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Unified Grocers, Inc. – ‘DEFM14A’ on 5/17/17

On:  Wednesday, 5/17/17, at 3:48pm ET   ·   Effective:  5/17/17   ·   Accession #:  1193125-17-173339   ·   File #:  0-10815

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  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 5/17/17  Unified Grocers, Inc.             DEFM14A     5/17/17    1:1.5M                                   Donnelley … Solutions/FA

Document/Exhibit                   Description                      Pages   Size 

 1: DEFM14A     Definitive Proxy Solicitation Material - Merger or  HTML   1.03M 
                          Acquisition                                            

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Rule 14a-101)

Filed by the Registrant  ☒                             Filed by a Party other than the Registrant  ☐

Check the appropriate box:

UNIFIED GROCERS, INC.

(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

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Unified Grocers, Inc.

5200 Sheila Street

Commerce, California 90040

May 17, 2017

Dear Shareholder,

We cordially invite you to attend a special meeting of shareholders of Unified Grocers, Inc., a California corporation, which we refer to as Unified, to be held on June 22, 2017, at 9:00 a.m., local time, at the Doubletree by Hilton Hotel, 13111 Sycamore Drive, Norwalk, California 90650, which we refer to as the special meeting.

On April 10, 2017, Unified entered into a merger agreement with SUPERVALU INC., a Delaware corporation, which we refer to as SVU, and West Acquisition Corporation, a California corporation and a wholly-owned subsidiary of SVU, which we refer to as Merger Sub. The merger agreement provides for the acquisition by SVU of Unified through the merger of Merger Sub with and into Unified, which we refer to as the merger, with Unified as the surviving corporation.

At the special meeting, you will be asked to consider and vote upon a proposal to approve the merger agreement, as such agreement may be amended from time to time, which we refer to as the merger agreement.

If the merger is completed, subject to the terms and conditions of the merger agreement, your Class A Shares, without par value, which we refer to as the Class A Shares, and Class B Shares, without par value, which we refer to as the Class B Shares, will be converted into the right to receive $200.27 per share in cash and your Class E Shares, without par value, which we refer to as the Class E Shares, will be converted into the right to receive $100.00 per share in cash, in each case without interest. We refer to the Class A Shares, the Class B Shares and the Class E Shares collectively as the Shares. Shares will be subject to the treatment set forth above notwithstanding whether they have previously been tendered to Unified for redemption.

Following consideration of the merger agreement and the transactions contemplated by the merger agreement, the Unified board, among other things, unanimously (i) approved, authorized and declared that the merger agreement and the merger and the other transactions contemplated by the merger agreement are fair to, and in the best interests of, Unified and its shareholders, (ii) declared that it is in the best interests of Unified and its shareholders that Unified enter into the merger agreement and consummate the transactions contemplated thereby on the terms and subject to the conditions set forth in the merger agreement, (iii) approved the voting agreements described in the accompanying proxy statement, and (iv) recommended, subject to Section 5.2 of the merger agreement, that the shareholders approve the merger and the merger agreement.

Approval of the proposal to approve the merger agreement requires (i) the affirmative vote of a majority of the outstanding Class A Shares entitled to vote at the special meeting, (ii) the affirmative vote of a majority of the outstanding Class B Shares entitled to vote at the special meeting and (iii) the affirmative vote of a majority of the outstanding Class E Shares entitled to vote at the special meeting. If a quorum with respect to the Class A Shares is present at the special meeting, approval of the proposal to approve, by non-binding, advisory vote, certain compensation arrangements for Unified’s named executive officers in connection with the merger requires the affirmative vote of the majority of the Class A Shares present in person or represented by proxy at

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the special meeting. Approval of the proposal to adjourn the special meeting, if necessary, desirable or appropriate, to solicit additional proxies if, at the time of the special meeting, there is an insufficient number of votes in favor of approving the merger agreement, requires the affirmative vote of the majority of the Class A Shares present in person or represented by proxy at the special meeting whether or not a quorum is present.

The board of directors of Unified unanimously recommends that you vote “FOR” the proposal to approve the merger agreement, “FOR” the proposal to approve, by non-binding, advisory vote, certain compensation arrangements for Unified’s named executive officers in connection with the merger and “FOR” the proposal to adjourn the special meeting, if necessary, desirable or appropriate, to solicit additional proxies if, at the time of the special meeting, there is an insufficient number of votes in favor of approving the merger agreement.

Your vote is very important. Whether or not you plan to attend the special meeting, please complete, date, sign and return, as promptly as possible, the enclosed proxy card in the envelope provided. If you attend the special meeting and vote in person, your vote by ballot will revoke any proxy previously submitted. The failure to submit a proxy or to vote will have the same effect as a vote “AGAINST” the proposal to approve the merger agreement. Failure to submit a proxy or to vote will not have an effect on the vote on (i) the proposal to approve, by non-binding, advisory vote, certain compensation arrangements for Unified’s named executive officers in connection with the merger assuming a quorum is present with respect to the Class A Shares and (ii) the proposal to adjourn the special meeting, if necessary, desirable or appropriate, to solicit additional proxies if, at the time of the special meeting, there is an insufficient number of votes in favor of approving the merger agreement.

The accompanying proxy statement provides you with detailed information about the special meeting, the merger agreement and the merger. A copy of the merger agreement is attached as Annex A to the proxy statement. We encourage you to read the entire proxy statement and its annexes, including the merger agreement, carefully. You may also obtain additional information about Unified from documents we have filed with the Securities and Exchange Commission.

If you have any questions or need assistance voting your Shares, please contact our Corporate Secretary, by calling (323) 881-4225, or by e-mailing mkasper@unifiedgrocers.com.

Thank you in advance for your cooperation and continued support.

Sincerely,

Robert M. Ling, Jr.

President & Chief Executive Officer

The proxy statement is dated May 17, 2017, and is first being mailed to Unified’s shareholders on or about May 19, 2017.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THE MERGER, PASSED UPON THE MERITS OR FAIRNESS OF THE MERGER AGREEMENT OR THE TRANSACTIONS CONTEMPLATED THEREBY OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE INFORMATION CONTAINED IN THE ACCOMPANYING PROXY STATEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

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Unified Grocers, Inc.

5200 SHEILA STREET

COMMERCE, CALIFORNIA 90040

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

To Be Held on June 22, 2017

To the Shareholders of Unified Grocers, Inc.:

Notice is hereby given that a special meeting, which we refer to as the special meeting, of the shareholders of Unified Grocers, Inc., a California corporation, which we refer to as Unified, will be held at 9:00 a.m., local time, on June 22, 2017, at the Doubletree by Hilton Hotel, 13111 Sycamore Drive, Norwalk, California 90650, for the following purposes:

The merger agreement, the merger and the other transactions contemplated by the merger agreement are described more fully in the attached proxy statement and the annexes thereto, and we urge you to read the proxy statement and its annexes carefully and in their entirety.

Following consideration of the merger agreement and the transactions contemplated by the merger agreement, the Unified board, among other things, unanimously (i) approved, authorized and declared that the merger agreement and the merger and the other transactions contemplated by the merger agreement are fair to, and in the best interests of, Unified and its shareholders, (ii) declared that it is in the best interests of Unified and its shareholders that Unified enter into the merger agreement and consummate the transactions contemplated thereby on the terms and subject to the conditions set forth in the merger agreement, (iii) approved the voting agreements described in the proxy statement, and (iv) recommended, subject to Section 5.2 of the merger agreement, that the shareholders approve the merger and the merger agreement.

Approval of the proposal to approve the merger agreement requires (i) the affirmative vote of a majority of the outstanding Class A Shares, without par value, which we refer to as the Class A Shares, entitled to vote at the special meeting, (ii) the affirmative vote of a majority of the outstanding Class B Shares, without par value, which we refer to as the Class B Shares, entitled to vote at the special meeting, and (iii) the affirmative vote of a majority of the outstanding Class E Shares, without par value, which we refer to as the Class E Shares, entitled to vote at the special meeting. If a quorum with respect to the Class A Shares is present at the special meeting, approval of the proposal to approve, by non-binding, advisory vote, certain compensation arrangements for Unified’s named executive officers in connection with the merger requires the affirmative vote of the majority of Class A Shares present in person or represented by proxy at the special meeting. Approval of the proposal to adjourn the special meeting, if necessary, desirable or appropriate, to solicit additional proxies if, at the time of the special meeting, there is an insufficient number of votes in favor of approving the merger agreement, requires the affirmative vote of the majority of the Class A Shares present in person or represented by proxy at the special meeting whether or not a quorum is present.

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The board of directors of Unified unanimously recommends that you vote “FOR” the proposal to approve the merger agreement, “FOR” the proposal to approve, by non-binding, advisory vote, certain compensation arrangements for Unified’s named executive officers in connection with the merger and “FOR” the proposal to adjourn the special meeting, if necessary, desirable or appropriate, to solicit additional proxies if, at the time of the special meeting, there is an insufficient number of votes in favor of approving the merger agreement.

Your vote is very important, regardless of the number of Shares you own. We refer to the Class A Shares, the Class B Shares and the Class E Shares collectively as the Shares. The merger cannot be completed unless the proposal to approve the merger agreement is approved by the affirmative vote of holders of a majority of the outstanding Shares entitled to vote on the proposal on a class by class basis. Even if you plan to attend the special meeting in person, we request that you complete, sign, date and return, as promptly as possible, the enclosed proxy card in the accompanying prepaid reply envelope prior to the special meeting to ensure that your Shares will be represented at the special meeting if you are unable to attend. If you fail to cause your Shares to be present and voted at the special meeting either by failing to attend the special meeting and voting thereat or failing to return your proxy card, it will have the same effect as a vote “AGAINST” the proposal to approve the merger agreement.

The board of directors of Unified has fixed the close of business on May 16, 2017 as the record date for determining the shareholders entitled to receive notice of, and to vote at, the special meeting and any adjournments or postponements thereof. Only shareholders of record at the close of business on the record date are entitled to receive notice of, and to vote at (in person or by proxy), the special meeting and at any adjournment or postponement thereof. You are entitled to one vote for each Share that you owned on the record date for each matter that such class of Shares is entitled to vote upon at the special meeting. A complete list of our shareholders of record entitled to vote at the special meeting will be available for inspection at our principal place of business for a period of at least ten days prior to the date of the special meeting during ordinary business hours of Unified for any purpose germane to the special meeting. The list of our shareholders of record will also be available during the special meeting at the place of the special meeting for inspection by any shareholder present at the special meeting for any purpose germane to the special meeting.

Only shareholders of record, their duly authorized proxy holders and our guests may attend the special meeting. If you are the representative of a corporate or other shareholder entity, you must present valid photo identification along with proof that you are the representative of such shareholder. Please note that cameras, recording devices and other electronic devices will not be permitted at the special meeting.

WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN, AS PROMPTLY AS POSSIBLE, THE ENCLOSED PROXY CARD IN THE ACCOMPANYING PREPAID REPLY ENVELOPE. IF YOU ATTEND THE SPECIAL MEETING AND VOTE IN PERSON, YOUR VOTE BY BALLOT WILL REVOKE ANY PROXY PREVIOUSLY SUBMITTED.

