<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Supervalu Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(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>
LOGO
- -------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD THURSDAY, JUNE 26, 1997
The Annual Meeting of Stockholders of SUPERVALU INC. will be held on
Thursday, June 26, 1997, at 10:30 a.m., local time, at The Minneapolis
Convention Center, 1301 Second Avenue South, Minneapolis, Minnesota 55403 for
the following purposes:
. to elect three directors;
. to approve the selection of Deloitte & Touche LLP as independent
auditors;
. to vote on an amendment to the SUPERVALU INC. 1993 Stock Plan;
. to vote on an amendment to the SUPERVALU INC. 1983 Employee Stock Option
Plan;
. to vote on an amendment to the SUPERVALU INC. Long-Term Incentive Plan;
. to consider a stockholder proposal;
and to transact such other business as may properly come before the meeting.
RECORD DATE
The Board of Directors has fixed the close of business on May 7, 1997, as
the record date for the purpose of determining stockholders who are entitled
to notice and vote at the meeting. Common and preferred stockholders are
entitled to one vote for each share held of record at that time.
IMPORTANT: We hope you will be able to attend the meeting in person and you
are cordially invited to attend. If you expect to attend the meeting, please
check the appropriate box on the proxy card when you return your proxy or
follow the instructions on your proxy card to vote and to confirm your
attendance by telephone. Parking is available for stockholders in the Plaza
municipal parking ramp and the Orchestra Hall ramp located across the street
from The Minneapolis Convention Center. A map showing the location of The
Minneapolis Convention Center and designated parking areas is included on your
proxy card. If you need special assistance because of a disability, please
contact me at P.O. Box 990, Minneapolis, Minnesota 55440.
BY ORDER OF THE BOARD OF DIRECTORS
TERESA H. JOHNSON
Secretary
May 23, 1997
<PAGE>
PROXY STATEMENT--VOTING PROCEDURES
- -------------------------------------------------------------------------------
YOUR VOTE IS VERY IMPORTANT
. VOTING BY MAIL. Whether or not you expect to attend the meeting, please
sign, date, and mail your proxy promptly in the enclosed postage paid
envelope.
. VOTING BY TELEPHONE. If you wish to vote by telephone, please follow the
instructions on the enclosed proxy card; if you vote by telephone you do
not need to return the proxy card.
. NOTE: If you wish to abstain from voting, or choose to vote some proposals
in favor and others against the Board of Directors' recommendation, you
must do so by signing the proxy card and returning it in the postage paid
envelope provided.
It is important that all stockholders vote. If you sign, date and mail your
proxy without indicating how you want to vote, your proxy will be voted as
recommended by the Board of Directors.
VOTE REQUIRED AND METHOD OF COUNTING VOTES
. NUMBER OF SHARES OUTSTANDING. SUPERVALU has two classes of capital stock
outstanding. The holders of Common Stock and Preferred Stock are entitled
to one vote for each share held, voting together as one class. 66,961,199
shares of Common Stock and 5,876 shares of Preferred Stock are eligible to
vote at the meeting.
. VOTE REQUIRED. The following is an explanation of the vote required for
each of the items to be voted on.
ELECTION OF DIRECTORS (ITEM 1)
The three nominees receiving the highest number of votes will be elected.
Shareholders who do not wish their shares to be voted for a particular nominee
may so indicate in the space provided on the proxy card.
ALL OTHER ITEMS (ITEMS 2-6)
The affirmative vote of a majority of shares present in person or by proxy is
required for approval of Items 2 through 6. Shares represented by a proxy
marked "abstain" on any matter will be considered present at the meeting for
purposes of determining a quorum and for purposes of calculating the vote, but
will not be considered to have voted in favor of the proposal. Therefore, any
proxy marked "abstain" will have the effect of a vote of the shares against
the item. Shares represented by a proxy as to which there is a "broker non-
vote" (i.e. where a broker does not have discretionary authority to vote the
shares) will be considered present at the meeting for purposes of determining
a quorum, but will have no effect on the vote.
REVOKING YOUR PROXY
You may revoke your proxy at any time before it is voted by sending a written
statement to the Secretary, or by submitting another proxy with a later date.
You may also revoke your proxy by appearing and voting at the meeting.
VOTING BY PARTICIPANTS IN THE EMPLOYEE STOCK OWNERSHIP PLAN, THE EMPLOYEE
STOCK PURCHASE PLAN AND THE SUPERVALU PRE-TAX SAVINGS AND PROFIT SHARING
(401(K)) PLAN
If you own SUPERVALU shares as a participant in one of the above plans, you
will receive a single proxy card that covers both the shares credited to your
plan account(s) and shares you own that are registered in the same name. If
any of your plan accounts are not in the same name as your shares of record,
you will receive separate proxy cards for your record and plan holdings.
Proxies submitted by plan participants will serve as voting instructions to
the trustee(s) for these plans whether provided by mail or by telephone.
OTHER BUSINESS
The Board knows of no other matters to be presented for stockholder action at
the meeting. If other matters are properly brought before the meeting, the
persons named in the accompanying proxy card intend to vote the shares
represented by them in accordance with their best judgment. This Proxy
Statement will be first mailed to Stockholders on or about May 23, 1997.
1
<PAGE>
MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD
- -------------------------------------------------------------------------------
The Board of Directors held six regular meetings during the last fiscal year.
Each director attended more than 75% of the meetings of the Board and its
committees on which the director served. The Executive Committee of the Board
does not have scheduled meetings and did not meet during the year. The Board
maintains four other committees: Audit, Finance, Executive Personnel and
Compensation, and Director Affairs. Membership on the Audit and Executive
Personnel and Compensation Committees is limited to non-employee directors.
AUDIT COMMITTEE
The following directors serve on the Audit Committee: Garnett L. Keith, Jr.
(Chairman), Stephen I. D'Agostino, Vernon H. Heath, Richard L. Knowlton,
Charles M. Lillis, and Harriet Perlmutter. The Audit Committee met twice in
the last fiscal year.
The primary responsibilities of the Audit Committee are to:
. Assess and recommend to the full Board of Directors and the stockholders
the selection of independent auditors;
. Review and evaluate the scope of the annual audit and the activities and
reports of the independent auditors;
. Review the objectives, scope, and results of internal audit examinations
and the status of management actions for implementing the recommendations;
and
. Review compliance with the Company's Code of Conduct.
FINANCE COMMITTEE
The following directors serve on the Finance Committee: Herman Cain
(Chairman), Stephen I. D'Agostino, Edwin C. Gage, Garnett L. Keith, Jr.,
Charles M. Lillis, Carole F. St. Mark, and Michael W. Wright. The Finance
Committee met twice in the last fiscal year.
The primary responsibilities of the Finance Committee are to review the
financial structure, policies, and future financial plans of the Company and
to make recommendations concerning them to the Board. In carrying out these
responsibilities, the Finance Committee periodically reviews:
. The annual operating and capital budgets of the Company as proposed by
management, and performance by the Company as compared to the approved
budgets;
. Dividend policy and rates;
. Investment performance of the Company's employee benefit plans;
. Company financing arrangements;
. The Company's capital structure, including key financial ratios such as
debt to equity ratios and coverage of fixed charges; and
. Proposals for changes in the capitalization of the Company, including
purchases of treasury stock.
DIRECTOR AFFAIRS COMMITTEE
The following directors serve on the Director Affairs Committee: William A.
Hodder (Chairman), Lawrence A. Del Santo, Vernon H. Heath, Harriet Perlmutter,
Winston R. Wallin, and Michael W. Wright. The Director Affairs Committee met
twice in the last fiscal year.
The mission of the Director Affairs Committee is to recommend a framework to
assist the Board in fulfilling its corporate governance responsibilities. In
carrying out its mission, the Director Affairs Committee establishes and
regularly reviews the Board of Directors' policies and procedures which
provide:
. Criteria for the size and composition of the Board;
. Procedures for the conduct of Board meetings including executive sessions
of the Board;
. Policies on director retirement and resignation;
. Criteria regarding personal qualifications needed for Board membership; and
. Appropriate compensation for directors.
2
<PAGE>
In addition, the Director Affairs Committee has responsibility to:
. Consider and recommend nominations for Board membership and the composition
of Board Committees;
. Evaluate Board practices at SUPERVALU and other well-managed companies and
recommend appropriate changes to the Board; and
. Consider governance issues raised by stockholders and recommend appropriate
responses to the Board.
EXECUTIVE PERSONNEL AND COMPENSATION COMMITTEE
The following directors serve on the Executive Personnel and Compensation
Committee: Edwin C. Gage (Chairman), Lawrence A. Del Santo, Herman Cain,
William A. Hodder, Richard L. Knowlton, Carole F. St. Mark, and Winston R.
Wallin. This Committee met four times in the last fiscal year and took action
by unanimous consent on two occasions.
The primary functions of the Executive Personnel and Compensation Committee
are to:
. Determine the process to evaluate the performance of the Chief Executive
Officer;
. Review and recommend to the Board the compensation of the Chief Executive
Officer;
. Review and recommend to the Board major changes in executive compensation
programs, executive stock options, and retirement plans for officers;
. Consider and make recommendations to the Board concerning the annual
election of corporate officers and the Company's succession plan;
. Approve annual salaries and bonuses of corporate officers and other
executives at specified levels;
. Review and approve participants and performance targets under annual and
long-term incentive compensation plans; and
. Approve stock option grants and awards under the Company's stock option
plans, bonus and other incentive plans.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
- -------------------------------------------------------------------------------
The following table sets forth information with respect to the only persons or
groups known to the Company as of April 1, 1997, to be the beneficial owner of
more than 5% of its Common Stock.
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT
BENEFICIAL HOLDER BENEFICIAL OWNERSHIP OF CLASS
------------------- -------------------- --------
<S> <C> <C>
Sanford C. Bernstein & Co., 6,220,008 9.3%
Inc.
One State Street Plaza
New York New York 10004 (1)
INVESCO PLC 4,836,200 7.2%
11 Devonshire Square
London, EC2M 4YR
England (2)
</TABLE>
- --------
(1) Based on information in a Schedule 13G Report dated December 31, 1996,
delivered to the Company and indicating that Sanford C. Bernstein & Co.,
Inc. is beneficial owner of 6,220,008 shares, possesses sole voting power
with respect to 3,581,663 shares, and shared voting power with respect to
699,913 shares as of December 31, 1996.
(2) Based on information in a Schedule 13G Report dated February 10, 1997,
delivered to the Company and indicating that INVESCO PLC and certain of
its subsidiaries are the beneficial owners of 4,836,200 shares of Common
Stock and possess shared voting and dispositive power with respect to such
shares as of February 10, 1997.
3
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
- -------------------------------------------------------------------------------
The following table sets forth information, as of April 1, 1997, concerning
beneficial ownership of SUPERVALU Common Stock by each director and nominee,
by each of the executive officers and former executive officers named in the
Summary Compensation Table on page 9, and by all directors and executive
officers as a group. The definition of beneficial ownership for proxy
statement purposes includes shares over which a person has sole or shared
voting power, and shares over which a person has sole or shared dispositive
power, whether or not a person has any economic interest in the shares.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
NAME OF BENEFICIAL OPTIONS EXERCISABLE
BENEFICIAL OWNER OWNERSHIP(2) WITHIN 60 DAYS(3) PERCENT OF CLASS
---------------- -------------------- ------------------- ----------------
<S> <C> <C> <C>
Herman Cain 1,488 8,100 *
Stephen I.
D'Agostino 2,516 8,100 *
Lawrence A. Del
Santo 608 3,000 *
Edwin C. Gage 16,188 8,100 *
Vernon H. Heath 2,488 8,100 *
William A. Hodder 3,290 6,900 *
Garnett L. Keith,
Jr. 2,784 8,100 *
Richard L. Knowlton 2,458 5,100
Charles M. Lillis 2,716 4,200 *
Harriet Perlmutter 7,499 8,100 *
Carole F. St. Mark 2,188 6,900 *
Winston R. Wallin 1,488 8,100 *
Michael W. Wright
(1) 113,914 265,435 *
Laurence L. Anderson 52,512 149,680 *
Jeffrey Noddle 25,675 120,040 *
Jeffrey C. Girard 11,011 104,750 *
David L. Boehnen 9,899 67,300 *
Phillip A. Dabill 17,033 94,632 *
All directors and
executive officers
as a group
(28 persons) 373,686 1,266,837 (3)
</TABLE>
- --------
* Less than 1%.
(1) Includes 5,900 shares held by or for a child of Mr. Wright, as to which
shares he disclaims beneficial ownership; and 4,000 shares held in a
retirement trust for Mr. Wright.
(2) The persons listed have sole voting and investment power with respect to
the shares listed except as follows. The following persons have shared
voting and investment power: Mr. Gage: 4,000 shares; Ms. Perlmutter: 1,500
shares; Mr. Wright: 21,776 shares; and Mr. Anderson: 15,255 shares. The
following non-employee directors have sole voting power, but no investment
power, over shares held in the Non-Employee Directors Deferred Stock Plan
Trust as follows: Herman Cain: 488 shares; Stephen I. D'Agostino: 1,716
shares; Lawrence A. Del Santo: 608 shares; Edwin C. Gage: 488 shares;
Vernon H. Heath: 488 shares; William A. Hodder: 1,890 shares; Garnett L.
Keith, Jr.: 784 shares; Richard L. Knowlton: 1,458 shares; Charles M.
Lillis: 1,716 shares; Harriet Perlmutter: 799 shares; Carole F. St. Mark:
488 shares; and Winston R. Wallin: 488 shares.
(3) All directors and executive officers as a group (28 persons) beneficially
owned 1,640,523 shares of the outstanding Common Stock constituting
approximately 2.5% of the outstanding Common Stock of the Company as of
April 1, 1997. Options exercisable within 60 days are deemed beneficially
owned.
4
<PAGE>
ELECTION OF DIRECTORS (ITEM 1)
- -------------------------------------------------------------------------------
NOMINEES FOR ELECTION AS DIRECTORS FOR TERMS EXPIRING AT THE ANNUAL MEETING IN
2000
The Board is divided into three classes with the number of directors to be
divided as equally as possible among the three classes. Directors are elected
for staggered terms of three years. If a vacancy occurs during the year, the
vacant directorship may be filled by the vote of the remaining directors until
the next Annual Meeting, at which time the stockholders elect a director to
fill the balance of the unexpired term or the term established by the Board.
Lawrence A. Del Santo, William A. Hodder and Harriet Perlmutter are nominated
for three-year terms expiring in 2000. Winston R. Wallin and Vernon H. Heath
are retiring from the Board and are therefore not seeking reelection.
SUPERVALU wishes to thank them for their valuable contributions to the Board.
Following the Annual Meeting, there will be 11 members of the Board.
The Board of Directors is informed that each of the three nominees is willing
to serve as a director; however, if any nominee is unable to serve or for good
cause will not serve, the proxy may be voted for another person as the holders
of the proxies decide.
The following sets forth information, as of April 1, 1997, concerning the
three nominees for election as directors of the Company and as to the eight
directors of the Company whose terms of office will continue after the Annual
Meeting.
LAWRENCE A. DEL SANTO, age 63
. Chairman and a Director of The Vons Companies, Inc. (a retail grocery
company) from 1995 to April, 1997
. Chief Executive Officer of The Vons Companies from 1994 to April, 1997
. Senior Executive Vice President and Chief Operating Officer--Food for
American Stores Company from 1993 to April, 1994
. Chairman and Chief Executive Officer of Lucky Stores, Inc., a subsidiary of
American Stores Company from 1989 to 1993
. Appointed a Director of SUPERVALU in August, 1996
WILLIAM A. HODDER, age 65
. Chief Executive Officer of Donaldson Company, Inc. from 1982 to 1996
. Elected a Director of SUPERVALU in 1990
. Also a Director of Norwest Corporation, The Tennant Company, ReliaStar
Financial Corp., The Musicland Group, Inc. and Cowles Media Company
HARRIET PERLMUTTER, age 65
. Trustee of the Papermill Playhouse (The State Theatre of New Jersey)
. Elected a Director of SUPERVALU in 1978
5
<PAGE>
DIRECTORS WHOSE TERMS EXPIRE AT THE ANNUAL MEETING IN 1999
EDWIN C. GAGE, age 56
. Chairman and Chief Executive Officer of GAGE Marketing Group, L.L.C. (an
integrated marketing services company) since 1991
. President and Chief Executive Officer of Carlson Companies, Inc. (a
diversified services company principally engaged in hotel, restaurant,
travel services and incentives businesses) from 1989 to 1991
. President and Chief Operating Officer of Carlson Companies, Inc. from 1984
to 1989
. Elected a Director of SUPERVALU in 1986
. Also a Director of Fingerhut Companies, Inc.
GARNETT L. KEITH, JR., age 61
. Chairman and Chief Executive Officer of SeaBridge Investment Advisors, LLC
(a registered investment company) since 1996
. Vice Chairman of The Prudential Insurance Company of America (an insurance
company) from 1984 to 1996
. Elected a Director of SUPERVALU in 1984
. Also a Director of Pan-Holding Societe Anonyme
RICHARD L. KNOWLTON, age 64
. Chairman of the Hormel Foundation (a charitable foundation controlling
41.7% of Hormel Foods Corporation) since 1995
. Chairman and a Director of Hormel Foods Corporation (a food manufacturing
company) from 1981 to 1995
. President of Hormel Foods Corporation from 1979 to 1992
. Chief Executive Officer of Hormel Foods Corporation from 1981 to 1993
. Elected a Director of SUPERVALU in 1994
. Also a Director of ReliaStar Financial Corp. and First Bank System, Inc.,
and a member of the Board of Trustees, Mayo Foundation
CAROLE F. ST. MARK, age 54
. President and Chief Executive Officer of Pitney Bowes Business Services, a
unit of Pitney Bowes, Inc. (a company engaged in the production and supply
of business and business-related products and services) since 1994
. President of Pitney Bowes Logistics Systems and Business Services from 1990
to 1994
. President of Pitney Bowes Business Supplies and Services Division from 1988
to 1990
. Vice President, Corporate Planning & Development of Pitney Bowes, Inc. from
1985 to 1988
. Elected a Director of SUPERVALU in 1989
. Also a Director of Grand Metropolitan, PLC
6
<PAGE>
DIRECTORS WHOSE TERMS EXPIRE AT THE ANNUAL MEETING IN 1998
HERMAN CAIN, age 51
. Chief Executive Officer and President of the National Restaurant
Association (a membership association of restaurant companies) since
December 1996
. Chairman of the Board of Godfather's Pizza, Inc. (a company engaged in the
operation and franchising of pizza restaurants) since 1986
. Chief Executive Officer of Godfather's Pizza, Inc. from 1986 to December
1996
. Elected a Director of SUPERVALU in 1991
. Also a Director of Whirlpool Corporation, Utilicorp United, Inc., and
Nabisco Holdings, Inc.
