerage firm operating in
the Cleveland, Ohio; Pittsburgh, Pennsylvania; and upstate New York markets. The
Company acquired Buckeye for an aggregate discounted purchase price of
approximately $5.0 million, which included approximately $0.1 million in cash
payments, $3.4 million in new debt, and $1.5 million in assumed debt. The
operating results of Buckeye have been included in the Company's operating
results for all periods subsequent to the acquisition date.

    In October 1999, the Company acquired Inman, a brokerage firm operating in
the Midwest region of the United States. The Company completed the acquisition
of Inman for an aggregate discounted purchase price of approximately
$14.0 million, which included approximately $9.8 million in cash payments,
$1.0 million in new debt, and $3.2 million in assumed debt. The operating
results of Inman have been included in the Company's operating results for all
periods subsequent to the acquisition date.

    In January 2000, the Company acquired Johnson-Leiber, a brokerage firm
operating in the Seattle, Washington; Spokane, Washington; Portland, Oregon;
Billings, Montana; and Anchorage, Alaska markets. The Company acquired
Johnson-Leiber for an aggregate discounted purchase price of approximately
$10.2 million, which included approximately $3.2 million in cash payments and
$7.0 million in new debt and other incentives. The operating results of
Johnson-Leiber have been included in the Company's operating results for all
periods subsequent to the acquisition date.

    In April 2000, the Company acquired Sales Force, a full service brokerage
firm operating in the Central Region of the United States. The Company acquired
Sales Force for an aggregate discounted purchase price of approximately
$18.8 million, which included approximately $6.1 million cash payments,
$7.8 million in new debt, and $4.9 million in assumed debt. The operating
results of Sales Force have been included in the Company's operating results for
all periods subsequent to the acquisition date.

    In July 2000, the Company signed a letter of intent to sell its Private
Label business, known as Buy Sell, to Woodland Partners. On January 19, 2001,
the Company completed the sale of Buy Sell to Woodland Partners. For reporting
purposes, Buy Sell qualified as a segment, as it represented a separate major
line of business for the Company. For purposes of calculating the loss from
discontinued operations, the measurement date was November 30, 2000, and the
disposal date was January 19, 2001. See Note 20 of the Company's Notes to
Consolidated Financial Statements for additional information.

                                       27
<PAGE>
RESULTS OF OPERATIONS

    The following defined terms are used in conjunction with the Company's
discussion of operating results.

    REVENUES.  Revenues are derived mainly from commissions earned from
Manufacturers based on the Manufacturers' invoices to Retailers for products
sold. Commissions are usually expressed as a percentage of the invoice as agreed
by contract between the Manufacturer and broker. Commission rates typically
range from 3% for full brokerage services to 1% for retail-only services.
Revenues are presented net of allowances and deductions taken by Manufacturers.

    SELLING, GENERAL AND ADMINISTRATIVE EXPENSES.  Selling expenses consist
predominately of salaries, fringe benefits and incentives for personnel directly
involved in providing services to Manufacturers and Retailers. Other selling
expenses include, among other things, automobiles utilized by the sales
personnel, promotional expenses, and travel and entertainment. General and
administrative expenses consist primarily of salaries and fringe benefits for
administrative and corporate personnel, occupancy and other office expenses,
information technology, communications and insurance.

    DEPRECIATION AND AMORTIZATION EXPENSES.  Depreciation and amortization
expenses relate to property, plant and equipment and intangible assets,
including goodwill and non-compete agreements.

    IMPAIRMENT LOSS.  Impairment loss relates to the impairment of the Company's
Goodwill. See Note 3 to the accompanying Consolidated Financial Statements for
more information.

    NONRECURRING CHARGES.  Nonrecurring charges relate to the Company's ongoing
integration of business processes and the change in estimate relating to the
collectibility of trade accounts receivable.

    RESTRUCTURING CHARGES.  Restructuring charges relate to severance costs
associated with the reduction in redundant employee positions and the closure of
redundant facilities in connection with the Merger and completed acquisitions.

    INCOME (LOSS) FROM DISCONTINUED OPERATIONS.  Income (loss) from discontinued
operations relates to the operations of segments of the business that the
Company sold or disposed of and the associated gain or loss on disposal.

    The following table sets forth the results of operations of the Company for
the periods indicated.

<TABLE>
<CAPTION>
                                                                            YEAR ENDED           PERIOD ENDED
                                                    YEAR ENDED             DECEMBER 31,          DECEMBER 18,
                                                 DECEMBER 31, 2000             1999                 1998*
                                                -------------------      ----------------      ----------------
<S>                                             <C>          <C>         <C>        <C>        <C>        <C>
Revenues......................................  $ 380,830    100.0%      $246,612   100.0%     $169,812   100.0%
Selling expenses..............................    287,255     75.4        174,109    70.6       136,672    80.5
General and administrative....................     70,080     18.4         54,104    21.9        45,032    26.5
Depreciation..................................      7,533      2.0          3,834     1.6         2,322     1.4
Amortization..................................     19,572      5.1          9,670     3.9         4,554     2.7
Impairment loss...............................    306,953     80.6             --     0.0            --     0.0
Nonrecurring charges..........................     19,451      5.1             --     0.0            --     0.0
Restructuring charge..........................      2,520      0.7         13,290     5.4         6,935     4.1
                                                ---------    -----       --------   -----      --------   -----
Operating loss................................   (332,534)   (87.3)        (8,395)   (3.4)      (25,703)  (15.2)
Interest expense, net.........................    (32,647)    (8.6)       (13,854)   (5.6)       (6,797)   (4.0)
Other income (expense), net...................        351      0.1            247     0.1          (530)   (0.3)
                                                ---------    -----       --------   -----      --------   -----
Loss before income tax expense and
  discontinued operations.....................   (364,830)   (95.8)       (22,002)   (8.9)      (33,030)  (19.5)
Income tax expense (benefit)..................         --      0.0             --     0.0          (677)    0.4
                                                ---------    -----       --------   -----      --------   -----
Loss from continuing operations...............   (364,830)   (95.8)       (22,002)   (8.9)      (32,353)  (19.1)
Income (loss) from discontinued operations,
  net of tax..................................       (638)    (0.2)           435     0.2         3,476     2.1
                                                ---------    -----       --------   -----      --------   -----
Net loss......................................  $(365,468)   (96.0)%     $(21,567)   (8.7)%    $(28,877)  (17.0)%
                                                =========    =====       ========   =====      ========   =====
</TABLE>

*   Rogers and Merkert only (See ITEM 6)

                                       28
<PAGE>
    The reader should note references to "pro forma" results for the year ended
December 31, 1999, and "annualized" results for the period ended December 18,
1998 throughout the following discussion, since such information is more
meaningful to a discussion of the changes between years. References to "pro
forma" results only give effect to the Merger.

YEAR ENDED DECEMBER 31, 2000 COMPARED TO YEAR ENDED DECEMBER 31, 1999

    REVENUES.  Revenues increased approximately $134.2 million (or 54.4%) to
approximately $380.8 million for the year ended December 31, 2000, as compared
to $246.6 million for the same period in 1999. On a pro forma basis, the
Company's revenues increased approximately $1.2 million (or 0.3%).

    SELLING EXPENSES.  Selling expenses increased approximately $113.1 million
(or 65.0%) to approximately $287.3 million for the year ended December 31, 2000,
as compared to $174.1 million for the same period in 1999. On a pro forma basis,
the Company's selling expenses increased approximately $17.6 million (or 6.5%)
from last year. The increase is associated in part with the Company's ongoing
integration and consolidation strategy. Subsequent to the Merger, the Company
spent the first half of 2000 evaluating its resources, integrating all offices
onto one common sales and order entry system, rolling out common administrative
and sales practices, and implementing a new organization structure. As a result,
the Company incurred additional travel, salary and integration costs during that
period.

    GENERAL AND ADMINISTRATIVE EXPENSES.  General and administrative expenses
increased approximately $16.0 million (or 29.5%) to approximately $70.1 million
for the year ended December 31, 2000, as compared to $54.1 million for the same
period in 1999. On a pro forma basis, the Company's general and administrative
expenses decreased approximately ($15.2) million. This overall decline was the
result of the full-year effect of cost saving measures implemented to eliminate
redundancies in leased facilities as a result of the Combination and the Merger.

    As a percentage of total revenues, selling, general and administrative
expenses increased to 93.8% for 2000 from 92.5% in 1999 due to the factors
discussed above. On a pro forma basis, the Company's selling, general and
administrative expenses, as a percentage of total revenues, remained relatively
flat.

    Earnings before interest, taxes, depreciation, amortization, the impairment
loss and restructuring and nonrecurring charges increased approximately
$5.1 million to approximately $23.5 million for the year ended December 31,
2000, as compared to $18.4 million for the same period in 1999, as a result of
the factors noted above. On a pro forma basis, the Company's earnings before
interest, taxes, depreciation, amortization and restructuring and nonrecurring
charges decreased approximately $1.2 million, as a result of the factors noted
above.

    DEPRECIATION AND AMORTIZATION.  Depreciation and amortization expenses
increased approximately $13.6 million (or 100.7%) to approximately
$27.1 million for the year ended December 31, 2000, as compared to
$13.5 million for the same period in 1999. This increase was the result of the
full-year effect of the incremental fixed assets and intangible assets
associated with the Merger and, to a smaller degree, the acquisitions of
Johnson-Leiber and Sales Force, which generated goodwill that carried a shorter,
20-year estimated useful life. On a pro forma basis, the Company's depreciation
and amortization expenses increased approximately $3.2 million.

    IMPAIRMENT LOSS.  The results for the year ended December 31, 2000, included
an impairment loss of approximately ($307.0) million related to the Company's
recorded goodwill. The Company's continued operating losses, negative operating
cash flows and frequent cash infusions from a related party for working capital
purposes indicated that long-lived assets may be impaired. A goodwill impairment
analysis performed at the end of 2000 indicated that the Company's recorded
goodwill exceeded the Company's estimated future cash flows, undiscounted and
excluding interest charges.

                                       29
<PAGE>
Accordingly, an impairment loss was measured using discounted cash flows
compared to recorded goodwill. See "Liquidity and Capital Resources" and Note 7
to the Company's Notes to Consolidated Financial Statements for additional
discussion of the impairment.

    NONRECURRING CHARGES.  The results for the year ended December 31, 2000,
included nonrecurring charges of approximately $19.5 million, as compared to
none for the same period in 1999. During the third quarter of 2000, the Company
provided additional reserves for certain trade receivables related to the
continuing integration of business processes into its corporate headquarters and
changed its estimate related to the collectibility of its trade receivables
outstanding in excess of 120 days.

    RESTRUCTURING CHARGE.  The results for the year ended December 31, 2000
included a restructuring charge of approximately $2.5 million related to
severance and other termination benefits given to approximately 180 former
employees. The results for the year ended December 31, 1999 included a
restructuring charge of approximately $13.3 million, which consisted of
approximately $8.6 million related to obligations under vacated leased
facilities and $4.7 million related to severance and other termination benefits
given to former employees, resulting from the Merger.

    INTEREST EXPENSE.  Interest expense increased approximately $18.8 million
(or 135.6%) to approximately $32.6 million for the year ended December 31, 2000,
as compared to $13.9 million for the same period in 1999. On a pro forma basis,
the Company's interest expense increased approximately $8.7 million. The overall
increase was attributable to increased short-term borrowing and a full year of
interest on the Registered Notes.

    LOSS BEFORE INCOME TAX EXPENSE AND DISCONTINUED OPERATIONS.  The loss before
income taxes and discontinued operations increased approximately ($342.8)
million to approximately ($364.8) million for the year ended December 31, 2000,
from ($22.0) million for the same period in 1999, as a result of the factors
noted above.

    PROVISION FOR INCOME TAXES.  The Company has not recorded any tax benefits
associated with the losses for the years ended December 31, 2000 and 1999, since
it is more likely than not that the Company will not realize such benefits.

    INCOME (LOSS) FROM DISCONTINUED OPERATIONS.  The results for the year ended
December 31, 2000 included a loss from discontinued operations of approximately
($0.6) million, which included approximately $1.3 million of income from Buy
Sell operations through the measurement date and a ($1.9) million loss on the
sale of Buy Sell. The results for the year ended December 31, 1999 included
income of approximately $0.4 million from Buy Sell operations.

    NET LOSS.  Net loss increased approximately ($343.9) million to
approximately ($365.5) million for the year ended December 31, 2000, from
($21.6) million in the year ended December 31, 1999, as a result of the factors
noted above.

YEAR ENDED DECEMBER 31, 1999 COMPARED TO PERIOD ENDED DECEMBER 18, 1998

    REVENUES.  Revenues increased approximately $76.8 million (or 45.2%) to
approximately $246.6 million for the year ended December 31, 1999, as compared
to $169.8 million for the period ended December 18, 1998. Revenues for 1999
included approximately $79.8 million related to RMSI. The Company's revenues
(without RMSI) for the year ended December 31, 1999, decreased approximately
($8.8) million to approximately $166.8 million, as compared to $175.6 million
for the annualized period ended December 18, 1998. The overall decline in
revenue on an annualized basis was the result of the full-year effect of
Manufacturer conflicts resulting from the Combination and, to a lesser extent,
the Merger. In addition, the continued consolidation of Manufacturer
representation by food brokers has negatively affected the Company's results.

                                       30
<PAGE>
    SELLING EXPENSES.  Selling expenses increased approximately $37.4 million
(or 27.4%) to approximately $174.1 million for the year ended December 31, 1999,
as compared to $136.7 million for the period ended December 18, 1998. Selling
expenses for 1999 included approximately $51.6 million related to RMSI. The
Company's selling expenses (without RMSI) for the year ended December 31, 1999,
decreased approximately ($18.8) million to approximately $122.5 million, as
compared to $141.3 million for the annualized period ended December 18, 1998.
The decline in selling expenses on an annualized basis was a result of the
reductions in the sales force associated with Manufacturer conflicts resulting
from the Combination and, to a lesser extent, the Merger.

    GENERAL AND ADMINISTRATIVE EXPENSES.  General and administrative expenses
increased approximately $9.1 million (or 20.1%) to approximately $54.1 million
for the year ended December 31, 1999, as compared to $45.0 million for the
period ended December 18, 1998. General and administrative expenses for 1999
included approximately $18.8 million related to RMSI. The Company's general and
administrative expenses (without RMSI) for the year ended December 31, 1999,
decreased approximately ($11.3) million to approximately $35.3 million, as
compared to $46.6 million for the annualized period ended December 18, 1998. The
overall decrease in general and administrative expenses on an annualized basis
was the result of the full-year effect of cost saving measures implemented to
eliminate redundancies in leased facilities resulting from the Combination.

    As a percentage of total revenues, selling, general and administrative
expenses decreased to 92.5% for 1999 from 107.0% for the period ended
December 18, 1998, due to the factors discussed above. As a percentage of total
revenues, the Company's selling, general and administrative expenses (without
RMSI) for the year ended December 31, 1999, decreased to 94.6% from 107.0% for
the annualized period ended December 18, 1998, due to the factors noted above.

    Earnings before interest, taxes, depreciation, amortization and
restructuring charges increased to approximately $18.4 million for the year
ended December 31, 1999, as compared to ($11.9) million for the period ended
December 18, 1998, as a result of the factors noted above. Earnings before
interest, taxes, depreciation, amortization and restructuring charges (without
RMSI) increased to approximately $9.0 million for the year ended December 31,
1999, as compared to ($12.3) million for the annualized period ended
December 18, 1998, as a result of the factors noted above.

    DEPRECIATION AND AMORTIZATION.  Depreciation and amortization expenses
increased approximately $6.6 million (or 96.4%) to approximately $13.5 million
for the year ended December 31, 1999, as compared to $6.9 million for the period
ended December 18, 1998. Depreciation and amortization expenses for 1999
included approximately $2.9 million related to the Merger. The Company's
depreciation and amortization expenses (without amounts related to the Merger)
increased approximately $3.7 million to approximately $10.6 million for the year
ended December 31, 1999, as compared to $6.9 million for the period ended
December 18, 1998. The overall increase was the result of the full-year effect
of the goodwill and other intangible assets associated with the Combination and
the Merger.

    RESTRUCTURING CHARGE.  The results for the year ended December 31, 1999,
included a restructuring charge of approximately $13.3 million, which consisted
of approximately $8.6 million related to obligations under vacated leased
facilities and $4.7 million related to severance and other termination benefits
given to former employees. The results for the period ended December 18, 1998,
included a restructuring charge of approximately $6.9 million related to the
elimination of redundant personnel and facilities costs.

    INTEREST EXPENSE.  Interest expense increased approximately $7.1 million (or
103.8%) to approximately $13.9 million for the year ended December 31, 1999, as
compared to $6.8 million for the period ended December 18, 1998. The Company's
interest expense for 1999 included approximately $6.3 million related to RMSI.
The Company's interest expense (without RMSI) for the year ended

                                       31
<PAGE>
December 31, 1999, increased approximately $0.8 million to approximately
$7.6 million, as compared to $6.8 million for the period ended December 18,
1998. The overall increase was attributable to increased short-term borrowing
and interest on the Registered Notes.

    LOSS BEFORE INCOME TAX EXPENSE AND DISCONTINUED OPERATIONS.  The loss before
income taxes and discontinued operations decreased to approximately ($22.0)
million for the year ended December 31, 1999, from ($33.0) million for the same
period in 1999, as a result of the factors noted above.

    PROVISION FOR INCOME TAXES.  The Company has not recorded any tax benefits
associated with its operating losses, since it is more likely than not that the
Company will not realize such benefits.

    INCOME FROM DISCONTINUED OPERATIONS.  The results for the year ended
December 31, 1999, and the period ended December 18, 1998, included income of
approximately $0.4 million and $3.5 million from Buy Sell operations for these
periods, respectively.

    NET LOSS.  Net loss decreased to approximately ($21.6) million for the year
ended December 31, 1999, from ($28.9) million for the period ended December 18,
1998, as a result of the factors noted above.

COMBINED INTEGRATION ACTIVITIES

    Since the beginning of 1999, the Company completed seven acquisitions,
resulting in the coverage of new geographic markets and expanding representation
of Manufacturers' product offerings within existing markets. The Company's
strategic acquisition plan included the selection, acquisition and management of
businesses in various brokerage markets, including the retail food, food service
and private label markets.

    As part of the Merger, the Company further integrated many of its sales
offices and most of its administrative operations (including accounting,
treasury, payroll, human resources, and information technology). This process
resulted in the integration and consolidation of 37 facilities throughout the
Southeast and Mid-Atlantic regions of the country. As a result of its ongoing
integration activities, the Company recorded a restructuring charge during the
year ended December 31, 1999 of approximately $13.3 million. The charge
consisted of approximately $8.6 million relating to non-cancelable lease
obligations on vacated facilities and $4.7 million relating to severance and
other personnel-related amounts. During the third quarter of 2000, the Company
recorded an additional restructuring charge of approximately $2.5 million
relating to severance and other termination costs. During the same quarter, the
Company also provided additional reserves for certain trade receivables related
to the continuing integration of business processes into its corporate
headquarters and changed its estimate related to the collectibility of its trade
receivables outstanding in excess of 120 days. See Note 18 of the Company's
Notes to Consolidated Financial Statements for additional information.

    As set forth in the following table, the Company's unaudited pro forma
EBITDA (giving effect to the Merger only) for the year ended December 31, 1999
was approximately $24.7 million compared to

                                       32
<PAGE>
actual EBITDA of approximately $23.5 million and $18.4 million for the year
ended December 31, 2000 and 1999, respectively.

<TABLE>
<CAPTION>
                                                                                                PRO FORMA YEAR
                                                                            YEAR ENDED              ENDED
                                                    YEAR ENDED             DECEMBER 31,          DECEMBER 31,
                                                 DECEMBER 31, 2000             1999                  1999
                                                -------------------      ----------------      ----------------
                                                                                                 (UNAUDITED)
<S>                                             <C>          <C>         <C>        <C>        <C>        <C>
Revenues......................................  $ 380,830    100.0%      $246,612   100.0%     $379,596   100.0%
Selling expenses..............................    287,255     75.4        174,109    70.6       269,662    71.0
General and administrative....................     70,080     18.4         54,104    21.9        85,254    22.5
Depreciation..................................      7,533      2.0          3,834     1.6         7,412     2.0
Amortization..................................     19,572      5.1          9,670     3.9        16,512     4.3
Impairment loss...............................    306,953     80.6             --     0.0            --     0.0
Nonrecurring charges..........................     19,451      5.1             --     0.0            --     0.0
Restructuring charge..........................      2,520      0.7         13,290     5.4            --     0.0
                                                ---------    -----       --------   -----      --------   -----
Operating income (loss).......................   (332,534)   (87.3)        (8,395)   (3.4)          756     0.2
EBITDA........................................     23,495      6.2         18,399     7.5        24,680     6.5
Interest expense, net.........................    (32,647)    (8.6)       (13,854)   (5.6)      (23,944)   (6.3)
Other income (expense), net...................        351      0.1            247     0.1           127     0.0
                                                ---------    -----       --------   -----      --------   -----
Loss before income tax expense and
  discontinued operations.....................   (364,830)   (95.8)       (22,002)   (8.9)      (23,061)   (6.1)
Income tax expense (benefit)..................         --      0.0             --     0.0        (1,338)    0.4
                                                ---------    -----       --------   -----      --------   -----
Loss before discontinued operations...........   (364,830)   (95.8)       (22,002)   (8.9)      (21,723)   (5.7)
Income (loss) from discontinued operations,
  net of tax..................................       (638)    (0.2)           435     0.2           435     0.1
                                                ---------    -----       --------   -----      --------   -----
Loss before extraordinary item................   (365,468)   (96.0)       (21,567)   (8.7)      (21,288)   (5.6)
Extraordinary loss, net of tax................         --      0.0             --     0.0        (1,038)   (0.3)
                                                ---------    -----       --------   -----      --------   -----
Net loss......................................  $(365,468)   (96.0)%     $(21,567)   (8.7)%    $(22,326)   (5.9)%
                                                =========    =====       ========   =====      ========   =====
</TABLE>

    EBITDA represents earnings before interest, taxes, depreciation,
amortization, the impairment loss and restructuring and nonrecurring charges.
The Company believes that EBITDA may be useful for measuring the Company's
ability to service debt, to make new investments and to meet working capital
requirements. EBITDA as calculated by the Company may not be consistent with
calculations of EBITDA by other companies. EBITDA should not be considered in
isolation from or as a substitute for net income (loss), cash flows from
operating activities or other statements of operations or cash flows prepared in
accordance with generally accepted accounting principles or as a measure of
profitability or liquidity. None of the unaudited pro forma financial data, as
adjusted, purports to represent what the Company's combined results of
operations would have been or may be for any future period and all such
information should be read only in conjunction with the Company's Consolidated
Financial Statements and the Notes thereto included elsewhere in this Annual
Report on Form 10-K.

LIQUIDITY AND CAPITAL RESOURCES

    The operating environment confronting the Company raises uncertainty about
the Company's ability to continue as a going concern. The principal conditions
giving rise to that uncertainty include the following:

    - The Company has incurred losses and negative operating cash flows in every
      fiscal period since its inception. For the year ended December 31, 2000,
      the Company incurred a loss from continuing operations of approximately
      ($364.8) million, which included a goodwill impairment loss of
      approximately ($307.0) million, and negative operating cash flows of
      approximately ($26.0) million.

                                       33
<PAGE>
    - As of December 31, 2000, the Company had negative working capital of
      approximately ($58.7) million, which included ($29.9) million related to
      the Amended Credit Agreement (as defined) and ($19.0) million related to
      the First Union Amended Credit Agreement (as defined). Both Agreements
      expire in March 2002.

    - During 2000, the Company's primary stockholder provided approximately
      $43.3 million of funds to the Company and participated in the First Union
      Amended Credit Agreement, both of which provided liquidity to meet the
      current obligations under the Company's various debt agreements. During
      the quarter ended March 31, 2001, the primary stockholder provided
      approximately $12.0 million of funds to the Company.

    - The share price of the Company's Common Stock has decreased from $15.50 in
      the first quarter of 1999 to a low of $0.19 in the fourth quarter of 2000.

    - The rating of Company's public debt, the Registered Notes, was downgraded
      to a CCC- in December 2000. Based on recent trading, the Registered Notes
      have an aggregate fair value of approximately $11.3 million.

    During the latter part of 2000, the Company implemented an aggressive
initiative designed to improve efficiency and reduce costs. The Company reduced
its workforces by approximately 6%, providing $11.5 million in annual savings,
and consolidated 15 offices (17% of the occupied facilities). The Company also
made changes to its organizational structure to focus on the key components of
the business, improve financial reporting systems and controls, and develop a
more effective sales and marketing strategy.

    Management believes that the successful implementation of the initiatives
will enable the Company to achieve profitability. Management believes that the
cost reductions, improved financial and operating controls, and a focused sales
and marketing effort should provide positive results from operations and cash
flows in the near term. Management also believes that the long-term benefits of
the plan will stabilize the Company and improve its financial ratios.

    Achievement of projected cash flows from operations, however, will be
dependent upon the Company's attainment of forecasted revenues, improved
operating costs and trade support levels that are consistent with its financial
plans. Such operating performance will be subject to financial, economic and
other factors affecting the industry and operations of the Company, including
factors beyond its control, and there can be no assurance that the Company's
plans will be achieved. In addition, the Company borrows funds on a variable
rate basis, and continued compliance with loan covenants is partially dependent
on relative interest rate stability. If projected cash flows from operations are
not realized, or if there are significant increases in interest rates, then the
Company may have to explore various available alternatives, including obtaining
further modifications of its existing lending arrangements, renegotiating debt
payments associated with acquired companies, seeking additional contributions of
equity or loans from MS Acquisition or attempting to locate additional sources
of financing, all of which are beyond the Company's control and provide no
certainty of success.

    CASH FLOWS ACTIVITY FOR THE YEAR ENDED DECEMBER 31, 2000 COMPARED TO THE
     YEAR ENDED DECEMBER 31, 1999

    Net cash used in operating activities was approximately ($26.0) million for
2000, as compared to ($3.7) million for the same period in 1999. The Company's
net loss of approximately ($365.5) million for 2000 included approximately
$7.5 million in non-cash depreciation expense, a goodwill impairment loss of
approximately $307.0 million, $22.0 million in nonrecurring charges related to
trade receivables and severance and other benefits given to former employees,
and a $1.9 million noncash loss related to the sale of Buy Sell. Operating cash
flows for 2000 also included approximately ($23.0) million in net increases to
accounts receivable and approximately ($3.1) million in net decreases related to
accounts

                                       34
<PAGE>
payable and accrued expenses. The Company's net loss of approximately
($21.6) million for 1999 included approximately $3.8 million in noncash
depreciation expense and a $13.3 million restructuring charge related to vacated
leased facilities and terminated employees. Operating cash flows for the 1999
period also included approximately ($24.8) million in decreases related to
accounts payable and accrued expenses. The Company has utilized proceeds from
the sale of improved properties, additional funds available as a result of the
credit facility refinancings completed in the first quarter and fourth quarter
of 2000, and funds provided by MS Acquisition throughout the year to cover
working capital needs.

    Net cash used in investing activities was approximately ($4.8) million for
2000, as compared to approximately ($15.3) million for the same period in 1999.
Investing cash flows for the 2000 period included approximately $8.6 million in
cash proceeds related to the sale of the Company's Orange County, California and
Phoenix, Arizona properties in February 2000 and the sale of its Mecklenberg,
North Carolina property in December 2000. Investing cash flows for this period
also included approximately ($12.0) million in cash payments primarily related
to the purchases of Johnson-Leiber in January 2000 and Sales Force in April
2000. Investing cash flows for 1999 included approximately ($13.7) million in
net cash payments primarily related to the purchases of Sell, Inc. in January
1999, United Brokerage Company in April 1999, RMSI in August 1999, and Inman in
October 1999.

    Net cash provided by financing activities was approximately $33.7 million
for 2000, as compared to approximately $17.8 million for 1999. Financing cash
flows for 2000 included approximately $39.3 million in cash proceeds received
from MS Acquisition, which involved the issuance of Common Stock, $15.0 million
and convertible securities, $24.3 million throughout the year. A total of
$9.5 million of the convertible securities were converted into Common Stock in
the third quarter of 2000. A total of approximately $9.8 million of the
convertible securities existed as convertible debt at one point during the year
and was later converted into the Series B Preferred Stock in the fourth quarter
of 2000. In December 2000, the Company also received $4.0 million in proceeds
related to convertible securities that were issued in the first quarter of 2001.
Financing cash flows for 2000 also included approximately $28.6 million in net
short-term borrowings. These proceeds were offset by approximately
($5.7) million in cash payments primarily related to the refinancing of these
short-term borrowings throughout the year and approximately ($29.5) million in
principal payments in long-term obligations, of which approximately
($8.8) million related to the Initial Term Loan. Financing cash flows for 1999
included approximately $3.8 million in net proceeds from the issuance of Common
Stock and $20.3 million in net short-term borrowings. Financing cash flows for
1999 also included approximately ($21.2) million in principal payments on
long-term obligations.

    SENIOR SUBORDINATED NOTES

    In December 1997, concurrently with the sale by RMSI of $100.0 million of
the Issued Notes, RMSI entered into an Exchange and Registration Rights
Agreement with the initial purchaser of the Issued Notes. Under the terms of
that agreement, RMSI agreed to file a registration statement regarding the
exchange of the Issued Notes for new notes registered under the Securities Act
of 1933, and to offer the holders of the Issued Notes an opportunity to exchange
their unregistered notes for registered notes.

    On June 21, 1999, RMSI filed a Registration Statement on Form S-4 with the
Securities and Exchange Commission to register $100.0 million of the Registered
Notes. Subsequently, RMSI completed an exchange of the Issued Notes for the
Registered Notes. The Registered Notes are identical in all material respects to
the Issued Notes, except for transfer restrictions and registration rights. The
Company assumed this outstanding indebtedness in connection with the Merger.

    The Registered Notes are unsecured and are subordinated in right of payment
to all existing and future senior indebtedness of the Company. The Registered
Notes are fully and unconditionally guaranteed on an unsecured, senior
subordinated, joint and several basis by certain guarantor wholly-

                                       35
<PAGE>
owned subsidiaries of the Company as defined in the Registration Statement,
which comprise substantially all the direct and indirect subsidiaries of the
Company. The Company is a holding company with no assets, liabilities or
operations other than its interests in its subsidiaries. Separate financial
statements and other disclosures for such subsidiaries have not been presented
due to management's determination that such information is not material to
investors.

    Interest on the Registered Notes is payable semiannually on June 15 and
December 15 of each year, commencing June 15, 1998. The principal on the
Registered Notes is payable on December 15, 2007, the maturity date. The Company
may not redeem the Registered Notes prior to December 15, 2002, except as
described below. On or after such date, the Company may redeem the Registered
Notes, in whole or in part, at the following redemption prices: 2002-105.063%;
2003-103.375%; 2004-101.688%; 2005 or thereafter-100.000%, together with accrued
and unpaid interest, if any, to the date of redemption. The Registered Notes are
not subject to any sinking fund requirement. Upon a change of control, as
defined (not triggered by the Merger), each holder of the Registered Notes will
have the right to require the Company to make an offer to repurchase such
holder's Registered Notes at a price equal to 101% of the principal amount
thereof, together with accrued and unpaid interest, if any, to the date of
repurchase.

