<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the registrant /X/
Filed by party other than the registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
------------------------
NASH-FINCH COMPANY
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
------------------------
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a6(i)(4) and 0-11.
1 Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2 Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3 Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:*
------------------------------------------------------------------------
4 Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
*Set forth the amount on which the filing fee is calculated and state how its
determined.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1 Amount Previously Paid:
------------------------------------------------------------------------
2 Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3 Filing Party:
------------------------------------------------------------------------
4 Date Filed:
------------------------------------------------------------------------
<PAGE>
[LOGO]
NASH FINCH COMPANY
7600 FRANCE AVENUE SOUTH
EDINA, MINNESOTA 55435
------------------------
NOTICE OF THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 9, 1995
------------------------
NOTICE IS HEREBY GIVEN that the 1995 Annual Meeting of Stockholders of Nash
Finch Company ("Nash Finch") will be held at the Lutheran Brotherhood Building,
625 Fourth Avenue South, Minneapolis, Minnesota, on Tuesday, May 9, 1995, at
10:00 a.m., local time, for the following purposes:
1. To elect four directors to serve for three-year terms.
2. To consider and act upon a proposal to adopt the Nash Finch 1995
Director Stock Option Plan.
3. To transact such other business as may properly come before the meeting
or any adjournment or adjournments thereof.
Only stockholders of record as shown on the books of Nash Finch at the close
of business on March 20, 1995 are entitled to notice of and to vote at the
Annual Meeting or any adjournment or adjournments thereof.
Your attention is directed to the enclosed proxy statement and proxy card.
STOCKHOLDERS WHO DO NOT EXPECT TO ATTEND IN PERSON ARE URGED TO FILL IN, DATE,
SIGN AND RETURN PROMPTLY THE PROXY CARD IN THE ENCLOSED POSTAGE PAID ENVELOPE.
By Order Of The Board of Directors
Norman R. Soland
Vice President, Secretary
and General Counsel
April 3, 1995
<PAGE>
[LOGO]
7600 FRANCE AVENUE SOUTH
EDINA, MINNESOTA 55435
TELEPHONE NO. (612) 832-0534
------------------------
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD MAY 9, 1995
------------------------
INTRODUCTION
The Board of Directors of Nash Finch Company ("Nash Finch") solicits your
proxy for use at the Annual Meeting of Stockholders to be held on May 9, 1995
(the "Annual Meeting"), and any adjournment or adjournments thereof. A proxy
card is enclosed herewith. Any proxy given pursuant to this solicitation and
received in time for the Annual Meeting will be voted in accordance with the
instruc-tions given in such proxy. Any stockholder who executes and delivers the
proxy may revoke it at any time prior to its use by giving notice in writing to
the Secretary of Nash Finch, by filing a revoking instrument or a duly executed
proxy bearing a later date with the Secretary of Nash Finch, or by attending the
Annual Meeting and voting said stock in person. The execution by a stockholder
of a later dated proxy will revoke all proxies previously executed by such
stockholder. However, a stockholder who attends the Annual Meeting need not
revoke his proxy and vote in person unless he wishes to do so. This proxy
material is first being mailed to the Nash Finch stockholders on or about April
3, 1995.
PURPOSES OF MEETING
The following business will be attended to at the Annual Meeting (the Board
of Directors recommends a vote FOR the following):
FIRST: To elect four directors to serve for three-year terms.
SECOND: To consider and act upon a proposal to adopt the Nash Finch 1995
Director Stock Option Plan.
THIRD: To transact such other business as may properly be brought before
the Annual Meeting or any adjournment or adjournments thereof.
<PAGE>
OUTSTANDING SHARES; VOTING RIGHTS
The close of business on Monday, March 20, 1995 has been fixed by the Board
of Directors of Nash Finch as the record date for the determination of
stockholders entitled to notice of and to vote at the Annual Meeting. On March
20, 1995, Nash Finch had outstanding 10,874,455 shares of common stock, par
value $1.66 2/3 per share ("Common Stock"), each such share entitling the holder
thereof to one vote in person or by proxy. The holders of a majority of the
total shares issued and outstanding (5,437,228 shares), whether present in
person or represented by proxy, will constitute a quorum for the transaction of
business at the Annual Meeting.
Shares of Common Stock represented by properly executed proxies will be
voted in accordance with the choices specified therein, and where no choice is
specified, such shares will be voted (i) for the election of the four nominees,
(ii) for the adoption of the Nash Finch 1995 Director Stock Option Plan (the
"Non-Employee Director Plan"), and (iii) with respect to any other business
which may properly come before the Annual Meeting or any adjournment or
adjournments thereof, according to the best judgment of the proxies named on the
enclosed proxy card.
In general, shares of Common Stock represented by a properly signed and
returned proxy will be counted as shares present and entitled to vote at the
Annual Meeting for purposes of determining a quorum, without regard to whether
the proxy reflects votes withheld from director nominees or abstentions (or is
left blank) or reflects a "broker non-vote" on a particular matter (i.e., a
proxy returned by a broker on behalf of its beneficial owner customer that is
not voted on that particular matter because voting instructions have not been
received and the broker has no discretionary authority to vote).
Stockholders may vote for all nominees for director, or withhold authority
to vote for all or certain nominees. Withheld shares will be treated as shares
present and entitled to vote and will be counted as voted shares. In connection
with the other proposal, stockholders may vote for or against the proposal, or
abstain. Abstentions will be treated as shares present and entitled to vote but
not cast in favor of the proposal, thus having the same effect as votes against
the proposal. Broker non-votes, as to a particular matter, will be treated as
shares not entitled to vote on that matter, and thus will not be counted as
voted shares. The election of directors and approval of the Non-Employee
Director Plan proposal, under Nash Finch's Bylaws, requires the affirmative vote
of a majority of the total shares present and entitled to vote on each such
matter.
2
<PAGE>
PRINCIPAL STOCKHOLDERS AND BENEFICIAL
OWNERSHIP OF MANAGEMENT
Set forth in the following table is information, as of March 1, 1995 unless
otherwise indicated, pertaining to (a) the individual ownership of Common Stock
by directors, nominees and named executive officers and (b) the ownership of
Common Stock by directors and executive officers as a group. Nash Finch has no
knowledge of any person or entity which beneficially owns more than 5% of the
outstanding Common Stock. Options exercisable within 60 days after March 1, 1995
are set forth in note (2) to the table.
<TABLE>
<CAPTION>
SHARES OF COMMON
STOCK
BENEFICIALLY
OWNED (1)(2)
---------------------
PERCENT
NAME AND ADDRESS OF BENEFICIAL OWNER AMOUNT OF CLASS
- -------------------------------------------------- ---------- --------
<S> <C> <C>
Carole F. Bitter 500 *
Harold B. Finch, Jr. 130,589(3) 1.20%
Richard A. Fisher 1,000 *
Alfred N. Flaten 5,600(4) *
Allister P. Graham 1,000 *
John H. Grunewald 2,000 *
Richard G. Lareau 3,500(5) *
Russell N. Mammel 32,760(6) *
Donald R. Miller 1,041(7) *
Robert F. Nash 107,165(8) *
Jerome O. Rodysill 21,015(9) *
Arthur C. Wangaard, Jr. 2,800 *
David W. Bell 4,847(10) *
Norman R. Soland 3,050(11) *
Clarence T. Walters 990(12) *
All Directors and Executive Officers as a Group 325,008(13) 2.99
(21 persons)
<FN>
- ------------------------
* Less than 1%.
(1) Unless otherwise noted, all of the shares shown are held by individuals or
entities possessing sole voting and investment power with respect to such
shares.
(2) Not included are shares of Common Stock which may be acquired within 60
days of March 1, 1995 by the persons and group identified in this table
upon the exercise of options granted under the Nash Finch 1994 Stock
Incentive Plan. Shares of Common Stock issuable upon the exercise of
options include: 10,000 shares for the estate of Mr. Finch; 1,400 shares
for Mr. Flaten; 600 shares for Mr. Nash; 750 shares for Mr. Bell; 600
shares for Mr. Soland; 560 shares for Mr. Walters; and,
</TABLE>
3
<PAGE>
<TABLE>
<S> <C>
17,740 shares for all directors and executive officers as a group. The
following assumes the exercise of these options for purposes of calculating
the percent of Common Stock deemed to be beneficially owned by such
individual or group: the estate of Mr. Finch, 1.29%; each named executive
officer and director of Nash Finch, less than 1%; and the directors and
executive officers of Nash Finch as a group, 3.15%.
