<PAGE> 1
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:
/ / 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 sec.240.14a-11(c) or sec.240.14a-12
BIG B, INC.
(Name of Registrant as Specified In Its Charter)
BIG B, INC.
(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:
5) Total fee paid:
Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / 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> 1
BIG B, INC.
2600 Morgan Road, S.E.
Birmingham, Alabama 35023
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
May 28, 1996
TO THE SHAREHOLDERS:
The annual meeting of Shareholders of Big B, Inc. (the
"Company") will be held at the offices of the Company, 2600
Morgan Road, S.E., at Interstate 459, Birmingham, Alabama 35023,
on the 28th day of May, 1996, at 10:00 o'clock A.M., Central
Daylight Time, for the following purposes:
(1) To elect a Board of Directors to serve until the
next annual meeting or until their successors are duly elected.
(2) To consider and act upon a proposal to ratify the
engagement of the accounting firm of Arthur Andersen LLP as
independent public accountants for the current fiscal year.
(3) To transact such other business as may properly come
before the meeting or any adjournment thereof.
We hope you will attend the meeting and take an active part
in it. Details concerning those matters to come before the
meeting are set forth in the accompanying proxy statement for
your inspection. Whether you plan to attend the meeting or not,
please execute the enclosed proxy and return it in the return
envelope which is enclosed for your convenience.
The annual report of your Company for the fiscal year ended
February 3, 1996, is enclosed. We hope you will find it
informative.
Pursuant to a resolution adopted by the Board of Directors
of the Company, the close of business on April 1, 1996, has been
fixed as the date for determination of Shareholders entitled to
notice of this meeting and to vote at the meeting.
James A. Bruno,
Secretary
BY ORDER OF THE BOARD OF DIRECTORS
Dated April 27, 1996.
<PAGE>
<PAGE> 2
April 27, 1996
BIG B, INC.
2600 Morgan Road, S.E.
Birmingham, Alabama 35023
ANNUAL MEETING OF SHAREHOLDERS
May 28, 1996
PROXY STATEMENT
GENERAL
This Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Directors for use at the
annual meeting of Shareholders of Big B, Inc. ("Big B" or the
"Company") to be held on May 28, 1996. Please sign and return
the proxy in the enclosed return envelope so the Common Stock you
own will be voted in accordance with your wishes. Proxies may be
solicited by personal interview, telephone or mail. Banks,
brokerage houses and other custodians, nominees or fiduciaries
will be requested to forward soliciting materials to their
principals and to obtain authorization for the execution of
proxies, and will be reimbursed for their reasonable out-of-
pocket expenses incurred in that process. The Company will bear
the cost of the solicitation of proxies which is expected to be
nominal. The Company intends to cause this proxy statement to be
mailed to stockholders on or about April 27, 1996. The proxy
must be returned by May 27, 1996.
PROXY IS REVOCABLE
If, after you send in your proxy, you change your mind and
desire to revoke your proxy, you may do so by giving notification
of such intent to the Secretary of the Company in writing at any
time prior to the commencement of this annual meeting. Also,
your proxy may be revoked by submitting a later-dated proxy or by
attending the meeting and voting in person. Unmarked proxies
received by the Company will be voted in favor of each of the
proposals herein specified and as directed by the attorneys-in-
fact as to any other matter which may come before the meeting.
DATE OF RECORD
The close of business on April 1, 1996, has been set as the
record date for the purpose of determining Shareholders entitled
to vote at the annual meeting. Each share of Common Stock is
entitled to one vote on all matters.
OUTSTANDING SECURITIES
On April 1, 1996, there were issued and outstanding
18,572,647 shares of Common Stock of the Company, which
constitute all of the voting securities of the Company.
- 2 - <PAGE>
<PAGE> 3
BUSINESS TO BE CONSIDERED AT ANNUAL MEETING OF SHAREHOLDERS
It is expected that the following business will be
considered and action taken thereon at the annual meeting:
(1) To elect a Board of Directors to serve until the
next annual meeting or until their successors are duly elected.
(2) To ratify the engagement of the accounting firm of
Arthur Andersen LLP as independent public accountants for the
current fiscal year.
(3) To transact such other business as may properly
come before the meeting or any adjournment thereof.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The Company knows of no person (excluding officers and
Directors of the Company) who may be deemed to own beneficially
more than five percent of the outstanding Common Stock of the
Company.
The security ownership of all Directors and nominees and of
certain officers is set forth hereinafter.
