PRELIMINARY PROXY STATEMENT
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 20, 1999
==============================================================================
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant To Section 14(a) of the
Securities Exchange Act Of 1934 (AMENDMENT NO. 1).
Filed by the Registrant [__]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[X]Preliminary Proxy Statement [_]Confidential, For Use of the
Commission Only (as permitted by Rule
14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
WEIS MARKETS, INC.
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(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
JANET C. WEIS
SUSAN WEIS MINDEL
JOEL S. MINDEL
NANCY WEIS WENDER
ELLEN WEIS GOLDSTEIN
JOSEPH I. GOLDSTEIN
SIDNEY APFELBAUM
MICHAEL M. APFELBAUM
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(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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<PAGE>
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[_]Fee paid previously with preliminary materials:
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[_]Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
1) Amount previously paid:
2) Form, Schedule or Registration Statement no.:
3) Filing Party:
4) Date Filed:
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PRELIMINARY PROXY MATERIALS DATED DECEMBER 20, 1999
SUBJECT TO COMPLETION
==============================================================================
[The information included herein is as it is expected to be when the definitive
proxy statement is mailed to shareholders of Weis Markets, Inc. This proxy
statement will be revised to reflect actual facts at the time of the filing of
the definitive proxy statement.]
No GOLD Proxy Card is included with these materials.
------------------------------------
PROXY STATEMENT OF
THE
WEIS MARKETS SHAREHOLDERS COMMITTEE
====================================
SPECIAL MEETING OF THE SHAREHOLDERS
OF
WEIS MARKETS, INC.
------------------------------------
We are sending this proxy statement to you as one of the holders of the common
stock, no par value, of Weis Markets, Inc., a Pennsylvania corporation. This
proxy statement relates to the solicitation of proxies by a Shareholders
Committee of Weis Markets shareholders, consisting of Janet C. Weis (the wife of
the late Sigfried Weis), Susan Weis Mindel, Joel S. Mindel, Nancy Weis Wender,
Ellen Weis Goldstein, Joseph I. Goldstein, Sidney Apfelbaum and Michael M.
Apfelbaum. We are soliciting these proxies for use at a Special Meeting of
shareholders scheduled for [_____], local time, [_______] [_________], 2000, at
[_______], or any adjournments or postponements of that meeting.
We are undertaking the actions described in this proxy statement because we
believe that, without such steps, the Weis Markets Board of Directors will not
take the steps we believe are necessary to take advantage of all available
options to maximize shareholder value in the current industry environment of
increasing competition and rapid consolidation.
We are soliciting proxies:
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o to remove the current Board of Directors of Weis Markets
o to reconstitute the Board of Directors to include the nominees set
forth in this proxy statement so as to better represent the entire
shareholder base in the event the current Board of Directors is
removed
o to call on Weis Markets to establish a special committee of directors
representative of all shareholder interests to explore all options to
maximize shareholder value, including possible merger and business
combination transactions and to encourage expressions of interest by
third parties in such transactions
o to amend the By-Laws of Weis Markets to provide that a majority of the
Board of Directors be comprised of non-employees and that the
membership of the Board of Directors reflect Weis Markets' shareholder
base, including all of its principal shareholders
o to amend the By-Laws of Weis Markets to set the size of the Board of
Directors at seven
o to repeal any amendments to the By-Laws of Weis Markets made after
November 30, 1999 and not approved by shareholders
o to set the order of business at the special meeting and to appoint a
judge of election to determine and report on the results of the
voting.
The principal executive offices of Weis Markets, according to its Quarterly
Report on Form 10-Q for the period ended September 25, 1999, are located at 1000
South Second Street, P.O. Box 471, Sunbury, Pennsylvania 17801-0471.
THIS PROXY STATEMENT AND THE ACCOMPANYING GOLD PROXY CARD ARE FIRST BEING
FURNISHED TO SHAREHOLDERS ON OR ABOUT [______, ____].
WE URGE YOU TO SIGN, DATE AND RETURN THE GOLD PROXY CARD IN FAVOR OF THE SPECIAL
MEETING PROPOSALS DESCRIBED HEREIN.
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SUMMARY
This summary highlights selected information from this proxy statement, and may
not contain all of the information that is important to you. To understand
better why we are asking for your vote, you should read this entire document
carefully.
Q: WHO ARE THE MEMBERS OF THE SHAREHOLDERS COMMITTEE?
A: We are fellow shareholders of Weis Markets. We believe that all Weis Markets
shareholders are missing an opportunity to maximize the value of their
investment in Weis Markets because the company is unwilling to pursue all
available strategies to enhance shareholder value, such as possible merger
and business combination transactions. We believe that in the current
environment of rapid consolidation, increasing competition and technological
change in the supermarket industry, Weis Markets has an obligation to protect
our collective investment by looking at all reasonably available alternatives
to increase shareholder value.
The members of the Shareholders Committee include Janet C. Weis, Susan Weis
Mindel, Joel S. Mindel, Nancy Weis Wender, Ellen Weis Goldstein, Joseph I.
Goldstein, Sidney Apfelbaum and Michael M. Apfelbaum. In the aggregate, the
members of the Shareholders Committee beneficially own approximately 41% of
the outstanding common stock of Weis Markets. Janet C. Weis was married to
the late Sigfried Weis, who served as the President of Weis Markets from 1961
through 1994 and as Co-Chairman of the Board of Directors until January 6,
1995. Sigfried Weis was the son of Sigmund Weis, one of two brothers who
co-founded Weis Markets.
Susan Weis Mindel, Nancy Weis Wender and Ellen Weis Goldstein are Janet Weis'
daughters. Joel S. Mindel is Susan Weis Mindel's husband, and Joseph I.
Goldstein is Ellen Weis Goldstein's husband and a director of Weis Markets.
Sidney Apfelbaum is a co-trustee of the Charles B. Degenstein Charitable
Foundation, which holds approximately 5.8% of the outstanding common stock of
Weis Markets. His son, Michael M. Apfelbaum, is a co-trustee of the Claire
Gross Weis Deed of Trust, which holds approximately 9% of the outstanding
common stock of Weis Markets for the benefit of Susan Weis Mindel, Nancy Weis
Wender and Ellen Weis Goldstein, and is a director of Weis Markets. Claire
Gross Weis was the wife of Sigmund Weis and the mother of Sigfried Weis.
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Q: WHAT ARE WE ASKING YOU TO DO?
A: We are asking you to vote:
o to remove the current Board of Directors of Weis Markets
o to reconstitute the Board of Directors to include our nominees so as
to better represent the entire shareholder base in the event the
current Board of Directors is removed
o to request that Weis Markets establish a special committee of
directors representative of all shareholder interests to explore all
options to maximize shareholder value, including possible merger and
business combination transactions, and to encourage expressions of
interest by third parties in such transactions
o to amend the By-Laws of Weis Markets to provide that a majority of the
Board of Directors be comprised of non-employees and that the
membership of the Board of Directors reflect Weis Markets' shareholder
base, including each of its principal shareholders
o to amend the By-Laws of Weis Markets to set the size of the Board of
Directors at seven
o to repeal any amendments to the By-Laws of Weis Markets made after
November 30, 1999 and not approved by shareholders
o to set the order of business at the special meeting and to appoint a
judge of election to determine and report on the results of the
voting
Q: WHY ARE WE ASKING YOU TO VOTE FOR OUR PROPOSALS?
A: We believe that, currently, a majority of the Weis Markets Board of Directors
is not sufficiently committed to exploring all reasonably available
alternatives to maximize shareholder value and increase the liquidity of the
market for Weis Markets common stock. The Board of Directors has refused
numerous requests made by individual members of the Shareholders Committee to
take the affirmative steps we believe necessary to enhance value for all
shareholders.
We believe that now is the time for Weis Markets to vigorously pursue all
alternatives to maximize shareholder value, including possible merger and
business combination transactions. Our belief is based on a number of
factors:
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Shareholders of Weis Markets have essentially missed out on one of the
most remarkable periods of growth in the history of the U.S. stock
markets.
o The common stock of Weis Markets reached a high of $41.63 in 1987, and
never again returned to that level - until the market reaction to the
initial announcement of our platform on November 30, 1999. During the
same 12 year period, the S&P 500 Index appreciated by over 600%.
o The performance of Weis Markets common stock has been similarly
disappointing over 10- and 5-year periods as well. For the 10-year
period ending on November 29, 1999 (the day before our initial
announcement), an investment in the S&P 500 Index earned over 8 1/2
times as much as the same amount invested in Weis Markets common
stock. For the 5-year period ending on November 29, 1999, an
investment in the S&P 500 Index earned nearly 3 1/2 times as much as
the same amount invested in Weis Markets common stock.
The U.S. supermarket industry is currently experiencing an
unprecedented level of consolidation and this consolidation provides a
unique opportunity for Weis Markets.
o The value of announced merger and business combination transactions
in the supermarket industry since the beginning of 1995 exceeds $59
billion. Most of the larger of these transactions have been
stock-for-stock mergers, tax-free to shareholders. In addition,
many of these transactions involved regional chains, much like Weis
Markets, and provided shareholders with substantial premiums to the
prevailing trading ranges for the stock. We strongly believe that
now is the wrong time for the company to ignore opportunities to
seek a strategic partner.
o Based upon the advice we have received from Salomon Smith Barney, we
believe that the value that shareholders could receive in a sale or
merger transaction involving Weis Markets is likely to be
substantially in excess of the recent trading price of Weis Markets
common stock, which averaged approximately $34 5/8 in the month
preceding our initial announcement. We also believe that there
would likely be strong interest by potential acquirors in Weis
Markets. Salomon Smith Barney has advised us that, based upon a
preliminary analysis of Weis Markets using only publicly available
information, and without having conducted any solicitation of
third-party interest and relying upon recent merger and acquisition
precedents in the supermarket industry, it believes that a per share
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acquisition price in the range of $45 to $55 should reasonably be
obtainable in the current market environment. There can be no
assurances, however, that any such transaction will be completed.
o The precedent transactions analyzed by Salomon Smith Barney in
arriving at this range of potential values of Weis Markets in a merger
are as follows:
Date Acquiror Target
---- -------- ------
Announced:
----------
8/18/99 Food Lion Hannaford Bros.
7/23/99 Safeway Randall's
3/9/99 Koninklijke Ahold NV* Pathmark Stores,
Inc.*
10/19/99 Kroger Fred Meyer
10/13/99 Safeway Dominick's
Supermarkets
8/3/98 Albertson's American Stores
5/19/98 Koninklijke Ahold NV Giant Food
* Pending as of November 29, 1999, but subsequently abandoned.
The competitive landscape is undergoing dramatic change and we believe the
current management-controlled Board of Directors has not adequately
articulated a strategy to protect Weis Markets' franchise and its
shareholders, employees and local communities in light of the
proliferation of larger and stronger competitors.
o We believe that the current environment in which Weis Markets
operates, in addition to being marked by significant consolidation, is
growing increasingly competitive as larger competitors exploit
efficiencies resulting from greater operational scale and increased
capital and applied technology investments.
o In addition, the U.S. supermarket industry has seen increased
competition from non-traditional food retailers, led by Wal-Mart's
aggressive expansion of its supercenter concept.
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o While this consolidation and intensifying competition has been
occurring, Weis Markets' income from operations and net income have
essentially been flat for its last five fiscal years.
