<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/X/ Preliminary Proxy Statement
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.142-12
CERTIFIED GROCERS OF CALIFORNIA, LTD.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
CERTIFIED GROCERS OF CALIFORNIA, LTD.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2)
/ / $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:*
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
* Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / 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>
CERTIFIED GROCERS OF CALIFORNIA, LTD.
2601 SOUTH EASTERN AVENUE, LOS ANGELES, CALIFORNIA 90040
-------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MARCH 14, 1995
The Annual Meeting of Shareholders of Certified Grocers of California, Ltd.,
a California corporation, will be held at the executive offices of the Company
located at 5200 Sheila Street, Los Angeles, California, on March 14, 1995 at
10:00 a.m., for the following purposes:
1. To elect the fifteen members of the Board of Directors for the
ensuing year, twelve by the holders of Class A Shares and three by the
holders of Class B Shares.
2. To transact such other business as may properly come before the
meeting.
The names of the nominees intended to be presented by the Board of Directors
for election as Directors for the ensuing year are set forth in the accompanying
proxy statement.
Only shareholders of record at the close of business on January 26, 1995
will be entitled to vote at the meeting.
All shareholders are cordially invited to attend the meeting in person.
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, IT IS REQUESTED THAT YOU
COMPLETE, DATE AND SIGN THE ENCLOSED PROXY RELATING TO THE ANNUAL MEETING AND
RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. YOU MAY REVOKE YOUR PROXY IF YOU
ATTEND THE MEETING AND WISH TO VOTE YOUR SHARES IN PERSON.
BY ORDER OF THE BOARD OF DIRECTORS
DAVID A. WOODWARD, SECRETARY
February 7, 1995
<PAGE>
CERTIFIED GROCERS OF CALIFORNIA, LTD.
2601 SOUTH EASTERN AVENUE, LOS ANGELES, CALIFORNIA 90040
------------------------
PROXY STATEMENT
-------------------
INTRODUCTION
This proxy statement is furnished in connection with the solicitation by the
Board of Directors of Certified Grocers of California, Ltd. (the "Company") of
proxies for use (1) at the Annual Meeting of Shareholders to be held March 14,
1995, or at any adjournment thereof (see, "SOLICITATION OF PROXIES FOR USE AT
ANNUAL MEETING"), and (2) in connection with the approval of certain loans or
guaranties by the Company or its subsidiaries (see, "SOLICITATION OF PROXIES
REGARDING LOANS OR GUARANTIES"). Separate forms of proxy apply to the Annual
Meeting and to the approval of such loans or guaranties. These separate forms of
proxy accompany this proxy statement.
A shareholder giving a proxy may revoke it at any time before it is
exercised by filing with the Secretary of the Company a written revocation or a
fully executed proxy bearing a later date. A proxy may also be revoked if the
shareholder who has executed it is present at the meeting and elects to vote in
person.
These proxy materials were first mailed to shareholders on or about February
7, 1995. The cost of soliciting the proxies, including the printing, handling
and mailing of the proxies and related material, will be paid by the Company.
Proxies may be solicited by officers and regular employees of the Company by
telephone or in person. These persons will receive no additional compensation
for their services.
SOLICITATION OF PROXIES FOR USE
AT ANNUAL MEETING
OUTSTANDING SHARES AND VOTING RIGHTS
Only the holders of Class A Shares of record and the holders of Class B
Shares of record at the close of business on January 26, 1995 are entitled to
vote at the Annual Meeting. On that date, the Company had outstanding 48,500
Class A Shares and 368,872 Class B Shares.
The Board of Directors of the Company consists of 15 directors, 12 of whom
are to be elected at the Annual Meeting by the holders of the Company's Class A
Shares and 3 of whom are to be elected by the holders of the Company's Class B
Shares.
Each class of shares is entitled to one vote for each share on those matters
with respect to which the class is entitled to vote. However, if any shareholder
gives notice of his intention to cumulate his votes in the election of directors
before any votes have been cast in such election, then all shareholders may
cumulate their votes in the election of directors. Under cumulative voting, each
holder of Class A Shares may give one nominee a number of votes equal to the
number of Class A Shares which the holder is entitled to vote multiplied by the
number of directors to be elected by the holders of Class A Shares (12 at this
meeting) or the holder may distribute such votes among any or all of the
nominees as he sees fit. Similarly, the Class B Shares entitled to be voted may
be voted cumulatively by the holders of such shares for the 3 directors to be
elected by the holders of Class B Shares. Discretionary authority to cumulate
votes is solicited. The proxy holders named on the enclosed form of proxy
relating to the Annual Meeting have no present intention to give notice of their
intention to cumulate votes, but they may elect to do so in the event of a
contested election or any presently unexpected circumstances.
In the election of directors, the nominees receiving the highest number of
affirmative votes of the class of shares entitled to be voted for them, up to
the number of directors to be elected by such class, will be elected. Under the
California Corporations Code, votes against a nominee and votes withheld have no
legal effect.
On all matters coming before the Annual Meeting, other than the election of
directors, each Class A Share is entitled to one vote, and, except as may be
required by California law, each Class B Share has no
<PAGE>
vote. California law extends to non-voting shares the right to vote upon certain
matters such as certain amendments to the Articles of Incorporation which affect
the rights of non-voting shares, certain reorganizations in which other
securities are to be issued in exchange for the non-voting securities, and
voluntary dissolution. No such matter is proposed to be submitted by management
at the Annual Meeting and management is not aware that any such matter will be
submitted by any other person.
ELECTION OF DIRECTORS
At the Annual Meeting 15 directors (constituting the entire board) are to be
elected to serve until the next Annual Meeting and until their successors are
elected and qualified. Twelve directors are to be elected by the holders of the
Company's Class A Shares and 3 directors are to be elected by the holders of the
Company's Class B Shares.
The following table sets forth certain information concerning the Board of
Directors' nominees for election. All of the nominees are currently serving as
directors of the Company. As of the date of this proxy statement, all nominees
have consented to being named herein as nominees and to serve as directors if
elected.
