<PAGE>
PRELIMINARY PROXY MATERIAL
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 10549
SCHEDULE 14A
(Rule 14a-6(i)(3)
Pursuant to Section 14(a) of the Securities Exchange Act of 1934
OPPOSITION GROUP'S PROXY STATEMENT
PROXY STATEMENT 2 - (A) RESIGNATION OR REMOVAL OF DIRECTORS AND (B) ELECTION OF
NEW DIRECTORS
THE OPPOSITION GROUP ASKS YOU TO VOTE ON THREE MATTERS:
AGAINST THE MERGER; FOR THE RESIGNATION OR REMOVAL OF DIRECTORS; AND, FOR
ELECTION OF NEW DIRECTORS
FILED BY A PARTY OTHER THAN THE REGISTRANT
SUMMIT FAMILY RESTAURANTS, INC.
-------------------------------
(Name of Registrant as Specified in Its Charter)
First Global Securities, Inc., on behalf of the Opposition Proxy Group,
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including, itself, Susan W. Trenham, Kennedy Capital Management, Inc.,
----------------------------------------------------------------------
William H. Burgess, J. D. Campa and Associates, Inc., Michael E. Portnoy,
-------------------------------------------------------------------------
Howard Foster Company, Mark R. Tonucci, T.H. Fitzgerald, Peter Sorokin,
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Mark A. Fries, and Gary B. Davidson and Harold Fox
--------------------------------------------------
(Names of Persons or Entities Filing Proxy Statement, if other than the
Registrant)
Contact:
Susan W. Trenham
Co-Chair and CEO
First Global Securities, Inc.
790 East Colorado Blvd., #500
Pasadena, Ca. 91101
(818) 568-8800
Payment of Filing Fee: $500 pursuant to Exchange Act Rule 14a-6(i)(3).
Fees previously paid: $1,000 pursuant to Exchange Act Rule 14a-6(i)(3).
PLEASE COMPLETE AND RETURN THE RED PROXY CARD
<PAGE>
OPPOSITION PROXY 2
THIS IS THE SECOND OF TWO PROXY STATEMENTS OFFERED BY THE OPPOSITION GROUP.
BOTH STATEMENTS CALL FOR VOTES BY THE SHAREHOLDERS. PLEASE SIGN AND RETURN BOTH
RED PROXY CARDS IN THE ENCLOSED ENVELOPE. YOU MAY ONLY VOTE ON THE MATTER
- -----------------------------------------
REFERRED TO SPECIFICALLY ON EACH CARD.
The Certificate of Incorporation and the By-Laws of Summit Family
Restaurants, Inc. do not prohibit shareholders from bringing proposals before
Special Meetings of the Company. Since, in our opinion, Delaware General
Corporate Law does not prohibit shareholders from bringing any action before a
Special Meeting, the Opposition Group believes it proper to bring the proposals
herein before the shareholders, if the proposed merger fails. Management of the
company is germane to the merger question before the shareholders. Therefore the
Opposition Group believes the votes called for herein to be appropriate. Article
II, Section 2 of Summit's By-Laws state that, "Special meetings of the
shareholders, for purposes described in the notice of the meeting may be called
by the Board of Directors or by a committee of the Board of Directors which has
been duly empowered by the Board of Directors to call special meetings." The
Board may deem such matters out of order. The Opposition Group may ask the
Chancery Court of Delaware to rule on the matter prior to the Special Meeting or
to permit the proxies to be voted if the company rules the submission out of
order. The Opposition Group is presently consulting Counsel on the matter but
does not intend to provide an opinion of Counsel at this time. Certain matters
may be inconclusive until a determination is made by the Delaware court.
Holders of Common Stock of the Company will act upon the following matters
to be presented at the Special Meeting of the Shareholders on July 12, 1996, at
10:00 a.m. at the Howard Johnson Hotel, 122 West South Temple, Salt Lake City,
Utah, IF THE MERGER IS NOT APPROVED.
We urge you to complete, sign and date the enclosed Opposition Proxy and to
return it in the enclosed prepaid envelope. This will not prevent you from
attending the Special Meeting and voting your shares in person even if you have
previously returned your proxy card since the proxy is revocable up to the time
it is voted. Abstentions and broker non-votes will have the same effect as votes
against the removal of directors and against the new slate of directors.
RESIGNATION OR REMOVAL OF DIRECTORS
The Opposition Group believes that if the merger fails, it is in the best
interest of shareholders for the present Directors of Summit to resign and allow
new management and direction for Summit. The Certificate of Incorporation
provides that shareholders may remove all or part of the Board with not less
than 80% of the stock entitled to vote for directors.
