SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
FOODARAMA SUPERMARKETS, INC.
(Name of Registrant as Specified In Its Charter)
________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
|X| $125 per Exchange Act Rule 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:
_____________________________________________________________________________
|_| 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 No. ______________________________________
3) Filing party: ___________________________________________________________
4) Date filed: _____________________________________________________________
___________
*Set forth the amount on which the filing fee is calculated and state how it was
determined.
<PAGE>
FOODARAMA SUPERMARKETS, INC.
922 Highway 33
Building 6, Suite 1
Howell, New Jersey
-------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held May 1, 1996
-------------------------
The Annual Meeting of Shareholders (the "Meeting") of Foodarama
Supermarkets, Inc. (the "Company") will be held at the offices of the Company,
922 Highway 33, Building 6, Suite 1, Howell, New Jersey, on May 1, 1996 at 10:30
A.M. (local time), for the following purposes:
1. To elect a Board of four Directors; and
2. To transact such other business as may properly come before the
Meeting and any adjournment thereof.
The Board of Directors has fixed the close of business on April 9, 1996 as
the record date for determining the shareholders entitled to notice of and to
vote at the Meeting or any adjournment thereof. A list of shareholders as of the
record date will be available to shareholders at the Meeting.
YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING. SHAREHOLDERS WHO DO NOT
EXPECT TO BE ABLE TO ATTEND THE MEETING ARE REQUESTED TO FILL IN, DATE, SIGN AND
RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED ENVELOPE, WHICH DOES NOT REQUIRE
ADDITIONAL POSTAGE IF MAILED IN THE UNITED STATES. THIS WILL NOT PREVENT YOU
FROM VOTING IN PERSON IF YOU CAN BE PRESENT AT THE MEETING.
By Order of the Board of Directors,
/s/ RICHARD J. SAKER
Howell, New Jersey Richard J. Saker,
April 9, 1996 Secretary
1
<PAGE>
FOODARAMA SUPERMARKETS, INC.
922 Highway 33
Building 6, Suite 1
Howell, New Jersey
---------------
PROXY STATEMENT
---------------
GENERAL INFORMATION
This Proxy Statement and the accompanying form of proxy are being mailed to
shareholders of Foodarama Supermarkets, Inc. (the "Company") in connection with
the solicitation, by and on behalf of the management of the Company, of proxies
to be voted at the Annual Meeting of Shareholders (the "Annual Meeting") to be
held at the offices of the Company, 922 Highway 33, Building 6, Suite 1, Howell,
New Jersey, on May 1, 1996 at 10:30 A.M. (local time) and at all postponements
or adjournments thereof.
The securities entitled to vote at the Annual Meeting consist of shares of
Common Stock of the Company with each share of Common Stock entitling its owner
to one vote on an equal basis. The number of outstanding shares of Common Stock
on April 9, 1996 was 1,118,150. Only shareholders of record on the books of the
Company at the close of business on that date will be entitled to vote at the
meeting. The holders of a majority of the outstanding shares of Common Stock,
present in person or by proxy and entitled to vote, will constitute a quorum at
the meeting. The affirmative vote of a plurality of the shares present in person
or represented by proxy and entitled to vote is required for the election of
Directors. The proxy card provides space for a shareholder to withhold votes for
any or all nominees for the Board of Directors. All votes will be tabulated by
the inspector of election appointed for the Annual Meeting who will separately
tabulate affirmative votes, authority withheld for any nominee for Director and
any abstentions or broker non-votes. Authority withheld will be counted toward
the tabulation of total votes cast in the election of Directors and will have
the same effect as a negative vote. Any proxy submitted and containing an
abstention or a broker non-vote is not counted as a vote cast on any matter to
which it relates and will only be counted for purposes of determining whether a
quorum is present at the meeting.
All shares of Common Stock represented by properly executed proxies will be
voted at the Annual Meeting, unless such proxies have previously been revoked.
Unless otherwise instructed, the shares of Common Stock represented by such
proxies will be voted "for" the election of management's nominees for directors.
