<PAGE> 1
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
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
Jan Bell Marketing, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(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:
(4) Proposed maximum aggregate value of transaction:
Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
JAN BELL MARKETING, INC.
[LOGO]
13801 NORTHWEST 14TH STREET
SUNRISE, FLORIDA 33323
---------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
JUNE 10, 1994
---------------------
TO THE SHAREHOLDERS:
The Annual Meeting of Shareholders of Jan Bell Marketing, Inc., a Delaware
corporation, will be held on Friday, June 10, 1994 at 11:00 a.m., local time at
the Bonaventure Resort, 250 Racquet Club Road, Fort Lauderdale, Florida.
(1) To elect three directors to serve for the next three years or
until their successor(s) are elected;
(2) To ratify the appointment of Deloitte & Touche as independent
accountants of the Company for the fiscal year ending January 29, 1995; and
(3) To transact such other business as may properly come before the
meeting or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only shareholders of record at the close of business on April 29, 1994 are
entitled to notice of and to vote at the meeting.
All shareholders are cordially invited to attend the meeting in person.
Sincerely,
/s/ Alan H. Lipton
-----------------------
Alan H. Lipton
Chief Executive Officer
Sunrise, Florida
May 4, 1994
- --------------------------------------------------------------------------------
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND
SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE TO ASSURE
REPRESENTATION OF YOUR SHARES. NO POSTAGE NEED BE AFFIXED IF MAILED IN THE
UNITED STATES.
- --------------------------------------------------------------------------------
<PAGE> 3
JAN BELL MARKETING, INC.
---------------------
PROXY STATEMENT
---------------------
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
The enclosed Proxy is solicited by the Board of Directors of Jan Bell
Marketing, Inc. (the "Company") for use at the Annual Meeting of Shareholders to
be held Friday, June 10, 1994 at 11:00 a.m. local time, or at any adjournment
thereof, for the purposes set forth herein and in the accompanying Notice of
Annual Meeting of Shareholders. The Annual Meeting will be held at the
Bonaventure Resort, 250 Racquet Club Road, Fort Lauderdale, Florida.
These proxy solicitation materials were mailed on or about May 6, 1994.
Although the Annual Report is being mailed with the proxy materials, the Annual
Report should not be deemed to be part of this Proxy Statement.
The Company's corporate offices are located at 13801 Northwest 14th Street,
Sunrise, Florida, and its phone number at such address is (305) 846-8000.
RECORD DATE AND SHARE OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Shareholders of record at the close of business April 29, 1994 are entitled
to notice of and to vote at the meeting. At the record date, 25,852,238 shares
of the Company's voting common stock were issued and outstanding.
A list of stockholders entitled to vote at the meeting will be available at
the Company's corporate offices on June 10, 1994 and for ten days prior to the
meeting between the hours of 9:00 a.m. and 5:00 p.m.
As of April 25, 1994, the following table sets forth the beneficial
ownership of voting common stock of the Company by each director and director
nominee, by each of the current executive officers named in the summary
compensation table on page 7, by all directors and executive officers as a group
and by all persons known by the Company to be the beneficial owners of more than
5% of the voting common stock:
<TABLE>
<CAPTION>
SHARES OF COMMON STOCK
BENEFICIALLY OWNED
--------------------------
PERCENT OF
NUMBER OF SHARES
NAME AND ADDRESS(1)(2) SHARES OUTSTANDING(1)
--------------------------------------------------------- --------- --------------
<S> <C> <C>
Alan H. Lipton........................................... 1,497,339 5.8%
Janice L. Lipton......................................... 400,000 1.5%
Peter J. Hayes(3)........................................ 30,000
Richard W. Bowers(4)..................................... 172,027
Richard S. Banick(5)..................................... 16,000
Alan L. Gosule(6)........................................ 10,000
Eliahu Ben Shmuel(7)..................................... 1,430,750 5.5%
</TABLE>
<PAGE> 4
<TABLE>
<CAPTION>
SHARES OF COMMON STOCK
BENEFICIALLY OWNED
--------------------------
PERCENT OF
NUMBER OF SHARES
NAME AND ADDRESS(1)(2) SHARES OUTSTANDING(1)
--------------------------------------------------------- --------- --------------
<S> <C> <C>
Rosemary B. Trudeau(8)................................... 18,354
Frank S. Fuino, Jr.(9)................................... 6,667
Marbella Resources, Ltd(10).............................. 1,806,642 7.0%
Tropical Isle Building
Wickhams Cay, Road Town
Tortola, British Virgin Islands
SunTrust Banks, Inc.(11)................................. 4,457,105 17.2%
25 Park Place, Northeast
Atlanta, Georgia 30303
All executive officers and directors as a group (10
persons)(12)........................................... 3,592,757 13.8%
</TABLE>
- ---------------
(1) Unless otherwise noted, each person has sole voting and investment power
over the shares listed opposite his or her name and percentages less than
one percent are omitted.
(2) Unless otherwise noted, address of beneficial owners of more than five
percent of the common stock: c/o Jan Bell Marketing, Inc., 13801 Northwest
14th Street, Sunrise, Florida 33323.
(3) Includes currently exercisable options to purchase 30,000 shares.
(4) Includes currently exercisable options to purchase 90,000 shares.
