<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by Registrant [ ]
Filed by Party other than the Registrant [X]
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
Uni-Marts, Inc.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities pursuant to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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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 fee is calculated and state how it
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[ ] 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:
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<PAGE> 2
Uni-Mart
477 East Beaver Avenue
State College, Pennsylvania 16801-5690
January 25, 2001
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of
Uni-Marts, Inc. The meeting will be held at The Penn Stater Conference Center
Hotel, 215 Innovation Boulevard, State College, Pennsylvania on Thursday,
February 22, 2001, commencing at 10:00 A.M.
At the meeting, you will be asked to vote on the election of three
directors who will serve until the Annual Meeting of Stockholders in 2004 and
the ratification of the appointment of Deloitte & Touche LLP as the Company's
independent auditors for the fiscal year ending September 30, 2001.
In order to facilitate check-in, we will require admission tickets for
stockholders who wish to attend the meeting in person. The admission ticket is
attached to the enclosed proxy card. If you are a stockholder whose shares are
not registered in your own name and you plan to attend the meeting, please bring
a copy of the voting form sent to you by your broker or other evidence of stock
ownership.
Your vote is important. Whether or not you plan to attend the meeting,
please sign, date and mail your proxy in the enclosed postpaid envelope
promptly.
Sincerely,
/s/ Henry D. Sahakian
HENRY D. SAHAKIAN
Chairman of the Board
and Chief Executive Officer
<PAGE> 3
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
---------------
UNI-MARTS, INC.
477 EAST BEAVER AVENUE
STATE COLLEGE, PENNSYLVANIA 16801-5690
---------------
To The Stockholders:
You are hereby notified that the Annual Meeting of Stockholders of
Uni-Marts, Inc., a Delaware corporation, will be held at The Penn Stater
Conference Center Hotel, 215 Innovation Boulevard, State College, Pennsylvania
at 10:00 A.M. on Thursday, February 22, 2001, for the following purposes:
1. To elect three Class II directors who will serve until the Annual
Meeting of Stockholders in 2004;
2. To ratify the appointment of Deloitte & Touche LLP as the Company's
independent auditors for the fiscal year ending September 30, 2001; and
3. To transact such other business as may properly come before the
meeting. The Board of Directors is not aware of any other business to
be presented to a vote of the stockholders at the Annual Meeting.
Information relating to the above matters is set forth in the attached
Proxy Statement. Only stockholders of record at the close of business on
December 28, 2000 are entitled to receive notice of and to vote at the Annual
Meeting and any adjournment thereof.
/s/ Harry A. Martin
HARRY A. MARTIN
Secretary
State College, Pennsylvania
January 25, 2001
PLEASE READ THE ATTACHED PROXY STATEMENT AND THEN PROMPTLY COMPLETE, EXECUTE AND
RETURN THE ENCLOSED PROXY CARD IN THE ACCOMPANYING POSTAGE-PAID ENVELOPE. YOU
CAN SPARE YOUR COMPANY THE EXPENSE OF FURTHER PROXY SOLICITATION BY RETURNING
YOUR PROXY CARD PROMPTLY.
IF YOU PLAN TO ATTEND THE MEETING, PLEASE BRING THE ADMISSION TICKET ATTACHED TO
THE ENCLOSED PROXY CARD. IF YOU ARE A STOCKHOLDER WHOSE SHARES ARE NOT
REGISTERED IN YOUR OWN NAME AND YOU PLAN TO ATTEND THE MEETING, PLEASE BRING A
COPY OF THE VOTING FORM SENT TO YOU BY YOUR BROKER OR OTHER EVIDENCE OF STOCK
OWNERSHIP.
<PAGE> 4
UNI-MARTS, INC.
477 EAST BEAVER AVENUE
STATE COLLEGE, PA 16801-5690
---------------
PROXY STATEMENT
---------------
This Proxy Statement is furnished to the stockholders of Uni-Marts, Inc.
(the "Company") in connection with the solicitation by the Board of Directors of
the Company of proxies to be voted at the Annual Meeting of Stockholders on
February 22, 2001 (the "Annual Meeting") and any adjournment thereof. This Proxy
Statement and the accompanying proxy card are first being mailed to stockholders
on or about January 25, 2001. The expense of preparing, printing and mailing the
Proxy Statement and soliciting proxies will be paid by the Company. In addition
to the use of the mail, proxies may be solicited personally or by telephone by
regular employees of the Company without additional compensation. The Company
will reimburse banks, brokers and other custodians, nominees and fiduciaries for
their costs in sending the proxy materials to the beneficial owners of the
Company's stock.
Shares represented by valid proxies will be voted in accordance with
instructions contained therein or, in the absence of such instructions, in
accordance with the recommendations of the Board of Directors. A proxy may be
revoked by a stockholder by written notice of such revocation or by a later
dated proxy delivered to the Secretary of the Company at any time prior to the
shares represented by such proxy being voted.
