(614) 464-5607
July 1, 1994
VIA ELECTRONIC TRANSMISSION
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Bob Evans Farms, Inc.
Commission File No. 0-1667
CIK No.: 0000033769
Gentlemen:
On behalf of Bob Evans Farms, Inc. (the "Company"), and
in accordance with Rule 14a-6(b) promulgated under the Securities
Exchange Act of 1934, as amended, and Regulation S-T, we are
enclosing herewith for filing definitive copies of the Letter to
Stockholders, Notice of Annual Meeting of Stockholders, Proxy
Statement and form of Proxy (collectively, the "Proxy Materials"),
to be furnished to the stockholders of the Company in connection
with the solicitation of proxies by the Board of Directors of the
Company for use at the 1994 Annual Meeting of Stockholders (the
"Annual Meeting"), scheduled to be held on Monday, August 8, 1994.
Pursuant to Rule 14a-6(m), we are also enclosing herewith a
completed copy of the Schedule 14A information page. In accord-
ance with Rule 901(d) of Regulation S-T, the Company will be
submitting to the Commission a paper copy of the Proxy Materials
and the Schedule 14A information page. Each document will contain
the legend required by Rule 901(d)(2).
In accordance with Rules 304(d) and 311 of Regula-
tion S-T, the Company has previously delivered to the Commission
one fully-executed copy and two conformed copies of Form SE
pursuant to which the Company filed the performance graph that is
to appear in the Proxy Statement.
In accordance with Rule 14a-6(i)(1), the amount of
$125.00 has been wire transferred to the account of the Commission
at Mellon Bank on behalf of the Company.
The Company was not required to file preliminary copies
of the Proxy Materials since the only proposals to be presented to
the stockholders for their consideration at the Annual Meeting
will be (1) the election of three Class II Directors to serve for
terms of three years each; and (2) the approval of the Bob Evans
Farms, Inc. 1994 Long Term Incentive Plan (the "1994 Plan"). The
1994 Plan is included as Exhibit A to the Proxy Statement. The
shares of Common Stock subject to the Plan will be registered
under the Securities Act of 1933 pursuant to a Registration
Statement on Form S-8 as soon as practicable after the Annual
Meeting, assuming the 1994 Plan is approved by the Company's
stockholders.
The Proxy Materials and the Annual Report to Stock-
holders for the fiscal year ended April 29, 1994 (the "Annual
Report") will be mailed to the stockholders of the Company
beginning on July 1, 1994. In addition, in accordance with
Rule 14a-3(c), seven (7) copies of the Annual Report will be
submitted to the Commission.
If you have any questions with respect to the enclosed
materials, please do not hesitate to call me at (614) 464-5607.
Very truly yours,
Elizabeth Turrell Farrar
ETF:i
Enclosures
cc: Bob Evans Farms, Inc.
G. Robert Lucas II, Esq.
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant[X]
Filed by a Party other than the Registrant[ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Bob Evans Farms, Inc.
(Name of Registrant as Specified In Its Charter)
Bob Evans Farms, Inc.
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $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:
________________________________________________________
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:
________________________________________________________
4) Proposed maximum aggregate value of transaction:
________________________________________________________
[ ] 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:
________________________________________________
[BOB EVANS FARMS, INC. LETTERHEAD]
ANNUAL MEETING OF STOCKHOLDERS
To be held August 8, 1994
July 1, 1994
To Our Stockholders:
I take pleasure in inviting you to our Annual Meeting of
Stockholders, which will be held on Monday, August 8, 1994, at
4:00 p.m., Eastern Daylight Time, at The Shelter House on the
Company Farm, at Rio Grande, Ohio. The farm is located on State
Route 588, approximately 12 miles north of Gallipolis, Ohio.
The matters to be considered and acted upon at this
year's Annual Meeting include the following:
1. The election of three Class II directors to serve
for terms of three years each.
2. The consideration of and vote upon a proposal to
approve the Bob Evans Farms, Inc. 1994 Long Term
Incentive Plan.
3. The consideration of the reports to be laid before
the Annual Meeting or any adjournment or adjourn-
ments thereof.
4. The transaction of such other business as may
properly come before the Annual Meeting or any
adjournment or adjournments thereof.
At the Annual Meeting, we will also report to you on our
operations during the past year and our plans for the future.
The close of business on June 17, 1994, has been fixed
as the record date for determination of stockholders entitled to
notice of the Annual Meeting and to vote at the Annual Meeting or
any adjournment or adjournments thereof. The transfer books will
not be closed.
The formal Notice of the Annual Meeting and the Proxy
Statement follow. After reading the Proxy Statement, please
promptly fill in, sign and return to us the enclosed proxy to
ensure that your shares will be represented at the Annual Meeting.
Your vote is important to the Company and your Board recommends
that you vote "FOR" Proposal 1, the election as directors of the
Company of all persons named in the Proxy Statement as nominees,
and "FOR" Proposal 2, the approval of the Bob Evans Farms, Inc.
1994 Long Term Incentive Plan.
Last year more than 82% of the Company's shares were
represented in person or by proxy at the Annual Meeting. The
Company appreciates this interest on your part.
We hope to see many of you in person at the Annual
Meeting. There will be a social hour beginning at 3:00 p.m. Soft
drinks and sandwiches will be served and we hope you will take
this opportunity to become acquainted with the officers and
directors of your Company. If you cannot attend in person, please
fill in, sign and return your proxy.
Sincerely,
Daniel E. Evans
Chairman of the Board
(Chief Executive Officer)
BOB EVANS FARMS, INC.
P.O. Box 07863
Columbus, Ohio 43207
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Columbus, Ohio
July 1, 1994
To the Stockholders of
Bob Evans Farms, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of
the Stockholders (the "Annual Meeting") of Bob Evans Farms, Inc.
(the "Company") will be held at The Shelter House, Bob Evans
Farms, Rio Grande, Ohio (approximately 12 miles north of
Gallipolis, Ohio, on State Route No. 588) on Monday, August 8,
1994, at 4:00 p.m., Eastern Daylight Time, for the following
purposes:
(1) To elect three Class II directors to
serve for terms of three years each.
(2) To consider and vote upon a proposal
to approve the Bob Evans Farms, Inc.
1994 Long Term Incentive Plan.
(3) To consider the reports to be laid
before the Annual Meeting or any
adjournment or adjournments thereof.
(4) To transact such other business as
may properly come before the Annual
Meeting or any adjournment or
adjournments thereof.
Stockholders of record at the close of business on
June 17, 1994, will be entitled to receive notice of and to vote
at the Annual Meeting and any adjournment or adjournments thereof.
A list of the stockholders entitled to vote at the
Annual Meeting will be available for inspection by any
stockholder, for any purpose germane to the Annual Meeting, during
ordinary business hours, at the offices of the Company, 3776 South
High Street, Columbus, Ohio 43207, from July 29, 1994 until the
Annual Meeting.
By Order of the Board of Directors,
Daniel E. Evans
Chairman of the Board
(Chief Executive Officer)
BOB EVANS FARMS, INC.
P.O. Box 07863
Columbus, Ohio 43207
(614) 491-2225
July 1, 1994
PROXY STATEMENT
This Proxy Statement and the accompanying proxy are
being mailed on or about July 1, 1994, to all stockholders of Bob
Evans Farms, Inc. (the "Company") of record at the close of
business on June 17, 1994, in connection with the solicitation of
proxies by the Board of Directors of the Company for use at the
Annual Meeting of Stockholders (the "Annual Meeting") scheduled to
be held on Monday, August 8, 1994, or at any adjournment or
adjournments thereof. The Annual Meeting will be held at
4:00 p.m., Eastern Daylight Time, at The Shelter House, Bob Evans
Farms, Rio Grande, Ohio (approximately 12 miles north of
Gallipolis, Ohio on State Route No. 588).
A proxy for use at the Annual Meeting accompanies
this Proxy Statement and is solicited by the Board of Directors of
the Company. Stockholders of the Company may use their proxies if
they are unable to attend the Annual Meeting in person or wish to
have their shares of Common Stock, par value $.01 per share (the
"Common Shares"), voted by proxy even if they do attend the Annual
Meeting. Without affecting any vote previously taken, any
stockholder executing a proxy may revoke it at any time before it
is voted by filing with the Secretary of the Company, at the
address of the Company set forth on the cover page of this Proxy
Statement, written notice of such revocation; by executing a
later-dated proxy which is received by the Company prior to the
Annual Meeting; or by attending the Annual Meeting and giving
notice of such revocation in person. Attendance at the Annual
Meeting will not, in and of itself, constitute revocation of a
proxy.
The Company will bear the costs of preparing and
mailing this Proxy Statement, the accompanying proxy and any other
related materials and all other costs incurred in connection with
the solicitation of proxies on behalf of the Board of Directors.
Officers and employees of the Company may solicit proxies by
further mailing, by telephone or by personal contact without
receiving any additional compensation therefor. The Company will
also pay the standard charges and expenses of brokerage houses,
voting trustees, banks, associations and other custodians,
nominees and fiduciaries, who are record holders of Common Shares
of the Company not beneficially owned by them, for forwarding such
materials to and obtaining proxies from the beneficial owners of
such Common Shares.
The Annual Report of the Company for the fiscal
year ended April 29, 1994 (the "1994 fiscal year"), including
financial statements, is enclosed with this Proxy Statement.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
Only stockholders of record at the close of
business on June 17, 1994, are entitled to receive notice of and
to vote at the Annual Meeting or any adjournment or adjournments
thereof. At June 17, 1994, the Company had outstanding 42,156,005
Common Shares entitled to vote at the Annual Meeting. Each Common
Share entitles the holder thereof to one vote upon each matter to
be voted upon by stockholders at the Annual Meeting.
Under the rules of the Securities and Exchange
Commission (the "SEC"), boxes and a designated blank space are
provided on the form of proxy for stockholders to mark if they
wish either to abstain on a proposal presented for stockholder
approval or to withhold authority to vote for one or more nominees
for election as a director of the Company. In accordance with
Delaware law and the Company's By-Laws, Common Shares as to which
the authority to vote is withheld will be counted for quorum
purposes but will not be counted toward the election of directors
or toward the election of the individual nominees specified on the
form of proxy. Abstentions are counted as present for quorum
purposes; however, the effect of an abstention on the proposal to
approve the Bob Evans Farms, Inc. 1994 Long Term Incentive Plan is
the same as a "no" vote.
The election of directors is considered a
"discretionary" item upon which brokerage firms may vote in their
discretion on behalf of their clients if such clients have not
furnished voting instructions by the tenth day before the Annual
Meeting. However, the proposal to approve the Bob Evans Farms,
Inc. 1994 Long Term Incentive Plan is "non-discretionary," and
brokers who have received no instructions from their clients do
not have discretion to vote on this item. Such "broker non-votes"
will not be considered as votes entitled to be cast in determining
the outcome of the proposal to approve the Bob Evans Farms, Inc.
1994 Long Term Incentive Plan.
At June 17, 1994, no person was known to the
Company to be the beneficial owner of more than five percent of
any class of the Company's voting securities.