By Order of the Board of Directors,

Mary M. Kasper

Senior Vice President, General Counsel and Secretary

Commerce, California

Dated: May 17, 2017

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER

The following questions and answers are intended to address briefly some commonly asked questions regarding the merger, the merger agreement and the special meeting. These questions and answers may not address all questions that may be important to you as a shareholder of Unified. Please refer to the “Summary” and the more detailed information contained elsewhere in this proxy statement, the annexes to this proxy statement and the documents referred to in this proxy statement, which you should read carefully and in their entirety.

For a discussion of certain obligations of Unified with respect to members who are in default of their secured payment obligations or who financed their purchase of Shares, see “The Merger Agreement—Exercise of 9607 Rights”.

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If you hold any certificates representing Shares please do NOT return your certificates at this time.

SVU and the surviving corporation’s obligations specified above will not apply to changes that are the direct result of changes in taxes, product or trademark availability from a vendor (including as a result of a change in, addition or termination of a vendor), commodity cost changes, vendor price changes or the extinguishment of patronage payments to members and will apply only with respect to a member to the extent such member:

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See “The Merger Agreement—Products and Services Continuation” for additional information.

Shareholders affiliated with directors of Unified have entered into voting agreements with SVU, pursuant to which they have agreed to vote “FOR” the merger proposal and “FOR” any other actions related thereto. For more information regarding the voting agreements, please see “Voting Agreements”.

Completion of the merger is also subject to other customary conditions in favor of the parties, regarding the accuracy of the other party’s or parties’ representations and warranties (generally subject to a material adverse effect standard) and the other party’s or parties’ performance in all material respects of its obligations contained in the merger agreement.

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Because the affirmative vote required to approve the merger proposal is based upon the total number of outstanding Shares of each class entitled to vote on the proposal, if you fail to submit a proxy or vote in person at the special meeting, or abstain, it will have the same effect as a vote “AGAINST” the merger proposal.

Accordingly, abstentions will have the same effect as a vote “AGAINST” the merger-related executive compensation proposal. If a quorum with respect to the Class A Shares is a present at the special meeting, if you fail to submit a proxy or attend the special meeting in person, the Class A Shares held by you will not be counted in respect of, and will not have an effect on, the merger-related executive compensation proposal.

Accordingly, abstentions will have the same effect as a vote “AGAINST” the adjournment proposal. If you fail to submit a proxy or attend the special meeting in person, the Class A Shares held by you will not be counted in respect of, and will not have an effect on, the proposal to adjourn the special meeting.

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If you return a signed proxy card, but do not indicate how you wish your Shares to be voted, the Shares represented by your properly signed proxy will be voted “FOR” the merger proposal, “FOR” the merger-related named executive officer compensation proposal and “FOR” the adjournment proposal.

For the merger-related named executive compensation proposal, you may vote “FOR”, “AGAINST” or “ABSTAIN”. Abstentions will have the same effect as if you voted “AGAINST” the merger –related named executive compensation proposal.

For the adjournment proposal, you may vote “FOR”, “AGAINST” or “ABSTAIN”. Abstentions will have the same effect as if you voted “AGAINST” the adjournment proposal.

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Statements about Unified and its business in this proxy statement which are not statements of historical fact, including, but not limited to, statements regarding the expected completion of the merger (including the timing thereof), the ability to consummate the merger (including but not limited to the receipt of all required regulatory approvals), Unified’s future strategy and plans and commentary regarding future results of operations and prospects, are forward-looking statements and are intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by terminology such as “may”, “might”, “will”, “should”, “could”, “likely”, “expects”, “intends”, “targets”, “assumes”, “seeks to”, “plans”, “anticipates”, “believes”, “projects”, “estimates”, “predicts”, “potential”, “future”, “goal”, “objective”, or “continue”, or the negative of such terms or other variations thereof or comparable terminology, or by discussions of strategy that involve risks and uncertainties. Forward-looking statements are not guarantees or assurances of future performance, and actual results could differ materially from those indicated by the forward-looking statements.

Actual results may differ materially from those set forth in this proxy statement due to the risks and uncertainties related to the merger and/or inherent in our business, including, without limitation: the risk that shareholders of Unified do not approve the merger; the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; the response by shareholders to the merger; the failure to satisfy each of the conditions to the consummation of the merger, including but not limited to, the risk that a governmental entity may prohibit, delay or refuse to grant approval for the consummation of the merger on acceptable terms, or at all; risks related to disruption of management’s attention from Unified’s ongoing business operations due to the merger; the effect of the announcement of the merger on Unified’s relationships with its customers or suppliers, operating results and business generally; the outcome of any legal proceedings that could be filed related to the merger; risks related to employee retention as a result of the merger; the risk that the merger will not be consummated within the expected time period or at all; the competitiveness of the markets in which Unified operates; the risk that concentration of Unified’s customer base will continue to increase; the risk that Unified may have reduced sales and earnings if Unified’s members or customers lose market share to larger, often fully integrated traditional full-service grocery store chains or other similar non-traditional format stores; the risk that Unified will be unable to achieve its strategic plan in light of, among other things, inherent execution, competition, industry-wide and member-related risks; changes in relevant laws and regulations; political instability and management’s ability to successfully manage Unified’s operations.

These forward-looking statements are also qualified by, and should be read together with, the “Forward-Looking Statements”, the “Risk Factors” and the other statements in Unified’s Annual Report on Form 10-K for the year ended October 1, 2016 as filed with the Securities and Exchange Commission and available at www.sec.gov, and investors should refer to such risk factors and other statements in evaluating the forward-looking statements contained in this proxy statement (see “Where You Can Find More Information”).

Any forward-looking statements speak only as of the date of this proxy statement, and Unified does not undertake any obligation to correct or update any forward-looking statements to reflect events or circumstances after the date on which such statements are made or to reflect the occurrence of unanticipated events except as otherwise required by law. New factors may emerge from time to time, and it is not possible for Unified to predict all such factors. Furthermore, it may not be possible for Unified to assess the impact of any such factor on its business (viewed independently or together) or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. The foregoing factors should not be construed as exhaustive.

You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this proxy statement or, in the case of documents referred to herein, the dates of those documents.

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PARTIES TO THE MERGER

Unified Grocers, Inc.

Unified Grocers, Inc.

5200 Sheila Street

Commerce, CA 90040

Telephone: (323) 264-5200

Unified Grocers, Inc. is a California corporation organized in 1922 and incorporated in 1925. Unified is a retailer-owned, grocery wholesale cooperative serving supermarket, specialty, restaurant supply (through Cash & Carry Stores, LLC, a wholly-owned subsidiary of Smart & Final, Inc.) and convenience store operators located primarily in the western United States and the Pacific Rim. Unified sells a wide variety of products typically found in supermarkets, including dry grocery, frozen food, deli, ethnic, gourmet, specialty foods, natural and organic, general merchandise, health and beauty care, service deli, service bakery, meat, eggs, produce, bakery and dairy products. Unified also provides financing services to its customers, as well as various support services, including merchandising, retail pricing, advertising, promotional planning, retail technology, equipment purchasing and real estate services. Unified has three separate geographical and marketing regions: Southern California, Northern California and the Pacific Northwest.

Unified maintains a website at http://www.unifiedgrocers.com. By including the foregoing website address, Unified does not intend to and will not be deemed to incorporate by reference any material contained therein. See also “Where You Can Find More Information”.

SUPERVALU INC.

SUPERVALU INC.

11840 Valley View Road

Eden Prairie, MN 55344

(952) 828-4000

SUPERVALU INC. is the largest public company grocery distributor to wholesale customers across the United States through its wholesale segment, operates five retail grocery banners in six geographic regions through its retail segment and provides professional service solutions to retail operators and other entities. SVU leverages its distribution operations by providing wholesale distribution and logistics service solutions to wholesale customers as well as wholesale distribution to SVU’s retail stores. SUPERVALU INC., a Delaware corporation, was organized in 1925 as the successor to two wholesale grocery firms established in the 1870s. Substantially all of SVU’s operations are domestic. SVU has annual sales of approximately $12 billion and serves its customers across the United States through a network of 2,363 stores, including 1,902 stores operated by wholesale customers serviced primarily by SVU’s food distribution business and 217 traditional retail grocery stores operated under five retail banners in six geographic regions (store counts as of February 25, 2017).

SVU maintains a website at http://www.supervalu.com. By including the foregoing website address, neither SVU nor Unified intends to and will not be deemed to incorporate by reference any material contained therein.

Merger Sub

West Acquisition Corporation

11840 Valley View Road

Eden Prairie, MN 55344

(952) 828-4000

West Acquisition Corporation is a California corporation and wholly-owned subsidiary of SVU. Merger Sub was formed by SVU for the purpose of engaging in the transactions contemplated by the merger agreement and has not engaged in any business activities other than those incidental to its formation and in connection with the transactions contemplated by the merger agreement. Upon completion of the merger of Merger Sub with and into Unified, with Unified being the surviving corporation, Merger Sub will cease to exist as a separate entity.

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THE SPECIAL MEETING

Date, Time and Place of the Special Meeting

This proxy statement is being furnished to our shareholders as part of the solicitation of proxies by the Unified board for use at the special meeting to be held on June 22, 2017, at 9:00 a.m., local time, at the Doubletree by Hilton Hotel, 13111 Sycamore Drive, Norwalk, California 90650, or at any postponement or adjournment thereof.

Purpose of the Special Meeting

At the special meeting, holders of the Class A Shares, Class B Shares and Class E Shares will be asked to consider and vote upon a proposal to approve the merger agreement, which we refer to as the merger proposal (Proposal 1 on your proxy card).

In addition, at the special meeting, holders of the Class A Shares will be asked to consider and vote upon:

The Unified board unanimously recommends that you vote “FOR” each of the above proposals.

Unified’s shareholders must approve the merger proposal in order for the merger to occur. If our shareholders fail to approve the merger proposal, the merger will not occur. A copy of the merger agreement is attached as Annex A to this proxy statement, which we encourage you to read carefully and in its entirety.

Record Date and Quorum

We have fixed the close of business on May 16, 2017 as the record date for the determination of shareholders entitled to notice of, and to vote at, the special meeting, and only holders of record of Shares on the record date are entitled to notice of, and to vote at (in person or by proxy), the special meeting. As of the close of business on the record date, there were (i) 121,450 Class A Shares outstanding and entitled to vote, held by 347 holders of record, (ii) 403,325 Class B Shares outstanding and entitled to vote, held by 507 holders of record and (iii) 86,254 Class E Shares outstanding and entitled to vote, held by 631 holders of record.

Holders of a majority of the Shares entitled to vote on a matter at the special meeting, present in person or represented by proxy, will constitute a quorum for the transaction of business on such matter at the special meeting. A shareholder who returns a signed proxy will be treated as present at the special meeting for purposes of determining the presence or absence of a quorum. In the event that a quorum is not present at the special meeting, the special meeting and any adjourned or postponed session of the special meeting may be adjourned or postponed to solicit additional proxies. With respect to each of the Class A Shares, Class B Shares and Class E Shares, a quorum consists of at least 50% of the outstanding Shares of such class plus one.

Number of Votes

You are entitled to one vote for each Share that you owned on the record date for each matter that such class of Shares is entitled to vote upon at the special meeting.

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Attendance

Only shareholders of record, their duly authorized proxy holders and our guests may attend the special meeting. If you are the representative of a corporate or other shareholder entity, you must present valid photo identification along with proof that you are the representative of such shareholder. Please note that cameras, recording devices and other electronic devices will not be permitted at the special meeting.

