-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, I6FZDrNXnhP3F5ReUxrI/8w9lGsCBydXunbRvlr9uEPmAPYlacfsoL3jkAM9EisU 77xBSwsv8L/naSQw1NqKmQ== 0000912057-94-000900.txt : 19940315 0000912057-94-000900.hdr.sgml : 19940315 ACCESSION NUMBER: 0000912057-94-000900 CONFORMED SUBMISSION TYPE: DEFA14A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19940314 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FLEMING COMPANIES INC /OK/ CENTRAL INDEX KEY: 0000352949 STANDARD INDUSTRIAL CLASSIFICATION: 5140 IRS NUMBER: 480222760 STATE OF INCORPORATION: OK FISCAL YEAR END: 1227 FILING VALUES: FORM TYPE: DEFA14A SEC ACT: 34 SEC FILE NUMBER: 001-08140 FILM NUMBER: 94515854 BUSINESS ADDRESS: STREET 1: 6301 WATERFORD BLVD STREET 2: P O BOX 26647 CITY: OKLAHOMA CITY STATE: OK ZIP: 73126 BUSINESS PHONE: 4058407200 DEFA14A 1 DEFA14A 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 /X/ Definitive Proxy Statement / / Definitive Additional Materials / / Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12 FLEMING COMPANIES, INC. - -------------------------------------------------------------------------------- (Name of Registrant as Specified in its Charter) FLEMING COMPANIES, INC. - -------------------------------------------------------------------------------- (Name of Person(s) Filing Proxy Statement) Payment of Filing Fee (Check the appropriate box): / / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2). / / $500 per each party to the controversy pursuant to Exchange Act Rule 14a-6(i)(3). / / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. 1) Title of each class of securities to which transaction applies: N/A ------------------------------------------------------------------------ 2) Aggregate number of securities to which transaction applies: N/A ------------------------------------------------------------------------ 3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11(1): N/A ------------------------------------------------------------------------ 4) Proposed maximum aggregate value of transaction: N/A ------------------------------------------------------------------------ (1) Set forth the amount on which the filing fee is calculated and state how it was determined. /X/ 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: $125.00 ------------------------------------------------------------------------ 2) Form, Schedule or Registration No.: Schedule 14A ------------------------------------------------------------------------ 3) Filing Party: Fleming Companies, Inc. ------------------------------------------------------------------------ 4) Date Filed: March 11, 1994 ------------------------------------------------------------------------ 6301 WATERFORD BOULEVARD P.O. BOX 26647 OKLAHOMA CITY, OKLA. 73126-0647 LOGO - ------------------------------------------------------------------------------ NOTICE OF ANNUAL MEETING Dear Shareholder: You are cordially invited to attend the annual meeting of shareholders of Fleming Companies, Inc. on Wednesday, April 27, 1994, at 10:00 a.m. at the Marriott Hotel, 3233 N.W. Expressway, Oklahoma City. The meeting is being held for the following purposes: 1. To elect one director for a term expiring in 1995 and three directors for terms expiring in 1997. 2. To ratify the appointment of Deloitte & Touche as independent auditors for 1994. 3. To transact other business as may properly come before the meeting or any adjournment. The accompanying proxy statement contains complete details on the proposals and other matters. Shareholders of record as of March 1, 1994, are entitled to notice of, and to vote at, the meeting. The company's annual report, including financial statements for the year ended December 25, 1993, is also enclosed. We hope you can be with us for this year's meeting. Your participation in the affairs of the company is important, regardless of the number of shares you hold. To ensure your representation at the meeting whether or not you are able to be present, please complete and return the enclosed proxy card as soon as possible. By Order of the Board of Directors DAVID R. ALMOND SENIOR VICE PRESIDENT GENERAL COUNSEL AND SECRETARY Oklahoma City, March 14, 1994 LOGO - ------------------------------------------------------------------------------ PROXY STATEMENT This proxy statement, which is being mailed to shareholders on or about March 14, 1994, is furnished in connection with the solicitation of proxies by the board of directors for use at the annual meeting of shareholders on April 27, 1994, including any adjournments. The annual meeting is called for the purposes stated in the accompanying notice. All holders of the company's $2.50 par value common stock as of March 1, 1994, are entitled to vote. As of that date, 37,154,432 shares were outstanding. On each matter coming before the meeting, a shareholder is entitled to one vote for each share of stock held as of the record date. If a proxy is properly signed and is not revoked by the shareholder, the shares it represents will be voted according to the instructions of the shareholder. If no specific instructions are given, the shares will be voted as recommended by the board of directors. A shareholder may revoke his or her proxy any time before it is voted at the meeting. Any shareholder who attends the meeting and wishes to vote in person may revoke his or her proxy then. Otherwise, a shareholder must advise the senior vice president -- general counsel and secretary in writing of revocation of his or her proxy. The company will bear the cost of solicitation of proxies. Solicitations will be made primarily by mail, but certain officers or associates of the company may solicit proxies by telephone without additional compensation. ELECTION OF DIRECTORS The company's certificate of incorporation provides that members of the board of directors will be divided into three classes with staggered three-year terms. The certificate requires that at each annual meeting, successors to directors whose terms expire at that meeting will be elected for three-year terms. At its June 1993 meeting, the board of directors increased the number of directors from 10 to 12 and elected Carol B. Hallett and Robert E. Stauth to fill the vacancies created, each for terms expiring at the annual meeting. At its February 1994 meeting, the board of directors decreased the number of directors from 12 to 11 effective with the annual meeting when R.D. Harrison will retire from the board of directors upon expiration of his current term. Four directors' terms will expire in 1995, four in 1996 and three in 1997. 