The Board of Directors of Summit Family Restaurants, Inc. have not met in
eight months. Virtually all of the meetings referred to in the Summit Board
proxy statement were conducted over the telephone. The acting President/CEO of
Summit Family Restaurants, Inc., is a full time employee of the State of Utah as
a utilities commissioner. The former President of Summit and virtually all of
the Senior Vice Presidents have been terminated. A shareholders' meeting has not
been called in the past sixteen months. This Opposition Group has stepped
forward to analyze the offer to shareholders and to give our opinion as to
whether it is fair and equitable, and to provide representation through this
proxy statement where we believe the Summit Board has failed. We became involved
after the second reduction in the CKE offer to shareholders and the termination
of the officers of Summit prior to shareholder approval of the merger.
Summit Family Restaurants, Inc. consists of nine members. The Company's
Certificate of Incorporation provides that the Board of Directors shall consist
of three classes of directors with staggered three-year terms. One class of
directors is to be elected each year for a term of three years.
Three directors terms expire in 1996. Those are: (a) Mr. Norton Parker
who has been a Board member since 1976; Mr. Carl Hays who has been a director
since 1987; and Mr. Thomas J. Russo who has been a director since 1990.
PLEASE COMPLETE AND RETURN THE RED PROXY CARD
1
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Two directors are occupying seats for terms that expire in 1997. Those
are: (a) Mr. Norman Habermann who has been a director since 1994; and Mr.
Clark Jones who has been Chairman of the Board since 1981.
One director is occupying a seat which expires in 1998. That is Mr. Ronald
Paul, who has served on the board since 1989.
One seat was vacated by Mr. Don McComas when he was terminated by the
present Board of Directors in April, 1996. Two other seats are vacant and are
appointed by the holders of Summit's Series A Preferred Stock.
Shareholders are asked to vote for the resignation or removal of Directors,
if the merger between Summit Family Restaurants, Inc. and CKE Restaurants, Inc.
is not approved on the following basis:
1. Summit Family Restaurants, Inc. has had four consecutive years of
operational losses.
2. That the Board entered into an agreement to sell Summit for less than
book value of the company because, by its own account, it failed to
see a viable alternative direction.
3. That the Board acted to terminate much of the senior management of
Summit prior to shareholder approval of the merger incurring heavy
costs and leaving a void in management of the company.
4. That the Board has contracted to pay out or has paid out more than
$2 million, including change of control payments, investment banking
fees, legal fees, accounting fees, and proxy solicitation expenses in
attempting to complete this merger--depleting the company of resources.
5. That the President/CEO and Chairman of the Board is also a full time
employee of the State of Utah; and that the Chairman of the Special
Committee has sought a success fee for a transaction which provides
less than the book value of the company to shareholders while he
personally benefits.
We believe that the present Board of Directors has not been successful in
operating Summit Family Restaurants, Inc. in a number of years. We Oppose the
proposed merger because we believe the shareholders have not received a fair
offer for their company.
If the merger fails, the Opposition Group of 14% of the shareholders,
including a composite of the single largest common shareholder to one of the
smallest shareholders, believes the Board, which has less than two percent of
the voting shares of Summit Family Restaurants, Inc., should surrender its
control.
Shareholders are hereby asked to vote for the resignation of the directors
or for their removal if they fail to resign, if the proposed merger fails.
ELECTION OF DIRECTORS
The Board currently consists of nine members. The Company's Certificate of
Incorporation provides that the Board of Directors shall consist of three
classes of directors with staggered three-year terms. One class of directors is
to be elected each year for a term
PLEASE COMPLETE AND RETURN THE RED PROXY CARD
2
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of three years. There are three directors whose terms expire in 1996. The
affirmative vote of a majority of the shareholders present in person or by
proxy is necessary for the election of directors. The holders of the Common
Stock will vote on the following:
Class II Directors
(To Replace Three Directors Whose Terms Expire In 1996)
New Terms Expire 1999
MS. SUSAN W. TRENHAM, 50, is proposed to shareholders as the Chair of the
Board and CEO of Summit. Trenham has served in chief financial, chief
operational, and chief executive positions for more than twenty years and brings
the knowledge and contacts of investment banking to the table.
