<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
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
FOODMAKER, INC.
(Name of Registrant as Specified in Its Charter)
FOODMAKER, INC.
(Name of Person(s) Filing Proxy Statement)
Paying of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee 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>
FOODMAKER
January 9, 1998
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders
of Foodmaker, Inc. to be held at 2:00 p.m. on Friday, February 13, 1998, at
the San Diego Princess Resort, 1404 West Vacation Road, San Diego, California.
We hope you will attend in person. If you plan to do so, please indicate
in the space provided on the enclosed proxy. Whether you plan to attend the
meeting or not, we urge you to sign, date and return the enclosed proxy as
soon as possible in the postage-paid envelope provided or, if indicated on
your proxy card, to optionally vote your proxy by telephone. This will ensure
representation of your shares in the event that you are unable to attend the
meeting.
The matters expected to be acted upon at the meeting are described in
detail in the attached Notice of Meeting and Proxy Statement.
The Directors and Officers of the Company look forward to meeting with
you.
Sincerely,
JACK W. GOODALL
Jack W. Goodall
Chairman of the Board
<PAGE>
FOODMAKER, INC.
9330 Balboa Avenue
San Diego, California 92123
____________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on February 13, 1998
The Annual Meeting of Stockholders of Foodmaker, Inc. will be held at
2:00 p.m. on Friday, February 13, 1998, at the San Diego Princess Resort,
1404 West Vacation Road, San Diego, California.
The meeting will be held to vote upon the following proposals:
1. To elect eight directors to serve until the next Annual
Meeting of Stockholders and until their successors are
elected and qualified;
2. To ratify the appointment of KPMG Peat Marwick LLP as
independent accountants; and
3. To act upon such other matters as may properly come
before the meeting or any postponements or adjournments
thereof.
Only stockholders of record at the close of business on December 26,
1997, will be entitled to vote at the meeting.
By Order of the Board of Directors
LAWRENCE E. SCHAUF
Lawrence E. Schauf, Secretary
San Diego, California
January 9, 1998
<PAGE>
FOODMAKER, INC.
9330 Balboa Avenue
San Diego, California 92123
____________________
PROXY STATEMENT
____________________
ANNUAL MEETING OF STOCKHOLDERS
February 13, 1998
SOLICITATION OF PROXIES
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Foodmaker, Inc., a Delaware corporation
("Foodmaker" or the "Company"), for use at the Annual Meeting of Stockholders
(the "Meeting") to be held at 2:00 p.m. on Friday, February 13, 1998, at the
San Diego Princess Resort, 1404 West Vacation Road, San Diego, California,
and all adjournments and postponements thereof. This Proxy Statement and
form of proxy were mailed to stockholders on or about January 9, 1998.
The cost of preparing, assembling and mailing the Notice of Annual
Meeting of Stockholders, Proxy Statement and form of proxy and the
solicitation of proxies will be paid by Foodmaker. The Company has engaged
D.F. King & Co., Inc. ("D.F. King") to assist in the solicitation of proxies,
for which D.F. King will be paid a fee not to exceed $4,500 plus out-of-
pocket expenses. In addition to solicitation by mail, proxies may be
solicited personally or by telephone or other means by D.F. King, as well as
by directors, officers or employees of the Company, who will receive no
additional compensation for such services.
VOTING
The close of business on December 26, 1997 has been fixed as the record
date for the determination of stockholders entitled to notice of and to vote
at the Meeting. On that date, there were 39,151,145 shares of Foodmaker
common stock, $.01 par value (the "Common Stock"), outstanding. Each share
is entitled to one vote on any matter that may be presented for consideration
and action by the stockholders.
The presence, in person or by proxy, of the holders of at least a
majority of the total number of shares of Common Stock entitled to vote is
necessary to constitute a quorum at the Annual Meeting. Abstentions and
broker non-votes (i.e., shares held by brokers or nominees that the broker or
nominee does not have discretionary power to vote on a particular matter and
as to which instructions have not been received from the beneficial owners or
persons entitled to vote) are counted for the purpose of determining the
presence or absence of a quorum for the transaction of business. In the
event that there are insufficient votes for a quorum at the time of the
Annual Meeting, the Annual Meeting may be adjourned in order to permit the
further solicitation of proxies.
A director will be elected by a plurality of the votes of the shares of
Common Stock present in person or represented by proxy. The affirmative vote
of a majority of the shares of Common Stock present in person or represented
by proxy will be required to ratify the appointment of KPMG Peat Marwick LLP
as independent accountants of the Company for the 1998 fiscal year.
With regard to the election of directors, votes may be cast in favor or
withheld. Votes that are withheld will be excluded entirely from the vote
and will have no effect. Abstentions may be specified on all proposals other
than the election of directors and will be counted as present for purposes of
the item on which the abstention is voted.
<PAGE>
Therefore such abstentions will have the effect of a negative vote. Broker
non-votes are not counted for purposes of determining whether a proposal has
been approved and, therefore, have the effect of reducing the number of
affirmative votes required to achieve a majority of the votes cast for such
proposal.
Proxies will be voted as directed in writing or by telephone. If no
direction is given, proxies will be voted FOR management's nominees for
election as directors and FOR Proposal 2, unless the stockholder otherwise
directs in the proxy. The enclosed proxy gives discretionary authority as to
any matters not specifically referred to therein. See "Other Business". The
telephone voting procedures, available only to stockholders of record, are
designed to authenticate stockholders' identities, to allow record
stockholders to vote their shares and to confirm that their instructions have
been properly recorded. Specific instructions to be followed by any record
stockholder interested in voting via telephone are set forth on the enclosed
proxy card. A proxy may be revoked at any time before it is voted at the
Meeting by submitting written notice of revocation to the Secretary of
Foodmaker, by filing a duly executed written proxy bearing a later date or,
for record stockholders, by a later proxy delivered using the telephone
voting procedures. A proxy will not be voted if the stockholder who executed
it or voted it by telephone is present at the Meeting and elects to vote the
shares represented thereby in person.
PROPOSAL ONE
ELECTION OF DIRECTORS
The directors of Foodmaker are elected annually. The term of office of
all present directors expires on the date of the Meeting, at which time eight
directors are to be elected to serve for the ensuing year and until their
successors are elected and qualified. The nominees of management for
election as directors are set forth below along with certain information
regarding these nominees. Should any nominee become unavailable to serve as
a director, the proxies will be voted for such other person as the Board of
Directors shall designate. To the best of Foodmaker's knowledge, all
nominees are and will be available to serve. Stockholders' nominations for
election as a director may be made only pursuant to the provisions of the
Company's bylaws, described below under "Other Business".