BOARD OF DIRECTORS
The present Board of Directors consists of 7 members, all of
whom were elected to the Board of Directors at the Company's 1995
annual meeting of Shareholders. A Board of Directors consisting
of no less than 3 nor more than 12 persons is authorized by the
Big B, Inc. Certificate of Incorporation, as amended. As
provided in the Company's Bylaws, the Board of Directors has
fixed at 7 the present number of members to serve on the Board.
All of the present members of the Board of Directors are nominees
for election to the Board of Directors at this meeting. Each
nominee has expressed willingness to serve as a Director during
the coming year. Each Director is to serve for a term of one
year or until his successor is duly elected and qualified.
Proxies cannot be voted for a greater number of persons than the
number of nominees named. The seven nominees receiving the
highest number of votes at the annual meeting will be elected as
Directors. (Abstentions and broker non-votes will not affect the
tally of votes cast in the election. A "non-vote" occurs when a
broker, or other fiduciary, holding shares for a beneficial owner
votes on one proposal but lacks authority from the owner to vote
on another proposal.) It is the intention of the proxy holders
to vote FOR the election of all of the nominees listed below in
the absence of contrary direction. Should any nominee become
unavailable for election for any presently unforeseen reason, the
Board of Directors of the Company will determine how the proxies
will be voted.
- 3 - <PAGE>
<PAGE> 4
During the last fiscal year, the Board of Directors met on
four occasions. No incumbent Director attended fewer than 75% of
the aggregate number of Board and committee meetings on which
such Board member served. Directors fees of $1,000 each for the
Board meetings attended were paid to each non-employee Director
of the Company. The Company allows non-employee Directors to
elect to be paid Director fees in Common Stock of the Company,
and all of the non-employee Directors have elected to be paid in
Common Stock.
The Company has an Audit Committee consisting of Susan W.
Matlock, Richard Cohn and Charles A. McCallum, D.M.D., M.D.,
which met on one occasion during the past year. The purpose of
the Audit Committee is to advise the Board of Directors with
respect to the scope of the annual audit and with respect to any
recommendations made by the auditors of the Company concerning
the internal accounting controls of the Company. The Company has
a Compensation Committee consisting of Richard Cohn, Charles A.
McCallum, D.M.D., M.D., and Susan W. Matlock, which met on one
occasion during the past year. The purpose of the Compensation
Committee is to review and approve salaries and benefits for the
executive officers of the Company. The Company does not have a
Nominating Committee.
The principal occupation or employment of each nominee for
Director for the past five years, the year in which he or she
became a Director, and the number of shares of Common Stock of
the Company beneficially owned on April 1, 1996, are reflected in
the following table. Unless otherwise stated, the nominee
exercises sole voting and investment power over all shares of
Common Stock beneficially owned.
- 4 - <PAGE>
<PAGE> 5
<TABLE>
<CAPTION>
NOMINEES
Approximate Percent
Beneficial of Total
Principal Served Ownership Outstanding
Occupation as of Common Common
Name of for the Past Director Stock of Stock of
Nominee Five Years Age Since Company Company
- --------- --------------------------- --- -------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Anthony Chairman of 69 1979 816,129(1) 4.4%
J. Bruno the Board of the Company and
Chief Executive Officer since
1993; President of the
Company from 1979 to 1993
Arthur M. President and 48 1981 85,680(2) *
Jones, Sr. Chief Operating Officer of
the Company since 1993;
Executive Vice President and
Secretary/Treasurer from
1981 to 1993
Vincent Senior Vice- 53 1981 1,117,530(3) 6.0%**
J. Bruno President of Purchasing and
Advertising of the Company
James A. Executive Vice- 35 1993 100,403(4) *
Bruno President since 1995; Vice-
President of Marketing from
1987 to 1995; Secretary of
the Company since 1993
Richard Attorney: 53 1981 7,618(5) *
Cohn Sirote & Permutt, P.C.,
Counsel for the Company
Charles Professor of 69 1993 1,618 *
A. Medicine and Dentistry,
McCallum, University of
D.M.D., Alabama at Birmingham (UAB);
M.D. President of UAB
from 1987 to 1993
Susan W. Executive 49 1995 1,544(6) *
Matlock Director of Birmingham
Business Assistance Network
* Owns less than 1% of the total outstanding Common Stock of the
Company.
** Owns 5% or more of the total outstanding Common Stock of the
Company. The address for this beneficial owner of 5% or more
of the Company's Common Stock is c/o Big B, Inc., 2600 Morgan
Road, S.E., Birmingham, Alabama 35023.