(5) Includes currently exercisable options to purchase 15,000 shares.
(6) Includes currently exercisable options to purchase 10,000 shares.
(7) Includes currently exercisable options to purchase 10,000 shares and
146,800 shares held in the Ben Shmuel 1992 Charitable Unitrust.
(8) Includes currently exercisable options to purchase 18,334 shares.
(9) Includes currently exercisable options to purchase 6,667 shares.
(10) Marbella Resources Limited filed a Schedule 13D, dated June 22, 1993
reporting 1,806,642 shares beneficially owned with the sole power to vote 0
shares, the shared power to vote 1,806,642 shares, the sole power to
dispose of 0 shares, and the shared power to dispose of 1,806,642 shares.
(11) SunTrust Banks, Inc. filed a Schedule 13G, dated February 9, 1994, in
various fiduciary and agency capacities reporting 4,457,105 shares
beneficially owned with the sole power to vote or to direct the vote of
3,366,225 shares, the shared power to vote 0 shares, the sole power to
dispose or direct the disposition of 4,328,000 shares, and the shared power
to dispose or direct the disposition of 45,130 shares.
(12) Includes 191,668 shares issuable upon the exercise of currently exercisable
stock options for all executive officers and directors. Also includes the
shares owned by Mrs. Lipton.
REVOCABILITY OF PROXIES
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before it is used by delivering to the Company a written
notice of revocation or a duly executed proxy bearing a later date or by
attending the meeting and voting in person.
2
<PAGE> 5
VOTING AND SOLICITATION
If a proxy in the form distributed by the Company is properly executed and
returned to the Company, the shares represented by that proxy will be voted at
the Annual Meeting. Where a stockholder specifies a choice, the proxy will be
voted as specified. If no choice is specified, the shares represented by the
proxy will be voted for the election of all nominees and for the appointment of
the independent accountants.
Each share has one vote on each matter properly submitted for a vote at the
meeting. A majority of the outstanding shares will constitute a quorum at the
meeting. Abstentions and broker non-votes are counted for purposes of
determining the presence of a quorum. The nominees receiving the most support
for the number of positions to be filled are elected directors. Abstentions are
counted in tabulations of the votes cast on proposals presented to stockholders,
whereas broker non-votes are not counted for purposes of determining whether a
proposal has been approved.
The cost of this solicitation will be borne by the Company. In addition,
the Company may reimburse brokerage firms and other persons representing
beneficial owners of shares for their expenses in forwarding solicitation
materials to such beneficial owners. Proxies may also be solicited by certain of
the Company's directors, officers and regular employees, without additional
compensation, personally or by telephone or telegram.
DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS
Proposals of security holders of the Company which are intended to be
presented by such shareholders at the Company's 1995 Annual Meeting must be
received by the Company no later than January 9, 1995 in order that they may be
considered for inclusion in the proxy statement and form of proxy relating to
that meeting. Additionally, if a stockholder wishes to present to the Company an
item for consideration as an agenda item for a meeting, he or she must give
timely notice to the Secretary and give a brief description of the business
desired to be discussed. To be timely for the 1994 Annual Meeting, such notice
must be delivered to or mailed to and received by the Company no later than 5:00
p.m. local time on May 20, 1994.
ELECTION OF DIRECTORS
NOMINEES
The Board of Directors currently consists of seven members and is
classified into three classes with each class holding office for a three year
period. The terms of Messrs. Hayes, Bowers and Gosule expire in 1994; the terms
of Ms. Trudeau and Mr. Ben Shmuel expire in 1995; and the terms of Messrs.
Lipton and Banick expire in 1996. Under the Bylaws, the number of directors may
be increased to nine. The Certificate of Incorporation restricts the removal of
directors under certain circumstances.
Accordingly, three directors (Messrs. Hayes, Bowers and Gosule) are to be
re-elected at the meeting. Unless otherwise instructed, the proxy holders will
vote the proxies received by them for Messrs. Hayes, Bowers and Gosule as the
Company's nominees. If any nominee of the Company is unable or declines to serve
as a director at the time of the Annual Meeting, the proxies will be voted for
any nominee who shall be designated by the present Board of Directors to fill
the vacancy. It is not expected that any nominee will be unable or will decline
to serve as a director. The term of office of each person elected as a director
will continue until the third Annual Meeting of Shareholders after election
(i.e., 1997) or until his successor has been elected and qualified.
3
<PAGE> 6
Any shareholder entitled to vote for the election of directors at a meeting
may nominate persons for election as directors only if written notice of such
shareholder's intent to make such nomination is given, either by personal
delivery or by United States mail, postage prepaid to Corporate Secretary, Jan
Bell Marketing, Inc., 13801 Northwest 14th Street, Sunrise, Florida 33323, not
later than: (i) with respect to the election to be held at an annual meeting of
shareholders, 30 days in advance of such meeting, and, (ii) with respect to any
election to be held at a special meeting of shareholders for the election of
directors, the close of business on the tenth day following the date on which
notice of such meeting is first given to shareholders. Each such notice must set
forth: (a) the name and address of the shareholder who intends to make the
nomination and of the person or persons to be nominated, (b) a representation
that such shareholder is a holder of record of stock of the corporation entitled
to vote at such meeting and intends to appear in person or by proxy at the
meeting to nominate the person or persons specified in the notice, (c) a
description of all arrangements or understandings between such shareholder and
each nominee and any other person or persons (naming such person or persons)
pursuant to which the nomination or nominations are to be made by such
shareholder, (d) such other information regarding each nominee proposed by such
shareholder as would have been required to be included in a proxy statement
filed pursuant to the proxy rules of the Securities and Exchange Commission if
such nominee had been nominated or intended to be nominated by the Board of
Directors, and (e) the consent of each nominee to serve as a director if
elected. The chairman of a shareholder meeting may refuse to acknowledge the
nomination of any person not made in compliance with the foregoing procedure.