Holders of record of the Company's Common Stock, par value $.10 per share,
at the close of business on December 28, 2000 are entitled to notice of, and to
vote at, the Annual Meeting. As of such date, there were outstanding 7,038,522
shares of the Company's Common Stock. Each stockholder has one vote per share on
all items of business properly presented at the Annual Meeting. Under the
Amended and Restated By-laws of the Company, the presence of a quorum is
required for the transaction of business at the Annual Meeting. The presence at
the Annual Meeting, in person or by proxy, of a majority of the total number of
shares issued and outstanding and entitled to vote thereat and a majority of the
voting power of the shares issued and outstanding shall constitute a quorum for
the transaction of business. Directors will be elected by a plurality of the
votes present in person or represented by proxy at the time of the meeting and
entitled to vote thereon. Action on all other matters scheduled to come before
the Annual Meeting will be authorized by the affirmative vote of the majority of
shares present in person or represented by proxy and entitled to vote on such
matters. Abstentions and broker nonvotes are counted for purposes of determining
the presence or absence of a quorum for the transaction of business. Abstentions
are counted in tabulations of the votes cast on proposals presented to the
stockholders, whereas broker nonvotes are not counted for purposes of
determining whether a proposal has been approved. Votes cast by stockholders
will be counted by Mellon Investor Services LLC, the Company's transfer agent.
The Company does not have any policy with respect to maintaining the
confidentiality of proxies, ballots or vote tabulations.
A copy of the Company's 2000 Annual Report, which includes financial
statements for the fiscal year ended September 30, 2000, is enclosed but does
not constitute a part of this Proxy Statement.
<PAGE> 5
PROPOSAL I
ELECTION OF DIRECTORS
The Board of Directors is composed of three classes. Class III and Class I
Directors are presently serving until the Annual Meetings of Stockholders in
2002 and 2003, respectively, and thereafter for terms of three years until their
successors have been elected and qualified. The Directors comprising Class II
will be elected at the Annual Meeting and will serve until the Annual Meeting of
Stockholders in 2004 and thereafter for terms of three years until their
successors have been elected and qualified. Each class of Directors is composed
of three Directors.
The persons named in the enclosed proxy card as proxies (the "Proxies")
intend to vote, unless instructed otherwise, for election of the nominees named
below. All nominees have consented to be named and to serve if elected. If for
any reason any of the nominees becomes unable or is unwilling to serve, at the
time of the Annual Meeting the Proxies will have discretionary authority to vote
for a substitute nominee or nominees. It is not anticipated that any nominee
will be unavailable for election. Directors will be elected by a plurality of
the votes cast.
The following sets forth information as to each nominee for election as a
Director at the Annual Meeting and each Director continuing in office, including
their ages, present principal occupations, other business experience for at
least the last five years and memberships on committees of the Board of
Directors.
Nominees for election as Class II Directors at the Annual Meeting with
terms expiring in 2004:
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Stephen B. Krumholz (2)(3)(4) 51 Director
Jack G. Najarian (1) 45 Director
Anthony S. Regensburg (1) 73 Director
</TABLE>
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE "FOR" THE ABOVE
NOMINEES.
Class III Directors whose present terms continue until 2002:
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
M. Michael Arjmand (2)(3) 53 Director
Frank R. Orloski, Sr. 68 Director
Daniel D. Sahakian (2) 68 Director
</TABLE>
Class I Directors whose present terms continue until 2003:
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Henry D. Sahakian (4) 64 Chairman of the Board and
Chief Executive Officer
Herbert C. Graves (1)(4) 74 Director
Gerold C. Shea (4) 61 Director
</TABLE>
2
<PAGE> 6
Other Executive Officer:
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
N. Gregory Petrick 45 Executive Vice President and
Chief Financial Officer
</TABLE>
---------------
(1) Member of the Audit Committee.
(2) Member of the Compensation Committee.
(3) Member of the Stock Option Committee.
(4) Member of the Strategic Planning Committee.
BIOGRAPHICAL INFORMATION: DIRECTORS AND EXECUTIVE OFFICERS
Henry D. Sahakian is the founder of the Company and has served as Chairman
of the Board and Chief Executive Officer since the Company's inception. He also
served as the Company's President until October 1994. He assumed the duties of
President again in 1997. He is Daniel D. Sahakian's brother.
M. Michael Arjmand is the founder and current Chief Executive Officer of
the Centre Analytical Laboratories, Inc., a contract research company located in
State College, Pennsylvania, and has served as Chairman of the Board of that
firm since 1986. Mr. Arjmand became a Director of the Company in April 1998.
Herbert C. Graves has served since 1998 as Chairman Emeritus of Standard
Steel Division of Freedom Forge Corp., a steel manufacturer located in
Lewistown, Pennsylvania. From 1989 to 1998, he served as Chairman of the Board
and Chief Executive Officer of that firm. Mr. Graves also served as that
Company's President from 1989 to 1994. Mr. Graves became a Director of the
Company in June 1998.
Stephen B. Krumholz has been employed since 1998 as Executive Vice
President of Freebie, Inc., an electronic database marketing company based in
Dallas, Texas. Mr. Krumholz was employed from 1972 to 1998 by 7-Eleven, Inc.,
headquartered in Dallas, Texas, and served as that Company's Executive Vice
President and Chief Operating Officer from 1993 to 1998. 7-Eleven operates or
franchises 5,700 7-Eleven and other convenience stores in the United States and
Canada and is affiliated with another 13,900 7-Eleven convenience stores in the
United States, Japan and other countries. Prior to 1993, Mr. Krumholz served in
other executive and management positions with 7-Eleven. Mr. Krumholz became a
Director of the Company in June 1998.
