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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
International Multifoods Corporation
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
------------------------------------------------------------------------
<PAGE>
[LOGO]
INTERNATIONAL MULTIFOODS CORPORATION
33 SOUTH 6TH STREET
P.O. BOX 2942
MINNEAPOLIS, MINNESOTA 55402
612-340-3300
MAY 15, 1995
Dear Stockholder:
I am pleased to invite you to attend the Annual Meeting of Stockholders of
International Multifoods Corporation which will be held on Friday, June 16,
1995, at 10:00 a.m. local time, in the Lutheran Brotherhood Auditorium, 625
Fourth Avenue South, Minneapolis, Minnesota. The attached Notice of Annual
Meeting of Stockholders and Proxy Statement describe the matters to be acted
upon during the meeting.
Your copy of the Annual Report to Stockholders for the fiscal year ended
February 28, 1995 is enclosed or has been sent to you.
WE HOPE THAT YOU WILL BE ABLE TO ATTEND THE MEETING. WHETHER OR NOT YOU PLAN
TO ATTEND THE MEETING, PLEASE PROMPTLY COMPLETE, SIGN, DATE AND RETURN YOUR
PROXY CARD IN THE ENCLOSED ENVELOPE IN ORDER TO MAKE CERTAIN THAT YOUR SHARES
WILL BE REPRESENTED AT THE MEETING.
Sincerely,
[LOGO]
CHAIRMAN, PRESIDENT AND
CHIEF EXECUTIVE OFFICER
<PAGE>
INTERNATIONAL MULTIFOODS CORPORATION
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JUNE 16, 1995
TO THE STOCKHOLDERS OF
INTERNATIONAL MULTIFOODS CORPORATION:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
International Multifoods Corporation (the "Company") will be held on Friday,
June 16, 1995, at 10:00 a.m. local time, in the Lutheran Brotherhood Auditorium,
625 Fourth Avenue South, Minneapolis, Minnesota, for the following purposes:
1. To elect three directors for a term of three years;
2. To consider and vote on a proposal to approve the appointment by the
Board of Directors of the Company of KPMG Peat Marwick LLP as independent
auditors of the Company for the fiscal year ending February 29, 1996; and
3. To transact such other business as may properly come before the meeting
or any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on May 1, 1995 as the
record date for the determination of stockholders entitled to notice of and to
vote at the Annual Meeting of Stockholders and any adjournment thereof.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE COMPLETE, SIGN AND
DATE THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE WHICH
NEEDS NO POSTAGE STAMP IF MAILED IN THE UNITED STATES.
By Order of the Board of Directors,
FRANK W. BONVINO
SECRETARY
May 15, 1995
<PAGE>
INTERNATIONAL MULTIFOODS CORPORATION
33 SOUTH 6TH STREET
P.O. BOX 2942
MINNEAPOLIS, MINNESOTA 55402
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD JUNE 16, 1995
GENERAL MATTERS
SOLICITATION OF PROXIES
This Proxy Statement is furnished to stockholders of International
Multifoods Corporation (the "Company") in connection with the solicitation of
proxies by the Board of Directors of the Company for use at the Annual Meeting
of Stockholders of the Company to be held on June 16, 1995, and any adjournment
thereof (the "Annual Meeting"), for the purposes set forth in the accompanying
Notice of Annual Meeting of Stockholders. This Proxy Statement and the enclosed
form of proxy, along with the Company's Annual Report to Stockholders, are first
being sent to stockholders of the Company on or about May 15, 1995. The costs of
solicitation, including the cost of preparing and mailing this Proxy Statement,
are being paid by the Company. The Company has retained Morrow & Co., Inc. to
assist in the solicitation of proxies from stockholders for a fee of $4,500 plus
out-of-pocket expenses. The solicitation by mail may be followed by solicitation
in person, or by telephone or facsimile, by regular employees of the Company
without additional compensation or by employees of Morrow & Co., Inc. The
Company will reimburse brokers, banks and other custodians and nominees for
their reasonable out-of-pocket expenses incurred in sending proxy materials to
beneficial owners of Voting Stock (as defined below).
VOTING PROCEDURES
Only stockholders of record at the close of business on May 1, 1995 will be
entitled to vote at the Annual Meeting. As of that date, there were 17,995,362
shares of Common Stock, par value $.10 per share ("Common Stock"), and 35,542
shares of Cumulative Redeemable Sinking Fund First Preferred Capital Stock,
Series A, C, D and E, par value $100 per share ("First Preferred Stock"), issued
and outstanding and entitled to vote at the Annual Meeting (the "Voting Stock").
Holders of Common Stock and First Preferred Stock, voting together and not by
classes, are entitled to one vote for each share held.
The presence at the Annual Meeting, in person or by proxy, of the holders of
a majority of the shares of Voting Stock will constitute a quorum for the
transaction of business at the Annual Meeting. Assuming a quorum is present, the
three director nominees receiving a plurality of the votes cast at the Annual
Meeting by the holders of Voting Stock present in person or represented by proxy
will be elected directors. With respect to the approval of all other matters to
come before the Annual Meeting, including the appointment of KPMG Peat Marwick
LLP as the independent auditors of the Company, the affirmative vote of a
majority of the total votes cast at the Annual Meeting by the holders of Voting
Stock present in person or represented by proxy will be required.
A proxy, in the accompanying form, which is properly signed, received in
time for the Annual Meeting and not revoked will be voted in accordance with the
instructions contained thereon. With respect to the election of directors, a
stockholder may (i) vote for the nominees named herein as a group, (ii) withhold
authority to vote for the nominees as a group or (iii) vote for such nominees
other than any nominee the stockholder identifies in the appropriate space on
the proxy. With respect to each other matter submitted to the stockholders for a
vote, a stockholder may (i) vote "FOR" the matter, (ii) vote "AGAINST" the
matter or (iii) "ABSTAIN" from voting on the matter. If a stockholder elects to
abstain from voting on any matter, such abstention will be deemed to be a vote
cast at the Annual Meeting and therefore will have the effect of a vote against
such matter. If no specific instructions are indicated on the proxy, the shares
represented thereby will be voted FOR (i) the election of the three directors as
nominated and (ii) the approval of the appointment of KPMG Peat Marwick LLP as
the independent auditors of the Company and, with respect to such other matters
that may properly come before the Annual Meeting, in accordance with the
judgment of the persons named as proxies in
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the enclosed proxy. If a broker indicates on the proxy that it does not have
authority as to certain shares to vote on a particular matter, those shares will
not be considered as votes cast with respect to that matter and, therefore, will
not affect the outcome of the vote with respect to that matter.
A proxy may be revoked at any time prior to its exercise by giving written
notice of revocation to the Secretary of the Company, by submitting a properly
signed proxy that is dated subsequent to the earlier proxy or by written
revocation delivered in person at the Annual Meeting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of March 15, 1995 (unless otherwise
noted), certain information with respect to all stockholders known to the
Company to be the beneficial owners of more than 5% of the Company's Common
Stock and certain information with respect to the beneficial ownership of shares
of the Company's Common Stock by each director, nominee and executive officer of
the Company named in the Summary Compensation Table under the heading "Executive
Compensation" below and all directors and executive officers of the Company as a
group. None of the listed persons own any of the Company's First Preferred
Stock. Unless otherwise noted, the stockholders listed in the table have sole
voting and investment powers with respect to the shares of Common Stock owned by
them.
<TABLE>
<CAPTION>
AMOUNT AND PERCENT OF
NAME AND ADDRESS NATURE OF COMMON STOCK
OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP OUTSTANDING
- --------------------------------------------- -------------------- ------------
<S> <C> <C>
Archer-Daniels-Midland Company............... 1,621,650(1) 9.00%
4666 Faries Parkway
Decatur, Illinois 62526
State of Wisconsin Investment Board.......... 1,415,000(2) 7.86%
P.O. Box 7842
Madison, Wisconsin 53707
Anthony Luiso................................ 429,367(3) 2.34%
Duncan H. Cocroft............................ 152,166(4) *
Jay I. Johnson............................... 147,842(5) *
Robert F. Maddocks........................... 130,769(6) *
John E. Sampson.............................. 62,260(7) *
Peter S. Willmott............................ 42,815(8) *
James G. Fifield............................. 29,302(9) *
Robert M. Price.............................. 24,778(10) *
William A. Andres............................ 20,324(11) *
Nicholas L. Reding........................... 16,300(11) *
Jack D. Rehm................................. 12,741(12) *
Lois D. Rice................................. 8,825(13) *
All Executive Officers and Directors
as a Group (14 persons).................... 1,131,707(14) 5.98%
<FN>
- ----------
* Less than 1%
(1) The information was reported on an amended Schedule 13D, dated June 4,
1993.