INFORMATION REGARDING DIRECTORS
The names of the directors and director nominees and certain information
about them are set forth below.
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE PRINCIPAL OCCUPATION SINCE
- ---------------------------- --- ------------------------------------------------- --------
<S> <C> <C> <C>
Alan H. Lipton 43 Chairman of the Board and Chief Executive Officer 1983
Peter J. Hayes 51 Director, President and Chief Operating Officer 1994
Richard W. Bowers 42 Vice Chairman of the Board, Senior Executive Vice 1991
President, General Counsel and Secretary
Eliahu Ben Shmuel 51 Director and Executive Vice President of 1993
Procurement -- Watches and Accessories
Rosemary B. Trudeau 46 Director and Senior Vice President of Investor 1987
Relations
Richard S. Banick 62 Director and Partner of Fowler, White, Barnett, 1991
Hurley, Banick & Strickroot, P.A.
Alan L. Gosule 53 Director and Partner of Rogers & Wells 1993
</TABLE>
ALAN H. LIPTON
Mr. Lipton has been a Director of the Company and its predecessors since
1983 and the Chief Executive Officer since July 1987.
PETER J. HAYES
Mr. Hayes was appointed Director, President and Chief Operating Officer in
April 1994. Prior to joining Jan Bell, Mr. Hayes served as President and Chief
Operating Officer of Family Dollar Stores since February 1991. From 1988 through
January 1991, Mr. Hayes was the President and Chief Executive Officer of Child
World, a company which filed for bankruptcy in May 1992. Prior to joining Child
World in 1988, Mr. Hayes was Chairman and Chief Executive Officer of Gold Circle
Inc., a chain of retail discount stores.
4
<PAGE> 7
Mr. Hayes has more than twenty years experience at the senior management level
in the discount store industry.
RICHARD W. BOWERS
Mr. Bowers has been the Senior Executive Vice President and General Counsel
of Jan Bell since May 1991, Vice Chairman of the Board since July 1991 and
Secretary since September 1992. Prior to such time, he was engaged in the
private practice of law with the firm of Gaston & Snow, which firm filed for
bankruptcy in October 1991.
ELIAHU BEN SHMUEL
Mr. Ben Shmuel has been a Director of the Company since June, 1993 and has
been Executive Vice President of Procurement -- Watches and Accessories since
May 1993. Mr. Ben Shmuel had been Director of the Watch Division of Jan Bell
since September 1991. From 1990 to September 1991, Mr. Ben Shmuel was President
of Big Ben '90, a watch joint venture formed with the Company. Prior to this,
Mr. Ben Shmuel was engaged in the marketing and sale of watches with Big Ben
Corporation based in Miami.
ROSEMARY B. TRUDEAU
Ms. Trudeau has been a Director of the Company since June 1987 and has been
the Senior Vice President of Investor Relations since November 1992. From March
1990 until November 1992 she was the Senior Vice President of Finance and Chief
Financial Officer. From February 1988 to March 1990, she was a Division Vice
President, Product Management, of AmeriFirst Bank, Miami, Florida and was a
consultant to AmeriFirst from September 1987 to February 1988. From September
1986 to September 1987, Ms. Trudeau was a professor of business finance and
management at Briarcliff College, Miami, Florida. From July 1983 to May 1986,
Ms. Trudeau was employed by Southeast Bank as a Vice President and was
responsible for corporate services and corporate lending.
RICHARD S. BANICK
Mr. Banick has been a director of the Company since December 1991. For the
past twenty years, Mr. Banick has been a managing director and Chairman of the
Litigation Department of Fowler, White, Hurley, Banick & Strickroot, P.A., a law
firm located in Miami, Florida. Mr. Banick is a Director of City National Bank
of Florida, which is headquartered in Miami, Florida.
ALAN L. GOSULE
Mr. Gosule was appointed a Director of Jan Bell in May 1993. Mr. Gosule is
Chairman of the Tax Department and a partner with the law firm of Rogers &
Wells, where he has been employed since July 1991. From September 1970 to July
1991, Mr. Gosule was a partner with the law firm of Gaston & Snow, which firm
filed for bankruptcy in October 1991. Mr. Gosule is a Trustee for Advest
Advantage Investment Trusts, a family of mutual funds and a Director of F.L.
Putnam Investment Management Company.
COMPENSATION OF DIRECTORS
Directors who are not employees of the Company receive compensation of
$20,000 per year plus reimbursement of reasonable expenses and automatically
receive options to purchase 10,000 voting common shares each year at an exercise
price equal to the market price on the grant date, which is January 1 of each
5
<PAGE> 8
year. Such options are exercisable in full six months after the grant date and
until two years after a person ceases to be a director. Directors who are
employees of the Company do not receive compensation for services as a director.