(3) Mr. Finch died on November 12, 1994. These shares are beneficially owned by
Mr. Finch's estate.
(4) Includes 4,025 shares owned beneficially by Mr. Flaten and his wife jointly
as to which he shares voting and investment power and 1,000 shares owned
beneficially by Mr. Flaten's wife as to which he may be deemed to share
voting and investment power, but as to which he disclaims any beneficial
interest.
(5) Includes 1,500 shares owned beneficially by Mr. Lareau's wife as to which
he may be deemed to share voting and investment power, but as to which
shares he disclaims any beneficial interest.
(6) Includes 3,500 shares owned beneficially by the estate of Mr. Mammel's
deceased wife, as to which he exercises voting and investment power as
personal representative of the estate.
(7) Reflects ownership as of March 8, 1995.
(8) Includes 28,082 shares owned beneficially by Mr. Nash's wife as to which he
may be deemed to share voting and investment power, but as to which he
disclaims any beneficial interest.
(9) Includes 10,620 shares held by a trust for the benefit of Mr. Rodysill's
wife, of which Mr. Rodysill is a co-trustee with his son and as to which he
shares voting and investment power.
(10) The shares are owned beneficially by Mr. Bell and his wife jointly and as
to which he shares voting and investment power.
(11) The shares are owned beneficially by Mr. Soland and his wife jointly and as
to which he shares voting and investment power.
(12) The shares are owned beneficially by Mr. Walters and his wife jointly and
as to which he shares voting and investment power.
(13) Includes 59,264 shares as to which voting and investment power are shared
or may be deemed to be shared.
</TABLE>
4
<PAGE>
ELECTION OF DIRECTORS
NOMINATION
The Nash Finch Restated Certificate of Incorporation and Bylaws, each as
amended, provide that the Board of Directors shall consist of not less than nine
nor more than 17 members, as determined from time to time by the Board of
Directors, divided into three classes of as nearly equal size as possible. The
term of each class of directors is three years, and the term of one class
expires each year in rotation. The Board of Directors has determined that there
will be 10 directors of Nash Finch for the ensuing year.
The terms of four current members of the Board of Directors will expire at
the Annual Meeting. The terms of the remaining seven current members of the
Board of Directors will not expire this year, but will expire as indicated
below. Mr. Wangaard, a current director, has notified the Board that he will
retire his directorship effective as of the date of the Annual Meeting. The
directorship being vacated by Mr. Wangaard's retirement and the directorship
vacated by Mr. Finch's death will not be filled, such that the Board of
Directors shall consist of ten members. The Board of Directors has nominated
four of the nominees listed below to serve as directors of Nash Finch for terms
of three years, expiring at the 1998 Annual Meeting of Stockholders or until
their successors are duly elected and qualified. The four nominees currently
serve as directors and have served continuously from the dates indicated below.
The affirmative vote of a majority of the total shares represented in person
or by proxy and entitled to vote is required for the election of the four
nominees. It is the intention of the persons named in the enclosed form of proxy
to vote such proxy for the election of the four nominees named in the proxy,
unless otherwise directed by the stockholder. Nash Finch's Board of Directors
recommends a vote FOR the election of each of the nominees. While the Board of
Directors has no reason to believe that any of those named will not be available
as a candidate, should such a situation arise, the proxy will be voted for the
election as directors of such other persons as determined in the discretion of
the proxies named on the enclosed proxy card. Proxies cannot be voted for a
greater number of persons than the number of nominees named.
5
<PAGE>
INFORMATION ABOUT DIRECTORS AND NOMINEES
<TABLE>
<CAPTION>
DIRECTOR
NAMES AGE PRINCIPAL OCCUPATION SINCE
- -------------------------------- --- ---------------------------------------------------------------- ---------
<S> <C> <C> <C>
NOMINEES FOR THREE-YEAR TERMS EXPIRING IN 1998:
Alfred N. Flaten 60 President and Chief Executive Officer of Nash Finch 1990
Allister P. Graham 58 Chairman and Chief Executive Officer of The Oshawa Group Limited 1992
(food and pharmaceutical distributor in Canada)
Richard G. Lareau 66 Partner, Oppenheimer Wolff & Donnelly (law firm) 1984
Jerome O. Rodysill 66 Retired Senior Vice President of Nash Finch 1974
DIRECTORS NOT STANDING FOR ELECTION THIS YEAR WHOSE TERMS EXPIRE IN 1997:
Russell N. Mammel 68 Retired President and Chief Operating Officer of Nash Finch 1974
Donald R. Miller 67 Management Consultant 1978
Robert F. Nash 61 Vice President and Treasurer of Nash Finch 1968
DIRECTORS NOT STANDING FOR ELECTION THIS YEAR WHOSE TERMS EXPIRE IN 1996:
Carole F. Bitter 49 President and Chief Executive Officer of Harold Friedman, Inc. 1993
(operator of retail supermarkets)
Richard A. Fisher 65 Retired Vice President -- Finance and Treasurer of Network 1984
Systems Corporation (manufacturer of data communications
systems)
John H. Grunewald 58 Executive Vice President, Finance and Administration, Polaris 1992
Industries, Inc. (manufacturer of recreational equipment)
Arthur C. Wangaard, Jr.(1) 67 Retired Vice President, Secretary and General Counsel of Nash 1968
Finch
<FN>
- ------------------------
(1) Mr. Wangaard has notified the Board that he will retire his directorship
effective as of the date of the Annual Meeting.
</TABLE>
OTHER INFORMATION ABOUT DIRECTORS AND NOMINEES
Except as indicated below, there has been no change in principal occupations
or employment during the past five years for the directors or nominees for
election as directors.
Mr. Fisher retired in December 1992 as Vice President -- Finance and
Treasurer of Network Systems Corporation, a position he had held for more than
five years.
Mr. Grunewald has served as Executive Vice President, Finance and
Administration of Polaris Industries, Inc., a manufacturer of recreational
equipment, since September 1993. He previously served as Executive Vice
President, Chief Financial Officer and Secretary of Pentair, Inc. for more than
five years, a position from which he retired in June 1993.
6
<PAGE>
Mr. Flaten's election as Chief Executive Officer was effective in November,
1994. His election as President and Chief Operating Officer of Nash Finch was
effective in November 1991. He had been elected Executive Vice President, Sales
and Operations of Nash Finch in February 1991. He was previously an operating
officer of Nash Finch, having served as Vice President, Corporate Retail
Operations from January 1989 to February 1991.
Mr. Lareau has been a partner in the law firm of Oppenheimer Wolff &
Donnelly for over 30 years. Oppenheimer Wolff & Donnelly has provided and is
expected to continue to provide legal services to Nash Finch. Mr. Lareau also
serves as a director of Merrill Corporation, Northern Technologies International
Corporation and Ceridian Corporation.
Mr. Mammel resigned in November 1991 as President and Chief Operating
Officer of Nash Finch, a position that he had held for more than five years, in
anticipation of his planned retirement which was effective January 1, 1992.
Mr. Rodysill retired in January 1994 as Senior Vice President, Store
Development and Construction of Nash Finch, a position he had held for more than
five years.
INFORMATION ABOUT BOARD AND ITS COMMITTEES
Standing committees of the Board of Directors include the Executive
Committee, the Audit Committee, the Compensation Committee and the Nominating
Committee.
The Executive Committee has substantially all of the authority and power of
the Board of Directors in the management of the business and affairs of Nash
Finch, as provided by Delaware corporation law, although the Executive Committee
is at all times subject to the direction and control of the full Board of
Directors. The current members of the Executive Committee are Alfred N. Flaten,
Robert F. Nash and Jerome O. Rodysill. In addition, Norman R. Soland is a
non-voting, advisory member of the committee. The Executive Committee met 15
times during fiscal 1994.
The Audit Committee reviews and monitors accounting policies and control
procedures of Nash Finch, including recommending the engagement of independent
public accountants and reviewing the scope of the audit. The current members of
the Audit Committee are Carole F. Bitter, Richard A. Fisher, John H. Grunewald
and Richard G. Lareau. The Audit Committee met four times during fiscal 1994.