The following table sets forth certain information
with respect to the Company's Common Shares beneficially owned by
each of the nominees for election as a director of the Company, by
each of the continuing directors of the Company, by each of the
executive officers of the Company named in the Summary
Compensation Table and by all directors and executive officers of
the Company as a group, as of June 17, 1994:
Amount and Nature of Beneficial Ownership(1)
Common Shares Which
Can be Acquired
Name of Beneficial Upon Exercise of
Owner or Number of Common Shares Options Exercisable Percent of
Persons in Group Presently Held Within 60 Days Total Class(2)
Larry C. Corbin(3)(4) 31,702 5,493 37,195 (5)
Daniel E. Evans(4)(6) 593,172(7) 113,883 707,055 1.7%
J. Tim Evans(6) 595,944(8) 4,107 600,051 1.4%
Daniel A. Fronk(6) 16,205 4,107 20,312 (5)
G. Robert Lucas II(6) 7,327(9) 4,107 11,434 (5)
Cheryl L. Krueger(6) 44(10) 2,054 2,098 (5)
Stewart K. Owens(3)(4) 209,309 6,733 216,042 (5)
Robert E. H. Rabold(3) 513 -0- 513 (5)
Robert S. Wood(6) 1,445,618(11) -0- 1,445,618 3.4%
Roger D. Williams(4) 30,968(12) 4,960 35,928 (5)
Howard J. Berrey(4) 28,635 4,960 33,595 (5)
All directors and
executive officers
as a group
(15 persons) 2,986,261(13) 163,804 3,150,065 7.4%
<FN>
<F1> Unless otherwise indicated, the beneficial owner has sole
voting and investment power with respect to all of the
Common Shares reflected in the table. All fractional Common
Shares have been rounded to the nearest whole Common Share.
<F2> The percent of class is based upon the sum of 42,156,005
Common Shares outstanding on June 17, 1994, and the number
of Common Shares as to which the named person has the right
to acquire beneficial ownership upon the exercise of stock
options exercisable within 60 days of June 17, 1994.
<F3> Nominee for election as a director of the Company.
<F4> Executive officer of the Company named in the Summary
Compensation Table.
<F5> Represents ownership of less than 1% of the outstanding
Common Shares of the Company.
<F6> Continuing director of the Company.
<F7> Includes 9,506 Common Shares held by the wife of Mr. Evans,
1,646 Common Shares held by the wife of Mr. Evans as
custodian for her son and 37,362 Common Shares held by Evans
Enterprises, Inc. In his capacity as Chairman, Chief
Executive Officer and sole shareholder of Evans Enterprises,
Inc., Mr. Evans may be deemed to have sole voting and
investment power with respect to the Common Shares held by
that corporation.
<F8> Includes 133,388 Common Shares held by the wife of Mr.
Evans.
<F9> Includes 370 Common Shares held by Mr. Lucas as custodian
for the benefit of his daughter, 370 Common Shares held by
Mr. Lucas as custodian for the benefit of his son, 3,167
Common Shares held by Mr. Lucas in a KEOGH plan for the
benefit of Mr. Lucas and 400 Common Shares held in the
William B. Lucas Trust with respect to which Mr. Lucas
serves as trustee and exercises sole voting and investment
power.
<F10> Includes 44 Common Shares held by the husband of
Ms. Krueger.
<F11> Includes 133,333 Common Shares held by the wife of Mr. Wood
and 838,419 Common Shares held by the wife of Mr. Wood in
her capacity as trustee of certain trusts with respect to
which Mr. Wood has neither voting nor investment power.
<F12> Includes 340 Common Shares held by Mr. Williams as custodian
for the benefit of his son and 340 Common Shares held by
Mr. Williams as custodian for the benefit of his daughter.
<F13> Includes Common Shares held by the spouses and children of
certain executive officers and directors, Common Shares held
by custodians for the children of certain executive officers
and directors and Common Shares held by spouses of certain
executive officers and directors in their capacities as
trustees of certain trusts. See notes (7) through (12).
ELECTION OF DIRECTORS
Directors of the Company are elected at the Annual
Meeting. There are currently nine members of the Board of
Directors. Pursuant to the By-Laws of the Company, the directors
have been divided into three classes of three directors each.
Class I directors currently serve until the Annual Meeting in
1996, Class II directors currently serve until the Annual Meeting
in 1994, and Class III directors currently serve until the Annual
Meeting in 1995 (in each case until their respective successors
are duly elected and qualified). At the Annual Meeting, three
Class II directors will be elected for three year terms.
The Board of Directors has designated the three
nominees listed below for election as Class II directors of the
Company for terms expiring in 1997. The Common Shares
represented by the enclosed proxy, if returned duly executed and
not properly revoked, will be voted as specified thereon, or if
no instructions are given, for the Board's nominees; however, the
persons designated as proxies reserve full discretion to vote the
Common Shares represented by the proxies for the election of the
remaining nominees and any substitute nominee or nominees
designated by the Board in the event the nominee who would
otherwise receive the votes is unavailable or unable to serve as
a candidate for election as a director. The Board of Directors
has no reason to believe that any of the nominees will be
unavailable or unable to serve if elected to the Board.
Under Delaware law and the Company's By-Laws, the three
nominees for election as Class II directors receiving the
greatest number of votes will be elected as Class II directors.
The following table sets forth the nominees for
election to the Board of Directors, the directors of the Company
whose terms in office will continue after the Annual Meeting, and
certain information with respect to each nominee and director.
Unless otherwise indicated, each person has held his or her
principal occupation for more than five years.
Name, Age and Year Principal Occupation for Past
Became Director; Five Years and Other Information
Positions and Offices
with the Company
NOMINEES - TERMS TO EXPIRE IN 1997 (Class II)
Larry C. Corbin, age Senior Group Vice President -
52; Senior Group Vice Restaurant Operations Group of the
President - Restaurant Company since January, 1994. Group
Operations Group of the Vice President - Business Development
Company; Director since from 1990 to December, 1993, Executive
1981. Vice President, Operations and
Development, Restaurant Division,
from 1988 to 1990, Senior Vice
President, Operations and
Development, Restaurant Division,
from 1987 to 1988, and Senior Vice
President, Operations, Restaurant
Division, from 1974 to 1987, of the
Company.
Stewart K. Owens, age
39; Executive Vice
President and Chief
Operating Officer of
the Company; Director
since 1987. Executive Vice President and Chief
Operating Officer of the Company
since January, 1994. Group Vice
President -Food Products of the
Company from 1990 to December, 1993.
President and Chief Operating Officer
of Owens Country Sausage, Inc., a
subsidiary of the Company, since
1984.
Robert E. H. Rabold,
age 55; Director since
1994. (1) Chairman, President and Chief
Executive Officer of Motorists Mutual
Insurance Company and its various
subsidiaries, Columbus, Ohio;
Chairman, President and Chief
Executive Officer of American
Hardware Mutual Insurance Company and
its various subsidiaries, Columbus,
Ohio, since 1993.
[FN]
_______________________
<F1> Mr. Rabold was appointed to the Board of Directors of the
Company on June 10, 1994, to fill the vacancy created by the
resignation of Lawrence E. Carroll.
CONTINUING DIRECTORS - TERMS TO EXPIRE IN 1995 (Class III)
Daniel E. Evans, age
57; Chairman of the
Board, Chief Executive
Officer and Secretary
of the Company;
Director since 1957. Chairman of the Board, Chief
Executive Officer and Secretary of
the Company. Mr. Evans is the first
cousin of J. Tim Evans.
J. Tim Evans, age 67;
Director since 1957. Director of the Company. Mr. Evans
is the first cousin of Daniel E.
Evans.
Robert S. Wood, age 66;
Director since 1957. Director of the Company. Vice
Chairman from 1990 to 1992, and
Executive Vice President and Chief
Operating Officer, Restaurant
Division, and Vice President, Sausage
Division, from 1974 to 1990, of the
Company.
CONTINUING DIRECTORS - TERMS TO EXPIRE IN 1996 (Class I)
Daniel A. Fronk, age
58; Director since
1981. Senior Executive Vice President and
Board Member of The Ohio Company, an
investment banking firm, Columbus,
Ohio. (2)
Cheryl L. Krueger, age
42; Director since
1993. President and Chief Executive Officer
of Cheryl & Co., a manufacturer and
retailer of gourmet foods and gifts,
Columbus, Ohio.
G. Robert Lucas II, age
50; Director since
1986.
Partner in Vorys, Sater, Seymour and
Pease, Attorneys at Law, Columbus,
Ohio, since 1990. Prior thereto, he
was of counsel to Vorys, Sater,
Seymour and Pease beginning in 1988.
(3)
[FN]
_______________________
<F2> The Ohio Company rendered various investment banking ser-
vices to the Company during the Company's 1994 fiscal year,
and continues to do so.
<F3> Vorys, Sater, Seymour and Pease is general counsel to the
Company. It rendered legal services to the Company during
the Company's 1994 fiscal year, and continues to do so.
Daniel E. Evans, a director of The Sherwin-Williams
Company and National City Corporation, is the only nominee or
continuing director who is also a director of any other company
with a class of securities registered pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or which
is otherwise subject to the reporting requirements of the
Exchange Act, or any company registered as an investment company
under the Investment Company Act of 1940.
The Company's Board of Directors has standing Audit,
Compensation and Stock Option Committees. There is no standing
Nominating Committee or committee performing similar functions.
The Audit Committee consists of Messrs. J. Tim Evans,
Daniel A. Fronk and G. Robert Lucas II. The Audit Committee
reviews the services performed and to be performed by the
Company's principal accountant, the cost of such services and the
quarterly financial statements of the Company. The Audit
Committee met three times during the 1994 fiscal year.
The Compensation Committee consists of Messrs. J. Tim
Evans, Daniel A. Fronk and G. Robert Lucas II and Ms. Cheryl L.
Krueger. The Compensation Committee reviews and recommends to
the Board of Directors of the Company the salaries, bonuses and
other cash compensation to be paid to executive officers of the
Company and the other non-stock-based benefits to be received by
such executive officers. The Compensation Committee met five
times during the 1994 fiscal year.
The Stock Option Committee consists of Messrs. J. Tim
Evans, Daniel A. Fronk, G. Robert Lucas II and Robert S. Wood.
The Stock Option Committee administers the Company's stock option
plans pursuant to which employee stock options are granted,
selects or nominates for selection those eligible employees who
may participate in each stock option plan (where selection is
required) and prescribes the terms of any stock options granted
under the stock option plans. The Stock Option Committee met
three times during the 1994 fiscal year.
The Board of Directors had a total of seven meetings
during the 1994 fiscal year. None of the directors attended
fewer than 75% of the aggregate of the total number of Board
meetings and the total number of meetings held by committees of
the Board on which he or she served during the period he or she
served.
REPORT OF THE COMPENSATION COMMITTEE AND THE STOCK OPTION
COMMITTEE OF THE BOARD OF DIRECTORS ON EXECUTIVE COMPENSATION
Notwithstanding anything to the contrary set forth in
any of the Company's previous filings under the Securities Act of
1933, as amended, or the Exchange Act that might incorporate
future filings, including this Proxy Statement, in whole or in
part, this Report and the graph set forth on page 14 shall not be
incorporated by reference into any such filings.
Administration
The Company's compensation policies for its executive
officers are administered by two committees of the Board of
Directors -- the Compensation Committee and the Stock Option
Committee. All members of each committee are non-employee
directors. The compensation policies are intended to enhance the
financial performance of the Company by aligning the financial
interests of the Company's executive officers with those of its
stockholders.
The primary components of executive compensation are
base salary, cash bonus and longer-term incentives such as stock
option grants. The Compensation Committee recommends to the
Board of Directors the salaries and bonuses of the executive
officers and the Stock Option Committee administers the stock
option plans pursuant to which employee stock options are
granted. In addition, the salary and bonus components of
executive compensation are reviewed for competitiveness in
relation to a group of companies in the restaurant and food
products businesses by independent consultants specializing in
executive compensation. It is not known whether the group used
by the executive compensation consultants is the same group as
that included in the performance graph on page 14 of this Proxy
Statement.