STEPHEN I. D'AGOSTINO, age 63
. President and Chief Executive Officer of D'Agostino Enterprises (an
investment management company) since 1994
. Chairman of D'Agostino Investments (an investment management company) from
1992 to 1994
. Chairman of Lord Capital Corporation (an investment management company)
from 1988 to 1992
. Elected a Director of SUPERVALU in 1983
. Also a Director of Catalina Marketing Corp.
CHARLES M. LILLIS, age 55
. Executive Vice President of US WEST, Inc. (a diversified multimedia
communication company) since 1987
. President and Chief Executive Officer of US WEST Media Group, a division of
US WEST, Inc. since April 1995
. Elected a Director of SUPERVALU in 1995
. Also a Director of Commercial Federal Bank Corp. and Ascent Entertainment
Group Inc.
MICHAEL W. WRIGHT, age 58
. Chairman of the Board, President and Chief Executive Officer of the Company
since 1982
. Elected a Director of SUPERVALU in 1977
. Also a Director of Honeywell Inc., The Musicland Group, Inc., ShopKo
Stores, Inc., and Norwest Corporation
7
<PAGE>
COMPENSATION OF DIRECTORS
- -------------------------------------------------------------------------------
Non-Employee directors receive the following compensation for their Board
service:
. Cash retainer of $20,000 per year;
. Deferred retainer of $15,000 per year payable in SUPERVALU Common Stock
under the Non-Employee Directors Deferred Stock Plan;
. $1,300 for each Board meeting attended;
. $1,000 for each Committee meeting attended; and
. An option to purchase 3,000 shares of Common Stock when the director joins
the Board and at the time of the Company's annual meeting in each even
numbered year. The option is granted at current fair market value and is
fully exercisable on grant.
Committee chairpersons receive an additional annual retainer in the following
amounts:
. Audit, Finance, and Director Affairs Committees: $2,500; and
. Executive Personnel and Compensation Committee: $4,000.
Effective June 27, 1996, the Company's retirement/deferral program for
directors was discontinued and benefits previously earned by directors were
frozen. A director first elected to SUPERVALU's Board prior to June 27, 1996
will receive at termination an annual payment of $20,000 per year for the
number of years of the director's Board service prior to June 27, 1996, but
not more than ten years. Directors first elected to the Board after June 27,
1996 do not participate in the retirement/deferral program.
Directors may elect to defer payment of their directors' fees under one or
more of the following arrangements:
. DIRECTORS DEFERRED COMPENSATION PLAN AND EXECUTIVE DEFERRED COMPENSATION
PLANS. Fees and quarterly interest are credited to an account for the
director, until payment is made from the plan following retirement from the
Board.
. NON-EMPLOYEE DIRECTORS DEFERRED STOCK PLAN. Fees are credited to a deferred
stock account for each director. To encourage increased stock ownership, a
director who chooses to defer payment of cash fees into this plan will
receive deferred stock equal to 110% of the fee otherwise payable. The
Company contributes the deferred cash fee to an irrevocable trust and the
trust purchases shares of SUPERVALU Common Stock. The trust assets remain
subject to the claims of the Company's creditors. Each director is entitled
to direct the trustee to vote all shares allocated to the director's
account in the trust. The Common Stock will be distributed to each director
following the director's retirement from the Board.
8
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
- -------------------------------------------------------------------------------
The following table shows compensation for each of the last three fiscal years
of the Chief Executive Officer, the other four most highly compensated persons
serving as executive officers at the end of the fiscal year, and Phillip A.
Dabill, who retired as an executive officer during the fiscal year.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION AWARDS
------------------------------------ ---------------------
SECURITIES
OTHER RESTRICTED UNDERLYING
ANNUAL STOCK OPTIONS/ ALL OTHER
NAME AND COMPENSATION AWARDS SARS COMPENSATION
PRINCIPAL POSITION YEAR SALARY($) BONUS($) ($) ($)(1) (#)(2) ($)(3)
------------------ ---- --------- -------- ------------ ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
MICHAEL W. WRIGHT 1997 $819,000 $532,350 $1,430 $ 0 80,000 $3,375
Chairman, President and 1996 780,000 438,516 1,254 0 150,000 1,848
Chief Executive Officer 1995 780,000 0 7,292 0 50,000 6,120
LAURENCE L. ANDERSON 1997 420,000 218,400 1,181 0 15,000 3,375
Executive Vice President 1996 402,500 193,864 3,149 0 45,000 1,848
1995 387,000 19,350 2,569 321,250 25,000 6,120
JEFFREY NODDLE 1997 420,000 210,000 46 0 25,000 3,375
Executive Vice President 1996 387,300 190,416 146 0 55,000 1,848
1995 327,003 16,350 4,443 0 18,750 6,120
JEFFREY C. GIRARD 1997 366,000 183,000 0 0 10,000 3,375
Executive Vice President 1996 353,600 166,775 192 0 45,000 1,848
and Chief Financial 1995 340,000 17,000 1,872 0 18,750 6,120
Officer
DAVID L. BOEHNEN 1997 250,000 104,000 0 0 10,000 3,375
Senior Vice President 1996 236,000 90,936 0 0 31,500 1,848
1995 224,000 10,752 0 0 9,375 6,120
PHILLIP A. DABILL 1997 362,500 118,510 185 0 10,000 3,375
Former Executive Vice 1996 355,000 167,436 392 0 45,000 1,848
President 1995 338,000 16,900 1,633 0 18,750 6,120
</TABLE>
- --------
(1) In fiscal 1995, Mr. Anderson received a special award of 10,000 shares of
restricted stock. The 10,000 shares had a fair market value as of February
22, 1997 of $315,000. No other shares of restricted stock are held by the
named officers. For purposes of this table, shares of restricted stock are
valued based on the closing price of the Company's Common Stock on the
date of grant. Dividends are paid on all shares of restricted stock.
(2) A limited stock appreciation right has been granted in tandem with each
option reported in the table, and is exercisable for cash in lieu of the
related option only upon a Change of Control.
(3) Amounts of All Other Compensation are the amounts contributed during the
fiscal year by the Company under the Pre-Tax Savings and Profit Sharing
(401(k)) Plan.
9
<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
- -------------------------------------------------------------------------------
The following table provides information on grants of stock options and stock
appreciation rights for fiscal 1997 to the named executive officers.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
----------------------------------------------
POTENTIAL
PERCENT OF REALIZABLE VALUE
NUMBER OF TOTAL AT ASSUMED ANNUAL
SECURITIES OPTIONS/SARS RATES OF STOCK PRICE
UNDERLYING GRANTED TO EXERCISE APPRECIATION FOR PRIOR COLUMNS
OPTIONS/SARS EMPLOYEES OR BASE OPTION TERM ($)(3) ANNUALIZED (3)(4)
GRANTED IN PRICE EXPIRATION --------------------- -----------------
NAME (#)(1)(2) FISCAL YEAR ($/SHARE) DATE 5% 10% 5% 10%
---- ------------ ------------ --------- ---------- ---------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Michael W. Wright....... 80,000 10.44% $31.38 06/27/06 $1,578,526 $4,000,294 $157,853 $400,029
Laurence L. Anderson.... 15,000 2.00% 31.63 02/27/00 98,773 212,044 24,693 53,011
Jeffrey Noddle.......... 25,000 3.26% 31.63 04/08/06 497,220 1,260,053 49,722 126,005
Jeffrey C. Girard....... 10,000 1.30% 31.63 04/08/06 198,888 504,021 19,889 50,402
David L. Boehnen........ 10,000 1.30% 31.63 04/08/06 198,888 504,021 19,889 50,402
Phillip A. Dabill....... 10,000 1.30% 31.63 04/08/06 198,888 504,021 19,889 50,402
</TABLE>
Total potential realizable value for the named officers who received stock
option grants is $2,771,183 and $6,984,454 at the 5% and 10% stock price
growth assumptions respectively. Assuming 5% and 10% stock price growth over a
period of 10 years commencing April 1, 1996, the increase in total stockholder
value from stock price appreciation alone for all shares outstanding on that
date would be $1,313,790,049 and $3,399,802,689, respectively.
- --------
(1) The options are granted with a 10 year term. 20% of the options are
exercisable upon grant and an additional 20% become exercisable on each of
the next four anniversary dates of grant, except that all the options
become fully exercisable upon a Change of Control. Upon Mr. Anderson's
retirement, the options previously granted to him became fully exercisable
and the expiration date was fixed as indicated. (See "Separation
Agreements with Retired Officers" on page 12).
(2) The exercise price may be paid by delivery of already-owned shares, and
tax withholding obligations related to exercise may be paid by delivery of
already-owned shares or offset of the underlying shares. A "restoration"
option (also referred to as a "reload" option) is granted when an option
is exercised and payment of the exercise price is made by delivery of
SUPERVALU Common Stock. Each restoration option is granted for the number
of shares of Common Stock tendered as payment for the exercise price and
withheld for tax purposes, upon exercise of the original option. The
exercise price of each restoration option is the fair market value of
SUPERVALU Common Stock on the date of grant. Each restoration option is
exercisable in full on the date of grant, and will expire on the same date
as the original option. All options reported in the table are entitled to
restoration options. A limited stock appreciation right has been granted
in tandem with each option reported in the table, and is exercisable for
cash in lieu of the option only upon a Change of Control.
(3) These amounts are the result of calculations at the 5% and 10% rates set
by the Securities and Exchange Commission and therefore are not intended
to forecast possible future appreciation, if any, in the Company's stock
price.
(4) Computed by dividing potential realizable value at the assumed annual
rates of stock price appreciation by the term of the option.
10
<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTION/SAR VALUES
- -------------------------------------------------------------------------------
The following table provides information on option exercises in fiscal 1997 by
the named executive officers, and the value of such officers' unexercised
options/SARs at the end of the fiscal year.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED IN-THE-
OPTIONS/SARS AT FISCAL MONEY OPTIONS/SARS
SHARES YEAR-END(#) AT FISCAL YEAR-END($)
ACQUIRED ON VALUE ------------------------- --------------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ----------- ----------- ------------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Michael W. Wright....... 0 0 280,385 222,559 $ 1,206,113 $ 438,000
Laurence L. Anderson.... 0 0 157,155 30,000 312,294 97,500
Jeffrey Noddle.......... 0 0 107,890 75,502 339,631 174,385
Jeffrey C. Girard....... 0 0 92,550 57,950 323,535 143,625
David L. Boehnen........ 0 0 59,625 40,150 199,870 100,363
Phillip A. Dabill....... 7,475 $17,753 82,882 57,502 158,939 75,382
</TABLE>
PENSION PLANS
- -------------------------------------------------------------------------------
The following table shows estimated maximum annual benefits which would be
paid to an employee upon retirement at age 65 under the combination of the
Company's tax qualified defined benefit retirement plan, the Non-qualified
Supplemental Executive Retirement Plan (or, if applicable, the Excess Benefit
Plan) maintained for certain highly compensated employees, and the "Retirement
Benefit Plan Account" of the Company's deferred compensation plans. The table
does not reflect the $125,000 per year limitation on annual benefits payable
from the plans imposed by Section 415 of the Internal Revenue Code, nor the
$160,000 per year limitation on compensation included in final annual average
pay imposed by Section 401(a)(17) of the Internal Revenue Code. The Company's
Non-qualified Supplemental Executive Retirement Plan and Excess Benefits Plan
allow payment of additional benefits so that retiring employees may receive,
in the aggregate, the benefits they would have been entitled to receive if
such Sections did not impose maximum limitations.
<TABLE>
<CAPTION>
YEARS OF SERVICE(1)(2)
FINAL ANNUAL -----------------------------------
AVERAGE PAY (INCLUDING SALARY AND BONUS) 15 20 25 30
- ---------------------------------------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
$ 250,000................................ $ 55,875 $ 74,500 $ 93,125 $111,750
450,000................................ 103,875 138,500 173,125 207,750
650,000................................ 151,875 202,500 253,125 303,750
850,000................................ 199,875 266,500 333,125 399,750
1,350,000................................ 319,875 423,500 526,125 625,750
1,800,000................................ 427,875 567,500 705,125 841,750
</TABLE>
- --------
(1) The above estimates of annual benefits payable on normal retirement are
computed using the straight-life annuity method and are based on certain
assumptions, including (a) that the employee remains until the normal
retirement age of 65 (although retirement is permitted at age 62 without
benefit reduction because of age); and (b) that the present retirement
plans remain in force until the retirement date. Benefits under plans are
not reduced by the participant's Social Security benefit.
(2) If Mr. Wright retires as CEO of the Company after he reaches age 62,
instead of the benefits shown in the above table, he will be entitled to
receive annual payments calculated as 60% of his average (five highest
years) salary plus bonus offset by the sum of (i) the value of any
matching contributions to the Company's Pre-Tax Savings and Profit Sharing
(401(k)) Plan made through the date of retirement, (ii) any Company
additions to non-qualified deferred compensation accounts made through the
date of retirement, and (iii) one half of primary social security.
Assuming the plan is unchanged and Mr. Wright's employment continues until
age 62, based on current compensation and payment levels from other plans,
Mr. Wright would receive payments of $852,135 per year.
11
<PAGE>
As to each of the individuals named in the Summary Compensation Table on page
9, their final annual average pay and credited years of service under the
plans as of February 22, 1997, were as follows: Mr. Wright: $1,316,263, 20
years; Mr. Anderson: $610,257, 22.3 years; Mr. Noddle, $548,968, 20.8 years;
Mr. Girard: $542,505, 6.5 years; Mr. Boehnen, $320,573, 5.8 years; and Mr.
Dabill: $540,498, 34.6 years.
CHANGE IN CONTROL AGREEMENTS; SEPARATION AGREEMENTS WITH RETIRED OFFICERS
- -------------------------------------------------------------------------------
CHANGE IN CONTROL AGREEMENTS. The Company has entered into Severance
Agreements with officers of the Company, including those identified in the
Summary Compensation Table above. In general, these agreements entitle the
executive to a lump sum payment if the executive's employment is terminated
(other than for Cause or disability) within two years after a Change of
Control (as defined). The lump-sum cash payment is equal to a multiple of one,
two or three times the executive's annual base salary, plus average annual
bonus. The multiple is three for Mr. Wright; two for Mr. Girard, Mr. Noddle
and Mr. Boehnen; and one or two for all other officers of the Company. Each
executive would also receive a lump-sum retirement benefit equal to the
difference between (a) the actuarial equivalent of the benefit the executive
would receive under the Company's retirement plans if the executive remained
employed by the Company at the compensation level provided by the Severance
Agreement for a one, two or three year period following the date of
termination, and (b) the actuarial equivalent of the benefit to which the
individual is otherwise then entitled under the Company's retirement plans.
Generally, the executive would also be entitled to continued family medical
coverage for a one, two or three year period after the date of termination.
Mr. Wright's Severance Agreement provides for payment to be made if his
employment is terminated for any reason during the 30-day period starting six
months after the Change of Control. Due to the possible imposition of excise
taxes on the payments, the severance benefits payable to an executive would be
decreased if the result would give the executive a larger after-tax benefit.
Several of the Company's compensation and benefit plans contain provisions for
enhanced benefits on a Change of Control. They include stock options,
performance shares and restricted stock awards. Executive officers also hold
limited stock appreciation rights which become exercisable upon a Change of
Control, allowing the executive to receive cash for the bargain element in the
related stock option. The Company's Executive Deferred Compensation Plans
compensate the executive for any excise tax liability incurred following a
Change of Control. The Company's retirement plans provide for full vesting if
employment terminates under specified circumstances following a Change of
Control, and preserve any excess plan assets for the benefit of plan
participants for five years following a Change of Control.
The Company may set aside funds in an irrevocable grantor trust to satisfy its
obligations arising from certain of its benefit plans. Funds are set aside in
the trust automatically on a Change of Control. The trust assets would remain
subject to the claims of the Company's creditors.
SEPARATION AGREEMENTS WITH RETIRED OFFICERS. In October, 1996, Mr. Phillip
Dabill retired as Executive Vice President, after 34 years of service with
SUPERVALU. The Company and Mr. Dabill entered into an Agreement providing that
Mr. Dabill would continue to be employed for special projects designated by
the Chief Executive Officer during a one year transition period ending October
18, 1997. Mr. Dabill is entitled to receive his base salary and customary
benefits through October 19, 1997. Mr. Dabill has agreed to be available for
Company assignments for an average of two days per week. Mr. Dabill has
further agreed not to compete with the Company for a period of 24 months
following his final separation. The Summary Compensation Table on page 9 shows
Mr. Dabill's salary and other compensation paid or accrued during the most
recent fiscal year.
12
<PAGE>
Mr. Laurence Anderson retired as Executive Vice President, effective March 2,
1997, after 23 years of service with SUPERVALU. The Company and Mr. Anderson
entered into an agreement providing that he would complete certain projects
and continue to receive his base salary, bonus and customary benefits through
March 2, 1998. Other terms of the agreement provide that (i) Mr. Anderson's
stock options become fully exercisable with the exception of certain "price
vesting options" that will become exercisable only if the price of SUPERVALU's
Common Stock trades at $40 per share during the five year term of those
options, and (ii) shares of restricted stock previously granted to Mr.