The following table provides certain information about each of the
Company's nominees for director as of January 1, 1998:
Director
Name Age Positions with the Company Since
- -----------------------------------------------------------------------------
Michael E. Alpert(6) 55 Director 1992
Jay W. Brown(2)(3) 52 Director 1997
Paul T. Carter(2)(3)(5) 75 Director 1991
Charles W. Duddles(1) 57 Executive Vice President, 1988
Chief Financial Officer, Chief
Administrative Officer and Director
Edward Gibbons(3)(4)(6) 61 Director 1985
Jack W. Goodall(1)(4)(5)(6) 59 Chairman of the Board 1985
Robert J. Nugent(1)(4) 56 President, Chief Executive
Officer and Director 1988
L. Robert Payne(2)(5) 64 Director 1986
__________________________
(1) Member of the Administrative Committee.
(2) Member of the Audit Committee.
(3) Member of the Compensation Committee.
(4) Member of the Executive Committee.
(5) Member of the Finance Committee.
(6) Member of the Nominating Committee.
2
<PAGE>
The business experience, principal occupations and the employment of the
nominees has been as follows:
Mr. Alpert was a partner in the San Diego Office of the law firm of
Gibson, Dunn & Crutcher LLP for more than 5 years prior to his retirement on
August 1, 1992. He is currently Advisory Counsel to Gibson, Dunn & Crutcher
LLP. Gibson, Dunn & Crutcher LLP provides legal services to the Company from
time to time.
Since 1995, Mr. Brown has been President and CEO of Protein Technologies
International, Inc., the world's leading supplier of soy-based proteins to
the food and paper processing industries. He was Chairman and CEO of
Continental Baking Company from October 1984 to July 1995 and President of
Van Camp Seafood Company from August 1983 to October 1984. From July 1981
through July 1983, he served as Vice President of Marketing for
Jack in the Box.
Mr. Carter has been an insurance consultant for the Government Division
of Corroon & Black Corporation since February 1987. From February 1987 until
December 1990, he was also a consultant to the San Diego Unified School
District on insurance matters. He retired in February 1987 as Chairman and
Chief Executive Officer of Corroon & Black Corporation, Southwestern Region
and as Director and Senior Vice President of Corroon & Black Corporation, New
York. Mr. Carter is a director of Borrego Springs National Bank.
Mr. Duddles has been Executive Vice President and Chief Administrative
Officer of the Company since May 1988. He has been Chief Financial Officer
of the Company since October 1985 and was Senior Vice President from October
1985 to May 1988. Mr. Duddles has 18 years of experience with the Company in
various finance positions.
Mr. Gibbons has been a general partner of Gibbons, Goodwin, van
Amerongen ("GGvA"), an investment banking firm, for more than five years
preceding the date hereof. Mr. Gibbons is also a director of Robert Half
International, Inc.
Mr. Goodall has been Chairman of the Board since October 1985. For more
than five years prior to his retirement in April 1996, he was President and
Chief Executive Officer of the Company. Mr. Goodall is a director of Ralcorp
Holdings, Inc.
Mr. Nugent has been President and Chief Executive Officer of the Company
since April 1996. He was Executive Vice President of the Company from
February 1985 to April 1996 and President and Chief Operating Officer of the
Jack in the Box Division of the Company from May 1988 to April 1996. Mr.
Nugent has 18 years of experience with the Company in various executive and
operations positions.
Mr. Payne has been President and Chief Executive Officer of
Multi-Ventures, Inc. since February 1976 and was Chairman of the Board of
Grossmont Bank, a wholly-owned subsidiary of Bancomer, S.A., from February
1974 until October 1995. Multi-Ventures, Inc. is a real estate development
and investment company that is also the managing partner of the San Diego
Mission Valley Hilton and the Hanalei Hotel. He was a principal in the
Company prior to its acquisition by its former parent, Ralston Purina
Company, in 1968.
INFORMATION ABOUT THE BOARD OF DIRECTORS
AND CERTAIN COMMITTEES OF THE BOARD
The following information is provided about the Board of Directors and
certain of its committees.
The Audit Committee, currently consisting of Messrs. Brown, Carter and
Payne, directs the internal and external audit activities of Foodmaker as
deemed appropriate. The Audit Committee held two meetings in 1997.
The Compensation Committee, currently consisting of Messrs. Brown, Carter
and Gibbons, reviews compensation policies and recommends changes when
appropriate. The Compensation Committee held two meetings in 1997 and granted
stock options on three occasions by unanimous written consents.
3
<PAGE>
The Nominating Committee, consisting of Messrs. Alpert, Gibbons and
Goodall, recommends to the Board nominees for election as Directors and will
consider nominees properly submitted by stockholders (see "Other Business") .
The Nominating Committee held no meetings in 1997.
In 1997, the Board of Directors held six meetings and on one occasion
acted by unanimous written consent. Each current director attended more than
75% of the aggregate of the general meetings and the meetings of committees
on which such director served.
Directors who are also officers of Foodmaker or its subsidiaries receive
no additional compensation for their services as directors. Mr. Goodall, who
continues to provide ongoing consultation on various matters, receives
compensation of $10,000 per month as Chairman of the Board of Directors. The
other independent directors of the Company receive compensation consisting of
an $18,000 annual retainer, $2,000 ($1,500 through February 14, 1997) for
each Board of Directors' meeting attended in person and are also reimbursed
for out-of-pocket and travel expenses. No additional compensation is paid
for actions taken by the Board of Directors by written consent or
participating in telephonic meetings. Under the Company's Deferred
Compensation Plan for Non-Management Directors, each independent director may
defer any portion or all of such compensation. Amounts deferred under the
plan's equity option are immediately converted to stock equivalents at the
then current market price of the Company's common stock and matched at a 25%
rate by the Company. A director's stock equivalent account is distributed in
cash, based upon the ending number of stock equivalents and the market value
of the Company's common stock, at the conclusion of the director's service as
a member of the Board of Directors. All of the independent directors have
elected to defer their compensation pursuant to this plan.
Pursuant to the Company's Non-Employee Director Stock Option Plan,
commencing February 17, 1995 and annually thereafter upon election to the
Board, each independent director also receives a stock option to purchase
10,000 shares of the Company's common stock at the market value, as defined,
on the date of grant.