The Company is currently formulating a policy with
respect to qualifying compensation paid to its executive officers
for deductibility under Section 162(m) of the Internal Revenue
Code of 1986, as amended. The Company has begun to review its
existing compensatory plans in light of the proposed regulations
issued by the Internal Revenue Service on December 15, 1993 for
the purpose of giving guidance about how to qualify compensatory
plans so as to satisfy the "performance-based compensation"
exception to the applicability of Section 162(m); however, such
review has not been completed and no determination has been made
as to whether the Company will attempt to qualify its existing
compensatory plans for the "performance-based compensation"
exclusion. As noted in the section entitled "PROPOSAL TO APPROVE
THE BOB EVANS FARMS, INC. 1994 LONG TERM INCENTIVE PLAN --
Federal Income Tax Consequences -- Other Matters," the proposed
Bob Evans Farms, Inc. 1994 Long Term Incentive Plan is intended
to satisfy the requirements for a "performance-based
compensation" plan. The Company expects to complete its review
of its other compensatory plans as well as the other compensation
payable to its executive officers in light of the provisions of
Section 162(m) and any regulations which may have promulgated
thereunder next year and appropriate disclosure will be included
in next year's Proxy Statement as to the conclusions reached and
actions to be taken.
Overall Philosophy
The Company has adopted a Total Compensation System
which is intended to provide executive officers with a
competitive salary, while at the same time emphasizing the bonus
and long-term components of total compensation. All management
employees of the Company (including the five executive officers
named in the Summary Compensation Table) have been placed in one
of 18 pay grades, each pay grade being commensurate with the
duties undertaken by each such employee. Each pay grade is
assigned a minimum, midpoint and maximum salary range as well as
a minimum, midpoint and maximum total compensation range. The
dollar amounts comprising the minimum, midpoint and maximum
ranges were derived by Company personnel, working with executive
compensation consultants, from comparisons to companies in
similar lines of business with the Company as published in
compensation surveys.
Base Salary
Historically, the Company has paid base salaries to its
executive officers in a range toward the minimum of salaries paid
by other similarly situated companies, relying on year-end
bonuses to keep total compensation competitive. Salaries for the
Company's executive officers at the beginning of the 1994 fiscal
year were at or near the minimum range in each pay grade. During
the 1994 fiscal year, a decision was made to increase the base
salary component of total compensation for executive officers to
make salaries more competitive with those paid by the Company's
competitors and to move salaries toward the midpoint of the range
in each pay grade. In October, 1993, therefore, the Compensation
Committee met and approved management's recommendation to
increase the base salaries of the executive officers, including
Daniel E. Evans and the four other executive officers named in
the Summary Compensation Table, to levels nearer the midpoint of
their respective pay grades.
Bonuses
At the beginning of the 1994 fiscal year, each
executive officer agreed upon written goals to be accomplished by
him or her during the fiscal year. Different goals were set for
each executive officer--some involving overall Company
performance (such as performance of the Common Shares, increase
in net income, increase in sales and cost savings) and some
specific to the performance of the particular executive officer
(such as personnel management, financial presentations and
community service). Each goal was weighted (the total weighing
of all goals adding to 100%) and at the end of the fiscal year,
each executive officer was graded by one or more of his or her
peers. Based on the grades received by each executive officer
and the subjective evaluations of the Compensation Committee and
the person to whom such executive officer reports, bonuses were
awarded to each executive officer.
The performance of Daniel E. Evans was evaluated on the
same basis as the performance of the other four executive
officers named in the Summary Compensation Table. That is, goals
were set at the beginning of the fiscal year and Mr. Evans was
graded with respect to each such goal. Mr. Evans' bonus for 1994
is reflective of the decision of the Compensation Committee that
he exceeded his goals during fiscal 1994 and that his performance
merited the bonus received.
Stock Option Plans
In contrast to salary and bonuses, stock option grants
are tied directly to stock price performance. The Stock Option
Committee grants incentive stock options ("ISOs") under
stockholder-approved stock option plans with an exercise price
equal to the market value of the Company's Common Shares on the
date of grant. If there is no appreciation in the market value
of the Company's Common Shares, the options are valueless.
In addition, grants of non-qualified stock options
("NQSOs") are made to fund the Company's Supplemental Executive
Retirement Plan (the "SERP"). The SERP is an unfunded plan, the
purpose of which is to retain key employees by providing
retirement benefits in excess of benefits available under
qualified retirement plans. While the exercise price of the
NQSOs is less than the market value of the Company's Common
Shares on the date of grant, benefits under the SERP will not
reach their actuarially assumed values if the Company's Common
Shares do not appreciate at a predetermined rate. No future
adjustments to or grants of NQSOs will be made to match actual
values of the NQSOs with the assumed value of such NQSOs at the
date of grant.
At the 1992 Annual Meeting, the stockholders of the
Company approved the Company's Nonqualified Stock Option Plan
(the "Nonqualified Plan"). The purpose of the Nonqualified Plan
is to use grants of NQSOs to fund benefits earned under the SERP.
During the 1994 fiscal year, the Stock Option Committee made
grants of NQSOs to executive officers (including Daniel E. Evans)
in amounts determined to be necessary to fund benefits accrued
under the SERP during the 1993 fiscal year, given the years of
service and current compensation of each participant. It is
anticipated that the Stock Option Committee will make additional
grants of NQSOs annually to meet the funding requirements of the
SERP.
In October, 1993, the Stock Option Committee approved
the grant of ISOs to certain key employees, including the five
executive officers named in the Summary Compensation Table. Each
ISO was granted at the fair market value of the Company's Common
Shares on the date of grant and is exercisable in 20% per year
increments beginning on the date of grant. The number of ISOs
granted to each executive officer named in the Summary
Compensation Table increased substantially from the number
granted in 1990. The Stock Option Committee felt this increase
was justified when it compared the number of options historically
granted to executive officers of the Company to those granted by
other companies of similar size and in similar lines of business.
Other Compensation
Each of the executive officers listed in the Summary
Compensation Table participates in the Bob Evans Farms, Inc. and
Affiliates 401K Retirement Plan (the "401K Plan"). In 1994, the
Board of Directors voted to contribute $3,015,000 to the 401K
Plan. Each participant in the 401K Plan received a pro rata
share of this contribution and a pro rata share of forfeitures
reallocated to participants (such pro rata share, in each case,
based upon such participant's eligible compensation). In
addition, each participant had the option of contributing up to
7% of his or her compensation (up to a maximum contribution of
$8,994) to the 401K Plan. In cases where participants made
voluntary contributions to the 401K Plan, the Company contributed
$0.25 for each $1.00 of voluntary contributions.
Submitted By:
Compensation Committee Members Stock Option Committee Members
G. Robert Lucas II, Chairman Daniel A. Fronk, Chairman
J. Tim Evans J. Tim Evans
Daniel A. Fronk G. Robert Lucas II
Cheryl L. Krueger Robert S. Wood
COMPENSATION COMMITTEE AND STOCK OPTION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
G. Robert Lucas II, who is a partner in the law firm of
Vorys, Sater, Seymour and Pease, which rendered legal services to
the Company during the Company's 1994 fiscal year and continues
to do so, serves as a member of the Compensation Committee and of
the Stock Option Committee of the Company's Board of Directors.
Daniel A. Fronk, who is Senior Executive Vice President and a
Board Member of The Ohio Company, which rendered various
investment banking services to the Company during the Company's
1994 fiscal year and continues to do so, also serves as a member
of the Compensation Committee and of the Stock Option Committee.
J. Tim Evans, who held various positions as an officer of the
Company until his retirement in 1981, also serves as a member of
the Compensation Committee and of the Stock Option Committee.
Robert S. Wood, who held various positions as an officer of the
Company until his retirement in 1992, also serves as a member of
the Stock Option Committee.
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
Summary of Cash and Certain Other Compensation
The following table summarizes, for the fiscal years
ended April 29, 1994, April 30, 1993 and April 24, 1992, cash
compensation paid by the Company to, as well as certain other
compensation paid or earned for those years by, the Company's
Chief Executive Officer and the four other most highly
compensated executive officers of the Company in all capacities
in which they served.
SUMMARY COMPENSATION TABLE
Annual Compensation Long Term Compensation
Awards
Securities
Name and Underlying All Other
Principal Fiscal Salary Bonus Options/ Compensation
Position Year ($)(1) ($) SARs (#) ($)(3)(4)
Daniel E. Evans: 1994 $307,834 $358,669 30,676(2) $2,770
Chairman of the 1993 $236,300 $360,000 83,253(2) $2,678
Board, Chief 1992 $215,400 $319,141 -0- --
Executive Officer
and Secretary
Stewart K. Owens: 1994 $164,896 $186,070 16,055(2) $2,770
Executive Vice 1993 $120,800 $173,000 5,425(2) $2,678
President and Chief 1992 $110,000 $156,948 -0- --
Operating Officer
Larry C. Corbin: 1994 $157,734 $177,422 11,228(2) $2,770
Senior Group Vice 1993 $120,800 $173,000 15,625(2) $2,678
President- 1992 $110,400 $156,948 -0- --
Restaurant
Operations Group
Roger D. Williams: 1994 $146,934 $164,400 10,050(2) $2,945
Senior Group Vice 1993 $110,000 $173,000 8,928(2) $3,256
President - Food 1992 $100,000 $156,948 -0- --
Products/Marketing/
Purchasing/Technical
Services Group
Howard J. Berrey: 1994 $125,307 $146,500 12,065(2) $2,945
Group Vice 1993 $110,000 $137,000 15,603(2) $3,256
President of 1992 $100,000 $120,326 -0- --
Real Estate -
Construction &
Engineering Group
<FN>
________________________
<F1> "Salary" includes director's fees received by Messrs. Evans,
Owens and Corbin during each of the 1994 and 1993 fiscal
years in the amount of $10,800 each and during the 1992
fiscal year in the amounts of $10,400, $10,400, and $10,000,
respectively.
<F2> See the table under "Grants of Options."
<F3> In accordance with the transition provisions of the revised
rules governing the disclosure of executive compensation
adopted by the SEC, amounts of "All Other Compensation" are
excluded for the Company's 1992 fiscal year.
<F4> Includes Company contributions to the 401K Plan during the
1994 and 1993 fiscal years.
Grants of Options
The following table sets forth information concerning
individual grants of options made during the 1994 fiscal year to
each of the named executive officers. The Company has never
granted stock appreciation rights.