    The Registered Notes subject the Company to certain limitations and
restrictions primarily related to obtaining additional indebtedness, payment of
dividends, and sales of assets and subsidiary stock, which may require the
consent of the holders of the Registered Notes.

    In December 2000, the rating of the Registered Notes was lowered to CCC-.
Based on recent trading information, the fair value of the Registered Notes is
approximately $11.3 million, as compared to a carrying value of $100.0 million.

    REFINANCING OF COMPANY'S EXISTING CREDIT FACILITY

    INITIAL CREDIT FACILITY

    In connection with the Offering and Combination, the Company obtained a
$75.0 million Initial Credit Facility (as amended on August 18, 1999) from a
bank. The Initial Credit Facility consisted of a five-year, secured, fully
amortizing $50.0 million Initial Term Loan and a three-year, secured
$25.0 million Initial Revolving Credit. The balance outstanding under the
Initial Credit Facility was $64.1 million as of December 31, 1999
($20.3 million under the revolver and $43.8 million under the term loan).
Amounts outstanding under this facility were collateralized by substantially all
of the Company's assets.

    Interest was payable on the Initial Term Loan and the Initial Revolving
Credit at the base rate, as defined in the amended Initial Credit Facility. The
rate on the outstanding balance of the Revolver and the Initial Term Loan was
9.16% and 10.50%, respectively, as of December 31, 1999. The Initial Credit
Facility required the Company to make certain mandatory prepayments of amounts
outstanding under the Initial Credit Facility with the use of certain proceeds
from asset sales and debt and equity financing.

    The amended Initial Credit Facility required the Company to comply with
various affirmative and negative covenants, including the following, among
others:

    - the maintenance of certain financial ratios

    - restrictions on certain additional indebtedness

    - restrictions on liens, guarantees, dividends and the disposition of assets

                                       36
<PAGE>
    - obtaining the lenders' consent to acquisitions involving cash
      consideration in excess of a specified amount

    AMENDED TERM LOAN

    On March 30, 2000, the Company became a party to the Amended Term Loan. The
Amended Term Loan consisted of a two-year, secured $35.0 million term loan. The
Company paid commitment and other fees of approximately $0.9 million in
connection with obtaining the Amended Term Loan. Under the Amended Term Loan,
the principal amount of the term loan was reduced from $43.8 million to
$35.0 million.

    The Amended Term Loan was secured by a lien on substantially all of the
Company's and its subsidiaries' tangible and intangible property. In addition,
the Amended Term Loan was jointly and severally guaranteed by all current and
future subsidiaries of the Company. Interest was payable on the Amended Term
Loan at a rate based on one of two customary interest rates plus an additional
interest margin of 375 or 500 basis points, as applicable.

    The Amended Term Loan contained customary events of default, including
cross-default provisions relating to the Registered Notes.

    In connection with the Amended Term Loan, the Company issued to an affiliate
of First Union National Bank, N.A. detachable warrants to purchase up to 4.0% of
the Company's Common Stock on a diluted basis. The exercise price of the
warrants will be nominal, and the warrants will be exercisable at any time after
the second anniversary of the issuance of the warrants. The proceeds of the
Amended Term Loan were allocated between debt and warrants based on their
respective fair market values. The estimated fair value of the warrants appears
as a component of Additional Paid-In Capital in the accompanying Consolidated
Balance Sheet as of December 31, 2000.

    The letter of credit outstanding under the Initial Credit Facility was
replaced by a $1.1 million letter of credit issued for the account of RCPI,
which is an affiliate of MS Acquisition, the Company's largest shareholder. The
Company issued to RCPI a reimbursement note subordinated in right of payment to
the Registered Notes in the amount of the letter of credit. The promissory note
will become payable if the letter of credit is drawn.

    NEW REVOLVER

    On March 30, 2000, the Company also became a party to New Revolver. The New
Revolver consisted of a two-year, senior secured $50.0 million revolving line of
credit, subject to a borrowing base equal to a specified percentage of eligible
receivables. The Company paid commitment and other fees of approximately
$0.6 million in connection with obtaining the New Revolver. Funds advanced under
the New Revolver were used by the Company to repay a portion of outstanding
amounts under the Initial Credit Facility, to partially finance the acquisition
of Sales Force, to finance the Company's working capital and capital expenditure
requirements in the ordinary course of business, and to pay fees and expenses
relating to the closing of the New Senior Credit Facility. The New Revolver
contained customary events of default, including cross-default provisions
relating to the Registered Notes.

    The New Revolver was secured by a first priority security interest in cash,
cash equivalents, accounts receivable and inventory of the Company and its
subsidiaries and proceeds thereof but not in assets that are the proceeds of
equipment, fixtures, real estate, intellectual property or the stock of
subsidiaries. In addition, Inman, MSSC and Bromar were co-borrowers under the
New Revolver, jointly and severally liable for all borrowings and other related
obligations thereunder. Interest was payable on the New Revolver at a rate based
on one of two customary interest rates plus an additional interest

                                       37
<PAGE>
margin ranging from 150 to 350 basis points. The applicable margin was
determined based on certain financial ratios of the Company.

    The New Senior Credit Facility required the Company to comply with various
affirmative and negative covenants, including, among others:

    - the maintenance of certain financial ratios

    - restrictions on additional indebtedness

    - restrictions on liens, guarantees, dividends and the disposition of assets

    - restrictions on certain mergers, consolidations, and acquisitions

    During 2000, the Company incurred approximately $5.3 million in costs
primarily related to the New Senior Credit Facility.

    FIRST UNION AMENDED CREDIT AGREEMENT

    On November 17, 2000, the Company also became party to the First Union
Amended Credit Agreement. The First Union Amended Credit Agreement amends the
Amended Term Loan and provides for the consent of First Union National Bank,
N.A. to the Increase, the Borrowing Base Amendment, and the repayment of the
$2.5 million promissory note to MS Acquisition. The First Union Amended Credit
Agreement also amends the Amended Term Loan to reflect the terms of the Amended
Credit Agreement. As of December 31, 2000, the discounted carrying amount under
the First Union Amended Credit Agreement was approximately $33.9 million. At
December 31, 2000, the Company was not in compliance with certain covenants
related to this agreement. See "Amended Senior Credit Facility Amendments" below
for discussion of these violations and related waivers and amendments.

    AMENDED CREDIT AGREEMENT

    On November 17, 2000, the Company became party to the Amended Credit
Agreement. The Amended Credit Agreement provides for the Increase, which is
comprised of the Tranche A Note and the Tranche B Note. MS Acquisition purchased
a 100% participation interest in the Tranche B Note.

    The Tranche A Note provides for the Amended Revolver, which accrues interest
at a rate equal to the Base Rate (a reference rate based on the prime rate) plus
2.25%. The Amended Revolver will revolve up to the lesser of $41.0 million or
the Borrowing Base, which is a function of the Company's eligible receivables
and the Advance Percent determined by the Agent. As part of the Amended Credit
Agreement, the Agent has decreased the Advance Percent, thereby decreasing the
Borrowing Base (the "Borrowing Base Amendment"). The Company must fulfill all
payment obligations under the Amended Revolver before making any interest
payments on the Tranche B Note. The Tranche A Note and any accrued and unpaid
interest will mature on March 30, 2002. As of December 31, 2000, the outstanding
amount under the Amended Revolver was approximately $29.9 million, and
approximately $0.9 million was available.

    The Tranche B Note bears interest at a rate equal to the Base Rate plus
2.25%. The Tranche B Note and any accrued and unpaid interest will mature on
March 30, 2002. The fixed commitment under the Tranche B Note is not subject to
the Borrowing Base. As discussed in Note 9 of the Company's Notes to
Consolidated Financial Statements, MS Acquisition funded the $19.0 million
balance of the Tranche B Note, subject to the terms of a master participation
agreement. As of December 31, 2000, the outstanding amount under the Tranche B
Note was $19.0 million. At December 31, 2000, the Company was not in compliance
with certain covenants related to this agreement. See "Amended Senior Credit
Facility Amendments" below for discussion of these violations and related
waivers and amendments.

                                       38
<PAGE>
    AMENDED SENIOR CREDIT FACILITY AMENDMENTS

    As of March 30, 2001, the Company was in violation of certain covenants
under the Amended Credit Agreement and the First Union Amended Credit Agreement
(collectively referred as the "Amended Senior Credit Facility") in connection
with (i) its failure to provide annual financial statements within ninety (90)
days of its fiscal year end, (ii) the certifying accountant's qualification of
the Company's annual financial statements on a going concern basis, and
(iii) the Company's failure to deliver certain items to the Agent by March 15,
2001 as required by the Amended Credit Agreement. On April 19, 2001, the Company
entered into (a) a Waiver and Third Amendment to Credit Agreement amending the
Amended Credit Agreement and (b) Second Amendment to Credit Agreement amending
the First Union Amended Credit Agreement ((a) and (b) collectively defined as
the "Amended Senior Credit Facility Amendments").

    Under the Amended Senior Credit Facility Amendments, the Company
(i) received a waiver for its current defaults under the Amended Senior Credit
Facility and (ii) paid a fee of approximately $0.2 million as consideration in
obtaining the amendments and waiver of the defaults under the Amended Credit
Agreement. The Amended Senior Credit Facility Amendments provide, among other
things, that (i) the Agent may increase the Advance Percent as of March 31,
2001, but before June 1, 2001, thereby increasing the Borrowing Base under the
Amended Senior Credit Facility, (ii) amends the definition of "EBITDA" in the
Amended Senior Credit Facility to include certain write-offs in the amortization
and depreciation expense deducted in determining Net Income, and (iii) amends
the baseline amounts for determining Minimum EBITDA. Under the Amended Senior
Credit Facility Amendments, the Company must meet certain post-closing
covenants, including, among other things, the delivery of its annual financial
statements by April 27, 2001 and the delivery of certain other items by May 31,
2001.

    OTHER NOTES PAYABLE INVOLVING RELATED PARTIES

    The Company also has a mortgage note with RCPI., an affiliate of MS
Acquisition, that is secured by certain land, a building and fixtures. It bears
interest at 8.5% with monthly payments of approximately $34,000 (including
interest) and a balloon payment of approximately $3.6 million due in 2001. The
balance outstanding under this mortgage was approximately $3.6 million as of
December 31, 2000.

    On November 9, 2000, the Company issued a $2.5 million promissory note to MS
Acquisition. This promissory note is subordinate to the senior debt of the
Company. The proceeds were used for general corporate purposes. The
$2.5 million promissory note bears interest at a rate equal to the sum of an
interest margin of 2.75% plus the applicable prime rate on the last business day
of the quarter for which interest is payable. Interest is payable quarterly in
arrears, commencing on December 31, 2000, and will continue through the maturity
date. The $2.5 million promissory note and any unpaid and accrued interest will
be payable on November 9, 2002, or on demand, under specified conditions.

    The Company is not permitted to repay the principal and unpaid and accrued
interest on the $2.5 million promissory note on demand if the Company's
borrowing base 30 days prior to a payment date is not at least $10.0 million, or
25% of the sum of the Company's payroll for the last four consecutive pay
periods, whichever is greater. In the first quarter of 2001, the $2.5 million
promissory note was converted into redeemable convertible preferred stock. See
Note 20 of the Company's Notes to Consolidated Financial Statements for
additional information.

    The Company had other notes payable to former employees of various acquired
entities of approximately $8.5 million as of December 31, 2000. The total
estimated payments have been discounted at rates ranging from 8% to 10%. The
amounts due under the acquisition agreements are unsecured and extend through
2011. These amounts are payable in either monthly or quarterly installments. The
fair value of these obligations approximates their carrying value.

                                       39
<PAGE>
    COMMON STOCK TRANSACTIONS

    On January 7, 2000, the Company issued 1,577,287 shares of Common Stock to
MS Acquisition for an aggregate purchase price of $5.0 million ($3.17 per share)
pursuant to the terms of a stock purchase agreement. On March 30, 2000, MS
Acquisition purchased an additional 4,000,000 shares of Common Stock for an
aggregate purchase price of $10.0 million ($2.50 per share) pursuant to the
terms of a stock purchase agreement. The Company used the funds as an additional
source of capital for operations and additional short-term and long-term
liquidity. The offering, sale and issuance of these shares was exempt from
registration under the Securities Act pursuant to a private offering exemption
under Section 4(2) promulgated thereunder.

    As indicated in Note 14 of the Company's Notes to Consolidated Financial
Statements, the 9,500 outstanding shares of the Preferred Stock held by MS
Acquisition were converted into 6,234,414 shares of Common Stock.

    REDEEMABLE CONVERTIBLE PREFERRED STOCK TRANSACTIONS

    UNDESIGNATED PREFERRED STOCK

    As of December 31, 2000, there were no shares of undesignated preferred
stock outstanding. Holders of undesignated preferred stock would have priority
over the holders of Common Stock with respect to dividends and to other
distributions, including the distribution of assets upon liquidation. The Board
of Directors has the authority, without stockholder authorization, to issue
shares of undesignated preferred stock in one or more series and to fix the
terms, limitations, relative rights and preferences and variations.

    PREFERRED STOCK

    On June 23, 2000, the Board of Directors of the Company authorized and
provided for the issuance of up to 10,000 shares of 8.0% Convertible
Paid-In-Kind Preferred Stock, par value $0.01 per share, with a stated value of
$1,000 per share (the "Preferred Stock"). Each share of the Preferred Stock is
convertible into that number of shares of Common Stock equal to the result
obtained by dividing the stated value of the Preferred Stock by the conversion
price in effect at the conversion date.

    All dividends on issued shares of the Preferred Stock are cumulative,
whether or not the dividends are earned or declared, on a daily basis from the
issue date and payable quarterly in arrears on each dividend payment date. Even
if not declared, all unpaid dividends will compound quarterly at an annual
dividend rate equal to 8.0%, or the applicable dividend rate.

    On June 22, 2010, the Company will be obligated to redeem, to the extent of
funds legally available, all outstanding shares of the Preferred Stock at a
redemption price equal to 100% of the liquidation preference per share. The
liquidation preference per share will be equal to the greater of $1,000 per
share or the amount that the equivalent number of shares of Common Stock (based
on the conversion rate applicable at the liquidation date) would be entitled to
receive, plus any unpaid dividends.

    On June 23, 2000, the Company issued 5,000 shares of Preferred Stock to MS
Acquisition for an aggregate purchase price of $5.0 million pursuant to the
terms of a preferred stock purchase agreement. On August 8, 2000, the Company
issued 4,500 additional shares of Preferred Stock to MS Acquisition for an
aggregate purchase price of $4.5 million pursuant to the terms of a preferred
stock purchase agreement.

    On July 27, 2000, the Company received early termination of the waiting
period in connection with its Hart-Scott-Rodino Antitrust Improvement Act filing
thereafter allowing the conversion of the Preferred Stock to Common Stock of the
Company. On August 21, 2000, the 9,500 shares of Preferred

                                       40
<PAGE>
Stock, previously issued to MS Acquisition, were converted into 6,234,414 shares
of Common Stock. Per the terms of the preferred stock purchase agreements, each
share of Preferred Stock was converted into approximately 656.25 shares of
Common Stock (i.e., the Preferred Stock's stated value of $1,000 divided by the
conversion price of $1.5238).

    On August 17, 2000, the Company issued a $4.75 million promissory note to MS
Acquisition. On August 30, 2000, the Company issued a $5.0 million promissory
note to MS Acquisition. The Registered Notes and the New Senior Credit Facility
are senior to these notes. The Company used the proceeds from both promissory
notes for general corporate purposes.

    On November 1, 2000, the Company's Board of Directors authorized the
issuance of up to 20,000 shares of the Series B Preferred Stock. The Series B
Preferred Stock has a stated value of $1,000 per share. The Series B Preferred
Stock is of equal class with the Preferred Stock previously authorized and any
future designated series of preferred stock unless specifically noted in future
preferred stock agreements. The Series B Preferred Stock has the same
characteristics (i.e., dividend terms, conversion features) as the Preferred
Stock.

    SERIES B PREFERRED STOCK

    On November 1, 2000, the Company issued 12,397 shares of the Series B
Preferred Stock to MS Acquisition for an aggregate purchase price of
approximately $12.4 million pursuant to the terms of a preferred stock purchase
agreement. The purchase price consisted of the cancellation of the
$4.75 million promissory note and the $5.0 million promissory note, including
all accrued and unpaid interest, plus an additional cash payment of
approximately $2.5 million to the Company. The incremental proceeds from the
issuance of the Series B Preferred Stock were used for general corporate
purposes.

    On November 9, 2000, the Company issued a $2.5 million promissory note to MS
Acquisition. This promissory note is subordinate to the senior debt of the
Company. The proceeds were used for general corporate purposes. The
$2.5 million promissory note bears interest at a rate equal to the sum of an
interest margin of 2.75% plus the applicable prime rate on the last business day
of the quarter for which interest is payable. Interest is payable quarterly in
arrears, commencing on December 31, 2000, and will continue through the maturity
date. The $2.5 million promissory note and any unpaid and accrued interest will
be payable on November 9, 2002, or on demand, under specified conditions. The
Company is not permitted to repay the principal and unpaid and accrued interest
on the $2.5 million promissory note on demand if the Company's borrowing base
30 days prior to a payment date is not at least $10.0 million, or 25% of the sum
of the Company's payroll for the last four consecutive pay periods, whichever is
greater. In the first quarter of 2001, the $2.5 million promissory note was
converted into redeemable convertible preferred stock. See Note 20 of the
Company's Notes to Consolidated Financial Statements for additional information.

    On January 26, 2001, the Company issued 7,568 shares of the Series B
Preferred Stock to MS Acquisition for an aggregate purchase price of
approximately $7.6 million pursuant to the terms of a preferred stock purchase
agreement. The purchase price consisted of the cancellation of the $2.5 million
promissory note, including all accrued and unpaid interest, plus an additional
cash payment of approximately $5.0 million to the Company. A total of
$4.0 million of the cash proceeds were received in December 2000 and appeared as
a component of Other Liabilities in the consolidated balance sheet as of
December 31, 2000. The incremental proceeds from the issuance of the Series B
Preferred Stock were used for general corporate purposes.

    SERIES C PREFERRED STOCK

    On March 26, 2001, the Company's Board of Directors authorized the issuance
of up to 20,000 shares of the Series C Preferred Stock. The Series C Preferred
Stock has a stated value of $1,000 per

                                       41
<PAGE>
share. The Series C Preferred Stock is of equal class with the Preferred Stock
and the Series B Preferred Stock previously authorized and any future designated
series of preferred stock unless specifically noted in future preferred stock
agreements.

    Each share of the Series C Preferred Stock is convertible into that number
of shares of Common Stock equal to the result obtained by dividing the stated
value of the Series C Preferred Stock by the conversion price in effect at the
conversion date.

    All dividends on issued shares of the Series C Preferred Stock are
cumulative, whether or not the dividends are earned or declared, on a daily
basis from the issue date and payable quarterly in arrears on each dividend
payment date. Even if not declared, all unpaid dividends will compound quarterly
at an annual dividend rate equal to 8.0%, or the applicable dividend rate.

    On June 22, 2010, the Company will be obligated to redeem, to the extent of
funds legally available, all outstanding shares of the Series C Preferred Stock
at a redemption price equal to 100% of the liquidation preference per share. The
liquidation preference per share will be equal to the greater of $1,000 per
share or the amount that the equivalent number of shares of Common Stock (based
on the conversion rate applicable at the liquidation date) would be entitled to
receive, plus any unpaid dividends.

    On March 28, 2001, the Company issued 9,000 shares of the Series C Preferred
Stock to MS Acquisition for an aggregate purchase price of $9.0 million in cash
pursuant to the terms of a preferred stock purchase agreement. The proceeds from
the issuance of the Series C Preferred Stock were used for general corporate
purposes.

    On March 30, 2001, the Company issued 2,000 shares of the Series C Preferred
Stock to MS Acquisition for an aggregate purchase price of $2.0 million in cash
pursuant to the terms of a preferred stock purchase agreement. The proceeds from
the issuance of the Series C Preferred Stock were used for general corporate
purposes.

SEASONALITY; FLUCTUATIONS IN QUARTERLY OPERATING RESULTS

    The Company has experienced and expects to continue to experience
fluctuations in quarterly revenues and operating results as a result of seasonal
patterns. The revenues of the Company have been stronger in the third and fourth
calendar quarters as a result of the historically strong sales associated with
consumer consumption during the holiday season and weaker in the first quarter
following such season. Results of operations for any particular quarter
therefore are not necessarily indicative of the results of operations for any
future period. Future seasonal and quarterly fluctuations could have a material
adverse effect on the Company's business, financial condition and results of
operations.

INFLATION

    The Company does not believe that its revenues have been materially affected
by inflation.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

    The Company is exposed to market risk related to its credit facility as
discussed in the accompanying Notes to the Consolidated Financial Statements.
The interest on the credit facility is subject to fluctuations in the market. A
1% increase in the interest rates applicable to the credit facility would result
in a $0.5 million reduction of the Company's financial position, results of
operations, and cash flows.

    The Company does not engage in trading market risk sensitive instruments and
does not purchase as investments, as hedges, or for purposes "other than
trading", instruments that are likely to expose

                                       42
<PAGE>
the Company to certain types of market risk, including interest rate, commodity
price or equity price risk. The Company has not entered into any forward or
futures contracts, purchased any options or entered into any swaps.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

    The Financial Statements and Financial Statement Schedule filed as a part of
this Annual Report on Form 10-K are listed on the Index to Consolidated
Financial Statements and Consolidated Financial Statement Schedule on page F-1.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

    As reported in the Company's Current Report on Form 8-K dated December 1,
2000 (the "December 2000 8-K"), following the consummation of the Merger, the
Company continued its engagement of its certifying accountant, Arthur
Andersen, LLP ("Andersen"). The Company then determined that it was in its best
interests to change auditors. Therefore, effective December 1, 2000, Andersen
was dismissed and PricewaterhouseCoopers LLP ("PwC") replaced Andersen as the
ongoing certifying accountant for the Company. This change was recommended and
approved by the Company's Audit Committee-(as defined in Item 10) and Board of
Directors effective as of December 1, 2000.

    The reports of Andersen for the past two fiscal years contained no adverse
opinion or disclaimer of opinion and were not qualified or modified as to
uncertainty, audit scope, or accounting principles. During the Company's two
most recent fiscal years, subsequent interim periods preceding the date of the
December 2000 8-K, or since there were no:

    (i) Disagreements between the Company and Andersen on any matter of
        accounting principles or practices, financial statement disclosure, or
        auditing scope or procedure which, if not resolved to the satisfaction
        of Andersen, would have caused them to make reference to the subject
        matter of the disagreement or disagreements in their reports on the
        financial statements for such years.

    (ii) Reportable events involving Andersen that would have required
         disclosure under Item 304(a)(1)(v) of Regulation S-K.

    The Company requested, and Andersen furnished, a letter addressed to the SEC
(as of December 1, 2000) stating that Andersen agreed with the above statements
that pertain to Andersen. A copy of such letter, dated December 1, 2000, was
filed as Exhibit 16.1 to the December 2000 8-K.

                                       43
<PAGE>
                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

    The following table sets forth information concerning the Company's
directors and executive officers and the offices held by each on March 15, 2001:

<TABLE>
<CAPTION>
NAME                                           AGE                         POSITION
----                                         --------   -----------------------------------------------
<S>                                          <C>        <C>
Ronald D. Pedersen.........................     61      Chairman of the Board, Director

Gerald R. Leonard..........................     54      President, Chief Executive Officer and Director

Timothy M. Byrd............................     46      Chief Financial Officer and Director

John P. Rochon.............................     49      Director

Nick G. Bouras.............................     48      Director

Michael J. Merriman(1).....................     44      Director

James A. Schlindwein(1)(2).................     72      Director

Glenn F. Gillam............................     49      Chief Operations Officer

Jay DiNucci................................     37      Vice President, Controller

Shannon Tvrdik.............................     32      Treasurer

Bruce A. Butler............................     52      President of Brand Development
</TABLE>

------------------------

(1) Audit Committee Member

(2) Compensation Committee Member

    RONALD D. PEDERSEN has served as Chairman of the Board of Directors of the
Company since the consummation of the Merger. His current term as Director
expires in 2002. He formerly served as President, Chief Executive Officer and as
a Director of RMSI. Mr. Pedersen has also served during 1999 as President, Chief
Executive Officer of MSSC and currently serves as a director of MSSC.
Mr. Pedersen has been in the food industry for over 30 years, including three
years with Anderson Clayton foods and seven years with Colgate Palmolive. He is
past Chairman and current member of the Board of the Association of Sales and
Marketing Companies. Mr. Pedersen is the father-in-law of Mr. DiNucci.

    GERALD R. LEONARD has been Chief Executive Officer and President of the
Company since the consummation of the Combination. His current term as Director
expires in 2002. Effective March 2, 2000, Mr. Leonard became President and Chief
Executive Officer of MSSC. Mr. Leonard was previously Chief Executive Officer of
Merkert from September 1994 until December 1998, and served as the President of
Merkert from September 1994 until June 1998. From May 1992 to September 1994,
Mr. Leonard served Merkert as President of the Food Enterprises, New England
Division, and has been with Merkert in various executive capacities since 1983.

    TIMOTHY M. BYRD has been a Director of the Company since the consummation of
the Merger. He has served as the Chief Financial Officer of the Company from
September 1999 to August 2000, and from December 2000 to present. His current
term as Director expires in 2001. He was previously the Chief Administrative
Officer, Assistant Treasurer and a Director of RMSI. Mr. Byrd served as a
Director of RMSI from 1997 until the Merger. Mr. Byrd has also served as Chief
Administrative Officer of MSSC since September 1998 and as a Director of MSSC
since 1996. Since 1990, Mr. Byrd has been the Chief Financial Officer of Mary
Kay Holding Corporation as well as the Chief Financial Officer of Richmont
Corporation. From 1980 to 1990, Mr. Byrd served in various accounting and

                                       44
<PAGE>
finance positions at Mary Kay, Inc., including Chief Financial Officer, Vice
President and Controller. He is also a member of the Office of the Chairman of
Mary Kay Holding Corporation.

    JOHN P. ROCHON has been a Director of the Company since the consummation of
the Merger. His current term as Director expires in 2003. He was previously the
Chairman of the Board of Directors of RMSI and served in that capacity and as a
Director from 1997 until the closing of the Merger. Mr. Rochon has served on the
Board of Directors of MSSC since 1996 and is currently Chairman of the Board of
Directors of Richmont Corporation, a merchant banking, investment holding and
trading company, and Chief Executive Officer of Mary Kay Holding Corporation, a
role he has had since 1991. Formerly, Mr. Rochon held several executive
positions with Mary Kay, Inc., including Vice Chairman, Chief Financial Officer,
Controller and Director of Manufacturing. Mr. Rochon currently serves as
Chairman of the Board of Directors of Nu-kote Holding, Inc. and Director of
Royal Appliance Mfg. Co.

    NICK G. BOURAS has been a Director of the Company since consummation of the
Merger. He formerly served as Vice President, Assistant Secretary and as a
Director of RMSI. His current term as Director expires in 2002. He is Vice
President, Assistant Secretary and a Director of MSSC. Mr. Bouras has been
President and Chief Executive Officer of Richmont Corporation since 1989. Prior
to his role at RMSI, Mr. Bouras was Vice President, Investments of Mary
Kay, Inc. Mr. Bouras also spent several years as a tax accountant with Ernst &
Young and Touche Ross & Company.

    MICHAEL J. MERRIMAN has served as Director of the Company since the
consummation of the Merger. His current term as Director expires in 2003. He has
also served as a Director of Royal Appliance Mfg. Co., the parent company of
Dirt Devil, Inc., since 1993. Mr. Merriman was appointed Chief Executive Officer
of Royal Appliance in July 1995 and President and Chief Operating Officer in
January 1995. From May 1992 until his appointment as President, he had been Vice
President--Finance, Treasurer and Secretary of Royal Appliance. RCPI owns
approximately 21.6% of the common stock of Royal Appliance.

    JAMES A. SCHLINDWEIN has been a Director of the Company since the
consummation of the Combination. His current term as Director expires in 2001.
Prior to his retirement in September 1994, Mr. Schlindwein served as Executive
Vice President and a director of Sysco Corporation, a national institutional
food service distributor, where he had served since 1980. He is also a director
of EMMPAK Foods, Inc., Alaska Seafood International, Agra Quest, Inc., Chilay
Corporation, Thompson's Pet Pasta Products, Inc. and Egg Innovations, Inc.

    GLENN F. GILLAM recently became Chief Operating Officer for the Company.
Previously, Mr. Gillam served as the President of Broker Operations and as the
President of the Northern Division. He joined Merkert in 1983 and has held
numerous sales and management positions. From 1994 until 1998, Mr. Gillam served
as President of the Food Enterprises, New England Division, of Merkert.

    JAY DINUCCI has served as Vice President and Corporate Controller of the
Company since the Merger, and held such title with RMSI from January 1996. From
1993 to 1995, Mr. DiNucci served in various financial, accounting and
administrative positions at MSSC. Mr. DiNucci has been in the food industry for
over eight years. Prior to joining MSSC, he worked in various financial and
accounting positions with Fortune 500, international and start-up companies.
Mr. DiNucci is the son-in-law of Mr. Pedersen.

    SHANNON F. TVRDIK has served as Treasurer of the Company since March 13,
2000. She served as the Controller for the Northern Division and Director of
Financial Planning and Acquisitions within the Company since the Merger, and
held such title with RMSI from August 1997. From 1994 to 1997, Ms. Tvrdik served
in various finance positions at Richmont Corporation. She is also a member of
the Office of the Chairman of Mary Kay Holding Corporation. Ms. Tvrdik has over
nine years of financial

                                       45
<PAGE>
experience and prior to joining Richmont Corporation, she worked in the special
services consulting group of Ernst & Young LLP.

    BRUCE A. BUTLER has served as President of Brand Development since
January 2000. He formerly served as Chief Operating Officer of the Company from
the consummation of the Merger until his appointment as President of Brand
Development. He was formerly the Executive Vice President and a Director of
RMSI. He served as a Director of RMSI from 1997 until the Merger. Mr. Butler has
held several positions since 1991, including Vice President-Branch Manager,
Tampa Operations and Director of Confection, and currently serves as MSSC's
Executive Vice President. Mr. Butler is responsible for all operating units in
MSSC and is a member of the Board of Directors of MSSC. Mr. Butler began his
career with MSSC when his former employer, the Trigg Company, Inc., was acquired
by MSSC in 1991. Prior to that time, Mr. Butler held management positions with
the Kroger Company and Inman.

