SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant X
Filed By a Party other than the Registrant
Check the appropriate box:
Preliminary Proxy Statement
X Definitive Proxy Statement
Definitive Additional Materials
Soliciting Material Pursuant to Section 240.14a-11(c)
or Section 240.14a-12
VICORP Restaurants,Inc.
________________________________________________________________
(Name of Registrant as Specified In Its Charter)
Stanley Ereckson,Jr.
________________________________________________________________
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
X $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2)
$500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3)
Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11
PROXY RULES
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____________________________________________________________________
2) Aggregate number of securities to which transaction applies:
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pursuant to Exchange Act Rule 0-11:*
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* Set forth the amount on which the filing fee is calculated and state
how it was 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.
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VICORP RESTAURANTS, INC.
400 WEST 48th AVENUE
DENVER, COLORADO 80216
_______________
PROXY STATEMENT
_______________
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 12, 1994
GENERAL INFORMATION ON THE MEETING
This Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Directors of VICORP
Restaurants, Inc. (the "Company") whose principal offices are
located at 400 West 48th Avenue, Denver, Colorado 80216,
telephone number (303) 296-2121, to be used at the Annual Meeting
of Shareholders of the Company (the "Meeting") to be held on
Tuesday, April 12, 1994 at 11:00 A.M. local time, at the
Company's offices at 400 West 48th Avenue, Denver, Colorado, and
at any adjournment thereof.
This Proxy Statement, the form of Proxy and the 1993 Annual
Report to Shareholders are first being sent to shareholders on
approximately March 3, 1994.
SHAREHOLDER PROPOSALS
Any shareholder proposal to be considered for presentation
at the 1995 Annual Meeting of Shareholders must be received by
the Company at its executive offices on or before November 3,
1994 to be considered for inclusion in the Company's proxy
materials under the rules of the Securities and Exchange
Commission.
REVOCABILITY OF PROXY
Any shareholder giving a proxy has the power to revoke it at
any time prior to the voting of the shares represented by the
proxy, by either (1) filing with the Secretary of the Company at
400 West 48th Avenue, Denver, Colorado 80216, an instrument
revoking the proxy or a duly executed proxy bearing a later date,
or (2) attending the meeting and, after notifying the Secretary
of the Company, voting the shares covered by the proxy in person.
Officers and other employees of the Company, for no additional
compensation, may solicit proxies by telephone or personal
interview as well as by mail. The cost of soliciting proxies will
be borne entirely by the Company.
Only shareholders of record at the close of business on the
record date, February 23, 1994, will be entitled to notice of and
to vote at the Meeting. There were outstanding on the record date
9,756,563 shares of the Company's $.05 par value Common Stock
("Stock").
Each share of Stock is entitled to one vote on each matter
to come before the Meeting. In the election of Directors,
cumulative voting is not allowed. Shares represented by all
valid proxies will be voted in accordance with the instructions
contained in the proxies. In the absence of instructions, shares
represented by valid proxies will be voted in accordance with the
best judgment of the persons named in the solicited proxy.
Shares of the Company representing one-third of the votes
entitled to be cast by all outstanding shares of Stock will
constitute a quorum for the transaction of business at the
Meeting. The affirmative vote of the holders of shares of Stock
representing a majority of the votes represented at the Meeting
will be sufficient for approval of the matters to come before the
Meeting. Abstentions and broker non-votes are counted for purposes
of determining the presence or absence of a quorum. Broker
non-votes are not counted for purposes of determining whether a
proposal has been approved. Since the affirmative vote of the
holders of shares of Stock representing a majority of the
votes represented at the meeting is required for approval of the
matters to come before the meeting, abstentions will have the
effect of a negative vote.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
STOCK
The following table sets forth information as of February 21, 1994
with respect to the beneficial ownership of VICORP's Stock by all
persons known by the Company to be the beneficial owners of 5% or more
of the outstanding shares, each director of the Company, each of the
executive officers named in the Summary Compensation Table (see
Compensation of Directors and Executive Officers) and all directors
and executive officers of the Company as a group.