OPTION GRANTS IN LAST FISCAL YEAR
Individual Grants
Potential
Number of % of Realizable Value at
Securities Total Options Assumed Annual Rates of
Underlying Granted to Stock Price Appreciation
Options Employees in Exercise Market Expiration for Option Term (1)
Name Granted(#)(1) Fiscal Year Price($/Sh) Price($/Sh) Date 0% 5% 10%
Daniel E. Evans 10,676(2) 17.3% $ 8.69 $17.375 (2) $92,721 $174,839 $320,098
20,000(3)(4) 2.4% $19.00 $19.00 10/28/98 $ 0 $104,987 $231,994
Stewart K. Owens 1,055(2) 1.7% $ 8.69 $17.375 (2) $ 9,163 $ 41,582 $175,878
8,800(3)(4) 1.1% $19.00 $19.00 10/28/98 $ 0 $ 46,194 $102,077
6,200(4)(5) 0.7% $20.187 $20.187 04/14/99 $0 $ 34,579 $ 76,411
Larry C. Corbin 2,428(2) 3.9% $ 8.69 $17.375 (2) $21,087 $ 50,748 $117,242
8,800(3)(4) 1.1% $19.00 $19.00 10/28/98 $ 0 $ 46,194 $102,077
Roger D. Williams 1,250(2) 2.0% $ 8.69 $17.375 (2) $10,856 $ 40,530 $142,322
8,800(3)(4) 1.1% $19.00 $19.00 10/28/98 $ 0 $ 46,194 $102,077
Howard J. Berrey 3,265(2) 5.3% $ 8.69 $17.375 (2) $28,357 $ 68,244 $157,662
8,800(3)(4) 1.1% $19.00 $19.00 10/28/98 $ 0 $ 46,194 $102,077
<FN>
________________________
<F1> The amounts reflected in this table represent certain
assumed rates of appreciation only. Actual realized
values, if any, on option exercises will be dependent on
the actual appreciation in the price of the Common Shares
of the Company over the term of the options. There can be
no assurances that the Potential Realizable Values
reflected in this table will be achieved.
<F2> These are non-qualified stock options ("NQSOs") granted
under the Nonqualified Plan to fund and settle benefits
earned under the SERP. These NQSOs are intended to
encourage executive officers to remain in the employ of the
Company until retirement and to provide them with a
supplemental retirement benefit. The NQSOs become
exercisable when the executive officer attains age 55 and
has completed 10 years of service with the Company or
attains age 62 while employed by the Company, whichever is
earlier, upon the death of the executive officer or upon
the occurrence of a change in control of the Company
(subject to the limitation that they be exercised within
three months following the change in control or the
restrictions on exercisability again apply). No NQSOs may
be exercised, however, for a period of six months following
the date of grant. If an executive officer terminates
employment with the Company for any reason other than death
or retirement, his NQSOs will be forfeited unless the Stock
Option Committee of the Company's Board of Directors
permits the exercise of the NQSOs. The NQSOs expire on the
date which is five years after the earlier of the date the
executive officer attains age 65 or the date of his death.
The Potential Realizable Values of the NQSOs assume an
expiration date of five years after each executive officer
attains age 65.
<F3> These options were granted on October 29, 1993 and become
exercisable in 20% per year increments beginning on the
date of grant.
<F4> If the Company liquidates or dissolves, or is a party to a
merger or consolidation in which the Company is not the
surviving corporation, other than a merger or consolidation
involving only a change in the state of incorporation or an
internal reorganization not involving a change in
underlying ownership, the options become fully exercisable
for a period of 30 days prior to the effective date of the
transaction and terminate on such effective date. If the
executive officer leaves the employment of the Company for
any reason, including death, the portion of the options
then exercisable may be exercised for a period of three
months following the termination of employment, subject to
the term of the options.
<F5> This option was granted on April 15, 1994 and becomes
exercisable in 20% per year increments beginning on the
date of grant.
Option Exercises and Holdings
The following table sets forth certain information with
respect to options exercised during the 1994 fiscal year by each
of the named executive officers and unexercised options held as
of the end of the 1994 fiscal year by such executive officers.
>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
Number of Number of
Securities Securities Underlying Value of Unexercised
Underlying Unexercised Options at In-the-Money Options at
Options Value Fiscal Year-End(#) Fiscal Year-End($)(1)(2)
Name Exercised(#) Realized($)(1) Exercisable Unexercisable Exercisable Unexercisable
Daniel E. Evans 4,136 $28,575 101,662 16,000 $1,197,213 $36,000
Stewart K. Owens 997 $ 7,137 6,733 18,480 $ 49,957 $ 97,087
Larry C. Corbin 1,496 $10,709 5,493 25,093 $ 48,639 $226,992
Roger D. Williams 1,320 $ 9,780 4,960 17,218 $ 42,260 $134,766
Howard J. Berrey 1,320 $ 9,450 4,960 25,908 $ 42,260 $237,250
<FN>
__________________________
<FN1> All values are shown pre-tax and are rounded down to the
nearest whole dollar.
<F2> Based on the 1994 fiscal year-end closing price of $21.25
per Common Share.
Compensation of Directors
Each director who is not a salaried officer of the
Company receives a monthly fee of $1,800 (and an additional $400
for each committee meeting attended), and each director who is a
salaried officer of the Company receives a monthly fee of $900.
If a director does not attend a scheduled meeting of the Board of
Directors, he or she will have $450 deducted from the amount of
the monthly fee he or she would have received for the month of
such meeting. Each director is reimbursed for out-of-pocket
expenses incurred in attending meetings. The Company maintains a
life insurance policy with a death benefit of $50,000 on behalf
of each director of the Company.
Directors of the Company who are not employees of the
Company or of any of its subsidiaries (the "Nonemployee
Directors") also receive grants of non-qualified stock options
under the Bob Evans Farms, Inc. 1989 Stock Option Plan for
Nonemployee Directors (the "Nonemployee Directors Plan"). The
Nonemployee Directors Plan provides that the aggregate number of
Common Shares for which options may be granted is 73,333. The
Nonemployee Directors Plan provides for the automatic grants of
options for 3,080 Common Shares effective June 16, 1989, options
for 5,133 Common Shares effective May 1, 1991, and options for
5,133 Common Shares effective on May 1, 1996, to each person who
was or is a Nonemployee Director on the applicable date. Each
person who was not a member of the Board on May 1, 1991, who is
subsequently elected to the Board prior to May 1, 1996, and who
is a Nonemployee Director will automatically receive options to
purchase 5,133 Common Shares effective on the date of the first
meeting of the Board after his or her election. Each person who
was not a member of the Board on May 1, 1996, who is subsequently
elected to the Board prior to May 1, 2001, and who is a
Nonemployee Director will automatically receive options to
purchase 5,133 Common Shares effective on the date of the first
meeting of the Board after his or her election. The exercise
price per share of each option will be equal to the fair market
value of a Common Share on the date of grant and will
automatically be adjusted to reflect stock dividends and stock
splits. Options become exercisable over a period of time and
have terms of five years.
Severance Arrangements
From February, 1989 through September, 1990, the
Company entered into agreements with the five executive officers
named in the Summary Compensation Table. These agreements, which
are substantially identical, had initial terms ending on April
30, 1990 and April 30, 1991 (which were, and will continue to be,
automatically extended for one year periods unless either party
gives notice of his or its decision not to renew) and provide
that in the event of the executive officer's termination of
employment under certain circumstances during the 36-month period
(the "Effective Period") following a "change of control" of the
Company, the executive officer will be entitled to certain
severance benefits. Prior to such change of control, the
executive officer will remain an employee at will of the Company.
Each agreement will terminate automatically on the
death or retirement of the executive officer to whom it relates,
and may be terminated at the option of the Company upon
disability of the executive officer or for "cause" (as that term
is defined in the agreement) or, at the option of the executive
officer, for other than "good reason," in all of which cases no
additional severance payments, other than accrued compensation
and benefits customarily paid to employees in such circumstances,
will be due the executive officer.
If the executive officer terminates the agreement
during the Effective Period for "good reason," or, if the Company
terminates the agreement during such period for any reason other
than for "cause" (as that latter term is defined in the
agreement) or as a result of the executive officer's death,
retirement or disability, the Company will be obligated to pay
the executive officer his base salary and prorated bonus through
the date of termination and (A) to make a lump-sum payment to the
executive officer equal to 2.99 times the average annual compen-
sation (including salary and bonus) which was payable to the
executive officer for the five taxable years ending prior to the
date on which the change of control occurred; (B) to continue
health and life insurance and other employee welfare benefit
plans for the executive officer and his family for a period of 36
months following the date of termination; (C) to allow the
executive officer to exercise in full any stock options held by
the executive officer which were not fully exercisable on the
termination date; and (D) to pay to the executive officer in one
lump sum in cash, at the executive officer's normal retirement
age, an amount equal to the actuarial equivalent of the
retirement pension to which the executive officer would have been
entitled under such retirement plan had he accumulated 36
additional months of continuous service after the termination
date. As of April 29, 1994, the amount of the lump-sum payment
to Messrs. Evans, Owens, Corbin, Williams and Berrey would have
been approximately $1,417,000, $677,000, $772,000, $679,000 and
$597,000, respectively.
If any portion of the payments and benefits provided
for in an agreement would be considered "parachute payments"
within the meaning of Section 280G(b)(2) of the Internal Revenue
Code of 1986, as amended, so as to be nondeductible by the
Company, then the aggregate present value of all of the amounts
and benefits payable to the executive officer to whom such
agreement relates will be reduced at the election of the
executive officer to the maximum amount which would cause all of
the payments and benefits to be deductible by the Company.
For purposes of each agreement, the executive officer
to whom it relates may terminate his employment for "good reason"
during the Effective Period if his title, duties,
responsibilities, compensation or benefits are reduced, if he is
required to relocate or if the agreement is breached by the
Company. A "change of control" is defined to include, among
other events, the acquisition by any individual, entity or group
of stock entitling such individual, entity or group to exercise
20% or more of the voting power of the Company or a change in a
majority of the current directors of the Company, unless the
election or nomination for election of the successor directors
was approved by a vote of at least three-quarters of the
incumbent directors.
PERFORMANCE GRAPH
Comparison of Five Year Cumulative Total Return
The following line graph compares the yearly percentage
change in the Company's cumulative total stockholder return (as
measured by dividing (i) the sum of (A) the cumulative amount of
dividends for the measurement period, assuming dividend reinvest-
ment, and (B) the difference between the price of the Company's
Common Shares at the end and the beginning of the measurement
period; by (ii) the price of the Common Shares at the beginning
of the measurement period) against the cumulative total return of
the Standard & Poor's 500 Stock Index ("S&P 500") and the
weighted average of the NASDAQ Restaurants and Food Manufacturers
Indices (Restaurants are weighted 70% and Food Manufacturers 30%
to reflect the Company's business mix) ("NASDAQ Restaurant/Food
Mfg. Peer") for the five year period ended April 29, 1994. Stock
prices and dividends of the Company have been adjusted for stock
splits and stock dividends.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
AMONG BOB EVANS FARMS, INC., S&P 500
AND NASDAQ RESTAURANT/FOOD MFG. PEER
[Performance Graph was submitted under Form SE]
PROPOSAL TO APPROVE
THE BOB EVANS FARMS, INC.
1994 LONG TERM INCENTIVE PLAN
On April 15, 1994, the Board of Directors of the
Company adopted, subject to approval by the stockholders, the Bob
Evans Farms, Inc. 1994 Long Term Incentive Plan (the "1994
Plan"). The purpose of the 1994 Plan is to attract and retain
outstanding individuals as officers and other key employees of
the Company and its subsidiaries and to furnish incentives to
such persons by providing them opportunities to acquire Common
Shares of the Company on advantageous terms. The 1994 Plan is
designed to permit the Company to provide several different forms
of benefits to meet competitive conditions and the particular
circumstances of the individuals who may be eligible to receive
benefits. To accomplish this purpose, the 1994 Plan authorizes
the grant of incentive stock options ("ISOs") as defined in
Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), non-qualified stock options ("NQSOs") (ISOs and NQSOs
are herein referred to collectively as "Stock Options") and
Performance Share Awards (Stock Options and Performance Share
Awards are herein referred to collectively as "Awards").
