<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
ARDEN GROUP, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
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):
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / 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:
------------------------------------------------------------------------
<PAGE>
[Logo] ARDEN GROUP, INC.
2020 SOUTH CENTRAL AVENUE
COMPTON, CALIFORNIA 90220
(310) 638-2842
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
JUNE 27, 1995
NOTICE IS HEREBY GIVEN that the Annual Meeting of the Stockholders of Arden
Group, Inc. (the "Company") will be held at The Beverly Hilton Hotel, Wilshire
Room in the Executive Center, 9876 Wilshire Boulevard, Beverly Hills,
California, on June 27, 1995, at 10:00 a.m., Los Angeles Time, for the
following purposes:
1. To elect three directors for a term of three years each;
2. To ratify the selection of independent certified public accountants
for the 1995 fiscal year; and
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The close of business on May 5, 1995, has been fixed as the record date for
the determination of stockholders entitled to notice of and to vote at the
meeting. A list of such stockholders will be available for examination by any
stockholder at the meeting and, for 10 days prior to the meeting, during
ordinary business hours at Arden Group, Inc., 9595 Wilshire Boulevard, Suite
411, Beverly Hills, California.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING IN PERSON, YOU ARE URGED TO
FILL IN, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED, POSTAGE
PREPAID ENVELOPE. THE RETURN OF YOUR PROXY WILL NOT PRECLUDE YOU FROM VOTING IN
PERSON IF YOU CHOOSE TO ATTEND THE MEETING.
By Order of the Board of Directors
/s/
---------------------------
Assistant Secretary
May 31, 1995
PROMPT RETURN OF PROXIES WILL SAVE THE EXPENSE INVOLVED
IN FURTHER COMMUNICATION
<PAGE>
[Logo] ARDEN GROUP, INC.
2020 SOUTH CENTRAL AVENUE
COMPTON, CALIFORNIA 90220
ANNUAL MEETING OF STOCKHOLDERS
ON JUNE 27, 1995
PROXY STATEMENT
GENERAL
This Proxy Statement is furnished by the Board of Directors of Arden Group,
Inc. (the "Company") in connection with its solicitation for use at the Annual
Meeting of Stockholders (the "Meeting") to be held at The Beverly Hilton Hotel,
Wilshire Room in the Executive Center, 9876 Wilshire Boulevard, Beverly Hills,
California, on June 27, 1995, at 10:00 a.m. Los Angeles Time, and at any
adjournment thereof. The approximate date on which this Proxy Statement and the
accompanying forms of proxy will first be sent to stockholders is May 31, 1995.
All shares represented by each properly executed and unrevoked proxy
received in time for the Meeting will be voted as specified, or, if no
specification is made, for (i) the election as directors of management's
nominees; and (ii) the ratification of the selection of independent certified
public accountants. The Company does not know of any other business that will
be presented for action at the Meeting, but if any matter is properly presented,
the persons named in the accompanying proxies will vote thereon in accordance
with their judgment. A proxy may be revoked at any time prior to its exercise
by filing a written notice of revocation with an Assistant Secretary of the
Company, by timely delivery of a later proxy or by voting in person at the
Meeting contrary to the manner in which the proxy is to be voted.
The cost of soliciting proxies will be paid by the Company. Arrangements
will be made with brokerage houses and other custodians, nominees and
fiduciaries to forward proxy material to the beneficial owners of stock of the
Company and such persons will be reimbursed for their reasonable expenses.
Proxies may be solicited by directors, officers or employees of the Company and
its subsidiaries in person or by telephone or telegraph, for which such persons
will receive no special compensation. In addition, Beacon Hill Partners, Inc.
("Beacon Hill") has been retained by the Company to aid in the solicitation of
proxies from banks, brokers and nominees and will solicit such proxies by mail,
telephone, telegraph and personal interview, and request brokerage houses and
nominees to forward soliciting material to beneficial owners of the Company's
stock. For these services, Beacon Hill will be paid a fee of $2,500 plus
expenses.
