<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
PRICE ENTERPRISES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
------------------------------------------------------------------------
<PAGE>
PRICE ENTERPRISES, INC
4649 MORENA BOULEVARD
SAN DIEGO, CALIFORNIA 92117
---------------------
NOTICE OF ANNUAL MEETING OF
STOCKHOLDERS AND PROXY STATEMENT
To The Stockholders of
Price Enterprises, Inc.
Notice is hereby given that the Annual Meeting of the Stockholders (the
"Meeting") of PRICE ENTERPRISES, INC. (the "Company") will be held at the San
Diego Hilton Beach and Tennis Resort, 1775 E. Mission Bay Drive, San Diego,
California 92109, on Tuesday, January 16, 1996, at 10:00 a.m., for the following
purposes:
1. To elect Directors for the ensuing year to serve until the next
Annual Meeting of Stockholders and until their successors are elected and
have qualified. The present Board of Directors of the Company has nominated
and recommends for election as directors the following seven persons:
Nancy Y. Bekavac Katherine L. Hensley Robert E. Price
William P. Dickey Leon C. Janks
Murray L. Galinson Paul A. Peterson
2. To transact such other business as may properly come before the
Meeting.
The Board of Directors has fixed the close of business on November 20, 1995
as the record date for this solicitation.
Accompanying this Notice is a Proxy. WHETHER OR NOT YOU EXPECT TO BE AT THE
MEETING, PLEASE SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT PROMPTLY.
BY ORDER OF THE BOARD OF DIRECTORS
Daniel T. Carter, SECRETARY
San Diego, California
December 13, 1995
<PAGE>
PRICE ENTERPRISES, INC.
4649 MORENA BOULEVARD
SAN DIEGO, CALIFORNIA 92117
------------------------
PROXY STATEMENT
The Board of Directors of Price Enterprises, Inc. (the "Company") is
soliciting the enclosed Proxy for use at the Annual Meeting of Stockholders of
the Company (the "Meeting") to be held at 10:00 a.m. on Tuesday, January 16,
1996, at the San Diego Hilton Beach and Tennis Resort, 1775 E. Mission Bay
Drive, San Diego, California 92109. This Proxy Statement was first mailed to
stockholders on or about December 13, 1995.
All stockholders who find it convenient to do so are cordially urged to
attend the Meeting in person. In any event, please sign, date and return the
Proxy in the enclosed envelope.
A Proxy may be revoked by written notice to the Secretary of the Company at
any time prior to the voting of the Proxy, or by executing a later Proxy or by
attending the Meeting and voting in person. Unrevoked Proxies will be voted in
accordance with the instructions therein indicated, or if there are no such
instructions, such Proxies will be voted for the election of the Board's
nominees for directors.
The close of business on November 20, 1995 is the record date with respect
to this solicitation. As of that date, 23,234,866 shares of Common Stock, $.0001
par value ("Common Stock"), of the Company were outstanding. Each share of
Common Stock is entitled to one vote. A majority of the outstanding shares of
the Company, represented in person or by Proxy at the Meeting, constitutes a
quorum. All shares represented by Proxies that reflect abstentions or include
"broker non-votes" will be treated as shares that are present and entitled to
vote for purposes of determining the presence of quorum. Abstentions or "broker
non-votes" do not constitute a vote "for" or "against" any matter and thus will
be disregarded in the calculation of "votes cast."
A plurality of the votes cast at the Meeting is required to elect directors.
The affirmative vote of a majority of the shares present in person or
represented by proxy and entitled to vote at the Meeting is required for
approval of all other matters presented at the Meeting.
The cost of preparing, assembling and mailing the Notice, Proxy Statement
and Proxy will be borne by the Company.
<PAGE>
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of shares of the Company's Common Stock as of November 20, 1995 by (i)
certain of the Company's executive officers and directors, (ii) all of the
Company's executive officers and directors as a group and (iii) all other
stockholders known by the Company to beneficially own more than five percent of
the Common Stock.
<TABLE>
<CAPTION>
PERCENT
AMOUNT AND NATURE OF BENEFICIALLY
NAME AND ADDRESS (1) BENEFICIAL OWNERSHIP OWNED
- -------------------------------------------------- -------------------- ------------
<S> <C> <C>
Robert E. Price................................... 2,627,628(2) 11.3%
Paul A. Peterson.................................. 244,279(3) 1.1%
Nancy Y. Bekavac.................................. 2,000(4) *
Murray L. Galinson................................ 5,000(5) *
Katherine L. Hensley.............................. 2,365(6) *
Leon C. Janks..................................... -0-(7) *
James D. Sinegal.................................. -0- *
William P. Dickey (Nominee)....................... -0- *
Theodore Wallace.................................. 51,291(8) *
Daniel T. Carter.................................. 15,000(9) *
Steven A. Velazquez............................... 15,238(10) *
Joseph J. Tebo.................................... 20,100(11) *
Sol Price......................................... 8,293,660(12) 35.7%
Jeffrey S. Halis.................................. 1,175,200(13) 5.1%
All Executive Officers and Directors as a group
(13 persons)..................................... 3,003,867 12.9%
</TABLE>
- ------------------------
* Less than 1% beneficially owned.
(1) The address for all persons listed, other than Sol Price and Jeffrey S.
Halis, is c/o the Company, 4649 Morena Boulevard, San Diego, California
92117. The address for Sol Price is c/o Price Entities, 7979 Ivanhoe Avenue,
Suite 520, La Jolla, California 92037. The address for Jeffrey S. Halis is
500 Park Avenue, Fifth Floor, New York, New York 10022.
(2) 2,627,128 shares are beneficially owned by Robert E. Price. Of such
2,627,128 shares, 92,132 shares are held through trusts of which Mr. Price
is a trustee. Mr. Price disclaims beneficial ownership of 500 shares which
are held by a foundation of which Mr. Price is a director.
(3) Includes 10,000 shares subject to non-qualified stock options which are
exercisable after December 21, 1995. All such options have an exercise price
of $14.00 and expire on December 21, 2004. Excludes 40,000 shares subject to
non-qualified stock options which are not presently exercisable, and which
have an exercise price of $14.00 and expire on December 21, 2004.
(4) Includes 2,000 shares subject to non-qualified stock options which are
exercisable after December 21, 1995. All such options have an exercise price
of $14.00 and expire on December 21, 2004. Excludes 8,000 shares subject to
non-qualified stock options which are not presently exercisable, and which
have an exercise price of $14.00 and expire on December 21, 2004.