The Compensation Committee determines salaries and bonuses for executive
officers, selects the officer and key employee participants and determines the
compensation awards to be made to such participants under the Nash Finch
Executive Incentive Bonus and Deferred Compensation Plan, and considers new
executive compensation plans for recommendation to the Board of Directors. The
Compensation Committee also administers the 1994 Stock Incentive Plan ("the 1994
Plan"), and will administer the Non-Employee Director Plan if such plan is
approved by the stockholders at the Annual Meeting. The current members of the
Compensation Committee are Carole F. Bitter, Richard A. Fisher, Russell N.
Mammel and Donald R. Miller. Alfred N. Flaten, as Chief Executive Officer of
Nash Finch, is a non-voting member of the committee. The Compensation Committee
met four times during fiscal 1994.
The Nominating Committee considers and recommends to the Board of Directors
the size of the Board, nominees who meet the criteria for Board membership, the
procedures for identifying potential Board nominees and nominees for election as
officers. In addition, the Nominating Committee
7
<PAGE>
recommends to the Board of Directors nominees for appointment to Board
committees as well as the functions, responsibilities and procedures for the
various Board committees. The current members of the Nominating Committee are
Richard A. Fisher, Alfred N. Flaten, Allister P. Graham, Richard G. Lareau and
Donald R. Miller. The Nominating Committee met three times during fiscal 1994.
Stockholder recommendations for director nominees may be considered, but there
are no established procedures for the submission of such recommendations to the
Nominating Committee for consideration.
During 1994, the Board of Directors held four regularly scheduled meetings
and one special meeting. All of the directors attended 75% or more of the
aggregate meetings of the Board of Directors and all committees on which they
served.
COMPENSATION OF DIRECTORS
DIRECTORS' FEES. Directors who are full-time employees of Nash Finch
receive no separate compensation for their services as directors. Directors who
are not full-time employees of Nash Finch receive out-of-pocket traveling
expenses incurred in attending Board and committee meetings, and through
February 28, 1994 received compensation of $800 for each Board meeting attended,
$500 for each committee meeting attended (or, $300 if held on the same day as a
Board meeting or by telephone conference), and a retainer of $1,000 per month.
From March 1, 1994 through February 28, 1995, such directors received $1000 for
each Board meeting attended, $600 for each committee meeting attended (or $400
if held on the same day as a Board meeting or by telephone conference), and a
retainer of $1000 per month. Effective March 1, 1995, such directors receive
$1,000 plus reasonable expenses incurred for each Board meeting attended, $750
plus reasonable expenses incurred for each committee meeting attended (or $500
if held on the same day as a Board meeting or by telephone conference), and a
retainer of $1,100 per month.
1995 DIRECTOR STOCK OPTION PLAN. Effective as of March 24, 1995, the Board
adopted the Non-Employee Director Plan. Subject to the approval of the
stockholders of the Non-Employee Director Plan at the Annual Meeting (see
description of the Non-Employee Director Plan on pages 17 through 19 of this
Proxy Statement), each director who is not an employee of Nash Finch will be
eligible to receive an annual grant of an option to purchase 500 shares of the
Common Stock immediately following each annual meeting of stockholders of Nash
Finch while the plan is in effect.
8
<PAGE>
EXECUTIVE COMPENSATION AND OTHER BENEFITS
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table sets forth the cash and non-cash compensation earned
during the fiscal years ending December 31, 1994, January 1, 1994 and January 2,
1993, by the two Chief Executive Officers who served as such during some portion
of the year ended December 31, 1994, and the four most highly compensated
executive officers of Nash Finch whose salary and bonus exceeded $100,000 for
the fiscal year ended December 31, 1994.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
----------------------
AWARDS
ANNUAL COMPENSATION ----------- PAYOUTS
------------------------------- SECURITIES --------- ALL OTHER
NAME AND FISCAL SALARY BONUS (1) UNDERLYING LTIP COMPENSATION (3)
PRINCIPAL POSITION YEAR ($) ($) OPTIONS (2) PAYOUTS ($)
------------------ --------- --------- --------- ----------- --------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Harold B. Finch, Jr. 1994 300,324 159,000 10,000 (4) --
Former Chairman of the Board, 1993 294,191 150,000 -- -- 7,874
Chief Executive Officer 1992 203,287 210,000 -- -- 8,860
and Director (5)
Alfred N. Flaten 1994 221,257 100,000 7,000 -- 4,944
President, Chief Executive 1993 199,452 85,000 -- -- 7,874
Officer and Director (6) 1992 127,054 125,000 -- -- 8,180
David W. Bell 1994 127,150 50,000 3,750 -- 4,944
Senior Vice President, 1993 118,674 33,000 -- -- 4,960
Retail Sales and Operations 1992 113,841 30,000 -- -- 3,326
Norman R. Soland 1994 102,219 33,000 3,000 -- 4,338
Vice President, Secretary 1993 97,233 29,500 -- -- 4,095
and General Counsel 1992 94,529 25,500 -- -- 4,508
Clarence T. Walters 1994 104,712 22,000 2,800 -- 4,009
Vice President, Management 1993 99,726 17,000 -- -- 3,727
Information Systems 1992 96,561 12,000 -- -- 4,160
Robert F. Nash 1994 92,745 33,000 3,000 -- 4,076
Vice President, Treasurer 1993 87,759 31,000 -- -- 4,174
and Director 1992 76,233 37,500 -- -- 4,342
<FN>
- ------------------------
(1) Cash bonuses for services rendered have been included as compensation for
the year earned, even though bonuses were actually paid in the following
year.
(2) Reflects the grant of options under the Nash Finch 1994 Stock Incentive
Plan. Refer to the table entitled "Option Grants in Last Fiscal Year" on
page 10 of this Proxy Statement for additional information regarding such
grants.
(3) "All Other Compensation" consists of contributions by Nash Finch in 1992,
1993 and 1994 to the Nash Finch Profit Sharing Plan.
</TABLE>
9
<PAGE>
<TABLE>
<S> <C>
(4) Mr. Finch's account under the Nash Finch Executive Bonus and Deferred
Compensation Plan became payable to his designated beneficiary on November
12, 1994. No benefits were paid, however, in 1994.
(5) Mr. Finch died on November 12, 1994. Hereinafter, all options, incentive
awards or other securities held by Mr. Finch shall be understood to be held
by Mr. Finch's estate.
(6) Effective November 15, 1994, Mr. Flaten succeeded Mr. Finch as Chief
Executive Officer. Prior to that time, Mr. Flaten had been the Chief
Operating Officer of the Company.
</TABLE>
STOCK OPTIONS
The following tables summarize option grants during the fiscal year ended
December 31, 1994 to the executive officers named in the Summary Compensation
Table and the potential realizable value of the options held by such persons at
December 31, 1994. During 1994, no options were exercised by the executive
officers named in the Summary Compensation Table.
OPTIONS GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
------------------------------------------------------- ANNUAL RATES
NUMBER OF OF STOCK PRICE
SECURITIES % OF TOTAL APPRECIATION FOR
UNDERLYING OPTIONS GRANTED EXERCISE OR OPTION TERM (2)
OPTIONS TO EMPLOYEES IN BASE PRICE EXPIRATION --------------------
NAME GRANTED (1) FISCAL YEAR ($/SH) DATE 5% 10%
- ------------------------ ----------- ----------------- ----------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Harold B. Finch, Jr. 10,000 3.3 16.875 11/12/95 $ 7,719 $ 15,407
Alfred N. Flaten 7,000 2.3 16.875 7/14/99 29,002 63,263
David W. Bell 3,750 1.3 16.875 7/14/99 15,537 33,891
Norman R. Soland 3,000 1.0 16.875 7/14/99 12,430 27,113
Clarence T. Walters 2,800 .9 16.875 7/14/99 11,601 25,305
Robert F. Nash 3,000 1.0 16.875 7/14/99 12,430 27,113
<FN>
- ------------------------
(1) Reflects the grant of options under the Nash Finch 1994 Stock Incentive
Plan. These options vest according to the following schedule: 20%
immediately upon the date of grant and 20% on each of the first four
anniversaries of the date of grant.
(2) These amounts represent certain assumed rates of appreciation only. Actual
gains, if any, on stock option exercises are dependent upon the future
performance of the Common Stock, overall market conditions and the
executive's continued involvement with Nash Finch. The amounts represented
in this table might not necessarily be achieved.