2 The board of directors has nominated three persons, including Mrs. Hallett, for election as directors to serve for three-year terms expiring in 1997 and has nominated Mr. Stauth for election as a director to serve for a one-year term expiring in 1995, or until their successors are elected and qualified. All nominees are currently serving as directors and have consented to serve for the new terms. The board of directors unanimously recommends a vote FOR the election of each nominee. The persons named on the accompanying proxy card intend to vote in favor of the four nominees listed below. Should any one or more of these nominees become unavailable for election, the proxy will be voted for substitute nominees. The election of directors requires a plurality of the votes cast at the meeting. If all nominees are elected, the board will be comprised of 11 members, of which nine are nonmanagement directors and two are officers of the company. The office of the corporate secretary tabulates all votes received before the date of the annual meeting. The company appoints two inspectors of election to receive the tabulation, tabulate all other votes and certify the results of all matters voted upon. Neither the corporate law of the State of Oklahoma, the state in which the company is incorporated, nor the company's certificate of incorporation or bylaws has any specific provisions regarding the treatment of abstentions and broker non-votes. It is the company's policy to count abstentions and broker non-votes for purposes of determining the presence of a quorum at the meeting. The company's bylaws provide that the ratification of the appointment of auditors requires approval by the holders of a majority of the stock having voting power present at the meeting. Therefore, an abstention or broker non-vote will have no effect on the outcome of the election of directors and will have the same effect as a vote against the ratification of the appointment of the auditors. NOMINEE FOR DIRECTOR TERM EXPIRING IN 1995
Nominee (age), year first became a director [PHOTO] ROBERT E. STAUTH (49), 1993 President and chief executive officer. Effective with the annual meeting, he will become chairman. Mr. Stauth has been associated with Fleming for a total of 21 years. He first joined the company in 1966, and after leaving for a few years to serve in senior management positions at two retail chains, he rejoined the company in 1977. In 1987, Mr. Stauth was elected vice president, serving at the Phoenix division. In 1991, he was promoted to senior vice president -- Western Region, and in 1992 was named executive vice president -- division operations. In April 1993, Mr. Stauth was named president and chief operating officer. He was elected to the board the following June. In October of the same year, Mr. Stauth became the chief executive officer. He is a director of the Independent Grocers' Alliance and of the National-American Wholesale Grocers Association. Mr. Stauth also serves on the ECR committee of the Food Marketing Institute.
3 NOMINEES FOR DIRECTOR TERMS EXPIRING IN 1997 [PHOTO] R. RANDOLPH DEVENING (52), 1980 Vice chairman and chief financial officer. Mr. Devening has been associated with Fleming for a total of 12 years. He first joined the company in 1979 and was elected a director the following year. Mr. Devening left Fleming in 1987 to serve as vice president and chief financial officer of Genentech, Inc. He returned to Fleming in 1989 as executive vice president and chief financial officer. He assumed his current position in 1993. He is also a director of Arkwright Mutual Insurance Co. and The Fred Jones Companies. [PHOTO] CAROL B. HALLETT (56), 1993 Senior government relations advisor with Collier, Shannon, Rill & Scott, Washington, D.C., and Associate of Clark Company, Paso Robles, CA. Prior to joining Clark Company and Collier, Shannon, Rill & Scott in February 1993, Mrs. Hallett served as Commissioner of United States Customs from November 1989 through January 1993. Mrs. Hallett served briefly as a senior consultant to The Carmen Group in Washington, D.C. after her service as the U.S. Ambassador to The Commonwealth of the Bahamas from September 1986 to May 1989. Mrs. Hallett also served three terms in the California legislature and as minority leader in the State Assembly. Mrs. Hallett is a director of Litton Industries, Inc., Radix Group International, and the American Association of Exporters and Importers. She is a trustee for the Junior Statesmen of America and the United States Naval Institute. Mrs. Hallett also serves on the President's Cabinet of California Polytechnic State University, San Luis Obispo, CA and the Defense Advisory Committee on Women in the Services for the Department of Defense. Member of the audit and finance committee and nominating committee. [PHOTO] LAWRENCE M. JONES (62), 1972 Retired chairman of the board of directors and chief executive officer, The Coleman Co., Inc. (manufacturer of outdoor recreational products and associated equipment). Mr. Jones served for 18 months as Fleming's vice chairman and chief financial officer before rejoining Coleman in 1989. Mr. Jones continues to serve on the board of The Coleman Co., Inc. and is a director of Fourth Financial Corp. and Union Pacific Corp. Member of the audit and finance committee and nominating committee.
4 DIRECTORS WHOSE TERMS EXPIRE IN 1995 [PHOTO] ARCHIE R. DYKES (63), 1981 Chairman and chief executive officer of Capital City Holdings, Inc. (a venture capital organization). Mr. Dykes also serves as chairman of Education Corp. of America (educational management company). He is a director of Whitman Corp., Bradford Capital Partners and Pet Inc. A former chancellor of the University of Kansas, Mr. Dykes also serves as a trustee of the Kansas University Endowment Association and of the William Allen White Foundation. Chairman of the audit and finance committee and member of the nominating committee. [PHOTO] JOHN A. McMILLAN (62), 1992 Co-chairman of the board of Nordstrom, Inc. (specialty store chain). Mr. McMillan has been associated with Nordstrom for 35 years, and has served as a member of the office of chief executive officer since 1971. He was named co-chairman of the board in 1991. He is a member of the board of trustees of Seattle University and serves on the Seattle Center Advisory Committee. Member of the compensation and organization committee and the nominating committee. [PHOTO] GUY A. OSBORN (58), 1992 Chairman and chief executive officer of Universal Foods Corp. He joined that company in 1971, became president in 1984 and chairman in 1990. He serves on the boards of First Star Corp. (a bank holding company), First Star Bank of Milwaukee, Wisconsin Gas Co., WICOR, Inc. (a utility holding company), Milwaukee Metropolitan Association of Commerce, Boys and Girls Club of Greater Milwaukee, Greater Milwaukee Committee and Alverno College. Member of the audit and finance committee and the nominating committee.