Jack G. Najarian has been employed since October 1999 as Managing Director
of Investment Banking and Corporate Finance of Weatherly Securities, Inc., an
investment banking firm based in New York, New York. Mr. Najarian was the
Chairman and Co-Founder of Griffin Securities, Inc., a New York investment
banking firm, from 1996 to 1999. From 1994 to 1996, he was acting Treasurer and
Director of Treasury and Capital Markets of the New York branch of National
Australia Bank. Mr. Najarian became a Director of the Company in October 1999.
Frank R. Orloski, Sr. is the founder and, until April 2000, served as
President of Orloski Service Station, Inc., a chain of 43 convenience stores
located in northeastern Pennsylvania. The Company acquired the assets of this
business in April 2000. Mr. Orloski served as President of that firm since 1970.
Mr. Orloski became a Director of the Company in October 2000.
N. Gregory Petrick joined the Company in July 1978. He was named as
Executive Vice President in October 2000 and served as the Company's Senior Vice
President and Chief Financial Officer since September 1999. From 1988 to 1999,
Mr. Petrick served as the Company's Vice President, Finance.
3
<PAGE> 7
Anthony S. Regensburg has been employed since 1989 as a consultant with AR
Consulting Group, a consulting firm based in Camden, Maine, and specializing in
convenience store distribution focusing on cigarette wholesaling and retailing.
Mr. Regensburg was employed from 1978 to 1989 in various executive positions
with Coremark, a tobacco wholesaler, and as an executive with other tobacco
firms from 1954 to 1978. Mr. Regensburg became a Director of the Company in
October 1999.
Daniel D. Sahakian has served for the past 20 years as President and Chief
Executive Officer of HFL Corporation and for the past 13 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.
Gerold C. Shea has served as President of Interconnect Enterprises, a
petroleum industry consulting firm located in Downingtown, Pennsylvania, since
1995. From 1963 to 1995, he was employed by Sun Co., Inc. ("Sun"), a major
petroleum refiner and retailer, and served as that Company's Vice President,
Sunoco and Atlantic Brand, from 1991 to 1995. In that position, he directed
retail marketing at 5,000 service stations and convenience stores. Prior to
that, Mr. Shea served in other executive and management positions with Sun. Mr.
Shea became a Director of the Company in June 1998.
For information with respect to the share ownership of the Company's
Directors and Executive Officers, see "Principal Stockholders."
The Board of Directors met six times during the last fiscal year. In fiscal
year 2000, the Board of Directors had an Audit Committee, a Compensation
Committee, a Stock Option Committee and a Strategic Planning Committee. The
Audit Committee communicates with and receives information directly from the
Company's independent auditors. The Audit Committee met two times during the
last fiscal year. The Compensation Committee periodically reviews, implements
and administers the compensation policies and programs for and performance of
the Company's executive officers and establishes guidelines for the compensation
of other personnel. The Compensation Committee met two times during the last
fiscal year. The Stock Option Committee administers the Company's 1996 Equity
Compensation Plan. The Stock Option Committee met two times during the last
fiscal year. The Strategic Planning Committee meets periodically to review and
make recommendations regarding the Company's strategic plan. The Strategic
Planning Committee met one time during the last fiscal year. Each incumbent
director attended more than 75% of the meetings of the Board of Directors and
the meetings of Board Committees on which such Director served.
COMPENSATION OF DIRECTORS. During the 2000 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. Messrs. Najarian and Regensburg also
received partial-year retainers of $3,750, of which $2,500 was paid in shares of
Common Stock. Pursuant to the Company's 1996 Equity Compensation Plan, all
non-employee directors receive annual nonqualified stock option grants for 2,000
shares of common stock plus 500 shares for each full year the director has
served as a member of the board, up to a maximum of 4,000 shares per grant, on
the date of each annual meeting. In addition, newly appointed or elected
non-employee directors receive an initial grant for 5,000 shares. Accordingly,
during the 2000 fiscal year, each non-employee Director received grants of stock
options to purchase 3,000 shares of the Company's Common Stock (4,000 shares for
Mr. Daniel D. Sahakian and 2,500 shares for Messrs. Najarian and Regensburg) at
an exercise price of $1.50 for serving as a Director during fiscal year 2000.
Messrs. Najarian and Regensburg also each received grants of stock options to
purchase 6,000 shares of the Company's Common Stock at an exercise price of
$1.125 during fiscal year 2000. Each non-employee Director also received $1,000
for each board or committee meeting attended. Committee chairmen received $2,000
for each meeting they chaired.