</TABLE>
- 5 - <PAGE>
<PAGE> 6
(1) Includes 736,504 shares owned directly by Anthony J. Bruno;
and 77,200 shares owned by his wife, 925 shares held in the name
of his wife as custodian for their children, nephew, and
grandchild, and 1,500 shares held in the name of his wife as co-
trustee of a trust for the benefit of their children, as to which
he may be deemed to share voting and investment power.
(2) Includes 73,108 shares owned directly by Arthur M. Jones, Sr.
(of which 17,000 shares are represented by options exercisable
within sixty days by him under the Company's Employee Stock
Option Plan); 12,172 shares held jointly with his wife, and 400
shares held in the name of his wife as custodian for their
children, as to which he may be deemed to share voting and
investment power.
(3) Includes 408,254 shares owned directly by Vincent J. Bruno
(of which 13,500 shares are represented by options exercisable
within sixty days by him under the Company's Employee Stock
Option Plan); 114,100 shares held by him as custodian for his
children; 391,633 shares held by him as co-trustee of trusts for
the benefit of his children, 1,600 shares held jointly with his
wife, 174,964 shares owned by his wife, 18,735 shares held in the
name of his wife as trustee of a trust for the benefit of their
children; and 8,244 shares owned by the Lee Bruno Foundation, a
private charitable foundation, of which he is a Director, with
respect to which shares he disclaims any beneficial interest but
as to which he shares voting and investment power.
(4) Includes 99,534 shares owned directly by James A. Bruno (of
which 9,000 shares are represented by options exercisable within
sixty days by him under the Company's Employee Stock Option
Plan); and 869 shares held in the name of his spouse as custodian
for the benefit of his minor child.
(5) Includes 1,618 shares owned directly by Richard Cohn; and
6,000 shares held in the name of a partnership, as to which he
may be deemed to share voting and investment power. He also
serves as co-trustee of certain trusts with Vincent J. Bruno of
which neither he nor any member of his family is a beneficiary,
which own, in the aggregate 51,552 shares, as to which Mr. Cohn
may be deemed to share voting and investment power and as to
which he disclaims any beneficial ownership and which are not
included in the above total.
(6) Includes 872 shares owned directly by Susan W. Matlock, and
672 shares held jointly with her husband.
Vincent J. Bruno is the nephew of Anthony J. Bruno. James
A. Bruno is the son of Anthony J. Bruno. These three individuals
beneficially own, in the aggregate, 2,034,062 shares (of which
22,500 shares are represented by options exercisable within sixty
days by Vincent J. Bruno and James A. Bruno under the Company's
Employee Stock Option Plan), constituting approximately 10.95% of
the total outstanding Common Stock of the Company.
- 6 - <PAGE>
<PAGE> 7
All of the officers and Directors of the Company, as a group
(12 persons), beneficially owned, as of February 29, 1996,
2,255,900 shares (of which 55,250 shares are represented by
options which are exercisable within sixty days by members of the
group under the Company's Employee Stock Option Plan),
constituting approximately 12.2% of the total outstanding Common
Stock of the Company.
As required by the Securities and Exchange Commission rules
under Section 16 of the Securities and Exchange Act of 1934, the
Company notes that during 1995 no directors filed untimely
reports on transactions in the Company's Common Stock.
OFFICERS
The offices held by Anthony J. Bruno, Arthur M. Jones, Sr.,
Vincent J. Bruno and James A. Bruno are designated in the
Nominees chart appearing on page __ of this Proxy Statement.
Bobby W. Little, age 53, has been employed by Big B since 1972
and was elected Vice President of Store Operations in 1982 and
Senior Vice President of Store Operations in 1995. S. Steven
Taylor, age 44, has been employed by Big B since 1982 and was
elected Vice President of Real Estate and Store Development in
1987. Eugene A. Beckmann, age 47, has been employed by Big B
since 1984 and was elected Vice President of Human Resources in
1987. Michael J. Tortorice, age 49, has been employed by Big B
since 1973 and was elected Vice President of Finance in 1988,
Treasurer in 1994, and Chief Financial Officer in 1995. Paul B.
Bruno, age 37, has been employed by Big B since 1976 and was
elected Vice President of Merchandising in 1995.
The following table presents information concerning the
beneficial ownership of the Company's Common Stock by certain of
its executive officers on April 1, 1996.