BOARD MEETINGS AND COMMITTEES
The Board of Directors held a total of four meetings and two Consents to
Action in Lieu of Meetings during the fiscal year ended December 31, 1993. No
Director attended fewer than 75% of the aggregate of all meetings of the Board
of Directors or any committees.
The Board presently has an Audit Committee, a Compensation Committee and
does not have a nomination committee.
The Audit Committee currently consists of Mr. Gosule and Mr. Banick and met
four times in 1993. The Audit Committee can meet independently with the internal
auditing staff, representatives of the Company's independent accountants and
with representatives of senior management. The Committee reviews the general
scope of the Company's annual audit and other matters relating to internal
control systems. In addition, the Audit Committee is responsible for reviewing
and monitoring the performance of non-audit services by the Company's auditors
as well as reviewing the engagement or discharge of the Company's independent
accountants.
The Compensation Committee currently consists of Mr. Banick and Mr. Gosule
and met five times in 1993. The Compensation Committee may review and report to
the Board the salaries and benefit programs designed for executive officers with
a view to insure that the Company is attracting and retaining highly qualified
managers through competitive salary and benefit programs and encouraging
extraordinary effort through incentive rewards.
6
<PAGE> 9
COMPENSATION OF EXECUTIVE OFFICERS
EXECUTIVE COMPENSATION
The following table sets forth certain information regarding compensation
paid by the Company to each of the five most highly compensated executive
officers of the Company during the year ending December 31, 1993:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
--------------------
ANNUAL COMPENSATION AWARDS
----------------------------------- --------------------
OTHER RESTRICTED
ANNUAL STOCK ALL OTHER
SALARY BONUS COMPENSATION AWARDS(1) OPTIONS COMPENSATION(2)
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) ($) (#) ($)
- -------------------------------------- ---- -------- -------- ------------ ---------- ------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Alan H. Lipton 1993 $121,445 $ 0 N/A(3) $1,742,812 100,000 $14,318
CEO and President 1992 459,275 214,570 N/A 0 0 0
1991 430,000 161,732 N/A 0 0 N/A
Lee A. Mills(4) 1993 78,541 0 $ 88,883(5) 1,742,812 100,000 0
Chairman of the Board and 1992 294,477 182,285 N/A 270,625 75,000 0
Senior Advisor to the Board on 1991 372,173 226,150 N/A 450,000 50,000 N/A
Strategic Planning
Richard W. Bowers 1993 292,186 0 N/A 697,125 75,000 13,790
Senior Executive Vice President and 1992 294,477 182,285 135,000 50,000 0
General Counsel 1991 171,827 137,993 423,500 130,000 N/A
Eli Ben Shmuel 1993 121,442 0 N/A 1,742,812 100,000 0
Executive Vice President of
Procurement -- Watches and
Accessories
Frank S. Fuino, Jr. 1993 114,423 45,000 N/A 0 45,000 15,000
Executive Vice President of Finance
and Chief Financial Officer
</TABLE>
- ---------------
(1) The 97,500 restricted shares granted to Mr. Lipton in 1993 vest in 19,500
increments on July 31, 1994, 1995, 1996, 1997 and 1998. The 97,500
restricted shares granted to Mr. Mills in 1993 originally were to vest in
32,500 increments on July 31, 1994, 1995 and 1996; the shares vested upon
his departure in March 1994. The 97,500 restricted shares granted to Mr.
Ben Shmuel in 1993 vest in 19,500 increments on September 29, 1994, 1995,
1996, 1997 and 1998. The 39,000 restricted shares granted to Mr. Bowers in
1993 vest in 13,000 share increments on April 30, 1994, 1995 and 1996. All
of the foregoing grants were made on May 14, 1993, at which time the common
stock price was $17.875. Dividends (if any) will be paid on restricted
stock. The aggregate number of shares of restricted stock and their value
at fiscal year-end ($9.375 per share) is as follows: Alan Lipton -- 97,500
shares, $914,062.50; Lee Mills -- 150,195 shares, $1,408,078; Eli Ben
Shmuel -- 97,500 shares, $914,062.50; and Richard Bowers -- 66,130 shares,
$619,968.75.
(2) The amounts set forth in this column for each individual represent payments
of annual premiums by the Company for whole life insurance policies
provided to executive officers.
(3) Entries marked "n/a" represent information which is not reportable.
(4) Mr. Mills' employment terminated in March 1994.
7
<PAGE> 10
(5) Of the total amount, $15,553 represents an allocation of personal use of a
Company provided automobile and approximately $73,000 represents payments
for temporary housing assistance.
Mr. Lipton is employed as the Chief Executive Officer until July 31, 1996.