5 DIRECTORS WHOSE TERMS EXPIRE IN 1996 [PHOTO] JAMES G. HARLOW, JR. (59), 1977 Chairman, president and chief executive officer of Oklahoma Gas & Electric Co. Mr. Harlow has been associated with this electric utility company since 1961 and has served as chairman since 1982. Mr. Harlow is a director of Massachusetts Mutual Life Insurance Co. and was chairman of Edison Electric Institute in 1991. He is chairman of the board of trustees of the University of Oklahoma Foundation and is a trustee of Oklahoma City University. Chairman of the compensation and organization committee and member of the nominating committee. [PHOTO] EDWARD C. JOULLIAN III (64), 1984 Chairman and chief executive officer of Mustang Fuel Corp. (energy development and services) since 1976. Mr. Joullian is a director of The LTV Corp. and American Fidelity Co. He is also chairman of the World Scout Foundation, vice president of Joullian Vineyards, Ltd. and trustee of the Colonial Williamsburg Foundation. Member of the compensation and organization committee and the nominating committee. [PHOTO] HOWARD H. LEACH (63), 1974 President of Leach McMicking & Co. (private investment banking firm) and Leach Capital Corporation; chairman of Hunter Fan Company (manufacturer of ceiling fans) and two California agri-business corporations. He is a director of Frye Copysystems, Inc. and Mammoth Micro Productions, Inc. and is chairman of the Board of Regents for the University of California. Chairman of the nominating committee and member of the compensation and organization committee. [PHOTO] DEAN WERRIES (64), 1979 Chairman of the board of directors. Mr. Werries has been associated with Fleming for 39 years. He was named president and chief operating officer in 1981, chief executive officer in 1988 and chairman of the board in 1989. Mr. Werries retired as president and chief executive officer in 1993 and will retire as chairman effective with the annual meeting. Mr. Werries is past chairman and a director of the Food Marketing Institute. He is a director of the National-American Wholesale Grocers' Association and Sonic Industries, Inc. He is a trustee of the Food Industry Crusade Against Hunger, a member of the board of advisors of the University of Oklahoma College of Business Administration and a member of the board of governors of Oklahoma Christian University of Science and Arts.
6 THE BOARD OF DIRECTORS MEETINGS OF DIRECTORS. During the past year, the board of directors had six regular and four special meetings. Each director attended 75% or more of the meetings of the board and of committees of which he or she was a member except for Mr. Jones and Mr. McMillan. Mr. Jones attended seven of the ten board meetings and was unable to attend the October meeting of the audit and finance committee. Mr. McMillan attended six of the ten board meetings and was unable to attend the February meeting of the audit and finance committee. COMPENSATION OF DIRECTORS. The company pays an annual retainer of $20,000 to nonmanagement directors, plus a fee of $1,000 for each board and committee meeting attended and an additional $250 for each committee meeting chaired, which amounts may be deferred until retirement. Directors are not compensated for participation in telephone meetings of the board of directors or of its committees. In 1992, the company established the Directors' Stock Equivalent Plan under which nonmanagement members of the board may be awarded stock equivalent units within certain limits set forth in the plan. These units represent the right to receive cash equal to the value of shares of common stock when the director ceases to serve, according to the terms of the grant. Upon payment of the stock equivalent units, the company will also pay cash to the participant in an amount equal to dividends or distributions which he or she would have received if the stock equivalent units had been awarded as shares of common stock rather than stock equivalent units. In February 1993, each nonmanagement director was awarded 413 stock equivalent units having a value at that time of $32.50 per unit. Effective at the annual meeting, Dean Werries, chairman of the board, will retire. The compensation and organization committee of the board of directors has approved a consulting agreement with Mr. Werries pursuant to which he will receive $200,000 per year for a three-year period commencing with his retirement, plus reimbursement of reasonable business, travel and other expenses in consideration of his agreeing to provide advisory and consulting services to the company. In addition, Mr. Werries will receive retirement benefits pursuant to the company's defined benefit plan (the "Pension Plan") and Supplemental Retirement Plan (the "SRP"). See "Pension Plan." COMMITTEES OF THE BOARD The board of directors has three standing committees. The principal responsibilities of each are as follows. AUDIT AND FINANCE COMMITTEE. The committee focuses primarily on ethical and regulatory matters and on the effectiveness of the company's accounting policies and practices, financial reporting and internal controls, and the internal audit function. The committee oversees company policies and programs with respect to ethical standards and regulatory compliance. It annually reviews the selection of independent auditors and, after consultation with management, recommends the appointment of independent auditors for board approval and shareholder ratification. It reviews and discusses the scope of the annual audit with management and the independent auditors and may request additional review and audit procedures. The committee reviews and discusses the annual report of the auditors and the auditors' observations and suggestions regarding accounting and control policies, procedures 7 and organization, and their adequacy. The committee makes recommendations, as appropriate, to management based on the auditors' suggestions. The committee reports its findings to the board at least annually. The committee met three times during 1993. COMPENSATION AND ORGANIZATION COMMITTEE. The committee oversees the company's compensation and benefit policies and programs. The committee reviews the objectives, structure, cost and administration of major compensation and benefit policies and programs. It annually reviews officers' salaries, stock options, and other management incentives, and administers the company's stock option and management incentive plans. The stated policy of the committee is to motivate the company's executive officers and other associates to enhance the company's financial performance by focusing on specific business objectives. It also makes recommendations regarding the selection of the chief executive officer. The committee met four times during 1993. NOMINATING COMMITTEE. The committee develops and recommends to the board guidelines and criteria for selecting persons to serve as directors. It recommends nominees for election at the annual meeting and candidates to fill board vacancies. The committee considers and makes recommendations regarding the composition of the board. The committee met once during 1993. The committee will consider nominees recommended by shareholders if such nomination is made pursuant to timely notice in writing in strict accordance with the company's bylaws. A shareholder desiring to make a nomination should contact the senior vice president -- general counsel and secretary to obtain a copy of the bylaws. 8 SECURITY OWNERSHIP OF MANAGEMENT The total number of shares of common stock beneficially owned as of March 1, 1994 by each of the present directors, nominees, both persons who served as chief executive officer in 1993 and each of the other four most highly compensated executive officers, and all of the directors and executive officers as a group, are as follows:
AMOUNT AND NATURE BENEFICIALLY NAME OF BENEFICIAL OWNER OWNED(1) - -------------------------------------------------- ------------------- Dean Werries...................................... 137,292(2) Robert E. Stauth.................................. 47,667(3) R. Randolph Devening.............................. 44,278(4) Archie R. Dykes................................... 1,906(5) Carol B. Hallett.................................. 395 James G. Harlow, Jr............................... 1,794(6) R. D. Harrison.................................... 32,630(7) Lawrence M. Jones................................. 4,470 Edward C. Joullian III............................ 3,000(8) Howard H. Leach................................... 2,200 John A. McMillan.................................. 3,000 Guy A. Osborn..................................... 1,000 James E. Stuard................................... 47,336(9) Glenn E. Mealman.................................. 38,928(10) Robert F. Harris.................................. 18,396(11) All directors and executive officers as a group (24)............................................. 564,805(12) - ------------------------ (1) Unless otherwise indicated, all shares are owned directly by the named person and he or she has sole voting and investment power with respect to such shares. The shares represent less than 1% for each person listed, and approximately 1.52% for all directors and executive officers as a group, of the total shares outstanding. (2) Consists of 43,258 shares owned directly by Mr. Werries, and 19,372 shares owned by a partnership in which Mr. Werries is the general partner, for all of which he has sole voting and investment power, 61,000 shares under options presently exercisable, and 13,662 shares awarded under the 1990 Stock Incentive Plan, subject to forfeiture, for which he has sole voting power. (3) Consists of 6,607 shares owned directly by Mr. Stauth for which he has sole voting and investment power, 11,200 shares under options presently exercisable and 29,860 shares awarded under the 1990 Stock Incentive Plan, subject to forfeiture, for which he has sole voting power. (4) Consists of 7,762 shares owned directly by Mr. Devening for which he has sole voting and investment power, 20,750 shares under options presently exercisable, and 15,766 shares awarded under the 1990 Stock Incentive Plan, subject to forfeiture, for which he has sole voting power.
9 (5) Consists of 1,349 shares owned directly by Mr. Dykes for which he has sole voting and investment power, and 557 shares owned jointly by Mr. Dykes and his wife with whom he shares voting and investment power. (6) Consists of 1,466 shares owned directly by Mr. Harlow for which he has sole voting and investment power, and 328 shares owned jointly with his wife with whom he shares voting and investment power. (7) Consists of 25,450 shares owned directly by Mr. Harrison and 200 shares owned by a partnership in which Mr. Harrison is the managing partner, for all of which he has sole voting and investment power, 900 shares owned by his wife and 6,080 shares held of record by his adult children, for all of which he shares voting and investment power. (8) Owned by a limited partnership in which Mr. Joullian is a general partner and for which he shares voting and investment power with the remaining general partners. (9) Consists of 6,203 shares owned directly by Mr. Stuard for which he has sole voting and investment power, 23,150 shares under options presently exercisable, 7,000 shares owned jointly by Mr. Stuard and his wife with whom he shares voting and investment power, and 10,983 shares awarded under the 1990 Stock Incentive Plan, subject to forfeiture, for which he has sole voting power. (10) Consists of 5,068 shares owned directly by Mr. Mealman for which he has sole voting and investment power, 19,250 shares under options presently exercisable, 4,202 shares owned jointly by Mr. Mealman and his wife with whom he shares voting and investment power, and 10,408 shares awarded under the 1990 Stock Incentive Plan, subject to forfeiture, for which he has sole voting power. (11) Consists of 2,107 shares owned directly by Mr. Harris for which he has sole voting and investment power, 10,125 shares under options presently exercisable, 208 shares owned jointly by Mr. Harris and his wife with whom he shares voting and investment power, and 5,956 shares awarded under the 1990 Stock Incentive Plan, subject to forfeiture, for which he has sole voting power. (12) Includes 128,245 shares for which directors and executive officers have sole voting and investment power, 68,143 shares for which they share voting and investment power with others, 222,350 shares under options presently exercisable, and 146,067 shares awarded under the 1990 Stock Incentive Plan, subject to forfeiture, for which they have sole voting power.
10 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS The following table sets forth the name and address of each known shareholder of the company who beneficially owns more than 5% of the company's common stock, the number of shares beneficially owned by each, and the percentage of outstanding stock so owned according to information made available to the company as of March 1, 1994.
AMOUNT AND NATURE OF BENEFICIAL PERCENT OF NAME AND ADDRESS OWNERSHIP CLASS - ------------------------------------------------- ------------------ ----------- INVESCO MIM PLC 11 Devonshire Square London EC2M 4YR England.......................................... 3,485,790(1) 9.44% Sanford C. Bernstein & Co., Inc. 767 Fifth Avenue New York, New York 10153......................... 3,034,331(2) 8.21% - ------------------------ (1) INVESCO MIM PLC shares the power to vote and dispose of all shares. (2) Sanford C. Bernstein & Co., Inc. has sole power to vote 1,799,566 shares and to dispose of all shares.
11 SUMMARY COMPENSATION TABLE The following summary compensation table sets forth the compensation information for both persons who served as chief executive officer in 1993 and the four other most highly compensated executive officers for services rendered in all capacities during the fiscal years ended December 25, 1993, December 26, 1992 and December 28, 1991.