<TABLE>
<CAPTION>
Name and Amount and
Address of Nature of
Title of Beneficial Beneficial Percent
Class Owner Ownership of Class
----------- ------------- ------------- ----------
<S> <C> <C> <C>
Stock First Manhattan Co. 1,063,318<F1> 10.90
(par value $.05 437 Madison Avenue
per share) New York, NY 10022
Sound Shore Management 1,023,500<F2> 10.49
8 Sound Shore Drive
Greenwich, CT 06836
Heine Securities 499,300<F3> 5.12
Corporation
51 J.F.K. Parkway
Short Hills, NJ 07078
Carole Lewis Anderson 10,000<F4> *<F5>
3616 Reservoir Road NW
Washington, DC 20007
Robert S. Benson 211,330<F4> 2.15
400 West 48th Avenue
Denver, CO 80216
Bruce B. Brundage 21,000<F4> *<F5>
5290 DTC Parkway
Suite 160
Englewood, CO 80111
James F. Caruso 30,100<F4> *<F5>
400 West 48th Avenue
Denver, CO 80216
Charles R. Frederickson 219,658<F4> 2.22
400 West 48th Avenue
Denver, CO 80216
John C. Hoyt 51,868<F4> *<F5>
500 East Sixth Street
Bartlesville, OK 74003
Emerson B. Kendall 10,000 *<F5>
2490 Glen Eagle Drive
Olympia Fields, IL 60461
Dennis L. Kuper 38,376<F4> *<F5>
400 West 48th Avenue
Denver, CO 80216
Robert T. Marto 14,000<F4> *<F5>
Harrison Executive Park
777 Westchester Avenue
White Plains, NY 10604
Dudley C. Mecum 13,500<F4> *<F5>
540 Madison Avenue
New York, NY 10022
Dennis B. Robertson 18,000<F4> *<F5>
520 Executive Drive
Willowbrook, IL 60521
Arthur Zankel 96,400<F4><F6> *<F5>
437 Madison Avenue
New York, NY 10022
All directors 734,232<F4> 7.25
and executive officers
as a group (12 persons
including those
named above)
<FN>
<F1> Of the 1,063,318 shares beneficially owned, the shareholder
has sole voting power over 259,000 shares, shared voting power
over 776,643 shares, sole dispositive power over 259,000 shares
and shared dispositive power over 804,318 shares. Arthur Zankel,
a director of the Company, is a Co-Managing Partner of
First Manhattan Co.
<F2> Of the 1,023,500 shares beneficially owned, the shareholder has
sole voting and dispositive power over all the shares.
<F3> Of the 499,300 shares beneficially owned, the shareholder has sole
voting and dispositive power over all the shares.
<F4> Includes 10,000; 50,000; 16,000; 30,000; 158,779; 14,000; 30,000;
14,000; 12,000; 16,000 and 16,000 shares which Ms. Anderson,
Messrs. Benson, Brundage, Caruso, Frederickson, Hoyt, Kuper, Marto,
Mecum, Robertson and Zankel, respectively, have the right to purchase
under options that are presently exercisable.
<F5> * Percent of class is less than 1%
<F6> Includes 79,600 shares owned directly by Mr. Zankel, 16,000 shares
which he has the right to purchase under options that are presently
exercisable and 800 shares held by or in trust for a family member.
</TABLE>
VICORP is unaware of any arrangement which would at a
subsequent date result in a change in the control of the Company.
ELECTION OF DIRECTORS
Directors are to be elected to hold office until the next
Annual Meeting of Shareholders and until their successors shall
be elected and shall qualify. Each of the persons nominated is
currently a member of the Board of Directors.