Vote Required and Abstentions

Merger Proposal

Approval of the merger proposal requires (i) the affirmative vote of a majority of the outstanding Class A Shares entitled to vote at the special meeting, (ii) the affirmative vote of a majority of the outstanding Class B Shares entitled to vote at the special meeting and (iii) the affirmative vote of a majority of the outstanding Class E Shares entitled to vote at the special meeting.

For the merger proposal, you may vote “FOR”, “AGAINST” or “ABSTAIN”. Abstentions will not be counted as votes cast in favor of the merger proposal, but will count for the purpose of determining whether a quorum is present. If you fail to submit a proxy or to vote in person at the special meeting, or abstain, it will have the same effect as a vote “AGAINST” the merger proposal.

Merger-Related Named Executive Officer Proposal

If a quorum with respect to the Class A Shares is present at the special meeting, approval of the merger-related named executive officer compensation proposal requires the affirmative vote of the majority of the Class A Shares present in person or represented by proxy at the special meeting.

For the merger-related named-executive officer compensation proposal, you may vote “FOR”, “AGAINST” or “ABSTAIN”. For the merger-related named-executive officer compensation proposal, if you attend the special meeting and abstain on this proposal, or if you have given a proxy and abstained on this proposal, it will have the same effect as if you voted “AGAINST” approval of the merger-related named executive officer compensation proposal. If you fail to submit a proxy or attend the special meeting in person, the Class A Shares held by you will not be counted in respect of, and will not have an effect on, the merger-related named executive compensation proposal.

Adjournment Proposal

Approval of the adjournment proposal requires the affirmative vote of the majority of Class A Shares represented either in person or by proxy at the special meeting. For the adjournment proposal, you may vote “FOR”, “AGAINST” or “ABSTAIN”. For the adjournment proposal, if you attend the special meeting and abstain on this proposal, or if you have given a proxy and abstained on this proposal, this will have the same

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effect as if you voted “AGAINST” approval of the adjournment proposal. If you fail to submit a proxy or attend the special meeting in person, the Class A Shares held by you will not be counted in respect of, and will not have an effect on, the proposal to adjourn the special meeting.

Voting Agreements

Certain shareholders of Unified who are affiliated with directors of Unified have entered into voting agreements with SVU, pursuant to which each such shareholder has agreed to vote “FOR” the merger proposal and any matter that could reasonably be expected to facilitate the merger, “AGAINST” alternative acquisition proposals and “AGAINST” against any matter that would cause a breach of the terms of the merger agreement or otherwise frustrate the purposes, or prevent or materially delay the consummation, of the transactions contemplated by the merger agreement. The voting agreements also generally prohibit such shareholders from entering into agreements regarding or transferring their Shares, subject to certain exceptions. As of the close of business on the record date, these shareholders beneficially owned, in the aggregate, (i) 4,550 Class A Shares, allowing them to exercise approximately 3.75% of the voting power of the Class A Shares, (ii) 92,814 Class B Shares, allowing them to exercise approximately 23.01% of the voting power of the Class B Shares and (iii) 17,941 Class E Shares, allowing them to exercise approximately 20.80% of the voting power of the Class E Shares. The voting agreements will terminate upon the earlier to occur of (i) the effective time of the merger, (ii) the termination of the merger agreement in accordance with its terms, or (iii) a written agreement between SVU and the applicable shareholder terminating the applicable agreement.

Voting at the Special Meeting

If you are a shareholder of record, you may have your Shares voted on matters presented at the special meeting in any of the following ways:

Please refer to the instructions on your proxy card to determine the deadlines for submitting your proxy. Your proxy card should be mailed in the accompanying prepaid reply envelope, and your proxy card must be filed with our Corporate Secretary by the time the special meeting begins. When the merger is completed, a separate letter of transmittal will be mailed to you that will enable you to receive the applicable per share merger consideration in exchange for your Shares.

If you submit a proxy, the individuals named on the enclosed proxy card, and each of them, with full power of substitution, will vote your Shares in the way that you indicate. When completing the proxy card, you may specify whether your Shares should be voted “FOR”, “AGAINST” or “ABSTAIN” on all, some or none of the specific items of business to come before the special meeting.

If you properly sign your proxy card but do not mark the boxes showing how your Shares should be voted on a matter, the Shares represented by your properly signed proxy will be voted “FOR” approval of the merger proposal, “FOR” approval of the merger-related named executive officer compensation proposal (with respect to your Class A Shares) and “FOR” approval of the adjournment proposal (with respect to your Class A Shares).

If you have any questions or need assistance voting your Shares, please contact our Corporate Secretary, by calling (323) 881-4225, or by e-mailing mkasper@unifiedgrocers.com.

IT IS IMPORTANT THAT YOU VOTE YOUR SHARES PROMPTLY. WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN, AS PROMPTLY AS POSSIBLE, THE ENCLOSED PROXY CARD IN THE ACCOMPANYING PREPAID REPLY ENVELOPE. SHAREHOLDERS WHO ATTEND THE SPECIAL MEETING MAY REVOKE THEIR PROXIES BY VOTING IN PERSON.

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Proxies and Revocation

Any shareholder of record entitled to vote at the special meeting may submit a proxy by returning the enclosed proxy card in the accompanying prepaid reply envelope, or may vote in person by appearing at the special meeting. If you fail to submit a proxy or to vote in person at the special meeting, your Shares will not be voted on the merger proposal, which will have the same effect as a vote “AGAINST” approval of the merger proposal. Assuming a quorum with respect to the Class A Shares, if you fail to submit a proxy or attend the special meeting in person, the Class A Shares held by you will not be counted in respect of, and will not have an effect on, the merger-related named executive officer compensation proposal. If you fail to submit a proxy or attend the special meeting in person, the Class A Shares held by you will not be counted in respect of, and will not have an effect on, the adjournment proposal.

You have the right to revoke a proxy at any time before it is exercised, by submitting a later dated proxy, by giving written notice of revocation to Unified’s Corporate Secretary, which must be filed with the Corporate Secretary by 5:00 p.m. on the business day immediately prior to the date of the special meeting, or by attending the special meeting and voting in person. Attending the special meeting alone, without voting at the special meeting, will not be sufficient to revoke your proxy. Written notice of revocation should be mailed to: Unified Grocers, Inc., Attention: Corporate Secretary, 5200 Sheila Street, Commerce, California 90040.

Adjournments

Although it is not currently expected, the special meeting and any adjourned or postponed session of the special meeting may be adjourned, if necessary, desirable or appropriate, to solicit additional proxies if, at the time of the special meeting, there is an insufficient number of votes in favor of approving the merger proposal. Pursuant to the bylaws, approval of the adjournment proposal, whether or not a quorum is present or represented by proxy, requires the affirmative vote of the majority of the Class A Shares represented either in person or by proxy at the special meeting. Any adjournment of the special meeting for the purpose of soliciting additional proxies will allow Unified’s shareholders who have already sent in their proxies to revoke them at any time prior to their use at the special meeting as adjourned.

Anticipated Date of Completion of the Merger

We are working towards completing the merger as soon as possible. The closing is required to take place on the third business day following the date that the conditions set forth in the merger agreement (described in “The Merger Agreement—Conditions to Completion of the Merger”) have been satisfied or, to the extent permissible, waived by the party or parties entitled to the benefit of such conditions, or at such other place or time as SVU and Unified may mutually agree. Assuming timely satisfaction of the necessary closing conditions, we currently expect the closing to occur in mid-to-late summer 2017. The merger will become effective (i) at such time as the merger agreement and officers’ certificates satisfying the applicable requirements of the CGCL are duly filed with the Secretary of State of the State of California or (ii) at such later time as SVU and Unified have agreed on and is specified in the merger agreement and the applicable officers’ certificates. See “The Merger Agreement— Effects of the Merger”.

Dissenters’ Rights for Shareholders of Unified

Shareholders of Unified are entitled to exercise dissenters’ rights under the CGCL. This means that you are entitled to have the fair market value of your Shares determined by the California Superior Court and to receive payment based on that valuation in lieu of receiving the applicable merger consideration if you follow exactly the procedures specified under Chapter 13 of the CGCL. Shareholders of Unified considering whether to exercise dissenters’ rights should consider that the fair market value of their Shares determined under Chapter 13 of the CGCL could be more than, the same as or less than the value of consideration to be paid in connection with the merger.

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To exercise dissenters’ rights, you must NOT vote (either in person or by proxy) in favor or the merger proposal. A copy of Chapter 13 of the CGCL is attached to this proxy statement as Annex C. Annex C should be reviewed carefully by any shareholder who wishes to exercise dissenters’ rights or who wishes to preserve the right to do so, since failure to comply with the procedures of the relevant statute in any respect will result in the loss of dissenters’ rights. For more a more detailed discussion on dissenters’ rights, see “Dissenters’ Rights”.

Solicitation of Proxies; Payment of Solicitation Expenses

The cost of soliciting the proxies, consisting of the preparation, printing, handling and mailing of the proxies and the related material, will be paid by Unified. Officers and regular employees of Unified may solicit proxies by telephone, facsimile, e-mail or in person. These persons will receive no additional compensation for their services. The total estimated cost of the solicitation of proxies is approximately $20,000, excluding the costs of salaries and wages of regular employees and officers.

Questions and Additional Information

If you have more questions about the merger or how to submit your proxy, or if you need additional copies of this proxy statement or the enclosed proxy card or voting instructions, please contact our Corporate Secretary, by calling (323) 881-4225, or by e-mailing mkasper@unifiedgrocers.com.

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THE MERGER (PROPOSAL 1)

This discussion of the merger is qualified in its entirety by reference to the merger agreement, which is attached to this proxy statement as Annex A. You should read the entire merger agreement carefully as it is the legal document that governs the merger.

The merger agreement provides that, on the terms and subject to the conditions of the merger agreement, Merger Sub will be merged with and into Unified, with Unified surviving the merger as a wholly-owned subsidiary of SVU. As a result of the merger, current Unified shareholders will no longer hold any Shares in Unified and all of the incidents of Share ownership, such as the right to vote on certain corporate decisions, to elect directors and to receive dividends and patronage distributions from Unified will be extinguished.

Merger Consideration

At the effective time of the merger, each Class A Share and each Class B Share (other than excluded shares) will be converted into the right to receive $200.27 per share in cash and each Class E Share (other than excluded shares) will be converted into the right to receive $100.00 per share in cash, in each case without interest.

As of the effective time, all such Shares will no longer be outstanding and will automatically be cancelled and will cease to exist, and will thereafter represent only the right to receive the merger consideration to be paid in accordance with the merger agreement, without interest.

Unified’s organizational documents give the Unified board the absolute discretion to redeem or not to redeem any Shares of any outgoing member regardless of when membership terminated and any Class B Shares in excess of the Class B share requirement held by a current member, whether or not the shares have been tendered for redemption and regardless of when the shares were tendered. Historically, Unified has redeemed Class A Shares and Class B Shares based on the “exchange value”, as defined in Unified’s bylaws, as of the end of Unified’s fiscal year preceding the termination of membership or the time when such Shares were tendered for redemption (less any amounts owing to Unified). Notwithstanding that you may have previously tendered Shares to Unified for redemption and the “exchange value” as of the time of such tender, until the Unified board has exercised its discretion to redeem such Shares, the applicable Shares remain outstanding. It is not anticipated that the Unified board will redeem any Shares other than Class E Shares pending the consummation of the merger. Therefore, any Shares outstanding as of the effective time, including Shares previously tendered for redemption, will, subject to certain obligations of Unified pursuant to the merger agreement, be converted into the right to receive $200.27 in cash per Class A Share or Class B Share or $100.00 in cash per Class E Share, in each case without interest.