<TABLE>
<CAPTION>
YEAR
AGE AS OF FIRST PRINCIPAL OCCUPATION
NAME 12/31/94 ELECTED DURING LAST 5 YEARS
- ------------------------------------ --------------- ----------- ------------------------------------------------
<S> <C> <C> <C>
NOMINEES FOR ELECTION
BY CLASS A SHARES
Louis A. Amen 65 1974 President, Super A Foods, Inc.
John Berberian 43 1991 President, Berberian Enterprises, Inc.,
operating Jons Markets
Gene A. Fulton 55 1994 President-Owner, Jensen's Complete Shopping,
Inc., operating Jensen's Finest Foods
Lyle A. Hughes(1) 57 1987 General Manager, Yucaipa Food Fair, Inc.,
operating Calimesa Food Fair
Darioush Khaledi 48 1993 Chairman of the Board and Chief Executive
Officer, K.V. Mart Co., operating
Top Valu Markets and Valu Plus Food
Warehouse
Mark Kidd 44 1992 President, Mar-Val Food Stores, Inc.
Willard R. MacAloney 59 1981 President and Chief Executive Officer,
Mac Ber, Inc., operating Jax Market
Jay McCormack 44 1993 Owner-Operator, Alamo Market;
Co-owner, Glen Avon Market
Morrie Notrica 65 1988 President and Chief Operating Officer,
Joe Notrica, Inc., operating The Original 32nd
Street Market
Michael A. Provenzano 52 1986 President, Pro & Son's, Inc., operating
Southland Market since 1993; formerly President,
Carlton's Market, Inc.
James R. Stump 56 1982 President, Stump's Market, Inc.
Kenneth Young 50 1994 Vice President, Jack Young's Super-
markets; Vice President, Bakersfield
Food City, Inc. dba Young's Markets
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
YEAR
AGE AS OF FIRST PRINCIPAL OCCUPATION
NAME 12/31/94 ELECTED DURING LAST 5 YEARS
- ------------------------------------ --------------- ----------- ------------------------------------------------
NOMINEES FOR ELECTION BY CLASS B
SHARES
<S> <C> <C> <C>
Roger K. Hughes(1) 60 1985 Chairman of the Board and Director, Hughes
Markets, Inc.
Allan Scharn 59 1988 President, Gelson's Markets
Michael A. Webb 37 1992 President and Chief Executive Officer, SavMax
Foods, Inc.
<FN>
- --------------
(1) Messrs. Lyle A. Hughes and Roger K. Hughes are unrelated.
</TABLE>
The proxy holders named on the enclosed form of proxy relating to the Annual
Meeting will vote the proxies received by them for the election of the above
nominees unless such authority is withheld as provided in the proxy. In the
unanticipated event that any nominee should become unavailable for election as a
director, the proxies will be voted for any substitute nominee named by the
present Board of Directors. In their discretion, the proxy holders may cumulate
the votes represented by the proxies received. If additional persons are
nominated for election as directors by persons other than the Board of
Directors, the proxy holders intend to vote all proxies received by them in such
manner in accordance with cumulative voting as will assure the election of as
many of the above nominees as possible, with the specific nominees to be voted
for to be determined by the proxy holders.
SOLICITATION OF PROXIES REGARDING
LOANS OR GUARANTIES
BACKGROUND
The Company and its subsidiaries make available to patrons of the Company,
including patrons holding the Class A Shares and Class B Shares of the Company,
various forms of retail and financial assistance. Among these is assistance in
the form of loans by the Company or its subsidiaries to such patrons, or
guaranties by the Company or its subsidiaries of the obligations of such
patrons. Such loans or guaranties are available to, and the Company presently
intends to enter into loans or guaranties with, qualified patrons for such
purposes as the acquisition of inventory and equipment, the remodeling or
expansion of existing retail locations, the acquisition, leasing or development
of new retail locations, and other general business purposes of such patrons.
It is important to the Company that where such loans or guaranties are made
to shareholding patrons, that they be made upon the security of the Class A
Shares and Class B Shares of such patrons. It is also important to the Company
that those patrons serving as directors of the Company, and those patrons
affiliated with persons serving as directors of the Company, not be precluded
thereby from receiving such loans or guaranties from the Company and its
subsidiaries. However, the California Corporations Code provides that unless
approved by a majority of the shareholders entitled to act thereon (which in the
case of the Company means the holders of Class A Shares), a corporation may not
make any loan of money or property to, or guarantee the obligation of, (1) any
person upon the security of shares of such corporation or its parent if such
corporation's recourse in the event of default is limited to the security for
the loan or guaranty, unless the loan or guaranty is adequately secured without
considering these shares, or (2) any director or officer of such corporation or
its parent.
The enclosed form of proxy regarding loans or guaranties is being solicited
in order to enable the members of the Company's Credit Committee, as proxy
holders, to vote, consider, act upon and, in their discretion, approve loans of
money or property to, or guaranties of the obligations of, any patron of the
Company upon the security of the Company's stock, and any director of the
Company. By its terms, the enclosed form of proxy is valid through March 13,
1996. Until that time, and unless revoked by the person granting it, the proxy
would empower the members of the Company's Credit Committee, as proxy holders,
to
3
<PAGE>
take the foregoing actions on behalf of the holders of the shares represented by
the proxies at any duly called shareholders' meeting, or to execute written
consents to the taking of the foregoing actions without a meeting on behalf of
the holders of the shares represented by the proxies.
Proxies are not being solicited with respect to the approval of loans or
guaranties in favor of officers of the Company, and the enclosed form of proxy
does not confer any authority upon the proxy holders with respect to such
matters.
The Company's Credit Committee consists of William O. Christy, Marshall
Italiano, Arthur Reicher and Donald Dill. Messrs. Christy, Italiano and Reicher
are not officers or directors of the Company, and they are not patrons of the
Company. Mr. Reicher is, however, a financial consultant to the Board of
Directors of the Company and a director of Hughes Markets, Inc. Mr. Italiano is
a director of SavMax Foods, Inc. and is the representative of Grocers Capital
Company on the board of directors of Major Market, Inc. Mr. Christy was formerly
the Corporate Chairman and the President and Chief Executive Officer of the
Company. Mr. Dill is a Senior Vice President of the Company, but is not a
director or patron of the Company, although he is the representative of Grocers
Capital Company on the board of directors of Major Market, Inc. None of the
foregoing individuals owns shares of any class of the Company's stock.
