SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted
by Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
TOFUTTI BRANDS INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(1)(2)
or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
Common Stock $.01 par value
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
TOFUTTI BRANDS INC.
50 Jackson Drive
Cranford, New Jersey 07016
Telephone: (908) 272-2400
April 23, 1999
To Our Shareholders:
On behalf of the Board of Directors, I cordially invite you to attend the
1999 Annual Meeting of the Shareholders of Tofutti Brands Inc. The Annual
Meeting will be held at 10:00 a.m. on Thursday, May 27, 1999, at the Holiday Inn
Select, 36 Valley Road, Clark, New Jersey. The Holiday Inn Select is located on
the circle off exit 135 of the Garden State Parkway (telephone no.
(732)574-0100).
We are gratified by your interest in Tofutti Brands and are pleased that
you are part of our family of shareholders. We hope that you will be able to
attend the meeting.
The matters expected to be acted upon at the meeting are described in the
attached Proxy Statement. During the meeting, shareholders who are present at
the meeting will have the opportunity to ask questions.
It is important that your views be represented whether or not you are able
to be present at the Annual Meeting. Please sign and date the enclosed proxy
card and promptly return it to us in the postpaid envelope.
Sincerely,
/s/David Mintz
David Mintz
Chairman
and Chief Executive Officer
<PAGE>
TOFUTTI BRANDS INC.
---------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MAY 27, 1999
---------------------
Cranford, New Jersey
April 23, 1999
The Annual Meeting of Shareholders of Tofutti Brands Inc. will be held at
the Holiday Inn Select, 36 Valley Road, Clark, New Jersey, on Thursday, May 27,
1999 at 10:00 a.m., for the following purposes:
1. To elect five directors for the ensuing year;
2. To ratify the appointment of Wiss & Company, LLP to examine the
Company's financial statements for 1999; and
3. To act upon any other matters that may properly be brought before the
meeting and any adjournment thereof.
Shareholders of record at the close of business on April 16, 1999 will be
entitled to notice of and to vote at the meeting.
By order of the Board of Directors,
/s/Steven Kass
Steven Kass
Secretary
PLEASE SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY
IN THE ENVELOPE PROVIDED FOR THAT PURPOSE.
<PAGE>
TOFUTTI BRANDS INC.
50 Jackson Drive, Cranford, New Jersey 07016
--------------------------
PROXY STATEMENT
--------------------------
ANNUAL MEETING OF SHAREHOLDERS
May 27, 1999
This Proxy Statement is furnished to shareholders of Tofutti Brands Inc.
(the "Company") in connection with the Annual Meeting of Shareholders (the
"Annual Meeting") to be held at 10:00 a.m. on Thursday, May 27, 1999 at the
Holiday Inn Select, 36 Valley Road, Clark, New Jersey, and at any adjournment
thereof. The Tofutti Brands Inc. Board of Directors is soliciting proxies to be
voted at the Annual Meeting.
This Proxy Statement and Notice of Annual Meeting, the proxy card and
Company's Annual Report to Shareholders are expected to be mailed to
shareholders beginning April 23, 1999.
Proxy Procedure
Only shareholders of record at the close of business on April 16, 1999 are
entitled to vote in person or by proxy at the Annual Meeting.
The Company's Board of Directors solicits proxies so that each shareholder
has the opportunity to vote on the proposals to be considered at the Annual
Meeting. When a proxy card is returned properly signed and dated, the shares
represented thereby will be voted in accordance with the instructions on the
proxy card. If a shareholder does not return a signed proxy card or does not
attend the Annual Meeting and vote in person, his or her shares will not be
voted. Abstentions and "broker non-votes" are not counted in determining
outcomes of matters being acted upon. They are counted only for determining a
meeting quorum. If a shareholder attends the Annual Meeting, he or she may vote
by ballot.
Shareholders are urged to mark the boxes on the proxy card to indicate how
their shares are to be voted. If a shareholder returns a signed proxy card but
does not mark the boxes, the shares represented by that proxy card will be voted
as recommended by the Board of Directors. The proxy card gives the individuals
named as Proxies discretionary authority to vote the shares represented on any
other matter that is properly presented for action at the Annual Meeting. A
shareholder may revoke his or her proxy at any time before it is voted by: (i)
giving notice in writing to the Secretary of the Company, (ii) granting a
subsequent proxy; or (iii) appearing in person and voting at the Annual Meeting.