For a discussion of certain obligations of Unified with respect to members who are in default of their secured payment obligations or who financed their purchase of Shares, see “The Merger Agreement—Exercise of 9607 Rights”.

Deposits

Unified requires members who do not satisfy certain requirements with respect to the Class B Shares to make a required deposit with Unified and certain members may have made excess deposits. The merger agreement provides that at the closing, SVU will make a payment to Unified in respect of all required and excess deposits and such required deposits and excess deposits will then be paid reasonably promptly to the applicable member. If you have been required to provide a credit deposit in accordance with levels established by Unified’s credit office, these amounts will remain outstanding in support of your continuing business with the surviving corporation.

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Background of the Merger

The Unified board, along with Unified’s senior management, regularly reviews Unified’s operations, financial performance and strategies. As part of this review, from time to time, the Unified board has considered a variety of strategic alternatives to maximize shareholder value and enable Unified to provide superior products and services to help its members and customers compete with large grocery companies and other grocery channels and serve the communities in which they operate. In March of 2016, Mr. Robert Ling, Jr., Unified’s president and chief executive officer, and Mr. Mike Henn, Unified’s chief financial officer at the time, had preliminary discussions with Mr. Mark Gross, chief executive officer of SVU, and Mr. Rob Woseth, executive vice president and chief strategy officer of SVU, to discuss SVU’s possible interest in a strategic transaction with Unified. In connection with the ongoing review of Unified’s strategic alternatives, in the first half of 2016, Unified’s management worked with the Unified board to develop a comprehensive strategic plan, which we refer to as the strategic plan, focused on growing sales (primarily through additional current member sales), optimizing costs (including through rationalizing and modernizing Unified’s distribution center network) and improving Unified’s profitability and capitalization, including delevering Unified’s balance sheet.

In connection with the development of the strategic plan, members of management of Unified made several presentations to the Unified board. Over the course of these presentations, the Unified board discussed various risks inherent in achieving the strategic plan, including, but not limited to, execution risks, competition risks and member related risks, including member/customer alternative sourcing, continued declines in membership, increased sales concentration among large members/customers and the capital investment that would be required to implement the strategic plan. The Unified board also considered changes occurring in the grocery industry, including consolidation among wholesale competitors and food retailers, declining market shares by conventional supermarkets, and growth in discount and specialty grocery formats. In light of these considerations, the Unified board determined that it would be advisable to engage both legal and financial advisors to assist the Unified board in evaluating its strategic alternatives, including the strategic plan, and determine which course of action would best serve Unified’s members. On April 29, 2016, Unified engaged Sullivan & Cromwell LLP, whom we refer to as S&C, as its counsel in connection with these activities.

On June 2, 2016, Unified engaged Moelis & Company LLC, whom we refer to as Moelis, to assist Unified in conducting a business and financial analysis, including an evaluation of the strategic plan. The Unified board engaged Moelis because Moelis is an internationally recognized investment banking, financial advisory and securities firm whose senior professionals have substantial experience advising companies in, among other industries, the food retail and distribution sector.

On June 22, 2016, the Unified board held a meeting that was also attended by certain members of management and representatives of Moelis. At the meeting, members of management presented the strategic plan and the Unified board discussed in detail the components thereof. In addition, representatives of Moelis discussed a range of potential strategic alternatives, including maintaining the status quo, executing the strategic plan, evaluating a potential sale of Unified or a portion of Unified and capital raising alternatives from potential strategic or financial partners in order to delever Unified’s balance sheet. The Unified board discussed, among other things, the risks involved in executing the strategic plan, recent industry trends and the potential value in Unified’s market position and specialty distribution operations at this time. Following the discussion and in light of the risks inherent in the strategic plan, the Unified board authorized its chairman Mr. Richard E. Goodspeed to appoint a special committee of the Unified board to work with management and Moelis on a further analysis of the strategic plan. The Unified board directed management to focus on operating performance and implementing the strategic plan while simultaneously working with Moelis to explore the value that could be achieved in a sale process, including identifying and reaching out to parties that might be interested in a potential acquisition of Unified and could provide Unified’s members with the long-term supply and services necessary for them to operate their businesses. The Unified board also approved the engagement of Moelis as its financial advisor in connection with exploring potential transactions involving the acquisition of Unified and/or its specialty distribution business and delegated approval of the final terms of such engagement to the special committee.

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In July 2016, at the direction of the Unified board, members of management met with representatives of Moelis to discuss initial outreach to two potential strategic acquirors, including SVU and another company, whom we refer to as Company A, that management and Moelis believed might be interested in a potential acquisition of Unified based on their professional judgment and knowledge of the marketplace and previous discussions and that would have the capabilities to meet members’ long-term supply needs at the lowest possible cost. At the direction of the Unified board, management authorized Moelis to contact SVU and Company A to invite them to participate in a process to acquire Unified. S&C prepared confidentiality agreements to be executed by SVU and Company A, and Moelis sent the agreements to SVU and Company A on July 20. Also, at the direction of the Unified board, management considered whether to contact another company, whom we refer to as Company B, but determined not to do so at this time based on the view that SVU would be the best possible acquirer if they were prepared to make an offer at an attractive price in light of the compatibility of SVU with the Unified member base.

On July 26, 2016, the special committee of the Unified Board, which we refer to as the special committee, consisting of Mr. Richard Goodspeed and Messrs. Paul Kapioski, Darioush Khaledi, Roger Laverty and Brad Alford, each appointed by Mr. Goodspeed in accordance with the prior direction of the Unified board, held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. Representatives of S&C discussed the fiduciary duties of the special committee and the Unified board generally and in connection with a potential sale process. The special committee and representatives of S&C also discussed the importance of identifying any conflicts of interest and the special committee confirmed that no such conflicts existed for the committee members. The special committee and representatives of S&C also reviewed the authorizing resolutions of the special committee to be adopted by the special committee and ratified by the Unified board. In addition, the special committee reviewed and approved the terms of the Moelis engagement. Members of Unified management reviewed a draft confidential information presentation prepared by members of Unified management with the assistance of Moelis that was to be shared with potential bidders, including certain unaudited financial forecasts contained in the strategic plan, which we refer to as the strategic plan forecasts. For a more detailed discussion of the strategic plan forecasts, please see below under the caption “—Certain Unaudited Unified Forecasts”. Members of management also updated the special committee on prior discussions with Moelis and S&C regarding potential interested parties and the preliminary outreach that had taken place with SVU and Company A.

On August 2, 2016, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. Senior management of Unified updated the special committee on the confidential information presentation to be shared with SVU and Company A and the status of negotiations regarding confidentiality agreements with SVU and Company A, including that Company A had executed a confidentiality agreement on the preceding day and that SVU was expected to execute a confidentiality agreement later on August 2, 2016.

Following the execution of the respective confidentiality agreements, SVU and Company A were provided with the confidential information presentation on August 3, 2016 and access to an electronic data room with certain other diligence materials regarding Unified on August 8, 2016. On August 9, 2016, at the direction of the special committee, Moelis sent SVU and Company A written instructions for submitting a preliminary non-binding indication of interest to acquire or merge with Unified, including a submission deadline of September 12, 2016.

On August 10, 2016, the Unified board held a meeting that was also attended by certain members of management. At the meeting members of management presented, among other things, details of the strategic plan and a discussion ensued. Members of the special committee updated the board on the progress regarding a review of potential alternatives to the strategic plan and indicated that a full report would be provided at the next meeting. The Unified board then ratified the resolutions creating the special committee and setting forth its mandate.

Over the course of the next several weeks, SVU and Company A reviewed diligence materials made available to them and also each participated in a diligence meeting with members of Unified management.

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During this time, the special committee held weekly meetings and received updates on the in-person meetings that had occurred with representatives of SVU and Company A and discussed the need for each of SVU and Company A to provide clarity as to how they would ensure Unified members and customers would have a reliable and sustainable low-cost source of supply following any potential transaction and the process generally.

In early September 2016, the chief executive officer of Company B called Mr. Ling regarding Company B’s interest in a potential acquisition of Unified.

On September 6, 2016, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. At the meeting Mr. Ling updated the special committee regarding his discussion with Company B. The special committee discussed whether Unified should engage with Company B and determined not to engage with Company B at this time in view of the special committee’s prior assessment that Unified’s member base would be more compatible with SVU assuming SVU was prepared to pay an attractive price.

On September 12 and 13, 2016, Moelis received a written preliminary indication of interest from SVU and an oral indication of interest from Company A that had been delivered to representatives of Moelis from representatives of Company A. On September 13, 2016, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis to review the indications of interest. The indications of interest were based on enterprise values for Unified that provided no or de minimis consideration to the shareholders of Unified and otherwise were not on terms that would be acceptable to the special committee. The special committee engaged in extensive discussions regarding whether to continue the process to explore a sale in light of the disappointing initial proposals. The special committee instructed Moelis to express disappointment regarding the indications of interest and inform SVU and Company A that Unified would not be willing to pursue a transaction at the proposed valuations. The special committee also instructed Moelis to give each of the bidders an opportunity to improve their bids and to invite Company B into the process to determine whether the additional competition could result in values that would be attractive to Unified.

Company B subsequently confirmed that it would be interested in exploring the potential acquisition of Unified and on September 19, 2016, Unified entered into a confidentiality agreement with Company B.

On September 20, 2016, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. The special committee determined to recommend to the Unified board that the process continue for an additional 30 days to let SVU and Company A increase their proposed valuations and to allow Company B to submit an initial indication of interest.

On September 21, 2016, the Unified board held a meeting that was also attended by certain members of management and a representative of S&C. At the meeting members of the special committee updated the board on the process and reviewed the written indication of interest from SVU and the oral indication of interest from Company A. Following further discussion, the Unified board authorized the special committee to move forward in soliciting further proposals.

On September 30, after discussions with members of management, at the direction of the special committee and Unified board, representatives of Moelis sent Company B instructions regarding the procedures for submitting a non-binding indication of interest, including a submission deadline of October 17, 2016. Moelis also requested that SVU submit a revised non-binding indication of interest by such date. Following additional discussions between representatives of Moelis and Company A, during which Company A declined to increase its previously provided verbal indication and expressed no interest in continuing in the sale process, discussions between representatives of Unified and Company A ceased.

Over the course of the next several weeks, SVU and Company B continued to review diligence materials regarding Unified and representatives of Company B participated in a diligence meeting with members of

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Unified management. During this time, the special committee held weekly meetings and received updates regarding the diligence process as well as the level of engagement exhibited by the respective bidders, including that Company A was no longer actively engaged in the process and was not expected to submit an updated bid.

On October 17, 2016, Moelis received a written non-binding indication of interest from Company B, proposing to acquire Unified for an enterprise value of approximately $375 million (or a price per Class A Share and Class B Share, after estimated Unified transaction expenses, estimated to be $101.32). The indication of interest provided for an all cash acquisition, with no financing contingency and included the assumption of Unified’s pension liabilities.