Mr. Lipton receives a base salary of $451,800 (subject to annual adjustment to
reflect increases in the consumer price index) and an annual bonus equal to one
percent of income before taxes. The agreement allows Jan Bell to terminate the
employment of Mr. Lipton prior to the expiration date for cause without
termination benefits or without cause upon the payment of the base salary and
annual bonus for the remaining term of the agreement with acceleration of
outstanding options and vesting of bonus stock. Mr. Lipton may terminate the
agreement upon 90 days prior written notice. Mr. Lipton may also terminate the
agreement on the same terms as a termination by the Company without cause if the
Company materially breaches the agreement, including the obligation to have him
serve in the capacity as Chief Executive Officer. Mr. Lipton elected voluntarily
at his decision not to receive his base salary from April 7, 1993 through
December 31, 1993.
Mr. Mills was employed as the Chairman of the Board of Directors and Senior
Advisor to the Board on Strategic Planning until July 31, 1996. Mr. Mills
received a base annual salary of $292,300 (subject to annual adjustment to
reflect increases in the consumer price index) and an annual bonus equal to 1/2
of 1% of income before taxes. The agreement allowed Jan Bell to terminate the
employment of Mr. Mills prior to the expiration date for cause without
termination benefits or without cause upon the payment of the base salary and
annual bonus for the remaining term of the agreement with acceleration of
outstanding options and vesting of bonus stock. Mr. Mills elected voluntarily at
his decision not to receive his base salary from April 7, 1993 through December
31, 1993. Mr. Mills and the Company agreed to his termination of employment and
resignation as a director in March 1994, at which time Mr. Mills received
approximately $681,966 in cash, a car and the acceleration of outstanding
options and vesting of previously issued restricted stock.
Mr. Ben Shmuel is employed as the Executive Vice President of Procurement,
Watches and Accessories until September 30, 1996. Mr. Ben Shmuel receives a base
salary of $451,800 (subject to annual adjustment to reflect increases in the
consumer price index) and an annual bonus equal to one percent of income before
taxes. The agreement allows Jan Bell to terminate the employment of Mr. Ben
Shmuel prior to the expiration date for cause without termination benefits or
without cause upon the payment of the base salary and annual bonus for the
remaining term of the agreement with acceleration of outstanding options and
vesting of bonus stock. Mr. Ben Shmuel may terminate the agreement upon 90 days
written notice. Mr. Ben Shmuel may also terminate the agreement on the same
terms as a termination by the Company without cause if the Company materially
breaches the agreement, including the obligation to have him serve as the
manager of the watch and special accessory division of the Company. Mr. Ben
Shmuel elected voluntarily at his decision not to receive his base salary from
April 7, 1993 through December 31, 1993.
Mr. Bowers is employed as the Senior Executive Vice President, General
Counsel and Vice Chairman of the Board until April 30, 1996. Mr. Bowers receives
a base salary of $292,300 (subject to annual adjustment to reflect increases in
the consumer price index) and an annual bonus equal to 1/2 of 1% of income
before taxes. The agreement allows Jan Bell to terminate his employment for
cause without termination benefits or without cause upon payment of the base
salary and annual bonus for the remaining term of the agreement plus one year
with acceleration of outstanding options and vesting of bonus stock. Mr. Bowers
may terminate the agreement on the same terms as a termination by Jan Bell
without cause following a change in control, the departure of Alan Lipton, the
takeover, merger or acquisition of Jan Bell or a sale of substantially all of
Jan Bell's assets, or the failure to maintain him as Senior Executive Vice
President and Vice Chairman of the Board.
8
<PAGE> 11
Mr. Fuino is employed as Executive Vice President of Finance until May 3,
1996 at a base salary of $175,000 with a discretionary annual bonus not to
exceed $70,000. The agreement allows the Company to terminate the employment of
Mr. Fuino for cause without termination benefits or without cause upon payment
of $175,000 base salary. Mr. Fuino may terminate the agreement on the same terms
as a termination by Jan Bell without cause if the Company merges with or is
acquired by another entity and his duties and position are substantially reduced
or changed in a manner not reasonably acceptable to Mr. Fuino.
Mr. Hayes joined the Company in April 1994 and is employed as the President
and Chief Operating Officer and to be elected as a director until April 24,
1999. Mr. Hayes receives a base annual salary of $500,000 (subject to annual
adjustment to reflect increases in the consumer price index) with a
discretionary annual bonus of up to $200,000. The agreement allows Jan Bell to
terminate his employment for cause without termination benefits or without cause
upon payment of the base salary and annual bonus for the remaining term of the
agreement with the acceleration of outstanding options. Mr. Hayes may terminate
the agreement on the same terms as a termination by Jan Bell without cause
following a change of control, the takeover, merger or acquisition of Jan Bell
or a sale of substantially all of Jan Bell's assets or the failure to maintain
him as President, Chief Operating Officer and a director.
CERTAIN TRANSACTIONS
During 1993, the Company purchased approximately $250,000 of sunglasses,
$2,165,000 of watches and $470,000 of watch boxes from Liss Premium which is a
company owned and operated by Lior Ben Shmuel, who is the son of Mr. Ben Shmuel.
In order to assist Mr. Mills with certain housing relocation expenses in
1993, the Company rented a house for Mr. Mills from an entity in which Mr. Ben
Shmuel has an ownership interest for $60,000, which was the fair market rental
value of such house.
As of March 1, 1994, Mr. Bowers owed the Company $78,500, which represents
funds advanced on behalf of Mr. Bowers by the Company for certain tax
obligations, an overpayment of an estimated bonus previously paid to Mr. Bowers,
and certain personal reimbursable purchases of goods and expenses. Mr. Bowers is
repaying the debt at 7% interest with monthly payments of $3,250, and the debt
is to be repaid in full on or before January 8, 1995.