(2) The information was reported on Schedule 13G, dated February 13, 1995.
</TABLE>
2
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<TABLE>
<S> <C>
(3) Includes 344,746 shares issuable pursuant to stock options which are
currently exercisable or which will become exercisable prior to May 15,
1995 and 4,586 shares held in trust for the benefit of Mr. Luiso under the
Employees' Voluntary Investment and Savings Plan of the Company (the
"Savings Plan").
(4) Includes 125,682 shares issuable pursuant to stock options which are
currently exercisable or which will become exercisable prior to May 15,
1995 and 2,573 shares held in trust for the benefit of Mr. Cocroft under
the Savings Plan.
(5) Includes 124,682 shares issuable pursuant to stock options which are
currently exercisable or which will become exercisable prior to May 15,
1995 and 1,884 shares held in trust for the benefit of Mr. Johnson under
the Savings Plan.
(6) Includes 112,432 shares issuable pursuant to stock options which are
currently exercisable or which will become exercisable prior to May 15,
1995 and 2,464 shares held in trust for the benefit of Dr. Maddocks under
the Savings Plan.
(7) Includes 42,750 shares issuable pursuant to stock options which are
currently exercisable and 4,810 shares held in trust for the benefit of Mr.
Sampson under the Savings Plan.
(8) Includes 27,815 shares issuable pursuant to stock options which are
currently exercisable.
(9) Includes 23,302 shares issuable pursuant to stock options which are
currently exercisable.
(10) Includes 23,653 shares issuable pursuant to stock options which are
currently exercisable and 800 shares held by Mr. Price in joint tenancy
with his wife.
(11) Includes 15,000 shares issuable pursuant to stock options which are
currently exercisable.
(12) Includes 9,000 shares issuable pursuant to stock options which are
currently exercisable and 171 shares held by Mr. Rehm in joint tenancy with
his wife.
(13) Includes 8,163 shares issuable pursuant to stock options which are
currently exercisable.
(14) Includes 906,050 shares issuable pursuant to stock options which are
currently exercisable or which will become exercisable prior to May 15,
1995, 22,488 shares held in trust for the benefit of the executive officers
under the Savings Plan and 141 shares held in trust for the benefit of an
executive officer under the Stock Purchase Plan of Robin Hood Multifoods
Inc., an indirect wholly-owned subsidiary of the Company.
</TABLE>
ELECTION OF DIRECTORS
The Board of Directors of the Company is currently composed of eight members
divided into three classes. The members of each class are elected to serve
three-year terms with the term of office of each class ending in successive
years. Anthony Luiso, Lois D. Rice and Peter S. Willmott are the directors in
the class whose term expires at the Annual Meeting. The Board of Directors has
nominated Messrs. Luiso and Willmott and Mrs. Rice for election to the Board of
Directors at the Annual Meeting for a term of three years, and each has agreed
to serve if elected. The other directors of the Company will continue in office
for their existing terms. William A. Andres, James G. Fifield and Robert M.
Price are the directors in the class whose term expires in 1996. Nicholas L.
Reding and Jack D. Rehm are the directors in the class whose term expires in
1997. Proxies solicited by the Board of Directors will, unless otherwise
directed, be voted for the election of the nominees named. In the event that any
nominee becomes unavailable for election at the Annual Meeting, the persons
named as proxies will vote for a substitute nominee as recommended by the Board
of Directors.
The following sets forth certain biographical information, present
occupation and business experience for the past five years for each director and
director nominee:
3
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<TABLE>
<S> <C>
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WILLIAM A. ANDRES, 68 Director since 1978
[PHOTO] Mr. Andres was Chairman of the Board of Dayton Hudson Corporation
(retail merchandising) prior to August 1984. Mr. Andres was also
Chairman of the Executive Committee of the Board of Directors of Dayton
Hudson Corporation prior to September 1985. Mr. Andres is a director of
Hannaford Bros. Company, Jostens, Inc., Lowes, Inc. and Scott Paper
Company.
- --------------------------------------------------------------------------------------------------
JAMES G. FIFIELD, 53 Director since 1990
[PHOTO] Mr. Fifield is President and Chief Executive Officer of EMI Music
(recording and music publishing), which office he has held since April
1989. Mr. Fifield is a director of THORN EMI plc.
- --------------------------------------------------------------------------------------------------
ANTHONY LUISO, 51 Director since 1988
[PHOTO] Mr. Luiso is Chairman of the Board, President and Chief Executive
Officer of the Company, which office he has held since July 1989. Mr.
Luiso is a director of Black & Decker Corporation and Mac Frugal's
Bargains - Close-outs, Inc.
- --------------------------------------------------------------------------------------------------
ROBERT M. PRICE, 64 Director since 1983
[PHOTO] Mr. Price is President of PSV, Inc. (management consulting--technology
and strategy), which position he has held since May 1990. Prior to May
1990, Mr. Price was Chairman of the Board of Control Data Corporation.
Mr. Price is a director of Fourth Shift Corp., Premark International,
Inc., Public Service Company of New Mexico and Rohr Industries, Inc.
- --------------------------------------------------------------------------------------------------
</TABLE>
4
<PAGE>
<TABLE>
<S> <C>
- --------------------------------------------------------------------------------------------------
NICHOLAS L. REDING, 60 Director since 1988
[PHOTO] Mr. Reding is Vice Chairman of the Board of Monsanto Company (chemicals,
agriculture and pharmaceuticals), which office he has held since January
1993. From June 1990 to January 1993, Mr. Reding was Executive Vice
President-- Environment, Safety, Health & Manufacturing of Monsanto
Company. Prior to June 1990, Mr. Reding was Executive Vice President of
Monsanto Company and President of Monsanto Agriculture Company. Mr.
Reding is a director of Monsanto Company, CPI Corp. and Meredith
Corporation.
- --------------------------------------------------------------------------------------------------
JACK D. REHM, 62 Director since 1991
[PHOTO] Mr. Rehm is Chairman of the Board and Chief Executive Officer of
Meredith Corporation (diversified media), which office he has held since
July 1994. From July 1992 to July 1994, Mr. Rehm was Chairman of the
Board, President and Chief Executive Officer of Meredith Corporation.
Prior to July 1992, Mr. Rehm was President and Chief Executive Officer
of Meredith Corporation. Mr. Rehm is a director of Meredith Corporation
and Equitable of Iowa Companies, Inc.
- --------------------------------------------------------------------------------------------------
LOIS D. RICE, 62 Director since 1991
[PHOTO] Mrs. Rice is a guest scholar at The Brookings Institution (an education
and public policy research organization), which position she has held
since October 1991. Prior to October 1991, Mrs. Rice was Senior Vice
President-- Governmental Affairs and a director of Control Data
Corporation. Mrs. Rice is a director of Bell Atlantic - Washington,
D.C., Inc., Hartford Steam Boiler Inspection & Insurance Co.,
McGraw-Hill, Inc., Shawmut National Corp. and UNUM Corporation.
- --------------------------------------------------------------------------------------------------
PETER S. WILLMOTT, 57 Director since 1988
[PHOTO] Mr. Willmott is Chairman of the Board and Chief Executive Officer of
Willmott Services, Inc. (business consulting and retail), which position
he has held since June 1989. Mr. Willmott is a director of
Browning-Ferris Industries Inc., Federal Express Corporation, Mac
Frugal's Bargains - Close-outs, Inc., Maytag Corporation, Morgan Keegan
& Co., Inc. and Zenith Electronics Corporation.
- --------------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE>
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors held eight meetings during the fiscal year ended
February 28, 1995, five of which were regularly scheduled meetings and three of
which were special meetings. During the fiscal year, each director attended at
least 75% of the aggregate of the total number of meetings of the Board of
Directors plus the total number of meetings held by all committees of the Board
on which he or she served. The Board of Directors has several committees which
are described below.