Weis Markets has not demonstrated a strong commitment to those corporate
governance principles that would assure that the interests of all
shareholders are fully and adequately represented by the Board of
Directors.
o The current Board of Directors does not adequately reflect the full
shareholder base and its interests. Four of the seven members of
the Board of Directors are "insiders" who are management employees
of Weis Markets. This composition is inconsistent with the
interests of the broad shareholder base of Weis Markets, which
includes holders owning a substantial majority of the outstanding
Weis Markets common stock whose interests are not directly aligned
with those of the management directors.
o A Board of Directors consisting of a majority of non-management
directors would better be able to represent the interests of all
shareholders.
We believe that Weis Markets shareholders needs a Board of Directors that is
independent enough to question whether the current strategy is working to
advance the company's fundamental responsibility to build shareholder value.
Now is the time to maximize value for all shareholders.
Q: WHY SHOULD YOU VOTE FOR OUR NOMINEES FOR THE RECONSTITUTED BOARD OF
DIRECTORS?
A: We believe that our nominees will exercise their independent business
judgment for the good of all shareholders and are, subject to their fiduciary
duties under applicable law, committed to pursuing all reasonable
opportunities to maximize shareholder value and enhance the liquidity of the
trading market for Weis Markets common stock.
If our nominees are elected, we believe that a majority of the Board of
Directors would, subject to their fiduciary duties, be committed to promptly
seeking a merger or other business combination transaction that would
increase shareholder value. After consultation with Salomon Smith Barney, we
believe that Weis Markets is an attractive asset and that a number of
companies are likely to be interested in acquiring Weis Markets at a value
that is likely to be well in excess of the trading values for the common
stock prevailing before our initial announcement. There
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can be no assurances, however, that any such transaction will be completed.
Q: WHO ARE OUR NOMINEES?
A: Our nominees are Michael M. Apfelbaum, John S. Furst, Joseph I. Goldstein
and Jeffrey E. Perelman. Mr. Apfelbaum and Mr. Goldstein are members of
the Shareholders Committee and currently serve as directors of Weis
Markets. John S. Furst and Jeffrey E. Perelman are independent
businessmen with exceptional backgrounds who have agreed at the request of
the Shareholders Committee to serve as additional directors of Weis
Markets. You can find additional information about these nominees in the
Annexes to this proxy statement.
The Shareholders Committee's interest is in a Board structure that gives each
shareholder constituency adequate representation on the Board, and
accordingly, should shareholders approve our proposal to remove the current
Board of Directors, we do not oppose the re-election of Robert F. Weis,
Norman S. Rich and Jonathan H. Weis (or Richard E. Shulman as an alternate in
place of one of them) to fill the remaining three vacancies on the Board of
Directors and serve alongside our four nominees.
Q: HOW MANY VOTES DOES IT TAKE TO RECONSTITUTE THE BOARD?
A: Under the applicable requirements of Pennsylvania law and the Articles of
Incorporation and By-Laws of Weis Markets, the first step in reconstituting
the Board of Directors - the removal of the entire Board of Directors -
requires that a majority of the votes cast by all shareholders entitled to
vote at the Special Meeting be affirmatively voted in favor of removal. With
respect to the second step in reconstituting the Board of Directors -
electing new directors to the Board of Directors - because Weis Markets has
cumulative voting for directors, you have the right to cast an aggregate
number of votes equal to the number of shares of common stock you are
entitled to vote multiplied by the number of directors to be elected. Under
cumulative voting, a shareholder may cast all of these votes for a single
candidate or distribute them among some or all of the candidates as he or she
sees fit, and the nominees receiving the most votes cast will be elected, up
to the number of directors to be elected at the Special Meeting. The persons
named as proxies in the accompanying proxy card will vote all shares
represented by any GOLD proxy card for our nominees as indicated on such
card. With respect to shares owned by members of the Shareholders Committee,
we intend to cause cumulative voting rights to be exercised so as to maximize
the number of our nominees elected to the Board, given the number of votes
cast in favor of our nominees.
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You should note that these actions need only be approved by a majority (or
plurality) of the shares voted, and not a majority (or plurality) of the
outstanding shares. Thus, shares which are not voted either because of
abstention or because beneficial owners of shares do not instruct their
brokerage firm, bank or other institution how to vote their shares (so-called
"broker non-votes"), will be counted for purposes of whether a quorum exists
at the Special Meeting, but will not count as votes cast. Accordingly,
abstentions and broker non-votes will serve to decrease the aggregate number
of votes which are necessary to approve these actions.
Given the existence of cumulative voting and a seven member Board of
Directors, the Shareholders Committee has sufficient voting power to cause
the election of three nominees to the Board of Directors without any
additional votes being cast in their favor by any other shareholders of Weis
Markets, a step we intend to take at such time as directors are again
elected, whether at the Special Meeting or any subsequent annual meeting. The
Shareholders Committee requires only votes relating to such number of shares
as is equal to approximately (x) [__] million shares minus (y) 50% of the
total number of shares outstanding which are either absent or are otherwise
not voted at the Special Meeting in favor of any director nominee, to be
voted in favor of our nominees in order to have a majority of votes cast at
the meeting and accordingly be able to elect a fourth nominee to the Board of
Directors in an election of directors.
Q WHOM SHOULD YOU CALL IF YOU HAVE QUESTIONS ABOUT GIVING YOUR PROXY OR NEED
ASSISTANCE IN VOTING YOUR SHARES?
A: MacKenzie Partners, Inc. at (212) 929-5500 (collect) or call Toll Free
(800) 322-2885.
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IMPORTANT
Please review this document and the enclosed materials carefully. It does not
matter how many shares of common stock you own. YOUR PROXY IS VERY IMPORTANT. If
you are unable to attend the Special Meeting in person, your proxy is the ONLY
means available for you to vote. Please vote FOR each of the proposals,
including the amendments to the By-Laws, the removal of the current Board of
Directors and the election of the nominees of the Shareholders Committee to the
Board of Directors, by signing, marking, dating and mailing the enclosed GOLD
Proxy as soon as possible.
Unless you indicate otherwise, the GOLD Proxy authorizes the persons named in
the proxy to vote, and such persons will vote, properly executed and duly
returned proxies FOR the amendments to the By-Laws described in this document,
FOR the removal of the current Board of Directors, FOR the election of the
Shareholders Committee's nominees to the Board of Directors, FOR the Shareholder
Value Resolution, and FOR the Omnibus Resolution described in this document that
sets the order of business for the Special Meeting and appoints judges of
election. We are not presently aware of any other matters to be brought before
the Special Meeting.
If you own shares of common stock but your stock certificate is held for you by
a brokerage firm, bank or other institution, it is very likely that the stock
certificate is actually in the name of the brokerage firm, bank or other
institution. If so, only that brokerage firm, bank or other institution can
execute the GOLD Proxy and vote your shares of common stock. The brokerage firm,
bank or other institution holding the shares for you is required to forward
proxy materials to you and solicit your instructions with respect to the
granting of proxies; it cannot vote your shares unless it receives your specific
instructions.
If you execute and deliver a proxy, it may subsequently be revoked by delivering
written notice of revocation to MacKenzie Partners, Inc. at 156 Fifth Avenue,
New York, New York 10010 or Weis Markets or by your vote at the Special Meeting.
A revocation may be in any written form validly signed and dated by you as long
as it clearly states that your prior proxy is no longer effective. Any validly
signed and dated revocation will supersede any previously dated or undated GOLD
Proxy. To be effective, your written notice of revocation must be signed, dated
and delivered prior to the Special Meeting.
If you sign, date and deliver a GOLD Proxy and thereafter, on one or more
occasions, sign, date and deliver a later-dated proxy, the latest-dated proxy
will be controlling as to your vote and will replace your prior proxy or
proxies. However, any later-dated proxy will be of no effect if it is delivered
after the
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Special Meeting. ONLY YOUR LATEST DATED PROXY FOR THE SPECIAL MEETING WILL COUNT
AT THE SPECIAL MEETING.
If Weis Markets chooses to oppose our proposals and if, in such instance, you
sign a proxy revocation card sent to you by Weis Markets, you may override that
revocation by returning to MacKenzie Partners, Inc. at 156 Fifth Avenue, New
York, New York 10010 a subsequently dated and signed GOLD Proxy.
If you have any questions about the proxy or need assistance in voting your
shares, please call:
[LOGO OF MACKENZIE PARTNERS APPEARS HERE]
156 Fifth Avenue
New York, New York 10010
(212) 929-5500 (Collect)
or call Toll Free
(800) 322-2885
YOU MAY VOTE FOR THE REMOVAL OF THE CURRENT BOARD OF DIRECTORS, FOR THE ELECTION
OF NOMINEES OF THE SHAREHOLDERS COMMITTEE, FOR THE AMENDMENTS TO THE BY-LAWS,
FOR THE SHAREHOLDER VALUE RESOLUTION AND FOR THE OMNIBUS RESOLUTION BY SIGNING
THE GOLD PROXY CARD, AND MARKING, DATING AND RETURNING IT IN THE ENCLOSED
POSTAGE PAID ENVELOPE. IF YOU HAVE ALREADY SUBMITTED A PROXY TO THE BOARD OF
DIRECTORS, YOU MAY CHANGE YOUR VOTE BY SIGNING, MARKING, DATING AND RETURNING
THE GOLD PROXY, WHICH MUST BE DATED AFTER THE DATE OF THE PROXY YOU SUBMITTED TO
WEIS MARKETS.
Only shareholders of record at the close of business on the record date, [_____
____], 2000, are entitled to vote at the Special Meeting. We believe that as of
the close of business on the record date, there were approximately [__________]
shares of common stock issued and outstanding and entitled to vote. Shareholders
have one vote for each share of common stock they own with respect to all
matters to be considered at the Special Meeting, other than the election of
directors, as described below. The entire Board of Directors can be removed by a
vote of a majority of the shares voted at the Special Meeting.
Once the Board of Directors is removed, shareholders may cumulate their votes
for new directors and the nominees receiving the highest number of votes cast
will be elected, up to the number of directors to be elected at the Special
Meeting.
As noted above, the Shareholders Committee has sufficient voting power to cause
the election of three directors at any election of directors and requires
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only votes relating to such number of shares as is equal to approximately (x)
[__] million shares minus (y) 50% of the total number of shares outstanding
which are either absent or are otherwise not voted at the Special Meeting in
favor of any director nominee, to be voted in favor of our nominees in order to
have a majority of votes cast at the meeting and accordingly be able to elect a
fourth nominee to the Board of Directors in an election of directors.
We are asking you to return your completed, signed and dated GOLD Proxy Card as
soon as possible.
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REASONS FOR THE SOLICITATION
We believe that, currently, a majority of the Weis Markets Board of Directors is
not sufficiently committed to exploring all reasonably available alternatives to
maximize shareholder value and increase the liquidity of the market for its
common stock. In the past, the Board of Directors has refused informal requests
made by individual members of the Shareholders Committee to take the affirmative
steps we believe necessary to enhance value for all shareholders.
We believe that now is the time for Weis Markets to vigorously pursue all
alternatives to maximize shareholder value, including possible merger and
business combination transactions. Our belief is based on a number of factors:
Shareholders of Weis Markets have essentially missed out on one of the
most remarkable periods of growth in the history of the U.S. stock
markets.
o The common stock of Weis Markets reached a high of $41.63 in 1987, and
never again returned to that level - until the market reaction to the
initial announcement of our platform on November 30, 1999. During the
same 12 year period, the S&P 500 Index appreciated by over 600%.
o The performance of Weis Markets common stock has been similarly
disappointing over 10- and 5-year periods as well. For the 10-year
period ending on November 29, 1999 (the day before our initial
announcement), an investment in the S&P 500 Index earned over 8 1/2
times as much as the same amount invested in Weis Markets common
stock. For the 5-year period ending on November 29, 1999, an
investment in the S&P 500 Index earned nearly 3 1/2 times as much as
the same amount invested in Weis Markets common stock.