4
<PAGE> 8
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE. The following table sets forth the total annual
compensation paid or accrued by the Company to or for its Chief Executive
Officer and other current and former executive officers of the Company (the
"named executive officers") for the periods listed below:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
------------------------------------------
AWARDS
----------------------------
SECURITIES
ANNUAL COMPENSATION UNDERLYING PERFORMANCE PERFORMANCE ALL
--------------------------- OPTIONS/SARS UNIT PLAN UNIT PLAN OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) (# OF SHARES) (# OF UNITS) PAYOUTS ($) COMP.($)
--------------------------- ---- --------- -------- ------------- ------------ ----------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Henry D. Sahakian, 2000 333,400 0 40,000 0 0 58,914 (a)(b)(c)
Chairman of the Board 1999 367,000 0 25,000 0 0 60,309 (a)(b)(c)
and Chief Executive Officer 1998 294,500 100,000 92,410 0 10,313 62,555 (a)(b)(c)
Matthew R. Chandik, 2000 91,300 0 0 0 3,795 (b)(c)
Former Senior Vice (a)(b)(d)
President, 1999 121,902 0 20,000 0 0 30,768
Operations (f) 1998 21,404 0 20,000 0 0 30,026 (d)(e)
N. Gregory Petrick, 2000 110,000 2,200 20,000 0 0 5,163 (b)(c)
Executive Vice President 1999 90,192 0 15,000 0 0 1,355 (c)
and Chief Financial Officer (g)
</TABLE>
---------------
(a) Includes premiums paid by the Company on split-dollar insurance policies on
the life of Henry D. Sahakian in the amount of $53,790 for the fiscal year
ended September 30, 2000, premiums on the lives of Henry D. Sahakian and
Matthew R. Chandik in the amounts of $53,790 and $4,136, respectively, for
the fiscal year ended September 30, 1999, and premiums on the life of Henry
D. Sahakian in the amount of $53,610 for the fiscal year ended September 30,
1998.
(b) Includes Company contributions to the Company's Deferred Compensation Plan
for Messrs. Sahakian, Chandik and Petrick in the amounts of $5,000, $2,500
and $3,750, respectively, for the fiscal year ended September 30, 2000,
contributions for Messrs. Sahakian and Chandik in the amounts of $5,000 and
$3,750, respectively, for the fiscal year ended September 30, 1999, and a
contribution for Mr. Sahakian of $5,000 for the fiscal year ended September
30, 1998.
(c) Includes Company contributions to the Company's Retirement Savings and
Incentive Plan (the "Savings Plan") for Messrs. Sahakian, Chandik and
Petrick in the amounts of $124, $1,295 and $1,413, respectively, for the
fiscal year ended September 30, 2000, contributions for Messrs. Sahakian and
Petrick in the amounts of $1,519 and $1,355, respectively, for the fiscal
year ended September 30, 1999 and a contribution for Mr. Sahakian in the
amount of $3,945 for the fiscal year ended September 30, 1998.
(d) Includes payments for certain relocation costs paid to Mr. Chandik in the
amounts of $22,882 and $15,026, respectively, in the fiscal years ended
September 30, 1999 and September 30, 1998.
(e) Includes a hiring bonus paid to Mr. Chandik of $15,000 in the fiscal year
ended September 30, 1998.
(f) Mr. Chandik resigned on June 7, 2000.
(g) Mr. Petrick was named Executive Vice President on October 26, 2000 and
Senior Vice President and Chief Financial Officer on September 1, 1999.
5
<PAGE> 9
GRANTS OF STOCK OPTIONS. The following table sets forth incentive stock
options granted to the Company's named executive officers during the fiscal year
ended September 30, 2000:
OPTIONS/SAR GRANTS TABLE
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL
INDIVIDUAL GRANTS REALIZABLE VALUE
-------------------------------------------------- AT ASSUMED ANNUAL
% OF TOTAL RATES OF STOCK
OPTIONS/SARS PRICE APPRECIATION
OPTIONS/ GRANTED TO EXERCISE FOR OPTION TERMS
SARS EMPLOYEES IN PRICE EXPIRATION ------------------
NAME GRANTED(#) FISCAL YEAR ($/SHARE) DATE 5% ($) 10% ($)
---- ---------- ------------ --------- ---------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Henry D. Sahakian............ 40,000 16.6% 2.20 9-12-05 14,669 43,625
N. Gregory Petrick........... 20,000 8.3% 2.00 9-12-10 25,880 68,282
</TABLE>
STOCK OPTION EXERCISES AND FISCAL YEAR-END STOCK OPTION VALUES. The
following table sets forth information concerning stock options exercised during
the 2000 fiscal year and the value of stock options held at the end of the
fiscal year ended September 30, 2000 by each of the Company's named executive
officers:
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT OPTIONS/SARS AT
FY-END (#) FY-END ($)
SHARES VALUE --------------- ---------------
ACQUIRED REALIZED EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE ($) UNEXERCISABLE UNEXERCISABLE
---- ----------- -------- --------------- ---------------
<S> <C> <C> <C> <C>
Henry D. Sahakian........................ 0 0 115,683/79,077 5,208/10,417
Matthew R. Chandik....................... 0 0 0/0 0/0
N. Gregory Petrick....................... 0 0 18,000/31,000 3,125/6,250
</TABLE>
All options held by the named individuals were fully exercisable at
September 30, 2000 except options granted during fiscal year 2000, two-thirds of
the options granted during fiscal year 1999, and options for 11,205 shares
granted to Mr. Sahakian in each of fiscal years 1997 and 1998 and options for
1,000 shares granted to Mr. Petrick in fiscal year 1998. The Company does not
currently grant any long-term incentives, other than stock options, to its
executives or other employees. Similarly, the Company does not sponsor any
defined benefit or actuarial plans at this time.
EMPLOYMENT AGREEMENTS. The Company has entered into a change-in-control
agreement with each of Messrs. Sahakian and Petrick, 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.
6
<PAGE> 10
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee of the Company's Board of
Directors during fiscal year 2000 were Messrs. Arjmand, Krumholz and Daniel D.