RECORD DATE; SHARES ENTITLED TO VOTE; QUORUM
The Board has fixed the close of business on May 5, 1995, as the record
date for the determination of holders of Class A Common Stock and Class B Common
Stock entitled to notice of and to vote at the Meeting. Accordingly, only
holders of shares of Class A Common Stock and Class B Common Stock of record at
the close of business on such date will be entitled to vote such shares at the
Meeting. At the close of business on May 5, 1995, there were outstanding
970,866 shares of Class A Common Stock and 343,246 shares of Class B Common
Stock. Each share of Class A Common Stock will entitle the holder thereof to
one vote on all matters described in this Proxy Statement and all other matters
which could be properly brought before the Meeting. Each share of Class B
Common Stock will entitle the holder thereof to 10 votes on all matters
described in this Proxy Statement and most other matters which could be properly
brought before the Meeting. As of May 5, 1995, there were approximately 1,830
holders of record of Class A Common Stock and 13 holders of record of Class B
Common Stock. The presence, either in person or by properly executed proxy, of
both (i) stockholders holding of record a number of shares of Class A Common
Stock entitling them to exercise a majority of the voting power of such class of
stock and (ii) stockholders holding of record a number of shares of Class B
Common Stock entitling them to exercise a majority of the voting power of such
class of stock is necessary to constitute a quorum at the Meeting.
1
<PAGE>
PRINCIPAL STOCKHOLDERS
As of May 12, 1995, the only persons known to the Company to own
beneficially more than 5% of the then outstanding shares of Class A Common Stock
or Class B Common Stock were the following:
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT
TITLE OF CLASS NAME AND ADDRESS OF BENEFICIAL OWNER OWNERSHIP (1) OF CLASS (1)
- -------------- ------------------------------------ ---------- --------
<S> <C> <C> <C>
Class A Common Stock City National Bank, as Trustee 235,967(2) 24.3%
of the Company's Stock Bonus Plan and Trust
(the "Stock Bonus Plan")
120 South Spalding Drive
Beverly Hills, CA 90213
Class A Common Stock Bernard Briskin 145,007(3) 15.0%
Arden Group, Inc.
9595 Wilshire Blvd., Suite 411
Beverly Hills, CA 90212
Class A Common Stock Southeastern Asset Management, Inc. 165,229(4) 17.0%
860 Ridgelake Blvd., Suite 301
Memphis, TN 38120
Class A Common Stock Lazard Freres & Co.
One Rockefeller Plaza
New York, NY 10020 55,300(5) 5.7%
Class B Common Stock Bernard Briskin 340,624 99.2%
<FN>
____________________________
(1) Unless otherwise indicated to the contrary, all beneficial owners have
sole investment and voting power. For purposes of this table, 339,300
shares of Company Class A Common Stock which are held by AMG Holdings,
Inc., an indirect wholly owned subsidiary of the Company, are not
deemed to be outstanding.
(2) This amount includes the shares stated in note (3) below to be held
for the account of Mr. Briskin in the Company Stock Bonus Plan, for
which City National Bank acts as Trustee. City National Bank ("CNB"),
as trustee of the Company Stock Bonus Plan, is required to take all
action authorized or permitted by a beneficial owner of all securities
owned by the trust created under such plan, including voting on or
consenting (or withholding consent) to all matters or actions
requiring or permitting a vote of the security holders. If, however,
CNB has knowledge of any contested solicitation of votes or consents,
then CNB will vote or otherwise act with respect to such contested
matter pursuant to instructions from each participant in such plan
(or, if deceased, the beneficiary thereof) to whom securities have
been allocated. Any undirected allocated securities and any
unallocated securities shall be voted for and against the action being
voted or acted upon in the same ratio that responding participants
have directed CNB to vote or act on such action.
(3) This amount includes the following shares: (i) 54,199 shares owned by
Mr. Briskin's wife; (ii) 46,524 shares held in trust (of which Mr.
Briskin is a trustee) for the benefit of Mr. Briskin, his children and
his mother; and (iii) 11,262 shares held in the Company Stock Bonus
Plan for the account of Mr. Briskin. Mr. Briskin disclaims any
beneficial ownership of the shares set forth in clause (i) hereof.
Mr. Briskin shares voting and investment power with respect to the
shares referred to in clause (ii), and shares voting power but has no
investment power with respect to the shares set forth in clause
(iii). Nothing herein should be construed as an admission that Mr.
Briskin is in fact the beneficial owner of any of these shares.
(4) Based upon information contained in Amendment No. 4 to Schedule 13G
dated February 13, 1995 filed with the Securities and Exchange
Commission by Southeastern Asset Management, Inc.
(5) Based upon information contained in Amendment No. 5 to Schedule 13G
dated February 14, 1995 filed with the Securities and Exchange
Commission by Lazard Freres & Co.
</TABLE>
2
<PAGE>
ELECTION OF DIRECTORS
As permitted under the General Corporation Law of the State of Delaware,
the state in which the Company is incorporated, the Company's Certificate of
Incorporation provides for a classified Board of Directors, with approximately
one-third of the total authorized number of directors elected each year for a
term of three years by straight (as distinguished from cumulative) voting.