Susan Trenham began her career in government. From 1967 to 1969, she
served as press aide and legislative assistant to U. S. Congressman John
Dellenback of Oregon. From 1969 to 1974, she served in the American Embassies
in Zaire, Guinea, and Morocco, as the wife of an American diplomat, and as a
free lance writer--with articles published in American newspapers and magazines,
in publications going to thirty different countries, and writing for such
companies as Goodyear and for the World Bank. In 1974, she returned to the
United States where she was recruited by the President's Consultant on Consumer
Affairs, Esther Peterson, to join the staff of a new joint White House and
Congressional Commission under President Ford. She was subsequently promoted to
Assistant Director developing and supervising a staff of thirty people. The
General Accounting Office later estimated that recommendations made by her and
her staff, and negotiated by her to be adopted by Federal agencies and the
Congress, resulted in more than $3 billion in savings to the taxpayer. In 1978,
she served for four months in the Carter White House as an analyst on the staff
of Stuart Eizenstadt, preparing a White Paper for the President on the
constitutional issues of privacy in financial and medical records.
In 1979, she became Special Assistant to the U. S. Comptroller of the
Currency, the regulator for national banks. Ms. Trenham specialized in
international banking issues and market surveillance issues for the Comptroller.
When the silver market crashed she headed the investigation of the markets on
behalf of the banking agencies. She also served simultaneously on the White
House Conference on Small Business and received special recognition from
President Carter. Subsequently, she was named by President Reagan as Executive
Director of the U. S. Commodity Futures Trading Commission, the regulator of
commodity exchanges in the United States with a $30 million budget and 470
person staff. In that capacity she directed all financial, data processing,
leasing, strategic planning, and budgetary functions for the Commission. The
agency had just gone through the most difficult time ever in the commodity
markets when she took over. She upgraded the data processing and surveillance
systems, and along with new Commissioners, restored the credibility and
production of the Commission. Subsequently she left the government to develop
and patent the first computerized system for trading energy futures. That
system remains state of the art today. She served as president of the World
Energy Exchange in Dallas, Texas, and simultaneously as a partner in the Rand
Financial Group raising venture capital and structuring debt financing. She
was named a Dallas Press Club Headliner in 1982, for bringing business
innovation to Dallas.
In 1988, she came to California as Chief Financial Officer of World Vision
International, Inc., a $135 million humanitarian relief organization with 16,000
projects worldwide. She bought First Global Securities, Inc. in 1991, and
remains as Co-Chair and CEO today. She served simultaneously as Treasurer and
Chief Financial Officer of CAS Refining, Inc. in 1990, having structured the
debt financing for crude operations of the refinery. She has structured and
obtained over $400 million in financing for clients for various projects.
PLEASE COMPLETE AND RETURN THE RED PROXY CARD
3
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MR. HAROLD FOX, 53, is proposed to be CFO of Summit and to serve on the
Board of Directors. Mr. Fox began his business career with Coopers & Lybrand in
1967. While at Coopers & Lybrand, he obtained his CPA license and served in
various capacities including Audit Supervisor and Senior Manager in the
Management Consulting Services Division. In 1975, Mr. Fox joined W. R. Grace &
Co. where he served as an Assistant Corporate Controller, Deputy Corporate
Controller and Executive Vice President and Chief Financial Officer of Grace
Restaurant Company. During Mr. Fox's tenure, Grace Restaurant Company owned and
operated over 800 restaurants with sales in excess of $1.1 billion.
Mr. Fox subsequently became a founding shareholder and Vice President of
Finance for American Restaurant Group, acquiring assets in excess of $350
million, including Stuart Anderson's Black Angus Restaurants, Grandy's, Spoons
and Spectrum Foods. When the major shareholders of American Restaurant Group
acquired Del Taco and Naugles, Mr. Fox transferred to the new entity as
Executive Vice President and Chief Financial Officer. In that capacity he
implemented cost reduction savings that decreased G&A expenses from $14.0
million to $6.4 million and participated in a turn around situation that moved
the company from a negative $5.0 million cash flow to a positive $10.2 million.
In 1993, Mr. Fox sold his 25% interest in Del Taco to GE Capital and joined R.
J. Morris Enterprises as a Partner. Mr. Fox served on the boards of Grace
Restaurant Company and Applebys Restaurants.
Mr. Fox is a graduate of the City University of New York and attended
graduate business school at New York University. He is a member of the American
Institute of Certified Public Accountants and the California Society of
Certified Public Accountants.
MR. JAMES F. POMROY, 61, is Chairman of InterNutria, Inc.--a company which
develops and markets nutrient based foods and beverages. Early in his career Mr.