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<PAGE>
Cost of Solicitation
The cost of soliciting proxies will be borne by the Company. Proxies may be
solicited by directors, officers or regular employees of the Company in person
or by telephone or other means. The Company will reimburse brokerage houses and
other custodians, nominees and fiduciaries for their expenses in accordance with
the regulations of the Securities and Exchange Commission concerning the sending
of proxies and proxy material to the beneficial owners of stock.
Voting
The outstanding voting stock of the Company as of April 16, 1999 consisted
of 6,183,567 shares of Common Stock. The presence of a majority of the
outstanding shares of the Common Stock, represented in person or by proxy at the
meeting, will constitute a quorum. If a nominee for director receives a
plurality of the votes cast by the holders of the outstanding shares of Common
Stock entitled to vote at the Annual Meeting, he will be elected. An affirmative
majority of the votes cast is required to ratify the appointment of auditors.
Abstentions and broker non-votes are not counted in determining the number of
shares voted for or against any nominee for director or any proposal.
Management has received indications from the Company's Chief Executive
Officer, the beneficial owner of approximately 53.2% of the outstanding shares
of Common Stock, that he presently intends to vote in favor of all of the
resolutions on the agenda for the Annual Meeting. The Company believes that its
Chief Executive Officer owns a sufficient number of shares to elect the five
nominees as directors and to ratify the appointment of Wiss & Company, LLP as
the Company's independent auditors.
The Company's Annual Report for the fifty-two week period ended December
26, 1998, which report is not part of this proxy solicitation, is being mailed
to shareholders with this proxy solicitation. It is anticipated that this Proxy
Statement and the accompanying form of proxy will first be mailed to
shareholders on or about April 23, 1999.
Proxy Statement Proposals
Each year at the Annual Meeting, the Board of Directors submits to
shareholders its nominees for election as directors. Shareholders also vote to
ratify or reject the auditors selected by the Board of Directors. In addition,
the Board of Directors may submit other matters to the shareholders for action
at the Annual Meeting.
Shareholders of the Company also may submit proposals for inclusion in the
proxy material. These proposals must meet the shareholder eligibility and other
requirements of the Securities and Exchange Commission. In order to be included
in the Company's year 2000 proxy material, a shareholder's proposal must be
received not later than January 3, 2000 at the Company's headquarters, 50
Jackson Drive, Cranford, New Jersey 07016, Attention: Secretary.
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<PAGE>
ITEM 1.
ELECTION OF DIRECTORS
The Board of Directors (the "Board") has proposed that five directors be
elected at the Annual Meeting to serve until the next Annual Meeting of
Shareholders and the due election and qualification of their successors. The
proxies will be voted, unless otherwise specified, in favor of the election as
directors of the five persons hereinafter named. Should any of the nominees not
be available for election, the proxies will be voted for a substitute nominee
designated by the Board. It is not expected that any of the nominees will be
unavailable. Four of the nominees are now members of the Board, with terms
expiring as of the date of this Annual Meeting.
Background information with respect to the five nominees for director
appears below. See "Security Ownership of Certain Beneficial Owners and
Management" for information regarding such persons' holdings of Common Stock.
<TABLE>
<CAPTION>
Director
Nominee Principal Occupation Age Since
- ------- -------------------- --- -----
<S> <C> <C> <C>
David Mintz Chairman of the Board of Directors 67 1981
and Chief Executive Officer
Bernard Koster Counsel, Litwin and Holsinger 64 1993
Reuben Rapoport Director of Product Development 69 1983
and Director
Franklyn Snitow Partner, Snitow & Cunningham 52 1987
Jeremy Wiesen Associate Professor of Business Law 57 --
and Accounting, Leonard N. Stern
School of Business, New York
University
</TABLE>
David Mintz, the founder of the Company, has been Chairman of the Board and
Chief Executive Officer of the Company and its predecessor since August 1981.
Bernard Koster has been counsel to the New Jersey law firm of Litwin and
Holsinger since January 1993. Since February 1990, Mr. Koster has been
self-employed as a business consultant.
Reuben Rapoport has been the Director of Product Development of the Company
since January 1984.
Franklyn Snitow has been a partner in the New York law firm of Snitow &
Cunningham (the successor to Snitow & Pauley), the Company's general counsel,
since 1985.
-4-
<PAGE>
Jeremy Wiesen has been an Associate Professor of Business Law and
Accounting at the Leonard N. Stern School of Business, New York University since
1972. He was a member of the board of directors of Mego Mortgage Corporation
from November 1996 through March 1998 and was previously a director and officer
of the Company from June 1983 through January 1986.