At the Meeting, it is proposed to elect the three nominees shown below to
hold office as directors until the Company's Annual Meeting in 1998 or until
such directors' successors have been elected and qualified. Each nominee,
except Mr. Danhakl, is now a director of the Company.
Under Article Fourth of the Certificate of Incorporation of the Company, so
long as the total number of outstanding shares of Class B Common Stock is equal
to or greater than 12.5% of the total aggregate number of outstanding shares of
Class A Common Stock and Class B Common Stock, the holders of Class A Common
Stock are entitled to elect at any meeting therefor only such number of
directors as, when added to the number of continuing directors previously
elected by the holders of Class A Common Stock, equals 25% of the total number
of directors of the Company (rounded up to the nearest whole number); the
remaining directors are to be elected by the holders of the Class B Common
Stock.
Pursuant to the terms of the Company's Certificate of Incorporation, the
holders of Class A Common Stock are entitled to elect one director at the
Meeting and will have one vote per share for the election of such director. The
holders of Class B Common Stock are entitled to elect two directors at the
Meeting and will have 10 votes per share for each director to be elected by such
stockholders. In each case, the election of the director or directors requires
the affirmative vote of the holders of a plurality of the shares of such class
of stock present, in person or by proxy, and entitled to vote at the Meeting.
Any votes against a nominee or withheld from voting (whether by abstention,
broker non-votes or otherwise) will not be counted and will have no effect on
the vote with respect to the election of directors.
The Board of Directors recommends a vote FOR the election of each of the
three nominees whose names are shown below.
Management is not aware of any circumstance that would render any nominee
unable to serve. However, if any nominee should unexpectedly become unavailable
for election, votes will be cast, pursuant to the accompanying proxies, for the
election of a substitute nominee or nominees who may be selected by the present
Board of Directors.
Below is set forth certain information concerning each of the three
nominees and the four continuing directors as of May 12, 1995. Certain of this
information has been supplied by the persons named:
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DIRECTOR TERM
NAME AGE AND OTHER DIRECTORSHIPS (1) SINCE EXPIRES
----- ---- --------------------------- -------- -------
NOMINEES FOR ELECTION BY CLASS A COMMON STOCKHOLDERS
FOR A THREE-YEAR TERM ENDING IN 1998:
<S> <C> <C> <C> <C>
Daniel Lembark 70 Financial consultant and 1978 1995
Certified Public Accountant
</TABLE>
3
<PAGE>
NOMINEES FOR ELECTION BY CLASS B COMMON STOCKHOLDERS
FOR A THREE-YEAR TERM ENDING IN 1998:
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DIRECTOR TERM
NAME AGE AND OTHER DIRECTORSHIPS (1) SINCE EXPIRES
---- --- ---------------------------- ------ -------
<S> <C> <C> <C> <C>
Bernard Briskin 70 Chairman of the Board of Directors, President 1970 1995
and Chief Executive Officer of the Company
and Arden-Mayfair, Inc., a subsidiary of the
Company, and Chairman of the Board of AMG
Holdings, Inc. and Gelson's Markets, both
subsidiaries of Arden-Mayfair.
John G. Danhakl 39 Managing Director of Donaldson Lufkin
Jenrette Securities Corporation from March
1990 to February 1995. Managing Director of
Leonard Green & Partners from March 1995 to
present.
</TABLE>
Curtis H. Palmer, Chairman of the Board since 1976, did not stand for re-
election as a Director. Mr. Danhakl has been nominated by the Board to succeed
him.
<TABLE>
<CAPTION>
CONTINUING DIRECTORS: (2)
<S> <C> <C> <C> <C>
Robert A. Davidow 53 Director of WHX Corporation since January 1993 1996
1991; private investor.
Stuart A. Krieger 77 Business Consultant. 1978 1997
Director of American Rocket Co.
Frederick A. Schnell 84 President (retired), Western Operations, The 1975 1996
Prudential Insurance Company of America.
Ben Winters 74 Business Consultant. 1978 1997
<FN>
_________________________
(1) Unless otherwise indicated, principal occupation or occupations shown
have been such for a period of at least five years in the aggregate.
(2) Date shown for term of service indicates commencement of service as a
director of the Company or Arden-Mayfair.
</TABLE>
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Company has audit, nominating, investment and compensation committees.
Current members of the audit committee are Mr. Schnell, chairman, and Messrs.