<TABLE>
<CAPTION>
Stock Beneficially Owned
Name and Address Title of Class # of Shares(1) % of Class
- ------------------- ---------------- ------------- ------------
<S> <C> <C> <C>
Anthony J. Bruno Common 816,129 4.4%
Birmingham, AL
Arthur M. Jones, Sr. Common 85,680 .5%
Birmingham, AL
Vincent J. Bruno Common 1,117,530 6.0%
Birmingham, AL
James A. Bruno Common 100,403 .5%
Birmingham, AL
Bobby W. Little Common 37,537 .2%
Birmingham, AL
</TABLE>
- 7 - <PAGE>
<PAGE> 8
(1) The amounts shown represent the total shares beneficially
owned by such individuals together with shares which are issuable
upon the exercise of all stock options which are currently
exercisable. Specifically, the following individuals have the
right to acquire the shares indicated after their names, upon the
exercise of such options: Arthur M. Jones, Sr., 17,000; Vincent
J. Bruno, 13,500; and James A. Bruno, 9,000, and all officers and
directors as a group, 55,250.
COMPENSATION TO EXECUTIVE OFFICERS
The following table is a summary of certain information
concerning the compensation earned by the Company's chief
executive officer and each of the other five most highly
compensated executive officers during the last three fiscal
years.
<TABLE>
<CAPTION>
COMPENSATION
Long-Term All Other
Compen- Compen-
Annual Compensation sation sation(2)
------------------------ ----------- ---------
Other No.of
Annual Securities
Compen- Underlying
Name/ sation Options
Position Year Salary Bonus (1)
- -------- ---- -------- -------- ------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Anthony J. Bruno 1996 $266,000 $ -- __ -- $523,000
Chairman of the Board 1995 256,000 98,000 -- -- 45,000
CEO 1994 244,000 125,000 -- -- 48,000
Arthur M. Jones, Sr. 1996 216,000 __ $41,000 22,000 60,000
President and 1995 205,000 79,000 32,000 -- 29,000
Chief Operating Officer 1994 185,000 100,000 11,000 18,000 24,000
James A. Bruno 1996 140,000 -- 30,000 10,000 19,000
Executive Vice President;1995 107,000 47,000 -- -- 9,000
Secretary 1994 82,000 43,000 -- 7,000 8,000
Vincent J. Bruno 1996 127,000 -- 38,000 7,000 68,000
Senior Vice President 1995 120,000 46,000 -- -- 27,000
of Purchasing and 1994 114,000 59,000 40,000 8,000 30,000
Advertising
Bobby W. Little 1996 118,000 -- 16,000 7,000 54,000
Senior Vice President 1995 109,000 42,000 12,000 -- 25,000
of Store Operations 1994 101,000 53,000 -- 7,000 21,000
</TABLE>
- 8 - <PAGE>
<PAGE> 9
(1) Reflects amounts reimbursed by the Company for the payment of
taxes resulting from the exercise of stock options issued under
the Company's Employee Stock Option Plan. No amounts for
executive perquisites and other personal benefits, securities or
property are shown because the aggregate dollar amount per
executive is the lesser of 4either $50,000 or 10% of annual
salary and bonus.
(2) The amounts listed in this column represent (i) the Company's
contributions under its Profit Sharing Plan for the benefit of
the following executives for 1996, 1995, and 1994: Anthony J.
Bruno $6,000, $6,000 and $6,000; Arthur M. Jones, Sr. $6,000,
$6,000 and $6,000; James A. Bruno $6,000, $5,000 and $4,000;
Vincent J. Bruno $4,000, $6,000 and $6,000; and Bobby W. Little
$6,000, $4,000 and $4,000; (ii) amounts accrued by the Company in
1996, 1995, and 1994 under Employment and Deferred Compensation
Agreements to provide future retirement benefits for its
executives as follows: Anthony J. Bruno $390,000, $20,000 and
$25,000; Arthur M. Jones, Sr. $47,000, $20,000 and $15,000; James
A. Bruno $10,000, $2,000 and $2,000; Vincent J. Bruno $56,000,
$18,000 and $21,000; and Bobby W. Little $40,000, $18,000 and
$14,000; and (iii) annual premiums paid by the Company on life
insurance provided by the Company in 1996, 1995 and 1994 for the
benefit of its executives as follows: Anthony J. Bruno $127,000,
$19,000 and $17,000; Arthur M. Jones, Sr. $7,000, $3,000 and
$3,000; James A. Bruno $3,000, $2,000 and $2,000; Vincent J.
Bruno $8,000, $3,000 and $3,000; and Bobby W. Little $8,000,
$3,000 and $3,000.
