-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, B5NhEOCFr3J7m0L/sSz5Qzc9WHtXHnYBdKSS0DXaejPipYlvoc5pGl589VdpCiMD toOPbLQRjcbn4MtQ8MpJSg== 0000013573-05-000010.txt : 20051031 0000013573-05-000010.hdr.sgml : 20051031 20051031081349 ACCESSION NUMBER: 0000013573-05-000010 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20051028 FILED AS OF DATE: 20051031 DATE AS OF CHANGE: 20051031 EFFECTIVENESS DATE: 20051031 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BOWL AMERICA INC CENTRAL INDEX KEY: 0000013573 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-AMUSEMENT & RECREATION SERVICES [7900] IRS NUMBER: 540646173 STATE OF INCORPORATION: MD FISCAL YEAR END: 0627 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-07829 FILM NUMBER: 051164826 BUSINESS ADDRESS: STREET 1: 6446 EDSALL RD CITY: ALEXANDRIA STATE: VA ZIP: 22312 BUSINESS PHONE: 7039416300 MAIL ADDRESS: STREET 1: P O BOX 1288 CITY: SPRINGFIELD STATE: VA ZIP: 22151 DEF 14A 1 rproxy05.txt NOTICE OF ANNUAL MEETING AND PROXY STATEMENT FOR 12/6/05 BOWL AMERICA INCORPORATED NOTICE OF ANNUAL MEETING OF STOCKHOLDERS AND PROXY STATEMENTS NOTICE OF ANNUAL MEETING OF STOCKHOLDERS TO BE HELD DECEMBER 6, 2005 TO THE HOLDERS OF CLASS A AND CLASS B COMMON STOCK OF BOWL AMERICA INCORPORATED The annual meeting of stockholders of Bowl America Incorporated will be held at the Corporation's office situated at 6446 Edsall Road, Alexandria, Virginia 22312 (East Exit off Shirley Highway), on Tuesday December 6, 2005, at 11:00 a.m., for the following purposes: (1) To elect a Board of Directors to serve until the next annual meeting. (2) To transact such other business as may properly be brought before the meeting and any adjournments thereof. Only stockholders of record at the close of business October 26, 2005, are entitled to vote at the meeting. The stock transfer books will not be closed. You are cordially invited to attend the meeting in person. If you do not expect to be present, please sign, date, and mail the enclosed proxy, the postage for which has been provided. Prompt response is helpful, and your cooperation will be appreciated. If after signing and returning the enclosed proxy, you find you are able to attend the meeting, you will have an opportunity to withdraw your proxy and vote in person. By Order of the Board of Directors A. Joseph Levy Secretary Dated October 28, 2005 PROXY STATEMENT For Annual Meeting of Stockholders To be held December 6, 2005 The principal office of the Corporation is situated at 6446 Edsall Road, Alexandria, Virginia 22312. The accompanying proxy is solicited by the Board of Directors; and when such proxy is properly signed and returned, the shares it represents will be voted at the meeting in accordance with the directions noted thereon; or if no direction is indicated, it will be voted for the election of directors. Solicitation of proxies will be primarily by mail. Proxies may also be solicited by directors, officers, and employees of the Corporation personally or by telephone or telegraph. The Corporation will bear the cost of all such solicitations. The proxy may be revoked at any time prior to its exercise by giving notice of the revocation to the Secretary of the Corporation in writing at any time prior to the meeting and orally at the meeting at any time prior to the vote. This statement is being mailed on or about October 28, 2005. VOTING SECURITIES Each of the issued and outstanding 3,668,518 shares of the Corporation's Class A Common Stock, par value of $.10 per share, is entitled to one vote. Each of the issued and outstanding 1,468,462 shares of the Corporation's Class B Common Stock, par value of $.10 per share, is entitled to ten votes. The total number of Class A and Class B shares of Common Stock issued and outstanding is 5,136,980 shares, with the Class A stockholders having 3,668,518 votes, and the Class B stockholders having 14,684,620 votes. The price of the Corporation's Class A Common Stock on October 5, 2005, on the American Stock Exchange was $13.58. The Class B Common Stock is not traded. Only stockholders of record at the close of business on October 26, 2005, are entitled to vote at the meeting and adjournment thereof. The Class A Common Stockholders are entitled to elect two directors and the Class B Common Stockholders are entitled to elect six directors. Votes cast by proxy or in person at the Annual Meeting will be tabulated by tellers appointed by the Company. The number of shares represented at the meeting in person or by proxy, including abstentions, will determine whether or not a quorum is present. Abstentions will not be voted on any matter submitted to the stockholders for a vote. Shares on a