Lembark and Winters. This committee, which monitors significant accounting
policies, approves services rendered by the independent auditors, reviews audit
and management reports and makes recommendations regarding the appointment of
independent auditors and the fees payable for their services, met 3 times in
1994. Current members of the Compensation Committee are Mr. Lembark, chairman,
and Messrs. Davidow, Schnell and Winters. This committee, which considers and
makes recommendations as to salary and incentive compensation awards to senior
executive officers, met 5 times in 1994. Current members of the investment
committee are Mr. Davidow, chairman, and Messrs. Briskin and Winters. This
committee defines the short term investment strategy for the Company and met 5
times in 1994. Current members of the nominating committee are Mr. Winters,
chairman, and Messrs. Briskin, Krieger and Schnell. This committee, which was
established to select candidates for nomination and election as directors, met
once in 1994. The nominating committee will consider qualified nominees
recommended by stockholders. Stockholders who wish to recommend qualified
nominees should write to an Assistant Secretary of the Company at 2020 South
Central Avenue, Compton, California 90220, and should state the qualifications
of persons proposed by them.
4
<PAGE>
During the 1994 fiscal year, the Board of Directors held 11 meetings. Each
of the directors (except Mr. Palmer) attended over 75% of the aggregate of all
of the meetings of the Board of Directors and meetings held by all committees of
the Board on which he served during such period.
COMPENSATION OF DIRECTORS
During 1994, each non-employee director of the Company was compensated for
all services as a director at an annual rate of $12,000 plus $750 for each Board
meeting attended and $750 for attendance at each committee meeting. Non-
employee directors who serve as committee chairmen are entitled to an additional
$3,000 per year. Messrs. Briskin and Palmer are employees of the Company and do
not receive the compensation otherwise payable to directors.
BENEFICIAL OWNERSHIP OF THE COMPANY'S STOCK BY MANAGEMENT
The following table shows, as of May 12, 1995, the beneficial ownership of
the Company's equity securities by each director or nominee, Ernest T. Klinger,
CFO, VP Finance and Administration, and by all directors and officers as a
group.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
TITLE OF CLASS BENEFICIAL PERCENT
NAME OF COMPANY'S STOCK OWNERSHIP(1) OF CLASS(1)
---- ------------------ ------------ -----------
<S> <C> <C> <C>
Bernard Briskin . . . . . . . . . . . . . Class A Common Stock 145,007(2)(3) 15.0%
Class B Common Stock 340,624 99.2%
Robert A. Davidow . . . . . . . . . . . . . . Class A Common Stock --
John G. Danhakl . . . . . . . . . . . . . . Class A Common Stock --
Stuart A. Krieger . . . . . . . . . . . . . . Class A Common Stock --
Daniel Lembark . . . . . . . . . . . . . . Class A Common Stock --
Curtis H. Palmer . . . . . . . . . . . . . . Class A Common Stock 212(3)(4)
Frederick A. Schnell . . . . . . . . . . . . . Class A Common Stock --
Ben Winters . . . . . . . . . . . . . Class A Common Stock 100(2)(4)
Ernest T. Klinger . . . . . . . . . . . . . Class A Common Stock 325(3)(4)
All directors and executive officers as a group
(9 persons) . . . . . . . . . . . . . Class A Common Stock 156,611(3) 16.1%
Class B Common Stock 340,624 99.2%
<FN>
__________________________
(1) Unless otherwise indicated to the contrary, all beneficial owners have
sole investment and voting power. The number of outstanding shares of
Company Class A Common Stock on which the percentages shown in this
table are based does not include 339,300 shares of Company Class A
Common Stock held by AMG Holdings, Inc.
(2) See notes (2) and (3) to the table under "Principal Stockholders" set
forth above.
(3) Includes shares held in the Company Stock Bonus Plan for the accounts
of the named individuals.
(4) Did not exceed 1% of the outstanding shares of the class.
</TABLE>
5
<PAGE>
EXECUTIVE OFFICERS OF THE COMPANY
Set forth below is certain information regarding the persons who presently
serve as executive officers of the Company.
<TABLE>
<CAPTION>
NAME AGE POSITIONS AT THE COMPANY(1)
---- --- --------------------------
<S> <C> <C>
Bernard Briskin 70 Chairman of the Board, President and Chief
Executive Officer of the Company.
Ernest T. Klinger 59 Vice President Finance and Administration and
Chief Financial Officer of the Company.
Milton H. Barker 77 Vice President of the Company.
<FN>
_________________________
(1) Unless otherwise indicated, principal occupation or occupations shown
have been such for a period of least five years in the aggregate.
</TABLE>
Executive officers of the Company are elected annually by the Company
Board and serve at the discretion of the Company Board, with the exception of
Mr. Briskin, who has an employment agreement. See "Employment Agreement -
Bernard Briskin."