Anderson become vested in fiscal 1998. As a condition to the receipt of
certain payments and benefits, Mr. Anderson has agreed not to compete with the
Company during the term of the agreement. The Summary Compensation Table on
page 9 shows Mr. Anderson's salary and other compensation paid or accrued
during the most recent fiscal year.
REPORT OF EXECUTIVE PERSONNEL AND COMPENSATION COMMITTEE
- -------------------------------------------------------------------------------
COMPENSATION PRINCIPLES
The Executive Personnel and Compensation Committee of the Board of Directors,
composed entirely of independent non-employee directors, has adopted a
comprehensive Executive Compensation Program based on the following
principles:
. The program will enable SUPERVALU to attract, retain, and motivate the key
executives necessary for current and long-term success.
. Compensation plans are designed to support SUPERVALU's long range business
strategy.
. Executive compensation is linked to corporate performance and attainment
of designated strategic objectives.
. A significant portion of executive gain is tied to the enhancement of
stockholder value.
. The Committee exercises independent judgment and approval authority with
respect to the executive compensation program and the awards made under
the program.
COMPENSATION METHODOLOGY
The structure of the Executive Compensation Program is based on a market
comparison of compensation for equivalent positions in industries from which
SUPERVALU draws executive talent as well as a position evaluation designed to
achieve internal equity based on job responsibility. The Company's primary
market comparison for compensation is the 10 companies comprising the peer
group for the performance graph on page 17 plus three additional non-grocery
distribution companies, all adjusted for size based primarily on market
capitalization (collectively, the "Compensation Peer Group"). The Company
engaged outside consulting firms to perform this market comparison in each of
the past five years. These market comparisons are the basis for designing the
Company's current compensation structure, which has a mix of fixed to variable
compensation and short-term to long-term incentive potential approximating the
mix within the Compensation Peer Group. The market comparisons were performed
in each year to ensure that the dollar values of the various plan components
as well as total compensation was comparable to that of the Compensation Peer
Group. In addition to a review of compensation plan design and compensation
levels, the Committee also reviews the Company's performance on a number of
key financial measures relative to the Compensation Peer Group plus selected
other industry companies.
The variable compensation components of the program are designed so that
executives' total compensation will be above that of the Compensation Peer
Group when SUPERVALU's performance is superior, and below that of the
Compensation Peer Group when performance is below industry norms. This
fluctuation in compensation value is increased by the substantial use of stock
in the program (as described in more detail in the remainder of this report),
so that total compensation will significantly increase or decrease in direct
relation to SUPERVALU's stock price.
13
<PAGE>
A summary follows which explains the major components of the Executive
Compensation Program, including factors and criteria upon which compensation
was awarded to the Chief Executive Officer for fiscal 1997.
ANNUAL COMPENSATION
BASE SALARIES. The base salary levels for executive officers are determined
based on three objectives:
. Internal equity based on job responsibility;
. Individual performance and experience; and
. Competitive salary levels with industries from which the Company draws
executive talent.
The Company's salary structure is based on the median salary levels of
companies in similar industries and size to SUPERVALU. Actual salaries may be
set above or below this median depending on individual job performance and
experience.
The Committee annually reviews and approves all salary increases for executive
officers other than the CEO. Increases for these executives are proposed by
the CEO based on performance evaluations which include both progress on
achievement of financial results and a qualitative assessment of performance.
The Chairman of the Committee conducts an annual performance evaluation of the
CEO based on written input from all Board members. The following factors are
considered in this performance evaluation: financial results, strategic
planning, leadership, customer service, succession planning, human resource
management/EEO, communications, external relations and Board interface. Salary
adjustments for the CEO are currently made every other year. In fiscal 1997,
Mr. Wright's base salary was increased from $780,000 to $819,000. This was the
first increase since March 1, 1994.
ANNUAL BONUSES. All of the Company's executive officers are eligible to
receive an annual cash bonus. The annual bonus plan is designed to motivate
executives to meet or exceed individual goals as well as corporate or profit
center financial goals which support SUPERVALU's business plans. These goals
are incorporated into annual performance measures for each executive.
Specifically, the annual bonus plan for executive officers is designed to
stimulate and reward growth in Company earnings. The Committee assigns target
bonus levels to each executive which are competitive with the Compensation
Peer Group. Among executive officers, these range from 20% of annual base
salary to 65% of annual base salary for the CEO. For officers other than the
CEO, ninety percent of this award potential is tied to corporate net profit
performance and the remaining ten percent is based on a subjective evaluation
of performance relative to personal objectives. The bonus award potential for
the CEO is tied solely to corporate net profit performance. Bonus payments
increase, as net profit growth meets and exceeds the annual growth rate
targeted by the Board. The maximum bonus is limited to twice the target bonus
level. Bonuses for the CEO and four other executive officers are paid from a
special plan structured so that the payment will be tax deductible as
"performance based compensation" under Internal Revenue Code Section 162(m).
LONG-TERM INCENTIVE COMPENSATION
The Company has implemented a Long-Term Incentive Plan and Stock Option Plans.
Together, these plans tie a significant portion of the executives' total
compensation to long term results. The long-term incentive potential is
intended to be competitive with programs offered by the Compensation Peer
Group.
LONG-TERM INCENTIVE PLAN. The Committee selects Plan participants, approves
awards and interprets and administers the Long-Term Incentive Plan. In fiscal
1995, the Committee made awards of "performance shares" to executive officers
and division presidents which covered the three-year period from fiscal 1995
through fiscal 1997. The awards were set at levels which were expected to be
competitive with long-term compensation offered by the
14
<PAGE>
Compensation Peer Group. For corporate officers, half of any award was earned
if annual return on invested capital objectives were met. The other half of
the award would be earned if the Company's total stockholder return
performance for the entire three year period equaled the seventy-fifth
percentile of total stockholder return of the group of companies comprising
the performance graph peer group on page 17. Award value was tied to both
corporate Return on Invested Capital ("ROIC") performance and total
shareholder return (which determines the number of shares earned) and stock
price (which determines the value of the shares earned). The awards provided
that, if earned, performance shares would be converted to restricted stock
that would vest after one to two years of further employment. Executives who
receive restricted stock are motivated to remain with the Company and focus on
stockholder value after the award has actually been earned.
The Committee determined minimum, target and maximum payout amounts for each
participant based on each fiscal year's corporate ROIC performance for
officers, and corporate ROIC and division return on capital employed ("ROCE")
performance for key profit center executives. Application of the criteria set
forth in the awards for fiscal 1997 resulted in key profit center executives
earning an aggregate of 16,149 shares of restricted stock based on the
performance of the operations they managed. No awards were earned by any other
executives.
Stock Option Plans. The Committee believes that executive gain tied to stock
price appreciation is the most effective way of aligning executive and
stockholder interests. Two key programs together cause executives to view
themselves as owners of a meaningful equity stake in the business over the
long term. They are:
. The executive stock option program; and
. Stock ownership targets for executive officers.
Annual Option Grants. The Committee makes annual grants of stock options to
key employees under established grant guidelines intended to be competitive
with the Compensation Peer Group. The Committee also considers subjective
factors in determining grant size; grants are not automatically tied to a
formula or the optionee's position in the Company. Corporate, division or
individual performance will impact the size of an optionee's grant. In
addition, current ownership of stock is a consideration in the size of option
grants for officers and division presidents. Based on the stock grant
guidelines and the subjective factors described above, annual grant
recommendations are developed by management, reviewed by the Chief Executive
Officer, and presented to the Committee for final approval.
The Board awarded Mr. Wright stock options for 80,000 shares in fiscal 1997
which were based on the criteria described above and his performance as
reviewed by the Board.
Stock options are granted with an exercise price equal to the market price of
the Company's stock on the date of grant. In order to encourage option
exercise and share ownership, SUPERVALU also permits executives to exercise
options using shares of SUPERVALU stock to pay the exercise price. Upon such
exercise, SUPERVALU grants the executive a restoration stock option (commonly
referred to as a reload option) for that number of shares surrendered. Reload
options are exercisable at the then current market price and extend for the
remainder of the original option's term.
Price Vesting Options. In June of 1995, the Committee approved a special grant
of stock options to officers and select key operation heads. These options
were granted at the then current market price, and were in addition to normal
annual grants. However, these options only become exercisable if the executive
remains employed for at least two years after grant and the price of SUPERVALU
stock averages $40 or more for twenty consecutive trading days during the five
year term of the options. If this price target is not met within five years,
the options will expire. The objective of this special grant was to focus top
management on increasing the price of SUPERVALU stock during a critical period
of transformation in business operations. No additional price vesting shares
were granted in fiscal year 1997.
15
<PAGE>
STOCK OWNERSHIP GUIDELINES
Stock ownership guidelines for executive officers have been established so
that they face the same downside risk, and upside potential, as stockholders
experience. Executives are expected to show significant progress toward
reaching these ownership goals. The goal for the Chief Executive Officer is
six times annual base salary, excluding vested and unexercised stock options.
POLICY REGARDING APPLICABLE TAX CODE
PROVISION
Section 162(m) of the Internal Revenue Code imposes limits on tax deductions
for executive compensation in excess of $1 million paid to any of the top five
executive officers named in the Summary Compensation Table unless certain
conditions are met. The Committee makes every reasonable effort to preserve
this tax deduction consistent with the principles of the Executive
Compensation Program.
CONCLUSION
The Committee believes that the caliber and motivation of executive management
is fundamentally important to the Company's performance. The Committee plays a
very active role in ensuring that SUPERVALU's compensation plans implement its
key compensation principles. Independent compensation consultants have
assisted the Committee in designing these plans, assessing the effectiveness
of the overall program, and keeping overall compensation competitive with that
of relevant peer companies. Total compensation is intended to be above
industry averages when performance is superior, and below competitive levels
when performance is below expected levels or SUPERVALU stock fails to
appreciate. The Committee believes that the Executive Compensation Program has
been a substantial contributor toward motivating executives to focus on the
creation of stockholder value.
Respectfully submitted,
Edwin C. Gage, Chairman
Herman Cain
Lawrence A. Del Santo
William A. Hodder
Richard L. Knowlton
Carole F. St. Mark
Winston R. Wallin
16
<PAGE>
PERFORMANCE GRAPH
- -------------------------------------------------------------------------------
The following graph compares the cumulative total stockholder return on
SUPERVALU's Common Stock for the last five fiscal years with that of the S&P
500 Stock Index and a group of peer companies in the wholesale and retail
grocery industries. The graph assumes the investment of $100 in each company
on February 28, 1992, and the reinvestment of all dividends on a quarterly
basis. The stock price performance shown on the graph below is not a
projection of future price performance.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
SUPERVALU INC., S&P 500 STOCK INDEX AND COMPOSITE PEER GROUP(1)
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
1992 1993 1994 1995 1996 1997
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
SUPERVALU....................... $100.00 $127.95 $150.40 $108.22 $139.89 $139.00
S&P 500......................... 100.00 110.59 119.73 128.48 172.84 217.92
Peer Group...................... 100.00 112.60 102.99 94.17 119.43 134.72
</TABLE>
- --------
(1) The composite peer group is comprised of the following food wholesalers
and food retailers: Albertson's, Inc., American Stores Company, Fleming
Companies, Inc., Food Lion, Inc., Great Atlantic & Pacific Tea Company,
The Kroger Company, Nash Finch Company, Richfood Holdings Inc., Safeway
Inc., and The Vons Companies, Inc. Super Food Services, Inc., formerly
included in the composite peer group, was acquired by Nash Finch Company
during the fiscal year. The returns of the peer group companies were
weighted based on their respective market capitalization and on the
relative percentage of SUPERVALU's operating profit realized from
wholesale and retail food operations (excluding fiscal 1995 restructuring
charges) for each year. The performance graph indicates results calculated
to the last business day in February each year.
17
<PAGE>
PROPOSAL TO RATIFY THE APPOINTMENT OF INDEPENDENT AUDITORS
(ITEM 2)
- -------------------------------------------------------------------------------
The Board of Directors, upon recommendation of its Audit Committee, has
appointed Deloitte & Touche LLP to audit the books and accounts of the Company
and its subsidiaries for the fiscal year ending February 27, 1998, and is
seeking the ratification of this appointment by the stockholders. A partner of
Deloitte & Touche LLP will be present at the Annual Meeting with the
opportunity to make a statement and to respond to questions.
BACKGROUND INFORMATION (ITEMS 3, 4, AND 5)
- -------------------------------------------------------------------------------
The Board of Directors recommends that the stockholders approve amendments to
the 1993 Stock Plan, the 1983 Employee Stock Option Plan, and the Long-Term
Incentive Plan. All of these Plans have previously been approved by the
stockholders. The sole purpose of the amendments is to qualify stock options
and certain other awards under the Plans as "performance based" compensation
for purposes of Section 162(m) of the Internal Revenue Code.
Section 162(m) created a new limitation on deductibility of compensation paid
to the Chief Executive Officer and the four other executive officers required
to be named in the Summary Compensation Table in the proxy statement each
year. If annual compensation paid to any of these executive officers exceeds
$1 million it must qualify as "performance based" in order to be deductible by
the Company for federal income tax purposes. In order for an award to be
considered "performance based" the stockholders must approve a maximum
limitation on the number of shares as to which options or other awards may be
granted and must approve the criteria under which awards, other than stock
options, will be made. The proposed amendments to the Plans are described in
more detail below.
The closing price of SUPERVALU Common Stock on April 1, 1997, as reported on
the New York Stock Exchange, was $29.75 per share.
The following table sets forth the number of shares of SUPERVALU Common Stock
covered by options or other awards granted under the Plans during the 1997
fiscal year. Awards to the most highly compensated executive officers are set
forth in the Summary Compensation Table on Page 9.
<TABLE>
<CAPTION>
1983 EMPLOYEE LONG-
1993 STOCK PLAN STOCK OPTION PLAN TERM INCENTIVE PLAN
--------------- ----------------- -----------------------
NO. OF SHARES NO. OF SHARES
UNDERLYING UNDERLYING NO. OF
OPTIONS OPTIONS DOLLAR VALUE ($) SHARES
--------------- ----------------- ---------------- ------
<S> <C> <C> <C> <C>
All current Executive
Officers as a Group.... 227,140 0 $110,313 3,708
All current Non-Employee
Directors as a Group... 0 36,000 0 0
All Employees as a Group
(excluding Executive
Officers).............. 503,435 0 500,484 16,823
</TABLE>
18
<PAGE>
PROPOSAL TO APPROVE AN AMENDMENT TO THE SUPERVALU INC. 1993 STOCK PLAN (ITEM
3)
- -------------------------------------------------------------------------------
PROPOSED AMENDMENT. The Board of Directors recommends that the stockholders
approve an amendment to the 1993 Plan. The Amendment limits annual grants of
stock options and stock appreciation rights to any participant to a maximum of
250,000 shares, taking into account all SUPERVALU option plans in which the
employee participates. The sole purpose of the Amendment is to qualify options
granted under the Plan as "performance based" compensation for purposes of
Internal Revenue Code Section 162(m).
SUMMARY OF 1993 PLAN. A copy of the 1993 Plan is attached as Exhibit A to this
Proxy Statement. This discussion is only a summary. You should refer to the
1993 Plan for more complete information.
PURPOSE. The purpose of the 1993 Plan is to promote the interests of the
Company and its stockholders by attracting and retaining key management
employees, by stimulating the efforts of the participants to contribute to the
current and long-term success of the Company, and by providing an opportunity
for participants to increase their SUPERVALU stock ownership.
ADMINISTRATION. The 1993 Plan is administered by the Executive Personnel and
Compensation Committee. The Committee has the authority to select the
individuals to whom awards are granted, to determine the types of awards and
the number of shares of Common Stock covered by awards and to set the terms
and conditions of awards. The Committee has the authority to establish rules
for the administration of the 1993 Plan, and its determinations and
interpretations are binding. The Committee may delegate its authority to one
or more officers.
ELIGIBLE PARTICIPANTS. Any employee, officer, consultant, or independent
contractor of the Company and its affiliates selected by the Committee is
eligible to receive awards under the 1993 Plan. The Committee limits
eligibility to the key management group, defined by level of job
responsibility. There were approximately 600 persons as of April 1, 1997 who
were eligible as a class to receive awards under the 1993 Plan.
TYPES OF AWARDS. The 1993 Plan permits the grant of a variety of different
types of awards:
. Stock options, including incentive stock options ("ISOs") meeting the
requirements of Section 422 of the Internal Revenue Code, stock options
that are not ISOs ("Nonqualified Stock Options") and restoration options;
. Stock appreciation rights ("SARs");
. Restricted stock;
. Stock units;
. Performance awards; and
. Other awards valued in whole or in part by reference to or based on
SUPERVALU's stock.
The following types of awards have been made under the 1993 Plan:
. Stock options (which include limited SARs for officers); and
. Restricted stock.
Awards may be granted for any amount of cash consideration or for no cash
consideration so long as legal requirements are met. The exercise price per
share under any stock option and the grant price of any SAR may not be less
than 100% of the fair market value of the Company's Common Stock on the date
of the grant of such option or SAR.
STOCK OPTIONS. Options may be exercised by payment of the exercise price,
either in cash or, at the discretion of the Committee, by using shares of
Common Stock or other consideration having a fair market value equal to the
exercise price. The Committee may grant restoration options with terms and
conditions established by the Committee. Restoration options are granted when
a participant pays the exercise price of the option by using previously owned
shares of Common Stock. The new option would be for that number of shares
surrendered.
19
<PAGE>
STOCK APPRECIATION RIGHTS. The holder of an SAR is entitled to receive the
excess of the fair market value of a specified number of shares over the grant
price of the SAR.
RESTRICTED STOCK. Shares of restricted stock and restricted stock units may be
awarded subject to such restrictions and other terms and conditions as the
Committee may impose. Restricted stock may not be transferred by the holder
until the restrictions established by the Committee lapse. Holders of
restricted stock units would have the right to receive shares of Common Stock
at some future date.