LONG TERM COMPENSATION AWARDS ANNUAL COMPENSATION ---------------------- ------------------------------------------------ RESTRICTED OTHER ANNUAL STOCK ALL OTHER NAME AND PRINCIPAL COMPENSATION AWARD(S) OPTIONS COMPENSATION POSITION YEAR SALARY($) BONUS($) ($)(1) ($)(2) (3) (#)(3) ($)(4) - --------------------------- --------- ---------- ---------- ------------- ---------- ---------- ------------- Dean Werries(5) 1993 583,682 -- 1,002 -- -- -- Chairman 1992 550,336 78,837 1,002 -- -- -- 1991 538,462 220,411 -- -- -- -- Robert E. Stauth 1993 325,186 -- 73,343 174 -- -- -- President and Chief 1992 211,320 76,300 174 -- -- -- Executive Officer 1991 164,826 -- 277,494 -- -- R. Randolph Devening 1993 305,290 -- 174 -- -- -- Vice Chairman and Chief 1992 302,577 81,668 174 -- -- -- Financial Officer 1991 291,154 150,636 -- -- -- -- James E. Stuard 1993 242,368 38,421 570 -- -- 50,000(6) Executive Vice President- 1992 237,799 68,023 570 -- -- -- Southern Region 1991 229,808 81,816 -- -- -- -- Glenn E. Mealman 1993 226,745 54,489 570 -- -- -- Executive Vice President- 1992 222,535 37,101 570 -- -- -- Mid-America Region 1991 212,181 73,120 -- -- -- -- Robert F. Harris(7) 1993 208,188 74,679 -- -- -- -- Senior Vice President-Mid- 1992 201,726 46,494 -- -- -- -- South Region 1991 194,509 75,517 -- 282,015 -- -- - ------------------------------ (1) The company provides term life insurance to all associates generally, and there is no imputed income to the associate with respect to the first $50,000 of coverage except for highly compensated associates. Accordingly, the company is required to impute income to the named individuals with respect to the first $50,000 of coverage and reimburses them for its tax effect. The amounts shown in this column reflect such tax reimbursement amounts. In accordance with the position of the staff of the Securities and Exchange Commission which permits a phase-in of the information required by this column, the data shown in this column is only for the 1992 and 1993 fiscal years. (2) The restricted stock awards reported in this column were made pursuant to the company's 1990 Stock Incentive Plan. Awards were made to Mr. Werries, Mr. Devening, Mr. Stuard and Mr. Mealman in 1990 (the "Phase I Awards"). On February 19, 1991, Mr. Stauth was awarded 8,102 shares, and Mr. Harris was awarded 8,234 shares; the market price on the date of grant was $34.25 (the "Phase II Awards"). The Phase I Awards vest over a five-year period (the "Phase I Performance Cycle" which covers fiscal years 1990 through 1994) in the event the net earnings of the company shall have increased on a cumulative basis by a specified amount from the fiscal year ended December 30, 1989, and the company shall have achieved specified increases in the net profit margin (net earnings as a percent of sales). The Phase II Awards vest over a four-year period (the "Phase II Performance Cycle" which covers fiscal years 1991 through 1994) on the same basis as the
12 Phase I Awards. In the event both goals are attained during each year of the Phase I Performance Cycle and the Phase II Performance Cycle, the holder of the restricted shares may earn between 25% and 50% of the restricted stock awarded to him until he has attained 100% of the award. Unearned restricted stock will be forfeited at the end of the applicable Performance Cycle. Dividends are payable on the shares of restricted stock if and to the extent paid on the company's common stock generally. As of the last day of fiscal 1993, there were held in escrow for Mr. Werries 13,662 restricted shares with a value of $329,596, Mr. Stauth 5,860 restricted shares with a value of $141,373, Mr. Devening 7,766 restricted shares with a value of $187,355, Mr. Stuard 6,183 restricted shares with a value of $149,165, Mr. Mealman 5,608 restricted shares with a value of $135,293, and Mr. Harris 5,956 restricted shares with a value of $143,689. (3) Awards of restricted stock under the company's 1990 Stock Incentive Plan and grants of stock options under the company's stock option plans were made after fiscal 1993 and will be disclosed as compensation for fiscal 1994 in the company's proxy statement for the annual meeting to be held in 1995. (4) In accordance with the position of the staff of the Securities and Exchange Commission which permits a phase-in of the information required by this column, the data shown in this column is only for the 1992 and 1993 fiscal years. (5) Retired as chief executive officer in October 1993 and will retire as chairman effective with the annual meeting. (6) Represents payment under a consulting agreement. See "Termination of Employment and Change in Control Arrangements -- Other Arrangements." (7) Retired as senior vice president-Mid-South Region in January 1994.