AUDIT COMMITTEE. Messrs. Andres, Price, Rehm and Willmott and Mrs. Rice are
members of the Audit Committee. The Audit Committee recommends to the Board of
Directors annually the selection of independent accountants, reviews the
activities and reports of the Company's independent accountants, reviews the
financial statements to be included in the Annual Report to Stockholders and
recommends approval by the Board of Directors, monitors accounting and financial
reporting practices throughout the Company, reviews internal accounting controls
and monitors compliance with the Company's prescribed procedures, policies and
code of ethics. The Audit Committee held three meetings during the fiscal year
ended February 28, 1995.
BENEFIT INVESTMENT COMMITTEE. Messrs. Reding, Rehm and Willmott and Mrs.
Rice are members of the Benefit Investment Committee. The Benefit Investment
Committee establishes investment policies and guidelines for employee benefit
plans, approves investment managers of employee benefit plan assets and reviews
investment performance of such plan assets. The Benefit Investment Committee
held three meetings during the fiscal year ended February 28, 1995.
COMPENSATION COMMITTEE. Messrs. Andres, Fifield, Price and Reding are
members of the Compensation Committee. The Compensation Committee approves the
compensation policies of the Company, determines the compensation paid to
officers of the Company, makes recommendations to the Board of Directors with
respect to the cash compensation of the Chief Executive Officer of the Company
and establishes and reviews performance standards under compensation programs
for officers of the Company. The Compensation Committee administers the
Company's stock option, stock-based incentive and bonus plans and makes grants
or awards under such plans. The Compensation Committee also recommends to the
Board of Directors the adoption of or amendments to employee benefit plans and
stock-based incentive plans of the Company. The Compensation Committee held five
meetings during the fiscal year ended February 28, 1995.
EXECUTIVE COMMITTEE. Messrs. Andres, Luiso, Price, Reding, Rehm and Willmott
are members of the Executive Committee. The Executive Committee has such powers
and authority as may be expressly conferred upon it from time to time by the
Board of Directors. The Executive Committee did not hold any meetings during the
fiscal year ended February 28, 1995.
FINANCE COMMITTEE. Messrs. Luiso, Price, Rehm and Willmott are members of
the Finance Committee. The Finance Committee reviews the capital structure,
source and use of funds and financial position of the Company, makes periodic
reports to the Board of Directors on such reviews and provides advice and
counsel regarding financial policies to management of the Company and the Board
of Directors. The Finance Committee held four meetings during the fiscal year
ended February 28, 1995.
NOMINATING COMMITTEE. Messrs. Fifield, Price and Reding and Mrs. Rice are
members of the Nominating Committee. The Nominating Committee reviews, evaluates
and recommends director candidates for nomination by the Board of Directors and
establishes guidelines for the Board of Directors in considering nominees. The
Nominating Committee will consider nominees recommended by stockholders if a
written recommendation is submitted to the Secretary of the Company at least 90
days prior to the date of the annual meeting of stockholders, along with the
written consent of such nominee to serve as director. The Nominating Committee
held one meeting during the fiscal year ended February 28, 1995.
COMPENSATION OF DIRECTORS
Directors who are not employees of the Company each receive an annual
retainer of $20,000 plus $1,000 for each meeting of the Board of Directors
($1,250 for meetings lasting more than one day) and $1,000 for each meeting of
any committee thereof ($1,250 in the case of the chairman of such committee)
that the director
6
<PAGE>
attends. Directors may elect to receive all or part of the amount of their
annual retainer and meeting fees in shares of restricted Common Stock or options
to purchase shares of Common Stock under the Company's Amended and Restated 1989
Stock-Based Incentive Plan. During the fiscal year ended February 28, 1995,
Messrs. Andres, Fifield, Price, Rehm and Willmott and Mrs. Rice made such
election. Amounts received by a director also may be deferred pursuant to the
Company's Fee Deferral Plan for Non-Employee Directors for a minimum period of
two years. Interest is paid on deferred amounts at a rate which is calculated
quarterly and corresponds to the Company's short-term borrowing rate then in
effect. None of the directors deferred compensation under such plan during the
fiscal year ended February 28, 1995.
In addition, on the first business day in July of each year, each director
who is not an employee of the Company is granted a nonqualified stock option to
purchase 1,500 shares of Common Stock at a purchase price per share equal to the
fair market value of a share of Common Stock on such date.
Directors who are also employees of the Company are not separately
compensated for any services provided as a director.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
COMPENSATION PHILOSOPHY
The philosophy of the Compensation Committee (the "Committee") with respect
to the compensation of the Company's executive officers consists of the
following core principles:
- Base salary and benefits should be competitive in order to attract and
retain well-qualified executives.
- Incentive compensation should be directly related to achieving specified
levels of corporate financial performance. A significant part of the
executive officers' compensation should be at risk, based upon the success
of the Company.
- Long-term stock ownership of the Company's Common Stock by the Company's
executive officers creates a valuable link between the Company's
management and stockholders. Stock ownership gives management strong
incentives to properly balance the need for short-term profits with
long-term goals and objectives and to develop strategies that build and
sustain stockholder returns.
EXECUTIVE COMPENSATION PROGRAM
The Company's executive compensation program comprises five components which
are intended to reflect the Company's compensation philosophy.
BASE SALARY. Base salary and adjustments to base salary for the Company's
executive officers are targeted at the median of the competitive market. An
executive officer's base salary may be above or below the median, depending upon
the officer's individual performance. For the purpose of determining the median
of the competitive market, the Committee reviews and considers the salary ranges
of officers in comparable positions at companies of comparable size to the
Company. The peer group of companies used in the comparison consists of
approximately 120 companies that have annual sales ranging from $1 billion to $3
billion. The Committee believes that a broad base of companies of comparable
size more accurately reflects the market in which the Company competes for
executive talent than does the composition of companies in the Dow Jones Food
Index which has been used for the purpose of comparison in the Stock Performance
Graph in this Proxy Statement.
The Committee's practice has been to review the base salary of each
executive officer once every 15 to 18 months, at which time the executive
officer's base salary may be increased based upon the Committee's judgment of
the officer's individual performance and contribution to the Company, the
financial performance of the Company and the Company's established merit
increase guidelines.
ANNUAL BONUS. Under the Company's Management Incentive Plan, the executive
officers are eligible for an annual cash bonus, the amount of which may range
from 15% to 100% of annual base salary, depending upon the earnings per share
level achieved by the Company for the fiscal year. Threshold, target and maximum
7
<PAGE>
earnings per share objectives are established by the Committee at the beginning
of the fiscal year. No bonuses are paid if the Company does not achieve the
threshold earnings per share objective for the fiscal year. The target annual
bonus opportunity, represented as a percentage of base salary, for each
executive officer is set at the median of competitive practice. For this
purpose, the Committee reviews and considers bonus amounts awarded to officers
in comparable positions at companies of comparable size to the Company, as
described above. The threshold bonus opportunity for the Chief Executive Officer
is 20% of base salary and for the other executive officers is 15% of base
salary, and the target bonus opportunity for the Chief Executive Officer is 65%
of base salary and for the other executive officers is 50% of base salary.
With respect to each executive officer, 75% of the bonus opportunity is
based upon the achievement of the applicable earnings per share objective and
25% of the bonus opportunity may be awarded at the discretion of the Committee
based upon the officer's individual performance. With respect to the
discretionary portion of any bonus award, the Committee may award an amount up
to 125% of the discretionary bonus opportunity.
For fiscal year 1995, the Company's earnings per share slightly exceeded the
target earnings per share objective, after adjustment as described below, under
the Management Incentive Plan. The Committee adjusted the earnings per share
target for fiscal year 1995 to reflect the effect of the acquisition during the
year of the specialty foodservice distribution business of Leprino Foods Company
rather than the completion of other strategic objectives contemplated at the
beginning of the fiscal year in the Company's strategic plan for the year. The
Committee believed that the adjustment was appropriate in order to avoid
penalizing the management of the Company for pursuing corporate opportunities as
they arise. In addition, in calculating the earnings per share level achieved
for purposes of the Management Incentive Plan, the Committee did not take into
account the effect on the Company's earnings per share of unusual items during
the fiscal year, including the after-tax gain on the sale of the Company's
Frozen Specialty Foods business.
LONG-TERM COMPENSATION. Long-term compensation comprises stock options and
the Company's long-term incentive program. Both programs use shares of stock and
incentive units authorized by the Amended and Restated 1989 Stock-Based
Incentive Plan of the Company.