Pomroy was Senior Product Manager for Colgate Palmolive Co. From 1963 to 1965,
he was Marketing Director Human Foods for Ralston Purina Company and from 1965
to 1970 he was Vice President and Partner, heading the consumer marketing
practice of Booz Allen & Hamilton. From July, 1983 to March, 1989, he was Chief
Executive Officer of Sundor Brands, Inc., a beverage company based in Darien,
Connecticut. Some of the brand names included were Texsun Grapefruit, Sunny
Delight Orange Drink and Rolling Rock Beer--growing the company from $60 million
to over $300 million in sales. In April, 1989, Sundor was sold to Proctor and
Gamble. Mr. Pomroy served as Chief Executive Officer of Drake Bakeries, Inc.,
the largest bakery in the Northeast in which his financial partner was the
Rockefeller Group. Drake was sold to Culinar Bakeries of Montreal in December
1991. From 1992 to 1994, Mr. Pomroy organized a leveraged buyout to acquire
Everfresh Juice Co. and Sundance Beverages, and merged the two companies to form
Everfresh Beverages. Nutriceutical Products Corporation was spun out from
Everfresh Beverages in 1994 and acquired by InterNutria in 1996. Mr. Pomroy
graduated from Allegheny College and received his MBA from Harvard University.
Class I
(To Replace Vacancy of Don M. McComas)
Term Expires 1998
MS. VIDA ICENOGLE, 38, grew up in California and graduated from California
State University, Los Angeles. She received her MA from Simmons College in
Boston and has concentrated in Investment Management, Marketing, and Client
Servicing. She is a former Assistant Vice President of Security Pacific Bank and
Vice President and Director of Investment Marketing for Republic Bank Dallas.
She is a principal in Zuidema & Icenogle,
PLEASE COMPLETE AND RETURN THE RED PROXY CARD
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Inc. representing clients such as Breau Capital Management, Boston; Sandler
Capital Management, New York; Finovelec, Paris. She presently markets financial
advisors to pension, trust, and capital intensive entities. She serves on the
Board of Directors of Zuidema & Icenogole and World Vision, U. S. She is a
member of the Association of Investment Management Sales Executives (AIMSE).
Class III
(To Replace Directors Who Resign or are Removed by the Shareholders)
Terms Expire 1997
MR. EUGENE A. CAFIERO, 69, former President of the Chrysler Corporation,
and former President of the Delorean Motor Co. is Chairman of VTI Corporation, a
lighting manufacturing company based in Connecticut. He is former CEO of the KDI
Corporation, a NYSE conglomerate which he took from $250 million to $325 million
in sales in two years doubling the price of the stock. He is a graduate of
Dartmouth College and the Sloan School of Management, Massachusetts Institute of
Technology, and Wittenberg University Doctor of Science Honorary. Named
Executive of the Year, Thunderbird School 1977.
MS. BEVERLY SASSOON, 50, was born in Edmonton, Canada and raised in
Burbank, California. She began an acting career at the age of eighteen and
appeared in numerous films for Columbia Pictures. While shooting a film, Beverly
met and married Vidal Sassoon. She left the entertainment business and for the
next decade was involved with the development and growth of the Sassoon brand--
focusing on product development, promotion, public relations and corporate
positioning. She also served on the Board of Directors of the Sassoon
Corporation. During her involvement the entity grew from a multifaceted hair
salon to worldwide franchising and product distribution. Among her other
credits were a collaborative publishing effort, A Year of Health & Beauty (Simon
-------------------------
& Shuster, 1976), Beauty for Always (Avon Press. 1980) and a novel in 1990 for
-----------------
Pocket Books. Ms. Sassoon serves as a contributing health and beauty editor for
a number of magazines.
Series A - Preferred
The holders of Series A Convertible Preferred Stock of the Company, are
entitled to appoint two members to the Board of Directors. There are presently
two vacancies to be filled by the owners of the Preferred.