    BOARD OF DIRECTORS

    The business is managed under the direction of the Board of Directors and is
fixed by resolution duly adopted from time to time by the Board of Directors.
The Company's Second Amended and Restated Certificate of Incorporation provided
that the Board shall be divided into two classes until a third class is elected
at the annual meeting of stockholders in 2000. From and after such date, the
Board shall be divided into three classes, as nearly equal as possible. The
Class I directors who were elected at the annual meeting of stockholders in 1999
were elected to hold office for a term expiring at the annual meeting of
stockholders held in 2001. The initial Class II directors were elected to hold
office for a term expiring at the annual meeting of stockholders to be held in
2000. Under the direction of the Board, it was approved instead that all
Class I, II and III directors would be elected at the annual meeting of
stockholders meeting in 2000. The Company's stockholders thereupon elected three
successor Class I directors, three successor Class II directors and two
Class III directors. The successor Class I directors who were elected are to
serve as Class I directors until the 2001 annual meeting of stockholders and
until their successors are duly elected and qualified. These individuals are
Timothy M. Byrd, Ronald D. Pedersen and James A. Schlindwein. Also, the
successor Class II directors who were elected are to serve as Class II directors
until the 2002 annual meeting of stockholders and until their successors are
duly elected and qualified. These individuals are Nick G. Bouras, Gerald R.
Leonard and Edward P. Grace, III. Mr. Grace resigned subsequent to the 2000
annual meeting of the stockholders. In addition, two Class III directors were
elected as Class III directors until the 2003 annual meeting of stockholders and
until their successors are duly elected and qualified. These individuals are
John P. Rochon and Michael J. Merriman.

    MEETINGS OF BOARD OF DIRECTORS AND COMMITTEES

    The Board of Directors has established an audit committee (the "Audit
Committee") and a compensation committee (the "Compensation Committee"). The
Audit Committee, currently consists of Messrs. Merriman and Schlindwein, after
the resignation of Mr. Grace from the Board. The Audit Committee generally meets
on a quarterly basis, but met two times in 2000. The Audit Committee recommends
to the Board of Directors the firm to be appointed as independent accountants to
audit financial statements and to perform services related to the audit. The
Audit Committee also reviews the scope and results of the audit with the
independent accountants, reviews with management and the independent accountants
the Company's year-end operating results and the accounting issues facing the
Company, considers the adequacy of the internal accounting procedures and
considers the effect of such procedures on the accountants' independence.

    The Compensation Committee, which consists of Mr. Schlindwein as its sole
member, met once during 2000. The Compensation Committee reviews and recommends
to the Board of Directors the compensation arrangements for all directors and
officers, approves such arrangements for other senior level employees and
administers and takes such other action as may be required in connection with

                                       46
<PAGE>
certain compensation and incentive plans of the Company. The Compensation
Committee also determines the number of options to be granted or shares of
Common Stock to be issued to eligible persons under the Company's stock option
plans and prescribes the terms and provisions of each grant made under the stock
option plans. In addition, the Compensation Committee interprets the stock
option plans and grants thereunder, and establishes, amends and revokes
rules and regulations for administration of such plans.

    All Directors are reimbursed for travel expenses incurred in attending
meetings of the Board of Directors and its committees.

    COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934

    Section 16(a) of the Exchange Act, and related rules of the Securities and
Exchange Commission (the "SEC") require the Company's directors and executive
officers and persons who own more than 10% of a registered class of the
Company's equity securities to file with the SEC initial reports of ownership
and reports of changes in ownership of Common Stock and other equity securities
of the Company. Related rules of the SEC also require such persons to furnish
the Company with copies of all reports filed pursuant to Section 16(a). It
appears that the following individuals did not timely file their reports on
Form 3 during the fiscal year ended December 31, 2000: Ms. Shannon Tvrdik
(March 2000) and Mr. Jay DiNucci (March 2000). It further appears that during
the fiscal year ended December 31, 2000, the following individuals or, where
applicable, entities did not timely file statements of changes in beneficial
ownership on Form 4: MS Acquisition (5 statements), Mr. Timothy Byrd (6
statements), Mr. Nick Bouras (6 statements), Mr. John Rochon (6 statements),
Mr. Gerald Leonard (1 statement), Mr. James Schlindwein (1 statement) and
Mr. Glenn Gillam (1 statement).

ITEM 11.  EXECUTIVE COMPENSATION

    The following sections of this Annual Report on Form 10-K set forth and
discuss the compensation paid or awarded to the Company's Chief Executive
Officer and the four most highly compensated executive officers. Since the
Company paid no compensation prior to the consummation of the Offering on
December 18, 1998, most of the compensation reported for 1998 for those former
Merkert and Rogers employees was paid by Merkert and Rogers prior to the
Combination on December 18, 1998. Certain former RMSI employees did not serve as
executive officers until after the consummation of the Merger on August 18,
1999. Since the Company paid no compensation prior to such date for these
individuals, 1998 compensation is not listed below and most of the compensation
reported for 1999 in these sections was paid by RMSI. 2000 compensation is
listed for all of the employees referenced below.

    SUMMARY COMPENSATION TABLE

    The following table shows the compensation paid to the following executive
officers for the last three years. For former Merkert and Rogers employees, the
1998 results include amounts paid prior to

                                       47
<PAGE>
December 18, 1998. For former RMSI employees, the 1999 results include amounts
paid prior to August 18, 1999:

<TABLE>
<CAPTION>
                                            ANNUAL COMPENSATION                     LONG TERM COMPENSATION
                                            --------------------                ------------------------------
                                                                                   AWARDS
                                                                                 SECURITIES
                                                                                 UNDERLYING        PAYOUTS
                                                                                OPTIONS/SARS      ALL OTHER
NAME AND PRINCIPAL POSITION        YEAR     SALARY($)   BONUS($)     OTHER          (#)        COMPENSATION($)
---------------------------      --------   ---------   --------   ----------   ------------   ---------------
<S>                              <C>        <C>         <C>        <C>          <C>            <C>
Gerald R. Leonard(**) .........    1998     $370,820          --   $11,208(C)       40,000              --
  Chief Executive Officer          1999     $433,910          --   $ 6,958(B)       60,000         $10,267(1)
                                   2000     $446,250    $ 50,000   $12,877(A)      100,000         $ 5,250(1)

Bruce A. Butler(*) ............    1999     $343,076    $145,000        --              --         $69,805(2)
  President of Brand               2000     $350,000    $104,166        --              --         $29,214(1)
  Development

Glenn F. Gillam(**) ...........    1998     $268,333    $100,000   $10,927(C)      100,000              --
  Chief Operations Officer         1999     $304,166    $100,000   $ 3,378(C)           --         $ 5,542(1)
                                   2000     $339,634    $100,000        --         150,000         $ 5,250(1)

Darrell Delong(**) ............    1998     $250,000    $ 50,000        --           3,000              --
  Division President               1999     $294,618          --        --              --              --
                                   2000     $251,766    $ 75,000   $ 1,500(A)        3,000         $ 5,298(1)

Ronald D. Pedersen(***) .......    1999     $441,000          --        --              --         $ 4,800(1)
  Director                         2000     $441,000          --        --              --         $ 5,250(1)
</TABLE>

------------------------

 (*) Former RMSI employee who did not serve as an executive officer until the
     Merger.

 (**) Former Merkert or Rogers employees who commenced employment with the
      Company upon the Combination.

(***) Former Chief Executive Officer and Chairman of the Board of RMSI until the
      Merger. Currently, serves as a Director of the Company.

 (A) Amount represents car allowance paid by the Company on behalf of the
     executive officer.

 (B) Amount represents country club dues paid by the Company on behalf of the
     executive officer.

 (C) Amount represents the total paid by the Company in connection with the
     executive officer's car allowance, excess group life insurance and other
     miscellaneous perquisites.

 (1) Consists of amounts contributed by the Company to the Company's 401(k) Plan
     in which all employees of the Company are eligible to participate.

 (2) Consists of amounts contributed by the Company to the Company's 401(k) Plan
     in which all employees of the Company are eligible to participate and
     $65,005 and $23,964 for moving and relocation expenses in each of 1999 and
     2000, respectively.

                                       48
<PAGE>
    OPTION GRANTS IN LAST FISCAL YEAR

    The following table sets forth the options granted in 2000 to the named
executive officers:

<TABLE>
<CAPTION>
                         NUMBER OF     PERCENT OF                               POTENTIAL REALIZABLE VALUE AT
                           SHARES     TOTAL OPTIONS   EXERCISE                   ASSUMED RATES OF SHARE PRICE
                         UNDERLYING    GRANTED TO      OR BASE                   APPRECIATION FOR OPTION TERM
                          OPTIONS     EMPLOYEES IN      PRICE     EXPIRATION   --------------------------------
NAME                      GRANTED      FISCAL YEAR    ($/SHARE)      DATE         0%         5%         10%
----                     ----------   -------------   ---------   ----------   --------   --------   ----------
<S>                      <C>          <C>             <C>         <C>          <C>        <C>        <C>
Gerald R. Leonard......   100,000          8.21%        $3.00            (1)   $ 75,000   $310,835   $  672,653
Bruce A. Butler........        --            --            --            --          --         --           --
Glenn F. Gillam........   150,000         12.32%        $3.00            (2)   $112,500   $466,253   $1,008,980
Darrell Delong.........     3,000          0.24%        $3.00     Dec. 2008    $  2,250   $  9,325   $   20,179
Ronald D. Pedersen.....        --            --            --            --          --         --           --
</TABLE>

------------------------

(1) 40,000 options expire in 12/08 and 60,000 options expire in 8/09

(2) 25,000 options expire in 12/08, 75,000 options expire in 11/08 and 50,000
    options expire in 1/10

    AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION
     VALUES

    The following table sets forth information concerning the number and value
of unexercised options to purchase shares of the Common Stock held by each of
the named executive officers who held such options at December 31, 2000. None of
the named persons exercised any stock options during 2000.

<TABLE>
<CAPTION>
                                                          NUMBER OF SECURITIES
                                                         UNDERLYING UNEXERCISED         VALUE OF UNEXERCISED
                                                               OPTIONS AT              IN-THE-MONEY OPTIONS AT
                                SHARES                      DECEMBER 31, 2000           DECEMBER 31, 2000(1)
                              ACQUIRED ON    VALUE     ---------------------------   ---------------------------
NAME                           EXERCISE     REALIZED   EXERCISABLE   UNEXERCISABLE   EXERCISABLE   UNEXERCISABLE
----                          -----------   --------   -----------   -------------   -----------   -------------
<S>                           <C>           <C>        <C>           <C>             <C>           <C>
Gerald R. Leonard...........          --         --       33,333         66,667              --             --
Glenn F. Gillam.............          --         --       49,999        100,001              --             --
Darrell DeLong..............          --         --        1,000          2,000              --             --
Bruce A. Butler.............          --         --           --             --              --             --
Ronald D. Pedersen..........          --         --           --             --              --             --
</TABLE>

------------------------

(1) Since the exercise price of the options for these individuals (i.e. $3.00)
    was greater than the closing sale price of the Common Stock, as reported by
    Nasdaq, on December 31, 2000 ($0.25), none of the options were
    "in-the-money".

    See Note 16 of the Company's Notes to Consolidated Financial Statements for
more information related to the Company's options.

    COMPENSATION OF DIRECTORS

    Employee Directors do not receive compensation for their services on the
Board of Directors or committees thereof. Each Director who is not an employee
of the Company (an "Independent Director") receives annual compensation in the
amount of $25,000. Under the Company's stock option plan, each Independent
Director elected following the Offering is entitled to receive an initial option
to purchase approximately 20,000 shares of Common Stock upon his or her election
to the Board of Directors, and each Independent Director who is serving as a
Director on the fifth business day after each annual meeting of stockholders
will receive an option to purchase approximately 5,000 additional shares of
Common Stock.

    The Independent Director who serves as chairman of the Audit Committee may
receive options to purchase an additional 5,000 shares of Common Stock on the
fifth business day after each annual

                                       49
<PAGE>
meeting of stockholders. All options granted to Independent Directors under the
Company's stock option plan vest 50% upon the first anniversary of the grant
date and the remaining 50% vests in equal annual installments over the number of
years remaining in each Director's term as of the first anniversary of the grant
date. Such options terminate upon the tenth anniversary of the grant date and
have an exercise price per share equal to the fair market value of the Common
Stock on the grant date.

    EMPLOYMENT AND NONCOMPETE AGREEMENTS WITH EXECUTIVE OFFICERS

    On April 27, 1999, Mr. Leonard entered into an employment and noncompetition
agreement with the Company providing for a base salary, which is currently
$455,000. The term of employment is for five years, and will continue from month
to month thereafter unless terminated by either party. If the Company terminates
Mr. Leonard's employment without cause, Mr. Leonard is entitled to receive his
then current base salary until expiration of the initial term or the extension
period. Mr. Leonard would also receive a continuation of group health and
automobile benefits during such time period. Pursuant to the agreement,
Mr. Leonard is subject to noncompetition and nonsolicitation provisions for one
year after the termination of his employment.

    In conjunction with a previous employment and noncompetition agreement by
and between the Company and Mr. Leonard (the "First Leonard Employment
Agreement"), Mr. Leonard executed a promissory note in favor of the Company for
$1,500,000 (the "Leonard Note"). Pursuant to the terms of the Leonard Note,
Mr. Leonard purchased 300 shares of Common Stock, which stock was pledged to the
Company as security, pursuant to the terms of a stock pledge agreement between
the Company and Leonard (the "Leonard Pledge Agreement"). On July 7, 1998 and
January 11, 1999, the Company released 60 and 121,817 (after giving effect to
the share recapitalization in connection with the Company's initial public
offering) shares of Common Stock, respectively, from the pledge. On April 27,
1999, under the terms of the current employment agreement (see above for more
detail on this agreement), the Leonard Note became due and payable on April 8,
2004 and certain shares of the Common Stock were released from the pledge such
that shares having a fair market value of $1,500,000 (as of January 11, 1999)
would remain subject to the pledge. After giving effect to the releases and
share recapitalization, 98,361 shares of Common Stock were pledged pursuant to
the Leonard Pledge Agreement (the "Leonard Pledged Shares"). The Company has now
deemed it is in its best interests to no longer issue promissory notes and
require a pledge of the Company's Common Stock as security. Rather, the Company
now achieves the same economic benefits for its employees through the issuance
of employee stock options to purchase shares of Common Stock at a stated
exercise price.

    To make the Leonard Note, Leonard Pledge Agreement, Leonard Pledged Shares
and related provisions of the First Leonard Employment Agreement consistent with
the Company's current practice, Mr. Leonard surrendered any and all rights and
obligations he had under the Leonard Note, Leonard Pledge Agreement, and Leonard
Pledged Shares in exchange for issuance of employee stock options pursuant to
which Leonard will have an option to purchase 98,361 shares of Common Stock at
an aggregate exercise price of $1,500,000, or $15.25 per share all in accordance
with the Exchange Agreement entered into on February 12, 2001, by and between
the Company and Mr. Leonard (the "Exhchange Agreement").

    On April 2, 1996, Mr. Pedersen entered into an employment agreement with
MSSC providing for a base salary, which was in the amount of $441,000. On
January 8, 2001, the Company and Mr. Pedersen entered into an agreement to
modify the employment agreement. According to the modification, Mr. Pedersen
shall be paid an annual salary of $18,000, plus a discretionary bonus at the
Company's option. His initial employment agreement will otherwise remain in
effect. According to his original agreement, if the Company terminates
Mr. Pedersen's employment, Mr. Pedersen is entitled to receive his then current
base salary for a period of two years after termination. Also, Mr. Pedersen is
subject to noncompetition provisions for a period of two years following his
termination. The Company and

                                       50
<PAGE>
Mr. Pedersen also amended his deferred compensation plan in the agreement
reached on January 8, 2001. Pursuant to the agreement, the Company will commence
distribution of Mr. Pedersen's deferred compensation plan that provides the
payment of up to $2,750,000. Distribution of the payments commenced in
January 2001 and will continue over a period of 120 consecutive months.

    On December 18, 1998, Mr. Gillam entered into an employment and
noncompetition agreement with the Company providing for an initial base salary
of $300,000, subject to periodic increases. The term of employment was initially
for a period of three years, and was to continue from month to month thereafter
unless terminated by either party. If the Company terminates employment without
cause, Mr. Gillam is entitled to receive his then current salary until
expiration of the initial term or the extension period. Mr. Gillam would also
receive a continuation of group and health and automobile benefits during such
time period. Pursuant to the agreement, Mr. Gillam is subject to noncompetition
and nonsolicitation provisions for one year after the termination of his
employment. In January 2001, the Company and Mr. Gillam entered into an
amendment to his agreement. Under the terms of the amendment, the term of his
agreement was extended three years from the date of the amendment, his county
clubs dues would be reimbursed by the Company, and he received a $25,000 bonus.

    COMPENSATION COMMITTEE AND INSIDER PARTICIPATION

    In 2000, James A. Schlindwein served as the sole member of the Compensation
Committee of the Company. He is an outside Independent Director and is not a
current or former officer or employee of the Company or any of its affiliates.

                                       51
<PAGE>
                      STOCKHOLDER RETURN PERFORMANCE GRAPH

    The following graph compares, during the period commencing December 15, 1998
(the first day that the Common Stock was traded on Nasdaq) and ending for each
of the periods December 31, 1998, December 31, 1999 and December 29, 2000,
respectively, the cumulative total stockholder return on the Common Stock, based
on the market price of the Common Stock and assuming reinvestment of dividends,
with the total return assuming a $100 investment in the Common Stock, the
Wilshire Small Cap Index and the S&P Small Cap Distributor (Food and Health)
Index. The comparisons in this graph are historical and are not intended to
forecast or be indicative of possible future performance of the Common Stock.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
                         MSC    WILSHIRE SMALL CAP INDEX  S&P SMALL CAP DISTRIBUTOR
<S>                    <C>      <C>                       <C>
Value at 12/15/98 (1)  $100.00                   $100.00                    $100.00
Value at 12/31 /98     $100.00                   $106.92                    $107.63
Value at 12/31/99       $25.00                   $147.88                     $84.28
Value at 12/29/00        $1.65                   $139.24                    $163.61
</TABLE>

<TABLE>
<CAPTION>
                                                        WILSHIRE
                                                        SMALL CAP   S&P SMALL CAP
                                               MSC        INDEX      DISTRIBUTOR
                                             --------   ---------   -------------
<S>                                          <C>        <C>         <C>
Value at 12/15/98(1).......................  $100.00     $100.00       $100.00
Value at 12/31/98..........................  $100.00     $106.92       $107.63
Value at 12/31/99..........................  $ 25.00     $147.88       $ 84.28
Value at 12/29/00..........................  $  1.65     $139.24       $163.61
</TABLE>

------------------------

(1) The beginning measurement point is established by the market close on
    December 15, 1998, the first day on which the Common Stock was traded on
    Nasdaq.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

    The following table sets forth certain information with respect to the
beneficial ownership of the Company's Common Stock as of March 28, 2001, by
(i) each person known by the Company to beneficially own five percent or more of
the outstanding shares of the Common Stock, (ii) each director and named
executive officers of the Company, and (iii) all directors and executive
officers of the Company as a group. As of March 28, 2001, the Company had
25,986,421 shares of Common Stock outstanding, including 25,919,280 shares of
unrestricted Common Stock and 67,141 shares of restricted Common Stock
outstanding. Except as otherwise indicated, the Company believes that the
beneficial owners of the Common Stock listed below, based on information
furnished by such owners, have sole

                                       52
<PAGE>
investment and voting power with respect to such shares, subject to community
property laws where applicable.

<TABLE>
<CAPTION>
                                                            SHARES                       PERCENTAGE
                                                         BENEFICIALLY                    OF SHARES
NAME OF BENEFICIAL OWNER(1)                                OWNED(2)                  BENEFICIALLY OWNED
---------------------------                              ------------                ------------------
<S>                                                      <C>                         <C>
MS Acquisition Ltd.(3) ................................   37,546,533(4)                     81.9%
  17855 N. Dallas Parkway, Suite 200
  Dallas, Texas 75287
James L. Monroe .......................................   17,707,490(5)                     68.1%
  8 Cedar Street, Suite 54A
  Woburn, Massachusetts 01801
John P. Rochon(3)......................................   37,609,032(4)and(17)              82.0%
Timothy M. Byrd(3).....................................   37,571,810(4)and(18)              81.9%
Nick G. Bouras(3)......................................   37,571,810(4)and(19)              81.9%
Gerald R. Leonard......................................      259,334(6)                      1.0%
James A. Schlindwein...................................      388,283(7)                      1.5%
Glenn F. Gillam........................................       53,924(8)                        *
Michael J. Merriman....................................        4,000(9)                        *
Bruce A. Butler........................................   17,707,490(10)                    68.1%
Gary R. Guffey.........................................   17,707,490(11)                    68.1%
Jeffrey A. Watt........................................            0(12)                       *
Ronald D. Pedersen.....................................   17,707,490(13)                    68.1%
Goldman Sachs Asset Management(15) ....................            0(14)                       *
  One New York Plaza
  New York, NY 10004
Jay DiNucci............................................        6,666(15)                       *
Shannon Tvrdik.........................................        3,205(16)                       *
All directors and executive officers as a group           38,374,998                        83.3%
  (11 persons).........................................
</TABLE>

------------------------

*   less than 1%

(1) Unless otherwise indicated, the mailing address for each stockholder and
    director is c/o the Company, 17855 North Dallas Parkway, Suite 200, Dallas,
    Texas 75287.

(2) Beneficial ownership information is determined in accordance with the
    rules of the SEC. In computing the number of shares of Common Stock
    beneficially owned by a person, shares of Common Stock subject to options
    held by that person that are currently exercisable or exercisable within
    60 days of this report are deemed outstanding, but are not deemed to be
    outstanding for the purpose of computing the percentage ownership of any
    other person.

(3) Beneficial ownership information is based on a report on Schedule 13D/A
    filed with the SEC, dated April 2, 2001, and the Transfer Agent's Security
    Owner List Report as of March 28, 2001. Because of their direct or indirect
    ownership interests in, or control of, MS Acquisition, each of MSSC
    Acquisition Corporation, RCPI, J.R. Investments Corp., John P. Rochon,
    Timothy M. Byrd and Nick G. Bouras may be deemed to beneficially own such
    shares.

(4) Beneficial ownership information is based on a report on Schedule 13D/A
    filed with the SEC, dated April 2, 2001 and the Transfer Agent's Security
    Owner List Report as of March 28, 2001. Such shares include 15,835,031
    shares of the Company's Common Stock directly owned by MS Acquisition, which
    may be the subject of the Pre-Merger Voting Agreement, referenced below.
    Such shares also include 19,965 shares of Series B Preferred Stock, which
    are directly owned by MS Acquisition and convertible into 13,674,657 shares
    of Common Stock, and 9,000 shares of Series C Preferred Stock, which are
    directly owned by MS Acquisition and convertible into

                                       53
<PAGE>
    6,164,386 shares of Common Stock. In addition, such shares include 1,872,459
    shares of Common Stock that are the subject of that certain Pre-Merger
    Voting Agreement, dated as of August 18, 1999 by and among MS Acquisition,
    Ronald D. Pedersen, Bruce A. Butler, Gary R. Guffey, Jeffrey A. Watt, JLM
    Management Company, LLC and Monroe & Company, LLC (the "Pre-Merger Voting
    Agreement"). Each of MS Acquisition, MSSC Acquisition Corporation, RCPI,
    J.R. Investments Corp., John P. Rochon, Nick G. Bouras and Timothy M. Byrd
    disclaims beneficial ownership of these shares.

(5) Beneficial ownership information is based on the Transfer Agent's Security
    Owner List Report as of March 28, 2001. Such shares include (i) 10,000
    shares of Common Stock that are held by JLM Management Company, LLC, of
    which Mr. Monroe is a sole manager, and (ii) 17,697,490 shares of Common
    Stock which may be the subject of the Pre-Merger Voting Agreement.
    Mr. Monroe disclaims beneficial ownership of such 17,697,490 shares of
    Common Stock. See footnote (4).

(6) Beneficial ownership information is based on the Transfer Agent's Security
    Owner List Report as of March 28, 2001 and the optionee statements. Such
    shares include (i) 4,275 shares of Common Stock held by Merkert
    Enterprises, Inc. Employee Stock Ownership Trust and allocable to
    Mr. Leonard, (ii) 176,966 shares of Common Stock directly owned by
    Mr. Leonard, (iii) 44,760 shares of restricted Common Stock, directly owned
    by Mr. Leonard, which shares are convertible into shares of Common Stock in
    certain circumstances, and (iv) options to purchase 33,333 shares of the
    Company's Common Stock exercisable within 60 days of March 28, 2001. Such
    shares do not include an aggregate of 55,044 shares held by The Corrie E.
    Leonard Irrevocable Trust and The Kevin M. Leonard Irrevocable Trust, for
    which Mr. Leonard serves as a trustee. Mr. Leonard disclaims beneficial
    ownership of the shares of Common Stock held by such trusts.

(7) Beneficial ownership information is based on the Transfer Agent's Security
    Owner List Report as of March 28, 2001 and the optionee statements. Such
    shares include 291,283 shares held by the Merkert Enterprises, Inc. Employee
    Stock Ownership Trust, of which Mr. Schlindwein is the trustee.
    Mr. Schlindwein disclaims beneficial ownership of these shares. Such shares
    also include (i) options to purchase 12,500 shares of the Company's Common
    Stock exercisable within 60 days of March 28, 2001, (ii) 57,500 shares of
    Common Stock directly owned by Mr. Schlindwein, (iii) 22,000 shares held in
    JSS Management Company, for which Mr. Schlindwein serves as a trustee, and
    (iv) 5,000 shares of Common Stock owned by Suzanne Schlindwein,
    Mr. Schlindwein's spouse, and for which Mr. Schlindwein disclaims beneficial
    ownership.

(8) Beneficial ownership information is based on the Transfer Agent's Security
    Owner List Report as of March 28, 2001 and on the optionee statements. Such
    shares include (i) 3,925 shares held by the Merkert Enterprises, Inc.
    Employee Stock Ownership Trust and allocable to Mr. Gillam, and
    (ii) options to purchase 49,999 shares of the Company's Common Stock
    exercisable within 60 days of March 28, 2001.

(9) Beneficial ownership information is based on the Transfer Agent's Security
    Owner List Report as of March 28, 2001 and the optionee statements. Such
    shares include options to purchase 4,000 shares of the Company's Common
    Stock exercisable within 60 days of March 28, 2001.

(10) Beneficial ownership information is based on the Transfer Agent's Security
    Owner List Report as of March 28, 2001. Such shares include (i) 301,721
    shares of Common Stock that Mr. Butler directly owns, (ii) and 17,405,769
    shares of Common Stock that may be the subject of the Pre-Merger Voting
    Agreement. Mr. Butler disclaims beneficial ownership of such 17,405,769
    shares of Common Stock. See footnote (4).

(11) Beneficial ownership information is based on the Transfer Agent's Security
    Owner List Report as of March 28, 2001. Such shares include (i) 301,721
    shares of Common Stock that Mr. Guffey directly owns, (ii) and 17,405,769
    shares of Common Stock that may be the subject of the

                                       54
<PAGE>
    Pre-Merger Voting Agreement. Mr. Guffey disclaims beneficial ownership of
    such 17,405,769 shares of Common Stock. See footnote (4).

(12) Beneficial ownership information is based on the Transfer Agent's Security
    Owner List Report as of March 28, 2001.

(13) Beneficial ownership information is based on the Transfer Agent's Security
    Owner List Report as of March 28, 2001. Such shares include (i) 959,017
    shares of Common Stock that Mr. Pedersen directly owns, (ii) 300,000 shares
    of Common Stock held by R.D. Pedersen Ltd., and (iii) 16,448,473 shares of
    Common Stock that may be the subject of the Pre-Merger Voting Agreement.
    Mr. Pedersen disclaims beneficial ownership of such 16,448,473 shares of
    Common Stock. See footnote (4).

(14) Beneficial ownership information is based on the Schedule 13G/A filed by
    Goldman Sachs Asset Management, a separate operating division of Goldman,
    Sachs & Co., on February 13, 2001.

(15) Beneficial ownership information is based on the Transfer Agent's Security
    Owner List Report as of March 28, 2001 and the optionee statements. Such
    shares include options to purchase 6,666 shares of the Company's Common
    Stock exercisable by Mr. DiNucci within 60 days of March 28, 2001.

(16) Beneficial ownership information is based on the Transfer Agent's Security
    Owner List Report as of March 28, 2001 and the optionee statements. Such
    shares include options to purchase 3,205 shares of the Company's Common
    Stock exercisable by Ms. Tvrdik within 60 days of March 28, 2001.

(17) According to the optionee statements, such shares also include options to
    purchase 62,499 shares of the Company's Common Stock exercisable by
    Mr. Rochon within 60 days of March 28, 2001.

(18) According to the optionee statements, such shares also include options to
    purchase 25,277 shares of the Company's Common Stock exercisable by
    Mr. Byrd within 60 days of March 28, 2001.

(19) According to the optionee statements, such shares also include options to
    purchase 25,277 shares of the Company's Common Stock exercisable by
    Mr. Bouras within 60 days of March 28, 2001.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

    MONROE SETTLEMENT AGREEMENT

    As reported in the Company's Current Report on Form 8-K dated July 6, 2000
and in the Company's Quarterly Report on Form 10-Q for the period ended
June 30, 2000, the Company entered into a Settlement Agreement and Mutual
Release (the "Settlement Agreement") with Monroe & Company, LLC ("Monroe LLC")
on June 13, 2000. Monroe LLC filed an action entitled MONROE & COMPANY, LLC V.
MARKETING SPECIALISTS CORPORATION, Civil Action No. 99-4745, in Middlesex
Superior Court, Commonwealth of Massachusetts, asserting, among other things,
that it was due advisory fees arising out of letter agreements. The terms of the
Settlement Agreement remain confidential.

    LEONARD STOCK NOTE

    On April 27, 1999, Mr. Leonard entered into an employment and noncompetition
agreement with the Company providing for a base salary, which is currently
$455,000. The term of employment is for five years, and will continue from month
to month thereafter unless terminated by either party. If the Company terminates
Mr. Leonard's employment without cause, Mr. Leonard is entitled to receive his
then current base salary until expiration of the initial term or the extension
period. Mr. Leonard would also receive a continuation of group health and
automobile benefits during such time period. Pursuant to the agreement,
Mr. Leonard is subject to noncompetition and nonsolicitation provisions for one
year after the termination of his employment.

                                       55
<PAGE>
    In conjunction with the First Leonard Employment Agreement, Mr. Leonard
executed the Leonard Note. Pursuant to the terms of the Leonard Note,
Mr. Leonard purchased 300 shares of Common Stock, which stock was pledged to the
Company as security, pursuant to the terms of the Leonard Pledge Agreement. On
July 7, 1998 and January 11, 1999, the Company released 60 and 121,817 (after
giving effect to the share recapitalization in connection with the Company's
initial public offering) shares of Common Stock, respectively, from the pledge.
On April 27, 1999, under the terms of the current employment agreement (see
above for more detail on this agreement), the Leonard Note became due and
payable on April 8, 2004 and certain shares of the Common Stock were released
from the pledge such that shares having a fair market value of $1,500,000 (as of
January 11, 1999) would remain subject to the pledge. After giving effect to the
releases and share recapitalization, the Leonard Pledged Shares were pledged
pursuant to the Leonard Pledge Agreement. The Company has now deemed it is in
its best interests that it should no longer issue promissory notes requiring a
pledge of the Company's Common Stock as security. Rather, the Company now
achieves the same economic benefits for its employees through the issuance of
employee stock options to purchase shares of Common Stock at a stated exercise
price.

    To make the Leonard Note, Leonard Pledge Agreement, Leonard Pledged Shares
and related provisions of the First Leonard Employment Agreement consistent with
the Company's current practice, Mr Leonard surrendered any and all rights and
obligations he had under the Leonard Note, Leonard Pledge Agreement, and Leonard
Pledged Shares in exchange for issuance of employee stock options pursuant to
which Leonard will have an option to purchase 98,361 shares of Common Stock at
an aggregate exercise price of $1,500,000, or $15.25 per share all in accordance
with the Exchange Agreement.

