Edgar Filing: FOODARAMA SUPERMARKETS INC

SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

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FOODARAMA SUPERMARKETS, INC.
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(Name of Registrant as Specified In Its Charter)

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FOODARAMA SUPERMARKETS, INC.

922 Highway 33

Building 6, Suite 1

Howell, New Jersey 07731

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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held on Wednesday, April 13, 2005
----------------------------

The Annual Meeting of Shareholders (the "Annual Meeting") of Foodarama
Supermarkets, Inc. (the "Company") will be held at the offices of the Company,
922 Highway 33, Building 6, Suite 1, Howell, New Jersey 07731, on Wednesday,
April 13, 2005 at 2:00 p.m. (local time), for the following purposes:

1. To elect five (5) nominees for director who will serve on the Board of
Directors of the Company for the following year and until their successors have
been elected and qualify; and

2. To transact such other business as may properly come before the Annual
Meeting and any postponement or adjournment thereof.

The Board of Directors has fixed the close of business on February 18,
2005 as the record date (the "Record Date") for determining the shareholders
entitled to notice of and to vote at the Annual Meeting or any postponement or
adjournment thereof. A list of shareholders as of the Record Date will be
available for inspection by shareholders at the Annual Meeting.

YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. SHAREHOLDERS WHO
DO NOT EXPECT TO ATTEND THE ANNUAL MEETING ARE REQUESTED TO COMPLETE AND RETURN
THE ENCLOSED PROXY CARD IN THE ENCLOSED ENVELOPE, WHICH DOES NOT REQUIRE
ADDITIONAL POSTAGE IF MAILED IN THE UNITED STATES. THIS WILL NOT PREVENT YOU
FROM VOTING IN PERSON IF YOU WILL BE PRESENT AT THE ANNUAL MEETING.

By Order of the Board of Directors,

/s/ Joseph J. Saker, Jr.

Howell, New Jersey Joseph J. Saker, Jr.
February 25, 2005 Secretary

FOODARAMA SUPERMARKETS, INC.

922 Highway 33

Building 6, Suite 1

Howell, New Jersey 07731

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PROXY STATEMENT
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GENERAL INFORMATION

This Proxy Statement and the accompanying form of proxy are being mailed
to the shareholders of Foodarama Supermarkets, Inc. ("Foodarama" or the
"Company") in connection with the solicitation, by and on behalf of the
management of the Company, of proxies to be voted at the Annual Meeting of
Shareholders (the "Annual Meeting") to be held at the offices of the Company,
922 Highway 33, Building 6, Suite 1, Howell, New Jersey, on Wednesday, April 13,
2005 at 2:00 p.m. (local time) and at all postponements or adjournments thereof.

The securities entitled to vote at the Annual Meeting consist of shares of
Common Stock, $1.00 par value ("Common Stock"), of the Company with each share
of Common Stock entitling its owner to one vote on an equal basis. The number of
outstanding shares of Common Stock on February 18, 2005 was 987,617. Only
shareholders of record on the books of the Company at the close of business on
that date will be entitled to vote at the Annual Meeting. The holders of a
majority of the outstanding shares of Common Stock, present in person or by
proxy and entitled to vote, will constitute a quorum at the Annual Meeting.

At the Annual Meeting, shareholders of the Company will consider and vote
upon the election of five (5) nominees for director who will serve on the Board
of Directors (the "Board" or the "Board of Directors") of the Company and any
other business as may properly come before the Annual Meeting. The affirmative
vote of a plurality of the shares of Common Stock present in person or
represented by proxy and entitled to vote is required for the election of
directors. The proxy card provides space for a shareholder to withhold votes for
any or all nominees for director. All votes will be tabulated by the inspector
of election appointed for the Annual Meeting who will separately tabulate
affirmative votes, authority withheld for any nominee for director and any
abstentions or broker non-votes. Authority withheld will be counted toward the
tabulation of total votes cast in the election of directors and will have the
same effect as a negative vote. Any proxy submitted and containing an abstention
or a broker non-vote is not counted as a vote cast on any matter to which it
relates and will only be counted for purposes of determining whether a quorum is
present at the Annual Meeting.

All shares of Common Stock represented by properly executed proxies will
be voted at the Annual Meeting, unless such proxies have previously been
revoked. Unless otherwise instructed, the shares of Common Stock represented by
such proxies will be voted "FOR" the election of management's nominees for
director. Management does not know of any other matter to be brought before the
Annual Meeting, but it is intended that, as to any such other matter, votes may
be cast pursuant to the proxies in accordance with the judgment of the person or
persons acting thereunder unless otherwise directed by the shareholders.

The Company's mailing address is 922 Highway 33, Building 6, Suite 1,
Freehold, New Jersey 07728 and its telephone number is (732) 462-4700. The
notice, proxy statement and enclosed form of proxy are being mailed to
shareholders on or about February 28, 2005.

Any shareholder who executes and delivers a proxy may revoke it at any
time prior to its use by (a) delivering written notice of such revocation to the
Secretary of the Company at its offices; (b) delivering to the Secretary of the
Company a duly executed proxy bearing a later date; or (c) appearing at the
Annual Meeting and requesting the return of his or her proxy.

YOU ARE REQUESTED TO COMPLETE AND SIGN THE ACCOMPANYING PROXY AND RETURN
IT PROMPTLY IN THE ENVELOPE PROVIDED FOR THAT PURPOSE.

PROXY STATEMENT

PRINCIPAL SHAREHOLDERS

The following table shows, as of February 18, 2005, the persons known to
the Company who owned directly or beneficially more than five percent (5%) of
the outstanding Common Stock of the Company:

Amount Percent
Name of Beneficial Owner Beneficially Owned of Class
--------------------------------------------------------------------------------
Joseph J. Saker (1) (2) (3) ................... 228,975 22.4
Saker Family Corporation (1) (4) .............. 85,000 8.6
Richard J. Saker (1) (3) (4) (5) .............. 236,803 23.1
Joseph J. Saker, Jr. (1) (4) (6) .............. 118,095 12.0
Thomas A. Saker (1) (4) ....................... 125,041 12.7
Dimensional Fund Advisors, Inc. (7) ........... 64,750 6.6
Arthur N. Abbey (8) ........................... 118,400 12.0
Trellus Management Company, LLC (9) ........... 51,300 5.2

(1) The address of the foregoing person is c/o Foodarama Supermarkets, Inc.,
922 Highway 33, Building 6, Suite 1, Freehold, New Jersey 07728.

(2) Includes 13,378 shares held by the wife of Joseph J. Saker. Mr. Saker
disclaims beneficial ownership of the shares held by his wife.

(3) Includes 35,000 shares subject to currently exercisable options or options
exercisable within sixty (60) days of February 18, 2005 granted pursuant
to the Company's 2001 Stock Incentive Plan (the "Stock Incentive Plan").

(4) Includes 85,000 shares held by the Joseph Saker Family Partnership, L.P.,
a Delaware limited partnership (the "Partnership"). The Saker Family
Corporation is the sole general partner (the "General Partner") of the
Partnership. Richard J. Saker owns 40% of the outstanding capital stock of
the General Partner, and each of Joseph J. Saker, Jr. and Thomas A. Saker
owns 30% of the outstanding capital stock of the General Partner. The
General Partner owns a 1% interest in the Partnership and has the sole
power to sell, transfer or otherwise dispose of the shares of the
Company's Common Stock only upon the unanimous consent of all shareholders
of the General Partner. On other matters not involving the sale, transfer
or other disposition of such shares, the shares of the Company's Common
Stock held by the Partnership are voted as directed by the individual
shareholders of the General Partner in accordance with their respective
ownership interests in the General Partner. Accordingly, the General
Partner votes 34,000 shares as directed by Richard J. Saker, 25,500 shares
as directed by Joseph J. Saker, Jr., and 25,500 shares as directed by
Thomas A. Saker on such other matters.