9
<PAGE> 12
OPTION/SAR GRANTS IN LAST FISCAL YEAR
The following table provides information regarding stock options granted to
the named executive officers in 1993. In addition, in accordance with SEC rules
there are shown the hypothetical gains or "option spreads" that would exist for
the respective options.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- ---------------------------------------------------------------------------------------
PERCENT OF
NUMBER OF TOTAL
SECURITIES OPTIONS/ POTENTIAL REALIZABLE VALUE AT
UNDERLYING SARS ASSUMED ANNUAL RATES OF STOCK PRICE
OPTIONS/ GRANTED TO APPRECIATION
SARS EMPLOYEES EXERCISE OR FOR OPTION TERM(3)
GRANTED(1) IN FISCAL BASE PRICE(2) EXPIRATION -----------------------------------
NAME (#) YEAR ($/SH) DATE 0%($) 5%($) 10%($)
- --------------------------------- ---------- ---------- ------------- ---------- ----- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Alan H. Lipton, CEO.............. 100,000 10.59% $ 9.00 9/03/03 0 $ 566,005 $ 1,434,368
Lee A. Mills..................... 100,000 10.59% $ 9.00 9/03/03 0 566,005 1,434,368
Eli Ben Shmuel................... 100,000 10.59% $ 9.00 9/03/93 0 566,005 1,434,368
Richard W. Bowers................ 75,000 7.94% $ 9.00 9/03/03 0 424,504 1,075,776
Frank Fuino...................... 20,000 2.12% $17.625 5/06/03 0 221,685 561,794
Frank Fuino...................... 25,000 2.65% $ 9.00 9/03/03 0 141,501 358,592
All Shareholders(4).............. 0 146,579,354 369,938,370
</TABLE>
- ---------------
(1) No SAR's were granted in 1993. Individual option grants become exercisable
in installments of 50% per year on each of the first and the second
anniversaries of the grant date for Messrs. Lipton, Mills, Ben Shmuel and
Bowers. Individual option grants become exercisable in installments of
33 1/3% per year on each of the first through the third anniversaries of
the grant date for Mr. Fuino. Options can become immediately exercisable
upon the occurrence of certain corporate events, including a change in
control of the Company or delivery of written notice of a stockholder's
meeting to consider a merger, sale of assets or similar reorganization. All
options granted in 1993 have ten year terms.
(2) All grants were made at 100% of fair market value as of the date of grant.
(3) The dollar amounts under these columns are the result of calculations at 0%
and at the 5% and 10% rates set by the SEC and therefore are not intended
to forecast possible future appreciation, if any, of the Company's stock
price. The Company did not use an alternative formula for a grant date
valuation, as the Company is not aware of any formula which will determine
with reasonable accuracy a present value based on future unknown or
volatile factors.
(4) No gain to the optionees is possible without an increase in stock price
appreciation, which will benefit all shareholders commensurately.
Represents aggregate increases in incremental gain to all stockholders as a
group which would result from the application of the same assumptions to
all shares outstanding on December 31, 1993.
10
<PAGE> 13
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FY-END OPTION/SAR VALUES
The following table shows stock option exercises by named executive
officers in 1993, including the aggregate value of gains on the date of
exercise. In addition, the table includes the number of shares covered by both
exercisable and non-exercisable stock options as of December 31, 1993. Also
reported are the values for "in-the-money" options which represent the positive
spread between the exercise price of any such existing stock options and the
year-end price of $9.375 per share of common stock.
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
SECURITIES IN-THE-MONEY
UNDERLYING OPTIONS/SARS
UNEXERCISED AT
OPTIONS/SARS AT FISCAL
SHARES FISCAL YEAR-END YEAR-END
ACQUIRED (#) ($)
ON VALUE --------------- -------------
EXERCISE REALIZED(1) EXERCISABLE/ EXERCISABLE/
NAME (#) ($) UNEXERCISABLE UNEXERCISABLE
- ---------------------------------------- -------- ----------- --------------- -------------
<S> <C> <C> <C> <C>
Alan H. Lipton, CEO..................... 0 0 0/100,000 0/37,500
Lee A. Mills............................ 0 0 62,500/137,500 0/37,500
Eli Ben Shmuel.......................... 0 0 10,000/120,000 14,950/67,400
Richard W. Bowers....................... 0 0 90,000/100,000 0/28,125
Frank S. Fuino, Jr...................... 0 0 0/ 45,000 0/ 9,375
</TABLE>
- ---------------
(1) Fair market value of shares at exercise minus the exercise price.
11
<PAGE> 14
PERFORMANCE GRAPH
The graph below compares the five year cumulative total return for Jan Bell
stock with the cumulative total return of the Amex Market Value Stock Index and
the S&P Retail Specialty Index. The graph assumes $100 invested on December 31,
1988 in Jan Bell stock and $100 invested at that time in each of the indexes.
The comparison assumes that dividends are reinvested.