    PROPERTY SALES

    On February 17, 2000, the Company sold certain improved real properties
containing general office and warehouse space situated in Arizona and California
to RCPI Office Properties, LLC, a company affiliated with MS Acquisition, the
principal stockholder of the Company, for approximately $7.3 million before
related costs. In May 2000, RCPI Office Properties LLC sold the Arizona and
California properties to unrelated third parties.

    PARTICIPATION IN AMENDED CREDIT AGREEMENT

    On November 17, 2000, the Company became party to an amendment to the
Amended Credit Agreement. The Amended Credit Agreement provides for an increase
in the maximum amount available under the New Revolver from $50.0 million to a
maximum commitment of $60.0 million, which is comprised of a $41.0 million
Tranche A Note and a subordinated $19.0 million Tranche B Note. MS Acquisition,
the Company's principal stockholder, purchased a 100% participation interest in
the Tranche B Note. The Company must fulfill all payment obligations under the
Amended Revolver before making any interest payments on the Tranche B Note. The
Tranche B Note bears interest at a rate equal to the Base Rate plus 2.25%. The
Tranche B Note and any accrued and unpaid interest will mature on March 30,
2002. The fixed commitment under the Tranche B Note is not subject to the
Borrowing Base.

    OTHER NOTES PAYABLE INVOLVING RELATED PARTIES

    The Company has a mortgage note with RCPI, an affiliate of MS Acquisition,
that is secured by certain land, a building and fixtures. It bears interest at
8.5% with monthly payments of approximately $34,000 (including interest) and a
balloon payment of approximately $3.6 million due in 2001. The balance
outstanding under this mortgage was approximately $3.6 million as of
December 31, 2000.

                                       56
<PAGE>
    On November 9, 2000, the Company issued a $2.5 million promissory note to MS
Acquisition. This promissory note is subordinate to the senior debt of the
Company. The proceeds were used for general corporate purposes. The
$2.5 million promissory note bears interest at a rate equal to the sum of an
interest margin of 2.75% plus the applicable prime rate on the last business day
of the quarter for which interest is payable. Interest is payable quarterly in
arrears, commencing on December 31, 2000, and will continue through the maturity
date. The $2.5 million promissory note and any unpaid and accrued interest will
be payable on November 9, 2002, or on demand, under specified conditions. The
Company is not permitted to repay the principal and unpaid and accrued interest
on the $2.5 million promissory note on demand if the Company's borrowing base
30 days prior to a payment date is not at least $10.0 million, or 25% of the sum
of the Company's payroll for the last four consecutive pay periods, whichever is
greater. In the first quarter of 2001, the $2.5 million promissory note was
converted into redeemable convertible preferred stock. See Note 20 of the Notes
to Consolidated Financial Statements for additional information.

    The Company had other notes payable to former employees of various acquired
entities of approximately $8.5 million as of December 31, 2000. The total
estimated payments have been discounted at rates ranging from 8% to 10%. The
amounts due under the acquisition agreements are unsecured and extend through
2011. These amounts are payable in either monthly or quarterly installments.

    COMMON STOCK TRANSACTIONS

    On January 7, 2000, the Company issued 1,577,287 shares of Common Stock to
MS Acquisition for an aggregate purchase price of $5.0 million ($3.17 per share)
pursuant to the terms of a stock purchase agreement. On March 30, 2000, MS
Acquisition purchased an additional 4,000,000 shares of Common Stock for an
aggregate purchase price of $10.0 million ($2.50 per share) pursuant to the
terms of a stock purchase agreement. The Company used the funds as an additional
source of capital for operations and additional short-term and long-term
liquidity. The offering, sale and issuance of these shares was exempt from
registration under the Securities Act of 1933, as amended, pursuant to a private
offering exemption under Section 4(2) promulgated thereunder.

    As indicated in Note 14, the 9,500 outstanding shares of the Preferred Stock
held by MS Acquisition were converted into 6,234,414 shares of Common Stock.

    REDEEMABLE CONVERTIBLE PREFERRED STOCK TRANSACTIONS

    UNDESIGNATED PREFERRED STOCK

    As of December 31, 2000, there were no shares of undesignated preferred
stock outstanding. Holders of undesignated preferred stock would have priority
over the holders of Common Stock with respect to dividends and to other
distributions, including the distribution of assets upon liquidation. The Board
of Directors has the authority, without stockholder authorization, to issue
shares of undesignated preferred stock in one or more series and to fix the
terms, limitations, relative rights and preferences and variations.

    PREFERRED STOCK

    On June 23, 2000, the Board of Directors of the Company authorized and
provided for the issuance of up to 10,000 shares of the Preferred Stock. Each
share of the Preferred Stock is convertible into that number of shares of Common
Stock equal to the result obtained by dividing the stated value of the Preferred
Stock by the conversion price in effect at the conversion date.

    All dividends on issued shares of the Preferred Stock are cumulative,
whether or not the dividends are earned or declared, on a daily basis from the
issue date and payable quarterly in arrears on each

                                       57
<PAGE>
dividend payment date. Even if not declared, all unpaid dividends will compound
quarterly at an annual dividend rate equal to 8.0%, or the applicable dividend
rate.

    On June 22, 2010, the Company will be obligated to redeem, to the extent of
funds legally available, all outstanding shares of the Preferred Stock at a
redemption price equal to 100% of the liquidation preference per share. The
liquidation preference per share will be equal to the greater of $1,000 per
share or the amount that the equivalent number of shares of Common Stock (based
on the conversion rate applicable at the liquidation date) would be entitled to
receive, plus any unpaid dividends.

    On June 23, 2000, the Company issued 5,000 shares of Preferred Stock to MS
Acquisition for an aggregate purchase price of $5.0 million pursuant to the
terms of a preferred stock purchase agreement. On August 8, 2000, the Company
issued 4,500 additional shares of Preferred Stock to MS Acquisition for an
aggregate purchase price of $4.5 million pursuant to the terms of a preferred
stock purchase agreement.

    On July 27, 2000, the Company received early termination of the waiting
period in connection with its Hart-Scott-Rodino Antitrust Improvement Act filing
thereafter allowing the conversion of the Preferred Stock to Common Stock of the
Company. On August 21, 2000, the 9,500 shares of Preferred Stock, previously
issued to MS Acquisition, were converted into 6,234,414 shares of Common Stock.
Per the terms of the preferred stock purchase agreements, each share of
Preferred Stock was converted into approximately 656.25 shares of Common Stock
(i.e., the Preferred Stock's stated value of $1,000 divided by the conversion
price of $1.5238).

    On August 17, 2000, the Company issued a $4.75 million promissory note to MS
Acquisition. On August 30, 2000, the Company issued a $5.0 million promissory
note to MS Acquisition. The Registered Notes and the New Senior Credit Facility
are senior to these notes. The Company used the proceeds from both promissory
notes for general corporate purposes.

    SERIES B PREFERRED STOCK

    On November 1, 2000, the Company's Board of Directors authorized the
issuance of up to 20,000 shares of the Series B Preferred Stock. The Series B
Preferred Stock has a stated value of $1,000 per share. The Series B Preferred
Stock is of equal class with the Preferred Stock previously authorized and any
future designated series of preferred stock unless specifically noted in future
preferred stock agreements. The Series B Preferred Stock has the same
characteristics (i.e., dividend terms, conversion features) as the Preferred
Stock.

    On November 1, 2000, the Company issued 12,397 shares of the Series B
Preferred Stock to MS Acquisition for an aggregate purchase price of
approximately $12.4 million pursuant to the terms of a preferred stock purchase
agreement. The purchase price consisted of the cancellation of the
$4.75 million promissory note and the $5.0 million promissory note, including
all accrued and unpaid interest, plus an additional cash payment of
approximately $2.5 million to the Company. The incremental proceeds from the
issuance of the Series B Preferred Stock were used for general corporate
purposes.

    On November 9, 2000, the Company issued a $2.5 million promissory note to MS
Acquisition. This promissory note is subordinate to the senior debt of the
Company. The proceeds were used for general corporate purposes. The
$2.5 million promissory note bears interest at a rate equal to the sum of an
interest margin of 2.75% plus the applicable prime rate on the last business day
of the quarter for which interest is payable. Interest is payable quarterly in
arrears, commencing on December 31, 2000, and will continue through the maturity
date. The $2.5 million promissory note and any unpaid and accrued interest will
be payable on November 9, 2002, or on demand, under specified conditions. The
Company is not permitted to repay the principal and unpaid and accrued interest
on the $2.5 million promissory note on demand if the Company's borrowing base
30 days prior to a payment date is not at

                                       58
<PAGE>
least $10.0 million, or 25% of the sum of the Company's payroll for the last
four consecutive pay periods, whichever is greater. In the first quarter of
2001, the $2.5 million promissory note was converted into redeemable convertible
preferred stock. See Note 20 of the Notes to Consolidated Financial Statements
for additional information.

    On January 26, 2001, the Company issued 7,568 shares of the Series B
Preferred Stock to MS Acquisition for an aggregate purchase price of
approximately $7.6 million pursuant to the terms of a preferred stock purchase
agreement. The purchase price consisted of the cancellation of the $2.5 million
promissory note, including all accrued and unpaid interest, plus an additional
cash payment of approximately $5.0 million to the Company. A total of
$4.0 million of the cash proceeds were received in December 2000 and appeared as
a component of Other Liabilities in the consolidated balance sheet as of
December 31, 2000. The incremental proceeds from the issuance of the Series B
Preferred Stock were used for general corporate purposes.

    SERIES C PREFERRED STOCK

    On March 26, 2001, the Company's Board of Directors authorized the issuance
of up to 20,000 shares of the Series C Preferred Stock. The Series C Preferred
Stock has a stated value of $1,000 per share. The Series C Preferred Stock is of
equal class with the Preferred Stock and the Series B Preferred Stock previously
authorized and any future designated series of preferred stock unless
specifically noted in future preferred stock agreements.

    Each share of the Series C Preferred Stock is convertible into that number
of shares of Common Stock equal to the result obtained by dividing the stated
value of the Series C Preferred Stock by the conversion price in effect at the
conversion date.

    All dividends on issued shares of the Series C Preferred Stock are
cumulative, whether or not the dividends are earned or declared, on a daily
basis from the issue date and payable quarterly in arrears on each dividend
payment date. Even if not declared, all unpaid dividends will compound quarterly
at an annual dividend rate equal to 8.0%, or the applicable dividend rate.

    On June 22, 2010, the Company will be obligated to redeem, to the extent of
funds legally available, all outstanding shares of the Series C Preferred Stock
at a redemption price equal to 100% of the liquidation preference per share. The
liquidation preference per share will be equal to the greater of $1,000 per
share or the amount that the equivalent number of shares of Common Stock (based
on the conversion rate applicable at the liquidation date) would be entitled to
receive, plus any unpaid dividends.

    On March 28, 2001, the Company issued 9,000 shares of the Series C Preferred
Stock to MS Acquisition for an aggregate purchase price of $9.0 million in cash
pursuant to the terms of a preferred stock purchase agreement. The proceeds from
the issuance of the Series C Preferred Stock were used for general corporate
purposes.

    On March 30, 2001, the Company issued 2,000 shares of the Series C Preferred
Stock to MS Acquisition for an aggregate purchase price of $2.0 million in cash
pursuant to the terms of a preferred stock purchase agreement. The proceeds from
the issuance of the Series C Preferred Stock were used for general corporate
purposes.

    COMPANY POLICY

    The Company's policy is that any future transactions with directors,
officers, employees or affiliates of the Company be approved in advance by a
majority of the Company's Board of Directors, including a majority of the
disinterested members of the Board of Directors, and be on terms no less
favorable to the Company than the Company could obtain from unaffiliated
parties.

                                       59
<PAGE>
                                    PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULE AND REPORTS ON FORM 8-K

(a) Documents filed as a part of this Annual Report on Form 10-K.

    1.  Financial Statements.

       The Financial Statements filed as a part of this Annual Report on Form
       10-K are listed on the Index to Consolidated Financial Statements and
       Consolidated Financial Statement Schedule on page F-1.

    2.  Exhibits.

       The Exhibits filed as a part of this Form 10-K are listed on the Index to
       Exhibits immediately following the Company's Financial Statements.

(b) Reports on Form 8-K.

    1.  Current report on Form 8-K dated November 22, 2000, reporting third
       quarter financials and the completion of negotiations to amend certain
       provisions of the Company's senior credit facility.

    2.  Current report on Form 8-K dated December 1, 2000, reporting a change in
       the Company's certifying accountant from Arthur Andersen, L.L.P. to
       PricewaterhouseCoopers L.L.P.

    3.  Current report on Form 8-K dated February 7, 2001, reporting the
       expansion of the Company's services to include a new Retail Drug
       Division.

    4.  Current report on Form 8-K dated March 2, 2001 reporting that the
       Company is adding a new In-Source Specialists Division, which will serve
       as an arm of its existing Retail Division.

    5.  Current report on Form 8-K dated March 13, 2001, reporting that
       effective the opening of business on March 14, 2001, the Company's stock
       will no longer be listed on the Nasdaq SmallCap Market, but will be
       eligible for trading on the OTC Bulletin Board instead.

                                       60
<PAGE>
                               INDEX TO EXHIBITS

    The following is a list of exhibits filed or incorporated by reference as a
part of this Annual Report on Form 10-K:

<TABLE>
<CAPTION>
EXHIBIT NO.                                     DESCRIPTION
-----------             ------------------------------------------------------------
<C>                     <S>
        2.1             Amendment No. 1, dated July 8, 1999, to the Agreement and
                        Plan of Merger, dated as of April 28, 1999, between Merkert
                        American Corporation and Richmont Marketing Specialists
                        Inc., attached as Annex A to Merkert American Corporation's
                        Proxy Statement dated July 12, 1999 and incorporated herein
                        by reference.

        2.2             Agreement and Plan of Merger, dated as of April 28, 1999,
                        between Merkert American Corporation and Richmont Marketing
                        Specialists Inc., incorporated by reference to Exhibit 2.1
                        to Merkert American Corporation's Current Report on Form 8-K
                        dated April 30, 1999.

        3.1             Second Amended and Restated Certificate of Incorporation of
                        Merkert American Corporation, incorporated by reference to
                        Exhibit 3.1 to Merkert American Corporation's Amendment
                        No. 7 to Registration Statement on Form S-1 filed December
                        15, 1998 (No. 333-53419).

        3.2             Certificate of Amendment to the Second Amended and Restated
                        Certificate of Incorporation of Merkert American
                        Corporation, dated August 18, 1999, incorporated by
                        reference to Exhibit 4.2 of the Company's Current Report on
                        Form 8-K dated September 2, 1999.

        3.3             Amended and Restated By-laws of Merkert American
                        Corporation, incorporated by reference to Exhibit 3.2 of the
                        Company's Annual Report on Form 10-K dated March 31, 1999.

        4.1             Indenture, dated as of December 19, 1997, among Richmont
                        Marketing Specialists Inc. and Texas Commerce Bank National
                        Association, as Trustee, incorporated by reference to
                        Exhibit 4.1 of Richmont Marketing Specialists Inc.
                        Registration Statement on Form S-4 dated June 16, 1999.

        4.2             First Supplemental Indenture, dated as of August 18, 1999,
                        among the Company, Merkert American Co., Inc., United
                        Brokerage Company, Buckeye Sales & Marketing, Inc.,
                        Marketing Specialists Sales Company, Bromar, Inc., Brokerage
                        Services, Inc., Atlas Marketing Company, Inc., Meatmaster
                        Brokerage, Inc., and Chase Bank of Texas, National
                        Association, incorporated by reference to Exhibit 4.3 to the
                        Quarterly Report on Form 10-Q dated September 30, 1999.

        4.3             Second Supplemental Indenture, dated as of October 13, 1999,
                        among the Company, its subsidiaries and Chase Bank of Texas,
                        National Association, incorporated by reference to Exhibit
                        4.3 to the Company's Annual Report on Form 10-K filed April
                        15, 2000.

        4.4             Third Supplemental Indenture, dated as of March 30, 2000,
                        among the Company, certain Guarantor Subsidiaries and Chase
                        Bank of Texas, National Association, incorporated by
                        reference to Exhibit 4.4 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

        4.5             Certificate of Merger, dated August 18, 1999, incorporated
                        by reference to Exhibit 4.1 to the Company's Current Report
                        on Form 8-K dated September 2, 1999.
</TABLE>

                                       61
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT NO.                                     DESCRIPTION
-----------             ------------------------------------------------------------
<C>                     <S>
        4.6             Specimen Certificate for shares of Common Stock of the
                        Company, incorporated by reference to Exhibit 4.1 to the
                        Company's Amendment No. 6 to Registration Statement on Form
                        S-1 dated November 19, 1998 (No. 333-53419).

       10.1             Warrant Agreement, dated as of March 30, 2000, among the
                        Company and First Union Investors, Inc., incorporated by
                        reference to Exhibit 10.3 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

       10.2             Registration Rights Agreement, dated as of March 30, 2000,
                        by and between the Company and First Union Investors, Inc.,
                        incorporated by reference to Exhibit 10.4 to the Company's
                        Annual Report on Form 10-K filed April 15, 2000.

       10.3             Stockholders Agreement, dated as of March 30, 2000, by and
                        among the Company, First Union Investors, Inc., MS
                        Acquisition Limited and Richmont Capital Partners I, L.P.,
                        incorporated by reference to Exhibit 10.5 to the Company's
                        Annual Report on Form 10-K filed April 15, 2000.

       10.4             Credit Agreement, dated March 30, 2000, among the Company
                        and certain of its subsidiaries, as Borrowers, Chase
                        Manhattan Bank, as agent, and the banks named therein,
                        incorporated by reference to Exhibit 10.6 to the Company's
                        Annual Report on Form 10-K filed April 15, 2000.

       10.5             Second Amended and Restated Credit Agreement, dated March
                        30, 2000, among First Union National Bank, for itself and as
                        agent, the other Lenders described therein and the Company
                        and the Guarantors described therein, incorporated by
                        reference to Exhibit 10.7 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

       10.6             Second Amended and Restated Security Agreement, dated March
                        30, 2000, by and among the Company and its subsidiaries, in
                        favor of First Union National Bank, as agent, incorporated
                        by reference to Exhibit 10.8 to the Company's Annual Report
                        on Form 10-K filed April 15, 2000.

       10.7             Second Amended and Restated Pledge Agreement, dated March
                        30, 2000, by and among the Company and its subsidiaries, in
                        favor of First Union National Bank, as agent, incorporated
                        by reference to Exhibit 10.9 to the Company's Annual Report
                        on Form 10-K filed April 15, 2000.

       10.8             Second Amended and Restated Guaranty Agreement, dated March
                        30, 2000, by and among Marketing Specialists Sales Company,
                        Bromar, Inc., and Paul Inman Associates, Inc., in favor of
                        First Union National Bank, incorporated by reference to
                        Exhibit 10.10 to the Company's Annual Report on Form 10-K
                        filed April 15, 2000.

       10.9             First Amendment to Credit Agreement, dated April 13, 2000,
                        among the Company, Marketing Specialists Sales Company, Paul
                        Inman Associates, Inc., Bromar, Inc. and The Chase Manhattan
                        Bank, incorporated by reference to Exhibit 10.2 to the
                        Company's Quarterly Report on Form 10-Q filed August 14,
                        2000.

       10.10            Joinder Agreement, dated April 14, 2000, by The Sales Force
                        Companies, Inc., the Company, Marketing Specialists Sales
                        Company, Paul Inman Associates, Inc., Bromar, Inc. and The
                        Chase Manhattan Bank, incorporated by reference to Exhibit
                        10.3 to the Company's Quarterly Report on Form 10-Q filed
                        August 14, 2000.
</TABLE>

                                       62
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT NO.                                     DESCRIPTION
-----------             ------------------------------------------------------------
<C>                     <S>
       10.11            Intercreditor Agreement, dated March 30, 2000, between and
                        among the Company, Paul Inman Associates, Inc., Marketing
                        Specialists Sales Company, and Bromar, Inc., as Debtors, and
                        The Chase Manhattan Bank and First Union National Bank, as
                        Agents, incorporated by reference to Exhibit 10.4 to the
                        Company's Quarterly Report on Form 10-Q filed August 14,
                        2000.

       10.12            Guaranty Agreement, dated March 30, 2000, of Richmont
                        Capital Partners I, L.P., incorporated by reference to
                        Exhibit 10.5 to the Company's Quarterly Report on Form 10-Q
                        filed August 14, 2000.

       10.13            Security Agreement, dated March 30, 2000, by and among the
                        Company, Marketing Specialists Sales Company, Paul Inman
                        Associates, Inc., and Bromar, Inc., and The Chase Manhattan
                        Bank, incorporated by reference to Exhibit 10.6 to the
                        Company's Quarterly Report on Form 10-Q filed August 14,
                        2000.

       10.14            Promissory Note, dated March 30, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales Company,
                        and Bromar, Inc. issued to The Chase Manhattan Bank,
                        incorporated by reference to Exhibit 10.7 to the Company's
                        Quarterly Report on Form 10-Q filed August 14, 2000.

       10.15            Promissory Note, dated April 14, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales Company,
                        Bromar, Inc., and The Sales Force Companies, Inc. issued to
                        The Chase Manhattan Bank, incorporated by reference to
                        Exhibit 10.8 to the Company's Quarterly Report on Form 10-Q
                        filed August 14, 2000.

       10.16            Promissory Note, dated March 30, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales Company,
                        and Bromar, Inc. issued to Credit Suisse/First Boston,
                        incorporated by reference to Exhibit 10.9 to the Company's
                        Quarterly Report on Form 10-Q filed August 14, 2000.

       10.17            Promissory Note, dated April 14, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales Company,
                        Bromar, Inc., and The Sales Force Companies, Inc. issued to
                        Credit Suisse/First Boston, incorporated by reference to
                        Exhibit 10.10 to the Company's Quarterly Report on Form 10-Q
                        filed August 14, 2000.

       10.18            Promissory Note, dated March 30, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales Company,
                        and Bromar, Inc. issued to Fleet Capital Bank, incorporated
                        by reference to Exhibit 10.11 to the Company's Quarterly
                        Report on Form 10-Q filed August 14, 2000.

       10.19            Promissory Note, dated April 14, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales Company,
                        Bromar, Inc., and The Sales Force Companies, Inc. issued to
                        Fleet Capital Bank, incorporated by reference to Exhibit
                        10.12 to the Company's Quarterly Report on Form 10-Q filed
                        August 14, 2000.

       10.20            Second Amended and Restated Term Note, as amended and
                        restated March 30, 2000, of the Company issued to First
                        Union National Bank, incorporated by reference to
                        Exhibit 10.14 to the Company's Quarterly Report on Form 10-Q
                        filed August 14, 2000.

       10.21            Promissory Note, dated August 17, 2000, of the Company
                        issued to Richmont Capital Partners I, L.P. in the principal
                        amount of $4,750,000, incorporated by reference to
                        Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q
                        filed November 21, 2000.
</TABLE>

                                       63
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT NO.                                     DESCRIPTION
-----------             ------------------------------------------------------------
<C>                     <S>
       10.22            Promissory Note, dated August 30, 2000, of the Company
                        issued to Richmont Capital Partners I, L.P. in the principal
                        amount of $4,999,999, incorporated by reference to
                        Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q
                        filed November 21, 2000.

       10.23            Deposit Security Agreement, dated as of October 5, 2000, by
                        and between MS Acquisition Limited, a Delaware limited
                        partnership, and The Chase Manhattan Bank, as agent for the
                        Banks (as defined therein) in connection with the pledge by
                        MS Acquisition Limited of cash and cash equivalents to
                        increase the Company's borrowing availability, incorporated
                        by reference to Exhibit 10.3 to the Company's Quarterly
                        Report on Form 10-Q filed November 21, 2000.

       10.24            Promissory Note, dated November 8, 2000, of the Company
                        issued to Richmont Capital Partners I, L.P. in the principal
                        amount of $2,500,000, incorporated by reference to
                        Exhibit 10.5 to the Company's Quarterly Report on Form 10-Q
                        filed November 21, 2000.

       10.25            First Amendment to Credit Agreement, dated November 17,
                        2000, by and among the Company, certain lenders described
                        therein, and First Union National Bank, as Agent and as sole
                        Lender, incorporated by reference to Exhibit 10.6 to the
                        Company's Quarterly Report on Form 10-Q filed November 21,
                        2000.

       10.26            Amended and Restated Intercreditor Agreement, dated November
                        17, 2000, between and among the Company, certain of its
                        subsidiaries, The Chase Manhattan Bank, as agent for the
                        Revolver Lenders (as defined therein), First Union National
                        Bank, as agent for the Term Lenders (as defined therein), MS
                        Acquisition Limited, and Richmont Capital Partners I, L.P.,
                        incorporated by reference to Exhibit 10.7 to the Company's
                        Quarterly Report on Form 10-Q filed November 21, 2000.

       10.27            Second Amendment to Credit Agreement dated November 17,
                        2000, among the Company, Marketing Specialists Sales
                        Company, Paul Inman Associates, Inc., and The Sales Force
                        Companies, Inc., certain banks or other lending institutions
                        named therein, and The Chase Manhattan Bank, individually as
                        a bank and as agent for itself and the other banks or
                        lending institutions named therein, incorporated by
                        reference to Exhibit 10.8 to the Company's Quarterly Report
                        on Form 10-Q filed November 21, 2000.

       10.28            Master Participation Agreement, dated November 17, 2000, by
                        and among MS Acquisition Limited and various banks or other
                        lending institutions named therein, incorporated by
                        reference to Exhibit 10.9 to the Company's Quarterly Report
                        on Form 10-Q filed November 21, 2000.

       10.29            Common Stock Purchase Agreement, dated as of January 7,
                        2000, by and between the Company and MS Acquisition Limited,
                        incorporated by reference to Exhibit 10.1 to the Company's
                        Annual Report on Form 10-K filed April 15, 2000.

       10.30            Common Stock Purchase Agreement, dated as of March 30, 2000,
                        by and between the Company and MS Acquisition Limited,
                        incorporated by reference to Exhibit 10.2 to the Company's
                        Annual Report on Form 10-K filed April 15, 2000.

       10.31            Stock Purchase Agreement, dated March 2, 2000, by and among
                        Marketing Specialists Sales Company, as Buyer, The Sales
                        Force Companies, Inc., as the Seller, and the Stockholders
                        of the Company, incorporated by reference to Exhibit 10.11
                        to the Company's Annual Report on Form 10-K filed April 15,
                        2000.
</TABLE>

                                       64
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT NO.                                     DESCRIPTION
-----------             ------------------------------------------------------------
<C>                     <S>
       10.32            Asset Purchase Agreement, dated as of November 18, 1999, by
                        and among Marketing Specialists Sales Company and
                        Johnson-Lieber, Inc., as amended by that certain First
                        Amendment to Asset Purchase Agreement dated as of January
                        27, 2000, incorporated by reference to Exhibit 10.16 to the
                        Company's Annual Report on Form 10-K filed April 15, 2000.

       10.33            Stock Purchase Agreement, dated July 7, 1999, by and among
                        Merkert American Corporation, as Buyer, Buckeye Sales &
                        Marketing, Inc., d/b/a The Sell Group-Cleveland, as the
                        Company, JF & JF Limited Partnership, as the Stockholder of
                        the Company, and the Primary Parties, incorporated by
                        reference to Exhibit 10.17 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

       10.34            Stock Purchase Agreement, dated as of May 14, 1999, by and
                        among Richmont Marketing Specialists Inc., Paul Inman
                        Associates, Inc. and the Shareholders of Paul Inman
                        Associates, Inc., as amended by that certain First Amendment
                        to Stock Purchase Agreement dated as of August 13, 1999 and
                        that certain Second Amendment to Stock Purchase Agreement
                        dated as of August 18, 1999, incorporated by reference to
                        Exhibit 10.18 to the Company's Annual Report on Form 10-K
                        filed April 15, 2000.

       10.35            Stock Purchase Agreement, dated April 26, 1999, by and among
                        Merkert American Corporation, as Buyer, United Brokerage
                        Company d/b/a The Sell Group-Grand Rapids, Toledo, Detroit,
                        Indianapolis and Fort Wayne, as the Company, and the
                        Stockholders of the Company, incorporated by reference to
                        Exhibit 10.19 to the Company's Annual Report on Form 10-K
                        filed April 15, 2000.

       10.36            Stock Purchase Agreement, dated January 20, 1999, among
                        Merkert American Corporation, Sell, Inc. and the
                        stockholders of Sell, Inc., incorporated by reference to
                        Exhibit 10.36 to the Company's Annual Report on Form 10-K
                        dated March 31, 1999.

       10.37            Stock Purchase Agreement, closing date April 14, 2000, by
                        and among Marketing Specialists Sales Company, as Buyer, The
                        Sales Force Companies, Inc., as the Seller, and the
                        Stockholders of the Company, incorporated by reference to
                        Exhibit 10.18 to the Company's Quarterly Report on Form 10-Q
                        filed August 14, 2000.

       10.38            Management Agreement, dated as of June 30, 2000, by and
                        among Marketing Specialists Sales Company, Mancini &
                        Groesbeck, Inc., Mancini & Groesbeck, Inc. Montana, Tad
                        Mancini and Chris Mancini, incorporated by reference to
                        Exhibit 10.19 to the Company's Quarterly Report on Form 10-Q
                        filed August 14, 2000.

       10.39            Preferred Stock Purchase Agreement, dated June 23, 2000, by
                        and between the Company and MS Acquisition Limited in
                        connection with the sale by the Company of 5,000 shares of
                        convertible paid-in-kind preferred stock, incorporated by
                        reference to Exhibit 10.20 to the Company's Quarterly Report
                        on Form 10-Q filed August 14, 2000.

       10.40            Preferred Stock Purchase Agreement, dated August 8, 2000, by
                        and between the Company and MS Acquisition Limited in
                        connection with the sale by the Company of 4,500 shares of
                        convertible paid-in-kind preferred stock, incorporated by
                        reference to Exhibit 10.21 to the Company's Quarterly Report
                        on Form 10-Q filed August 14, 2000.

       10.41            Preferred Stock Purchase Agreement, dated November 1, 2000,
                        by and between the Company and MS Acquisition Limited in
                        connection with the issuance by the Company of 12,397 shares
                        of Series B Convertible Paid-In-Kind Preferred Stock,
                        incorporated by reference to Exhibit 10.4 to the Company's
                        Quarterly Report on Form 10-Q filed November 21, 2000.
</TABLE>

                                       65
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT NO.                                     DESCRIPTION
-----------             ------------------------------------------------------------
<C>                     <S>
       10.42            Registration Rights Agreement, dated as of August 18, 1999,
                        by and among Merkert American Corporation, Gerald R.
                        Leonard, Monroe & Company, LLC, JLM Management, LLC, Robert
                        Doehler, Joseph T. Casey, Edward P. Grace, III, James
                        Philopkosky, Sandra Monroe, Sean P. Spaulding and Jo-Anne
                        Collins incorporated by reference to Exhibit 10.8 to the
                        Quarterly Report on Form 10-Q dated November 15, 1999.