The Company also maintains the 1985 Incentive Stock
Option Plan (the "1985 ISO Plan"), the 1987 Incentive Stock
Option Plan (the "1987 ISO Plan") and the 1991 Incentive Stock
Option Plan (the "1991 ISO Plan") (collectively, the "Prior ISO
Plans") under which ISOs may be granted to key employees of the
Company and its subsidiaries. As of April 29, 1994, a total of
52,450 Common Shares remained available for the grant of ISOs
under the Prior ISO Plans. The Board believes that the number of
Common Shares remaining available for the grant of new ISOs under
the Prior ISO Plans is not sufficient to satisfy stock option
grants which the Company expects to make over the next several
years. The Board also believes that the Company should have the
flexibility to grant NQSOs and Performance Share Awards as well
as ISOs to meet competitive conditions and the particular
circumstances of the individuals who may be eligible to receive
Awards. For these reasons, the Board is recommending the
adoption of the 1994 Plan which will make an additional 1,000,000
Common Shares available for the grant of ISOs, NQSOs and
Performance Share Awards. The 1,000,000 Common Shares to be
reserved for issuance under the 1994 Plan are equal to
approximately 2.4% of the Company's outstanding Common Shares as
of June 17, 1994. On June 17, 1994, the closing sale price of
the Company's Common Shares on the NASDAQ National Market System
was $21.75.
Officers and other full-time employees of the Company
and its subsidiaries (collectively, the "Key Employees") selected
by the Stock Option Committee will be eligible to receive Stock
Options and/or Performance Share Awards under the 1994 Plan. As
of the date of this Proxy Statement, no determination has been
made regarding the identity of the Key Employees to whom Awards
may be made under the 1994 Plan or the number and type of Awards
that will be made to any such Key Employee. The Company
estimates that approximately 900 employees of the Company and its
subsidiaries will be eligible to receive Awards under the 1994
Plan, including the five executive officers named in the Summary
Compensation Table.
The Common Shares covered by the 1994 Plan may be
either authorized but unissued shares or treasury shares. If
there is a lapse, expiration, termination or cancellation of any
Award granted under the 1994 Plan without the issuance of Common
Shares or payment of cash thereunder, or if Common Shares are
issued under any Award and thereafter are reacquired by the
Company pursuant to rights reserved upon the issuance thereof, in
each case so long as the holder thereof has not received any
benefits of ownership of such Common Shares, the Common Shares
subject to or reserved for such Award may again be used for new
Stock Options or Performance Share Awards under the 1994 Plan.
The following summary of certain provisions of the 1994
Plan is qualified in its entirety by reference to the copy of the
1994 Plan attached hereto as Exhibit A.
Administration
The 1994 Plan will be administered by the Stock Option
Committee (the "Committee"). None of the members of the
Committee is an officer or employee of the Company or of any of
its subsidiaries. The Committee will grant Awards under the 1994
Plan, interpret the 1994 Plan and make all determinations
necessary for the administration of the 1994 Plan.
It is the intention of the Committee to make no
decisions with respect to the granting of Awards under the 1994
Plan until after the 1994 Plan has been approved by the
stockholders. Because the granting of Awards is at the sole
discretion of the Committee, the identity of the persons to whom
Awards may be granted and the number of Common Shares which may
be allocated to any specific individual are not presently
determinable.
Duration
Any grant of an Award under the 1994 Plan must be made
before April 14, 2004.
Adjustments
The 1994 Plan provides for adjustment in the number of
Common Shares reserved for issuance under the 1994 Plan and in
the number and exercise price of Common Shares covered by each
outstanding Award in the event of a stock dividend or stock split
and for continuation of Awards or other equitable adjustments in
the event of changes in the Common Shares resulting from a
reorganization, sale, merger, consolidation or similar
occurrence.
Terms of Awards
Option Exercise Price; Term of Stock Options; Limitations
The option exercise price of each Stock Option granted
under the 1994 Plan will be determined by the Committee and may
not be less than 100% of the fair market value of the Company's
Common Shares on the date of grant. Fair market value is defined
as the last reported sales price of the Company's Common Shares
on the relevant date, as reported in the NASDAQ National Market
System. The period during which any Stock Option may be
exercised will be determined by the Committee, but no Stock
Option may be exercised after the expiration of ten years from
the date it is granted.
Under the 1994 Plan, no Key Employee will be eligible
to receive an ISO if, at the time of grant, such Key Employee
owns of record and beneficially shares representing more than 10%
of the total combined voting power of all classes of stock of the
Company unless the option exercise price is at least 110% of the
fair market value of the Common Shares covered by the ISO on the
date of grant and the option term does not exceed five years. No
Key Employee may be granted ISOs under the 1994 Plan if it would
cause the aggregate fair market value (determined as of the date
an ISO is granted) of the Common Shares with respect to which
ISOs are exercisable for the first time by such Key Employee
during any calendar year under the 1994 Plan and all other stock
option plans maintained by the Company and its subsidiaries to
exceed $100,000. In addition, during the period in which the
1994 Plan remains in effect, no Key Employee may be granted
Awards under the 1994 Plan covering, in the aggregate, more than
250,000 Common Shares.
Exercise of Stock Options
The Committee may provide for the payment of the option
exercise price of Common Shares subject to a Stock Option in
cash, by delivery of already owned Common Shares of the Company
having a fair market value equal to the option exercise price of
such Common Shares, or by delivery of an exercise notice
accompanied by a copy of irrevocable instructions to a broker to
deliver promptly to the Company sale or loan proceeds to pay the
option exercise price. A Stock Option may be exercised only
after six months from its grant date. The 1994 Plan contains
special rules governing the time of exercise of Stock Options in
cases of retirement, death, disability, or other termination of
employment. The 1994 Plan also provides that, upon the
occurrence of a "Change in Control" (as defined in the 1994 Plan)
of the Company, all Stock Options which have been outstanding for
at least six months (whether or not then exercisable) will become
fully exercisable as of the date of the Change in Control.
Performance Share Awards
The Committee may grant Performance Share Awards under
which payment may be made in Common Shares, cash or a combination
of Common Shares and cash if the performance of the Company or
any subsidiary of the Company selected by the Committee meets
certain goals established by the Committee. The Committee will
determine the performance goals (which may include earnings per
share, return on stockholders' equity, return on assets, net
income or any other financial or other measure established by the
Committee), the length of a performance period, the maximum
payment value of a Performance Share Award and the minimum
performance required before a payment will be made. The
Committee may revise the goals and the computation of payment to
account for unforeseen events which occur during a performance
period and which have a substantial effect on the performance of
the Company or subsidiary.
In order to receive payment under a Performance Share
Award, the holder thereof must remain in the employ of the
Company or a subsidiary until the completion of the performance
period, except that the Committee may provide complete or partial
exemptions to that requirement as it deems equitable.
Transferability of Awards
Each Stock Option and Performance Share Award granted
under the 1994 Plan will not be transferable other than by will
or the laws of descent and distribution, and Stock Options will
be exercisable, during a participant's lifetime, only by the
participant or the participant's guardian or legal
representative.
Amendments and Discontinuance
The Committee, with the approval of the Board of
Directors, may amend the 1994 Plan from time to time or terminate
the 1994 Plan at any time without the approval of the
stockholders of the Company except as such stockholder approval
may be required (a) to satisfy the requirements of Rule 16b-3
under the Exchange Act, (b) to satisfy applicable requirements of
the Code or (c) to satisfy applicable requirements of any
national securities exchange on which any of the Company's equity
securities may then be listed or of the NASDAQ National Market
System. No such action may, without the consent of the
participant, reduce the amount of any existing Award of such
participant or adversely change the terms and conditions thereof.
The terms and conditions applicable to any outstanding
Award may at any time be amended, modified or cancelled, without
stockholder approval, by mutual agreement between the Committee
and the participant so long as stockholder approval of such
amendment, modification or cancellation is not required to
satisfy the requirements of Rule 16b-3, to satisfy applicable
provisions of the Code or to satisfy any applicable requirements
of any stock exchange on which any of the Company's equity
securities are then listed or of the NASDAQ National Market
System. The Committee may, at any time and in its sole
discretion, declare any or all Stock Options then outstanding
under the 1994 Plan to be exercisable, whether or not such Stock
Options are otherwise exercisable.
Federal Income Tax Consequences
Based on current provisions of the Code and the
existing regulations thereunder, the anticipated federal income
tax consequences in respect of Stock Options and Performance
Share Awards granted under the 1994 Plan are as described below.
The following discussion is not intended to be a complete
statement of applicable law and is based upon the federal income
tax laws as in effect on the date hereof.
ISOs
In general, a participant who is granted an ISO does
not recognize taxable income either on the date of grant or on
the date of exercise. However, upon the exercise of an ISO, the
difference between the fair market value of the Common Shares of
the Company received and the option price is a tax preference
item potentially subject to the alternative minimum tax.
However, on the later sale or other disposition of the Common
Shares, generally only the difference between the fair market
value of the Common Shares on the exercise date and the amount
realized on the sale or disposition is includable in alternative
minimum taxable income.
Upon disposition of Common Shares acquired from
exercise of an ISO, long-term capital gain or loss is generally
recognized in an amount equal to the difference between the
amount realized on the sale or disposition and the exercise
price. However, if the participant disposes of the Common Shares
within two years of the date of grant or within one year from the
date of the issuing of the Common Shares to the participant (a
"Disqualifying Disposition"), then the participant will recognize
ordinary income, as opposed to capital gain, at the time of
disposition. In general, the amount of ordinary income
recognized will be equal to the lesser of (i) the amount of gain
realized on the disposition, or (ii) the difference between the
fair market value of the Common Shares received on the date of
exercise and the exercise price. Any remaining gain or loss is
treated as a short-term or long-term capital gain or loss,
depending upon the period of time the Common Shares have been
held.
The Company is not entitled to a tax deduction upon
either exercise of an ISO or disposition of Common Shares
acquired pursuant to such exercise, except to the extent that the
participant recognizes ordinary income in a Disqualifying
Disposition.
If the holder of an ISO pays the exercise price, in
whole or in part, with previously acquired Common Shares, the
exchange should not effect the ISO tax treatment of the exercise.
Upon such exchange, and except for Disqualifying Dispositions, no
gain or loss is recognized by the participant upon the delivery
of the previously acquired Common Shares to the Company for the
payment of the exercise price. The Common Shares received by the
participant, equal in number to the previously acquired Common
Shares exchanged therefor, will have the same basis and holding
period for long-term capital gain purposes as the previously
acquired Common Shares. The participant, however, will not be
able to utilize the prior holding period for the purpose of
satisfying the ISO statutory holding period requirements. Common
Shares received by the participant in excess of the number of
previously acquired Common Shares will have a basis of zero and a
holding period which commences as of the date the Common Shares
are issued to the participant upon exercise of the ISO. If the
exercise of an ISO is effected using Common Shares previously
acquired through the exercise of an ISO, the exchange of the
previously acquired Common Shares will be considered a
disposition of such Common Shares for the purposes of determining
whether a Disqualifying Disposition has occurred.
NQSOs
A participant receiving an NQSO does not recognize
taxable income on the date of grant of the NQSO, provided that
the NQSO does not have a readily ascertainable fair market value
at the time it is granted. In general, the participant must
recognize ordinary income at the time of exercise of the NQSO in
the amount of the difference between the fair market value of the
Common Shares of the Company on the date of exercise and the
option price. The ordinary income received will constitute
compensation for which tax withholding generally will be
required. The amount of ordinary income recognized by a
participant will be deductible by the Company in the year that
the participant recognizes the income if the Company complies
with the applicable withholding requirement.