Management does not know of any other matter to be brought before the Annual
Meeting, but it is intended that, as to any such other matter, votes may be cast
pursuant to the proxies in accordance with the judgment of the person or persons
acting thereunder.
The Company's address is 922 Highway 33, Building 6, Suite 1, Howell, New
Jersey and its telephone number is (908) 462-4700. The notice, proxy statement
and enclosed form of proxy are being mailed to shareholders on or about April 9,
1996.
Any shareholder who executes and delivers a proxy may revoke it at any time
prior to its use by (a) delivering written notice of such revocation to the
Secretary of the Company at its offices; (b) delivering to the Secretary of the
Company a duly executed proxy bearing a later date; or (c) appearing at the
Annual Meeting and requesting the return of his or her proxy.
YOU ARE REQUESTED TO COMPLETE AND SIGN THE ACCOMPANYING PROXY AND RETURN IT
PROMPTLY IN THE ENVELOPE PROVIDED FOR THAT PURPOSE.
2
<PAGE>
FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES
================================================================================
PRINCIPAL
SHAREHOLDERS
The following table shows, as of April 9, 1996, the persons known to the Company
who owned directly or beneficially more than 5% of the outstanding Common Stock
of the Company:
Amount
Beneficially Percent of
Name of Beneficial Owner Owned Class
------------------------ ------------ ----------
Joseph J. Saker (1) (2) (3)........................ 346,376 31.0
Estate of Mary Saker (1) (3)....................... 73,296 6.6
Richard J. Saker (1) (2)........................... 78,539 7.0
Dimensional Fund Advisors, Inc. (4)................ 60,300 5.4
Horsburgh Carlson Investment Management, Inc. (5).. 77,400 6.9
Arthur N. Abbey (6)................................ 105,200 9.4
- --------------
(1) The address of the foregoing person is c/o Foodarama Supermarkets, Inc.,
922 Highway 33, Building 6, Suite 1, Freehold, New Jersey 07728.
(2) Includes 10,428 shares held by his wife and 36,648 shares willed to him by
Mary Saker. Does not include an aggregate of 135,967 shares owned by
Richard J. Saker and the other children of Joseph Saker in their own names,
of which Mr. Joseph J. Saker disclaims beneficial ownership.
(3) Mary Saker, deceased, was the mother of Joseph J. Saker. One-half or 36,648
of her shares have been willed to Joseph J. Saker.
(4) The address of Dimensional Fund Advisors, Inc. ("Dimensional"), a
registered investment advisor, is 1299 Ocean Avenue, Suite 650, Santa
Monica, California 90401. Based upon a copy of Amendment No. 4 to Schedule
13G signed on February 9, 1994 and filed with the Securities and Exchange
Commission, Dimensional is deemed to have beneficial ownership of 60,300
shares, all of which shares are held in portfolios of DFA Investment
Dimensions Group Inc. (the "Fund"), a registered open-end investment
company, or the DFA Group Trust, an investment vehicle for qualified
employee benefit plans, both of which Dimensional serves as investment
manager. Dimensional has sole voting power with respect to 34,400 shares
and persons who are officers of Dimensional also serve as officers of the
Fund and in such capacity such persons vote the remaining 25,900 shares.
Dimensional disclaims beneficial ownership of all such shares.
(5) The address of Horsburgh Carlson Investment Management, Inc. is 675 Third
Avenue, New York, New York 10017. Based upon a copy of Schedule 13G signed
on April 10, 1995 and filed with the Securities and Exchange Commission on
April 17, 1995, Horsburgh Carlson has shared voting power with several
investment advisory clients with respect to 77,400 shares.
(6) The address of Arthur N. Abbey is 212 East 39th Street, New York, N.Y.
10016. Based upon a copy of schedule 13D signed on July 5, 1995 and filed
with the Securities and Exchange Commission on July 5, 1995, Mr. Abbey has
sole voting power.
3
<PAGE>
FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES
================================================================================
SECURITIES OWNED
BY MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of the Company's Common Stock as of April 9, 1996, by each director of
the Company, the executive officers of the Company on such date and the
executive officers and directors as a group. Except as set forth in the
footnotes to this table, the shareholders have sole voting and investment power
over such shares.