(5) Includes 2,000 shares subject to non-qualified stock options which are
exercisable after December 21, 1995. All such options have an exercise price
of $14.00 and expire on December 21, 2004. Excludes 8,000 shares subject to
non-qualified stock options which are not presently exercisable, and which
have an exercise price of $14.00 and expire on December 21, 2004. Includes
2
<PAGE>
1,500 shares held by a partnership for the benefit of Mr. Galinson's adult
children, over which Mr. Galinson exercises sole investment power. Mr.
Galinson disclaims beneficial ownership over such 1,500 shares.
(6) Includes 2,000 shares subject to non-qualified stock options which are
exercisable after December 21, 1995. All such options have an exercise price
of $14.00 and expire on December 21, 2004. Excludes 8,000 shares subject to
non-qualified stock options which are not presently exercisable, and which
have an exercise price of $14.00 and expire on December 21, 2004.
(7) Excludes 10,000 shares subject to non-qualified stock options which are not
presently exercisable, and which have an exercise price of $12.00 and expire
on March 24, 2005.
(8) Includes 20,000 shares subject to non-qualified stock options which are
exercisable after January 12, 1995. All such options have an exercise price
of $11.25 and expire on January 12, 2001. Excludes 80,000 shares subject to
non-qualified stock options which are not presently exercisable, and which
have an exercise price of $11.25 and expire on January 12, 2001.
(9) Includes 15,000 shares subject to non-qualified stock options which are
exercisable after January 12, 1995. All such options have an exercise price
of $11.25 and expire on January 12, 2001. Excludes 60,000 shares subject to
non-qualified stock options which are not presently exercisable, and which
have an exercise price of $11.25 and expire on January 12, 2001.
(10) Includes 15,000 shares subject to non-qualified stock options which are
exercisable after January 12, 1995. All such options have an exercise price
of $11.25 and expire on January 12, 2001. Excludes 60,000 shares subject to
non-qualified stock options which are not presently exercisable, and which
have an exercise price of $11.25 and expire on January 12, 2001.
(11) Includes 20,000 shares subject to non-qualified stock options which are
exercisable after January 12, 1995. All such options have an exercise price
of $11.25 and expire on January 12, 2001. Excludes 80,000 shares subject to
non-qualified stock options which are not presently exercisable, and which
have an exercise price of $11.25 and expire on January 12, 2001.
(12) 8,293,160 shares are beneficially owned by Sol Price and are held through
trusts of which Mr. Price is a trustee. Mr. Price disclaims beneficial
ownership of 500 shares which are held by a foundation of which Mr. Price is
a director.
(13) 1,085,000 shares are owned by Tyndall Partners, L.P., a Delaware limited
partnership. 90,200 shares are owned by Madison Avenue Partners, L.P., a
Delaware limited partnership. Pursuant to the Agreement of Limited
Partnership of each of Tyndall Partners, L.P. and Madison Avenue Partners,
L.P., Jeffrey S. Halis possesses sole voting and investment control over all
securities owned by Tyndall Partners, L.P. and Madison Avenue Partners,
L.P., respectively. All information concerning Mr. Halis, Tyndall Partners,
L.P. and Madison Avenue Partners, L.P. is based upon information provided to
the Company by Mr. Halis.
3
<PAGE>
ELECTION OF DIRECTORS
The Board of Directors of the Company has nominated and recommends for
election as Directors the following seven persons to serve until the next Annual
Meeting of Stockholders and until their respective successors shall have been
duly elected and shall qualify. All of the nominees, other than William P.
Dickey, are presently Directors of the Company. The enclosed Proxy will be voted
in favor of the persons nominated unless otherwise indicated. If any of the
nominees should be unable to serve or should decline to do so, the discretionary
authority provided in the Proxy will be exercised by the present Board of
Directors to vote for a substitute or substitutes to be designated by the Board
of Directors. The Board of Directors does not believe at this time that any
substitute nominee or nominees will be required. In the event that a nominee for
Director is proposed at the Meeting, the enclosed proxy may be voted in favor of
or against such nominee or any other nominee proposed by the Board of Directors.
The table below indicates the name, position with the Company and age of
each nominee for Director.
<TABLE>
<CAPTION>
NAME POSITION WITH PRICE ENTERPRISES AGE
- ---------------------------------------- --------------------------------- ---
<S> <C> <C>
Robert E. Price Chairman of the Board, President 53
and Chief Executive Officer
Paul A. Peterson Vice Chairman of the Board 67
Nancy Y. Bekavac Director 48
Murray L. Galinson Director 58
Katherine L. Hensley Director 58
Leon C. Janks Director 46
William P. Dickey Nominee for Director 52
</TABLE>
Robert E. Price has been Chairman of the Board, President and Chief
Executive Officer of Price Enterprises since July 28, 1994. Mr. Price was
Chairman of the Board of Price/Costco, Inc. from October 1993 to December 1994.
From 1976 to October 1993, he was Chief Executive Officer and a Director of The
Price Company. Mr. Price served as Chairman of the Board of The Price Company
from January 1989 to October 1993, and as its President from 1976 until December
1990. In addition to his role in Price Enterprises, Mr. Price also serves as (i)
President and Chief Executive Officer of Price Real Estate, Inc., Price Global
Trading, Inc. and Old MC, Inc., (ii) Chief Executive Officer of Price Quest,
Inc., and (iii) a Director of Price Real Estate, Inc., Price Global Trading,
Inc., Price Quest, Inc., Price Ventures, Inc. and Old MC, Inc.
Paul A. Peterson is a lawyer and is a senior member of the law firm of
Peterson & Price in San Diego. He was a Director of Price/Costco, Inc. from
October 1993 until December 1994. From 1976 to October 1993, he was Secretary
and, except for a period of eleven months in 1982, a Director of The Price
Company. Mr. Peterson served as Vice Chairman of the Board of The Price Company
from November 1991 to October 1993. Mr. Peterson also serves as a Director of
Price Real Estate, Inc., Price Global Trading, Inc., Price Quest, Inc., Price
Ventures, Inc. and Old MC, Inc.
Katherine L. Hensley is presently Of Counsel to the law firm of O'Melveny &
Myers in Los Angeles, California. Ms. Hensley joined O'Melveny & Myers in 1978
and was a partner from 1986 to February 1992. Ms. Hensley is a Trustee of
Security First Trust, an open-end investment management company registered under
the Investment Company Act of 1940.