<TABLE>
<CAPTION>
NOMINEES FOR ELECTION AT THE ANNUAL MEETING
Served as
a Director
Name and Age Position Since
____________ ________ __________
<S> <C> <C>
Carole Lewis Anderson, 49 Director of the Company April 1991
Robert S. Benson, 51 Director, President and October 1982
Chief Operating Officer
of the Company
Bruce B. Brundage, 58 Director of the Company August 1988
Charles R. Frederickson, 56 Chairman of the Board and June 1968
Chief Executive Officer
of the Company
John C. Hoyt, 66 Director of the Company October 1982
Robert T. Marto, 48 Director of the Company August 1989
Dudley C. Mecum, 59 Director of the Company December 1989
Dennis B. Robertson, 56 Director of the Company August 1988
Arthur Zankel, 61 Director of the Company October 1988
</TABLE>
Carole Lewis Anderson, a director since April 1991, is
currently the President of MASDUN Capital Advisors, a private
investment banking company which engages in corporate and real estate
finance. From June 1988 to November 1990, Ms. Anderson was President
of MNC Investment Bank. MNC Investment Bank, a subsidiary of Maryland
National Bank, provided corporate finance, real estate finance, and
financial advisory services to public and private companies.
Robert S. Benson, a director since October 1982, was
appointed President and Chief Operating Officer in October 1987.
Mr. Benson is also an individual general partner in Boettcher
Venture Capital Partners, a publicly held partnership.
Bruce B. Brundage became a director of the Company in August
1988. Since 1973, Mr. Brundage has been the President of
Brundage & Company, a Denver-based company specializing in the
private placement of long-term financing and the negotiation,
appraisal and arrangement of mergers and acquisitions. Mr. Brundage
is a director of Black Hills Corporation.
Charles R. Frederickson, a director of the Company since
1968, was appointed to the position of Chairman of the Board in
November 1986.
John C. Hoyt, a director since October 1982, has for more
than the past five years been an officer, director and controlling
shareholder of Midwest Pancake Houses, Inc., which is a Village Inn
franchisee. See Certain Transactions.
Robert T. Marto, a director since August 1989, is currently
President and Chief Executive Officer of White River Corporation.
He served as Executive Vice President and Chief Financial Officer
of Fund American Enterprises Holdings, Inc., and as President of
its wholly owned subsidiary Fund American Enterprises, Inc. from
1990 to December 1993. Mr. Marto served as Vice President and
Chief Financial Officer of Fund American Enterprises Holdings,
Inc. from 1989 to 1990 and was Vice President and Treasurer from
1985 to 1989. Mr. Marto is a director of White River Corporation
and Zurich Holdings.
Dudley C. Mecum became a director in December 1989. Since
August 1989, he has been a partner with G.L. Ohrstrom & Company,
which acquires and manages companies for investors. From
December 1987 to August 1989, Mr. Mecum was the Chairman of Mecum
Associates, Inc., a private consulting firm. Mr. Mecum is also a
director of The Travelers, Inc., Lyondell Petrochemical Co.,
Dyncorp, Fingerhut and Roper Industries, Inc.
Dennis B. Robertson became a director of the Company in
August 1988. Mr. Robertson is currently the Chairman of Fishy
Things, Inc., which operates seafood restaurants. Prior to his
appointment as Chairman, he was the President of Fishy Things,
Inc., a position he held since 1985.
Arthur Zankel became a director of the Company in October
1988. He is currently the Co-Managing Partner of First Manhattan
Co., a position which he has held since 1979. First Manhattan
Co. is a money management and institutional research firm.
Mr. Zankel is also a director of The Travelers, Inc. and Fund
American Enterprises, Inc.
The Board of Directors, while not having a nominating
committee, does have standing Audit and Compensation Committees.
