UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
AMENDMENT NO. 1
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended September 30, 1997
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 1-11556
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UNI-MARTS, INC.
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(Exact name of registrant as specified in its charter)
Delaware 25-1311379
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
477 East Beaver Avenue, State College, PA 16801-5690
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (814) 234-6000
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Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
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Common Stock, $.10 Par Value American Stock Exchange
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Securities registered pursuant to Section 12(g) of the Act:
None
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(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
Aggregate market value of the voting stock which consists solely of shares of
common stock held by non-affiliates of the registrant as of December 31, 1997,
computed by reference to the closing sale price of the registrant's common
stock on such date: $18,671,681.
6,669,515 shares of Common Stock were outstanding at December 31, 1997.
This Document Contains 9 Pages.
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<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
The Board of Directors is composed of three classes. Class II, Class III and
Class I Directors will serve until the Annual Meetings of Stockholders in 1998,
1999 and 2000, respectively, and thereafter for terms of three years until
their successors have been elected and qualified. Class I and Class II are
each composed of three Directors and Class III is composed of two Directors.
Directors with terms expiring in 1998:
Name Age Position
- ---- --- --------
J. Kirk Gallaher 51 Executive Vice President, Chief
Financial Officer and Director
G. David Gearhart (3)(4)(5)(6) 45 Director
Jeremiah A. Keating (1)(5) 58 Director
Directors whose present terms continue until 1999:
Name Age Position
- ---- --- --------
Joseph V. Paterno (1)(3)(5) 71 Director
Daniel D. Sahakian (2)(3)(4) 65 Director
Directors whose present terms continue until 2000:
Name Age Position
- ---- --- --------
Henry D. Sahakian (3)(4)(5) 61 Chairman of the Board and
Chief Executive Officer
Bruce K. Heim (2)(3)(4) 56 Director
Michael J. Serventi (1)(5) 47 Director
- -------------------
(1) Member of the Audit Committee.
(2) Member of the Compensation Committee.
(3) Member of the Executive Committee.
(4) Member of the Nominating Committee.
(5) Member of the Strategic Planning Review Committee.
(6) Member of the Stock Option Committee.
Henry D. Sahakian is the founder of the Company and has served as Chairman of
the Board since the Company's inception. He also served as the Company's
President until October 1994.
J. Kirk Gallaher joined the Company in April 1980 and has served as Executive
Vice President and Chief Financial Officer since October 1994. From 1987 to
1994, Mr. Gallaher served as the Company's Senior Vice President and Chief
Financial Officer. Mr. Gallaher became a Director of the Company in October
1986.
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<PAGE>
G. David Gearhart became Senior Vice President and Managing Director of
Grenzebach Glier & Associates, Inc. in 1995. He was Senior Vice President for
Development and University Relations of The Pennsylvania State University for
the preceding ten years. Mr. Gearhart became a Director of the Company in
October 1994.
Bruce K. Heim has served for the past 15 years as Chairman of the Board and
President of Keystone Real Estate Group, Inc., a property management and
investment company located in State College, Pennsylvania. Mr. Heim became a
Director of the Company in November 1977.
Jeremiah A. Keating has been President of Jet Aviation Business Jets, Inc., a
company providing charter aircraft services located in Teterboro, New Jersey,
since February 1990. Mr. Keating became a Director of the Company in September
1987.
Joseph V. Paterno has been the head coach of The Pennsylvania State University
football team for the past 30 years. Mr. Paterno became a Director of the
Company in December 1986.
Daniel D. Sahakian has served for the past 17 years as President and Chief
Executive Officer of HFL Corporation and for the past 10 years as President of
Unico Corporation, both of which are controlled by him and Henry D. Sahakian.
HFL Corporation and Unico Corporation are commercial real estate companies.
Mr. Sahakian became a Director of the Company in October 1981. He is Henry D.
Sahakian's brother.
Michael J. Serventi has been President and Chief Executive Officer of Lew-Mark
Baking Co., Inc. and Garden State Cookies, Inc. for the past 14 years. Mr.
Serventi became a Director of the Company in December 1986.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers and persons who own more than ten percent of
its Common Stock to file with the Securities and Exchange Commission and the
American Stock Exchange initial reports of ownership and reports of changes in
ownership of Common Stock and other equity securities of the Company.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to it and written representations that no other reports were
required during or with respect to the fiscal year ended September 30, 1997,
all Section 16(a) filing requirements applicable to its officers, directors and
greater than ten-percent shareholders were complied with; except that Mr.
Joseph V. Paterno inadvertently failed to timely file a report showing change
in ownership arising from a charitable contribution in December 1996.
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<PAGE>
ITEM 11. EXECUTIVE COMPENSATION.