Sahakian.
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 seven 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 2000 was $29,300.
During fiscal year 2000, the Company leased three store locations and one
other location from Unico Corporation. Henry D. Sahakian and Daniel D. Sahakian
are also directors, executive officers and stockholders of Unico Corporation.
The leases for these locations have a remaining term of seven years with two
five-year and one four-year renewal options. Annual rental increases are limited
to a maximum of 2% each year. Aggregate rent paid under these leases during
fiscal year 2000 was $77,900.
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 were entered into in years 1991 to
1996, expired in December 2000 and provide for a current aggregate rent of
$293,800. A new lease for the corporate headquarters was entered into in January
2001 for a term of 10 years. This lease provides for an annual rent of $264,800
with 2% annual increases in years two through five. The lease for the storage
facilities was entered into in 1999 for a term of five years, subject to a 4%
annual increase, and provides for an aggregate rent of $90,800. The aggregate
rent paid to HFL Corporation for the corporate headquarters, parking and storage
facilities was $406,900 for fiscal year 2000. The three leases of store
locations from HFL Corporation were entered into from October 1997 to September
2000, are for terms of five years with renewal options and provide for annual
rents aggregating $81,400. The aggregate rent paid under these leases to HFL
Corporation during fiscal year 1999 was $80,400.
During fiscal year 2000, the Company received from HFL Corporation $11,500
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.
7
<PAGE> 11
REPORT OF THE COMPENSATION COMMITTEE AND THE STOCK OPTION
COMMITTEE OF THE BOARD OF DIRECTORS
ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors (the "Committee") is
responsible for implementing and administering the Company's compensation
policies and programs for its executive officers. A separate committee
administers the Company's Stock Option Plan (the "Stock Option Committee"). The
Committee and the Stock Option Committee both are comprised entirely of
non-employee directors. The Company's compensation policy, effectuated by the
Committees, is to provide a comprehensive structure that will (i) motivate the
executive officers to implement and achieve the Company's strategic and
financial goals, (ii) retain and attract key executive personnel and (iii) align
a significant portion of the compensation of management with the interest of the
stockholders through stock options that are designed to provide additional
compensation only when all stockholders benefit through share price
appreciation. The Company and the Committees are strongly committed to
maximizing shareholder value through consistent growth and profitability.
The Company's overall compensation program for its executive officers is
currently comprised of the following three elements:
A. Base Salary;
B. Annual Bonus Plan; and
C. Stock Option Plan.
BASE SALARY AND BENEFITS
The Committee reviews the base salary and benefits provided to each
executive officer on an annual basis and evaluates this compensation against
available data for other businesses, both in related areas and in general
industry. During 2000, the Committee reviewed proxy information and other
similar data to attempt to ensure that the Company continues to provide
competitive levels of compensation. The Committee believes that the compensation
provided to the executive officers is competitive with that generally offered by
comparable convenience store operators and other similarly sized businesses
taking into account the Company's financial circumstances.
BONUSES
For the fiscal year ended September 30, 2000, no bonuses were awarded to
the executive officers based upon the terms of the Annual Bonus Plan, as
administered by the Committee. During this year, the Plan was designed to reward
the executive officers only if actual earnings per share exceeded a specified
level after the bonuses were taken into account, i.e., a bonus could be paid
only to the extent that the bonus would "be paid for" prior to the net income
figure that had to be achieved. Since earnings per share did not equal or exceed
the target set, no bonuses were earned under the Plan by any executive officer.
However, the Company and the Committee believe that an annual bonus plan is a
beneficial compensation device for the Company. The Committee has always
followed a philosophy that such a plan must relate executive compensation
directly to Company performance so that any bonuses paid will provide a
financial reward only for the achievement of substantial business results. In
light of the strong improvement in the Company's financial performance during
the 2000 fiscal year, especially in comparison to that of the prior few fiscal
years, the Committee established a modest bonus pool ($35,000) to be allocated
by the Chief Executive Officer among all salaried employees.
8
<PAGE> 12
New bonus targets were also set for the 2001 fiscal year which will require
continued improvement in the Company's quarterly profitability in order for any
payments to be made.
STOCK OPTIONS
The Committee and the Stock Option Committee believe that stock ownership
by executive officers is important in order that a portion of each executive's
compensation is directly aligned with the economic interest of the stockholders
of the Company. The Stock Option Committee believes that stock option grants
provide opportunities for capital accumulation, promote long-term retention and
foster an executive officer's proprietary interest in the Company. Under the
Stock Option Plan, options are issued at a price equal to the fair market value
of a share on the date of grant and the options generally expire after ten
years. Although the grant of stock options and the number of shares subject to
options are discretionary with the Stock Option Committee, executives have
annually received stock options in order to increase their potential for
additional stock ownership. In addition, the Committee takes into account the
number of shares subject to options and the potential long-term benefit to the
executives in setting each executive's overall compensation targets. Because the
Company and the Stock Option Committee believe that stock options are a valuable
incentive, in recent years, stock options have been extended to many other
individuals employed by the Company.