The Audit Committee met three times in fiscal 1993, and consisted
of Ms. Anderson and Messrs. Brundage, Marto and Zankel for the
period October 25, 1992 through June 9, 1993 and Ms. Anderson and
Messrs. Brundage, Hoyt, Marto, Mecum, Robertson, and Zankel for
the period June 10, 1993 through the end of the fiscal year. The
function of the Committee is to recommend to the Board of
Directors the appointment of the Company's independent auditors,
review the fee arrangements and scope of the annual audit, and
consider the comments of the independent and internal auditors
with respect to internal controls.
The Compensation Committee, which also acts as the Regular
Stock Option Committee for the Company's 1982 Incentive and
Non-Qualified Stock Option Plan, was composed of Messrs. Benson,
Hoyt, Mecum and Robertson for the period October 25, 1992 through
December 30, 1992; Messrs. Mecum and Robertson for the period
December 31, 1992 through June 9, 1993; and Ms. Anderson and
Messrs. Brundage, Marto, Mecum, Robertson and Zankel for the
period June 10, 1993 through the end of the fiscal year. That
committee met four times during the last fiscal year. The
Committee recommends to the Board of Directors officers' salaries,
administers executive compensation plans, grants options and
approves bonuses for the Company's employees participating in the
executive incentive plan.
During fiscal 1993, the Board of Directors met five times.
Each of the Directors attended at least 75% of the meetings of
the Board of Directors and the committees of which that person
was a member.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table discloses compensation received by the
Company's Chief Executive Officer and named executive officers
for the three fiscal years ended October 31, 1993.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
__________________________
Annual compensation
___________________
Other All
annual other
compen- compen-
Name and principal Salary Bonus sation sation
position Year ($) ($) ($) ($)
__________________ _____ ______ ______ ________ _________
<S> <C> <C> <C> <C> <C>
Charles R. Frederickson 1993 274,423 4,577<F1>
Chief Executive 1992 267,692 125,000 4,444<F2>
Officer 1991 250,000
Robert S. Benson 1993 274,423 4,577<F1>
President 1992 267,692 105,000 23,194<F2>
1991 250,000 80,000
Emerson B.Kendall 1993 284,000 4,577<F1>
Executive Vice 1992 258,846 104,000 4,444<F2>
President 1991 250,000
James F. Caruso 1993 195,385 84,000
Executive Vice 1992 156,539 116,480
President 1991 111,346 44,730
Dennis L. Kuper 1993 132,654 16,156 2,982<F1>
Executive Vice 1992 129,538 31,286 8,868<F2>
President 1991 126,000 3,000
<FN>
<F1> Represents the Company's matching contribution for the stated
individuals to its 401(K) Plan during fiscal 1993.
<F2> The amounts shown represent $4,444 on behalf of each of
Messrs. Frederickson, Benson and Kendall and $2,523 on behalf of
Mr. Kuper, which are the Company's matching contributions for the
stated individuals to its 401(K) Plan, and $18,750 and $6,345 in
cash paid to Messrs. Benson and Kuper under the Company's 1989
Outstanding Stock Purchase Plan.
</TABLE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
There were no grants to the executive officers of the Company
during fiscal 1993.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL
YEAR-END OPTION/SAR VALUES
The following table provides information on option/SAR
exercises in fiscal 1993 by the named executive officers and the
value of such officers' unexercised options/SARs at October 31,
1993.