<TABLE>
<CAPTION>
Amount
Beneficially Percent of
Name of Beneficial Owner Owned Class
------------------------ ------------ ----------
<S> <C> <C>
Joseph J. Saker (1) (2)............................................. 346,376 31.0
Richard J. Saker (1) (2)............................................ 78,539 7.0
Albert A. Zager (1)................................................. 1,500 *
Charles T. Parton (1)............................................... 1,750 *
Michael Shapiro(1).................................................. 2,000 *
Emory A. Altobelli (1).............................................. --
Carl L. Montanaro (1)............................................... 15 *
Robert V. Spires (1) ............................................... 500 *
Joseph C. Troilo (1) (3) ........................................... 1,652 *
Directors and Executive Officers as a group (9 persons) (2)(3)(4)... 432,332 38.7
</TABLE>
(*) Less than one percent.
(1) The address of the foregoing person is c/o Foodarama Supermarkets, Inc.,
922 Highway 33, Building 6, Suite 1, Freehold, New Jersey 07728.
(2) Includes 10,428 shares held by his wife and 36,648 shares willed to him by
Mary Saker. Does not include an aggregate of 135,967 shares owned by
Richard J. Saker and the other children of Joseph Saker in their own names,
of which Mr. Joseph J. Saker disclaims beneficial ownership.
(3) Does not include an aggregate of 250 shares held by Mr. Troilo's wife and
son, of which shares he disclaims beneficial ownership.
(4) Of the 432,332 shares, 428,165 are owned by the directors of the Company.
On February 16, 1993, the Company sold to Wakefern Food Corporation ("Wakefern")
136,000 shares of 8% Cumulative Convertible Preferred Stock (the "Preferred
Stock") par value of $12.50 per share for a total of $1,700,000. The Preferred
Stock, which is non-voting, is redeemable at any time in whole or in part at its
par value plus accrued and unpaid dividends, and must be redeemed at such price
by June 8, 1999 or earlier in the event of a "change of control" as defined or
other specified extraordinary events. The dividend rate of the Preferred Stock
increases at the rate of 2% per annum beginning in March, 1996. Unpaid dividends
are cumulative and compound from the date of issuance of the Preferred Stock,
and no dividends may be paid on the Common Stock unless the Registrant is
current in payment of dividends on the Preferred Stock. As of October 28, 1995,
cumulative dividends on the Preferred Stock, that have not been declared, are in
arrears in the amount of approximately $395,000. The Preferred Stock is
convertible at any time after March 31, 1996 into shares of the Common Stock of
the Company, at the then market value of such Common Stock, at a conversion
value of $12.50 per share of Preferred Stock, with the proviso that no more than
1,381,850 shares (representing the total of the Company's unissued and treasury
shares) may be issued on conversion of all of the Preferred Stock. Based on a
market price of the Company's Common Stock as of March 31,1996, the Preferred
Stock was convertible into a total of 100,000 shares. Because it is possible
that the Company may not be in a position to redeem the Preferred Stock prior to
the date on which it becomes convertible, the agreement pursuant to which the
Preferred Stock was sold to Wakefern provides that Messrs. Joseph J. Saker and
Richard J. Saker, each a director and executive officer of the Company, both
have an option at any time before an applicable redemption date to purchase all,
but not less than all, of the then outstanding shares of Preferred Stock at the
par value thereof plus accrued and unpaid dividends. Messrs. Joseph J. Saker and
Richard J. Saker have agreed with the Company that they will not exercise such
right except with the approval of the Board of Directors of the Company and will
not convert any shares of the Preferred Stock so acquired into Common Stock
except with the approval of a majority of the independent directors of the
Company. The Company knows of no other contractual arrangements which may at a
subsequent date result in a change in control of the Company.