STOCK OPTIONS. During fiscal year 1995, the Committee did not grant any
stock options to the executive officers of the Company under the long-term
compensation program. The Committee decided to defer grants until after the
Board of Directors of the Company had an opportunity to review the strategic
direction of the Company at the beginning of the next fiscal year. The Committee
did not consider the number of options, shares of restricted stock and incentive
units outstanding or previously granted nor the aggregate size of current awards
in reaching its decision not to make additional awards. The stock options
currently held by the executive officers have an exercise price equal to the
market price of the Company's Common Stock on the date of grant and have
ten-year terms.
LONG-TERM INCENTIVE PROGRAM. Awards under the long-term incentive program
are made once every two years and, accordingly, no awards were granted under
such program during fiscal year 1995. During fiscal year 1994, the executive
officers were awarded shares of restricted stock with a ten-year vesting period
which will be accelerated only if the Company achieves specified financial
performance objectives over a three-year period ending on February 29, 1996. In
addition, each such officer received incentive units in a number equal to the
number of shares of restricted stock awarded to the officer which will be earned
and paid in the form of additional shares of restricted stock only if the
Company's financial performance exceeds the target level under the program. The
financial performance objectives were established by the Committee in March 1993
and are based on the growth rate in the Company's cumulative earnings per share
for the three-year period ending February 29, 1996 and the return on beginning
equity for the fiscal year ending February 29, 1996. The aggregate number of
shares of restricted stock and incentive units awarded to each executive officer
was set at the median of competitive practice, determined on the basis of
comparison with long-term incentive compensation programs (other than grants of
stock options), measured over a three-year period, for officers in comparable
positions at companies of comparable size to the Company.
WAIVER OF SALARY AND BONUS. The Committee believes that grants of stock
options and shares of restricted stock to executive officers in lieu of salary
and bonus link the interests of executives to the interests of the
8
<PAGE>
stockholders. The Committee makes such grants from time to time to executive
officers, and with respect to such waiver amounts, as it determines in its
discretion, and any grant may be accepted or rejected by an officer selected to
receive the grant. Options or shares of restricted stock granted have a fair
market value on the date of grant equal to the waiver amount. Mr. Luiso and the
other executive officers of the Company named in the Summary Compensation Table
below, other than Mr. Sampson, each waived specified amounts of salary and bonus
over a five-year period in exchange for options to purchase the Company's Common
Stock. Mr. Sampson is not a participant in the current waiver program relating
to the grant of stock options because he was not an executive officer at the
time the program was initiated. In addition, as described below, Mr. Luiso has
waived $450,000 of salary over a three-year period in exchange for shares of
restricted stock and in fiscal year 1995 waived $100,000 of cash bonus awarded
to him for fiscal year 1995 under the Company's Management Incentive Plan in
exchange for options to purchase the Company's Common Stock.
STOCK OWNERSHIP TARGETS. In 1992, the Committee established a stock
ownership program including stock ownership targets for key management employees
of the Company, including the Company's executive officers. Each participant in
the stock ownership program is expected to achieve the stock ownership target
established for him or her during an eight-year period beginning January 1,
1993. The target for each participant was based on a multiple of the
participant's annual base salary, ranging from one to five times the amount of
such salary, depending on the participant's level of responsibility within the
Company. The target is expressed as a number of shares determined by dividing
such multiple of annual base salary by the approximate market price of a share
of Common Stock of the Company at the time the stock ownership program was
adopted.
During calendar year 1993, participants in the stock ownership program as a
group achieved 156% of the aggregate annual stock ownership target. In
determining the number of shares of Common Stock acquired by the participants
during the year under the program, the Committee included shares purchased by
individual participants in the open market or upon the exercise of stock
options, shares of restricted stock that vested and were retained by the
participant during the year, shares of restricted stock that would have vested
during the year but with respect to which the participant elected to defer
vesting, and shares of restricted stock previously awarded relating to any
calendar year 1993 salary amount waived by the participant in connection with
such award. In March 1994, the Committee awarded to certain participants in the
stock ownership program shares of restricted stock which have a three-year
vesting period subject to the continued employment of the participant during
that period. The participants selected to receive awards and the number of
shares subject to each award were determined in the discretion of the Committee
and were based upon the Committee's assessment of the participant's job
performance and contributions to the Company and, more particularly, were based
upon the number of shares of the Company's Common Stock acquired by the
participant during calendar year 1993 toward the participant's annual stock
ownership target under the program. The number of shares of restricted stock
awarded to each participant was equal to approximately 15% of the number of
shares of Common Stock acquired by the participant during calendar year 1993 up
to a limit of 1.5 times the annual stock ownership target for the participant
for that year. The Committee believes that such awards of restricted stock will
encourage the Company's management to continue to obtain and hold a significant
number of shares of the Company's Common Stock.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
Mr. Luiso's performance is reviewed annually by the Committee and the full
Board of Directors of the Company. Mr. Luiso is eligible for a salary increase
once every 15 to 18 months, consistent with the policy relating to the other
executive officers of the Company. Any salary increase for Mr. Luiso is approved
by the Board of Directors of the Company following the recommendation of the
Committee. All other determinations regarding Mr. Luiso's compensation are made
by the Committee.
In accordance with the Committee's practice, Mr. Luiso's base salary was
reviewed in December 1994. At that time the Committee concluded that it would be
more appropriate to consider an adjustment to Mr. Luiso's base salary after the
Board of Directors of the Company had an opportunity to review with the
Company's management the strategic direction of the Company at the beginning of
the next fiscal year.
9
<PAGE>
Mr. Luiso has waived $450,000 of base salary over a three-year period, which
commenced on January 1, 1993, in exchange for an aggregate of 16,035 shares of
restricted Common Stock of the Company. The shares were valued at $28.06 per
share, which was the fair market value of a share of Common Stock on the date
the shares were granted. Accordingly, during the last fiscal year, Mr. Luiso's
base salary of $530,000 was reduced by $150,000. The shares vest on the basis of
Mr. Luiso's continued employment with the Company. In fiscal year 1995, Mr.
Luiso elected to defer the vesting of the shares of restricted stock from
January 1, 1996 to January 1, 1997.
In fiscal year 1995, Mr. Luiso agreed to waive $100,000 of any cash bonus
awarded to him under the Company's Management Incentive Plan for fiscal year
1995 in exchange for options to purchase 20,513 shares of Common Stock of the
Company. The number of options granted to Mr. Luiso was based upon an option
value at March 31, 1994, the date of grant of the option, of $4.875 per option,
which was the median of the option value range determined by an independent
evaluation firm. Each option has an exercise price of $16.875, which was the
fair market value of one share of the Company's Common Stock on the date the
options were granted.
For fiscal year 1995, Mr. Luiso received a bonus of $365,170, or 69% of his
base salary, (before the $100,000 amount waived in connection with the grant of
stock options as described above), determined in accordance with the Company's
Management Incentive Plan described above. The amount comprises $273,878
relating to 75% of the bonus opportunity based upon the earnings per share level
achieved and $91,292, which reflects 100% of the remainder of the bonus
opportunity awarded in the Committee's discretion based upon Mr. Luiso's
individual performance. The factors the Committee considered (without assigning
any priority among the factors) in awarding the discretionary portion of the
bonus to Mr. Luiso were the Company's continued implementation of its long-term
business strategy, the acquisition of the specialty foodservice distribution
business of Leprino Foods Company and the integration of such business with the
Company's business, and the appointment of new management in certain of the
Company's business divisions.
In fiscal year 1995, Mr. Luiso received 2,250 shares of restricted stock in
connection with the Company's management stock ownership program. The number of
shares of restricted stock awarded to Mr. Luiso was determined as described
above under the heading, "Stock Ownership Targets."
TAX DEDUCTIBILITY OF EXECUTIVE COMPENSATION
In the event that compensation paid by the Company to any executive officer
of the Company during the current or any subsequent fiscal year exceeds
$1,000,000, such excess amount may not qualify as a tax deduction for the
Company under the provisions of Section 162(m) of the Internal Revenue Code of
1986, as amended. The Committee believes that in the near term the Section
162(m) limitation is not likely to have an effect on the Company because the
annual compensation of any executive officer is not expected to exceed
$1,000,000 and, therefore, the Company presently is not amending its
compensation plans or programs to meet the requirements of Section 162(m). In
addition, in the near term, Section 162(m) and proposed regulations thereunder
exclude from the $1,000,000 limitation any income realized by an executive
officer of the Company upon the exercise of outstanding stock options or options
which may be granted under existing stock option plans of the Company. The
Committee, along with the Company, will evaluate the Company's compensation
plans and programs on an ongoing basis in view of the Section 162(m) limitation.