<TABLE>
<CAPTION>
Value of
Number of unexercised in-
unexercised the-money
options/SARs options/SARs
at fiscal at fiscal
year end year end
(#) ($)
___________ _______________
Shares Value
acquired on realized Exercisable/ Exercisable/
Name exercise ($) unexercisable unexercisable
(#)
______ ___________ ________ _____________ _____________
<S> <C> <C> <C> <C>
Charles R. Frederickson 60,000 948,750 158,779 1,765,174
Robert S. Benson 100,000 1,812,500 50,000 187,500
Emerson B. Kendall 39,500 725,813 50,500 422,563
James F. Caruso 30,000/20,000 125,000/90,000
Dennis L. Kuper 30,000 396,250
</TABLE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee for fiscal 1993
were Robert S. Benson, John C. Hoyt, Dudley C. Mecum and Dennis
B. Robertson for the period October 25, 1992 through December 30,
1992; Messrs. Mecum and Robertson for the period December 31,
1992 through June 9, 1993; and Ms. Anderson and Messrs. Brundage,
Marto, Mecum, Robertson and Zankel for the period June 10, 1993
through the end of the fiscal year. Mr. Benson is the Company's
President and Chief Operating Officer and Mr. Hoyt is a Village Inn
franchisee. See Certain Transactions. Mr. Benson did not
participate in any discussions which related to his compensation.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE-OF-
CONTROL ARRANGEMENTS
In December 1989, Mr. Kendall entered into a five-year
employment agreement which was to have covered fiscal years 1990
through 1994. Under that arrangement, Mr. Kendall received a
base salary for fiscal 1993 of $260,000. Mr. Kendall was also
entitled to receive an annual bonus not to exceed 60% of his base
salary based upon performance criteria established annually.
On October 28, 1993, Mr. Kendall's employment with the Company
was terminated. As a result, the employment agreement has been
cancelled and a lump sum payment of $390,000 was paid in December
1993 as required by that agreement.
Certain employees of the Company, including Messrs. Caruso
and Kuper have entered into employment severance agreements with
the Company. The term of those agreements expires December 31 of
each year; however, they are extended automatically on January 1
of each year, unless ninety days' notice of non-renewal is given
by either party. The severance agreement provides that, in the
event a covered employee is terminated within one year following
a defined change of control in the Company, the terminated
employee will be entitled to certain payments. If the employee's
termination is by reason of death, disability, retirement or is a
voluntary action on the part of the employee, the Company is
required to pay the employee all earned but unpaid compensation
to the date of termination. If the employee is terminated for
cause, as defined in the agreement, the Company is required to
pay the employee his base salary through the date of termination.
If the employee's termination is for reasons other than those
specified above, the employee is entitled to all compensation
earned and unpaid as of the date of termination; a lump sum cash
payment equal to one and one-half times the employee's annual
base salary; one year's life, health, hospitalization, dental and
disability benefits consistent with those provided by the Company
prior to termination; and the right to immediately exercise any
granted stock options.
In April 1989, Messrs. Benson and Frederickson entered into
employment severance agreements with the Company. The terms of
those agreements are substantially the same as described above
for other Company employees except (i) if termination is for
reasons other than cause, disability, retirement or by the
voluntary action of the employee, the lump sum cash payment shall
be equal to two and three-quarters times that person's annual base
salary plus the amount equal to the bonus compensation which that
individual was entitled to during the most recent fiscal year in which
he earned a bonus; and (ii) if the terminated employee becomes
employed within one year after termination, that employee shall repay
to the Company any cash compensation actually received by him as a
result of such employment during the one-year period up to a
specified amount.
REPORT OF THE COMPENSATION COMMITTEE
Under rules established by the Securities and Exchange Commission
("SEC"), the Company is required to provide certain data and
information in regard to the compensation and benefits provided
to the Company's Chairman and Chief Executive Officer and the
four other most highly compensated executive officers. In fulfillment
of this requirement, the Compensation Committee, at the direction
of the Board of Directors, has prepared the following report.
COMPENSATION PHILOSOPHY:
This report reflects the Company's compensation philosophy as
endorsed by the Board of Directors and the Committee and the
resulting actions taken for fiscal 1993.
The Committee either approves or recommends to the Board of
Directors salary levels and incentive awards for executive
officers of the Company. With regard to compensation actions
affecting Messrs. Frederickson and Benson, all of the non-employee
members of the Board of Directors acted as the approving body.