EXECUTIVE COMPENSATION AND RELATED INFORMATION
GENERAL. The following table sets forth the total annual and long-term
compensation paid or accrued by the Company and its subsidiaries in connection
with all businesses of the Company and its subsidiaries to or for the account of
the Chief Executive Officer of the Company and each other executive officer of
the Company whose total annual salary and bonus for the fiscal year ended
December 31, 1994 exceeded in the aggregate $100,000.
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
------------------------------------
AWARDS PAYOUTS
----------------------- ----------
ANNUAL COMPENSATION SECURITIES-
------------------------------------------------- RESTRICTED UNDERLYING
OTHER STOCK OPTIONS/ LTIP ALL OTHER
NAME AND SALARY BONUS COMPENSATION AWARD(S) SARS (4) PAYOUTS COMPENSATION (6)
PRINCIPAL POSITION YEAR ($) ($) ($) (4) ($) (4) ($)
- ------------------- ---- ---------- ------------ ----------- ---------- --------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Bernard Briskin, 1994 440,000 273,068 41,791(3) 3,000(5)
Chief Executive 1993 350,000 2,248,019(2) 994,609(3) -0-
Officer 1992 350,000 193,804 43,611(3) -0-
Ernest T. Klinger, 1994 190,000(1) -0- (7) 3,000(5)
CFO, VP Finance 1993 190,000(1) -0- (7) 9,450(5)
and Administration 1992 193,654(1) -0- (7) -0-
<FN>
(1) Salary covers compensation for 52 weeks in both 1994 and 1993 and 53
weeks in 1992.
(2) Includes a one time bonus to Mr. Briskin of $1,911,827 related to the
sale of the Company's communication equipment business.
(3) Includes for fiscal 1993 a payment of $941,676 to Mr. Briskin under a
deferred compensation arrangement. Also includes payments to Mr.
Briskin of $30,242, $42,085 and $34,035 for fiscal years 1994, 1993 and
1992, respectively, for the purpose of enabling him to purchase life
insurance.
(4) The Company did not grant to Mr. Briskin or Mr. Klinger any restricted
stock, stock options or stock appreciation rights ("SARs") and made no
payout to them on any long-term incentive plan in fiscal years 1994,
1993, or 1992.
(5) The amount of the Company contribution to the Arden Group, Inc. 401(k)
Retirement Savings Plan allocated to the named executive officer.
(6) Does not include retirement benefits from the Telautograph Pension Plan,
which was terminated in 1993, or benefits allocable under the Company
Stock Bonus Plan.
6
<PAGE>
(7) Perquisites and other personal benefits did not exceed the lesser or
$50,000 or 10% of the compensation received by Mr. Klinger in any of the
years for which compensation information is reported.
</TABLE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Board of Directors has a Compensation Committee. At the end of
fiscal 1994 the Compensation Committee consisted of the following directors:
Daniel Lembark, Chairman
Robert A. Davidow
Frederick A. Schnell
Ben Winters
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
The Compensation Committee of the Board of Directors (the "Committee") is
composed of four outside directors and is responsible for developing and making
recommendations to the Company Board with respect to the Company's executive
compensation policies. The objective of the Committee is to support the
achievement of the Company goals by providing compensation which will attract
and retain superior talent and reward performance.
COMPENSATION FOR BERNARD BRISKIN
The compensation of Mr. Bernard Briskin, the Chief Executive Officer of the
Company, is established under an Employment Agreement dated May 13, 1988 which
was amended effective January 1, 1994 (the "Employment Agreement"). The term of
the Employment Agreement expires January 1, 2001. Effective January 1, 1994,
pursuant to the Employment Agreement, Mr. Briskin's base salary was increased to
$440,000 per year from $350,000 per year. His base salary was increased
effective January 1, 1995 to $444,400 per year based upon the increase in the
Consumer Price Index and will be increased on January 1 of succeeding years
during the term of the Employment Agreement based upon further increases in the
Consumer Price Index subject, however, to a maximum annual increase. The annual
bonus arrangement provided for Mr. Briskin in the Employment Agreement was
approved by the stockholders at the 1994 Annual Meeting of Stockholders. The
amount of the bonus is equal 2 1/2% of the Company's first $2,000,000 of Pre-Tax
Profits (as defined in the Employment Agreement) plus 3 1/2% of Pre-Tax Profits
in excess of $2,000,000. For fiscal year 1994, the amount of the bonus was
$273,068.
As described in the Report of the Compensation Committee in the Proxy Statement
for the 1994 Annual Meeting of Stockholders, the amendments effective January 1,
1994 were the result of several months of discussion between Mr. Briskin and the
Committee. In considering the terms and provisions of the Employment Agreement,
the Committee took into account a number of factors, including comparative
salaries, the fact that no increase in Mr. Briskin's base salary had occurred
since 1988, the elimination or expiration of other benefits under the then
existing employment agreement, and certain additional responsibilities relating
to long-term planning.