The Company and Wakefern have agreed to amend certain provisions of the
Preferred Stock to (a) extend the date after which Wakefern shall be entitled to
convert the Preferred Stock to Common Stock from March 31, 1996 to March 31,
1997; and (b) defer the 2% increase in the dividend rate effective March 1996 to
March 1997. The Company intends to pay dividends in arrears of $457,000 in
connection with the amendment and as a result of the amendment does not expect
to redeem the Preferred Stock in fiscal 1996.
4
<PAGE>
================================================================================
NOMINEES AS
DIRECTORS
OF THE COMPANY
It is intended that the shares of the Company's Common Stock represented by
proxies solicited hereby will be voted for the four nominees listed below. If
for any reason any of the said nominees should be unable or unwilling to serve,
which is not now anticipated, the proxies will be voted for a substitute nominee
who will be designated by the Board of Directors. The Directors will be elected
to hold office until the next annual meeting and until their respective
successors are duly elected and qualified.
<TABLE>
<CAPTION>
Year First
Elected a
Name and Age Principal Occupation Director
------------ ------------------------- ---------
<S> <C> <C>
Joseph J. Saker (67)............................. Chairman of the Board and 1958
President of the Company
Richard J. Saker (44)............................ Executive Vice President - 1987
Operations and Secretary
of the Company
Charles T. Parton (54)........................... Executive Vice President 1995
and Treasurer-The Parton
Corporation
Albert A. Zager, Esquire (47).................... Partner-Carton, Witt, 1995
Arvanitis & Bariscillo,
Attorneys
</TABLE>
Mr. Joseph J. Saker has been President of the Company since its incorporation in
1958 and Chairman since 1971. In addition to his responsibilities with the
Company, he serves on the Board of Governors of the Food Marketing Educational
Foundation of St. Joseph's University (Philadelphia); is a member of the Board
of Directors of Wakefern Food Corporation, and is active in other community
affairs.
Mr. Richard J. Saker, a graduate of St. Joseph's University, has been employed
by the Company since 1969, and has served as Senior Vice President - Operations
from 1984 until 1995 at which time he assumed the position of Executive Vice
President of Operations. He is the son of Joseph J. Saker.
Mr. Parton has been a financial executive, consultant and Certified Financial
Planner for the last five years. He is the Executive Director of Jersey Shore
Medical Center Foundation. He is also a Director of Kuehne Chemical Co., Inc.
(chlorine and caustic soda products), and a Director of Concorde Science &
Technology, Inc., import brokers.
Mr. Zager has been a member of Carton, Witt, Arvanitis & Bariscillo since 1977.
He is President of the Board of Directors of the Center for Holocaust Studies of
Brookdale College and General Counsel for Jersey Shore Medical Center, Inc.
5
<PAGE>
FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES
================================================================================
DIRECTORS MEETINGS
AND COMMITTEES
The Company held five meetings of its Board of Directors during the fiscal year
ended October 28, 1995. (Joseph J. Saker, attended all but one of such meetings
of the Board of Directors.)
The Board of Directors of the Company has appointed Executive, Audit and Stock
Option Committees. The Board of Directors performs the functions of a board
compensation committee. The Executive Committee, which consists of Messrs.
Joseph J. Saker and Richard J. Saker, generally holds weekly meetings. The Audit
and Stock Option Committees both consist of Messrs. Parton and Zager. The Audit
Committee is responsible for recommending a firm of independent auditors for the
Company each year and reviews the results of the annual audit with the auditors.
During the fiscal year ended October 28, 1995, the Audit Committee held one
meeting and there were no meetings of the Stock Option Committee.
================================================================================
EXECUTIVE OFFICERS
OF THE COMPANY
The executive officers of the Company are as set forth below:
<TABLE>
<CAPTION>
Name Age Capacities in Which Served
---- --- --------------------------
<S> <C> <C>
Joseph J. Saker (1)........................... 67 Chairman of the Board and President
Richard J. Saker (1).......................... 44 Executive Vice President - Operations,
and Secretary
Michael Shapiro (2)........................... 54 Senior Vice President, Chief Financial
Officer and Treasurer
Emory A. Altobelli (3)........................ 55 Senior Vice President - Corporate
Subsidiaries and Services
Carl L. Montanaro (4)......................... 54 Senior Vice President - Sales and
Merchandising
Robert V. Spires (5) ......................... 42 Senior Vice President - Human
Resources and Labor Relations
Joseph C. Troilo (6) ......................... 62 Senior Vice President - Financial
Administration, Assistant Secretary
and Assistant Treasurer
</TABLE>
- -----------------
(1) See Nominees as Directors of the Company.