In addition to their ownership interests in the General Partner, Richard
J. Saker, Joseph J. Saker, Jr. and Thomas A. Saker are the beneficiaries
of the trust which owns a 99% interest in the Partnership (the "Limited
Partner"). Thus, each of Richard J. Saker, Joseph J. Saker, Jr. and Thomas
A. Saker also has an indirect interest in the Company's Common Stock held
by the Partnership by reason of their respective beneficial interests in
the Limited Partner. Their beneficial interests in the Limited Partner are
in identical proportion to their ownership interests in the General
Partner. Richard J. Saker, Joseph J. Saker, Jr. and Thomas A. Saker each
disclaim beneficial ownership of shares held by the Partnership in excess
of their respective pecuniary interests.

(5) Includes 1,760 shares held by Richard J. Saker's wife and 1,377 shares
which are held in a trust for Mr. Saker's son, of which Mr. Saker is the
trustee. Mr. Saker disclaims beneficial ownership of the shares described
in the preceding sentence.

(6) Includes 2,754 shares which are held in two trusts for the benefit of Mr.
Saker's sons, of which Mr. Saker is the trustee. Mr. Saker disclaims
beneficial ownership of the shares described in the preceding sentence.

(7) The address of Dimensional Fund Advisors, Inc. ("Dimensional") is 1299
Ocean Avenue, 11th Floor, Santa Monica, California 90401. Dimensional, an
investment advisor registered under Section 203 of the Investment Advisors
Act of 1940, furnishes investment advice to four investment companies
registered under the Investment Company Act of 1940, and serves as
investment manager for certain other investment vehicles, including
commingled group trusts. These investment companies and investment
vehicles are referred to collectively herein as the "Portfolios." In its
role as investment advisor and investment manager, Dimensional possesses
both voting and investment power over 64,750 shares of the Company's
Common Stock based upon a copy of Schedule 13G filed with the Securities
and Exchange Commission ("SEC") on February 9, 2005. The Portfolios own
all securities reported in the table, and Dimensional disclaims beneficial
ownership of such securities.

(8) The address of Arthur N. Abbey is 212 East 39th Street, New York, New York
10016. Based upon a copy of Schedule 13D filed with the SEC on November
13, 2003, Mr. Abbey has sole voting power with respect to these shares.

(9) The address of Trellus Management Company, LLC ("Trellus") is 350 Madison
Avenue, 9th Floor, New York, New York 10017. Trellus is a Delaware limited
liability company and is a Delaware registered investment advisor to
domestic and offshore hedge funds. Adam Usdan is President of Trellus.
Based upon a copy of Schedule 13G filed with the SEC on February 7, 2005,
Adam Usdan and Trellus have shared voting power with respect to these
shares.

FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES

SECURITIES OWNED BY MANAGEMENT

The following table sets forth certain information regarding beneficial
ownership of the Company's Common Stock as of February 18, 2005 by (i) each
director and nominee for director of the Company, (ii) the executive officers of
the Company on such date, and (iii) the executive officers, nominees for
director and directors as a group. Except as set forth in the footnotes to this
table, the shareholders have sole voting and investment power over such shares.

Amount Percent
Name of Beneficial Owner Beneficially Owned of Class
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Joseph J. Saker (1) (2) (3) ...................................... 228,975 22.4
Richard J. Saker (1) (2) (4) (5) ................................. 236,803 23.1
Joseph J. Saker, Jr. (1) (4) (6) ................................. 118,095 12.0
Charles T. Parton (1) (7) ........................................ 3,400 *
Albert A. Zager (1) (7) .......................................... 2,500 *
Robert H. Hutchins (1) (8) ....................................... 1,000 *
Michael Shapiro (1) (8) (9) ...................................... 1,000 *
Emory A. Altobelli (1) (10) ...................................... 775 *
Carl L. Montanaro (1) (8) ........................................ 515 *
Robert V. Spires (1) (7) ......................................... 1,000 *
Joseph C. Troilo (1) ............................................. -- *
Directors, Nominees for Director and Executive Officers as a Group
(11 persons) (2) (3) (5) (6) (7) (8) (9) (10) (11) (12) (13) .... 594,063 55.9

(*) Less than one percent.

(1) The address of the foregoing person is c/o Foodarama Supermarkets, Inc.,
922 Highway 33, Building 6, Suite 1, Freehold, New Jersey 07728.

(2) Includes 35,000 shares subject to currently exercisable options or options
exercisable within sixty (60) days of February 18, 2005 granted pursuant
to the Stock Incentive Plan.

(3) Includes 13,378 shares held by the wife of Joseph J. Saker. Mr. Saker
disclaims beneficial ownership of the shares held by his wife.

(4) Includes 85,000 shares held by the Joseph Saker Family Partnership, L.P.,
a Delaware limited partnership (the "Partnership"). The Saker Family
Corporation is the sole general partner (the "General Partner") of the
Partnership. Richard J. Saker owns 40% of the outstanding capital stock of
the General Partner, and each of Joseph J. Saker, Jr. and Thomas A. Saker,
Vice President--Store Operations of the Company, owns 30% of the
outstanding capital stock of the General Partner. The General Partner owns
a 1% interest in the Partnership and has the sole power to sell, transfer
or otherwise dispose of the shares of the Company's Common Stock only upon
the unanimous consent of all shareholders of the General Partner. On other
matters not involving the sale, transfer or other disposition of such
shares, the shares of the Company's Common Stock held by the Partnership
are voted as directed by the individual shareholders of the General
Partner in accordance with their respective ownership interests in the
General Partner. Accordingly, the General Partner votes 34,000 shares as
directed by Richard J. Saker, 25,500 shares as directed by Joseph J.
Saker, Jr. and 25,500 shares as directed by Thomas A. Saker on such other
matters.

In addition to their respective ownership interests in the General
Partner, Richard J. Saker, Joseph J. Saker, Jr. and Thomas A. Saker are
beneficiaries of the trust which owns a 99% interest in the Partnership
(the "Limited Partner"). Thus, each of Richard J. Saker, Joseph J. Saker,
Jr. and Thomas A. Saker also has an indirect interest in the Company's
Common Stock held by the Partnership by reason of their respective
beneficial interests in the Limited Partner. Their beneficial interests in
the Limited Partner are in identical proportion to their ownership
interests in the General Partner. Richard J. Saker, Joseph J. Saker, Jr.
and Thomas A. Saker each disclaim beneficial ownership of shares held by
the Partnership in excess of their respective pecuniary interests. See
Note (4) to the table captioned "Principal Shareholders."

(5) Includes 1,760 shares held by Richard J. Saker's wife and 1,377 shares
which are held in a trust for the benefit of Mr. Saker's son, of which Mr.
Saker is the trustee. Mr. Saker disclaims beneficial ownership of the
shares described in the preceding sentence.

(6) Includes 2,754 shares which are held in two trusts for the benefit of Mr.
Saker's sons, of which trusts Mr. Saker is the trustee. Mr. Saker
disclaims beneficial ownership of the shares described in the preceding
sentence.