Summary Compensation Table. The following table sets forth the total annual
compensation paid or accrued by the Company to or for each executive officer of
the Company for the periods listed below:
<TABLE>
<CAPTION>
Summary Compensation Table
Long-Term Compensation
---------------------------------------
Awards Payouts
---------------------------- -------
Securities
Annual Compensation Underlying Performance All
-------------------------- Options/SARs Unit Plan Other
Name and Principal Position Year Salary($) Bonus($) (# of Shares) (# of Units) $ Comp.($)
- --------------------------- ---- --------- -------- ------------- ------------ ------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Henry D. Sahakian, 1997 294,500 0 22,410 0 28,050 60,279(a)(b)(c)
Chairman of the Board 1996 288,900 0 14,940 1,500 57,221 61,133(a)(b)(c)
and Chief Executive Officer 1995 270,000 167,832 13,000 1,650 0 61,342(a)(b)(c)
Charles R. Markham, 1997 170,014 0 15,480 0 21,000 50,499(a)(b)(c)
President, Chief 1996 160,500 0 10,320 1,030 34,046 50,638(a)(b)(c)
Operating Officer 1995 150,000 105,894 8,500 1,120 0 50,733(a)(b)(c)
and Director (d)
J. Kirk Gallaher, 1997 147,000 0 11,145 0 16,450 24,682(a)(b)(c)
Executive Vice President, 1996 139,100 0 7,430 740 29,601 24,804(a)(b)(c)
Chief Financial Officer 1995 130,000 93,906 6,500 840 0 24,879(a)(b)(c)
and Director
Howard D. Romines, 1997 113,000 0 4,605 0 6,450 21,779(a)(b)(c)
Executive Vice 1996 107,000 0 3,070 310 0 21,931(a)(b)(c)
President (e) 1995 100,000 31,968 2,500 335 0 21,958(a)(b)(c)
</TABLE>
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(a) Includes premiums paid by the Company on split-dollar insurance policies on
the lives of Henry D. Sahakian, Charles R. Markham, J. Kirk Gallaher and
Howard D. Romines in the amounts of $53,610, $44,605, $18,851 and $15,751,
respectively, for the fiscal year ended September 30, 1997, $54,188,
$44,605, $18,851 and $15,751, respectively, for the fiscal year ended
September 30, 1996 and $54,365, $44,605, $18,851 and $15,751, respectively,
for the fiscal year ended September 30, 1995.
(b) Includes Company contributions to the Company's Deferred Compensation Plan
in the amount of $5,000 for each executive officer listed.
(c) Includes Company contributions to the Company's Retirement Savings and
Incentive Plan (the "Savings Plan") for Messrs. Sahakian, Markham, Gallaher
and Romines in the amounts of $1,669, $894, $831 and $1,028, respectively,
for the fiscal year ended September 30, 1997, $1,945, $1,033, $953 and
$1,180, respectively, for the fiscal year ended September 30, 1996 and
$1,977, $1,128, $1,028 and $1,207, respectively, for the fiscal year ended
September 30, 1995.
(d) Mr. Markham retired on December 8, 1997.
(e) Mr. Romines retired on October 20, 1997.
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<PAGE>
Grants of Stock Options. The following table sets forth incentive stock
options granted to executive officers during the fiscal year ended
September 30, 1997:
<TABLE>
<CAPTION>
Options/SAR Grants Table
Option/SAR Grants in Last Fiscal Year
Potential
Realizable Value
at Assumed Annual
Rates of Stock
Price Appreciation
Individual Grants For Option Terms
--------------------------------------------------- ------------------
% of Total
Options/SARs
Options/ Granted to Exercise
SARs Employees in Price Expiration
Name Granted(#) Fiscal Year ($/Share) Date 5% ($) 10% ($)
- ---- ---------- ------------- --------- ---------- -------- -------
<S> <C> <C> <C> <C> <C> <C>
Henry D. Sahakian 22,410 26.6% 6.25(1) 11-03-06(1) 65,297 158,566
Charles R. Markham 15,480 18.4% 6.25 11-03-06 60,825 154,132
J. Kirk Gallaher 11,145 13.2% 6.25 11-03-06 43,792 110,969
Howard D. Romines 4,605 5.5% 6.25 11-03-06 18,094 45,851
</TABLE>
(1) Mr. Sahakian received stock option grants for 11,205 shares with an
exercise price of $6.875 which expire November 3, 2001 and 11,205 shares
with an exercise price of $6.25 which expire on November 3, 2006.