</TABLE>
10
<PAGE>
FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY OPTIONS AT
OPTIONS AT DECEMBER 31, 1994 DECEMBER 31, 1994 (1)
---------------------------- -------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ----------------------- ----------- --------------- ---------- -------------
<S> <C> <C> <C> <C>
Harold B. Finch, Jr. 10,000 0 -- --
Alfred N. Flaten 1,400 5,600 -- --
David W. Bell 750 3,000 -- --
Norman R. Soland 600 2,400 -- --
Clarence T. Walters 560 2,240 -- --
Robert F. Nash 600 2,400 -- --
<FN>
- --------------------------
(1) As of December 31, 1994, none of the options held by the executive officers
named in the Summary Compensation Table were "in-the-money."
</TABLE>
LONG-TERM INCENTIVE PLAN
The following table sets forth, information regarding (a) the number of
stock equivalent ("phantom stock") units allocated during the fiscal year ended
December 31, 1994 to each of the executive officers named in the Summary
Compensation Table under the Nash Finch Executive Bonus and Deferred
Compensation Plan (the "Deferred Compensation Plan") and (b) the number of
performance share units granted to such officers under the Nash Finch 1994 Stock
Incentive Plan (the "1994 Plan"). Each phantom stock unit has a base value of
$16.066.
LONG-TERM INCENTIVE PLAN -- AWARDS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
ESTIMATED FUTURE
PAYOUTS UNDER NON-
PERFORMANCE STOCK PRICE-BASED
NUMBER OF OR OTHER PLANS
SHARES, UNITS PERIOD UNTIL --------------------
OR OTHER MATURATION OR THRESHOLD TARGET MAXIMUM
NAME RIGHTS (#) PAYOUT (#) (#) (#)
- ----------------------- ------------- ------------- --------- --------- -----------
<S> <C> <C> <C> <C> <C>
Harold B. Finch, Jr. -- -- (1) -- -- --
20,331(2) 1994-1996 0 13,554 13,554
Alfred N. Flaten 2,040(3) -- (4) -- -- --
12,066(2) 1994-1996 0 8,044 8,044
David W. Bell 1,124(3) -- (4) -- -- --
5,010(2) 1994-1996 0 3,340 3,340
Norman R. Soland 859(3) -- (4) -- -- --
4,110(2) 1994-1996 0 2,740 2,740
Clarence T. Walters 805(3) -- (4) -- -- --
4,209(2) 1994-1996 0 2,806 2,806
Robert F. Nash 799(3) -- (4) -- -- --
3,729(2) 1994-1996 0 2,486 2,486
<FN>
- --------------------------
(1) Prior to his death, Mr. Finch was a participant in the Deferred
Compensation Plan (see footnote (3) below for additional information
concerning the Deferred Compensation Plan). Mr. Finch's Deferred
Compensation Plan account became payable to his designated beneficiary on
November 12, 1994. No benefits were paid, however, in fiscal 1994.
</TABLE>
11
<PAGE>
<TABLE>
<S> <C>
(2) These awards represent performance units granted under the 1994 Plan and
payable, to the extent earned, in shares of Common Stock (the "Performance
Units"). Payout of the Performance Units is tied to achieving specified
levels of earnings per share ("EPS") growth, average return on stock-
holders' equity ("ROE") and total stockholder return ("TSR"). Minimum and
maximum performance goals for each category have been determined by the
Compensation Committee and approved by the Board. If performance equals or
exceeds the maximum goal for the category, all of the Performance Units
allocated to the category are earned and paid out. If performance equals or
is less than the minimum goal, no Performance Units allocated to the
category are earned or paid out. If performance for a particular category
exceeds the minimum goal for that category, but is less than the maximum
goal, Performance Units are earned and paid out on a proportionate basis.
Performance Units allocated to EPS growth would be earned based upon 1994
performance and paid out in 1995. Performance Units allocated to ROE and
TSR would be earned based upon performance for the period 1994 through
1996, and would not be paid out until 1997. The minimum targeted EPS growth
was not achieved in 1994, and therefore, Performance Units allocated to
this category were not earned and will not be paid out in 1995. Since
payout of the Performance Units may not exceed 100% of the Performance
Units granted, the target award amount and the maximum award amount are the
same. More detail about the Performance Units is available in the
Compensation Committee Report on pages 13 through 15 of this Proxy
Statement.
(3) The Deferred Compensation Plan provides additional long-term incentive
compensation to selected executive officers and other key employees.
Participants are selected annually by the Compensation Committee which also
determines the amounts to be allocated to participants for the year.
Normally, the Deferred Compensation Plan is effective only if the
consolidated net income of Nash Finch and its subsidiaries exceeds 6% of
the stockholders equity as shown on Nash Finch's current financial
statements, and then only 5% of such excess is available for allocation to
participants. The Compensation Committee may, however, in its discretion,
authorize any amount to be allocated under the Deferred Compensation Plan.
The amount allocated annually to each participant cannot exceed one-third
of the participant's annual base salary. The entire allotment to a
participant is contingently credited to the participant's account at the
end of each year. (Nash Finch does not fund or set aside any cash amounts
which are allocated to participants; instead, bookkeeping entries are
made). Allotments credited to each participant's account are converted to
share equivalents of Common Stock and each participant is entitled to
additional credits for dividends paid on such share equivalents during each
year. The dividend credits are also converted to share equivalents. In
addition, the value of each participant's account is increased or
decreased, whichever is applicable, by an amount equal to the increase or
decrease in fair market value of the share equivalents during the year,
provided that the participant is always entitled to the amounts originally
allocated regardless of any decrease in the market value of share
equivalents.
(4) Amounts contingently credited to the participant's account are payable to
the participant in cash upon termination of employment, except that
benefits may be totally or partially forfeited under certain circumstances.
</TABLE>
CHANGE IN CONTROL AGREEMENTS
The Board of Directors has authorized Nash Finch to enter into change in
control agreements with certain executive officers and key employees of Nash
Finch and its subsidiaries. Pursuant to these agreements, certain payments and
benefits would be provided to such employees in the event their employment is
terminated under certain conditions, including a change in control of Nash
Finch.
12
<PAGE>
If an employee is terminated by Nash Finch or a subsidiary within 24 months
of a change in control (or, in limited circumstances, prior to such a change in
control) other than by reason of death, disability, retirement or cause, or the
employee terminates for good reason, Nash Finch will pay or cause to be paid to
the employee a lump sum equal to the employee's highest monthly compensation (as
defined in the employee's change in control agreement) multiplied by a number of
months equal to either 12, 24 or 36 months and will maintain or cause to be
maintained benefit plans (including health, life, dental and disability) for the
employee and his or her dependents for 12, 24 or 36 months. Subject to certain
limitations, the multiple referred to above is 36 months for Mr. Flaten, 24
months for Mr. Bell, Mr. Soland, Mr. Walters and Mr. Nash, and 24 months or 12
months for all other designated employees.
The options and performance units granted in 1994 to the executive officers
named in the Summary Compensation Table were granted under the 1994 Plan.
Pursuant to the terms of the 1994 Plan and the agreements evidencing such
awards, the following occurs upon a change in control of Nash Finch: (i) for
options granted under the 1994 Plan, the Compensation Committee, in its sole
discretion, may (a) accelerate the exercisability of options such that the
options will be immediately exercisable upon the change in control, or (b)
determine that the optionee will receive, as of the effective date of the change
in control, cash in an amount equal to the excess of the fair market value of
the option shares immediately prior to the effective date of the change in
control over the exercise price per share of the options; and (ii) for
performance units granted under the 1994 Plan, the Compensation Committee, in
its sole discretion, may (a) adjust the number and kind of securities subject to
the performance unit and the performance criteria which must be fulfilled in
order to earn the award shares, and (b) in the event of involuntary termination
of employment following a change in control, adjust the formula provided in the
performance award to provide for the issuance of more awards shares than would
be the case if the involuntary termination were not preceded by a change in
control.
Pursuant to the terms of the Deferred Compensation Plan, the following
occurs upon a change in control of Nash Finch: (i) an additional amount would be
allocated to the account of each participant equal to the amount allocated in
the previous year; (ii) forfeiture provisions of the Deferred Compensation Plan
would lapse; and (iii) the total balance of the participant's account would
become payable in full.