On October 24, 2016, Moelis received a revised written non-binding indication of interest from SVU that contemplated a purchase price at closing equal to Unified’s net debt plus up to an additional $75 million in payments to certain members who entered into new long-term supply agreements and based on additional factors, including certain retailer support payments and rebates following the second and third anniversary of closing based on purchase volumes. The revised indication of interest also stated that supply agreements with members and customers representing at least two-thirds of Unified’s current volume would be a condition to closing and requested a 45 day exclusivity period with an automatic 15-day extension if SVU was proceeding in good faith.

On October 25, 2016, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. After discussion of the two proposals, the special committed instructed Moelis to (i) inform SVU that it would need to increase the value of its offer to Unified’s shareholders and eliminate the payments to customers proposed in the revised indication of interest and (ii) seek a higher value from Company B than that proposed in its indication of interest.

On October 31, 2016, Moelis received a revised written non-binding indication of interest from SVU which contemplated a purchase price equal to Unified’s net debt at closing plus $100 million (or a price per Class A Share and Class B Share, after estimated Unified transaction expenses, estimated to be $151.17) in cash at closing. The revised indication of interest also stated that long-term supply agreements with members and customers representing at least three-quarters of Unified’s current volume would be a condition to closing and requested a 45-day exclusivity period with an automatic 15-day extension if SVU was proceeding in good faith.

On November 1, 2016, Moelis received a further revised written non-binding indication of interest from Company B, indicating a willingness to acquire Unified for an enterprise value of approximately $395 million (or a price per Class A Share and Class B Share, after estimated Unified transaction expenses, estimated to be $138.84) and requesting a 60-day exclusivity period to complete diligence and negotiate definitive documentation.

Following receipt of SVU’s revised non-binding indication of interest, Mr. Ling contacted Mr. Gross to indicate that SVU’s current offer was not acceptable in light of the condition related to new supply agreements.

On November 9, 2016, Moelis received a further revised written non-binding indication of interest from SVU which proposed a purchase price equal to Unified’s net debt plus $90 million in cash at closing (or a price per Class A Share and Class B Share, after estimated Unified transaction expenses, estimated to be $132.41) and a potential payment of up to $16 million in customer-support payments to Unified members and customers who enter into supply agreements.

On November 10, 2016, Moelis received a further revised written non-binding indication of interest from Company B, indicating a willingness to acquire Unified for an enterprise value of approximately $415 million (or a price per Class A Share and Class B Share, after estimated Unified transaction expenses, estimated to be $176.37) and requesting a 60-day exclusivity period to complete diligence and negotiate definitive documentation. As with prior indications of interest received from Company B, the letter specified that, among other things, the offer was conditioned on execution of a purchase agreement containing customary representations, warranties and indemnities.

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From November 1, 2016, through November 11, 2016, the special committee held four meetings that were also attended by certain members of management and representatives of S&C and Moelis to discuss and compare the indications of interest received from SVU and Company B. The discussions involved, among other things, the valuations implied by the latest proposals, ways to push each bidder to their best and final offer, SVU’s insistence on a closing condition related to supply agreements, the fiduciary duties of the Unified board and other legal considerations in evaluating the two proposals, the potential grant of exclusivity and how the proposals compared to Unified’s standalone strategic plan. At its meeting on November 11, 2016, the special committee determined to grant a 45-day exclusivity period with a possible 15-day extension to Company B and to recommend proceeding towards a transaction with Company B to the Unified board.

On November 14, 2016, Unified entered into an exclusivity agreement with Company B, pursuant to which Unified would cease any negotiations with other parties regarding a potential transaction for a period of 45-days subject to a potential 15-day extension if Company B reaffirmed its price and was proceeding in good faith.

On November 17, 2016, the Unified board held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. A representative of S&C discussed the directors’ fiduciary duties in connection with a potential sale of Unified. Mr. Ling then updated the Unified board on the process with SVU and Company B and provided a detailed comparison of the two final indications of interest received. Mr. Ling compared the proposals to the strategic plan and discussed the risks inherent in the strategic plan, including the significant investment required to achieve the strategic plan and the challenging industry environment. Representatives of Moelis reviewed the process to solicit the proposals to date and the financial aspects of each of the proposals received from SVU and Company B. The Unified board discussed the grant of exclusivity to Company B and agreed to reconvene following completion of Company B’s diligence process and negotiations of the definitive agreement for a transaction.

Over the course of the next several weeks, Company B conducted extensive due diligence on Unified and members of management and representatives of S&C and Moelis engaged in numerous discussions and negotiations regarding definitive documentation for a proposed transaction. During this time, the special committee continued to hold regular meetings with members of management and representatives of S&C and Moelis, so that the special committee could continue to monitor and direct management and Unified’s advisors in connection with the process.

On December 6, 2016, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. Representatives of S&C and management discussed a draft merger agreement prepared by S&C at the direction of the special committee, noting, among other things, that the draft was styled as a public company transaction and did not provide for any post-closing purchase price adjustment, indemnity escrow or survival of representations and warranties.

On December 7, 2016, the Unified board held a meeting at which members of the special committee updated the Unified board on the diligence process with Company B, the reverse diligence being conducted by Unified on Company B to assess its ability to ensure an ongoing source of low cost supply to Unified’s members, and the anticipated timeline for a transaction with Company B.

On December 9, 2016, S&C distributed a draft of the merger agreement to Company B.

At the end of the 45-day exclusivity period, which expired on December 28, 2016, the special committee determined not to agree to the written extension of exclusivity requested by Company B based upon the time it was taking Company B to reach agreement on the remaining open issues in the proposed merger agreement and to complete the diligence process.

On January 1, 2017, Mr. Gross contacted Mr. Ling regarding SVU’s continued interest in acquiring Unified. Mr. Ling indicated that any further offer should be communicated in writing.

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During the month of January, Company B continued its diligence and negotiations with respect to the merger agreement and affirmed its purchase price of $415 million (or a price per Class A Share and Class B Share, after estimated Unified transaction expenses, estimated to be $176.37 to be paid to shareholders at closing).

During the weekend of January 28, 2017, the chief executive officer of another grocery wholesale company, whom we refer to as Company C, contacted Mr. Ling regarding a potential shared services arrangement that could potentially help reduce operating costs and support Unified’s achievement of its strategic plan.

On January 30, 2017, Unified received an increased written non-binding indication of interest from SVU that proposed a purchase price per Class A Share and Class B Share of $200.27. The revised indication of interest also indicated SVU’s willingness to pay a reverse termination fee of $8 million if the transaction fails to close because regulatory approval is not obtained.

On January 31, 2017, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. A representative of Moelis discussed the status of the negotiations with Company B and compared the latest proposals from Company B and the revised indication of interest recently received from SVU. The special committee discussed the delays in concluding the process with Company B, the risks and benefits of re-engaging with SVU, including that Company B had completed substantially all of its diligence, and where additional clarity was needed to adequately compare SVU’s latest proposal to that of Company B. The special committee directed Moelis to further engage with SVU, including by requesting feedback on a draft merger agreement and once again granting SVU access to the electronic data room.

On February 1, 2017, Unified received a further revised written non-binding indication of interest from SVU which again proposed a purchase price per Class A Share and Class B Share of $200.27 and confirmed that would be the net amount payable per Class A and Class B Share at closing. The revised indication of interest also indicated SVU’s acceptance of a public-style merger agreement without any indemnity and requested a 30-day exclusivity period and that Unified agree to reimburse SVU’s out-of-pocket expenses up to $2 million, payable if Unified terminates discussions with SVU or executes an agreement to be acquired by a third party.

On February 2, 2017, the Unified board held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. Mr. Ling updated the Unified board on the process with Company B and with respect to the remaining open negotiation points. Mr. Ling also updated the Unified board regarding the revised indications of interest received from SVU. Mr. Ling emphasized the negotiations with both bidders were focused on providing shareholders with maximum value, certainty regarding value and closing, and assurances of a continued low-cost source of supply and services for members. Representatives of Moelis compared certain financial aspects of the proposals and summarized the substantially increased value being offered to shareholders compared to prior proposals. Members of management updated the Unified board regarding progress on the strategic plan and the Unified board engaged in extensive discussions regarding the risks associated with full achievement of the strategic plan, including the significant industry headwinds. Mr. Ling also updated the Unified board regarding the inbound contact he received from Company C regarding a potential shared services arrangement. Following extensive discussion, the Unified board instructed management and the special committee to continue progressing negotiations with both SVU and Company B and not to engage with Company C.

On February 3, 2017, S&C provided a revised draft merger agreement to Company B and provided a substantially similar draft to SVU and representatives of Faegre Baker Daniels LLP, legal counsel to SVU, whom we refer to as FaegreBD.

On February 3, 2017, at Unified’s direction, Moelis indicated to representatives of SVU that Unified was not willing to grant exclusivity or to provide any expense reimbursement and that the next steps in the process would depend on SVU’s response to the proposed merger agreement.

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On February 7, 2017, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis to discuss the status of the process with each of SVU and Company B.

On February 8, 2017, representatives of FaegreBD sent S&C an issues list outlining the business issues presented by the draft merger agreement. Among other things, the issues list indicated that the amount of the termination fees, the potential for expense reimbursement, the circumstances under which such fees or expenses would be payable, certain regulatory matters and the parameters for certain post-closing continuation of products and services, including whether members would be required to sign supply agreements to receive the benefit of the covenant, remained to be negotiated.

On February 14, 2017, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. Representatives of S&C and Moelis updated the special committee on their respective interactions with representatives of Company B and SVU. A representative of Moelis indicated that, pursuant to management’s direction, they had requested that Company B prepare to present to the Unified board in early March and that open issues with respect to the merger agreement should be resolved before such meeting. The special committee emphasized the need for each potential bidder to adhere to the given timeline and resolve open issues before presenting to the Unified board and that no exclusivity would be granted prior to such presentation to the Unified board.

On February 15 and 16, 2017, SVU again requested that Unified agree to reimburse SVU’s expenses notwithstanding that Unified was not willing to grant exclusivity, and the parties engaged in negotiations regarding the appropriate cap if Unified was to agree to this request.

On February 17, 2017, after obtaining feedback and guidance from management and the special committee, representatives of S&C and Moelis discussed open issues with respect to the proposed merger agreement with Company B’s advisors.

In order to keep SVU engaged in the process on the proposed timeline, and based on the terms proposed in its indication of interest and the issues list relating to the proposed merger agreement, on February 19, 2017, Unified and SVU entered into an expense reimbursement agreement, pursuant to which, absent entry into the merger agreement, Unified would be required to reimburse SVU for up to $1 million of its reasonable out-of-pocket expenses if Unified entered into an agreement to be acquired by a third-party within 12 months of the date of the agreement.

During the week of February 20, 2017, representatives of SVU met with members of Unified management as part of their ongoing diligence process and participated in selected site visits of Unified properties.

On February 21, 2017, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. Representatives of Moelis and S&C updated the special committee on interactions with representatives of SVU and SVU management. The special committee was also briefed on meetings between SVU and members of Unified management scheduled over the course of the week. A representative of S&C updated the special committee on discussions with Company B and certain issues raised by its latest markup of the merger agreement and the respective position of each bidder with respect to regulatory matters. The special committee discussed the continuing need for feedback on certain employee matters from both bidders.