William A. Andres, Chairman
James G. Fifield
Robert M. Price
Nicholas L. Reding
Members of the Compensation Committee
10
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth the cash compensation and certain other
components of the compensation of the Chief Executive Officer of the Company and
the four other most highly compensated executive officers of the Company for
each of the Company's last three fiscal years.
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
--------------------------------------
AWARDS
ANNUAL COMPENSATION ---------------------------- PAYOUTS
-------------------------------------- RESTRICTED SECURITIES ------- ALL OTHER
OTHER ANNUAL STOCK UNDERLYING LTIP COMPEN-
NAME AND PRINCIPAL POSITION YEAR SALARY(2) BONUS(2)(5) COMPENSATION AWARDS(7) OPTIONS(#) PAYOUTS SATION(13)
- ---------------------------- ---- --------- ----------- ------------ --------- ---------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Anthony Luiso .............. 1995 $380,000(3) $265,170 $0 $41,063(8) 20,513(12) $0 $4,620
Chairman, President and 1994 $380,000(3) $0 $0 $643,750(9) 0 $0 $4,205
Chief Executive Officer 1993 $413,333(4) $355,800 $54,084(6) $623,812(10)(11) 25,000 $0 $4,656
Duncan H. Cocroft .......... 1995 $231,250 $73,550 $0 $12,319(8) 0 $0 $4,620
Vice President--Finance 1994 $225,000 $0 $0 $257,500(9) 0 $0 $4,205
and 1993 $214,500 $115,040 $0 $86,907(11) 6,500 $0 $4,364
Chief Financial Officer
Jay I. Johnson ............. 1995 $227,500 $58,625 $0 $12,228(8) 0 $0 $4,620
Group Vice President 1994 $227,500 $0 $0 $206,000(9) 0 $0 $3,792
1993 $225,417 $107,538 $0 $92,700(11) 6,500 $0 $3,792
John E. Sampson(1) ......... 1995 $212,500 $117,450 $0 $9,125(8) 0 $0 $4,870
Vice-President--Corporate 1994
Planning and Development 1993
Robert F. Maddocks ......... 1995 $173,333 $44,840 $0 $7,756(8) 0 $0 $4,620
Vice President--Human 1994 $170,167 $0 $0 $193,125(9) 0 $0 $4,428
Resources 1993 $161,000 $86,520 $0 $63,731(11) 6,500 $0 $4,364
<FN>
- ----------
(1) Mr. Sampson became an executive officer of the Company in fiscal year 1995.
(2) The salary and bonus amounts for Mr. Luiso in fiscal year 1993 exclude
portions of the cash compensation waived over three-year and five-year
periods, respectively, in exchange for stock options which were granted to
Mr. Luiso in fiscal year 1990. At the end of fiscal year 1994, no waiver
periods remained with respect to such option grant. The bonus amount for
Mr. Luiso in fiscal year 1995 excludes cash compensation waived in exchange
for stock options which were granted to Mr. Luiso in fiscal year 1995. The
salary and bonus amounts for Mr. Cocroft, Mr. Johnson and Dr. Maddocks
exclude portions of the cash compensation waived over a five-year period in
exchange for stock options which were granted in fiscal year 1991. The
amounts of salary and bonus waived for each of the fiscal years shown are
as follows:
Mr. Cocroft, Mr. Johnson and Dr.
Mr. Luiso: Maddocks:
SALARY BONUS SALARY BONUS
------- -------- ------- -------
1995........... $ 0 $100,000 1995........... $35,000 $70,000*
1994........... $ 0 $ 0* 1994........... $35,000 $ 0*
1993........... $91,667 $100,000 1993........... $35,000 $35,000
* Because Mr. Luiso did not receive a cash bonus for fiscal year 1994, he
forfeited options to purchase 22,988 shares of Common Stock relating to
the fiscal year 1990 option grant referred to above. Under the terms of
the options held by Mr. Cocroft, Mr. Johnson and Dr. Maddocks, the
options that related to the fiscal year 1994 bonus period were carried
forward and vested in fiscal year 1995 along with the options held by
such officers relating to the fiscal year 1995 bonus period. No bonus
waiver periods remain with respect to such options.
(3) The salary amount excludes $150,000 of the $450,000 of cash compensation
that Mr. Luiso has waived over a three-year period, which commenced
January 1, 1993, in exchange for 16,035 shares of restricted stock which
were granted to Mr. Luiso in fiscal year 1993.
</TABLE>
11
<PAGE>
<TABLE>
<S> <C>
(4) The salary amount also excludes $25,000 of the $450,000 of cash
compensation waived over a three-year period as described above in note
3.
(5) The amounts were paid pursuant to the Company's Management Incentive Plan
described above in the Compensation Committee Report on Executive
Compensation.
(6) The amount includes financial planning services valued at $28,745.
(7) The value of each restricted stock award was determined by multiplying
the closing market price of the Company's Common Stock on the date of
grant by the number of shares awarded. As of February 28, 1995, the
number and value (based on the closing market price of the Company's
Common Stock on February 28, 1995) of the aggregate restricted stock
holdings of each of the named executive officers were as follows: 72,535
shares ($1,350,964) by Mr. Luiso, 10,675 shares ($198,822) by Mr.
Cocroft, 8,670 shares ($161,479) by Mr. Johnson, 3,000 shares ($55,875)
by Mr. Sampson and 7,925 shares ($147,603) by Dr. Maddocks.
(8) The shares of restricted stock were awarded by the Compensation Committee
to each executive officer in recognition of his achievement of progress
toward his individual stock ownership target under the management stock
ownership program, as described above in the Compensation Committee
Report on Executive Compensation. The number of shares awarded were as
follows: 2,250 shares to Mr. Luiso, 675 shares to Mr. Cocroft, 670 shares
to Mr. Johnson, 500 shares to Mr. Sampson and 425 shares to Dr. Maddocks.
The shares vest on March 18, 1997, subject to the continued employment of
the executive officer. The shares also vest in the event of a change in
control of the Company. Dividends are paid on the shares of restricted
stock at the same rate as paid to all stockholders, but the executive
officer is not entitled to receive such dividends unless and until the
related shares vest.
(9) The shares of restricted stock were awarded under the Company's long-term
incentive program relating to a three-year performance cycle ending on
February 29, 1996, as described above in the Compensation Committee
Report on Executive Compensation. The numbers of shares awarded were as
follows: 25,000 shares to Mr. Luiso, 10,000 shares to Mr. Cocroft, 8,000
shares to Mr. Johnson and 7,500 shares to Dr. Maddocks. Although the full
value of the shares awarded to the executive officer is shown for fiscal
year 1994, no payout will be made under the program until the end of the
three-year performance cycle, and then only if established corporate
financial performance objectives are achieved. If no payout is made at
the end of the three-year cycle, the shares will vest ten years from the
date of grant, provided that the executive officer remains employed by
the Company until such date. If a payout is made at the end of the
three-year performance period with respect to all or any portion of the
shares of restricted stock awarded, 20% of such shares will vest at that
time, 30% of such shares will vest on February 28, 1997 and 50% of such
shares will vest on February 28, 1998, subject to the continued
employment of the executive officer on the respective dates. The shares
also vest in the event of a change in control of the Company. Dividends
are paid on the shares of restricted stock at the same rate as paid to
all stockholders, but the executive officer is not entitled to receive
such dividends unless and until the related shares vest. Incentive units
were awarded in tandem with the shares of restricted stock in a number
equal to the number of shares of restricted stock awarded to each
executive officer. The incentive units will be paid out only if corporate
financial performance exceeds the target level.
(10) The amount shown includes the 16,035 shares of restricted stock granted
to Mr. Luiso in connection with his waiver of $450,000 of salary over a
three-year period as described above in note 3. Dividends are paid on the
shares of restricted stock at the same rate as paid to all stockholders,
but Mr. Luiso is not entitled to receive such dividends unless and until
the shares vest.