OTHER AWARDS. Performance awards provide the right to receive awards upon the
achievement of the goals established by the Committee. A performance award
granted under the 1993 Plan may be denominated or payable in cash, shares of
Common Stock or restricted stock, or other securities, or property.
MAXIMUM NUMBER OF SHARES. Up to 3,500,000 shares of the Company's Common Stock
may be issued as awards under the 1993 Plan (subject to certain adjustments).
If any shares to which an award relates are forfeited, or if an award is
otherwise terminated then the number of shares with respect to such award, to
the extent of any such forfeiture or termination, will again be available for
grant under the 1993 Plan. As of April 1, 1997, 39,936 shares had been issued,
2,790,744 shares were subject to outstanding options, and 669,320 shares were
available for future grants. As of April 1, 1997, approximately 561 optionees
held options under the 1993 Plan.
ADJUSTMENTS. The Committee may make adjustments to awards under the 1993 Plan
in order to prevent dilution or enlargement of the benefits or potential
benefits intended to be made available if any corporate transaction or event
affects the shares of Common Stock so that an adjustment is appropriate.
TERM. The 1993 Plan terminates on April 13, 2003, and no awards may be made
after that date.
AMENDMENTS. The Board of Directors may amend, alter or discontinue the 1993
Plan at any time, provided that stockholder approval must be obtained in
certain events.
FEDERAL INCOME TAX CONSEQUENCES. The following is a summary of the principal
federal income tax consequences generally applicable to options and SARs under
the 1993 Plan.
The grant of an option or SAR is not expected to result in any taxable income
for the recipient. The holder of an ISO generally will have no taxable income
upon exercising the ISO (except that a liability may arise for alternative
minimum tax), and the Company will not be entitled to a tax deduction when an
ISO is exercised. When a participant exercises a Nonqualified Stock Option,
the optionee must recognize ordinary income equal to the difference between
the fair market value of the shares acquired and the exercise price, and the
Company will be entitled to a tax deduction for the same amount. Upon
exercising an SAR, the amount of any cash received and the fair market value
on the exercise date of any Common Stock received are taxable to the recipient
as ordinary income and deductible by the Company. The tax consequences to a
participant upon a disposition of shares acquired through the exercise of an
option or SAR will depend on how long the shares have been held and upon
whether such shares were acquired by exercising an ISO or by exercising a
Nonqualified Stock Option or SAR. If shares acquired on the exercise of an ISO
are held for at least one year after exercise and two years from the date the
ISO was granted, the optionee will recognize long-term capital gain or loss in
an amount equal to the difference between the option price for the shares and
the sale price. Generally, there will be no tax consequence to the Company in
connection with the disposition of shares acquired under an option, except
that the Company may be entitled to a tax deduction in the case of a
disposition of ISO shares before the applicable ISO holding periods have been
satisfied.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE PROPOSAL TO AMEND THE 1993
STOCK PLAN.
20
<PAGE>
APPROVAL OF AN AMENDMENT TO THE SUPERVALU INC. 1983 EMPLOYEE STOCK OPTION PLAN
(ITEM 4)
- -------------------------------------------------------------------------------
PROPOSED AMENDMENT. The Board of Directors recommends that the stockholders
approve an amendment to the 1983 Plan. The Amendment limits annual grants of
stock options and stock appreciation rights to any participant to a maximum of
250,000 shares, taking into account all SUPERVALU option plans in which the
employee participates. The sole purpose of the Amendment is to qualify options
and stock appreciation rights granted under the Plan as "performance based"
compensation for purposes of Internal Revenue Code Section 162(m).
SUMMARY OF 1983 PLAN. A copy of the 1983 Plan is attached as Exhibit B to this
Proxy Statement. This discussion is only a summary. You should refer to the
1983 Plan for more complete information.
PURPOSE. The purpose of the 1983 Plan is to promote the interests of the
Company and its stockholders by encouraging key salaried executives and non-
employee members of the Board of Directors to invest in shares of SUPERVALU
Common Stock. The stock option program is intended to result in participants
demonstrating increased personal interest and effort in the continued success
of the business. It also provides a means of attracting and retaining key
personnel and directors.
ADMINISTRATION. The 1983 Plan is administered by the Executive Personnel and
Compensation Committee.
ELIGIBLE PARTICIPANTS. Options may be granted only to key salaried, management
employees of the Company or any subsidiary and to non- employee directors.
There were approximately 600 persons as of April 1, 1997 who were eligible as
a class to receive awards under the 1983 Plan.
TYPES OF AWARDS. The 1983 Plan provides for the award of stock options. Except
with respect to non-employee director options, the Committee determines at the
time of grant whether the option is to be an ISO or a Nonqualified Stock
Option, the number of shares subject to the option, and the term of the
option. No option can have a term in excess of ten years from the date of
grant. Options may be exercisable in installments or otherwise, as the
Committee may determine for each grant. All options become fully exercisable
upon a Change of Control. Options granted to non-employee directors are fully
exercisable at the time of grant.
The Committee may grant restoration options to any optionee (other than a non-
employee director), with terms and conditions established by the Committee.
Restoration options are granted when a participant pays the exercise price of
an option by using previously owned shares of Common Stock. The new option
would be for that number of shares surrendered.
MAXIMUM NUMBER OF SHARES. Up to 4,500,000 shares of the Company's Common Stock
may be issued under all options granted pursuant to the 1983 Plan. If any
shares to which an award relates are forfeited, or if an award is otherwise
terminated then the number of shares with respect to such award, to the extent
of any such forfeiture or termination, will again be available for grant under
the 1983 Plan. As of April 1, 1997, 1,881,718 shares had been issued,
2,147,150 shares were subject to outstanding options, and 471,132 shares were
available for future grants. As of April 1, 1997, approximately 334 optionees
held options under the 1983 Plan.
ADJUSTMENTS. The Committee may make adjustments to the number and class of
shares, the exercise price under outstanding options, and other adjustments in
order to prevent dilution or enlargement of potential benefits intended to be
made available, if any corporate transaction or event affects the shares of
Common Stock so that an adjustment is appropriate.
AMENDMENTS. The Board of Directors may terminate or amend the 1983 Plan
provided that stockholder approval must be obtained in certain events. The
Board of Directors may not amend
21
<PAGE>
the provisions governing the grant of options to non-employee directors more
than once every six months other than to comport with changes in the Internal
Revenue Code, the Employee Retirement Income Security Act or the rules and
regulations thereunder.
TERM. The 1983 Plan terminates on February 7, 1999, and no options can be
granted after that date.
FEDERAL INCOME TAX CONSEQUENCES. See discussion on Federal Income Tax
Consequences under Item 3 above.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE PROPOSAL TO AMEND THE 1983
EMPLOYEE STOCK OPTION PLAN.
PROPOSAL TO APPROVE AN AMENDMENT TO THE SUPERVALU INC. LONG-
TERM INCENTIVE PLAN (ITEM 5)
- -------------------------------------------------------------------------------
PROPOSED AMENDMENT. The Board of Directors recommends that the stockholders
approve an amendment to the Incentive Plan. The amendment imposes an annual
limit on the number of shares of Common Stock that can be awarded to any
participant and establishes the business criteria that will be used as
performance measures in making awards. The sole purpose of the Amendment is to
qualify awards under the Incentive Plan as "performance based" compensation
under Section 162(m) of the Internal Revenue Code.
SUMMARY OF INCENTIVE PLAN. A copy of the Incentive Plan is attached as Exhibit
C to this Proxy Statement. This discussion is only a summary. You should refer
to the Incentive Plan itself for more complete information.
PURPOSE. The purpose of the Incentive Plan is to attract and retain key
employees and to stimulate the efforts of participants to contribute to the
long-term success of the Company.
ADMINISTRATION. The Incentive Plan is administered by the Executive Personnel
and Compensation Committee which determines the executives to be granted award
opportunities. The Committee determines the awards to be made, including the
amount of each award, the times when awards will be made, the period of time
over which the awards are intended to be earned and all other terms and
conditions of each award.
ELIGIBLE PARTICIPANTS. Awards may be granted only to a select group of
management and key employees. As of April 1, 1997, there were approximately 50
persons eligible to receive awards under the Incentive Plan.
TYPES OF AWARDS. The Incentive Plan permits the Committee to grant a variety
of different types of awards:
. Shares of Common Stock;
. Restricted stock;
. Stock units;
. Performance awards; and
. Other awards valued in whole or in part by reference to or based on
SUPERVALU stock.
The right to receive payment of an award is determined solely based upon the
key employee attaining one or more pre-established, objective performance
goals for a performance period selected by the Committee at the time of the
grant.
MAXIMUM NUMBER OF SHARES. The maximum number of shares or Stock Units with
respect to which awards may be granted under the Incentive Plan is 750,000
shares of Common Stock. If any shares to which an award relates are forfeited,
or if an award is otherwise terminated then the number of shares with respect
to such award, to the extent of any such forfeiture or termination, will again
be available for grant under the Incentive Plan. As of April 1, 1997, 261,166
shares had been issued and 488,834 shares were available for future grants.
The maximum number of shares of SUPERVALU Common Stock that may be issued to
any key employee pursuant to any performance-based award under the Incentive
Plan in any calendar year will not exceed 50,000 shares.
22
<PAGE>
ADJUSTMENTS. The Committee may adjust the number and class of shares (or other
securities or other property) issuable under the Incentive Plan and under any
outstanding award, in order to prevent dilution or enlargement of the benefits
or potential benefits intended to be made available if any corporate
transaction or event affects the shares of Common Stock so that an adjustment
is appropriate.
AMENDMENTS. The Committee may amend, suspend or terminate the Incentive Plan
at any time, except that stockholder approval must be obtained in certain
events.
TERM. The Incentive Plan will expire on February 11, 2002, and no awards can
be granted after that date.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ABOVE PROPOSAL TO AMEND THE
LONG-TERM INCENTIVE PLAN.
STOCKHOLDER PROPOSAL (ITEM 6)
- -------------------------------------------------------------------------------
A stockholder (name and address and Common Stock holdings of the stockholder
will be supplied upon oral or written request to SUPERVALU's Corporate
Secretary) has submitted the following proposal for action at the Annual
Meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "AGAINST" THIS PROPOSAL.
STOCKHOLDER PROPOSAL
RESOLVED: That the stockholders of SUPERVALU INC. ("SUPERVALU" or the
"Company") request the Board of Directors to redeem the preferred share
purchase rights issued in 1989 unless such issuance is approved by the
affirmative vote of a majority of the outstanding shares at a meeting of the
stockholders to be held as soon as may be practicable.
SUPPORTING STATEMENT. On April 12, 1989, the SUPERVALU Board of Directors
declared, without stockholder approval, a dividend of preferred share purchase
rights ("rights"). We strongly believe that such rights are a type of anti-
takeover device, commonly known as a poison pill, which injures stockholders
by reducing management accountability and adversely affecting stockholder
value. We believe the terms of the rights plan are designed to discourage or
thwart an unwanted takeover of the Company. While management and the Board of
Directors should have appropriate tools to ensure that all shareholders
benefit from any proposal to acquire the Company, we do not believe that the
future possibility of a takeover justifies the unilateral imposition of such a
poison pill.
Rather, we believe that the shareholders should, at a minimum, have the right
to vote on the necessity of such a powerful tool, which could be used to
entrench existing management and can have an adverse impact on shareholder
value.
Rights plans such as the Company's have become increasingly unpopular in
recent years. Also, the negative effects of poison pill rights plans on the
trading value of companies' stock have been the subject to extensive research.
A 1986 study (covering 245 companies adopting poison pills between 1983 and
July 1986) was prepared by the Office of the Chief Economist of the U.S.
Securities and Exchange Commission on the effect of poison pills on the wealth
of target shareholders. It states that "empirical tests, taken together, show
that poison pills are harmful to target shareholders, on net." A 1992 study of
Professor John Pound of Harvard's Corporate Research Project and Lilli A.
Gordon of the Gordon Group found a correlation between high corporate
performance and the absence of poison pills.
At the 1996 annual meeting 64% of the voting shares were cast in favor of this
proposal, which also received 60% of the voting shares in 1994 and 1995. We
therefore resubmit this stockholder proposal based on our continuing belief
that SUPERVALU's unilateral adoption of
23
<PAGE>
the rights plan was unjustified and that the continued existence of such a
rights plan is not in the best interest of the stockholders.
WE URGE YOU TO VOTE FOR THIS RESOLUTION!
SUPERVALU'S STATEMENT IN OPPOSITION TO PROPOSAL
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "AGAINST" THIS PROPOSAL
FOR THE FOLLOWING REASONS:
The Preferred Share Purchase Rights Plan (the "Rights Plan") was adopted by
the Board of Directors in 1989 to protect the Company's stockholders against
certain abusive takeover practices prevalent in the marketplace and to ensure
that all stockholders are treated fairly and equally. The overriding objective
of the Board of Directors in adopting the Rights Plan was, and continues to
be, the preservation and maximization of the Company's value for all
stockholders.
The Board believes that the Rights Plan is a sound and reasonable means of
protecting against unfair and abusive takeover practices and is both
appropriately within its discretion and an essential exercise of its fiduciary
obligations to the stockholders. The Board also believes that many
stockholders have come to recognize the effectiveness of these plans in
protecting and enhancing value for all stockholders.
The Rights Plan does not preclude a prospective bidder from making an offer
for the Company. Moreover, the Rights Plan is not intended to prevent a
takeover of the Company nor would it do so. The Rights Plan is intended to
give the Board sufficient time, if presented with an offer to acquire the
Company, to evaluate the offer and any possible alternatives and to take those
steps that the Board believes would be necessary to maximize the value that
can be achieved for all stockholders.
The Rights Plan is designed to encourage any prospective bidder for the
Company to negotiate with the Company's Board. The Board believes that its
ability to negotiate effectively with a potential acquiror on behalf of all
stockholders is significantly greater than that of the stockholders
individually. A bidder who chooses to bypass the Board is pursuing his own
interest and is not concerned with the interests of the other stockholders. In
this regard, it is important to remember that hostile acquirors are interested
in buying a company as cheaply as they can. Without the Rights Plan, the
Company could find itself negotiating with the acquiror from a defensive
posture rather than at arm's-length. While a bidder may make an offer for the
Company's stock which is in excess of the stock's current market price,
without such negotiations the premium offered may not reflect the long-term
value of the Company.
The Board strongly disagrees with the view that rights plans deter legitimate
acquisition proposals from being made or depress the price of the stock of
corporations adopting them. Since 1986, at least 52 companies which had rights
plans have been acquired or were parties to agreements to be acquired,
including 37 companies which were acquired after receiving an unsolicited bid.
Furthermore, in 31 of the 37 acquisitions of companies with rights plans that
were initiated by unsolicited bids, the prices ultimately received by
stockholders exceeded the initial bids and did so by an average premium to the
initial bid of more than 20%.(1)
Studies by Georgeson & Company, Inc., a leading investor communications firm,
have concluded that "[rights plans] do not prevent takeovers nor do they
diminish the value of a company's stock." These studies also indicated that
"companies with [rights plans] receive premiums 69% higher in takeover
contests than companies without [rights plans]."
(1) Based on data obtained from Securities Data Corporation and other industry
sources.
FOR THE FOREGOING REASONS, THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A
VOTE "AGAINST" THIS PROPOSAL.
24
<PAGE>
OTHER INFORMATION
- -------------------------------------------------------------------------------
SUPERVALU MAILING ADDRESS
The Company's mailing address is: P.O. Box 990, Minneapolis, MN 55440.
STOCKHOLDERS PROPOSALS FOR 1998 ANNUAL MEETING
All proposals of stockholders must be received by the Corporate Secretary on
or before January 24, 1998, to be included in the proxy statement for the 1998
Annual Meeting.
DIRECTOR NOMINATIONS
In accordance with procedures set forth in the Company's Bylaws, Stockholders
may propose nominees for election to the Board of Directors by timely written
notice to the Corporate Secretary, generally no less than sixty days and no
more than ninety days prior to the first anniversary date of the last annual
meeting.
EXPENSES OF SOLICITATION
This solicitation of proxies is being made by SUPERVALU and it pays the cost
of soliciting proxies. The Company arranges with brokerage houses, custodians,
nominees and other fiduciaries to send proxy material to their principals, and
the Company reimburses them for their expenses. In addition to solicitation by
mail, proxies may be solicited by SUPERVALU employees, by telephone or
personally. No additional compensation would be paid for such employee
solicitation. The Company has also retained Georgeson & Company, Inc. to
assist in the solicitation of proxies for an estimated fee of $11,000 plus
out-of-pocket expenses.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
As indicated above, Edwin C. Gage (Chairman), Lawrence A. Del Santo, Herman
Cain, William A. Hodder, Richard L. Knowlton, Carole F. St. Mark, and Winston
R. Wallin served as members of the Executive Personnel and Compensation
Committee during fiscal 1997. The members of the Committee do not participate
in any interlocking directorships. Mr. Gage and certain family members, as
trustees for revocable trusts, are general partners, among others, of Carlson
Real Estate Company, a limited partnership which leases a retail supermarket
in Shakopee, Minnesota, to the Company for a term ending in 2008, with options
to renew. The annual rental is $199,000, increasing to $224,000 in 1998 and
$232,000 in 2003, which the Company believes to be a fair market rental. The
leased premises are subleased to an independent retail supermarket operator.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The rules of the Securities and Exchange Commission require the Company's
directors, executive officers, and holders of more than 10% of the Company's
Common Stock to file reports of stock ownership and changes in ownership. To
the best of the Company's knowledge, there were no late or inaccurate filings
in fiscal 1997, except that a Form 5 for Mr. Noddle reporting an annual stock
option grant was filed late. In making this statement, the Company has relied
upon written representations of its directors and executive officers.
25
<PAGE>
EXHIBIT A
SUPERVALU INC.