On February 22, 2017, the chief executive officer of Company B informed Mr. Ling that Company B would not be in a position to complete the negotiations with respect to a transaction between the parties for at least 60 days, but that Company B was still interested in pursuing a potential transaction with Unified.

On February 24, 2017, the Unified board held a meeting that was also attended by certain members of management and representatives of S&C. Mr. Ling updated the Unified board regarding Company B and the

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status of the negotiations with SVU, including the intention that a transaction with SVU would be fully negotiated prior to inviting the chief executive officer of SVU to address the Unified board. The Unified board engaged in discussions regarding, among other things, the impact of ongoing negotiations on Unified’s business and the implementation of the strategic plan, the timeline for a proposed transaction and whether a transaction with SVU is the best path for ensuring a strong, stable source of supply for the Unified members. The board instructed management to continue negotiations with SVU and to plan a future board meeting where the chief executive officer of SVU would explain SVU’s vision and answer questions posed by members of the Unified board.

On February 28, 2017, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. Members of management and representatives of S&C and Moelis updated the special committee on their discussions with SVU and its advisors, and on the status of Company B.

On March 7, 2017, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. The special committee was briefed regarding SVU’s ongoing due diligence, including quality of earnings analyses on Unified’s financial statements, as well as diligence calls that had taken place between various subject matter experts of SVU and Unified. The special committee also received a report from Unified management on Unified’s ongoing reverse due diligence on SVU.

Negotiations with respect to the draft of the merger agreement proceeded, with FaegreBD circulating a revised draft to S&C on March 9, 2017 and members of Unified management and representatives of S&C discussing FaegreBD’s markup on March 10, 2017.

On March 14, 2017, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. Christine Neal, executive vice president, chief financial officer and treasurer of Unified, and a representative of S&C detailed the issues raised by FaegreBD’s markup of the merger agreement, including, among other things, SVU’s concerns regarding credit support once there were no longer Shares to support members’ obligations. The special committee discussed in detail the need to appropriately set member expectations regarding credit support and post-closing supply arrangements. Ms. Neal led a discussion regarding the assumptions underlying the strategic plan forecasts that had been developed in connection with approval of the strategic plan as compared to the risk-adjusted financial forecasts prepared by management to reflect management’s reasonable best estimates and assumptions with respect to Unified’s future financial performance, which we refer to as the risk-adjusted forecasts. For a more detailed discussion of the risk-adjusted forecasts, please see below under the caption “—Certain Unaudited Unified Forecasts”. The meeting attendees engaged in a detailed discussion regarding the assumptions and risks associated with the strategic plan, including the fact that it had relied on members to increase their purchases from Unified, its implementation had been delayed, there were substantial industry headwinds, there was a need for significant capital investment in Unified’s distribution network and how these and other matters were taken into account in the risk-adjusted forecasts.

On March 16, 2017, the Unified board held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. Prior to the meeting, the Unified board was furnished with the risk-adjusted forecasts and materials regarding the preliminary financial analyses performed by Moelis. At the meeting, Mr. Mark Gross, chief executive officer of SVU, along with certain members of SVU’s executive team, presented an overview of SVU, including, among other things, regarding SVU’s scale, the breadth of its retail product and service offerings, the tenure and purchase volume of selected customers as well as SVU’s focus on helping its independent retail customers meet diverse local needs. Mr. Gross also discussed the intention to maintain customer-facing associate positions, post-transaction credit requirements and pricing commitments. After the SVU team left the meeting, the Unified board discussed the presentation in detail and authorized management to finalize negotiations with SVU.

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On March 17, 2017, Mr. Ling and Mr. Gross discussed the presentation by representatives of SVU to the Unified board and agreed on a proposed timeline for executing definitive documentation.

On March 18, 2017, S&C circulated a revised draft of the merger agreement to FaegreBD.

On March 21, 2017, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. A representative of S&C discussed the renewed request by SVU for exclusivity in connection with their efforts to obtain representation and warranty insurance. The special committee agreed that exclusivity would be granted orally, assuming that SVU confirmed its price. Members of management and representatives of S&C and Moelis updated the special committee on the status of SVU’s diligence process, SVU’s request to meet with certain Unified customers/members and open negotiation issues and post-closing member credit support requirements.

Later on March 21, 2017, a representative of S&C confirmed to FaegreBD that Unified was engaged in exclusive discussions with SVU.

On March 22, 2017, FaegreBD circulated a draft of the form of voting agreement to S&C. S&C circulated comments back the following day.

On March 23, 2017, FaegreBD circulated a revised draft of the merger agreement to S&C. The revised draft continued to provide for Unified members to sign a supply commitment in order to obtain the protections of the covenant regarding post-closing continuation of products and services.

On March 25, 2017, S&C circulated a revised draft of the merger agreement to FaegreBD.

On March 28, 2017, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. Ms. Neal updated the special committee on the proposal with respect to certain post-closing member credit support requirements. The special committee received an update on the status of the remaining open issues.

From March 29, 2017 through March 31, 2017, S&C and FaegreBD continued to negotiate the key terms of the proposed merger agreement and circulate revised drafts. During these negotiations, SVU dropped the request that members enter into supply agreements to receive the benefit of the covenant regarding post-closing continuation of products and services, but the parties agreed to certain additional parameters regarding purchase level and credit requirements.

On March 30, 2017, the Unified board held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. At the meeting, representatives of Moelis and S&C provided an update to the Unified board on the state of the documentation and the process of finalizing outstanding items with representatives of SVU and FaegreBD. A representative of S&C reviewed the terms of the proposed merger agreement, including, among other things, the fixed per share price, the covenant of SVU to continue providing certain products and services to the members, the conditions to closing, the deal protection measures, and the termination rights and fees and the circumstances under which such fees may become payable. A representative of S&C also summarized the terms of the voting agreements that SVU had requested each director enter into with SVU. Ms. Neal next reviewed the risk-adjusted forecasts. The Unified board discussed the assumptions in the risk adjusted forecasts. The Unified board approved the use of the risk-adjusted forecasts for use in connection with Moelis’ financial analyses and fairness opinion. Representatives of Moelis reviewed with the Unified board Moelis’ preliminary financial analyses of the merger consideration per Class A Share and Class B Share, including, among other things, the implied transaction value, an illustrative real estate analysis, a selected public companies analysis, a selected precedent transactions analysis and a discounted cash flow analysis. The chairman of the compensation committee of the Unified board discussed the treatment of Unified’s benefit plans in the merger agreement and the Unified board approved the committee’s recommendation with respect thereto. The members of the Unified board engaged in an extensive discussion regarding the proposed

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transaction, including, among other things, the preliminary financial analyses undertaken by Moelis, the indications of interest received throughout the process, the terms of the proposed final documentation and the belief that the proposed transaction provided more certainty of execution than the execution of the strategic plan.

Over the course of the next several days, members of Unified management and representatives of S&C worked with representatives of SVU and FaegreBD to finalize the merger agreement, disclosure schedules and the other definitive transaction documentation. These discussions were primarily focused on resolving final points on the interim operating covenants and resolving diligence questions based on review of the disclosure schedules.

On April 4, 2017, the special committee held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. At the meeting, members of management and representatives of S&C and Moelis updated the special committee on the status of the resolution of the remaining issues and the anticipated timeline to signing the merger agreement.

On the morning of April 10, 2017, the Unified board held a meeting that was also attended by certain members of management and representatives of S&C and Moelis. Representatives of S&C reviewed the terms of the proposed merger agreement, including certain changes to the interim operating covenant, the post-closing employee protections and the treatment of certain Shares held by members in default of their payment obligations to Unified. Representatives of S&C noted that there had not been other material changes to the merger agreement since the March 30 meeting. Representatives of Moelis reviewed with the Unified board Moelis’ financial analyses of the merger consideration per Class A Share and Class B Share and rendered to the Unified board an oral opinion, which was subsequently confirmed by delivery of a written opinion dated April 10, 2017 that, as of the date of the opinion and based upon and subject to the conditions and limitations set forth in the opinion, the merger consideration per Class A Share and Class B Share to be received by the holders of Unified Class A Shares and Class B Shares in the merger was fair from a financial point of view to such holders, other than Excluded Holders (as defined in such written opinion). For a more detailed discussion of Moelis’ opinion, please see below under the caption “—Opinion of Moelis & Company LLC”. Such opinion is attached to this proxy statement as Annex D. The Unified board then engaged in discussions regarding the proposed transaction, including, among other things, the process for communicating about the transaction with associates, members and key constituents and the timeline to closing. Following consideration of the merger agreement and the transactions contemplated by the merger agreement, the Unified board, among other things, unanimously (i) approved, authorized and declared that the merger agreement and the merger and the other transactions contemplated by the merger agreement are fair to, and in the best interests of, Unified and its shareholders, (ii) declared that it is in the best interests of Unified and its shareholders that Unified enter into the merger agreement and consummate the transactions contemplated thereby on the terms and subject to the conditions set forth in the merger agreement, (iii) approved the voting agreements, and (iv) recommended, subject to Section 5.2 of the merger agreement, that the shareholders approve the merger and the merger agreement.

Thereafter on April 10, 2017, SVU, Merger Sub and Unified executed the merger agreement, SVU entered into the voting agreements with the shareholders party thereto, and Unified, SVU and Mr. Ling entered into the non-competition agreement and the letter agreement. Unified and SVU subsequently issued a joint press release later that day announcing the execution of the merger agreement.

Reasons for the Merger; Recommendation of the Board of Directors

The Unified board unanimously recommends that you vote “FOR” the proposal to approve the merger agreement.

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In reaching its decision to approve and recommend the approval of the merger and the merger agreement, the Unified board consulted with Unified’s management, as well as its financial and legal advisors, and considered a number of factors, including the following material factors:

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The Unified board also considered a variety of potentially negative reasons in its deliberations concerning the merger agreement and the merger, including the following (not in any relative order of importance):

The foregoing discussion of the information and reasons considered by the Unified board is not intended to be exhaustive, but includes the material reasons considered by the Unified board. In view of the variety of reasons considered in connection with its evaluation of the merger, the Unified board did not find it practicable to, and did not, quantify or otherwise assign relative weights to the specific reasons considered in reaching its

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determination and recommendation. In addition, individual directors may have given different weights to different reasons. The Unified board did not undertake to make any specific determination as to whether any reason, or any particular aspect of any reason, supported or did not support its ultimate determination. The Unified board based its recommendation on the totality of the information presented. After considering these reasons, the Unified board concluded that the positive reasons related to the merger agreement and the transactions contemplated thereby substantially outweighed the potential negative reasons.

Portions of this explanation of the reasons for the merger and other information presented in this section are forward-looking in nature and, therefore, should be read in light of “Cautionary Statement Regarding Forward-Looking Statements”.

Opinion of Moelis & Company LLC

At the meeting of the Unified board on April 10, 2017 to evaluate and approve the merger, Moelis delivered an oral opinion, which was confirmed by delivery of a written opinion, dated April 10, 2017, addressed to the Unified board to the effect that, as of the date of the opinion and based upon and subject to the conditions and limitations set forth in the opinion, the merger consideration per Class A Share and Class B Share to be received by holders of the Class A Shares and the Class B Shares in the merger is fair from a financial point of view to such holders, other than the excluded holders.

The full text of Moelis’ written opinion dated April 10, 2017, which sets forth the assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Annex D to this proxy statement and is incorporated herein by reference. Shareholders are urged to read Moelis’ written opinion carefully and in its entirety. Moelis’ opinion was provided for the use and benefit of the Unified board (solely in its capacity as such) in its evaluation of the merger. Moelis’ opinion is limited solely to the fairness, from a financial point of view, of the merger consideration per Class A Share and Class B Share to the holders of the Class A Shares and Class B Shares, other than the excluded holders, and does not address Unified’s underlying business decision to effect the merger or the relative merits of the merger as compared to any alternative business strategies or transactions that might be available with respect to Unified. Moelis’ opinion does not constitute a recommendation to any shareholder of Unified as to how such shareholder should vote or act with respect to the merger or any other matter. Moelis’ opinion was approved by a Moelis fairness opinion committee.

In arriving at its opinion, Moelis, among other things:

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In connection with its review, Moelis did not assume any responsibility for independent verification of any of the information supplied to, discussed with or reviewed by Moelis for the purpose of its opinion and has, with the consent of the Unified board, relied on such information being complete and accurate in all material respects. With the consent of the Unified board, Moelis relied upon, without independent verification, the assessment of Unified and its legal, tax, regulatory and accounting advisors with respect to legal, tax, regulatory and accounting matters. With respect to the financial forecasts referred to above, Moelis assumed, at the direction of the Unified board, that such financial information was reasonably prepared on a basis reflecting the best currently available estimates and judgments of the management of Unified as to the future performance of Unified. Moelis expresses no views as to the reasonableness of any financial forecasts or the assumptions on which they are based. Moelis’ opinion is based on the risk-adjusted forecasts and Moelis expressed no opinion under any other set of forecasts, including the strategic plan. In addition, with the consent of the Unified board, Moelis did not make any independent evaluation or appraisal of any of the assets or liabilities (contingent, derivative, off-balance-sheet, or otherwise) of Unified, nor was Moelis furnished with any such evaluation or appraisal (other than the real estate appraisals).

Moelis’ opinion did not address Unified’s underlying business decision to effect the merger or the relative merits of the merger as compared to any alternative business strategies or transactions that might be available to Unified and does not address any legal, regulatory, tax or accounting matters. At the direction of the Unified board, Moelis was not asked to, nor did it, offer any opinion as to any terms of the merger agreement or any aspect or implication of the merger, except for the fairness of the merger consideration per Class A Share and Class B Share from a financial point of view to the holders of the Class A Shares and Class B Shares (other than the excluded holders). In rendering its opinion, Moelis assumed, with the consent of the Unified board, that the treatment of the Class A Shares and Class B Shares in the merger is identical notwithstanding any differences between the two classes of shares set forth in Unified’s organizational documents. In rendering its opinion, Moelis assumed, with the consent of the Unified board, that the final executed form of the merger agreement would not differ in any material respect from the draft that Moelis reviewed, that the merger would be consummated in accordance with its terms and that the parties to the merger agreement would comply with all the material terms of the merger agreement. In rendering its opinion, Moelis assumed, with the consent of the Unified board, that all governmental, regulatory or other consents or approvals necessary for the completion of the merger will be obtained, except to the extent that could not be material to Moelis’ analysis.

Moelis’ opinion was necessarily based on economic, monetary, market and other conditions as in effect on, and the information made available to Moelis as of, the date of the opinion, and Moelis assumed no responsibility to update the opinion for developments after the date thereof.

The opinion did not constitute a recommendation as to how any holder of securities should vote or act with respect to the merger or any other matter. The opinion did not address the fairness of the merger or any aspect or implication thereof to, or any other consideration of or relating to, the holders of any class of securities, creditors or other constituencies of Unified, other than the fairness of the merger consideration per Class A Share and Class B Share from a financial point of view to the holders of the Class A Shares and Class B Shares (other than the excluded holders). In addition, Moelis did not express any opinion as to the fairness of the amount or nature of any compensation to be received by any officers, directors or employees of any parties to the merger, or any class of such persons, relative to the merger consideration per Class A Share and Class B Share or otherwise.

The following is a summary of the material financial analyses presented by Moelis to the Unified board at its meeting held on April 10, 2017, in connection with its opinion.

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Some of the summaries of financial analyses below include information presented in tabular format. In order to fully understand Moelis’ analyses, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the analyses. Considering the data described below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of Moelis’ analyses.

Financial Analyses of Unified

Selected Public Companies Analysis.

Moelis reviewed financial and stock market information of selected publicly traded companies that share certain business characteristics with Unified’s two business divisions, (i) conventional wholesale and (ii) specialty distribution. Moelis reviewed among other things, enterprise values of the selected companies (calculated as market value of the relevant company’s diluted common equity based on closing stock prices on April 5, 2017, plus, as of the relevant company’s most recently reported quarter end, preferred stock, short-term and long-term debt, less cash and cash equivalents, plus book value of non-controlling interests) as a multiple, to the extent information was publicly available of EBITDA (defined as earnings before interest, taxes, depreciation, amortization, LIFO expense, stock-based compensation expense and non-recurring items, where applicable) for the last twelve months as of the most recently reported quarter end (“LTM EBITDA”) and for the estimated calendar year 2017 (“CY 2017E EBITDA”). Financial data for the selected companies was based on publicly available consensus research analysts’ estimates, public filings and other publicly available information. The selected public companies used in this analysis and their implied enterprise value to EBITDA multiples are summarized below:

Food Wholesalers

Food Retailers

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The selected public company analysis derived a range of enterprise and equity values for Unified using a “sum-of-the-parts” methodology that (i) applied ranges of indicative multiples to the EBITDA (pre-corporate & IT costs) of Unified’s conventional wholesale and specialty distribution businesses to derive enterprise values for each business, (ii) deducted the impact of corporate & IT costs at a blended EBITDA multiple based on the weighted average EBITDA contribution of each of Unified’s businesses and the indicative multiple ranges used for each business, (iii) deducted the impact of imputed rent as if Unified’s owned real estate was leased from a third party, based on an assumed rent per Unified management equal to 7% of the fair market value of such owned real estate per the real estate appraisals, and applying a blended EBITDA multiple to such imputed rent based on the indicative multiple ranges and (iv) added the fair market value of Unified’s owned real estate based on the real estate appraisals (less estimated taxes after giving effect to certain tax assets and transaction expenses as estimated by Unified management). From this derived range of enterprise values, Moelis then deducted (i) Unified’s “normalized” net debt of $284 million, calculated by Unified management as the monthly average closing net debt balance for the twelve months ended December 31, 2016, to approximate a level of debt consistent with a normalized level of net working capital, given significant fluctuations in Unified’s net debt and working capital period-to-period, (ii) customer deposits of $16 million as of December 31, 2016, including excess deposits, required deposits and credit deposits and (iii) the merger consideration to be paid to holders of Class E Shares and estimated amounts payable pursuant to the LTIP, to derive a range of implied equity values to the Class A and Class B Shares. These derived equity values were then divided by Unified’s Class A Shares and Class B Shares outstanding to derive a per Class A Share and Class B Share reference range.

Based on the selected companies that are denoted above as Food Wholesalers—Conventional Wholesale, Moelis used an indicative multiple range of 4.5x and 6.5x LTM EBITDA and 5.0x and 6.5x 2017E EBITDA, respectively, for purposes of deriving implied enterprise values for Unified’s conventional wholesale business. Based on the selected company that is denoted above as Food Wholesalers—Specialty Distribution, Moelis used an indicative multiple range of 8.0x and 10.0x LTM EBITDA and 7.0x and 9.0x 2017E EBITDA, respectively, for purposes of deriving implied enterprise values for Unified’s specialty distribution business. In addition, Moelis considered that the mean and median multiples for the selected companies that are denoted above as Food Retailers—Conventional Supermarkets were 7.1x and 6.9x LTM EBITDA and 6.9x and 6.7x CY 2017E EBITDA, respectively, and that the mean and median multiples for the selected companies that are denoted above as Food Retailers—Specialty Grocers were 8.5x and 7.8x LTM EBITDA and 8.1x and 7.8x CY 2017E EBITDA, respectively. However, Moelis noted that the analysis viewed the trading multiples of the selected food retailers as less relevant to Unified than the selected food wholesalers, in part because Unified has no retail operations.

Moelis used the indicative multiple ranges described above to conduct the sum-of-the-parts analysis as summarized in the table below. Financial data for Unified was based on the risk-adjusted forecasts, the real estate appraisals and other information and data provided by Unified’s management.

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Selected Public Companies Analysis: Sum-of-Parts Based on LTM EBITDA

Moelis used the same sum-of-parts methodology as described above to derive a per Class A Share and Class B Share reference range based on Unified’s 2017E EBITDA, by applying the indicative multiple ranges described above for CY 2017E. The selected public companies analysis indicated the following implied per Class A Share and Class B Share reference ranges, as compared to the merger consideration per Class A Share and Class B Share:

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Selected Precedent Transactions Analysis.

Moelis reviewed financial information of selected transactions involving (i) conventional food wholesalers since 2013, (ii) retail supermarket chains announced since 2011 that Moelis believed reflected similar industry dynamics as the food wholesaling industry and (iii) specialty food distributors announced since 2009, but noted that limited financial information was publicly disclosed for these transactions. Moelis reviewed, among other things, transaction values of the selected precedent transactions as a multiple, to the extent information was publicly available, of LTM EBITDA of the target company. Financial data for the relevant transactions was based on publicly available information at the time of announcement of the relevant transaction. The selected precedent transactions used in this analysis and their implied transaction value to LTM EBITDA multiples are summarized below:

Moelis observed that the mean and median LTM EBITDA multiples for the selected transactions that are denoted as Conventional Wholesale and Retail Supermarkets were 6.8x and 6.9x, respectively, with a range from approximately 4.0x to 9.0x. For the selected transactions that are denoted as Specialty Food Distribution, the multiples ranged from approximately 9.0x to 11.0x.

Moelis then used the same sum-of-the-parts methodology described in the selected public companies analysis, applying indicative multiple ranges derived from the selected precedent transactions for purposes of

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deriving enterprise values for Unified’s conventional wholesale and specialty distribution businesses. Based on the selected precedent transactions denoted above as Conventional Wholesale and Retail Supermarkets, Moelis used an indicative multiple range of 6.0x to 8.0x LTM EBITDA for purposes of deriving implied enterprise values for Unified’s conventional wholesale business, and 9.0x to 11.0x LTM EBITDA for purposes of deriving implied enterprise values for Unified’s specialty distribution business, as summarized in the table below. Financial data for Unified was based on the real estate appraisals and other information and data provided by Unified’s management.