(2) Mr. Shapiro joined the Company on August 15, 1994 as Senior Vice President,
Chief Financial Officer and Treasurer. Prior to that he was Vice President,
Finance and Operations of Apex One, Inc. from January 1992 to April 1994.
From August 1989 to January 1992 he was Vice President Finance of Fidelity
Land Development Corporation.
(3) Mr. Altobelli has served as Senior Vice President - Corporate Subsidiaries
and Services since June 21, 1995. Prior to such date he served as Senior
Vice President - Administration since June 1990.
(4) Mr. Montanaro was promoted to Senior Vice President on June 21, 1995. From
March 1988 to such date he served as Vice President of Sales and
Merchandising.
(5) Mr. Spires was promoted to Senior Vice President on June 21, 1995. From
August 1991 to such date, he served as Vice President of Human Resources
and Labor Relations.
(6) Mr. Troilo has served as Senior Vice President - Financial Administration
since August 1994. From 1974 to such date, he served as Senior Vice
President - Finance.
6
<PAGE>
================================================================================
EXECUTIVE
COMPENSATION
The aggregate compensation paid or accrued by the Company during the last three
fiscal years ended October 30, 1993, October 29, 1994 and October 28, 1995, to
the Chief Executive Officer of the Company and to the four most highly
compensated executive officers (other than the Chief Executive Officer) whose
compensation in salary and bonus exceeded $100,000 in the last fiscal year is
set forth in the following table.
<TABLE>
<CAPTION>
Summary Compensation Table
--------------------------
Annual Compensation
------------------- All Other
Name and Principal Position Year Salary Bonus Compensation
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Joseph J. Saker................................ 1995 $224,900 $45,000 (1) $ 54,500 (2)
President and Chief Executive Officer 1994 159,893 25,800 (2)
1993 154,544 23,300 (2)
Richard J. Saker............................... 1995 227,453 40,000 (1) 176,000 (2)
Executive Vice President, 1994 137,850 103,400 (2)
Chief Operating Officer and Secretary 1993 132,444 103,300 (2)
Michael Shapiro................................ 1995 144,977 --
Senior Vice President, Chief Financial Officer 1994 30,672 --
and Treasurer 1993 -- --
Carl L. Montanaro.............................. 1995 117,388 1,400 (2)
Senior Vice President - 1994 96,986 17,100 (2)
Sales and Merchandising 1993 98,504 14,000 (2)
Emory A. Altobelli............................. 1995 115,328 21,600 (2)
Senior Vice President - 1994 109,836 34,500 (2)
Corporate Subsidiaries and Services 1993 105,877 33,100 (2)
</TABLE>
(1) Bonuses of $45,000 and $40,000 were paid to Joseph J. Saker and Richard J.
Saker, respectively, pursuant to a fiscal 1995 bonus program adopted by the
Board of Directors of the Company on May 30, 1995 for the Company's
President and Chief Executive Officer and Executive Vice President and
Chief Operating Officer (the "Bonus Program"). Under the Bonus Program,
Joseph J. Saker and Richard J. Saker were awarded $22,500 and $20,000,
respectively, contemporaneously with the Board's adoption of the Bonus
Program in recognition of their efforts in connection with the Company's
refinancing of its outstanding institutional indebtedness in February,
1995. The remaining bonus amounts of $22,500 and $20,000 were earned based
upon the achievement of certain corporate goals specified in the Bonus
Program.