REPORT OF THE COMPENSATION COMMITTEE EXECUTIVE OFFICERS The policy of the compensation and organization committee (the "Committee"), implemented through the compensation programs described below, is to motivate executive officers and other associates to enhance the company's financial performance by focusing attention on specific business objectives emphasizing teamwork among associates and to reward such executive officers and other associates based on corporate and individual performance. No executive officer's compensation for 1993 exceeded the $1 million deduction limit under Section 162(m) of the Internal Revenue Code, as amended, and the same result is anticipated for 1994. The Committee has not yet established a policy with respect to qualifying compensation paid to its executive officers for deductibility under Section 162(m), and intends to study the implications of Section 162(m) on the company's compensation plans. Compensation for the company's executive officers is generally comprised of base salary, bonus and awards of stock options or restricted stock. Decisions with respect to compensation, except for that of the chief executive officer (the "CEO"), are made by the Committee, composed of five nonmanagement directors, upon the recommendation of the CEO. The Committee separately determines the CEO's compensation. The Committee's decisions are submitted to the full board of directors for its information and review only. Earnings of the company and the market value of its stock are considered subjectively by the members of the Committee in setting the CEO's and other executive officers' base salaries. Also, some bonus awards are based in part on earnings performance. Directors who are also executive officers of the company participate in the board's review of the Committee's decisions regarding their respective compensation. Decisions about awards under certain of the company's stock-based compensation plans are made solely by the Committee in order for awards to comply with Securities and Exchange Commission Rule 16b-3. 13 SALARY. In determining salary for fiscal 1993, the Committee relied on the company's salary administration program, the objectives of which are to attract, retain and motivate productive executive officers and other management associates. For each job classification, the program requires a written job description, an evaluation of the job with assigned points based on the nature of the job, its functions and the level of the position, and an assigned salary range based on the total point value. Annual salaries are adjusted based on individual performance. In addition, each member of the Committee reviews the earnings of the company and the market value of the company's common stock for the previous fiscal year-end, and, based on these factors, the Committee makes a subjective determination of the nature and extent of salary adjustments. The Committee generally sets salaries in the high end of the assigned salary range. In order to measure competitiveness, the Committee also considers salary surveys comparing company jobs with similar jobs held by employees of companies included in the company's peer group. See "Company Performance." BONUSES. Bonus awards are determined, within the Committee's discretion, with reference to company and individual performance measured against criteria established under the Fleming Companies, Inc. Incentive Compensation Program ("FICP"). The Committee establishes the company criteria annually in February, which criteria may be adjusted based on internal and external business factors. Pursuant to the FICP, the Committee assigns a weight to each criterion, which, in conjunction with targets for each criterion, guides the Committee's determination of performance units earned by each executive officer. When the executive officer's performance units equal a predetermined number, he becomes eligible to receive a bonus. Bonuses under the FICP for 1993 for the six senior corporate staff executive officers (collectively, the "Top Management Group") are based entirely on the following corporate targeted goals: earnings per share, sales, net earnings as a percent of net sales and return on capital (collectively, the "Corporate Objectives"). Bonuses under the FICP for 1993 for the eight executive officers responsible for regional and division operations and for corporate staff operations such as legal and accounting (collectively, the "Other Executive Officers") are based fifty percent on the attainment by the company of targeted goals based on sales and earnings of the company's core business operations (the "Other Objectives"). The remaining fifty percent is tied to the attainment of specified key business objectives (the "Key Business Objectives") which are unique to each of the Other Executive Officers and are designed to reflect specifically expected achievements within the region or division or by the corporate sub unit for which each Other Executive Officer has primary responsibility. Since the company failed to meet the Corporate Objectives in 1993, none of the members of the Top Management Group received the threshold number of units required to be eligible for a bonus payment for 1993. However, all of the Other Executive Officers received enough units in connection with their Key Business Objectives which, when added to the units received for the Other Objectives, made them eligible to receive bonuses for 1993. RESTRICTED STOCK AND STOCK OPTIONS. As described in footnote two to the Summary Compensation Table above, pursuant to the 1990 Stock Incentive Plan, the Committee can award restricted stock to executive officers and other key management associates which vests upon the attainment of targeted profit and/or performance criteria. The Committee believes that restricted stock awards build stock 14 ownership and provide a long-term focus since the stock is restricted from being sold, transferred, or assigned until vested, and is forfeitable. No awards were granted in fiscal 1993. No previously granted awards vested in fiscal 1993 because the targeted profit and performance criteria were not attained during the year. Pursuant to the company's 1985 and 1990 Stock Option Plans, at year-end there were 1,479,489 options available for grant to executive officers and other key management associates. No options were granted in fiscal 1993. CHIEF EXECUTIVE OFFICER Mr. Stauth became CEO in October 1993, and his salary as CEO was determined by the Committee in accordance with the policies set forth above for all executive officers. Based on his individual performance as executive vice president -- division operations, the position he held prior to his promotions, he received an annual salary increase of $15,000 in February 1993. In March 1993, he received an additional annual salary increase of $65,000 to reflect his promotion to president of the company. Commensurate with his increased duties and responsibilities as CEO, Mr. Stauth received an additional annual salary increase of $100,000 when he became CEO in October 1993. Since the company failed to meet the Corporate Objectives, Mr. Stauth did not receive a bonus for 1993. In February 1994, he was elected chairman effective with the annual meeting. Mr. Werries served as CEO until his retirement from the position in October 1993. His salary as CEO was determined by the Committee in accordance with the policies set forth above for all executive officers. Although he did not receive a bonus for 1993, Mr. Werries did receive a nine percent increase in his salary for 1993. Mr. Werries had not received a salary increase since 1991, and the Committee determined that such an increase was appropriate. Mr. Werries will retire as chairman at the annual meeting. In connection with his retirement, he entered into a consulting agreement with the company. See "The Board of Directors -- Compensation of Directors." The Committee approved the payments under the consulting agreement in recognition of Mr. Werries' 39 years of service to the company, his continued representation of the company at industry functions, and his availability to Mr. Stauth, the current CEO, for advice and counsel. James G. Harlow, Jr., Chairman Howard H. Leach R. D. Harrison John A. McMillan Edward C. Joullian III
15 COMPANY PERFORMANCE The following graph shows a five-year comparison of cumulative total returns for the company, the S&P 500 composite index and an index of peer companies selected by the company with the investment weighted based on market capitalization at the beginning of each year.