Selected Precedent Transactions Analysis: Sum-of-Parts

This analysis indicated the following implied per Class A Share and Class B Share reference range for Unified, as compared to the merger consideration per Class A Share and Class B Share:

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Discounted Cash Flow Analysis

Moelis performed a discounted cash flow, which we refer to as DCF, analysis of Unified to calculate the present value of the estimated future unlevered free cash flows projected to be generated by Unified per the risk-adjusted forecasts, which included the estimated net proceeds from the sale of Unified’s real estate based on the real estate appraisals (less estimated taxes after giving effect to certain tax assets and transaction expenses as estimated by Unified management). Moelis utilized a range of discount rates of 9.5% to 11.0%, based on an estimated range of Unified’s weighted average cost of capital, which we refer to as WACC, to calculate estimated present values as of December 31, 2016 of (i) Unified’s estimated after-tax unlevered free cash flows for the fiscal quarter ended March 31, 2017 through the fiscal quarter ended December 31, 2020, and (ii) estimated terminal values derived by applying a range of perpetuity growth rates of 1.0% to 2.0% to Unified’s terminal unlevered free cash flow projection. Terminal free cash flow was calculated by Unified management to reflect “normalized” levels for changes in net working capital (assumed to be $0) and changes in other assets / liabilities (assumed to be (~$5) million). Financial data for Unified was based on the risk-adjusted forecasts and other information and data provided by Unified’s management. This analysis indicated the following implied per Class A Share and Class B Share reference range for Unified, as compared to the merger consideration per Class A Share and Class B Share:

Other Information

For reference purposes for the Unified board only, and not as part of Moelis’ financial analysis considered with respect to its opinion, Moelis performed a DCF analysis of Unified to calculate the present value of the estimated future unlevered free cash flows projected to be generated by Unified based on projections prepared by Unified management that assumed the full achievement of the strategic plan as the strategic plan had been updated as of February 2017, which also included the estimated net proceeds from the sale of Unified’s real estate based on the real estate appraisals (less estimated taxes after giving effect to certain tax assets and transaction expenses as estimated by Unified management). Moelis utilized the same range of discount rates based on WACC as described above to calculate estimated present values as of December 31, 2016 of (i) Unified’s estimated after-tax unlevered free cash flows for the fiscal quarter ended March 31, 2017 through the fiscal quarter ended December 31, 2020, and (ii) estimated terminal values derived by applying a range of perpetuity growth rates of 1.0% to 2.0% to Unified’s terminal unlevered free cash flow projection based on full achievement of the strategic plan as the strategic plan had been updated as of February 2017 and normalized as described above, and other information and data provided by Unified’s management. For reference purposes only, this analysis indicated an implied per Class A Share and Class B Share reference range for Unified of approximately $320 to $550 per Class A Share and Class B Share as compared to the merger consideration per Class A Share and Class B Share of $200.27. Moelis noted that the entire valuation range derived by the DCF analysis based on the projections prepared by Unified management that assume full achievement of the strategic plan as the strategic plan had been updated as of February 2017 is in excess of the merger consideration per Class A Share and Class B Share.

Miscellaneous

This summary of the analyses is not a complete description of Moelis’ opinion or the analyses underlying, and factors considered in connection with, Moelis’ opinion. The preparation of a fairness opinion is a complex analytical process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or summary set forth above, without considering the analyses as a whole, could create an incomplete view of the processes underlying Moelis’ opinion. In arriving at its fairness determination, Moelis considered the results of all of its analyses and did not attribute any particular weight to any factor or analysis. Rather, Moelis made its fairness determination on the basis of its experience and professional judgment after considering the results of all of its analyses.

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No company or transaction used in the analyses described above is identical to Unified or the merger. In addition, such analyses do not purport to be appraisals, nor do they necessarily reflect the prices at which businesses or securities actually may be sold. Analyses based upon forecasts of future results are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by such analyses. Because the analyses described above are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the parties or their respective advisors, neither Unified, nor Moelis or any other person assumes responsibility if future results are materially different from those forecast.

The merger consideration per Class A Share and Class B Share was determined through arms’ length negotiations between Unified and SVU and was approved by the Unified board. Moelis did not recommend any specific consideration to Unified or the Unified board, or that any specific amount or type of consideration constituted the only appropriate consideration for the merger.

Moelis acted as financial advisor to Unified in connection with the merger and will receive a fee for its services, currently estimated to be approximately $5.7 million in the aggregate, $1 million of which became payable in connection with the delivery of its opinion, regardless of the conclusion reached therein, $250,000 of which was paid prior to the delivery of the opinion, and the remainder of which is contingent upon completion of the merger. In addition, Unified has agreed to indemnify Moelis for certain liabilities, including liabilities under the federal securities laws, arising out of its engagement.

Moelis’ affiliates, employees, officers and partners may at any time own securities (long or short) of SVU. Moelis provided investment banking and other services to Unified and in the future may provide such services to SVU and has received and may receive compensation for such services. In the past two years prior to the date of the opinion, Moelis acted as financial advisor to Unified in a strategic evaluation of Unified, which engagement led to Moelis’ subsequent engagement by Unified to act as financial advisor in connection with the merger.

The Unified board engaged Moelis because Moelis is an internationally recognized investment banking, financial advisory and securities firm whose senior professionals have substantial experience advising companies in, among other industries, the food retail and distribution sector. Moelis is regularly engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, strategic transactions, corporate restructurings, and valuations for corporate and other purposes.

Certain Unaudited Unified Forecasts

Unified does not as a matter of course publicly disclose forecasts or projections, due to, among other reasons, the uncertainty of the underlying assumptions and estimates. However, Unified is including in this proxy statement certain forecasts, which we refer to as the strategic plan forecasts, prepared by management for the Unified board in the first half of calendar 2016 and updated in February 2017 as part of its ongoing strategic planning process. The strategic plan was premised upon Unified continuing to operate as a standalone company and was designed to provide a framework for the operation of the business in a manner that could meet the objectives of Unified’s members in the face of increased industry competition and deliver a long-term, sustainable, low cost supply source for Unified’s members. Underlying the strategic plan was data indicating the opportunity for Unified to grow sales by driving sales with existing members of products they were currently selling but, for a variety of reasons, purchasing elsewhere. The strategic plan also took into account the need for significant capital investment to modernize Unified’s distribution network and support the growth contemplated by the strategic plan along with the need to delever Unified’s balance sheet. The strategic plan forecasts were included in the confidential information memorandum made available to the potential buyers, including SVU. As the Unified board continued to explore its alternatives, it continued to discuss and update the strategic plan and the strategic plan forecasts based on, among other things, challenges in implementing the strategic plan, preliminary feedback from Unified’s members and members of the Unified board and trends in Unified’s business and industry, as well as further analysis of the assumptions underlying the forecasts by the broader Unified management team. Given the significant risks noted by management with respect to fully achieving the

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strategic plan, as part of the evolution of the strategic plan throughout 2016, the Board requested that management also consider projections under alternative scenarios whereby the strategic plan was not fully achieved. In March 2017, the Unified board approved forecasts, which we refer to as the risk-adjusted forecasts, that were prepared by management to reflect management’s best currently available estimates and judgments with respect to Unified’s future financial performance in light of the risks to fully achieving the strategic plan. At the direction of the Unified board, Moelis reviewed certain information relating to the business, earnings, cash flow, assets, liabilities and prospects of Unified furnished to Moelis by Unified, including the risk-adjusted forecasts, in connection with the rendering of its fairness opinion to the Unified board and performing its related financial analyses, as described in “—Opinion of Moelis & Company LLC”.

The strategic plan forecasts assumed full achievement of the strategic plan before adjusting for the noted risks. Significant assumptions underlying the strategic plan forecasts included, among other things:

After the strategic plan was approved, Unified formed a team to implement the strategic plan, and the strategic plan forecasts continued to be updated based, among other things, on (i) recent real estate appraisals, (ii) preliminary member feedback and (iii) updated information on cost estimates in the Pacific Northwest. Preliminary feedback from certain members indicated that certain members were reluctant to change their purchasing habits to shift more purchases from other vendors to Unified, competitive forces were inhibiting growth of smaller members and new members had not been emerging as they had in the past. The risk-adjusted forecasts reflect these considerations as well as a further shift of expected increased sales to customers other than existing members, challenges in implementing the full strategic plan and continued industry headwinds. While achievement of the risk-adjusted forecasts would enable Unified to achieve some of its deleveraging goals and to continue to repurchase Class E Shares, these goals would be achieved at lower levels than in connection with achievement of the strategic plan forecasts. Significant assumptions underlying the risk-adjusted forecasts based on the considerations described above, included, among other things:

The summaries of the strategic plan forecasts and the risk-adjusted forecasts are not included in this proxy statement to induce any shareholder of Unified to vote in favor of the approval of the merger agreement or any other proposals to be voted on at the special meeting, but because the strategic plan forecasts were made available to the Unified board, Moelis and SVU and the risk-adjusted forecasts were made available to the Unified board and Moelis. The inclusion of these forecasts should not be regarded as an indication that Unified, the Unified board, Moelis or SVU considered, or now considers, these forecasts to be a reliable prediction of future results or to support or fail to support your decision whether to vote for or against the merger proposal. No person has made or makes any representation or warranty regarding the information included in these forecasts.

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While these forecasts were prepared in good faith by management, no assurance can be made regarding future events. These forecasts also reflect assumptions as of the time of their respective preparation as to certain business decisions that are subject to change. Although presented with numerical specificity, these forecasts are based upon a variety of estimates and numerous assumptions made by management with respect to, among other matters, incremental sales growth, operational cost savings, efficiencies in connection with rationalizing Unified’s distribution centers, general business, economic, regulatory, market and financial conditions and other matters, including the factors described in “Cautionary Statement Regarding Forward-Looking Statements”, many of which are difficult to predict, are subject to significant economic and competitive uncertainties, and are beyond Unified’s control. These forecasts also assume that Unified would continue to operate as a standalone company and do not reflect any impact of the merger. In addition, because these forecasts cover multiple years, such information by its nature becomes less reliable with each successive year. As a result, there can be no assurance that the estimates and assumptions made in preparing these forecasts will prove accurate, that the projected results will be realized or that actual results will not be significantly higher or lower than projected results. These forecasts cannot, therefore, be considered a guaranty of future operating results, and this information should not be relied on as such.

These forecasts were not prepared with a view toward public disclosure, soliciting proxies or complying with U.S. Generally Accepted Accounting Principles, which we refer to as GAAP, the published guidelines of the SEC regarding financial projections and forecasts or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of financial projections and forecasts. Neither Unified’s independent registered public accounting firm nor any other independent registered public accounting firm has examined, compiled or otherwise performed any procedures with respect to the prospective financial information contained in these forecasts and, accordingly, neither Unified’s independent registered public accounting firm nor any other independent registered public accounting firm has expressed any opinion or given any other form of assurance on such information or its achievability, and assumes no responsibility for, and disclaims any association with, the prospective financial information.

Certain of the measures included in these forecasts may be considered non-GAAP financial measures, including adjusted EBITDA. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and non-GAAP financial measures as used by Unified may not be comparable to similarly titled amounts used by other companies. These non-GAAP measures are included because, in the case of strategic plan forecasts, they were supplied to SVU and the other bidders and, in the case of the risk-adjusted forecasts, they were used by Moelis in connection with its fairness opinion to the Unified board and performing its related financial analyses, as described in “—Opinion of Moelis & Company LLC”.

Strategic Plan Forecasts

The following table summarizes Unified’s unaudited prospective financial information for the fiscal years ending October 1, 2017 through 2020 furnished to SVU in August of 2016 as part of the strategic plan forecasts.

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Risk-Adjusted Forecasts

The following table summarizes Unified’s unaudited prospective financial information for the years ending October 1, 2017 through 2020 furnished to Moelis in March 2017 as part of the risk-adjusted forecasts in connection with its fairness opinion to the Unified board. The risk-adjusted forecasts were not provided to SVU or any of the other bidders.