Essentially, the executive compensation program of the Company
has been designed to:
- Pay salaries that are competitive with those of other bonus-
paying companies of comparable size in similar industries
and labor markets, thus allowing the Company to compete for
and retain talented executives who are important to the
Company's long-term success;
- Pay executives equitably according to the position held and
its value to the Company;
- Determine salary increases on a pay-for-performance merit
basis;
- Include salary, annual cash incentive opportunities, and long-
term incentive opportunities in the form of stock options and
benefits.
As an executive's level of responsibility increases, a greater
portion of his or her potential total compensation opportunity is
based on performance incentives and less on salary and employee
benefits.
SALARIES:
Effective December 7, 1992, the non-employee members of the Board
of Directors, acting on the recommendation of the Compensation
Committee, increased the base salaries paid to Messrs. Frederickson
and Benson, the Company's Chairman and Chief Executive Officer and
President and Chief Operating Officer, respectively. The decision to
increase the base salaries was made after considering recommendations
from an independent compensation consultant, review of the information
contained in the 1992 Chain Restaurant Compensation Association Survey
(which surveys compensation of executives in comparable restaurant
companies), and the competitiveness of the entire compensation
package.
The Compensation Committee granted salary increases effective
December 7, 1992 to the named executives, except Kendall, after a
review of the data discussed above as it related to their respective
positions.
Mr. Kendall's salary was governed by the terms of his employment
contract. He was not eligible for any increase in fiscal 1993.
BONUS AWARDS FOR 1993:
Executive incentive plans for fiscal 1993 were established at the
beginning of the year. Under the plan applicable to Messrs.
Frederickson and Benson, each was eligible for a target bonus
equal to 45% of his base salary, with the ability to earn a
bonus of between 0% and 200% of the target. The bonus awarded, if
any, was to be based upon the judgment of the non-employee
members of the Board of Directors with the understanding that the
Company's performance vis-a-vis the 1993 profit plan would be the
central factor considered. The non-employee members of the Board
of Directors, after comparing the Company's performance against
the 1993 profit plan, awarded no bonus to either Messrs.
Frederickson or Benson.
The target bonus for Messrs. Caruso and Kendall was 40% and for
Mr. Kuper was 35% of their respective base salaries. Each had
the ability to earn a bonus of between 0% and 200% of the target,
based upon a predetermined scale which decreases or increases the
bonus earned in relation to the extent unit and individual
objectives applicable to the individual were partially achieved
or exceeded.
The plans for Messrs. Kendall and Caruso provided that any bonus
earned was based solely upon the performance of the division for
which each was responsible. The 1993 unit performance objectives
for the Company's operating divisions were essentially: 40% was
earned if specified return on asset levels were met, 40% was
earned if the applicable division met its profit plan and 20% was
based upon non-numerical criteria.
The plan as it related to Mr. Kuper had unit and individual
performance objectives. For any bonus to fund, the unit performance
objective had to be attained; only then would the individual
objectives be evaluated to determine if additional bonus was earned.
The unit performance objective (which could account for up to 50% of
the bonus) was based: 53% on the performance of the Bakers Square
Division, 27% on the performance of the Village Inn Division, and 20%
was based upon non-numerical criteria. To the extent unit performance
objectives were partially achieved or exceeded, the bonus earned on
that component could decrease or increase based upon a predetermined
scale.
The individual performance objectives are established annually by
the executive's superior, are unique to that individual, are
closely aligned to his or her primary area of responsibility and
are not necessarily tied to objective measurement standards. As
with the unit performance objectives, to the extent individual
performance objectives were partially achieved or are exceeded,
the bonus earned on that component could decrease or increase
based upon a predetermined scale. In no event, however, can the
individual performance component exceed on a percentage basis the
unit performance component.