CHIEF EXECUTIVE OFFICER COMPENSATION
The salary, bonus and stock option awards of the Chief Executive Officer
are determined by the Committee and the Stock Option Committee, in conformance
with the policies described above. Mr. Sahakian was paid a base salary for the
fiscal year ending September 30, 2000 of $333,400, a reduction of $41,600 from
his base salary for the fiscal year ending September 30, 1999. Despite the
Company's improved operating results in fiscal 2000, Mr. Sahakian requested, and
the Committee agreed to, no increase for fiscal 2001. Mr. Sahakian will continue
to participate, and receive potential rewards under, the incentive based plans
established for that purpose. In this way, the Committee is acting consistently
with its philosophy of making a portion of an executive's total compensation
dependent upon the Company's performance.
The Company continues to monitor the applicability of Section 162(m) of the
Internal Revenue Code of 1986, as amended, which restricts the Federal income
tax deduction that may be claimed by a "public company" for compensation paid to
the Chief Executive Officer and the four most highly compensated other officers
to $1 million each except to the extent that any amount in excess of such limit
is paid pursuant to a plan containing a performance standard or a stock option
plan that meets certain requirements. The Company's current stock option plan
meets the requirements of Section 162(m). In light of this, the Committee does
not believe that Section 162(m) will have any adverse affect on the Company but
continues to evaluate the Company's compensation program in light of that
restriction.
<TABLE>
<S> <C>
COMPENSATION COMMITTEE STOCK OPTION COMMITTEE
Stephen B. Krumholz, Chairman Stephen B. Krumholz, Chairman
M. Michael Arjmand M. Michael Arjmand
Daniel D. Sahakian
</TABLE>
9
<PAGE> 13
PERFORMANCE GRAPH
The graph set forth below compares the cumulative total stockholder return
on the Company's Common Stock for the last five years with the cumulative total
return on the Standard and Poor's 500 Index and a peer group index based on the
common stock of the following four companies: 7-Eleven, Inc., Casey's General
Stores, Inc., Dairy Mart Convenience Stores, Inc. and Uni-Marts, Inc. The
cumulative total stockholder return set forth in the graph assumes the
investment of $100 in the Company's Common Stock and each index on September 30,
1995, and reinvestment of all dividends.
<TABLE>
<CAPTION>
UNI-MARTS, INC. S&P 500 PEER GROUP
--------------- ------- ----------
<S> <C> <C> <C>
9/30/95 100.00 100.00 100.00
9/30/96 120.00 118.00 96.00
9/30/97 79.00 162.00 93.00
9/30/98 46.00 174.00 102.00
9/30/99 18.00 219.00 71.00
9/30/00 29.00 246.00 82.00
</TABLE>
<TABLE>
<CAPTION>
9/30/95 9/30/96 9/30/97 9/30/98 9/30/99 9/30/00
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Uni-Marts, Inc..................... 100 120 79 46 18 29
S & P 500.......................... 100 118 162 174 219 246
Peer Group......................... 100 96 93 102 71 82
</TABLE>
10
<PAGE> 14
REPORT OF THE AUDIT COMMITTEE
OF THE BOARD OF DIRECTORS
The following is the report of the Audit Committee (the "Committee") with
respect to the Company's audited financial statements for the fiscal year ended
September 30, 2000, which include the consolidated balance sheets of the Company
and its subsidiaries as of September 30, 2000 and 1999, and the related
consolidated statements of operations, stockholders' equity, and cashflows for
each of the three years in the period ended September 30, 2000, and the notes
thereto. The information contained in this report shall not be deemed to be
"soliciting material" nor shall such information be incorporated by reference
into any filing under the Securities Act of 1933, as amended, or the 1934
Securities Exchange Act, as amended, except to the extent that the Company
specifically incorporates it by reference in such filing.
The Committee consists of the following members of the Company's Board of
Directors: Herbert C. Graves, Chairman, Jack G. Najarian and Anthony S.
Regensburg. Each of the members of the Committee is independent as defined under
the National Association of Securities Dealers' listing standards. The Committee
operates pursuant to a written charter adopted by the Board of Directors which
is included in this proxy statement as Appendix A.
The Committee has reviewed and discussed the Company's audited financial
statements with management.
The Committee has discussed the matters required to be discussed by SAS 61
(Communication with Audit Committees) with Deloitte & Touche LLP, the Company's
independent auditors.
The Committee has received written disclosures and the letter from Deloitte
& Touche LLP required by Independence Standards Board Standard No. 1 (which
relates to the accountant's independence from the Company and its related
entities) and has discussed with Deloitte & Touche LLP their independence from
the Company and its related entities.
Based on the review and discussions referenced above, the Committee
recommended to the Company's Board of Directors that the Company's audited
financial statements be included in the Company's Annual Report on Form 10-K for
the fiscal year ended September 30, 2000.
AUDIT COMMITTEE
Herbert C. Graves, Chairman
Jack G. Najarian
Anthony S. Regensburg
11
<PAGE> 15
CERTAIN TRANSACTIONS
The Company received commissions of $171,600 in fiscal year 2000 from
TeleBeam Incorporated ("TeleBeam") for coin-operated telephones installed at
convenience store locations and for the sale of prepaid telephone cards. The
Company also made payments of $1,187,800 in fiscal year 2000 to TeleBeam for
discounted prepaid telephone cards and telephone service. Until its sale in
January 2000, the majority of the stock of TeleBeam was beneficially owned or
controlled by persons related to Henry D. Sahakian.