<TABLE>
<CAPTION>
JAN BELL
Measurement Period MARKETING S&P RETAIL
(Fiscal Year Covered) INC. SPECIALTY AMEX MARKET
<S> <C> <C> <C>
1988 100.00 100.00 100.00
1989 188.29 125.94 127.52
1990 52.46 124.33 108.14
1991 104.92 188.96 133.19
1992 151.76 252.89 135.02
1993 70.26 251.78 160.41
</TABLE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Under rules established by the Securities and Exchange Commission, the
Company is required to provide certain data and information in regard to the
compensation and benefits provided to the Company's Chief Executive Officer
("CEO") and the four other most highly compensated executive officers. The
disclosure requirements for these five individuals (the "named executive
officers") includes the use of tables and a report explaining the rationale and
considerations regarding the executive compensation decisions affecting those
individuals. In fulfillment of this requirement, the Compensation Committee
consisting of Mr. Banick and Mr. Gosule (the nonemployee directors) has prepared
the following report. Additionally, the Committee obtains from time to time
advice and data concerning executive compensation from an independent
compensation consulting firm. In 1993, advice was obtained regarding stock
option grants, restricted stock awards and cash compensation for newly hired
executives.
12
<PAGE> 15
Compensation Philosophy
This report reflects the Company's compensation philosophy as endorsed by
the Board of Directors and the Committee and resulting actions taken by the
Company. With regard to compensation actions affecting Mr. Lipton, the Committee
will act as the approving body.
The executive compensation program of the Company has been designed to:
- Support a pay for performance policy that provides compensation amounts
based both on overall corporate results and individual performance;
- Motivate key senior officers to achieve strategic business initiatives
and reward them for their achievement;
- Provide total compensation opportunities which allow the Company to
compete for and retain talented results oriented executives who will
contribute to the Company's short-term and long-term success; and
- Align the interests of executives with the long-term interests of
stockholders through award opportunities based on stock performance.
At present, the executive compensation program is comprised of base salary,
annual bonus cash incentive opportunities based on set objective criteria as
well as subjective analysis, and long-term incentive opportunities in the form
of grants of stock options and restricted stock.
As an executive's level of responsibility increases, a greater portion of
his or her potential total compensation opportunity is generally based on
performance incentives and less on base salary, causing greater variability in
the individual's absolute compensation level from year-to-year. Incentive
compensation (all pay other than salary) comprises in excess of 50% of the
compensation opportunity and is tied to the Company's short term earnings and
long term stock performance.
In reviewing or administering the individual elements of the executive
compensation program, the Company and the Committee strive to balance short and
long-term incentive objectives and utilize prudent judgment in reviewing
performance criteria and incentive payments. The following is a discussion of
each of the elements of the executive compensation program along with a
description of the decisions and actions taken with regard to 1993 compensation.
While the Company has not yet established a policy with respect to qualifying
compensation paid to executive officers for deductibility under new Internal
Revenue Code provisions relating to over $1 million compensation packages, the
Company is currently reviewing the regulations.
Annual Compensation Program
Annual total cash compensation for senior management consists of base
salary, variable performance bonuses set by a formula and discretionary bonuses.
Accordingly, total annual cash compensation varies each year based on
achievement of Company performance and profitability.
Base salaries for the named executive officers are set forth in employment
agreements and were not changed in 1993 except for certain automatic minor
adjustments tied to increases in the consumer price index. The base salary for
Mr. Fuino, who joined Jan Bell in May, 1993, was analyzed prior to his hire.
Survey data was utilized, in consultation with the Company's executive
compensation consultant, to set Mr. Fuino's base salary at a median level of
similarly sized companies in similar business environments. Such companies do
not
13
<PAGE> 16
consist of those comprising the S&P Retail Specialty Stores Index, which has
been used for the Stock Performance Graph on page 12. The companies used were
selected because of the similarity of their businesses to that of the Company
and/or to provide local market comparisons. Messrs. Lipton, Mills and Ben Shmuel
elected voluntarily at their decision not to receive base cash compensation from
April 7, 1993 through December 31, 1993.
Payment of an annual variable cash bonus of Mr. Lipton (the CEO) and Mr.
Ben Shmuel is set pursuant to employment agreements at 1% of the Company's net
income before taxes. Similarly, Messrs. Mills and Bowers each receive an annual
cash bonus equal to .5% of the Company's net income before taxes. Pursuant to
the formulas, no such cash bonuses were paid in 1993. Mr. Fuino was eligible
pursuant to his employment agreement for a cash bonus up to 40% of his base
salary, and he received a $45,000 bonus based upon a subjective evaluation of
his job performance in the accounting department.
Additionally, other discretionary bonuses may be awarded from time to time
to reward individual performance. No such awards were made in 1993.
Long-Term Incentives -- 1993 Stock Option and Restricted Stock Awards
The Company's Stock Option and Stock Bonus Plans are designed to align a
significant portion of the named executive compensation with shareholder
interests. In determining the number of options or shares to be awarded, the
amount and terms of options and restricted shares previously granted is not
considered. The plans permit the granting of several different types of stock
based awards. To date, two types of awards have been granted to executive
officers and other key employees:
Stock Option -- a right to purchase shares of common stock generally
over a ten-year period at the fair market value per share as of the date
the option is granted and vesting in increments over a two or three year
period, so the options provide value to the recipient only when the stock
price increases above the option grant price and the option has become
exercisable; and
Restricted Stock -- shares of common stock which the recipient cannot
sell or otherwise dispose of until the applicable restriction period lapses
and which are forfeited at the Company's election if the recipient
terminates employment for any reason other than retirement, disability or
death prior to the lapsing of the restriction period.