Broker's Proxy that lack discretionary authority to vote on a particular matter will not be considered as present and entitled to vote by the tellers. ANNUAL REPORTS A copy of the annual report and Form 10-K of the Corporation for the fiscal year ending July 3, 2005, which has been filed with the Securities and Exchange Commission, was mailed to you on September 29, 2005 or is enclosed with this statement. ELECTION OF DIRECTORS AND SECURITY OWNERSHIP OF MANAGEMENT The holders of the Class A Common Stock are entitled to elect two Directors of the Corporation and the holders of the Class B Common Stock are entitled to elect six Directors of the Corporation to hold office until the next Annual Meeting of the stockholders and until their successors shall have been elected and qualified. The management recommends the election of the nominees listed below as Directors. All of the nominees are presently Directors and constituted the Board of Directors for the past year. In the event any of these nominees becomes unavailable for election, it is intended that the proxies will be voted for the election of such other persons as management shall designate. Management has no reason to believe that any nominee will be unavailable. The following table also shows the beneficial ownership of shares of the Corporation's Class A and Class B Common stock as of October 5, 2005 by all directors including executive officers, all of whom are directors, and by all directors and executive officers as a group. Percentage of Total Shares of Class A Shares of Class B Votes Eligible to be Common Stock of Common Stock of Cast of Class A & B Name of Director and Nominees Corporation Corporation Common Stock for Election; Principal Occupation; Beneficially Owned Beneficially Owned Beneficially Owned Positions and Offices with the Periods Served Directly or Indirectly Directly or Indirectly Directly or Indirectly Corporation Age As a Director on October 5, 2005 on October 5, 2005 on October 5, 2005
NOMINEES FOR ELECTION BY CLASS A COMMON STOCK Warren T. Braham, Retired Attorney 73 August 1, 1978 1,978 247 .02 to date Allan L. Sher, Retired Senior 73 February 5, 1997 52,500 0 .28 Executive of Securities Brokerage to date Industry
NOMINEES FOR ELECTION BY CLASS B COMMON STOCK Merle Fabian, Retired Librarian 67 March 20, 1990 381,224 380,730 22.8 to date Leslie H. Goldberg, President of 75 December 5, 1972 498,239 491,296 29.5 the Corporation since February 1, 1976 to date Stanley H. Katzman, Retired Senior 65 December 2, 1997 195,502(1) 189,444(1) 11.4 Computer Specialist, National to date Institutes of Health A. Joseph Levy, Retired Merchant; 71 June 21, 1988 94,680(2) 53,945(2) 3.4 Senior Vice President and Secretary to date of the Corporation since December 2,1997 Ruth E. Macklin, Retired Educator; 76 February 14, 1978 184,585(3) 183,407(3) 11.0 Senior Vice President and to date Treasurer of the Corporation since December 4, 1990 Irvin Clark, General Manager 72 December 1, 1998 16,355(4) 0 .09 of the Corporation since to date January 1, 1999(5) All Directors and Executive Officers as a group 1,425,063 1,299,069 78.5
(1) Includes 181,396 shares each of Class A and Class B Common Stock held by Mr. Katzman as co-trustee. (2) The shares of stock are owned by the Levy Family LTD Partnership. (3) Includes 71,923 shares of Class A and 70,784 shares of Class B Common Stock held by Ms. Macklin as co-trustee. (4) Includes 1,011 shares of Class A held by Mr. Clark's wife. (5) Prior to 1999, Mr. Clark served as Director of Operations for Bowl America Inc. There is sole disposition and voting power of all the shares directly owned by the directors, and sole disposition and voting power of the shares held by the directors' respective spouses are vested in such spouses. Mr. Allan L. Sher is an outside director and trustee of three of Sun America's Mutual Funds. Mr. Leslie H. Goldberg and Ms. Merle Fabian are brother and sister. Together they own directly or indirectly 879,463 shares of Class A Common Stock and 872,026 shares of Class B Common Stock of the Corporation. As of the last filing of Form 13-G with the Securities and Exchange Commission, Royce & Associates, LLC, an investment advisor, is deemed to have beneficial ownership of 230,400 shares of Bowl America Class A Common Stock as of December 31, 2004 which amounts to 6.28% of the outstanding Class A Common Stock. Dimensional Fund Advisors Inc. ("Dimensional"), a registered investment advisor, is deemed to have beneficial ownership of 190,895 shares of Bowl America Incorporated Class A Common Stock as of December 31, 2004 which amounts to 5.2% of the outstanding Class A Common Stock, all of which shares are held