1993 STOCK PLAN
SECTION 1. PURPOSE
The purpose of the Plan is to promote the interests of the Company and its
stockholders by aiding the Company in attracting and retaining key management
personnel capable of assuring the future success of the Company, to offer such
personnel incentives to put forth maximum efforts for the success of the
Company's business and to afford such personnel an opportunity to acquire a
proprietary interest in the Company.
SECTION 2. DEFINITIONS
As used in the Plan, the following terms shall have the meanings set forth
below:
(a) "Affiliate" shall mean (i) any entity that, directly or indirectly
through one or more intermediaries, is controlled by the Company and (ii)
any entity in which the Company has a significant equity interest, in each
case as determined by the Committee.
(b) "Award" shall mean any Option, Stock Appreciation Right, Restricted
Stock, Restricted Stock Unit, Performance Award, or Other Stock-Based Award
granted under the Plan.
(c) "Award Agreement" shall mean any written agreement, contract or other
instrument or document evidencing any Award granted under the Plan.
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and any regulations promulgated thereunder.
(e) "Committee" shall mean a committee of the Board of Directors of the
Company designated by such Board to administer the Plan, which shall
consist of members appointed from time to time by the Board of Directors
and shall be comprised of not less than such number of directors as shall
be required to permit the Plan to satisfy the requirements of Rule 16b-3.
Each member of the Committee shall be a "disinterested person" within the
meaning of Rule 16b-3.
(f) "Company" shall mean SUPERVALU INC., a Delaware corporation, and any
successor corporation.
(g) "Eligible Person" shall mean any employee, officer, consultant or
independent contractor providing services to the Company or any Affiliate
who the Committee determines to be an Eligible Person. A director of the
Company who is not also an employee of the Company or an Affiliate shall
not be an Eligible Person.
(h) "Fair Market Value" shall mean, with respect to any property
(including, without limitation, any Shares or other securities), the fair
market value of such property determined by such methods or procedures as
shall be established from time to time by the Committee. Notwithstanding
the foregoing, unless otherwise determined by the Committee, the Fair
Market Value of Shares on a given date for purposes of the Plan shall be
the average of the opening and closing sale price of the Shares as reported
on the New York Stock Exchange on such date or, if such Exchange is not
open for trading on such date, on the day closest to such date when such
Exchange is open for trading.
(i) "Incentive Stock Option" shall mean an option granted under Section
6(a) of the Plan that is intended to meet the requirements of Section 422
of the Code or any successor provision.
(j) "Non-Qualified Stock Option" shall mean an option granted under
Section 6(a) of the Plan that is not intended to be an Incentive Stock
Option.
A-1
<PAGE>
(k) "Option" shall mean an Incentive Stock Option or a Non-Qualified
Stock Option, and shall include Restoration Options.
(l) "Other Stock-Based Award" shall mean any right granted under Section
6(f) of the Plan.
(m) "Participant" shall mean an Eligible Person designated to be granted
an Award under the Plan.
(n) "Performance Award" shall mean any right granted under Section 6(d)
of the Plan.
(o) "Person" shall mean any individual, corporation, partnership,
association or trust.
(p) "Plan" shall mean this 1993 Stock Plan, as amended from time to time.
(q) "Restoration Option" shall mean any Option granted under Section
6(a)(iv) of the Plan.
(r) "Restricted Stock" shall mean any Share granted under Section 6(c) of
the Plan.
(s) "Restricted Stock Unit" shall mean any unit granted under Section
6(c) of the Plan evidencing the right to receive a Share (or a cash payment
equal to the Fair Market Value of a Share) at some future date.
(t) "Rule 16b-3" shall mean Rule 16b-3 promulgated by the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as amended,
or any successor rule or regulation.
(u) "Shares" shall mean shares of Common Stock, $1.00 par value, of the
Company or such other securities or property as may become subject to
Awards pursuant to an adjustment made under Section 4(c) of the Plan.
(v) "Stock Appreciation Right" shall mean any right granted under Section
6(b) of the Plan.
SECTION 3. ADMINISTRATION
(a) Power and Authority of the Committee. The Plan shall be administered by
the Committee. Subject to the express provisions of the Plan and to applicable
law, the Committee shall have full power and authority to: (i) designate
Participants; (ii) determine the type or types of Awards to be granted to each
Participant under the Plan; (iii) determine the number of Shares to be covered
by (or with respect to which payments, rights or other matters are to be
calculated in connection with) each Award; (iv) determine the terms and
conditions of any Award or Award Agreement; (v) amend the terms and conditions
of any Award or Award Agreement and accelerate the exercisability of Options
or the lapse of restrictions relating to Restricted Stock, Restricted Stock
Units or other Awards; (vi) determine whether, to what extent and under what
circumstances Awards may be exercised in cash, Shares, other securities, other
Awards or other property, or canceled, forfeited or suspended; (vii) determine
whether, to what extent and under what circumstances cash, Shares, other
securities, other Awards, other property and other amounts payable with
respect to an Award under the Plan shall be deferred either automatically or
at the election of the holder thereof or the Committee; (viii) interpret and
administer the Plan and any instrument or agreement relating to, or Award made
under, the Plan; (ix) establish, amend, suspend or waive such rules and
regulations and appoint such agents as it shall deem appropriate for the
proper administration of the Plan; and (x) make any other determination and
take any other action that the Committee deems necessary or desirable for the
administration of the Plan. Unless otherwise expressly provided in the Plan,
all designations, determinations, interpretations and other decisions under or
with respect to the Plan or any Award shall be within the sole discretion of
the Committee, may be made at any time and shall be final, conclusive and
binding upon any Participant, any holder or beneficiary of any Award and any
employee of the Company or any Affiliate.
(b) Delegation. The Committee may delegate its powers and duties under the
Plan to one or more officers of the Company or any Affiliate or a committee of
such officers, subject to such terms, conditions and limitations as the
Committee may establish in its sole discretion; provided, however, that the
Committee shall not delegate its powers and duties under the Plan with regard
to officers or
A-2
<PAGE>
directors of the Company or any Affiliate who are subject to Section 16 of the
Securities Exchange Act of 1934, as amended.
(c) Power and Authority of the Board of Directors. Notwithstanding anything
to the contrary contained herein, the Board of Directors may, at any time and
from time to time, without any further action of the Committee, exercise the
powers and duties of the Committee under the Plan with regard to any Person
who is not an officer or director of the Company or any Affiliate who is
subject to Section 16 of the Securities Exchange Act of 1934, as amended.
SECTION 4. SHARES AVAILABLE FOR AWARDS
(a) Shares Available. Subject to adjustment as provided in Section 4(c), the
aggregate number of Shares which may be issued under all Awards under the Plan
shall be 3,500,000. Shares to be issued under the Plan may be either Shares
reacquired and held in the treasury or authorized but unissued Shares. If any
Shares covered by an Award or to which an Award relates are not purchased or
are forfeited, or if an Award otherwise terminates without delivery of any
Shares, then the number of Shares counted against the aggregate number of
Shares available under the Plan with respect to such Award, to the extent of
any such forfeiture or termination, shall again be available for granting
Awards under the Plan.
(b) Accounting for Awards. For purposes of this Section 4, if an Award
entitles the holder thereof to receive or purchase Shares, the number of
Shares covered by such Award or to which such Award relates shall be counted
on the date of grant of such Award against the aggregate number of Shares
available for granting Awards under the Plan.
(c) Adjustments. In the event that the Committee shall determine that any
dividend or other distribution (whether in the form of cash, Shares, other
securities or other property), recapitalization, stock split, reverse stock
split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase or exchange of Shares or other securities of the Company, issuance
of warrants or other rights to purchase Shares or other securities of the
Company or other similar corporate transaction or event affects the Shares
such that an adjustment is determined by the Committee to be appropriate in
order to prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under the Plan, then the Committee shall, in
such manner as it may deem equitable, adjust any or all of (i) the number and
type of Shares (or other securities or other property) which thereafter may be
made the subject of Awards, (ii) the number and type of Shares (or other
securities or other property) subject to outstanding Awards and (iii) the
purchase or exercise price with respect to any Award; provided, however, that
the number of Shares covered by any Award or to which such Award relates shall
always be a whole number.
(d) Award Limitations Under the Plan. No Eligible Person, who is an employee
of the Company at the time of grant, may be granted any Option, Stock
Appreciation Right and such Other Stock Based Award (the value of which is
based solely on an increase in the value of the Shares after the date of
grant) for more than 250,000 Shares (subject to adjustment as provided for in
Section 4(c)), taking into account all such awards granted by the Company
pursuant to any of its stock compensation plans, in any calendar year period
beginning with the period commencing January 1, 1997. The foregoing annual
limitation specifically includes the grant of any Awards representing
"qualified performance-based compensation" within the meaning of Section
162(m) of the Code.
SECTION 5. ELIGIBILITY
Any Eligible Person, including any Eligible Person who is an officer or
director of the Company or any Affiliate, shall be eligible to be designated a
Participant. In determining which Eligible Persons shall receive an Award and
the terms of any Award, the Committee may take into account the nature of the
A-3
<PAGE>
services rendered by the respective Eligible Persons, their present and
potential contributions to the success of the Company or such other factors as
the Committee, in its discretion, shall deem relevant. Notwithstanding the
foregoing, an Incentive Stock Option may only be granted to full or part-time
employees (which term as used herein includes, without limitation, officers
and directors who are also employees) and an Incentive Stock Option shall not
be granted to an employee of an Affiliate unless such Affiliate is also a
"subsidiary corporation" of the Company within the meaning of Section 424(f)
of the Code or any successor provision.
SECTION 6. AWARDS
(a) Options. The Committee is hereby authorized to grant Options to
Participants with the following terms and conditions and with such additional
terms and conditions not inconsistent with the provisions of the Plan as the
Committee shall determine:
(i) Exercise Price. The purchase price per Share purchasable under an
Option shall be determined by the Committee; provided, however, that such
purchase price shall not be less than 100% of the Fair Market Value of a
Share on the date of grant of such Option.
(ii) Option Term. The term of each Option shall be fixed by the
Committee.
(iii) Time and Method of Exercise. The Committee shall determine the time
or times at which an Option may be exercised in whole or in part and the
method or methods by which, and the form or forms (including, without
limitation, cash, Shares, promissory notes, other securities, other Awards
or other property, or any combination thereof, having a Fair Market Value
on the exercise date equal to the relevant exercise price) in which,
payment of the exercise price with respect thereto may be made or deemed to
have been made.
(iv) Restoration Options. The Committee may grant Restoration Options,
separately or together with another Option, pursuant to which, subject to
the terms and conditions established by the Committee and any applicable
requirements of Rule 16b-3 or any other applicable law, the Participant
would be granted a new Option when the payment of the exercise price of the
option to which such Restoration Option relates is made by the delivery or
withholding of Shares pursuant to the relevant provisions of the plan or
agreement relating to such option, which new Option would be an Option to
purchase the number of Shares not exceeding the sum of (A) the number of
Shares so provided as consideration upon the exercise of the previously
granted option to which such Restoration Option relates and (B) the number
of Shares, if any, tendered or withheld as payment of the amount to be
withheld under applicable tax laws in connection with the exercise of the
option to which such Restoration Option relates pursuant to the relevant
provisions of the plan or agreement relating to such option. Restoration
Options may be granted with respect to options previously granted under the
Plan or any other stock option plan of the Company, and may be granted in
connection with any option granted under the Plan or any other stock option
plan of the Company at the time of such grant; provided, however, that
Restoration Options may not be granted with respect to any option granted
to a Non-Employee Director under the Company's 1983 Employee Stock Option
Plan.
(b) Stock Appreciation Rights. The Committee is hereby authorized to grant
Stock Appreciation Rights to Participants subject to the terms of the Plan and
any applicable Award Agreement. A Stock Appreciation Right granted under the
Plan shall confer on the holder thereof a right to receive upon exercise
thereof the excess of (i) the Fair Market Value of one Share on the date of
exercise (or, if the Committee shall so determine, at any time during a
specified period before or after the date of exercise) over (ii) the grant
price of the Stock Appreciation Right as specified by the Committee, which
price shall not be less than 100% of the Fair Market Value of one Share on the
date of grant of the Stock Appreciation Right. Subject to the terms of the
Plan and any applicable Award Agreement, the grant price, term, methods of
exercise, dates of exercise, methods of settlement and any other terms and
conditions of any Stock Appreciation Right shall be as determined by the
Committee. The
A-4
<PAGE>
Committee may impose such conditions or restrictions on the exercise of any
Stock Appreciation Right as it may deem appropriate.
(c) Restricted Stock and Restricted Stock Units. The Committee is hereby
authorized to grant Awards of Restricted Stock and Restricted Stock Units to
Participants with the following terms and conditions and with such additional
terms and conditions not inconsistent with the provisions of the Plan as the
Committee shall determine:
(i) Restrictions. Shares of Restricted Stock and Restricted Stock Units
shall be subject to such restrictions as the Committee may impose
(including, without limitation, any limitation on the right to vote a Share
of Restricted Stock or the right to receive any dividend or other right or
property with respect thereto), which restrictions may lapse separately or
in combination at such time or times, in such installments or otherwise as
the Committee may deem appropriate.
(ii) Stock Certificates. Any Restricted Stock granted under the Plan
shall be evidenced by issuance of a stock certificate or certificates,
which certificate or certificates shall be held by the Company. Such
certificate or certificates shall be registered in the name of the
Participant and shall bear an appropriate legend referring to the terms,
conditions and restrictions applicable to such Restricted Stock. In the
case of Restricted Stock Units, no Shares shall be issued at the time such
Awards are granted.
(iii) Forfeiture; Delivery of Shares. Except as otherwise determined by
the Committee, upon termination of employment (as determined under criteria
established by the Committee) during the applicable restriction period, all
Shares of Restricted Stock and all Restricted Stock Units at such time
subject to restriction shall be forfeited and reacquired by the Company;
provided, however, that the Committee may, when it finds that a waiver
would be in the best interest of the Company, waive in whole or in part any
or all remaining restrictions with respect to Shares of Restricted Stock or
Restricted Stock Units. Any Share representing Restricted Stock that is no
longer subject to restrictions shall be delivered to the holder thereof
promptly after the applicable restrictions lapse or are waived. Upon the
lapse or waiver of restrictions and the restricted period relating to
Restricted Stock Units evidencing the right to receive Shares, such Shares
shall be issued and delivered to the holders of the Restricted Stock Units.
(d) Performance Awards. The Committee is hereby authorized to grant
Performance Awards to Participants subject to the terms of the Plan and any
applicable Award Agreement. A Performance Award granted under the Plan (i) may
be denominated or payable in cash, Shares (including, without limitation,
Restricted Stock), other securities, other Awards or other property and (ii)
shall confer on the holder thereof the right to receive payments, in whole or
in part, upon the achievement of such performance goals during such
performance periods as the Committee shall establish. Subject to the terms of
the Plan and any applicable Award Agreement, the performance goals to be
achieved during any performance period, the length of any performance period,
the amount of any Performance Award granted, the amount of any payment or
transfer to be made pursuant to any Performance Award and any other terms and
conditions of any Performance Award shall be determined by the Committee.
(e) Other Stock-Based Awards. The Committee is hereby authorized to grant to
Participants such other Awards that are denominated or payable in, valued in
whole or in part by reference to, or otherwise based on or related to, Shares
(including, without limitation, securities convertible into Shares), as are
deemed by the Committee to be consistent with the purpose of the Plan;
provided, however, that such grants must comply with Rule 16b-3 and applicable
law. Subject to the terms of the Plan and any applicable Award Agreement, the
Committee shall determine the terms and conditions of such Awards. Shares or
other securities delivered pursuant to a purchase right granted under this
Section 6(f) shall be purchased for such consideration, which may be paid by
such method or methods and in such form or forms (including without
limitation, cash, Shares, promissory notes, other securities, other Awards or
other property or any combination thereof), as the Committee shall
A-5
<PAGE>
determine, the value of which consideration, as established by the Committee,
shall not be less than 100% of the Fair Market Value of such Shares or other
securities as of the date such purchase right is granted.
(f) General.
(i) No Cash Consideration for Awards. Awards shall be granted for no cash
consideration or for such minimal cash consideration as may be required by
applicable law.
(ii) Awards May Be Granted Separately or Together. Awards may, in the
discretion of the Committee, be granted either alone or in addition to, in
tandem with or in substitution for any other Award or any award granted
under any plan of the Company or any Affiliate other than the Plan. Awards
granted in addition to or in tandem with other Awards or in addition to or
in tandem with awards granted under any such other plan of the Company or
any Affiliate may be granted either at the same time as or at a different
time from the grant of such other Awards or awards.
(iii) Forms of Payment under Awards. Subject to the terms of the Plan and
of any applicable Award Agreement, payments or transfers to be made by the
Company or an Affiliate upon the grant, exercise or payment of an Award may
be made in such form or forms as the Committee shall determine (including,
without limitation, cash, Shares, promissory notes, other securities, other
Awards or other property or any combination thereof), and may be made in a
single payment or transfer, in installments or on a deferred basis, in each
case in accordance with rules and procedures established by the Committee.
Such rules and procedures may include, without limitation, provisions for
the payment or crediting of reasonable interest on installment or deferred
payments.
(iv) Term of Awards. The term of each Award shall be for such period as
may be determined by the Committee.
(v) Restrictions; Securities Exchange Listing. All certificates for
Shares or other securities delivered under the Plan pursuant to any Award
or the exercise thereof shall be subject to such stop transfer orders and
other restrictions as the Committee may deem advisable under the Plan or
the rules, regulations and other requirements of the Securities and
Exchange Commission and any applicable federal or state securities laws,
and the Committee may cause a legend or legends to be placed on any such
certificates to make appropriate reference to such restrictions. If the
Shares or other securities are traded on a securities exchange, the Company
shall not be required to deliver any Shares or other securities covered by
an Award unless and until such Shares or other securities have been
admitted for trading on such securities exchange.