(7) Includes 1,000 shares subject to currently exercisable options or options
exercisable within sixty (60) days of February 18, 2005 granted pursuant
to the Stock Incentive Plan.

(8) Includes 500 shares subject to currently exercisable options or options
exercisable within sixty (60) days of February 18, 2005 granted pursuant
to the Stock Incentive Plan.

(9) Includes 500 shares owned jointly with Mr. Shapiro's wife.

(10) Includes 750 shares subject to currently exercisable options or options
exercisable within sixty (60) days of February 18, 2005 granted pursuant
to the Stock Incentive Plan.

(11) Of the 594,063 shares, directors of the Company own or have rights to
acquire 472,678 shares.

(12) Includes 85,000 shares held by the Joseph Saker Family Partnership, L.P.,
the total number of which shares is also included both in the total number
of shares attributed to ownership by Richard J. Saker, and the total
number of shares attributed to ownership by Joseph J. Saker, Jr.

(13) Includes shares subject to currently exercisable options or options
exercisable within sixty (60) days of February 18, 2005 granted pursuant
to the Stock Incentive Plan and held by the directors and executive
officers as described above.

PROXY STATEMENT

The Company's Third Amended and Restated Revolving Credit and Term Loan
Agreement provides that an event of default shall occur if Messrs. Joseph J.
Saker and Richard J. Saker together, do not own, beneficially, all voting rights
with respect to at least 25% of all of the issued and outstanding Common Stock
of the Company.

NOMINEES AS A DIRECTOR OF THE COMPANY

The By-laws of the Company provide that the number of directors shall be a
minimum of three (3) and a maximum of eleven (11), and permit the exact number
of directors to be determined from time to time by the Board. Currently, the
Board has fixed the number of directors at five (5).

Nomination Process

The Company does not have a standing nominating committee or a nominating
committee charter. Instead it chooses to rely on the expertise of its
independent directors, Charles T. Parton, Albert A. Zager and Robert H.
Hutchins, who consider the criteria set forth below, to propose nominees for
director and the judgment of the Board in determining the nominees for election.
The independent directors of the Board currently meet the standards for
independence as set forth in the rules of the American Stock Exchange, the
exchange on which the Company's Common Stock is traded. The nominees named
herein were unanimously proposed and recommended for approval by the full Board
by the following independent directors of the Company, Charles T. Parton, Albert
A. Zager and Robert H. Hutchins.

The members of the Board as a whole believe that, at a minimum, the Board
should be comprised of directors who have expertise that may be useful to the
Company as well as directors who have in the past exhibited the highest personal
and professional ethics. When considering nominees for director, the independent
directors consider several factors, including (i) relevant business experience;
(ii) independence from management; (iii) judgment, skill, integrity and
reputation; (iv) existing commitments and potential conflicts of interest; (v)
financial and accounting background; and (vi) the size and composition of the
existing Board. Because the nominees named below are all sitting directors of
the Company who are up for re-election at the Annual Meeting, the independent
directors also considered each director's past performance on the Board. The
Board seeks to identify individuals who satisfy these criteria from among
persons known to them.

The independent directors of the Board will also consider nominees for
director suggested by shareholders of the Company. The process by which a
shareholder of the Company may suggest a nominee for director of the Company can
be found under "Shareholder Proposals and Nominees for Director." The
independent directors will apply the same criteria described above to any
candidate suggested by a shareholder as well as evaluate any additional
information required to be submitted therewith. The Company does not pay any
fees to third parties to identify, evaluate or assist in identifying or
evaluating potential nominees.

Nominees

It is the intention of the persons named in the accompanying proxy to
vote, unless otherwise instructed, in favor of the election of the five (5)
nominees for director named herein, each for a term expiring at the annual
meeting in 2006 or until such time as his successor has been duly elected and
qualifies. If for any reason any of the said nominees should be unable or
unwilling to serve, which is not now anticipated, the proxies will be voted for
a substitute nominee(s) who will be designated by the Board.

The following table sets forth certain information relating to the
individuals nominated by the Board to serve as a director of the Company:

Year First
Elected a
Name and Age Principal Occupation Director
-----------------------------------------------------------------------------------------------------------------------

Joseph J. Saker (76) ....... Chairman of the Board of the Company 1958
Richard J. Saker (53) ...... President and Chief Executive Officer of the Company 1987
Charles T. Parton (63) ..... Chairman of the Board--Two River Community Bank, a commercial bank 1995
Albert A. Zager (56) ....... Shareholder--Zager, Fuchs, Ambrose & Krantz, P.C., Attorneys at Law 1995
Robert H. Hutchins (53) .... President and Managing Director--Hutchins, Farrell, Meyer & Allison, P.A.,
Certified Public Accountants 2001

Mr. Joseph J. Saker served as President of the Company from its
incorporation in 1958 until October 3, 2000 and as Chief Executive Officer of
the Company from its incorporation until November 1, 2003. Mr. Saker has served
as Chairman since 1971. Joseph J. Saker is the father of Richard J. Saker,
President and Chief Executive Officer of the Company, Joseph J. Saker, Jr.,
Senior Vice President--Marketing and Advertising and Secretary of the Company
and Thomas A. Saker, a Vice President--Store Operations of the Company.

FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES

Mr. Richard J. Saker, a graduate of St. Joseph's University, has been
employed by the Company since 1969 and served as Senior Vice
President-Operations from 1984 until 1995, at which time he assumed the position
of Executive Vice President--Operations. On October 3, 2000, he was elected
President of the Company. On November 2, 2003, Mr. Saker was elected by the
Board to assume the position of Chief Executive Officer of the Company, a
position formerly held by Joseph J. Saker. He is a member of the Board of
Directors of Wakefern Food Corporation ("Wakefern"), a retailer-owned food
distribution corporation which provides purchasing, warehousing and distribution
services to the Company as well as other shareholder members, and a member of
its Finance Committee.

Mr. Parton is Chairman of the Board of Two River Community Bank (the
"Bank") and has served in that position since May 1, 2000. Prior to assuming
that position, he served as President and Chief Executive Officer of the Bank
from February 1, 2000 to April 30, 2000. In addition, on March 1, 1999, Mr.
Parton began serving and continues to serve as a managing member of TRB, LLC, a
financial holding company formed in connection with the incorporation of the
Bank. He has been a financial executive, consultant and Certified Financial
Planner for the last ten years and is Executive Vice President and Treasurer of
The Parton Corporation. He is also a Director of Kuehne Chemical Co., Inc.
(chlorine and caustic soda products).

Mr. Zager is a shareholder of Zager, Fuchs, Ambrose & Krantz, P.C.,
Attorneys at Law. He was a member of Carton, Arvanitis, McGreevy, Argeris, Zager
& Aikins, L.L.C. Attorneys at Law and its predecessors from 1977 until 2004,
having served as the Chairman of its Executive and Management Committees. He is
President of the Board of Directors of the Center for Holocaust Studies of
Brookdale Community College, a founding member of the Board of Directors of the
Eastern Monmouth Area Chamber of Commerce Educational Foundation, Inc., and
outside General Counsel for Meridian Health System, Inc.