All directors of the Company hold office until the next Annual Meeting of
Shareholders and until their successors have been elected and qualified.
Officers serve at the discretion of the Board of Directors. There are no family
relationships between any directors and executive officers of the Company. All
of the executive officers devote their full time to the operations of the
Company.
The Board recommends that the shareholders vote FOR the election of each
nominee for Director named above.
Board of Directors
The business and affairs of the Company are managed under the direction of
the Board of Directors, composed of two non-employee directors and two employee
directors as of the date of this Proxy Statement. The Board of Directors
establishes the overall policies and standards for the Company and reviews the
performance of management. Members of the Board are kept informed of the
Company's operations at meetings of the Board and its Audit Committee and
through reports and discussions with management. In addition, members of the
Board periodically visit the Company's facilities. Members of management are
available at Board meetings and at other times to answer questions and to
discuss issues.
In 1998 the Board of Directors held 3 meetings, 2 of which were held by
telephone conference. Each director was present for all of the meetings of the
Board, and each member of the Audit Committee attended the one meeting of such
committee. The Audit Committee is composed of Mr. Koster and Mr. Snitow.
The duties of the Audit Committee include the recommendation of the
appointment of independent public accountants for the Company, review of the
scope of audits proposed by the independent public accountants, and
consultations with the independent public accountants on matters relating to
internal financial controls and procedures.
Share Ownership of Directors and Executive Officers
The following table sets forth as of April 15, 1999, certain information
regarding the Company's Common Stock, $.01 par value, for each person known by
the Company to be the beneficial owner of more than 5% of the outstanding shares
of the Company's Common Stock, for each executive officer named in the Summary
Compensation Table, for each of the Company's directors and the nominee for
director and for the executive officers and directors of the Company as a group:
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<PAGE>
Amount of
Name Beneficial Ownership Percent of Class
- ---- -------------------- ----------------
David Mintz........................ 3,454,440 (1) 53.2%
Steven Kass........................ 275,000 (2) 4.3%
Reuben Rapoport.................... 85,000 (3) *
Franklyn Snitow.................... 50,000 (4) *
Bernard Koster..................... 25,000 (5) *
Jeremy Wiesen (6).................. 64,500 (7) *
All Executive Officers and
Directors as a group (5 persons)... 3,889,440 (8) 56.5%
_____________
The address of Messrs. Mintz, Kass and Rapoport is c/o Tofutti Brands Inc.,
50 Jackson Drive, Cranford, New Jersey 07016. The address of Mr. Snitow is 575
Lexington Avenue, New York, NY 10017. The address of Mr. Koster is 7 Old Smith
Road, Tenafly, New Jersey 07670. The address of Mr. Wiesen is Tisch Hall, 40
West 4th Street, Suite 300, New York, New York 10012. Each person listed above
has sole voting and/or investment power of the shares attributed to him.
* Less than 1%.
(1) Includes 307,000 shares issuable upon the exercise of currently exercisable
stock options.
(2) Issuable upon the exercise of currently exercisable stock options.
(3) Includes 65,000 shares issuable upon the exercise of currently exercisable
stock options.
(4) Includes 30,000 shares issuable upon the exercise of currently exercisable
stock options.
(5) Includes 25,000 shares issuable upon the exercise of currently exercisable
stock options.
(6) Nominee for director.
(7) Includes 14,000 shares held by the Jeremy Wiesen Foundation of which Mr.
Wiesen is the trustee.
(8) Includes 702,000 shares issuable upon the exercise of currently exercisable
stock options.
Director and Executive Officer Securities Reports
Compliance with Section 16(a) of The Exchange Act. Section 16(a) of the
Securities Exchange Act of 1934, as amended, requires the Company's officers and
directors, and persons who own more than ten percent of its Common Stock, to
file initial statements of beneficial ownership (Form 3), and statements of
changes in beneficial ownership (Forms 4 or 5), of Common Stock and other equity
securities of the Company with the Securities and Exchange Commission (the
"SEC") and the American Stock Exchange. Officers, directors and greater than
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<PAGE>
ten-percent stockholders are required by SEC regulation to furnish the Company
with copies of all such forms they file.
To the Company's knowledge, based solely on its review of the copies of
such forms received by it, or written representations from certain reporting
persons that no additional forms were required for those persons, the Company
believes that during fiscal 1998 all persons subject to these reporting
requirements filed the required reports on a timely basis.