SECTION 7. AMENDMENT AND TERMINATION; ADJUSTMENTS
Except to the extent prohibited by applicable law and unless otherwise
expressly provided in an Award Agreement or in the Plan:
(a) Amendments to the Plan. The Board of Directors of the Company may
amend, alter, suspend, discontinue or terminate the Plan; provided,
however, that, notwithstanding any other provision of the Plan or any Award
Agreement, without the approval of the stockholders of the Company, no such
amendment, alteration, suspension, discontinuation or termination shall be
made that, absent such approval:
(i) would cause Rule 16b-3 to become unavailable with respect to the
Plan;
(ii) would violate the rules or regulations of the New York Stock
Exchange, any other securities exchange or the National Association of
Securities Dealers, Inc. that are applicable to the Company; or
(iii) would cause the Company to be unable, under the Code, to grant
Incentive Stock Options under the Plan.
A-6
<PAGE>
(b) Amendments to Awards. The Committee may waive any conditions of or
rights of the Company under any outstanding Award, prospectively or
retroactively. The Committee may not amend, alter, suspend, discontinue or
terminate any outstanding Award, prospectively or retroactively, without
the consent of the Participant or holder or beneficiary thereof, except as
otherwise herein provided.
(c) Correction of Defects, Omissions and Inconsistencies. The Committee
may correct any defect, supply any omission or reconcile any inconsistency
in the Plan or any Award in the manner and to the extent it shall deem
desirable to carry the Plan into effect.
SECTION 8. INCOME TAX WITHHOLDING
In order to comply with all applicable federal or state income tax laws or
regulations, the Company may take such action as it deems appropriate to
ensure that all applicable federal or state payroll, withholding, income or
other taxes, which are the sole and absolute responsibility of a Participant,
are withheld or collected from such Participant. In order to assist a
Participant in paying all or a portion of the federal and state taxes to be
withheld or collected upon exercise or receipt of (or the lapse of
restrictions relating to) an Award, the Committee, in its discretion and
subject to such additional terms and conditions as it may adopt, may permit
the Participant to satisfy such tax obligation by (i) electing to have the
Company withhold a portion of the Shares otherwise to be delivered upon
exercise or receipt of (or the lapse of restrictions relating to) such Award
with a Fair Market Value equal to the amount of such taxes or (ii) delivering
to the Company Shares other than Shares issuable upon exercise or receipt of
(or the lapse of restrictions relating to) such Award with a Fair Market Value
equal to the amount of such taxes. The election, if any, must be made on or
before the date that the amount of tax to be withheld is determined.
SECTION 9. GENERAL PROVISIONS
(a) No Rights to Awards. No Eligible Person, Participant or other Person
shall have any claim to be granted any Award under the Plan, and there is no
obligation for uniformity of treatment of Eligible Persons, Participants or
holders or beneficiaries of Awards under the Plan. The terms and conditions of
Awards need not be the same with respect to any Participant or with respect to
different Participants.
(b) Award Agreements. No Participant will have rights under an Award granted
to such Participant unless and until an Award Agreement shall have been duly
executed on behalf of the Company.
(c) No Limit on Other Compensation Arrangements. Nothing contained in the
Plan shall prevent the Company or any Affiliate from adopting or continuing in
effect other or additional compensation arrangements, and such arrangements
may be either generally applicable or applicable only in specific cases.
(d) No Right to Employment. The grant of an Award shall not be construed as
giving a Participant the right to be retained in the employ of the Company or
any Affiliate, nor will it affect in any way the right of the Company or an
Affiliate to terminate such employment at any time, with or without cause. In
addition, the Company or an Affiliate may at any time dismiss a Participant
from employment free from any liability or any claim under the Plan, unless
otherwise expressly provided in the Plan or in any Award Agreement.
(e) Governing Law. The validity, construction and effect of the Plan or any
Award, and any rules and regulations relating to the Plan or any Award, shall
be determined in accordance with the laws of the State of Minnesota.
A-7
<PAGE>
(f) Severability. If any provision of the Plan or any Award is or becomes or
is deemed to be invalid, illegal or unenforceable in any jurisdiction or would
disqualify the Plan or any Award under any law deemed applicable by the
Committee, such provision shall be construed or deemed amended to conform to
applicable laws, or if it cannot be so construed or deemed amended without, in
the determination of the Committee, materially altering the purpose or intent
of the Plan or the Award, such provision shall be stricken as to such
jurisdiction or Award, and the remainder of the Plan or any such Award shall
remain in full force and effect.
(g) No Trust or Fund Created. Neither the Plan nor any Award shall create or
be construed to create a trust or separate fund of any kind or a fiduciary
relationship between the Company or any Affiliate and a Participant or any
other Person. To the extent that any Person acquires a right to receive
payments from the Company or any Affiliate pursuant to an Award, such right
shall be no greater than the right of any unsecured general creditor of the
Company or any Affiliate.
(h) No Fractional Shares. No fractional Shares shall be issued or delivered
pursuant to the Plan or any Award, and the Committee shall determine whether
cash shall be paid in lieu of any fractional Shares or whether such fractional
Shares or any rights thereto shall be canceled, terminated or otherwise
eliminated.
(i) Headings. Headings are given to the Sections and subsections of the Plan
solely as a convenience to facilitate reference. Such headings shall not be
deemed in any way material or relevant to the construction or interpretation
of the Plan or any provision thereof.
SECTION 10. EFFECTIVE DATE OF THE PLAN
The Plan shall be effective as of April 14, 1993, subject to approval by the
stockholders of the Company within one year thereafter.
SECTION 11. TERM OF THE PLAN
Unless the Plan shall have been discontinued or terminated as provided in
Section 7(a), the Plan shall terminate on April 13, 2003. No Award shall be
granted after the termination of the Plan. However, unless otherwise expressly
provided in the Plan or in an applicable Award Agreement, any Award
theretofore granted may extend beyond the termination of the Plan, and the
authority of the Committee provided for hereunder with respect to the Plan and
any Awards, and the authority of the Board of Directors of the Company to
amend the Plan, shall extend beyond the termination of the Plan.
A-8
<PAGE>
EXHIBIT B
SUPERVALU INC.
1983 EMPLOYEE STOCK OPTION PLAN
1. PURPOSE. The purpose of this Plan is to promote the interests of
SUPERVALU INC., a Delaware corporation (the "Corporation"), and its
stockholders by encouraging selected key salaried management employees of the
Corporation, and members of the Board of Directors who are not also employees
of the Corporation, to invest in shares of the Corporation's Common Stock with
the increased personal interest and effort in the continued success and
progress of the business that stock ownership can produce, and by providing
additional means of attracting and retaining competent executive personnel and
directors.
2. ADMINISTRATION; GRANTING OF OPTIONS. The Plan shall be administered by
the Board of Directors of the Corporation.
The Board of Directors shall have full authority in its discretion, but
subject to the express provisions of the Plan, to:
(a) determine the purchase price of the Common Stock covered by each
option;
(b) determine the persons to whom and the time or times at which options
shall be granted;
(c) determine the number of shares to be subject to each option;
(d) determine terms and provisions (and amendments thereof) of the
respective option agreements (which need not be identical), including such
terms and provisions (and amendments) as shall be required in the judgment
of the Board to conform to any law or regulation applicable thereto;
(e) determine which options shall be Incentive Stock Options within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code");
(f) accelerate the time at which all or any part of an option may be
exercised;
(g) modify or amend any outstanding option agreement subject to the
consent of optionee;
(h) interpret the Plan and prescribe, amend and rescind rules and
regulations relating to it;
(i) make all other determinations deemed necessary or advisable for the
administration of the Plan.
All decisions, determinations and selections made by the Board of Directors
on the foregoing matters shall be conclusive.
The granting of an option pursuant to the Plan shall be effective only when
an option is duly awarded to an employee or director by the Board of
Directors.
The Executive Committee of the Corporation, in addition to and not to the
exclusion of the Board of Directors of the Corporation, is authorized to
exercise all of the powers authorized and conferred by the Plan on the Board
of Directors other than the power under Section 12 of this Plan to terminate
and amend the Plan.
The Board of Directors may also authorize, at any time, the formation of a
Stock Option Committee (the "Committee"), consisting of three or more members
appointed from time to time by the Board, which Committee would have authority
to exercise the powers conferred on the Board under the Plan, other than the
power under Section 12 herein to terminate and amend the Plan. In
B-1
<PAGE>
addition, the Board of Directors may authorize, at any time, the Chief
Executive Officer of the Corporation to extend the period of exercise of
certain Incentive Stock Options and non-incentive (non-qualified) stock
options in accordance with the provisions set forth in the option agreement.
3. ELIGIBILITY; FACTORS TO BE CONSIDERED IN GRANTING STOCK
OPTIONS. Incentive Stock Options may be granted only to key salaried
management employees (which term, as used herein, includes officers) of the
Corporation and of its present and future subsidiary corporations. Options
which do not qualify as Incentive Stock Options may be granted to key salaried
management employees of the Corporation and of its present and future
subsidiary corporations and to members of the Board of Directors of the
Corporation who are not also employees of the Corporation or one of its
subsidiaries ("Non-Employee Directors"), provided, however, that options shall
be granted to Non- Employee Directors only pursuant to Section 7 hereof.
In determining the employees to whom options shall be granted and the number
of shares to be covered by each such option, the Board of Directors may take
into account the nature of the services rendered by the respective employees,
their present and potential contributions to the success of the Corporation
and such other factors as the Board of Directors, in its discretion, shall
deem relevant.
Subject to the provisions of Section 10 herein, an employee who has been
granted an option under the Plan or under any prior stock option plan of the
Corporation may be granted an additional option or options under the Plan if
the Board of Directors shall so determine.
4. SHARES SUBJECT TO THE PLAN. Subject to adjustment as provided in Section
11 herein:
(a) the stock to be offered under the Plan shall be shares of the
Corporation's authorized Common Stock, par value $1.00 per share, which may
be either shares reacquired and held in the treasury of the Corporation or
authorized but unissued shares; and
(b) the aggregate number of shares which may be issued under all options
granted pursuant to the Plan shall be 4,500,000 shares.
Shares subject to, but not issued under, any option terminating or expiring
for any reason prior to exercise thereof in full shall again be available for
other options thereafter granted under the Plan.
5. TERM OF PLAN AND OF EACH OPTION AGREEMENT; EXERCISE OF OPTIONS. The
period during which options may be granted under the Plan shall expire
February 7, 1999. The term of each option so granted shall expire not more
than ten years from the date the option is granted.
The Board of Directors may determine at the time of granting whether each
such option is exercisable in full, in part from time to time or in
installments, which may be cumulative from year to year during such term to
the extent not exercised in a prior year; provided, however, that
notwithstanding the foregoing, from and after a Change of Control (as
hereinafter defined), all options granted under the Plan, including options
granted to Non-Employee Directors pursuant to Section 7 hereof, shall become
immediately exercisable to the full extent of the original award. As used
herein, "Change of Control" shall mean any of the following events:
(i) The acquisition by any person, entity or "group", within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), other than the Corporation or any of its
wholly-owned subsidiaries, or any employee benefit plan of the Corporation
and/or one or more of its wholly-owned subsidiaries, of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange
Act) of 20% or more of either the then outstanding shares of Common Stock
or the combined voting power of the Corporation's then outstanding voting
securities in a transaction or series of transactions not approved in
advance by a vote of at least three-quarters of the Continuing Directors
(as hereinafter defined); or
B-2
<PAGE>
(ii) Individuals who, as of April 13, 1988, constitute the Board of
Directors of the Corporation (generally the "Directors" and as of April 13,
1988 the "Continuing Directors") cease for any reason to constitute at
least a majority thereof, provided that any person becoming a Director
subsequent to April 13, 1988 whose nomination for election was approved in
advance by a vote of at least three-quarters of the Continuing Directors
(other than a nomination of an individual whose initial assumption of
office is in connection with an actual or threatened solicitation with
respect to the election or removal of the Directors of the Corporation, as
such terms are used in Rule 14a-11 of Regulation 14A under the Exchange
Act) shall be deemed to be a Continuing Director; or
(iii) The approval by the stockholders of the Corporation of a
reorganization, merger, consolidation, liquidation or dissolution of the
Corporation or of the sale (in one transaction or a series of related
transactions) of all or substantially all of the assets of the Corporation
other than a reorganization, merger, consolidation, liquidation,
dissolution or sale approved in advance by a vote of at least three
quarters of the Continuing Directors; or
(iv) The first purchase under any tender offer or exchange offer (other
than an offer by the Corporation or any of its subsidiaries) pursuant to
which shares of Common Stock are purchased.
Options granted under this Plan need not be identical with respect to the
terms of exercise thereof. Subject only to the foregoing limitations, options
may be exercised in whole at any time or in part from time to time during the
option term by serving written notice of exercise on the Corporation,
accompanied by payment of the purchase price.
The Board of Directors or the Committee, as the case may be, may grant
"restoration" options, separately or together with another option, pursuant to
which, subject to the terms and conditions established by the Board of
Directors or the Committee, as the case may be, and any applicable
requirements of Rule 16b-3 promulgated under the Exchange Act or any other
applicable law, the optionee would be granted a new option when the payment of
the exercise price of the option to which such "restoration" option relates is
made by the delivery of shares of the Corporation's Common Stock owned by the
optionee, as described in Section 6 hereof, which new option would be an
option to purchase the number of shares not exceeding the sum of (a) the
number of shares of the Corporation's Common Stock tendered as payment upon
the exercise of the option to which such "restoration" option relates and (b)
the number of shares of the Corporation's Common Stock, if any, tendered as
payment of the amount to be withheld under applicable income tax laws in
connection with the exercise of the option to which such "restoration" option
relates, as described in Section 14 hereof. "Restoration" options may be
granted with respect to options previously granted under this Plan or any
prior stock option plan of the Corporation, and may be granted in connection
with any option granted under this Plan (other than an option granted to a
Non-Employee Director pursuant to Section 7 hereof) at the time of such grant.
The purchase price of the Common Stock under each such new option, and the
other terms and conditions of such option, shall be determined by the Board of
Directors or the Committee, as the case may be, consistent with the provisions
of the Plan.
6. OPTION PRICES. Except with respect to options granted to Non-Employee
Directors pursuant to Section 7 hereof, the purchase price of the Common Stock
under each option shall be determined by the Board of Directors, but shall not
be less than 100% of the fair market value of the Common Stock at the time of
granting the option as found by the Board.
The purchase price of the shares as to which an option shall be exercised
shall be paid in full in cash at the time of exercise as shall be provided in
the option agreement, and any optionee, without limitation, shall also be
entitled to pay the exercise price by tendering to the Corporation shares of
the Corporation's Common Stock, previously owned by the optionee, having a
fair market value on the date of exercise equal to the option price (or the
portion thereof not paid in cash).
B-3
<PAGE>
7. OPTIONS TO NON-EMPLOYEE DIRECTORS. The Board of Directors or the
Committee, as the case may be, shall issue options which do not qualify as
Incentive Stock Options to Non-Employee Directors in accordance with this
Section 7.
Each Non-Employee Director serving on the Corporation's Board of Directors
immediately following the Annual Meeting of Stockholders of the Corporation on
June 30, 1992 shall be granted, as of June 30, 1992, an option to purchase
3,000 shares of Common Stock. Each Non-Employee Director first elected or
appointed to the Corporation's Board of Directors after June 30, 1992 and
during the term of the Plan shall be granted, as of the date of such
Director's first election or appointment to the Board of Directors, an option
to purchase 3,000 shares of Common Stock. After the initial grant to each Non-
Employee Director as set forth above in this Section 7, each such Director
shall be granted during the term of the Plan, as of the date of the
Corporation's Annual Meeting of Stockholders in each even-numbered year, if
such Director's term of office continues after such Annual Meeting, an option
to purchase 3,000 shares of Common Stock.
Each option granted to a Non-Employee Director pursuant to this Section 7
shall have an exercise price equal to the fair market value of the shares of
Common Stock as of the date of grant and shall expire on the tenth anniversary
of the date of grant. "Restoration" options may not be granted to any Non-
Employee Director. This Section 7 shall not be amended more than once every
six months other than to comport with changes in the Code, the Employee
Retirement Income Security Act or the rules and regulations thereunder.
8. ADDITIONAL TERMS. Options granted under the Plan shall not be affected by
any change of duties or position so long as the optionee continues to be an
employee of the Corporation or of a subsidiary (or continues to be a Director
of the Corporation in the case of any Non-Employee Director). Each option
agreement may contain such provisions as the Board of Directors shall approve
with reference to the effect of approved leaves of absence, provided that with
respect to Incentive Stock Options such provisions conform to the requirements
of the Code.
Nothing in the Plan or in any option granted pursuant thereto shall confer
on any person any right to continue in the employ of the Corporation or of any
of its subsidiaries (or to continue as a Director of the Corporation in the
case of any Non-Employee Director) or affect, in any way, the right of the
Corporation or any of its subsidiaries to terminate his employment (or to
terminate his directorship in the case of any Non-Employee Director) at any
time.
No optionee, who is an employee of the Corporation at the time of grant, may
be granted any option or options for more than 250,000 Shares (subject to
adjustment as provided for in Section 11), taking into account all such awards
granted by the Corporation pursuant to any of its stock compensation plans, in
any calendar year period beginning with the period commencing January 1, 1997.
The foregoing annual limitation specifically includes the grant of any options
representing "qualified performance-based compensation" within the meaning of
Section 162(m) of the Code.
9. DEATH; OTHER TERMINATION OF EMPLOYMENT OR DIRECTORSHIP. Each option
agreement shall include provisions governing the disposition of an option in
the event of the retirement, disability, death or other termination of the
employment or directorship of an optionee with the Corporation or an
Affiliate.
10. INCENTIVE STOCK OPTIONS. Except with respect to options granted to Non-
Employee Directors pursuant to Section 7 hereof, the Board of Directors is
hereby authorized to determine, upon the granting of each option, whether such
option shall be an Incentive Stock Option under Section 422 of the Code or
shall be an option which is not an Incentive Stock Option under Section 422.