(2) The amount set forth in this column represents compensation accrued for,
but not paid to, the applicable named executive officer under the Company's
Deferred Compensation Plan, which was approved by the Board of Directors on
January 17, 1989. This Plan covers five executive officers and other key
employees and is intended to supplement the Company's Pension Plan. Amounts
payable under the Deferred Compensation Plan are not payable until the
earlier of the death or retirement of the covered employee. The Company
anticipates paying for benefits as they become due out of current operating
income, but expects over the long term that such payments will be recouped
out of proceeds of life insurance purchased by the Company on the lives of
the Deferred Compensation Plan's beneficiaries. The current annual premiums
for all employees covered by this plan are approximately $50,000.
Amounts payable at retirement under the Deferred Compensation Plan range
from 40% to 50% of the employee's highest average salary, together with
bonuses over a five-year period less primary Social Security and pension
plan benefits, and are payable until death, but for a minimum of 120
months.
The Deferred Compensation Plan provides for a pre-retirement death benefit
of one-half the amount payable upon retirement, actuarially computed,
payable to the employee's beneficiary over 120 months. If the employee dies
after retirement, such employee's beneficiary will receive the same benefit
the employee would have received if the employee had lived for 120 months.
7
<PAGE>
FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES
================================================================================
PENSION PLAN
The Company maintains a defined benefit pension plan for eligible employees.
Full vesting occurs after five years of service. Benefits upon retirement prior
to age 65 are reduced actuarially. Benefits under the plan are determined by a
formula equal to .6% times the highest five consecutive year average of the
regular or base salary of a participant together with bonuses and other
compensation times the total years of service. The following sets forth the
estimated annual benefits payable upon normal retirement at age 65.
Years of Service
------------------------------------------------------
Remuneration 15 20 25 30 35
- --------------------------------------------------------------------------------
$100,000.............. $ 7,500 $10,000 $12,500 $15,000 $17,500
125,000.............. 9,375 12,500 15,625 18,750 21,875
150,000.............. 11,250 15,000 18,750 22,500 26,250
175,000.............. 13,125 17,500 21,875 26,250 30,625
200,000.............. 15,000 20,000 25,000 30,000 35,000
225,000.............. 16,875 22,500 28,125 33,750 39,375
250,000.............. 18,750 25,000 31,250 37,500 43,750
275,000.............. 20,625 27,500 34,375 41,250 48,125
300,000.............. 22,500 30,000 37,500 45,000 52,500
For purposes of vesting benefits under the Pension Plan, the Company has
credited Joseph J. Saker with 37 years of service; Richard J. Saker with 21
years of service; Michael Shapiro with 1 year of service; Emory A. Altobelli
with 12 years of service; and Carl L. Montanaro with 33 years of service.
Mr. Joseph Saker received a lump sum distribution of $403,878 in January 1995,
representing the amount of his vested interest in the Pension Plan.
================================================================================
DIRECTORS COMPENSATION
All non-employee directors receive, in addition to reimbursement for their
reasonable expenses associated with attendance at Board Meetings, an annual
retainer fee of $7,500 payable quarterly in advance, and a participation fee of
$1,000 for each meeting of the Board attended. All non-employee members of the
Audit Committee receive, in addition to reimbursement for their reasonable
expenses associated with attendance at Audit Committee Meetings, a fee of $1,000
for each Audit Committee meeting attended if held on a day other than a day on
which a Board meeting is held. All non-employee members of the Stock Option
Committee receive, in addition to reimbursement for their reasonable expenses
associated with attendance at Stock Option Committee Meetings, a fee of $500 for
each Stock Option Committee meeting attended if held on a day other than a day
on which a Board Meeting is held.
The Company paid a total of $15,500 during the fiscal year ended October 28,
1995 to directors who are not employees of the Company.
8
<PAGE>
================================================================================
COMPLIANCE WITH
REPORTING
REQUIREMENTS
The Company believes that, during the fiscal year ended October 28, 1995, all
filing requirements under Section 16(a) of the Securities Exchange Act of 1934,
as amended, applicable to its officers, directors and greater than ten percent
beneficial owners were complied with on a timely basis, except that Messrs.
Joseph J. Saker and Richard J. Saker failed to timely file reports, as to their
respective interest as Trustees, in shares held by the Company's Defined Benefit
Pension Plans.