The Compensation Committee in establishing the criteria for
awarding bonuses attempted to set bonus levels which were consistent
with other similar restaurant companies, tie the criteria to the
specific business unit over which the executive had responsibility,
challenge the individual to perform in accordance with his or her
own goals and be responsive to the interest of the shareholders
(the return on assets component). For those not responsible for
a specific profit center, the Compensation Committee felt that
a division of the incentive based upon the size of the Company's
operating divisions was appropriate. While other measures of
performance could have been used, given the divisional nature of
the Company, the Committee took the position that return on assets was
the best measure.
1993 STOCK AWARDS:
No stock options were granted to any of the named executive
officers during fiscal 1993. The decision not to grant additional
options was made after the Committee considered the amount and terms
of the options currently held by each of the named executives. It was
the position of the Committee that the options currently granted were
comparable to those offered by similar restaurant companies and were
sufficient to create a direct link between the long-term interests of
the executives and the Company's shareholders.
COMPENSATION COMMITTEE MEMBERS:
This report is submitted by the members of the Compensation
Committee of the Board of Directors:
Dennis B. Robertson, Chairman
Carole Lewis Anderson
Bruce B. Brundage
Robert T. Marto
Dudley C. Mecum
Arthur Zankel
DIRECTORS' COMPENSATION
Non-employee directors are compensated for their services at
the rate of $2,000 per fiscal quarter, plus $1,000 per day for
services rendered, and reimbursement of actual expenses incurred.
Each non-employee director is also granted options to purchase
shares of the Company's Stock pursuant to the terms of its 1983
Non-Qualified Stock Option Plan ("1983 Plan"). The 1983 Plan,
which is mandatory in its operation, provides that each non-
employee director when first elected to the Board is granted an
option to purchase 10,000 shares of the Company's Stock, which
vest 4,000, 4,000, and 2,000 shares over the ensuing three years.
Upon a director's election for the fourth consecutive annual term
and each year thereafter, the director is granted an additional
2,000 shares. All options granted under the 1983 Plan are at
100% of the fair market value of the Company's Common Stock on
the date of grant.
PERFORMANCE GRAPH
The following performance graph reflects percentage change
in the Company's cumulative total shareholder return on common
stock as compared with the cumulative total return of the Dow
Jones Equity Market Index and the Dow Jones Entertainment &
Leisure - Restaurant Index.
<TABLE>
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
<CAPTION>
Measurement Period VICORP Restaurants,Inc. Dow Jones Restaurant Dow Jones Equity
(Fiscal Year Covered) Index Market Index
_____________________ _______________________ ____________________ ________________
<S> <C> <C> <C>
Measurement Pt-10/30/88 $100 $100 $100
FYE 10/29/1989 $124 $133 $124
FYE 10/28/1990 $118 $118 $115
FYE 10/27/1991 $178 $160 $153
FYE 10/25/1992 $187 $203 $171
FYE 10/31/1993 $175 $262 $199
</TABLE>
CERTAIN TRANSACTIONS
John C. Hoyt, a director of the Company, and members of his
family are the principal shareholders of Midwest Pancake Houses,Inc.
("MPH"). MPH has been a franchisee of the Company since 1970 and
currently operates seven Village Inn restaurants in Oklahoma. MPH
paid an initial franchise fee of $1,000 each for the operating units
and pays franchise service fees equal to 1.5% of gross sales at each
of those locations. Total franchise service fees paid by MPH in
fiscal 1993 were $118,692. MPH additionally was indebted to the
Company on its open account. The largest aggregate amount outstanding
on that open account at any time during fiscal 1993 was $19,280. As
of February 20, 1994, MPH's open account was current.
MPH is also the managing partner for a franchised Village Inn
Restaurant located in New Mexico. In fiscal 1993 the franchisee,
3155 Associates Limited Partnership ("3155"), paid to the Company
a franchise fee of $10,000 for the restaurant and pays franchise
service fees equal to 4% of gross sales at that location. Total
franchise service fees paid by 3155 in fiscal 1993 were $24,046.