Additionally, the Company paid Mr. Carter $7,500 in fiscal 1997 for
consultation services relating to insurance matters. The Company has not
renewed this arrangement for 1998. No additional compensation is paid to
other members of the Board of Directors.
4
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth, as of December 15, 1997, information
with respect to beneficial ownership of voting securities of the Company by
(i) each person who is known to the Company to be the beneficial owner of
more than 5% of any class of the Company's voting securities, (ii) each
director and nominee for director of the Company, (iii) each executive
officer listed in the Summary Compensation Table herein and (iv) all
directors and executive officers of the Company as a group. Each of the
following stockholders has sole voting and investment power with respect to
shares beneficially owned by such stockholder, except to the extent that
authority is shared with spouses under applicable law or as otherwise noted.
Number of Shares
of Common Stock
Name Beneficially Owned(1) Percent of Class(1)
- ---------------------------------- --------------------- -------------------
Morgan Stanley, Dean Witter,
Discover & Co. (2). . . . . . . . 4,415,094 11.3%
Jack W. Goodall . . . . . . . . . . 1,078,873 2.7%
Robert J. Nugent. . . . . . . . . . 717,271 1.8%
Charles W. Duddles. . . . . . . . . 490,693 1.3%
Kenneth R. Williams . . . . . . . . 437,156 1.1%
Edward Gibbons(3) . . . . . . . . . 394,736 1.0%
Paul L. Schultz . . . . . . . . . . 183,070 *
L. Robert Payne . . . . . . . . . . 91,000 *
Paul T. Carter. . . . . . . . . . . 48,750 *
Michael E. Alpert . . . . . . . . . 31,500 *
Lawrence E. Schauf. . . . . . . . . 27,500 *
Jay W. Brown. . . . . . . . . . . . 20,000 *
All directors and executive officers
as a group (20 persons). . . . . . 3,913,517 9.7%
_________________________
* Less than one percent
(1) For purposes of this table, a person or group of persons is deemed to
have "beneficial ownership" of any shares as of a given date which such
person has the right to acquire within 60 days after such date. For
purposes of computing the percentage of outstanding shares held by each
person or group of persons named above on a given date, any security which
such person or persons has the right to acquire within 60 days after such
date is deemed to be outstanding, but is not deemed to be outstanding for
the purpose of computing the percentage ownership of any other person.
Messrs. Goodall, Nugent, Duddles, Williams, Gibbons, Schultz, Payne,
Carter, Alpert, Schauf and Brown have the right to acquire through the
exercise of stock options within 60 days of the above date, 395,000,
212,500, 140,000, 156,500, 30,000, 87,000, 66,000, 36,750, 30,000,
25,000 and 10,000, respectively, of the shares reflected above as
beneficially owned.
(2) According to its Schedule 13G filing, Morgan Stanley, Dean Witter,
Discover & Co., exercised as of November 6, 1997, investment discretion
with respect to 4,415,094 shares, of which, 2,446,550 are held on a
discretionary basis on behalf of clients by Morgan Stanley & Co., its
wholly-owned subsidiary. All shares held are with shared voting power.
The address of Morgan Stanley, Dean Witter, Discover & Company and
Morgan Stanley & Co. is 1585 Broadway, New York, New York 10036.
(3) Includes 50,000 shares owned by Mr. Gibbons' wife.
5
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth information concerning the annual and
long-term compensation of the Company's chief executive officer and the other
four most highly compensated executive officers of the Company for services
in all capacities to the Company and its subsidiaries during the fiscal years
indicated. Bonus amounts were accrued during the year and paid shortly
thereafter.
<TABLE>
<CAPTION>
Securities All
Other
-------Annual Compensation-------- Underlying
Compensa-
Name and Principal Position Year Salary($) Bonus($) Other($)
Options(#) tion ($)(F1)
- ------------------------------------- ---- --------- -------- -------- ---------- -----------
<S> <C> <C> <C> <C>
<C> <C>
Robert J. Nugent 1997 467,500 500,000 32,497 50,000
13,823
President, Chief Executive Officer 1996 408,685 435,000 6,000
25,000 10,628
and Director 1995 382,370 70,000 789 --
5,168
Kenneth R. Williams 1997 330,000 280,000 12,000 25,000
18,638
Executive Vice President, 1996 296,185 248,000 6,000 13,000
19,214
Marketing and Operations 1995 282,370 40,625 1,616 25,000
9,815
Charles W. Duddles 1997 305,000 248,000 16,270 25,000
17,682
Executive Vice President, Chief
Financial Officer, Chief 1996 291,185 240,000 6,000 10,000
19,105
Administrative Officer 1995 282,370 50,000 515 --
9,815
and Director
Lawrence E. Schauf (F2) 1997 250,000 200,000 19,034
25,000 8,796
Executive Vice President, Secretary 1996 28,846 -- 1,385 50,000
577
Paul L. Schultz 1997 242,500 169,000 12,000 20,000
12,952
Vice President, Operations 1996 216,586 146,250 6,000 9,000
13,246
1995 208,171 29,250 1,747 22,500
7,277
- ------------------------------------------------
<FN>
<F1> All other compensation represents the Company's matching contributions
to the deferred compensation plan, except for approximately $1,300
annually for each person (except Mr. Schauf in 1996) for premiums on
term life insurance paid by the Company for the benefit of the named
executive officer. The Company has no interest in such insurance
policies.
<F2> Mr. Schauf began his employment with the Company on August 19, 1996.
</FN>
</TABLE>
Stock Option Grants in Fiscal 1997
Set forth below is information with respect to options granted to the
named executive officers in the Summary Compensation Table during the 1997
fiscal year.
<TABLE>
<CAPTION>
Potential Realizable Value
at Assumed Annual Rates
Number of % of Total of Stock Price
Securities Options/SARs Appreciation For
Underlying Granted to Exercise or Option Term
Options/SARs Employees Base Price Expiration
- ----------------------------
Name Granted (#) in Fiscal Year ($/Share) Date 5%
10%
- ------------------- ------------ -------------- ----------- ---------- ------- --------
<S> <C> <C> <C> <C> <C>
<C>
Robert J. Nugent 50,000 6.7% 12.125 6/9/2007 $385,368
$978,987
Kenneth R. Williams 25,000 3.3% 12.125 6/9/2007 192,684
489,493
Charles W. Duddles 25,000 3.3% 12.125 6/9/2007 192,684
489,493
Lawrence E. Schauf 25,000 3.3% 12.125 6/9/2007 192,684
489,493
Paul L. Schultz 20,000 2.7% 12.125 6/9/2007 154,147
391,595
</TABLE>
6
<PAGE>
Option Exercises in Fiscal 1997 and Fiscal Year-End Values
Set forth below is information with respect to options exercised by the
named executive officers in the Summary Compensation Table during the 1997
fiscal year, and the number and value of unexercised stock options held by
the named executive officers at the end of the fiscal year.