Mr. Hutchins, CPA, has been the President and Managing Director of
Hutchins, Farrell, Meyer & Allison, P.A., a certified public accounting firm,
since he founded the firm in 1984. In addition, Mr. Hutchins has been active in
community affairs. He is a founder and Chairman of the Board of Trustees of
Ocean Housing Alliance, Inc., and has served as an elected Board Member of the
Toms River Regional School District and as an appointed member of the Ocean
County Mental Health Advisory Board. He is past Chairman of the American Cancer
Society-Ocean Unit, Co-chairperson of the American Cancer Society Eastern Region
Excalibur and a member of the National American Cancer Society Excalibur
Advisory Committee.

CORPORATE GOVERNANCE

The Company currently has a Code of Conduct (the "Code") which is
applicable to all directors, officers and employees of the Company, including
the Company's principal executive and senior financial officers. The Code
requires, among other things, that all directors, officers and employees of the
Company avoid conflicts of interest, comply with all laws and legal requirements
and otherwise conduct business in an honest and ethical manner. A copy of the
Code was filed as an exhibit to the Company's Annual Report on Form 10-K for the
fiscal year ended November 1, 2003.

DIRECTORS MEETINGS AND COMMITTEES

The Company held eight (8) meetings of its Board, including four (4)
telephonic meetings, during the fiscal year ended October 30, 2004. In addition,
the Board acted by Unanimous Written Consent on four (4) occasions. No incumbent
director attended fewer than 75% of the total number of meetings held by the
Board and Committees of the Board on which he served, other than Joseph J. Saker
who attended 50%.

Board Committees

The Board has appointed Audit and Stock Option Committees. The Company
does not have a compensation committee of the Board. Instead, the full Board
acts on matters of compensation. The Audit and Stock Option Committees each
consist of Messrs. Parton, Zager and Hutchins. During the fiscal year ended
October 30, 2004, the Audit Committee held four (4) meetings, and there were no
meetings of the Stock Option Committee.

Director Attendance at Annual Meetings

The Company encourages all of its directors to attend the Annual Meeting
and typically schedules a Board meeting to be held on the same day as the Annual
Meeting. The Company expects that all of its directors will attend the Annual
Meeting, absent a valid reason such as a scheduling conflict. Last year, all of
the directors, with the exception of Mr. Joseph Saker, attended the Annual
Meeting and the Board meeting held on the same day as the Annual Meeting.

PROXY STATEMENT

REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

Notwithstanding anything to the contrary set forth in any of the Company's
previous or future filings under the Securities Act of 1933, as amended (the
"Securities Act"), or the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), that might incorporate this Proxy Statement in future filings
with the SEC, in whole or in part, the following report shall not be deemed to
be incorporated by reference into any such filing.

Membership and Role of Audit Committee

The Audit Committee of the Board (the "Audit Committee" or the
"Committee") is comprised of the following directors: Charles T. Parton, Albert
A. Zager and Robert H. Hutchins. Each member of the Committee qualifies as an
independent director in accordance with the rules of the American Stock Exchange
("AMEX") and the rules and regulations of the SEC. In addition, the Board has
determined that Robert H. Hutchins is both independent and qualifies as a
financial expert, as defined by SEC rules. The Audit Committee operates under a
written charter previously adopted by the Board (see discussion below).

The primary function of the Committee is to provide advice with respect to
the Company's financial matters and to assist the Board in fulfilling its
oversight responsibilities regarding finance, accounting, tax and legal
compliance. The Committee's primary duties and responsibilities are to: 1) serve
as an independent and objective body to monitor the financial reporting process
and internal control system of the Company; 2) oversee the quality and integrity
of the financial statements of the Company; 3) engage an independent public
accounting firm registered with the Public Company Accounting Oversight Board
(the "independent auditors") for the Company each year; 4) review and appraise
the qualifications, performance and independence of the Company's independent
auditors; 5) review and appraise the performance of the Company's internal audit
department; 6) provide an open forum for communication among the independent
auditors, senior financial officers, other members of management, the internal
audit department and the Board; and 7) assist in assuring the Company's
compliance with legal and regulatory requirements.

Audit Committee Charter

The Audit Committee developed an Audit Committee Charter (the "Charter")
in consultation with the Company's accounting and finance department, its
internal audit department, the Company's independent auditors and outside
general counsel. The Board adopted the Charter on June 7, 2000, and the Charter
was filed with the SEC on (i) February 26, 2001 as Appendix "A" to the Company's
proxy statement delivered in connection with the 2001 Annual Meeting of
shareholders and (ii) February 27, 2004 as Appendix "A" to the Company's proxy
statement delivered in connection with the 2004 Annual Meeting of shareholders.
The Audit Committee reviews the Charter on an annual basis and updates the
Charter as necessary. On September 25, 2003 and again on January 15, 2004, the
Board adopted amendments to the Charter as recommended by the Audit Committee to
comply with the recently amended corporate governance rules of AMEX and the
rules and regulations of the SEC. The Charter filed with the SEC on February 27,
2004 reflects the September 25, 2003 and January 15, 2004 amendments.

Review of the Company's Audited Financial Statements for the Fiscal Year Ended
October 30, 2004

The Audit Committee has reviewed and discussed the audited financial
statements of the Company for the fiscal year ended October 30, 2004 with the
Company's management. The Audit Committee has discussed with Amper, Politziner &
Mattia, P.C., the Company's independent auditors, those matters required to be
discussed by Statement on Auditing Standards No. 61 (Communication with Audit
Committees). The Audit Committee also met with the Company's Disclosure
Committee, which is responsible for taking appropriate measures to assure that
the reports that the Company files with the SEC pursuant to the Exchange Act
disclose all information required to be disclosed in such reports and for
modifying the Company's disclosure controls and procedures, as necessary.

The Audit Committee has also received the written disclosures and the
letter from Amper, Politziner & Mattia, P.C. required by Independence Standards
Board Standard No. 1 (Independence Discussion with Audit Committees), and the
Audit Committee has discussed the independence of Amper, Politziner & Mattia,
P.C. with that firm. Amper, Politziner & Mattia, P.C. confirmed, in its
professional judgment, that it is not aware of any relationship between Amper,
Politziner & Mattia, P.C. and the Company that would reasonably bear on its
independence.

Based on the Audit Committee's review and discussions noted above, the
Audit Committee recommended to the Board that the Company's audited financial
statements be included in the Company's Annual Report on Form 10-K for the
fiscal year ended October 30, 2004 for filing with the SEC.

FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES

Audit Fees

The Company paid a total of $199,000 in fiscal year 2004 and $201,000 in
fiscal year 2003 to Amper, Politziner & Mattia, P.C. for audit services, which
included work related to the annual audit and quarterly reviews rendered in
fiscal years 2004 and 2003, respectively.

Audit Related Fees

The Company did not pay any audit related fees to Amper, Politziner &
Mattia, P.C. during fiscal 2004 and fiscal 2003.

Tax Fees

The Company paid a total of $39,000 in fiscal year 2004 and $45,000 in
fiscal year 2003 to Amper, Politziner & Mattia, P.C. for income tax
consultation, including income tax compliance, tax advice and tax planning.

All Other Fees

Amper, Politziner & Mattia, P.C. did not bill the Company for any other
services during fiscal years 2004 or 2003.

The Audit Committee has considered whether the non-audit services provided
by Amper, Politziner & Mattia, P.C., including the services rendered in
connection with income tax consultation, were compatible with maintaining its
independence and has determined that the nature and substance of the limited
non-audit services did not impair the status of Amper, Politziner & Mattia, P.C.
as the Company's independent auditors. None of the engagements of Amper,
Politziner & Mattia, P.C., which were pre-approved by the Audit Committee, made
use of the de minimis exception to pre-approval contained in the rules of the
SEC which permit limited engagements for non-audit services involving amounts
under a specified threshold.