VOTING RIGHTS
The enclosed form of proxy regarding loans or guaranties is being solicited
from the holders of Class A Shares of record at the close of business on January
26, 1995. On that date, the Company had outstanding 48,500 Class A Shares.
Proxies are not being solicited from the holders of Class B Shares since loans
or guaranties of the type involved do not require the approval of the holders of
such shares.
In voting upon loans or guaranties of the type here involved, Class A Shares
would be entitled to one vote for each share, and there would be no right to
cumulate votes. Approval of such loans or guaranties would require the
affirmative vote of a majority of the Class A Shares represented and voting at a
duly held meeting at which a quorum was present (a quorum being a majority of
the Class A Shares entitled to vote), with the shares owned by the affected
patron or director not being entitled to vote. If approval were to be given by
means of the written consent of shareholders, then such approval would require
the written consent of the holders of a majority of the Class A Shares
outstanding and entitled to vote, with the shares owned by the affected patron
or director not being entitled to vote.
In order for a loan or guaranty to be approved by the members of the Credit
Committee, as proxy holders, such proxy holders would be required to hold
proxies entitled to be voted "In Favor" (as explained below) representing a
majority of the Class A Shares entitled to vote with respect to such loan or
guaranty, with the shares represented by the proxy of the affected patron or
director not being entitled to vote. In addition, at least two of the proxy
holders would have to exercise their discretion to vote the shares represented
by such proxies to approve the loan or guaranty, and in the case of a loan or
guaranty in favor of a director of the Company, approval would be required by at
least two of the proxy holders, excluding Mr. Dill and any proxy holder
affiliated with the director.
The enclosed form of proxy provides boxes whereby the person giving the
proxy may designate how it is to be exercised and voted. If the box labeled "In
Favor" is marked, the proxy holders will vote, or give written consents with
respect to, the shares represented by the proxy in their discretion respecting
approval of the loans or guaranties; if the box labeled "Against" is marked, the
proxy holders will vote the shares represented by the proxy against the approval
of the loans or guaranties; and, if the box labeled "Abstain" is marked, the
proxy holders will not vote the shares represented by the proxy respecting
approval of the loans or guaranties. If none of the foregoing designations is
made, the proxy holders will vote, or give written consents with respect to, the
shares represented by the proxy in their discretion respecting approval of the
loans or guaranties.
INTEREST OF CERTAIN PERSONS
Inasmuch as the enclosed form of proxy is being solicited in part for the
purpose of enabling the members of the Company's Credit Committee, as proxy
holders, to approve loans or guaranties to directors of the Company, all
directors of the Company and all persons nominated for election as directors of
the Company, have a potential interest in the matter. Patrons serving as
directors or nominated for election as
4
<PAGE>
directors, and patrons affiliated with such directors and nominees, have sought
loans or guaranties from the Company and its subsidiaries in the past and may be
expected to do so in the future. In such event, they would have a direct
interest in the approval by the members of the Credit Committee, as proxy
holders, of any such loan or guaranty. For a description of transactions with
certain directors, please refer to the section of this proxy statement entitled
"Transactions With Management".
PRINCIPAL STOCKHOLDERS
As of January 26, 1995, no person is known by the Company to own
beneficially more than five percent (5%) of the outstanding Class A Shares of
the Company, and the only shareholders known by the Company to own beneficially
more than 5% of the outstanding Class B Shares of the Company are Cala Co.,
Alpha Beta Company and Bay Area Warehouses, 777 South Harbor Boulevard, La
Habra, California 90631 (35,313 Class B Shares or approximately 9.09% of the
outstanding Class B Shares) (Cala Co., Alpha Beta Company and Bay Area
Warehouses are wholly owned by Food 4 Less Supermarkets, Inc. which has the same
address and is in turn wholly owned by The Yucaipa Companies, 250 West First
Street, Suite 202, Claremont, California 91711); and Hughes Markets, Inc., 14005
Live Oak Avenue, Irwindale, California 91706 (30,346 Class B Shares or
approximately 7.82% of the outstanding Class B Shares).
5
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth the beneficial ownership of the Company's
Class A Shares and Class B Shares, as of January 26, 1995, by each director and
nominee, or their affiliated companies, and by all directors and nominees, and
their affiliated companies, as a group. No officer of the Company owns shares of
any class of the Company's stock.
<TABLE>
<CAPTION>
SHARES OWNED
---------------------------------------------
CLASS A SHARES CLASS B SHARES
-------------------- ---------------------
NAME AND NO. % OF TOTAL NO. % OF TOTAL
AFFILIATED COMPANY SHARES OUTSTANDING SHARES OUTSTANDING
- ---------------------------------------------------------- ------ ----------- ------- -----------
<S> <C> <C> <C> <C>
Louis A. Amen
Super A Foods, Inc...................................... 100 0.21% 9,850 2.67%
John Berberian
Berberian Enterprises, Inc. ............................ 100 0.21% 7,615 2.06%
William C. Evans
Twain Harte Market, Inc. (1)............................ 100 0.21% 298 0.08%
Gene A. Fulton
Jensen's Complete Shopping, Inc. ....................... 100 0.21% 1,555 0.42%
Lyle A. Hughes
Yucaipa Food Fair, Inc. (2)............................. 100 0.21% 694 0.19%
Roger K. Hughes
Hughes Markets, Inc. (2)(3)............................. 100 0.21% 30,346 8.23%
Darioush Khaledi
K.V. Mart Co. .......................................... 100 0.21% 11,646 3.16%
Mark Kidd
Mar-Val Food Stores, Inc. .............................. 100 0.21% 1,675 0.45%
Leonard R. Leum
Pioneer Foods, Inc. (1)................................. 100 0.21% 3,181 0.86%
Willard R. MacAloney
Mac Ber, Inc. .......................................... 100 0.21% 2,523 0.68%
Jay McCormack
Alamo Market (4)........................................ 100 0.21% 732 0.20%
Morrie Notrica
Joe Notrica, Inc. ...................................... 100 0.21% 7,542 2.04%
Michael A. Provenzano
Pro & Son's, Inc........................................ 100 0.21% 672 0.18%
Allan Scharn
Gelson's Markets (3)(5)................................. 100 0.21% 7,485 2.03%
James R. Stump
Stump's Market, Inc. ................................... 100 0.21% 1,866 0.51%
Michael A. Webb
SavMax Foods, Inc. (3).................................. 100 0.21% 8,410 2.28%
Kenneth Young
Jack Young's Supermarkets (6)........................... 100 0.21% 2,649 0.72%
------ --- ------- -----
1,700 3.51% 98,739 26.77%
------ --- ------- -----
------ --- ------- -----
<FN>
- --------------------------
(1) Term of office will not continue beyond the date of the Annual Meeting.