in portfolios of DFA Investment Dimensions Group Inc., a registered open-end investment company, or a series of the DFA Investment Trust Company, a Delaware business trust, or the DFA Group Trust and DFA Participation Group Trust, investment vehicles for qualified employee benefit plans, for all of which Dimensional Fund Advisors Inc. serves as investment manager. Dimensional disclaims beneficial ownership of all such shares. Under federal securities law, the Corporation's directors, certain officers, and persons holding more than ten percent of any class of the Corporation's common stock are required to report, within specified due dates, their initial ownership in any class of the Corporation's common stock and all subsequent acquisitions, dispositions, or other transfers of interest in such securities, if and to the extent reportable events occur which require reporting by such due dates. The Corporation is required to describe in this proxy statement whether it has knowledge that any person required to file such a report may have failed to do so in a timely manner. In this regard, all of the Corporation's directors and officers satisfied such filing requirements. The foregoing is based upon written representations and information provided to the Corporation by the persons required to make such filings. COMPENSATION OF DIRECTORS AND OFFICERS The Directors of the Corporation who are not officers receive a fee for attendance at each Board of Directors meeting. During the past fiscal year the fee was $1,150.00 for each meeting. In addition, members of the audit and compensation committee receive $850.00 per committee meeting attended, except the committee chairman, who receives an annual fee of $15,000. The Corporation's Employment Agreement with Mr. Leslie H. Goldberg (75 years old) dated June 27, 2004 expired July 3, 2005 and was extended to the end of the next fiscal year. This agreement provides for an annual salary of $102,000 with an annual bonus of 2% of the Corporation's and its subsidiaries' consolidated annual net income prior to income taxes, in excess of $2,500,000. In the event that he leaves the employ of the Corporation at the termination of the contract or becomes disabled during the term thereof so that he cannot carry on his duties as President, he shall act as a consultant and shall receive one-half the average of his previous three years compensation for a term equal to the number of years that he had been President of the Corporation. The Corporation's Employment Agreement with Mr. Irvin Clark (72 years old) as General Manager is for a term of one year commencing January 1, 2005 and expiring on December 31, 2005. This agreement provides for an annual salary of $170,000.00. The other executive officers of the Corporation are A. Joseph Levy (Senior Vice President and Secretary), 71 years old, and Ms. Macklin (Senior Vice President and Treasurer), 76 years old. Both are major stockholders. CORPORATE GOVERNANCE AND BOARD MATTERS American Stock Exchange Corporate Governance Provisions Because approximately 52.3% of the total voting power of the outstanding Class A and Class B Common Stock of the Company is owned by Leslie H. Goldberg, President and a director of the Company, and his sister, Merle Fabian, a director of the Company, the Company is deemed to be a "controlled company" (i.e., more than 50% of the total voting power is held by an individual or group) under the rules of the American Stock Exchange. The exchange's listing rules provide that "controlled companies" are exempt from those exchange corporate governance provisions that would otherwise call for (i) a majority of the members of the Board of Directors to be independent, (ii) the process of making director nominations to be overseen by independent directors and (iii) executive compensation determinations to be overseen by independent directors. Of the Company's eight directors, Messrs. Braham, Sher and Katzman are deemed to be "independent" directors. None of the independent directors receive compensation from the Company other than directors' fees for service on the Board or its Committees. Code of Business Conduct and Ethics for Directors, Officers and Employees The Company has a Code of Business Conduct and Ethics for directors, officers and employees in accordance with rules of the Securities and Exchange Commission and the American Stock Exchange. A copy is available online at www.bowlamericainc.com and will be provided to any stockholder upon written request to the Secretary of the Corporation, 6446 Edsall Road, Alexandria VA 22312. Policy Regarding Stockholder Communication with Directors Those properly identified as stockholders desiring