Schedule 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. |_|)
Filed by the registrant |X|
Filed by a party other than the registrant
Check the appropriate box:
|_| Preliminary proxy statement
|_| Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
|X| Definitive proxy statement
|_| Definitive additional materials
|_| Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
Suprema Specialties, Inc.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of filing fee (Check the appropriate box):
|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>
SUPREMA SPECIALTIES, INC.
510 East 35th Street
Paterson, New Jersey 07543
January 16, 2001
Dear Fellow Shareholders:
You are cordially invited to attend the Annual Meeting of Shareholders
which will be held on Tuesday, February 20, 2001 at 9:00 A.M. at the Fort Lee
Hilton, the Abbott Room, 2117 Route 4 East, Fort Lee, New Jersey 07024.
The Notice of Annual Meeting and Proxy Statement which follow describe the
business to be conducted at the meeting.
Whether or not you plan to attend the meeting in person, it is important
that your shares be represented and voted. After reading the enclosed Notice of
Annual Meeting of Shareholders and Proxy Statement, I urge you to complete,
sign, date and return your proxy card in the envelope provided. If the address
on the accompanying material is incorrect, please advise our Transfer Agent,
Continental Stock Transfer & Trust Company, in writing, at 2 Broadway, New York,
New York 10004.
Your vote is very important, and we will appreciate a prompt return of your
signed proxy card. We hope to see you at the meeting.
Cordially,
Mark Cocchiola
Chairman of the Board, Chief
Executive Officer and President
<PAGE>
SUPREMA SPECIALTIES, INC.
510 East 35th Street
Paterson, New Jersey 07543
--------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD FEBRUARY 20, 2001
--------------------
To the Shareholders of SUPREMA SPECIALTIES, INC.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Suprema
Specialties, Inc. (the "Company") will be held on Tuesday, February 20, 2001, at
9:00 A.M. at the Fort Lee Hilton, the Abbott Room, 2117 Route 4 East, Fort Lee,
New Jersey 07024, for the following purposes:
1. To elect six (6) directors to hold office for the terms set forth in the
accompanying proxy statement; and
2. To transact such other business as may properly come before the meeting
or any adjournment or adjournments thereof.
Only shareholders of record at the close of business on January 3, 2001 are
entitled to notice of and to vote at the Annual Meeting or any adjournments
thereof.
By Order of the Board of Directors,
Mark Cocchiola
Chairman of the Board,
Chief Executive Officer and
President
January 16, 2001
--------------------------------------------------------------------------------
IF YOU DO NOT EXPECT TO BE PRESENT AT THE MEETING:
PLEASE FILL IN, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE ENVELOPE
PROVIDED FOR THAT PURPOSE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES. THE PROXY MAY BE REVOKED AT ANY TIME PRIOR TO EXERCISE, AND IF YOU ARE
PRESENT AT THE MEETING YOU MAY, IF YOU WISH, REVOKE YOUR PROXY AT THAT TIME AND
EXERCISE THE RIGHT TO VOTE YOUR SHARES PERSONALLY.
--------------------------------------------------------------------------------
<PAGE>
PROXY STATEMENT
SUPREMA SPECIALTIES, INC.
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD FEBRUARY 20, 2001
This proxy statement is furnished in connection with the solicitation of
proxies by the Board of Directors of SUPREMA SPECIALTIES, INC. (the "Company")
for use at the Annual Meeting of Shareholders to be held on February 20, 2001,
including any adjournment or adjournments thereof (the "Annual Meeting"), for
the purposes set forth in the accompanying Notice of Meeting.
Management intends to mail this proxy statement and the accompanying form
of proxy to shareholders on or about January 17, 2001.
Proxies in the accompanying form, duly executed and returned to the Company
and not revoked, will be voted at the Annual Meeting. Any proxy given pursuant
to such solicitation may be revoked by the shareholder at any time prior to the
voting of the proxy by a subsequently dated proxy, by written notification to
the Secretary of the Company, or by personally withdrawing the proxy at the
Annual Meeting and voting in person.
The address and telephone number of the principal executive offices of the
Company are:
510 East 35th Street
Paterson, New Jersey 07543
Telephone No.: (973) 684-2900
OUTSTANDING STOCK AND VOTING RIGHTS
Only shareholders of record at the close of business on January 3, 2001
(the "Record Date") are entitled to notice of, and to vote at, the Annual
Meeting. As of the Record Date, there were issued and outstanding 5,622,193
shares of the Company's Common Stock, par value $.01 per share (the "Common
Stock"), the Company's only class of voting securities. Each share entitles the
holder to one vote on each matter submitted to a vote at the Annual Meeting.