Common Shares acquired upon exercise of an NQSO will
have a tax basis equal to their fair market value on the exercise
date or other relevant date on which ordinary income is
recognized, and the holding period for the Common Shares
generally will begin on the date of exercise or such other
relevant date. Upon subsequent disposition of the Common Shares,
the participant will recognize long-term capital gain or loss if
the participant has held the Common Shares for more than one year
prior to disposition, or short-term capital gain or loss if the
participant has held the Common Shares for one year or less.
If the holder of an NQSO pays the exercise price, in
whole or in part, with previously acquired Common Shares, the
holder will recognize ordinary income in the amount by which the
fair market value of the Common Shares received exceeds the
exercise price. The participant will not recognize gain or loss
upon delivery of the previously acquired Common Shares to the
Company. The Common Shares received by the holder equal in
number to the previously acquired Common Shares exchanged
therefor will have the same basis and holding period for capital
gain purposes as the previously acquired Common Shares. Common
Shares received by the holder of the NQSO in excess of the number
of previously acquired Common Shares will have a basis equal to
the fair market value of such additional Common Shares as of the
date ordinary income is recognized. The holding period for such
additional Common Shares will commence as of the date of exercise
or such other relevant date.
Performance Share Awards
The grant of a Performance Share Award will not result
in income for the grantee or in a deduction for the Company.
Upon the receipt of Common Shares or cash under a Performance
Share Award, the grantee will recognize ordinary income and the
Company will be entitled to a deduction measured by the fair
market value of the Common Shares plus any cash received. Income
tax withholding will be required.
Other Matters
The 1994 Plan is intended to comply with Section 162(m)
of the Code which was enacted as part of the Omnibus Budget
Reconciliation Act of 1993. Section 162(m) of the Code prohibits
a publicly held corporation, such as the Company, from claiming a
deduction on its federal income tax return for compensation in
excess of $1 million paid for a given fiscal year to the chief
executive officer (or person acting in that capacity) at the
close of the corporation's fiscal year and the four most highly
compensated officers of the corporation, other than the chief
executive officer, at the end of the corporation's fiscal year
(collectively, the "Section 162(m) Officers"). The $1 million
compensation deduction limitation does not apply to "performance-
based compensation." The proposed regulations issued by the
Internal Revenue Service under Section 162(m) on December 15,
1993 (the "Proposed IRS Regulations") set forth a number of
provisions which compensatory plans must contain if the
compensation paid thereunder is to qualify as "performance-based"
for purposes of Section 162(m).
The 1994 Plan is intended to satisfy the requirements
of the Proposed IRS Regulations. The final regulations under
Section 162(m) are not expected to be issued until at least later
this year and the Company cannot predict what requirements the
final regulations under Section 162(m) will contain. The Company
is seeking stockholder approval of the 1994 Plan in a good faith
effort to qualify compensation received thereunder as
"performance-based" for purposes of Section 162(m). If such
stockholder approval is not obtained, the 1994 Plan will be null
and void.
Vote Required
Stockholder approval of the 1994 Plan will require the
affirmative vote of the holders of a majority of the Company's
Common Shares outstanding and entitled to vote on the proposal to
approve the 1994 Plan.
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY
RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE PROPOSAL TO APPROVE
THE 1994 PLAN. UNLESS OTHERWISE DIRECTED, THE PERSONS NAMED IN
THE ENCLOSED PROXY WILL VOTE THE COMMON SHARES REPRESENTED BY ALL
PROXIES RECEIVED PRIOR TO THE ANNUAL MEETING, AND NOT PROPERLY
REVOKED, IN FAVOR OF THE PROPOSAL TO APPROVE THE 1994 PLAN.
PROXY STATEMENT PROPOSALS
Each year the Board of Directors submits its nomina-
tions for election as directors at the annual meeting of stock-
holders. Other proposals may be submitted by the Board of
Directors or stockholders for inclusion in the Proxy Statement
for action at each year's annual meeting. Any proposal submitted
by a stockholder for inclusion in the Proxy Statement for the
1995 Annual Meeting, presently scheduled for August 7, 1995, must
be received by the Company on or before March 3, 1995.
INFORMATION CONCERNING INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Ernst & Young, which has served as independent
certified public accountants for the Company since 1980, has been
selected by Management to serve in that capacity for the 1995
fiscal year. Representatives of Ernst & Young are expected to be
present at the Annual Meeting, will be given the opportunity to
make a statement if they desire to do so and will be available to
respond to appropriate questions.
REPORTS TO BE PRESENTED AT THE ANNUAL MEETING
There will be presented at the Annual Meeting the
Company's Annual Report for the fiscal year ended April 29, 1994,
containing financial statements for such fiscal year and the
signed report of Ernst & Young, independent certified public
accountants, with respect to such financial statements. The
Annual Report is not to be regarded as proxy soliciting material,
and Management of the Company does not intend to ask, suggest or
solicit any action from the stockholders with respect to such
Report.
OTHER MATTERS
As of the date of this Proxy Statement, the only
business which Management intends to present at the Annual
Meeting consists of the matters set forth in this Proxy State-
ment. Management knows of no other matters to be brought before
the Annual Meeting by any other person or group.
If any other matters should properly come before the
Annual Meeting, or any adjournment or adjournments thereof, the
proxy holders will vote thereon in their discretion, in
accordance with their best judgment in light of the conditions
then prevailing.
All proxies received duly executed and not properly
revoked will be voted.
You are requested to sign and date the enclosed proxy
and mail it promptly in the enclosed envelope. If you later
desire to vote in person, you may revoke your proxy, either by
written notice delivered to the Company before the proxy is voted
or in person at the Annual Meeting before the proxy is voted
(without affecting any vote previously taken).
BY ORDER OF THE BOARD OF DIRECTORS
Daniel E. Evans
Chairman of the Board
(Chief Executive Officer)
BOB EVANS FARMS, INC. 1994 LONG TERM INCENTIVE PLAN
1. Purpose. The purpose of the Bob Evans Farms, Inc. 1994 Long
Term Incentive Plan (the "Plan") is to foster and promote the long-term
success of Bob Evans Farms, Inc. (the "Company") and materially increase
stockholder value by (a) motivating superior performance by means of
performance-related incentives, (b) encouraging and providing for the
acquisition of an ownership interest in the Company by officers and other key
employees of the Company and its Subsidiaries and (c) enabling the Company to
attract and retain the services of an outstanding management team upon whose
judgment, interest and special effort the successful conduct of the operations
of the Company is largely dependent.
2. Administration. The Plan will be administered by a
committee (the "Committee") of at least three persons who shall be either the
Stock Option Committee of the Board of Directors of the Company or such other
committee comprised entirely of "disinterested persons" within the meaning of
Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or any successor rule or regulation, as the Board of
Directors of the Company may from time to time designate. No member of the
Committee shall be (a) a current employee of the Company or of any of its
Subsidiaries or (b) a former employee of the Company or of any of its
Subsidiaries who is receiving compensation for prior services (other than
benefits under a tax-qualified retirement or savings plan) or (c) a current or
former officer of the Company or of any of its Subsidiaries or (d) receiving
remuneration in any capacity other than as a director except as permitted
under Section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Code"), and the regulations and rulings thereunder. The Committee shall
interpret the Plan; prescribe, amend and rescind rules and regulations
relating thereto; and make all other determinations necessary or advisable for
the administration of the Plan. Any determination, decision or action of the
Committee in connection with the construction, interpretation, administration
or application of the Plan shall be final, conclusive and binding upon all
persons participating in the Plan and any person validly claiming under or
through persons participating in the Plan. A majority of the members of the
Committee shall constitute a quorum at any meeting of the Committee, and all
determinations of the Committee at a meeting shall be made by a majority of
its members. Any determination of the Committee under the Plan may be made
without a meeting of the Committee by a writing signed by all of its members.
No member of the Board of Directors of the Company or of the Committee shall
be liable for any action or determination made in good faith, with respect to
the Plan or any Award granted under the Plan. The Company shall effect the
granting of Awards under the Plan in accordance with the determination of the
Committee, by execution of instruments in writing in such form as approved by
the Committee.
With respect to persons subject to Section 16 of the Exchange Act,
transactions under the Plan are intended to comply with all applicable
conditions of Rule 16b-3 under the Exchange Act, or any successor rule or
regulation. To the extent any provision of the Plan or action by the
Committee fails to so comply, it shall be deemed null and void, to the extent
permitted by law and deemed advisable by the Committee.
3. Participants. Participants in the Plan will consist of such
officers and other full-time employees of the Company or any of its
Subsidiaries, including those who are directors of the Company, as the
Committee in its sole discretion may designate from time to time to receive
Awards hereunder. The Committee's designation of a Participant in any year
shall not require the Committee to designate such person to receive an Award
in any other year. The Committee shall consider such factors as it deems
pertinent in selecting Participants and in determining the type and amount of
their respective Awards, including, without limitation: (a) the financial
condition of the Company and its Subsidiaries; (b) anticipated profits for the
current or future years; (c) contributions of Participants to the
profitability and development of the Company and its Subsidiaries; and
(d) other compensation provided to Participants. During the period in which
this Plan remains in effect, no Participant shall be granted Awards under this
Plan covering, in the aggregate, more than Two Hundred Fifty Thousand
(250,000) Common Shares.
4. Types of Awards. Awards under the Plan may be granted in
any one or a combination of (a) Incentive Stock Options; (b) Non-Qualified
Stock Options; and (c) Performance Share Awards, all as described below in
Sections 6, 7 and 8 hereof.
5. Common Shares Reserved Under the Plan. There is hereby
reserved for issuance under the Plan an aggregate of One Million (1,000,000)
Common Shares, which may be newly issued or treasury shares. If there is a
lapse, expiration, termination or cancellation of any Award granted hereunder
without the issuance of Common Shares or payment of cash thereunder, or if
Common Shares are issued under any Award and thereafter are reacquired by the
Company pursuant to rights reserved upon the issuance thereof, the Common
Shares subject to or reserved for such Award may again be used for new Stock
Options or other Awards under the Plan so long as the holder thereof has not
received any benefits of ownership of such Common Shares; provided, however,
that in no event may the number of Common Shares issued under the Plan exceed
the total number of Common Shares reserved for issuance hereunder.
6. Incentive Stock Options. Incentive Stock Options will
consist of Stock Options, qualifying as "incentive stock options" under the
requirements of Section 422 of the Code, to purchase Common Shares at purchase
prices of not less than One Hundred Percent (100%) of the Fair Market Value of
such Common Shares on the date of grant. Incentive Stock Options will be
exercisable over not more than ten (10) years after the date of grant. In the
event of the termination of an optionee's employment for any reason other than
Disability, Death or for Cause, the right of the optionee to exercise an
Incentive Stock Option shall terminate upon the earlier to occur of the end of
the original term of the Incentive Stock Option or three (3) months after the
date of such termination of employment. In the event that an optionee is
Terminated for Cause, the right of the optionee to exercise an Incentive Stock
Option shall terminate immediately upon the termination of employment. In the
event of the termination of an optionee's employment due to Disability, the
right of the optionee to exercise an Incentive Stock Option shall terminate
upon the earlier to occur of the end of the original term of the Incentive
Stock Option or one (1) year after the date of termination of employment. If
an optionee should die while employed, the right of the optionee's successor
in interest to exercise an Incentive Stock Option granted to the optionee
shall terminate upon the earlier to occur of the end of the original term of
the Incentive Stock Option or one year after optionee's last date of
employment. If an optionee should die within three (3) months after
termination of employment due to Retirement, the right of his or her successor
in interest to exercise an Incentive Stock Option shall terminate three (3)
months after the date of termination of employment as a result of such
Retirement, but not later than the end of the original term of the Incentive
Stock Option. If an optionee should die within one (1) year after termination
of employment due to Disability, the right of his or her successor in interest
to exercise an Incentive Stock Option shall terminate upon the earlier to
occur of one (1) year after the date of termination of employment or the end
of the original term of the Incentive Stock Option. For purposes of this
Section 6, if an optionee terminates his or her employment voluntarily, the
date of termination of employment shall be deemed to be the date on which he
or she notifies the Company of his or her intention to terminate his or her
employment; in all other cases, the date of termination of employment shall be
the last day of employment.