to communicate with a director, the independent directors as a group or the full Board may address such communication to the attention of the Secretary of the Corporation at the Company's executive offices, and such communication will be forwarded to the intended recipient or recipients. Director Nomination Process The Company's Board of Directors does not have a nominating committee or other committee that performs similar functions. As stated above, the Company is exempt from the American Stock Exchange provision calling for independent director oversight of director nominations in view of its status as a controlled company. All members of the Company's Board of Directors as a group participate in the consideration of director nominees. Any stockholder may nominate a candidate for the Board of Directors. Currently, this can be done at the Annual Meeting when candidates properly seconded by a stockholder will be voted on. The Board of Directors proposes in the Proxy Statement a slate of directors which is decided upon by the Board at its September meeting. Any person wishing to propose a substitute director to be considered by the Board for inclusion in the Company's Proxy Statement may do so in writing, for receipt prior to September 1, to the Board at the address of the Company's principal executive offices. The Board members individually make their judgment as to the nominees' ability to contribute to the survival and success of the Company. There will not be any difference between the manner in which the Board evaluates a nominee recommended by a stockholder and the manner in which the Board evaluates any other director nominee. Board Committees and Meetings The Board of Directors has an Audit Committee and Compensation Committee, each of which consists of Warren T. Braham, Chairman, Allan L. Sher and Stanley H. Katzman. Messrs. Braham, Sher and Katzman each is an "independent" director within the meaning of the rules of the Securities and Exchange Commission and the American Stock Exchange. The Board of Directors, which meets quarterly, met 4 times during the fiscal year ended July 3, 2005. Each director attended all of such meetings. The Audit Committee and the Compensation Committee, which occasionally meet in joint session, held 4 meetings and 2 meetings, respectively, during the fiscal year with full attendance at each meeting. The Company has a policy of encouraging directors to attend each Annual Meeting of Stockholders. All of the Company's directors attended the Annual Meeting held on December 7, 2004. Independent members of the Board of Directors conduct meetings on a regular basis, including at least annually in executive session without the presence of non-independent directors and management. The Audit Committee The purpose of the Audit Committee of the Board of Directors of Bowl America Inc. (the "Company") is to assist the Board in its oversight of the integrity of the Company's financial statements, the Company's compliance with legal and regulatory requirements, the independent auditor's qualifications, independence and performance and the performance of the Company's internal audit function. The Audit Committee is composed entirely of independent directors as determined under the SEC and the American Stock Exchange corporate governance standards and the Sarbanes-Oxley Act applicable to Audit Committee members. The Chairman of the Audit Committee is Mr. Warren Braham. The two other members are Mr. Allan Sher and Mr. Stanley Katzman. Each of the members is financially literate, independent and able to devote sufficient time to serve on the Audit Committee. The Board has determined that Mr. Sher possesses the qualifications of an audit committee financial expert as defined in SEC rules adopted pursuant to the Sarbanes-Oxley Act. A copy of the Audit Committee Charter is available at www.bowlamericainc.com and will be provided upon request to the Secretary of the Corporation, 6446 Edsall Road, Alexandria VA 22312. The Compensation Committee The Compensation Committee has the responsibility for negotiating the compensation of the President, Leslie H. Goldberg, who is the Chief Executive Officer of the Corporation. The President is responsible for determining the compensation of the other executive officers and all other management employees. The Chairman of the Compensation Committee is Mr. Warren Braham and the two other members are Mr. Allan Sher and Mr. Stanley Katzman, all of whom are independent directors. AUDIT COMMITTEE REPORT ON FINANCIAL STATEMENTS The Audit Committee met with senior management and the independent auditors quarterly during fiscal 2005 to discuss the adequacy of disclosure controls