The Company made consulting fee and expense reimbursement payments of
$80,100 in fiscal year 2000 to Interconnect Enterprises, a petroleum industry
consulting firm owned by Gerold C. Shea.
Additional transactions with management and others are described under
"Compensation Committee Interlocks and Insider Participation." In management's
opinion, the TeleBeam and Interconnect Enterprises 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.
PRINCIPAL STOCKHOLDERS
The following table sets forth, as of December 28, 2000, 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 named executive officers
and (iii) all of the Directors and executive officers as a group. As of such
date, there were 7,038,522 shares of Common Stock outstanding.
<TABLE>
<CAPTION>
COMMON STOCK
BENEFICIAL OWNERSHIP (1)
-------------------------
NAME AND ADDRESS OF BENEFICIAL OWNER (2) SHARES PERCENTAGE
---------------------------------------- --------- ----------
<S> <C> <C>
Henry D. Sahakian........................................... 1,084,434(3) 15.2%
M. Michael Arjmand.......................................... 19,000(4) 0.3
Matthew R. Chandik.......................................... 0 0.0
Herbert C. Graves........................................... 49,000(5) 0.7
Stephen B. Krumholz......................................... 19,000(6) 0.3
Jack G. Najarian............................................ 14,055(7) 0.2
Frank R. Orloski, Sr........................................ 11,350 0.2
N. Gregory Petrick.......................................... 21,293(8) 0.3
Anthony S. Regensburg....................................... 14,055(9) 0.2
Daniel D. Sahakian.......................................... 1,124,373(10) 15.9
Gerold C. Shea.............................................. 21,500(11) 0.3
All Directors and Executive Officers as a Group (11
persons).................................................. 2,099,160 28.9
OAO LUKOIL, 11 Sretensky Boulevard, Moscow 101000 Russia.... 442,700 6.3
Dimensional Fund Advisors, Inc., 1299 Ocean Avenue, 11th
Floor, Santa Monica, CA 90401............................. 482,200 6.9
</TABLE>
12
<PAGE> 16
---------------
(1) Includes options to purchase Common Stock granted pursuant to the Company's
Equity Compensation Plan and 1996 Equity Compensation Plan exercisable
within 60 days.
(2) Except as noted, addresses of all beneficial owners listed are in care of
the Company at 477 East Beaver Avenue, State College, PA 16801.
(3) Includes 92,400 shares held by Henry D. Sahakian jointly with his wife,
35,500 shares owned by his wife, 64,394 shares held in the Savings Plan,
216,700 shares held by HFL Corporation, 62,200 shares held by Unico
Corporation, 5,000 shares held in his Individual Retirement Account, 3,000
shares held as custodian for his grandson and options to purchase 115,683
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. The
beneficial ownership in the table above also does not include 34,340 shares
held by his daughter and son-in-law for which he disclaims beneficial
ownership.
(4) Includes options to purchase 12,500 shares of Common Stock.
(5) Includes 30,000 shares held by the Graves Family Partnership and options to
purchase 12,500 shares of Common Stock.
(6) Includes options to purchase 12,500 shares of Common Stock.
(7) Includes options to purchase 8,500 shares of Common Stock.
(8) Includes 3,163 shares held in the Savings Plan and options to purchase
18,000 shares of Common Stock.
(9) Includes options to purchase 8,500 shares of Common Stock.
(10) Includes 216,700 shares held by HFL Corporation, 89,715 shares held as a
trustee for two trusts, 62,200 shares held by Unico Corporation and options
to purchase 23,000 shares of Common Stock.
(11) Includes options to purchase 12,500 shares of Common Stock.
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, 2000, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than ten-percent stockholders were complied with, except that Mr. Jack
G. Najarian inadvertently failed to timely file a report showing change in
ownership arising from receipt of Common Stock and stock options as part of his
annual director's retainer in February 2000.
13
<PAGE> 17
PROPOSAL II
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The firm of Deloitte & Touche LLP, Philadelphia, Pennsylvania, has acted as
the Company's independent auditors for the fiscal year ended September 30, 2000.
The Company intends to utilize the services of Deloitte & Touche LLP for the
fiscal year ending September 30, 2001. A member of that firm will be present at
the Annual Meeting to respond to appropriate questions from stockholders. He may
also make a statement. The Proxies intend to vote, unless instructed otherwise,
for the ratification of the appointment of the firm of Deloitte & Touche LLP.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE RATIFICATION OF THE
APPOINTMENT OF THE ABOVE-NAMED INDEPENDENT AUDITORS.
STOCKHOLDER PROPOSALS
Stockholders intending to submit proposals to be included in the Company's
next Proxy Statement must send their proposal to the Secretary of the Company at
477 East Beaver Avenue, State College, Pennsylvania, 16801-5690, not later than
September 28, 2001. Such proposals must relate to matters appropriate for
stockholder action and be consistent with regulations of the Securities and
Exchange Commission.
Stockholders intending to present proposals at the next annual meeting of
the Company and not intending to have such proposals included in the Company's
next Proxy Statement must send their proposal to the Secretary of the Company at
477 East Beaver Avenue, State College, Pennsylvania, 16801-5690, not later than
December 11, 2001. If notification of a stockholder proposal is not received by
such date, the Proxies may vote, in their discretion, any and all of the proxies
received in this solicitation against such proposal.