COMPENSATION REPORT
The Company's Compensation Committee has established for
executives specific compensation policies which seek to enhance
the profitability of the Company with an appropriate balance
between long-term and short-term profitability goals and to
assure the ability of the Company to attract and retain executive
employees with compensation packages competitive in the
marketplace.
The compensation program of the Company seeks specifically
to motivate the executives of the Company to achieve objectives
which benefit the Company within their respective areas of
responsibility, with particular emphasis, in the following order
of priority, on the ultimate realization of profits for the
Company, continued growth in revenues, and control over operating
expenses through the achievement of operating efficiencies.
The key elements of the Company's compensation program
include base compensation, an incentive bonus, a Stock Option
Plan and retirement benefits typically offered to executives of
similar businesses.
- 9 - <PAGE>
<PAGE> 10
The Company has also sought to align the interests of the
executives with the long-term interests of the shareholders
through its Stock Option Plan and an attractive deferred
compensation plan for the executives.
The fiscal 1996 compensation of Anthony J. Bruno, the
Company's Chief Executive Officer, was based on a review of
salaries paid by other retail drug companies of a similar size to
that of the Company, taking into account the successful
performance of the Company during the preceding year and the
leadership provided by him in his role as CEO. The base salaries
of all of the executives are set on a general and subjective
basis after a review of certain factors, including salaries paid
by other retail drug companies of a similar size to that of the
Company for executives of similar experience and skills, the
overall performance by each executive during the preceding year,
the Company's financial performance during the preceding year,
and any changes in the scope of the executive's responsibilities
from the preceding year. In addition to base salary, each
executive, including the CEO, may earn a cash bonus of up to 50%
of base pay if certain earnings objectives, established at the
beginning of each fiscal year, are achieved with the maximum
potential bonus being reduced in proportion to any shortfall in
these set earnings objectives.
COMPENSATION COMMITTEE
Richard Cohn
Charles A. McCallum, D.M.D., M.D.
Susan W. Matlock
SHAREHOLDER RETURN PERFORMANCE
The following line graph compares the yearly percentage
change in the cumulative total shareholder return on the
Company's Common Stock against the cumulative total return of the
S&P Composite-500 Stock Index and the cumulative total return of
a published group index for the Chain Drug Store Industry (Peer
Group), provided by the National Association of Chain Drug
Stores, for the period of five fiscal years. The graph depicts
$100 invested at the close of trading in the last trading day
preceding the first day of the fifth preceding fiscal year in Big
B, Inc. Common Stock, the S&P 500, and the Peer Group. The
cumulative total return assumes reinvestment of dividends.
[INSERT GRAPH]
<TABLE>
<CAPTION>
1991 1992 1993 1994 1995 1996
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Big B, Inc. 100.00 158.23 273.07 327.74 394.87 283.64
S&P 500 100.00 122.70 135.67 153.15 153.97 213.00
Peer Group 100.00 126.00 132.00 134.00 167.00 233.00
</TABLE>
- 10 - <PAGE>
<PAGE> 11
<TABLE>
<CAPTION>
STOCK OPTION GRANTS
PRIVATE OPTION GRANTS IN LAST FISCAL YEAR
Name Options % of Exercise Expiration Potential
Granted Total or Base Date Value at
(#)(1) Options Price Assumed
Granted ($/Share) Rates of
to Stock Price
Employees Appreci-
in Fiscal ation for
Year Option
Terms(2)
5%($) 10%($)
- -------- -------- --------- -------- --------- ------- ---------
<S> <C> <C> <C> <C> <C> <C>
Anthony
J. Bruno 0 0 0 --- --- ---
Arthur M.
Jones, Sr. 22,000 22% 10.00 1/31/98 156,000 212,000
Vincent J.
Bruno 7,000 7% 10.00 1/31/98 50,000 67,000
James A.
Bruno 10,000 10% 10.00 1/31/98 71,000 96,000
Bobby W.
Little 7,000 7% 10.00 1/31/98 50,000 67,000
Total 46,000 46% 327,000 442,000
</TABLE>
(1) All options outstanding were issued under the Company's
Employee Stock Option Plan. Options are exercisable 50% on
January 31, 1996, and 50% on January 31, 1997, at a price of
$10.00 per share, with the options expiring January 31, 1998.
(2) Based upon the market price on the date of grant and an
annual appreciation at the rate stated of such market price
through the expiration date of such options. The dollar amounts
under these columns are the result of calculations at the 5% and
10% rates set by the SEC and, therefore, are not intended to
forecast possible future appreciation, if any, of the Company's
stock price. The Company did not use an alternative formula for
a grant date valuation, as the Company is not aware of any
formula which will determine with reasonable accuracy a present
value based on future unknown or volatile factors.