Nancy Y. Bekavac has been the President of Scripps College in Claremont,
California since July 1990. From September 1988 to May 1990, Ms. Bekavac was
Counselor to the President of Dartmouth College in Hanover, New Hampshire. Ms.
Bekavac is also a Director of Pioneer Hi-Bred International, Inc. and Electro
Rent Corporation.
4
<PAGE>
Murray L. Galinson has been the President and Chief Executive Officer of San
Diego National Bank and SDNB Financial Corp. since September 1984 and has been a
Director of both entities since their inception in 1981. Mr. Galinson's name has
been submitted to the President of the United States for nomination as a United
States District Judge for the Southern District of California. If Mr. Galinson
is nominated by the President and his appointment is then confirmed by the
United States Senate, the Company anticipates that Mr. Galinson would resign as
a Director of the Company. If Mr. Galinson were to resign prior to the Meeting,
the Board of Directors would designate a substitute nominee. If Mr. Galinson is
elected as a Director at the Meeting and he were to resign after that time, the
Board of Directors has the authority under the Company's By-laws to fill such
vacancy at its discretion.
Leon C. Janks has been a Partner in the accounting firm of Alder, Green &
Hasson in Los Angeles, California since 1980. Mr. Janks has extensive experience
in domestic and international business serving a wide variety of clients in
diverse businesses.
William P. Dickey has been the owner and President of W.P. Dickey & Co.,
Ltd., a California real estate investment and advisory firm, since October 1991.
From February 1986 to November 1990, he was a Managing Director at The First
Boston Corporation, an investment banking firm (now known as CS First Boston).
Prior to joining First Boston, Mr. Dickey was a Partner with the law firm of
Cravath, Swaine & Moore from May 1980 to February 1986. Mr. Dickey is a Trustee
of The Retail Property Trust, an institutionally-owned REIT with investments in
regional shopping centers, a Director of HGI Realty, Inc., a publicly-traded
REIT which owns factory outlet shopping centers, and a Director of Mezzanine
Capital Property Investors, a privately-held REIT with an investment focus on
office properties.
INFORMATION CONCERNING THE BOARD OF DIRECTORS AND CERTAIN COMMITTEES THEREOF
The Board of Directors held four meetings during fiscal 1995. Each person
who was a director during fiscal 1995 attended more than 75% of the total number
of meetings of the Board (except that James Sinegal abstained from participating
in two meetings).
COMMITTEES OF PRICE ENTERPRISES
AUDIT COMMITTEE. The Audit Committee, which consists of Ms. Bekavac and
Messrs. Janks and Peterson, held two meetings during fiscal 1995, which were
attended by all members. The Audit Committee reviews the annual audits of Price
Enterprises' independent public accountants, Ernst & Young, LLP; reviews and
evaluates internal accounting controls; recommends the selection of the
Company's independent public accountants; reviews and passes upon (or ratifies)
related party transactions; and conducts such reviews and examinations as it
deems necessary with respect to the practices and policies of, and the
relationship between, Price Enterprises and its independent public accountants.
COMPENSATION COMMITTEE. The Compensation Committee, which consists of Ms.
Bekavac, Mr. Galinson and Ms. Hensley, held five meetings during fiscal 1995
which were attended by all members. The Compensation Committee reviews salaries,
bonuses and stock options of executive officers of Price Enterprises, and
administers Price Enterprises' executive compensation policies and stock option
plans.
NOMINATING COMMITTEE. The Nominating Committee, which consists of Ms.
Hensley and Messrs. Peterson and Price, held one meeting in fiscal 1995 which
was attended by all members. The Nominating Committee recommends candidates to
fill vacancies on the Board of Directors or any committee thereof, which
vacancies may be created by the departure of any directors, or the expansion of
the number of members of the Board. The Nominating Committee will give
appropriate consideration to qualified persons recommended by stockholders for
nomination as directors provided that such recommendations are accompanied by
information sufficient to enable the Nominating Committee to evaluate the
qualifications of the nominee.
5
<PAGE>
REAL ESTATE COMMITTEE. The Real Estate Committee, which consists of Messrs.
Peterson and Price, held 25 meetings in fiscal 1995 which were attended by all
members. The Real Estate Committee reviews and approves (i) sales (including
sale-leasebacks), leases, conveyances, transfers or other dispositions of real
property, and (ii) purchases, leases or other acquisitions of real property,
except, in each case for any such transactions entered into in the ordinary
course of business of Price Enterprises.
EXECUTIVE COMMITTEE. The Executive Committee, which consists of Messrs.
Galinson, Price and Peterson, held no formal meetings during fiscal 1995. The
Executive Committee has been established with all powers and rights necessary to
exercise the full authorities of the Board of Directors in the management of the
business and affairs of Price Enterprises, except as provided in the Delaware
General Corporation Law or the Bylaws of Price Enterprises.
FINANCE COMMITTEE. The Finance Committee, which consists of Messrs. Price,
Galinson and Janks, held one meeting in fiscal 1995 which was attended by all
members. The Finance Committee reviews and makes recommendations with respect to
(i) annual budgets, (ii) investments, (iii) financing arrangements and (iv) the
creation, incurrence, assumption or guaranty by Price Enterprises of any
indebtedness, obligation or liability, except, in each case, for any such
transactions entered into in the ordinary course of business of Price
Enterprises.
COMPENSATION OF THE BOARD OF DIRECTORS
Each outside director of Price Enterprises (other than Mr. Peterson)
receives $20,000 per year for serving on the Board of Directors and an
additional $5,000 per year for serving as chairman of any committee of the
Board. Mr. Peterson received $75,000 per year until July 1, 1995, at which time
his compensation was increased to $100,000 per year, for his services as Vice
Chairman of the Board and as a chairman or member of any committee of the Board.
In addition, outside directors (other than Mr. Peterson) who serve on committees
of the Board (in a capacity other than chairman of a committee) receive $500 for
each meeting attended. The chairman or vice chairman of any Committee may
receive additional compensation to be fixed by the Board. Each non-employee
director is eligible to receive stock grants and stock options pursuant to The
Price Enterprises Directors' 1995 Stock Option Plan. Employee directors are
eligible to receive stock grants and stock options pursuant to The Price
Enterprises 1995 Combined Stock Grant and Stock Option Plan.
Directors also receive reimbursement for travel expenses incurred in
connection with their duties as directors.