The U.S. supermarket industry is currently experiencing an
unprecedented level of consolidation and this consolidation provides a
unique opportunity for Weis Markets.
o The value of announced merger and business combination transactions
in the supermarket industry since the beginning of 1995 exceeds $59
billion. Most of the larger of these transactions have been
stock-for-stock mergers, tax-free to shareholders. In addition,
many of these transactions involved regional chains, much like Weis
Markets, and provided shareholders with substantial premiums to the
prevailing trading ranges for the stock. We
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strongly believe that now is the wrong time for the company to ignore
opportunities to seek a strategic partner.
o Based upon the advice we have received from Salomon Smith Barney, we
believe that the value that shareholders could receive in a sale or
merger transaction involving Weis Markets is likely to be
substantially in excess of the recent trading price of Weis Markets
common stock which averaged approximately $34 5/8 in the month
preceding our initial announcement. We also believe that there would
likely be strong interest by potential acquirors in Weis Markets.
Salomon Smith Barney has advised us that, based upon a preliminary
analysis of Weis Markets using only publicly available information,
and without having conducted any solicitation of third-party interest
and relying upon recent merger and acquisition precedents in the
supermarket industry, it believes that a per share acquisition price
in the range of $45 to $55 should reasonably be obtainable in the
current market environment. There can be no assurances, however, that
any such transaction will be completed.
o The precedent transactions analyzed by Salomon Smith Barney in
arriving at this range of potential values of Weis Markets in a merger
is as follows:
Date Acquiror Target
---- -------- ------
Announced:
----------
8/18/99 Food Lion Hannaford Bros.
7/23/99 Safeway Randall's
3/9/99 Koninklijke Ahold NV* Pathmark Stores,
Inc.*
10/19/99 Kroger Fred Meyer
10/13/99 Safeway Dominick's
Supermarkets
8/3/98 Albertson's American Stores
5/19/98 Koninklijke Ahold NV Giant Food
* Pending as of November 29, 1999, but subsequently abandoned.
The competitive landscape is undergoing dramatic change and we believe the
current management controlled Board of Directors Weis Markets has not
adequately articulated a strategy to protect Weis
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Markets' franchise and shareholders, employees and local communities in
light of the proliferation of larger and stronger competitors.
o We believe that the current environment in which Weis Markets
operates, in addition to being marked by significant consolidation, is
growing increasingly competitive as larger competitors exploit
efficiencies resulting from greater operational scale and increased
capital and applied technology investments.
o In addition, the U.S. supermarket industry has seen increased
competition from non-traditional food retailers, led by Wal-Mart's
aggressive expansion of its supercenter concept.
o While this consolidation and intensifying competition has been
occurring, Weis Markets' income from operations and net income have
essentially been flat for its last five fiscal years.
Weis Markets has not demonstrated a strong commitment to those corporate
governance principles that would assure that the interests of all
shareholders are fully and adequately represented by the Board of
Directors.
o The current Board of Directors does not adequately reflect the full
shareholder base and its interests. Four of the seven members of
the Board of Directors are "insiders" who are management employees
of Weis Markets. This composition is inconsistent with the
interests of the broad shareholder base of Weis Markets, which
includes holders owning a substantial majority of the outstanding
Weis Markets common stock whose interests are not directly aligned
with those of the management directors.
o A Board of Directors consisting of a majority of non-management
directors would better be able to represent the interests of all
shareholders.
We believe that Weis Markets shareholders need a Board of Directors that is
independent enough to question whether the current strategy is working to
advance the company's fundamental responsibility to build shareholder value.
Now is the time to maximize value for all shareholders.
Toward that end, we believe Weis Markets should undertake measures that will
ensure that the composition of the Board of Directors better reflects all of the
shareholder constituencies, that the full value of the common stock is
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reflected in its share price and that greater liquidity is available to all
shareholders. These measures include the following:
o Changing the composition of the Board of Directors such that the Board
of Directors contains equal representation of all principal
shareholders of Weis Markets and a strong base of non-management
directors who can represent the interests of all shareholders, and
o Establishing a special committee of directors representative of all
shareholder interests to consider and evaluate the strategic options
available to Weis Markets for maximizing shareholder value and
providing enhanced liquidity to shareholders, including through
possible business combination and merger transactions.
We believe that, if elected, our nominees would, subject to their fiduciary
duties under applicable law, vote in favor of a resolution to retain Salomon
Smith Barney to assist Weis Markets and the special committee of directors
representative of all shareholder interests in its examination and pursuit of
these alternatives.
At the Special Meeting, we intend to present and have voted upon and approved by
the shareholders the following proposals (the "Special Meeting Proposals"), in
addition to other proposals incidental to the reconstitution of the current
Board of Directors:
1. To remove the current Board of Directors, including without
limitation, any of the following who are members of the Board as of
the Special Meeting: Robert F. Weis, Norman S. Rich, William R.
Mills, Jonathon H. Weis, Michael M. Apfelbaum, Joseph I. Goldstein
and Richard E. Shulman (the "Director Removal Resolution").
2. To elect Michael M. Apfelbaum, John S. Furst, Joseph I. Goldstein
and Jeffrey E. Perelman to fill four of the seven vacancies on the
Board of Directors created if the Director Removal Resolution is
adopted (the "Election of Directors Resolution"). Biographical
information on each of these nominees is set forth under the caption
"The Special Meeting Proposals".
3. To amend the By-Laws to provide that a majority of the members of
the Board of Directors shall be persons who are not employees of
Weis Markets, and that the Board shall reflect as fully as possible
the composition of the shareholder base (the "Board Composition
Resolution").
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4. To request that the Board of Directors establish a special committee
of directors representative of all shareholder interests to explore
all options to maximize shareholder value, including possible mergers
and business combination transactions, report any overtures from any
third parties with respect to such options that may be received to the
Board and the shareholders and that such overtures be fully explored
(the "Shareholder Value Resolution").
5. To amend the By-Laws to set the number of directors at seven (the
"Board Size Resolution").
6. To repeal any and all amendments made by the Board of Directors to the
By-Laws after November 30, 1999, other than amendments that were
duly approved by the shareholders, and to provide that, without
approval of the shareholders, the Board of Directors may not
thereafter amend any section of the By-Laws affected by such
repeal or adopt any new By-Law provision that would serve to reinstate
any repealed provision or any similar provision (the "By-Laws Repeal
Resolution").
Further, the shareholders will be asked at the Special Meeting to consider an
Omnibus Resolution (the "Omnibus Resolution") setting forth the following order
in which the Special Meeting Proposals will be voted on by the shareholders and
appointing CT Corporation System to act as sole judge of election:
1. The Omnibus Resolution;
2. The By-Laws Repeal Resolution;
3. The Board Size Resolution;
4. The Board Composition Resolution;
5. The Shareholder Value Resolution;
6. The Director Removal Resolution; and
7. The Election of Directors Resolution.
EXECUTING A GOLD PROXY CARD WILL ENABLE YOU -- AS AN OWNER OF THE COMPANY -- TO
SEND A CLEAR MESSAGE THAT YOU SUPPORT THE SHAREHOLDERS COMMITTEE'S DESIRE TO
INCREASE SHAREHOLDER VALUE AND PROVIDE ENHANCED LIQUIDITY TO ALL SHAREHOLDERS
AND WANT A BOARD OF
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DIRECTORS THAT WILL SEEK TO DO SO AND THAT MORE FULLY REFLECTS WEIS MARKETS'
SHAREHOLDER BASE. WE STRONGLY RECOMMEND THAT YOU VOTE TO REMOVE THE CURRENT
DIRECTORS, ELECT A RECONSTITUTED BOARD OF DIRECTORS AND AMEND THE BY-LAWS, VOTE
IN FAVOR OF THE SHAREHOLDER VALUE RESOLUTION AND THE OMNIBUS RESOLUTION.
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BACKGROUND AND RECENT EVENTS
On November 30, 1999, the members of the Shareholders Committee filed with the
Securities and Exchange Commission a Statement on Beneficial Ownership on
Schedule 13D on the basis that certain actions they intended to take, including
the solicitation of proxies by this proxy statement, might be sufficient to have
the Shareholders Committee be deemed a "group" for purposes of Section 13 of the
Securities Exchange Act of 1934. The members of the Shareholders Committee have
subsequently amended this Schedule 13D from time to time as events have
warranted.
Also on that date, the members of the Shareholders Committee delivered to Weis
Markets a request to call the Special Meeting of shareholders and a notice of
their intent to present business and make nominations thereat. The business and
nominations to be presented at that special meeting are those that are described
in this proxy statement.
Simultaneously with these actions the Shareholders Committee issued a press
release calling on Weis Markets to voluntarily change the composition of the
Board of Directors to better represent the entire shareholder base of Weis
Markets and to establish a special committee of directors to evaluate the
strategic options available to Weis Markets for maximizing shareholder value,
including through possible business combination and merger transactions.
On December 2, 1999, Weis Markets issued a press release stating that it would
oppose the actions of the Shareholders Committee and that Weis Markets was not
for sale (although the press release stated that it was actively working with
its financial advisors to study a range of alternatives to create value).
On December 7, 1999, Weis Markets issued a press release announcing that the
Board of Directors established a special committee of directors to evaluate and
consider responses to our proposals. According to the press release, this
special committee consists of all directors other than Michael M. Apfelbaum and
Joseph I. Goldstein, who are affiliated with the Shareholders Committee.
Accordingly, four of the five members of this committee are management employees
of Weis Markets, a composition which we believe is far from representative of
the interests of all shareholders.
On December 8, 1999, the Shareholders Committee issued a further press release
strongly renewing its call on Weis Markets to set a record date and give notice
of a special meeting, to be convened no later than February 7. In this press
release, the Shareholders Committee stressed that it remained open to all
options that would deliver full and fair value to all shareholders of
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the Weis Markets and its belief that any consideration of such options must
start with a fair and informed evaluation of the potential for strategic merger
combinations involving Weis Markets.
Later on December 8, Weis Markets issued a press release acknowledging that,
under Weis Markets' By-Laws, Weis Markets was obligated to hold a special
meeting before the end of February, and stating that it would announce record
and meeting dates in an appropriate and timely manner.
A copy of the initial (November 30, 1999) press release issued by the
Shareholders Committee is attached to this proxy statement as Annex X.
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THE SPECIAL MEETING PROPOSALS
At the Special Meeting, shareholders will be asked to consider and vote on the
Special Meeting Proposals set forth below.
PROPOSAL NO. 1: THE DIRECTOR REMOVAL RESOLUTION
Our goal is to reconstitute the Board of Directors to more fully represent the
interests of all shareholders. We believe our nominees will, subject to their
fiduciary duties under applicable law, be committed to our goals of increasing
shareholder value and liquidity. We are asking you to vote at the Special
Meeting to remove the entire Board of Directors to allow our nominees to
constitute a majority of the Board.
Although the terms of the current Board of Directors expire at the 2000 Annual
Meeting, there can be no assurance that before the Special Meeting one or more
of the current Board of Directors will not have ceased to be a director (by
reason of resignation or otherwise) and have been succeeded by another person
appointed by the incumbent directors. Accordingly, the GOLD Proxy provides for
the removal of each of the current member of the Board and all other persons who
are serving as directors when the removal becomes effective. Section 1726 of the
Pennsylvania Business Corporation Law authorizes these actions, with or without
cause, by a vote of a majority of the shares voted at the Special Meeting if at
least a majority of the shares of common stock entitled to vote at the Special
Meeting are represented at that meeting.