Executive Compensation
The following table sets forth information concerning the total
compensation during the last three fiscal years for the Company's executive
officers whose total salary in fiscal 1998 totaled $100,000 or more:
SUMMARY COMPENSATION TABLE
--------------------------
Annual Long-Term
Compensation Compensation
------------ ------------
Securities Underlying
Name and Principal Position Year Salary ($) Options (#)
- --------------------------- ---- ---------- -----------
David Mintz 1998 $225,000(1) --
Chief Executive Officer 1997 180,000(2) 480,000
and Chairman of the Board 1996 155,000(3) --
Steven Kass
Chief Financial Officer 1998 145,000(1) --
Secretary and Treasurer 1997 117,500(2) 430,000
1996 100,000(3) --
- ---------------
(1) Includes bonuses of $50,000 and $35,000 for Messrs. Mintz and Kass,
respectively, accrued at year-end and payable April 1, 1999.
(2) Includes bonuses of $30,000 and $15,000 for Messrs. Mintz and Kass,
respectively, accrued at year-end and payable April 1, 1998.
(3) Includes bonuses of $30,000 and $15,000 for Messrs. Mintz and Kass,
respectively, accrued at year-end and payable April 1, 1997.
The aggregate value of all other perquisites and other personal benefits
furnished in each of the last three years to each of these executive officers
was less than 10% of each officer's salary for such year. There are currently no
employment agreements between the Company and any of its officers. Neither Mr.
Snitow nor Mr. Koster has received any cash remuneration from the Company for
his service as a director in the last three years.
Stock Options
The following table provides information concerning the grants and
exercising of stock options during the Company's last fiscal year to each of the
officers named above in the Summary Compensation Table.
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<PAGE>
<TABLE>
<CAPTION>
OPTIONS GRANTED IN LAST FISCAL YEAR
-----------------------------------
Number of Percent of
Shares Total Options
Underlying Granted to
Options Employees in
Name Granted (#) Fiscal Year Exercise Price ($/SH) Expiration Date
- ---- ----------- ----------- --------------------- ---------------
<S> <C> <C> <C> <C>
David Mintz, -- -- $ -- --
Chief Executive Officer
and Chairman of the
Board
Steven Kass, -- -- -- --
Chief Financial Officer,
Secretary and Treasurer
</TABLE>
The following table provides information concerning stock options held in
1998 by each of the executive officers named above in the Summary Compensation
Table.
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST
FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES
---------------------------------------------
Number of Shares Value of Unexercised
Shares Underlying Unexercised in the Money Options
Acquired on Value Options at FY-End (#) at FY-End ($)
Name Exercise (#) Realized ($) Exercisable/Unexercisable Exercisable/Unexercisable
- ---- ------------ ------------ ------------------------- -------------------------
<S> <C> <C> <C> <C>
David Mintz, -- $ -- 174,000(E) $32,696 (E)(1)
Chief Executive Officer 306,000(U) 64,904 (U)(1)
and Chairman of the
Board
Steven Kass, -- -- 155,000(E) 39,687 (E)(1)
Chief Financial Officer, 275,000(U) 77,187 (U)(1)
Secretary and Treasurer
</TABLE>
- -----------------------
(E) Exercisable options
(U) Unexercisable options
(1) Calculated by subtracting option exercise price from year-end market price.
-8-
<PAGE>
Certain Transactions
On October 17, 1994, the Company's Board of Directors adopted a resolution
wherein the Company was authorized to purchase a $1,000,000 split dollar
insurance plan on the life of a member of David Mintz's family. Mr. Mintz is
Chairman and Chief Executive Officer of the Company. The purpose of this
transaction is to provide the Mintz estate with funds sufficient to pay any
estate taxes levied upon the transfer of Mr. Mintz's Tofutti stock, which would
have otherwise necessitated a sale of the stock. The sale of such stock might
have a negative effect of significantly decreasing the market price of the stock
to the detriment of other shareholders. Upon the death of the family member, the
Company is to receive a complete refund of all its premiums paid plus interest
at 4%.
ITEM 2.
APPOINTMENT OF AUDITORS
The following resolution will be offered by the Board of Directors at the
Annual Meeting.
"RESOLVED: That the appointment of Wiss & Company, LLP by the Board of
Directors of the Company to conduct the annual audit of the financial
statements of Tofutti Brands Inc. for the fiscal year ending January
1, 2000 is ratified, confirmed and approved."