6
<PAGE>
EXECUTIVE COMPENSATION
The following table shows, for fiscal years 1993, 1994 and 1995, the
compensation earned by the Chief Executive Officer and the four most highly
compensated executive officers of the Company and its subsidiaries (the "Named
Executive Officers") at the end of fiscal 1995. Amounts shown for fiscal years
1993 and 1994 represent monies paid and stock options granted by Price/Costco,
Inc. to such employees prior to the formation of Price Enterprises, Inc. as of
the beginning of fiscal 1995.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION -----------------
--------------------------------------------- SECURITIES
NAME AND OTHER ANNUAL UNDERLYING ALL OTHER
PRINCIPAL POSITION(S) YEAR SALARY ($) BONUS ($) COMPENSATION ($)(1) OPTIONS/SARS (#) COMPENSATION ($)(2)
- ------------------------ --------- ----------- ----------- ------------------- ----------------- ---------------------
<S> <C> <C> <C> <C> <C> <C>
Robert E. Price, 1995 243,340 -0- -0- -0- 9,500
President and Chief 1994 295,385 -0- -0- 34,100 16,759
Executive Officer 1993 270,000 -0- -0- -0- 16,563
Theodore Wallace, 1995 215,191 -0- 100,000(3) 100,000 9,500
Executive Vice-President 1994 259,584 36,000 70,528(4) 20,000 16,759
1993 259,584 -0- -0- 21,300 16,563
Daniel T. Carter, 1995 179,361 35,000 -0- 75,000 9,280
Executive 1994 147,692 27,000 -0- 15,000 10,588
Vice-President,
CFO and Secretary 1993 133,846 -0- -0- 7,987 9,790
Steven A. Velazquez, 1995 188,051 -0- 75,000(3) 75,000 9,500
Executive Vice-President 1994 225,000 36,000 -0- 20,000 16,000
1993 211,615 -0- -0- 13,312 15,334
Joseph J. Tebo 1995 162,176 -0- -0- 100,000 -0-
President of Price 1994 N/A N/A N/A N/A N/A
Ventures, Inc. 1993 N/A N/A N/A N/A N/A
</TABLE>
- ------------------------------
(1) Except as otherwise indicated, perquisites to each officer did not exceed
the lesser of $50,000 or 10% of the total salary and bonus for such
officer.
(2) Amounts shown for fiscal 1995 constitute contributions to The Price
Enterprises Inc. Profit Sharing and 401(k) Plan and the Company's 401(k)
matching contributions of $250 on behalf of each Named Executive Officer
(other than $140 on behalf of Mr. Carter).
(3) Amounts constitute retention bonuses paid to Messrs. Wallace and Velazquez
for agreeing to transfer employment from Price/Costco, Inc. to the Company
in fiscal 1995.
(4) Represents $52,190 paid to reimburse Mr. Wallace for a decline in the
market value of his home which was sold in connection with his relocation
at the request of Price/Costco, Inc. (net of a mortgage prepayment penalty
which was paid by Mr. Wallace) and $18,338 paid to reimburse Mr. Wallace
for income taxes related to such payments.
7
<PAGE>
The following table sets forth information regarding the grant of stock
options during fiscal 1995 to the Named Executive Officers:
OPTION GRANTS IN FISCAL 1995
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE AT
INDIVIDUAL GRANTS ASSUMED ANNUAL
---------------------------------------------------------------------- RATES OF STOCK PRICE
NUMBER OF PERCENT OF TOTAL EXERCISE APPRECIATION
SECURITIES OPTIONS GRANTED TO PRICE FOR OPTION TERM (1)
UNDERLYING EMPLOYEES PER SHARE EXPIRATION --------------------
NAME OPTIONS GRANTED (#) IN FISCAL 1995 (2)(%) ($/SH) DATE (3) 5% ($) 10% ($)
- ------------------- ------------------- ----------------------- ----------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Robert E. Price -0- N/A N/A N/A N/A N/A
Theodore Wallace 100,000 9.18 11.25 1/12/01 382,608 868,006
Daniel T. Carter 75,000 6.89 11.25 1/12/01 286,956 651,005
Steven A. Velazquez 75,000 6.89 11.25 1/12/01 286,956 651,005
Joseph J. Tebo 100,000 9.18 11.25 1/12/01 382,608 868,006
</TABLE>
- ------------------------------
(1) The dollar amounts under these columns are the result of calculations at
the assumed compounded market appreciation rates of 5% and 10% as required
by the Securities and Exchange Commission over a six-year term and,
therefore, are not intended to forecast possible future appreciation, if
any, of the stock price.
(2) No stock appreciation rights were granted to any of the Named Executive
Officers or other Company employees in fiscal 1995.
(3) The options become exercisable at 20% per year over a period of five years
from the date of grant and expire six years from the date of grant.
The following table sets forth information with respect to the Named
Executive Officers concerning the exercise of options during fiscal 1995 and
unexercised options held as of September 3, 1995.
OPTION EXERCISES IN FISCAL 1995 AND
SEPTEMBER 3, 1995 OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF
UNEXERCISED
NUMBER OF IN-THE-MONEY
UNEXERCISED OPTIONS AT
OPTIONS AT SEPTEMBER 3,
SEPTEMBER 3, 1995(#) 1995 ($)(1)
NUMBER OF SHARES -------------------- ----------------------
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE (#) REALIZED ($) UNEXERCISABLE UNEXERCISABLE
- ------------------------ ----------------- ------------- -------------------- ----------------------
<S> <C> <C> <C> <C>
Robert E. Price N/A N/A N/A N/A
Theodore Wallace -0- -0- -0-/100,000 -0-/325,000
Daniel T. Carter -0- -0- -0-/75,000 -0-/243,750
Steven A. Velazquez -0- -0- -0-/75,000 -0-/243,750
Joseph J. Tebo -0- -0- -0-/100,000 -0-/325,000
</TABLE>
- ------------------------
(1) Based a price of $14.50 per share, the last reported sales price of the
Company's Common Stock on September 1, 1995, as quoted by The Nasdaq Stock
Market National Market.
PROFIT SHARING AND 401(K) PLAN
From August 29, 1994 until January 1, 1995, employees of Price/Costco, Inc.,
who were leased to Price Enterprises and its subsidiaries, generally received
benefits under The Price Company Retirement Plan or under The Price Company
401(k) Plan. Subsequent to January 1, 1995, the Board of Directors of Price
Enterprises adopted The Price Enterprises Inc. Profit Sharing and 401(k) Plan
(the "Plan"), which includes terms and conditions substantially similar to The
Price Company Retirement Plan and The Price Company 401(k) Plan.