For Incentive Stock Options granted before January 1, 1987, the aggregate fair
market value of the stock (determined as of the time the Incentive Stock
Option is granted) covered under all Incentives Stock
B-4
<PAGE>
Options granted (under this Plan and all other incentive stock option plans of
the Corporation or any subsidiary), in any calendar year, shall not exceed
$100,000 plus any unused limit carry-over (as provided under former Section
422(c)(4) of the Code effective for options granted before January 1, 1987).
For Incentive Stock Options granted after December 31, 1986, the aggregate
fair market value (determined at the time the Incentive Stock Option is
granted) of the stock with respect to which all Incentive Stock Options are
exercisable for the first time by an employee during any calendar year (under
all plans described in subsection (b) of Section 422 of the Code of his
employer corporation and its parent and subsidiary corporations) shall not
exceed $100,000.
11. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. Notwithstanding any other
provision of the Plan, the Board of Directors may adjust the number and class
of shares subject to each outstanding option and the option prices in the
event of changes in the outstanding Common Stock of the Corporation by reason
of stock dividends, split-ups, recapitalizations, mergers, consolidations,
combinations or exchanges of shares and the like. In the event of any such
change in the outstanding Common Stock of the Corporation, the aggregate
number and class of shares available under the Plan shall be appropriately
adjusted by the Board of Directors, whose determination shall be conclusive.
12. TERMINATION AND AMENDMENT. The Plan may be terminated, modified or
amended by the stockholders of the Corporation.
Subject to Section 7 hereof, the Board of Directors of the Corporation may
also terminate the Plan or make such modifications or amendments thereof as it
shall deem advisable, or to conform to any change in any law or regulation
applicable thereto; provided, however, that the Board of Directors may not,
without further approval by the holders of a majority of the outstanding stock
of the Corporation having general voting power, make any modification or
amendment which operates:
(a) to make any material change in the class of employees eligible to
receive Incentive Stock Options as defined in Section 3 above; and
(b) to increase the total number of shares for which options may be
granted under the Plan, except as resulting from the operation of Section
11 above.
No termination, modification or amendment of the Plan may, without the
consent of the employee to whom any option shall theretofore have been
granted, adversely affect the rights of such employee under such option.
13. EFFECTIVE DATE OF PLAN. The Plan shall become effective February 23,
1983, subject to approval by the shareholders of the Corporation within 12
months thereafter.
14. TAX WITHHOLDING. Subject to such rules as the Board of Directors or the
Committee may adopt not inconsistent with the provisions of the Plan:
(a) At any time when an optionee is required to pay the Corporation an
amount required to be withheld under applicable income tax laws in
connection with the exercise of an option which does not qualify as an
Incentive Stock Option under Section 422 of the Code, the optionee may
elect to have the Corporation retain from the distribution shares of Common
Stock to satisfy this obligation in whole or in part (an "Election"). The
shares to be withheld shall be valued at 100% of the fair market value of
the shares on the date that the amount of tax required to be paid shall be
determined (the "Tax Date"). Fair market value of the shares shall equal
the mean of the opening and closing trade prices of the shares as reported
on the New York Stock Exchange on the Tax Date, or, if no trading in the
shares occurs on the Tax Date, on the immediately preceding trading date.
(b) Each election must be made prior to the Tax Date. The Board or the
Committee may disapprove of any Election, may suspend or terminate the
right to make Elections, may limit the
B-5
<PAGE>
amount of any Election, may provide at the time of grant with respect to
any option that the right to make Elections shall not apply to such option
and may make rules concerning the required information to be included in
any Election. An Election is irrevocable.
(c) The Election may be made in an amount equal to the amount of tax
required by law to be withheld with respect to the option exercise. Any
fractional share withholding amount must be paid in cash.
(d) If an optionee makes an Election and the optionee's Tax Date is
deferred for six months from the date of exercise of the option, the
optionee will initially receive the full amount of the shares, but will be
unconditionally obligated to surrender to the Corporation on the Tax Date
the proper number of shares to satisfy the withholding obligation, plus
cash for any remainder of the withholding obligation including any
fractional shares withholding amount.
(e) Optionees who are "officers" or "directors" of the Corporation, as
those terms are used in Section 16(b) of the Exchange Act, may only make an
Election in compliance with the rules established by the Board or the
Committee to comply with Section 16(b).
B-6
<PAGE>
EXHIBIT C
SUPERVALU INC.
LONG-TERM INCENTIVE PLAN
SECTION I. ESTABLISHMENT
On February 12, 1992, the Board of Directors of SUPERVALU INC. (the
"Company"), upon recommendation by the Compensation and Stock Option Committee
(the "Committee"), approved an incentive plan for executives as described
herein, which plan shall be known as the "SUPERVALU INC. Long-Term Incentive
Plan" (the "Plan"). The Plan shall be submitted for approval by the
stockholders of the Company at the 1992 annual meeting of stockholders. The
Plan shall be effective as of February 12, 1992, subject to its approval by
the stockholders of the Company, and no shares shall be issued pursuant to the
Plan until after the Plan has been approved by the stockholders of the
Company.
SECTION II. PURPOSE
The purpose of the Plan is to advance the interests of the Company and its
stockholders by attracting and retaining key employees, and by stimulating the
efforts of such employees to contribute to the continued success and progress
of the business. The Plan is further intended to provide such employees with
an opportunity to increase their ownership of the Company's common stock with
the increased personal interest in the long-term success of the business that
such stock ownership can produce.
SECTION III. ADMINISTRATION
3.1 Composition of the Committee. The Plan shall be administered by the
Committee, which shall consist of members appointed from time to time by the
Board of Directors and shall be comprised of not less than such number of
directors as shall be required to permit the Plan to satisfy the requirements
of Rule 16b-3 promulgated by the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or any
successor rule or regulation ("Rule 16b-3"). All members of the Committee
shall be members of the Board of Directors of the Company who are
"disinterested persons" within the meaning of Rule 16b-3. To the extent
required by Section 162(m) of the Internal Revenue Code of 1986, as amended
(such statute, as it may be amended from time to time and all proposed,
temporary or final Treasury Regulations promulgated thereunder shall be
referred to as the "Code"), the Committee administering the Plan shall be
composed solely of "outside directors" within the meaning of Section 162(m) of
the Code.
3.2 Power and Authority of the Committee. The Committee shall have full
power and authority, subject to all the applicable provisions of the Plan and
applicable law, to (a) establish, amend, suspend or waive such rules and
regulations and appoint such agents as it deems necessary or advisable for the
proper administration of the Plan, (b) construe, interpret and administer the
Plan and any instrument or agreement relating to, or Award (as defined below
in Section 4.2) made under, the Plan, and (c) make all other determinations
and take all other actions necessary or advisable for the administration of
the Plan. Unless otherwise expressly provided in the Plan, each determination
made and each action taken by the Committee pursuant to the Plan or any
instrument or agreement relating to, or Award made under, the Plan shall be
(x) within the sole discretion of the Committee, (y) may be made at any time
and (z) shall be final, binding and conclusive for all purposes on all
persons, including, but not limited to, holders of Awards, and their legal
representatives and beneficiaries, and employees of the Company or of any
"Affiliate" of the Company. For purposes of the Plan and any instrument or
agreement relating to, or Award made under, the Plan, the term "Affiliate"
shall mean any entity that, directly or indirectly through one or more
intermediaries, is controlled by the Company
C-1
<PAGE>
and any entity in which the Company has a significant equity interest, in each
case as determined by the Committee in its sole discretion.
3.3 Delegation. The Committee may delegate its powers and duties under the
Plan to one or more officers of the Company or any Affiliate or a committee of
such officers, subject to such terms, conditions and limitations as the
Committee may establish in its sole discretion; provided, however, that the
Committee shall not delegate its power to amend the Plan as provided in
Section XI hereof and shall not delegate its power to make determinations
regarding officers or directors of the Company or any Affiliate who are
subject to Section 16 of the Exchange Act.
SECTION IV. ELIGIBILITY AND PARTICIPATION
4.1 Eligibility. The Plan is unfunded and is maintained by the Company for a
select group of management or highly compensated employees. In order to be
eligible to participate in the Plan, an employee of the Company or of its
Affiliates must be selected by the Committee. In determining the employees who
will participate in the Plan, the Committee may take into account the nature
of the services rendered by the respective employees, their present and
potential contributions to the success of the Company and such other factors
as the Committee, in its sole discretion, shall deem relevant. A director of
the Company or of an Affiliate who is not also an employee of the Company or
an Affiliate shall not be eligible to participate in the Plan.
4.2 Participation. The Committee shall determine the employees to be granted
an award opportunity (the "Award"), the amount of each Award, the time or
times when Awards will be made, the period of time over which such Awards are
intended to be earned, and all other terms and conditions of each Award. The
provisions of the Awards need not be the same with respect to any recipient of
an Award (the "Participant") or with respect to different Participants. The
Committee's decision to approve an Award to an employee in any year shall not
require the Committee to approve a similar Award or any Award at all to that
employee or any other employee or person at any future date. The Company and
the Committee shall not have any obligation for uniformity of treatment of any
person, including, but not limited to, Participants and their legal
representatives and beneficiaries and employees of the Company or of any
Affiliate of the Company.
4.3 Award Agreement. Any employee selected for participation by the
Committee shall, as a condition of participation, execute and return to the
Committee a written agreement setting forth the terms and conditions of the
Award (the "Award Agreement"). A separate Award Agreement will be entered into
between the Company and each Participant for each Award.
4.4 Employment. In the absence of any specific agreement to the contrary, no
Award to a Participant under the Plan shall affect any right of the Company,
or of any Affiliate of the Company, to terminate, with or without cause, the
Participant's employment at any time.
SECTION V. SHARES SUBJECT TO THE PLAN
5.1 Shares Subject to Plan. Subject to adjustment as provided in Section 5.3
hereof, the maximum number of shares or units equivalent to shares with
respect to which Awards may be granted under the Plan shall not exceed in the
aggregate 750,000 shares (the "Shares") of the Company's Common Stock, $1.00
par value (the "Common Stock"). The payment of cash dividends or dividend
equivalents in conjunction with an Award shall not be counted against the
Shares available for grant. Shares to be issued pursuant to the Plan shall be
made available from treasury, from authorized but unissued shares of Common
Stock, or from shares reacquired by the Company, including shares purchased in
the open market. For purposes of this Section V, the maximum number of Shares
to which an Award relates shall be counted on the date such Award was made
against the aggregate number of Shares available for grant under the Plan.
C-2
<PAGE>
5.2 Reacquired Shares. If any Shares to which an Award relates are
forfeited, or if an Award is otherwise canceled or terminated or expires
without delivery of the maximum number of Shares (or cash for the maximum
number of Shares) to which such Award relates, then the number of Shares with
respect to such Award, to the extent of any such forfeiture, cancellation,
termination or expiration, shall again be available for grant under the Plan.
5.3 Adjustments Upon Chances In Capitalization. In the event that the
Committee shall determine that any dividend or other distribution (whether in
the form of cash, Common Stock, other securities or other property), stock
split, reverse stock split, reorganization, recapitalization, merger,
consolidation, combination, split-up, spin-off, repurchase or exchange of
Common Stock or other securities of the Company, issuance of warrants or other
rights to purchase Common Stock or other securities of the Company, or other
similar corporate transaction or event affects the Common Stock such that an
adjustment is determined by the Committee to be appropriate in order to
prevent dilution or enlargement of the benefits or potential benefits intended
to be made available under the Plan, then the Committee may make such
adjustments, if any, as it may deem appropriate in the aggregate number of and
class of Shares (or other securities or other property) issuable pursuant to
Section 5.1 and pursuant to any outstanding Award under the Plan. The
Committee's determination of such adjustments shall be final, binding and
conclusive.
SECTION VI. AWARDS
6.1 General. The Committee shall determine the Award or Awards to be made to
each Participant, and each Award shall be subject to the terms and conditions
of the Plan and the applicable Award Agreement. An Award may be made in the
form of Shares or in the form of units equivalent to Shares (the "Stock
Units"). Awards may be granted singly or in combination, or in addition to, in
tandem with or in substitution for any grants or rights under any employee or
compensation plan of the Company or of any Affiliate. All or part of an Award
may be subject to conditions and forfeiture provisions established by the
Committee, and set forth in the Award Agreement, which may include, but are
not limited to, continuous service with the Company or an Affiliate,
achievement of specific business objectives, and other measurement of
individual, business unit or Company performance.
6.2 Award of Shares. If an Award is granted in the form of Shares,
certificates representing the Shares shall be issued in the name of the
Participant, but may be retained in the custody of the Company and may be
legended to indicate restriction on transferability ("Restricted Stock") until
the Participant has met designated performance and/or length of employment
requirements, if any, and the determination of the number of Shares, if any,
that are to be forfeited pursuant to the terms of the Award is made. Until
such time as all restrictions are removed, Restricted Stock shall not be
transferable.
6.3 Award of Stock Units. If an Award is granted in the form of Stock Units,
no certificates shall be issued with respect to such Stock Units, but the
Company shall maintain a bookkeeping account in the name of the Participant to
which the Stock Units shall relate. Each Stock Unit shall represent the right
to receive a payment of one Share, or cash of equivalent value to the "fair
market value" of the Company's Common Stock at the time payment is made, or a
continuing Stock Unit, or other Awards, or a combination thereof, with such
restrictions and conditions as the Committee may determine in its sole
discretion, including, but not limited to, the restriction of such Shares as
Restricted Stock. For purposes of the Plan, "fair market value" shall be
determined by such methods or procedures as may be established from time to
time by the Committee in its sole discretion.
6.4 Voting Rights, Dividends and Dividend Equivalents. The Committee, in its
sole discretion, may provide that Awards of Shares may contain voting rights
and may earn dividends and that any Award may earn dividend equivalents. Such
dividends or dividend equivalents may be paid currently or may be credited to
an account established by the Committee under the Plan in the name of the
C-3
<PAGE>
Participant. Any crediting of dividend or dividend equivalents may be subject
to such restrictions and conditions as the Committee may establish in its sole
discretion, including reinvestment in additional shares or share equivalents.
6.5 Payment of Awards. Payment of Awards may be made at such times, with
such restrictions and conditions, and in such forms (cash, stock, including
Restricted Stock, Stock Units, other Awards, or combinations thereof) as the
Committee in its sole discretion may determine at the time of grant of the
Awards.
6.6 Securities Matters. No Shares shall be issued under the Plan prior to
such time as counsel to the Company shall have determined that the issuance
and delivery of such Shares will not violate any federal or state securities
or other laws. Participants may be required by the Company, as a condition to
the grant of an Award or the issuance of Shares under the Plan, to agree in
writing that all Shares to be acquired pursuant to the Plan shall be held for
his or her own account without a view to any further distribution thereof,
that the certificates for the Shares shall bear an appropriate legend to that
effect, and that such Shares will not be transferred or disposed of except in
compliance with applicable federal and state laws. The Company may, in its
sole discretion, defer the effectiveness of any Award or the payment of any
Award under the Plan in order to allow the issuance of Shares pursuant thereto
to be made pursuant to registration or an exemption from registration or other
methods for compliance available under federal or state securities laws. The
Company shall be under no obligation to effect the registration pursuant to
the Securities Act of 1933, as amended, of any Shares to be issued under the
Plan or to effect similar compliance under any state law. If Shares are traded
on a securities exchange, the Company shall not be required to deliver to the
Participant certificates representing any Shares unless and until such Shares
have been admitted for trading on such securities exchange.
6.7 Qualified Performance-Based Compensation. From time to time, the
Committee may designate an Award granted pursuant to the Plan as an award of
"qualified performance-based compensation" within the meaning of Section
162(m) of the Code (hereinafter referred to as a "Performance-Based
Award(s)"). Notwithstanding any other provision of the Plan to the contrary,
the following additional requirements shall apply to all Performance-Based
Awards made to any Participant under the Plan:
(a) Any Performance-Based Award shall be null and void and have no effect
whatsoever unless these amendments to the Plan, to the extent required by
the Code, shall have been approved by the stockholders of the Company at
the 1997 annual meeting of stockholders.
(b) For purposes of Section 162(m) of the Code, the only employees
eligible to receive Performance-Based Awards shall be the employee's
identified in Section 4.1 hereof.
(c) The right to obtain Restricted Stock or the right to have a Stock
Unit become payable in any fashion pursuant to a Performance-Based Award
shall be determined solely on account of the attainment of one or more
preestablished, objective performance goals for a performance period
selected by the Committee at the time of the grant of the Performance-Based
Award. Such goals shall be based solely on one or more of the following
business criteria, which may apply to the individual in question, an
identifiable business unit or the Company as a whole: stock price, market
share, sales, earnings per share, profitability targets as measured by
return ratios, cumulative total return to shareholders, consolidated pre-
tax earnings, net revenues, net earnings, operating income, earnings before
interest and taxes, and cash flow, for the applicable performance period
based on absolute Company or business unit performance and/or performance
as compared to a pre-selected peer group of companies or external financial
index, all as computed in accordance with generally accepted accounting
principles as in effect from time to time and as applied by the Company in
the preparation of its financial statements and subject to such other
C-4
<PAGE>
special rules and conditions as the Committee may establish at any time
ending on or before the 90th day of the applicable performance period. The
foregoing shall constitute the sole business criteria upon which the
performance goals under this Plan shall be based.
(d) The maximum number of Shares, whether or not in the form of
Restricted Stock, which may be issued to any Participant pursuant to any
Performance-Based Award in any calendar year period beginning with the
period commencing January 1, 1997, shall not exceed 50,000 shares (subject
to adjustment as provided for in Section 5.3).
(e) Not later than 90 days after the beginning of each performance period
selected by the Committee for a Performance-Based Award, it shall:
(i) designate all Participants for such performance period; and
(ii) establish the objective performance factors for each Participant
for that performance period on the basis of one or more of the business
criteria set forth herein.
