DATE: Friday, July 4, 1997                  TAG: 9707040454

SECTION: BUSINESS                PAGE: D2   EDITION: FINAL 

SOURCE: BY TOM SHEAN, STAFF WRITER 

DATELINE: VIRGINIA BEACH                    LENGTH:   33 lines

JACKSON HEWITT FILES TO SELL STOCK

Hoping to raise at least $10.6 million of fresh capital, the tax-preparation service Jackson Hewitt Inc. has filed with the Securities and Exchange Commission for a public offering of one million common shares.

In its filing, the Virginia Beach-based company said it expects to use the proceeds to reduce its reliance on an existing line of credit and for working capital. In addition, it may use some of the funds to expand the number of company-owned stores and possible acquisitions of complimentary businesses.

Jackson Hewitt, a distant second in the tax-return business behind H&R Block, and its franchisees operated 1,372 offices in 41 states during the recent tax season.

In its SEC filing, Jackson Hewitt said a handful of existing shareholders plan to sell 130,790 of their common shares.

The company also disclosed that in late June it reached an agreement with certain stockholders who own more than a half-million shares of Jackson Hewitt convertible preferred stock. The agreement calls for converting this stock to 699,707 of Jackson Hewitt common shares, the company said.

The public offering will be managed by Janney Montgomery Scott Inc., a securities firm based in Philadelphia, and Scott & Stringfellow Inc., which is based in Richmond.

As part of the planned offering, the underwriters have an option to buy as many as 169,619 additional common shares, Jackson Hewitt said.

The company currently has 5.34 million common shares outstanding and 636 shareholders of record.

Jackson Hewitt's stock, which is traded on the Nasdaq National Market system, closed Thursday at $12 a share up 1/4 for the day.

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