AGGREGATE OPTION EXERCISES AND OPTION VALUES
The following table shows information concerning the
exercise of stock options during the fiscal year 1996 by each of
the named executive officers and the fiscal year-end value of
unexercised options.
- 11 - <PAGE>
<PAGE> 12
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
Name Shares Value Number Number Value Value
acquired realized of of of of
on ($) securities securities unex- unex-
exercise underlying underlying ercised ercised
(#) unexer- unexer- in-the- in-the-
cised cised money money
options options options options
at FY-end at FY-end at FY- at FY-
(#) (#) ($) end
exercis- unexercis- exercis- unexer-
able able able cisable
- -------- ------ -------- ---------- ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Anthony
J. Bruno 0 0 0 0 0 0
Arthur
M. Jones,
Sr. 16,000 135,000 17,000 11,000 17,000 0
Vincent
J. Bruno 8,000 75,000 13,500 3,500 29,000 0
James
A. Bruno 7,000 60,000 9,000 5,000 12,000 0
Bobby
W. Little 3,500 32,000 3,500 3,500 0 0
Total 34,500 302,000 43,000 23,000 58,000 0
</TABLE>
RETIREMENT PLANS
Profit Sharing 401(k) Retirement Plan
The Company maintains a profit sharing cash and deferred
retirement plan pursuant to Section 401(k) of the Internal
Revenue Code of 1986, as amended. All employees who are not
eligible to participate in a union-sponsored or co-sponsored
qualified retirement plan will participate after one year of
service and attainment of age 21.
The Company may make discretionary contributions in an
amount determined annually by the Board of Directors. Company
contributions are allocated to each participant on the basis of
compensation. Participants may make contributions to the Plan on
a payroll deduction basis and the Company may make matching
contributions on behalf of each participant. A separate salary
- 12 - <PAGE>
<PAGE> 13
reduction account and matching employer contribution account are
maintained for each participant. All contributions are paid to
NationsBank, as Trustee, to hold, invest and reinvest the funds.
All accounts are vested at retirement, death or disability. Upon
any other termination of employment, matching and discretionary
contributions are vested after the fifth year of service.
Subject to certain restrictions and tax penalties, participants
may make early withdrawals from their salary reduction accounts.
Severance Agreements
The executive officers of the Company are parties to
Employment Continuity Agreements with the Company. Under the
terms of the Employment Continuity Agreements, a participating
executive will generally become entitled to receive benefits if
the executive's employment is terminated by the Company for "Good
Reason" or by the Company without "Cause" within two years
following a "Change of Control." For purposes of the Agreements,
a "Change of Control" is deemed to include (i) any acquisition of
stock if the acquiring person would thereafter be the beneficial
owner of 25% or more of the Company's voting stock, (ii) a merger
or consolidation of the Company in which the Company is not the
surviving corporation, (iii) a sale or exchange of all or
substantially all of the property and assets of the Company, or
(iv) any change over a two-year period or less in a majority of
the Board of Directors that is not approved by 2/3 of the
Directors either in office at the commencement of such two-year
period or who were elected with the approval of a majority of
Directors in office at the commencement of such two-year period.
The term "Cause" is defined to mean the commission of certain
crimes or a willful breach of duty if such neglect is not cured
within 30 days of notice. An executive's termination of
employment is deemed for "Good Reason" if any of the following
occurred within two years of such termination; (i) a substantial
change in the nature, or diminution in the status, of the
individual's duties or position, (ii) a reduction in the annual
base salary provided to the individual, (iii) removal from the
then current executive position, (iv) a failure to provide
substantially the same support staff, (v) a material reduction in
other benefits, (vi) relocation of the executive's principal
place of business outside Birmingham, Alabama, or (vii) a failure
to assume the Employment Continuity Agreement. The Company
considers it unlikely that the employment of all of the
executives anticipated to be covered under these Agreements would
be terminated following a Change of Control.
The benefits payable under these Employment Continuity
Agreements consist of a lump sum cash payment equal to three
times, for Anthony J. Bruno, Arthur M. Jones, Sr. and James A.
Bruno, two times for Vincent J. Bruno, Bobby W. Little and
Michael Tortorice, and one times for Eugene Beckmann, Steven
Taylor and Paul Bruno, the sum of the executive's average annual
compensation at the time of termination and his average incentive
compensation bonus for the three years preceding termination.
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<PAGE> 14
Other benefits provided include the continuation of certain
health, disability, and life insurance benefits for ten years.