Submitted by: Charles T. Parton
Albert A. Zager
Robert H. Hutchins

EXECUTIVE OFFICERS OF THE COMPANY

The executive officers of the Company are as set forth below:

Name Age Capacities in Which Served
--------------------------------------------------------------------------------------------------------------------

Joseph J. Saker (1)..................... 76 Chairman of the Board
Richard J. Saker (1).................... 53 President and Chief Executive Officer
Michael Shapiro (2)..................... 63 Senior Vice President, Chief Financial Officer and Treasurer
Emory A. Altobelli (3).................. 64 Senior Vice President--Corporate Subsidiaries and Services
Carl L. Montanaro (4)................... 63 Senior Vice President--Sales and Merchandising
Joseph J. Saker, Jr. (5)................ 44 Senior Vice President--Marketing and Advertising and Secretary
Robert V. Spires (6).................... 51 Senior Vice President--Human Resources and Labor Relations
Joseph C. Troilo (7).................... 71 Senior Vice President--Financial Administration, Assistant Secretary
and Assistant Treasurer

(1) See "Nominees as a Director of the Company."

(2) Mr. Shapiro joined the Company on August 15, 1994 as Senior Vice
President, Chief Financial Officer and Treasurer.

(3) Mr. Altobelli has served as Senior Vice President, Corporate Subsidiaries
and Services, since June 21, 1995. Prior to that date he served as Senior
Vice President, Administration, commencing in June 1990.

(4) Mr. Montanaro has served as Senior Vice President, Sales and
Merchandising, since June 21, 1995. From March 1988 to June 1995 he served
as Vice President of Sales and Merchandising.

(5) Mr. Joseph J. Saker, Jr. has served as Senior Vice President, Marketing
and Advertising since March 1, 2002 and as Secretary since April 14, 2004.
From October 2001 to February 28, 2002 he served as a Vice President of
Operations. From May 1990 to September 2001, he served as a Director of
Operations.

(6) Mr. Spires has served as Senior Vice President, Human Resources and Labor
Relations, since June 21, 1995. From August 1991 to June 1995, he served
as Vice President of Human Resources and Labor Relations.

(7) Mr. Troilo has served as Senior Vice President, Financial Administration,
since August 1994. From 1974 to August 1994, he served as Senior Vice
President, Finance.

PROXY STATEMENT

EXECUTIVE COMPENSATION

The aggregate compensation paid or accrued by the Company during the last
three fiscal years ended November 2, 2002, November 1, 2003 and October 30, 2004
to the Chief Executive Officer of the Company and to the four most highly
compensated executive officers (other than the Chief Executive Officer) whose
compensation in salary and bonus exceeded $100,000 in the last fiscal year (the
"Named Officers") is set forth in the following table:

Summary Compensation Table

Annual Compensation All Other Compensation
---------------------------- ----------------------
Name and Principal Position Year Salary Bonus (1) SERP (2) 401(k) (3)
----------------------------------------------------------------------------------------------------------------------------

Joseph J. Saker (4)................................................. 2004 $ 325,000 $ 64,189 $ 161,500 $ 4,000
Chairman 2003 413,200 57,656 161,500 4,000
2002 413,200 74,732 150,100 3,400

Richard J. Saker.................................................... 2004 557,225 108,755 401,000 4,000
President and Chief Executive Officer (5) 2003 522,650 72,476 392,000 4,000
2002 504,250 90,611 523,000 3,400

Michael Shapiro..................................................... 2004 209,898 32,805 87,200 7,104
Senior Vice President, Chief Financial Officer and Treasurer 2003 202,970 22,381 91,300 6,753
2002 203,857 28,164 102,400 6,150

Carl L. Montanaro................................................... 2004 198,912 26,431 47,900 6,717
Senior Vice President, Sales and Merchandising 2003 180,993 18,033 53,200 6,115
2002 173,758 22,692 60,200 6,006

Joseph J. Saker, Jr................................................. 2004 167,530 26,431 45,000 5,985
Senior Vice President, Marketing and Advertising and Secretary 2003 163,763 18,033 -- 5,566
2002 161,561 21,920 -- 5,856

(1) Incentive compensation paid or accrued pursuant to the Company's Incentive
Compensation Plans (the "Incentive Plans"). The Incentive Plans were
adopted by the Board for each of the fiscal years presented in the table
to attract, retain and motivate salaried employees by providing
incentive compensation awards in cash. The Board administers the Incentive
Plans, which includes designating salaried employees eligible to
participate in the Incentive Plans and awarding incentive compensation to
the eligible employees, subject to the Company achieving certain specified
levels of pre-tax profit. In administering the Incentive Plans, the Board
took into account the recommendations of the Company's executive officers,
except that determinations made with respect to the Company's Chairman of
the Board and President were made solely by the Company's independent
directors.

(2) These amounts represent the projected annual benefit at retirement as of
the end of each fiscal year for the applicable Named Officers under the
Company's Supplemental Executive Retirement Plan ("SERP"), which was
approved by the Board on January 17, 1989. Amounts payable at retirement
under the SERP range from 40% to 50% of the employee's highest average
compensation over a five-year period less primary Social Security, pension
plan benefits and 401(k) benefits and are payable until death, but for a
minimum of 120 months, except for Mr. Joseph J. Saker (See Note (4)
below). This Plan covers eight (8) executive officers and other key
employees and is intended to supplement the Company's retirement benefits.
Such amounts are not payable until the earlier of the death, disability or
retirement of the covered employee. The Company anticipates paying for
benefits as they become due out of current operating income.

The SERP provides for a pre-retirement death benefit of one-half the
amount payable upon retirement, actuarially computed, payable to the
employee's beneficiary over 120 months. If the employee dies after
retirement, such employee's beneficiary will receive the same benefit the
employee would have received if the employee had lived for 120 months. The
Company has amended the SERP for Mr. Joseph J. Saker as described in Note
(4) below. During fiscal 2004, the Company recorded $763,000 of deferred
compensation expense with respect to the SERP.

(3) Represents amounts contributed by the Company under its 401(k) Plan (the
"401(k) Plan"). The Company maintains a 401(k) Plan for all qualified
non-union employees. Employees are eligible to participate in the 401(k)
Plan after completing one (1) year of service (1,000 hours) and attaining
age 21. Employee contributions are discretionary to a maximum of 30% of
compensation but may not exceed $14,000 per year. The Company has elected
to match 25% of the employee's contributions up to 6% of employee eligible
compensation not exceeding $205,000. The Company may make additional
discretionary contributions. These discretionary contributions amounted to
2% of eligible compensation for the three calendar years ending December
31, 2004.

FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES

(4) Effective November 2, 2003, Joseph J. Saker relinquished his position as
Chief Executive Officer of the Company, but continues to serve as an
executive officer of the Company, occupying the position of Chairman of
the Board pursuant to a two (2) year employment agreement (the "Employment
Agreement") commencing November 2, 2003 and ending October 29, 2005.
Richard J. Saker was elected by the Board to assume the position of Chief
Executive Officer.