REPORT OF COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
OVERVIEW. The Compensation Committee of the Board of Directors is comprised
of directors who are not full-time employees of Nash Finch. The Chief Executive
Officer of Nash Finch, EX OFFICIO, is a non-voting member of the Compensation
Committee.
The Compensation Committee was established by the Board of Directors in May
1992, and overall responsibility for executive compensation is being
concentrated under its authority pursuant to delegation by the Board. As
described under "Election of Directors -- Information About Board and Its
Committees," the Compensation Committee determines annual salaries and bonuses
of executive officers and certain other key employees, including the Chief
Executive Officer; considers and makes recommendations to the Board concerning
new executive compensation plans; administers the Deferred Compensation Plan;
administers the 1994 Stock Incentive Plan; and will administer the Non-Employee
Director Plan if approved by the stockholders at the Annual Meeting.
As part of the Company's on-going efforts to ensure the continuing
effectiveness and appropriateness of its executive compensation program, the
program was reviewed in 1993 with the assistance of an outside consultant. The
review led to various changes in Nash Finch's policies regarding executive
compensation including clarification and restatement of the basic objectives of
the program, a more defined performance focus, and an increased emphasis on
performance-related stock incentives.
13
<PAGE>
COMPENSATION PHILOSOPHY. The fundamental objective of Nash Finch's
executive compensation program is to support the achievement of the Company's
business objectives. As such, the Company's philosophy is that executive
compensation should be designed to achieve the following objectives:
- Enable the Company to attract and retain qualified key executives whose
skills and capabilities are needed to assure the continued growth and
success of Nash Finch in a highly competitive industry.
- Provide an incentive to executives by tying a meaningful portion of
compensation to the achievement of Company financial objectives.
- Align the interests of executives with those of Nash Finch stockholders by
providing a significant portion of compensation in Common Stock.
To maintain an appropriately competitive level of total compensation,
comparisons are made with the ranges of compensation paid to persons holding
comparable positions at other companies of similar size, with primary emphasis
on the food distribution industry. These comparisons, by necessity, extend
beyond the companies included in the peer group for the comparative performance
graph shown below, given the number and size of companies included in the
industry group.
COMPONENTS OF EXECUTIVE COMPENSATION. The principal components of executive
compensation include salaries, cash bonuses and longer-term incentive
compensation.
Salaries and cash bonuses for executive officers, including Mr. Flaten and
the other executive officers named in the Summary Compensation Table, are
determined annually, taking into consideration the executive's level of
responsibility and experience, individual and corporate performance, and
competitive compensation comparisons. While no specific criteria for measuring
individual and corporate performance are employed, each executive officer's
performance is evaluated by the Chief Executive Officer and reviewed by the
Compensation Committee. Similarly, in determining bonuses for executive
officers, the financial results of the Company are reviewed in light of various
objectives for the year, historical performance levels, external factors and
competitive considerations.
Longer-term incentive compensation consists of awards of phantom stock units
to certain executives under the Deferred Compensation Plan. Such awards are
intended primarily to serve as a means of retaining key executives by providing
supplemental retirement income. The potential value of such awards is linked to
stock price appreciation providing an additional long-term incentive to increase
stockholder value during an executive's career with Nash Finch. The Compensation
Committee administers the Deferred Compensation Plan and is responsible for
selecting the executive officers and other key employees for participation in
the plan and determining the amounts of compensation awards allocated to the
selected participants. Refer to "Executive Compensation and Other Benefits --
Long-Term Incentive Plan" for a description of the key terms of the Deferred
Compensation Plan.
It has also been Nash Finch's policy to encourage a broad range of employees
(including executive officers) to participate in stock ownership. For this
purpose, a number of stock option plans have been adopted over the years. The
size of individual stock option grants made under such plans have largely been
determined by the employee's position and ability to purchase shares, as
measured by his or her cash compensation level.
A result of the 1993 review of the executive compensation program, and the
Compensation Committee's recommendations to the Board of Directors based
thereon, was the proposal and adoption by the stockholders at the 1994 Annual
Meeting of the 1994 Plan.
14
<PAGE>
The 1994 Plan, among other things, authorizes the Compensation Committee to
award rights to executive officers and other key employees to receive shares of
Common Stock upon the achievement of established performance goals. Such awards
are referred to in the 1994 Plan as "Performance Units."
Such Performance Units would have a maximum value at grant ranging from 60%
of a participant's 1994 base salary to 120% for the Chief Executive Officer. For
1994, the number of share units which could be earned (an equal number of share
units for each of three corporate performance objectives) would be determined on
the basis of the average closing sales prices for the Common Stock for the last
calendar quarter of 1993. The three performance categories, which the Board of
Directors has approved, are earnings per share (EPS) growth in 1994 compared
with the highest reported EPS for the preceding four years, average return on
stockholders' equity (ROE) for the three-year period beginning in 1994, and
total stockholder return (TSR) for the same three-year period. Minimum and
maximum performance goals have been determined by the Compensation Committee and
approved by the Board of Directors for each category. In no case will any
portion of an award for a performance category be earned unless the minimum for
that category is exceeded. An award for EPS growth would be earned based on
performance in 1994 and paid out in 1995. Awards for ROE and TSR would, to the
extent earned, not be paid out until 1997. Awards paid out in Common Stock will
be restricted as to transferability for three years following the issuance of
such shares.
The Compensation Committee believes that such performance-based awards will
serve the purpose of more closely aligning executive and stockholder interests
in that the executives will benefit only if stockholder value is enhanced. Also,
for this purpose, in 1994 the Compensation Committee established stock ownership
guidelines for executive officers who will be encouraged, but not required, to
satisfy these guidelines within three to five years. The stock ownership
guideline for the Chief Executive Officer is five times annual base salary.
CHIEF EXECUTIVE OFFICER COMPENSATION. For the 1994 fiscal year, Mr. Finch
or his estate received a salary of $300,324, and a bonus of $159,000. Mr. Flaten
received a salary of $221,257, a bonus of $100,000, and a grant of 2,040 phantom
stock units under the Deferred Compensation Plan. The salary and bonus of each
of Mr. Finch and Mr. Flaten were determined in accordance with the policies
outlined above.
Carole F. Bitter (appointed 2/14/95)
Richard A. Fisher
Russell N. Mammel
Donald R. Miller
Alfred N. Flaten, (EX OFFICIO)
Members of the Compensation Committee
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Flaten, the Chief Executive Officer of Nash Finch, is a non-voting
member of the Compensation Committee. Mr. Mammel, the retired President and
Chief Operating Officer of Nash Finch, is also a member of and chairs the
Compensation Committee.
15
<PAGE>
PERFORMANCE GRAPH
The following graph compares the cumulative total stockholder return on Nash
Finch Common Stock for the last five fiscal years with the cumulative total
return over the same period of the S & P 500 Index, the S & P SmallCap 600 Index
(in which Nash Finch is included) and a peer group of companies selected by Nash
Finch (weighted according to the peer companies' market capitalization at the
beginning of each fiscal year). The comparison assumes the investment of $100 in
Common Stock, the S & P 500 Index, the S & P SmallCap 600 Index and the peer
group at the end of fiscal 1989 and reinvestment of all dividends.
TOTAL SHAREHOLDERS RETURN
PREPARED FOR NASH FINCH CO
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
NASH FINCH CO. S& P 500 S & P SMALLCAP 600 INDEX PEER GROUP
<S> <C> <C> <C> <C>
1989 100.00 100.00 100.00 100.00
1990 71.84 96.89 76.31 93.98
1991 73.50 126.42 113.32 103.60
1992 83.15 136.05 137.16 111.14
1993 82.72 149.76 162.92 119.21
1994 80.24 151.74 155.15 91.99
</TABLE>
Source: Standard & Poor's Compustat Services, Inc.
The companies included in the peer group are Fleming Companies, Inc., Super
Food Services, Inc. and Supervalu, Inc. They were selected on the basis that,
like Nash Finch, each is predominately a full-line wholesale distributor of
grocery products having several distribution centers and with operations which
extend over a wide geographic area. The Compensation Committee has approved the
selection of these companies.
COMPLIANCE WITH FEDERAL TAX LEGISLATION
Federal tax legislation enacted in 1993 generally would preclude Nash Finch
and other public companies from taking a tax deduction for compensation over $1
million which is not "performance-based" and is paid, or otherwise taxable, to
executives named in the Summary Compensation Table and employed by Nash Finch at
the end of the applicable tax year. No named executive earned over $1 million in
1994. Similarly, no named executive is likely to earn over $1 million in 1995.
The Compensation Committee intends to monitor the executive compensation program
with respect to the present federal tax law.