Employment and Deferred Compensation Agreement
Employment and Deferred Compensation Agreements between the
Company and the executive officers of the Company provide that
certain retirement benefits are to be paid to those officers upon
their retirement after age 65 or after 25 years of employment
with the Company. These benefits become vested in the employee
ratably over a 25 year period until age 65 is reached at which
time full vesting is achieved. Cash retirement benefits in a
monthly amount equal to 4.2% of his average annual compensation
for the three fiscal years ended immediately prior to his
retirement date are to be paid to the employee for a period of
120 months following the date of his retirement. In addition, he
is entitled to participate in the Company's health insurance plan
for the remainder of his life. In the event of his death after
retirement and during such 120-month period, the Company will be
obligated to continue the payments to his spouse or heirs for the
remainder of the 120-month term. In the event an officer becomes
permanently disabled or dies prior to attaining age 65, the
Company will be obligated to make the monthly cash payments to
him, or to his wife or heirs in the event of his death, for such
120-month period. The Company accrues the present value of such
retirement benefits from the date of such agreement to the normal
retirement date. The occurrence of any event which entitles an
executive officer to receive payment under his Employment
Continuity Agreement is treated as a "retirement" under his
Employment and Deferred Compensation Agreement, entitling him to
receive payments thereunder and a right to elect to receive a
present value lump sum payment.
INTEREST OF OFFICERS, DIRECTORS AND OTHERS IN CERTAIN
TRANSACTIONS
Big B leases a drug store in Hoover, Alabama, from Nancy
Bruno, the mother of Vincent Bruno, Senior Vice President of
Purchasing and Advertising and a Director of the Company. The
annual minimum rental is $55,000, plus 2% of store sales
(excluding sales of beer, wine or tobacco products) in excess of
$2,750,000. For the last fiscal year, Nancy Bruno received no
payments under provisions relating to sales in excess of the
specified minimum. The term of this lease is through 2005.
The Company leases from Theresa L. Bruno, the sister-in-law
of Anthony J. Bruno, Chairman and CEO of the Company, five Big B
Drug Stores, located in Birmingham, Gadsden, Clanton and
Talladega, Alabama, and in Pensacola, Florida, under long-term
leases with remaining terms ranging from 5 to 10 years and with
three to four five-year renewal options. Each of the leases
provides for an annual minimum guaranteed rent, plus an
additional rent equal to 2% of annual sales in excess of a
specified amount for each of the five drug stores. Future
minimum lease payments under these net operating leases with
- 14 - <PAGE>
<PAGE> 15
noncancelable terms in excess of one year aggregate $1,816,000.
Minimum lease payments were $266,000 in fiscal 1996, $257,000 in
fiscal 1995, and $244,000 in fiscal 1994. No excess rentals were
paid in fiscal 1996, 1995, or 1994.
The Company utilizes the services of Perry Harper & Perry,
Inc., an advertising agency, located in Birmingham, Alabama, of
which Theresa Bruno, the wife of James A. Bruno, Executive Vice
President, Secretary and a Director of the Company, is a
shareholder and employee. In fiscal 1996, the Company paid to
Perry Harper & Perry approximately $234,800 of commissions for
its services.
In the opinion of Management and a majority of the
disinterested members of the Board of Directors, the terms of
each of these leases and the Company's arrangement with its
advertising agency are no less favorable than terms that could
have been obtained from unaffiliated parties.
SHAREHOLDERS LIST
A complete list of the Shareholders entitled to vote at the
annual meeting of Shareholders to be held on May 28, 1996, will
be available for inspection during normal business hours at the
principal office of the Company for a period of at least 10 days
prior to the meeting, upon written request to the Company by a
Shareholder, and at all times during the annual meeting at the
place of the meeting.
SELECTION OF AUDITORS
Arthur Andersen LLP, independent certified public
accountants, have performed an examination of the financial
statements of the Company for the fiscal year ended February 3,
1996. Services provided by Arthur Andersen LLP included work
related to the examination of the annual financial statements of
the Company, its Profit Sharing 401(k) Retirement Plan; reviews
of unaudited quarterly financial information; filings with the
Securities and Exchange Commission, and preparation of state and
federal income tax returns.
Arthur Andersen LLP, Suite 1800, 420 North 20th Street,
Birmingham, Alabama, is recommended for selection as independent
certified public accountant of the Company for the current fiscal
year. A representative of Arthur Andersen LLP is expected to
attend this meeting. He will be afforded the opportunity to make
a statement if he desires, and will be available to respond to
appropriate questions.