(11) Shares of restricted stock were awarded under the Company's long-term
incentive program with respect to the three-year performance period ended
February 28, 1993 as the form of payout of 30% of the incentive units
previously awarded in tandem with shares of restricted stock under such
program. The Company's long-term incentive program is described above in
the Compensation Committee Report on Executive Compensation. The numbers
of shares awarded were as follows: 6,750 shares to Mr. Luiso,
</TABLE>
12
<PAGE>
<TABLE>
<S> <C>
3,375 shares to Mr. Cocroft, 3,600 shares to Mr. Johnson and 2,475 shares
to Dr. Maddocks. Except for shares held by Mr. Luiso who elected to defer
the vesting of his shares, the shares vested over a three-year period
ended February 28, 1995. Dividends were paid on the shares of restricted
stock at the same rate as paid to all stockholders.
(12) The options were granted to Mr. Luiso in connection with his waiver of
$100,000 of any cash bonus awarded to him for fiscal year 1995 as
described above in note 2.
(13) The amounts reported represent the Company's matching contributions to
the Company's Savings Plan.
</TABLE>
STOCK OPTIONS
The following tables summarize stock option grants to and exercises by the
executive officers named in the Summary Compensation Table above during the
Company's fiscal year 1995 and the value of stock options held by such officers
at the end of fiscal year 1995.
OPTION GRANTS IN FISCAL YEAR 1995
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE
AT
INDIVIDUAL GRANTS ASSUMED ANNUAL
-------------------------------------------------------- RATES OF
NUMBER OF % OF TOTAL STOCK PRICE
SECURITIES OPTIONS APPRECIATION
UNDERLYING GRANTED TO EXERCISE FOR OPTION TERM
OPTIONS EMPLOYEES IN OR BASE EXPIRATION ------------------
NAME GRANTED(1) FISCAL YEAR PRICE ($/SHARE) DATE 5% 10%
- ------------------------- ---------- ------------ --------------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Anthony Luiso............ 20,513 50.38% $16.875 3/30/04 $217,695 $551,685
<FN>
- ----------
(1) The options were granted on March 31, 1994 in connection with Mr. Luiso's
waiver of $100,000 of any cash bonus awarded to him for fiscal year 1995.
The options became exercisable upon the grant to Mr. Luiso of his bonus
award for fiscal year 1995. The options contain a feature which permits the
withholding of shares issuable upon exercise to satisfy income tax
withholding requirements.
</TABLE>
AGGREGATED OPTION EXERCISES IN FISCAL YEAR 1995 AND FISCAL YEAR END OPTION
VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
SHARES FISCAL YEAR END FISCAL YEAR END
ACQUIRED ON VALUE (EXERCISABLE/ (EXERCISABLE/
NAME EXERCISE REALIZED UNEXERCISABLE) UNEXERCISABLE)(1)
- ------------------------- ------------ -------- --------------- --------------------
<S> <C> <C> <C> <C>
Anthony Luiso............ 0 $0 301,245/43,501 $0/$35,898
Duncan H. Cocroft........ 0 $0 104,602/25,852 $0/$0
Jay I. Johnson........... 0 $0 103,602/25,852 $0/$0
John E. Sampson.......... 0 $0 42,750/0 $0/$0
Robert F. Maddocks....... 0 $0 91,352/25,852 $0/$0
<FN>
- ----------
(1) The value was determined by subtracting the exercise price per share from
the closing market price per share of the Company's Common Stock on
February 28, 1995.
</TABLE>
EMPLOYEES' RETIREMENT PLAN AND MANAGEMENT BENEFIT PLAN
The Company maintains the Employees' Retirement Plan (the "Retirement Plan")
for full-time salaried employees of the Company and certain other employees of
the Company and its subsidiaries who have completed one year of service with the
Company or a subsidiary of the Company. The Retirement Plan is a tax qualified
defined benefit pension plan which provides for monthly benefits for life to
employees upon retirement and certain disability and death benefits. A salaried
employee's retirement benefits are based on the employee's years of service with
the Company or a subsidiary of the Company and the employee's "Final
13
<PAGE>
Average Salary" and "Covered Compensation." Final Average Salary is the average
of the employee's base salary for the three consecutive calendar years in which
the employee's base salary was the highest during the last ten full calendar
years prior to retirement. Base salary does not include bonuses and other
additional compensation. In addition, the amount of base salary covered by the
Retirement Plan is limited by requirements of the Internal Revenue Code of 1986,
as amended (the "Internal Revenue Code") and the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"). Covered Compensation is the average
of the Social Security taxable wage bases in effect for the 35-year period
ending with the year in which the employee reaches normal retirement age for
Social Security purposes that is used by the Social Security Administration in
determining an individual's primary Social Security benefit at retirement. Under
the Retirement Plan, an employee's accrued annual benefit is equal to 30% of the
employee's Final Average Salary up to the amount of Covered Compensation plus
45% of the excess of Final Average Salary over the amount of Covered
Compensation. The level of annual benefits is reduced if the employee retires
prior to age 62. An employee becomes vested in his or her benefits under the
Retirement Plan after five years of service.
The Company's Management Benefit Plan provides for the payment of additional
amounts to certain key employees of the Company and its subsidiaries (including
the executive officers named in the Summary Compensation Table) so that they
will receive in the aggregate the benefits they would have been entitled to
receive under the Retirement Plan without the limitations imposed by the
Internal Revenue Code or ERISA. Participants in the Management Benefit Plan are
also entitled to lifetime annual income upon retirement equal to 50% of the
"Bonus Base." For employees who became participants in the Management Benefit
Plan prior to March 1, 1990, the Bonus Base is the average of the five highest
bonuses awarded to the participant under the Management Incentive Plan during
the last ten years of employment by the Company prior to retirement. For
employees who became participants in the Management Benefit Plan on or after
March 1, 1990, the Bonus Base includes such bonuses awarded only while the
employee is a participant in the Management Benefit Plan unless the Compensation
Committee prescribes otherwise. The level of annual benefits is reduced if the
employee retires prior to age 62. A participant in the Management Benefit Plan
becomes vested in his or her benefits under the Management Benefit Plan upon
completion of ten years of service with the Company or when age plus years of
service equal 60.
The following table shows the estimated combined annual amounts payable with
respect to various classifications of earnings and years of service to
participants in both the Retirement Plan and Management Benefit Plan who retire
at the normal retirement age of 65 and elect payment of a straight life annuity.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
--------------------------------------------------------------------
REMUNERATION* 5 YEARS 10 YEARS 15 YEARS 20 YEARS 25 YEARS 30 YEARS 35 YEARS
- ------------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 200,000 $ 42,836 $ 50,672 $ 58,509 $ 66,345 $ 74,181 $ 82,017 $ 89,853
$ 400,000 $ 86,193 $102,387 $118,580 $134,773 $150,967 $167,160 $183,353
$ 600,000 $129,550 $154,101 $178,651 $203,202 $227,752 $252,303 $276,853
$ 800,000 $172,908 $205,815 $238,723 $271,630 $304,538 $337,446 $370,353
$1,000,000 $216,265 $257,529 $298,794 $340,059 $381,324 $422,588 $463,853
$1,200,000 $259,622 $309,244 $358,866 $408,488 $458,109 $507,731 $557,353
<FN>
- ----------
*For purposes of this table, it is assumed that remuneration is comprised 65% of
Final Average Salary and 35% of Bonus Base (both terms as defined above). The
benefits are not subject to any reduction for Social Security or other offset
amounts.
</TABLE>
Messrs. Luiso, Cocroft, Johnson, Sampson and Maddocks have 8, 5, 6, 10 and 5
years of service, respectively, under the Retirement Plan. Except for Mr.
Cocroft, each of the executive officers named in the Summary Compensation Table
is fully vested in the Management Benefit Plan, including Mr. Luiso, who was
given nine years of deemed service pursuant to his Employment Agreement with the
Company.