Cumulative voting is not permitted.
<PAGE>
VOTING PROCEDURES
The directors will be elected by the affirmative vote of a plurality of the
shares of Common Stock present in person or represented by proxy at the Annual
Meeting, provided a quorum exists. Any other matters presented at the Annual
Meeting will be decided by a majority of the votes cast by the holders of shares
of Common Stock present in person or represented by proxy at the Annual Meeting,
provided a quorum exists. Votes will be counted and certified by an Inspector of
Election who is expected to be an employee of Continental Stock Transfer & Trust
Company, the transfer agent for the Common Stock. A quorum will exist at the
Annual Meeting if at least a majority of the outstanding shares of Common Stock
as of the Record Date are present in person or represented by proxy. Based upon
the Company's understanding of the requirements of the laws of the State of New
York and the Company's Certificate of Incorporation and By-laws, "votes cast" at
a meeting of shareholders by the holders of shares entitled to vote are
determinative of the outcome of the matter to be voted on; failures to vote,
broker non-votes and abstentions will not be considered "votes cast."
The enclosed proxies will be voted in accordance with the instructions
thereon. Unless otherwise stated, all shares represented by such proxies will be
voted as instructed. Proxies may be revoked as noted above.
2
<PAGE>
ELECTION OF DIRECTORS
(Item No. 1)
Directors are elected annually by the shareholders. At this year's Annual
Meeting of Shareholders, six (6) directors will be elected to hold office for a
term expiring at the Annual Meeting of Shareholders for the fiscal year ending
June 30, 2001. Each director will be elected to serve until a successor is
elected and qualified or until the director's earlier resignation or removal.
At this year's Annual Meeting of Shareholders, the proxies granted by
shareholders will be voted individually for the election as directors of the
Company of the persons listed below, unless a proxy specifies that it is not to
be voted in favor of a nominee for director. In the event any of the nominees
listed below shall be unable to serve, it is intended that the proxy will be
voted for such other nominees as are designated by the Board of Directors. Each
of the persons named below has indicated to the Board of Directors of the
Company that he will be available to serve.
Name Age Position with Company
---- --- ---------------------
Mark Cocchiola 44 Chairman of the Board, Chief Executive
Officer and President
Paul Lauriero 49 Executive Vice President
and Director
Marco Cocchiola 76 Director
Dr. Rudolph Acosta, Jr. 45 Director
Paul DeSocio 58 Director
Barry S. Rutcofsky 43 Director Nominee
Mark Cocchiola has been President and a director of the Company since its
inception in 1983 and Chairman of the Board and Chief Executive Officer since
February 1991. Mark Cocchiola is the son of Marco Cocchiola.
Paul Lauriero has been a director of the Company since its inception in
1983 and Executive Vice President since February 1991. Mr. Lauriero was employed
by the Company in various capacities from its inception in 1983. Mr. Lauriero is
the brother-in-law of Mark Cocchiola.
3
<PAGE>
Marco Cocchiola has been a director of the Company since February 1991 and
Operations Manager since the Company's inception in 1983. Mr. Cocchiola was
Secretary of the Company from February 1991 to June 1993. Marco Cocchiola is the
father of Mark Cocchiola.
Rudolph Acosta, Jr., M.D. has been a director of the Company since August
1993. He has been engaged in the private practice of medicine since August 1986.
Paul DeSocio has been a director of the Company since August 1993. He has
been the President and a director of Autoprod, Inc., a manufacturer of food
packaging machinery since May 1989. From 1980 through May 1989, Mr. DeSocio was
a Vice President of Autoprod, Inc.
Barry S. Rutcofsky, has served as the Co-Chairman of the Board of Directors
of Take-Two Interactive Software, Inc., a developer, publisher and distributor
of interactive software games since July 2000 and was President of Take-Two
Interactive from August 1999 to July 2000. Prior to joining Take-Two, Mr.
Rutcofsky was a partner of the New York law firm of Tenzer Greenblatt LLP (now
known as Blank Rome Tenzer Greenblatt LLP). Mr. Rutcofsky joined Tenzer
Greenblatt LLP in April 1987.
Compensation of Directors
Non-employee directors receive compensation in the amount of $500 for each
meeting attended in person and $250 for each meeting attended by telephone
conference call for serving on the Board of Directors. Directors are reimbursed
for all out-of-pocket expenses incurred in attending Board meetings.