16
<PAGE>
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.
Section 16(a) of the Securities Exchange Act of 1934 requires Nash Finch's
directors and executive officers and all persons who beneficially own more than
10% of the outstanding shares of Common Stock to file with the SEC reports of
initial ownership and reports of changes in ownership. Copies of such reports
must also be furnished to Nash Finch, which offers assistance to its directors
and executive officers in complying with Section 16(a), including preparing the
reports and forwarding them to the SEC for filing. During 1994, a report of a
change in ownership by Mr. Flaten's wife was filed approximately four months
late. Also, due to administrative oversight on the part of Nash Finch, the
initial report of ownership of Charles M. Seiler, an officer, was filed
approximately three months late.
To Nash Finch's knowledge, based upon a review of the copies of reports
furnished to Nash Finch and written representations, all other filing
requirements applicable to directors and executive officers were complied with
during the fiscal year ended December 31, 1994, and no other reports of actual
transactions were filed late.
PROPOSAL TO ADOPT THE
NASH FINCH 1995 DIRECTOR STOCK OPTION PLAN
INTRODUCTION
Effective as of March 24, 1995, the Board of Directors adopted the
Non-Employee Director Plan. The Non-Employee Director Plan provides for the
automatic award of nonqualified options to purchase shares of Common Stock to
members of the Board of Directors who are not also employees of Nash Finch. The
Board of Directors believes that the Non-Employee Director Plan will advance the
interests of Nash Finch and its stockholders by (i) increasing the proprietary
interests of non-employee directors in Nash Finch's long-term success and more
closely aligning the interests of such directors with the interests of Nash
Finch's stockholders, and (ii) providing an additional means by which Nash Finch
can attract and retain experienced and knowledgeable people to serve as
directors.
SUMMARY OF THE NON-EMPLOYEE DIRECTOR PLAN
The following summary of the principal features of the Non-Employee Director
Plan is qualified in its entirety by reference to the full text of the
Non-Employee Director Plan.
SHARES AVAILABLE UNDER THE NON-EMPLOYEE DIRECTOR PLAN. No more than 40,000
shares of the Common Stock may be the subject of stock options granted under the
Non-Employee Director Plan ("Options"). The shares of Common Stock issuable
under the Non-Employee Director Plan may, at the election of the Compensation
Committee, be either treasury shares or shares authorized but unissued. If there
is any change in the corporate structure or shares of Common Stock of Nash Finch
such as in connection with a merger, recapitalization, stock split, stock
dividend, or other extraordinary dividend (including a spinoff), the aggregate
number and kind of securities subject to Options under the Non-Employee Director
Plan, the number of shares issuable upon the exercise of Options and the
exercise price of Options will be appropriately adjusted to prevent dilution or
enlargement of rights of participants. If any Option terminates, expires or is
cancelled without having been exercised in full, then such unexercised shares
subject to the Option will automatically again become available for issuance
under the Non-Employee Director Plan.
ELIGIBILITY. All directors of Nash Finch who are not employees of Nash
Finch or its subsidiaries are eligible to participate in the Non-Employee
Director Plan.
17
<PAGE>
OPTION GRANTS. Annual grants of Options to purchase 500 shares of Common
Stock will be made automatically to each eligible non-employee director
immediately following each annual meeting of stockholders of Nash Finch. The
exercise price per share of each Option granted under the Non-Employee Director
Plan will be 100% of the fair market value of the underlying Common Stock on the
date the Option is granted. Payment for stock purchased upon the exercise of an
Option must be made in full in cash at the time of exercise. An Option granted
under the Non-Employee Director Plan will become exercisable in full six months
after its date of grant, and will no longer be exercisable five years from its
date of grant. If an eligible director's service as a director is terminated due
to death, disability or retirement, all outstanding Options then held by the
director will become exercisable in full and will remain exercisable for one
year. If a director's service is terminated for any reason other than death,
disability or retirement, all rights of the eligible director under the
Non-Employee Director Plan and any agreements evidencing an Option will
immediately terminate without notice of any kind and no Options then held by the
eligible director will thereafter be exercisable; provided, however, that if
such termination is due to any reason other than termination for "cause," all
outstanding Options then held by the director will remain exercisable for a
period of three months after termination of service as a director to the extent
such Options were exercisable as of such termination (but in no event after the
expiration date of any such Option).
ADMINISTRATION OF DIRECTOR PLAN. The Non-Employee Director Plan will be
administered by the Compensation Committee. The Compensation Committee, however,
will have no authority or discretion to determine eligibility for participation
in the Non-Employee Director Plan, the number of shares of Common Stock to be
subject to Options granted under the Non-Employee Director Plan, or the timing,
pricing or other terms and conditions of such Options.
AMENDMENT OF THE PLAN. The Board may amend the Non-Employee Director Plan
in such respects as is deemed advisable. No such amendment will be effective
without the approval of Nash Finch's stockholders if stockholder approval of the
amendment is required pursuant to Rule 16b-3 under the Securities Exchange Act
of 1934 or the rules of the National Association of Securities Dealers, Inc.
("NASD"). Furthermore, the Non-Employee Director Plan may not be amended more
than once every six months unless permitted by Rule 16b-3 under the Exchange
Act.
NON-TRANSFERABILITY OF AWARD. No Option granted under the Non-Employee
Director Plan may be transferred by a participant for any reason or by any
means, except by will or by the laws of descent and distribution.
TERM OF THE PLAN. The Non-Employee Director Plan will be deemed effective
as of March 24, 1995, if approved by the Company's stockholders. The
Non-Employee Director Plan will terminate on March 1, 2000.
FEDERAL INCOME TAX CONSEQUENCES
The following description of federal income tax consequences is based on
current statutes, regulations and interpretations. The description does not
include state or local income tax consequences. In addition, the description is
not intended to address specific tax consequences applicable to an individual
participant who receives an Option.
The Options granted under the Non-Employee Director Plan do not qualify as
incentive stock options within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code"). Generally, neither the
non-employee director nor the Company incurs any federal income
18
<PAGE>
tax consequences as a result of the grant of an Option. Upon exercise of an
Option, the non-employee director will recognize ordinary compensation income in
an amount equal to the difference between (i) the fair market value of the
shares purchased on the date the non-employee director is no longer subject to
liability under Section 16(b) of the Securities Exchange Act of 1934 with
respect to such shares purchased (or on the date of exercise if the non-employee
director makes an election under Section 83(b) of the Code within 30 days of
exercise), and (ii) the consideration paid for the shares. Nash Finch will
generally be entitled to a corresponding tax deduction at the time the
non-employee director realizes ordinary income.
At the time of a subsequent sale or disposition of any shares of Common
Stock obtained upon exercise of an Option, any gain or loss will be a capital
gain or loss. Such gain or loss will be a long-term capital gain or loss if the
sale or disposition occurs more than one year after the date of exercise and
short-term capital gain or loss if the sale or disposition occurs one year or
less after the date of exercise. Such a sale of option shares by a non-employee
director will have no tax consequences for Nash Finch.
AWARDS UNDER THE NON-EMPLOYEE DIRECTOR PLAN
As of the date of this Proxy Statement, no awards have been made under the
Non-Employee Director Plan. If the Non-Employee Director Plan is approved by the
stockholders at the Annual Meeting, each of the non-employee directors holding
office after the Annual Meeting will be granted an Option for 500 shares as of
the date of the Annual Meeting and, while the Non-Employee Director Plan remains
in effect, as of the date of each annual meeting of the stockholders of Nash
Finch thereafter if he or she remains a Board member on such date or dates.
BOARD OF DIRECTORS RECOMMENDATIONS
The Board of Directors recommends that the stockholders vote FOR approval
and ratification of the Non-Employee Director Plan. The affirmative vote of a
majority of the total shares represented in person or by proxy and entitled to
vote is required for approval. Unless a contrary choice is specified, proxies
solicited by the Board of Directors will be voted FOR approval of the
Non-Employee Director Plan.