It was also indebted to the Company on its open account. The largest
aggregate amount outstanding on that open account at any time during
fiscal 1993 was $42,723. As of February 20, 1994, 3155's open account
was current.
RATIFICATION OF CERTAIN TRANSACTIONS
The transactions described in the foregoing discussion have
been approved or ratified by the unanimous vote of those directors
having no interest in those transactions. The Company believes that
the terms of those transactions are no less favorable to the Company
than those that could have been obtained from independent third
parties.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Based solely on a review of the written representation of
the Company's directors and executive officers and copies of the
reports they have filed with the Securities and Exchange
Commission, the Company believes that all Section 16(a) filing
requirements applicable to its executive officers, directors and
greater than ten percent (10%) beneficial owners were complied
with.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen & Co. served as the Company's independent
accountants for the year ended October 31, 1993. The Board of
Directors has selected Arthur Andersen & Co. to serve as the
Company's independent accountants for fiscal 1994.
Representatives of Arthur Andersen & Co. will be present at
the Meeting, will be given an opportunity to make a statement if
they desire to do so and are expected to be available to respond
to appropriate questions from shareholders.
OTHER MATTERS
The Company knows of no other matters to be brought before
the Meeting; if other matters properly come before the Meeting,
it is the intention of the persons named in the solicited proxy
to vote such proxy in accordance with their judgment.
ANNUAL REPORTS AND FINANCIAL INFORMATION
A copy of the Company's Annual Report to Shareholders for
the fiscal year ended October 31, 1993 is being mailed with this
Proxy Statement to each shareholder of record as of February 23,
1994.
THE COMPANY WILL FURNISH WITHOUT CHARGE A COPY OF THE
COMPANY'S ANNUAL REPORT ON FORM 10-K FILED WITH THE UNITED STATES
SECURITIES AND EXCHANGE COMMISSION TO ANY PERSON REQUESTING A
COPY IN WRITING AND STATING THAT HE/SHE WAS THE BENEFICIAL OWNER
OF SHARES OF STOCK OF THE COMPANY ON FEBRUARY 23, 1994. REQUESTS
AND INQUIRIES SHOULD BE ADDRESSED TO:
Peter F. Doane, Vice President
VICORP Restaurants, Inc.
400 West 48th Avenue
Denver, Colorado 80216
Neither the Company's Annual Report to Shareholders nor the
Form 10-K is to be regarded as proxy soliciting material or as a
communication by means of which a solicitation is to be made.
By Order of the Board of Directors
Stanley Ereckson, Jr.
Secretary
Dated: March 3, 1994.
VICORP RESTAURANTS, INC.
PROXY SOLICITED ON BEHALF OF BOARD OF DIRECTORS
The undersigned hereby appoints Charles R. Frederickson, Robert
S. Benson, or either of them, with full power of substitution,
proxies to vote at the Annual Meeting of Shareholders of VICORP
Restaurants, Inc. (the "Company") to be held on April 12, 1994 at
11:00 a.m., local time, and at any adjournment or adjournments
thereof, hereby revoking any proxies heretofore given, to vote all
shares of common stock of the Company held or owned by the under-
signed as directed below, and in their discretion upon such other
matters as may come before the meeting.
<TABLE>
X Please mark your votes as in this example.
<CAPTION>
FOR WITHHELD FOR AGAINST WITHHELD
<S> <C> <C> <S> <C> <C> <C>
1. Election of Directors 2. Approval of Independent Accountants
Nominees: Carole Lewis Anderson, Robert S.
Benson, Bruce B. Brundage, Charles
R. Frederickson, John C. Hoyt,
Robert T. Marto, Dudley C. Mecum,
Dennis B. Robertson, Arthur Zankel
For, except vote withheld from the following nominee(s):
________________________________________________________
SIGNATURE(S)______________________________________________DATE______________
NOTE: Please sign name exactly as it appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee or guardian, please
give full title as such.
</TABLE>