       10.43            Post-Merger Voting Agreement, dated as of August 18, 1999,
                        by and among MS Acquisition Limited, Ronald D. Pedersen,
                        Bruce A. Butler, Gary R. Guffey, Jeffery A. Watt, Monroe &
                        Company, LLC and JLM Management Company, LLC incorporated by
                        reference to Exhibit 10.9 to the Quarterly Report on Form
                        10-Q dated November 15, 1999.

       10.44            Advisory Agreement, dated as of August 18, 1999, by and
                        among the Company, Monroe & Company, LLC and Richmont
                        Capital Partners I, L.P. incorporated by reference to
                        Exhibit 10.10 to the Quarterly Report on Form 10-Q dated
                        November 15, 1999.

       10.45*           Asset Purchase and Sale Agreement for the acquisition of
                        substantially all of the assets of the Dorann Foods, Merco
                        Packaging, Merco Price Marking, and Merkert Laboratories
                        Divisions of the Company and Marketing Specialists Sales
                        Company by Woodland Partners, LLC, dated as of January 19,
                        2001. (filed herewith)

       10.46*           Memorandum of Agreement by and among the Company, William F.
                        Lee on behalf of the former stockholders of The Sales Force
                        Companies, Inc. ("Sales Force") other than the Employee
                        Stock Ownership Trust established by Sales Force ("ESOT")
                        and the ESOT dated December 28, 2000. (filed herewith)

       10.47*           Preferred Stock Purchase Agreement, dated January 26, 2001,
                        by and between the Company and MS Acquisition Limited in
                        connection with the sale by the Company of 7,568 shares of
                        convertible paid-in-kind preferred stock. (filed herewith)

       10.48*           Preferred Stock Purchase Agreement, dated March 28, 2001, by
                        and between the Company and MS Acquisition Limited in
                        connection with the sale by the Company of 9,000 shares of
                        convertible paid-in-kind preferred stock. (filed herewith)

       10.49*           Exchange Agreement, dated as of February 12, 2001, by and
                        between the Company and Gerald R. Leonard. (filed herewith)

       10.50            Contract of Sale of Improved Property, dated February 17,
                        2000, by and between Bromar, Inc. and RCPI Office
                        Properties, LLC ("Arizona Property"), incorporated by
                        reference to Exhibit 10.12 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

       10.51            Lease, dated February 17, 2000, between RCPI Office
                        Properties, LLC and Marketing Specialists Sales Company
                        ("Arizona Property"), incorporated by reference to Exhibit
                        10.13 to the Company's Annual Report on Form 10-K filed
                        April 15, 2000.

       10.52            Contract of Sale of Improved Property, dated February 17,
                        2000, by and between Bromar, Inc. and RCPI Office
                        Properties, LLC ("California Property"), incorporated by
                        reference to Exhibit 10.14 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

       10.53*           Agreement for Purchase and Sale of Real Property, dated
                        December 15, 2000, by and between Steve Farnic and Marketing
                        Specialists Sales Company, for the sale of 4.851 acres in
                        Mecklenberg, County, North Carolina. (filed herewith)

       10.54*           Lease, dated May 15, 2000, between LaSalle Company, LLC and
                        Marketing Specialists Sales Company for the Arizona
                        Property. (filed herewith)
</TABLE>

                                       66
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT NO.                                     DESCRIPTION
-----------             ------------------------------------------------------------
<C>                     <S>
       10.55*           Lease, dated May 2, 2000, between IPT Partners, LLC and
                        Marketing Specialists Sales Company for the California
                        Property. (filed herewith)

       10.56            Employment Agreement, dated April 2, 1996, between Marketing
                        Specialists Sales Company and Ronald D. Pedersen,
                        incorporated by reference to Exhibit 10.8 of Richmont
                        Marketing Specialists Inc. Registration Statement on Form
                        S-4 dated June 16, 1999.

       10.57            Employment Agreement, dated April 2, 1996, between Marketing
                        Specialists Sales Company and Bruce A. Butler, incorporated
                        by reference to Exhibit 10.9 of Richmont Marketing
                        Specialists Inc. Registration Statement on Form S-4 dated
                        June 16, 1999.

       10.58*           Amendment to Employment Agreement, dated January 8, 2001,
                        between the Company and Ronald D. Pedersen. (filed herewith)

       10.59*           First Amendment to Employment and Noncompetition Agreement,
                        dated February 9, 2001, between the Company and Glenn F.
                        Gillam. (filed herewith)

       10.60            First Amendment to Amended and Restated Merkert American
                        Corporation 1998 Stock Option and Incentive Plan,
                        incorporated by reference to Exhibit 10.5 to the Company's
                        Current Report on Form 8-K dated September 2, 1999.

       10.61            Amendment to the Company's 1998 Stock Option Plan, filed as
                        Appendix A to the Company's Definitive Proxy Statement filed
                        June 16, 2000.

       10.62*           Waiver and Third Amendment to Credit Agreement, dated as of
                        March 30, 2001, among the Company, certain of its
                        subsidiaries, the Agent (named therein) and the lenders
                        parties thereto. (filed herewith)

       10.63*           Second Amendment to Credit Agreement, made as of April 19,
                        2001, by and among the Company and First Union National
                        Bank, as Agent and sole Lender. (filed herewith)

       21.1*            Subsidiaries of the Company.

      23*               Consent of PricewaterhouseCoopers LLP.

      24*               Power of Attorney (included on signature page of this Form
                        10-K).

      25*               Consent of Arthur Andersen LLP.
</TABLE>

------------------------

*   Indicates that document is filed herewith.

                                       67
<PAGE>
                                   SIGNATURES

    Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

<TABLE>
<S>                                                    <C>  <C>
                                                       MARKETING SPECIALISTS CORPORATION

                                                       By:             /s/ TIMOTHY M. BYRD
                                                            -----------------------------------------
                                                                         Timothy M. Byrd,
                                                                CHIEF FINANCIAL OFFICER, DIRECTOR

DATED: APRIL 23, 2001
</TABLE>

    Pursuant to the requirements of the Exchange Act, this report has been
signed by the following persons on behalf of the Registrant and in the
capacities indicated on APRIL 23, 2001.

    Each person whose signature appears below hereby constitutes and appoints
Timothy M. Byrd his true and lawful attorney-in-fact, for him and in his name,
place and stead, to sign any and all amendments to this report and to cause the
same to be filed with the SEC, hereby granting to said attorney-in-fact full
power and authority to do and perform all and every act and thing whatsoever
requisite or desirable to be done in and about the premises as fully to all
intents and purposes as the undersigned might or could do in person hereby
ratifying and confirming all acts and things that said attorney-in-fact may do
or cause to be done by virtue of these presents.

<TABLE>
<CAPTION>
                      SIGNATURE                                            TITLE
                      ---------                                            -----
<C>                                                    <S>
               /s/ RONALD D. PEDERSEN                  Chairman of the Board, Director
     -------------------------------------------
                 Ronald D. Pedersen

                /s/ GERALD R. LEONARD                  Chief Executive Officer, President, Director
     -------------------------------------------         (Principal Executive Officer)
                  Gerald R. Leonard

                 /s/ TIMOTHY M. BYRD                   Chief Financial Officer, Director
     -------------------------------------------         (Principal Financial Officer)
                   Timothy M. Byrd

                   /s/ JAY DINUCCI                     Vice President, Corporate Controller
     -------------------------------------------         (Principal Accounting Officer)
                     Jay DiNucci

                 /s/ NICK G. BOURAS                    Director
     -------------------------------------------
                   Nick G. Bouras

               /s/ MICHAEL J. MERRIMAN                 Director
     -------------------------------------------
                 Michael J. Merriman

                 /s/ JOHN P. ROCHON                    Director
     -------------------------------------------
                   John P. Rochon

              /s/ JAMES A. SCHLINDWEIN                 Director
     -------------------------------------------
                James A. Schlindwein
</TABLE>

                                       68
<PAGE>
ITEM 14A.  INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                                PAGE
                                                              --------
<S>                                                           <C>
CONSOLIDATED FINANCIAL STATEMENTS:
MARKETING SPECIALISTS CORPORATION AND SUBSIDIARIES:
  Report of Independent Accountants.........................     F-2
  Report of Independent Accountants.........................    F-2A
  Consolidated Balance Sheets...............................     F-3
  Consolidated Statements of Operations.....................     F-4
  Consolidated Statements of Stockholders' Equity...........     F-5
  Consolidated Statements of Cash Flows.....................     F-6
  Notes to Consolidated Financial Statements................     F-8
</TABLE>

                                      F-1
<PAGE>
                       REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Shareholders of Marketing Specialists Corporation
and Subsidiaries:

    In our opinion, the consolidated financial statements listed in the index
appearing under Item 14A on page F-1, present fairly, in all material respects,
the financial position of Marketing Specialists Corporation and its Subsidiaries
at December 31, 2000, and the results of their operations and their cash flows
for the year ended December 31, 2000 in conformity with accounting principles
generally accepted in the United States of America. These financial statements
are the responsibility of the Company's management; our responsibility is to
express an opinion on these financial statements based on our audit. We
conducted our audit of these statements in accordance with auditing standards
generally accepted in the United States of America, which require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion. The
financial statements of the Company as of December 31, 1999 and 1998, and for
the year ended December 31, 1999 and the period from inception (March 4, 1998)
to December 31, 1998, were audited by other independent accountants, whose
report dated March 3, 2000, except with respect to the matter discussed in
Note 17, as to which the date was March 30, 2000, expressed an unqualified
opinion on those statements.

    The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2 to the
consolidated financial statements, the Company has suffered recurring losses
from operations and negative operating cash flows and had negative working
capital at December 31, 2000. Additionally, during the year ended December 31,
2000, and the quarter ended March 31, 2001, the Company received cash infusions
totaling approximately $43.3 million and $12.0 million, respectively, from a
related party for working capital purposes. These matters raise substantial
doubt about the Company's ability to continue as a going concern. Management's
plans in regard to these matters are also described in Note 2. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.

PricewaterhouseCoopers LLP
Dallas, Texas
April 9, 2001, except as to
the "Amended Senior Credit Facility
Amendments" Section of Note 9,
which is as of April 19, 2001

                                      F-2
<PAGE>
                       REPORT OF INDEPENDENT ACCOUNTANTS

To Marketing Specialists Corporation and Subsidiaries:

    We have audited the accompanying consolidated balance sheets of Marketing
Specialists Corporation and Subsidiaries (formerly Merkert American Corporation
and Subsidiaries--the "Company") as of December 31, 1999 and 1998, and the
related consolidated statements of operations, stockholders' equity and cash
flows for the year ended December 31, 1999, and for the period from inception
(March 4, 1998) through December 31, 1998. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

    We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

    As discussed in Note 2, the Company incurred significant operating losses in
2000, and the auditors' report covering its 2000 financial statements expresses
substantial doubt about its ability to continue as a going concern.

    In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Marketing Specialists
Corporation and Subsidiaries as of December 31, 1999 and 1998, and the results
of their operations and their cash flows for the year ended December 31, 1999,
and for the period from inception (March 4, 1998) through December 31, 1998, in
conformity with accounting principles generally accepted in the United States.

ARTHUR ANDERSEN LLP

Boston, Massachusetts
March 3, 2000 (except with respect
to the matters discussed in Notes 2 and 9,
as to which the dates are April 9, 2001,
and March 30, 2000)

                                      F-2A
<PAGE>
               MARKETING SPECIALISTS CORPORATION AND SUBSIDIARIES

                          CONSOLIDATED BALANCE SHEETS

                      (IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                              DECEMBER 31,    DECEMBER 31,
                                                                  2000            1999
                                                              -------------   -------------
<S>                                                           <C>             <C>
                                          ASSETS
Current assets:
  Cash......................................................    $   2,905       $     --
  Restricted cash...........................................        1,676          1,200
  Accounts receivable, less allowances for doubtful accounts
    of $9,510 and $5,730, respectively......................       50,671         53,579
  Inventories...............................................          196          1,221
  Properties held for sale..................................           --          7,312
  Prepaid expenses and other current assets.................          609          2,895
                                                                ---------       --------
Total current assets........................................       56,057         66,207
Property, plant and equipment, net (Note 6).................       25,119         35,204
Intangible assets, net (Note 7).............................       52,133        338,540
Other assets................................................       11,438          9,665
                                                                ---------       --------
    Total assets............................................    $ 144,747       $449,616
                                                                =========       ========
                           LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Current portion of long-term obligations..................    $  68,407       $ 48,055
  Accounts payable..........................................       17,160          8,518
  Book overdrafts...........................................        2,905          5,878
  Accrued expenses (Note 8).................................       26,322         33,664
                                                                ---------       --------
Total current liabilities...................................      114,794         96,115
Long-term obligations, net of current portion (Note 9):
  Long-term debt and notes payable..........................      183,588        170,065
  Acquisition related deferred compensation liabilities.....       30,636         35,921
  Covenants not to compete..................................       15,737         21,041
  Obligations under capital lease...........................          562            804
                                                                ---------       --------
Total long-term obligations, net of current portion.........      230,523        227,831
Other liabilities, net of current portion (Notes 14 and
  18).......................................................        8,054          7,428
Commitments and contingent liabilities (Note 13)
Series B 8.0% redeemable convertible preferred stock, at
  stated value
  Authorized shares--20,000; issued and outstanding
    shares--12,397 and 0, respectively (Note 14)............       12,397             --
Stockholders' equity (Note 15):
  Common stock, $0.01 par value; authorized
    shares--54,000,000
    Issued shares--26,025,252 and 14,213,551, respectively
    Outstanding shares--25,985,545 and 14,173,844,
      respectively..........................................          260            142
  Additional paid-in capital................................      169,346        143,080
  Note for sale of common stock (Note 12)...................       (1,500)        (1,500)
  Accumulated deficit.......................................     (388,680)       (23,033)
  Treasury stock, at cost--39,707 shares....................         (447)          (447)
                                                                ---------       --------
Total stockholders' equity (deficit)........................     (221,021)       118,242
                                                                ---------       --------
Total liabilities and stockholders' equity..................    $ 144,747       $449,616
                                                                =========       ========
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-3
<PAGE>
               MARKETING SPECIALISTS CORPORATION AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF OPERATIONS

               (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                    YEAR ENDED DECEMBER 31,    PERIOD FROM INCEPTION
                                                    ------------------------    (MARCH 4, 1998) TO
                                                       2000          1999        DECEMBER 31, 1998
                                                    -----------   ----------   ---------------------
<S>                                                 <C>           <C>          <C>
Revenues, net.....................................  $   380,830   $  246,612        $    5,975

Expenses:
  Selling expenses................................      287,255      174,109             4,293
  General and administrative expenses.............       70,080       54,104             2,742
  Depreciation....................................        7,533        3,834                53
  Amortization....................................       19,572        9,670               126
  Impairment loss (Note 7)........................      306,953           --                --
  Nonrecurring charges (Note 18)..................       19,451           --                --
  Restructuring charges (Note 18).................        2,520       13,290                --
                                                    -----------   ----------        ----------
Total operating expenses..........................      713,364      255,007             7,214
                                                    -----------   ----------        ----------

Operating loss....................................     (332,534)      (8,395)           (1,239)

Other income (expenses):
  Interest expense, net...........................      (32,647)     (13,854)             (273)
  Other income (expense)..........................          351          247                (6)
                                                    -----------   ----------        ----------

Loss before income tax expense and discontinued
  operations......................................     (364,830)     (22,002)           (1,518)

Income tax expense................................           --           --                --
                                                    -----------   ----------        ----------
Loss from continuing operations...................     (364,830)     (22,002)           (1,518)

Discontinued operations (Note 20):
  Income from operations, net of tax..............        1,298          435                52
  Loss on disposal, net of tax....................       (1,936)          --                --
                                                    -----------   ----------        ----------
Income (loss) from discontinued operations........         (638)         435                52
                                                    -----------   ----------        ----------
Net loss..........................................  $  (365,468)  $  (21,567)       $   (1,466)
Cumulative preferred dividends not declared.......         (179)          --                --
                                                    -----------   ----------        ----------
Net loss available to common......................  $  (365,647)  $       --        $       --
                                                    ===========   ==========        ==========
Loss from continuing operations per share.........  $    (17.38)  $    (2.20)       $    (0.81)
                                                    ===========   ==========        ==========
Loss from discontinued operations per share.......  $     (0.03)  $     0.04        $     0.03
                                                    ===========   ==========        ==========
Net loss per share--basic and diluted.............  $    (17.41)  $    (2.16)       $    (0.78)
                                                    ===========   ==========        ==========
Weighted average shares outstanding--basic and
  diluted.........................................   20,998,381    9,973,759         1,891,000
                                                    ===========   ==========        ==========
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-4
<PAGE>
               MARKETING SPECIALISTS CORPORATION AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                      (IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                                       NOTE FOR
                                      COMMON STOCK,       ADDITIONAL    SALE OF                  TREASURY
                                     $0.01 PAR VALUE       PAID-IN      COMMON     ACCUMULATED    STOCK,
                                    SHARES      AMOUNT     CAPITAL       STOCK       DEFICIT     AT COST      TOTAL
                                  ----------   --------   ----------   ---------   -----------   --------   ---------
<S>                               <C>          <C>        <C>          <C>         <C>           <C>        <C>
BALANCE, MARCH 4, 1998..........          --     $ --      $     --     $    --     $      --     $  --     $      --
Shares issued upon founding the
  organization..................   1,376,111       14           (14)         --            --        --            --
Shares issued to employee.......     275,222        2         2,769      (1,500)           --        --         1,271
Shares issued in connection with
  the Combination...............   1,166,667       12        14,863          --            --        --        14,875
Shares issued in connection with
  the Offering, net of
  expenses......................   4,400,000       44        57,871          --            --        --        57,915
Net loss........................          --       --            --          --        (1,466)       --        (1,466)
                                  ----------     ----      --------     -------     ---------     -----     ---------

BALANCE, DECEMBER 31, 1998......   7,218,000     $ 72      $ 75,489     $(1,500)    $  (1,466)    $  --     $  72,595
Shares issued upon exercise of
  over-allotment option.........     290,000        3         4,043          --            --        --         4,046
Shares issued in connection with
  the Merger....................   6,705,551       67        63,364          --            --        --        63,431
Deferred compensation--option
  plans.........................          --       --           184          --            --        --           184
Treasury stock purchases........     (39,707)      --            --          --            --      (447)         (447)
Net loss........................          --       --            --          --       (21,567)       --       (21,567)
                                  ----------     ----      --------     -------     ---------     -----     ---------

BALANCE, DECEMBER 31, 1999......  14,173,844     $142      $143,080     $(1,500)    $ (23,033)    $(447)    $ 118,242
Shares issued to MS
  Acquisition...................   5,577,287       56        14,944          --            --        --        15,000
Conversion of preferred shares
  to common.....................   6,234,414       62         9,438          --            --        --         9,500
Fair value of detachable stock
  warrants......................          --       --         1,700          --            --        --         1,700
Deferred compensation--option
  plans.........................          --       --           184          --            --        --           184
Net loss........................          --       --            --          --      (365,468)       --      (365,468)
Cumulative preferred dividends
  not declared..................          --       --            --          --          (179)       --          (179)
                                  ----------     ----      --------     -------     ---------     -----     ---------

BALANCE, DECEMBER 31, 2000......  25,985,545     $260      $169,346     $(1,500)    $(388,680)    $(447)    $(221,021)
                                  ==========     ====      ========     =======     =========     =====     =========
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-5
<PAGE>
               MARKETING SPECIALISTS CORPORATION AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                          INCEPTION
                                                          YEAR ENDED DECEMBER 31,    (MARCH 4, 1998) TO
                                                             2000          1999       DECEMBER 31, 1998
                                                          -----------   ----------   -------------------
<S>                                                       <C>           <C>          <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss..............................................   $(365,468)    $(21,567)         $(1,466)
  Adjustments to reconcile net loss to net cash provided
    by (used in) operating activities--
  Depreciation..........................................       7,533        3,834               52
  Amortization..........................................      19,572        9,670              127
  Impairment loss.......................................     306,953           --               --
  Nonrecurring charges related to trade receivables.....      19,451           --               --
  Restructuring charge related to leases and
    personnel...........................................       2,520       13,290               --
  Expense related to capitalized financing costs........       3,813          210               --
  Disposal loss related to sale of Buy Sell.............       1,936           --               --
  Other.................................................       1,365          720               --
  Changes in operating assets and liabilities--
    Restricted cash.....................................         275        1,587              (28)
    Accounts receivable.................................     (22,996)       8,531              950
    Income taxes receivable.............................          --        2,452               --
    Inventories.........................................        (271)         402             (277)
    Prepaid expenses and other current assets...........       2,068          (32)              --
    Other assets........................................         356        2,031               --
    Accounts payable....................................      12,100       (7,507)          (3,141)
    Accrued expenses....................................     (15,183)     (17,344)           1,700
                                                           ---------     --------          -------

Net cash provided by (used in) operating activities.....     (25,976)      (3,723)          (2,083)
CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchases of property and equipment...................      (1,489)      (1,583)              --
  Proceeds from the disposal of fixed assets............       8,628           --               --
  Cash paid, net of cash assumed, in purchase of
    businesses..........................................     (11,981)     (13,711)         (96,147)
                                                           ---------     --------          -------

Net cash used in investing activities...................      (4,842)     (15,294)         (96,147)
CASH FLOWS FROM FINANCING ACTIVITIES:
  Book overdrafts.......................................      (2,973)       5,878               --
  Restricted cash.......................................          --        9,015           (9,000)
  Net borrowings under credit facility..................      28,567       20,300           50,000
  Proceeds from issuance of note to MS Acquisition......       2,500           --               --
  Principal payments on notes payable and other
    long-term obligations...............................     (20,287)     (18,951)              --
  Principal payments on acquisition related deferred
    compensation liabilities............................      (4,762)      (1,304)              --
  Principal payments on covenants not to compete........      (4,403)        (898)              --
  Capitalized financing costs...........................      (5,669)          --               --
  Proceeds related to stock issuance, net of expenses...      36,750        3,792           57,915
  Proceeds related to issuable preferred stock..........       4,000           --               --
                                                           ---------     --------          -------
Net cash provided by financing activities...............      33,723       17,832           98,915
                                                           ---------     --------          -------
</TABLE>

                                      F-6
<PAGE>
               MARKETING SPECIALISTS CORPORATION AND SUBSIDIARIES

               CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                          INCEPTION
                                                          YEAR ENDED DECEMBER 31,    (MARCH 4, 1998) TO
                                                             2000          1999       DECEMBER 31, 1998
                                                          -----------   ----------   -------------------
<S>                                                       <C>           <C>          <C>
Net change in cash......................................       2,905       (1,185)             685
Cash at beginning of period.............................          --        1,185              500
                                                           ---------     --------          -------
Cash at end of period...................................   $   2,905     $     --          $ 1,185
                                                           =========     ========          =======
SUPPLEMENTAL DISCLOSURES OF:
  Cash flow information--
    Cash payments for interest..........................   $  26,672     $ 12,558          $     7
                                                           =========     ========          =======
    Cash payments for income taxes......................   $     475     $     54          $    --
                                                           =========     ========          =======
  Non-cash flow information--
    Common stock issued in the Merger...................   $      --     $ 63,431          $    --
                                                           =========     ========          =======
    Common stock issued in the Combination..............   $      --     $     --          $14,875
                                                           =========     ========          =======
    Acquisition cost financed with debt.................   $  14,778     $ 11,513          $    --
                                                           =========     ========          =======
    Net liabilities assumed from acquisitions...........   $   4,638     $125,190          $    --
                                                           =========     ========          =======
    Conversion of preferred stock to common stock.......   $   9,500     $     --          $    --
                                                           =========     ========          =======
    Conversion of debt to preferred stock...............   $   9,750     $     --          $    --
                                                           =========     ========          =======
    Allocation of term loan value to stock warrants.....   $   1,700     $     --          $    --
                                                           =========     ========          =======
    Note for sale of common stock.......................   $      --     $     --          $ 1,500
                                                           =========     ========          =======
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-7
<PAGE>
1.  BUSINESS AND ORGANIZATION

    Marketing Specialists Corporation (formerly Merkert American
Corporation--the "Company") was incorporated on March 4, 1998, to create a
leading national food brokerage firm providing outsourced sales, merchandising
and marketing services to manufacturers, suppliers and producers of food
products and consumer goods ("Manufacturers"). On December 18, 1998,
simultaneously with the consummation of the Company's Initial Public Offering
(the "Offering"), the Company purchased, in separate transactions (collectively,
the "Combination") all of the issued and outstanding capital stock of Merkert
Enterprises, Inc., a Massachusetts corporation ("Merkert") and Rogers-American
Company, Inc., a North Carolina corporation ("Rogers"). From March 4, 1998
through December 18, 1998, the Company's only operations related to the Offering
and Combination.

    On August 18, 1999, the Company completed a merger with Dallas, Texas-based
Richmont Marketing Specialists Inc. ("RMSI") and changed its name to Marketing
Specialists Corporation (the "Merger"--see Note 5).

    The Company acts as an independent sales and marketing representative,
selling grocery and consumer products on behalf of Manufacturers and
coordinating the execution of Manufacturers' marketing programs with retailers,
mass merchandisers, supercenters, membership warehouses, drug stores, speciality
food outlets, and wholesalers ("Retailers"). The Company's principal source of
revenue is commissions it receives from Manufacturers. Historically, the
Company's other activities included managing private label programs on behalf of
selected Retailers. On July 31, 2000, the Company decided to sell its private
label business, and on January 19, 2001, the Company completed the sale. See
Note 20 for additional information.

2.  MANAGEMENT'S PLANS, LIQUIDITY AND CAPITAL RESOURCES

    The operating environment confronting the Company raises uncertainty about
the Company's ability to continue as a going concern. The principal conditions
giving rise to that uncertainty include the following:

    - The Company has incurred losses and negative operating cash flows in every
      fiscal period since its inception. For the year ended December 31, 2000,
      the Company incurred a loss from continuing operations of approximately
      ($364.8) million, which included a goodwill impairment loss of
      approximately ($307.0) million, and negative operating cash flows of
      approximately ($26.0) million.

    - As of December 31, 2000, the Company had negative working capital of
      approximately ($58.7) million, which included ($29.9) million related to
      the Amended Credit Agreement (as defined) and ($19.0) million related to
      the First Union Amended Credit Agreement (as defined). Both Agreements
      expire in March 2002.

    - During 2000, the Company's primary stockholder provided approximately
      $43.3 million of funds to the Company and participated in the First Union
      Amended Credit Agreement, both of which provided liquidity to meet the
      current obligations under the Company's various debt agreements. During
      the quarter ended March 31, 2001, the primary stockholder provided
      approximately $12.0 million of funds to the Company.

    - The share price of the Company's Common Stock has decreased from $15.50 in
      the first quarter of 1999 to a low of $0.19 in the fourth quarter of 2000.

    - The rating of Company's public debt, the Registered Notes, was downgraded
      to a CCC- in December 2000. Based on recent trading, the Registered Notes
      have an aggregate fair value of approximately $11.3 million.

                                      F-8
<PAGE>
    During the latter part of 2000, the Company implemented an aggressive
initiative designed to improve efficiency and reduce costs. The Company reduced
its workforces by approximately 6%, providing $11.5 million in annual savings,
and consolidated 15 offices (17% of the occupied facilities). The Company also
made changes to its organizational structure to focus on the key components of
the business, improve financial reporting systems and controls, and develop a
more effective sales and marketing strategy.

    Management believes that the successful implementation of the initiatives
will enable the Company to achieve profitability. Management believes that the
cost reductions, improved financial and operating controls, and a focused sales
and marketing effort should provide positive results from operations and cash
flows in the near term. Management also believes that the long-term benefits of
the plan will stabilize the Company and improve its financial ratios.

    Achievement of projected cash flows from operations, however, will be
dependent upon the Company's attainment of forecasted revenues, improved
operating costs and trade support levels that are consistent with its financial
plans. Such operating performance will be subject to financial, economic and
other factors affecting the industry and operations of the Company, including
factors beyond its control, and there can be no assurance that the Company's
plans will be achieved. In addition, the Company borrows funds on a variable
rate basis, and continued compliance with loan covenants is partially dependent
on relative interest rate stability. If projected cash flows from operations are
not realized, or if there are significant increases in interest rates, then the
Company may have to explore various available alternatives, including obtaining
further modifications of its existing lending arrangements, renegotiating debt
payments associated with acquired companies, seeking additional contributions of
equity or loans from MS Acquisition or attempting to locate additional sources
of financing, all of which are beyond the Company's control and provide no
certainty of success.

3.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    The following is a summary of significant accounting policies followed in
the preparation of these financial statements.

    PRINCIPLES OF CONSOLIDATION

    The consolidated financial statements include the accounts of the Company
and its wholly owned subsidiaries. All significant intercompany accounts and
transactions have been eliminated in consolidation.

    USE OF ESTIMATES

    The preparation of consolidated financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the consolidated financial
statements and accompanying notes. Actual results could differ from those
estimates.

    REVENUE RECOGNITION

    Revenue is earned from commissions on sales of food products and consumer
goods on behalf of Manufacturers. Commission revenue is recorded as income when
product shipment has occurred and notification of such shipment is received from
the Manufacturers. The Company recognizes product sales revenue upon shipment.
Revenues are presented net of allowances and deductions taken by Manufacturers.

                                      F-9
<PAGE>
    FAIR VALUE OF FINANCIAL INSTRUMENTS

    The estimated fair value of financial instruments has been determined by the
Company using available market information and appropriate methodologies;
however, considerable judgment is required in interpreting market data to
develop these estimates.

    The fair values of cash and cash equivalents, accounts receivable, trade
payables and long-term debt, excluding the Registered Notes, approximated
carrying value at December 31, 2000, due to the short period of time to maturity
of the current assets and liabilities and the nature of the long-term debt.
Valuations for short-term debt are determined using borrowing rates available to
the Company for loans with similar terms and similar maturities. Based on recent
trading information, the fair value of the Registered Notes is approximately
$11.3 million, as compared to a carrying value of $100.0 million.

    NET LOSS PER SHARE

    The basic and diluted net loss per share is computed based upon the weighted
average number of shares outstanding of 20,998,381 and 9,973,759 for the years
ended December 31, 2000 and 1999, respectively, and 1,891,000 for the period
ended December 31, 1998. The effect of outstanding options as of December 31,
2000 and 1999 (1,549,099 and 1,411,209, respectively) and warrants as of
December 31, 2000 (687,136) is anti-dilutive.

    STATEMENTS OF CASH FLOWS

    The Company considers all highly liquid investments, which are not
restricted, with maturities of three months or less when purchased to be cash
equivalents.

    CONCENTRATION OF CREDIT RISK

    Financial instruments that potentially subject the Company to concentrations
of credit risk principally consist of accounts receivable and notes receivable.
As of December 31, 2000 and 1999, no individual Manufacturer represents a
significant concentration of accounts receivable. The Company generally does not
require collateral on accounts receivable and notes receivable, as the Company's
Manufacturers are generally large, well-established companies. The Company
periodically performs credit evaluations of its Manufacturers and maintains
reserves for potential losses. The established reserves and the credit losses
have historically been within Company estimates.

    PROPERTY AND EQUIPMENT

    Property and equipment are stated at cost. Depreciation and amortization are
computed using straight-line or accelerated methods over the estimated useful
lives. Gains or losses resulting from fixed asset disposals are reported as a
component of Other Income in the Consolidated Statements of Operations. See
Note 6.