OTHER MATTERS
The Board of Directors is not aware of any other matters to be presented
for action, but, if any other matter properly comes before the Annual Meeting,
it is intended that the persons voting the accompanying proxy will vote the
shares represented thereby in accordance with their best judgment.
By Order of the Board of Directors,
/s/ Harry A. Martin
HARRY A. MARTIN
Secretary
State College, Pennsylvania
January 25, 2001
14
<PAGE> 18
APPENDIX A
AUDIT COMMITTEE CHARTER OF UNI-MARTS, INC.
This Audit Committee Charter has been adopted by the Board of Directors of
Uni-Marts, Inc. The audit committee shall review and reassess annually and
recommend any proposed changes.
ROLE AND INDEPENDENCE
The audit committee of the board of directors assists the board in
fulfilling its responsibility for the safeguarding of assets and oversight to
the quality and integrity of the accounting, auditing and reporting practices of
the corporation and such other duties as directed by the board. The membership
of the committee shall consist of at least three directors who are generally
knowledgeable in financial matters, including at least one member with
accounting, auditing or related financial management expertise. Each member
shall be free of any relationship that, in the opinion of the board, would
interfere with his or her individual exercise of independent judgement. The
committee is expected to maintain free and open communication (including private
executive sessions at least annually) with the independent accountant, the
internal auditors, and management of the corporation. In discharging this
oversight role, the committee is empowered to investigate any matter brought to
its attention, with full power to retain outside counsel or other experts for
this purpose. This charter shall be reviewed and updated annually.
RESPONSIBILITIES
The audit committee's primary responsibilities include:
- Primary input into the recommendation to the board for the selection and
retention of the independent accountant who audits the financial
statements of the corporation. In so doing, the committee will discuss
and consider the accounting firm's written affirmation that the firm is
in fact independent, will discuss the nature and rigor of the audit
process, receive and review all appropriate reports and will provide to
the independent accountant full access to the committee (and the board)
to report on any and all matters appropriate.
- Provision of guidance and oversight to the internal audit function of the
corporation including review of the internal audit organization, plans
and results of such activity.
- Review of quarterly and annual financial statements with management and
the independent accountant. It is anticipated that these discussions will
include quality of earnings, discussions of significant items subject to
estimate, consideration of the suitability and changes of accounting
principles, review of highly judgmental areas, audit adjustments whether
or not recorded and such other inquiries as may be appropriate.
- Discussion with management and the independent accountant of the quality
and adequacy of the company's internal controls.
- Discussion with management of the status of material pending litigation,
tax issues and other areas of oversight to the legal and compliance area
as may be appropriate.
- Reporting on audit committee activities to the full board and issuance
annually of a summary report (including appropriate oversight
conclusions) suitable for submission to the shareholders.
15
<PAGE> 19
Please mark
your vote as indicated
in this example [ ]
1. ELECTION OF CLASS II DIRECTORS Stephen B. Krumholz, Jack G. Najarian,
Anthony S. Regensburg
FOR ALL NOMINEES WITHHOLD AUTHORITY
LISTED ABOVE TO VOTE FOR (Instruction: To withhold authority
(Except as marked to ALL NOMINEES to vote for any nominee, write that
the contrary) LISTED ABOVE nominee's name on the line below.)
[ ] [ ] ___________________________________
2. PROPOSAL TO RATIFY THE APPOINTMENT OF DELOITTE & TOUCHE LLP AS THE
COMPANY'S INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING SEPTEMBER 30,
2001.
FOR AGAINST ABSTAIN
[ ] [ ] [ ] Date: ____________________________, 2001
________________________________________
________________________________________
Signature(s)
IMPORTANT: Please sign your name or
names exactly as printed on this proxy.
When signing as attorney, executor,
administrator, trustee or guardian, give
title as such.
FOLD AND DETACH HERE
[UNI-MART LOGO]
ADMISSION TICKET
2001 ANNUAL MEETING OF STOCKHOLDERS
Thursday, February 22, 2001
10:00 AM
Penn Stater Conference Center Hotel
215 Innovation Boulevard
State College, PA 16803
THIS TICKET, OR OTHER EVIDENCE OF STOCK OWNERSHIP, MUST BE PRESENTED
TO ENTER THE MEETING.
ADMITS STOCKHOLDER(S) OR THEIR DULY APPOINTED PROXY(IES)
<PAGE> 20
UNI-MARTS, INC.
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF STOCKHOLDERS ON FEBRUARY 22, 2001 AND ANY ADJOURNMENT THEREOF.
This Proxy when properly executed will be voted as specified on the
reverse side hereof. If no specific direction is given, it will be voted for the
election of Directors and for the ratification of the appointment of the
independent auditors.
The undersigned appoints Henry D. Sahakian and N. Gregory Petrick, or
any one or more of them acting in the absence of others, Proxies, each with full
power of substitution, to vote all shares of Common Stock of the Company which
the undersigned would be entitled to vote if personally present at the Annual
Meeting of Stockholders of the Company to be held on Thursday, February 22,
2001, at 10:00 AM, and any adjournment thereof, as set forth on the reverse
hereof.
(CONTINUED AND TO BE DATED AND SIGNED ON THE REVERSE SIDE)
FOLD AND DETACH HERE