The Plan is a profit-sharing plan designed to be a "qualified" plan under
applicable provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), covering all non-union employees who
8
<PAGE>
have completed one year of service, as that term is defined in the Plan. Under
the Plan, the Company may, in its discretion, make annual contributions which
shall not exceed for each participant the lesser of: (a) 25% of the
participant's compensation for such year, or (b) the greater of (i) 25% of the
defined benefit dollar limitation then in effect under section 415(b)(1) of the
Code or (ii) $30,000. In addition, participants may make voluntary
contributions. In addition, the Plan permits employees to defer (in accordance
with section 401(k) of the Code) a portion of their salary and contribute those
deferrals to the Plan.
All participants in the Plan are fully vested in their voluntary
contributions. Vesting in the remainder of a participant's account is based upon
his or her years of service with the Company and in his or her salary deferrals.
A participant initially is 20% vested after the completion of two years of
service with the Company, an additional 20% vested after the completion of three
years of service, and an additional 20% vested after the completion of each of
his or her next three years of service, so that the participant is 100% vested
after the completion of six years of service.
A participant becomes fully vested in his or her entire account upon
retirement due to permanent disability, attainment of age 65, or death. In
addition, the Plan provides that the Board of Directors of the Company may at
any time declare the Plan partially or completely terminated, in which event the
account of each participant with respect to whom the Plan is terminated will
become fully vested.
The Board of Directors also has the right at any time to discontinue
contributions to the Plan. If the Company fails to make one or more substantial
contributions to the Plan for any period of three consecutive years in each year
of which the Company realized substantial current earnings, such failure will
automatically be deemed a complete discontinuance of contributions. In the event
of such a complete discontinuance of contributions, the account of each
participant will become fully vested.
EMPLOYMENT CONTRACTS
Steven Velazquez is the only one of the Named Executive Officers that
presently has an employment agreement with the Company. Mr. Velazquez originally
entered into an employment agreement with Price Enterprises for a term of one
year commencing November 1, 1994, which has been extended to January 31, 1996.
Pursuant to this agreement, Mr. Velazquez receives a base annual salary of
$175,000 during the term of this agreement. Mr. Velazquez may not engage in any
activities, with or without compensation, that would interfere with the
performance of his duties or that would be adverse to Price Enterprises'
interests, without the prior written consent of Price Enterprises. The agreement
provides that Mr. Velazquez will be eligible to participate in the Company's
bonus plan and receive all other benefits offered to officers under Price
Enterprises' standard company benefits practices and plans. Mr. Velazquez may
terminate the agreement at any time on 30 days' prior written notice. Price
Enterprises may terminate the agreement for cause upon immediate notice thereof,
or upon the death or disability of Mr. Velazquez. In the event that Price
Enterprises terminates the agreement for any reason other than cause, or if
there is a substantial and material change in Mr. Velazquez' job
responsibilities resulting from an action by Price Enterprises, Mr. Velazquez
shall be entitled to a severance payment of $337,500, less applicable deductions
and withholdings, and to inclusion in the stock option plan, profit sharing and
401(k) plan and medical plans of Price Enterprises for the remainder of the term
of the agreement. The foregoing severance benefits are the exclusive benefits
that would be payable to Mr. Velazquez by reason of his termination, and Price
Enterprises is not obligated to segregate any assets or procure any investment
in order to fund such severance benefits. The agreement also contains
confidentiality provisions and other terms and conditions customary to executive
employment agreements.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1995, the Company's Compensation Committee consisted of Ms.
Bekavac, Mr. Galinson and Ms. Hensley. Prior to the consummation of the exchange
offer by Price/Costco, Inc. through which Price Enterprises, Inc. became a
publicly-held corporation (the "Exchange Offer"), the Company's initial
three-member Board of Directors, consisting of Messrs. Peterson, Price and James
D. Sinegal (the "Initial Board"), supervised matters regarding executive
compensation. In
9
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addition to his role as a Director, Mr. Price is also Chairman of the Board,
Chief Executive Officer and President of the Company. In addition to his role as
a Director of the Company, James D. Sinegal is also the President, Chief
Executive Officer and a Director of Price/Costco, Inc. For a discussion of
certain transactions between the Company and Price/Costco, Inc., see "Certain
Relationships and Related Transactions -- Relationship with Price/Costco, Inc."
set forth elsewhere in this Proxy Statement.
JOINT REPORT ON EXECUTIVE COMPENSATION
In this year of transition, executive compensation was first supervised by
the Initial Board, and thereafter by the expanded Board of Directors and its
Compensation Committee. As noted above, the Company's Initial Board was composed
of Robert Price, Paul Peterson and James Sinegal. Upon consummation of the
Exchange Offer on December 21, 1994, Ms. Bekavac, Mr. Galinson, and Ms. Hensley
joined the Board, and effective March 24, 1995, Mr. Janks became the seventh
Board member.
The Compensation Committee is composed of three independent non-employee
directors: Ms. Bekavac, Mr. Galinson and Ms. Hensley. The Committee is
responsible for reviewing salaries, bonuses and stock options of the executive
officers of the Company (which include the Chief Executive Officer, Chief
Financial Officer and Executive Vice Presidents of the Company), and
administering the Company's compensation plans for senior officers and the
Company's stock option plan, including the granting of options and awards of
stock thereunder.
The following report is a joint report of the Initial Board, the current
Board, and the Compensation Committee.
GENERAL COMPENSATION PHILOSOPHY
The Company's executive compensation policies are designed with the
following objectives: (i) to attract and retain talented executives; (ii) to
appropriately reward individual achievement; and (iii) to enhance the financial
performance of the Company, and thus stockholder value, by significantly
aligning the financial interests of the Company's executives with those of its
stockholders. To accomplish these objectives the Company's executive
compensation program consists of: (i) annual base salaries; (ii) cash bonuses;
and (iii) stock option grants.
Executive officers also participate in other benefit plans available to
employees generally, including the Company's Profit Sharing and 401(k) Plan and
a medical plan.
ANNUAL BASE SALARIES AND BONUSES
Base salaries are determined by considering the recommendations of the Chief
Executive Officer, together with such factors as job complexity, level of
responsibility, how the position relates to the Company's long-term strategic
goals, and the particular individual's skills, experience and background. While
there were no pre-established weightings given to these factors, particular
importance was placed on attracting and retaining quality individuals in this
first year of the Company's existence in order to develop an effective executive
team for the Company. The aforementioned six-member Board of Directors approved
the annual base salaries for Robert Price, Daniel Carter and Theodore Wallace.