Mr. Saker's base salary under the Employment Agreement is $325,000 and
$275,000 during the first and second years, respectively, of the term of
the agreement. Mr. Saker is eligible to participate in the Company's
Incentive Plans and 401(k) Plan and is entitled to receive insurance
benefits made available to other employees of the Company during the term
of the Employment Agreement. The Company has agreed to pay for the
transportation of Mr. Saker to and from the Company's offices and store
locations.

In addition, the Employment Agreement provides certain post-retirement
benefits for Mr. Saker and his wife. Specifically, the Company has agreed
to provide fully paid medical and dental insurance coverage for Joseph
Saker and his wife during their respective lives. The Company will provide
certain supplemental life insurance for Mr. Saker post retirement and the
premiums to be paid by the Company for such insurance shall not exceed
$22,104. Also, the Company amended its SERP, as to Mr. Saker only, to
provide for payments under that plan for the joint and several lives of
Joseph Saker and his wife. Each other executive participating in the SERP
is entitled to a benefit payable for his life and, in the event of death,
his beneficiary is entitled to receive a benefit for a period of up to 120
months. See Note (2) above.

(5) The members of the Board elected Richard J. Saker to assume the position
of Chief Executive Officer of the Company effective November 2, 2003.

OPTION GRANTS AND EXERCISES DURING FISCAL YEAR ENDED OCTOBER 30, 2004

Shown below is information with respect to options exercised by the Named
Officers during the fiscal year ended October 30, 2004. The Company did not
grant any stock options in the fiscal year ended October 30, 2004.

Aggregated Option Exercises in the Fiscal Year Ended October 30, 2004
and Fiscal Year-End Option Values for the Named Officers

Total Number of Securities Value of Unexercised
Underlying Unexercised Options In-the-Money Options
Shares at October 30, 2004 at October 30, 2004 (1)
Acquired on Value ------------------------------------------------------------
Name (2) Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
------------------------------------------------------------------------------------------------------------------

Joseph J. Saker............ -- -- 30,000 10,000 $ 537,000 $ 179,000
Richard J. Saker........... -- -- 30,000 20,000 $ 537,000 $ 358,000
Michael Shapiro............ -- -- 500 -- $ 8,950 --
Carl L. Montanaro.......... 250 $ 6,038 500 -- $ 8,950 --
Joseph J. Saker, Jr........ -- -- -- -- -- --

(1) This represents the difference between the closing price of the Company's
Common Stock on October 29, 2004, the last trading day in Fiscal 2004
($37.50), and the exercise price of the options ($19.60).

(2) All stock options were granted on August 8, 2001 (the "Grant Date") in
accordance with the Stock Incentive Plan. The stock options granted to
Messrs. Joseph J. Saker and Richard J. Saker are assignable to any of
their respective children or grandchildren who are employed by the Company
at the store manager or higher level. The options granted to Mr. Richard
J. Saker, which include 30,000 shares subject to currently exercisable
options, vest quarterly from the Grant Date over a five (5) year period.
The options granted to Mr. Joseph J. Saker, which include 30,000 shares
subject to currently exercisable options, vest quarterly from the Grant
Date over a four (4) year period. All other stock options granted vested,
per individual, 250 shares on the Grant Date and 250 shares on each
anniversary of the Grant Date thereafter for the (3) three years following
the Grant Date.

PROXY STATEMENT

PENSION PLAN

The Company maintains a defined benefit pension plan for eligible
employees. Full vesting occurs after five (5) years of service. Benefits upon
retirement prior to age 65 are reduced actuarially. Benefits under the plan are
determined by a formula equal to .6% times the highest five (5) consecutive year
average of a participant's compensation from the commencement of employment
through September 30, 1997, times the total years of service at September 30,
1997. The plan also provides for lump sum payments, which are payable under
certain circumstances. The table set forth below specifies the estimated annual
benefits payable upon normal retirement at age 65. Pursuant to a resolution
adopted by the Board on September 24, 1997, years of service and benefit
accruals for participants in the plan were frozen effective September 30, 1997.
In lieu of contributions to the defined benefit pension plan for the seven (7)
calendar years ended December 31, 2004, the Board has approved contributions to
the 401(k) Plan in an amount equal to the sum of (a) two percent (2%) of the
eligible compensation of 401(k) Plan participants; and (b) $.25 for every $1.00
contributed to the 401(k) Plan by the participants for up to 6% of the
participant's eligible compensation. The Company did not make any contributions
to the 401(k) Plan prior to freezing benefit accruals under the defined benefit
pension plan.

Years of Service at September 30, 1997
--------------------------------------------------------------------------------
Remuneration 15 20 25 30 35
--------------------------------------------------------------------------------
$ 100,000 ..................... $ 7,500 $ 10,000 $ 12,500 $ 15,000 $ 17,500
125,000 ..................... 9,375 12,500 15,625 18,750 21,875
150,000 ..................... 11,250 15,000 18,750 22,500 26,250
175,000 ..................... 13,125 17,500 21,875 26,250 30,625
200,000 ..................... 15,000 20,000 25,000 30,000 35,000
225,000 ..................... 16,875 22,500 28,125 33,750 39,375
250,000 ..................... 18,750 25,000 31,250 37,500 43,750
275,000 ..................... 20,625 27,500 34,375 41,250 48,125
300,000 ..................... 22,500 30,000 37,500 45,000 52,500

For purposes of vesting benefits under the pension plan, the Company has
credited Richard J. Saker with 23 years of service; Michael Shapiro with 3 years
of service; Joseph J. Saker, Jr. with 21 years of service; and Carl L. Montanaro
with 35 years of service. The highest five (5) consecutive year average, or
pro-rated portion thereof, of compensation through September 30, 1997 for each
of the Company's Named Officers, after giving effect to applicable limitations
under the Internal Revenue Code of 1986, as amended, is as follows: Richard J.
Saker--$150,000; Michael Shapiro--$150,000, Carl L. Montanaro--$119,000, and
Joseph J. Saker, Jr.--$99,000.

Mr. Joseph J. Saker received a lump sum distribution of $403,878 in
January 1995, representing the amount of his vested interest in the pension
plan.

DIRECTORS' COMPENSATION

All non-employee directors receive, in addition to reimbursement for their
reasonable expenses associated with attendance at meetings of the Board, an
annual retainer fee of $15,000 payable quarterly in advance, and a participation
fee of $1,000 for each meeting of the Board attended. All non-employee members
of the Audit Committee receive, in addition to reimbursement for their
reasonable expenses associated with attendance at Audit Committee meetings, a
fee of $1,000 for each Audit Committee meeting attended if held on a day other
than a day on which a Board meeting is held, and a fee of $500 for each Audit
Committee meeting attended if held on the same day as a meeting of the Board.
All non-employee members of the Stock Option Committee receive, in addition to
reimbursement for their reasonable expenses associated with attendance at Stock
Option Committee meetings, a fee of $500 for each Stock Option Committee meeting
attended if held on a day other than a day on which a Board meeting is held.

The Company paid a total of $71,500 during the fiscal year ended October
30, 2004 to directors who are not employees of the Company.

FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES

COMPLIANCE WITH REPORTING REQUIREMENTS

Section 16(a) of the Exchange Act requires the Company's executive
officers and directors, and persons who own more than ten percent (10%) of a
registered class of the Company's equity securities, to file reports of
ownership and changes of ownership on Forms 3, 4 and 5 with the SEC. Executive
officers, directors and greater than ten percent (10%) shareholders are required
by SEC regulation to furnish the Company with copies of all Forms 3, 4 and 5
they file.