The Committee has typically granted stock options each year pursuant to
shareholder approved plans, and the Committee granted in 1993 the stock options
reflected in the table on page . The allocation for a particular individual
is determined in relation to his total cash compensation, management level and
potential stock price appreciation. Based on management level, each executive is
assigned a targeted range for stock option grant, which ranges for the named
executive officers varied from 31,612 to 130,422 options. The individual range
is determined in relation to total cash compensation, which takes into
consideration the potential value of the stock. Individual assessment of
performance determines the number of options granted in relation to the preset
range. The CEO's stock option grant is determined pursuant to this procedure,
and in 1993 the targeted range for the CEO was 97,816 to 130,422 options with
the awarded grant equaling 100,000 options.
The restricted stock granted in 1993 to the CEO and the other named
executives reflected the successful negotiation by them of an exclusive leased
department concession for extended categories of products over a seven year
period with the Company's major customer. The shares vest over a three to five
year period in equal increments, so the economic benefit to each person is tied
to the future performance of the Company and the
14
<PAGE> 17
contract. The size of each award was based upon a subjective evaluation, and not
subject to specific criteria, of each person's contribution and role in the
process of attaining the contract.
SUBMITTED BY THE COMPENSATION COMMITTEE OF THE COMPANY'S
BOARD OF DIRECTORS: RICHARD BANICK AND ALAN GOSULE
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Banick and Mr. Gosule are non-employee directors who comprise the
Compensation Committee. Mr. Banick and Mr. Gosule are each partners of law firms
which performed in 1993 and currently perform certain legal services for the
Company. Payments for such services are no more favorable than those made to
other law firms used by the Company for comparable services and such payments
are materially less than 5% of the annual revenues of each respective firm.
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors has appointed Deloitte & Touche, independent
accountants, to audit the consolidated financial statements of the Company for
the fiscal year ending January 29, 1995 and recommends that shareholders vote
for ratification of such appointment.
In the event of a negative vote on such ratification of appointment, the
Board of Directors will reconsider its selection. Even if the selection is
ratified, the Board in its discretion may direct the appointment of a new
independent accounting firm at any time during the year, if the Board believes
that such a change would be in the best interests of the Company and its
shareholders.
Deloitte & Touche has audited the Company's financial statements annually
since 1983. Its representatives are expected to be present at the meeting with
the opportunity to make a statement if they desire to do so and are expected to
be available to respond to appropriate questions.
OTHER MATTERS
The Company knows of no other matters to be submitted to the meeting. If
any other matters properly come before the meeting, then the persons named in
the enclosed form of proxy will each have discretionary authority to vote all
proxies with respect thereto in accordance with their judgment.
15
<PAGE> 18
AVAILABLE INFORMATION
The Company files annual reports on Form 10-K with the Securities and
Exchange Commission. A copy of such annual report for the fiscal year ended
December 31, 1993 (except for certain exhibits thereto) may be obtained, free of
charge, upon written request by any shareholder to Jan Bell Marketing, Inc.,
13801 Northwest 14th Street, Sunrise, Florida 33323, Attention: Corporate
Secretary. Copies of all exhibits to the annual report are available upon
similar request, subject to payment of a $0.15 per page charge to reimburse the
Company for its expenses in supplying any exhibit.
THE BOARD OF DIRECTORS
Dated: May 4, 1994
16
<PAGE> 19
PROXY
JAN BELL MARKETING, INC.
13801 N.W. 14TH STREET
SUNRISE, FLORIDA 33323
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Rosemary B. Trudeau and Alan Lipton as
Proxies, each with the power to appoint his/her substitute, and hereby
authorizes each of them to represent and to vote, as designated below, all the
shares of Common Stock of Jan Bell Marketing, Inc. held of record by the
undersigned on April 29, 1994, at the Annual Meeting of Shareholders to be held
on or about June 10, 1994 or any adjournment thereof.
1. ELECTION OF DIRECTORS
<TABLE>
<S> <C>
FOR the nominees listed below (except as marked to the WITHHOLD AUTHORITY
contrary below) to vote for the nominees listed below
</TABLE>
(INSTRUCTION: To withhold authority to vote for an individual nominee, strike a
line through the nominee's name below.)
Peter Hayes Richard Bowers Alan Gosule
2. PROPOSAL TO APPROVE AND RATIFY THE APPOINTMENT OF DELOITTE & TOUCHE
/ / FOR / / AGAINST / / ABSTAIN
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR THE NOMINEES AND FOR PROPOSAL 2.
Please sign exactly as name
appears below. When shares
are held by more than one owner,
all should sign. When signing as
attorney, executor, administrator,
trustee or guardian, please give
full title as such. If a
corporation, please sign in full
corporate name by president or
authorized officer. If a partner-
ship, please sign in partnership
name by authorized person.
DATED: , 1994
-----------------------
(Be sure to date this Proxy)
------------------------------------
Signature
------------------------------------
Signature