The aggregate fair market value (determined as of the time the
Stock Option is granted) of the Common Shares with respect to which incentive
stock options are exercisable for the first time by any Participant during any
calendar year (under all option plans of the Company and all Subsidiaries and
Parents of the Company) shall not exceed $100,000. An Incentive Stock Option
granted to a Participant under the Plan may be exercised only after six (6)
months from its grant date. Anything contained herein to the contrary
notwithstanding, no Incentive Stock Option shall be granted to an employee
who, at the time the Incentive Stock Option is granted, owns (actually or
constructively under the provisions of Section 424(d) of the Code) stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company or of any Parent or Subsidiary of the Company, unless the
option exercise price is not less than 110% of the Fair Market Value of the
Common Shares subject to the Incentive Stock Option on the date of grant and
the Incentive Stock Option by its terms is not exercisable more than five (5)
years from the date it is granted.
7. Non-Qualified Stock Options. Non-Qualified Stock Options
will consist of options to purchase Common Shares at purchase prices not less
than One Hundred Percent (100%) of the Fair Market Value of such Common Shares
on the date of grant. Non-Qualified Stock Options will be exercisable over
not more than ten (10) years after the date of grant. In the event of the
termination of an optionee's employment for any reason other than Retirement,
Disability, Death or for Cause, the right of the optionee to exercise a Non-
Qualified Stock Option shall terminate upon the earlier to occur of the end of
the original term of the Non-Qualified Stock Option or three (3) months after
the date of such termination of employment. If an optionee is Terminated for
Cause, the right of the optionee to exercise a Non-Qualified Stock Option
shall terminate immediately upon the termination of employment. In the event
of the termination of an optionee's employment due to Retirement or
Disability, or if the optionee should die while employed, the right of the
optionee or his or her successor in interest to exercise a Non-Qualified Stock
Option shall terminate upon the earlier to occur of the end of the original
term of the Non-Qualified Stock Option or one (1) year after the date of
termination of employment as a result of such Retirement, Disability or death.
If an optionee should die within one (1) year after termination of employment
due to Retirement or Disability, the right of his or her successor in interest
to exercise a Non-Qualified Stock Option shall terminate upon the earlier of
one (1) year after termination of employment as a result of such Retirement or
Disability or the end of the original term of the Non-Qualified Stock Option.
For purposes of this Section 7, if an optionee terminates his or her
employment voluntarily, the date of termination of employment shall be deemed
to be the date on which he or she notifies the Company of his or her intention
to terminate his or her employment; in all other cases, the date of
termination of employment shall be the last day of employment. A Non-
Qualified Stock Option granted to a Participant under the Plan may be
exercised only after six (6) months from its grant date.
8. Performance Share Awards. The Committee may grant awards
under which payment may be made in Common Shares, cash or any combination of
Common Shares and cash if the performance of the Company or any Subsidiary
selected by the Committee during the Performance Period meets certain goals
established by the Committee ("Performance Share Awards"). Such Performance
Share Awards shall be subject to the following terms and conditions and such
other terms and conditions as the Committee may prescribe:
(a) Performance Period and Performance Goals. The
Committee shall determine and include in a Performance Share Award grant the
period of time for which a Performance Share Award is made ("Performance
Period"). The Committee shall also establish performance objectives
("Performance Goals") to be met by the Company or Subsidiary during the
Performance Period as a condition to payment of the Performance Share Award.
The Performance Goals may include earnings per share, return on stockholders'
equity, return on assets, net income or any other financial or other measure
established by the Committee. The Performance Goals may include minimum and
optimum objectives or a single set of objectives.
(b) Payment of Performance Share Awards. The Committee
shall establish the method of calculating the amount of payment to be made
under a Performance Share Award if the Performance Goals are met, including
the fixing of a maximum payment. The Performance Share Award shall be
expressed in terms of Common Shares and referred to as "Performance Shares."
After the completion of a Performance Period, the performance of the Company
or Subsidiary shall be measured against the Performance Goals, and the
Committee shall determine whether all, none or any portion of a Performance
Share Award shall be paid. The Committee, in its discretion, may elect to
make payment in Common Shares, cash or a combination of Common Shares and
cash. Any cash payment shall be based on the Fair Market Value of the
underlying Common Shares on, or as soon as practicable prior to, the date of
payment.
(c) Revision of Performance Goals. At any time prior to
the end of a Performance Period, the Committee may revise the Performance
Goals and the computation of payment if unforeseen events occur which have a
substantial effect on the performance of the Company or Subsidiary and which
in the judgment of the Company make the application of the Performance Goals
unfair unless a revision is made.
(d) Requirement of Employment. A Participant who receives
a Performance Share Award must remain in the employment of the Company or
Subsidiary until the completion of the Performance Period in order to be
entitled to payment under the Performance Share Award; provided that the
Committee may, in its sole discretion, provide for a partial payment where
such an exception is deemed equitable.
9. Nontransferability. Each Stock Option and each Performance
Share Award granted under this Plan shall not be transferable other than by
will or the laws of descent and distribution, and Stock Options shall be
exercisable, during the Participant's lifetime, only by the Participant or the
Participant's guardian or legal representative.
10. Other Provisions. The grant of any Award under the Plan may
also be subject to such other provisions (whether or not applicable to any
Award granted to any other Participant) as the Committee determines
appropriate including, without limitation, provisions for the purchase of
Common Shares under Stock Options in installments, provisions for the payment
of the option exercise price of Common Shares under a Stock Option by delivery
of other Common Shares of the Company having a then Fair Market Value equal to
the option exercise price of such Common Shares, restrictions on resale or
other disposition, such provisions as may be appropriate to comply with
federal or state securities laws and stock exchange requirements and
understandings or conditions as to the Participant's employment in addition to
those specifically provided for under the Plan. If the Committee does not
specify another exercise schedule at the time of grant, the number of Common
Shares under each Stock Option which may be purchased in any one year ending
on an anniversary date of the grant of the Stock Option shall be the total
number of Common Shares subject to the Stock Option divided by the number of
years constituting the term of the Stock Option; provided, however, that if an
optionee does not purchase in any one option year the full number of Common
Shares to which he or she is then entitled, the optionee may purchase those
Common Shares in any subsequent year during the term of the Stock Option.
The Committee may, in its discretion, permit payment of the option
exercise price of Common Shares under Stock Options by delivery of a properly
executed exercise notice together with a copy of irrevocable instructions to a
broker to deliver promptly to the Company the amount of sale or loan proceeds
to pay the option exercise price. To facilitate the foregoing, the Company
may enter into agreements for coordinated procedures with one or more
brokerage firms.
The Committee may, in its discretion and subject to such rules as
it may adopt, permit a Participant to pay all or a portion of the federal,
state and local taxes, including FICA withholding tax, arising in connection
with the following transactions: (a) the exercise of a Non-Qualified Stock
Option; or (b) the receipt or exercise of any other Award; by electing (i) to
have the Company withhold Common Shares, (ii) to tender back Common Shares
received in connection with such Award or (iii) to deliver other previously
acquired Common Shares of the Company having a Fair Market Value approximately
equal to the amount to be withheld.
11. Term of the Plan and Amendment, Modification, Cancellation
or Acceleration of Awards. No Award shall be granted under the Plan more than
ten (10) years after the date of the adoption of the Plan by the Company's
Board of Directors. The terms and conditions applicable to any Award granted
prior to such date may at any time be amended, modified or cancelled, without
stockholder approval, by mutual agreement between the Committee and the
Participant or such other persons as may then have an interest therein, so
long as stockholder approval of such amendment, modification or cancellation
is not required under Rule 16b-3 under the Exchange Act or any applicable
requirements of any securities exchange on which are listed any of the
Company's equity securities or any applicable requirements for issuers whose
securities are traded in the NASDAQ National Market System or any applicable
requirements of the Code. The Committee may, at any time and in its sole
discretion, declare any or all Stock Options then outstanding under this Plan
to be exercisable, whether or not such Stock Options are then otherwise
exercisable.
12. Taxes. The Company shall be entitled to withhold the amount
of any tax attributable to any amount payable or Common Shares deliverable
under the Plan after giving the person entitled to receive such amount or
Common Shares notice as far in advance as practicable, and the Company may
defer making payment or delivery if any such tax may be pending unless and
until indemnified to its satisfaction.
13. Definitions.
(a) Award. The term "Award" means an award or grant of a
Stock Option or Performance Share made to a Participant under Section 6, 7 or
8 of the Plan.
(b) Change in Control. A "Change in Control" shall be
deemed to have occurred on the earliest of the following dates:
(i) The date any entity or person (including a
"group" as defined in Section 13(d)(3) of the Exchange Act)
shall have become the beneficial owner of, or shall have
obtained voting control over, twenty percent (20%) or more
of the outstanding Common Shares;
(ii) The date the stockholders of the Company approve
a definitive agreement (A) to merge or consolidate the
Company with or into another corporation, in which the
Company is not the continuing or surviving corporation or
pursuant to which any Common Shares would be converted into
cash, securities or other property of another corporation,
other than a merger of the Company in which holders of
Common Shares immediately prior to the merger have the same
proportionate ownership of shares of the surviving
corporation immediately after the merger as immediately
before, or (B) to sell or otherwise dispose of substantially
all the assets of the Company; or
(iii) The date there shall have been a change in a
majority of the Board of Directors of the Company within a
twelve (12) month period; provided, however, that any new
director whose nomination for election by the Company's
stockholders was approved, or who was appointed or elected
to the Board by, the vote of two-thirds of the directors
then still in office who were in office at the beginning of
the twelve (12) month period shall not be counted in
determining whether there has been such a change in a
majority of the Board.
(c) Code. "Code" means the Internal Revenue Code of 1986,
as amended, and the regulations and rulings thereunder. References to a
particular section of the Code shall include references to successor
provisions.
(d) Committee. The "Committee" means the Committee of the
Board of Directors of the Company constituted as provided in Section 2 hereof.
(e) Common Shares. "Common Shares" means the shares of
Common Stock, par value $0.01 per share, of the Company or any security of the
Company issued in substitution, exchange or lieu thereof.
(f) Company. The "Company" means Bob Evans Farms, Inc., a
Delaware corporation, or any successor corporation.
(g) Disability. The term "Disability" means, as it
relates to the exercise of an Incentive Stock Option after termination of
employment, a disability within the meaning of Section 22(e)(3) of the Code,
and for all other purposes, a mental or physical condition which, in the
opinion of the Committee, renders an optionee unable or incompetent to carry
out the job responsibilities which such optionee held or the tasks to which
such optionee was assigned at the time the disability was incurred, and which
is expected to be permanent or for an indefinite duration exceeding one year.
(h) Exchange Act. The term "Exchange Act" means the
Securities Exchange Act of 1934, as amended, or a successor statute.