Based solely on the Company's review of the copies of such forms it has
received, the Company believes that, during the fiscal year ended October 30,
2004, all of its officers, directors and greater than ten percent (10%)
beneficial owners required to file reports pursuant to Section 16 (a) of the
Exchange Act complied with all filing requirements applicable to them, except
that Thomas Flynn, Vice President-Chief Accounting Officer, filed two Forms 4 in
June 2004 that were due in September 2002 in connection with his exercise of
stock performance units.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION IN
COMPENSATION DECISIONS

For the fiscal year ended October 30, 2004, the full Board performed the
functions of a board compensation committee. Executive officers who served on
the Board during fiscal 2004 were Mr. Joseph J. Saker, Chairman of the Board,
and Mr. Richard J. Saker, President and Chief Executive Officer. The Board acted
on matters of compensation for the Chairman and the Chief Executive Officer,
with each of such officers abstaining from any compensation decisions relating
specifically to them.

COMPENSATION REPORT OF THE BOARD OF DIRECTORS

The Company's independent directors are responsible for determining the
compensation of the Company's Chairman and its Chief Executive Officer. During
fiscal 2004, Joseph J. Saker served as the Company's Executive Chairman and
Richard J. Saker served as the Company's Chief Executive Officer. In order to
arrive at an appropriate level of compensation for the Company's Chief Executive
Officer for the fiscal year ended October 30, 2004, the independent directors
considered a variety of factors presented in this report.

Corporate data for chief executive officers of similar sized grocery
retailing organizations throughout the country as well as the Company's
financial performance and other achievements during the fiscal year ended
November 1, 2003 were reviewed and considered by the Company's independent
directors in determining compensation levels for the Company's Chief Executive
Officer for fiscal 2004. In addition, the independent directors took into
account the fact that the Chief Executive Officer of the Company has personally
guaranteed significant amounts of indebtedness owed by the Company to Wakefern.

After careful consideration of the various factors, including, among
others, the facts referenced above, the independent directors determined the
base salary of the Chief Executive Officer should be increased by four percent
(4%) for the fiscal year ended October 30, 2004. See "Executive
Compensation--Summary Compensation Table."

As of the end of the 2003 fiscal year, Joseph J. Saker relinquished his
role as Chief Executive Officer of the Company. Recognizing the substantial
contribution that Mr. Saker has made and is expected to continue to make to the
growth, development and successful operation of the Company, including his
personal guaranty of the Company's indebtedness to Wakefern, the Board
determined that it was in the best interests of the Company and its shareholders
that Joseph Saker's judgment and experience remain available to the Company and
that he continue to serve as an executive officer of the Company occupying the
position of Chairman of the Board. The Board approved a two (2) year employment
agreement between the Company and Joseph J. Saker beginning November 2, 2003.
See Note (4) to the Summary Compensation Table.

The members of the Board elected Richard J. Saker to assume the position
of Chief Executive Officer of the Company based upon his substantial experience
in supermarket operations, his long tenure as an executive officer of the
Company and his substantial contribution to the growth and development of the
Company.

Historically, the Company's Chief Executive Officer makes determinations
with respect to cash compensation paid to other executive officers of the
Company. In addition to considering market comparisons, salaries paid to
executive officers are based on the executive's level of responsibility,
experience in his role, and the overall performance and condition of the Company
and the economy at large.

PROXY STATEMENT

The Company's Board is responsible for administration of the Company's
2004 Incentive Compensation Plan (the "Incentive Compensation Plan"). Pursuant
to the Incentive Compensation Plan, the Company has undertaken to pay incentive
compensation to designated employees if it achieved certain adjusted pre-tax
profit levels. The terms of the Incentive Compensation Plan are generally
consistent with the terms of incentive compensation plans adopted and approved
by the Company for prior fiscal years. Pursuant to the Incentive Compensation
Plan, the Board awarded cash incentive compensation to certain salaried
employees of the Company, including Mr. Joseph J. Saker and Mr. Richard J.
Saker. See "Executive Compensation--Summary Compensation Table."

The Stock Option Committee of the Board, which consists of its outside
directors, administers the Company's Stock Incentive Plan. The Stock Incentive
Plan enables the Company to grant stock-based and other forms of incentives,
including stock options, stock appreciation rights, phantom stock, and
restricted stock, among others. The Stock Option Committee may select from among
these types of awards, and may combine different types of awards within
individual grants, to establish individual grants affording long-term
incentives, for the purpose of better aligning the interests of the Company's
management with those of its shareholders. The Stock Option Committee did not
grant any awards to the Company's key executives and directors during the fiscal
year ended October 30, 2004.

Section 162(m) of the Internal Revenue Code places a limit of $1,000,000
(per person) on the amount of compensation that may be deducted by a public
company in any year for compensation paid to each of a corporation's Named
Officers. Qualifying performance-based compensation is not subject to the
deduction limit if certain requirements are satisfied. The grant of options to
the Named Officers in 2001 under the Stock Incentive Plan does not qualify as
performance-based compensation. The exercise of these options could result in
deductible compensation in excess of the limit imposed by Section 162(m). The
Board may award compensation that may be non-deductible under Section 162(m)
when, in the exercise of its business judgment, such award would be in the best
interests of the Company. The Section 162(m) limitation has not yet had any
effect upon the Company and its ability to deduct, for tax purposes,
compensation paid to its Named Officers.

The Company's independent directors believe that the best interests of the
Company and its shareholders are served by the Company's current compensation
programs. The Board members will continue to review the Company's compensation
plans periodically to determine what changes, if any, should be implemented to
their structure, taking into account the Company's financial condition and
performance.

Submitted by: Charles T. Parton
Albert A. Zager
Robert H. Hutchins

FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES

PERFORMANCE ANALYSIS

Set forth below is a line graph comparing the cumulative total return of
the Company, the AMEX Wholesale & Retail Trade Index, the Standard & Poor's 500
Composite Stock Price Index and the AMEX Composite Index for the five years
commencing October 30, 1999 and ended October 30, 2004.

[GRAPHIC]

CERTAIN TRANSACTIONS

(a) Transactions with Management and Certain Business Relationships

As required by the By-Laws of Wakefern, the obligations owed by the
Company to Wakefern are personally guaranteed by Joseph J. Saker, Richard J.
Saker, Joseph J. Saker, Jr. and Thomas A. Saker. As of October 30, 2004 the
Company was indebted to Wakefern in the amount of approximately $39,639,000 for
current charges in the ordinary course of business. Wakefern presently requires
each of its shareholders to invest up to $650,000 in Wakefern's non-voting
capital stock for each store operated by it, computed in accordance with a
formula based on the volume of such store's purchases from Wakefern. As of
October 30, 2004, the Company had a 15.5% investment in Wakefern of $16,444,000.
As a shareholder member of Wakefern, the Company earns a share of any annual
Wakefern patronage dividend. The dividend is based on the distribution of
operating profits on a pro rata basis in proportion to the dollar volume of
business transacted by each member with Wakefern during each fiscal year. As of
October 30, 2004, the Company was indebted in connection with an investment in
Wakefern. The debt of $4,457,000 was non-interest bearing and payable in
scheduled installments over a period of up to seven (7) years. Additional
information with respect to the Company's relationship with Wakefern is
contained in the Company's 2004 Annual Report on Form 10-K and in the notes to
the Company's 2004 financial statements.