In addition, under the Company's 1991 and 1998 Stock Option Plans and its
1999 Stock Incentive Plan (collectively, the "Plans"), non-employee directors
(other than directors who become members of a stock option committee appointed
by the Board of Directors pursuant to the Plans) are eligible to be granted
nonqualified stock options ("NSOs"). The Board of Directors, or the stock option
committee (the "Committee"), if one is appointed by the Board, has discretion to
determine the number of shares subject to each NSO (subject to the number of
shares available for grant under the Plans), the exercise price thereof
(provided such price is not less than 100% of the fair market value of the
underlying shares on the date of grant), the term thereof (but not in excess of
10 years from the date of
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<PAGE>
grant) and the manner in which the option becomes exercisable (amounts,
intervals and other conditions). Directors who are employees (and are not
members of the Committee) are eligible to be granted incentive stock options
("ISOs") and NSOs under the Plans. The Board or the Committee, as the case may
be, has discretion to determine the number of shares subject to each ISO, the
exercise price and other terms and conditions thereof, but their discretion as
to the exercise price, the term of each ISO and the number of ISOs that may vest
in any year, is limited by the terms of the Plans and the Internal Revenue Code
of 1986, as amended. In addition, the 1999 Stock Incentive Plan also provides
for the grant of other stock-based awards as may be determined by the Board or
the Committee.
Meetings of the Board of Directors and Board Committees
During the fiscal year ended June 30, 2000, the Board of Directors held
five meetings at which all of the Directors were present and also took action by
unanimous written consents of the directors in lieu of meetings. The Board of
Directors has a Compensation Committee that is currently composed of Dr. Rudolph
Acosta, Jr., Mr. Paul DeSocio, and Mr. William Gascoigne. The function of the
Compensation Committee is to evaluate the compensation of the Company's
executive officers pursuant to recommendations made by Mark Cocchiola, the
Company's Chief Executive Officer and President and make recommendations to the
Board of Directors regarding executive compensation. The Compensation Committee
met one time during the fiscal year ended June 30, 2000. The Board of Directors
has an Audit Committee that is currently composed of Mr. Mark Cocchiola, Dr.
Rudolph Acosta, Jr., Mr. Paul DeSocio and Mr. William Gascoigne. The function of
the Audit Committee is to supervise the audit and financial procedures of the
Company. A copy of the Audit Committee's charter is attached hereto as Appendix
A. The Audit Committee held four meetings during the fiscal year ended June 30,
2000. It is anticipated that upon completion of the election of directors at the
Annual Meeting the members of the Audit Committee will consist of Messrs.
Acosta, DeSocio and Rutcofsky, all of whom meet the independence requirements
under current National Association of Securities Dealers corporate governance
standards. It is also anticipated that Mr. Rutcofsky will be appointed to the
Compensation Committee to fill the vacancy created by the departure of Mr.
Gascoigne whose term as a director expires at this Annual Meeting.
5
<PAGE>
Audit Committee Report
The Audit Committee has met with management to review and discuss the
audited financial statements for the year ended June 30, 2000. The Audit
Committee also conducted discussions with its independent auditors, BDO Seidman,
LLP, regarding the matters required by the Statement on Auditing Standards No.
61. As required by Independence Standards Board Standard No. 1, "Independence
Discussion with Audit Committees," the Audit Committee has discussed with and
received the required written disclosures and confirming letter from BDO
Seidman, LLP regarding its independence and has discussed with BDO Seidman, LLP
its independence. Based upon the review and discussions referred to above, the
Audit Committee recommended to the Board of Directors that the audited financial
statements be included in the Company's Annual Report on Form 10-K for the year
ended June 30, 2000.
This Audit Committee Report shall not be deemed incorporated by reference
in any document previously or subsequently filed with the Securities and
Exchange Commission that incorporates by reference all or any portion of this
proxy statement, except to the extent that the Company specifically requests
that the Report be specifically incorporated by reference.
The Audit Committee
Mark Cocchiola
Dr. Rudolph Acosta, Jr.
Paul DeSocio
William Gascoigne
6
<PAGE>
EXECUTIVE OFFICERS
In addition to Mr. Mark Cocchiola and Mr. Paul Lauriero, the Company's
executive officers include Messrs. Steven Venechanos, Thomas F. Egan and Anthony
Distinti. Officers are elected annually by the Board of Directors and serve at
the discretion of the Board.
Steven Venechanos, age 41, has been employed by the Company since April
1994 and became Chief Financial Officer and Secretary of the Company in April
1995. From June 1990 until joining the Company, he was employed in a variety of
positions at Breed Technologies, a manufacturer of airbag sensors.