14
<PAGE>
EMPLOYMENT AGREEMENT
Pursuant to an Employment Agreement between the Company and Mr. Luiso, the
Company has agreed to employ Mr. Luiso as Chairman of the Board, President and
Chief Executive Officer for a period of three years (subject to automatic annual
extensions of the three-year period unless the Company notifies Mr. Luiso of its
decision not to extend the term) at a current minimum annual base salary of
$530,000 per year, exclusive of any annual bonus or other incentive
compensation, employee benefits and perquisites. In addition, the Employment
Agreement provides for a supplemental retirement benefit to be paid to Mr. Luiso
(in addition to any other benefits under retirement plans of the Company) based
upon the benefits Mr. Luiso would have received had he been employed by the
Company for an additional fifteen years. The additional years of service will
accrue to Mr. Luiso over a period of twelve years in the event Mr. Luiso
continues to be employed by the Company for twelve years. If Mr. Luiso had
retired on February 28, 1995, the annual supplemental retirement benefit payable
to Mr. Luiso upon attaining age 55 would have been $57,546. In the event of a
change in control of the Company, Mr. Luiso is entitled to a lump sum payment of
his supplemental retirement benefit, which would have been approximately
$508,838 if a change in control had occurred on February 28, 1995. Under the
Employment Agreement, Mr. Luiso was also given nine years of deemed service
under the Management Benefit Plan of the Company. If, during the term of the
Employment Agreement, the Company terminates Mr. Luiso's employment for any
reason other than cause, death or disability, or Mr. Luiso terminates his
employment for "good reason" (as defined in the Employment Agreement), the
Company is obligated to pay to Mr. Luiso, in a lump sum, the aggregate of (i)
the amounts of any accrued or deferred compensation plus the amount of his
maximum bonus opportunity for the then current fiscal year under the Company's
Management Incentive Plan to the extent such amount has not been paid and (ii)
if such termination follows a change in control of the Company (as defined in
the Employment Agreement), an amount equal to 2.5 times the total of Mr. Luiso's
annual base salary in effect at the time of the change in control plus the
average of the bonus awards paid to Mr. Luiso under the Company's Management
Incentive Plan for the three fiscal years immediately preceding the change in
control, subject to increase in the event the payment or any other payments made
in connection with a change in control constitute "parachute payments" under the
Internal Revenue Code. Assuming a change in control of the Company had occurred
and Mr. Luiso's employment was terminated by the Company or Mr. Luiso terminated
his employment for "good reason" on February 28, 1995, the amount payable to Mr.
Luiso would have been approximately $3,173,758.
SEVERANCE AGREEMENTS AND CHANGE IN CONTROL ARRANGEMENTS
The Company is a party to severance agreements with Messrs. Cocroft,
Johnson, Sampson and Maddocks. The two-year term of each agreement is
automatically extended each year for one additional year unless the Company
gives notice to the officer that the Company does not wish to extend the
agreement. No such notice has been given to any executive officer. Under each
agreement, the Company has agreed to employ the executive officer for a period
of two years following a change in control of the Company (as defined in the
agreement). If, during such two-year period, the officer's employment is
terminated by the Company for any reason other than cause, death or disability,
or the officer terminates his employment for "good reason" (as defined in the
agreement), the Company is obligated to pay to such officer, in a lump sum, the
aggregate of (i) the amounts of any accrued or deferred compensation and (ii) an
amount equal to 2.5 times the total of the officer's annual base salary in
effect at the time of the change in control plus the average of the bonus awards
paid to the officer under the Company's Management Incentive Plan for the three
fiscal years immediately preceding the change in control, subject to increase in
the event the payment or any other payments made in connection with a change in
control constitute "parachute payments" under the Internal Revenue Code.
Assuming a change in control of the Company had occurred and each of the
officers' employment was terminated by the Company or each officer terminated
his employment for "good reason" on February 28, 1995, the amounts payable to
Messrs. Cocroft, Johnson, Sampson and Maddocks under the agreements would have
been approximately $1,281,342, $1,212,269, $946,922 and $997,848, respectively.
Mr. Sampson also has a severance agreement with the Company whereby the
Company has agreed to pay Mr. Sampson one year's salary in the event Mr.
Sampson's employment is terminated either by the Company or Mr. Sampson at any
time prior to August 1, 1996, subject to a three-month notification period on
the part of Mr. Sampson.
15
<PAGE>
The Company has certain other compensatory arrangements with its executive
officers which will result from a change in control of the Company. The
Management Incentive Plan provides that in the event of a change in control of
the Company during the first six months of the Company's fiscal year, each
participant in the Management Incentive Plan will receive an immediate cash
payment equal to 100% of the target annual bonus amount for that fiscal year as
if the target performance objective had been met. In the event of a change in
control during the last six months of the Company's fiscal year, each
participant will receive an immediate cash payment equal to 100% of the greater
of (i) the target annual bonus amount for that fiscal year as if the target
performance objective had been met or (ii) the amount determined based upon the
anticipated results relating to the performance objective for that fiscal year.
With respect to the stock options granted to Messrs. Cocroft, Johnson and
Maddocks in connection with the waiver of salary over a five-year period, each
such officer may, in the event of a change in control of the Company, make a
cash payment to the Company equal to the remainder of the salary reductions over
such period and receive that number of vested options that would have become
vested during the remainder of the five-year period. Stock options granted in
connection with the waiver of bonus amounts have vested in full. All other stock
options outstanding under the Company's stock-based incentive plans which are
not yet exercisable become immediately exercisable in the event of a change in
control of the Company. In addition, all shares of restricted stock outstanding
vest in full and all incentive units outstanding vest on a pro rata basis in the
event of a change in control of the Company.
The Management Benefit Plan provides for lump sum payments to the
participants in the event of a change in control of the Company plus an
additional amount in the event the payment constitutes a "parachute payment"
under the Internal Revenue Code. In addition, the Board of Directors authorized
the establishment and funding of a trust for the purpose of assisting the
Company in fulfilling its obligations to the participants in the Management
Benefit Plan, which trust will become irrevocable upon the earlier of (i) a
change in control of the Company or (ii) a favorable ruling from the Internal
Revenue Service that the creation and funding of the trust does not result in
constructive receipt to the participants, neither of which event has yet
occurred. Assuming a change in control of the Company had occurred on February
28, 1995, the lump sums payable to Messrs. Luiso, Cocroft, Johnson, Sampson and
Maddocks would have been approximately $1,550,424, $157,168, $668,540, $496,610,
and $462,834, respectively.
16
<PAGE>
STOCK PERFORMANCE GRAPH
The following graph compares the cumulative total return on the Common Stock
of the Company for the last five fiscal years with the cumulative total return
of the Standard & Poor's 500 Composite Stock Index (the "S&P 500") and the Dow
Jones Food Index for the same period (assuming the investment of $100 in the
Company's Common Stock, the S&P 500 and the Dow Jones Food Index on February 28,
1990 and reinvestment of all dividends). The cumulative returns are as of
February 28 or February 29 of each year, as the case may be, the Company's
fiscal year end.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
MULTIFOODS S&P 500 DOW JONES FOOD INDEX
<S> <C> <C> <C>
1990 100 100 100
1991 162 115 133
1992 171 133 161
1993 172 147 174
1994 120 159 159
1995 135 171 183
</TABLE>
17
<PAGE>
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who beneficially own more than ten percent
of the Company's Common Stock, to file reports of ownership and changes in
ownership of the Company's Common Stock and other equity securities with the
Securities and Exchange Commission and the New York Stock Exchange. Such
officers, directors and greater than ten-percent beneficial owners are required
by regulation of the Securities and Exchange Commission to furnish the Company
with copies of all Section 16(a) reports they file.
To the Company's knowledge, based solely on the Company's review of copies
of such reports furnished to the Company and written representations from
certain reporting persons that no other reports were required for those persons,
the Company believes that, during the fiscal year ended February 28, 1995, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than ten-percent beneficial owners were met.
APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors of the Company has appointed KPMG Peat Marwick LLP,
certified public accountants, as the Company's independent auditors for the
fiscal year ending February 29, 1996, subject to stockholder approval. KPMG Peat
Marwick LLP has audited the books of the Company for many years. The action of
the Board of Directors was taken upon the recommendation of the Audit Committee
of the Board of Directors.
Representatives of KPMG Peat Marwick LLP will be present at the Annual
Meeting and will have the opportunity to make a statement if they desire to do
so and to respond to appropriate questions from stockholders.
The Board of Directors recommends a vote FOR the approval of the appointment
of KPMG Peat Marwick LLP.
STOCKHOLDER PROPOSALS FOR THE 1996 ANNUAL MEETING
Any stockholder proposal intended to be presented for consideration at the
1996 Annual Meeting of Stockholders and to be included in the Company's proxy
statement must be received at the principal executive offices of the Company by
the close of business on January 16, 1996. Proposals should be sent to the
attention of the Secretary.
OTHER MATTERS
The Company is not aware of any other matters which may come before the
Annual Meeting. If other matters are properly presented at the Annual Meeting,
it is the intention of the persons named as proxies in the enclosed proxy to
vote in accordance with their judgment as to the best interests of the Company.