(2) Messrs. Lyle A. Hughes and Roger K. Hughes are unrelated.
(3) To be elected by holders of Class B Shares.
(4) Mr. McCormack also is affiliated with Glen Avon Food, Inc. which owns 100
Class A Shares.
(5) These shares are owned by Arden Mayfair, Inc., the parent company of
Gelson's Markets.
(6) Mr. Young also is affiliated with Bakersfield Food City, Inc. dba Young's
Markets which owns 100 Class A Shares and 343 Class B Shares (0.09% of the
outstanding Class B Shares).
</TABLE>
During fiscal 1994, directors Jay McCormack and Kenneth Young each failed to
file timely with the Securities and Exchange Commission one report respecting
his beneficial ownership of Class A Shares, as required by Section 16(a) of the
Securities Exchange Act of 1934. In each case, the late filing related to a
single transaction for which such filing was required.
6
<PAGE>
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Company held a total of ten meetings during
the fiscal year ended September 3, 1994. Each incumbent director who was in
office during such year attended more than 75% of the aggregate of the total
number of meetings of the board and the total number of meetings held by those
committees of the board on which he served.
The Company has an Audit Committee which consists of Lyle Hughes, Leonard R.
Leum and Kenneth Young, who are directors of the Company. Willard R. MacAloney,
Chairman of the Board of Directors, is an ex-officio member of the Committee.
This Committee, which met two times during the Company's last fiscal year, is
primarily responsible for approving and reviewing the services performed by the
Company's independent auditors, reviewing the annual results of their audit, and
reviewing the Company's accounting practices and system of internal accounting
controls.
The Company has a Personnel and Executive Compensation Committee which
consists of Louis A. Amen, Darioush Khaledi, Leonard R. Leum, James R. Stump and
Michael A. Webb, who are directors of the Company. Willard R. MacAloney,
Chairman of the Board of Directors, is an ex-officio member of this Committee.
This Committee, which met five times during the Company's last fiscal year, is
responsible for reviewing salaries and other compensation arrangements of all
officers and for making recommendations to the Board of Directors concerning
such matters.
The Company has a Nominating Committee which consists of Gene A. Fulton,
Mark Kidd, Jay McCormack, Morrie Notrica and James R. Stump, who are directors
of the Company. Willard R. MacAloney, Chairman of the Board of Directors, and
Alfred A. Plamann, President and CEO, are ex-officio members of this Committee.
This Committee, which met four times during the Company's last fiscal year, is
responsible for selecting nominees to be submitted by the Board of Directors to
the shareholders for election to the Board of Directors.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
As noted under the caption "Board Meetings and Committees", the Company's
Personnel and Executive Compensation Committee (consisting of directors Louis A.
Amen, Darioush Khaledi, Leonard R. Leum, James R. Stump and Michael A. Webb, and
ex-officio member and Chairman of the Board, Willard R. MacAloney) is
responsible for reviewing salaries and other compensation arrangements of the
officers of the Company and for making recommendations to the Board of Directors
concerning such matters.
No member of the Personnel and Executive Compensation Committee is, or has
been at any time in the past, an officer or employee of the Company or any of
its subsidiaries.
REPORT OF PERSONNEL AND EXECUTIVE COMPENSATION COMMITTEE ON EXECUTIVE
COMPENSATION
The principal components of the Company's executive compensation program
consist of an annual salary which is set on a calendar year basis, an annual
cash bonus the payment of which is dependent upon Company performance during the
preceding fiscal year, and certain pension, retirement and life insurance
benefits.
SALARY
In determining officer salaries, including that of the Chief Executive
Officer (CEO), the Personnel and Executive Compensation Committee's policy is to
set salaries at levels which recognize officer performance, are commensurate
with the responsibilities assigned to the various officer positions, and will
enable the Company to attract and retain highly qualified executives for its
officer positions.
In considering officer salaries for calendar year 1994, the Committee took
note of the on-going cost reduction efforts implemented by the officer group
under the direction of the CEO. These efforts were undertaken in response to the
significant volume declines experienced by the Company as a result of a
7
<PAGE>
reduction in purchases by certain large retailers who commenced
self-distribution programs or were acquired by chains already engaged in
self-distribution. These efforts resulted in the consolidation of Company
operations into fewer facilities, the disposition of certain unprofitable
operations and substantial savings in payroll expenses through significant
reductions in the number of employees.
The Committee's procedure in approving officers' salaries, including that of
the CEO, involves meeting in closed session and without the CEO or other
management personnel being present. In addition to the considerations mentioned
above, this process, which is subjective in nature, centers on the Committee's
consideration of the CEO's evaluation of each individual officer based on the
CEO's perception of their performance in accordance with individual officer
responsibilities as defined by personal and organizational goals and objectives,
the relative value and importance of individual officer contribution toward
organizational success, relative levels of officer responsibilities and changes
in the scope of officer responsibilities, and officer accomplishments and
contributions during the preceding fiscal year. The Committee also reviews and
discusses the salary recommendations made by the CEO for each officer. These
recommendations do not include any recommendation as to the CEO's salary, and
the Committee sets the CEO's salary based on its assessment of his performance
in light of the foregoing policies and considerations. The salaries as approved
by the Committee are submitted to the Board of Directors, which made no changes
in the salaries submitted for 1994.