Thomas Egan, age 59, has been Vice President of the Company since May 1993
and Senior Vice President since June 1995. From May 1992 through May 1993, he
was Sales Manager of Blue Ridge Farms, a salad manufacturer. From October 1990
through May 1992, Mr. Egan was President of TEF Sales Corp., a sales and
marketing consulting firm specializing in the cheese importing business.
Anthony Distinti, age 81, has been Vice President of Human Resources of the
Company since November 1997. Mr. Distinti has been employed in the food industry
most of his life in various capacities and has more than forty years experience
in human resources.
7
<PAGE>
EXECUTIVE COMPENSATION
The following table discloses for the fiscal years ended June 30, 2000,
1999 and 1998, compensation awarded during such fiscal years to Mark Cocchiola,
the Company's Chief Executive Officer, Paul Lauriero, the Company's Executive
Vice President, Thomas Egan, the Company's Senior Vice President, Steven
Venechanos, the Company's Chief Financial Officer and Anthony Distinti, the
Company's Vice President (collectively, the "Named Executives"), who are the
only executive officers of the Company whose salary and bonus exceeded $100,000
during the fiscal year ended June 30, 2000 ("fiscal 2000").
<TABLE>
<CAPTION>
Summary Compensation Table
---------------------------------------------
Annual Compensation Long Term Compensation
--------------------------------- --------------------------------
Securities All
Underlying Other
Name and Principal Position Year Salary($) Bonus($) Options(#) Compensation($)*
--------------------------- ---- --------- -------- ---------- ----------------
<S> <C> <C> <C> <C> <C>
Mark Cocchiola, 2000 $250,000 $508,594 100,000 $ 15,615
Chairman of the Board, 1999 $252,700 $324,201 50,000 $ 15,010
Chief Executive 1998 $254,542 $175,852 75,000(1) $ 17,674
Officer and President
Paul Lauriero 2000 $250,000 $508,594 100,000 $ 13,679
Executive Vice President 1999 $252,700 $324,201 50,000 $ 12,648
1998 $254,542 $175,852 155,000(2) $ 17,674
Thomas Egan 2000 $153,750 $ -- 15,000 $ 9,196
Senior Vice President 1999 $133,077 $ -- 30,000 $ 6,600
1998 $125,000 $ -- 55,000(3) $ 6,600
Steven Venechanos 2000 $153,750 $ -- 25,000 $ 13,500
Chief Financial Officer 1999 $120,000 $ -- 30,000 $ 6,000
and Secretary 1998 $101,250 $ -- 100,000(4) $ 6,000
Anthony Distinti 2000 $119,731 $ -- -- --
Vice President 1999 $ 96,500 $ -- -- --
1998 $ 74,000 $ -- 10,000 --
</TABLE>
* Consists of automobile allowance, medical insurance premium reimbursement and
compensation paid in lieu of vacation.
----------
(1) Includes a total of 100,000 options that were previously granted in the
fiscal years ended June 30, 1996 and 1997 and were repriced in fiscal 1998.
8
<PAGE>
(2) Includes a total of 80,000 options that were previously granted in the
fiscal years ended June 30, 1996 and 1997 and were repriced in fiscal 1998.
(3) Includes a total of 30,000 options that were previously granted in the
fiscal years ended June 30, 1994 and 1997 and were repriced in fiscal 1998.
(4) Includes a total of 50,000 options that were previously granted in the
fiscal years ended June 30, 1996 and 1997 and were repriced in fiscal 1998.
The following table discloses information concerning options granted in fiscal
2000 to the Named Executives.
<TABLE>
<CAPTION>
Option Grants in Fiscal Year Ended June 30, 2000
--------------------------------------------------------------------------------------------------
Individual Grants
-----------------------------------------------
Number of
Securities Percent of Total Potential Realizable Value at
Underlying Options Granted to Exercise Assumed Annual Rates of Stock
Options Granted Employees in Fiscal Price Price Appreciation for Option
(#)(1) Year ($/Sh) Expiration Date Term (1)(2)
-------------------- --------------- ------------------- -------- --------------- -----------------------------
5% ($) 10% ($)
------ -------
<S> <C> <C> <C> <C> <C> <C>
Mark Cocchiola 100,000 28.8 7.75 12/30/09 487,393 1,235,150
Paul Lauriero 100,000 28.8 7.75 12/30/09 487,393 1,235,150
Thomas Egan 15,000 4.3 7.75 1/30/10 73,110 185,268
Steven Venechanos 25,000 7.2 7.75 1/30/10 121,849 308,779
</TABLE>
----------
(1) The options granted to Messrs. Cocchiola and Lauriero were exercisable in
full from the date of grant. The options granted to Mr. Egan and Mr.
Venechanos vest in three annual installments commencing one year from the
original date of grant of the options.
(2) The potential realizable value columns of the table illustrate values that
might be realized upon exercise of the options immediately prior to their
expiration, assuming the Common Stock appreciates at the compounded rates
specified over the term of the options. These numbers do not take into
account provisions of options providing for termination of the option
following termination of employment or nontransferability of the options
and do not make any provision for taxes associated with exercise. Because
actual gains will depend upon, among other things, future performance of
the Common Stock, there can be no assurance that the amounts reflected in
this table will be achieved.
9
<PAGE>
The following table sets forth information concerning the number of options
owned by the Named Executives and the value of unexercised stock options held by
the Named Executives as of June 30, 2000. No stock options were exercised by the
Named Executives during fiscal 2000.
<TABLE>
<CAPTION>
Aggregate Year-End Option Values
------------------------------------------------
Number of Value of
Securities Underlying Unexercised
Unexercised Options In-the-Money Options
at June 30, 2000 at June 30, 2000($)(1)
------------------------------ ----------------------------
Shares Acquired Value Realized
Name on Exercise (#) ($) Exercisable Unexercisable Exercisable Unexercisable
---- --------------- --- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mark Cocchiola 0 0 375,000 0 1,811,853 0
Paul Lauriero 0 0 355,000 0 1,692,093 0
Thomas Egan 0 0 66,667 48,333 395,833 233,884
Steve Venechanos 0 0 96,334 61,666 574,040 273,882
Anthony Distinti 0 0 6,667 3,333 39,922 21,248
</TABLE>
----------
(1) Year-end values for unexercised in-the-money options represent the positive
spread between the exercise price of such options and the fiscal year end
market value of the common stock. An Option is "in-the-money" if the fiscal
year end fair market value of the Common Stock exceeds the option exercise
price. The last sale price (the fair market value) of the Common Stock on
June 30, 2000 was $9.375 per share.
Employment Agreements
Each of Mark Cocchiola and Paul Lauriero has entered into an employment
agreement with the Company that currently expires in April 2002. Each agreement
provides for the full-time employment of the executive at an annual salary of
$250,000, subject to adjustment for cost of living increases, and an annual
bonus equal to 5% of the Company's pre-tax profits in excess of $650,000.
Messrs. Mark Cocchiola and Lauriero each received bonuses of $175,852 in fiscal
1998, $324,201 in fiscal 1999 and $508,574 in fiscal 2000. Each agreement
provides that the executive will not compete with the Company during the term of
his employment and for a period of one year following termination thereof by
either the Company or the executive for any reason. Each of the agreements also
provides that if employment of the executive is terminated under certain
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<PAGE>
circumstances, including a "change of control," he will be entitled to receive
severance pay equal to the higher of (i) $150,000 ($450,000 in the event of a
change of control) or (ii) the total compensation paid to him by the Company
during the 12 month period (36 month period in the event of a change of control)
prior to the date of termination.
Compensation Committee Interlocks and
Insider Participation In Compensation Decisions
The Company has established a Compensation Committee that is currently
comprised of Dr. Rudolph Acosta, Jr., Mr. Paul DeSocio and Mr. William
Gascoigne. The function of the Compensation Committee is to evaluate and
determine the compensation of the Company's executive officers pursuant to
recommendations made by Mark Cocchiola, the Company's Chief Executive Officer.
During fiscal 2000, none of the executive officers of the Company served on the
Board of Directors or the compensation committee of any other entity, any of
whose executive officers served on the Compensation Committee or Board of
Directors of the Company.
Report on Executive Compensation
As noted above, the function of the Compensation Committee is to evaluate
and determine compensation of the Company's executive officers pursuant to
recommendations made by Mark Cocchiola, the Company's Chief Executive Officer.
There is no formal compensation policy for the Company's executive officers,
other than the existing employment agreements between the Company and each of
Messrs. Mark Cocchiola and Paul Lauriero.
Total compensation for executive officers consists of a combination of base
salaries, bonuses and stock option awards. The salaries of the Named Executives
are fixed annually by the Compensation Committee subject to the terms of any
employment agreements between the Named Executives and the Company. Annual
bonuses to the Named Executives are based generally on the Company's performance
and available resources. Base salary and bonus compensation of the other
executive officers is based on the Company's financial performance and the
executive's individual performance and level of responsibility. Stock option or
other stock-based awards, as the case may be, under the Company's 1991 Stock
Option Plan, 1998 Stock Option Plan and its 1999 Stock Incentive Plan are
intended to attract, motivate and retain senior management personnel by
affording them an
11
<PAGE>
opportunity to receive additional compensation based upon the performance of the
Company's Common Stock.
During fiscal 2000, options to purchase 100,000, 100,000, 15,000 and 25,000
shares of Common Stock, respectively, were granted under the Plans to Mark
Cocchiola, Paul Lauriero, Thomas Egan and Steven Venechanos, respectively, at
$7.75 per share. For fiscal 2000, the Company had net sales of approximately
$278,000,000 and net income of approximately $6,400,000, compared to net sales
of approximately $176,000,000, and net income of approximately $4,200,000, for
fiscal 1999.
The Compensation Committee
Dr. Rudolph Acosta, Jr.
Paul DeSocio
William C. Gascoigne
12
<PAGE>
Stock Performance Graph
The following line graph compares, from June 30, 1995 through June 30,
2000, the cumulative total return among the Company, companies comprising the
Russell 2000 Index and a Peer Group Index, based on an investment of $100 on
June 30, 1995, in the Company's Common Stock and each index, and assuming
reinvestment of all dividends, if any, paid on such securities. The Company has
not paid any dividends and, therefore, the cumulative total return calculation
for the Company is based solely upon stock price appreciation. The Peer Group
Index consists of companies in the food business. These companies are: Dean
Foods Co., Farmer Brothers Co., Golden Enterprises, Inc., Lifeway Foods, Inc.,
Michael Foods, Inc., Tofutti Brands, Inc., and Universal Foods Corp. (d/b/a
Sensient Technologies Corporation). Historic stock price is not necessarily
indicative of future stock price performance.
COMPARISON OF CUMULATIVE TOTAL RETURN
SUPREMA SPECIALTIES, INC., RUSSELL 2000 INDEX
AND PEER GROUP INDEX
<TABLE>
<CAPTION>
6/30/95 6/30/96 6/30/97 6/30/98 6/30/99 6/30/00
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
The Company $100.00 $184.62 $111.54 $115.38 $213.46 $288.46
----------------------------------------------------------------------------------------------
Russell 100.00 124.01 144.25 168.03 168.95 190.65
2000
Index
----------------------------------------------------------------------------------------------
Peer Group 100.00 104.45 139.38 191.42 160.82 138.78
----------------------------------------------------------------------------------------------
</TABLE>
13
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VOTING SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of the Record Date,
based on information obtained from the persons named below, with respect to the
beneficial ownership of shares of Common Stock by (i) each person known by the
Company to be the beneficial owner of more than five percent of the outstanding
shares of Common Stock, (ii) each of the Named Executives, (iii) each of the
Company's directors and each nominee for director and (iv) all executive
officers and directors as a group:
Amount and Natur Percentage of
Name and Address of of Beneficial Outstanding
Beneficial Owner(1) Ownership(2) Shares Owned(3)
------------------- ------------ ---------------
Mark Cocchiola 900,635(4) 15.0%
Paul Lauriero 575,619(5) 9.6
Marco Cocchiola 88,412(6) 1.6
Steve Venechanos 111,333(7) 1.9
Thomas Egan 73,333(7) 1.3
Anthony Distinti 6,666(7) *
Dr. Rudolph Acosta 4,667(7)(8) *
Paul DeSocio 1,667(7) *
Barry S. Rutcofsky -- --
William G. Gascoigne 1,667(7) *
FMR Corp. 506,100(9) 9.0
All executive officers
and directors as a group
(nine persons) 1,763,999(10) 26.6
----------
* Less than one percent.
14
<PAGE>
(1) Unless otherwise noted, the address of each beneficial owner is in care of
the Company.
(2) Unless otherwise noted, the Company believes that all persons referred to
in the table have sole voting and investment power with respect to all
shares of Common Stock reflected as beneficially owned by them.
(3) Calculated based on 5,622,193 shares of Common Stock outstanding at the
Record Date. The applicable percentage is based on options to purchase
Common Stock which are currently exercisable or become exercisable within
60 days of such date.
(4) Includes (i) 375,000 shares that may be purchased upon exercise of
exercisable options owned by Mr. Cocchiola, (ii) 8,333 shares that may be
purchased upon exercise of exercisable options owned by Mr. Cocchiola's
wife and (iii) 2,000 shares held of record by Mr. Cocchiola's wife.
(5) Includes (i) 355,000 shares that may be purchased upon exercise of
exercisable options owned by Mr. Lauriero, (ii) 22,539 shares held of
record by Mr. Lauriero's wife, and (iii) 45,079 shares held of record by
Mr. Lauriero's children.
(6) Includes 83,333 shares that may be purchased upon exercise of exercisable
options.
(7) Represents shares that may be purchased upon exercise of exercisable
options.
(8) Does not include 800 shares owned by Dr. Acosta's children, with respect to
which Dr. Acosta disclaims any beneficial interest.
(9) The address of FMR Corp. is 82 Devonshire Street, Boston, MA 02109.
According to information provided to the Company by FMR Corp., Fidelity
Management and Research Company, 82 Devonshire Street, Boston, MA 02109, a
wholly-owned subsidiary of FMR Corp. and an investment adviser registered
under Section 203 of the Investment Advisers Act of 1940, may also be
deemed the beneficial owner of the 506,100 shares as a result of acting as
an investment adviser to various investment companies registered under
Section 8 of the Investment Company Act of 1940.
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(10) Includes 1,020,999 shares issuable upon exercise of options beneficially
owned by the Company's officers and directors of which 1,667 are owned by
William Gascoigne whose term as a director expires at the Annual Meeting.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
BDO Seidman, LLP has audited and reported upon the financial statements of
the Company for the fiscal year ended June 30, 2000 and it is currently
anticipated that BDO Seidman, LLP will be selected by the Board of Directors to
examine and report upon the financial statements of the Company for the fiscal
year ending June 30, 2001. A representative of BDO Seidman, LLP is expected to
be present at the Annual Meeting with the opportunity to make a statement if he
or she desires to do so and is expected to be available to respond to
appropriate questions.
SHAREHOLDER PROPOSALS FOR NEXT ANNUAL SHAREHOLDER MEETING
The Company currently anticipates that its Annual Meeting of Shareholders
with respect to the Company's fiscal year ending June 30, 2001 will be held
between the months of November 2001 and December 2001. Therefore, shareholders
who wish to present proposals appropriate for consideration at the Company's
Annual Meeting of Shareholders with respect to the Company's fiscal year ending
June 30, 2001 must submit the proposal in proper form and in satisfaction of the
conditions established by the Securities Exchange Commission, to the Company at
its address set forth on the first page of this Proxy Statement not later than
July 31, 2001 in order for the proposition to be considered for inclusion in the
Company's proxy statement and form of proxy relating to such annual meeting. Any
such proposals, as well as any questions related thereto, should be directed to
the Secretary of the Company.
After the July 31, 2001 deadline, a shareholder may present a proposal at
the Company's next Annual Meeting if it is submitted to the Company's Secretary
at the address set forth above no later than August 31, 2001, If timely
submitted, the shareholder may present the proposal at the next Annual Meeting
but the Company is not obligated to present the matter in its proxy statement.
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OTHER INFORMATION
Proxies for the Annual Meeting will be solicited by mail and through
brokerage institutions and all expenses involved, including printing and
postage, will be paid by the Company.
A COPY OF THE COMPANY'S ANNUAL REPORT FOR THE YEAR ENDED JUNE 30, 2000 IS
BEING FURNISHED HEREWITH TO EACH SHAREHOLDER OF RECORD AS OF THE CLOSE OF
BUSINESS ON JANUARY 3, 2001. ADDITIONAL COPIES OF THE ANNUAL REPORT WILL BE
PROVIDED FOR A NOMINAL CHARGE UPON WRITTEN REQUEST TO:
SUPREMA SPECIALTIES, INC.
P.O. BOX 280
PATERSON, NEW JERSEY 07543-0280
ATTENTION: Steven Venechanos, Secretary
The Board of Directors is aware of no other matters, except for those
incident to the conduct of the Annual Meeting, that are to be presented to
shareholders for formal action at the Annual Meeting. If, however, any other
matters properly come before the Annual Meeting or any adjournments thereof, it
is the intention of the persons named in the proxy to vote the proxy in
accordance with their judgment.
By order of the Board of Directors,
Mark Cocchiola
Chairman of the Board, Chief
Executive Officer and President
January 16, 2001
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APPENDIX A
AUDIT COMMITTEE CHARTER
FOR
SUPREMA SPECIALTIES, INC.
Composition
There shall be a committee of the board of directors (the "Board") of Suprema
Specialties, Inc. (the "Company") to be known as the audit committee which, no
later than June 14, 2001, shall have at least three (3) members, comprised
solely of independent directors, as such term is defined in Marketplace Rule
4200(a)(15) of the National Association of Securities Dealer's, Inc. ("NASD")
listing standards, subject to the exception in NASD Marketplace Rule
4350(d)(2)(B).
Each member of the audit committee shall be able to read and understand
fundamental financial statements, including the Company's balance sheet, income
statement and cash flow statement or will become able to do so within a
reasonable period of time after his or her appointment to the audit committee.
In addition, at least one member of the audit committee shall have past
employment experience in finance or accounting, requisite professional
certification in accounting or any other comparable experience or background
which results in the individual's financial sophistication, including being or
having been a chief executive officer, chief financial officer or other senior
officer with financial oversight responsibilities.
The Board shall elect or appoint a chairperson of the audit committee who will
have authority to act on behalf of the audit committee between meetings.
Responsibilities
The responsibilities of the audit committee are as follows:
o Ensure its receipt from the outside auditor of a formal written
statement, delineating all relationships between the outside auditor
and the Company consistent with the Independence Standards Board
Standard 1.
o Actively engage in a dialogue with the outside auditor with respect to
any disclosed relationships or services that may impact the
objectivity and independence of the outside auditor and be responsible
for taking, or recommending that the Board take, appropriate action to
oversee the independence of the outside auditor.
o In view of the outside auditor's ultimate accountability to the Board
and the audit
A-1
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committee, as representatives of the shareholders, the audit
committee, acting together with the Board, has the ultimate authority
and responsibility to select, evaluate, and, where appropriate,
replace the outside auditor (or nominate an outside auditor for
shareholder approval in any Company proxy statement).
o Review with the outside auditor, the Company's internal auditor (if
any), and financial and accounting personnel, the adequacy and
effectiveness of the accounting and financial controls of the Company,
and elicit any recommendations for the improvement of such internal
control procedures or particular areas where new or more detailed
controls or procedures are desirable.
o Consider, in consultation with the outside auditor and management of
the Company, the audit scope and procedures.
o Review the financial statements contained in the annual report to
shareholders with management and the outside auditor to determine that
the outside auditor is satisfied with the disclosure and content of
the financial statements to be presented to the shareholders.
o Meet with the internal auditor (if any), outside auditor or the
management privately to discuss any matters that the audit committee,
the internal auditor (if any), the outside auditor or the management
believe should be discussed privately with the audit committee.
o Review and reassess the adequacy of the committee's charter annually.
o Prepare a report of the audit committee to be included in the
Company's proxy statement in accordance with applicable Securities and
Exchange Commission regulations.
o Make such other recommendations to the Board on such matters, within
the scope of its functions, as may come to its attention and which in
its discretion warrant consideration by the Board.
Limitations
The audit committee is responsible for the duties set forth in this charter but
is not responsible for either the preparation of the financial statements or the
auditing of the financial statements. Management has the responsibility for
preparing the financial statements and implementing internal controls and the
independent accountants have the responsibility for auditing the financial
statements and monitoring the effectiveness of the internal controls. The review
of the financial statements by the audit committee is not an audit nor is it of
the same quality as an audit. The audit is conducted by the Company's
independent outside auditors. In carrying out its responsibilities, the audit
committee believes its policies and procedures should remain flexible in order
to best react to a changing environment.
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SUPREMA SPECIALTIES, INC.
510 East 35th Street
Paterson, New Jersey 07543
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS TO BE HELD FEBRUARY 20, 2001
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Mark Cocchiola and Paul Lauriero, and each
of them, Proxies, with full power of substitution in each of them, in the name,
place and stead of the undersigned, to vote at the Annual Meeting of
Shareholders of Suprema Specialties, Inc. on Tuesday, February 20, 2001, at the
Fort Lee Hilton, the Abbott Room, 2117 Route 4 East, Fort Lee, New Jersey 07024,
or at any adjournment or adjournments thereof, according to the number of votes
that the undersigned would be entitled to vote if personally present, upon the
following matters:
1. ELECTION OF DIRECTORS:
<TABLE>
<S> <C>
|_| FOR all nominees listed below |_| WITHHOLD AUTHORITY
(except as marked to the contrary below). to vote for all nominees listed below.
</TABLE>
Mark Cocchiola, Paul Lauriero, Marco Cocchiola, Dr. Rudolph Acosta, Jr.,
Paul DeSocio and Barry S. Rutcofsky
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space below.)
--------------------------------------------------------------------------------
(Continued and to be signed on reverse side)
<PAGE>
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE INSTRUCTIONS GIVEN ABOVE.
IF NO INSTRUCTIONS ARE GIVEN, THIS PROXY WILL BE VOTED "FOR" ALL BOARD
NOMINEES LISTED ABOVE.
DATED: _______________________, 2001
Please sign exactly as name appears
hereon. When shares are held by joint
tenants, both 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 other authorized officer. If a
partnership, please sign in partnership
name by authorized person.
---------------------------------------
Signature
---------------------------------------
Signature if held jointly
Please mark, sign, date and return this proxy card promptly
using the enclosed envelope.