The Board of Directors recommends a vote FOR the foregoing proposal for the
following reasons:
The Board of Directors of the Company has appointed Wiss & Company, LLP
("Wiss & Co."), public accountants, to replace KPMG LLP ("KPMG"), as its
auditors. There was no dispute with KPMG leading to the change in auditors. The
Company is making the change as part of its efforts to reduce administrative
expenses. The Board of Directors is convinced that the Wiss & Co. has the
necessary knowledge of the Company's operations, and personnel, professional
qualifications and independence to act as the Company's auditors. The Board
recommends that the shareholders ratify and approve the selection of Wiss & Co.
as the Company's auditors for the fiscal year ending January 1, 2000.
In the event this resolution does not receive the necessary vote for
adoption, or if for any reason Wiss & Co. ceases to act as auditors for the
Company, the Board of Directors of the Company will appoint other independent
public accountants as auditors.
Representatives of Wiss & Co. will attend the Annual Meeting. They will be
available to respond to appropriate questions from shareholders at the meeting.
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<PAGE>
OTHER MATTERS
The Board of Directors does not intend to bring any matters before the
Annual Meeting other than those specifically set forth in the Notice of the
Annual Meeting and knows of no matters to be brought before the Annual Meeting
by others. If any other matters properly come before the Annual Meeting, it is
the intention of the persons named in the accompanying proxy to vote such proxy
in accordance with the judgment of the Board of Directors.
Financial statements for the Company are included in its Annual Report to
Shareholders for the year 1998, which was expected to be mailed to the
shareholders beginning April 23, 1999.
A COPY OF THE COMPANY'S 1998 ANNUAL REPORT ON FORM 10-KSB FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS AVAILABLE WITHOUT CHARGE TO THOSE
SHAREHOLDERS WHO WOULD LIKE MORE DETAILED INFORMATION CONCERNING THE COMPANY. TO
OBTAIN A COPY, PLEASE WRITE TO: STEVEN KASS, SECRETARY, TOFUTTI BRANDS INC., 50
JACKSON DRIVE, CRANFORD, NEW JERSEY 07016.
By Order of the Board of Directors,
/s/Steven Kass
Steven Kass
Secretary
Dated: April 23, 1999
-10-
<PAGE>
APPENDIX A
TOFUTTI BRANDS INC.
50 Jackson Drive
Cranford, New Jersey 07016
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints David Mintz and Steven Kass, or either of
them, attorneys or attorney of the undersigned, for and in the names(s) of the
undersigned, with power of substitution and revocation in each to vote any and
all shares of Common Stock, par value $.01 per share, of Tofutti Brands Inc.
(the "Company"), which the undersigned would be entitled to vote as fully as the
undersigned could if personally present at the Annual Meeting of Shareholders of
the Company to be held on May 27, 1999 at 10:00 a.m. at the Holiday Inn Select,
36 Valley Road, Clark, New Jersey, and at any adjournment or adjournments
thereof, hereby revoking any prior proxies to vote said shares, upon the
following items of business more fully described in the notice of and proxy
statement for such Annual Meeting (receipt of which is hereby acknowledged):
(CONTINUED ON OTHER SIDE)
<PAGE>
(1) The election of five Directors.
DAVID MINTZ
[ ] FOR all nominees listed at right BERNARD KOSTER
(except as marked to contrary) REUBEN RAPOPORT
FRANKLYN SNITOW
JEREMY WIESEN
[ ] WITHHOLD AUTHORITY to vote for all
nominees listed at right
INSTRUCTION: To withhold authority to vote for any individual nominee, strike a
line through the nominee's name at right.
(2) To ratify the appointment of Wiss & Company, LLP to
examine the Company's accounts for 1999.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(3) To transact such other business as may properly come
before the meeting, or any adjournment thereof.
THIS PROXY WILL BE VOTED AS SPECIFIED ABOVE. UNLESS OTHERWISE INDICATED,
THIS PROXY WILL BE VOTED FOR (i) ELECTION OF THE FIVE NOMINEES FOR DIRECTOR
NAMED IN ITEM 1 AND (ii) THE RATIFICATION OF THE APPOINTMENT OF WISS & COMPANY,
LLP AS THE COMPANY'S INDEPENDENT AUDITORS FOR 1999.
Dated____________________________________1999
---------------------------------------------
Signature(s)
---------------------------------------------
Signatures, if held jointly
(Please sign exactly as name(s) appear(s)
hereon. When signing as attorney, executor,
administrator, trustee, guardian, or as an
officer signing for a corporation, please
give full title under signature.)