and procedures, the adequacy of the Company's internal controls and the certifica- tions made by the Company's Chief Executive Officer and Chief Financial Officer that are required by the SEC. The Audit Committee: (1) reviewed and discussed with management Bowl America's audited financial statements for the year ended July 5, 2005, (2) discussed with the independent auditors the matters required by Statement on Auditing Standards No. 61, "Communication with Audit Committees", (3) received the written disclosures and the letter from the independent auditors required by Independence Standards Board Standard No. 1, "Independence Discussions with Audit Committees"; (4) considered whether the provision of non-audit services is compatible with maintaining the auditors' independence, and (5) discussed with the auditors the auditors' independence. Based on the review and discussion, the Audit Committee recommended to the Board of Directors that the audited financial statements for the year ended July 3, 2005, be included in Bowl America Incorporated's Annual Report on Form 10-K for filing with the Securities and Exchange Commission. COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION The following table shows the compensation received by the President, who is the Chief Executive Officer, for the three fiscal years ending July 3, 2005. The other executive officers, namely A. Joseph Levy, Senior Vice President and Secretary and Ruth E. Macklin, Senior Vice President and Treasurer receive com- pensation of less than $100,000 per year. In fiscal 2005, A. Joseph Levy and Ms. Macklin each received compensation of $8,500 for the fiscal year. There are no restricted stock awards, no stock option grants and no stock appreciation rights. There is no pension plan.
SUMMARY COMPENSATION TABLE ANNUAL COMPENSATION LONG-TERM COMPENSATION (1) (2) (3) (4) (5) (6) (7) (8) (9) Name and Other Restricted Principal Fiscal Annual Stock Options/ LTIP All Other Position Year Salary Bonus Compensation Awards SAR's(#) Payouts Compensation Leslie Goldberg, 2005 $102,000 $ 98,622 $ 9,905 $0 0 $0 $0 President and 2004 $102,000 $ 61,907 $10,171 $0 0 $0 $0 Chief Executive 2003 $102,000 $ 69,708 $ 9,041 $0 0 $0 $0 Officer
The Compensation Committee, in negotiating the President's compensation, takes into account his performance and his contribution to the Company's functions. The Committee thought it important that there be an incentive which is accomplished by a bonus based on the income of the Corporation. The terms of the President's current contract are the same as the terms of his prior contract. The President does not participate in the Profit Sharing Plan or in the Employee Stock Ownership Plan. AUDIT FEES AND AUDIT COMMITTEE PRE-APPROVAL PRACTICES The Audit Committee has voted to engage Aronson & Company as independent auditors to examine the financial statements of the Company for the fiscal year ending July 2, 2006. Aronson & Company's report on Bowl America's consolidated financial state- ments as of July 3, 2005 and June 27, 2004, did not contain any adverse opinion or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope, or accounting principles. During the fiscal years ended July 3, 2005 and June 27, 2004, there were no disagreements between Bowl America and Aronson & Company or between Bowl America and Deloitte & Touche LLP on any matter of accounting principles and practices, financial statement disclosure, or auditing scope or procedures. AUDIT FEES - For professional services rendered for the audit of the Company's annual financial statements and reviews of quarterly financial statements included in the Company's Forms 10-Q during the fiscal year ended July 3, 2005, Aronson & Company billed Bowl America $89,380 and Deloitte & Touche LLP billed $6,540, and for fiscal year ended June 27, 2004, Aronson & Company billed the Company $61,600 and Deloitte & Touche LLP billed $12,000. These fees include consultations normally provided in relation to the annual audits and reviews of documents filed with the SEC. AUDIT-RELATED FEES - There were no additional audit-related services provided by principal accountants Aronson & Company in fiscal years ended July 3, 2005 and June 27, 2004. TAX FEES - For professional services rendered to Bowl America, Aronson & Company billed $24,590 for fiscal year ended July 3, 2005 and $19,000 for the fiscal year ended June 27, 2004. Tax services generally include federal and state compliance. ALL OTHER FEES - In addition to the fees described above, Aronson & Company billed $2,500 in fiscal yeat 2005 and Deloitte & Touche LLP billed $2,200 in fiscal year 2004 for reviews required by non-regulatory bodies and