The Initial Board approved the annual base salaries for the remaining executive
officers.
The Company's discretionary annual bonus program is designed to reward the
Company's executive officers for individual achievement in supporting the
fulfillment of corporate objectives. During the past year the Compensation
Committee awarded a bonus to the Company's Chief Financial Officer (Daniel
Carter) and its General Counsel (Robert Gans), in recognition of their efforts
with regard to the Company's "spin off" from Price/Costco, Inc. and the
establishment of essential policies and procedures for the new Company. In
addition, upon formation of the Company, each of Theodore Wallace and Steven
Velazquez received a retention bonus for agreeing to transfer employment from
Price/Costco, Inc. to the Company.
10
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STOCK OPTIONS
The long-term incentive aspect of the Company's executive compensation
program is realized by the granting of stock options. During this initial year
of the Company, stock option awards have been viewed as a particularly effective
tool to attract experienced and talented employees, and to encourage their
long-term quality performance with the Company. Stock options are granted by the
Compensation Committee at a price equal to the fair market value on the date of
grant. Stock options are generally exercisable at the rate of 20% per year,
thereby providing an incentive for the grantee to remain with the Company. Since
the value of the stock option is dependent upon stock performance, the stock
option program directly aligns employee compensation with the interests of the
Company's stockholders. Stock options are granted by the Compensation Committee
based upon the recommendations of senior management. In making option grants,
the Compensation Committee considers the anticipated future performance of the
employee and that individual's ability to positively impact the achievement of
the Company's objectives.
CHIEF EXECUTIVE OFFICER COMPENSATION
Robert Price is the Chairman, Chief Executive Officer and President of the
Company. The extent of Mr. Price's significant expertise and potential for
guiding the development of the Company in its formative year were considered in
approving Mr. Price's annual base salary. No independent surveys were
commissioned to determine competitive compensation since the Board considered
Mr. Price's annual base salary of $225,000 to be modest, in view of his position
and responsibilities with the Company. Additionally, Mr. Price declined to be
considered for receipt of either a cash bonus or stock option grant for the
fiscal 1995 period. Mr. Price nonetheless maintains a personal economic interest
in the performance of the Company, in view of Mr. Price's ownership of
approximately 11.3% of the Company's outstanding Common Stock.
OMNIBUS BUDGET RECONCILIATION ACT IMPLICATIONS FOR EXECUTIVE COMPENSATION
It is the responsibility of the Board (or Compensation Committee) to address
the issues raised by a recent change in the tax laws which made certain
non-performance-based compensation to executives of public companies in excess
of $1,000,000 non-deductible to the Company. In this regard, a determination
must be made as to whether any actions with respect to this new limit should be
taken by the Company. At this time, it is not anticipated that any executive
officer will receive compensation in excess of this limit. Therefore, no action
was taken to comply with the new limit. Appropriate action will be taken if it
is warranted in the future.
SUMMARY
It is believed that the above-described cash compensation program and
long-term incentives in the form of stock option awards provided to the
Company's executive officers function effectively, so as to link employee
performance with the performance of the Company and increasing stockholder
value.
Nancy Bekavac
Murray Galinson
Katherine Hensley
Leon Janks
Paul Peterson
Robert Price
James Sinegal
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PERFORMANCE GRAPH
The graph below compares the cumulative total stockholder return on the
shares of the Company's Common Stock for fiscal year 1995 (commencing on
December 21, 1994, the date on which the Company became a publicly-held
corporation) with the cumulative total return of The Nasdaq Stock Market Index
(US)(1) and a peer group comprised of certain other real estate operators and
lessors(2) over the same period (assuming the investment of $100 in the Common
Stock, stocks comprising The Nasdaq Stock Market Index (US) and stocks
comprising the peer group on December 21, 1994 and the reinvestment of all
dividends).
COMPARISON OF CUMULATIVE TOTAL RETURNS SINCE DECEMBER 21, 1994(3)
AMONG PRICE ENTERPRISES, INC., THE NASDAQ STOCK MARKET INDEX (US)
AND A PEER GROUP OF CERTAIN REAL ESTATE OPERATORS AND LESSORS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPANY INDEX MARKET INDEX PEER INDEX
<S> <C> <C> <C>
12/21/94 100 100 100
1/3/95 89.286 100.934 100.505
2/3/95 80.357 104.866 98.338
3/3/95 91.071 108.719 101.187
4/3/95 85.268 111.314 104.166
5/3/95 82.143 115.503 104.379
6/2/95 86.607 118.805 106.809
7/3/95 96.429 127.222 112.955
8/3/95 105.357 133.671 120.408
9/1/95 104.117 138.92 124.495
</TABLE>
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(1) The Nasdaq Stock Market Index (US) was prepared by the Center for Research
in Security Prices and includes all U.S. Nasdaq Stock Market companies.
(2) The peer group index was prepared by the Center for Research in Security
Prices and includes certain U.S.-based securities traded on the NYSE, AMEX
and NASDAQ with standard industrial codes (SIC) of 6510-6519, generally
comprising Real Estate Operators (except Developers) and Lessors. The peer
group companies include American Industrial Properties, REIT, Cardinal
Realty Services, Inc., Crocker Realty Investors, Inc., EB Inc., Great
Northern Iron Ore Properties, Gyrodyne Company America, Inc., Home Holdings,
Inc., Hospitality Franchise Systems, Inc., Independence Holding Co.,
Insignia Financial Group, Inc., Intergroup Corp., Irvine Apartment
Communities, Inc., LNH REIT, Inc., J.W. Mays, Inc., Midwest Real Estate
Shopping Center, L.P., National Capital Management Corp., Pamida Holdings
Corp., Presidential Realty Corp., The Price REIT, Resurgence Properties,
Inc., Rouse Company, Shopco Laurel Center, L.P., Shopco Stores, Inc., Simon
Property Group, Inc., Sizeler Property Investors, Inc., United Dominion
Realty Trust, Inc., United Mobile Homes, Inc., Urban Shopping Centers, Inc.
and Weingarten Realty Investors. Peer return is weighted by market
capitalization.