(i) Fair Market Value. The "Fair Market Value" of the
Company's Common Shares shall mean, on any given date, the last reported sales
price of the Common Shares, as reported on the NASDAQ National Market System
or on any securities exchange on which the Company's Common Shares may be
listed on such date or, if there are no reported sales of Common Shares on
such date, then the last reported sales price on the next preceding day on
which such a sale was transacted.
(j) Incentive Stock Option. "Incentive Stock Option"
means any Stock Option granted pursuant to the provisions of Section 6 of the
Plan that is intended to be and is specifically designated as an "incentive
stock option" within the meaning of Section 422 of the Code.
(k) Non-Qualified Stock Option. A "Non-Qualified Stock
Option" means any Stock Option granted pursuant to the provisions of Section 7
of the Plan that is not an Incentive Stock Option.
(l) Parent. The term "Parent of the Company" shall have
the meaning set forth in 424(e) of the Code.
(m) Participant. The term "Participant" means a full-time
employee of the Company or a Subsidiary who is granted an Award under the
Plan.
(n) Performance Goals. The term "Performance Goals" shall
have the meaning set forth in Section 8 of the Plan.
(o) Performance Period. The term "Performance Period"
shall have the meaning set forth in Section 8 of the Plan.
(p) Performance Share Award. The term "Performance Share
Award" shall have the meaning set forth in Section 8 of the Plan.
(q) Plan. The "Plan" means the Bob Evans Farms, Inc. 1994
Long Term Incentive Plan, as set forth herein, and as it may be hereafter
amended and from time to time in effect.
(r) Retirement. The term "Retirement" for all purposes of
the Plan shall mean separation from employment with the Company and each of
its Subsidiaries on or after the date the person both has attained age fifty-
five (55) and is credited with at least ten (10) years of service.
(s) Stock Option. The term "Stock Option" means any
Incentive Stock Option or Non-Qualified Stock Option granted under the Plan.
(t) Stock Option Awards. The term "Stock Option Awards"
means any grant of a Stock Option to a Participant under the Plan.
(u) Subsidiary. The term "Subsidiary" for all purposes
other than the Incentive Stock Option plan described in Section 6, shall mean
any corporation, partnership, joint venture or business trust, fifty percent
(50%) or more of the control of which is owned, directly or indirectly, by the
Company. For purposes of the Incentive Stock Option plan described in Section
6, the term "Subsidiary" shall be defined as provided in Section 424(f) of the
Code.
(v) Terminated for Cause. The term "Terminated for Cause"
for purposes of the Plan shall mean termination on account of any act of fraud
or intentional misrepresentation or embezzlement, misappropriation or
conversion of assets or opportunities of the Company or a Subsidiary, the
conviction of a felony or intentional and repeated violations of the written
policies or procedures of the Company or any Subsidiary.
14. Adjustment Provisions.
(a) The existence of the Plan and the Awards granted
hereunder shall not affect or restrict in any way the right or power of the
Board of Directors or the stockholders of the Company to make or authorize any
adjustment, recapitalization, reorganization or other change in the Company's
capital structure or its business, any merger or consolidation of the Company,
any issue of bonds, debentures, preferred or prior preference stocks ahead of
or affecting the Company's capital stock or the rights thereof, the
dissolution or liquidation of the Company or any sale or transfer of all or
any part of its assets or business, or any other corporate act or proceeding.
(b) In the event of any change in capitalization affecting
the Common Shares, such as a stock dividend, stock split, recapitalization,
merger, consolidation, split-up, combination or exchange of shares or other
form of reorganization, or any other change affecting the Common Shares, the
Committee shall make proportionate adjustments to reflect such change with
respect to the aggregate number of Common Shares for which Awards in respect
thereof may be granted under the Plan, the maximum number of Common Shares
which may be sold or awarded to any Participant, the number of Common Shares
covered by each outstanding Award and the price per share in respect of
outstanding Awards.
(c) The Committee also shall make such adjustments in the
number of shares covered by, and the price or other value of, any outstanding
Awards in the event of a spin-off or other distribution (other than normal
cash dividends) of assets of the Company to stockholders.
(d) Subject to the six month holding requirements of
Sections 6 and 7 but notwithstanding any other provision of this Plan, upon
the occurrence of a Change in Control, all Stock Options then outstanding
under this Plan shall become fully exercisable as of the date of the Change in
Control, whether or not then otherwise exercisable.
15. Amendment and Termination of Plan. The Committee, with the
approval of the Board of Directors of the Company, may amend the Plan from
time to time or terminate the Plan at any time without the approval of the
stockholders of the Company except as such stockholder approval may be
required (a) to satisfy the requirements of Rule 16b-3 under the Exchange Act,
or any successor rule or regulation, (b) to satisfy applicable requirements of
the Code or (c) to satisfy applicable requirements of any securities exchange
on which are listed any of the Company's equity securities or any requirements
applicable to issuers whose securities are traded in the NASDAQ National
Market System. No such action to amend or terminate the Plan shall reduce the
then existing amount of any Participant's Award or adversely change the terms
and conditions thereof without the Participant's consent. No amendment of the
Plan shall result in any Committee member's losing his or her status as a
"disinterested person" as defined in Rule 16b-3 under the Exchange Act, or any
successor rule or regulation, with respect to any employee benefit plan of the
Company or result in the Plan losing its status as a plan satisfying the
requirements of said Rule 16b-3.
16. No Right to Employment. Neither the adoption of the Plan
nor the granting of any Awards hereunder shall confer upon any employee of the
Company or any Subsidiary any right to continued employment with the Company
or any Subsidiary, as the case may be, nor shall it interfere in any way with
the right of the Company or a Subsidiary to terminate the employment of any of
its employees at any time, with or without cause.
17. Unfunded Plan. The Plan shall be unfunded and the Company
shall not be required to segregate any assets that may at any time be
represented by Awards under the Plan. Any liability of the Company to any
person with respect to any Awards under the Plan shall be based solely upon
any contractual obligations that may be effected pursuant to the Plan. No
such obligation of the Company shall be deemed to be secured by any pledge of,
or other encumbrance on, any property of the Company or any Subsidiary.
18. Other Company Award and Compensation Plans. Payments and
other Awards received by a Participant under the Plan shall not be deemed a
part of a Participant's regular, recurring compensation for purposes of any
termination indemnity or severance pay law and shall not be included in, nor
have any effect on, the determination of awards under any other employee
benefit plan or similar arrangement provided by the Company or a Subsidiary
unless expressly so provided by such other plan or arrangement, or except
where the Committee expressly determines that an Award or portion of an Award
should be included to accurately reflect competitive compensation practices or
to recognize that an Award has been made in lieu of a portion of competitive
annual cash compensation. Awards under the Plan may be made in combination or
in tandem with, or as alternatives to, grants, awards or payments under any
other Company or Subsidiary plans. The Plan notwithstanding, the Company or
any Subsidiary may adopt such other compensation programs and additional
compensation arrangements as it deems necessary to attract, retain and reward
employees for their service with the Company and its Subsidiaries.
19. Securities Law Restrictions. No Common Shares shall be
issued under the Plan unless counsel for the Company shall be satisfied that
such issuance will be in compliance with applicable federal and state
securities laws. Certificates for Common Shares delivered under the Plan may
be subject to such stock transfer orders and other restrictions as the
Committee may deem advisable under the rules, regulations and other require-
ments of the Securities and Exchange Commission, any stock exchange upon which
the Common Shares are then listed or traded, the NASDAQ National Market System
or any applicable federal or state securities law. The Committee may cause a
legend or legends to be put on any such certificates to make appropriate
reference to such restrictions.
20. Award Agreement. Each Participant receiving an Award under
the Plan shall enter into an agreement with the Company in a form specified by
the Committee agreeing to the terms and conditions of the Award and such
related matters as the Committee shall, in its sole discretion, determine.
21. Cost of the Plan. The costs and expenses of administering
the Plan shall be borne by the Company.
22. Governing Law. The Plan and all actions taken thereunder
shall be governed by and construed in accordance with the laws of the State of
Delaware.
23. Stockholder Approval. The Plan was adopted by the Board of
Directors of the Company on April 15, 1994. The Plan and any Award granted
thereunder shall be null and void if stockholder approval is not obtained
within twelve (12) months of the adoption of the Plan by the Board of
Directors.
BOB EVANS FARMS, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON AUGUST 8, 1994
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned holder(s) of shares of Common Stock of Bob Evans
Farms, Inc. (the "Company") hereby appoints Daniel E. Evans and Donald J.
Radkoski, and each of them, the Proxies of the undersigned, with full power of
substitution, to attend the Annual Meeting of Stockholders of the Company to
be held at The Shelter House, Bob Evans Farms, at Rio Grande, Ohio, on Monday,
August 8, 1994, at 4:00 p.m., Eastern Daylight Time, and any adjournment or
adjournments thereof, and to vote all of the shares of Common Stock which the
undersigned is entitled to vote at such Annual Meeting or at any adjournment
or adjournments thereof:
1. To elect three Class II Directors to serve for terms of three
years each:
Larry C. Corbin; Stewart K. Owens; Robert E. H. Rabold
____ Vote for all nominees ____ Vote withheld for all nominees
____ Vote for all nominees except ________________________________
2. To approve the Bob Evans Farms, Inc. 1994 Long Term Incentive
Plan:
____ For ____ Against ____ Abstain
3. In their discretion, the Proxies are authorized to vote upon such
other matters (none known at the time of solicitation of this
proxy) as may properly come before the Annual Meeting or any
adjournment or adjournments thereof.
(THIS PROXY CONTINUES AND MUST BE SIGNED AND DATED ON THE REVERSE SIDE)
WHERE A CHOICE IS INDICATED, THE SHARES REPRESENTED BY THIS PROXY
WHEN PROPERLY EXECUTED WILL BE VOTED OR NOT VOTED AS SPECIFIED. IF NO CHOICE
IS INDICATED, THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED "FOR" THE
ELECTION OF THE NOMINEES LISTED IN ITEM NO. 1 AS DIRECTORS OF THE COMPANY AND
"FOR" PROPOSAL NO. 2. IF ANY OTHER MATTERS ARE PROPERLY BROUGHT BEFORE THE
ANNUAL MEETING OR ANY ADJOURNMENT OR ADJOURNMENTS THEREOF OR IF A NOMINEE FOR
ELECTION AS A DIRECTOR NAMED IN THE PROXY STATEMENT IS UNABLE TO SERVE OR FOR
GOOD CAUSE WILL NOT SERVE, THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED
IN THE DISCRETION OF THE PROXIES ON SUCH MATTERS OR FOR SUCH SUBSTITUTE
NOMINEES AS THE DIRECTORS MAY RECOMMEND.
The undersigned hereby acknowledges receipt of the Notice of the
Annual Meeting of Stockholders, dated July 1, 1994, the Proxy Statement
furnished therewith, and the Annual Report of the Company for the fiscal year
ended April 29, 1994. Any proxy heretofore given to vote the shares of Common
Stock which the undersigned is entitled to vote at the Annual Meeting of
Stockholders is hereby revoked.
Date______________________________________
__________________________________________
__________________________________________
Stockholder sign name exactly as it is
stenciled hereon.
NOTE: Please fill in, sign and return this
proxy in the enclosed envelope.
When signing as Attorney, Executor,
Administrator, Trustee or Guardian,
please give full title as such. If
signer is a corporation, please sign
the full corporate name by autho-
rized officer. Joint Owners should
sign individually. (Please note any
change of address on this proxy.)
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
BOB EVANS FARMS, INC.