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<PAGE> 16
OTHER BUSINESS
As of the date of this Proxy Statement, Management knows of
no other business which will be presented for consideration at
the meeting.
BIG B, INC. WILL PROVIDE WITHOUT CHARGE A COPY OF ITS ANNUAL
REPORT ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND
SCHEDULES THERETO, FOR ITS FISCAL YEAR ENDED FEBRUARY 3, 1996, TO
ANY BENEFICIAL OWNER OF BIG B, INC. COMMON STOCK AS OF APRIL 1,
1996, WHO REQUESTS IN WRITING A COPY OF SUCH FROM ITS CORPORATE
SECRETARY, JAMES A. BRUNO, C/O BIG B, INC., POST OFFICE BOX
10166, BIRMINGHAM, ALABAMA 35202.
SHAREHOLDER PROPOSALS
SHAREHOLDER PROPOSALS TO BE PRESENTED FOR CONSIDERATION AT
THE NEXT ANNUAL MEETING OF SHAREHOLDERS OF THE COMPANY MUST BE
RECEIVED BY THE COMPANY NO LATER THAN DECEMBER 15, 1996.
INCORPORATION BY REFERENCE
The Consolidated Financial Statements of the Company and
Management's Discussion and Analysis of Financial Conditions and
Results of Operations, set forth in the Company's Annual Report
to Shareholders accompanying this Proxy Statement, are hereby
incorporated herein.
BIG B, INC.
By:_________________________
James A. Bruno,
Secretary
- 16 - <PAGE>
BIG B, INC.
Birmingham, Alabama
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR
THE ANNUAL MEETING OF SHAREHOLDERS ON THE 28TH DAY OF MAY, 1996.
The undersigned hereby appoints Anthony J. Bruno and Arthur M.
Jones, Sr., and each of them, each with the power to appoint his
substitute, attorneys with the powers the undersigned would
possess if personally present to vote all of the Common Stock of
Big B, Inc. held of record by the undersigned on April 1, 1996,
at the annual meeting of the Shareholders to be held on the 28th
day of May, 1996, at the offices of the Company, 2600 Morgan
Road, S.E., at Interstate 459, Bessemer, Alabama 35023, at 10:00
o'clock A.M., and at any adjournments thereof, upon the matters
set forth below and described in the notice and proxy statement
for said meeting, copies of which have been received by the
undersigned; and, in their discretion, upon all other matters
which may come before the meeting. Without otherwise limiting
the general authorization hereby given, said attorneys are
instructed to vote as follows on the matters set forth below:
(1) ELECTION OF DIRECTORS
FOR all nominees listed below [ ]
(except as marked to the contrary below)
WITHHOLD AUTHORITY [ ]
to vote for all nominees listed below
INSTRUCTION -- TO WITHHOLD AUTHORITY TO VOTE FOR ANY
INDIVIDUAL NOMINEE, STRIKE A LINE THROUGH THE NOMINEE'S NAME IN
THE LIST BELOW.
Anthony J. Bruno, Arthur M. Jones, Sr., Vincent J. Bruno,
James A. Bruno, Richard Cohn, Charles A. McCallum, D.M.D., M.D.,
Susan W. Matlock
(2) To ratify the engagement of the accounting firm of Arthur
Andersen LLP as independent public accountants for the current
fiscal year.
FOR: [ ] AGAINST: [ ] ABSTAIN: [ ]
(3) In their discretion, upon such other matters as may
properly come before the meeting.
AUTHORIZED: [ ] NOT AUTHORIZED: [ ]
<PAGE>
The shares represented by this proxy will be voted in
accordance with the specifications made by the undersigned
herein. IF NO SPECIFICATION IS MADE, THIS PROXY WILL BE VOTED IN
FAVOR OF EACH OF THE PROPOSALS HEREIN SPECIFIED AND AS DIRECTED
BY THE ATTORNEYS-IN-FACT AS TO ANY OTHER MATTERS WHICH MAY COME
BEFORE THE MEETING.
Please mark, sign, date and return this proxy in the
enclosed envelope as soon as possible, even though you plan to
attend this meeting.
To help our preparations for the meeting, please check here
if you plan to attend. [ ]
[SPACE FOR LABEL]
SIGN HERE EXACTLY AS NAME(S) APPEAR(S) ABOVE:
_____________________________________________
Date: _______________________________________
_____________________________________________
Date: _______________________________________
When shares are held by joint tenants, both should sign.
When signing as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a corporation,
please sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership
name by authorized person.
If your address has changed, please note new address:
