JOHN B. SANFILIPPO & SON, INC.
------------------------------
2299 Busse Road
Elk Grove Village, Illinois 60007
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
----------------------------------------
to be held
on October 27, 1999
TO THE STOCKHOLDERS:
The annual meeting of stockholders of John B. Sanfilippo & Son,
Inc. (the "Company") will be held on Wednesday, October 27, 1999
at 10:00 a.m., local time, at the Wyndham Hotel Northwest Chicago,
400 Park Boulevard, Itasca, Illinois 60143, for the following
purposes:
1. To elect directors;
2. To ratify the action of the Board of Directors in appointing
PricewaterhouseCoopers LLP as the Company's independent
accountants for the fiscal year ending June 29, 2000; and
3. To transact such other business as may properly be brought
before the annual meeting or any adjournment or postponement
thereof.
The annual meeting may be postponed or adjourned from time to time
without any notice other than announcement at the meeting, and any
and all business for which notice is hereby given may be
transacted at any such postponed or adjourned meeting.
The Board of Directors has fixed the close of business on
September 10, 1999 as the record date for determination of
stockholders entitled to notice of and to vote at the annual
meeting.
Stockholders are requested to complete and sign the enclosed
proxy, which is solicited by the Board of Directors, and promptly
return it in the accompanying envelope whether or not they plan to
attend the annual meeting in person. The proxy is revocable at
any time before it is voted. Returning the proxy will in no way
limit your right to vote at the annual meeting if you should later
decide to attend and vote in person.
Because two classes of stock of the Company are now outstanding, a
separate form of proxy has been prepared with respect to each
class of stock: a white proxy, which relates to the Company's
Common Stock, $.01 par value, and a blue proxy, which relates to
the Company's Class A Common Stock, $.01 par value. Stockholders
who own of record shares of only one class are being furnished
only with the proxy relating to that class. Stockholders who own
of record shares of both classes are being furnished with both
proxies (in separate mailings, each of which also includes a copy
of this notice and the proxy statement). Stockholders who receive
both proxies must complete, sign and return both proxies in order
for the shares of both classes to be voted by proxy.
By Order of the Board of Directors
/s/ MICHAEL J. VALENTINE
------------------------
MICHAEL J. VALENTINE
Secretary
Elk Grove Village, Illinois
September 15, 1999
JOHN B. SANFILIPPO & SON, INC.
- ------------------------------
PROXY STATEMENT
- ---------------
ANNUAL MEETING OF STOCKHOLDERS
- ------------------------------
October 27, 1999
This Proxy Statement is furnished in connection with the
solicitation by the Board of Directors of John B. Sanfilippo &
Son, Inc., a Delaware corporation, of proxies for use at the
annual meeting of stockholders of the Company to be held on
Wednesday, October 27, 1999 at 10:00 a.m., local time, at the
Wyndham Hotel Northwest Chicago, 400 Park Boulevard, Itasca,
Illinois 60143, and at any postponement or adjournment thereof
(the "Annual Meeting"). All shares of the Company's Common Stock,
$.01 par value (the "Common Stock"), and the Company's Class A
Common Stock, $.01 par value (the "Class A Stock"), entitled to
vote at the Annual Meeting which are represented by properly
executed proxies will, unless such proxies have been revoked, be
voted in accordance with the instructions given in such proxies.
Any stockholder who has given a proxy may revoke it at any time
prior to its exercise at the Annual Meeting by delivering a
written notice of revocation or a duly executed proxy bearing a
later date to the Secretary of the Company, or by attending the
Annual Meeting and voting in person. Any written notice of
revocation or subsequent proxy should be delivered to the Company
at 2299 Busse Road, Elk Grove Village, Illinois 60007, Attention:
Secretary, or hand delivered to the Secretary, before the closing
of the polls at the Annual Meeting. Unless the context otherwise
requires, references herein to the "Company" refer to John B.
Sanfilippo & Son, Inc. and its subsidiaries.
This Proxy Statement and accompanying proxy are being mailed to
stockholders on or about September 15, 1999. The mailing address
of the principal executive offices of the Company is 2299 Busse
Road, Elk Grove Village, Illinois 60007.
RECORD DATE AND SHARES OUTSTANDING
- ----------------------------------
The Company had outstanding on September 10, 1999, the record date
for determination of stockholders entitled to notice of and to
vote at the Annual Meeting, 5,461,139 shares of Common Stock
(excluding 117,900 treasury shares) and 3,687,426 shares of
Class A Stock. The Common Stock is traded on the Nasdaq National
Market. There is no established public trading market for the
Class A Stock.
VOTING AND QUORUM
- -----------------
Pursuant to the Company's Restated Certificate of Incorporation
(the "Restated Certificate"), so long as the total number of
shares of Class A Stock outstanding is greater than or equal to
12.5% of the total number of shares of Class A Stock and Common
Stock outstanding, generally the holders of Common Stock voting as
a class are entitled to elect such number (rounded to the next
highest number in the case of a fraction) of directors as equals
25% of the total number of directors constituting the full Board
of Directors and the holders of Class A Stock voting as a class
are entitled to elect the remaining directors. The holders of
Common Stock are not entitled to cumulative voting. In connection
with the election of directors, however, each holder of Class A
Stock has the right, in person or by proxy, to either (a) vote the
number of shares of Class A Stock owned by such holder for as many
persons as there are directors to be elected by holders of Class A
Stock ("Class A Directors"), or (b) cumulate said votes (by
multiplying the number of shares of Class A Stock owned by such
holder by the number of candidates for election as a Class A
Director) and either (i) give one candidate all of the cumulated
votes, or (ii) distribute the cumulated votes among such
candidates as the holder sees fit.
Two proposals are scheduled for stockholder consideration at the
Annual Meeting, each of which is described more fully herein: (i)
the election of seven directors of the Company; and (ii) the
ratification of the action of the Board of Directors in appointing
PricewaterhouseCoopers LLP as the Company's independent
accountants for the fiscal year ending June 29, 2000. At the
meeting, the holders of Common Stock voting as a class will be
entitled to elect two of the seven directors, and the holders of
Class A Stock voting as a class will be entitled to elect the
remaining five directors. With respect to all matters other than
the election of directors or any matters for which class voting is
required by law, the holders of Common Stock and the holders of
Class A Stock will vote together as a single class and the holders
of Common Stock will be entitled to one vote per share of Common
Stock and the holders of Class A Stock will be entitled to ten
votes per share of Class A Stock.
Attendance at the meeting in person or by proxy by the holders of
Common Stock entitled to cast at least a majority of the votes
which the Common Stock is entitled to cast at the Annual Meeting
is required in order to establish a quorum for the purpose of
electing the directors to be elected by holders of the Common
Stock (the "Common Stock Directors"). Attendance at the Annual
Meeting in person or by proxy by the holders of Class A Stock
entitled to cast at least a majority of the votes which the
Class A Stock is entitled to cast at the Annual Meeting is
required in order to establish a quorum for the purpose of
electing the Class A Directors. Attendance at the meeting in
person or by proxy by the holders of Common Stock and Class A
Stock entitled to cast at least a majority of the votes which such
stock is entitled to cast at the Annual Meeting on matters other
than the election of directors is required in order to establish a
quorum for the purpose of any other business. Assuming the
presence of a quorum, (i) the affirmative vote of a majority of
the shares of Common Stock and Class A Stock, voting separately as
a class, present in person or by proxy at the Annual Meeting will
be required for the election of the Common Stock Directors and
Class A Directors, respectively, and (ii) the affirmative vote of
the holders of shares representing a majority of the votes
entitled to be cast by the holders of Common Stock and Class A
Stock, voting together as one class, present in person or by proxy
at the Annual Meeting and entitled to vote thereon shall be
required to act on all other matters to come before the Annual
Meeting.
Votes may be cast by a stockholder in favor of the nominees for
election as directors or withheld. Similarly, votes may be cast
by a stockholder in favor or against ratification of the
appointment of the independent accountants, or a stockholder may
elect to abstain from voting on these issues. Directions to
withhold authority, abstentions and broker non-votes (which occur
when a nominee holding shares for a beneficial owner does not vote
on a particular proposal because the nominee does not have
discretionary voting power with respect to that item and has not
received instructions from the beneficial owner) will be counted
in determining the presence or absence of a quorum for the
transaction of business at the Annual Meeting. Abstentions and
directions to withhold authority will have the effect of votes
against the proposal being considered. Broker non-votes, because
they are not deemed to be entitled to vote with respect to any
matter for which a broker does not have authority to vote, are not
counted in the vote totals and will have no effect on any proposal
scheduled for consideration at the Annual Meeting.
If a properly executed, unrevoked proxy does not specifically
direct the voting of the shares covered by such proxy, the proxy
will be voted (a) FOR the election of all nominees for election as
director to be elected by holders of the class of shares covered
by such proxy as listed herein, (b) FOR the ratification of the
appointment of PricewaterhouseCoopers LLP as the Company's
independent accountants for the fiscal year ending June 29, 2000,
and (c) in accordance with the judgment of the persons named in
the proxy as to such other matters as may properly come before the
Annual Meeting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
--------------------------------------------------------------
The following table sets forth information as of September 10,
1999 with respect to the beneficial ownership of Common Stock and
Class A Stock by (a) the persons known by the Company to be the
beneficial owners of more than 5% of the outstanding shares of
Common Stock or Class A Stock, (b) each director, and nominee for
director, of the Company, (c) each of the executive officers named
in the Summary Compensation Table below ("Named Executive
Officers") who currently serve as executive officers of the
Company, and (d) all directors, nominees for directors and
executive officers of the Company as a group. The information set
forth in the table as to directors, nominees for directors and
executive officers is based upon information furnished to the
Company by them in connection with the preparation of this Proxy
Statement. Except where otherwise indicated, the mailing address
of each of the stockholders named in the table is: c/o John B.
Sanfilippo & Son, Inc., 2299 Busse Road, Elk Grove Village,
Illinois 60007.
<TABLE>
<CAPTION>
% of
No. of Outstanding % of % of Outstanding
Shares Shares of No. of Shares Outstanding Votes on Matters
Of Common Common of Class Shares of Class Other than Election
Name Stock(1) Stock A Stock(1)(2) A Stock of Directors
- ---- --------- ----------- ------------- --------------- -------------------
<S> <C> <C> <C> <C>
Jasper B. Sanfilippo(3)+- 60,600 1.1% 1,523,776 41.3% 36.1%
Mathias A. Valentine(4)+- None -- 627,515 17.0 14.8
Marian Sanfilippo(5) 8,152 * 914,720 24.8 21.6
Michael J. Valentine(6)+- 14,402 * 621,415 16.9 14.7
Jeffrey T. Sanfilippo(7)+- 11,052 * None -- *
Gary P. Jensen(8)- 12,000 * None -- *
Steven G. Taylor(9)- 19,600 * None -- *
William D. Fischer(10)+ 17,750 * None -- *
J. William Petty(11)+ 3,500 * None -- *
John W. A. Buyers(12)+ 7,300 * None -- *
Timothy R. Donovan(13)x None -- None -- --
Governor James R. Edgar x None -- None -- --
Brinson Partners, Inc.(14) 750,900 13.7 None -- 1.8
Heartland Advisors, Inc.(15) 470,000 8.6 None -- 1.1
Dimensional Fund, Inc.(16) 416,000 7.6 None -- 1.0
All directors and executive
officers as a group (11
persons, all of whom are
stockholders)(3)(4)(6)(7)
(8)(9)(10)(11)(12)(17) 168,506 3.0 2,772,706 75.2 65.8
</TABLE>
+ Denotes Director.
- Denotes Named Executive Officer.
x Denotes nominee for election as a Director.
* Less than one percent.
(1) Except as otherwise indicated below, beneficial ownership
means the sole power to vote and dispose of shares. In
calculating each holder's percentage ownership and beneficial
ownership in the table above, shares of Common Stock which may
be acquired by the holder through the exercise of stock
options exercisable on or within 60 days of September 10, 1999
are included.
(2) Each share of Class A Stock is convertible at the option of
the holder thereof at any time and from time to time into one
share of Common Stock. In addition, the Restated Certificate
provides that Class A Stock may be transferred only to (a)
Jasper B. Sanfilippo or Mathias A. Valentine, (b) a spouse or
lineal descendant of Mr. Sanfilippo or Mr. Valentine, (c)
trusts for the benefit of any of the foregoing individuals,
(d) entities controlled by any of the foregoing individuals,
(e) the Company, or (f) any bank or other financial
institution as a bona fide pledge of shares of Class A Stock
by the owner thereof as collateral security for indebtedness
due to the pledgee (collectively, the "Permitted
Transferees"), and that upon any transfer of Class A Stock to
someone other than a Permitted Transferee each share
transferred will automatically be converted into one share of
Common Stock.
(3) Includes 163,045 shares of Class A Stock held as trustee of
certain trusts, the beneficiaries of which are the children of
Jasper and Marian Sanfilippo (two of whom - Jasper B.
Sanfilippo, Jr. and Jeffrey T. Sanfilippo are executive
officers of the Company and one of whom - Jeffrey T.
Sanfilippo is a director of the Company). Includes 5,000
shares of Common Stock held as a trustee of a certain trust,
the beneficiaries of which are the grandchildren of Jasper
and Marian Sanfilippo. Includes 24,600 shares of Common
Stock that Mr. and Mrs. Sanfilippo hold in joint tenancy.
Excludes shares held or voted by Jasper B. Sanfilippo's wife,
Marian Sanfilippo, of which Mr. Sanfilippo disclaims
beneficial ownership.
(4) Excludes 24 shares of Common Stock held by Mathias A.
Valentine's wife, Mary Valentine, of which Mr. Valentine
disclaims beneficial ownership.
(5) Includes 890,220 shares of Class A Stock held as trustee of
certain trusts, the beneficiaries of which are the children of
Jasper and Marian Sanfilippo (two of whom - Jasper B.
Sanfilippo, Jr. and Jeffrey T. Sanfilippo are executive
officers of the Company and one of whom - Jeffrey T.
Sanfilippo is a director of the Company). Excludes shares
held or voted by Marian Sanfilippo's husband, Jasper B.
Sanfilippo, of which Mrs. Sanfilippo disclaims beneficial
ownership. Excludes 24,600 shares of Common Stock that Mr. and
Mrs. Sanfilippo hold in joint tenancy.
(6) Includes (a) options to purchase 750 shares of Common Stock,
1,600 shares of Common Stock and 900 shares of Common Stock at
$6.60, $10.3125 and $6.875, respectively, per share which
are exercisable by Michael J. Valentine on or within 60 days
of September 10, 1999, (b) 621,415 shares of Class A Stock
held as trustee of certain trusts (collectively, the
"Valentine Trusts"), the beneficiaries of which are the
children of Mathias and Mary Valentine, including Michael J.
Valentine, and (c) 3,000 shares of Common Stock owned by a
general partnership, the general partners of which are the
Valentine Trusts.
(7) Includes options to purchase 600 shares of Common Stock, 1,400
shares of Common Stock and 900 shares of Common Stock at
$6.60, $10.3125 and $6.875, respectively, per share which are
exercisable by Jeffrey T. Sanfilippo on or within 60 days of
September 10, 1999. Excludes, 32,609 and 178,044 shares of
Class A Stock held as trustee by Jasper B. Sanfilippo and
Marian Sanfilippo, respectively. (Jasper B. Sanfilippo is
Chairman of the Board and Chief Executive Officer and a
director of the Company.)
(8) Includes options to purchase 3,000 shares of Common Stock,
2,600 shares of Common Stock and 1,400 shares of Common Stock
at $9.625, $9.375, and $6.25, respectively, per share which
are exercisable by Gary P. Jensen on or within 60 days of
September 10, 1999.
(9) Includes options to purchase 10,000 shares of Common Stock,
3,400 shares of Common Stock, 1,500 shares of Common Stock,
3,300 shares of Common Stock and 1,400 shares of Common Stock
at $15.00, $13.75, $6.00, $9.375 and $6.25, respectively, per
share which are exercisable by Steven G. Taylor on or within
60 days of September 10, 1999.
(10) Includes options to purchase 4,000 shares of Common Stock,
1,000 shares of Common Stock, 500 shares of Common Stock, 750
shares of Common Stock and 500 shares of Common Stock at
$12.25, $10.50, $6.00, $6.625 and $6.00, respectively, per
share which are exercisable by William D. Fischer on or within
60 days of September 10, 1999. Mr. Fischer's mailing address
is 680 North Lake Shore Drive, Chicago, IL 60611.
(11) Includes options to purchase 1,000 shares of Common Stock, 750
shares of Common Stock, 500 shares of Common Stock and 250
shares of Common Stock at $8.25, $6.625, $6.00 and
$4.25,respectively, per share which are exercisable by J.
William Petty on or within 60 days of September 10, 1999. Mr.
Petty's mailing address is 425 Ahwahnee Road, Lake Forest, IL
60045.
(12) Includes options to purchase 4,000 shares of Common Stock,
1,000 shares of Common Stock, 500 shares of Common Stock, 750
shares of Common Stock, 500 shares of Common Stock and 250
shares of Common Stock at $12.25, $10.50, $6.00, $6.625, $6.00
and $4.25, respectively, per share which are exercisable by
John W. A. Buyers on or within 60 days of September 10, 1999.
Mr. Buyers' mailing address is 26-238 Hawaii Belt Road, Hilo,
HI 96720.
(13) Excludes (a) 4,152 shares of Common Stock held by Mr.
Donovan's spouse, Elaine Karacic, (b) 18,102 shares of Common
Stock held by Elaine Karacic as trustee of certain trusts, the
beneficiaries of which are the children of Mr. Donovan and Ms.
Karacic, and (c) 146,732 shares of Common Stock held by Ms.
Karacic as trustee of certain trusts, the beneficiaries of
which are Ms. Karacic and her three siblings. Mr. Donovan
disclaims beneficial ownership of all of the foregoing shares
of Common Stock. Mr. Donovan's mailing address is c/o Tenneco
Automotive, Inc., 500 North Field Drive, Lake Forest, IL
60045.
(14) The information set forth in the table above and in this
footnote is based solely on (i) a Schedule 13G/A dated April
19, 1999 filed jointly by Brinson Partners, Inc. ("BPI") and
UBS AG and (ii) Forms 13F as of June 30, 1999 filed by BPI.
BPI is a wholly owned subsidiary of UBS AG. The principal
business office of BPI is located at 209 South LaSalle
Street, Chicago, IL 60604-1295. The principal business office
of UBS AG is located at Bahnhofstrasse 45 8021 Zurich,
Switzerland.
(15) The information set forth in the table above and in this
footnote is based solely on a Schedule 13G dated January 21,
1999 and a Form 13F as of June 30, 1999 filed by Heartland
Advisors Inc. The principal business office of Heartland
Advisors Inc. is 790 North Milwaukee Street, Milwaukee, WI
53202.
(16) The information set forth in the table above and in this
footnote is based solely on a Schedule 13G dated February 11,
1999 and a Form 13F as of June 30, 1999 filed by Dimensional
Fund Advisors Inc. The principal business office of
Dimensional Fund Advisors Inc. is 1299 Ocean Avenue, 11th
floor, Santa Monica, CA 90401.
(17) Includes options to purchase a total of 66,000 shares of
Common Stock (including the options referred to in footnotes
6, 7, 8, 9, 10, 11 and 12 above) at prices ranging from $4.25
to $15.00 per share which are exercisable by certain of the
directors and executive officers on or within 60 days of
September 10, 1999.
ELECTION OF DIRECTORS
---------------------
Seven directors are to be elected to serve until the next annual
meeting of stockholders and until their respective successors
shall be elected and qualified. Two of such directors are to be
elected by the holders of Common Stock voting as a class and the
remaining five directors are to be elected by the holders of
Class A Stock voting as a class. While the Board of Directors
does not contemplate that any nominee for election as a director
will not be able to serve, if any of the nominees for election
shall be unable or shall fail to serve as a director, the holders
of proxies shall vote such proxies for such other person or
persons as shall be determined by such holders in their discretion
or, so long as such action does not conflict with the provisions
of the Company's Restated Certificate relating to the proportion
of directors to be elected by the holders of Common Stock, the
Board of Directors may, in its discretion, reduce the number of
directors to be elected.
The Board of Directors recommends that the stockholders vote "FOR"
each of the nominees listed herein.
The affirmative vote of a majority of the shares of Common Stock
present at the Annual Meeting is required to elect the nominees
for election by the holders of Common Stock. The affirmative vote
of a majority of the total votes possessed by the shares of Class
A Stock present at the meeting, in accordance with the cumulative
voting rights possessed by holders of Class A Stock, is required
to elect the nominees for election by the holders of Class A
Stock. Messrs. Fischer and Petty, current members of the Board of
Directors, will not stand for re-election and will retire after
the Annual Meeting.
NOMINEES FOR ELECTION BY THE HOLDERS OF COMMON STOCK
----------------------------------------------------
The name of and certain information regarding each nominee for
election to the Company's Board of Directors by the holders of
Common Stock, as reported to the Company, is set forth below.
JOHN W. A. BUYERS, DIRECTOR, age 71 -- Mr. Buyers is currently
employed by C. Brewer and Company, Limited ("C. Brewer"), based in
Hilo, Hawaii, where he has served as Chief Executive Officer since
1975 and as Chairman of the Board since 1982. Mr. Buyers is also
currently the Chairman of the Board, President and Chief Executive
Officer of Buyco, Inc., the privately held parent company of
C. Brewer, and has served in those capacities since 1986.
C. Brewer is a diversified agribusiness, specialty foods company
and developer of commercial and agricultural real estate. It is
the world's leading producer of macadamia nuts (Mauna Loa) and
guava (KAI and Mauna La'i). In addition, C. Brewer specializes
in the roasting, processing, marketing and distribution of Kona
Coffee (Royal Kona and Mauna Kea) as well as the processing,
marketing and distribution of Hawaiian fruit jams, jellies and
syrups (Kukuir). C. Brewer also distributes products and services
for the agricultural, environmental and construction industries.
In addition, Mr. Buyers currently serves on the board of directors
of First Hawaiian Bank, First Hawaiian, Inc., Mauna Loa Macadamia
Partners, L.P., and C. Brewer Homes, Inc. Mr. Buyers has been a
member of the Company's Board of Directors since January 1992 and
is a member of the Company's Audit Committee and Compensation
Committee.
GOVERNOR JAMES R. EDGAR, age 53 -- Governor Edgar is currently a
Distinguished Fellow at the University of Illinois Institute of
Government and Public Affairs where he is also a teacher and
lecturer. He has been in this position since January 1999. He is
also a Resident Fellow at the John F. Kennedy School of Government
at Harvard University beginning in the 1999 fall semester. Gov.
Edgar served as governor of Illinois from January 14, 1991 through
January 11, 1999. Prior to his election, Gov. Edgar served as
Illinois Secretary of State from 1981 to 1991. Gov. Edgar's
retirement from public office marked 30 years of state government
service. Gov. Edgar serves on the board of directors of Kemper
Insurance Companies, the board of directors of Scudder Kemper
Funds and the board of directors of the Association of Governing
Boards of Universities and Colleges. He is also a member of the
board of directors of the National Center for Public Policy and
Higher Education.
NOMINEES FOR ELECTION BY THE HOLDERS OF CLASS A STOCK
-----------------------------------------------------
The name of and certain information regarding each nominee for
election to the Company's Board of Directors by the holders of
Class A Stock, as reported to the Company, is set forth below.
JASPER B. SANFILIPPO, CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE
OFFICER AND DIRECTOR, age 68 -- Mr. Sanfilippo has been employed by
the Company since 1953. Mr. Sanfilippo served as the Company's
President from 1982 to December 1995 and was the Company's
Treasurer from 1959 to October 1991. He became the Company's
Chairman of the Board and Chief Executive Officer in October 1991
and has been a member of the Company's Board of Directors since
1959. Mr. Sanfilippo is also a member of the Company's Compensation
Committee and was a member of the Stock Option Committee until
February 27, 1997 (when that Committee was disbanded). Since June
1992, Mr. Sanfilippo has been a member of the Board of Directors
and a Vice President of Sunshine Nut Co., Inc. ("Sunshine"), a
wholly owned subsidiary acquired by the Company in 1992.
Mr. Sanfilippo is the father of Jasper B. Sanfilippo, Jr., an
executive officer of the Company, and Jeffrey T. Sanfilippo, an
executive officer and director of the Company, the brother-in-law
of Mathias A. Valentine, the President and a director of the
Company and the uncle of Michael J. Valentine, a director and an
executive officer of the Company. Mr. Sanfilippo is also the uncle
by marriage of Timothy R. Donovan, a nominee to be a director of
the Company.
MATHIAS A. VALENTINE, PRESIDENT AND DIRECTOR, age 66 --
Mr. Valentine has been employed by the Company since 1960 and was
named its President in December 1995. He served as the Company's
Secretary from 1969 to December 1995, as its Executive Vice
President from 1987 to October 1991 and as its Senior Executive
Vice President and Treasurer from October 1991 to December 1995.
He has been a member of the Company's Board of Directors since
1969. Mr. Valentine is also a member of the Company's Compensation
Committee and was a member of the Stock Option Committee until
February 27, 1997 (when that Committee was disbanded). Mr.
Valentine has been a member of the Board of Directors and a Vice
President of Sunshine since June 1992. Mr. Valentine is the
brother-in-law of Jasper B. Sanfilippo, Chairman of the Board and
Chief Executive Officer and a director of the Company, the father
of Michael J. Valentine, a director and an executive officer of the
Company and the uncle of Jasper B. Sanfilippo, Jr., an executive
officer of the Company, and Jeffrey T. Sanfilippo, an executive
officer and director of the Company. Mr. Valentine is also the
uncle by marriage of Timothy R. Donovan, a nominee to be a director
of the Company.
MICHAEL J. VALENTINE, SENIOR VICE PRESIDENT AND SECRETARY, age 40 --
Mr. Valentine has been employed by the Company since 1987 and in
August 1999 was named Senior Vice President and Secretary. Mr.
Valentine was elected as a director of the Company in April 1997.
Mr. Valentine served as the Company's Vice President and Secretary
from December 1995 to August 1999. He served as Assistant
Secretary and the General Manager of External Operations for the
Company from June 1987 and 1990, respectively, to December 1995.
Mr. Valentine is the son of Mathias A. Valentine, the President and
a director of the Company, the nephew of Jasper B. Sanfilippo,
Chairman of the Board and Chief Executive Officer of the Company
and cousin of Jasper B. Sanfilippo, Jr., an executive officer of
the Company, and Jeffrey T. Sanfilippo, an executive officer and
director of the Company. Mr. Valentine is also a first cousin by
marriage of Timothy R. Donovan, a nominee to be a director of the
Company.
JEFFREY T. SANFILIPPO, SENIOR VICE PRESIDENT SALES AND MARKETING,
age 36 -- Mr. Sanfilippo has been employed by the Company since
1991 and was named its Senior Vice President Sales and Marketing in
August 1999. He served as General Manager West Coast Operations
from September 1991 to September 1993. He served as Vice President
West Coast Operations and Sales from October 1993 to September
1995. He served as Vice President Sales and Marketing from October
1995 to August 1999. Mr. Sanfilippo is the son of Jasper B.
Sanfilippo, the Chairman of the Board and Chief Executive Officer
and a director of the Company, the nephew of Mathias A. Valentine,
the President and a director of the Company, the brother of Jasper
B. Sanfilippo, Jr., an executive officer of the Company and the
cousin of Michael J. Valentine, an executive officer and director
of the Company. Mr. Sanfilippo is also a first cousin by marriage
of Timothy R. Donovan, a nominee to be a director of the Company.
TIMOTHY R. DONOVAN, age 43 -- Mr. Donovan is currently a partner in
the law firm of Jenner & Block, where he has served as the Chairman
of the Corporate and Securities Department since 1998 and as a
member of the firm's Executive Committee since 1997. Mr. Donovan
joined Jenner & Block in 1982 after serving as a staff trial
attorney at the Chicago District Counsel's Office of the Internal
Revenue Service. On August 1, 1999, Mr. Donovan was appointed
Senior Vice President and General Counsel of Tenneco Automotive
Inc., one of the world's largest producers of emissions control and
ride control systems and products for the automotive industry. As
a result of this appointment, Mr. Donovan will resign from Jenner &
Block at the end of this calendar year. Mr. Donovan is the nephew
by marriage of Messrs. Jasper B. Sanfilippo and Mathias A.
Valentine, who are directors and executive officers of the Company,
and the first cousin by marriage of Jasper B. Sanfilippo, Jr.,
Jeffrey T. Sanfilippo and Michael J. Valentine, each of whom is an
executive officer and certain of whom are also directors of the
Company.
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
-------------------------------------------------
The Board of Directors of the Company met four times during fiscal
1999. During fiscal 1999, all directors attended at least 75% of
the meetings of the Board of Directors and the committees thereof
on which they served. Standing committees of the Board of
Directors include the Audit Committee and the Compensation
Committee. The Board does not have a nominating committee, and the
usual functions of such a committee are performed by the entire
Board.
The Audit Committee reviews and, as it deems appropriate, approves
internal accounting and financial controls for the Company and
accounting principles and auditing practices and procedures to be
employed in the preparation and review of financial statements of
the Company. The Audit Committee also makes recommendations to the
Board concerning the engagement of independent public accountants
to audit the annual consolidated financial statements of the
Company and arranges with such accountants the scope of the audit
to be undertaken by them. Further, the Audit Committee also reviews
related party transactions in accordance with the rules promulgated
by the National Association of Securities Dealers, Inc. The current
members of the Audit Committee are John W. A. Buyers, William D.
Fischer and J. William Petty. The Audit Committee held two
meetings during fiscal 1999.
The Compensation Committee reviews and makes recommendations to the
Board with respect to the salaries, bonuses and other compensation
of officers and other executives, including matters relating to
stock options, which are determined by the entire Board of
Directors. The Compensation Committee consists of Jasper B.
Sanfilippo, William D. Fischer, John W. A. Buyers and Mathias A.
Valentine. The Compensation Committee held two meetings during
fiscal 1999.
COMPENSATION OF DIRECTORS
- -------------------------
Compensation to directors who are not employees of the Company is
paid at the rate of $16,000 per year plus $1,000 for each Board
meeting attended, $350 for each telephonic meeting of the Board in
which they participate, $500 for each committee meeting attended
and $350 for each telephonic committee meeting in which they
participate. Directors are also reimbursed for their expenses
incurred in attending such meetings. Directors who are employees
of the Company receive no additional compensation for their
services as directors.
Under the 1998 Equity Incentive Plan, a director who is not an
employee of the Company, its subsidiaries, or any of their
affiliates (an "Outside Director") is automatically granted an
option to purchase 1,000 shares of Common Stock on the date of his
or her election to the Company's Board, and on each date of his or
her re-election to the Board. Options granted to Outside Directors
under the 1998 Equity Incentive Plan are granted at an exercise
price equal to the Fair Market Value (as defined in the 1998 Equity
Incentive Plan) of a share of Common Stock on the date of grant.
Options granted to Outside Directors will become exercisable in
equal increments of 250 shares of Common Stock on the first four
anniversaries of the date of grant and expire 10 years following
the date of grant. Pursuant to the 1998 Equity Incentive Plan, on
October 28, 1999, Messrs. Buyers, Fischer and Petty each were
granted an option to purchase up to 1,000 shares of Common Stock at
an exercise price of $4.25 per share. On January 27, 1999, the
Board honored the request of Mr. Fischer and cancelled the option
for 1,000 shares that was awarded to him on October 28, 1999 due to
his desire not to stand for re-election at the fiscal 1999 Annual
Stockholders meeting.
EXECUTIVE COMPENSATION
----------------------
The following table sets forth a summary of compensation for
services in all capacities to the Company during the fiscal year
ended June 24, 1999, the fiscal year ended June 25, 1998, the
twenty-six weeks ended June 26,1997 (the "Transition Period",
effective April 30, 1997 the Company changed its fiscal year from a
year ending on December 31 to a year ending on the last Thursday of
June each year) and the fiscal year ended December 31, 1996 paid
to or accrued for (i) the Company's Chief Executive Officer, and
(ii) each of the four additional most highly compensated executive
officers of the Company, and (iii) former executive officer of the
Company, (collectively the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
--------------------------
<TABLE>
<CAPTION>
Long Term
Compensation
Annual Compensation Awards
-------------------------------- -------------
Securities
Name and Underlying All Other
Principal Position Year Salary Bonus Other(1) Options(#) Compensation
- -------------------- ---- -------- ------- -------- ---------- --------------
<S> <C> <C> <C> <C> <C> <C>
Jasper B. Sanfilippo 1999 $410,000 $ 0 $4,270 -- $139,138(2)(3)
Chairman of the 1998 403,077 45,995 6,231 -- 141,185
Board and Chief 1997+ 184,615 18,000 -- -- 63,972
Executive Officer 1996 395,877 0 -- -- 129,960
Mathias A. Valentine 1999 $250,000 $ 0 $2,441 -- $77,699(3)(4)
President 1998 243,077 27,755 2,082 -- 76,271
1997+ 110,769 10,800 -- -- 27,904
1996 236,539 0 -- -- 64,678
Steven G. Taylor(5) 1999 $194,807 $ 0 $237 5,000 $40,856(6)
Executive Vice 1998 178,153 18,920 366 -- 2,193
President 1997+ 87,500 7,350 -- 2,800 1,214
1996 172,424 0 -- -- 1,065
John C. Taylor(5)(7) 1999 $135,327 $ 0 $199 -- $54,337(8)
Executive Group 1998 178,153 18,920 606 -- 5,094
Vice President 1997+ 87,500 7,350 -- 2,800 4,116
1996 172,424 0 -- -- 6,486
Gary P. Jensen 1999 $155,315 $ 0 $389 5,000 $999(9)
Executive Vice 1998 143,446 15,280 498 -- 846
President Finance and 1997+ 64,615 5,880 -- 2,800 300
Chief Financial Officer 1996 138,408 0 -- -- 300
Michael J. Valentine 1999 $114,115 $ 0 -- -- $400(10)
Senior Vice President 1998 103,461 10,077 -- -- 300
and Secretary 1997+ 49,489 3,811 -- 1,800 300
1996 97,413 0 -- -- 300
</TABLE>
+ Compensation for the Transition Period 1997, which
consists of the twenty-six weeks ended June 26, 1997.
(1) None of the Named Executive Officers received
perquisites in excess of the lesser of $50,000 or 10% of
the aggregate of such officer's salary and bonus. The
Other Annual Compensation reflected is the Company's
reimbursement to the named executives for the tax
liability incurred by the named executives for a life
insurance benefit as described in the subsequent
footnotes. The named executives are the only employees who
participate in this benefit.
(2) Includes $116,503 of premiums paid by the Company
under a split-dollar agreement with Mr. Sanfilippo
covering certain joint and survivor life insurance
policies issued on the joint lives of Jasper B. Sanfilippo
and his spouse. Also includes $14,492 of life insurance
premiums. During fiscal 1999, the Company paid $8,143 for
the term portions of the split-dollar life insurance
premiums of Mr. Sanfilippo.
(3) The split-dollar agreements require that the Company
be reimbursed for all premiums paid upon either the
surrender of the policies or the death of both insureds.
The reimbursement obligation is secured by a collateral
assignment to the Company of certain rights in the
policies. The Company is required to pay the monthly
premiums; provided, however, each of Messrs. Sanfilippo
and Valentine may elect in any year to pay that portion of
the monthly premiums which would otherwise be treated as
taxable compensation to him under the Internal Revenue
Code of 1986, as amended (the "Code"). The Company
reflects the total amount of premiums it pays under the
split-dollar agreements as an asset on its financial
statements.
(4) Includes $40,008 of premiums paid by the Company under
a split-dollar agreement with Mr. Valentine covering
certain joint and survivor life insurance policies issued
on the joint lives of Mathias A. Valentine and his spouse.
Also includes $31,380 of life insurance premiums and $400
of matching contributions to the 401(k) Plan described
below. During 1999, the Company paid $5,911 for the term
portions of the split-dollar life insurance premiums of
Mr. Valentine.
(5) The salary and bonus amounts set forth for Mr. Steven
G. Taylor and Mr. John C. Taylor, executive officers of
the Company and, for the periods presented above,
executive officers and employees of Sunshine were paid by
Sunshine.
(6) Includes $38,541 of relocation expenses, $400 of
matching contributions to the 401(k) Plan described below,
$733 of life insurance premiums and $1,182 of disability
insurance premiums paid by the Company for fiscal 1999.
(7) Effective April 12, 1999, John C. Taylor resigned as
an executive officer of the Company and Sunshine.
(8) Includes $50,000 pertaining to a severance agreement,
$3,937 of disability insurance premiums and $400 of
matching contributions to the 401(k) Plan described below.
(9) Includes $400 of matching contributions to the 401(k)
Plan described below and $599 of life insurance premiums
paid by the Company for fiscal 1999.
(10) Includes $400 of matching contributions to the 401(k)
Plan described below.
INCENTIVE BONUS PROGRAM
- -----------------------
During the Transition Period, the Compensation Committee
established an Incentive Bonus Program (the "Incentive Bonus
Program") to provide qualifying employees, including
executive officers, with cash bonuses. Under the Incentive
Bonus Program, cash bonuses are awarded based on the
Company's earnings per share and vary according to each
qualifying employee's job category. The Company did not
accrue or pay bonuses in fiscal 1999 in accordance with the
Incentive Bonus Program. Under the Incentive Bonus Program
the Company paid aggregate bonuses for fiscal 1998 of
$442,139 in September 1998. The Company awarded aggregate
bonuses of $177,082 under the Incentive Bonus Program for the
Transition Period, which were paid in March 1998. The Company
did not have an incentive bonus program in 1996 and did not
pay any bonuses in 1996.
401(k) PLAN
- -----------
The Company maintains a plan (the "401(k) Plan") which is
intended to qualify under sections 401(a) and 401(k) of the
Code. The 401(k) Plan was adopted in January 1986 and
amended in August 1992, January 1993, January 1994 and
January 1996. All non-union employees of the Company who
have attained age 21 and completed at least one year of
service with the Company are eligible to participate in the
401(k) Plan. The 401(k) Plan permits each participant to
make contributions on a pretax basis subject to limitations
established by the trustees who administer the 401(k) Plan.
The amount of participant contributions to the 401(k) Plan
may also be limited by Code requirements. Effective January
1, 1994, the Company contributes 50% of the amount each
employee contributes to the 401(k) Plan up to a maximum
matching contribution of $300 per employee. Effective January
1, 1999 the Company's matching contribution was increased to
a maximum of $400 per employee. The Company may also make
discretionary contributions to the 401(k) Plan, which are
allocated among participants pro rata based on compensation.
The pretax contributions made by participants and the
matching contributions made by the Company, and earnings
thereon, are at all times fully vested. A participant's
interest in discretionary contributions made by the Company
and earnings thereon vest over a six year period and becomes
fully vested upon the earliest to occur of such participant's
attainment of age 65, death, disability or completion of six
years of service. Benefits under the 401(k) Plan may be
distributed to participants upon their termination of
employment. In addition, the 401(k) Plan permits employees
who have attained age 59 1/2 years and who have completed 10
years of service to withdraw all or a portion of their 401(k)
Plan account balances under certain circumstances. In fiscal
1999, the Company made matching contributions to the 401(k)
Plan of $400 on behalf of each of Messrs. Mathias Valentine,
Jensen, Steven G. Taylor, John C. Taylor and Michael J.
Valentine, and $2,800 for all executive officers as a group.
The Chief Executive Officer did not make any elective
contributions to the 401(k) Plan in fiscal 1999 and,
consequently, did not receive any matching contributions.
The Company did not make any discretionary contributions to
the 401(k) Plan for fiscal 1999, fiscal 1998, the Transition
Period or fiscal 1996.
1991 Stock Option Plan
- ----------------------
The Company's 1991 Stock Option Plan (the "1991 Plan") was
adopted in 1991 and terminated by the Board of Directors as
of February 28, 1995. The termination of the 1991 Plan does
not, however, affect options granted under the 1991 Plan
which remain outstanding. The 1991 Plan was administered by
the Stock Option Committee, which was comprised of Jasper B.
Sanfilippo and Mathias A. Valentine. Messrs. Sanfilippo and
Valentine were not eligible to participate in the 1991 Plan.
Effective February 27, 1997, the Stock Option Committee was
eliminated and administration of the 1991 Plan was assumed by
the Board of Directors. An aggregate of 350,000 shares of
Common Stock were available for awards under the 1991 Plan,
subject to adjustments reflecting changes in the Company's
capitalization. Options granted under the 1991 Plan were
either incentive stock options or such other forms of
nonqualified stock options as the Stock Option Committee
determined. Incentive stock options granted under the 1991
Plan were intended to qualify as "incentive stock options"
within the meaning of Section 422 of the Code. The exercise
price of such options was determined by the Stock Option
Committee except that the exercise price of (a) an incentive
stock option granted to an individual who owned (directly or
by attribution under Section 424(d) of the Code) shares
possessing more than 10% of the total combined voting power
of all classes of stock of the Company (a "10% Owner") had to
be at least 110% of the fair market value (as defined in the
1991 Plan) of a share of Common Stock on the date the
incentive stock option was granted; (b) an incentive stock
option granted to an individual other than a 10% Owner had to
be at least 100% of the fair market value of a share of
Common Stock on the date the incentive stock option was
granted; and (c) a nonqualified stock option had to be at
least 33% of the fair market value of a share of Common Stock
on the date the nonqualified stock option was granted.
Subject to certain exceptions, an individual's options expire
if the individual's employment with or service as a director
of the Company, as the case may be, terminates. As of
February 28, 1995, the date the 1991 Plan was terminated, the
Company had granted options to purchase a total of 373,000
shares of Common Stock pursuant to the 1991 Plan (although no
more than 350,000 shares of Common Stock were, at any given
time, subject to options granted under the 1991 Plan). Of
these options, 175,401 had been canceled and 2,649 had been
exercised as of September 10, 1999 and 194,950 were
exercisable on or within 60 days of September 10, 1999.
1995 Equity Incentive Plan
- --------------------------
The Company's 1995 Equity Incentive Plan (the "1995 Plan")
was adopted in 1995 and terminated by the Board of Directors
as of August 27, 1998. The termination of the 1995 Plan does
not, however, affect options granted under the 1995 Plan
which remain outstanding. The purpose of the 1995 Plan was
to encourage and facilitate the acquisition of Common Stock
by those key employees and Outside Directors upon whose
judgment and interest the growth, development and financial
success of the Company is dependent. Subject to antidilution
and similar provisions, an aggregate of 200,000 shares of
Common Stock could be issued upon the exercise of stock
options granted under the 1995 Plan. As of the date the 1995
Plan was terminated, the Company had granted options to
purchase a total of 201,400 shares of Common Stock under the
1995 Plan (although no more than 200,000 shares of Common
Stock were, at any time, subject to options granted under
the 1995 Plan). Of these options, 51,900 had been canceled
as of September 10, 1999, and 93,700 were exercisable on or
within 60 days of September 10, 1999 ( the balance of such
options becoming exercisable in various increments over the
next two years).
Pursuant to the 1995 Plan, the Board of Directors could
select key employees of the Company to receive awards of
stock options, which could be either nonqualified stock
options or "incentive stock options" within the meaning of
Section 422 of the Code, in consideration for their services.
In addition under the 1995 Plan each Outside Director was
granted a nonqualified option to purchase up to 1,000 shares
of Common Stock (i) on the date of his or her initial
election to the Board of Directors, and (ii) on the date of
each subsequent re-election to the Board.
Generally, stock options granted under the 1995 Plan become
exercisable in equal installments of 25% of the shares
covered by the option on the first four anniversaries of the
date of grant subject to, in the case of an employee,
continued employment with the Company or its subsidiaries, or
in the case of an Outside Director, continued service as a
director, on such date. However, all options granted under
the 1995 Plan become fully vested and exercisable on the
first date on which no shares of Class A Stock are
outstanding. The exercise price of options granted to
employees under the 1995 Plan was determined by the Board of
Directors; provided, however, that (i) the exercise price
for nonqualified stock options granted to employees was
required to be not less than 50% of the fair market value of
a share of Common Stock on the date of grant, and (ii) the
exercise price for incentive stock options was required to be
not less than 100% of the fair market value of a share of
Common Stock on the date of the grant (110% in the case of
incentive stock options granted to a 10% Owner). The
exercise price for each option granted to an Outside Director
under the 1995 Plan was required to equal 100% of the fair
market value for a share of Common Stock on the date such
option was granted. Options granted under the 1995 Plan may
not be assigned or transferred other than by will or the laws
of descent and distribution and may be exercised during the
grantee's lifetime only by the grantee. No option granted
under the 1995 Plan may be exercised after the expiration of
ten years after the date of the grant (five years in the case
of incentive stock options granted to a 10% Owner).
Unexercised options terminate upon or within one year of an
employee's termination of employment with the Company.
1998 Equity Incentive Plan
- --------------------------
The Company's 1998 Equity Incentive Plan (the "1998 Plan")
was adopted in 1998 at the Annual Stockholders Meeting. The
purpose of the 1998 Plan is to increase ownership of Common
Stock of the Company by those key employees (including
officers and certain directors who are also officers) and
Outside Directors who contribute to the continued growth,
development and financial success of the Company and its
subsidiaries, and to attract and retain key employees and
reward them for the Company's profitable performance. As of
September 10, 1999, the Company had granted options to
purchase a total 49,500 shares of Common Stock under the 1998
Plan. Of these options, 500 were exercisable on or within 60
days of September 10, 1999 ( the balance of such options
becoming exercisable in various increments over the next four
years).
Pursuant to the 1998 Plan, the Board of Directors can select
key employees of the Company to receive awards of stock
options, which can be either nonqualified stock options or
"incentive stock options" within the meaning of Section 422
of the Code, in consideration for their services. Under the
1998 Plan each Outside Director is granted a nonqualified
option to purchase up to 1,000 shares of Common Stock (i) on
the date of his or her initial election to the Board of
Directors, and (ii) on the date of each subsequent re-
election to the Board.
Generally, stock options granted under the 1998 Plan become
exercisable in equal installments of 25% of the shares
covered by the option on the first four anniversaries of the
date of grant subject to, in the case of an employee,
continued employment with the Company or its subsidiaries, or
in the case of an Outside Director, continued service as a
director, on such date. However, all options granted under
the 1998 Plan become fully vested and exercisable on the
first date on which no shares of Class A Stock are
outstanding. The exercise price of options granted to
employees under the 1998 Plan is determined by the Board of
Directors; provided, however, that (i) the exercise price for
nonqualified stock options granted to employees was required
to be not less than 50% of the fair market value of a share
of Common Stock on the date of grant, and (ii) the exercise
price for incentive stock options was required to be not less
than 100% of the fair market value of a share of Common Stock
on the date of the grant (110% in the case of incentive stock
options granted to a 10% Owner). The exercise price for each
option granted to an Outside Director under the 1998 Plan is
required to equal 100% of the fair market value for a share
of Common Stock on the date such option was granted. Options
granted under the 1998 Plan may not be assigned or
transferred other than by will or the laws of descent and
distribution and may be exercised during the grantee's
lifetime only by the grantee. No option granted under the
1998 Plan may be exercised after the expiration of ten years
after the date of the grant (five years in the case of
incentive stock options granted to a 10% Owner). Unexercised
options terminate upon or within one year of an employee's
termination of employment with the Company.
OPTION GRANT TABLE
- ------------------
The following table sets forth certain information concerning
the grant of stock options made to each of the Named
Executive Officers during 1999.
OPTION GRANTS IN LAST FISCAL YEAR
---------------------------------
<TABLE>
<CAPTION>
Individual Grants
------------------------------------------------------
Potential Realizable Value
At Assumed Annual Rates
% of Total of Stock Price Appreciation
Options Granted Exercise for Option Term(2)
Options to Employees in Price Expiration ----------------------------
Name Granted(#)(1) Fiscal Year ($/Share) Date 5%($) 10%($)
- -------------------- ------------- --------------- --------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Jasper B. Sanfilippo -- -- -- -- -- --
Mathias A. Valentine -- -- -- -- -- --
Steven G. Taylor 5,000 10.1% $4.00 2/2/2009 $12,578 $31,875
John C. Taylor(3) -- -- -- -- -- --
Gary P. Jensen 5,000 10.1% $4.00 2/2/2009 $12,578 $31,875
Michael J. Valentine -- -- -- -- -- --
</TABLE>
(1) The stock options reflected above expire if the
individual's employment with the Company terminates. The stock
options set forth above are exercisable with respect to the
Common Stock underlying such options 25% annually commencing on
the first anniversary of the date of the grant and become fully
exercisable on the fourth anniversary of the date of the grant.
(2) Amounts represent hypothetical gains or "option spreads"
that could be achieved for the respective options based on
assumed annual compound stock appreciation rates of 5% and 10%
over the original full ten-year term of these options. The 5%
and 10% rates of stock appreciation are mandated by rules of
the Securities and Exchange Commission and do not represent the
Company's estimate of the future market price of the Common
Stock.
(3) John C. Taylor resigned effective April 12, 1999 and
therefore stock options granted of 2,500 shares were terminated
on April 13,1999 in accordance with the provisions of the 1998
Plan.
OPTION EXERCISES AND HOLDINGS
- -----------------------------
The following table sets forth the certain information
regarding option exercises during fiscal 1999 by each of the
Named Executive Officers and the number and value of
securities underlying options held by each of the Named
Executive Officers at June 24, 1999.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
-----------------------------------------------
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised In the Money
Shares Acquired Value Options at Fiscal-Year End (#) Options at Fiscal-Year End($)
Name on Exercise(#) Realized($) Exercisable/Unexercisable Exercisable/Unexercisable
- -------------------- --------------- ----------- ------------------------------ ---------------------------------
<S> <C> <C> <C> <C>
Jasper B. Sanfilippo -- -- -- --
Mathias A. Valentine -- -- -- --
Steven G. Taylor -- -- 18,775/7,225 --(1)
John C. Taylor -- -- 18,075/0(2) --(1)
Gary P. Jensen -- -- 6,350/7,050 --(1)
Michael J. Valentine -- -- 2,850/1,300 --(1)
</TABLE>
(1) The exercise price for each of the exercisable options
which remained unexercised as of June 24, 1999 exceeded the
fair market value of the Common Stock underlying such
options at June 24, 1999.
(2) Resigned as an executive officer of the Company effective
April 12, 1999. In accordance with 1991 Plan, 1995 Plan
and 1998 Plan, non-vested stock options terminated April
13, 1999. Also, exercisable stock options terminated
effective July 12, 1999.
EMPLOYMENT CONTRACT
- -------------------
Sunshine was a party to an Employment Agreement with Steven G.
Taylor, dated June 17, 1992, pursuant to which Steven G.
Taylor was to be employed as and serve as a Vice President of
Sunshine until June 17, 2000. Steven G. Taylor's annual base
compensation under his Employment Agreement was $150,000,
subject to increase from time to time in the sole discretion
of the Board of Directors of Sunshine but generally in
accordance with Sunshine's customary practices for increases
in base salaries. Under his Employment Agreement, Steven G.
Taylor was entitled to participate in employment plans and
benefits provided by Sunshine to executive officers of
Sunshine and was also entitled to receive pay increases,
bonuses and stock options comparable to those available
annually to upper level management employees of the Company.
In accordance with the terms of the Employment Agreement, the
Board of Directors of Sunshine fixed the fiscal 1999 salary
for Steven G. Taylor at $194,807. On June 25, 1999 the
Company dissolved Sunshine and merged it with the Company.
The Company guaranteed the performance of Sunshine under the
Employment Agreement and is now directly responsible for Mr.
Taylor's salary. The Company anticipates entering into a
new Employment Agreement with Mr. Taylor.
The Report of the Compensation Committee on Executive
Compensation and the Performance Graph below shall not be
deemed incorporated by reference by any general statement
incorporating by reference this Proxy Statement or any portion
hereof into any filing under the Securities Act of 1933, as
amended, or the Securities Exchange Act of 1934, as amended,
and shall not otherwise be deemed filed under such Acts.
JOINT REPORT OF THE BOARD OF DIRECTORS AND THE COMPENSATION
COMMITTEE ON EXECUTIVE COMPENSATION
-----------------------------------------------------------
EXECUTIVE COMPENSATION PRINCIPLES
- ---------------------------------
The Company's Executive Compensation Program is based on
principles designed to align executive compensation with
Company objectives, management initiatives and business
financial performance. These principles are applied by the
Board of Directors and Compensation Committee (and, in the
case of Steven G. Taylor, subject to the terms of his
Employment Agreement, see "Executive Compensation -
Employment Contract") to:
- -- Attract and retain key executives critical to the success
of the Company and its subsidiaries.
- -- Reward executives for long-term strategic management and
the enhancement of stockholder value.
- -- Support a performance-oriented environment that rewards
performance based on Company goals.
OVERVIEW OF EXECUTIVE COMPENSATION PROGRAM
- ------------------------------------------
The Company's total compensation program for its executive
officers consists of both cash and, except with respect to the
Chief Executive Officer and the President, equity based
compensation. Each executive officer's annual compensation
consists of a base salary, eligibility for matching and
discretionary contributions to the 401(k) Plan and eligibility
for an annual bonus under the Incentive Bonus Program. In
addition, the Company provides life (including split-dollar
life insurance) and disability insurance for certain executive
officers. The Compensation Committee determines the level of
base salary for key executive officers, including the Chief
Executive Officer, and a base salary range for other executive
officers. The Compensation Committee generally determines
such salary or salary range based on a number of factors and
criteria, including the salaries paid by the Company to its
executive officers during the immediately preceding year, the
rate of inflation, the Company's performance during the
immediately preceding fiscal year, the performance of the
executive officer during the immediately preceding fiscal year
and the salaries paid to the executive officers of certain
other companies engaged in the food or agricultural commodity
business with annual sales of less than $1.0 billion (the
"Compensation Comparison Group"). The weight and importance
given each year to the foregoing factors, the individual
components of each factor and the decision whether to consider
additional factors, lies within the subjective discretion of
the Compensation Committee. Because the compensation levels
of the Company's executive officers are significantly below
compensation levels that would be affected by the limitations
on the deduction of executive salaries imposed by Section
162(m) of the Code ("Section 162(m)"), the Compensation
Committee has not formulated a policy with respect to Section
162(m). The 1998 Plan provides for certain limits, consistent
with Code Section 162 and the regulations promulgated
thereunder, on the maximum number of shares of Common Stock
subject to options that may be granted to any grantee in any
one calendar year.
FISCAL 1999 EXECUTIVE COMPENSATION
- ----------------------------------
In April 1997, the Company changed its fiscal year from a
calendar year to a fiscal year ending on the final Thursday of
June each year. In order to transition from a calendar year
to a June fiscal year, the Company reported financial results
for the twenty-six week period ended June 26, 1997. The
Company's fiscal 1998 year thus consisted of the fifty-two
week period ended June 25, 1998. The Company's fiscal 1999
year consisted of the fifty-two week period ended June 24,
1999.
Despite the change in the Company's fiscal year, the base
salaries and salary ranges for the Company's executive
officers have continued to be determined at the first meetings
of the Compensation Committee and Board of Directors of the
calendar year. Accordingly, fiscal 1999 base salaries and
salary ranges include one-half year of amounts set as of the
beginning of calendar 1999.
The Compensation Committee primarily based calendar 1997, 1998
and 1999 salaries and salary ranges of the Company's executive
officers, including the Chief Executive Officer, on the
salaries paid to such executive officers in 1996, 1997 and
1998, respectively. For calendar 1997, 1998 and 1999, such
base salaries and salary ranges were generally increased by a
percentage slightly greater than the percentage change in the
Consumer Price Index in 1996, 1997 and 1998, respectively. The
Compensation Committee determined, in general, not to increase
additionally such salaries and salary ranges, including the
salary of the Chief Executive Officer, as a result of the
Company's performance in 1996 and the Transition Period.
The Compensation Committee did not use the salaries of
executive officers of the Compensation Comparison Group to
establish base salaries and salary ranges for the Company's
executive officers, including the Chief Executive Officer, but
did compare its determination of such salaries and salary
ranges against the base salaries reported for executive
officers of the Compensation Comparison Group as an
independent measure of reasonableness. The calendar 1997,
1998 and 1999 base salaries for the Company's executive
officers set by the Compensation Committee were, in general,
at the low to medium ranges when compared to the base salaries
of the Compensation Comparison Group executives. However, the
Compensation Committee does not currently have an established
policy with regard to the salaries and salary ranges of the
Company's executive officers, including the salary of the
Chief Executive Officer, relative to the salaries paid to the
Compensation Comparison Group executive officers.
The Company awards annual bonuses to executive officers of the
Company pursuant to the Incentive Bonus Program. Under the
Incentive Bonus Program, each executive officer receives a set
percentage of his salary as a bonus if the Company's earnings
per share for the prior fiscal year meet or exceed specified
levels, which percentage increases as the Company's earnings
per share increase. The Board of Directors, when it adopted
the Incentive Bonus Program, set the earnings per share
targets and salary percentages for executive officers based on
the subjective judgment of the directors, as well as
management's recommendations regarding a number of factors
such as position held and annual performance. The Company
paid bonuses of $61,421 and $161,949, in the aggregate, to the
Company's executive officers for the Transition Period and
fiscal 1998, respectively, pursuant to the Incentive Bonus
Program. In fiscal 1999 bonuses were not earned under the
Incentive Bonus Program.
The Company provides long-term incentives to its executive
officers through its stock option plans. Through the award of
stock option grants, the objective of aligning executive
officers' long-range interests with those of the stockholders
are met by providing the executive officers with the
opportunity to build a meaningful stake in the Company. The
Stock Option Committee reviewed and approved the participation
of employees of the Company and its subsidiaries under the
1991 Plan (which was terminated in February 1995) and the 1995
Plan through February 27, 1997, at which time the Stock Option
Committee was eliminated and its duties and responsibilities
under both plans were assumed by the full Board. The Board did
not award any stock options to executive officers during
fiscal 1998. In accordance with the 1995 Plan, options were
issued during the Transition Period by the Board of Directors
to certain Company employees, including certain executive
officers. The Board of Directors did not assign any measurable
weighting to any of the factors it considered in approving
these grants of stock options. However, the Board of
Directors did consider and approve the amounts and terms of
prior option awards in determining the recipients of options
grants during the Transition Period. The 1995 Plan was
terminated effective August 27, 1998. In fiscal 1999, the
Board awarded stock options under the 1998 Plan to certain of
its executive officers (other than Jasper B. Sanfilippo and
Mathias A. Valentine, who are not eligible to participate in
the 1998 Plan). See "Option Grant Table".
Executive officers are eligible to participate in the
Company's 401(k) Plan, including Company matching and
discretionary contributions to the 401(k) Plan. The Company
made no discretionary contributions to the 401(k) Plan for
fiscal 1999, fiscal 1998 or the Transition Period; however,
the executive officers as a whole had $2,800, $2,100 and
$2,100 contributed as matching funds under the 401(k) Plan for
fiscal 1999, fiscal 1998 and the Transition Period,
respectively. The Company provides certain executive officers
with life and disability insurance. The Company also
maintains split-dollar life insurance policies on the joint
lives of Jasper B. Sanfilippo and his spouse and Mathias A.
Valentine and his spouse, and on the life of John C. Taylor.
See "Executive Compensation - Summary Compensation Table".
The Compensation Committee and the Board of Directors believe
that their respective grants of compensation awards will
produce significant long-term compensation for periods when
the Company's performance objectives are met.
FISCAL 1999 CHIEF EXECUTIVE OFFICER COMPENSATION
- ------------------------------------------------
The Chief Executive Officer's fiscal 1999 base salary
increased to $410,000 which was a percentage increase from his
base salary for the comparable fifty-two week period in 1998
that was slightly less than the rate of inflation between
these comparative periods. The Compensation Committee based
this increase in the Chief Executive Officer's base salary on
the factors and criteria discussed above with regard to the
establishment of calendar 1997, 1998 and 1999 base salaries
and salary ranges for the Company's executive officers. The
Chief Executive Officer's fiscal 1999 base salary was at the
medium range of the base salaries of chief executive officers
of the companies in the Compensation Comparison Group.