<TABLE>
<CAPTION>
Number of
Securities Underlying
Unexercised Value of Unexercised
Options/SARs Held at In-the-Money
Options/SARs
Shares Fiscal Year-End at Fiscal
Year-End(F1)
Acquired on Value ---------------------------- ----------------------------
Name Exercise(#) Realized Exercisable Unexercisable Exercisable
Unexercisable
- ------------------- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C>
<C>
Robert J. Nugent 0 $0 212,500 62,500 $2,916,616
$511,719
Kenneth R. Williams 0 0 156,500 31,500 2,088,044
258,906
Charles W. Duddles 0 0 140,000 30,000 2,037,739
240,625
Lawrence E. Schauf 0 0 25,000 50,000 254,688
434,375
Paul L. Schultz 0 0 83,666 27,834 1,065,961
241,311
- --------------------------
<FN>
<F1> Based on the difference between the exercise price of the options and
the closing price of the Company's common stock on the last trading day
prior to the Company's fiscal year ended September 28, 1997.
</FN>
</TABLE>
Report of the Board of Directors and Compensation Committee on Executive
Compensation
The Board of Directors has the primary responsibility for determining
executive compensation. In addition, there is also a Compensation Committee
composed of not less than two non-employee directors. Executive compensation
is designed to (a) provide compensation opportunities that will attract,
motivate and retain highly qualified managers and executives, and (b) provide
salary and other rewards that are closely linked to Company, team, and
individual performance, focused on achievement of annual business plans and
longer term incentives linked to increases in stockholder value. The Chief
Executive Officer recommends the compensation to be paid to executive
officers of the Company other than himself; final determination of the amount
of compensation rests with the non-employee members of the Board of
Directors. Board members who are also executive officers do not participate
in discussions about, nor do they vote on, recommendations concerning their
respective compensation.
The Company's executive officer compensation program is comprised of base
salary, bonus opportunity, long-term incentive compensation in the form of
stock options, and other benefits such as health insurance. It is the
objective of the Company to maintain base salaries that are slightly above
the mid-range of compensation paid to senior executives with comparable
qualifications, experience and responsibilities at other companies engaged in
the same or similar business as the Company. The Performance Bonus Plan
provides for a bonus as a percent of base salary which is dependent upon the
Company's performance level achieved and the job classification of the
individual. The purpose of the Performance Bonus Plan is to reward key
employees, executives and officers for achievement of corporate goals
relating to earnings. The performance bonuses for the named executives for
fiscal 1997 were paid in accordance with the established plan and are
reflected in the Summary Compensation Table.
The 1992 Employee Stock Incentive Plan forms the basis for the Company's
long-term incentive plan for officers and key managers. The purpose of the
Plan is to enable the Company and its subsidiaries to attract, retain and
motivate employees by providing for or increasing the proprietary interests
of such employees in the Company. During 1997, stock options were granted to
Messrs. Nugent, Williams, Duddles, Schauf and Schultz for the purchase of
50,000, 25,000, 25,000, 25,000 and 20,000 shares, respectively, of Common
Stock at $12.125 per share, exercisable 50% on each of May 9, 1998 and May 9,
1999. All options were granted at 100% of the market price of the Company's
common stock on the dates of grant. Options serve to directly align the
interests of executives, including the Chief Executive Officer, with the
interests of other shareholders, since such executives will not realize a
benefit unless and until the market price of the Company's common stock
increases.
7
<PAGE>
Mr. Nugent became the Chief Executive Officer of the Company on April 1,
1996. His base salary as of March 31, 1997, was increased 15% over his
previous base salary in order to maintain his salary at approximately the
mid-range of competitive industry practice. An annual cash incentive award
is payable to Mr. Nugent if the Company achieves or exceeds specified
earnings goals. Mr. Nugent's bonus for 1997 reflects the highest performance
rating under the Foodmaker Performance Bonus Plan. In 1997, approximately
one-half of Mr. Nugent's compensation was incentive pay.
This report is submitted by the Board of Directors and the Compensation
Committee.
Board of Directors Compensation Committee
----------------------------------------- ----------------------
Michael E. Alpert Edward Gibbons Jay W. Brown
Jay W. Brown Jack W. Goodall Paul T. Carter
Paul T. Carter Robert J. Nugent Edward Gibbons
Charles W. Duddles L. Robert Payne
This report will not be deemed to be incorporated by reference in any
filing by the Company under the Securities Act of 1933 or the Securities
Exchange Act of 1934, except to the extent that the Company specifically
incorporates this report by reference.
Compensation Committee Interlocks and Insider Participation
The members of the Compensation Committee are currently Jay W. Brown,
Paul T. Carter and Edward Gibbons. Jay W. Brown, who was Vice President of
the Company from July 1981 to July 1983, participated in the deliberations of
the committee. In addition, Mr. Goodall, formerly Chief Executive Officer of
the Company, was a member of the Compensation Committee during a portion of
fiscal year 1997 and participated in the deliberations of the committee
during such time.
Pension Table
Retirement Plan. The Company maintains a retirement plan (the
"Retirement Plan"), which was adopted effective October 21, 1985 and restated
effective as of January 1, 1989. The Retirement Plan is a defined benefit
plan covering eligible regular employees employed in an administrative,
clerical, or restaurant hourly capacity who have completed 1,000 Hours of
Service and reached age 21. The Retirement Plan provides that a participant
retiring at age 65 will receive an annual retirement benefit equal in amount
to one percent of Final Average Pay multiplied by Benefit Service plus .4% of
Final Average Pay in excess of Covered Compensation multiplied by Benefit
Service, subject to grandfathered minimum benefit accruals under the previous
plan as of December 31, 1988. The .4% portion of the calculation is limited
to a maximum of 35 years of service. The Employee Retirement Income Security
Act of 1974 ("ERISA") and various tax laws may cause a reduction in the
annual retirement benefit payable under the Retirement Plan. (The preceding
capitalized terms are defined in the Retirement Plan, a copy of which is
filed as an exhibit to the Company's Annual Report on Form 10-K.)