OTHER COMPENSATION
As to other executive officers, the program of executive compensation
implemented by the Committee is intended to provide an overall level of
compensation that is competitive within the grocery business. Actual
compensation levels may be greater or less than average competitive levels in
other companies based upon annual and long-term performance of the Company, as
well as the individual performance, responsibility and achievement of the
executive officer. Accordingly, the Committee uses its discretion to set
executive compensation based on internal, external and individual factors.
The Arden Group, Inc. Stock Bonus Plan is included as a component of executive
compensation and thus, as well as other factors, ties a portion of executive
compensation to the profitability of the Company.
In general, Section 162(m) of the Internal Revenue Code of 1986, as amended,
disallows deductions by a publicly traded corporation for compensation in excess
of $1,000,000 to its chief executive officer or any of its four other highest
paid officers. The Committee does not expect that any executive officer's
compensation for the 1995 fiscal year will exceed the $1,000,000 IRS deduction
cap. In any event, since Mr. Briskin's bonus arrangement was approved by
stockholders, the amount of Mr. Briskin's annual bonus arrangement should be
excluded from the computation to determine whether his compensation exceeds the
$1,000,000 deduction cap.
Daniel Lembark, Chairman Robert A. Davidow
Frederick A. Schnell Ben Winters
Members of the Compensation Committee.
7
<PAGE>
PERFORMANCE GRAPH
Set forth below is a line graph comparing the cumulative total
stockholder return on the Company Common Stock against the cumulative total
return of the Standard & Poor's 500 Stock Index, the Standard & Poor's Food
Retailers Index and the Dow Jones Food Retailers Index for the period of five
years commencing December 31, 1989 and ending December 31, 1994. The graph
assumes that $100 was invested on December 31, 1989 in the Company Stock and in
each of the above-mentioned indices that all dividends were reinvested.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
ARDEN GROUP, INC. S&P 500 INDEX S&P FOOD RETAILERS INDEX
<S> <C> <C> <C>
1989 100 100 100
1990 68.25 96.89 105.87
1991 73.01 126.42 111.49
1992 55.55 136.05 145.79
1993 80.95 149.76 141.42
1994 72.22 151.74 151.36
</TABLE>
STOCK BONUS PLAN
The Company has a non-contributory trusteed stock bonus plan which is
qualified under Section 401 of the Internal Revenue Code of 1986, as amended.
All non-union employees over 18 years of age who complete 1,000 hours of service
are eligible to become participating employees in the plan. Contributions to
the plan for any fiscal year, as determined by the Board of Directors, are
discretionary, but in no event to exceed 15% of the annual aggregate salaries of
those employees eligible for participation in the plan. Any assets of the Plan
which are not invested in the Company's Class A Common Stock may be invested in
certain government backed securities. Contributions to the plan are allocated
among eligible participants in the proportions of their salaries to the salaries
of all participants. Contributions accrued for the Plan in 1994 were $328,000.
ARDEN GROUP, INC. 401(k) RETIREMENT SAVINGS PLAN
Effective January 1, 1992, the Company's Board adopted the Arden Group,
Inc. 401(k) Retirement Savings Plan (the "Company Savings Plan"). All non-union
employees of the Company and its subsidiaries (except employees of AMG Holdings)
who have attained the age of 18 and have completed at least one year of service
with any of such companies are entitled to participate in the Company Savings
Plan. The Company Savings Plan provides that, with certain limitations, a
participating employee may elect to contribute up to 15% of such employee's
annual compensation to the Company Savings Plan on a tax-deferred basis, subject
to a limitation that the annual elective contribution may not exceed an annual
indexed dollar limit determined pursuant to the Internal Revenue Code ($9,240 in
1994). Annual contributions are made by the Company, in a discretionary amount
as determined by the Company each year. Contributions accrued for the Plan in
1994, to be contributed in early 1995, were $130,000.
8
<PAGE>
EMPLOYMENT AGREEMENT - BERNARD BRISKIN
Mr. Briskin is employed as the Chairman of the Board of Directors,
President and Chief Executive Officer of the Company and Arden-Mayfair, Inc. and
the Chairman of the Board and Chief Executive Officer of AMG Holdings, Inc. and
Gelson's Markets pursuant to an employment agreement which was entered into as
of May, 1988 (such agreement is hereinafter referred to as the "Agreement").