1988 1989 1990 1991 1992 1993 ---- ---- ---- ---- ---- ---- Fleming Companies, Inc. 100 89 107 108 102 84 S&P 500 100 132 128 166 179 197 Peer Index 100 109 101 112 122 135
The total cumulative return on investment (change in the year-end stock price plus reinvested dividends) for each year for the company, the peer group and the S&P 500 composite is based on the stock price or composite index at the end of calendar 1988. Companies in the peer group are as follows: Fleming Companies, Inc., SUPERVALU, Inc., Nash Finch Co., Super Food Services, Inc., Richfood Holdings, Inc., and Super Rite Corp. Due to unavailable data, performance for Super Rite Corp. in the peer index has been excluded for the years 1989 through 1991. 16 COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION The company's compensation and organization committee consists of James G. Harlow, Jr., chairman, and R. D. Harrison, Edward C. Joullian III, Howard H. Leach and John A. McMillan, members. Mr. Harrison served the company as president and chief executive officer from 1966 to 1981, chairman and chief executive officer from 1981 to 1988, and as chairman at his time of retirement in 1989. STOCK OPTION INFORMATION The following table sets forth information concerning each exercise of stock options by the named executive officer during the fiscal year ended December 25, 1993 with information regarding the value as of the fiscal year-end of any unexercised options. AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION VALUES
NUMBER OF SECURITIES VALUE OF UNDERLYING UNEXERCISED UNEXERCISED IN-THE-MONEY OPTIONS AT OPTIONS AT SHARES FY-END (#) FY-END ($)(1) ACQUIRED -------------- ------------- ON EXERCISE VALUE REALIZED EXERCISABLE/ EXERCISABLE/ NAME (#) ($) UNEXERCISABLE UNEXERCISABLE - ----------------------------------------- -------------- ---------------- -------------- ------------- Dean Werries............................. -- -- 61,000/5,000 -- Robert E. Stauth......................... -- -- 11,200/2,000 -- R. Randolph Devening..................... -- -- 20,750/2,750 -- James E. Stuard.......................... -- -- 25,650/2,250 -- Glenn E. Mealman......................... -- -- 20,750/2,250 -- Robert F. Harris......................... -- -- 10,125/1,875 -- - ------------------------ (1) The values shown in this column are based on a market price of the company's common stock at 1993 fiscal year-end of $24.125 per share. None of the options held at the end of the fiscal year was in-the-money.
PENSION PLAN The following table illustrates estimated annual benefits payable under the company's Pension Plan to the named executive officers upon retirement, assuming retirement at age 65, including 17 amounts attributable to the company's SRP which provides benefits that would otherwise be denied participants due to certain limitations on qualified benefit plans in the Internal Revenue Code of 1986, as amended (the "Code"):
PENSION PLAN TABLE - ----------------------------------------------------------------------------------------------- YEARS OF SERVICE --------------------------------------------------------------------------- REMUNERATION 10 15 20 25 30 35 40 - ----------------------------------------------------------------------------------------------- $250,000........ $ 125,000 $ 137,500 $ 150,000 $ 162,500 $ 175,000 $ 187,500 $ 200,000 300,000........ 150,000 165,000 180,000 195,000 210,000 225,000 240,000 350,000........ 175,000 192,500 210,000 227,500 245,000 262,500 280,000 400,000........ 200,000 220,000 240,000 260,000 280,000 300,000 320,000 450,000........ 225,000 247,500 270,000 292,500 315,000 337,500 360,000 500,000........ 250,000 275,000 300,000 325,000 350,000 375,000 400,000 550,000........ 275,000 302,500 330,000 357,500 385,000 412,500 440,000 600,000........ 300,000 330,000 360,000 390,000 420,000 450,000 480,000 650,000........ 325,000 357,500 390,000 422,500 455,000 487,500 520,000 700,000........ 350,000 385,000 420,000 455,000 490,000 525,000 560,000 750,000........ 375,000 412,500 450,000 487,500 525,000 562,500 600,000 800,000........ 400,000 440,000 480,000 520,000 560,000 600,000 640,000 850,000........ 425,000 467,500 510,000 552,500 595,000 637,500 680,000
The estimated number of years of credited service for each of the named executive officers is as follows: Mr. Werries, 39; Mr. Stauth, 17; Mr. Devening, 12; Mr. Stuard, 29; Mr. Mealman, 36; and Mr. Harris, 11. Benefit amounts payable under the Pension Plan are (i) payable on a straight life basis computed as a percentage of final average compensation (consisting of salaries, wages, commissions and bonuses) for the five calendar plan years during the last ten years of the associate's career for which such average is the highest, (ii) subject to offset for Social Security and (iii) limited by the Employee Retirement Income Security Act of 1974, as amended, and by the Code. There is also an additional dollar limitation on benefits which an associate may earn under all of the company's qualified pension plans. The SRP is a defined benefit supplementary plan which provides retirement benefits for each of the named executive officers, with the exception of Mr. Harris. Benefit amounts payable under the SRP are intended to provide a minimum base retirement benefit and are therefore offset by amounts payable from other retirement plans, including the Pension Plan and Social Security payments. The SRP benefit is based upon a percentage of the participant's total highest annual compensation paid during the last three years of employment. The percentage ranges from 50% to 80%. Retirement payments commence upon retirement after age 65 (or with the consent of the company, after age 55) or upon termination of an eligible associate within two years after a change of control of the company. See "Termination of Employment and Change in Control Arrangements -- SRP and Trust Agreement." 18 TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL ARRANGEMENTS SEVERANCE AGREEMENTS. The company has entered into severance agreements with Messrs. Werries, Stauth, Devening, Stuard, Mealman and Harris. The severance agreements provide for severance pay should a change in control of the company occur (as defined in the agreements). Under the severance agreements, an associate's employment must be terminated involuntarily, without cause, whether actual or "constructive" (demotion, relocation, loss of benefits or other changes in an associate's terms of employment short of actual termination), following a change in control for severance pay to be available. Under the severance agreements, severance pay equals two years' salary based on the associate's rate of compensation at the time of change in control. Assuming a change of control on December 25, 1993, and termination of employment of Messrs. Werries, Stauth, Devening, Stuard, Mealman and Harris, the company would be required under the severance agreements to pay $1,200,000, $840,000, $630,000, $488,600, $456,200 and $411,200, respectively. SRP AND TRUST AGREEMENT. The