The full text of the Director Removal Resolution is contained in Annex I to this
proxy statement.
WE STRONGLY RECOMMEND A VOTE FOR THE REMOVAL
OF THE CURRENT BOARD OF WEIS MARKETS
PROPOSAL NO. 2: THE ELECTION OF DIRECTORS RESOLUTION
As the second step of the reconstitution of the Board of Directors, if the
Directors Removal Resolution is approved, we are asking you to elect at the
Special Meeting the nominees named below as directors of Weis Markets, to serve
until the next annual meeting of shareholders and until their successors shall
have been duly elected and qualified. Under Pennsylvania law and the By-Laws,
shareholders are permitted to cumulate their votes in election of directors.
Under cumulative voting, a shareholder may cast a number of votes equal to the
number of shares the shareholder holds of record on the record date, multiplied
by the number of directors to be elected. The nominees receiving the greatest
number of votes cast at the Special Meeting will be elected to the Board of
Directors, up to the number of director
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positions to be filled at the Special Meeting. By executing and returning the
GOLD proxy, you will be granting the proxies named on the GOLD proxy card power
to vote all shares represented by such proxy card for only our four nominees as
set forth on such card.
Our nominees include two incumbent members of the Board of Directors: Michael M.
Apfelbaum and Joseph I. Goldstein, and two additional nominees, John S. Furst
and Jeffrey E. Perelman. Mr. Apfelbaum and Mr. Goldstein are members of the
Shareholders Committee and share the concerns and goals of the Shareholders
Committee as outlined in this proxy statement. Mr. Furst and Mr. Perelman are
independent professional businessmen who have indicated to the members of the
Shareholders Committee that they are supportive of the platform enunciated in
this proxy statement, and will strive to exercise their fiduciary duties and
represent the interests of all shareholders through the exercise of their
independent business judgment.
We intend to vote the shares beneficially owned by us such that, when aggregated
with any other shares with respect to which proxies are granted in favor of the
Election of Directors Resolution, tha maximum number of our nominees will be
elected to the Board of Directors. As noted above, Weis Markets allows
cumulative voting of directors. Due to the effect of cumulative voting, the
shares held by the Shareholders Committee constitute sufficient voting power to
cause the election of three directors to the Board of Directors at any election
of directors, and we require only such number of shares as is equal to
approximately (x) [__] million shares minus (y) 50% of the total number of
shares outstanding which are either absent or are otherwise not voted at the
Special Meeting in favor of any director nominee, voting in favor of our
nominees in order to elect a fourth nominee to the Board of Directors in an
election of directors.
The size of the Weis Markets Board is currently seven directors, and if approved
the Board Size Resolution would fix the size at that number unless shareholders
of Weis Markets approved a change. Accordingly, we currently expect that removal
of the entire Board of Directors pursuant to the Removal of Directors Resolution
will create seven vacancies on the Board of Directors and we have taken steps to
ensure that at least seven director candidates will be placed in nomination.
Consistent with the views of the Shareholders Committee regarding the
appropriate representation of shareholders interests on the Board, we are
proposing a slate of four nominees to be elected as directors. If a majority of
the votes cast at the Special Meeting are cast in favor of our slate, our
nominees will constitute a majority of the Board of Directors. Because we are
committed to a Board of Directors that fairly reflects each of Weis Markets'
shareholder constituencies, we do not oppose the re-election of Robert F. Weis,
Norman S. Rich or Jonathan H. Weis (or, as an alternative to any one of them,
Richard Shulman or such other person as
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Robert Weis and Ellen Wasserman should nominate) to fill three of the seats on
the Board and to serve along with our four nominees.
Our nominees have furnished us with the following information concerning their
principal occupations, business addresses and certain other matters. All of our
nominees are citizens of the United States.
Shareholders Committee nominees
Michael M. Apfelbaum (39) is engaged in the private practice of law as a
Partner with the firm of Apfelbaum, Apfelbaum and Apfelbaum of Sunbury,
Pennsylvania. Mr. Apfelbaum serves as a Co-Counsel for the Charles B.
Degenstein Foundation and as City Solicitor to the City of Sunbury. Mr.
Apfelbaum has been a member of the Board of Directors since 1996. Mr.
Apfelbaum's business address is: Apfelbaum, Apfelbaum & Apfelbaum, 43
South Fifth Street, Sunbury, PA 17801.
John S. Furst (68) has been President of Manufacturer's Leasing and Finance,
Inc. since 1995, President of S.F.K. Inc. since 1995 and was President of
Aluminum Tank and Truck Accessories from 1996 to 1999. Until his retirement
on February 1, 1993, Mr. Furst worked as a certified public accountant and
was a partner for 25 years with Coopers & Lybrand, spending the final 12
years of his employment as a member of the governing body of the firm. From
November 1993 through March 1995, Mr. Furst was a consultant to the Chairman
of Coopers & Lybrand. Mr. Furst's business address is: 190 Shady Shores
Drive, Mabank, TX 75147-9133.
Joseph I. Goldstein (57) is engaged in the private practice of law as a
Partner with the firm of Kirkpatrick and Lockhart, LLP, Washington D.C. Until
October 1999, he was engaged in the private practice of law as a Partner with
the firm of Crowell & Moring, Washington, D.C. Prior to joining Crowell &
Moring in 1995, he was an Associate Director of the Division of Enforcement,
United States Securities and Exchange Commission. Mr. Goldstein has been a
member of the Board of Directors since 1995. Mr. Goldstein's business address
is: Kirkpatrick and Lockhart, LLP, 1800 Massachusetts Avenue, N.W.,
Washington, D.C. 20036-1800.
Jeffrey E. Perelman (50) has served as Chief Executive Officer of the
following companies for the last 5 years: DentalEZ Group, Columbia
Dentoform, Schiller-Pfeiffer, Inc., Newton Tool & Mfg. Company, General
Machine Corporation, United Ammunition Container and JEP Management, Inc.
Mr. Perelman has served as Chief Executive Officer of Den-Tal-Ez Alabama,
Inc. since 1997 and as Chief Executive Officer of
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Mantis Europe, Inc. since 1995. Mr. Perelman's business address is: JPE
Management, Inc., Plymouth Corporate Center, 625 Ridge Pike, Conshohocken, PA
19096.
Each of Messrs. Apfelbaum, Goldstein, Furst and Perelman have consented to serve
as a director if elected and to be named as nominees of the Shareholders
Committee in this proxy statement.
Weis Markets currently has seven Directors, all of whose terms will expire at
the next Annual Meeting of shareholders of Weis Markets in 2000. Each of the
nominees specified above, if elected, would hold office until the 2000 Annual
Meeting and until a successor has been elected and qualified or until his
earlier death, resignation or removal. Although we have no reason to believe
that any of our nominees will be unable to serve as directors, we reserve the
right to nominate an additional person in his stead, including any other member
of the Shareholders Committee.
The full text of the Election of Directors Resolution is contained in Annex II
to this proxy statement. Presentation of the Election of Directors Resolution is
contingent upon shareholder approval of the Director Removal Resolution. If the
Board of Directors is not removed, no vacancies will be created to which new
directors may be elected.
WE STRONGLY RECOMMEND A VOTE FOR THE ELECTION
OF THE NOMINEES OF THE SHAREHOLDERS COMMITTEE
PROPOSAL NO. 3: THE BOARD COMPOSITION RESOLUTION
The Board Composition Resolution provides that a majority of the Board of
Directors shall consist of directors who are not employees of Weis Markets. This
provision would bring Weis Markets in line with "best practices" corporate
governance principles. We believe that having a majority of the Board of
Directors consist of directors who are also management employees of Weis Markets
is inconsistent with the interests of the broad shareholder base. This
shareholder base includes holders of a substantial majority of the common stock
whose interests are not directly aligned with those of management directors.
The full text of the Board Composition Resolution is contained in Annex III to
this proxy statement.
WE STRONGLY RECOMMEND A VOTE
FOR THE BOARD COMPOSITION RESOLUTION
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PROPOSAL NO. 4: THE SHAREHOLDER VALUE RESOLUTION
The Shareholders Committee believes that the value of the common stock would
likely be maximized through the merger or other business combination transaction
of Weis Markets to or with an unaffiliated third party, and recommends actions
to be taken by the Board of Directors to enhance shareholder value.
The Shareholder Value Resolution requests that the Board establish a special
committee consisting of directors representative of all shareholder interests to
consider and evaluate the strategic options available to Weis Markets for
maximizing shareholder value and providing enhanced liquidity to shareholders
including through possible business combination and merger transactions. The
Shareholder Value Resolution requests that Weis Markets require that any and all
overtures (whether formal or informal) by any unaffiliated third parties
received by Weis Markets or any of its officers or directors concerning such a
possible sale or merger are to be reported to the full Board of Directors, that
all bona fide overtures be explored in full and that offers from any such
persons should be solicited and not discouraged, with a full report of such
matters to be made to the shareholders of Weis Markets.
While under applicable laws the Shareholder Value Proposal may not be legally
binding on Weis Markets, it serves to state those steps that the Shareholders
Committee believes the Board of Directors should take in order to fulfill its
obligations to shareholders to maximize shareholder value. There can also be no
assurance that, even if the Shareholder Value Resolution is adopted, such a
transaction will be completed.
The full text of The Shareholder Value Resolution is contained in Annex IV to
this proxy statement.
WE STRONGLY RECOMMEND A VOTE
FOR THE SHAREHOLDER VALUE RESOLUTION
PROPOSAL NO. 5: THE BOARD SIZE RESOLUTION
The By-Laws of Weis Markets provide that the size of the Board of Directors
shall be fixed from time to time by resolution of the Board of Directors or the
shareholders and shall consist of not less than three directors. According to
the information made publicly available by Weis Markets as of the date of this
preliminary proxy statement, there are currently seven directors on the Board of
Directors. Adoption of the Board Size Resolution would fix the number of
directors at its present number of seven. This amendment would further provide
that such By-Law may not be amended, or any new By-Law provision which is in any
way inconsistent therewith, be adopted, without
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approval of the shareholders. Section 1504(a) of the Pennsylvania Business
Corporation Law authorizes this action by a vote of a majority of the shares
cast at the Special Meeting if at least a majority of the shares of common stock
are represented at the meeting.
The Board Size Resolution is designed to prevent the current Board of Directors
from frustrating the ability of the shareholders to elect a majority of the
Board of Directors through the election of all four of our nominees.
We believe that the Board of Directors' ability to attempt to change the size of
the Board of Directors under the circumstances is limited by its fiduciary
duties. However, by fixing the number of Board of Directors seats at seven,
adoption of the Board Size Resolution will ensure that the election contest at
the Special Meeting will take place on a level playing field.
The full text of The Board Size Resolution is contained in Annex V to this proxy
statement.
WE STRONGLY RECOMMEND A VOTE FOR THE
BOARD SIZE RESOLUTION
PROPOSAL NO. 6: THE BY-LAWS REPEAL RESOLUTION
The By-Laws Repeal Resolution would repeal any and all amendments made by the
Board of Directors to the By-Laws following November 30, 1999, other than those
provisions, if any, which were duly approved by the shareholders. This
resolution also will provide that, without the approval of the shareholders, the
Board of Directors may not thereafter amend any section of the By-Laws affected
by such repeal or adopt any new By-Law provision in a manner which serves to
reinstate any repealed provision or any similar provision. Section 1504(a) of
the Pennsylvania Business Corporation Law authorizes this action by a vote of a
majority of the shares cast at the Special Meeting if at least a majority of the
shares of common stock are represented at the meeting.