INDEPENDENT AUDITORS
On February 14, 1995, the Board of Directors, upon recommendation of the
Audit Committee, approved the engagement of Ernst & Young LLP as independent
certified public accountants to audit the Nash Finch's financial statements for
the fiscal year ending December 30, 1995. The services of the accounting firm of
KPMG Peat Marwick LLP, which previously served as the Company's independent
certified public accountants, were terminated effective upon completion of the
audit for the fiscal year ended December 31, 1994. During the two most recent
fiscal years, Nash Finch had no disagreements with KPMG Peat Marwick LLP on any
matter of accounting principles or practices, financial statement disclosure or
auditing scope or procedure and KPMG Peat Marwick LLP's report on the financial
statements for the past two years contained no adverse opinion or disclaimer of
opinion and was not qualified as to audit scope or accounting principles. During
the two most recent fiscal years or any subsequent interim period prior to
engaging Ernst & Young LLP, there were no consultations with Ernst & Young LLP
regarding either the application of accounting principles to a specified
transaction, either completed or proposed, or the type of audit opinion that
might be rendered on the financial statements.
19
<PAGE>
Nash Finch does not intend to request that the stockholders approve the
selection of the independent public accountants for the fiscal year ended
December 30, 1995. Nash Finch requested and expects a representative of both
KPMG Peat Marwick LLP and Ernst & Young LLP to be present at the Annual Meeting,
to make a statement if he or she so desires and to respond to appropriate
questions.
1996 STOCKHOLDER PROPOSALS
Any proposal of a Nash Finch stockholder intended to be presented at the
Annual Meeting of Stockholders in 1996 must be received by Nash Finch at its
principal executive office not later than November 30, 1995, for inclusion in
its proxy statement and form of proxy.
MISCELLANEOUS
The Board of Directors is not aware of any other matters which may be
presented to the stockholders for formal action at the Annual Meeting. If,
however, any other matters properly come before the Annual Meeting or any
adjournment or adjournments thereof, it is the intention of the persons named on
the proxy card to vote such proxies in accordance with their best judgment on
such matters.
The cost of soliciting proxies will be borne by Nash Finch. Directors,
officers and regular employees of Nash Finch may, without compensation other
than their regular compensation, solicit proxies by mail, telephone, telegram or
personal interview. Nash Finch may reimburse brokerage firms and others for
their expense in forwarding proxy materials to the beneficial owners of Common
Stock.
All stockholders who do not expect to attend the Annual Meeting, are urged
to execute and return the enclosed proxy card promptly.
BY ORDER OF THE BOARD OF DIRECTORS
NORMAN R. SOLAND
VICE PRESIDENT, SECRETARY
AND GENERAL COUNSEL
April 3, 1995
Minneapolis, Minnesota
20
<PAGE>
NASH FINCH COMPANY
1995 DIRECTOR STOCK OPTION PLAN
1. PURPOSE OF PLAN.
The purpose of the Nash Finch Company 1995 Director Stock Option Plan (the
"Plan") is to advance the interests of Nash Finch Company (the "Company") and
its stockholders by enabling the Company to attract and retain the services of
experienced and knowledgeable directors and to increase the proprietary
interests of such directors in the Company's long-term success and progress and
their identification with the interests of the Company's stockholders.
2. DEFINITIONS.
The following terms will have the meanings set forth below, unless the
context clearly otherwise requires:
2.1 "BOARD" means the Board of Directors of the Company.
2.2 "CODE" means the Internal Revenue Code of 1986, as amended.
2.3 "COMMITTEE" means the group of individuals administering the Plan,
as provided in Section 3 of the Plan.
2.4 "COMMON STOCK" means the common stock of the Company, par value
$1.66 2/3 per share, or the number and kind of shares of stock or other
securities into which such Common Stock may be changed in accordance with
Section 4.3 of the Plan.
2.5 "DISABILITY" means the disability of an Eligible Director such as
would entitle the Eligible Director to receive disability income benefits
pursuant to the long-term disability plan of the Company then covering the
Eligible Director or, if no such plan exists or is applicable to the Eligible
Director, the permanent and total disability of the Eligible Director within the
meaning of Section 22(e)(3) of the Code.
2.6 "ELIGIBLE DIRECTORS" means all directors of the Company who are
not, as of the date of grant of an Option, full-time employees of the Company or
any subsidiary of the Company.
2.7 "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
2.8 "FAIR MARKET VALUE" means, with respect to the Common Stock, as of
any date (or, if no shares were traded or quoted on such date, as of the next
preceding date on which there was such a trade or quote), the mean between the
reported high and low sale prices of the Common Stock as reported on the NASDAQ
National Market System or any stock exchange on which the Common Stock is
listed.
2.9 "OPTION" means a right to purchase 500 shares of Common Stock
(subject to adjustment as provided in Section 4.3 of the Plan) granted to an
Eligible Director pursuant to Section 5 of the Plan that does not qualify as an
"incentive stock option" within the meaning of Section 422 of the Code.
<PAGE>
2.10 "RETIREMENT" means the retirement of an Eligible Director pursuant
to and in accordance with the normal retirement/pension plan or practice of the
Company then covering the Eligible Director.
2.11 "SECURITIES ACT" means the Securities Act of 1933, as amended.
3. PLAN ADMINISTRATION.
The Plan will be administered by a committee (the "Committee") consisting
solely of two or more members of the Board. All questions of interpretation of
the Plan will be determined by the Committee, each determination, interpretation
or other action made or taken by the Committee pursuant to the provisions of the
Plan will be conclusive and binding for all purposes and on all persons, and no
member of the Committee will be liable for any action or determination made in
good faith with respect to the Plan or any Option granted under the Plan. The
Committee, however, will have no power to determine the eligibility for
participation in the Plan, the number of shares of Common Stock to be subject to
Options, or the timing, pricing or other terms and conditions of the Options.
4. SHARES AVAILABLE FOR ISSUANCE.
4.1 MAXIMUM NUMBER OF SHARES AVAILABLE. Subject to adjustment as
provided in Section 4.3 of the Plan, the maximum number of shares of Common
Stock that will be available for issuance under the Plan will be 40,000 shares.
The shares available for issuance under the Plan may, at the election of the
Committee, be either treasury shares or shares authorized but unissued, and, if
treasury shares are used, all references in the Plan to the issuance of shares
will, for corporate law purposes, be deemed to mean the transfer of shares from
treasury.
4.2 ACCOUNTING FOR OPTIONS. Shares of Common Stock that are issued
under the Plan or that are subject to outstanding Options will be applied to
reduce the maximum number of shares of Common Stock remaining available for
issuance under the Plan. Any shares of Common Stock that are subject to an
Option that lapses, expires, or for any reason is terminated unexercised will
automatically again become available for issuance under the Plan.
4.3 ADJUSTMENTS TO SHARES AND OPTIONS. In the event of any
reorganization, merger, consolidation, recapitalization, liquidation,
reclassification, stock dividend, stock split, combination of shares, rights
offering, divestiture or extraordinary dividend (including a spin-off) or any
other change in the corporate structure or shares of the Company, the Committee
(or, if the Company is not the surviving corporation in any such transaction,
the board of directors of the surviving corporation) will make appropriate
adjustment (which determination will be conclusive) as to the number and kind of
securities available for issuance under the Plan and, in order to prevent
dilution or enlargement of the rights of Eligible Directors, the number, kind
and, where applicable, exercise price of securities subject to outstanding
Options.
5. OPTIONS.
5.1 GRANT. On an annual basis, each director of the Company who
qualifies as an Eligible Director immediately following each annual meeting of
stockholders of the Company will be granted an Option.
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5.2 EXERCISE PRICE. The per share price to be paid by an Eligible
Director upon exercise of an Option will be 100% of the Fair Market Value of one
share of Common Stock on the date of grant. The total purchase price of the
shares to be purchased upon exercise of an Option will be paid entirely in cash
(including check, bank draft or money order).
5.3 EXERCISABILITY AND DURATION. Each Option will become exercisable
in full six months following its date of grant and, subject to earlier
termination in accordance with Section 5.6 of the Plan, will expire and will no
longer be exercisable five years from its date of grant.
5.4 MANNER OF EXERCISE. An Option may be exercised by an Eligible
Director in whole or in part from time to time, subject to the conditions
contained in the Plan and in the agreement evidencing such Option, by delivery
in person, by facsimile or electronic transmission or through the mail of
written notice of exercise to the Company (Attention: Corporate Secretary) at
its principal executive office in Edina, Minnesota and by paying in full the
total exercise price for the shares of Common Stock to be purchased in
accordance with Section 5.2 of the Plan.