Although normal retirement is age 65, benefits may begin as early as age
55 if service requirements defined in the Retirement Plan are met. Benefits
payable are reduced for early commencement.
Supplemental Retirement Plan. The Company established a non-qualified
supplemental retirement plan for selected executives effective April 2, 1990,
known as the Supplemental Executive Retirement Plan. The plan provides for a
percentage of replacement income based on Service and Final Average
Compensation (each as defined in the plan). The target replacement income
from all Company funded sources based upon a maximum of 20 full years of
service is 60% of Final Average Compensation. For those executives whose
service lengths are less than 20 years, the target percentage of 60% is
reduced by applying a factor determined by dividing the number of full years
of actual service by 20. The plan is unfunded and represents an unsecured
claim against the Company.
Easy$aver Plus Plan. Effective October 21, 1985, the Company adopted the
Foodmaker Savings Investment Plan, currently named the Foodmaker Easy$aver
Plus Plan (the "E$P"), which includes a cash-or-deferred arrangement under
Section 401(k) of the Internal Revenue Code. Eligible regular full-time
employees who have completed at least one year of service and reached age 21
8
<PAGE>
qualify for the E$P. Participants in the E$P may defer up to 12% of their pay
on a pre-tax basis. In addition, the Company contributes on a participant's
behalf an amount equal to 50% of the first 4% of compensation that is deferred
by the participant.
Deferred Compensation Plan. Since January 1, 1989, all executive
officers and certain other members of management of the Company have been
excluded from participation in the E$P. Effective April 2, 1990, all such
persons were offered an opportunity to participate in a non-qualified
deferred compensation plan established by the Company. Participants of the
plan, known as the Capital Accumulation Plan for Executives, may defer up to
15% of base and/or bonus pay. The Company contributes on a participant's
behalf 100% of the first 3% of compensation that is deferred by the
participant. Benefits paid under such plan also include an interest
component based on Moody's Average Corporate Bond Yield Index. The plan is
unfunded and participants' accounts represent unsecured claims against the
Company.
Summary of Retirement and Other Deferred Benefits. The following table
shows estimated annual benefits payable to participants as a straight life
annuity. The benefits are derived from some or all of the following Company
funded sources: Retirement Plan, Company contributions to the E$P, Company
contributions to the Deferred Compensation Plan, Supplemental Retirement Plan
and Social Security (50% of primary insurance amount).
Estimated Annual Benefits Based on Years of Service
---------------------------------------------------
Average Annual
Earnings 10 15 20
- -------------- -------- -------- --------
$ 100,000 . . . . . . . $ 30,000 $ 45,000 $ 60,000
200,000 . . . . . . . 60,000 90,000 120,000
300,000 . . . . . . . 90,000 135,000 180,000
400,000 . . . . . . . 120,000 180,000 240,000
500,000 . . . . . . . 150,000 225,000 300,000
600,000 . . . . . . . 180,000 270,000 360,000
800,000 . . . . . . . 240,000 360,000 480,000
1,000,000 . . . . . . . 300,000 450,000 600,000
1,200,000 . . . . . . . 360,000 540,000 720,000
At September 28, 1997, the number of years of service under the
retirement plans for Messrs. Nugent, Williams, Duddles, Schauf and Schultz
was 18, 27, 24, 1 and 22, respectively; and the amount of eligible
compensation for each of these individuals approximates the amounts reflected
as salary and bonus in the Summary Compensation Table.
Severance Arrangements
The Company has entered into compensation and benefits assurance
agreements with certain of its senior executives, including Messrs. Nugent,
Williams, Duddles, Schauf and Schultz, for the payment of certain
compensation and the provision for certain benefits in the event of
termination of employment following a change in control of the Company. The
agreements continue in effect through September 29, 1998 and are
automatically extended for additional, successive, two-year terms thereafter
unless at least six-months written notice is given to the contrary. If there
is a change of control (as defined in the agreements) during the term of any
such agreement, the executive will be entitled to receive the payments and
benefits specified in the event that his employment is terminated within 24
months thereafter: (i) involuntarily, without cause or (ii) voluntarily for
"good reason" (as defined in the agreements). Amounts payable under each
agreement include all amounts earned by the employee prior to the date of
termination and a multiple of the employee's annual base salary, bonus and
the Company's matching contributions to the deferred compensation plan. In
the case of Messrs. Nugent, Williams, Duddles, Schauf and Schultz, the
applicable multiples are 2.5, 2.5, 2.5, 2.5 and 1.5, respectively. In
addition, the agreements provide for the continuation of health insurance
benefits for a period of up to 18 months following termination and certain
incidental benefits.
9
<PAGE>
CERTAIN TRANSACTIONS
In 1990, a wholly-owned subsidiary of the Company entered into a master
license agreement with Foodmex, Inc., a Nevada corporation, for the
development and operation of Jack in the Box restaurants in Mexico. In
connection with the master license agreement in 1990, the stockholders of
Foodmex provided personal guarantees of Foodmex's obligations to the
Company's subsidiary. In 1993, Foodmex and the Company's subsidiary modified
and amended their agreement. Subsequently, as the result of severe financial
difficulties encountered by Foodmex, it became unable to meet its obligations
on a current basis. Therefore, Foodmex was required to pay in advance for
its food and supplies purchased from the Company and entered into an
agreement for the payment, over an extended period without interest, of the
accumulated arrearage.
In December 1996, the Company's subsidiary terminated its franchise
agreement with Foodmex; and Foodmex filed a lawsuit in Federal Court,
Foodmex, Inc. v. Foodmaker International Franchising Inc., et al., against
the Company, its subsidiary, Jack W. Goodall, Robert J. Nugent and another
employee of the Company. As amended, the complaint alleges claims for breach
of contract, breach of the implied covenant of good faith and fair dealing,
fraud, tortious interference with contract relations, violation of the
California Franchise Relations Act, Racketeer Influenced and Corrupt
Organization Act and civil conspiracy. The amended complaint seeks monetary
damages in excess of $10 million and punitive damages. A counterclaim was
filed by the Company and its subsidiary alleging claims based on breach of
contract, trademark infringement, unfair competition and false designation of
origin. The counterclaim seeks injunctive relief and monetary damages,
including payment of over $1 million owing to the Company's subsidiary.