Aronson & Company billed $3,400 for other planning services. The Audit Committee pre-approved all of the services described above. The Board of Directors and its Audit Committee have considered all of the professional services rendered by its auditor, Aronson & Company and by its former auditor Deloitte & Touche LLP, and were of the opinion that these services had no effect on the independence of said accounting firms. The Audit Committee, prior to authorizing such firms to provide any non-audit services. determined that such services would have no effect on the independence of said accounting firm. A representative of Aronson & Company is expected to attend the Annual Meeting and will be given the opportunity to make a statement and respond to appropriate questions. Neither Aronson & Company nor Deloitte & Touche LLP is or has been financially interested in the Company or connected with it except as auditors, tax consultants and advisors. AUDIT COMMITTEE POLICIES AND PROCEDURES FOR PRE-APPROVAL OF INDEPENDENT AUDITOR SERVICES - The following describes the Audit Committee's policies and procedures regarding pre-approval of the engagement of the Company's independent auditor to perform audit as well as permissible non-audit services for the Company. For audit services, the independent auditor will provide the Committee with an engagement letter during the first quarter of each fiscal year outlining the scope of the audit services proposed to be performed in connection with the audit of the fiscal year. If agreed to by the Committee, the engagement letter will be formally accepted by the Committee at an Audit Committee meeting held as practicably as possible following receipt of the engagement letter. The independent auditor will submit to the Committee for approval, an audit services fee proposal after acceptance of the engagement letter. For non-audit services, the Company management may submit to the Committee for approval the list of non-audit services that it recommends the Committee engage the independent auditor to provide for the fiscal year. The list of services must be detailed as to the particular service and may not call for broad categorical approvals. Company management and the independent auditor will each confirm to the Committee that each non-audit service on the list is permissible under all applicable legal requirements. In addition to the list of planned non-audit services, a budget estimating non-audit service spending for the fiscal year may be provided. The Committee will consider for approval both the list of permissible non-audit services and the budget for such services. The Committee will be informed routinely as to non-audit services actually provided by the independent auditor pursuant to this pre-approval process. The independent auditor must ensure that all audit and non-audit services provided to the Company have been approved by the Committee. The Chief Financial Officer of the Company will be responsible for tracking all independent auditor fees against the budget for such services and report annually to the Audit Committee. SHAREHOLDER RETURN PERFORMANCE PRESENTATION The following graph shows changes over the past five fiscal year periods in the value of $100 invested in (1) Bowl America Incorporated Class A Common Stock, (2) the American Stock Exchange Market Index, and (3) the Peer Group consisting of 15 companies in the business Industry Group No.715, Sporting Activities. It is assumed that all dividends were reinvested.
COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN AMONG BOWL AMERICA INC., AMEX MARKET INDEX AND PEER GROUP INDEX FISCAL YEAR ENDING COMPANY 2000 2001 2002 2003 2004 2005 BOWL AMERICA INC. 100 139.27 166.18 179.42 226.18 230.43 AMEX MARKET INDEX 100 89.64 70.95 76.96 98.84 111.76 PEER GROUP INDEX 100 106.15 93.95 84.53 98.53 105.53
PROFIT SHARING PLAN The Board of Directors adopted a profit sharing plan for its employees which became effective on June 29, 1975, and which has been approved by the Internal Revenue Service. The following table shows the name of each person named in the preceding table and shows for each named person and for all of the Directors and Officers of the Corporation as a group, the amount allocated to their accounts in trust from the contributions of the Corporation for the fiscal year ending July 3, 2005 under its employees' profit sharing plan in Column (B), from contributions since the inception of the plan in Column (C), and from other accruals under the plan in Column (D), which accruals consist of a share of forfeitures resulting from employees covered by the plan who leave the Corpor- ation's employment and interest on plan investments.