William D. Fischer and John W. A. Buyers, as the only non-
employee directors on the Compensation Committee during fiscal
1999, were assisted in establishing the increase in the Chief
Executive Officer's base salary for fiscal 1999 by their broad
knowledge of executive pay practices in the food industry and
the importance to the Company of the services provided by the
Chief Executive Officer. The Chief Executive Officer was
awarded a bonus of $18,000 and $45,995 for the Transition
Period and fiscal 1998, respectively, pursuant to the formula
established for him under the Incentive Bonus Program as
described above. In fiscal 1999 the Chief Executive Officer
did not receive a bonus. The Chief Executive Officer did not
participate in the 1991 Plan or the 1995 Plan and is not
eligible to participate in the 1998 Plan. In fiscal 1999,
the Company also provided the Chief Executive Officer with
life insurance and split-dollar life insurance as discussed
above.
Compensation Committee Board of Directors
---------------------- ------------------
Jasper B. Sanfilippo Jasper B. Sanfilippo
Mathias A. Valentine Mathias A. Valentine
William D. Fischer Michael J. Valentine
John W. A. Buyers Jeffrey T. Sanfilippo
William D. Fischer
John W. A. Buyers
J. William Petty
PERFORMANCE GRAPH
-----------------
The following Performance Graph compares the Company's
cumulative total stockholder return on its Common Stock for
the period from December 31, 1993 to June 24, 1999 with the
cumulative total return of the Standard & Poor's 500 stock
index and a peer group of companies selected by the Company
(the "Peer Group") for purposes of the comparison and
identified below. Dividend reinvestment has been assumed and,
with respect to companies in the Peer Group, the returns of
each such company have been weighted to reflect relative stock
market capitalization.
Comparison of Cumulative Total Return(1)
Among the Company, S&P 500 Index and Peer Group (2)
The following table represents a comparison of the total return among
John B. Sanfilippo & Son, Inc., the S&P 500 and the Peer Group Index:
Dec-93 Dec-94 Dec-95 Dec-96 Jun-97 Jun-98 Jun-99
------ ------ ------ ------ ------ ------ ------
John B. Sanfilippo 100.00 38.21 64.27 34.74 55.21 33.86 26.77
& Son, Inc.
S&P 500 100.00 101.32 139.37 171.35 223.48 268.94 316.41
Peer Group Index 100.00 84.58 115.90 113.32 159.06 189.94 144.21
(1) Assumes $100 invested on December 31, 1993 in the
Company's Common Stock, S&P 500 Index and Peer
Group.
(2) The Peer Group selected by the Company is comprised of
the following companies: Chock Full O'Nuts Corp., J&J Snack
Foods Corp., Universal Foods Corp. and Tootsie Roll
Industries, Inc. The Peer Group was selected by the
Company in good faith based upon similarities in the nature
of the business of the companies, total revenues,
seasonality of business of the companies and market
capitalization.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
-----------------------------------------------------------
The Compensation Committee, which reviews and makes
recommendations to the Board with respect to salaries, bonuses
and other compensation of officers and other executives, was
comprised of Jasper B. Sanfilippo, Mathias A. Valentine,
William D. Fischer and John W. A. Buyers. Mr. Sanfilippo is
the Company's Chairman of the Board and Chief Executive
Officer. Mr. Valentine is the Company's President.
Below is a summary of certain transactions between the Company
and either of Messrs. Sanfilippo or Valentine, or persons with
whom they are related or entities in which they have an
interest. All such transactions have been and will continue
to be on terms which the Company believes to be at least as
favorable to the Company as could be obtained from
unaffiliated parties.
LEASE ARRANGEMENTS
- ------------------
The Company leases a warehousing and retail facility in Des
Plaines, Illinois (the "Des Plaines Facility") and its
production and office facilities at 2299 Busse Road, Elk Grove
Village, Illinois (the "Busse Road Facility") from land trusts
in which the direct and indirect beneficiaries are Jasper B.
Sanfilippo (a stockholder, director and executive officer of
the Company), Mathias A. Valentine (a stockholder, director
and executive officer of the Company), their respective
spouses, Anne Karacic and Rose Laketa (sisters of Mr.
Sanfilippo) and Rosalie Sanfilippo (Mr. Sanfilippo's mother).
The lease for the Des Plaines Facility expires on October 31,
2010 and provides for monthly rent of $21,250, subject to
periodic increases based on increases in the Consumer Price
Index (the "CPI") on each of June 1, 2003 and June 1, 2005.
The lease for the Busse Road Facility, as amended, expires on
May 31, 2015 and provides for monthly rent of $84,500, subject
to CPI increases on each of June 1, 2002, June 1, 2007 and
June 1, 2012. Previous amendments to the lease delayed a
scheduled CPI increase scheduled for 1995 until June 1, 1997.
Effective January 1, 1998, the lease was further amended to
waive the June 1997 CPI adjustment and increase the rent to
its current level (from $74,084 per month). The increase in
monthly rent is less than the increase that would have been
implemented if the scheduled CPI increase had not been waived.
The leases for the Des Plaines Facility and the Busse Road
Facility also require the Company to pay the real estate taxes
on, and to maintain and insure, the Des Plaines Facility and
the Busse Road Facility. During fiscal 1998, the aggregate
amount of real estate taxes on and insurance premiums paid by
the Company under both leases was approximately $301,000.
The Company constructed an addition to the Busse Road
Facility (the "Addition") which is situated on property owned
by the land trust that owns the Busse Road Facility (the
"Busse Land Trust") and on property owned by the Company.
Accordingly, (i) the Company and the Busse Land Trust entered
into a ground lease with a term beginning January 1, 1995
pursuant to which the Company leases from the Busse Land Trust
the land on which a portion of the Addition is situated and
all related improvements thereon (the "Busse Addition
Property"), and (ii) the Company, the Busse Land Trust and the
sole beneficiary of the Busse Land Trust entered into a party
wall agreement effective as of January 1, 1995, which sets
forth the respective rights and obligations of the Company and
the Busse Land Trust with respect to the common wall which
separates the existing Busse Road Facility and the Addition.
The ground lease has a term which expires on May 31, 2015 (the
same date on which the Company's lease for the Busse Road
Facility expires) and requires the Company to pay the Busse
Land Trust annual rent of $6,425, subject to CPI increases on
each of June 1, 2000, June 1, 2005 and June 1, 2010. The
Company has an option to extend the term of the ground lease
for one five-year term, an option to purchase the Busse
Addition Property at its then appraised fair market value at
any time during the term of the ground lease, and a right of
first refusal with respect to the Busse Addition Property.
The ground lease also requires the Company to pay the real
estate taxes on, and to insure the Busse Addition Property.
The party wall agreement grants the Company the right to use
and the obligation to participate pro rata with the Busse
Partnership (defined below) in the maintenance of the common
wall shared by the Addition and Busse Road Facility.
The sole beneficiary of the Busse Land Trust is the
Arthur/Busse Limited Partnership (the "Busse Partnership").
The general partner of the Busse Partnership is Arthur/Busse
Properties, Inc. The shareholders of Arthur/Busse Properties,
Inc. and the limited partners of the Busse Partnership are
Jasper B. Sanfilippo, Marian Sanfilippo (Mr. Sanfilippo's
wife), Mathias A. Valentine, Mary Valentine (Mr. Valentine's
wife), Anne Karacic and Rose Laketa (sisters of
Mr. Sanfilippo), and Rosalie Sanfilippo (Mr. Sanfilippo's
mother).
SUPPLIER, VENDOR, BROKER AND OTHER ARRANGEMENTS
- -----------------------------------------------
During fiscal 1999, the Company purchased approximately $559
thousand of products and services from Navarro Pecan Company,
Inc., ("Navarro") a processor of pecans, and sold
approximately $1.70 million of products and services to
Navarro. The Company anticipates that it will continue to
make such purchases from and sales to Navarro in fiscal 2000
and thereafter. Jasper B. Sanfilippo, a stockholder, director
and executive officer of the Company, also serves as a
director and officer of Navarro. In addition, Mr. Sanfilippo
owns 33-1/3% of the outstanding common stock of Navarro. The
remaining two-thirds of the outstanding common stock of
Navarro is owned by unaffiliated parties.
During fiscal 1999, the Company purchased approximately $4.67
million of raw materials from an entity in respect of which
Jasper B. Sanfilippo, a stockholder, director and executive
officer of the Company, serves as a director and owns 50% of
the outstanding common stock.
During fiscal 1999, the Company purchased approximately $436
thousand of manufacturing equipment (such as canning and
packaging machinery), engineering services and inventory from
JesCorp, Inc. and MAP Systems International, a division of
JesCorp, Inc. ("JesCorp"). The Company anticipates that it
will continue to make such purchases of products and services
from JesCorp in fiscal 2000 and thereafter. James J.
Sanfilippo and John Sanfilippo are the stockholders, directors
and officers of JesCorp and are employees and stockholders of
the Company and sons of Jasper B. Sanfilippo, a stockholder,
director and executive officer of the Company. Marian
Sanfilippo, Jasper B. Sanfilippo's wife and a beneficial owner
of more than 5% of the Company's outstanding Class A Stock, is
also a director of JesCorp. During fiscal 1999, JesCorp
subleased from the Company approximately 26,820 square feet of
space at the Company's facilities and paid rent for this space
at the rate of $11,976 per month. Effective May 1, 1999,
Jescorp increased the square footage subleased from the
Company to approximately 28,600 feet and adjusted the monthly
rental rate to $12,874. This amount is equal to the amount
paid by the Company in respect of such space (inclusive of
taxes). JesCorp's lease will expire on December 31, 2000.
During fiscal 1999, the Company utilized the services of
Jenner & Block ("Jenner") as legal counsel for a number of
corporate legal matters. The Company anticipates that it will
continue to utilize the services of Jenner when legal counsel
is warranted. Timothy R. Donovan, a nominee for election to
the Company's Board of Directors by the holders of Class A
Stock is currently a partner of Jenner. Mr. Donovan will
resign from Jenner at the end of this calendar year.
During part of fiscal 1999, Gibson Specialty Corporation
("Gibson") rented approximately 8,000 square feet of space
from the Company for $3,577 per month in rent under an oral
month-to-month lease arrangement. Effective January 1999 the
lease arrangement was terminated. Gibson's rent was equal to
the amount paid by the Company in respect of such space
(inclusive of taxes). Gibson is owned by Jerome Evon, the
son-in-law of Jasper B. Sanfilippo.
During fiscal 1999, the Company purchased approximately $84
thousand of raw materials from Dawsen Graphics ("Dawsen").