5.5 RIGHTS AS A STOCKHOLDER. As a holder of Options, an Eligible
Director will have no rights as a stockholder unless and until such Options are
exercised for shares of Common Stock and the Eligible Director becomes the
holder of record of such shares. Except as otherwise provided in the Plan, no
adjustment will be made for dividends or distributions with respect to Options
as to which there is a record date preceding the date the Eligible Director
becomes the holder of record of such shares.
5.6 EFFECT OF TERMINATION OF SERVICE AS DIRECTOR.
(a) TERMINATION DUE TO DEATH, DISABILITY OR RETIREMENT. In the
event an Eligible Director's service as a director of the Company is
terminated by reason of death, Disability or Retirement, all outstanding
Options then held by the Eligible Director will become immediately
exercisable in full and will remain exercisable for one year following
such termination (but in no event after the expiration date of any such
Option).
(b) TERMINATION FOR REASONS OTHER THAN DEATH, DISABILITY OR
Retirement.
(i) In the event an Eligible Director's service as a
director of the Company is terminated for any reason other than
death, Disability or Retirement, all rights of the Eligible Director
under the Plan and any agreements evidencing an Option will
immediately terminate without notice of any kind and no Options then
held by the Eligible Director will thereafter be exercisable;
provided, however, that if such termination is due to any reason
other than termination for "cause," all outstanding Options then
held by the Eligible Director will remain exercisable to the extent
exercisable as of such termination for a period of three months
after such termination (but in no event after the expiration date of
any such Option).
(ii) For purposes of this Section 5.6, "cause" will be as
defined in any agreement or policy applicable to the Eligible
Director or, if no such agreement or policy exists, will mean (i)
dishonesty, fraud, misrepresentation, embezzlement or material and
deliberate injury or attempted injury, in each case related to the
Company or any subsidiary, (ii) any unlawful or criminal activity of
a serious nature, (iii) any willful breach of duty, habitual neglect
of duty or unreasonable job
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performance, or (iv) any material breach of any service,
confidentiality or noncompete agreement entered into with the
Company.
6. DATE OF TERMINATION OF SERVICE AS A DIRECTOR.
An Eligible Director's service as a director of the Company will, for
purposes of the Plan, be deemed to have terminated on the date recorded on the
personnel or other records of the Company, as determined by the Committee based
upon such records.
7. RIGHTS OF ELIGIBLE DIRECTORS; TRANSFERABILITY OF INTERESTS.
7.1 SERVICE AS A DIRECTOR. Nothing in the Plan will interfere with or
limit in any way the right of the shareholders to remove an Eligible Director at
any time, and neither the Plan, nor the granting of an Option nor any other
action taken pursuant to the Plan, will constitute or be evidence of any
agreement or understanding, express or implied, that an Eligible Director will
be retained for any period of time or at any particular rate of compensation.
7.2 RESTRICTIONS ON TRANSFER OF INTERESTS. Except pursuant to
testamentary will or the laws of descent and distribution or as otherwise
expressly permitted by the Plan, no right or interest of any Eligible Director
in an Option prior to the exercise of Options will be assignable or
transferable, or subjected to any lien, during the lifetime of the Eligible
Director, either voluntarily or involuntarily, directly or indirectly, by
operation of law or otherwise. In the event of an Eligible Director's death,
exercise of any Options (to the extent permitted pursuant to Section 5 of the
Plan) may be made by the Eligible Director's legal representatives, heirs and
legatees.
7.3 NON-EXCLUSIVITY OF THE PLAN. Nothing contained in the Plan is
intended to modify or rescind any previously approved compensation plans or
programs of the Company or create any limitations on the power or authority of
the Board to adopt such additional or other compensation arrangements as the
Board may deem necessary or desirable.
8. SECURITIES LAW AND OTHER RESTRICTIONS.
Notwithstanding any other provision of the Plan or any agreements entered
into pursuant to the Plan, the Company will not be required to issue any shares
of Common Stock under this Plan, and an Eligible Director may not sell, assign,
transfer or otherwise dispose of shares of Common Stock issued pursuant to
Options granted under the Plan, unless (a) there is in effect with respect to
such shares a registration statement under the Securities Act and any applicable
state securities laws or an exemption from such registration under the
Securities Act and applicable state securities laws, and (b) there has been
obtained any other consent, approval or permit from any other regulatory body
which the Committee, in its sole discretion, deems necessary or advisable. The
Company may condition such issuance, sale or transfer upon the receipt of any
representations or agreements from the parties involved, and the placement of
any legends on certificates representing shares of Common Stock, as may be
deemed necessary or advisable by the Company in order to comply with such
securities law or other restrictions.
9. PLAN AMENDMENT, MODIFICATION AND TERMINATION
The Board may suspend or terminate the Plan or any portion thereof at any
time, and may amend the Plan from time to time in such respects as the Board may
deem advisable in order that
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Options under the Plan will conform to any change in applicable laws or
regulations or in any other respect the Board may deem to be in the best
interests of the Company; provided, however, that (a) no amendments to the Plan
will be effective without approval of the stockholders of the Company if
stockholder approval of the amendment is then required pursuant to Rule 16b-3
under the Exchange Act or the rules of the NASD, and (b) to the extent
prohibited by Rule 16b-3 of the Exchange Act, the Plan may not be amended more
than once every six months. No termination, suspension or amendment of the Plan
may adversely affect any outstanding Option without the consent of the affected
Eligible Director; provided, however, that this sentence will not impair the
right of the Committee to take whatever action it deems appropriate under
Section 4.3 of the Plan.
10. EFFECTIVE DATE AND DURATION OF THE PLAN
The Plan is effective as of March 24, 1995, the date it was adopted by the
Board. The Plan will terminate at midnight on March 1, 2000, and may be
terminated prior thereto by Board action, and no Option will be granted after
such termination. Options outstanding upon termination of the Plan may continue
to be exercised, or become free of restrictions, in accordance with their terms.
11. MISCELLANEOUS
11.1 GOVERNING LAW. The validity, construction, interpretation,
administration and effect of the Plan and any rules, regulations and actions
relating to the Plan will be governed by and construed exclusively in accordance
with the laws of the State of Minnesota, notwithstanding the conflicts of laws
principles of any jurisdictions.
11.2 SUCCESSORS AND ASSIGNS. The Plan will be binding upon and inure
to the benefit of the successors and permitted assigns of the Company and the
Eligible Directors.
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[LOGO] PROXY THIS PROXY IS SOLICITED ON BEHALF OF THE
BOARD OF DIRECTORS.
The undersigned hereby appoints Alfred
NASH FINCH COMPANY N. Flaten, John H. Grunewald and Robert
7600 FRANCE AVENUE SOUTH, P.O. BOX 355 F. Nash, and each of them, as Proxies,
MINNEAPOLIS, MN 55440-0355 each with the power of substitution, and
- -------------------------------------- hereby authorizes each of them to
represent and to vote, as designated
below, all the shares of common stock of
Nash Finch Company held of record by the
undersigned on March 20, 1995, at the
Annual Meeting of Stockholders to be
held on May 9, 1995 or any adjournment
thereof.
1. ELECTION OF DIRECTORS FOR all nominees listed WITHHOLD AUTHORITY to vote
below (except as for all
marked to the contrary nominees listed below / /
below) / /
(INSTRUCTION: To withhold authority to vote for any individual nominee strike
a line through the nominee's name)
Alfred N. Flaten Richard G. Lareau
Allister P. Graham Jerome O. Rodysill
2. PROPOSAL TO ADOPT THE COMPANY'S 1995 DIRECTOR STOCK OPTION PLAN.
/ / FOR / / AGAINST / / ABSTAIN
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1 AND 2 ABOVE.
(PLEASE SIGN ON REVERSE SIDE)
<PAGE>
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR PROPOSAL 2 AND TO GRANT AUTHORITY TO VOTE FOR ALL NOMINEES
NAMED IN PROPOSAL 1 ABOVE.
Please sign exactly as name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
DATED ________________, 1995
____________________________
SIGNATURE
____________________________
SIGNATURE IF HELD JOINTLY
PLEASE MARK, SIGN, DATE AND
RETURN THE PROXY CARD
PROMPTLY USING THE ENCLOSED
ENVELOPE.