The By-Laws Repeal Resolution is intended to repeal any By-Law changes that the
Board of Directors may attempt to make prior to the Special Meeting. Although we
are currently unaware of any specific By-Law provisions which would be repealed
by adoption of the By-Laws Repeal Resolution, adoption of the By-Laws Repeal
Resolution would render ineffective any attempted modification of the By-Laws by
the Board of Directors, whether intended to frustrate the ability of the
shareholders to elect our nominees or adopt any of the other Special Meeting
Proposals or otherwise. The By-Laws Repeal Resolution is intended to guarantee
that any By-Law amendment adopted after November 30, 1999 will be repealed so as
to prevent the Board of Directors from altering the By-Laws prior to the
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Special Meeting without shareholder approval and to prevent the Board of
Directors after the Special Meeting from amending any section of the By-Laws
affected by such repeal or adopting any new By-Law provision in a manner which
serves to reinstate any repealed provision or any similar provision.
Although adoption of the By-Laws Repeal Resolution would generally repeal
previously undisclosed By-Law amendments without considering the beneficial
nature, if any, of such amendments to the shareholders, it would not repeal any
such amendments that were approved by the shareholders.
The full text of the By-Laws Repeal Resolution is contained in Annex VI to this
proxy statement.
WE STRONGLY RECOMMEND A VOTE FOR THE
BY-LAWS REPEAL RESOLUTION
PROPOSAL NO. 7: THE OMNIBUS RESOLUTION
In addition, the shareholders will be asked at the Special Meeting to consider
the Omnibus Resolution which appoints CT Corporation System as sole judge of
election, so as to ensure that the various votes of the shareholders are
efficiently and accurately tallied, and sets forth the following order in which
the resolutions will be voted upon by the shareholders:
1. The Omnibus Resolution;
2. The Election Procedures Resolution;
3. The By-Laws Repeal Resolution;
4. The Board Composition Resolution;
5. The Shareholder Value Resolution;
6. The Director Removal Resolution; and
7. The Election of Directors Resolution.
The full text of the Omnibus Resolution is contained in Annex VII to this proxy
statement.
WE STRONGLY RECOMMEND
A VOTE FOR THE OMNIBUS RESOLUTION
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INFORMATION ON THE SPECIAL MEETING
Based on currently available public information, a quorum will exist at the
Special Meeting if holders of at least a majority of the shares of common stock
outstanding and entitled to vote at the Special Meeting are present in person or
by proxy. If a quorum is present at the Special Meeting, the shareholders may
remove the Board of Directors by a majority of the votes cast at the Special
Meeting. Once the current Board of Directors is removed, shareholders may elect
new directors to fill vacancies on the Board.
If the shareholders present at the Special Meeting in person or by proxy are
entitled to vote to elect new directors, their votes may be cumulated and the
nominees receiving the greatest number of votes will be elected, up to the
number of nominees to be elected at the Special Meeting. Once elected to the
Board of Directors, each director will serve until the next annual meeting and
thereafter until his or her successor has been elected and qualified or until
his or her earlier death, resignation, retirement, disqualification or removal.
The GOLD Proxy will be voted at the Special Meeting in accordance with your
instructions. You may vote FOR the By-Law amendments, FOR the removal of the
current directors, FOR the election of our nominees as directors of Weis
Markets, FOR the Shareholder Value Resolution and FOR the Omnibus Resolution, or
withhold authority to vote for the By-Law amendments, for the removal of for the
current directors, for the election of the nominees, and for the Omnibus
Resolution by marking the proper boxes on the GOLD Proxy. You also may withhold
your vote from any of the nominees by writing the name of such nominee in the
space provided on the GOLD Proxy Card. IF NO MARKING IS MADE, YOU WILL BE DEEMED
TO HAVE GIVEN A DIRECTION TO VOTE THE SHARES REPRESENTED BY THE GOLD PROXY FOR
THE SPECIAL MEETING PROPOSALS IN THEIR ENTIRETY, INCLUDING FOR THE ELECTION OF
EACH OF OUR NOMINEES, PROVIDED THAT YOU HAVE SIGNED AND DATED THE PROXY CARD.
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PROXY PROCEDURES
In order for your views on the proposals to be heard by Weis Markets and
represented at the Special Meeting, please mark, sign and date the enclosed GOLD
Proxy and return it to MacKenzie Partners, Inc. at 156 Fifth Avenue, New York,
New York 10010, in the enclosed postage paid envelope in time to be voted at the
Special Meeting. Execution of the GOLD Proxy will not affect your right to
attend the Special Meeting and to vote in person.
You are eligible to execute a GOLD Proxy only if you owned the common stock on
the record date. If you own your shares of common stock "beneficially" (i.e.,
deriving the economic benefits of ownership thereof or having the power to vote
or dispose of such shares), but not "of record" (i.e., having one's name
recorded on the stock transfer records of Weis Markets), or if your ownership of
shares is through a broker, bank, other financial institution or other record
holder, you should contact your broker, bank, other financial institution or
other record holder and instruct such person or entity to execute the GOLD Proxy
on your behalf. If you acquired shares after the Record Date without a proxy,
you may not execute a GOLD Proxy to vote at the Special Meeting with respect to
such shares. You will retain the right to execute a proxy card in connection
with this proxy solicitation even if you sell your shares after the record date.
If you execute and deliver a proxy, it may subsequently be revoked by delivering
written notice of revocation to MacKenzie Partners, Inc. at 156 Fifth Avenue,
New York, New York 10010 or Weis Markets or by your vote at the Special Meeting.
A revocation may be in any written form validly signed and dated by you as long
as it clearly states that your prior proxy is no longer effective. Any validly
signed and dated revocation will supersede any previously dated or undated GOLD
Proxy. To be effective, your written notice of revocation must be signed, dated
and delivered prior to the Special Meeting.
If you sign, date and deliver a GOLD Proxy and thereafter, on one or more
occasions, sign, date and deliver a later-dated proxy, the latest-dated proxy
will be controlling as to your vote and will replace your prior proxy or
proxies. However, any later-dated proxy will be of no effect if it is delivered
after the Special Meeting. ONLY YOUR LATEST DATED PROXY FOR THE SPECIAL MEETING
WILL COUNT AT THE SPECIAL MEETING.
If Weis Markets chooses to oppose our proposals and if, in such instance, you
sign a proxy revocation card sent to you by Weis Markets, you may override that
revocation by returning to MacKenzie Partners, Inc. at 156 Fifth Avenue, New
York, New York 10010 a subsequently dated and signed GOLD Proxy.
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CERTAIN INFORMATION CONCERNING THE PARTICIPANTS
The members of the Shareholders Committee, was well as Messrs. Apfelbaum,
Goldstein, Furst and Perelman in their capacity as nominees, may be deemed to be
"participants" (as defined in Instruction 3 to Item 4 of Rule 14a-101 of the
Securities and Exchange Commission under the Exchange Act) in this proxy
solicitation. Certain information relating to the beneficial ownership of common
stock by the participants in this solicitation and certain other information is
contained in Annex VIII to this proxy statement and is incorporated in this
proxy statement by reference.
OTHER REPRESENTATIVES OF THE SHAREHOLDERS COMMITTEE WHO ALSO MAY ASSIST IN
THE SOLICITATION OF PROXIES
In connection with Salomon Smith Barney's engagement as our financial advisor,
we anticipate that certain employees of Salomon Smith Barney may communicate in
person, by telephone or otherwise with a limited number of institutions, brokers
or other persons who are shareholders for the purpose of assisting in the proxy
solicitation. Salomon Smith Barney will not receive any fee for, or in
connection with, such solicitation activities apart from the fees they are
otherwise entitled to receive under their engagement. See "General Information"
below. The principal business address of Salomon Smith Barney is 388 Greenwich
Street, New York, New York, 10013. Additional information regarding Salomon
Smith Barney is contained in Annex VIII to this Proxy Statement and is
incorporated in this proxy statement by reference.
GENERAL INFORMATION
This proxy statement and the accompanying GOLD Proxy Card are first being
furnished to shareholders on or about [___________________]. Executed proxies
may be solicited by mail, advertisement, telephone, telecopier and in person.
Solicitation may be made by members of the Shareholders Committee, none of whom
will receive compensation for such solicitation. Proxies will be solicited from
individuals, brokers, banks, bank nominees and other institutional holders. We
have requested banks, brokerage houses and other custodians, nominees and
fiduciaries to forward all solicitation materials to the beneficial owners of
the shares they hold of record. We will reimburse these record holders for their
reasonable out-of-pocket expenses.
In addition, we have retained MacKenzie Partners, Inc. as our information
agent and to solicit proxies in connection with the Special Meeting. We have
agreed to reimburse MacKenzie Partners, Inc. for its reasonable expenses and
to pay to MacKenzie Partners, Inc. fees not to exceed $[_______].
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MacKenzie Partners, Inc. will employ approximately [__] people in its efforts.
Costs incidental to this solicitation include expenditures for printing,
postage, legal and related expenses.
The members of the Shareholders Committee also have retained Salomon Smith
Barney to provide certain financial advisory services in connection with our
solicitation of proxies for the Special Meeting. Salomon Smith Barney is engaged
in providing a full range of banking, securities trading, market making and
brokerage services to institutional and individual clients, and will employ
approximately 10 people in its efforts.
In connection with the engagement of Salomon Smith Barney as our financial
advisor, members of the Shareholders Committee have entered into an engagement
letter agreement with Salomon Smith Barney. Pursuant to this engagement letter,
Salomon Smith Barney has agreed to perform such customary financial advisory and
investment banking services as are reasonably requested in connection with a
potential transaction, including the sale, transfer or other disposition of, or
special dividend with respect to, all or a significant portion of the shares of
common stock beneficially owned by the members of the Shareholders Committee and
certain members of those persons' families.
Salomon Smith Barney is entitled to receive fees for its services under this
engagement letter as follows: (a) $250,000 promptly upon execution of the
engagement letter; (b) $250,000 following successful completion of a proxy
solicitation, action by written consent, negotiated settlement or other event
pursuant to which the Shareholders Committee nominees represent a majority of
the Board of Directors of Weis Markets; (c) an additional fee determined by
multiplying the total amount of cash and the fair market value (on the date of
payment) of all other property paid or payable to the members of the
Shareholders Committee who become parties to this engagement letter in respect
of the shares of common stock held by them in connection with a transaction (the
applicable percentage will be based on the percentage premium of the transaction
value on a per-share basis over a base price of $35.375 (the closing price of
the common stock on November 26, 1999) and will vary from 0.25% for premiums to
the base price of 0% or less to 0.75% for premiums to the base price of 40% or
more); and (d) without duplication of the transaction fee, an additional fee
based on the value of any special dividend that is paid to the members of the
Shareholders Committee, and is not included in the value of any transaction for
which a fee is payable pursuant to clause (c). Amounts payable pursuant to
clauses (c) or (d) of the preceding sentence will be reduced, without
duplication, by any amounts previously paid under clauses (a) and (b) of the
preceding sentence. Under this engagement letter, Salomon Smith Barney is also
entitled to reimbursement of its reasonable expenses, including reasonable fees
and
-33-
<PAGE>
expenses of Salomon Smith Barney's legal counsel in connection with the
engagement of up to $10,000.
The members of the Shareholders Committee have also agreed to use reasonable
efforts, subject to the fiduciary duties of such persons, to cause Weis Markets
to retain Salomon Smith Barney as its exclusive financial advisor in connection
with a review of strategic alternatives and the execution thereof, for which
Salomon Smith Barney would be entitled to receive a normal and customary fee
from Weis Markets for such transaction in lieu of the payment by the members of
the Shareholders Committee of further fees under this engagement letter.