President of a New Restaurant Division
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MR. ROBERT MORRIS, 60, will be appointed by the new Board as the President
of the Restaurant Division. Robert Morris is a native Southern Californian and
has been in the restaurant and recreational business all of his life. He has
founded and operated many successful restaurants in the Los Angeles area over
the past twenty-five years. In 1973, he opened Gladstone's 4 Fish in the Santa
Monica Canyon. In 1981, Gladstone's moved to its current location at Sunset and
Pacific Coast Highway thus becoming Gladstone's Malibu and one of the top
grossing restaurants in America. He was the first restaurateur to exceed $10
million in sales in a single location. At the time of his departure sales for
the one unit were in excess of $15 million. He also originated the original
Jetty, R. J.'S, the Rib Joint, Adam's, Sea View Seafoods on the Santa Monica
Pier and revitalized the Malibu Sea Lion. Mr. Morris' company was acquired in
1983 by the W. R. Grace Company and became the Mor Food `n Fun division of the
Grace Restaurant Company. As part of the Grace Restaurant Company he developed
and managed many restaurants in southern California. Mr. Morris subsequently
became Chairman and Chief Executive Officer of California Beach Restaurants,
Inc. which owns Gladstone's Malibu and R. J.'S the Rib Joint. In 1992, Bob left
his position in order to assume the management contract for MCA's Universal
Gladstone's at Universal CityWalk.
PLEASE COMPLETE AND RETURN THE RED PROXY CARD
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Today, Robert J. Morris Enterprises, of which Robert Morris and Harold Fox
are principal owners, is based in Universal City. In partnership with MCA
Universal, the company owns and operates Gladstone's Universal, a 750 seat
restaurant in the heart of Universal CityWalk at Universal Studios Hollywood,
with sales of approximately ten million dollars annually and a return on
investment in excess of 40%. In addition, the company manages the food and
beverage service for Country Star restaurants, a publicly held company located
at Universal CityWalk and new locations slated for Las Vegas and Atlanta in
1996.
Nominees Expected to Serve
All nominees have agreed to serve in the offices for which they are
nominated. There are no pre-existing contracts for compensation and no previous
related transactions or contracts with the Company.
Other Matters
The Opposition Group knows of no other matters, other than those discussed
in Proxy 1 and Proxy 2 that will be brought before the Special Meeting.
Security Ownership of Proposed Directors and Management
At the present time none of the Officers or Directors proposed in this
proxy have beneficial ownership in Summit Family Restaurants, Inc. except for
Susan W. Trenham, who as the beneficial owner of First Global Securities, Inc.
beneficially owns five shares of Summit. It is expected that most or all of
proposed officers or directors will acquire, through purchase or options,
positions in the company.
Solicitation Otherwise Than Through Mail
Solicitation for the Opposition Proxy will be through the mail and by
telephone. If shareholders have questions they may contact Susan W. Trenham at
(818) 568-8800.
Costs of Soliciation
Costs of the soliciation will be borne by the Opposition Group. Total
administrative, legal, filing, printing, and distribution costs for the two
proxy statements are $30,000 to date. Estimated total cost is $60,000. If the
proposed merger is successfully defeated and a new management and board is
approved by Shareholders as outlined herein, the Company may be asked to
reimburse the group for its expenses.
PLEASE COMPLETE AND RETURN THE RED PROXY CARD
6
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Contracts, Arrangements, or Understandings
No participant or associate is, or was within the past year, a party to
any contract, arrangements or understandings with any person with respect to any
securities of the company. No participant has had any related transaction of any
nature with Summit./1/
Security Ownership of Summit
The following table sets forth certain information as of May 14, 1966, with
respect to voting securities of Summit held by (1) each person who owns of
record, or is known by the Opposition Group to own beneficially, more than five
percent of any class of voting securities of Summit.
<TABLE>
<CAPTION>
Class Name and Address Amount Percent of Class
- ----- ---------------- -------- ----------------
<S> <C> <C> <C>
Series A CKE Restaurants, Inc. 946,714 100%
Convertible 1200 North Harbor Blvd.
Preferred Anaheim, CA 92803
Common Kennedy Capital Management 567,600 11.8%
10829 Olive Boulevard
St. Louis, Missouri 63141
Common Heartland Advisors, Inc. 512,500 10.6%
790 North Milwaukee St.
Milwaukee, WI 53202
Common David L. Babson & Co., Inc. 422,500 8.79%
One Memorial Dive
Cambridge, MA 02142
Common Dimensional Fund Advisors, Inc. 315,150 6.56%
1299 Ocean Avenue, Suite 1100
Santa Monica, CA 90401
</TABLE>
Shares Represented by this Opposition Proxy Statement
See schedule of Beneficial owners for trade dates and number of shares.