In March 1997, the Court granted the Company's subsidiary's motion for
preliminary injunction. In granting the motion, the Court found that the
Company's subsidiary has a likelihood of success on the merits of its breach
of contract and trademark infringement claims and required Foodmex to comply
with the termination provisions of its agreement, including the removal of
all Jack in the Box signs and discontinuance of all further use of Jack in the
Box trademarks. In June 1997, Foodmex and its president were found in contempt
of court for failing to comply with the preliminary injunction.
In April 1997, the Company's subsidiary filed an action in the Superior
Court for San Diego, Foodmaker International Franchising, Inc. v. Weber et.
al., against certain of the stockholders of Foodmex, seeking to enforce
guarantee of Foodmex's obligations to the Company.
Sharon Payne, who is the daughter of L. Robert Payne, a director of the
Company, acquired 25% of the outstanding common stock of Foodmex in 1990,
loaned certain funds to Foodmex and signed a guarantee of Foodmex's
obligations to the Company's subsidiary, similar in substance to that
provided by the other Foodmex stockholders. The Company has been advised
that it is the position of Ms. Payne that her personal guarantee is no longer
of any legal effect as the result of changes made to the agreements between
Foodmex and the Company's subsidiary subsequent to the making of her
guarantee. Ms. Payne is not a defendant in the Weber lawsuit.
The Company has been advised by Mr. Payne that the majority of the funds
invested by his daughter in Foodmex (including her loans to Foodmex) were
loaned to her by him. In addition, Mr. Payne has advised that in the past
he, his wife and a family trust provided guarantees of, and certain
collateral for, Foodmex's bank indebtedness, the maximum amount of which was
approximately $760,000, and which is currently $69,200. Mr. Payne has never
guaranteed any of Foodmex's obligations to the Company's subsidiary. Mr.
Payne has also advised the Company that in December 1995 all of the ownership
interest formerly held by his daughter in Foodmex was transferred to other
stockholders of Foodmex; and that neither he nor his daughter presently holds
any ownership interest in Foodmex.
10
<PAGE>
PERFORMANCE GRAPH
The following graph compares the cumulative return to holders of the
Company's Common Stock at September 30th of each year with a Restaurant Peer
Group Index and the Standard & Poor's ("S&P") 500 Index for the same period.
The comparison assumes $100 was invested on September 30, 1992 in the
Company's Common Stock and in each of the comparison groups, and assumes
reinvestment of dividends. The Company paid no dividends during the periods.
[A LINE GRAPH CHART WAS INCLUDED HEREIN WHICH
GRAPHICALLY REFLECTED THE FOLLOWING DATA]
1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ----
Foodmaker, Inc. 100 96 55 55 96 181
Restaurant PeerGroup(1) 100 116 102 102 107 134
S&P 500 Index 100 113 117 152 183 257
- --------------
(1) The Restaurant Peer Group Index is comprised of the following
companies: Bob Evans Farms, Inc.; CKE Restaurants, Inc.; International
Dairy Queen; Luby's Cafeterias, Inc.; Perkins Family Restaurants, L.P.;
Ryan's Family Steak Houses, Inc.; Sbarro, Inc.; Shoney's, Inc.; and
Vicorp Restaurants, Inc.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Pursuant to Section 16(a) of the Securities Exchange Act of 1934, each
executive officer, director and beneficial owner of more than 10% of the
Company's Common Stock is required to file certain forms with the Securities
and Exchange Commission. A report of beneficial ownership of the Company's
Common Stock on Form 3 is due at the time such person becomes subject to the
reporting requirements and a report on Form 4 or Form 5 must be filed to
reflect changes thereafter. Based on written statements and copies of forms
provided to the Company by persons subject to the reporting requirements, the
Company believes that all such reports required to be filed by such persons
during fiscal 1997 were filed on a timely basis, except for a late Form 4 for
Mr. Goodall reporting the gift of stock.
11
<PAGE>
PROPOSAL TWO
RATIFICATION OF THE APPOINTMENT
OF INDEPENDENT ACCOUNTANTS
The Board of Directors has appointed KPMG Peat Marwick LLP as
independent accountants to examine the consolidated accounts of the Company
for the fiscal year ending September 27, 1998, subject to ratification by
stockholders. KPMG Peat Marwick LLP has acted as accountants for Foodmaker
since 1986. The firm will be represented at the Meeting and will have the
opportunity to make a statement and respond to appropriate questions from
stockholders.
OTHER BUSINESS
Foodmaker's management is not aware of any other matters to come before
the Meeting. If any matter not mentioned herein is properly brought before
the Meeting, the persons named in the enclosed proxy will have discretionary
authority to vote all proxies with respect thereto in accordance with their
best judgment.
Pursuant to the Company's Bylaws, in order for a stockholder to present
business at the Annual Meeting or to make nominations for election of a
director, such matters must be filed in writing with the Secretary of the
Company in a timely manner. To be timely, a stockholder's notice must be
delivered to the principal executive offices of the Company not less than
ninety (90) nor more than one hundred and twenty (120) days prior to the
meeting as originally scheduled; provided, however, that in the event that
less than 100 days' notice or prior public disclosure of the date of the
meeting is made to stockholders, notice by the stockholder must be received
not later than the close of business on the 10th day following the day on
which notice of the date of the Annual Meeting was mailed or public
disclosure was made. Such notice shall set forth, as to the stockholder
giving notice, the stockholder's name and address as they appear on the
Company's books, and the class and number of shares of the Company which are
beneficially owned by such stockholder. Additionally, (i) with respect to a
stockholder's notice regarding a nominee for director, such notice shall set
forth, as to each person whom the stockholder proposes to nominate for
election or re-election as a director, all information relating to such
person that is required to be disclosed in solicitations of proxies for
election of directors pursuant to the Securities Exchange Act of 1934, as
amended (including such person's written consent to being named in the Proxy
Statement as a nominee and to serving as a director if elected); and (ii)
with respect to a notice relating to a matter the stockholder proposes to
bring before the Annual Meeting, a brief description of the business desired
to be brought before the meeting and any material interest of the stockholder
in such business.