In addition to the foregoing, the Reporting Persons who are parties to the
Engagement Letter have also entered into a customary indemnification agreement
with Salomon Smith Barney in connection with Salomon Smith Barney's engagement.
The total costs incurred to date in connection with this solicitation are not in
excess of $[__________] and we expect that total costs incurred in connection
with this solicitation will not exceed $[__________]. If our nominees are
elected, we may ask Weis Markets to reimburse us for costs and expenses incurred
in connection with this solicitation. We do not intend to submit this request to
Weis Markets shareholders for their approval.
ADDITIONAL INFORMATION
The principal executive offices of Weis Markets are at 1000 South Second Street,
Sunbury, Pennsylvania 17801. Except as otherwise noted herein, the information
concerning Weis Markets has been taken from or is based upon documents and
records on file with the Securities and Exchange Commission and other publicly
available information. Although we do not have any knowledge that would indicate
that any statement contained herein based upon such documents and records is
untrue, we do not take any responsibility for the accuracy or completeness of
the information contained in such documents and records, or for any failure by
Weis Markets to disclose events that may affect the significance or accuracy of
such information.
-34-
<PAGE>
For information regarding the security ownership of certain beneficial owners
and the management of Weis Markets, see Annex IX.
Janet C. Weis
Susan Weis Mindel
Joel Mindel
Nancy Weis Wender
Ellen Weis Goldstein
Joseph I. Goldstein
Sidney Apfelbaum
Michael M. Apfelbaum
IF YOUR SHARES OF COMMON STOCK ARE HELD IN THE NAME OF A BROKERAGE FIRM, BANK,
BANK NOMINEE OR OTHER INSTITUTION, ONLY IT CAN SIGN A PROXY WITH RESPECT TO YOUR
COMMON STOCK. ACCORDINGLY, PLEASE CONTACT THE PERSON RESPONSIBLE FOR YOUR
ACCOUNT AND GIVE INSTRUCTIONS FOR A GOLD PROXY TO BE SIGNED REPRESENTING YOUR
SHARES OF COMMON STOCK.
IF YOU HAVE ANY QUESTIONS ABOUT GIVING YOUR PROXY OR REQUIRE ASSISTANCE, PLEASE
CONTACT MACKENZIE PARTNERS, INC. TOLL-FREE AT (800) 322-2885 OR CALL COLLECT AT
(212) 929-5500.
-35-
<PAGE>
ANNEX I
DIRECTOR REMOVAL RESOLUTION
RESOLVED, that the current Board of Directors be removed in its entirety,
including without limitation any of the following who are members of the
Board of Directors as of the Special Meeting: Robert F. Weis, Norman S.
Rich, William R. Mills, Jonathan H. Weis, Michael M. Apfelbaum, Joseph I.
Goldstein and Richard E. Shulman.
<PAGE>
ANNEX II
ELECTION OF DIRECTORS RESOLUTION
RESOLVED, that each of Michael M. Apfelbaum, John S. Furst, Joseph I. Goldstein
and Jeffrey E. Perelman be elected to fill four of the seven vacancies on the
Board of Directors resulting from the Director Removal Resolution for the
balance of the terms of the present directors and until their successors are
elected and qualified.
<PAGE>
ANNEX III
BOARD COMPOSITION RESOLUTION
RESOLVED, that the By-Laws of the Company be, and they hereby are, amended,
effective at the time this resolution is approved by the shareholders of the
Company, by adding the following after the last sentence of Section 4-01 of the
By-Laws:
No person who is an officer or employee of the Company shall be
appointed, or nominated for election, to the Board of Directors, and
no incumbent director shall become an officer or employee of the
Company (other than to the extent such person is deemed to be an
officer solely because such person is named Chairman of the Board of
Directors), if after giving effect to such nomination, appointment
or employment, a majority of the directors are persons who are or
would be officers or employees of the Company. The membership of the
Board of Directors shall reflect, as fully as possible, the
composition of the Company's shareholder base, including its
substantial shareholders, in proportion to the percentage of the
outstanding voting shares of the Company's capital stock held by
such shareholders. The Board of Directors may not amend or repeal
this Section or adopt any new By-Law provision that is inconsistent
in any manner with this Section.
<PAGE>
ANNEX IV
SHAREHOLDER VALUE RESOLUTION
RESOLVED, that the shareholders of the Company, hereby request that the Board of
Directors of the Company promptly (i) establish a committee of directors
representative of all shareholder interests to consider and evaluate the
strategic options available to the Company for maximizing shareholder value and
providing enhanced liquidity to shareholders, including through possible
business combination and merger transactions, and (ii) require that any and all
overtures (whether informal or formal) by any unaffiliated third parties
received by the Company or any of its officers or directors concerning such a
possible sale or merger are to be reported to the full Board of Directors of the
Company, that all such bona fide overtures should be explored in full and that
offers from any such persons should be solicited and not discouraged, with a
full report of such matters to be made to the shareholders of the Company.
<PAGE>
ANNEX V
BOARD SIZE RESOLUTION
RESOLVED, that the By-Laws of Weis Markets be and they hereby are amended,
effective at the time this resolution is approved by the shareholders of the
Company, by deleting the first two sentences of Section 4-01 in their entirety
and replacing them with the following sentence:
The business and affairs of the Company shall be managed and
controlled by a Board of Directors, which shall be fixed at seven
(7) members, who shall be persons of full age.
<PAGE>
ANNEX VI
BY-LAWS REPEAL RESOLUTION
RESOLVED, that any and all amendments made by the Board of Directors to the
By-Laws on or after November 30, 1999 be repealed, other than those provisions
that were duly approved by the shareholders of the Company, and that, without
the approval of the shareholders of the Company, the Board of Directors may not
thereafter amend any section of the By-Laws affected by such repeal or adopt any
new By-Law provision in a manner which serves to reinstate any repealed
provision or any similar provision.
<PAGE>
ANNEX VII
OMNIBUS RESOLUTION
RESOLVED, that each of the resolutions of the Proponents be voted upon by the
shareholders of the Company in the following order:
1. The Omnibus Resolution;
2. The By-Laws Repeal Resolution;
3. The Board Composition Resolution;
4. The Shareholder Value Resolution;
5. The Director Removal Resolution;
6. The Election of Directors Resolution;
and further, that, pursuant to Section 1765 of the Pennsylvania Business
Corporation Law and Section 3-11 of the Company's By-Laws, CT Corporation
System, and/or a representative thereof, be appointed as sole judge of election
at this meeting and that such judge of election shall, promptly following the
closing of the polls, make at this meeting a written report and execute a
certificate with respect to each resolution or other item of business considered
at this meeting, which report and certificate shall be made available for
inspection to each shareholder present at this meeting as promptly as
practicable following the casting of votes thereon, with respect to the number
of votes duly cast, in person of by proxy or otherwise, in favor or against, or
abstaining or withholding authority with respect to, each such resolution or
other items of business.
<PAGE>
ANNEX VIII
BENEFICIAL OWNERSHIP OF
SHARES BY PARTICIPANTS IN THE SOLICITATION
AND CERTAIN OTHER PERSONS
The principal business addresses of each of the members of the Shareholders
Committee and of Messrs. Furst and Perelman are set forth below.
NAME ADDRESS
- ------------------------------ ------------------------------------------------
Janet C. Weis................. c/o Michael M. Apfelbaum, Esq., Apfelbaum,
Apfelbaum & Apfelbaum, 43 South Fifth Street,
Sunbury, PA 17801
Michael M. Apfelbaum.......... Apfelbaum, Apfelbaum & Apfelbaum, 43 South
Fifth Street, Sunbury, PA 17801
Sidney Apfelbaum.............. Apfelbaum, Apfelbaum & Apfelbaum, 43 South
Fifth Street, Sunbury, PA 17801
Susan Weis Mindel............. c/o Michael M. Apfelbaum, Esq., Apfelbaum,
Apfelbaum & Apfelbaum, 43 South Fifth Street,
Sunbury, PA 17801
Joel Mindel................... c/o Michael M. Apfelbaum, Esq., Apfelbaum,
Apfelbaum & Apfelbaum, 43 South Fifth Street,
Sunbury, PA 17801
Nancy Weis Wender............. c/o Michael M. Apfelbaum, Esq., Apfelbaum,
Apfelbaum & Apfelbaum, 43 South Fifth Street,
Sunbury, PA 17801
Ellen Weis Goldstein.......... c/o Michael M. Apfelbaum, Esq., Apfelbaum,
Apfelbaum & Apfelbaum, 43 South Fifth Street,
Sunbury, PA 17801
Joseph I. Goldstein........... Kirkpatrick & Lockhart, LLP, 1800 Massachusetts
Avenue, N.W., Washington, DC 20036-1800
John S. Furst................. 190 Shady Shores Drive, Mabank, Texas
75147-9133
Jeffrey E. Perelman........... 1 Cherry Lane, Wynwood, Pennsylvania 19096
<PAGE>
As of the date of this proxy statement, the members of the Shareholders
Committee and Messrs. Furst and Perelman may be deemed to own beneficially (as
that term is defined in Rule 13d-3 under the Exchange Act, as amended) the
following number of shares of common stock of Weis Markets:
PERCENT OF
NAME SHARES OUTSTANDING*
- -------------------------------------- ----------- -------------
Janet C. Weis...................... 8,132,411(1) 19.5%
Michael M. Apfelbaum............... 3,809,009(2) 9.1
Sidney Apfelbaum................... 2,598,903(3) 6.2
Susan Weis Mindel.................. 3,490,216(4) 8.3
Joel Mindel........................ 12,150 0.03
Nancy Weis Wender.................. 3,381,463(5) 8.1
Ellen Weis Goldstein............... 3,473,761(6) 8.3
Joseph I. Goldstein................ 10,097 0.02
Shareholders Committee (in the 17,090,626 40.9
aggregate):........................
John S. Furst...................... 0 0
Jeffrey E. Perelman................ 0 0
(1) Includes 8,087,773 shares of common stock held by Weis Family Holdings,
L.P.
(2) Includes 3,781,945 shares held by the trusts under the Claire Gross Weis
Deed of Trust (the "Claire Weis Trusts") and 24,064 shares held by certain
Apfelbaum family trusts, each of which Michael M. Apfelbaum is co-trustee.
Michael M. Apfelbaum has shared voting and dispositive power over the shares
held in the Claire Weis Trusts, sole voting and dispositive power over 88 of
the shares, and sole voting and no dispositive power over 23,976 of the
shares, held in the Apfelbaum family trusts.
(3) Includes 2,408,526 shares held by the Charles Degenstein Charitable
Foundation, 82,364 shares held by the Lore Degenstein QTIP Trust,
- ----------
* Based on information regarding the total number of outstanding shares of
Company common stock set forth in Weis Markets' Quarterly Report on Form 10-Q
for the period ended September 25, 1999 of Weis Markets.
<PAGE>
65,520 shares held by the Lore Degenstein Charitable Remainder Unitrust,
7,500 shares held by the Zweifler Family Trust, 7,500 shares held by the
Walter Zweifler Trust and 3,000 shares held by the Jane Zweifler Trust, each
of which Sidney Apfelbaum is co-trustee. Sidney Apfelbaum has sole voting
and dispositive power over the 2,408,526 shares held by the Charles
Degenstein Charitable Foundation and shared voting and dispositive power
over the shares otherwise identified in this note 3.