The aggregate number of shares represented in this Opposition Proxy Statement is
as follows:
<TABLE>
<CAPTION>
Class Name and Address Amount of Shares
- ----- ---------------- ----------------
<C> <S> <S>
Common First Global Securities, Inc. 5
790 East Colorado Blvd., #500
Pasadena, Ca. 91101
Common Kennedy Capital Management, Inc./2/ 567,600
10829 Olive Boulevard
St. Louis, Missouri 63141
Common William H. Burgess 4,000
550 Palisades Drive
Palm Springs, Ca. 92262
Common Joe Campa & Associates 14,000
301 East Colorado, Suite 800
Pasadena, Ca. 91101
Common Michael E. Portnoy 42,250
14 Winding Brook Road
Newtown, CT. 06471
Common Howard Foster Company 26,000
80 East Sir Francis Drake Boulevard
Number C
Larkspur, Ca. 94939
</TABLE>
/1/ First Global Securities, Inc. issued a purchase recommendation on Summit
Family Restaurants, Inc. in September, 1994. In August, 1995 Summit
management asked First Global to consider representing them in a management
led buyout. First Global declined and returned unopened information on the
subject to the company. First Global had not requested the information. At
no time has First Global Securities, Inc. had any contracts or arrangements
with Summit Family Restaurants, Inc. Susan Trenham is the beneficial owner
of First Global Securities, Inc. and therefore of five shares of Summit.
/2/ Kennedy Capital Management, Inc. is owned by Gerald T. Kennedy. Kennedy has
power of attorney over all shares herein, including contested proxies. Joe
Campa & Associates is owned by Joe Campa. Campa has power of attorney over
all shares herein including contested proxies. Howard Foster Company is
owned by Howard Foster. Foster has power of attorney over all shares herein,
including contested proxies. All of the above are investment advisors.
PLEASE COMPLETE AND RETURN THE RED PROXY CARD
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<PAGE>
<TABLE>
<CAPTION>
Class Name and Address Amount of Shares
- ----- ---------------- ----------------
<C> <S> <C>
Common Mark R. Tonucci 5,000
142 Bennett Road
East Haven, CT. 06513
Common T. H. Fitzgerald 2,000
180 Church Street
Naugatuck, CT. 06770
Common Peter Sorokin 5,000
615 Fern Street
West Hartford, CT. 06107
Common Mark A. Fries 9,600
31 Zoar Road
Sandy Hook, Ct. 06482
Common Gary B. Davidson 4,100
3567 E. Sunrise, Suite 219
Tucson, Az. 85718
Harold Fox 0
1000 Universal Center Drive 679,955
Universal City, CA 91605 The Opposition Group
</TABLE>
Shareholders are requested to attend the meeting in person or by proxy. Whether
or not you plan to attend the meeting in person, please complete, sign and date
the enclosed proxy card and return it promptly in the enclosed envelope. Your
cooperation is appreciated since a majority of the Common Stock must be
represented, either in person or by proxy, to constitute a quorum for the
conduct of business.
PLEASE COMPLETE AND RETURN THE RED PROXY CARD
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Beneficial Owners
<TABLE>
<CAPTION>
Data Name Shares-Buy Shares-Sell
<S> <C> <C> <C>
12/29/95 First Global Securities, Inc. 5
02/15/95 Kennedy Capital Mgmt. 7,500
02/16/95 " 21,000
02/17/95 " 28,000
02/22/95 " 8,000
02/24/95 " 25,000
02/29/95 " 6,000
03/01/95 " 200
03/01/95 " 5,000
03/02/95 " 4,600
03/03/95 " 7,000
03/07/95 " 5,000
03/08/95 " 1,750
03/09/95 " 5,000
03/10/95 " 3,500
03/13/95 " 500
03/13/95 " 1,500
03/14/95 " 5,000
03/15/95 " 4,000
03/17/95 " 5,000
03/17/95 " 2,000
03/20/95 " 5,000
03/21/95 " 5,500
03/26/95 " 10,000
03/27/95 " 14,000
03/28/95 " 2,000
03/31/95 " 3,000
04/03/95 " 5,000
04/04/95 " 5,000
04/05/95 " 1,500
04/06/95 " 4,000
04/10/95 " 10,000
04/11/95 " 6,000
04/12/95 " 5,000
04/13/95 " 17,500
04/17/95 " 3,000
04/18/95 " 2,000