(f) Following the close of each performance period and prior to payment
of any amount to any Participant under a Performance-Based Award, the
Committee must certify in writing as to the attainment of all factors
(including the performance factors for a Participant) upon which any
payments to a Participant for that performance period are to be based.
(g) Each of the foregoing provisions and all of the other terms and
conditions of the Plan as it applies to any Performance-Based Award shall
be interpreted in such a fashion so as to qualify all compensation paid
thereunder as "qualified performance-based compensation" within the meaning
of Section 162(m) of the Code.
SECTION VII. TERMINATION OF EMPLOYMENT
Each Award Agreement shall include provisions governing the disposition of
an Award in the event of the retirement, disability, death or other
termination of a Participant's employment with the Company or an Affiliate.
SECTION VIII. CHANGE IN CONTROL
Notwithstanding any other provision in the Plan to the contrary, at the time
of the grant of an Award, the Committee may determine to include provisions in
such Award providing that upon the occurrence of a "Change in Control," (i)
all outstanding Awards (including Restricted Stock and Stock Units) shall
immediately become fully vested (which, in the case of any Award which is
subject to the achievement of designated performance objectives during a
designated performance period, shall mean vested as if all such performance
objectives had been achieved at the 100% award level at the end of such
performance period) and (ii) all restrictions, conditions and limitations on
all Awards (including Restricted Stock and Stock Units) which are outstanding
at the time of such "Change in Control" or become outstanding by virtue of the
operation of clause (i) hereof shall immediately lapse, provided that the
provisions of clauses (i) and (ii) may be subject to such restrictions,
conditions and limitations as the Committee may determine at the time of grant
of the Award as set forth in the Award Agreement relating thereto.
For purposes of the Plan, "Change in Control" shall mean any of the
following events:
1. The acquisition by any person, entity or "group," within the meaning
of Section 13(d)(3) or 14(d)(2) of the Exchange Act, other than the Company
or any of its Affiliates, or any employee benefit plan of the Company
and/or one or more of its Affiliates, of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of
either the then outstanding shares of the Company's Common Stock or the
combined voting power of the Company's then outstanding voting securities
in a transaction or series of transactions not approved in advance by a
vote of at least three-quarters of the Continuing Directors (as hereinafter
defined); or
C-5
<PAGE>
2. Individuals who, as of February 12, 1992, constitute the Board of
Directors of the Company (generally the "Directors" and, as of February 12,
1992, the "Continuing Directors") cease for any reason to constitute at
least a majority thereof, provided that any person becoming a Director
subsequent to February 12, 1992 whose nomination for election was approved
in advance by a vote of at least three-quarters of the Continuing Directors
(other than a nomination of an individual whose initial assumption of
office is in connection with an actual or threatened solicitation with
respect to the election or removal of the Directors of the Company, as such
terms are used in Rule 14a-11 of Regulation 14A under the Exchange Act)
shall be deemed to be a Continuing Director; or
3. The approval by the stockholders of the Company of a reorganization,
merger, consolidation, liquidation or dissolution of the Company or of the
sale (in one transaction or a series of related transactions) of all or
substantially all of the assets of the Company other than a reorganization,
merger, consolidation, liquidation, dissolution or sale approved in advance
by a vote of at least three-quarters of the Continuing Directors; or
4. The first purchase under any tender offer or exchange offer (other
than an offer by the Company or any of its Affiliates) pursuant to which
shares of the Company's Common Stock are purchased; or
5. At least a majority of the Continuing Directors determine in their
sole discretion that there has been a Chance in control of the Company.
SECTION IX. NON-TRANSFERABILITY
Except as otherwise determined by the Committee or set forth in the
applicable Award Agreement, no Restricted Stock or Stock Unit, and no right
under such Restricted Stock or Stock Unit, shall be sold, assigned,
transferred, pledged, hypothecated or otherwise disposed of during the time in
which the requirement of continued employment or attainment of performance
objectives has not been achieved. Each right under any Award shall be
exercisable during the Participant's lifetime only by the Participant or, if
permissible under applicable law, by the Participant's legal representatives.
SECTION X. TAXES
In order to comply with all applicable federal or state income, social
security, payroll, withholding or other tax laws or regulations, the Company
may take such action, and may require a Participant to take such action, as it
deems appropriate to ensure that all applicable federal or state income,
social security, payroll, withholding or other taxes, which are the sole and
absolute responsibility of the Participant, are withheld or collected from
such Participant. In order to assist a Participant in paying all or part of
the federal and state taxes to be withheld or collected upon receipt or
payment of (or the lapse of restrictions relating to) an Award, the Committee,
in its sole discretion and subject to such additional terms and conditions as
it may adopt, may permit the Participant to satisfy such tax obligation by (a)
electing to have the Company withhold a portion of the shares of Common Stock
otherwise to be delivered upon receipt or payment of (or the lapse of
restrictions relating to) such Award with a fair market value equal to the
amount of such taxes or (b) delivering to the Company shares of Common Stock
other than the shares issuable upon receipt or payment of (or the lapse of
restrictions relating to) such Award with a fair market value equal to the
amount of such taxes.
SECTION XI. AMENDMENT AND TERMINATION
11.1 Term of Plan. Unless the Plan shall have been discontinued or
terminated as provided in Section 11.2 hereof, the Plan shall terminate on
February 11, 2002. No Awards may be granted after such termination, but
termination of the Plan shall not alter or impair any rights or obligations
under any Award theretofore granted, without the consent of the Participant or
holder or beneficiary thereof, except as otherwise provided in the Plan or the
Award Agreement.
C-6
<PAGE>
11.2 Amendments to Plan. Except to the extent prohibited by applicable law
and unless otherwise expressly provided in the Plan or an Award Agreement, the
Committee may amend, alter, suspend, discontinue or terminate the Plan;
provided, however, that notwithstanding any other provision of the Plan or any
Award Agreement, without the approval of the stockholders of the Company, no
such amendment, alteration, suspension, discontinuation or termination shall
be made that, absent such approval:
(a) would cause Rule 16b-3 to become unavailable with respect to the
Plan: or
(b) would violate the rules or regulations of any securities exchange
that are applicable to the Company.
11.3 Amendments to Awards. Except to the extent prohibited by applicable law
and unless otherwise expressly provided in the Plan or an Award Agreement, the
Committee may waive any condition of, or rights of the Company under, any
outstanding Award, prospectively or retroactively. The Committee may not
amend, alter, suspend, discontinue or terminate any outstanding Award,
prospectively or retroactively, without the consent of the Participant or
holder or beneficiary thereof, except as otherwise provided in the Plan or the
Award Agreement.
11.4 Correction of Defects, Omissions and Inconsistencies. Except to the
extent prohibited by applicable law and unless otherwise expressly provided in
the Plan or an Award Agreement, the Committee may correct any defect, supply
any omission or reconcile any inconsistency in the Plan, any Award or any
Award Agreement in the manner and to the extent it shall deem desirable to
carry the Plan into effect.
SECTION XII. MISCELLANEOUS
12.1 Governing Law. The Plan and any Award Agreement shall be governed by
and construed in accordance with the internal laws, and not the laws of
conflicts, of the State of Minnesota.
12.2 Severability. If any provision of the Plan, any Award or any Award
Agreement is or becomes or is deemed to be invalid, illegal or unenforceable
in any jurisdiction or would disqualify the Plan, any Award or any Award
Agreement under any law deemed applicable by the Committee, such provision
shall be construed or deemed amended to conform to applicable laws, or if it
cannot be so construed or deemed amended without, in the determination of the
Committee, materially altering the purpose or intent of the Plan, the Award or
the Award Agreement, such provision shall be stricken as to such jurisdiction,
and the remainder of the Plan, any such Award or any such Award Agreement
shall remain in full force and effect.
12.3 No Trust or Fund Created. Neither the Plan nor any Award or Award
Agreement shall create or be construed to create a trust or separate fund of
any kind or a fiduciary relationship between the Company or any Affiliate and
a Participant or any other person. To the extent that any person acquires a
right to receive payments from the Company or any Affiliate pursuant to an
Award, such right shall be no greater than the right of any unsecured general
creditor of the Company or of any Affiliate.
12.4 Headings. Headings are given to the sections and subsections of the
Plan solely as a convenience to facilitate reference. Such headings shall not
be deemed in any way material or relevant to the construction or
interpretation of the Plan or any provision thereof.
C-7
<PAGE>
LOGO
LOGO
Printed with soy
based inks on
recycled
paper containing at least 10% fibers from
paper recycled by
consumers.
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SUPERVALU INC.
JUNE 26, 1997 ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY.
The stockholder(s) named on this card hereby appoint Michael W. Wright and
Teresa H. Johnson, and each of them, as their proxy, with power of
substitution to vote at the Annual Meeting as directed below. The proxies may
also vote, in their discretion, upon all other matters that may properly come
before the Meeting, or any adjournment or adjournments thereof. The shares
will be voted as if the stockholder(s) were personally present at the meeting.
All former proxies are revoked. IF NOT OTHERWISE SPECIFIED, SHARES WILL BE
VOTED AS RECOMMENDED BY THE DIRECTORS.
. VOTING BY MAIL. If you wish to vote by mailing this proxy, please sign,
mark, date and return it in the enclosed postage-paid envelope.
. VOTING BY TELEPHONE. If you wish to vote by telephone, please follow the
instructions on the reverse side; if you vote by telephone you do not need
to return this proxy card. NOTE: If you wish to abstain from voting, or
choose to vote some proposals in favor and others against the Board of
Directors' recommendation, you must do so by signing the proxy card and
returning it in the postage-paid envelope provided.
. SUPERVALU EMPLOYEES. If you are a current or former employee of SUPERVALU
and have an interest in Common Stock through a SUPERVALU employee benefit
plan, your interest as of May 7, 1997 is shown on this card. Your vote will
provide voting instructions to the Trustees of the plans. If no instructions
are given, the Trustees will vote the shares pursuant to the terms of the
plans.
PLEASE MARK THIS PROXY AS INDICATED ON THE REVERSE SIDE TO VOTE ON ANY ITEM.
- ---------------------------------------------------------------------------
COMMENTS/ADDRESS CHANGE: PLEASE MARK COMMENT/ADDRESS BOX ON REVERSE SIDE.
--------------------------------------------
--------------------------------------------
--------------------------------------------
I PLAN TO ATTEND THE ANNUAL MEETING [_]
NUMBER OF STOCKHOLDERS ATTENDING [_]
If you choose to vote your proxy by
telephone, please DO NOT hang up until you
have been prompted and have replied
regarding your attendance at the Annual
Meeting.
- ---------------------------------------------------------------------------
(CONTINUED AND TO BE SIGNED ON OTHER SIDE.)
- --------------------------------------------------------------------------------
. Fold and Detach here .
SUPERVALU INC.
JUNE 26, 1997 ANNUAL MEETING OF STOCKHOLDERS
MINNEAPOLIS CONVENTION CENTER
1301 SECOND AVENUE SOUTH
MINNEAPOLIS, MN 55403
Free parking for the Annual Meeting of Stockholders is available in the
Plaza Parking Ramp and the Orchestra Hall Ramp. Upon entering either ramp,
take a parking ticket, sign your name on the back and tell the attendant you
are attending SUPERVALU's Annual Meeting. The Annual Meeting will begin at
10:30 a.m. in Ballroom A in the Minneapolis Convention Center. Refreshments
will be available before and after the Annual Meeting in Ballroom B.
[AREA MAP APPEARS HERE]
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
--------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
ITEMS 1, 2, 3, 4, AND 5
--------------------------------------------------
IF YOU VOTE BY TELEPHONE AS INSTRUCTED BELOW, THERE IS NO NEED TO MAIL BACK
YOUR PROXY CARD.
[X] Please mark your votes like this
ITEM 1. ELECTION OF DIRECTORS
Nominees: Lawrence A. Del Santo,
William A. Hodder and Harriet Perlmutter
FOR WITHHELD
ALL FOR ALL
[_] [_]
WITHHELD FOR: (Write nominee name(s) in the space provided)
-----------------------------------------------------------------------
ITEM 2. RATIFY APPOINTMENT OF INDEPENDENT AUDITORS
FOR AGAINST ABSTAIN
[_] [_] [_]
ITEM 3. AMENDMENT TO THE SUPERVALU 1993 STOCK PLAN
FOR AGAINST ABSTAIN
[_] [_] [_]
ITEM 4. AMENDMENT TO THE SUPERVALU 1983 EMPLOYEE STOCK OPTION PLAN
FOR AGAINST ABSTAIN
[_] [_] [_]
ITEM 5. AMENDMENT TO THE SUPERVALU LONG-TERM INCENTIVE PLAN
FOR AGAINST ABSTAIN
[_] [_] [_]
- ------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST THE STOCKHOLDER PROPOSAL IN
ITEM 6
- ------------------------------------------------------------------------------
ITEM 6. STOCKHOLDER PROPOSAL--PREFERRED SHARE PURCHASE RIGHTS
FOR AGAINST ABSTAIN
[_] [_] [_]
Signature(s) ___________________________________________________ Date __________
NOTE: Please date and sign exactly as name appears, indicating, if appropriate,
official position or capacity. If co-owners, both should sign.
- --------------------------------------------------------------------------------
. Fold and Detach here .
IF YOU WISH TO VOTE BY TELEPHONE PLEASE FOLLOW THE INSTRUCTIONS BELOW
We encourage you to take advantage of this convenient way to vote your Stock
for matters to be considered at the 1997 Annual Meeting of Stockholders of
SUPERVALU INC. If you wish to vote all proposals FOR or AGAINST the Board of
Directors' recommendation, please use the automated telephone voting system.
NOTE: If you wish to abstain from voting, or choose to vote some proposals in
favor and others against the Board of Directors' recommendation, you must do
so by signing the proxy card and returning it in the postage-paid envelope
provided.
. Have your proxy card in hand.
. Using a touch-tone telephone, dial 1-800-240-6326, 24 hours a day, 7 days a
week.
. When prompted, enter the three digit company number located on the proxy
card above your name and address.
. When prompted, enter your seven digit NUMERICAL Personal Identification
Number (PIN) that follows the company number. DO NOT ENTER the ALPHABETICAL
character.
. If you enter an invalid PIN, you will be prompted to re-enter your PIN. You
will have three opportunities to enter the correct PIN before the telephone
system will end the call.
. When prompted, press "1" to vote all proposals FOR the Board of Directors'
recommendations. Pressing "1" will result in a "YES" vote on proposals 1, 2,
3, 4 and 5, and a "NO" vote on proposal 6.
OR
Press "9" to vote all proposals AGAINST the Board of Directors'
recommendations. Pressing "9" will result in a "NO" vote on proposals 1, 2,
3, 4 and 5, and a "YES" vote on proposal 6.
. When prompted
--Press "1" if you plan to attend the Annual Meeting or
--Press "9" if you will not be attending the Annual Meeting
. A recorded voice will confirm your vote has been cast as you directed and
end the phone call.
YOU DO NOT HAVE TO MAIL BACK YOUR PROXY CARD
YOUR VOTE HAS BEEN RECORDED ELECTRONICALLY.
The deadline for electronic voting by telephone is 11:59 p.m. (CDT), Tuesday,
June 24, 1997.
THANK YOU FOR VOTING
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SUPERVALU INC.
JUNE 26, 1997 ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY.
The stockholder(s) named on this card hereby appoint Michael W. Wright and
Teresa H. Johnson, and each of them, as their proxy, with power of substitution
to vote at the Annual Meeting as directed below. The proxies may also vote, in
their discretion, upon all other matters that may properly come before the
Meeting, or any adjournment or adjournments thereof. The shares will be voted
as if the stockholder(s) were personally present at the meeting. All former
proxies are revoked. IF NOT OTHERWISE SPECIFIED, SHARES WILL BE VOTED AS
RECOMMENDED BY THE DIRECTORS.
PLEASE MARK THIS PROXY AS INDICATED ON THE REVERSE SIDE TO VOTE ON ANY ITEM.
- ---------------------------------------------------------------------------
COMMENTS/ADDRESS CHANGE: PLEASE MARK COMMENT/ADDRESS BOX ON REVERSE SIDE.
------------------------------------------
------------------------------------------
------------------------------------------
I PLAN TO ATTEND THE ANNUAL MEETING [_]
NUMBER OF STOCKHOLDERS ATTENDING [_]
- ---------------------------------------------------------------------------
(CONTINUED AND TO BE SIGNED ON OTHER SIDE.)
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
--------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
ITEMS 1, 2, 3, 4, AND 5
--------------------------------------------------
[X] Please mark your votes like this
ITEM 1. ELECTION OF DIRECTORS
Nominees: Lawrence A. Del Santo,
William A. Hodder and Harriet Perlmutter
FOR WITHHELD
ALL FOR ALL
[_] [_]
WITHHELD FOR: (Write nominee name(s) in the space provided)
----------------------------------------------------------------------
ITEM 2. RATIFY APPOINTMENT OF INDEPENDENT AUDITORS
FOR AGAINST ABSTAIN
[_] [_] [_]
ITEM 3. AMENDMENT TO THE SUPERVALU 1993 STOCK PLAN
FOR AGAINST ABSTAIN
[_] [_] [_]
ITEM 4. AMENDMENT TO THE SUPERVALU 1983 EMPLOYEE STOCK OPTION PLAN
FOR AGAINST ABSTAIN
[_] [_] [_]
ITEM 5. AMENDMENT TO THE SUPERVALU LONG-TERM INCENTIVE PLAN
FOR AGAINST ABSTAIN
[_] [_] [_]
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST THE STOCKHOLDER PROPOSAL IN
ITEM 6
- --------------------------------------------------------------------------------
ITEM 6. STOCKHOLDER PROPOSAL--PREFERRED SHARE PURCHASE RIGHTS
FOR AGAINST ABSTAIN
[_] [_] [_]
Signature(s) __________________________________________________ Date ___________
NOTE: Please date and sign exactly as name appears, indicating, if appropriate,
official position or capacity. If co-owners, both should sign.
- --------------------------------------------------------------------------------