    INTANGIBLE ASSETS

    Intangible assets include goodwill, covenants not to compete, Manufacturer
relationships, and trained workforce. Goodwill represents the excess of the
purchase price over the fair value of the net assets of various businesses
acquired. The recorded goodwill is amortized over its estimated useful life,
which ranges from 20 to 40 years. Non-compete assets are recorded at fair value
and are amortized over the term of the related agreement, generally 1 to
10 years. Manufacturer relationships and trained workforce are recorded at
estimated fair value based on independent appraisals and are amortized over
periods ranging from 1 to 10 years. See "Impairment of Long-Lived Assets" below.
See Note 7.

                                      F-10
<PAGE>
    INCOME TAXES

    The Company provides for income taxes in accordance with Statement of
Financial Accounting Standards ("SFAS") 109, Accounting for Income Taxes.
SFAS 109 recognizes tax assets and liabilities for the cumulative effect of all
temporary differences between the financial statement carrying amounts and the
tax basis of assets and liabilities and are measured using the enacted tax rates
which will be in effect when these differences are expected to reverse. The
Company has recognized a valuation allowance equal to its deferred tax assets,
as it is more likely than not that the benefits will not be realized. See
Note 10.

    COMPREHENSIVE INCOME

    In 1998, the Company adopted SFAS 130, Reporting Comprehensive Income, which
establishes standards for the reporting and display of comprehensive income and
other comprehensive income items. In general, comprehensive income combines net
income and other changes in equity during the year from non-owner sources. There
were no other components of comprehensive income for the periods presented.

    NEW ACCOUNTING PRONOUNCEMENTS

    In June 1998, the Financial Accounting Standards Board ("FASB") issued
SFAS 133, Accounting for Derivative Instruments and Hedging Activities. This
statement established accounting and reporting standards requiring that every
derivative instrument (including certain derivative instruments embedded in
other contracts and for hedging activities) be recorded in the balance sheet as
either an asset or liability measured at its fair value. SFAS 133 requires that
changes in the derivative's fair value be recognized currently in earnings
unless specific hedging accounting criteria are met. Special accounting for
qualifying hedges allows a derivative's gains and losses to offset related
results on the hedged item in the income statement, and requires that a company
must formally document, designate and assess the effectiveness of transactions
that receive hedge accounting. SFAS 133 is effective for fiscal years beginning
after June 15, 2000. A company may also implement SFAS 133 as of the beginning
of any fiscal quarter after issuance (that is, fiscal quarters beginning
June 16, 1998 and thereafter). SFAS 133 cannot be applied retroactively. The
Company does not anticipate that the adoption of this new standard will have a
material impact on the Company's fiscal position or results of operations.

    RESTRUCTURING

    In accordance with the SEC's Staff Accounting Bulletin Number 67, the
Company expenses restructuring charges and presents them as part of the
calculation of income from continuing operations. The Company recognizes such
items as noncancelable lease commitments, employee termination benefits and
other costs related to a restructuring pursuant to EITF Issue Number 94-3. See
Note 18.

    IMPAIRMENT OF LONG-LIVED ASSETS

    The Company evaluates the carrying value of its long-lived assets in
accordance with SFAS 121, Accounting for the Impairment of Long-Lived Assets and
Long-Lived Assets to Be Disposed Of. Accordingly, the Company evaluates
long-lived assets including property and equipment and intangible assets
whenever events or changes in circumstances indicate that the carrying value may
not be recoverable. Under SFAS 121, an assessment is made to determine whether
the sum of the expected future undiscounted cash flows from the use of the
assets and eventual disposition is less than the carrying value. If the sum of
the expected undiscounted cash flows is less than the carrying value, an
impairment loss is recognized by measuring the excess of carrying value over
fair value (generally

                                      F-11
<PAGE>
estimated by projected future discounted cash flows for the applicable
operation, or by independent appraisal). See Note 7 for a discussion of the
goodwill impairment loss recognized in 2000.

    STOCK-BASED COMPENSATION PLANS

    The Company accounts for its stock-based compensation plans under Accounting
Principles Board Opinion No. 25, Accounting for Stock Issued to Employees. The
Company has adopted the disclosure-only provisions of SFAS 123, Accounting for
Stock-Based Compensation. See Note 16.

    PROMOTIONAL ADVANCES

    Promotional advances represent amounts received from Manufacturers for the
future promotion of their products. Such amounts are recorded as liabilities
until they are spent on behalf of and under the direction of the Manufacturers.

    PRIOR YEAR RECLASSIFICATIONS

    Certain prior-year balances have been reclassified to conform to the
current-year presentation.

4.  THE OFFERING

    On December 18, 1998, the Company completed the Offering and sold 4,400,000
shares of its Common Stock at a price of $15.00 per share and received net
proceeds of approximately $57.9 million used primarily to fund the Combination.
The Common Stock sold in the Offering does not include an additional 1,651,333
shares issued to related parties in connection with the organization and initial
capitalization of the Company nor 1,166,667 shares issued in connection with the
Combination (see Note 5). In January 1999, the Company issued 290,000 shares of
its Common Stock in connection with the exercise of a portion of the
over-allotment option by the underwriters of the Offering, raising net proceeds
of approximately $4.0 million, which the Company used to fund certain
acquisitions and for other corporate purposes (see Note 5).

    The Company and certain executives and directors are parties to a
Registration Rights Agreement, as amended, pursuant to which the individuals
have certain "piggy-back" registration rights in the event the Company registers
any of its securities for either itself or for security holders exercising their
registration rights.

    In connection with the Combination, the Company entered into Registration
Rights Agreements with the former stockholders of Merkert and Rogers. Subject to
certain restrictions, former stockholders have the right to include their shares
of Common Stock received in the Combination in a registration statement filed by
the Company under the Securities Act of 1933, as amended (the "Securities Act").

5.  BUSINESS COMBINATIONS

    THE COMBINATION

    In December 1998, concurrently with and as a condition to the consummation
of the Offering, the Company purchased all of the outstanding capital stock of
Merkert and Rogers. The Company was designated as the accounting acquirer
pursuant to Staff Accounting Bulletin 97, because the then current stockholders
of the Company owned the largest portion of Common Stock after the consummation
of the Offering and the Combination.

    The aggregate consideration paid by the Company for Merkert and Rogers was
approximately $74.1 million, consisting of approximately $56.6 million in cash
and 1,166,667 shares of Common Stock. In connection with the Combination, the
Company repaid approximately $34.0 million of indebtedness

                                      F-12
<PAGE>
and certain then existing acquisition obligations of Merkert and Rogers from a
portion of the net proceeds of the Offering and from net available borrowings
under the Company's $75.0 million Credit Facility. In addition, on behalf of
Merkert, the Company funded approximately $1.5 million of buyouts of certain
employment agreements with two former Merkert employees.

    The Combination was accounted for using the purchase method of accounting;
accordingly, the results of operations of Merkert and Rogers have been included
in the accompanying consolidated financial statements from December 18, 1998.
The Company recorded the excess of the purchase price over the estimated fair
value of the businesses acquired, approximately $124.6 million (net of
approximately $2.0 million in value assigned to certain noncompete agreements)
as "goodwill" in the accompanying consolidated balance sheets. The goodwill was
being amortized over a 40-year period.

    THE MERGER

    On August 18, 1999, the Company completed a merger with Dallas, Texas-based
RMSI, one of the largest food brokers in the United States (the "Merger"). The
Company completed the Merger for an aggregate purchase price of approximately
$236.8 million, which included approximately $3.4 million in cash payments
(i.e., for closing costs), no new debt, $170.0 million in assumed debt and
$63.4 million in Common Stock and options. Under the terms of the Merger, RMSI
stockholders received 6,705,551 shares of the Company's Common Stock. The
Company also granted certain RMSI stockholders and employees options to purchase
800,000 in additional shares of the Company's Common Stock at a price equal to
$13.50 per share. For financial reporting purposes, the Company is presented as
the acquiring entity, since the Company's stockholders own the largest portion
of the Common Stock of the combined Company. Immediately following the Merger,
the Company amended its certificate of incorporation to change its corporate
name to "Marketing Specialists Corporation." The purchase price was allocated to
the net assets of RMSI based on their estimated fair values. The Company
recorded the excess of the purchase price over the estimated fair value of the
net assets acquired, approximately $133.2 million (net of approximately
$11.1 million, $20.0 million, and $32.0 million assigned to non-competes,
trained workforce, and Manufacturer relationships, respectively) as goodwill in
the accompanying consolidated balance sheets and was amortizing it over a period
of 40 years. See Note 3 for a discussion of the estimated useful life of each
category of intangible assets. The operating results of RMSI have been included
in the Company's operating results for all periods subsequent to the Merger.

    The following table presents unaudited pro forma operating results
(excluding restructuring charges) as if RMSI merged with the Company at
January 1, 1999 (unaudited and amounts in thousands except share and per share
information):

<TABLE>
<CAPTION>
                                                              YEAR ENDED
                                                               12/31/99
                                                              -----------
<S>                                                           <C>
Revenues....................................................  $   379,596
Net loss....................................................      (22,326)
Net loss per share--basic and diluted.......................  $     (1.57)
Weighted averages shares outstanding--basic and diluted.....   14,198,648
</TABLE>

    OTHER ACQUISITIONS

    In January 1999, the Company completed the acquisition of Sell, Inc.
("Sell"), a brokerage firm operating in the Midwest region of the United States.
The Company completed the acquisition of Sell for an aggregate discounted
purchase price of approximately $8.5 million, which included approximately
$3.1 million in cash payments, $3.8 million in new debt, and $1.6 million in
assumed debt. The operating results of Sell have been included in the Company's
operating results for all periods subsequent to the acquisition date.

                                      F-13
<PAGE>
    In April 1999, the Company completed the acquisition of United Brokerage
Company ("UBC"), a brokerage firm that has operated in the Midwest region of the
United States under an alliance known as "The Sell Group" since 1998. The
Company completed the acquisition of UBC for an aggregate discounted purchase
price of approximately $6.7 million, which included approximately $1.0 million
in cash payments, $3.3 million in new debt, and $2.4 million in assumed debt.
The operating results of UBC have been included in the Company's operating
results for all periods subsequent to the acquisition date.

    In July 1999, the Company completed the acquisition of Buckeye Sales and
Marketing ("Buckeye"), a brokerage firm with operations in Cleveland, Ohio;
Pittsburgh, Pennsylvania; and upstate New York markets. The Company completed
the acquisition of Buckeye for an aggregate discounted purchase price of
approximately $5.0 million, which included approximately $0.1 million in cash
payments, $3.4 million in new debt, and $1.5 million in assumed debt. The
operating results of Buckeye have been included in the Company's operating
results for all periods subsequent to the acquisition date.

    In October 1999, the Company completed the acquisition of Paul Inman
Associates, Inc. ("Inman"), a brokerage firm operating in the Midwest region of
the United States. The Company completed the acquisition of Inman for an
aggregate discounted purchase price of approximately $14.0 million, which
included approximately $9.8 million in cash payments, $1.0 million in new debt,
and $3.2 million in assumed debt. The operating results of Inman have been
included in the Company's operating results for all periods subsequent to the
acquisition date.

    In January 2000, the Company acquired Johnson-Leiber, Inc.
("Johnson-Leiber"), a brokerage firm operating in the Seattle, Washington;
Spokane, Washington; Portland, Oregon; Billings, Montana; and Anchorage, Alaska
markets. The Company acquired Johnson-Leiber for an aggregate discounted
purchase price of approximately $10.2 million, which included approximately
$3.2 million in cash payments and $7.0 million in new debt and other incentives.
The Company recorded the excess of the purchase price over the estimated fair
value of the net assets acquired, approximately $10.2, as goodwill.

    In April 2000, the Company acquired the Sales Force Companies, Inc. ("Sales
Force"), a full service brokerage firm operating in the Central Region of the
United States. The Company acquired Sales Force for an aggregate discounted
purchase price of approximately $18.8 million, which included approximately
$6.1 million cash payments, $7.8 million in new debt, and $4.9 million in
assumed debt. The Company recorded the excess of the purchase price over the
estimated fair value of the net assets acquired, approximately $23.0 million
(net of approximately $0.5 million assigned to non-competes), as goodwill.

    Each of the above acquisitions was accounted for as a purchase, and the
purchase price was allocated to the net assets based on their estimated fair
values. The resulting goodwill was being amortized over 20 years. The pro forma
impact of each of the above acquisitions was not material.

                                      F-14
<PAGE>
6.  PROPERTY AND EQUIPMENT

    Property and equipment consists of the following (amounts in thousands):

<TABLE>
<CAPTION>
                                                    DECEMBER 31,
                                                 -------------------   USEFUL LIVES
                                                   2000       1999       (YEARS)
                                                 --------   --------   ------------
<S>                                              <C>        <C>        <C>
Land...........................................  $  1,081   $ 5,233         --
Buildings and improvements.....................    13,127    14,139         40
Leasehold improvements.........................     2,939     1,699          5
Furniture, fixtures and equipment..............    14,617    14,362        3-5
Purchased software.............................     4,109     3,398          3
                                                 --------   -------
                                                   35,873    38,831
Less--accumulated depreciation.................   (10,754)   (3,627)
                                                 --------   -------
                                                 $ 25,119   $35,204
                                                 ========   =======
</TABLE>

    Depreciation expense was approximately $7.5 million and $3.8 million for the
years ended December 31, 2000 and 1999, respectively, of which approximately
$1.9 million and $0.3 million related to purchased software. Depreciation
expense for the period ended December 31, 1998, was not material.

    As of December 31, 1999, current assets in the accompanying consolidated
balance sheet included approximately $7.3 million of properties held for sale.
In February 2000, the Company sold certain improved real properties containing
general office and warehouse space situated in Arizona and California to a
related party for approximately $6.5 million after related costs. In
December 2000, the Company sold improved real property containing general office
space situated in Charlotte, North Carolina for approximately $2.1 million after
related costs.

7.  INTANGIBLE ASSETS

    Intangible assets consist of the following (amounts in thousands):

<TABLE>
<CAPTION>
                                                             DECEMBER 31,
                                                          -------------------
                                                            2000       1999
                                                          --------   --------
<S>                                                       <C>        <C>
Goodwill................................................  $     --   $282,464
Manufacturer relationships..............................    32,000     32,000
Trained workforce.......................................    20,000     20,000
Covenants not to compete................................    13,570     13,095
                                                          --------   --------
                                                            65,570    347,559
Less--accumulated amortization..........................   (13,437)    (9,019)
                                                          --------   --------
                                                          $ 52,133   $338,540
                                                          ========   ========
</TABLE>

    Amortization expense related to intangible assets was approximately
$18.8 million and $8.9 million for the years ended December 31, 2000 and 1999,
respectively, and $0.1 million for the period ended December 31, 1998.

    The Company recorded approximately $38.9 million of additional goodwill in
2000, which was primarily related to Johnson-Leiber, Sales Force, and the
Merger. The Company's continued operating losses, negative operating cash flows
and frequent cash infusions from a related party for working capital purposes
indicated that long-lived assets may be impaired. A goodwill impairment analysis
performed at the end of 2000 indicated that the Company's recorded goodwill
exceeded the Company's estimated future cash flows, undiscounted and excluding
interest charges. Accordingly, an impairment loss was measured using discounted
cash flows compared to recorded goodwill. During the fourth quarter of 2000, the
Company recognized an impairment loss of approximately ($307.0) million, or
($14.62) per share, which equaled the Company's net goodwill balance as of
December 31, 2000. The impairment loss appears as a component of the Company's
loss from continuing operations.

                                      F-15
<PAGE>
8.  ACCRUED EXPENSES

    Accrued expenses consist of the following (amounts in thousands):

<TABLE>
<CAPTION>
                                                               DECEMBER 31,
                                                            -------------------
                                                              2000       1999
                                                            --------   --------
<S>                                                         <C>        <C>
Compensation and related..................................  $10,464    $11,733
Restructuring--current portion............................    4,136      8,189
Commission splits.........................................    2,175      1,138
Other accruals............................................    9,547     12,604
                                                            -------    -------
                                                            $26,322    $33,664
                                                            =======    =======
</TABLE>

9.  LONG-TERM OBLIGATIONS

    DEBT

    Debt consists of the following (amounts in thousands):

<TABLE>
<CAPTION>
                                                             DECEMBER 31,
                                                          -------------------
                                                            2000       1999
                                                          --------   --------
<S>                                                       <C>        <C>
$100,000, 10.125% Senior Subordinated Notes, due
  December 15, 2007.....................................  $100,000   $100,000
Initial Term Loan.......................................        --     43,750
Initial Revolving Credit................................        --     20,300
First Union Amended Credit Agreement....................    33,938         --
Amended Revolver........................................    29,866         --
Notes payable...........................................    37,698     26,113
Bank--mortgage loans....................................     8,938     12,781
Tranche B Note..........................................    19,000         --
Other notes payable involving related parties...........    14,635      6,266
                                                          --------   --------
                                                           244,075    209,210
Less current maturities.................................   (60,487)   (39,145)
                                                          --------   --------
  Net long-term term-debt...............................  $183,588   $170,065
                                                          ========   ========
</TABLE>

    The aggregate maturities of debt as of December 31, 2000 are the following:

<TABLE>
<S>                                                           <C>
2001........................................................  $ 60,487
2002........................................................    44,266
2003........................................................     7,623
2004........................................................     6,714
2005........................................................     6,158
Thereafter..................................................   118,827
                                                              --------
                                                              $244,075
                                                              ========
</TABLE>

    SENIOR SUBORDINATED NOTES

    In December 1997, concurrently with the sale by RMSI of $100.0 million of
10 1/8% Senior Subordinated Notes due 2007 (the "Issued Notes"), RMSI entered
into an Exchange and Registration Rights Agreement with the initial purchaser of
the Issued Notes. Under the terms of that agreement, RMSI agreed to file a
registration statement regarding the exchange of the Issued Notes for new notes

                                      F-16
<PAGE>
registered under the Securities Act of 1933, and to offer the holders of the
Issued Notes an opportunity to exchange their unregistered notes for registered
notes.

    On June 21, 1999, RMSI filed a Registration Statement on Form S-4 with the
Securities and Exchange Commission to register $100.0 million of new notes (the
"Registered Notes"). Subsequently, RMSI completed an exchange of the Issued
Notes for the Registered Notes. The Registered Notes are identical in all
material respects to the Issued Notes, except for transfer restrictions and
registration rights. The Company assumed this outstanding indebtedness in
connection with the Merger.

    The Registered Notes are unsecured and are subordinated in right of payment
to all existing and future senior indebtedness of the Company. The Registered
Notes are fully and unconditionally guaranteed on an unsecured, senior
subordinated, joint and several basis by certain guarantor wholly-owned
subsidiaries of the Company as defined in the Registration Statement, which
comprise substantially all the direct and indirect subsidiaries of the Company.
The Company is a holding company with no assets, liabilities or operations other
than its interests in its subsidiaries. Separate financial statements and other
disclosures for such subsidiaries have not been presented due to management's
determination that such information is not material to investors.

    Interest on the Registered Notes is payable semiannually on June 15 and
December 15 of each year, commencing June 15, 1998. The principal on the
Registered Notes is payable on December 15, 2007, the maturity date. The Company
may not redeem the Registered Notes prior to December 15, 2002, except as
described below. On or after such date, the Company may redeem the Registered
Notes, in whole or in part, at the following redemption prices: 2002-105.063%;
2003-103.375%; 2004-101.688%; 2005 or thereafter-100.000%, together with accrued
and unpaid interest, if any, to the date of redemption. The Registered Notes are
not subject to any sinking fund requirement. Upon a change of control, as
defined (not triggered by the Merger), each holder of the Registered Notes will
have the right to require the Company to make an offer to repurchase such
holder's Registered Notes at a price equal to 101% of the principal amount
thereof, together with accrued and unpaid interest, if any, to the date of
repurchase.

    The Registered Notes subject the Company to certain limitations and
restrictions primarily related to obtaining additional indebtedness, payment of
dividends, and sales of assets and subsidiary stock, which may require the
consent of the holders of the Registered Notes.

    In December 2000, the rating of the Registered Notes was lowered to CCC-.
Based on recent trading information, the fair value of the Registered Notes is
approximately $11.3 million, as compared to a carrying value of $100.0 million.

    INITIAL CREDIT FACILITY

    In connection with the Offering and Combination, the Company obtained a
$75.0 million Credit Facility (as amended on August 18, 1999) from a bank (the
"Initial Credit Facility"). The Initial Credit Facility consisted of a
five-year, secured, fully amortizing $50.0 million term loan (the "Initial Term
Loan") and a three-year, secured $25.0 million revolving line of credit (the
"Initial Revolving Credit"). The balance outstanding under the Initial Credit
Facility was $64.1 million as of December 31, 1999 ($20.3 million under the
Initial Revolving Credit and $43.8 million under the Initial Term Loan). Amounts
outstanding under this facility were collateralized by substantially all of the
Company's assets.

    Interest was payable on the Initial Term Loan and the Initial Revolving
Credit at the base rate, as defined in the amended Initial Credit Facility. The
rate on the outstanding balance of the Revolver and the Initial Term Loan was
9.16% and 10.50%, respectively, as of December 31, 1999. The Initial Credit
Facility required the Company to make certain mandatory prepayments of amounts
outstanding under the Initial Credit Facility with the use of certain proceeds
from asset sales and debt and equity financing.

                                      F-17
<PAGE>
    The amended Initial Credit Facility required the Company to comply with
various affirmative and negative covenants, including the following, among
others:

    - the maintenance of certain financial ratios

    - restrictions on certain additional indebtedness

    - restrictions on liens, guarantees, dividends and the disposition of assets

    - obtaining the lenders' consent to acquisitions involving cash
      consideration in excess of a specified amount

    AMENDED TERM LOAN

    On March 30, 2000, the Company became a party to a Second Amended and
Restated Credit Agreement among the Company and First Union National Bank, N.A.
as agent and the lenders named therein (the "Amended Term Loan"). The Amended
Term Loan consisted of a two-year, secured $35.0 million term loan. The Company
paid commitment and other fees of approximately $0.9 million in connection with
obtaining the Amended Term Loan. Under the Amended Term Loan, the principal
amount of the term loan was reduced from $43.8 million to $35.0 million.

    The Amended Term Loan was secured by a lien on substantially all of the
Company's and its subsidiaries' tangible and intangible property. In addition,
the Amended Term Loan was jointly and severally guaranteed by all current and
future subsidiaries of the Company. Interest was payable on the Amended Term
Loan at a rate based on one of two customary interest rates plus an additional
interest margin of 375 or 500 basis points, as applicable.

    The Amended Term Loan contained customary events of default, including
cross-default provisions related to the Registered Notes.

    In connection with the Amended Term Loan, the Company issued to an affiliate
of First Union National Bank, N.A. detachable warrants to purchase up to 4.0% of
the Company's Common Stock on a diluted basis. The exercise price of the
warrants will be nominal, and the warrants will be exercisable at any time after
the second anniversary of the issuance of the warrants. The proceeds of the
Amended Term Loan were allocated between debt and warrants based on their
respective fair market values. The estimated fair value of the warrants appears
as a component of Additional Paid-In Capital in the accompanying Consolidated
Balance Sheet as of December 31, 2000.

    The letter of credit outstanding under the Initial Credit Facility was
replaced by a $1.1 million letter of credit issued for the account of RCPI,
which is an affiliate of MS Acquisition, the Company's largest shareholder. The
Company issued to RCPI a reimbursement note subordinated in right of payment to
the Registered Notes in the amount of the letter of credit. The promissory note
will become payable if the letter of credit is drawn.

    NEW REVOLVER

    On March 30, 2000, the Company also became a party to a Credit Agreement
among the Company, certain of its subsidiaries, and The Chase Manhattan Bank,
N.A. as agent and the lenders named therein (the "New Revolver," and together
with the Amended Term Loan, the "New Senior Credit Facility"). The New Revolver
consisted of a two-year, senior secured $50.0 million revolving line of credit,
subject to a borrowing base equal to a specified percentage of eligible
receivables. The Company paid commitment and other fees of approximately
$0.6 million in connection with obtaining the New Revolver. Funds advanced under
the New Revolver were used by the Company to repay a portion of outstanding
amounts under the Initial Credit Facility, to partially finance the acquisition
of Sales Force, to finance the Company's working capital and capital expenditure
requirements in the ordinary course of business, and to pay fees and expenses
relating to the closing of the New Senior

                                      F-18
<PAGE>
Credit Facility. The New Revolver contained customary events of default,
including cross-default provisions related to the Registered Notes.

    The New Revolver was secured by a first priority security interest in cash,
cash equivalents, accounts receivable and inventory of the Company and its
subsidiaries and proceeds thereof but not in assets that are the proceeds of
equipment, fixtures, real estate, intellectual property or the stock of
subsidiaries. In addition, Inman, Marketing Specialists Sales Company ("MSSC")
and Bromar, Inc. ("Bromar" a California corporation and a wholly owned
subsidiary of MSSC) were co-borrowers under the New Revolver, jointly and
severally liable for all borrowings and other related obligations thereunder.
Interest was payable on the New Revolver at a rate based on one of two customary
interest rates plus an additional interest margin ranging from 150 to 350 basis
points. The applicable margin was determined based on certain financial ratios
of the Company.

    The New Senior Credit Facility required the Company to comply with various
affirmative and negative covenants, including, among others:

    - the maintenance of certain financial ratios

    - restrictions on additional indebtedness

    - restrictions on liens, guarantees, dividends and the disposition of assets

    - restrictions on certain mergers, consolidations and acquisitions

    During 2000, the Company incurred approximately $5.3 million in costs
primarily related to the New Senior Credit Facility.

    FIRST UNION AMENDED CREDIT AGREEMENT

    On November 17, 2000, the Company became party to a First Amendment to the
Credit Agreement among the Company, certain of its subsidiaries as guarantors,
and First Union National Bank, N.A. as agent (the "First Union Amended Credit
Agreement"). The First Union Amended Credit Agreement amends the Amended Term
Loan and provides for the consent of First Union National Bank, N.A. to the
Increase (as defined below), the Borrowing Base Amendment (as discussed below),
and the repayment of the $2.5 million promissory note (as discussed below) to MS
Acquisition. The First Union Amended Credit Agreement also amends the Amended
Term Loan to reflect the terms of the Amended Credit Agreement. The Company was
in violation of certain covenants at December 31, 2000. See "Amended Senior
Credit Facility Amendments" discussion for more information.

    AMENDED CREDIT AGREEMENT

    On November 17, 2000, the Company became party to an amendment to the Credit
Agreement among the Company, certain of its subsidiaries, The Chase Manhattan
Bank, N.A. as the agent (the "Agent") and the lenders parties thereto (the
"Amended Credit Agreement"). The Amended Credit Agreement provides for an
increase in the maximum amount available under the New Revolver from
$50.0 million to a maximum commitment of $60.0 million (the "Increase"), which
is comprised of a $41.0 million variable commitment (the "Tranche A Note") and a
subordinated $19.0 million fixed commitment (the "Tranche B Note"). MS
Acquisition purchased a 100% participation interest in the Tranche B Note.

    The Tranche A Note provides for a $41.0 million revolving line of credit
(the "Amended Revolver"), which accrues interest at rate equal to the Base Rate
(a reference rate based on the prime rate, which equaled 9.5% at December 31,
2000) plus 2.25%. The Amended Revolver will revolve up to the lesser of
$41.0 million or the Borrowing Base, which is a function of the Company's
eligible receivables and the Advance Percent determined by the Agent. As part of
the Amended Credit

                                      F-19
<PAGE>
Agreement, the Agent has decreased the Advance Percent, thereby decreasing the
Borrowing Base (the "Borrowing Base Amendment"). The Company must fulfill all
payment obligations under the Amended Revolver before making any interest
payments on the Tranche B Note. The Tranche A Note and any accrued and unpaid
interest will mature on March 30, 2002. As of December 31, 2000, approximately
$29.9 million was outstanding and $0.9 million was available under the Amended
Revolver.

    The Tranche B Note bears interest at a rate equal to the Base Rate plus
2.25%. The Tranche B Note and any accrued and unpaid interest will mature on
March 30, 2002. The fixed commitment under the Tranche B Note is not subject to
the Borrowing Base. MS Acquisition funded the $19.0 million balance of the
Tranche B Note, subject to the terms of a master participation agreement. As of
December 31, 2000, $19.0 million was outstanding under the Tranche B Note. The
Company was in violation of certain covenants at December 31, 2000. See Note 20
for discussion of these violations and related amendments and waivers.

    AMENDED SENIOR CREDIT FACILITY AMENDMENTS

    As of March 30, 2001, the Company was in violation of certain covenants
under the Amended Credit Agreement and the First Union Amended Credit Agreement
(collectively referred as the "Amended Senior Credit Facility") in connection
with (i) its failure to provide annual financial statements within ninety (90)
days of its fiscal year end, (ii) the certifying accountant's qualification of
the Company's annual financial statements on a going concern basis, and
(iii) the Company's failure to deliver certain items to the Agent by March 15,
2001 as required by the Amended Credit Agreement. On April 19, 2001, the Company
entered into (a) a Waiver and Third Amendment to Credit Agreement amending the
Amended Credit Agreement and (b) Second Amendment to Credit Agreement amending
the First Union Amended Credit Agreement ((a) and (b) collectively defined as
the "Amended Senior Credit Facility Amendments").

    Under the Amended Senior Credit Facility Amendments, the Company
(i) received a waiver for its current defaults under the Amended Senior Credit
Facility and (ii) paid a fee of approximately $0.2 million as consideration in
obtaining the amendments and waiver of the defaults under the Amended Credit
Agreement. The Amended Senior Credit Facility Amendments provide, among other
things, that (i) the Agent may increase the Advance Percent as of March 31,
2001, but before June 1, 2001, thereby increasing the Borrowing Base under the
Amended Senior Credit Facility, (ii) amends the definition of "EBITDA" in the
Amended Senior Credit Facility to include certain write-offs in the amortization
and depreciation expense deducted in determining Net Income, and (iii) amends
the baseline amounts for determining Minimum EBITDA. Under the Amended Senior
Credit Facility Amendments, the Company must meet certain post-closing
covenants, including, among other things, the delivery of its annual financial
statements by April 27, 2001 and the delivery of certain other items by May 31,
2001.

    NOTES PAYABLE

    The notes payable amounts generally consist of the total estimated payments
to be made pursuant to acquisition agreements. The total estimated payments have
been discounted at rates ranging from 8% to 10%. The amounts due under the
acquisition agreements are unsecured and extend through 2011. These amounts are
payable in either monthly or quarterly installments.

    BANKS--MORTGAGE LOANS

    Certain of the Company's office space in Canton, Massachusetts is secured by
a mortgage with a real estate lender. It bears interest at 8.56%, requires
monthly payments of approximately $83,000 (including interest) and matures on
March 1, 2018. The balance outstanding under the mortgage note was approximately
$8.9 million as of December 31, 2000.

                                      F-20
<PAGE>
    OTHER NOTES PAYABLE INVOLVING RELATED PARTIES

    The Company also has a mortgage note with RCPI, an affiliate of MS
Acquisition Limited, that is secured by certain land, a building and fixtures.
It bears interest at 8.5% with monthly payments of approximately $34,000
(including interest) and a balloon payment of approximately $3.6 million due in
2001. The balance outstanding under this mortgage was approximately
$3.6 million as of December 31, 2000.