05/11/95 " 5,000
05/17/95 " 1,000
05/19/95 " 4,000
05/22/95 " 10,000
05/23/95 " 5,000
05/28/95 " 10,000
06/05/95 " 5,000
06/06/95 " 3,500
06/09/95 " 300
06/12/95 " 6,000
06/13/95 " 2,500
06/16/95 " 8,000
06/16/95 " 5,000
06/18/95 " 11,300
06/21/95 " 3,800
06/23/95 " 10,000
06/27/95 " 5,000
06/28/95 " 10,000
06/30/95 " 2,000
06/29/95 " 2,000
06/29/95 " 3,400
06/30/95 " 1,000
07/07/95 " 5,500
07/07/95 " 8,000
07/10/95 " 10,000
07/12/95 " 6,000
07/13/95 " 30,000
07/14/95 " 2,000
07/17/95 " 2,000
07/18/95 " 10,000
07/18/95 " 19,500
07/19/95 " 5,000
07/26/95 " 500
08/02/95 " 25,000
08/02/95 " 2,500
08/04/95 " 2,500
11/12/95 " 15,000
11/13/95 " 5,000
11/14/95 " 10,000
12/04/95 " 8,500
12/05/95 " 2,000
12/06/95 " 2,200
12/11/95 " 400
12/12/95 " 660
12/13/95 " 5,600
12/13/95 " 5,000
12/18/95 " 2,500
12/19/95 " 4,500
12/22/95 " 4,000
12/26/95 " 2,000
12/28/95 " 3,000
12/28/95 " 5,000
01/02/94 " 300
01/03/94 " 2,000
01/04/94 " 4,000
09/19/94 William H. Burguss 4,000
10/06/95 J.D. Camps & Assoc., Inc. 8,000
10/09/95 " 3,000
10/09/95 " 3,000
09/20/94 Michael E. Portnoy 2,000
10/27/94 " 4,000
12/09/94 " 6,000
08/16/95 " 5,000
08/17/95 " 2,000
08/17/95 " 3,000
09/21/94 " 1,200
09/23/94 " 3,000
05/11/95 " 2,000
05/30/95 " 1,000
05/31/95 " 500
10/12/95 " 200
11/02/95 " 5,000
11/16/95 " 3,000
11/22/95 " 5,000
03/20/95 " 2,150
03/22/95 " 3,300
12/16/94 Howard Foster Company 3,000
12/16/94 " 7,000
12/16/94 " 2,500
12/28/94 "
01/15/96 Mark R. Tonucci 4,500
11/20/95 " 500
09/27/94 T.H. Fitzgerald 2,000
08/16/95 Peter Sorokin 5,000
08/23/95 Mark A. Fries 200
08/23/95 " 1,400
11/03/95 Nancy Taylor (Fries Spouse) 3,000
11/16/95 " 2,000
02/09/95 Gary B. Davidson 600
02/09/95 " 1,000
02/13/95 " 1,500
02/13/95 " 1,200
02/13/95 " 3,100
02/16/95 " 400
</TABLE>
PLEASE COMPLETE AND RETURN THE RED PROXY CARD
9
<PAGE>
EXHIBIT B
The following article appeared in the Orange County Register on June 19, 1996.
Susan Trenham responded briefly to a question from the reporter. The article
has been deemed a part of the solicitation of the Opposition Proxy Group made
prior to the filing of the definitive proxy statement.
Susan Trenham made the statement attributed to her. The conclusions drawn in the
rest of the article are those of the reporter from other sources and are not
statements made by Susan Trenham.
BUSINESS
THE ORANGE COUNTY REGISTER, WEDNESDAY, JUNE 19, 1996
CKE's merger bid hits an obstacle
RESTAURANTS: Unhappy Summit shareholders say owners of Carl's Jr. aren't paying
enough for Utah chain.
By KELLY BARRON
The Orange County Register
ANAHEIM -- Deal-maker William P. Foley II, chairman of CKE Restaurants
Inc., is accustomed to the battles of business.
He didn't expect to encounter contention, however, when CKE -- owner of the
Carl's Jr. hamburger chain -- sought to buy money-losing Summit Family
Restaurants Inc. of Salt Lake City.
So while shareholders of Anaheim-based CKE celebrate a successful
turnaround at the annual meeting today, some Summit shareholders are giving
Foley and CKE a struggle.
Owners of 14 percent of Summit stock started a proxy fight among Summit
owners to halt the merger. Their beef: CKE's $31 million offer is too low.
"There really isn't very much upside for Summit shareholders," says Susan
Trenham, chief executive of First Global Securities Inc., which opposes the
buyout.
CKE and Summit officials say the deal is fair.
CKE first proposed buying Summit in December. Summit operates 123
restaurants, including JB's Restaurants, Home-Town Buffet and Galaxy Diner.
CKE's plan was to keep the '50s style Galaxy Diner, expand it, and sell off the
rest.
So far, it hasn't worked out that way. Unable to find buyers, CKE
currently intends to run all the Summit chains.