The Company anticipates that it will continue to purchase raw
materials from Dawsen in fiscal 2000. Dawsen is owned by
Jerome Evon, the son-in-law of Jasper B. Sanfilippo
The Company entered into a three-year agreement with Compass
Sales and Marketing ("Compass") to act as a broker for the
Company. John C. Taylor, Jr., president of Compass, is the
son of John C. Taylor, a former director and former executive
officer of the Company. In their capacity as broker, Compass
makes customer calls, manages brokers, provides retail
services and provides information services. Compass is paid
for their service on terms substantially equivalent to the
terms on which other brokers utilized by the Company are paid.
The Company paid Compass $414,000 during fiscal 1999.
Christopher Taylor, a former employee of the Company, is the
son of John C. Taylor, a former director and former executive
officer of the Company. His total compensation for fiscal
1999 was $67,347.
During fiscal 1999, the Company compensated the following
employees who are related to directors, director nominees, or
executive officers of the Company. James A. Valentine, Vice
President of Management Information Systems, is the son of
Mathias A. Valentine, President and a director of the Company
and the brother of Michael J. Valentine, a director and an
executive officer of the Company. James A. Valentine's total
compensation for fiscal 1999 was $101,561. Roseanne Karacic,
Director of Creative Services, is the sister-in-law of Timothy
R. Donovan, a nominee for election to the Company's Board of
Directors by the holders of Class A stock. Roseanne Karacic's
total compensation for fiscal 1999 was $70,798. Lisa Evon,
Industrial Sales Manager, is the daughter of Jasper B.
Sanfilippo, Chairman of the Board and Chief Executive Officer
and director of the Company, and the sister of Jasper B.
Sanfilippo, Jr., an executive officer of the Company and
Jeffrey T. Sanfilippo, an executive officer and director of
the Company. Lisa Evon's total compensation for fiscal 1999
was $67,771.
RATIFY APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP
AS INDEPENDENT ACCOUNTANTS
------------------------------------------------
The stockholders will be asked to ratify the appointment of the
firm of PricewaterhouseCoopers LLP as the Company's independent
accountants for the fiscal year ending June 29, 2000. This
appointment was made by the Board of Directors on recommendation
of its Audit Committee.
PricewaterhouseCoopers LLP served as independent accountants for
the fiscal year ended June 24, 1999 and it (or its predecessor
by merger, Price Waterhouse LLP) has acted as accountants for
the Company since 1982. Representatives of
PricewaterhouseCoopers LLP are expected to be present at the
Annual 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.
The Board of Directors recommends a vote "FOR" ratification of
the appointment of PricewaterhouseCoopers LLP as independent
accountants for the fiscal year ending June 29, 2000.
The affirmative vote of the holders of shares representing a
majority of the votes entitled to be cast by the holders of
shares present and entitled to vote at the Annual Meeting is
required for ratification of this item. No determination has
been made as to what action the Board of Directors would take if
the appointment is not ratified.
ANNUAL REPORT
-------------
The Company's annual report for the fiscal year ended June 24,
1999 has been included in the mailing of this Proxy Statement.
Stockholders are referred to the report for financial and other
information about the Company, but such report is not
incorporated in this Proxy Statement and is not to be deemed a
part of the proxy soliciting material.
STOCKHOLDER PROPOSALS FOR THE 2000 ANNUAL MEETING
-------------------------------------------------
Any stockholder proposal to be considered for inclusion in the
proxy materials for the Company's 2000 annual meeting of
stockholders must be received at the principal executive offices
of the Company no later than May 18, 2000 and must otherwise
comply with the requirements of Rule 14a-8 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
On May 21, 1998, the Securities and Exchange Commission adopted
an amendment to Rule 14a-4, as promulgated under the Securities
Exchange Act of 1934. The amendment to 14a-4(c)(1) governs the
Company's use of its discretionary proxy voting authority with
respect to a stockholder proposal which the stockholder has not
sought to include in the Company's proxy statement. The new
amendment provides that if a proponent of a proposal fails to
notify the Company at least 45 days prior to the month and day
of mailing of the prior year's proxy statement, then the
management proxies will be allowed to use their discretionary
voting authority when the proposal is raised at the meeting,
without any discussion of the matter in the proxy statement.
With respect to the Company's 2000 annual meeting of
stockholders, if the Company is not provided notice of a
stockholder proposal which the stockholder has not previously
sought to include in the Company's proxy statement by August 1,
2000, the management proxies will be allowed to use their
discretionary authority as outlined above.
PROXY SOLICITATION
------------------
Proxies will be solicited by mail. Proxies may also be
solicited by directors, officers and a small number of regular
employees of the Company personally or by mail, telephone or
telegraph, but such persons will not be specially compensated
for such services. Brokerage houses, custodians, nominees and
fiduciaries will be requested to forward the soliciting material
to the beneficial owners of stock held of record by such
persons, and the Company will reimburse them for their expenses
in doing so. The entire cost of the preparation and mailing of
this Proxy Statement and accompanying materials and the related
proxy solicitation will be borne by the Company.
Stockholders are requested to complete and sign the enclosed
proxy, which is solicited by the Board of Directors, and
promptly return it in the accompanying envelope whether or not
they plan to attend the Annual Meeting in person. The proxy is
revocable at any time before it is voted. Returning the proxy
will in no way limit a stockholder's right to vote at the Annual
Meeting if the stockholder attends and chooses to vote in
person.
OTHER MATTERS
-------------
Management does not intend to present, and does not have any
reason to believe that others will present, any item of business
at the Annual Meeting other than those specifically set forth in
the notice of the Annual Meeting. However, if other matters are
properly presented for a vote, the proxies will be voted for
such matters in accordance with the judgment of the persons
acting under the proxies.
By Order of the Board of Directors
/s/ MICHAEL J. VALENTINE
------------------------
MICHAEL J. VALENTINE
Secretary
Elk Grove Village, Illinois
September 15, 1999
APPENDIX A - CLASS A COMMON STOCK PROXY CARD
- --------------------------------------------
JOHN B. SANFILIPPO & SON, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
ANNUAL MEETING OF STOCKHOLDERS OCTOBER 27, 1999
Jasper B. Sanfilippo, Mathias A. Valentine and Michael J. Valentine, or any
one or more of them, with power of substitution in each, are hereby appointed
the proxies of the undersigned to vote all shares of the Class A Common
Stock of John B. Sanfilippo & Son, Inc., that the undersigned is entitled to
vote at the Annual Meeting of Stockholders to be held October 27, 1999 at
the hour of 10:00 A.M., local time, at the Wyndham Hotel Northwest Chicago,
400 Park Boulevard, Itasca, Illinois 60143, and at all adjournments
thereof, upon such business as may properly come before the meeting,
including the items listed on the reverse side and as more completely
described in the enclosed Notice of Annual Meeting and Proxy Statement:
(THIS PROXY IS CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE.)
- - - -
|X X| Please mark your Nominees: Jasper B. Sanfilippo
| X | vote as in this Mathias A. Valentine
|X X| example. Michael J. Valentine
- - - - Jeffrey T. Sanfilippo
Timothy R. Donovan
FOR WITHHELD
1. Election of Directors by ----- -----
holders of Class A Stock | | | |
| | | |
----- -----
For, except vote withheld from the following nominee(s):
---------------------------------------------------------------------
2. APPROVAL OF APPOINTMENT OF
ACCOUNTANTS: Approval of FOR AGAINST ABSTAIN
appointment of ----- ----- -----
Pricewaterhouse Coopers LLP | | | | | |
as independent accountants | | | | | |
for fiscal 2000. ----- ----- -----
3. UPON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING:
In their discretion, the proxies are authorized to vote on such
other matters as may properly come before the Annual Meeting.
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 DEEMED TO CONSTITUTE DIRECTION TO VOTE "FOR" EACH OF
THE ABOVE PROPOSALS.
Please mark, sign, date and return the proxy card using the enclosed
envelope.
SIGNATURE(S) DATE
---------------------------------- -------------------
NOTE: Please sign exactly as name appears on this Proxy. When shares are
held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee, guardian, corporate officer or partner,
give full title as such. If a corporation, please sign in corporate
name by president or other authorized officer. If a partnership, please
sign in partnership name by authorized person.
APPENDIX B - COMMON STOCK PROXY CARD
- ------------------------------------
JOHN B. SANFILIPPO & SON, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
ANNUAL MEETING OF STOCKHOLDERS OCTOBER 27, 1999
Jasper B. Sanfilippo, Mathias A. Valentine and Michael J. Valentine, or any
one or more of them, with power of substitution in each, are hereby appointed
the proxies of the undersigned to vote all shares of the Common
Stock of John B. Sanfilippo & Son, Inc., that the undersigned is entitled to
vote at the Annual Meeting of Stockholders to be held October 27, 1999 at
the hour of 10:00 A.M., local time, at the Wyndham Hotel Northwest Chicago,
400 Park Boulevard, Itasca, Illinois 60143, and at all adjournments
thereof, upon such business as may properly come before the meeting,
including the items listed on the reverse side and as more completely
described in the enclosed Notice of Annual Meeting and Proxy Statement:
(THIS PROXY IS CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE.)
- - - -
|X X| Please mark your Nominees: Gov. James R. Edgar
| X | vote as in this John W.A. Buyers
|X X| example.
- - - -
FOR WITHHELD
1. Election of Directors by ----- -----
holders of Class A Stock | | | |
| | | |
----- -----
For, except vote withheld from the following nominee(s):
---------------------------------------------------------------------
2. APPROVAL OF APPOINTMENT OF
ACCOUNTANTS: Approval of FOR AGAINST ABSTAIN
appointment of ----- ----- -----
Pricewaterhouse Coopers LLP | | | | | |
as independent accountants | | | | | |
for fiscal 2000. ----- ----- -----
3. UPON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING:
In their discretion, the proxies are authorized to vote on such
other matters as may properly come before the Annual Meeting.
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 DEEMED TO CONSTITUTE DIRECTION TO VOTE "FOR" EACH OF
THE ABOVE PROPOSALS.
Please mark, sign, date and return the proxy card using the enclosed
envelope.
SIGNATURE(S) DATE
---------------------------------- -------------------
NOTE: Please sign exactly as name appears on this Proxy. When shares are
held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee, guardian, corporate officer or partner,
give full title as such. If a corporation, please sign in corporate
name by president or other authorized officer. If a partnership, please
sign in partnership name by authorized person.