The Company also has an investment in Insure-Rite, Ltd., another company
affiliated with Wakefern, of $1,211,000 as of October 30, 2004. Insure-Rite,
Ltd. provides the Company with a portion of its liability insurance coverage
with the balance paid through Wakefern to private carriers. The Company paid
$5,014,000 for such insurance coverage in fiscal 2004 and believes that such
amount is comparable to the amount that would be charged by a similarly situated
unaffiliated general liability and property insurer.

PROXY STATEMENT

The Company leases from Joseph J. Saker, the Chairman of the Company, and
his wife, doing business as Saker Enterprises, a 57,000 square foot supermarket
in Freehold, New Jersey, under a lease expiring December 31, 2018. This lease
provides for four five-year extension options. The Company also leased from
Saker Enterprises a 5,200 square foot garden center building and 5,000 square
feet of yard area under a lease which expired on December 31, 2003. The Company
continued to lease the property on a month to month basis until August 1, 2004
when the lease was terminated. In addition, the Company leases from Saker
Enterprises 9,000 square feet of space for a liquor store under a lease expiring
December 31, 2008. Both the garden center and liquor store properties are
located in the same shopping center as the supermarket. During the fiscal year
ended October 30, 2004, an aggregate amount for rent (including taxes and
insurance) of $921,000 was paid by the Company to Saker Enterprises for the
supermarket, garden center and liquor store.

The Company subleases from Wakefern a supermarket in East Windsor, New
Jersey, under a sublease expiring in 2008. The Company also subleases from
Wakefern a supermarket in Marlboro, New Jersey, under a sublease expiring in
2006. During the fiscal year ended October 30, 2004, aggregate amounts for rent
of $1,166,000 and $837,000 were paid by the Company to Wakefern for the East
Windsor supermarket and the Marlboro supermarket, respectively. Upon expiration
of these subleases, the underlying leases will be assigned to and assumed by the
Company provided that certain conditions, which include the absence of defaults
by the Company in its obligations to Wakefern and the Company's lenders, and the
maintenance of a specified level of net worth, are satisfied. The term of the
leases for the East Windsor and Marlboro supermarkets expire in 2018 and 2021,
respectively.

The Company believes that the terms of the foregoing transactions are
comparable to those available from non-affiliated persons under similar
circumstances.

(b) Indebtedness of Management

None.

INDEPENDENT AUDITORS

The firm of Amper, Politziner & Mattia, P.C., Independent Registered
Public Accountants, was retained as independent auditors to the Company for the
year ended October 30, 2004 by the Audit Committee of the Board of Directors. A
representative of Amper, Politziner & Mattia, P.C. will be present at the Annual
Meeting to make a statement, if desired, and to respond to appropriate
questions.

ANNUAL REPORT

The Company's Annual Report to shareholders for the fiscal year ended
October 30, 2004, including financial statements, which Annual Report is not
part of this proxy solicitation material, is being mailed to shareholders with
the proxy solicitation.

OTHER BUSINESS

Management is not aware at this time of any other matters to be presented
for action. If, however, any other matters properly come before the Annual
Meeting, unless otherwise directed, the persons named in the proxy intend to
vote in accordance with their judgment on the matters presented.

PROXY SOLICITATION

The cost of solicitation of proxies will be borne by the Company. Such
solicitation will be made by mail and may also be made by the Company's
directors, officers, or regular employees personally or by telephone or
telegraph. Brokerage houses, nominees, fiduciaries and other custodians will be
requested to forward soliciting materials to beneficial owners of shares and
will be reimbursed by the Company for their reasonable expenses. The Company
does not expect to pay any compensation to third parties for the solicitation of
proxies unless such solicitation has been requested by the Company.

FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES

SHAREHOLDER COMMUNICATIONS WITH DIRECTORS

The Board has adopted a formal process to be followed for those
shareholders who wish to communicate directly with the Board or any individual
director of the Company. A shareholder can contact the Board, or any individual
director, by sending a written communication to: Board of Directors, Foodarama
Supermarkets, Inc., c/o Director--Internal Audit, 922 Highway 33, Building 6,
Suite 1, Freehold, New Jersey 07728. A shareholder's letter should also indicate
that he or she is a Foodarama shareholder. The Director--Internal Audit of the
Company shall either (a) distribute such communication to the Board, or a member
or members thereof, as appropriate depending upon the facts and circumstances
described in the communication received; or (b) determine that the communication
should not be forwarded to the Board because, in his or her judgment, (i) the
communication is primarily commercial in nature and relates to the Company's
ordinary business or relates to a topic that is improper or not relevant to the
Board; or (ii) the Company's management can adequately handle the shareholder
inquiry or request, in which case the inquiry or request will be forwarded to
the appropriate individual. If a shareholder communication is addressed to one
or more members of the Board, but not the entire Board, the Director--Internal
Audit shall notify any member of the Board to whom such communication was not
addressed that such communication was received and shall provide a copy of such
communication upon request.

SHAREHOLDER PROPOSALS AND NOMINEES FOR DIRECTOR

A shareholder of the Company who wishes to present a proposal for action
at the Company's 2006 annual meeting of shareholders must submit a detailed
description of such proposal to the Company's Secretary, either personally or by
first class mail, postage pre-paid, and include the following additional
information: (1) the name and record address of the proposing shareholder; (2)
the number of shares of the Company which are beneficially owned by the
proposing shareholder; and (3) any material interest of the proposing
shareholder in such business. Such proposal and additional information must be
received by the Company by October 31, 2005. The Board retains the right to
request additional information as may be required to comply with the proxy rules
and regulations of the SEC.

The independent directors of the Board will also consider nominees for
director suggested by shareholders of the Company applying the same criteria for
nominees described above and considering the additional information required
below. A shareholder who wishes to suggest a nominee for director should send a
written communication to the Company's Secretary by personal delivery or first
class mail, postage pre-paid, and include the following information: (1) the
name of and contact information for the proposing shareholder and the nominee;
(2) a representation that the proposing shareholder is a holder of record of
common stock of the Company entitled to vote at the annual meeting and intends
to appear in person or by proxy at the annual meeting to nominate the person or
persons specified in the notice; (3) a statement of the nominee's business
experience and educational background; (4) a detailed description describing any
relationship between the nominee and the proposing shareholder; (5) a statement
by the shareholder explaining why he or she believes that the nominee is
qualified to serve on the Board and how his or her service would benefit the
Company; and (6) a signed statement by the nominee that the nominee is willing
to be considered and willing to serve as a director of the Company if nominated
and elected. The Board retains the right to request additional information as
may be required to comply with the proxy rules and regulations of the SEC. A
shareholder wishing to suggest a nominee for director for possible consideration
at the Company's 2006 annual meeting of shareholders must submit the required
information to the Company and such information must be received by the Company
by October 31, 2005. The Board retains complete discretion for making
nominations for election as a member of the Board.

ANNUAL REPORT ON FORM 10-K

On written request, the Company will provide without charge to each record
or beneficial holder of the Company's Common Stock a copy of the Company's
Annual Report on Form 10-K as filed with the SEC for the fiscal year ended
October 30, 2004. Requests should be addressed to Mr. Joseph C. Troilo, Senior
Vice President--Financial Administration, Foodarama Supermarkets, Inc., 922
Highway 33, Building 6, Suite 1, Freehold, New Jersey 07728.

By Order of the Board of Directors,

/s/ Joseph J. Saker, Jr.

Howell, New Jersey Joseph J. Saker, Jr.
February 25, 2005 Secretary