SRP provides for retirement benefits to be paid to each of the named executive officers except Mr. Harris, who is not covered by the plan, in the event his employment is terminated within two years after a change in control of the company. Assuming a change of control on December 25, 1993 and the termination of employment of the following persons within two years after that, the company would be required under the SRP to pay the following amounts annually for life to the following named executives: Mr. Werries, $459,907, Mr. Stauth, $162,083, Mr. Devening, $184,531, Mr. Stuard, $115,082, and Mr. Mealman, $91,174. The company has entered into a Supplemental Income Trust (the "Trust"). The company will use the Trust to set aside funds necessary to satisfy the company's obligations to associates with respect to the SRP and the severance agreements, including obligations arising following a change in control of the company. The Trust assets relating to company contributions are always subject to the claims of general creditors of the company. No associate with any right to or interest in any benefit or future payments under the Trust will have any right to or security interest in any specific asset of the Trust or any right to assign any benefits or rights which he or she may expect to receive from the Trust. OTHER ARRANGEMENTS. Pursuant to the provisions of the company's 1990 Stock Incentive Plan, in the event of a "change of control" of the company, the compensation and organization committee, in its sole discretion, may accelerate the vesting and payment of any award or may determine that a payment instead of an award may be made. Under Phase III of this plan, adopted in February 1994, a participant is entitled to receive a cash payment equal to his annual base salary if the event occurs in the first year of the performance cycle, two-thirds of his annual base salary if the event occurs in the second year of the performance cycle and one-third of his annual base salary if the event occurs in the third year of the performance cycle. Pursuant to the provisions of the company's 1990 Stock Option Plan, in the event of a "change of control" of the company, all options outstanding under the plan, with and without SARs, will become automatically fully vested and immediately exercisable with such acceleration to occur without requirement of any further act by the company or any plan participant. All of the named executive officers participate in the above-described plans. Mr. Stuard has entered into an agreement with the company pursuant to which he will act as a consultant to the company after his retirement. Under the agreement, in recognition of his valuable 19 service to the company, he received a $50,000 payment in December 1993 and will receive a $50,000 payment in December 1994. Upon his retirement, he will receive retirement benefits under the Pension Plan and the SRP. At retirement, the company will provide Mr. Stuard with health insurance for which the company will pay premiums until he reaches age 65. Mr. Harris has entered into an employment agreement with the company pursuant to which he will remain an employee of the company for one year beginning January 13, 1994, during which he will continue to receive his base salary and existing benefits. RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS Upon the recommendation of the audit and finance committee, the board of directors has reappointed Deloitte & Touche as independent auditors for 1994 and is requesting ratification by the shareholders. Deloitte & Touche has audited the consolidated financial statements since 1967. Services performed by Deloitte & Touche for the 1993 fiscal year included, among others, the audit of annual financial statements and consultations concerning various tax and accounting matters. Representatives of Deloitte & Touche will attend the meeting, have the opportunity to make a statement if they so desire, and be available to answer questions. Ratification of the appointment of independent auditors requires the affirmative vote by the holders of a majority of the stock having voting power present at the meeting. The board of directors unanimously recommends a vote FOR the ratification of the appointment of Deloitte & Touche. SHAREHOLDER PROPOSALS Any proposals of shareholders intended to be presented at the 1995 annual meeting must be received not later than November 18, 1994, to be considered for inclusion in the proxy statement and form of proxy relating to the meeting. No shareholder proposals were received for inclusion in this proxy statement. OTHER BUSINESS The board of directors knows of no business which will be presented for action at the meeting other than that described in the notice of annual meeting. If other matters come before the meeting, the proxies will be voted according to the judgment of the persons named on the proxy card. It is important that the proxies be returned promptly. Therefore, shareholders who do not expect to attend the annual meeting in person are requested to complete and return the proxy card as soon as possible. By Order of the Board of Directors DAVID R. ALMOND SENIOR VICE PRESIDENT GENERAL COUNSEL AND SECRETARY 20 P R O X Y FLEMING COMPANIES, INC.-- ANNUAL MEETING OF SHAREHOLDERS Dean Werries, Robert E. Stauth or David R. Almond is hereby constituted the proxy of the undersigned with full power of substitution to represent and vote all shares of stock of the undersigned at the annual meeting of shareholders of Fleming Companies, Inc., or any adjournment thereof, to be held April 27, 1994, at 10:00 a.m. I. Election of Directors Withhold authority to For all nominees vote for all nominees /__/ listed below /__/ listed below R. Randolph Devening, Carol B. Hallett, Lawrence M. Jones (for three- year terms), Robert E. Stauth (for one-year term) (INSTRUCTION: To withhold authority to vote for any individual nominee, write the nominee's name in the space provided below.) - ------------------------------------------ II. Ratification of Deloitte & Touche as independent auditors for 1994. /__/ FOR /__/ AGAINST /__/ ABSTAIN III. In their discretion, on such other business as may properly come before the meeting or any adjournment thereof. The shares represented by this proxy will be voted as specified, or if no direction is indicated, they will be voted FOR the election of the directors nominated by the board and FOR Items II and III. The board of directors recommends a vote FOR each of these items. PLEASE SIGN, DATE AND RETURN THE PROXY CARD USING THE ENCLOSED ENVELOPE. [LOGO] SEE REVERSE SIDE FOR MATTERS TO BE VOTED ON I RESERVE THE RIGHT TO REVOKE THIS PROXY AT ANY TIME BEFORE THE EXERCISE THEREOF. __________________________ Signature _____________________, 1994 __________________________ Please sign exactly as name appears below, indicating official position or representative capacity. FOR JOINT ACCOUNTS EACH OWNER SHOULD SIGN THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS -----END PRIVACY-ENHANCED MESSAGE-----