    On November 9, 2000, the Company issued a $2.5 million promissory note to MS
Acquisition. This promissory note is subordinate to the senior debt of the
Company. The proceeds were used for general corporate purposes. The
$2.5 million promissory note bears interest at a rate equal to the sum of an
interest margin of 2.75% plus the applicable prime rate on the last business day
of the quarter for which interest is payable. Interest is payable quarterly in
arrears, commencing on December 31, 2000, and will continue through the maturity
date. The $2.5 million promissory note and any unpaid and accrued interest will
be payable on November 9, 2002, or on demand, under specified conditions.

    The Company is not permitted to repay the principal and unpaid and accrued
interest on the $2.5 million promissory note on demand if the Company's
borrowing base 30 days prior to a payment date is not at least $10.0 million, or
25% of the sum of the Company's payroll for the last four consecutive pay
periods, whichever is greater. In the first quarter of 2001, the $2.5 million
promissory note was converted into redeemable convertible preferred stock. See
Note 20 for additional information.

    The Company had other notes payable to former employees of various acquired
entities of approximately $8.5 million as of December 31, 2000. The total
estimated payments have been discounted at rates ranging from 8% to 10%. The
amounts due under the acquisition agreements are unsecured and extend through
2011. These amounts are payable in either monthly or quarterly installments.

    CAPITAL LEASES

    The Company leases its office facilities and certain office equipment under
long-term capital lease agreements, which expire in various years through 2005.
Some of the Company's leases provide for escalating minimum rent. Rent expense
is recognized on a straight-line basis over the life of such lease.

    The annual future minimum lease payments under all noncancelable capital
leases, including leases for facilities that are no longer in use, as of
December 31, 2000, are as follows (amounts in thousands):

<TABLE>
<S>                                                           <C>
2001........................................................  $  409
2002........................................................     359
2003........................................................     105
2004........................................................     105
2005........................................................      45
Thereafter..................................................      --
                                                              ------
Total payments..............................................   1,023
Amount representing interest................................    (104)
                                                              ------
                                                                 919
Less--current portion.......................................    (357)
                                                              ------
                                                              $  562
                                                              ======
</TABLE>

    ACQUISITION RELATED DEFERRED COMPENSATION LIABILITIES

    In conjunction with acquisitions of other brokerage companies, deferred
compensation agreements are generally executed or assumed with the former owners
and certain key employees of the acquired

                                      F-21
<PAGE>
companies. Under these agreements, the Company agrees to pay certain amounts
upon either termination or retirement for such executive, or, in the event of
death, to their designated beneficiary. Terms vary; however, most payments are
monthly and continue for a period of up to ten years. The amounts to be paid
under most of these agreements are not based upon length of service but are a
fixed amount. The present value of these payments, discounted at rates ranging
from 7.5% to 10%, was capitalized as an intangible asset at the date of the
acquisition as a component of the purchase price.

    In connection with the Merger, the Company assumed RMSI's deferred
compensation liabilities, whereby RMSI agreed to pay certain employees a certain
sum monthly for ten years upon the earlier of their retirement, termination, or
death. Compensation and interest expense are accrued ratably over the employees'
expected service period such that the liability, at the anticipated vesting
date, equals the then present value of the future benefits. The deferred
compensation liabilities have been recorded at their net present value using
imputed interest rates ranging from 7.5% to 10%. Deferred compensation expense
for the years ended December 31, 2000 and 1999 was not material.

    The future aggregate minimum payments for deferred compensation liabilities
as of December 31, 2000 are as follows (amounts in thousands):

<TABLE>
<S>                                                           <C>
2001........................................................  $  6,045
2002........................................................     5,938
2003........................................................     5,778
2004........................................................     5,664
2005........................................................     5,497
Thereafter..................................................    21,868
                                                              --------
Total payments..............................................    50,790
Amount representing interest................................   (16,922)
                                                              --------
                                                                33,868
Less--current portion.......................................    (3,232)
                                                              --------
                                                              $ 30,636
                                                              ========
</TABLE>

    COVENANTS NOT TO COMPETE

    The Company is obligated to make payments under agreements with former
owners of acquired companies and various other individuals for consulting
services and covenants not to compete. The costs associated with such agreements
are recognized on a straight-line basis over the term of the consulting
services, which typically ranges from two to ten years.

    The future aggregate minimum payments under these agreements at
December 31, 2000 are as follows (amounts in thousands):

<TABLE>
<S>                                                           <C>
2001........................................................  $ 5,842
2002........................................................    4,374
2003........................................................    4,364
2004........................................................    4,232
2005........................................................    2,883
Thereafter..................................................    4,022
                                                              -------
Total payments..............................................   25,717
Amount representing interest................................   (5,649)
                                                              -------
                                                               20,068
Less--current portion.......................................   (4,331)
                                                              -------
                                                              $15,737
                                                              =======
</TABLE>

                                      F-22
<PAGE>
10. INCOME TAXES

    The Company's provision (benefit) for income taxes reconciles to the amount
computed by applying the federal statutory income tax rate to income before
income taxes as follows (amounts in thousands):

<TABLE>
<CAPTION>
                                                               YEAR ENDED
                                                              DECEMBER 31,
                                                          --------------------
                                                            2000        1999
                                                          ---------   --------
<S>                                                       <C>         <C>
Benefit at U.S. statutory rates.........................  $(127,663)  $(7,560)
State income tax, net of federal tax benefit............     (2,718)     (483)
Nondeductible amortization of intangibles...............     97,187     1,761
Nondeductible expenses..................................      1,207       839
Increase in valuation allowance on deferred tax
  assets................................................     32,174     5,443
Other...................................................       (187)       --
                                                          ---------   -------
    Income tax (benefit)................................  $      --   $    --
                                                          =========   =======
</TABLE>

    Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax reporting purposes. Significant
components of the Company's deferred tax assets are as follows (amounts in
thousands):

<TABLE>
<CAPTION>
                                                               DECEMBER 31,
                                                            -------------------
                                                              2000       1999
                                                            --------   --------
<S>                                                         <C>        <C>
Accrued severance and compensation........................       --      2,468
Accrued commissions.......................................      856      1,142
Allowance for doubtful accounts...........................    7,895      3,263
Accrued liabilities.......................................    2,363      2,287
Other.....................................................    1,571         --
                                                            -------    -------
    Total current deferred tax asset......................   12,685      9,160
Bonds repurchased.........................................    6,885         --
Net operating loss carryforwards..........................   23,624      7,432
Other carryforwards.......................................      395        296
Deferred compensation agreements..........................   10,469     11,938
Fixed assets..............................................   (1,136)      (513)
Intangible assets.........................................    8,750     (8,315)
Operating lease reserve...................................    2,788      3,295
Other.....................................................   (1,562)    (1,523)
                                                            -------    -------
    Total noncurrent deferred tax asset...................   50,213     12,610
                                                            -------    -------
Total deferred tax assets.................................   62,898     21,770
Valuation allowance.......................................  (62,898)   (21,770)
                                                            -------    -------
Total deferred tax assets, net of valuation allowance.....       --         --
                                                            =======    =======
</TABLE>

    The valuation allowance was increased during 2000 primarily due to
uncertainty concerning the realizability of such assets.

    At December 31, 2000, the Company had approximately $61.8 million in net
operating loss carryforwards available to offset future taxable income that
expire in varying amounts through 2020. Section 382 of the Internal Revenue Code
provides for a limitation on the annual utilization of net operating losses and
other losses when certain changes in ownership occur. The Company may have
experienced an ownership change as defined by Section 382 during 2000. The
Company will be required to compute the limitation, if necessary, prior to
utilizing any net operating loss carryforward or

                                      F-23
<PAGE>
any built-in loss. It is possible that the limitation could significantly limit
the Company's ability to fully utilize its built-in losses, net operating
losses, and related carryforwards.

    The Company has filed federal income tax refund claims challenging Internal
Revenue Service assessments previously paid. Management is unable to reasonably
ascertain the timing or amount of any potential refund resulting from these
claims. Accordingly, any benefit associated with these refund claims has not
been recorded.

11. EMPLOYEE BENEFIT PLANS

    The Company sponsors contributory plans for employees under the provisions
of Section 401(k) of the Internal Revenue Code (the "401(k) Plans"). Merkert
established the Merkert Advantage Plan, a 401(k) Plan, on January 1, 1997 to
provide a plan for contributions by employees. On July 1, 1999, the Merkert
401(k) was amended to become the 401(k) plan of the Company (the "Company 401(k)
Plan"). Rogers, Sell and UBC sponsored 401(k) Plans which on August 1, 1999 were
merged into the Company 401(k) Plan.

    RMSI sponsored a 401(k) savings plan for all employees who had been employed
by RMSI for at least one year. Effective on January 1, 2000, this plan was
merged into the Company 401(k) Plan.

    Eligible employees of the Company can make voluntary contributions to the
Company 401(k) Plan. Under the provisions of the Company 401(k) Plan, the
Company currently matches varying percentages of an eligible employee's
contribution up to certain limits of the employee's salary, as determined by the
Company.

    For the years ended December 31, 2000 and 1999, the Company's expense with
regard to the Company 401(k) Plan was approximately $4.1 million and
$2.0 million, respectively. The expense for the period ended December 31, 1998
was not material.

    The Company also sponsors a noncontributory Employee Stock Ownership Plan
("ESOP") available to former Merkert employees. The Company made no
contributions to the ESOP during 2000 or 1999.

12. RELATED PARTY TRANSACTIONS

    On April 27, 1999, Gerald R. Leonard, President, Chief Executive Officer and
Director of the Company, entered into an employment and noncompetition agreement
with the Company providing for a base salary, which is currently $455,000. The
term of employment is for five years and will continue from month to month
thereafter unless terminated by either party. If the Company terminates
Mr. Leonard's employment without cause, Mr. Leonard is entitled to receive his
then current base salary until expiration of the initial term or the extension
period. Mr. Leonard would also receive a continuation of group health and
automobile benefits during such time period. Pursuant to the agreement,
Mr. Leonard is subject to noncompetition and nonsolicitation provisions for one
year after the termination of his employment.

    In conjunction with a previous employment and noncompetition agreement by
and between the Company and Mr. Leonard (the "First Leonard Employment
Agreement"), Mr. Leonard executed a promissory note in favor of the Company for
$1.5 million (the "Leonard Note"). Pursuant to the terms of the Leonard Note,
Mr. Leonard purchased 300 shares of Common Stock, which stock was pledged to the
Company as security, pursuant to the terms of a stock pledge agreement between
the Company and Leonard (the "Leonard Pledge Agreement"). On July 7, 1998 and
January 11, 1999, the Company released 60 and 121,817 (after giving effect to
the share recapitalization in connection with the Company's initial public
offering) shares of Common Stock, respectively, from the pledge.

                                      F-24
<PAGE>
    On April 27, 1999, under the terms of the current employment, the Leonard
Note became due and payable on April 8, 2004 and certain shares of the Common
Stock were released from the pledge such that shares having a fair market value
of $1.5 million (as of January 11, 1999) would remain subject to the pledge.
After giving effect to the releases and share recapitalization, 98,361 shares of
Common Stock were pledged pursuant to the Leonard Pledge Agreement (the "Leonard
Pledged Shares"). The Company has now deemed it is in its best interests that it
should no longer issue promissory notes requiring a pledge of the Company's
Common Stock as security. Rather, the Company now achieves the same economic
benefits for its employees through the issuance of employee stock options to
purchase shares of Common Stock at a stated exercise price.

    To make the Leonard Note, Leonard Pledge Agreement, Leonard Pledged Shares
and related provisions of the First Leonard Employment Agreement consistent with
the Company's current practice, Mr. Leonard surrendered any and all rights and
obligations he had under the Leonard Note, Leonard Pledge Agreement, and Leonard
Pledged Shares in exchange for issuance of employee stock options pursuant to
which Leonard will have an option to purchase 98,361 shares of Common Stock at
an aggregate exercise price of $1.5 million, or $15.25 per share, all in
accordance with the Exchange Agreement entered into on February 12, 2001, by and
between the Company and Mr. Leonard (the "Exchange Agreement").

    See Note 6 for the sale of properties to related parties.

    The Company has unsecured long-term obligations to related parties of
approximately $44.7 million as of December 31, 2000. These obligations bear
interest at rates ranging from 6.00% to 10.125%. Principal and interest payments
are due under various arrangements over terms ranging from one to 13 years.

    A total of approximately $25.1 million of these obligations represents
amounts due to either MS Acquisition or an affiliate of MS Acquisition. As
discussed in Note 8, MS Acquisition funded the $19.0 million balance of the
Tranche B Chase Note, subject to the terms of a master participation agreement.

    As of December 31, 2000, the Company received $4.0 million in cash from MS
Acquisition for shares of the Series B Preferred Stock (as defined below) not
issued until 2001. See Note 20 for additional information. The impact of these
transactions appears in Other Liabilities in the accompanying consolidated
balance sheet as of December 31, 2000.

    During the year, the Company issued 11,811,701 shares of Common Stock to MS
Acquisition for an aggregate purchase price of $24.5 million. See Note 15 for
additional information. As of December 31, 2000, the Company has issued 12,397
shares of the Series B Preferred Stock (as defined below) to MS Acquisition,
which are still outstanding. See Note 14 for additional information.

    See Note 16 for option grants to related parties.

    See Note 20 for subsequent event transactions with related parties.

13. COMMITMENTS AND CONTINGENCIES

    PROMOTIONAL FUNDS

    Certain Manufacturers provide the Company with funds to be used solely for
advertising and other promotional activities. The Company had cash of
$0.9 million and $1.2 million as of December 31, 2000 and 1999, respectively,
which was restricted to payment for promotional activities on behalf of its
Manufacturers. The offsetting liability is included in Accrued Expenses in the
accompanying consolidated balance sheets at December 31, 2000 and 1999.

                                      F-25
<PAGE>
    OPERATING LEASES

    The Company leases certain office and warehouse facilities under operating
leases expiring on various dates through 2005. Many of leases contain escalation
clauses, which have been reflected in the corresponding years' rent expense.
During 1999 and 1998, the Company completed an assessment of its office
facilities requirements in an effort to streamline its operations and improve
its cost structure. In connection with this assessment, management approved a
plan to consolidate redundant offices that had resulted from prior business
acquisitions and to vacate the offices. The employees and related assets were
consolidated into other offices in the same geographic area. As a result, the
Company recorded a restructuring charge of approximately $13.3 million during
the third quarter of 1999 including approximately $8.6 million related to
noncancelable lease obligations on 29 abandoned facilities.

    Rental costs, including real estate taxes, were approximately $25.0 million
and $14.4 million for the years ended December 31, 2000 and 1999, respectively,
and $0.2 million for the period ended December 31, 1998.

    Estimated future minimum annual rental payments, exclusive of real estate
taxes, required under all operating leases (excluding those considered redundant
in the consolidation plan) that have initial or remaining noncancelable lease
terms in excess of one year are approximately $23.2 million for 2001;
$16.4 million for 2002; $12.5 million for 2003; $10.9 million for 2004; and
$10.7 for 2005.

    LEGAL PROCEEDINGS

    As reported in the Company's Current Report on Form 8-K dated July 6, 2000
and in the Company's Quarterly Report for the period ended June 30, 2000, a
lawsuit was filed on June 8, 2000 in the Delaware Court of Chancery by William
Brown, III, on behalf of the public stockholders, alleging that the offer price
made in the proposal by the majority stockholder, Richmont Capital Partners
I, L.P. ("RCPI"), to purchase all outstanding shares of the Company is
inadequate. The plaintiff class asserts that the Board of Directors has violated
its fiduciary duties to the Company stockholders, including the duty of fair
dealing. The plaintiff class seeks the enjoinder of the tender offer by RCPI or
the rescission of the contract if the offer is consummated and the awarding of
rescission damages. The suit has been consolidated with two other identical
suits. All parties have been served, but there has been secured an indefinite
extension to answer. Although discovery requests have been served by the
plaintiff class's counsel, a response will not be due until 30 days after an
agreement on the tender offer has been reached. No such agreement has currently
been reached.

    As reported in the Company's Current Report on Form 8-K dated July 6, 2000
and in the Company's Quarterly Report on Form 10-Q for the period ended
June 30, 2000, the Company entered into a Settlement Agreement and Mutual
Release (the "Settlement Agreement") with Monroe & Company, LLC ("Monroe LLC")
on June 13, 2000. Monroe LLC filed an action entitled MONROE & COMPANY, LLC V.
MARKETING SPECIALISTS CORPORATION, Civil Action No. 99-4745, in Middlesex
Superior Court, Commonwealth of Massachusetts, asserting, among other things,
that it was due advisory fees arising out of letter agreements. The terms of the
Settlement Agreement remain confidential.

    The Company is involved in various other legal proceedings that arise in the
ordinary course of business. Management believes that the outcome of such legal
proceedings will not have a material adverse impact on the Company's
consolidated financial position or results of operations.

14. REDEEMABLE CONVERTIBLE PREFERRED STOCK

    UNDESIGNATED PREFERRED STOCK

    As of December 31, 2000, there were no shares of undesignated preferred
stock outstanding. Holders of undesignated preferred stock would have priority
over the holders of Common Stock with

                                      F-26
<PAGE>
respect to dividends and to other distributions, including the distribution of
assets upon liquidation. The Board of Directors has the authority, without
stockholder authorization, to issue shares of undesignated preferred stock in
one or more series and to fix the terms, limitations, relative rights and
preferences and variations.

    PREFERRED STOCK

    On June 23, 2000, the Board of Directors of the Company authorized and
provided for the issuance of up to 10,000 shares of 8.0% Convertible
Paid-In-Kind Preferred Stock, par value $0.01 per share, with a stated value of
$1,000 per share (the "Preferred Stock"). Each share of the Preferred Stock is
convertible into that number of shares of Common Stock equal to the result
obtained by dividing the stated value of the Preferred Stock by the conversion
price in effect at the conversion date.

    All dividends on issued shares of the Preferred Stock are cumulative,
whether or not the dividends are earned or declared, on a daily basis from the
issue date and payable quarterly in arrears on each dividend payment date. Even
if not declared, all unpaid dividends will compound quarterly at an annual
dividend rate equal to 8.0%, or the applicable dividend rate.

    On June 22, 2010, the Company will be obligated to redeem, to the extend of
funds legally available, all outstanding shares of the Preferred Stock at a
redemption price equal to 100% of the liquidation preference per share. The
liquidation preference per share will be equal to the greater of $1,000 per
share or the amount that the equivalent number of shares of Common Stock (based
on the conversion rate applicable at the liquidation date) would be entitled to
receive, plus any unpaid dividends.

    On June 23, 2000, the Company issued 5,000 shares of Preferred Stock to MS
Acquisition for an aggregate purchase price of $5.0 million pursuant to the
terms of a preferred stock purchase agreement. On August 8, 2000, the Company
issued 4,500 additional shares of Preferred Stock to MS Acquisition for an
aggregate purchase price of $4.5 million pursuant to the terms of a preferred
stock purchase agreement.

    On July 27, 2000, the Company received early termination of the waiting
period in connection with its Hart-Scott-Rodino Antitrust Improvement Act filing
thereafter allowing the conversion of the Preferred Stock to Common Stock of the
Company. On August 21, 2000, the 9,500 shares of Preferred Stock previously
issued to MS Acquisition were converted into 6,234,414 shares of Common Stock.
Per the terms of the preferred stock purchase agreements, each share of
Preferred Stock was converted into approximately 656.25 shares of Common Stock
(i.e., the Preferred Stock's stated value of $1,000 divided by the conversion
price of $1.5238).

    On August 17, 2000, the Company issued a $4.75 million promissory note to MS
Acquisition. On August 30, 2000, the Company issued a $5.0 million promissory
note to MS Acquisition. The Registered Notes and the New Senior Credit Facility
are senior to these notes. The Company used the proceeds from both promissory
notes for general corporate purposes.

    SERIES B PREFERRED STOCK

    On November 1, 2000, the Company's Board of Directors authorized the
issuance of up to 20,000 shares of Series B 8.0% Convertible Paid-In-Kind
Preferred Stock, $0.01 par value per share (the "Series B Preferred Stock"). The
Series B Preferred Stock has a stated value of $1,000 per share. The Series B
Preferred Stock is of equal class with the Preferred Stock previously authorized
and any future designated series of preferred stock unless specifically noted in
future preferred stock agreements. The Series B Preferred Stock has the same
characteristics (i.e., dividend terms, conversion features) as the Preferred
Stock.

                                      F-27
<PAGE>
    On November 1, 2000, the Company issued 12,397 shares of Series B 8.0%
Convertible Paid-In-Kind Preferred Stock, $0.01 par value per share (the
"Series B Preferred Stock) to MS Acquisition for an aggregate purchase price of
approximately $12.4 million pursuant to the terms of a preferred stock purchase
agreement. The purchase price consisted of the cancellation of the
$4.75 million promissory note and the $5.0 million promissory note, including
all accrued and unpaid interest, plus an additional cash payment of
approximately $2.5 million to the Company. The incremental proceeds from the
issuance of the Series B Preferred Stock were used for general corporate
purposes.

    On November 9, 2000, the Company issued a $2.5 million promissory note to MS
Acquisition. This promissory note is subordinate to the senior debt of the
Company. The proceeds were used for general corporate purposes. The
$2.5 million promissory note bears interest at a rate equal to the sum of an
interest margin of 2.75% plus the applicable prime rate on the last business day
of the quarter for which interest is payable. Interest is payable quarterly in
arrears, commencing on December 31, 2000, and will continue through the maturity
date. The $2.5 million promissory note and any unpaid and accrued interest will
be payable on November 9, 2002, or on demand, under specified conditions. The
Company is not permitted to repay the principal and unpaid and accrued interest
on the $2.5 million promissory note on demand if the Company's borrowing base
30 days prior to a payment date is not at least $10.0 million, or 25% of the sum
of the Company's payroll for the last four consecutive pay periods, whichever is
greater. In the first quarter of 2001, the $2.5 million promissory note was
converted into redeemable convertible preferred stock. See Note 20 for
additional information.

15. STOCKHOLDERS' EQUITY

    Upon amendment and restatement of the Company's Certificate of
Incorporation, the Company's authorized capital stock consists of 54,000,000
shares of Common Stock, $0.01 par value per share, of which 4,000,000 are
designated as Restricted Common Stock and 1,000,000 shares of undesignated
preferred stock.

    The holders of Common Stock are entitled to one vote per share for each
share held of record on all matters to be voted on by stockholders. The holders
of restricted Common Stock are entitled to 1/10th of one vote for each share
held on all matters on which they are entitled to vote. Holders of restricted
Common Stock are entitled to vote on all matters on which the holders of Common
Stock are entitled to vote.

    Each share of restricted Common Stock will automatically convert into Common
Stock on a share for share basis upon a disposition of such shares of restricted
Common Stock which occurs after the later of the first day after the second
anniversary of the consummation of the Offering and the Combination and the
first day after the first election of Class II Directors occurring after the
consummation of the Offering and the Combination.

    In the event of any liquidation, dissolution or winding-up of the affairs of
the Company, holders of Common Stock will be entitled to share ratably in the
Company's remaining assets after the payment, or provision for payment, of all
of the Company's debts and obligations and after liquidation payments to holders
of the outstanding shares of undesignated preferred stock, if any.

    On January 7, 2000, the Company issued 1,577,287 shares of Common Stock to
MS Acquisition for an aggregate purchase price of $5.0 million ($3.17 per share)
pursuant to the terms of a stock purchase agreement. On March 30, 2000, MS
Acquisition purchased an additional 4,000,000 shares of Common Stock for an
aggregate purchase price of $10.0 million ($2.50 per share) pursuant to the
terms of a stock purchase agreement. The Company used the funds as an additional
source of capital for operations and additional short-term and long-term
liquidity. The offering, sale and issuance of these shares was exempt from
registration under the Securities Act of 1933, as amended, pursuant to a private
offering exemption under Section 4(2) promulgated thereunder.

                                      F-28
<PAGE>
    As indicated in Note 14, in 2000, the 9,500 outstanding shares of the
Preferred Stock held by MS Acquisition were converted into 6,234,414 shares of
Common Stock.

    As indicated in Note 9, $1.7 million of the Amended Term Loan value was
allocated to detachable warrants issued as part of the March 30, 2000
refinancing. The estimated fair value of the warrants at the issuance date
appears as a component of Additional Paid-In Capital in the accompanying
Consolidated Balance Sheet as of December 31, 2000.

16. STOCK OPTION PLAN

    The Company maintains the Merkert American Corporation 1998 Stock Option and
Incentive Plan (the "1998 Stock Plan", as amended). The 1998 Stock Plan provides
for the award of incentive stock options ("ISOs"), non-qualified stock options
("NQSOs"), stock appreciation rights, deferred stock awards, restricted and
unrestricted stock awards, performance share awards and dividend equivalent
rights to all directors and employees of and consultants to the Company. In
general, the terms of the awards granted are established by either the Board of
Directors or a committee established by the Board of Directors.

    OPTION REPRICING

    In January 2000, the Company granted options to purchase approximately
1,300,000 shares of Common Stock to certain board members, executives and key
employees under the 1998 Stock Plan, as amended. The options vest over 3 years
from the grant date and are exercisable at $3.00 per share, which exceeded the
quoted market price, over a period not to exceed ten years from the date of
original grant in the case of an incentive stock option (five years in the case
of an incentive stock option granted to the holder of more than 10% of the
combined voting power of all classes of the Company's capital stock on the date
of grant). Simultaneously, the Company (with the consent of the affected
individuals) cancelled options to purchase 1,217,107 shares of Common Stock at
exercise prices ranging from $3.00 to $15.00 per share. The newly issued stock
options will be treated as variable options for accounting purposes, and the
Company will record compensation expense over the vesting period to the extent
that the quoted market price of the Common Stock exceeds the option exercise
price.

    At the annual meeting of stockholders held in June 2000, the Company's
stockholders approved an increase of the maximum number of shares of Common
Stock available under the Company's 1998 Stock Plan, as amended, from 1,847,762
to 2,587,855. The Company had 298,663 options available for grant under the 1998
Stock Plan at December 31, 2000.

                                      F-29
<PAGE>
    Information with respect to all stock options is summarized below:

<TABLE>
<CAPTION>
                                                                                      WEIGHTED AVG.
                                                     ISOS      NQSOS       TOTAL      EXERCISE PRICE
                                                   --------   --------   ----------   --------------
<S>                                                <C>        <C>        <C>          <C>
OUTSTANDING AS OF MARCH 4, 1998..................        --         --           --           --
Granted..........................................   347,000    310,000      657,000       $13.60
Exercised........................................        --         --           --           --
Cancelled........................................        --         --           --           --
                                                   --------   --------   ----------       ------
OUTSTANDING AS OF DECEMBER 31, 1998..............   347,000    310,000      657,000       $13.60
Granted..........................................   547,069    437,937      985,006        12.68
Exercised........................................        --         --           --           --
Cancelled........................................  (162,859)   (67,938)    (230,797)       12.59
                                                   --------   --------   ----------       ------
OUTSTANDING AS OF DECEMBER 31, 1999..............   731,210    679,999    1,411,209       $13.12
Granted..........................................   847,866    507,131    1,354,997         3.00
Exercised........................................        --         --           --           --
Cancelled........................................  (699,976)  (517,131)  (1,217,107)       12.61
                                                   --------   --------   ----------       ------
OUTSTANDING AS OF DECEMBER 31, 2000..............   879,100    669,999    1,549,099       $ 4.67
                                                   ========   ========   ==========       ======
EXERCISABLE AS OF DECEMBER 31, 2000..............   307,043    213,707      520,750
                                                   ========   ========   ==========
</TABLE>

    The Company has adopted the disclosure-only provisions of SFAS 123. Had
compensation expense for the Company's 1998 Stock Plan been determined using the
fair value at the grant dates, the Company's pro forma net loss would have been
approximately ($368.5) million and ($24.0) million for the years ended
December 31, 2000 and 1999, respectively. Net loss available to common would
have been approximately ($368.7) million and ($23.1) million for the years ended
December 31, 2000 and 1999, respectively. Basic (and diluted) pro forma net loss
per share would have been approximately ($17.56) and ($2.32) for the years ended
December 31, 2000 and 1999, respectively. Pro forma compensation expense for
options granted is reflected over the vesting period; therefore, future
compensation expense may be greater as additional options are granted.

    The fair value of stock options granted was estimated on the date of grant
using the Black-Scholes option-pricing model. The weighted average fair value of
options granted was $2.55 and $3.11 per share during 2000 and 1999,
respectively, assuming the following parameters:

<TABLE>
<CAPTION>
                                                                2000       1999
                                                              --------   --------
<S>                                                           <C>        <C>
Expected volatility.........................................    99.2%      50.0%
Risk-free interest rates....................................    6.63%      6.15%
Expected term (years).......................................     7.0        7.0
Dividend yield..............................................      --         --
</TABLE>

                                      F-30
<PAGE>
17. EARNINGS PER SHARE

    The following table sets forth the computation of basic and diluted earnings
per share:

<TABLE>
<CAPTION>
                                                                          PERIOD
                                           YEARS ENDED DECEMBER 31,        ENDED
                                          --------------------------   DECEMBER 31,
                                              2000          1999           1998
                                          ------------   -----------   -------------
<S>                                       <C>            <C>           <C>
Numerator:
  Loss from continuing operations.......  $  (364,830)   $  (22,002)    $   (1,518)
                                          ===========    ==========     ==========
  Income (loss) from discontinued
    operations..........................  $      (638)   $      435     $       52
                                          ===========    ==========     ==========
  Net loss available to common*.........  $  (365,647)   $  (21,567)    $   (1,466)
                                          ===========    ==========     ==========
Denominator:
  Weighted average shares--basic........   20,998,381     9,973,759      1,891,000
  Dilutive stock options................           --            --             --
  Dilutive stock warrants...............           --            --             --
                                          -----------    ----------     ----------
  Weighted average shares--diluted......   20,998,381     9,973,759      1,891,000
                                          ===========    ==========     ==========
  Number of options excluded as they
    would be antidilutive...............    1,549,099     1,411,209        657,000
                                          ===========    ==========     ==========
  Number of warrants excluded as they
    would be antidilutive...............      687,136            --             --
                                          ===========    ==========     ==========
Per common share information--basic and
  diluted:
  Loss from continuing operations.......  $    (17.38)   $    (2.20)    $    (0.81)
                                          ===========    ==========     ==========
  Income (loss) from discontinued
    operations..........................  $     (0.03)   $     0.04     $     0.03
                                          ===========    ==========     ==========
  Net loss available to common..........  $    (17.41)   $    (2.16)    $    (0.78)
                                          ===========    ==========     ==========
</TABLE>

------------------------

(*) The 2000 amount represents the 2000 net loss less cumulative preferred
    dividends.

18. RESTRUCTURING AND OTHER NONRECURRING CHARGES

    RESTRUCTURING CHARGES RELATED FOR FORMER PERSONNEL

    In 1998, restructuring reserves of approximately $6.9 million were
established for severance prior to the Combination. As of December 31, 1999,
approximately $1.7 million of these reserves remained outstanding. Following the
Merger, a decision was made to eliminate redundant personnel and facilities
costs. This resulted in the recognition of a $13.3 million restructuring charge
in the third quarter of 1999. The charge consisted of approximately
$8.6 million relating to non-cancelable lease obligations on vacated facilities
and $4.7 million related to severance and other personnel amounts in connection
with the elimination of approximately 400 jobs.