The Agreement was amended in April, 1994 retroactive to January 1, 1994 (the
Agreement as amended is hereinafter referred to as the Amended Agreement.) The
Amended Agreement has a term ending at January 1, 2001 and provides that the
term thereof is subject to automatic extension thereafter for periods of one
fiscal year each unless either his employers or Mr. Briskin gives notice of
termination not less than 15 months nor more than 18 months prior to the date
upon which the term of the Amended Agreement will expire. If at any time the
employers decide not to extend the Amended Agreement for another year, Mr.
Briskin is entitled to receive the sum of $600,000 as severance pay.
The Amended Agreement provides for an annual base salary of $440,000 and
a bonus based upon the "pre-tax profits" (as defined) of the Company for each
fiscal year to the extent of 2 1/2% of the first $2,000,000 of pre-tax profits
and 3 1/2% of pre-tax profits in excess of $2,000,000. "Pre-tax Profits" for a
particular fiscal year is the amount shown on the audited Consolidated Statement
of Operations of the Company for such fiscal year as "Income Before Income Taxes
and Extraordinary Items," adjusted so as to exclude any charge, accrual or
deduction for any bonus paid or payable to Mr. Briskin. The annual base salary
is subject to a cost of living adjustment effective as of January 1, 1995 and as
of January 1 of each year thereafter (the Adjustment Date.) The base salary is
adjusted for increases in the Consumer Price Index for All Urban Wage Earners
and Clerical Workers Los Angeles-Anaheim-Riverside Metropolitan Area (1982-
1984 = 100) published by the Bureau of Labor Statistics of the United States
Department of Labor (the Index). The base salary is adjusted for 100% of any
increase in the Index up to 3% and 50% for any increase in the Index in excess
of 3% up to 5%, with no adjustment for any increase in the Index in excess of
5%. The amount of the increase in the Index is calculated by dividing the Index
for the month of October immediately preceding the applicable Adjustment Date by
the Index for the month of October of the immediately preceding calendar year.
As a result of the cost of living adjustment, the base salary was increased to
$444,400 as of January 1, 1995.
The Amended Agreement also provides for certain expense reimbursement
and personal benefits, including payment or reimbursement for uninsured medical
expenses of Mr. Briskin and his immediate family up to a maximum of $100,000
during any calendar year. In addition, in the event that Mr. Briskin becomes
permanently disabled, dies or his employment is terminated without cause during
the term of the Amended Agreement, then all amounts of principal and accrued
interest outstanding under the Promissory Notes of $212,500 and $303,750 in
original principal amounts, respectively, (see Certain Other Transactions) are
forgiven.
The Amended Agreement provides that its terms will be subject to review
during the 1997 fiscal year by the Compensation Committee of the Board of
Directors. Pursuant to this provision, the terms of the Amended Agreement may
be modified.
CERTAIN OTHER TRANSACTIONS
In connection with the purchase by Mr. Briskin of shares of the Company's
Class A Common Stock in 1979 and 1980, the Company loaned Mr. Briskin $212,500
and $303,750, respectively. Under his Amended Employment Agreement the interest
rates payable under the notes reflecting such loans and the maturity dates of
such notes were modified. Interest on the unpaid principal of such loans is
payable at the rate of 6% per annum payable annually on or before December 31 of
each year. Principal on the $212,500 note is payable in annual installments of
$30,357.14 commencing December 31, 1994 and continuing each December 31
thereafter until December 31, 2000 at which time the entire unpaid principal
balance of that note with all accrued and unpaid interest is due and payable.
Principal on the $303,750 note is payable in annual installments of $43,392.86
commencing on December 31, 1994 and continuing each December 31 thereafter until
December 31, 2000 at which time the entire unpaid principal balance of that note
with all accrued and unpaid interest is due and payable. The foregoing notes
are collateralized by 100,000 shares of the Company's Class B Common Stock. The
outstanding balance of the two notes as of December 31, 1994 was $442,500.
RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Company's Board of Directors, upon recommendation of its Audit
Committee, has selected Coopers & Lybrand, independent certified public
accountants, to audit the books, records and accounts of the Company and its
consolidated subsidiaries for the 1995 fiscal year. Coopers & Lybrand has
audited the books, records and accounts of the Company and its subsidiaries for
a number of years. If the stockholders do not ratify the appointment of Coopers
& Lybrand, other certified public accountants will be appointed by the Board on
recommendation of the audit committee.
9
<PAGE>
It is anticipated that representatives of Coopers & Lybrand will attend the
Meeting with the opportunity to make any statement they may desire to make, and
will be available to respond to appropriate questions from stockholders.