By Order of the Board of Directors
FRANK W. BONVINO
SECRETARY
May 15, 1995
18
<PAGE>
[RECYCLED LOGO]
PRINTED ON RECYCLED
PAPER CONTAINING AT
LEAST 10% FIBERS FROM
PAPER RECYCLED BY
CONSUMERS.
<PAGE>
PROXY INTERNATIONAL MULTIFOODS CORPORATION
1995 ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY
The undersigned hereby appoints Anthony Luiso, William A. Andres and Peter
S. Willmott, and each of them, with power to appoint a substitute, to vote, in
accordance with the specifications appearing below, all shares the undersigned
is entitled to vote at the Annual Meeting of Stockholders of International
Multifoods Corporation, a Delaware corporation, to be held on Friday, June 16,
1995, at 10:00 a.m. local time, and at all adjournments thereof, and, in their
discretion, upon all other matters that may properly come before the Annual
Meeting or any adjournment or adjournments thereof, and hereby revokes all
former proxies. The undersigned hereby acknowledges receipt of the Proxy
Statement for the Annual Meeting.
1. ELECTION OF DIRECTORS. NOMINEES: Anthony Luiso, Lois D. Rice and Peter S.
Willmott
<TABLE>
<S> <C>
/ / VOTE FOR all nominees listed above, / / WITHHOLD AUTHORITY
except those whose names are written below: to vote for all nominees listed
above
</TABLE>
- --------------------------------------------------------------------------------
2. PROPOSAL TO APPROVE THE APPOINTMENT OF KPMG PEAT MARWICK LLP AS INDEPENDENT
AUDITORS OF THE COMPANY.
/ / FOR / / AGAINST / / ABSTAIN
(CONTINUED, AND TO BE SIGNED AND DATED, ON OTHER SIDE)
<PAGE>
3. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
MATTERS THAT MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENT
OR ADJOURNMENTS THEREOF.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED. IF NO DIRECTION
IS GIVEN, THIS PROXY SHALL BE VOTED FOR THE ELECTION OF DIRECTORS AND FOR
PROPOSAL 2.
Dated: -------------------------, 1995
-------------------------------------
Signature
---------------------------------------
(If there are co-owners both must sign)
THE SIGNATURE(S) SHOULD BE EXACTLY AS
THE NAME(S) APPEAR PRINTED TO THE LEFT.
IF A CORPORATION, PLEASE SIGN THE
CORPORATION NAME IN FULL BY A DULY
AUTHORIZED OFFICER AND INDICATE THE
OFFICE OF THE SIGNER. WHEN SIGNING AS
EXECUTOR, ADMINISTRATOR, FIDUCIARY,
ATTORNEY, TRUSTEE OR GUARDIAN, OR AS
CUSTODIAN FOR A MINOR, PLEASE GIVE FULL
TITLE AS SUCH. IF A PARTNERSHIP, SIGN
IN THE PARTNERSHIP NAME.
PLEASE MARK, SIGN, DATE AND RETURN THE
PROXY
CARD PROMPTLY USING THE ENCLOSED
ENVELOPE
<PAGE>
CONFIDENTIAL VOTING INSTRUCTIONS TO NORWEST BANK
MINNESOTA, N.A., AS TRUSTEE UNDER THE EMPLOYEES' VOLUNTARY
INVESTMENT AND SAVINGS PLAN OF INTERNATIONAL MULTIFOODS CORPORATION
I hereby direct that the voting rights pertaining to shares of Common Stock
of INTERNATIONAL MULTIFOODS CORPORATION, a Delaware corporation, held by the
Trustee and allocated to my Member Account shall be exercised at the Annual
Meeting of Stockholders of INTERNATIONAL MULTIFOODS CORPORATION, to be held at
Minneapolis, Minnesota on June 16, 1995, and at all adjournments thereof, upon
the matters set forth below and upon such other business as may properly come
before the Annual Meeting, all as set forth in the Proxy Statement. The
undersigned hereby acknowledges receipt of the Proxy Statement for the Annual
Meeting.
1. ELECTION OF DIRECTORS. NOMINEES: Anthony Luiso, Lois D. Rice and Peter S.
Willmott
<TABLE>
<S> <C>
/ / VOTE FOR all nominees listed above, / / WITHHOLD AUTHORITY
except those whose names are written below: to vote for all nominees listed
above
</TABLE>
- --------------------------------------------------------------------------------
2. PROPOSAL TO APPROVE THE APPOINTMENT OF KPMG PEAT MARWICK LLP AS INDEPENDENT
AUDITORS OF THE COMPANY.
/ / FOR / / AGAINST / / ABSTAIN
(CONTINUED, AND TO BE SIGNED AND DATED, ON OTHER SIDE)
<PAGE>
THIS CARD IS FURNISHED IN CONNECTION WITH THE SOLICITATION OF PROXIES BY THE
BOARD OF DIRECTORS OF THE COMPANY. THE VOTING RIGHTS REPRESENTED HEREBY WILL BE
EXERCISED AS DIRECTED BY YOU. AS TO MATTERS COMING BEFORE THE MEETING FOR WHICH
NO VOTING INSTRUCTIONS ARE RECEIVED BY THE TRUSTEE PRIOR TO THE MEETING, THE
TRUSTEE WILL EXERCISE VOTING RIGHTS IN PROPORTION TO THE VOTING INSTRUCTIONS
ACTUALLY RECEIVED BY THE TRUSTEE PRIOR TO THE MEETING.
Dated: -------------------------, 1995
-------------------------------------
Signature
(PLEASE DATE AND SIGN EXACTLY AS YOUR
NAME APPEARS HEREON.)
PLEASE MARK, SIGN, DATE AND RETURN
THIS CARD
PROMPTLY USING THE ENCLOSED ENVELOPE
<PAGE>
CONFIDENTIAL VOTING INSTRUCTIONS TO THE CANADA TRUST COMPANY
AS TRUSTEE UNDER THE STOCK PURCHASE PLAN OF
ROBIN HOOD MULTIFOODS INC.
I hereby direct that the voting rights pertaining to shares of Common Stock
of INTERNATIONAL MULTIFOODS CORPORATION, a Delaware corporation, held by the
Trustee and allocated to my Member Account shall be exercised at the Annual
Meeting of Stockholders of INTERNATIONAL MULTIFOODS CORPORATION, to be held at
Minneapolis, Minnesota on June 16, 1995, and at all adjournments thereof, upon
the matters set forth below and upon such other business as may properly come
before the Annual Meeting, all as set forth in the Proxy Statement. The
undersigned hereby acknowledges receipt of the Proxy Statement for the Annual
Meeting.
1. ELECTION OF DIRECTORS. NOMINEES: Anthony Luiso, Lois D. Rice and Peter S.
Willmott
<TABLE>
<S> <C>
/ / VOTE FOR all nominees listed above, / / WITHHOLD AUTHORITY
except those whose names are written below: to vote for all nominees listed
above
</TABLE>
- --------------------------------------------------------------------------------
2. PROPOSAL TO APPROVE THE APPOINTMENT OF KPMG PEAT MARWICK LLP AS INDEPENDENT
AUDITORS OF THE COMPANY.
/ / FOR / / AGAINST / / ABSTAIN
(CONTINUED, AND TO BE SIGNED AND DATED, ON OTHER SIDE)
<PAGE>
THIS CARD IS FURNISHED IN CONNECTION WITH THE SOLICITATION OF PROXIES BY THE
BOARD OF DIRECTORS OF THE COMPANY. THE VOTING RIGHTS REPRESENTED HEREBY WILL BE
EXERCISED AS DIRECTED BY YOU. AS TO MATTERS COMING BEFORE THE MEETING FOR WHICH
NO VOTING INSTRUCTIONS ARE RECEIVED BY THE TRUSTEE PRIOR TO THE MEETING, THE
TRUSTEE MAY EXERCISE VOTING RIGHTS IN SUCH MANNER AS THE TRUSTEE MAY, IN ITS
DISCRETION, DETERMINE.
Dated: -------------------------, 1995
-------------------------------------
Signature
(PLEASE DATE AND SIGN EXACTLY AS YOUR
NAME APPEARS HEREON.)
PLEASE MARK, SIGN, DATE AND RETURN
THIS CARD
PROMPTLY USING THE ENCLOSED ENVELOPE