(3) Stockholder returns over the indicated period should not be considered
indicative of future stockholder returns. The lines on the graph represent
monthly index levels derived from compounded daily returns including all
dividends. The indices are reweighted daily, using market capitalization on
the previous trading day.
12
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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
RELATIONSHIP WITH PRICE/COSTCO, INC.
The Company has a substantial relationship with Price/Costco, Inc
("PriceCostco"). Mr. James D. Sinegal, presently a Director of the Company, is
also the Chief Executive Officer, President and a Director of PriceCostco. The
Company leases four properties to PriceCostco for use as Price Club warehouse
clubs, which generated rents of approximately $8.6 million in fiscal 1995.
Pursuant to the Amended and Restated Agreement of Transfer and Plan of Exchange
between the Company and PriceCostco, the Company repurchased approximately 3.8
million shares of its Common Stock from PriceCostco on February 21, 1995 for
approximately $45.9 million, payable in the form of a promissory note due
December 1996 secured by the 3.8 million repurchased shares. On April 20, 1995,
the Company sold its 51% interest in Mexico Clubs, LLC (which owns 50% of Price
Club Mexico) to PriceCostco, and $30.5 million of the proceeds were applied
against the $45.9 million promissory note; at the closing, the Company also
received a $4 million payment from Price Club Mexico.
The Company owns 51% of Price Quest, Inc. ("Price Quest"), with PriceCostco
owning the remaining 49% interest. Pursuant to an Operating Agreement between
Price Quest and PriceCostco, PriceCostco is obligated to provide floor space in
certain Price Club and Costco warehouse clubs for the Quest electronic shopping
kiosk network, the Price Club travel program and the Price Club automobile
buying/referral program (each of which are owned by Price Quest), as well as
certain staffing, cashiering and other services in exchange for a fee based on
sales, and subject to certain conditions. Under the Operating Agreement, Price
Quest is obligated to purchase a minimum of $3 million of advertising in
Price/Costco's membership publications in fiscal 1995 and 1996. In fiscal 1995,
Price Quest paid PriceCostco aggregate payments of approximately $9.0 million
pursuant to the Operating Agreement. In addition, Price Quest paid PriceCostco
approximately $5.9 million in connection with certain display inventory used in
the Quest electronic kiosk areas at the warehouse clubs. In addition, there are
other agreements among PriceCostco, the Company and Price Quest including
agreements regarding trademarks and trade names, certain non-competition
provisions, and transfer restrictions if either the Company or PriceCostco
offers to transfer, sell, assign or otherwise dispose of its interest in the
corporation.
The Company owns 51% of Price Global Trading, Inc. ("Price Global"), with
PriceCostco owning the remaining 49% interest. Pursuant to an Operating
Agreement between Price Global Trading and PriceCostco, PriceCostco is obligated
to provide certain buying support, merchandising services, training and other
information to Price Global for a period of five years. Price Global reimburses
PriceCostco for its costs of providing such services. In addition, there are
other agreements among PriceCostco, the Company and Price Global including
agreements regarding trademarks and trade names, certain non-competition
provisions, and transfer restrictions if either the Company or PriceCostco
offers to transfer, sell, assign or otherwise dispose of its interest in the
corporation.
RELATIONSHIP WITH THE PRICE REIT
The Company has engaged in certain transactions which indirectly benefit The
Price REIT, a publicly-held real estate investment trust. Sol Price, who
beneficially owns approximately 35.7% of the Company's outstanding Common Stock,
is the father of Robert Price, the Chairman of the Board, President and Chief
Executive Officer of the Company. Sol Price also has beneficial ownership
through various family and charitable trusts of approximately 9% of the Class B
Common Stock of The Price REIT. The Price REIT owns all of the outstanding
preferred stock and is entitled to receive 90% of the cash flow of K&F
Development Company.
On August 29, 1994, the Company entered into a development agreement with
K&F Development Company for the development of four properties. Under this
agreement, K&F Development Company will receive development fees of 6% of the
aggregate construction costs expended with respect to such properties.
K&F Development Company and The Price Company, a subsidiary of PriceCostco,
previously entered into a development agreement dated December 16, 1993, in
connection with the development (except for the development of the Price Club
located on such property) of the Company's property
13
<PAGE>
located in Pentagon City, Virginia (the "Pentagon City Property"). In connection
with the Exchange Offer transaction, PriceCostco assigned this development
agreement to the Company. Pursuant to this agreement (i) K&F Development Company
received a development fee equal to 3% of the aggregate construction costs
expended with respect to such property; (ii) all operating cash flows generated
from the Pentagon City Property (other than the Price Club located on such
property) were allocated to the Company until the property generated a return on
"invested capital" of 9% ("invested capital" means all costs associated with the
development of the property, plus 4% of such costs, compounded annually); and
(iii) all operating cash flows in excess of the amount allocated to the Company
(as described in the previous clause) were allocated 75% to the Company and 25%
to K&F Development Company. In addition, upon any sale of the Pentagon City
Property by the Company in which the return on invested capital exceeds 9%, K&F
Development Company was entitled to receive 25% of the net sale proceeds in
excess of the Company's invested capital and its return on such invested capital
of 9%. On October 1, 1995 the Company and K&F terminated the Pentagon City
development agreement. Prior to termination the Company paid to K&F $845,731,
and under the terms of the termination agreement, the Company paid K&F
Development Company an additional $850,000 in full and final settlement of any
and all remaining amounts due to K&F under the Pentagon City Property
development agreement.
On August 29, 1994, the Company entered into a Consulting Agreement with K&F
Development Company pursuant to which K&F would provide strategic and consulting
services for the next two years to the Company. K&F Development Company was to
receive $500,000 annually as payment for such services. During fiscal year 1995,
K&F Development Company received $500,000 under the Consulting Agreement. The
Consulting Agreement was terminated by mutual agreement on September 3, 1995.
The Company and K&F entered in a new Consulting Agreement as of September 4,
1995 which expires on February 28, 1996. K&F will receive $90,000 as payment for
services to be performed under the new Consulting Agreement.
On March 7, 1995, the Company entered into three separate Brokerage
Agreements with K&F Development Company to sell and/or lease 16 of the Company's
properties. Under the terms of these Brokerage Agreements, K&F will earn a
brokerage fee of up to 5.0% of ten times the fixed annual rent for new tenants
introduced by K&F. In addition, K&F can earn up to a maximum of 5.0% of the
gross proceeds received by the Company upon the sales of these properties, if
sold to purchasers introduced by K&F.