ANNUAL BONUSES
In recognition of the relationship between Company performance and
enhancement of shareholder value, Company officers may be awarded annual cash
bonuses. Bonuses are paid from a bonus pool which is created if the Company has
achieved an established minimum level of net income for the preceding fiscal
year. The amount of the bonus pool is calculated as a percentage of net income,
with the percentage varying depending on the level of net income as a percentage
of net sales. Amounts in the bonus pool are allocated among the Company's
officers by the CEO, subject to the approval of the Board of Directors. The CEO
does not participate in the bonus pool. However, a bonus may be awarded to the
CEO in an amount determined by the Board of Directors based on its evaluation of
the CEO's performance during the preceding fiscal year.
As disclosed in the Summary Compensation Table, no bonuses have been awarded
to the CEO and the named executives during the periods reported, and no bonuses
have been awarded to the other officers of the Company during those periods.
BENEFITS
Consistent with the objective of attracting and retaining qualified
executives, the compensation program includes the provision of pension benefits
to Company employees, including officers, under the Company's defined benefit
pension plan, which is described in connection with the Pension Plan Table. In
addition, Company employees, including officers, may defer income from their
earnings through voluntary contributions to the Company's Employees' Sheltered
Savings Plan adopted pursuant to Section 401(k) of the Internal Revenue Code and
the Company's Employees' Excess Benefit and Supplemental Deferred Compensation
Plan, which is a nonqualified plan. In the case of those officers who elect to
defer income under these plans, the Company makes additional contributions for
their benefit. The amount of these additional contributions made during fiscal
year 1994 for the benefit of the CEO and the other named executive officers is
set forth in the footnotes to the Summary Compensation Table. The Company also
provides life insurance benefits to its officers pursuant to an Executive Salary
Protection Plan Life Insurance Agreement. Premiums paid by the Company to
provide this benefit to the CEO and the other named executive officers are also
set forth in the footnotes to the Summary Compensation Table.
Personnel and Executive Compensation Committee Members
Paul H. Gerrard, Chairman
Louis A. Amen
George G. Golleher
Darioush Khaledi
Leonard R. Leum
Willard R. MacAloney
Michael A. Webb
8
<PAGE>
EXECUTIVE OFFICER COMPENSATION
The following table sets forth information respecting the compensation paid
during the Company's last three fiscal years to the President and Chief
Executive Officer (CEO) and to certain other executive officers of the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
-----------------------------------------------
FISCAL OTHER ANNUAL ALL OTHER
NAME AND PRINCIPAL POSITION (1) YEAR SALARY ($)(2) BONUS ($) COMPENSATION ($) COMPENSATION ($)
- ----------------------------------- ------ ------------ -------- --------------- ------------------
<S> <C> <C> <C> <C> <C>
Everett W. Dingwell II 1994 342,500 0 1,121 41,745(3)
Corporate Chairman 1993 311,539 0 1,411 39,424
1992 275,000 0 213 49,993
Alfred A. Plamann 1994 236,827 0 205 31,431(4)
President & CEO 1993 164,808 0 310 25,419
1992 157,500 0 212 22,508
Donald W. Dill 1994 163,366 0 576 38,127(5)
Senior Vice President 1993 153,346 0 1,016 37,392
1992 147,500 0 411 40,113
Gerald F. Friedler, 1994 209,471 0 260 28,927(6)
Senior Vice President 1993 200,000 0 787 37,809
1992 200,000 0 35 26,095
Donald G. Grose 1994 143,760 0 438 31,700(7)
Senior Vice President 1993 135,116 0 955 30,372
1992 129,000 0 187 30,956
Charles J. Pilliter 1994 167,577 0 127 20,591(8)
Senior Vice President 1993 151,924 0 188 18,240
1992 142,524 0 0 16,854
<FN>
- ------------------------
(1) Mr. Dingwell held the position of President and CEO from January 1990 until
January 31, 1994. Mr. Friedler resigned effective September 4, 1994.
(2) It should be noted that while the table presents salary information on a
fiscal year basis, salary is paid by the Company on a calendar year basis.
Thus, salary information with respect to any given fiscal year reflects
salary attributable to portions of two calendar year salary periods of the
Company.
(3) Consists of an $7,217 Company contribution to the Company's Employees'
Sheltered Savings Plan, a $20,206 Company contribution to the Company's
Employees' Excess Benefit and Supplemental Deferred Compensation Plan, and
$14,322 of insurance premiums paid by the Company pursuant to an Executive
Salary Protection Plan Life Insurance Agreement with the officer.
(4) Consists of an $14,507 Company contribution to the Company's Employees'
Sheltered Savings Plan, a $4,062 Company contribution to the Company's
Employees' Excess Benefit and Supplemental Deferred Compensation Plan, and
$12,862 of insurance premiums paid by the Company pursuant to an Executive
Salary Protection Plan Life Insurance Agreement with the officer.
(5) Consists of an $9,810 Company contribution to the Company's Employees'
Sheltered Savings Plan, a $2,700 Company contribution to the Company's
Employees' Excess Benefit and Supplemental Deferred Compensation Plan, and
$25,617 of insurance premiums paid by the Company pursuant to an Executive
Salary Protection Plan Life Insurance Agreement with the officer.
(6) Consists of an $14,520 Company contribution to the Company's Employees'
Sheltered Savings Plan, a $2,669 Company contribution to the Company's
Employees' Excess Benefit and Supplemental Deferred Compensation Plan, and
$11,738 of insurance premiums paid by the Company pursuant to an Executive
Salary Protection Plan Life Insurance Agreement with the officer.
</TABLE>
9
<PAGE>
<TABLE>
<S> <C>
(7) Consists of an $7,172 Company contribution to the Company's Employees'
(8) Sheltered Savings Plan, a $3,754 Company contribution to the Company's
Employees' Excess Benefit and Supplemental Deferred Compensation Plan, and
$20,774 of insurance premiums paid by the Company pursuant to an Executive
Salary Protection Plan Life Insurance Agreement with the officer.
Consists of an $11,531 Company contribution to the Company's Employees'
Sheltered Savings Plan, and $9,060 of insurance premiums paid by the
Company pursuant to an Executive Salary Protection Plan Life Insurance
Agreement with the officer.