(4) Includes 29,797 shares held by the Janet C. Weis 1997 Charitable Remainder
Unitrust, 28,600 shares held by the Janet C. Weis 1997 Charitable Lead
Unitrust, 26,184 shares held by the Janet C. Weis Grantor Retained Annuity
Trust #3, 43,081 held by the Janet C. Weis Grantor Retained Annuity Trust #4
(collectively, the "Janet Weis Trusts"), 1,512,778 shares held by certain of
the Claire Weis Trusts, 58,154 shares held by the Wendy Lynn Mindel 1998
Trust and 54,042 shares held by the Emily Beth Mindel 1998 Trust, each of
which Susan Weis Mindel is a co-trustee. Susan Weis Mindel has shared voting
and dispositive power over each of the shares identified in this note 4.
(5) Includes 29,797 shares held by the Janet C. Weis 1997 Charitable Remainder
Unitrust, 28,600 shares held by the Janet C. Weis 1997 Charitable Lead
Unitrust, 26,184 shares held by the Janet C. Weis Grantor Retained Annuity
Trust #3, 43,081 held by the Janet C. Weis Grantor Retained Annuity Trust #4
(collectively, the "Janet Weis Trusts"), and 1,512,778 shares held by
certain of the Claire Weis Trusts, each of which Nancy Weis Wender is a
co-trustee. Nancy Weis Wender has shared voting and dispositive power over
each of the shares identified in this note 5.
(6) Includes 29,797 shares held by the Janet C. Weis 1997 Charitable Remainder
Unitrust, 28,600 shares held by the Janet C. Weis 1997 Charitable Lead
Unitrust, 26,184 shares held by the Janet C. Weis Grantor Retained Annuity
Trust #3, 43,081 held by the Janet C. Weis Grantor Retained Annuity Trust #4
(collectively, the "Janet Weis Trusts"), 1,512,778 shares held by certain of
the Claire Weis Trusts, 58,154 shares held by the Laura Ann Goldstein 1999
Trust and 54,042 shares held by the Paul Weis Goldstein 1999 Trust, each of
which Ellen Weis Goldstein is a co-trustee. Ellen Weis Goldstein has shared
voting and dispositive power over each of the shares identified in this note
6.
<PAGE>
PRINCIPAL OCCUPATION OF PARTICIPANTS
The present principal occupation or employment and the name, principal business
and address of any corporation or other organization in which such employment is
carried on with respect to each participant is set forth below:
ORGANIZATION IN WHICH
SUCH EMPLOYMENT IS
PARTICIPANT PRINCIPAL EMPLOYMENT CARRIED OUT
- ---------------------- -------------------- ---------------------
Janet C. Weis Homemaker, Self-employed
Philanthropist and
Author
Susan Weis Mindel Consultant Self-employed
Joel S. Mindel Physician Self-employed
Nancy Weis Wender Clinical Counselor Self-employed
Ellen Weis Goldstein Student N/A
Joseph I. Goldstein Attorney Kirkpatrick & Lockhart, LLP
1800 Massachusetts Avenue,
N.W.
Washington, DC 20036
Sidney Apfelbaum Attorney Apfelbaum, Apfelbaum &
Apfelbaum
43 South Fifth Street
Sunbury, PA 17801
Michael M. Apfelbaum Attorney Apfelbaum, Apfelbaum &
Apfelbaum
43 South Fifth Street
Sunbury, PA 17801
John S. Furst Retired (formerly a N/A
certified public
accountant and partner
in Coopers & Lybrand)
Jeffrey E. Perelman Businessman and JEP Management, Inc.
Executive 625 Ridge Pike
Conshohocken, PA 19428
TRANSACTIONS IN WEIS MARKETS SECURITIES
The following members of the Shareholders' Committee have purchased or sold the
following shares of common stock of Weis Markets within the last two years:
<PAGE>
SHARES OF
COMMON STOCK PRICE
PARTICIPANT TRANSACTION DATE PURCHASED/SOLD PER SHARE
- ------------------ ---------------- -------------- ---------
Janet C. Weis .... 4/19/99 6,500 $35
Janet C. Weis .... 3/05/99 7,500 $36 3/8
In addition, Michael M. Apfelbaum and Joel S. Mindel have participated in the
Weis Markets Dividend Reinvestment Plan within the two years.
COMPENSATION OF DIRECTORS
Joseph I. Goldstein and Michael M. Apfelbaum are existing directors of Weis
Markets and receive, with respect to Weis Markets' 1999 fiscal year, an annual
retainer of $16,000 and an additional $1,000 for each regular meeting attended.
In addition, Messrs. Goldstein and Apfelbaum are members of the Board of
Director's Audit and Compensation Committees and receive $700 for each meeting
of such committee they attend.
CERTAIN RELATED TRANSACTIONS
Michael M. Apfelbaum is a partner in the law firm of Apfelbaum, Apfelbaum and
Apfelbaum; at the request of the management of Weis Markets, such firm provided
legal services to Weis Markets during 1999, the remuneration for which was not
material to such firm.
Central Properties, Inc., a Pennsylvania corporation, owns the land under a Weis
Markets store and an adjacent parking lot in Lebanon, Pennsylvania. Central
Properties leases these properties to Weis Markets for rent payments which
totaled $79,969 in 1998. The stockholders of Central Properties include Robert
F. Weis and family members of Michael M. Apfelbaum, Joseph I.
Goldstein and Jonathan H. Weis.
Except as otherwise set forth in this Annex VIII, no member of the Shareholders
Committee or nominee or any associate of any of the foregoing persons or any
other person who may be deemed a "participant" in this solicitation is or was
within the past year a party to any contract, arrangement or understanding with
any person with respect to any shares of common stock. There have not been any
transactions since the beginning of the last fiscal year of Weis Markets and
there is not any currently proposed transaction to which Weis Markets or any of
its subsidiaries was or is to be a party, in which the members of the
Shareholders Committee or any associate or immediate family member of any of the
foregoing persons or any other person who may be deemed a "participant" in this
solicitation had or will have a direct or indirect material interest. Other than
the directorships contemplated by the Special Meeting Proposals and compensation
<PAGE>
arrangements with Joseph I. Goldstein and Michael M. Apfelbaum in their
capacities as directors of Weis Markets, none of the members of the Shareholders
Committee or any associate of any of the foregoing persons or any other person
who may be deemed a "participant" in this solicitation has any arrangement or
understanding with any person with respect to any future employment by Weis
Markets or its affiliates, or with respect to any future transactions to which
Weis Markets or its affiliates may or will be a party.
In the ordinary course of its business, Salomon Smith Barney maintains customary
arrangements and may effect transactions in the securities of Weis Markets for
the accounts of its customers. As of November 29, 1999, Salomon Smith Barney did
not beneficially own any common stock, and held of record 365,667 shares of Weis
Markets common stock for customer accounts.
<PAGE>
ANNEX IX
SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth share ownership information with respect to
persons known to be beneficial owners of more than 5% of the shares of common
stock of Weis Markets. With respect to Robert F. Weis and Ellen W.P. Wasserman,
and Mellon Financial Corporation (insofar as such information relates to the
Will of Harry Weis as described in note 6 below), such information is presented
as it was set forth in the 1999 Proxy Statement of Weis Markets. With respect to
the Shareholders Committee and its members, and Mellon Financial Corporation as
co-trustee of certain trusts or foundations related to members of the
Shareholders Committee, such information is as of November 29, 1999. Unless
otherwise indicated, each of the shareholders has sole voting and investment
power with respect to the shares of common stock of Weis Markets beneficially
owned.
NUMBER
OF SHARES PERCENT
BENEFICIALLY OF CLASS
NAME AND ADDRESS OF BENEFICIAL OWNER OWNED (1) (3)
- ----------------------------------------- ------------ --------
Shareholders Committee (in the aggregate) 17,090,626 40.9%
(2)...................................
c/o Michael M. Apfelbaum
Apfelbaum, Apfelbaum and Apfelbaum
43 South Fifth Street
Sunbury, PA 17801
Robert F. Weis .......................... 12,764,142 (4) 30.6
c/o Weis Markets, Inc. (6)
1000 South Second Street
Sunbury, PA 17801-0471
Ellen W.P. Wasserman .................... 3,584,424 (5) 8.6
c/o Weis Markets, Inc.
1000 South Second Street
Sunbury, PA 17801-0471
Mellon Financial Corporation............. 10,431,032 (6) 25.0
One Mellon Bank Center
Pittsburgh, PA 15258
- -----------
(1) For purposes of this table, a person is deemed to have "beneficial
ownership" of any security that such person (a) has or shares "voting
power", which includes the power to dispose of, or to direct the
disposition of, such security or (b) has the right to acquire within 60
days
<PAGE>
after the date such information was set forth in the 1999 Proxy
Statement of Weis Markets, and November 29, 1999 with respect to the
beneficial ownership of the Shareholders Committee. More than one
person may be deemed to be a beneficial owner of the same securities,
and a person may be deemed to be a beneficial owner of securities as to
which he has no beneficial interest.
(2) Includes shares which may be deemed to be beneficially owned by members
of the Shareholders Committee as a "group" as such term is used in
Section 13(d)(3) of the Securities Exchange Act of 1934 (the "Exchange
Act"). Additional information regarding the holdings by members of the
Shareholders Committee is set forth on the Schedule 13D (and amendments
thereto) filed with the Securities and Exchange Commission on November
30, 1999.
(3) Based on 41,690,125 shares outstanding on September 25, 1999 as disclosed
by Weis Markets in its Quarterly Report on Form 10-Q for the quarter then
ended.
(4) Of the total 12,764,142 shares listed, Robert F. Weis has sole voting and
investment power as to all. This amount includes 6,649,087 shares held in
trust under the Will of Harry Weis, with Mellon Financial Corporation and
Robert F. Weis as co-trustees.
(5) Of the total 3,584,424 shares listed, Ellen W. P. Wasserman has sole voting
and investment power as to all.
(6) Includes 6,649,087 shares held in trust under the Will of Harry Weis, with
Mellon Financial Corporation and Robert F. Weis as co-trustees (note 4),
3,781,945 shares held in the Claire Weis Trusts as co-trustee and 2,408,526
shares held by the Charles B. Degenstein Foundation, with Mellon Financial
Corporation and Sidney Apfelbaum as co-trustees (note 2).
<PAGE>
The following table sets forth, as stated in the 1999 Proxy Statement of Weis
Markets (except as otherwise noted below), the name of, and the total number of
shares of common stock (if any) beneficially owned (as defined in Rule 13d-3
under the Exchange Act) and the percentage of outstanding shares of common stock
beneficially owned by, (a) each director of Weis Markets, (b) the Chairman of
the Board and each of the executive officers of Weis Markets and (c) all
directors and officers as a group. The information presented below has been
taken from or is based upon documents and records on file with the Securities
and Exchange Commission and other publicly available information. Since the 1999
Proxy Statement of Weis Markets, the total outstanding number of shares of
common stock has increased to 41,690,125 (based on information provided in the
Quarterly Report on Form 10-Q for the quarter ended September 25, 1999 of Weis
Markets). Although we do not have any knowledge that would indicate that any
statement contained herein based upon such documents and records is untrue, we
do not take any responsibility for the accuracy or completeness of the
information contained in such documents and records, or for any failure by Weis
Markets to disclose events that may affect the significance or accuracy of such
information.
SHARES OF STOCK
OF THE
CORPORATION PERCENT
BENEFICIALLY OWNED OF
NAME ON FEBRUARY 5, 1999 CLASS
- ----------------------------- ------------------- -------
Robert F. Weis............... 12,764,142 30.6%
Norman S. Rich............... 22,373 *
William R. Mills............. 2,000 *
Jonathan H. Weis............. 87,563 *
Michael M. Apfelbaum......... 6,771,863 (1) 16.2
Joseph I. Goldstein.......... 10,097 *
Richard E. Shulman........... 216 *
All 14 Directors and
Officers as a Group........ 19,710,770 47.2
- -----------
* Less than 1%.