================================================================================
COMPENSATION
COMMITTEE
INTERLOCKS AND
INSIDER
PARTICIPATION
IN COMPENSATION
DECISIONS
For the fiscal year ended October 28, 1995, the Board of Directors performed the
functions of a board compensation committee. Executive Officers who served on
the Board of Directors were Mr. Joseph J. Saker, Chairman of the Board,
President and Chief Executive Officer, and Mr. Richard J. Saker, Executive Vice
President, Chief Operating Officer, and Secretary.
================================================================================
COMPENSATION
REPORT OF THE
BOARD OF
DIRECTORS
The Board of Directors has acted as a Compensation Committee of the Board and
has acted upon the compensation paid to the Company's Chairman, President and
Chief Executive Officer and its Executive Vice President and Chief Operating
Officer. After evaluation of several factors, including compensation paid for
like positions in comparable companies and the minimal level of salary increases
for these positions over several years, the independent members of the Board of
Directors approved an increase in the salary paid to each of Mr. Joseph K.
Saker, President and Chief Executive Officer of the Company, and Mr. Richard J.
Saker, Executive Vice President and Chief Operating Officer of the Company, in
fiscal 1995. See "Executive Compensation--Summary Compensation Table." The
independent members of the Board of Directors believe that the compensation paid
to these executive officers was below that for like positions in comparable
companies. In addition, the independent members of the Board approved the Bonus
Program for fiscal 1995 for Mr. Joseph J. Saker and Mr. Richard Saker. The
corporate goals established for the 1995 Bonus Program were designed to reward
improvements in the Company's financial condition, which was considered by the
Board to be in the best interests of the shareholders. See "Executive
Compensation--Summary Compensation Table."
9
<PAGE>
FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES
================================================================================
PERFORMANCE
ANALYSIS
Set forth below is a line graph comparing the cumulative total return of the
Company, the AMEX Market Value Index and the AMEX Market Value Retail Index for
the five years commencing November 3, 1990 and ended October 28, 1995.
[THE FOLLOWING DATA WAS REPRESENTED AS A LINE GRAPH IN THE PRINTED MATERIAL]
Date Foodarama Amex Market Amex Market Retail
---- --------- ----------- ------------------
1990 100 100 100
1991 78 134 155
1992 58 133 128
1993 53 167 162
1994 52 159 149
1995 53 181 166
10
<PAGE>
================================================================================
CERTAIN
TRANSACTIONS
(a) Certain Business Relationships and Related Party Transactions
As required by the By-Laws of Wakefern, a retailer-owned food distribution
corporation which provides purchasing, warehousing and distribution services to
the Company as well as other retail supermarket chains, the obligations owed by
the Company to Wakefern are personally guaranteed by Joseph J. Saker and Richard
Saker. As of March 9, 1996 the Company was indebted to Wakefern in the amount of
approximately $14,800,000 for current charges in the ordinary course of
business. Wakefern presently requires each of its shareholders to invest up to
$450,000 in Wakefern's non-voting capital stock for each store operated by it,
computed in accordance with a formula based on the volume of such store's
purchases from Wakefern.
As of October 28, 1995, the Company had an 11% investment in Wakefern of
$7,527,000. As a shareholder member of Wakefern, the Company earns a share of an
annual Wakefern patronage dividend. The dividend is based on the distribution of
operating profits on a pro rata basis in proportion to the dollar volume of
business transacted by each member with Wakefern during each fiscal year.
As of October 29, 1994, the Company was indebted in connection with an
investment in Wakefern and a Wakefern affiliate. The debt of $939,750 was
non-interest bearing and payable in scheduled installments over a period of up
to four years. The debt due Wakefern was fully repaid on May 23, 1995 from part
of the proceeds from the sale by the Company of the two operating Pennsylvania
stores. Additional information with respect to the Company's relationship with
Wakefern is contained in the Company's 1995 Annual Report on Form 10-K and in
the notes to the Company's 1995 financial statements.