</TABLE>
In September 1994, the Board of Directors of Certified authorized a
modification in the Company's Executive Salary Protection Plan ("ESPP"), which
provided an in-service death benefit and post-termination retirement income to
the Company officers as a select group of employees. The amended plan, called
the Company's Executive Salary Protection Plan ("ESPP II"), will provide an
in-service death benefit, but will also provide additional post-termination
retirement income based on each participant's final salary and years of service
with the Company. The funding of this benefit will be facilitated through the
purchase of life insurance policies, the premiums of which will be paid by the
Company and participant contributions. The cost to the Company is anticipated to
approximate the cost of the prior plan. The Company also has a defined benefit
pension plan covering its non-union and executive employees. Benefits under the
defined benefit plan are equal to credited service times the sum of .95% of
earnings up to the covered compensation amount, plus 1.45% of earnings in excess
of the covered compensation amount. The covered compensation is based on IRS
Tables. Benefits are subject to deduction for Social Security attributable to
the covered compensation.
The following table sets forth the estimated annual benefits under the
defined benefit plan and the ESPP II plan which qualifying officers with
selected years of service would receive if they had retired on September 3, 1994
at the age of 65.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
----------------------------------------------------------
REMUNERATION 5 YEARS 10 YEARS 15 YEARS 20 YEARS 25 YEARS 33 YEARS
- -------------------------------------------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
$100,000......................................... $26,008 $52,016 $67,989 $69,032 $69,982 $ 71,576
125,000......................................... 32,530 65,060 85,055 86,369 87,591 89,620
150,000......................................... 39,052 78,103 102,120 103,706 105,200 107,664
175,000......................................... 45,302 90,603 110,801 119,956 121,450 123,914
200,000......................................... 51,552 100,688 110,801 121,376 131,335 140,164
225,000......................................... 57,802 100,688 110,801 121,376 131,335 147,763
250,000......................................... 64,052 100,688 110,801 121,376 131,335 147,763
300,000......................................... 76,552 100,688 110,801 121,376 131,335 147,763
350,000......................................... 89,052 100,688 110,801 121,376 131,335 147,763
400,000......................................... 90,344 100,688 110,801 121,376 131,335 147,763
450,000......................................... 90,344 100,688 110,801 121,376 131,335 147,763
</TABLE>
The Company's ESPP II is designed to provide a retirement benefit up to 65%
of a participant's final compensation, based on a formula which considers an
executive's final compensation and years of service. Remuneration under ESPP II
is based upon an executive's highest annual base wages during the previous three
completed years, which includes his or her annual salary as determined by the
Board of Directors plus an automobile allowance with a 4% annual increase. The
benefit is subject to an offset of the annual benefit which would be received
from the defined benefit plan, calculated as a single life annuity at age
sixty-two (62). To qualify for participation in the benefit, the executive must
complete three years of service as an officer elected by the Board of Directors
of the Company. Executives will vest at a rate of 5% per year with all years of
service credited. The ESPP II annual benefit upon retirement shall not exceed
$80,000 and will be paid over a 15-year certain benefit. Lesser amounts are
payable if the executive retires before age sixty-five (65). The maximum annual
amount payable by years of service is reflected within the table at the
10
<PAGE>
compensation level of $450,000. As of September 3, 1994, credited years of
service for named officers are: Mr. Dingwell, 26 years; Mr. Plamann, 5 years;
Mr. Dill, 36 years; Mr. Grose, 13 years; and Mr. Pilliter, 18 years. Mr.
Friedler, due to his resignation during September 1994, is not vested in the
ESPP II.
DIRECTOR COMPENSATION
Each director receives a fee of $300 for each regular board meeting
attended, $100 for each committee meeting attended and $100 for attendance at
each board meeting of a subsidiary of the Company on which the director serves.
In addition, directors are reimbursed for Company related expenses.
CUMULATIVE TOTAL SHAREHOLDER RETURN
The following graph sets forth the five year cumulative total shareholder
return on the Company's common stock as compared to the cumulative total return
for the same period of the S&P 500 Index and Peer Issuers consisting of Spartan
Stores, Inc. and Roundy's, Inc. Like the Company, Spartan Stores and Roundy's
are retailer-owned wholesale grocery distributors. While Spartan Stores pays a
dividend on its stock, the Company and Roundy's do not. The shares of the
Company and the Peer Issuers are not traded on any exchange and there is no
established public market for such shares. The price of the Company's shares
during each of its fiscal years is the book value of such shares as of the end
of the prior fiscal year.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
AMONG THE COMPANY, S&P 500 INDEX AND PEER ISSUERS**
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPANY S&P 500 PEER ISSUERS
<S> <C> <C> <C>
1989 100 100 100
1990 103.1 106.9 91.8
1991 97 112.1 112.5
1992 92.3 118.4 117.8
1993 92.9 125.9 131.9
1994 92.6 134.5 135.3
</TABLE>
<TABLE>
<S> <C>
Assumes $100 invested on August 31, 1989 in Company
common stock, S&P 500 Index and Peer Issuers common
stock
* Total return assumes reinvestment of dividends
** Fiscal years ended September 1, 1990, August 31,
1991, August 29, 1992, August 28, 1993 and
September 3, 1994
</TABLE>
TRANSACTIONS WITH MANAGEMENT
All firms with which directors and nominees are affiliated purchase
groceries, related products and store equipment from the Company or its
subsidiaries in the ordinary course of business at prices and on terms available
to Company patrons generally. During the fiscal year ended September 3, 1994, no
director of the Company or nominee (nor the firms with which such directors and
nominees are affiliated) accounted for in excess of 5% of the Company's
consolidated sales.
11
<PAGE>
In fiscal 1994, Grocers Capital Company ("GCC"), a subsidiary, acquired an
additional 25,000 shares of preferred stock of SavMax Foods, Inc. ("SavMax"), of
which director Michael A. Webb is the President and a shareholder. The purchase
price was $100 per share. At the time, GCC owned 40,000 shares of preferred
stock of SavMax which it acquired in fiscal 1992. As part of the new purchase of
preferred stock, the annual cumulative dividend on the 65,000 shares of
preferred stock owned by GCC was increased from $8.25 per share to $8.50 per
share, payable quarterly. Mandatory partial redemption of this stock at a price
of $100 per share began in 1994 and will continue annually thereafter for eight
years, at which time the stock is to be completely retired. GCC also purchased
from Mr. Webb and another member of his immediate family, 10% of the common
stock of SavMax for a price of $2.3 million. In connection with this purchase,
Mr. Webb, SavMax and GCC agreed that GCC will have certain preemptive rights to
acquire additional common shares, rights to have its common shares included
proportionately in any transfer of common shares by Mr. Webb, and rights to have
its common shares included in certain registered public offerings of common
stock which may be made by SavMax. In addition, GCC has certain rights, at its
option, to require that SavMax repurchase GCC's shares, and SavMax has certain
rights, at its option, to repurchase GCC's shares. In connection with these
transactions, SavMax entered into a seven year supply agreement with the Company
(to replace an existing supply agreement) whereunder SavMax is required to
purchase a substantial portion of its merchandise requirements from the Company.
The supply agreement is subject to earlier termination in certain situations.
The Company guarantees certain obligations of SavMax under three leases of
market premises located in Sacramento, San Jose and San Leandro, California.
Each of these guaranties relates to the obligation of SavMax to pay base rent,
common area maintenance charges, real estate taxes and insurance during the
initial 20 year terms of these leases. However, the guaranties are such that the
Company's obligation under each of them is limited to an amount equal to sixty
monthly payments (which need not be consecutive) of the obligations guaranteed.
Base rent is $40,482 per month under the Sacramento lease and $56,756 per month
under the San Jose lease, in each case subject to a 7 1/2% increase at the end
of each five years. Base rent is $42,454 per month under the San Leandro lease,
subject to a 10% increase at the end of each five years. In consideration of
these guaranties, the Company receives a monthly fee from SavMax equal to 5% of
the base monthly rent under these leases.
During fiscal year 1993, the Company leased certain market premises to be
constructed and located in Sacramento, California, and in turn subleased the
premises to SavMax. The sublease to SavMax provides for a term of twenty years,
without options to extend, although SavMax has the option to acquire the
Company's interest under its lease on the condition that the Company is released
from all further liability thereunder. The premises will consist of
approximately 50,000 square feet and annual base rent under the sublease is at
the following per square foot rates: $8.00 during years 1 and 2; $8.40 during
years 3 through 5; $8.82 during years 6 through 10; $9.26 during years 11
through 15; and, $9.72 during years 16 through 20. In addition, the Company will
receive monthly an additional amount equal to 5% of the base monthly rent.
The Company guarantees certain obligations of SavMax under two leases of
market premises located in Ceres and Vacaville, California. The leases have
initial terms expiring in January 2005 and April 2007, respectively. Base
monthly rent under the Ceres lease is presently $32,175, increasing to $34,425
in January 2000. Base monthly rent under the Vacaville lease is presently
$29,167, increasing by $25,000 per year in April of 1997 and 2002. In
consideration of these guaranties, the Company will receive a monthly fee from
SavMax equal to 5% of the base monthly rent under these leases.
In September 1992, the Company guaranteed the obligations of Mar-Val Food
Stores, Inc., of which Director Mark Kidd is the President and a shareholder,
under a lease of market premises located in Valley Springs, California. The
guarantee is of the obligations of Mar-Val Food Stores, Inc. to pay base rent,
common area costs, real estate taxes and insurance during the initial 15 year
term of the lease. Base rent under the lease is $10,080 per month. The Company's
total obligation under the guarantee, however, is limited to the sum of
$736,800. In consideration of its guarantee, the Company receives a monthly fee
from Mar-Val Food Stores, Inc. equal to 5% of the base monthly rent under the
lease.
The Company leases its produce warehouse to Joe Notrica, Inc., of which
director Morrie Notrica is the President and a shareholder. The lease is for a
term of five years expiring in November 1988 and contains an
12
<PAGE>
option to extend for an additional five year period. Monthly rent during the
initial term is $24,000. If the option to extend is exercised, rent during the
option period will be the lesser of fair rental value or the monthly rent during
the initial term as adjusted to reflect the change in the Customer Price Index
during the initial term.
In fiscal 1994, GCC guaranteed a portion of a loan made by National Consumer
Cooperative Bank ("NCCB") to K.V. Mart Co., and KV Property Company, of which
director Darioush Khaledi is a general partner. The term of the loan is eight
years and the loan bears interest at a floating rate based on the commercial
loan base rate of NCCB. The loan is collateralized by certain real and personal
property. The guarantee by GCC is limited to $210,000 of the principal amount of
the loan. In consideration of its guarantee, GCC will receive an annual fee from
K.V. Mart Co. equal to 5% of the guarantee amount.
Grocers General Merchandise Company (GGMC), a subsidiary of the Company, and
Food 4 Less GM, Inc. (F4LGM), an indirect subsidiary of Food 4 Less
Supermarkets, Inc., are parties to a joint venture agreement. Under the
agreement, GGMC and F4LGM are partners in a joint venture partnership known as
Golden Alliance Distribution. The partnership was formed for the purpose of
providing for the shared use of the Company's general merchandise warehouse
located in Fresno, California, and each of the partners has entered into a
supply agreement with Golden Alliance Distribution providing for the purchase of
general merchandise products from Golden Alliance Distribution.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The firm of Coopers & Lybrand, L.L.P., served as the Company's independent
public accountants for the fiscal year ended September 3, 1994. The Board of
Directors has selected that firm to continue as the Company's independent public
accountants for the current fiscal year. A representative of Coopers & Lybrand
is expected to be available at this year's Annual Meeting to respond to
appropriate questions and to make a statement if such firm desires to do so.
SHAREHOLDER PROPOSALS FOR NEXT YEAR'S ANNUAL MEETING
Under the present rules of the Securities and Exchange Commission (the
"Commission"), the deadline for shareholders to submit proposals to be
considered for inclusion in the Company's proxy statement for next year's Annual
Meeting of Shareholders is expected to be October 9, 1995. Such proposals may be
included in next year's proxy statement if they comply with certain rules and
regulations promulgated by the Commission. Such proposals should be submitted to
the Secretary of the Company at the address of the Company's principal executive
office shown on the first page of this proxy statement.
OTHER BUSINESS
The Board of Directors is not aware of any other matters which may be
presented for action at the Annual Meeting. If any matters not referred to in
the form of proxy relating to the Annual Meeting come before the Annual Meeting,
the proxy holders named in such form will vote the shares represented thereby in
accordance with their judgment.
BY ORDER OF THE BOARD OF DIRECTORS
Dated: February 7, 1995
DAVID A. WOODWARD, SECRETARY
13
<PAGE>
P R O X Y
SOLICITED BY THE BOARD OF DIRECTORS OF
CERTIFIED GROCERS OF CALIFORNIA, LTD.
FOR ANNUAL MEETING OF SHAREHOLDERS ON MARCH 14, 1995
The undersigned, revoking any previous proxies respecting the subject matter
hereof, hereby appoints WILLARD R. MACALONEY, ALFRED A. PLAMANN and DAVID A.
WOODWARD attorneys and proxies (each with power to act alone and with power of
substitution) to vote all of the Class A Shares which the undersigned is
entitled to vote and all of the Class B Shares which the undersigned is entitled
to vote, with all powers which the undersigned would possess if personally
present, at the Annual Meeting of Shareholders of Certified Grocers of
California, Ltd., to be held on March 14, 1995, notice of which meeting and the
proxy statement accompanying the same have been received by the undersigned, or
at any adjournment thereof, as follows:
1. ELECTION OF TWELVE DIRECTORS BY CLASS A SHARES.
Nominees: Louis A. Amen, John Berberian, Gene A. Fulton, Lyle A. Hughes,
Darioush Khaledi, Mark Kidd, Willard R. MacAloney, Jay McCormack, Morrie
Notrica, Michael A. Provenzano, James R. Stump and Kenneth Young
/ / VOTE FOR all nominees listed above, EXCEPT ANY WHOSE NAMES ARE
CROSSED OUT IN THE ABOVE LIST (the Board of Directors favors an
instruction to vote for all nominees).
/ /WITHHOLD AUTHORITY to vote for all nominees listed above.
2. ELECTION OF THREE DIRECTORS BY CLASS B SHARES.
Nominees: Roger K. Hughes, Michael A. Webb and Allan Scharn
/ / VOTE FOR all nominees listed above, EXCEPT ANY WHOSE NAMES ARE
CROSSED OUT IN THE ABOVE LIST (the Board of Directors favors an
instruction to vote for all nominees).
/ / WITHHOLD AUTHORITY to vote for all nominees listed above.
3. In their discretion, on such other matters as may properly come before
the meeting or any adjournment thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED, BUT IF NO
DIRECTION IS INDICATED IT WILL BE VOTED FOR ITEMS 1 AND 2, AND ACCORDING TO THE
DISCRETION OF THE PROXIES ON ANY OTHER PROPERLY PRESENTED MATTERS.
<TABLE>
<S> <C>
DATED: --------------, 1995
- -------------------------------------------- --------------------------------------------
Signature Title
- -------------------------------------------- --------------------------------------------
Signature Title
- -------------------------------------------- --------------------------------------------
Signature Title
</TABLE>
PLEASE READ: Execution should be exactly in the name in which the
shares are held; if by a fiduciary, the fiduciary's full title
should be shown; if by a corporation, execution should be in the
corporate name by its chairman of the board, president or a vice
president, or by other officers authorized by resolution of its
board of directors or its bylaws; if by a partnership, execution
should be in the partnership name by an authorized person.
PLEASE COMPLETE, DATE, SIGN AND RETURN THIS
PROXY PROMPTLY USING THE ENCLOSED ENVELOPE.
<PAGE>
P R O X Y
SOLICITED BY THE BOARD OF DIRECTORS OF
CERTIFIED GROCERS OF CALIFORNIA, LTD.
REGARDING APPROVAL OF LOANS OR GUARANTIES
The undersigned, revoking any previous proxies respecting the subject matter
hereof, hereby appoints WILLIAM O. CHRISTY, MARSHALL ITALIANO, ARTHUR REICHER
and DONALD DILL (members of the Credit Committee), or any two of said persons,
as attorneys and proxies (each with power of substitution) to act for the
undersigned, to vote at any duly called shareholders' meeting, to execute
written consents without a meeting or prior notice, and otherwise to represent
all of the Class A Shares of Certified Grocers of California, Ltd. ("Company")
which the undersigned would be entitled to vote, to consider, act upon and, in
said proxies' discretion, approve any loan of money or property by the Company
or any of its subsidiaries to, or any guaranty by the Company or any of its
subsidiaries of the obligations of, the following:
(1) Any patron of the Company upon the security of the shares of stock of
the Company held by such patron.
(2) Any director of the Company, in which case approval shall be required by
two of the proxy holders, excluding Mr. Dill and any proxy holder
affiliated with the director.
The shares of stock represented by this proxy shall be voted as follows:
/ / IN FAVOR / / AGAINST / / ABSTAIN
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED. IF "IN FAVOR",
IT WILL BE VOTED IN SAID PROXIES' DISCRETION RESPECTING APPROVAL OF SUCH LOANS
OR GUARANTIES; IF "AGAINST", IT WILL BE VOTED AGAINST SUCH LOANS OR GUARANTIES;
AND, IF "ABSTAIN", IT WILL NOT BE VOTED RESPECTING APPROVAL OF SUCH LOANS OR
GUARANTIES. IF NO DIRECTION IS INDICATED, IT WILL BE VOTED IN SAID PROXIES'
DISCRETION RESPECTING APPROVAL OF SUCH LOANS OR GUARANTIES.
UNLESS REVOKED, THIS PROXY SHALL BE VALID THROUGH MARCH 13, 1996.
<TABLE>
<S> <C>
DATED: --------------, 1995
- -------------------------------------------- --------------------------------------------
Signature Title
- -------------------------------------------- --------------------------------------------
Signature Title
- -------------------------------------------- --------------------------------------------
Signature Title
</TABLE>
PLEASE READ: Execution should be exactly in the name in which the
shares are held; if by a fiduciary, the fiduciary's full title
should be shown; if by a corporation, execution should be in the
corporate name by its chairman of the board, president or a vice
president, or by other officers authorized by resolution of its
board of directors or its bylaws; if by a partnership, execution
should be in the partnership name by an authorized person.
PLEASE COMPLETE, DATE, SIGN AND RETURN THIS
PROXY PROMPTLY USING THE ENCLOSED ENVELOPE.