Stock Option Exercises and Fiscal Year-End Stock Option Values. The following
table sets forth information concerning stock options exercised during the
1997 fiscal year and the value of stock options held at the end of the fiscal
year ended September 30, 1997 by each of the Company's executive officers:
<TABLE>
<CAPTION>
Aggregated Options/SAR Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
Number of
Securities Value of
Underlying Unexercised
Unexercised In-The-Money
Options/SARs Options/SARs
Shares at FY-End (#) at FY-End ($)
Acquired Value ------------- ---------------
on Realized Exercisable/ Exercisable/
Name Exercise ($) Unexercisable Unexercisable
- ---- -------- -------- ------------- ---------------
<S> <C> <C> <C> <C>
Henry D. Sahakian 0 0 41,040/22,410 0/0
Charles R. Markham 0 0 34,820/15,480 55,875/0
J. Kirk Gallaher 0 0 34,290/11,145 3,375/0
Howard D. Romines 0 0 12,870/4,605 1,125/0
</TABLE>
All options held by the named individuals were fully exercisable at
September 30, 1997 except options granted on November 4, 1996.
Compensation of Directors. During the 1997 fiscal year, each Director who was
not an employee of the Company received a retainer of $7,500, of which $5,000
was paid in shares of Common Stock. Each nonemployee Director also received
grants of stock options to purchase 4,000 shares of the Company's Common Stock
(3,000 shares for Mr. Gearhart and Charles C. Pearson, Jr.) at an exercise
price of $5.625, for serving as a Director during fiscal year 1997. Each
nonemployee Director also received $1,000 for each board or committee meeting
attended. Committee chairmen received $2,000 for each meeting they chaired.
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<PAGE>
Employment Agreements. The Company has entered into a change-in-control
agreement with each of Messrs. Henry D. Sahakian and Gallaher which provides
for, among other things, the payment of an amount equal to 2.99 times the
officer's base compensation if such officer's employment is terminated in
connection with a change in control of the Company.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee of the Company's Board of Directors
were Messrs. Heim, Pearson and Daniel D. Sahakian. Mr. Pearson resigned as a
Director in November 1997.
In fiscal year 1997, the Company purchased a property from Nicholas, Heim and
Kissinger Associates, a partnership in which Bruce K. Heim is also a partner,
for $1,500,000. The Company also paid rents to Nicholas, Heim and Kissinger
Associates of $35,500.
The Company leases one store location from Daniel D. Sahakian which Mr.
Sahakian purchased from HFL Corporation in fiscal year 1995. The lease has a
remaining term of 10 years with two five-year and one four-year renewal
options, with the rent increasing by 2% each year. Rent paid to Daniel D.
Sahakian under this lease during fiscal year 1997 was $27,600.
During fiscal year 1997, the Company leased five store locations and two other
locations from Unico. Certain directors, executive officers and stockholders
of the Company are also directors, executive officers and stockholders of
Unico. Effective October 1, 1992, the leases for five of these locations are
for terms of 15 years with two five-year and one four-year renewal options.
Annual rental increases are limited to a maximum of 2% each year. The leases
for the remaining two locations are for one-year periods, with rents increasing
by 2% each year, and are cancelable only at the option of the Company at the
end of any year upon six months' written notice. Aggregate rent paid under
these leases during fiscal year 1997 was $184,700.
The Company leases its corporate headquarters, certain storage facilities and
three of its store locations from HFL Corporation, all of the stock of which is
beneficially owned or controlled by Henry D. Sahakian and Daniel D. Sahakian.
The leases for the corporate headquarters and storage facilities were entered
into in years 1991 to 1997, expire in 1997 to 2000 and provide for a current
aggregate rent of $391,000. Some of the leases are renewable annually subject
to increases of 2% to 4%. The aggregate rent paid to HFL Corporation for the
corporate headquarters and storage facilities was $385,600 for fiscal year
1997. The three leases of store locations from HFL Corporation which were
entered into from August 1995 to October 1997 are for terms of five years with
renewal options and provide for annual rents aggregating $78,500. The
aggregate rent paid under these leases to HFL Corporation during fiscal year
1997 was $74,700.
During fiscal year 1997, the Company received from HFL Corporation $11,700 as
reimbursement for certain general and administrative expenses. The Company
intends to continue to provide some administrative services for HFL Corporation
and expects to be reimbursed therefor.
On February 26, 1993, the Company made a one-time, special grant of
nonqualified stock options to Henry D. Sahakian and Daniel D. Sahakian each to
purchase 150,000 shares of Common Stock at a price of $4.50 per share in
exchange for their relinquishment of effective voting control of the Company as
a result of the elimination of the super-majority voting provisions of the
Company's Class B Common Stock. Henry D. Sahakian exercised his option in
fiscal year 1996.