STOCKHOLDER PROPOSALS FOR 1999 ANNUAL MEETING
Any eligible stockholder of the Company wishing to have a proposal
considered for inclusion in the Company's 1999 proxy solicitation materials
must set forth such proposal in writing and file it with the Secretary of the
Company on or before September 11, 1998. Any such proposals must comply in
all respects with the rules and regulations of the Securities and Exchange
Commission.
12
<PAGE>
1997 ANNUAL REPORT AND FORM 10-K
A copy of the 1997 Annual Report to Stockholders accompanies this Proxy
Statement. Foodmaker's Annual Report on Form 10-K for the year ended
September 28, 1997, as filed with the Securities and Exchange Commission,
contains detailed information concerning Foodmaker and its operations which
is not included in the 1997 Annual Report. A COPY OF THE 1997 FORM 10-K WILL
BE FURNISHED TO STOCKHOLDERS WITHOUT CHARGE UPON REQUEST IN
WRITING TO:
Foodmaker Treasury Department, 9330 Balboa Avenue, San Diego, California
92123-1516.
By Order of the Board of Directors,
LAWRENCE E. SCHAUF
LAWRENCE E. SCHAUF
Secretary
13
<PAGE>
Proxy with telephone voting instructions - side one --------------------------
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOODMAKER, INC.
FOR ANNUAL MEETING OF STOCKHOLDERS ON FEBRUARY 13, 1998 AT 2:00 P.M.
SAN DIEGO PRINCESS RESORT, 1404 WEST VACATION ROAD, SAN DIEGO, CA
The undersigned hereby appoints Jack W. Goodall, Charles W. Duddles and
Lawrence E. Schauf and each of them, acting by a majority or by one of them
if only one is acting, as lawful proxies, with full power of substitution,
for and in the name of the undersigned, to vote on behalf of the undersigned,
with all the powers the undersigned would possess if personally present at
the Annual Meeting of Stockholders of Foodmaker, Inc., a Delaware corporation
("Foodmaker"), on February 13, 1998, and any postponements or adjournments
thereof. The above named proxies are instructed to vote all the
undersigned's shares of stock on the proposals set forth in the Notice of
Annual Meeting and Proxy Statement as specified on the other side hereof and
are authorized in their discretion to vote upon such other business as may
properly come before the meeting or any postponements or adjournments
thereof. This proxy when properly executed will be voted in the manner
directed herein by the undersigned stockholder. If no direction is made,
this proxy will be voted "FOR" all nominees listed and "FOR" Proposal 2. The
Board of Directors recommends a vote FOR the above proposals.
(Continued, and to be marked, dated and signed, on the other side)
---------------------------------------------------------------------------
^ FOLD AND DETACH HERE ^
FOODMAKER, INC.
ANNUAL MEETING OF STOCKHOLDERS
FEBRUARY 13, 1998 AT 2:00 P.M.
SAN DIEGO PRINCESS RESORT
1404 WEST VACATION ROAD, SAN DIEGO, CA
<PAGE>
Proxy with telephone voting instructions - side two --------------------------
The Board of Directors recommends a vote FOR Proposals 1 and 2
Please mark
your votes as
indicated in /x/
this example
FOR WITHHOLD FOR ALL
1. ELECTION OF DIRECTORS ALL ALL EXCEPT
(noted below)
Nominees: / / / / / /
01 Michael E. Alpert 05 Edward Gibbons
02 Jay W. Brown 06 Jack W. Goodall
03 Paul T. Carter 07 Robert J. Nugent
04 Charles W. Duddles 08 L. Robert Payne
(Instruction: To withhold authority to vote for any individual nominee mark
the "FOR ALL EXCEPT" box above and write that nominee's name below.)
- ---------------------------------------------
2. Ratification of appointment of KPMG Peat FOR AGAINST ABSTAIN
Marwick LLP as independent accountants. / / / / / /
3. In their discretion, the Proxies are authorized
to vote upon such other business as may
properly come before the meeting.
I plan to attend the meeting. YES NO
/ / / /
- -----------------------------------------------
*** IF YOU WISH TO VOTE BY TELEPHONE, PLEASE READ THE INSTRUCTIONS
BELOW ***
[NAME, ADDRESS & SHARE INFORMATION]
Signature(s)_________________________Dated:___________________, 1998
Stockholder(s), please sign above exactly as name appears hereon; in the case
of joint holders, all should sign. Fiduciaries should add their full title to
their signature. Corporations should sign in full corporate name by an
authorized officer. Partnerships should sign in partnership name by an
authorized person.
-------------------------------------------------------------------------
^ FOLD AND DETACH HERE ^
VOTE BY TELEPHONE
QUICK * * * EASY * * * IMMEDIATE
Your telephone vote authorizes the named proxies to vote your shares in the
same manner as if you marked, signed and returned your proxy card.
You will be asked to enter a Control Number which is located in the box in
the lower right hand corner of this form.
OPTION #1: To vote as the Board of Directors recommends on ALL proposals,
press 1.
Your vote will be confirmed and cast as you directed. END OF CALL
OPTION #2: If you choose to vote on each proposal separately, press 0. You
will hear these instructions:
Proposal 1: To vote FOR ALL nominees, press 1; to WITHHOLD FOR ALL
nominees, press 9; To WITHHOLD FOR AN INDIVIDUAL nominee,
press 0 and listen to the instructions
Proposal 2: To vote FOR, press 1; AGAINST, press 9; ABSTAIN, press 0
Your vote will be confirmed and cast as you directed. END OF CALL.
If you vote by telephone, there is no need for you to mail back your proxy.
THANK YOU FOR VOTING
Call * * Toll Free * * On a Touch Tone Telephone
1-800-840-1208 - ANYTIME
There is NO CHARGE to you for this call CONTROL NUMBER
<PAGE>
Proxy without telephone voting instructions - side one -----------------------
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOODMAKER, INC.
FOR ANNUAL MEETING OF STOCKHOLDERS ON FEBRUARY 13, 1998 AT 2:00
P.M.
SAN DIEGO PRINCESS RESORT, 1404 WEST VACATION ROAD, SAN DIEGO, CA
The undersigned hereby appoints Jack W. Goodall, Charles W. Duddles and
Lawrence E. Schauf and each of them, acting by a majority or by one of them
if only one is acting, as lawful proxies, with full power of substitution,
for and in the name of the undersigned, to vote on behalf of the undersigned,
with all the powers the undersigned would possess if personally present at
the Annual Meeting of Stockholders of Foodmaker, Inc., a Delaware corporation
("Foodmaker"), on February 13, 1998, and any postponements or adjournments
thereof. The above named proxies are instructed to vote all the
undersigned's shares of stock on the proposals set forth in the Notice of
Annual Meeting and Proxy Statement as specified on the other side hereof and
are authorized in their discretion to vote upon such other business as may
properly come before the meeting or any postponements or adjournments
thereof. This proxy when properly executed will be voted in the manner
directed herein by the undersigned stockholder. If no direction is made,
this proxy will be voted "FOR" all nominees listed and "FOR" Proposal 2. The
Board of Directors recommends a vote FOR the above proposals.