    In 2000, the Company continued the integration of its business operations
and the centralization of its corporate headquarters. In the third quarter of
2000, the Company recognized an additional restructuring charge of approximately
$2.5 million, which consisted of severance and other termination benefits, in
connection with the termination of approximately 180 employees. Except for the
1998 charges, which were part of the operating results of Rogers and Merkert
prior to December 18, 1998, all charges appear as a reduction in the calculation
of the Company's income from continuing

                                      F-31
<PAGE>
operations. As of December 31, 2000, approximately $5.5 million of all
established restructuring reserves remained outstanding, and the Company expects
to complete these estimated obligations by the end of 2005. As the Company
continues its integration plans, additional restructuring charges may be
required.

    The estimated current portion of the restructuring reserves appears in
Accrued Expenses in the consolidated balance sheets as of December 2000 and
1999, and the noncurrent portion appears in Other Liabilities.

    NONRECURRING CHARGES RELATED TO TRADE RECEIVABLES

    During the third quarter of 2000, the Company provided additional reserves
for certain trade receivables related to the continuing integration of business
processes into its corporate headquarters and changed its estimate related to
the collectibility of its trade receivables outstanding in excess of 120 days.
Management's change in the estimated realizable value of its receivables
resulted in the recognition of approximately $19.5 million in nonrecurring
charges, which appear as a reduction in the calculation of the Company's income
from continuing operations.

    The provision for doubtful accounts for 2000 and 1999 was approximately
$13.3 million and $6.1 million, respectively.

19. UNAUDITED QUARTERLY RESULTS

    Summarize quarterly results for 2000 and 1999 are as follows (amounts in
thousands, except share and per share information):

<TABLE>
<CAPTION>
                                                        2000 QUARTER ENDED
                                           --------------------------------------------
                                           DEC. 31    SEP. 30(1)    JUN. 30    MAR. 31
                                           --------   -----------   --------   --------
<S>                                        <C>        <C>           <C>        <C>
Revenues.................................    97,372      89,563      99,451     94,444
Impairment loss..........................   306,953          --          --         --
Nonrecurring charges.....................        --      19,451          --         --
Restructuring charge.....................        --       2,520          --         --
Loss from continuing operations..........  (314,666)    (38,271)     (5,356)    (6,537)
Income (loss) from discontinued
  operations.............................    (1,623)        389         132        464
Net loss.................................  (316,289)    (37,882)     (5,224)    (6,073)
Net loss available to common.............  (316,468)    (37,882)     (5,224)    (6,073)
Net loss per share--basic and diluted....    (12.18)      (1.68)      (0.26)     (0.39)
</TABLE>

<TABLE>
<CAPTION>
                                                       1999 QUARTER ENDED
                                            -----------------------------------------
                                            DEC. 31    SEP. 30    JUN. 30    MAR. 31
                                            --------   --------   --------   --------
<S>                                         <C>        <C>        <C>        <C>
Revenues..................................   95,447     66,158     41,131     43,876
Restructuring charge......................       --     13,290         --         --
Income (loss) from continuing
  operations..............................   (3,180)   (17,331)    (3,059)     1,568
Income (loss) from discontinued
  operations..............................     (215)       241        145        264
Net income (loss).........................   (3,395)   (17,090)    (2,914)     1,832
Net loss per share--basic and diluted.....    (0.24)     (1.61)     (0.39)      0.25
</TABLE>

------------------------

(1) The measurement date of the discontinued Private Label operations was
    November 30, 2000. The amounts in this table have been updated to reflect
    the results of discontinued operations for all periods presented.

                                      F-32
<PAGE>
20. SUBSEQUENT EVENTS

    DISCONTINUED PRIVATE LABEL OPERATIONS

    On July 31, 2000, the Company signed a letter of intent to sell its Private
Label operations, known as Buy Sell, to Woodland Partners. On January 19, 2001,
the Company completed the sale of Buy Sell to Woodland Partners. For reporting
purposes, Buy Sell qualified as a segment, as it represented a separate major
line of business for the Company. For purposes of calculating the loss from
discontinued operations, the measurement date was November 30, 2000, and the
disposal date was January 19, 2001.

    The estimated ($0.6) million loss from the discontinued operations (as
reported in the consolidated statement of operations for the year ended
December 31, 2000) includes approximately $40.0 million of Buy Sell revenues for
2000 and no revenues for 2001. It includes a ($0.2) million provision for losses
incurred, net of applicable taxes, during the phaseout period. Total estimated
net assets transferred to Woodland Partners were approximately $1.7 million,
which included approximately $1.8 million in trade receivables, $0.8 million in
inventory and other current assets, and ($0.9) million in current liabilities.
Accrued expenses in the consolidated balance sheet as of December 31, 2000,
includes approximately $1.7 million of accrued losses related to Buy Sell
activity that occurred after December 31, 2000.

    REMOVAL FROM NASDAQ SMALL CAP ISSUES LISTING

    Effective March 14, 2001, the Company's Common Stock will no longer be
listed on the Nasdaq SmallCap Market. The Company is eligible for trading on the
OTC Bulletin Board.

    ISSUANCE OF SERIES B PREFERRED STOCK

    On January 26, 2001, the Company issued 7,568 shares of the Series B
Preferred Stock to MS Acquisition for an aggregate purchase price of
approximately $7.6 million pursuant to the terms of a preferred stock purchase
agreement. The purchase price consisted of the cancellation of the $2.5 million
promissory note and, including all accrued and unpaid interest, plus an
additional cash payment of approximately $5.0 million to the Company. A total of
$4.0 million of the cash proceeds were received in December 2000 and appeared as
a component of Other Liabilities in the consolidated balance sheet as of
December 31, 2000. The incremental proceeds from the issuance of the Series B
Preferred Stock were used for general corporate purposes.

    AUTHORIZATION AND ISSUANCE OF SERIES C PREFERRED STOCK

    On March 26, 2001, the Company's Board of Directors authorized the issuance
of up to 20,000 shares of Series C 8.0% Convertible Paid-In-Kind Preferred
Stock, $0.01 par value per share (the "Series C Preferred Stock"). The Series C
Preferred Stock has a stated value of $1,000 per share. The Series C Preferred
Stock is of equal class with the Preferred Stock and the Series B Preferred
Stock previously authorized and any future designated series of preferred stock
unless specifically noted in future preferred stock agreements.

    Each share of the Series C Preferred Stock is convertible into that number
of shares of Common Stock equal to the result obtained by dividing the stated
value of the Series C Preferred Stock by the conversion price in effect at the
conversion date.

    All dividends on issued shares of the Series C Preferred Stock are
cumulative, whether or not the dividends are earned or declared, on a daily
basis from the issue date and payable quarterly in arrears on each dividend
payment date. Even if not declared, all unpaid dividends will compound quarterly
at an annual dividend rate equal to 8.0%, or the applicable dividend rate.

                                      F-33
<PAGE>
    On June 22, 2010, the Company will be obligated to redeem, to the extend of
funds legally available, all outstanding shares of the Series C Preferred Stock
at a redemption price equal to 100% of the liquidation preference per share. The
liquidation preference per share will be equal to the greater of $1,000 per
share or the amount that the equivalent number of shares of Common Stock (based
on the conversion rate applicable at the liquidation date) would be entitled to
receive, plus any unpaid dividends.

    On March 28, 2001, the Company issued 9,000 shares of the Series C Preferred
Stock to MS Acquisition for an aggregate purchase price of $9.0 million in cash
pursuant to the terms of a preferred stock purchase agreement. The proceeds from
the issuance of the Series C Preferred Stock were used for general corporate
purposes.

    On March 30, 2001, the Company issued 2,000 shares of the Series C Preferred
Stock to MS Acquisition for an aggregate purchase price of $2.0 million in cash
pursuant to the terms of a preferred stock purchase agreement. The proceeds from
the issuance of the Series C Preferred Stock were used for general corporate
purposes.

                                      F-34
<PAGE>
                               INDEX TO EXHIBITS

    The following is a list of exhibits filed or incorporated by reference as a
part of this Annual Report on Form 10-K:

<TABLE>
<CAPTION>
     EXHIBIT NO.                                DESCRIPTION
---------------------   ------------------------------------------------------------
<C>                     <S>
        2.1             Amendment No. 1, dated July 8, 1999, to the Agreement and
                        Plan of Merger, dated as of April 28, 1999, between Merkert
                        American Corporation and Richmont Marketing
                        Specialists Inc., attached as Annex A to Merkert American
                        Corporation's Proxy Statement dated July 12, 1999 and
                        incorporated herein by reference.

        2.2             Agreement and Plan of Merger, dated as of April 28, 1999,
                        between Merkert American Corporation and Richmont Marketing
                        Specialists Inc., incorporated by reference to Exhibit 2.1
                        to Merkert American Corporation's Current Report on
                        Form 8-K dated April 30, 1999.

        3.1             Second Amended and Restated Certificate of Incorporation of
                        Merkert American Corporation, incorporated by reference to
                        Exhibit 3.1 to Merkert American Corporation's Amendment No.
                        7 to Registration Statement on Form S-1 filed December 15,
                        1998 (No. 333-53419).

        3.2             Certificate of Amendment to the Second Amended and Restated
                        Certificate of Incorporation of Merkert American
                        Corporation, dated August 18, 1999, incorporated by
                        reference to Exhibit 4.2 of the Company's Current Report on
                        Form 8-K dated September 2, 1999.

        3.3             Amended and Restated By-laws of Merkert American
                        Corporation, incorporated by reference to Exhibit 3.2 of the
                        Company's Annual Report on Form 10-K dated March 31, 1999.

        4.1             Indenture, dated as of December 19, 1997, among Richmont
                        Marketing Specialists Inc. and Texas Commerce Bank National
                        Association, as Trustee, incorporated by reference to
                        Exhibit 4.1 of Richmont Marketing Specialists Inc.
                        Registration Statement on Form S-4 dated June 16, 1999.

        4.2             First Supplemental Indenture, dated as of August 18, 1999,
                        among the Company, Merkert American Co., Inc., United
                        Brokerage Company, Buckeye Sales & Marketing, Inc.,
                        Marketing Specialists Sales Company, Bromar, Inc., Brokerage
                        Services, Inc., Atlas Marketing Company, Inc., Meatmaster
                        Brokerage, Inc., and Chase Bank of Texas, National
                        Association, incorporated by reference to Exhibit 4.3 to the
                        Quarterly Report on Form 10-Q dated September 30, 1999.

        4.3             Second Supplemental Indenture, dated as of October 13, 1999,
                        among the Company, its subsidiaries and Chase Bank of Texas,
                        National Association, incorporated by reference to
                        Exhibit 4.3 to the Company's Annual Report on Form 10-K
                        filed April 15, 2000.

        4.4             Third Supplemental Indenture, dated as of March 30, 2000,
                        among the Company, certain Guarantor Subsidiaries and Chase
                        Bank of Texas, National Association, incorporated by
                        reference to Exhibit 4.4 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

        4.5             Certificate of Merger, dated August 18, 1999, incorporated
                        by reference to Exhibit 4.1 to the Company's Current Report
                        on Form 8-K dated September 2, 1999.

        4.6             Specimen Certificate for shares of Common Stock of the
                        Company, incorporated by reference to Exhibit 4.1 to the
                        Company's Amendment No. 6 to Registration Statement on
                        Form S-1 dated November 19, 1998 (No. 333-53419).
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
     EXHIBIT NO.                                DESCRIPTION
---------------------   ------------------------------------------------------------
<C>                     <S>
       10.1             Warrant Agreement, dated as of March 30, 2000, among the
                        Company and First Union Investors, Inc., incorporated by
                        reference to Exhibit 10.3 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

       10.2             Registration Rights Agreement, dated as of March 30, 2000,
                        by and between the Company and First Union Investors, Inc.,
                        incorporated by reference to Exhibit 10.4 to the Company's
                        Annual Report on Form 10-K filed April 15, 2000.

       10.3             Stockholders Agreement, dated as of March 30, 2000, by and
                        among the Company, First Union Investors, Inc., MS
                        Acquisition Limited and Richmont Capital Partners I, L.P.,
                        incorporated by reference to Exhibit 10.5 to the Company's
                        Annual Report on Form 10-K filed April 15, 2000.

       10.4             Credit Agreement, dated March 30, 2000, among the Company
                        and certain of its subsidiaries, as Borrowers, Chase
                        Manhattan Bank, as agent, and the banks named therein,
                        incorporated by reference to Exhibit 10.6 to the Company's
                        Annual Report on Form 10-K filed April 15, 2000.

       10.5             Second Amended and Restated Credit Agreement, dated
                        March 30, 2000, among First Union National Bank, for itself
                        and as agent, the other Lenders described therein and the
                        Company and the Guarantors described therein, incorporated
                        by reference to Exhibit 10.7 to the Company's Annual Report
                        on Form 10-K filed April 15, 2000.

       10.6             Second Amended and Restated Security Agreement, dated
                        March 30, 2000, by and among the Company and its
                        subsidiaries, in favor of First Union National Bank, as
                        agent, incorporated by reference to Exhibit 10.8 to the
                        Company's Annual Report on Form 10-K filed April 15, 2000.

       10.7             Second Amended and Restated Pledge Agreement, dated
                        March 30, 2000, by and among the Company and its
                        subsidiaries, in favor of First Union National Bank, as
                        agent, incorporated by reference to Exhibit 10.9 to the
                        Company's Annual Report on Form 10-K filed April 15, 2000.

       10.8             Second Amended and Restated Guaranty Agreement, dated
                        March 30, 2000, by and among Marketing Specialists Sales
                        Company, Bromar, Inc., and Paul Inman Associates, Inc., in
                        favor of First Union National Bank, incorporated by
                        reference to Exhibit 10.10 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

       10.9             First Amendment to Credit Agreement, dated April 13, 2000,
                        among the Company, Marketing Specialists Sales Company, Paul
                        Inman Associates, Inc., Bromar, Inc. and The Chase Manhattan
                        Bank, incorporated by reference to Exhibit 10.2 to the
                        Company's Quarterly Report on Form 10-Q filed August 14,
                        2000.

       10.10            Joinder Agreement, dated April 14, 2000, by The Sales Force
                        Companies, Inc., the Company, Marketing Specialists Sales
                        Company, Paul Inman Associates, Inc., Bromar, Inc. and The
                        Chase Manhattan Bank, incorporated by reference to
                        Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q
                        filed August 14, 2000.

       10.11            Intercreditor Agreement, dated March 30, 2000, between and
                        among the Company, Paul Inman Associates, Inc., Marketing
                        Specialists Sales Company, and Bromar, Inc., as Debtors, and
                        The Chase Manhattan Bank and First Union National Bank, as
                        Agents, incorporated by reference to Exhibit 10.4 to the
                        Company's Quarterly Report on Form 10-Q filed August 14,
                        2000.

       10.12            Guaranty Agreement, dated March 30, 2000, of Richmont
                        Capital Partners I, L.P., incorporated by reference to
                        Exhibit 10.5 to the Company's Quarterly Report on Form 10-Q
                        filed August 14, 2000.
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
     EXHIBIT NO.                                DESCRIPTION
---------------------   ------------------------------------------------------------
<C>                     <S>
       10.13            Security Agreement, dated March 30, 2000, by and among the
                        Company, Marketing Specialists Sales Company, Paul Inman
                        Associates, Inc., and Bromar, Inc., and The Chase Manhattan
                        Bank, incorporated by reference to Exhibit 10.6 to the
                        Company's Quarterly Report on Form 10-Q filed August 14,
                        2000.

       10.14            Promissory Note, dated March 30, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales
                        Company, and Bromar, Inc. issued to The Chase Manhattan
                        Bank, incorporated by reference to Exhibit 10.7 to the
                        Company's Quarterly Report on Form 10-Q filed August 14,
                        2000.

       10.15            Promissory Note, dated April 14, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales
                        Company, Bromar, Inc., and The Sales Force Companies, Inc.
                        issued to The Chase Manhattan Bank, incorporated by
                        reference to Exhibit 10.8 to the Company's Quarterly Report
                        on Form 10-Q filed August 14, 2000.

       10.16            Promissory Note, dated March 30, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales
                        Company, and Bromar, Inc. issued to Credit Suisse/First
                        Boston, incorporated by reference to Exhibit 10.9 to the
                        Company's Quarterly Report on Form 10-Q filed August 14,
                        2000.

       10.17            Promissory Note, dated April 14, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales
                        Company, Bromar, Inc., and The Sales Force Companies, Inc.
                        issued to Credit Suisse/First Boston, incorporated by
                        reference to Exhibit 10.10 to the Company's Quarterly Report
                        on Form 10-Q filed August 14, 2000.

       10.18            Promissory Note, dated March 30, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales
                        Company, and Bromar, Inc. issued to Fleet Capital Bank,
                        incorporated by reference to Exhibit 10.11 to the Company's
                        Quarterly Report on Form 10-Q filed August 14, 2000.

       10.19            Promissory Note, dated April 14, 2000, of the Company, Paul
                        Inman Associates, Inc., Marketing Specialists Sales
                        Company, Bromar, Inc., and The Sales Force Companies, Inc.
                        issued to Fleet Capital Bank, incorporated by reference to
                        Exhibit 10.12 to the Company's Quarterly Report on
                        Form 10-Q filed August 14, 2000.

       10.20            Second Amended and Restated Term Note, as amended and
                        restated March 30, 2000, of the Company issued to First
                        Union National Bank, incorporated by reference to
                        Exhibit 10.14 to the Company's Quarterly Report on
                        Form 10-Q filed August 14, 2000.

       10.21            Promissory Note, dated August 17, 2000, of the Company
                        issued to Richmont Capital Partners I, L.P. in the principal
                        amount of $4,750,000, incorporated by reference to
                        Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q
                        filed November 21, 2000.

       10.22            Promissory Note, dated August 30, 2000, of the Company
                        issued to Richmont Capital Partners I, L.P. in the principal
                        amount of $4,999,999, incorporated by reference to
                        Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q
                        filed November 21, 2000.

       10.23            Deposit Security Agreement, dated as of October 5, 2000, by
                        and between MS Acquisition Limited, a Delaware limited
                        partnership, and The Chase Manhattan Bank, as agent for the
                        Banks (as defined therein) in connection with the pledge by
                        MS Acquisition Limited of cash and cash equivalents to
                        increase the Company's borrowing availability, incorporated
                        by reference to Exhibit 10.3 to the Company's Quarterly
                        Report on Form 10-Q filed November 21, 2000.

       10.24            Promissory Note, dated November 8, 2000, of the Company
                        issued to Richmont Capital Partners I, L.P. in the principal
                        amount of $2,500,000, incorporated by reference to
                        Exhibit 10.5 to the Company's Quarterly Report on Form 10-Q
                        filed November 21, 2000.
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
     EXHIBIT NO.                                DESCRIPTION
---------------------   ------------------------------------------------------------
<C>                     <S>
       10.25            First Amendment to Credit Agreement, dated November 17,
                        2000, by and among the Company, certain lenders described
                        therein, and First Union National Bank, as Agent and as sole
                        Lender, incorporated by reference to Exhibit 10.6 to the
                        Company's Quarterly Report on Form 10-Q filed November 21,
                        2000.

       10.26            Amended and Restated Intercreditor Agreement, dated
                        November 17, 2000, between and among the Company, certain of
                        its subsidiaries, The Chase Manhattan Bank, as agent for the
                        Revolver Lenders (as defined therein), First Union National
                        Bank, as agent for the Term Lenders (as defined therein), MS
                        Acquisition Limited, and Richmont Capital
                        Partners I, L.P., incorporated by reference to Exhibit 10.7
                        to the Company's Quarterly Report on Form 10-Q filed
                        November 21, 2000.

       10.27            Second Amendment to Credit Agreement dated November 17,
                        2000, among the Company, Marketing Specialists Sales
                        Company, Paul Inman Associates, Inc., and The Sales Force
                        Companies, Inc., certain banks or other lending institutions
                        named therein, and The Chase Manhattan Bank, individually as
                        a bank and as agent for itself and the other banks or
                        lending institutions named therein, incorporated by
                        reference to Exhibit 10.8 to the Company's Quarterly Report
                        on Form 10-Q filed November 21, 2000.

       10.28            Master Participation Agreement, dated November 17, 2000, by
                        and among MS Acquisition Limited and various banks or other
                        lending institutions named therein, incorporated by
                        reference to Exhibit 10.9 to the Company's Quarterly Report
                        on Form 10-Q filed November 21, 2000.

       10.29            Common Stock Purchase Agreement, dated as of January 7,
                        2000, by and between the Company and MS Acquisition Limited,
                        incorporated by reference to Exhibit 10.1 to the Company's
                        Annual Report on Form 10-K filed April 15, 2000.

       10.30            Common Stock Purchase Agreement, dated as of March 30, 2000,
                        by and between the Company and MS Acquisition Limited,
                        incorporated by reference to Exhibit 10.2 to the Company's
                        Annual Report on Form 10-K filed April 15, 2000.

       10.31            Stock Purchase Agreement, dated March 2, 2000, by and among
                        Marketing Specialists Sales Company, as Buyer, The Sales
                        Force Companies, Inc., as the Seller, and the Stockholders
                        of the Company, incorporated by reference to Exhibit 10.11
                        to the Company's Annual Report on Form 10-K filed April 15,
                        2000.

       10.32            Asset Purchase Agreement, dated as of November 18, 1999, by
                        and among Marketing Specialists Sales Company and
                        Johnson-Lieber, Inc., as amended by that certain First
                        Amendment to Asset Purchase Agreement dated as of
                        January 27, 2000, incorporated by reference to
                        Exhibit 10.16 to the Company's Annual Report on Form 10-K
                        filed April 15, 2000.

       10.33            Stock Purchase Agreement, dated July 7, 1999, by and among
                        Merkert American Corporation, as Buyer, Buckeye Sales &
                        Marketing, Inc., d/b/a The Sell Group-Cleveland, as the
                        Company, JF & JF Limited Partnership, as the Stockholder of
                        the Company, and the Primary Parties, incorporated by
                        reference to Exhibit 10.17 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

       10.34            Stock Purchase Agreement, dated as of May 14, 1999, by and
                        among Richmont Marketing Specialists Inc., Paul Inman
                        Associates, Inc. and the Shareholders of Paul Inman
                        Associates, Inc., as amended by that certain First
                        Amendment to Stock Purchase Agreement dated as of
                        August 13, 1999 and that certain Second Amendment to Stock
                        Purchase Agreement dated as of August 18, 1999, incorporated
                        by reference to Exhibit 10.18 to the Company's Annual Report
                        on Form 10-K filed April 15, 2000.
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
     EXHIBIT NO.                                DESCRIPTION
---------------------   ------------------------------------------------------------
<C>                     <S>
       10.35            Stock Purchase Agreement, dated April 26, 1999, by and among
                        Merkert American Corporation, as Buyer, United Brokerage
                        Company d/b/a The Sell Group-Grand Rapids, Toledo, Detroit,
                        Indianapolis and Fort Wayne, as the Company, and the
                        Stockholders of the Company, incorporated by reference to
                        Exhibit 10.19 to the Company's Annual Report on Form 10-K
                        filed April 15, 2000.

       10.36            Stock Purchase Agreement, dated January 20, 1999, among
                        Merkert American Corporation, Sell, Inc. and the
                        stockholders of Sell, Inc., incorporated by reference to
                        Exhibit 10.36 to the Company's Annual Report on Form 10-K
                        dated March 31, 1999.

       10.37            Stock Purchase Agreement, closing date April 14, 2000, by
                        and among Marketing Specialists Sales Company, as Buyer, The
                        Sales Force Companies, Inc., as the Seller, and the
                        Stockholders of the Company, incorporated by reference to
                        Exhibit 10.18 to the Company's Quarterly Report on
                        Form 10-Q filed August 14, 2000.

       10.38            Management Agreement, dated as of June 30, 2000, by and
                        among Marketing Specialists Sales Company, Mancini &
                        Groesbeck, Inc., Mancini & Groesbeck, Inc. Montana, Tad
                        Mancini and Chris Mancini, incorporated by reference to
                        Exhibit 10.19 to the Company's Quarterly Report on
                        Form 10-Q filed August 14, 2000.

       10.39            Preferred Stock Purchase Agreement, dated June 23, 2000, by
                        and between the Company and MS Acquisition Limited in
                        connection with the sale by the Company of 5,000 shares of
                        convertible paid-in-kind preferred stock, incorporated by
                        reference to Exhibit 10.20 to the Company's Quarterly Report
                        on Form 10-Q filed August 14, 2000.

       10.40            Preferred Stock Purchase Agreement, dated August 8, 2000, by
                        and between the Company and MS Acquisition Limited in
                        connection with the sale by the Company of 4,500 shares of
                        convertible paid-in-kind preferred stock, incorporated by
                        reference to Exhibit 10.21 to the Company's Quarterly Report
                        on Form 10-Q filed August 14, 2000.

       10.41            Preferred Stock Purchase Agreement, dated November 1, 2000,
                        by and between the Company and MS Acquisition Limited in
                        connection with the issuance by the Company of 12,397 shares
                        of Series B Convertible Paid-In-Kind Preferred Stock,
                        incorporated by reference to Exhibit 10.4 to the Company's
                        Quarterly Report on Form 10-Q filed November 21, 2000.

       10.42            Registration Rights Agreement, dated as of August 18, 1999,
                        by and among Merkert American Corporation, Gerald R.
                        Leonard, Monroe & Company, LLC, JLM Management, LLC, Robert
                        Doehler, Joseph T. Casey, Edward P. Grace, III, James
                        Philopkosky, Sandra Monroe, Sean P. Spaulding and Jo-Anne
                        Collins incorporated by reference to Exhibit 10.8 to the
                        Quarterly Report on Form 10-Q dated November 15, 1999.

       10.43            Post-Merger Voting Agreement, dated as of August 18, 1999,
                        by and among MS Acquisition Limited, Ronald D. Pedersen,
                        Bruce A. Butler, Gary R. Guffey, Jeffery A. Watt, Monroe &
                        Company, LLC and JLM Management Company, LLC incorporated by
                        reference to Exhibit 10.9 to the Quarterly Report on
                        Form 10-Q dated November 15, 1999.

       10.44            Advisory Agreement, dated as of August 18, 1999, by and
                        among the Company, Monroe & Company, LLC and Richmont
                        Capital Partners I, L.P. incorporated by reference to
                        Exhibit 10.10 to the Quarterly Report on Form 10-Q dated
                        November 15, 1999.

       10.45*           Asset Purchase and Sale Agreement for the acquisition of
                        substantially all of the assets of the Dorann Foods, Merco
                        Packaging, Merco Price Marking, and Merkert Laboratories
                        Divisions of the Company and Marketing Specialists Sales
                        Company by Woodland Partners, LLC, dated as of January 19,
                        2001. (filed herewith)
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
     EXHIBIT NO.                                DESCRIPTION
---------------------   ------------------------------------------------------------
<C>                     <S>
       10.46*           Memorandum of Agreement by and among the Company, William F.
                        Lee on behalf of the former stockholders of The Sales Force
                        Companies, Inc. ("Sales Force") other than the Employee
                        Stock Ownership Trust established by Sales Force ("ESOT")
                        and the ESOT dated December 28, 2000. (filed herewith)

       10.47*           Preferred Stock Purchase Agreement, dated January 26, 2001,
                        by and between the Company and MS Acquisition Limited in
                        connection with the sale by the Company of 7,568 shares of
                        convertible paid-in-kind preferred stock. (filed herewith)

       10.48*           Preferred Stock Purchase Agreement, dated March 28, 2001, by
                        and between the Company and MS Acquisition Limited in
                        connection with the sale by the Company of 9,000 shares of
                        convertible paid-in-kind preferred stock. (filed herewith)

       10.49*           Exchange Agreement, dated as of February 12, 2001, by and
                        between the Company and Gerald R. Leonard. (filed herewith)

       10.50            Contract of Sale of Improved Property, dated February 17,
                        2000, by and between Bromar, Inc. and RCPI Office
                        Properties, LLC ("Arizona Property"), incorporated by
                        reference to Exhibit 10.12 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

       10.51            Lease, dated February 17, 2000, between RCPI Office
                        Properties, LLC and Marketing Specialists Sales Company
                        ("Arizona Property"), incorporated by reference to
                        Exhibit 10.13 to the Company's Annual Report on Form 10-K
                        filed April 15, 2000.

       10.52            Contract of Sale of Improved Property, dated February 17,
                        2000, by and between Bromar, Inc. and RCPI Office
                        Properties, LLC ("California Property"), incorporated by
                        reference to Exhibit 10.14 to the Company's Annual Report on
                        Form 10-K filed April 15, 2000.

       10.53*           Agreement for Purchase and Sale of Real Property, dated
                        December 15, 2000, by and between Steve Farnic and Marketing
                        Specialists Sales Company, for the sale of 4.851 acres in
                        Mecklenberg, County, North Carolina. (filed herewith)

       10.54*           Lease, dated May 15, 2000, between LaSalle Company, LLC and
                        Marketing Specialists Sales Company for the Arizona
                        Property. (filed herewith)

       10.55*           Lease, dated May 2, 2000, between IPT Partners, LLC and
                        Marketing Specialists Sales Company for the California
                        Property. (filed herewith)

       10.56            Employment Agreement, dated April 2, 1996, between Marketing
                        Specialists Sales Company and Ronald D. Pedersen,
                        incorporated by reference to Exhibit 10.8 of Richmont
                        Marketing Specialists Inc. Registration Statement on
                        Form S-4 dated June 16, 1999.

       10.57            Employment Agreement, dated April 2, 1996, between Marketing
                        Specialists Sales Company and Bruce A. Butler, incorporated
                        by reference to Exhibit 10.9 of Richmont Marketing
                        Specialists Inc. Registration Statement on Form S-4 dated
                        June 16, 1999.

       10.58*           Amendment to Employment Agreement, dated January 8, 2001,
                        between the Company and Ronald D. Pedersen. (filed herewith)

       10.59*           First Amendment to Employment and Noncompetition Agreement,
                        dated February 9, 2001, between the Company and Glenn F.
                        Gillam. (filed herewith)

       10.60            First Amendment to Amended and Restated Merkert American
                        Corporation 1998 Stock Option and Incentive Plan,
                        incorporated by reference to Exhibit 10.5 to the Company's
                        Current Report on Form 8-K dated September 2, 1999.

       10.61            Amendment to the Company's 1998 Stock Option Plan, filed as
                        Appendix A to the Company's Definitive Proxy Statement filed
                        June 16, 2000.
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
     EXHIBIT NO.                                DESCRIPTION
---------------------   ------------------------------------------------------------
<C>                     <S>
       10.62*           Waiver and Third Amendment to Credit Agreement, dated as of
                        March 30, 2001, among the Company, certain of its
                        subsidiaries, the Agent (named therein) and the lenders
                        parties thereto. (filed herewith)

       10.63*           Second Amendment to Credit Agreement, made as of April 19,
                        2001, by and among the Company and First Union National
                        Bank, as Agent and sole Lender. (filed herewith)

       21.1*            Subsidiaries of the Company.

      23*               Consent of PricewaterhouseCoopers LLP. (included in Report
                        of Independent Accountants).

      24*               Power of Attorney (included on signature page of this
                        Form 10-K).

      25*               Consent of Arthur Andersen LLP.
</TABLE>

------------------------

*   Indicates that document is filed herewith.