Ratification of the selection of independent public accountants for the
Company requires the affirmative vote of a majority in voting interest of the
stockholders present, in person or by proxy, and entitled to vote at the
Meeting. Abstentions and broker non-votes will not be voted for or against this
proposal, but will have the effect of negative votes since an affirmative vote
of a majority in voting interest of stockholders present and eligible to vote is
required to ratify the selection.
The Board of Directors recommends a vote FOR ratification of the selection
of Coopers & Lybrand.
DEADLINE FOR SUBMISSION OF STOCKHOLDER PROPOSALS
In the event that a stockholder wishes to submit a proposal for
consideration by the stockholders of the Company at the next Annual Meeting of
Stockholders in conformity with current Securities and Exchange Commission proxy
regulations and any such proposal must be received by any Assistant Secretary of
the Company no later than February 2, 1996 in order for it to be includable in
the proxy statement for such Annual Meeting.
By Order of the Board of Directors
/s/
-------------------------------
Assistant Secretary
May 31, 1995
10
<PAGE>
PROXY CLASS A COMMON
ARDEN GROUP, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF ARDEN GROUP, INC.
Bernard Briskin, Daniel Lembark and Ben Winters are hereby appointed proxies
(each with power to act alone and with power of substitution) to vote all shares
which the undersigned would be entitled to vote at the Annual Meeting of
Stockholders of Arden Group, Inc., at The Beverly Hilton Hotel, Beverly Hills,
California at 10:00 a.m. on June 27, 1995 and all adjournments thereof, on the
matters set forth below, and in their discretion upon any other matters brought
before the meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS NO. 1 AND 2.
1. ELECTION OF DIRECTORS
FOR / / the nominee listed below (except as marked to the contrary
below)
Daniel Lembark
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY NOMINEE, STRIKE A LINE
THROUGH THAT NOMINEE'S NAME ABOVE).
WITHHOLD AUTHORITY / / to vote the nominee listed above
2. FOR / / AGAINST / / ABSTAIN / / the proposal to ratify the selection of
Coopers & Lybrand as independent public accountants of the Company.
(Continued and to be signed on other side)
<PAGE>
(continued from other side)
THIS PROXY WILL BE VOTED AS SPECIFIED, BUT IF NO SPECIFICATION IS MADE, IT WILL
BE VOTED AS RECOMMENDED BY THE BOARD OF DIRECTORS.
The undersigned hereby revokes all prior proxies.
PLEASE SIGN, DATE, AND MAIL
THIS PROXY TODAY
Dated ______________________
Signature __________________
Signature __________________
/ / I/WE PLAN TO ATTEND THE
MEETING.
Please be sure to date this
Proxy and to sign exactly as
your name appears hereon; joint
owners should each sign, if by
a corporation, in the manner
usually employed by it; if by a
fiduciary, the fiduciary's
title should be shown.
YOUR VOTE IS IMPORTANT.
<PAGE>
PROXY CLASS B COMMON
ARDEN GROUP, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF ARDEN GROUP, INC.
Bernard Briskin, Daniel Lembark and Ben Winters are hereby appointed proxies
(each with power to act alone and with power of substitution) to vote all shares
which the undersigned would be entitled to vote at the Annual Meeting of
Stockholders of Arden Group, Inc., at The Beverly Hilton Hotel, Beverly Hills,
California at 10:00 a.m. on June 27, 1995 and all adjournments thereof, on the
matters set forth below, and in their discretion upon any other matters brought
before the meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS NO. 1 AND 2.
1. ELECTION OF DIRECTORS
FOR / / the nominees listed below (except as marked to the contrary
below)
(a) Bernard Briskin (b) John G. Danhakl
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY NOMINEE, STRIKE A LINE
THROUGH THAT NOMINEE'S NAME ABOVE).
WITHHOLD AUTHORITY / / to vote the nominee listed above
2. FOR / / AGAINST / / ABSTAIN / / the proposal to ratify the selection of
Coopers & Lybrand as independent public accountants of the Company.
(Continued and to be signed on other side)
<PAGE>
(continued from other side)
THIS PROXY WILL BE VOTED AS SPECIFIED, BUT IF NO SPECIFICATION IS MADE, IT WILL
BE VOTED AS RECOMMENDED BY THE BOARD OF DIRECTORS.
The undersigned hereby revokes all prior proxies.
PLEASE SIGN, DATE, AND MAIL
THIS PROXY TODAY
Dated ______________________
Signature __________________
Signature __________________
/ / I/WE PLAN TO ATTEND THE
MEETING.
Please be sure to date this
Proxy and to sign exactly as
your name appears hereon; joint
owners should each sign, if by
a corporation, in the manner
usually employed by it; if by a
fiduciary, the fiduciary's
title should be shown.
YOUR VOTE IS IMPORTANT.