(Continued, and to be marked, dated and signed, on the other side)
-----------------------------------------------------------------------
^ FOLD AND DETACH HERE ^
FOODMAKER, INC.
ANNUAL MEETING OF STOCKHOLDERS
FEBRUARY 13, 1998 AT 2:00 P.M.
SAN DIEGO PRINCESS RESORT
1404 WEST VACATION ROAD, SAN DIEGO, CA
<PAGE>
Proxy without telephone voting instructions - side two -----------------------
The Board of Directors recommends a vote FOR Proposals 1 and 2
Please mark
your votes as
indicated in /x/
this example
FOR WITHHOLD FOR ALL
1. ELECTION OF DIRECTORS ALL ALL EXCEPT
(noted below)
Nominees: / / / / / /
01 Michael E. Alpert 05 Edward Gibbons
02 Jay W. Brown 06 Jack W. Goodall
03 Paul T. Carter 07 Robert J. Nugent
04 Charles W. Duddles 08 L. Robert Payne
(Instruction: To withhold authority to vote for any individual nominee mark
the "FOR ALL EXCEPT" box above and write that nominee's name below.)
- ---------------------------------------------
2. Ratification of appointment of KPMG Peat FOR AGAINST ABSTAIN
Marwick LLP as independent accountants. / / / / / /
3. In their discretion, the Proxies are authorized
to vote upon such other business as may
properly come before the meeting.
I plan to attend the meeting. YES NO
/ / / /
- -----------------------------------------------
[NAME, ADDRESS & SHARE INFORMATION]
Signature(s)______________________________Dated:________________, 1998
Stockholder(s), please sign above exactly as name appears hereon; in the case
of joint holders, all should sign. Fiduciaries should add their full title to
their signature. Corporations should sign in full corporate name by an
authorized officer. Partnerships should sign in partnership name by an
authorized person.
------------------------------------------------------------------------
^ FOLD AND DETACH HERE ^
<PAGE>
Proxy Easy$aver Plus Plan - side one -----------------------------------------
FOODMAKER, INC. EASY$AVER PLUS PLAN BALLOT
FOR ANNUAL MEETING OF STOCKHOLDERS ON FEBRUARY 13, 1998 AT 2:00
P.M.
SAN DIEGO PRINCESS RESORT, 1404 WEST VACATION ROAD, SAN DIEGO, CA
This is a ballot for voting instructions for the shares of Foodmaker, Inc.
stock allocated to your Foodmaker, Inc Easy$aver Plus Plan account. Mellon
Bank, N.A., as Trustee of the Plan, will vote all shares held in your account
as directed on your ballot at the Foodmaker, Inc. Annual Meeting of
Stockholders to be held on February 13, 1998.
Indicate your voting instructions for the proposals on the ballot, sign and
date it, and return it in the envelope provided. Your ballot must be
received on or before February 11, 1998 in order to be counted. Your voting
instructions will be kept confidential.
If you properly sign and return your ballot, the Trustee will vote your
shares according to your instructions. If you do not properly sign and
return the ballot to be received on or before February 11, 1998, to Ellen
Philip Associates Inc., no action will be taken with respect to those shares
which have been allocated to your account.
(Continued, and to be marked, dated and signed, on the other side)
-----------------------------------------------------------------------
^ FOLD AND DETACH HERE ^
FOODMAKER, INC.
ANNUAL MEETING OF STOCKHOLDERS
FEBRUARY 13, 1998 AT 2:00 P.M.
SAN DIEGO PRINCESS RESORT
1404 WEST VACATION ROAD, SAN DIEGO, CA
<PAGE>
Proxy Easy$aver Plus Plan - side two -----------------------------------------
The Board of Directors recommends a vote FOR Proposals 1 and 2
Please mark
your votes as
indicated in /x/
this example
FOR WITHHOLD FOR ALL
1. ELECTION OF DIRECTORS ALL ALL EXCEPT
(noted below)
Nominees: / / / / / /
01 Michael E. Alpert 05 Edward Gibbons
02 Jay W. Brown 06 Jack W. Goodall
03 Paul T. Carter 07 Robert J. Nugent
04 Charles W. Duddles 08 L. Robert Payne
(Instruction: To withhold authority to vote for any individual nominee mark
the "FOR ALL EXCEPT" box above and write that nominee's name below.)
- ---------------------------------------------
2. Ratification of appointment of KPMG Peat FOR AGAINST ABSTAIN
Marwick LLP as independent accountants. / / / / / /
3. In their discretion, the Proxies are authorized
to vote upon such other business as may
properly come before the meeting.
- -----------------------------------------------
[NAME, ADDRESS & SHARE INFORMATION]
Signature(s)____________________________________Dated:________________, 1998
Please sign above exactly as name appears hereon.
--------------------------------------------------------------------------
^ FOLD AND DETACH HERE ^
<PAGE>
BALLOT FOODMAKER, INC. BALLOT
Annual Meeting of Stockholders, February 13, 1998
The undersigned votes_________________________________(_______________________)
shares of stock, with respect to the following:
1. Election of Directors: Michael E. Alpert, Jay W. Brown, Paul T. Carter,
Charles W. Duddles, Edward Gibbons, Jack W. Goodall, Robert J. Nugent
and L. Robert Payne.
/ / FOR all nominees listed.
/ / WITHHOLD AUTHORITY to vote for all nominees listed.
/ / FOR all nominees listed except__________________________________
2. Ratification of appointment of KPMG Peat Marwick LLP as independent
accountants. / / FOR / / AGAINST / / ABSTAIN
____________________________________________
Stockholder's signature (/ / check box if you are voting shares held in
Easy$aver Plus Plan)
INSTRUCTION: If ballot is cast by proxy, print stockholder name above or, if
multiple stockholders, print "Proxies Filed" above.
____________________________________________
Proxy signature (if ballot is cast by proxy)