A B C D Leslie H. Goldberg -0- $ 82,390 $447,343 Irvin Clark $2,579 58,069 185,188 All Directors and Officers including the one named above and Director Irvin Clark $2,579 $140,459 $632,531
Directors as such do not participate in the Corporation's employee profit sharing plan. All employees, including officers of the Corporation, are eligible to commence participation under the Plan after completing a minimum of 1,000 hours continuous employment during the Corporation's fiscal year. Actual payment of accounts to participants or their beneficiaries is deferred until retirement, disability, or death. In the event of termination of employment, the vested portion, if any, is paid. Accounts become vested after three years of service according to a graduated scale until 100% is vested after seven years of service. No estimate can be made of the annual benefits on the retirement of a particular person because the amount set aside each year depends on the earnings of the Corporation for such year. The amount of the contribution is within the discretion of the Corporation's Board of Directors and can only be paid from profits. The Board of Directors made a contribution of $150,000 including any expenses incurred by the Trust paid by the Corpora- tion for the fiscal year 2004. The contribution is made to a trust (Bowl America Incorporated Profit Sharing Trust). Contributions of the Corporation to the trust and forfeitures of terminated members are allocated in proportion to compensation paid by the Corporation. Employees exercise independent control over the investment of funds allocated in their accounts. Earnings or losses are posted to the accounts daily. Employees may change their investment choices at any time. No Executive Officer or Director except Irvin Clark presently receives an allocation under the plan. 1987 EMPLOYEE STOCK OWNERSHIP PLAN The Board of Directors adopted the Bowl America Incorporated 1987 Employee Stock Ownership Plan (the "ESOP") on March 31, 1987, and secured a satisfactory ruling from the Internal Revenue Service. All employees of the Corporation and certain subsidiaries become participants on the last day of the fiscal year or December 31 following the date on which they have been employed for one year with at least 1,000 hours of service. The Board of Directors of the Corpora- tion has the discretion to declare each year a cash amount or a specified number of shares of Class A Common Stock ("Common Stock") that will be contri- buted to the ESOP. On June 21, 2005, the Board of Directors made a contribution valued at $150,000 including any expenses incurred by the Plan which were paid by the Corporation for fiscal year 2005. Corporation contributions are allocated to employees who are participants on the last day of the fiscal year through a formula based upon the participant's compensation. Employee contributions to the ESOP are not permitted. The trustees of the ESOP, Donald Armel and Michael Dick, have the exclusive authority to manage the trust in which ESOP contributions are deposited and are obligated to invest the cash portion of ESOP contributions primarily in the Corporation's Common Stock. The trustees are permitted to borrow money to purchase Common Stock for the trust. As of the last day of the fiscal year, eligible participants are credited with their proportionate share of the trust's assets. A participant's interest vests and is nonforfeitable if while employed by the Corporation or participating subsidiaries he or she attains at least 65 years of age, becomes totally or permanently disabled or dies. Also, a participant's interest vests and is nonforfeitable to the extent and in the percentage set forth in a schedule in the ESOP. Under this schedule, a participant's interest is 100 percent vested after seven years of service. Vested amounts are distributed upon retirement, disability, or death. If termination of service occurs prior to the occurrence of those events, payment may be made or deferred until the participant attains age 65. As determined by the participant, distributions are made in cash or Common Stock. The Corporation may terminate or amend the ESOP but not in such a way as would adversely affect any participant's vested benefits. The trustees have the right to vote the Common Stock in the trust subject to the direction of each participant with respect to the shares allocated to his or her account. As of the end of fiscal 2005, there were 675 participants in the ESOP. No Executive Officer or Director except Irvin Clark participates in the Plan. PROPOSALS OF SECURITY HOLDERS Proposals of stockholders intended to be presented at the 2006 Annual Meeting, which presently is expected to be held in December 2006, must be received by the Secretary of the Corporation, 6446 Edsall Road, Alexandria, Virginia 22312 no later that July 3, 2006, in order for them to be considered for inclusion in the October 2006 Proxy Statement. A stockholder desiring to submit a proposal to be voted on at the next year's Annual Meeting, but not desiring to have such proposal included in next year's Proxy Statement relating to that meeting, should submit such proposal to the Company by September 13, 2006. Failure to comply with that advance notice requirement will permit management to use its discretionary voting authority if and when the proposal is raised at the Annual Meeting without having had a discussion of the proposal in the Proxy Statement. OTHER MATTERS Management does not intend to bring any other matters before the meeting and does not know of any other matters to be brought before the meeting by any others. If any other matter should come before the meeting, it is the intention of the persons named in the accompanying proxy to vote the proxy in accordance with their best judgment. By Order of the Board of Directors A. Joseph Levy Secretary
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