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<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth, as of December 31, 1997, information with
respect to the beneficial ownership of the Company's Common Stock by (i) each
person known to the Company to own 5% or more of the outstanding shares of
Common Stock, (ii) each of the Company's Directors and Executive Officers,
(iii) two former Executive Officers of the Company and (iv) all of the
Directors and Executive Officers as a group. As of such date, there were
6,669,515 shares of Common Stock outstanding.
Common Stock
Beneficial Ownership (1)
-------------------------
Name and Address of Beneficial Owner (2) Shares Percentage
- ---------------------------------------- ---------- ----------
Henry D. Sahakian 645,973 (5) 9.6%
J. Kirk Gallaher 95,215 (6) 1.4
G. David Gearhart 13,617 (7) 0.2
Bruce K. Heim 48,529 (8) 0.7
Jeremiah A. Keating 16,355 (9) 0.2
Charles R. Markham (3) 37,876 (10) 0.6
Joseph V. Paterno 28,475 (11) 0.4
Howard D. Romines (4) 2,524 (12) 0.0
Daniel D. Sahakian 426,394 (13) 6.2
Michael J. Serventi 253,139 (14) 3.8
All Directors and Executive Officers as a Group
(10 persons) 1,568,097 22.4
Alexander Sahakian Trust 423,500 6.3
Armen D. Sahakian 379,279 5.7
- ---------------------------
(1) Includes options to purchase Common Stock granted pursuant to the
Company's Equity Compensation Plan and certain nonqualified stock options
which are exercisable within 60 days.
(2) Addresses of all beneficial owners listed except Charles R. Markham and
Howard D. Romines are in care of the Company. Mr. Markham's address is
1005 Greenbriar Drive, State College, PA 16801. Mr. Romines' address is
24 Cricklewood Circle, State College, PA 16803.
(3) Mr. Markham retired in December 1997.
(4) Mr. Romines retired in October 1997.
(5) Includes 92,400 shares held by Henry D. Sahakian jointly with his wife,
28,000 shares owned by his wife, 8,266 shares held in the Savings Plan
and options to purchase 63,450 shares of Common Stock. Henry D. Sahakian
is one of two trustees for two trusts for the benefit of Daniel D.
Sahakian's children. Henry D. Sahakian disclaims beneficial ownership
of, and the beneficial ownership in the table above does not include, the
stock held by these two trusts.
(6) Includes 48,457 shares held by Mr. Gallaher jointly with his wife, 1,323
shares held in the Savings Plan and options to purchase 45,435 shares of
Common Stock.
(7) Includes 3,036 shares held by Mr. Gearhart jointly with his wife and
options to purchase 7,750 shares of Common Stock.
(8) Includes 30,142 shares owned by Mr. Heim's wife and options to purchase
11,000 shares of Common Stock.
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<PAGE>
(9) Includes 1,100 shares held by Mr. Keating jointly with his wife and
options to purchase 11,000 shares of Common Stock.
(10) Includes 1,482 shares held in the Savings Plan.
(11) Includes 13,100 shares held by Mr. Paterno jointly with his wife and
options to purchase 11,000 shares of Common Stock.
(12) Includes 2,062 shares held in the Savings Plan.
(13) Includes 37,950 shares held jointly with his wife, 70,115 shares held for
two trusts and options to purchase 161,000 shares of Common Stock. The
beneficial ownership in the table above does not include 635,250 shares
held by two trusts for the benefit of Daniel D. Sahakian's children.
(14) Includes options to purchase 11,000 shares of Common Stock.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The Company received commissions of $428,800 in fiscal year 1997 from Coinfone
Telecommunications, Inc. ("CTI") for coin-operated telephones installed at
convenience store locations and for the sale of prepaid telephone cards. The
Company also made payments of $577,000 in fiscal year 1997 to CTI for
discounted prepaid telephone cards and telephone service. The majority of the
stock of CTI is beneficially owned or controlled by persons related to Henry D.
Sahakian. See "Compensation Committee Interlocks and Insider Participation"
for additional discussion of related party transactions.
The foregoing transactions and those described under "Compensation Committee
Interlocks and Insider Participation" were or are, as the case may be, on terms
which are at least as favorable as could have been obtained with or from a
third party. All such transactions were approved by a majority of the
independent directors of the Board.
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<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
UNI-MARTS, INC.
(Registrant)
Date January 27, 1998 By: /S/ HENRY D. SAHAKIAN
---------------- ------------------------------
Henry D. Sahakian
Chairman of the Board
(Principal Executive Officer)
Date January 27, 1998 By: /S/ J. KIRK GALLAHER
---------------- ------------------------------
J. Kirk Gallaher
Executive Vice President and
Chief Financial Officer
(Principal Accounting Officer)
(Principal Financial Officer)
9