The Company also has an investment in Insure-Rite, Ltd., another company
affiliated with Wakefern, which was $788,000 at October 28, 1995 and October 29,
1994. Insure-Rite, Ltd. provides the Company with its general liability and
property insurance coverage. The Company paid $2,875,000 for such insurance
coverage in fiscal 1995 and believes that such amount is comparable the amount
that would be charged by a similarly situated unaffiliated general liability and
property insurer.
The Company leases from Joseph J. Saker, the President of the Company, and his
wife, doing business as Saker Enterprises, a 56,000 square foot supermarket in
Freehold, New Jersey, under a lease terminating in 2003. The Company also leases
from Saker Enterprises a 5,400 square foot garden center building and 5,000
square feet of yard area on a month to month basis and 9,000 square feet of
space for its liquor store under a lease expiring December 31, 2003, both of
which are located in the same shopping center as the supermarket. During the
fiscal year ended October 28, 1995, aggregate amounts for rent (including taxes
and insurance) of $496,000, $42,000 and $121,000 were paid by the Company to
Saker Enterprises for the supermarket, garden center and liquor store,
respectively.
The Company believes that the terms of the foregoing transactions are comparable
to those available for non-affiliated persons in the respective localities.
See "Securities Owned by Management" for information with respect to the sale of
Preferred Stock to Wakefern Food Corporation and certain options granted to
Joseph J. Saker and Richard J. Saker with respect thereto.
(b) Indebtedness of Management
Joseph J. Saker, President of the Company, and doing business as Saker
Enterprises, is indebted to the Company for advances made for construction on
the South Freehold shopping center and other advances, which in total aggregated
$791,057 as of October 28, 1995 including accrued interest at 9% per annum
through October 28, 1995. The debt is evidenced by notes payable in twelve equal
quarterly installments of $75,466 commencing July 1, 1996 which payments include
interest at 9% per annum.
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<PAGE>
FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES
================================================================================
INDEPENDENT
CERTIFIED PUBLIC
ACCOUNTANTS
The firm of Deloitte & Touche, Independent Certified Public Accountants, was
retained as auditors to the Company for the year ended October 28, 1995, as
recommended by the Audit Committee. The selection of the independent public
accountants for the Company is made by the Board of Directors. A representative
of Deloitte & Touche will be present at the meeting to make a statement, if
desired, and to respond to appropriate questions.
================================================================================
ANNUAL REPORT
The Company's Annual Report to shareholders for the fiscal year ended October
28, 1995, including financial statements, which Annual Report is not part of
this proxy solicitation material, is being mailed to shareholders with the proxy
solicitation. On written request, the Company will provide without charge to
each record or beneficial holder of the Company's Common Stock, a copy of the
Company's Annual Report on Form 10-K as filed with the Securities and Exchange
Commission for the fiscal year ended October 28, 1995. Requests should be
addressed to Mr. Joseph C. Troilo, Senior Vice President-Financial
Administration, Foodarama Supermarkets, Inc., 922 Highway 33, Building 6, Suite
1, Freehold, New Jersey 07728.
================================================================================
OTHER BUSINESS
Management is not aware at this time of any other matters to be presented for
action. If however, any other matters properly come before the Annual Meeting,
unless otherwise directed, the persons named on the proxy intend to vote in
accordance with their judgment on the matters presented.
================================================================================
PROXY
SOLICITATION
The cost of solicitation of proxies will be borne by the Company. Such
solicitation will be made by mail and may also be made by the Company's
directors, officers, or regular employees personally or by telephone or
telegraph. Brokerage houses, nominees, fiduciaries and other custodians will be
requested to forward soliciting materials to beneficial owners of shares and
will be reimbursed by the Company for their reasonable expenses. The Company
does not expect to pay any compensation to third parties for the solicitation of
proxies, unless such solicitation has been requested by the Company.
================================================================================
SHAREHOLDER
PROPOSALS
A shareholder of the Company who wishes to present a proposal for action at the
Company's 1997 annual meeting of shareholders must submit such proposal to the
Company and such proposal must be received by the Company by December 20, 1996.
By Order of the Board of Directors,
/S/RICHARD J. SAKER
Howell, New Jersey Richard J. Saker,
April 9, 1996 Secretary
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