But first Summit has to get approval from shareholders to merge with CKE at
what could be a feisty Summit annual meeting July 12. That presents Foley, who
recently tussled with owners of Rally's Hamburgers, a challenge.
Opposing shareholders contend that the Summit chain could be worth as much
as $46 million, based on the company's assets. They also question CKE's ability
to successfully run Summit's mainly family-style restaurants.
The opposing proxy states: "While CKE has been successful in the short
term in restructuring and putting on a cleaned up face, and an 'in your face TV
advertising campaign' ....they still remain a fast-food entity with a limit to
the number of ways one can serve hamburgers, grilled chicken and high fat-
content food."
The opposition group also wonders how long CKE's skyrocketing stock, which
hit a recent high of $28 a share Monday, will continue to climb. As part of the
deal, CKE would give Summit shareholders about 1 CKE share for every 10 Summit
shares they own. The dissidents noted that Foley, several vice presidents and a
director sold more than $8 million in CKE stock recently.
So what's the dissidents' solution? Bring in veteran restaurant operator
Robert Morris and turn JB's into a California-themed restaurant called the Wave
Cafe. Lifeguards would greet patrons at the door.
David Pertl, Summit's chief financial officer, agrees that JB's is no
longer a viable concept. Summit also has other woes. The company has lost
money four out of the past five years, racking up $5 million in losses in 1995.
Pertl says CKE's offer is the best Summit can do, noting that the
dissidents' valuation doesn't include Summit's $26 million in liabilities.
<PAGE>
OPPOSITION PROXY CARD - NO. 2 Summit Family Restaurants, Inc.
Special Meeting of Stockholders -- To Be Held July 12, 1996
SOLICITED BY THE OPPOSITION GROUP
The undersigned hereby appoints Susan W. Trenham, as proxy of the
undersigned, with full power to appoint her substitute, to represent and to
vote, as designated below, all of the shares of common stock, of Summit Family
Restaurants, Inc. standing in the name of the undersigned at the above Special
Meeting and at any adjournment or postponement thereof,
(A) TO VOTE FOR THE RESIGNATION OR REMOVAL OF PRESENT DIRECTORS
THE PRESENT MEMBERS OF THE BOARD OF DIRECTORS: CLASS II DIRECTORS WHOSE TERMS
EXPIRE IN 1996, INCLUDING NORTON PARKER, CARL R. HAYS, THOMAS J. RUSSO; CLASS
III DIRECTORS WHOSE TERMS EXPIRE IN 1997, INCLUDING NORMAN N. HABERMANN, CLARK
D. JONES; CLASS I DIRECTOR RON N. PAUL WHOSE TERM EXPIRES IN 1998.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
THE RESIGNATION OR REMOVAL
OF ALL DIRECTORS LISTED ABOVE
Instruction: To vote against the resignation or removal of any director, write
the director's name on the space below.
- -------------------------------------------------------------------------------
(B) ELECTION OF NEW DIRECTORS
FOR [ ] AGAINST [ ] ABSTAIN [ ]
ALL NOMINEES LISTED BELOW
SUSAN W. TRENHAM, HAROLD FOX, JAMES POMROY, VIDA ICENOGLE, EUGENE CAFIERO, AND
BEVERLY SASSOON
Instruction: To vote against any individual nominee, write that nominee's name
on the space provided below.
- -------------------------------------------------------------------------------
THE OPPOSITION GROUP RECOMMENDS A VOTE FOR THE RESIGNATION OR REMOVAL OF
PRESENT DIRECTORS AND THE ELECTION OF NEW DIRECTORS. YOU MAY VOTE ONLY ON THE
MATTERS REFERRED TO ON THIS CARD
(PLEASE SIGN AND DATE ON THE REVERSE SIDE)
<PAGE>
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE
STOCKHOLDER ON THE REVERSE SIDE OF THIS PROXY. WHERE NO DIRECTION IS GIVEN,
SUCH SHARES WILL BE VOTED FOR THE RESIGNATION OR REMOVAL OF THE PRESENT
DIRECTORS OF SUMMIT FAMILY RESTAURANTS, INC.
Date , 1996
---------------------
--------------------------------------
(Signature of shareholder)
Please sign your name exactly as it
appears hereon and mail this proxy in
the enclosed envelope. Where there is
more than one owner, each should sign.
When signing as an executor,
administrator, guardian or trustee,
please add your title as such. If
executed by a corporation, the proxy
should be signed by a duly authorized
officer.
