SENECA FOODS CORPORATION
3736 South Main Street
Marion, New York 14505
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that the Annual Meeting (the "Meeting") of the
shareholders of SENECA FOODS CORPORATION will be held at Holiday Inn South, 1630
South Broadway Avenue, Rochester, Minnesota, on Friday, August 6, 2004, at 1:00
p.m., Central Daylight Savings Time, for the following purposes:
1. To elect one director to serve until the Annual Meeting of shareholders
in 2006 and three directors to serve until the Annual Meeting of
shareholders in 2007 and until each of their successors is duly elected
and shall qualify.
2. To ratify the appointment by the Board of Directors of Ernst & Young,
LLP as independent auditors for the fiscal year ending March 31, 2005.
3. To transact such other business as may properly come before the Meeting
or any adjournment thereof.
Accompanying this notice is a form of proxy and Proxy Statement. If you are
unable to be present in person at the Meeting, please sign the enclosed form of
proxy and return it in the enclosed envelope. If you attend the Meeting and vote
personally, the proxy will not be used. Only shareholders of record at the close
of business on June 11, 2004, will be entitled to vote at the Meeting and any
adjournment thereof. The prompt return of your proxy will save the expense of
further communications.
A copy of the Annual Report for the fiscal year ended March 31, 2004, also
accompanies this Notice.
By order of the Board of Directors,
JEFFREY L. VAN RIPER
Secretary
DATED: Marion, New York
June 29, 2004
IT IS IMPORTANT THAT THE ENCLOSED PROXY BALLOT BE SIGNED, DATED AND PROMPTLY
RETURNED IN THE ENCLOSED ENVELOPE, SO THAT YOUR SHARES WILL BE REPRESENTED
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING.
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS OF
SENECA FOODS CORPORATION
------------------------
Date of Mailing: June 29, 2004
Annual Meeting of Shareholders: August 6, 2004
The enclosed proxy is solicited by the Board of Directors of Seneca Foods
Corporation (hereinafter called the "Company"). Any proxy given pursuant to such
solicitation may be revoked by the shareholder at any time prior to the voting
of the proxy. The signing of the form of proxy will not preclude the shareholder
from attending the Annual Meeting (the "Meeting") and voting in person. Shares
represented by proxy will be voted in accordance with the directions of the
shareholder. The directors of the Company know of no matters to come before the
meeting other than those set forth in this Proxy Statement. In the event any
other matter may properly be brought before the meeting, the proxy holders will
vote the proxies in their discretion on such matter. If no choices are specified
on the proxy, the proxy will be voted FOR the proposals discussed in this Proxy
Statement.
All of the expenses involved in preparing and mailing this Proxy Statement
and the material enclosed herewith will be paid by the Company. The Company will
reimburse banks, brokerage firms and other custodians, nominees and fiduciaries
for expenses reasonably incurred by them in sending proxy material to beneficial
owners of stock.
Only record holders of the voting stock at the close of business on June
11, 2004 (the "Record Date") are entitled to vote at the Meeting. On that day
the following shares were issued and outstanding: (i) 3,911,480 shares of Class
A common stock, $0.25 par value per share ("Class A Common Stock"); (ii)
2,764,005 shares of Class B common stock, $0.25 par value per share ("Class B
Common Stock", and together with the Class A Common Stock, sometimes
collectively referred to as the "Common Stock"); (iii) 200,000 shares of Six
Percent (6%) Cumulative Voting Preferred Stock, $0.25 par value per share ("6%
Preferred Stock"); (iv) 407,240 shares of 10% Cumulative Convertible Voting
Preferred Stock - Series A, $0.25 stated value per share ("10% Series A
Preferred Stock"); (v) 400,000 shares of 10% Cumulative Convertible Voting
Preferred Stock - Series B, $0.25 stated value per share ("10% Series B
Preferred Stock"); (vi) 967,742 shares of Series 2003 Preferred Stock with $.025
par value per share; and (vii) 3,482,496 shares of Convertible Participating
Preferred Stock with $0.025 par value per share (the "Convertible Participating
Preferred Stock"). The shares of Class B Common Stock, 10% Series A Preferred
Stock, and 10% Series B Preferred Stock are entitled to one vote per share on
all matters submitted to the Company's shareholders. The shares of Class A
Common Stock are entitled to one-twentieth (1/20) of one vote per share on all
matters submitted to the Company's shareholders. The shares of 6% Preferred
Stock are entitled to one vote per share, but only with respect to the election
of directors. The shares of Convertible Participating Preferred Stock and Series
2003 Preferred Stock are not currently entitled to vote on matters submitted to
shareholders (other than as required by law); however, these shares are
convertible on a share-for-share basis into shares of Class A Common Stock,
which are entitled to one-twentieth (1/20) of one vote per share.
At the Meeting, shareholders of the Company will consider and vote upon the
following matters:
(1) To elect one director to serve until the Annual Meeting of shareholders in
2006 and three directors to serve until the Annual Meeting of shareholders
in 2007 and until each of their successors is duly elected and shall
qualify.
(2) To ratify the appointment by the Board of Directors of Ernst & Young as
independent auditors for the fiscal year ending March 31, 2005.
(3) To transact such other business as may properly come before the Meeting or
any adjournment thereof.
The Board of Directors of the Company unanimously recommends a vote FOR each of
the items set forth above.
PROPOSAL 1
ELECTION OF DIRECTORS
Under the By-Laws of the Company, its Board of Directors is divided into
three classes, as equal in number as possible, having staggered terms of three
years each. The Board of Directors has increased the total number of directors
from eight to nine. Therefore, at this annual meeting three directors will be
elected to serve until the annual meeting in 2007 and one director will be
elected to serve until the annual meeting in 2006, and until each of their
successors is duly elected and shall qualify.
Unless authority to vote for the election of directors is withheld or the
Proxy is marked to the contrary as provided therein, the enclosed Proxy will be
voted FOR the election of the two nominees listed below.
Although the directors do not contemplate that any of the nominees will be
unable to serve, should such a situation arise, the Proxy may be voted for the
election of other persons as directors. Each nominee, to be elected as a
director, must receive the affirmative vote of a plurality of the votes cast at
the Meeting by the shareholders entitled to vote thereon.
The following table sets forth certain information with respect to the
nominees for election as directors and directors whose terms continue beyond the
meeting:
Served as
Director
Nominee Principal Occupation for Past Five Years (1) Age Since
------- ---------------------------------------- --- ---------
Nominees Standing for Election
------------------------------
To serve until the annual meeting of shareholders in 2007 and until their
successors are duly elected and shall qualify:
Andrew M. Boas (3) General Partner of Carl Marks Management 49 1998
Company, L.P. (merchant banking firm); President of Carl Marks
Offshore Management, Inc. since 1994; Vice President of
CM Capital; Vice President of Carl Marks
& Co., Inc.
Douglas F. Brush Chairman and Business Development Officer of 50 2001
Sentry Group (manufacturer of safes),
Rochester, New York.
Susan W. Stuart (2) Marketing Consultant, Fairfield, Connecticut. 49 1986
To serve until the annual meeting of shareholders in 2006 and until his
successor is duly elected and shall qualify:
Thomas Paulson (5) Chief Financial Officer, Innovex, Inc. since 48 -
February, 2001, Vice President Finance, The Pillsbury
Company from 1998-2000.
Directors Whose Terms Expire in 2005
------------------------------------
Robert T. Brady Chairman and Chief Executive Officer of Moog, Inc. 63 1989
(manufacturer of control systems), East Aurora, New York. (6)
G. Brymer Humphreys President, Humphreys Farm Inc., 63 1983
New Hartford, New York.
Arthur S. Wolcott (2) Chairman of the Company. 78 1949
Directors Whose Terms Expire in 2006
------------------------------------
Arthur H. Baer (3) President of Hudson Valley Publishing since January 57 1998
2003 and 1998 to 1999; President Arrow Electronics Europe
from 2000 to 2002; President of XYAN Inc. from 1996 to 1998.
Kraig H. Kayser President and Chief Executive Officer of the Company. (4) 43 1985
(1) Unless otherwise indicated, each nominee has had the same principal
occupation for at least the past five years.
(2) Susan W. Stuart and Arthur S. Wolcott are daughter and father.
(3) Messrs. Boas and Baer were nominated to the Company's Board of Directors
pursuant to the terms of a Stock Purchase Agreement dated as of June 22,
1998, by and between the Company and Carl Marks Strategic Investments, L.P.
and related entities (collectively the "Investors"). Certain substantial
shareholders of the Company have agreed to vote their shares in favor of
Messrs. Boas and Baer. This voting arrangement will continue in effect
until the Investors, in the aggregate, own less than 10% of the outstanding
Class A Common Stock (assuming conversion of the Convertible Participating
Preferred Stock).
(4) Mr. Kayser is also a director of the following publicly held company: Moog
Inc. (5) Mr. Paulson was recommended by the chief executive officer and
certain non-management
directors and was approved by the Corporate Governance and Nominating
Committee for inclusion in this proxy statement.
(6) Mr. Brady is also a director of the following publicly held companies: Moog
Inc., National Fuel Gas Company, Astronics Corporation and M&T Bank
Corporation.
OWNERSHIP OF SECURITIES
Ownership by Management. The following table sets forth certain information
with respect to beneficial ownership of the Company's outstanding Class A Common
Stock, Class B Common Stock, 6% Preferred Stock, 10% Series A Preferred Stock,
10% Series B Preferred Stock, and Convertible Participating Preferred Stock by
each nominee and director and by all directors, nominees and officers as a group
as of April 1, 2004. ("Beneficial ownership" for these purposes is determined in
accordance with applicable Securities and Exchange Commission ["SEC"] rules and
includes shares over which a person has sole or shared voting power or
investment power):
Shares (1)
Beneficially Percent
Name Title of Class Owned of Class
---- -------------- ------------ --------
Arthur H. Baer Class B Common Stock 3,000 -(3)
Kraig H. Kayser Class A Common Stock (10) 218,158 5.52
Class B Common Stock (11) 456,912 16.53
6% Preferred Stock (12) 8,000 4.00
10% Series A Preferred Stock (13) 173,812 42.68
10% Series B Preferred Stock (14) 165,080 41.27
Andrew M. Boas Class A Common Stock 70,642 1.79
Class B Common Stock 70,642 2.56
Convertible Participating
Preferred Stock (9) 2,995,736 86.02
Douglas F. Brush Class B Common Stock 770 -(3)
Susan W. Stuart Class A Common Stock (15) 162,502 4.11
Class B Common Stock (16) 411,158 14.88
6% Preferred Stock 25,296 12.65
Robert T. Brady -(2) -(3)
Thomas Paulson - -(3)
G. Brymer Humphreys Class A Common Stock 800 -(3)
Class B Common Stock 800 -(3)
Convertible Participating
Preferred Stock 400 -(3)
Arthur S. Wolcott Class A Common Stock (4) 158,090 4.00
Class B Common Stock (5) 305,059 11.04
6% Preferred Stock (6) 32,844 16.42
10% Series A Preferred Stock (7) 212,840 52.26
10% Series B Preferred Stock (8) 212,200 53.05
Philip G. Paras Class A Common Stock 1,000 -(3)
Class B Common Stock 1,500 -(3)
All directors, nominees Class A Common Stock (18) 456,320 11.55
and named officers as a group (17) Class B Common Stock (19) 607,507 21.98
6% Preferred Stock (20) 66,140 33.07
10% Series A Preferred Stock (21) 386,652 94.94
10% Series B Preferred Stock (22) 377,280 94.32
Convertible Participating
Preferred Stock (23) 2,996,136 87.01
(1) Unless otherwise stated, each person named in the table has sole voting and
investment power with respect to the shares indicated as beneficially owned
by that person. No stock options are held by any of the named individuals
or the group. The holdings of Class A Common Stock and Class B Common Stock
listed in the table do not include the shares obtainable upon conversion of
the 10% Series A Preferred Stock and the 10% Series B Preferred Stock,
which are currently convertible into Class A Common Stock and Class B
Common Stock on the basis of 20 and 30 preferred shares, respectively, for
each share of Common Stock. The holdings of Class A Common Stock do not
include the shares obtainable upon conversion of the Convertible
Participating Preferred Stock, which is currently convertible into shares
of Class A Common Stock on a one-for-one basis.
(2) Does not include 300 shares of Class A Common Stock and 300 shares of Class
B Common Stock owned by Mr. Brady's children as to which Mr. Brady
disclaims beneficial ownership.
(3) Less than 1.0%.
(4) The shares in the table include (i) 29,531 shares of Class A Common Stock
held by Mr. Wolcott's wife, (ii) 76,936 shares held by the Seneca Foods
Foundation (the "Foundation"), of which Mr. Wolcott is a Director. The
shares reported in the table do not include (i) 313,528 shares of Class A
Common Stock held directly by Mr. and Mrs. Wolcott's offspring and their
families (including Susan W. Stuart), or (ii) 295,072 shares held by Seneca
Foods Corporation Employee Savings Plan (the "401(k) Plan"), over which the
Company's officers may be deemed to have shared voting and investment
power. Mr. Wolcott has shared voting and investment power with respect to
the shares held by the Foundation. He disclaims beneficial ownership with
respect to the shares held by his wife, his offspring and their families
and the 401(k) Plan.
(5) The shares in the table include (i) 8,584 shares of Class B Common Stock
held by Mr. Wolcott's wife, (ii) 213,000 shares held by the Pension Plan,
of which Mr. Wolcott is a trustee and (iii) 74,924 shares held by the
Foundation, of which Mr. Wolcott is a director. The shares in the table do
not include (i) 448,608 shares of Class B Common Stock held directly by Mr.
and Mrs. Wolcott's offspring and their families (including Susan W. Stuart)
or (ii) 22,128 shares held by the 401(k) Plan. Mr. Wolcott has shared
voting and investment power with respect to the shares held by the Pension
Plan and the Foundation. He disclaims beneficial ownership with respect to
the shares held by his wife, his offspring and their families and the
401(k) Plan.
(6) Does not include 101,176 shares of 6% Preferred Stock held directly by Mr.
and Mrs. Wolcott's offspring (including Susan W. Stuart), as to which Mr.
Wolcott disclaims beneficial ownership.
(7) These shares are convertible into 10,642 shares of Class A Common Stock and
10,642 shares of Class B Common Stock.
(8) These shares are convertible into 7,073 shares of Class A Common Stock and
7,073 shares of Class B Common Stock.
(9) These shares are convertible on a share-for-share basis into 2,995,736
shares of Class A Common Stock. Includes 2,995,736 shares of Convertible
Participating Preferred Stock owned by Investors, as to which Mr. Boas
disclaims beneficial ownership. Does not include 251,520 shares of
Convertible Participating Preferred Stock owned by Edwin Marks which are
related to the Investors via common ownership in certain entities and
family relationships and which sometimes are collectively referred to as
the "Related Marks Shareholders". Mr. Boas disclaims beneficial ownership
of the stock owned by the Related Marks Shareholders.
(10) Mr. Kayser has sole voting and investment power over 60,528 shares of Class
A Common Stock owned by him and sole voting but no investment power over
5,550 shares owned by his siblings and their children, which are subject to
a voting trust agreement of which Mr. Kayser is a trustee. Mr. Kayser has
shared voting and investment power with respect to 74,669 shares held in
two trusts of which he is a co-trustee and in which he and members of his
family are beneficiaries. Robert Oppenheimer of Rochester, New York is the
other co-trustee of the trusts. The shares reported in the table include
76,936 shares held by the Foundation, of which Mr. Kayser is a Director.
The shares reported in the table do not include (i) 14,902 shares owned by
Mr. Kayser's mother, (ii) 19,000 shares held in trust for Mr. Kayser's
mother, (iii) 4,900 shares held by Mr. Kayser's brothers, or (iv) 295,072
shares held by the 401(k) Plan, over which the Company's officers may be
deemed to have shared voting and investment power. Mr. Kayser has shared
voting and investment power with respect to the shares held by the
Foundation. He disclaims beneficial ownership of the shares held by his
mother and in trust for his mother, the shares held by his brother and the
shares held by the 401(k) Plan.
(11) Mr. Kayser has sole voting and investment power over 82,994 shares of Class
B Common Stock he owns and sole voting but no investment power over 10,050
shares owned by his siblings and their children, which are subject to a
voting trust agreement of which Mr. Kayser is a trustee. Mr. Kayser has
shared voting and investment power with respect to 75,944 shares held in
two trusts of which he is a co-trustee and in which he and members of his
family are beneficiaries. Robert Oppenheimer of Rochester, New York is the
other co-trustee of the trusts. The shares in the table include (i) 213,000
shares held by the Pension Plan, of which Mr. Kayser is a trustee and (ii)
74,924 shares held by the Foundation, of which Mr. Kayser is a director.
The shares in the table do not include (i) 14,912 shares owned by Mr.
Kayser's mother, or (ii) 19,000 shares held in trust for Mr. Kayser's
mother, and (iii) 22,128 shares held by the 401(k) Plan. Mr. Kayser has
shared voting and investment power with respect to the shares held by the
Pension Plan and the Foundation. He disclaims beneficial ownership of the
shares held by his mother and in trust for his mother and the shares held
by the 401(k) Plan.
(12) Does not include 27,536 shares of 6% Preferred Stock held by Mr. Kayser's
brother, as to which Mr. Kayser disclaims beneficial ownership. See also
the table in "Principal Owners of Voting Stock".
(13) Mr. Kayser has shared voting and investment power with respect to 141,644
shares of 10% Series A Preferred Stock held in two trusts described in
notes 10 and 11 above. The total 173,812 shares of 10% Series A Preferred
Stock are convertible into 8,690 shares of Class A Common Stock and 8,690
shares of Class B Common Stock.
(14) Mr. Kayser has shared voting and investment power with respect to 165,080
shares of 10% Series B Preferred Stock held in two trusts described in
notes 10 and 11 above. The total 165,080 shares of 10% Series B Preferred
Stock are convertible into 5,502 shares of Class A Common Stock and 5,502
shares of Class B Common Stock.
(15) The shares in the table include (i) 12,616 shares of Class A Common Stock
held by Ms. Stuart's husband, (ii) 15,736 shares owned by her sister's
children, of which Ms. Stuart is the trustee, (iii) 76,936 shares held by
the Foundation, of which Ms. Stuart is a trustee. Ms. Stuart has shared
voting and investment power with respect to the shares held by the
Foundation and sole voting and investment power with respect to the shares
owned by her sister's children. She disclaims beneficial ownership of the
shares held by her husband.
(16) The shares reported in the table include (i) 18,894 shares of Class B
Common Stock held by Ms. Stuart's husband, (ii) 40,848 shares owned by her
sister's children, of which Ms. Stuart is the trustee, (iii) 213,000 shares
held by the Pension Plan, of which Ms. Stuart is a trustee and (iv) 74,924
shares held by the Foundation, of which Ms. Stuart is a director. Ms.
Stuart has shared voting and investment power with respect to the shares
held the Pension Plan and the Foundation and sole voting and investment
power with respect to the shares owned by her sister's children. She
disclaims beneficial ownership of the shares held by her husband.
(17) Does not include 496,446 shares of Class A Common Stock or 460,446 shares
of Class B Common Stock owned by the Related Marks Shareholders, as to
which Andrew Boas disclaims beneficial ownership. See note 9 above.
(18) See notes 2, 4, 7, 8, 9, 10, 15 and 17 above.
(19) See notes 2, 5, 7, 8, 11, 13 and 16 above.
(20) See notes 6 and 12 above.
(21) See notes 7 and 13 above.
(22) See notes 8 and 14 above.
(23) See note 9 above.
Principal Owners of Voting Stock. The following table sets forth, as of
April 1, 2004, certain information with respect to persons known by the Company
to be the beneficial owners of more than five percent of the classes of stock.
("Beneficial ownership" for these purposes is determined in accordance with
applicable SEC rules and includes shares over which a person has sole or shared
voting power or investment power.) The holdings of Common Stock listed in the
table do not include the shares obtainable upon conversion of the 10% Series A
Preferred Stock and the 10% Series B Preferred Stock, which currently are
convertible into Class A Common Stock and Class B Common Stock on the basis of
20 and 30 shares of Preferred Stock, respectively, for each share of Common
Stock. The holdings of Class A Common Stock listed in the table do not include
the shares obtainable upon conversion of the Series 2003 Preferred Stock or the
Convertible Participating Preferred Stock, which is convertible into Class A
Common Stock on a one-for-one basis.
Amount of Shares and Nature
of Beneficial Ownership
------------------------------------------------------
Sole Voting/ Shared Voting/
Name and Address of Investment Investment Percent
Title of Class Beneficial Owner Power Power Total of Class
-------------- --------------------- ------------ -------------- ----- --------
6% Preferred Stock Arthur S. Wolcott (1) 32,844 -- 32,844 16.42%
Kurt C. Kayser 27,536 (2) -- 27,536 13.77
Bradenton, Florida
Susan W. Stuart 25,296 (3) -- 25,296 12.65
Fairfield, Connecticut
Bruce S. Wolcott 25,296 (3) -- 25,296 12.65
Canandaigua, New York
Grace W. Wadell 25,292 (3) -- 25,292 12.65
Wayne, Pennsylvania
Mark S. Wolcott 25,292 (3) -- 25,292 12.65
Pittsford, New York
L. Jerome Wolcott, Jr. 15,222 -- 15,222 7.61
Costa Mesa, California
Peter J. Wolcott 15,222 (3) -- 15,222 7.61
Bridgewater, Connecticut
10% Series A Arthur S. Wolcott 212,840 (4) -- 212,840 52.26
Preferred Stock
Kraig H. Kayser (5) 32,168 141,644 (6) 173,812 42.68
Hannelore Wolcott-Bailey 20,588 -- 20,588 5.06
Penn Yan, New York
10% Series B Arthur S. Wolcott 212,200 (7) -- 212,200 53.05
Preferred Stock
Kraig H. Kayser -- 165,080 (8) 165,080 41.27
Hannelore Wolcott-Bailey 22,720 -- 22,720 5.68
Class A Common
Stock(9) Nancy A. Marks (10) 217,892 232,912 (11) 450,804 11.41%
Great Neck, New York
The Pillsbury Company (12) -- 346,570 346,570 8.77
General Mills, Inc.
Minneapolis, Minnesota
T. Rowe Price 306,600 -- 306,600 7.76
Associates, Inc. (17)
Baltimore, Maryland
Franklin Advisory 256,600 -- 256,600 6.50
Services, LLC (16)
San Mateo, California
Susan W. Stuart (15) 57,214 105,288 162,508 4.11
Kraig H. Kayser (13) 60,528 157,630 218,158 5.52
Arthur S. Wolcott (14) 51,623 106,467 156,090 4.00
Class B Common Stock Susan W. Stuart 63,492 347,666 (20) 411,158 14.88
Kraig H. Kayser 82,994 373,918 (8) 456,912 16.53
Nancy A. Marks (10) 318,412 96,392 414,804 15.01
Arthur S. Wolcott 8,551 296,508 (19) 305,059 11.04
T. Rowe Price 146,900 -- 146,900 5.31
Associates, Inc(17)
Baltimore, Maryland
Convertible Carl Marks Strategic 2,304,161 -- 2,304,161 66.11
Participating Investments, LP
Preferred New York, New York
Stock (21)
Carl Marks Strategic 691,575 -- 691,575 19.84
Investments II, LP
New York, New York
Nancy A. Marks 145,000 106,520 251,520 7.22
Series 2003 Chiquita Brands 967,742 -- 967,742 100.00
Preferred International, Inc.
Stock Cincinnati, Ohio
(1) Business address: Suite 1010, 1605 Main Street, Sarasota, Florida 34236.
(2) These shares are included in the shares described in note 13 to the table
under the heading "Ownership by Management".
(3) These shares are included in the shares described in note 6 to the table
under the heading "Ownership by Management".
(4) See note 7 to the table under the heading "Ownership by Management".
(5) Business address: 3736 South Main Street, Marion, New York 14505.
(6) See note 14 to the table under the heading "Ownership by Management".
(7) See note 8 to the table under the heading "Ownership by Management".
(8) See note 15 to the table under the heading "Ownership by Management".
(9) Does not include 2,995,736 shares of Convertible Participating Preferred
Stock held by the New Investors, which are convertible on a share-for-share
basis into 2,995,736 shares of Class A Common Stock. Does not include
251,520 shares of Convertible Participating Preferred Stock held by the
Related Marks Shareholders, which are convertible into 251,520 shares of
Class A Common Stock. See notes 12, 13, and 21 below. See also notes 9 and
18 to the table under the heading "Ownership by Management."
(10) Based on a statement on Schedule 13D filed by Edwin S. Marks with the SEC
(as most recently amended in July 1998) and Form 4 filed with the SEC by
Edwin S. Marks for March 2000.
(11) Nancy A. Marks shares voting and dispositive power with respect to 232,912
of these shares with her daughters. She disclaims beneficial ownership of
these shares.
(12) Based on a statement on Schedule 13D filed by The Pillsbury Company (now a
subsidiary of General Mills, Inc.) and Grand Metropolitan with the SEC in
March 1996.
(13) See note 11 to the table under the heading "Ownership by Management".
(14) See note 4 to the table under the heading "Ownership by Management".
(15) See note 16 to the table under the heading "Ownership by Management".
(16) Based on a statement on Schedule 13G filed with the SEC February 2003, by
Franklin Advisory Services, Inc.
(17) These securities are owned by various individual and institutional
investors, which T. Rowe Price Associates, Inc. (Price Associates) serves
as investment adviser with power to direct investments and/or sole power to
vote the securities. For purposes of the reporting requirements of the
Securities Exchange Act of 1934, Price Associates is deemed to be a
beneficial owner of such securities; however, Price Associates expressly
disclaims that it is, in fact, the beneficial owner of such securities.
(18) See note 12 to the table under the heading "--Ownership by Management."
(19) See note 5 to the table under the heading "--Ownership by Management."
(20) See note 17 to the table under the heading "--Ownership by Management."
(21) The shares of Convertible Participating Preferred Stock are not currently
entitled to vote on matters submitted to shareholders (other than as
required by law); however, these shares are convertible on a one-for-one
basis into shares of Class A Common Stock, which are entitled to
one-twentieth (1/20) of one vote per share.
Independence
The Board has determined that each current director and nominee for
director, other than Mr. Wolcott, the Company's Chairman, his daughter, Ms.
Stuart, and Mr. Kayser, the Company's President and Chief Executive Officer, is
"independent" as defined by the listing standards of The NASDAQ Stock Market.
The Board has determined that Mr. Brady is independent under the current NASDAQ
listing standards, however, he will not be considered independent under the new
listing standards that become effective as of the date of the Company's 2004
Annual Meeting due to the three year look back period for compensation committee
interlocks. No director has any material relationship with the Company other
than those described in "Certain Transactions and Related Relationships" below.
Information Concerning Operation Of The Board of Directors
In order to facilitate the handling of various functions of the Board of
Directors, the Board has appointed several committees including an Audit
Committee, a Compensation Committee and a Corporate Governance and Nominating
Committee.
The members of the Audit Committee are Arthur H. Baer (Chairman), Robert T.
Brady, Douglas F. Brush and G. Brymer Humphreys. Mr. Baer has been designated as
the Company's "audit committee financial expert" in accordance with the SEC
rules and regulations. Shareholders should understand that this designation is a
disclosure requirement of the SEC related to Mr. Baer's experience and
understanding with respect to certain accounting and auditing matters. The
designation does not impose any duties, obligations or liability that are
greater than are generally imposed on him as a member of the Audit Committee and
the Board, and his designation as an audit committee financial expert pursuant
to this SEC requirement does not affect the duties, obligations or liability of
any other member of the Audit Committee or the Board. The Audit Committee
recommends to the full Board of Directors the engagement of independent
auditors, reviews with the auditors the scope and results of the audit, reviews
with management the scope and results of the Company's internal auditing
procedures, reviews the independence of the auditors and any non-audit services
provided by the auditors, reviews with the auditors and management the adequacy
of the Company's system of internal accounting controls and makes inquiries into
other matters within the scope of its duties.
The Corporate Governance and Nominating Committee consists of Arthur S.
Wolcott (Chairman), Robert T. Brady, G. Brymer Humphreys and Andrew M. Boas.
Each Committee member, other than Mr. Wolcott is independent under the current
NASDAQ listing standards. The text of the charter of the Corporate Governance
and Nominating Committee is available on the Company's website
(www.senecafoods.com). The Committee screens and selects nominees for vacancies
in the Board of Directors as they occur. Consideration will be given to serious
candidates for director who are recommended by shareholders of the Company.
Shareholder recommendations must be in writing and addressed to the Chairman of
the Corporate Governance and Nominating Committee, c/o Corporate Secretary, 3736
South Main Street, Marion, New York 14505, and should include a statement
setting forth the qualifications and experience of the proposed candidates and
basis for nomination. Any person recommended by shareholders of the Company will
be evaluated in the same manner as any other potential nominee for director.
The Board has not adopted specific minimum criteria for director nominees.
The Corporate Governance and Nominating Committee identifies nominees by first
evaluating the current members of the Board of Directors willing to continue in
service. Current members of the Board with skills and experience that are
relevant to the Company's business and who are willing to continue in services
are considered for re-nomination. If any member of the Board does not wish to
continue in service, or if the Corporate Governance and Nominating Committee
decides not to nominate a member for re-election, the Committee first considers
the appropriateness of the size of the board. If the Committee determines the
board seat should remain and a vacancy exists, the independent directors
consider factors that it deems are in the best interests of the Company and its
shareholders in identifying and evaluating a new nominee. The Corporate
Governance and Nominating Committee will consider nominees suggested by
incumbent Board members, management and shareholders.
The Compensation Committee consists of Douglas F. Brush (Chairman), Susan
W. Stuart and Andrew M. Boas. The Compensation Committee establishes the level
of compensation on an annual basis for all executive officers.
As of the date of the 2004 Annual Meeting, the Company will be subject to
new NASDAQ listing standards that will impact the corporate governance structure
of the Board as well as the Audit, Compensation and Corporate Governance and
Nominating Committees. Assuming that the current nominees for Director are
elected at the 2004 Annual Meeting, it is contemplated that membership on the
various committees will be revised so that the Audit Committee will consist of
Arthur H. Baer, Robert T. Brady, Douglas F. Brush, G. Brymer Humphreys and
Thomas Paulson; the Corporate Governance and Nominating Committee will consist
of Andrew M. Boas, Robert T. Brady, G. Brymer Humphreys and Thomas Paulson; and
the Compensation Committee will consist of Douglas F. Brush, Andrew M. Boas and
G. Brymer Humphreys.
During the fiscal year ended March 31, 2004, the Board of Directors had
five meetings, the Audit Committee had five meetings, the Corporate Governance
and Nominating Committee had one meeting and the Compensation Committee had one
meeting. All directors who served during the entire fiscal year attended at
least 75% of the aggregate of the total number of meetings of the Board of
Directors and the total number of meetings held by any committee of the Board on
which he or she served. In addition, each director is expected to attend the
Annual Meeting of shareholders. In 2003, the Annual Meeting of shareholders was
attended by all nine of the directors.
Shareholder Communication With the Board
The Company provides an informal process for shareholders to send
communications to the Board of Directors. Shareholders who wish to contact the
Board of Directors or any of its members may do so in writing to Seneca Foods
Corporation, 3736 South Main Street, Marion, New York 14505. Correspondence
directed to an individual board member will be referred, unopened, to that
member. Correspondence not directed to a particular board member will be
referred, unopened, to the Chairman of the Audit Committee.
Certain Relationships and Related Transactions
The Company operates under a contract pursuant to which Birds Eye Foods
supplies the Company's New York processing plants with their raw vegetable
requirements. Birds Eye's sources of supply are the grower-members of Pro-Fac
Cooperative, Inc., a non-controlling shareholder of Birds Eye. A small
percentage (1% in fiscal year 2004) of vegetables supplied to Seneca Foods under
this contract are grown by Humphreys Farms Inc. as a Pro-Fac grower-member. G.
Brymer Humphreys is President and a 23% shareholder of Humphreys Farms.
Each year the prices paid for all Pro-Fac-sourced vegetables are negotiated
between the Company and Birds Eye and paid directly to Birds Eye. The Company
understands that the member-growers who supplied the vegetables are paid through
Pro-Fac. The Company has no negotiations with Humphreys Farms and no authority
to require Birds Eye or Pro-Fac to fill from Humphreys Farms any particular
volume or percentage of the vegetables supplied to the Company. Moreover, the
Company does not negotiate or identify any special prices for vegetables
produced at Humphreys Farms as distinguished from other Pro-Fac grower-members.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires that the
Company's directors, officers and shareholders owning more than 10% of a
registered class of equity securities of the Company file reports regarding
their ownership and changes in that ownership with the SEC. The Company is not
aware that any from this group failed to make such filings in a timely manner
during the past year.
EXECUTIVE OFFICERS
The following is a listing of the Company's executive officers:
Served as
Officer
Officer Principal Occupation for Past Five Years (1) Age Since
------- ---------------------------------------- --- ---------
Arthur S. Wolcott See table under "Election of Directors". 78 1949
Kraig H. Kayser See table under "Election of Directors". 43 1991
Philip G. Paras Chief Financial Officer since March 31, 2000; 43 1996
Vice President-Finance from 1996 to 2000 and Treasurer of
the Company since 1997.
Jeffrey L. Van Riper Secretary and Controller of the Company. 47 1986
Sarah S. Mortensen Assistant Secretary of the Company. 59 1986
(1) Unless otherwise indicated, each officer has had the same principal
occupation for at least the past five years.
EXECUTIVE COMPENSATION
The following table sets forth the compensation paid by the Company to the
Chief Executive Officer and to the most highly compensated executive officers
whose compensation exceeded $100,000 (the "Named Officers") for services
rendered in all capacities to the Company and its subsidiaries during the fiscal
years ended March 31, 2004, 2003 and 2002.
Name of Individual and Fiscal Annual Compensation
Principal Position Year Salary Bonus
---------------------- ------ ------ -----
Arthur S. Wolcott 2004 $ 402,989 $ 50,595
Chairman and Director 2003 391,406 39,220
2002 381,708 --
Kraig H. Kayser 2004 $ 340,170 $ 51,150
President, Chief Executive 2003 330,392 33,107
Officer and Director 2002 322,206 --
Philip G. Paras 2004 $ 104,738 $ 15,761
Chief Financial Officer 2003 100,829 10,103
2002 --(1) --
(1) Compensation did not exceed $100,000 in 2002.
Pension Benefits
The executive officers of the Company are entitled to participate in the
Pension Plan (referred to in this section as the "Plan"), which is for the
benefit of all employees meeting certain eligibility requirements. Effective
August 1, 1989, the Company amended the Plan to provide improved pension
benefits under the Plan's Excess Formula. The Excess Formula for the calculation
of the annual retirement benefit is: total years of credited service (not to
exceed 35) multiplied by the sum of (i) 0.6% of the participant's average salary
(five highest consecutive years, excluding bonus), and (ii) 0.6% of the
participant's average salary in excess of his compensation covered by Social
Security.
Participants who were employed by the Company prior to August 1, 1988, are
eligible to receive the greater of their benefit determined under the Excess
Formula or their benefit determined under the Offset Formula. The Offset Formula
is: (i) total years of credited service multiplied by $120, plus (ii) average
salary multiplied by 25%, less 74% of the primary Social Security benefit.
Pursuant to changes required by the Tax Reform Act of 1986 the Company amended
the Plan to cease further accruals under the Offset Formula as of July 31, 1989.
Participants who were eligible to receive a benefit under the Offset Formula
will receive the greater of their benefit determined under the Excess Formula or
their benefit determined under the Offset Formula as of July 31, 1989. The
maximum permitted annual retirement income under either formula is $160,000.
The following table sets forth estimated annual retirement benefits payable
at age 65 for participants in certain compensation and years of service
classifications using the highest number obtainable under both formulas:
Five Highest ANNUAL BENEFITS
Consecutive -----------------------------------------------------------------------------
Years
Earnings 15 Year 20 Years 25 Years 30 Years 35 Years
-------- ------- -------- -------- -------- --------
$90,000 $ 12,300 $ 16,400 $ 20,500 $ 24,600 $ 28,600
120,000 17,700 23,600 29,500 35,400 41,200
150,000 23,100 30,800 38,500 46,200 53,800
180,000 30,600 38,000 47,500 57,000 66,400
Under the Plan, Arthur S. Wolcott and Kraig H. Kayser have 55 years and 12
years of credited service, respectively. Their compensation during fiscal 2004
covered by the Plan was $402,989 for Mr. Wolcott and $340,170 for Mr. Kayser.
The Internal Revenue Code limits the amount of compensation that can be taken
into account in calculating retirement benefits (for 2004 the limit is
$205,000).
Directors' Fees
Directors who are also executive officers of the Company are not separately
compensated for their services as directors. Directors who are not executive
officers receive a fee in the amount of $1,500 per month.
Equity Compensation Plans
No options were granted or exercised in the period from April 1, 2003, to
the date of this Proxy Statement, nor were any unexpired options held at the
latter date by any officer or director of the Company. The Company has no equity
compensation plans, therefore, no table is necessary as described in item 201(d)
of Regulation SK.
Profit Sharing Bonus Plan
The Company has a Profit Sharing Bonus Plan for certain eligible employees
of the Company ("Corporate Profit Sharing" for the officers and certain key
Corporate employees and "Operating Unit Profit Sharing" for certain key
Operating Unit employees). Under Corporate Profit Sharing, some or all of the
Corporate Profit Sharing Pool (10% of the Corporate Bogey as defined below) will
be paid only if Pre-Tax Profits (as defined) equal or exceed the Corporate
Bogey. The bonuses will be distributed at the sole discretion of the Chief
Executive Officer upon approval of such bonuses by the Compensation Committee of
the Board of Directors. Under the Operating Unit Profit Sharing, the Operating
Unit Profit Sharing pool (10% of Pre-Tax Profit less the Operating Unit Bogey as
defined below) will be paid only if the Pre-Tax Profit of the Operating Unit
equals or exceeds the Operating Unit Bogey. The bonuses will be distributed at
the discretion of the Operating Unit President. For fiscal 2004 the Corporate
Bogey will be equal to the greater of (i) five percent of the prior year's
Consolidated Net Worth of the Company plus the Pillsbury Subordinated Note or
(ii) five percent plus the annual increase in the Consumer Price Index greater
than five percent, times the prior year's Consolidated Net Worth of the Company.
The Operating Unit Bogey will be an amount equal to the average gross assets
employed by the Snack or Flight Operations for the preceding 12 months divided
by the consolidated average gross assets of the Company for the same period
multiplied by the Corporate Bogey. A total of $140,526 and $90,855 of bonuses
related to the Corporate Plan were earned by officers in 2004 and 2003,
respectively. No officers earned bonuses in 2002 under the Profit Sharing Bonus
Plan.
Compensation Committee Interlocks and Insider Participation
There were no Compensation Committee interlocks during the past fiscal
year.
Compensation Committee Report On Executive Compensation
The Compensation Committee is responsible for providing overall guidance
with respect to the Company's executive compensation programs. The goal of the
Compensation Committee is to maintain a competitive compensation program in
order to attract and retain well qualified management, to provide management
with the incentive to accomplish the Company's financial and operating
objectives and to link the interest of the Company's executive officers and
management to the interests of its stockholders through bonuses tied to
financial performance. The Compensation Committee is composed of three members
and meets annually to review the Company's compensation programs, including
executive salary administration and the profit sharing plan.
The Compensation Committee believes that the Company's executives should be
rewarded for their contributions to the Company's attaining annual financial
goals, as set forth in the annual budget, which is subject to revision during
the year, and their attaining annual individual objectives. The Company pays its
executive officers two principal types of compensation: base salary and
Corporate Profit Sharing plan, each of which is more fully described below.
Base Salary - The Company has historically established the base salary of
its executive officers on the basis of each executive officer's scope of
responsibility, experience, individual performance and accountability within the
Company. In that regard the Company reviews comparable salary and other
compensation arrangements in similar businesses and companies of similar size to
determine appropriate levels necessary to attract and retain top quality
management.
Profit Sharing Plan - To further align the interests of executive officers
with those of the Company's shareholders, a significant component of an
executive officer's total compensation arrangement is participation in the
annual profit sharing plan. An executive is rewarded with a cash bonus equal to
a percentage of the executive's base salary if the Pre-Tax Profit of the Company
for that year equals or exceeds the Corporate Bogey (see "--Profit Sharing Bonus
Plan").
Performance Review - The general policies described above for the
compensation of executive officers also apply to the compensation level approved
by the Compensation Committee with respect to the 2005 compensation for the
Chief Executive Officer. Based on the criteria outlined above, the Compensation
Committee awarded to Kraig H. Kayser a base salary of $415,992 for the fiscal
year 2005. The Compensation Committee recognized Mr. Kayser's leadership role in
guiding the overall performance of the Company towards its desired strategic
direction as well as managing costs.
Summary
The Compensation Committee is committed to attracting, motivating and
retaining executives who will help the Company meet the increasing challenges of
the food processing industry. The Compensation Committee recognizes its
responsibility to the Company's shareholders and intends to continue to
establish and implement compensation policies that are consistent with
competitive practice and are based on the Company's and the executives'
performance.
This report has been submitted by the Compensation Committee of the
Company's Board of Directors:
Douglas F. Brush Susan W. Stuart Andrew M. Boas
Audit Committee
The Audit Committee's Report for 2004 follows.
Audit Committee's Report
This Report is not soliciting material, is not deemed filed with the SEC
and is not to be incorporated by reference in any filing of the Company under
the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934,
as amended, whether made before or after the date hereof and irrespective of any
general incorporation language in any such filing.
The Audit Committee of the Board of Directors, comprised of four outside
directors, held five meetings during 2004. The Audit Committee operates under a
written charter approved by the Board of Directors.
The Audit Committee met with the independent public accountants and
management to assure that all were carrying out their respective
responsibilities. The Committee reviewed the performance of the independent
public accountants prior to recommending their appointment, and met with them to
discuss the scope and results of their audit work, including the adequacy of
internal controls and the quality of financial reporting. The Committee
discussed with the independent public accountants their judgments regarding the
quality and acceptability of the Company's accounting principles, the clarity of
its disclosures and the degree of aggressiveness or conservatism of its
accounting principles and underlying estimates. The Committee discussed with and
received a letter from the independent public accountants confirming their
independence. The independent public accountants had full access to the
Committee, including regular meetings without management present. Additionally,
the Committee reviewed and discussed the audited financial statements with
management and recommended to the Board of Directors that these financial
statements be included in the Company's Form 10-K filing with the Securities and
Exchange Commission.
Audit Committee
Arthur H. Baer
Chairman
G. Brymer Humphreys Douglas F. Brush
Robert T. Brady
INDEPENDENT PUBLIC ACCOUNTANTS
Ernst & Young LLP has served as our independent accounting firm since
October 7, 2003. On such date, we terminated Deloitte & Touche LLP from serving
as our independent public accounting firm. It is anticipated that
representatives of Ernst & Young LLP will be present at the annual meeting with
the opportunity to make a statement if they desire to do so and will be
available to respond to appropriate questions.
Principal Accountant Fees and Services
Fees for all services provided by Ernst & Young LLP and Deloitte & Touche
LLP for fiscal years 2003 and 2004 are as follows:
--------------------------------------------- ------------------- ------------------
2004 2003
---- ----
Audit Fees (1) $174,000 $106,000
--------------------------------------------- ------------------- ------------------
Audit-Related Fees (2) -- 43,000
--------------------------------------------- ------------------- ------------------
Tax Fees -- --
--------------------------------------------- ------------------- ------------------
All Other Fees -- --
--------------------------------------------- ------------------- ------------------
Total $174,000 $149,000
======== ========
(1) Audit fees represent fees for professional services provided in connection
with the audit of our financial statements and review of our quarterly financial
statements and audit services provided in connection with other statutory or
regulatory filings.
(2) Audit-related fees consisted primarily of acquisition accounting and
restatement work.
All audit-related services were pre-approved by the Audit Committee, which
concluded that the provision of such services by Deloitte & Touche LLP in 2003
was compatible with the maintenance of that firm's independence in the conduct
of its auditing functions. The Audit Committee's pre-approval policies provide
that the Chairman of the Audit Committee has the authority to approve individual
audit related and permitted non-audit engagements up to $10,000. Larger
engagements require majority Audit Committee approval. There were no engagements
of this type provided by the principal accountant during the last two years.
Changes in Certifying Accountant
On October 7, 2003, the Board of Directors unanimously approved the
recommendation of the Audit Committee to engage the accounting firm of Ernst &
Young LLP as its new independent public accountants for its audit engagement.
Also on October 7, 2003, the Company's Board of Directors unanimously approved
the recommendation of the Audit Committee to dismiss Deloitte & Touche LLP. The
Company's Certificate of Incorporation requires the unanimous approval of the
Board of Directors to effect the actions described in this paragraph. On October
7, 2003, the Company dismissed Deloitte & Touche LLP.
The reports of Deloitte & Touche LLP on the consolidated financial
statements of the Company, for the past two fiscal years ended March 31, 2003
and 2002 did not contain an adverse opinion or a disclaimer of opinion and were
not qualified or modified as to uncertainty, audit scope or accounting
principles.
The decision to change the Company's accounting firm was made by the Audit
Committee of the Company's Board of Directors on October 7, 2003.
In connection with the audits of the Company's financial statements for
each of the two fiscal years ended March 31, 2003 and 2002 and in the subsequent
interim periods from April 1, 2003 through and including October 7, 2003, there
were no disagreements between the Company and its auditors, Deloitte & Touche
LLP, on any matter of accounting principles or practices, consolidated financial
statement disclosure, or auditing scope and procedures, which, if not resolved
to the satisfaction of Deloitte & Touche LLP would have caused Deloitte & Touche
LLP to make reference to the matter in their reports.
There were no "reportable events" as that term is described in Item
304(a)(1)(v) of Regulation S-K during the last two fiscal years ended March 31,
2003 and 2002 or during the subsequent interim periods from April 1, 2003
through and including October 7, 2003.
The Company has not consulted with Ernst & Young LLP during the last two
fiscal years ended March 31, 2003 and 2002 or during the subsequent interim
periods from April 1, 2003 through and including October 7, 2003, on either the
application of accounting principles to a specified transaction, either
completed or proposed, or the type of audit opinion that might be rendered on
the Company's consolidated financial statements.
The Company requested Deloitte & Touche LLP to furnish a letter addressed
to the Securities and Exchange Commission stating whether Deloitte & Touche LLP
agree with the statements made above by the Company. Such letter was provided.
Common Stock Performance Graph
The following graph shows the cumulative, five-year total return for the
Company's Common Stock compared with the NASDAQ Market Index (which includes the
Company) and a peer group of companies (described below).
Performance data assumes that $100.00 was invested on March 31, 1999, in
the Company's Class B Common Stock, the NASDAQ Market, and the peer group. The
data assumes the reinvestment of all cash dividends and the cash value of other
distributions. Stock price performance shown in the graph is not necessarily
indicative of future stock price performance.
Comparison of Five Year Cumulative Total Return
Seneca Foods Corporation, NASDAQ US Total Return and Peer Group
Seneca Peer
Year Foods Group NASDAQ
---- ------ ----- ------
1999 100.00 100.00 100.00
2000 104.65 107.71 185.81
2001 120.93 102.86 74.39
2002 133.49 97.23 75.09
2003 170.98 76.86 55.03
2004 173.95 115.75 81.21
The companies in the peer group presented in the graph above are H.J. Heinz
Company, DelMonte Company, Hanover Foods, and Celestial Hain Group, Inc.
Currently the Company is primarily a vegetable processor. Management wishes
to include only vegetable processing companies in the peer group for the current
year's performance graph. Management was able to add the DelMonte Company this
year since it now has five years of history. Another vegetable processor,
Hanover Foods, was also added. We retained H.J. Heinz Company and Celestial Hain
Group, Inc., even though they are not primarily vegetable processors, because
some of our competitors are not publicly traded. Chiquita Brands International,
Inc., formerly in the peer group, was removed since it declared Chapter 11
bankruptcy on November 28, 2001. As a result, no former peer group is presented.
PROPOSAL 2
RATIFICATION OF SELECTION OF AUDITORS
The Board of Directors through its Audit Committee has selected Ernst &
Young LLP, independent public accountants, to act as auditors for the fiscal
year ending March 31, 2005.
Management recommends a vote FOR its proposal to ratify the appointment of
Ernst & Young LLP as independent auditors of the Company for the fiscal year
ending March 31, 2005. Unless marked otherwise, proxies will be voted FOR this
purpose.
* * * * *
BROKER NON-VOTES AND ABSTENTIONS
Broker non-votes will not be treated as votes cast or shares entitled to
vote on matters as to which the applicable rules of national securities
exchanges withhold the broker's authority to vote in the absence of direction
from the beneficial owner.
VOTING OF PROXIES
The shares represented by all valid proxies received will be voted in the
manner specified on the proxies. Where specific choices (including abstentions)
are not indicated, the shares represented by all valid proxies received will be
voted FOR the nominees for director named earlier in this Proxy Statement and
FOR approval of Proposal 2 as described earlier in this Proxy Statement.
Should any matter not described above be acted upon at the meeting, the
persons named in the proxy will vote in accordance with their judgment. The
Board knows of no other matters, which may be presented to the meeting.
SHAREHOLDER PROPOSALS FOR THE 2005 ANNUAL MEETING
Shareholder proposals must be received at the Company's offices no later
than February 21, 2005, in order to be considered for inclusion in the Company's
proxy materials for the 2005 Annual Meeting.
If a shareholder wishes to present a proposal at the Company's 2005 Annual
Meeting of Shareholders or to nominate one or more directors, and the proposal
is not intended to be included in the Company's proxy materials relating to that
meeting, such proposal or nomination(s) must be received at the Company's
offices by May 9, 2005.
MISCELLANEOUS
To assure a quorum at the annual meeting (the holders of a majority of the
stock entitled to vote thereat constitute a quorum), shareholders are requested
to sign and return promptly the enclosed form of proxy in the envelope provided.
A shareholder who has delivered a proxy may attend the meeting and, if he or she
desires, vote in person at the meeting.
By order of the Board of Directors,
JEFFREY L. VAN RIPER
Secretary
DATED: Marion, New York
June 29, 2004
SENECA FOODS CORPORATION
AUDIT COMMITTEE CHARTER
Dated as of May 27, 2004
This charter shall be reviewed, updated and approved annually by the Board
of Directors.
Purpose
The Audit Committee of the Board of Directors assists the Board in
fulfilling its responsibility for oversight of the quality and integrity of the
accounting, auditing and reporting practices of the Company and other such
duties as directed by the Board.
The Audit Committee members are not professional accountants or auditors
and their functions are not intended to duplicate or to certify the activities
of management and the independent auditor, nor can the Committee certify that
the independent auditor is "independent" under applicable rules. The Audit
Committee serves a board level oversight role where it oversees the relationship
with the independent auditor, as set forth in this charter, and provides advice,
counsel and general direction, as it deems appropriate, to management and the
auditors on the basis of the information it receives, discussions with the
auditor, and the experience of the Committee's members in business, financial
and accounting matters.
Membership
The membership of the Committee shall consist of at least three
directors determined by the Board of Directors to meet the independence and
financial literacy requirements of the NASDAQ Stock Market, Inc. and applicable
federal law. The Board of Directors shall appoint one member of the Audit
Committee as chairperson. He or she shall be responsible for leadership of the
Committee, including preparing the agenda, presiding over the meetings, making
Committee assignments and reporting to the Board of Directors. The chairperson
will also maintain regular liaison with the CEO, CFO, the lead independent audit
partner and the director of internal audit.
Appointment to the Committee and the designation of any Committee
members as "audit committee financial experts" shall be made on an annual basis
by the full Board upon the joint recommendation of the Audit Committee and the
Corporate Governance and Nominating Committee.
Meetings/Procedures
The Audit Committee shall meet as often as may be deemed necessary or
appropriate in its judgment, generally [four] times each year, either in person
or telephonically. The Committee is expected to maintain free and open
communication (including private executive sessions at least annually) with the
independent accountants, the internal auditors and the management of the
Company. The Audit Committee may create subcommittees who shall report to the
Audit Committee. The Audit Committee shall report to the full Board of Directors
with respect to its meetings. The majority of the members of the Audit Committee
shall constitute a quorum. The Audit Committee will engage in an annual
self-assessment with the goal of continuing improvement, and will annually
review and reassess the adequacy of its charter, and recommends any changes to
the full Board.
The Audit Committee believes that it will best carry out its
responsibilities to the directors and shareholders if its policies and
procedures remain flexible so that it may adjust and react to changing events
and conditions.
Outside Advisors
The Audit Committee shall have the authority to retain such outside
counsel, experts, and other advisors as it determines appropriate to assist in
the full performance of its functions. The Audit Committee shall have sole
authority to approve related fees and retention terms.
Audit Committee Charter
Page 2
Responsibilities
The Audit Committee's primary responsibilities include:
o The direct responsibility for the appointment, replacement,
compensation, and oversight of the work of the independent
auditor. The independent auditor shall report directly to the
Audit Committee.
o Requesting from the auditor a written affirmation that the
auditor is in fact independent, discussing with the auditor
any relationships that may impact the auditor's independence
and taking, or recommend that the full Board take, appropriate
action to oversee the auditor's independence.
o Establishing policies and procedures for the review and
pre-approval by the Committee of all auditing services and
permissible non-audit services (including the fees and terms
thereof) to be performed by the independent auditor, with
exceptions provided for de minimis amounts under certain
circumstances as described by law.
o Overseeing the independent auditor relationship by discussing
with the auditor the nature and rigor of the audit process,
the scope of the proposed audit for the current year,
receiving and reviewing audit reports, providing the auditor
full access to the Committee (and the Board) to report on any
and all appropriate matters, and reviewing and discussing with
the auditors and management the reports and recommendations by
the auditors.
o Providing guidance and oversight to the internal audit
activities of the Company including reviewing the
organization, plans and results of such activity.
o Reviewing the audited financial statements and discussing
them with management and the independent auditor.
These discussions shall include consideration of the quality
of the Company's accounting principles as applied in its
financial reporting, including review of estimates,
reserves and accruals, review of judgmental areas,
review of audit adjustments whether or not recorded and
such other inquiries as may be appropriate, and obtaining
confirmation from the auditors that they have communicated
to the Audit Committee all matters required to be
communicated by applicable Statements on Auditing Standards.
Based on the review, the Committee shall make its
recommendation to the Board as to the inclusion of the
Company's audited financial statements in the Company's
annual report on Form 10-K.
o Reviewing with management and the independent auditor the
quarterly financial information prior to the Company's filing
of Form 10-Q. This review may be performed by the Committee or
its chairperson.
o Reviewing and discussing with management, the independent
auditor, and the internal auditors: (a) the adequacy and
effectiveness of the Company's internal controls (including
any significant deficiencies and significant changes in
internal controls reported to the Committee by the independent
auditor or management; (b) the Company's internal audit
procedures; and (c) the adequacy and effectiveness of the
Company's disclosures controls and procedures, and management
reports thereon.
o Discussing with management the status of pending litigation,
taxation matters and other areas of oversight to the legal and
compliance area as may be appropriate.
o Reporting Audit Committee activities to the full Board and
issuing annually a report to be included in the proxy
statement (including appropriate oversight conclusions) for
submission to the shareholders.
o Reviewing related-party transactions (as defined in the
relevant NASDAQ requirements). The Committee has
prior-approval authority for such related-party transactions.
o Establishing procedures for the receipts, retention and
treatment of complaints received by the Company regarding
accounting, internal accounting controls, or auditing matters,
and the confidential, anonymous submission by employees of
concerns regarding questionable accounting or auditing
matters. The Committee is empowered to investigate any matter
brought to its attention, with full power to retain outside
counsel or other experts for this purpose.
SENECA FOODS CORPORATION
3736 South Main Street
Marion, NY 14505-9751
PROXY
FOR ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON AUGUST 6, 2004
The undersigned shareholder of SENECA FOODS CORPORATION (the "Company") hereby
appoints and constitutes ARTHUR S. WOLCOTT and KRAIG H. KAYSER, and either of
them, the proxy or proxies of the undersigned, with full power of substitution
and revocation, for and in the name of the undersigned to attend the annual
meeting of shareholders of the Company to be held at Holiday Inn South,
Rochester, Minnesota, on Friday, August 6, 2004, at 1:00 p.m., Central Daylight
Savings Time, and any and all adjournments thereof (the "Meeting"), and to vote
all shares of stock of the Company registered in the name of the undersigned and
entitled to vote at the Meeting upon the matters set forth below:
MANAGEMENT RECOMMENDS A VOTE FOR ITEM 1 AND FOR ITEM 2.
1. Election of Directors: Election of the one nominee to serve until the annual
meeting of 2006 and three nominees to serve until the annual meeting of
shareholders in 2007 and until their successors are duly elected and shall
qualify:
FOR all nominees listed below (except as WITHHOLD AUTHORITY to vote for
marked to all nominees the contrary below) listed below.
INSTRUCTION: To withhold authority to vote for any individual nominee,
strike a line through his name in the list below:
Thomas Paulson (2006), Andrew M. Boas (2007), Douglas F. Brush (2007),
Susan W. Stuart (2007)
2. Appointment of Auditors: Ratification of the appointment of Ernst & Young
LLP as independent auditors for the fiscal year ending March 31, 2005.
[ ] FOR [ ] AGAINST
[ ] ABSTAIN
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the Meeting or any adjournment thereof.
The shares represented by this Proxy will be voted as directed by the
shareholder. IF NO CHOICES ARE SPECIFIED, THIS PROXY WILL BE VOTED FOR ITEM 1
AND FOR ITEM 2.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
Signature_______________________________
________________________________________
Joint owners should each sign. Executors,
administrators, trustees, guardians, and
corporate officers should give their titles.
Dated:__________________________________
(PLEASE SIGN AND RETURN PROMPTLY)