On September 29, 1995, the Company entered into a Brokerage and Consulting
Agreement with K&F Development Company for the development of property located
in Dallas, Texas. Pursuant to this agreement, K&F receives (i) development fees
of $100,000, and (ii) an incentive bonus equal to (A) 25% of all profits (as
defined therein) earned by the Company in excess of $1,550,000, less (B) the
development fees earned by K&F. In addition, K&F will act as the exclusive
broker for this project. As the exclusive broker, K&F will earn a brokerage fee
equal to 3.0% of ten times the fixed annual rent paid by tenants of the project,
subject to a cap of $850,000.
In addition, The Price REIT performs property management services for
certain of the properties owned by the Company. In fiscal year 1995 the Company
paid $737,000 in fees to The Price REIT for such management services.
RELATIONSHIP WITH WILLIAM P. DICKEY
William P. Dickey, a nominee for Director, provided strategic consulting
services to the Company from May 1 to August 31, 1995, pursuant to which Mr.
Dickey was paid $30,000. In addition, the Company may retain Mr. Dickey to
perform strategic consulting services to the Company in fiscal year 1996.
RELATIONSHIP WITH INDEPENDENT AUDITORS
The Company's financial statements for the year ended September 3, 1995 have
been examined by Ernst & Young, LLP. A representative of Ernst & Young, LLP is
expected to be available at the Meeting to respond to appropriate questions and
to make a statement if he desires to do so. The Company's Audit Committee will
select independent auditors for the current year sometime after the Meeting.
14
<PAGE>
As previously noted, on December 21, 1994, the Company and PriceCostco
consummated the Exchange Offer transaction in which PriceCostco, the Company's
former corporate parent, implemented a spin-off reorganization that resulted in
the Company becoming a separate, publicly-held corporation. Following the
consummation of such transaction, the Company determined to change its principal
independent accountant from Arthur Andersen LLP, the principal independent
accountant of PriceCostco, to Ernst & Young LLP. The Board of Directors of the
Company approved the change of principal independent accountant to Ernst & Young
LLP on January 18, 1995. Arthur Andersen LLP was dismissed as the Company's
principal independent accountant as of January 24, 1995, and Ernst & Young LLP
was engaged as of the same date.
The report of Arthur Andersen LLP on the financial statements for the
Company's fiscal year 1994 (which was the only year in which Arthur Andersen LLP
performed an audit for the Company) did not contain any adverse opinion or
disclaimer of opinion, nor was it qualified as to uncertainty, audit scope or
accounting principles. In addition, during the Company's most recent fiscal year
and the subsequent interim period preceding January 24, 1995, there were no
disagreements with Arthur Andersen LLP on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure, which
disagreement, if not resolved to the satisfaction of Arthur Andersen LLP, would
have caused Arthur Andersen LLP to make a reference to the subject matter of the
disagreement in connection with its reports.
SECTION 16(A) REPORTING
Under Section 16(a) of the Exchange Act, directors, executive officers and
beneficial owners of 10% or more of the Common Stock ("Reporting Persons") are
required to report to the Securities and Exchange Commission on a timely basis
the initiation of their status as a Reporting Person and any changes with
respect to their beneficial ownership of the Common Stock. Based solely on its
review of such forms received by it, the Company believes that all filing
requirements applicable to its directors, executive officers and beneficial
owners of 10% or more of the Common Stock were complied with during fiscal 1995.
STOCKHOLDER PROPOSALS
Any proposal of a stockholder of the Company intended to be presented at the
next Annual Meeting of Stockholders of the Company must be received by the
Secretary of the Company not later than August 15, 1996 to be considered for
inclusion in the Company's proxy statement and form of proxy relating to that
meeting.
OTHER MATTERS
The Company does not know of any business other than that described herein
which will be presented for consideration or action by the stockholders at the
Annual Meeting. If, however, any other business shall properly come before the
Annual Meeting, shares represented by Proxies will be voted in accordance with
the best judgment of the persons named therein or their substitutes.
ANNUAL REPORT TO STOCKHOLDERS
The Company's Annual Report to Stockholders is being mailed with this Proxy
Statement to stockholders on or about December 13, 1995. Upon request the
Company will furnish the Annual Report to any stockholder.
BY ORDER OF THE BOARD OF DIRECTORS
Daniel T. Carter, SECRETARY
San Diego, California
December 13, 1995
15
<PAGE>
PROXY PRICE ENTERPRISES, INC.
4649 MORENA BOULEVARD
SAN DIEGO, CALIFORNIA 92117
THE UNDERSIGNED STOCKHOLDER(S) OF PRICE ENTERPRISES, INC. (THE
"COMPANY") HEREBY CONSTITUTES AND APPOINTS ROBERT E. PRICE AND DANIEL T.
CARTER, AND EACH OF THEM, ATTORNEYS AND PROXIES OF THE UNDERSIGNED, EACH WITH
POWER OF SUBSTITUTION, TO ATTEND, VOTE AND ACT FOR THE UNDERSIGNED AT THE
ANNUAL MEETING OF STOCKHOLDERS OF THE COMPANY TO BE HELD ON JANUARY 16, 1996,
AND AT ANY ADJOURNMENT OR POSTPONEMENT THEREOF, ACCORDING TO THE NUMBER OF
SHARES OF COMMON STOCK OF THE COMPANY WHICH THE UNDERSIGNED MAY BE ENTITLED TO
VOTE, AND WITH ALL THE POWERS WHICH THE UNDERSIGNED WOULD POSSESS IF
PERSONALLY PRESENT, AS FOLLOWS:
(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE)
<PAGE>
I plan to attend the meeting. / /
1. ELECTION OF DIRECTORS
/ / FOR ALL NOMINEES LISTED BELOW (except as marked to the contrary below)
/ / WITHHOLD AUTHORITY to vote for all nominees listed below
(INSTRUCTION: To withhold authority to vote for any individual nominee, mark
the box next to the nominee's name below.)
/ / Nancy Y. Bekavac / / Katherine L. Hensley / / Robert E. Price
/ / Murray L. Galinson / / Leon C. Janks
/ / William P. Dickey / / Paul A. Peterson
2. In their discretion, the Proxies are authorized to transact such
other business as may properly come before the 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 voted
for election of the Board's nominees for directors.
Please sign exactly as name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee, or guardian, please give full title as such. If a corporation, please
sign in full corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
- -----------------------------------
Signature
- -----------------------------------
Signature if held jointly
DATED:
---------------------
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