(1) Including 1,717,705 shares held in the Residuary Trust of Sigmund Weis,
3,798,427 shares held in the Claire G. Weis Deed of Trust and 1,228,798
shares held in the Residuary Trust of Clare Elizabeth Degenstein. For
information regarding the number of shares that may
<PAGE>
be deemed to be beneficially owned by Michael M. Apfelbaum, updated to
November 30, 1999, see Annex VIII.
<PAGE>
ANNEX X
PRESS RELEASE
ISSUED NOVEMBER 30, 1999
WEIS MARKETS SHAREHOLDERS COMMITTEE
NEWS RELEASE
FOR IMMEDIATE RELEASE Contact: Donald W. Schuster
The Torrenzano Group
(212) 681-1700 ext.103
MEMBERS OF WEIS FAMILY FILE 13-D SEEKING ENHANCED
SHAREHOLDER VALUE FOR SHARES OF WEIS MARKETS, INC.
SUNBURY, PA, November 30 -- Certain members of the Weis family and related
trusts and foundations (the Shareholders Committee) holding approximately 41% of
the outstanding shares of Weis Markets, Inc. (NYSE: WMK) filed a Schedule 13D/A
today seeking enhanced shareholder value and increased liquidity for all shares
of Weis Markets.
The Shareholders Committee has called upon the Company to change the composition
of its Board of Directors to better represent all members of the Weis family and
the entire shareholder base and to establish a special committee of directors to
evaluate the strategic options that may be available to the Company for
maximizing shareholder value, including through possible business combination
and merger transactions.
Members of the Shareholders Committee have also delivered a notice pursuant to
the Company's by-laws requesting that the Company call a special meeting of its
shareholders to consider the election of a reconstituted slate of directors
containing additional independent directors and to vote upon certain by-law
proposals relating to their stated platform. The Shareholders Committee is
filing a preliminary proxy statement today with the Securities and Exchange
Commission relating to the proposed special meeting.
John S. Furst and Jeffrey E. Perelman have agreed to serve as directors of the
Company in connection with such an election. John S. Furst has significant
corporate experience and is a certified public accountant who spent 25 years as
a partner at Coopers & Lybrand until 1993 and continues to serve as a senior
officer of several companies. Mr. Perelman is a Pennsylvania executive and
businessman with extensive experience as the chief executive officer of a number
of domestic and European companies and is active in various philanthropic
endeavors.
<PAGE>
The Shareholders Committee said that it has recently engaged Salomon Smith
Barney to act as its financial advisor and to assist it in obtaining increased
liquidity and value for the shares owned by its members. Based upon advice
received from Salomon Smith Barney, the Shareholders Committee believes that the
value that shareholders could receive in a sale or merger transaction involving
the Company is likely to be substantially in excess of the current trading range
of the Common Stock and that there would likely be strong interest by potential
acquirers in the Company. Salomon Smith Barney has advised the Shareholders
Committee that, based upon its preliminary analysis of the Company using only
publicly available information, and without having conducted any solicitation of
third-party interest and relying upon recent merger and acquisition precedents
in the retail grocery industry, it believes that a per share acquisition price
in the range of $45 to $55 should reasonably be obtainable by the Company in the
current market environment.
The Shareholders Committee also indicated that it believes that the Company's
strong balance sheet (free of debt and including approximately $400 million in
cash and marketable securities on hand) can be used to provide shareholders with
tangible short-term value - without adversely affecting the Company's previously
announced capital investment program - in the event such a sales process is not
consummated.
The Shareholders Committee has hired MacKenzie Partners, Inc. to aid in their
shareholder communications program.
The Shareholders Committee indicated that, while its members remained hopeful
that an amicable resolution can be reached with the majority of the members of
the Board, it is prepared to pursue a protracted process, if necessary, to
accomplish its desired goals on behalf of all shareholders. Two of the Company's
seven directors are presently affiliated with the Shareholders Committee.
Speaking on behalf of the family members, Janet Weis, wife of the late Sigfried
Weis, former Chairman and President of Weis Markets, stated: "Weis Markets has
been a family institution for 88 years and we are all proud of its great
heritage. Robert Weis, Norm Rich and the other members of management have done a
fine job running the Company day-to-day in recent years. It is now time,
however, for all of us, together, to pursue a change in the best interests of
the employees, public shareholders and the family. Holders of a significant
majority of the Weis Markets shares no longer participate in the day-to-day
management of the Company. We believe that it is time for the Company to chart a
new course and to ensure that all shareholders - as well as employees and the
community -- are treated fairly in that process."
<PAGE>
Sidney Apfelbaum, a long-time family friend and a trustee of a number of family
trusts and a family charitable foundation, added: "The situation to which we
respond today has been building for many years. As competitive conditions in the
industry continue to undergo dramatic change, we are all firmly united in our
belief that now is the right time for us to seek a strategic partner for Weis
Markets before industry developments pass us by.
"We are confident there is strong interest in the Weis Markets franchise and
that a strategic merger or acquisition of Weis Markets can be accomplished in a
manner attractive to all Weis Markets constituencies. I have lived in Sunbury
since 1923 and I have a strong friendship and professional association with Weis
Markets and all members of the Weis family going back a very long way. I am
particularly proud of the good works and contributions of the Weis and
Degenstein families that have helped build so many of our local institutions.
Janet Weis and the other members of her family have my full support in their
efforts to see that a fair and fitting next chapter to this great story is
written in the best interests of all of the members of the younger Weis
generations, the Weis Markets employees, Sunbury and all the communities that
the company serves."
Weis Markets, Inc. is based in Sunbury, Pennsylvania and operates approximately
164 stores in six states: Pennsylvania, Maryland, New Jersey, New York, Virginia
and West Virginia. The company was founded in 1912 by brothers Harry Weis and
Sigmund Weis. Weis Markets conducted its initial public offering in 1965.
Sigmund Weis's son, the late Sigfried Weis, was a member of the company's Board
of Directors from 1947 until 1995, became President of the Company in 1961 and
was Janet Weis's husband.
The Shareholders Committee is comprised of Janet C. Weis and descendants of
Janet and Sigfried Weis and their families, a family partnership and the
trustees of family trusts and foundations, including Michael M. Apfelbaum and
Joseph I. Goldstein, who also serve as directors of Weis Markets.
<PAGE>
PRELIMINARY COPY
(FRONT OF PROXY CARD)
PROXY SOLICITATION
WEIS MARKETS, INC.
THIS REVOCABLE PROXY IS SOLICITED BY
THE SHAREHOLDERS COMMITTEE
The undersigned shareholder of Weis Markets, Inc. (the "Company") hereby
appoints [___________________________________________________], and each of
them, with full power of substitution and resubstitution, the proxies of each of
the undersigned (said proxies, together with each substitute appointed by any of
them, if any, collectively the "Proxies"), to vote all shares of common stock of
Weis Markets, no par value, that the undersigned is entitled to vote if
personally present at the Special Meeting of shareholders of Weis Markets to be
held on [____________________] at [___________] local time at [______________
______________________] and at any adjournment or postponement thereof (the
"Special Meeting"). The undersigned hereby revokes any previous proxies with
respect to the matters covered by this Proxy.
THE SHAREHOLDERS COMMITTEE RECOMMENDS A VOTE "FOR" EACH OF THE PROPOSALS SET
FORTH BELOW.
(Please mark each proposal with an "X" in the appropriate box)
1. To remove the current Board of Directors in its entirety, including
without limitation, any of the following who are members of the Board of
Directors as of the Special Meeting: Robert F. Weis, Norman S. Rich,
William R. Mills, Jonathon H. Weis, Michael M. Apfelbaum, Joseph I.
Goldstein and Richard E. Shulman (the "Director Removal Resolution").
[_] FOR [_] AGAINST [_] ABSTAIN
2. To have elected Michael M. Apfelbaum, John S. Furst, Joseph I. Goldstein
and Jeffrey E. Perelman, (the "Nominees") to fill four of the seven
vacancies on the Board of Directors for the balance of the terms of the
current directors and until their successors are duly elected and
qualified. The Election of Directors Resolution will only be considered if
the Director Removal Resolution is approved by the required shareholder
vote.
<PAGE>
[_] FOR [_] WITHHOLD AUTHORITY
all nominees for all nominees
(INSTRUCTION: To withhold authority to vote for one or more nominees, mark
FOR above and print the name(s) of the person(s) with respect to whom you
wish to withhold authority in the space provided below.)
-------------------------------------------------------------------
The proxies are authorized to allocate all votes that the undersigned is
entitled to cast in the election of directors equally among the nominees
(other than nominees with respect to whom authority is withheld).
3. To amend the By-Laws to provide that a majority of the members of the
Board of Directors shall consist of persons who are not employees of Weis
Markets, and shall reflect the composition of Weis Markets' shareholder
base (the "Board Composition Resolution").
[_] FOR [_] AGAINST [_] ABSTAIN
4. To request that the Board of Directors establish a special committee of
directors to consider and evaluate the strategic options available to
Weis Markets for maximizing shareholder value and providing enhanced
liquidity to shareholders, including through possible business
combinations and merger transactions, and report any overtures from
such third parties that may be received to the Board of Directors and
the shareholders of Weis Markets and that such overtures be fully
explored (the "Shareholder Value Resolution").
[_] FOR [_] AGAINST [_] ABSTAIN
5. To amend the By-Laws to set the size of the Board of Directors at seven
(the "Board Size Resolution").
[_] FOR [_] AGAINST [_] ABSTAIN
6. To repeal any and all amendments made by the Board of Directors to the
By-Laws after November 30, 1999, other than amendments that were duly
approved by the shareholders of Weis Markets, and to
<PAGE>
provide that, without approval of the shareholders of Weis Markets, the
Board of Directors may not thereafter amend any section of the By-Laws
affected by such repeal or adopt any new By-Law provision that would serve
to reinstate any repealed provision or any similar provision (the "By-Laws
Repeal Resolution").
[_] FOR [_] AGAINST [_] ABSTAIN
7. To set forth the following order in which the Special Meeting Proposals
will be voted on by the shareholders of Weis Markets, and to specify that
CT Corporation System be appointed the sole judge of election:
1. The Omnibus Resolution;
2. The Election Procedures Resolution;
3. The By-Laws Repeal Resolution;
4. The Board Composition Resolution;
5. The shareholder Value Resolution;
6. The Director Removal Resolution; and
7. The Election of Directors Resolution.
(the "Omnibus Resolution")
This proxy, when properly executed, will be voted in the manner marked herein by
the undersigned shareholder. IF NO MARKING IS MADE, THIS PROXY WILL BE DEEMED TO
BE A DIRECTION TO VOTE FOR THE FOREGOING PROPOSALS IN THEIR ENTIRETY. THE
SHAREHOLDERS COMMITTEE STRONGLY RECOMMENDS THAT YOU VOTE "FOR" EACH OF THE
PROPOSALS.
<PAGE>
(BACK OF REQUEST CARD)
Dated: _____________, 2000
Signature ______________________
Signature (if jointly held) _______________________
Title:
Please sign exactly as your name appears on your stock certificate. When shares
are held by joint tenants, both should sign. When signing as an attorney,
executor, administrator, trustee or guardian, give full title as such. If a
corporation, sign in full corporate name by president or other authorized
officer. If a partnership, sign in partnership name by authorized person. PLEASE
SIGN, DATE AND MAIL PROMPTLY IN THE POSTAGE-PAID ENCLOSED ENVELOPE.
