Arthur T. Demoulas’ Letters to Associates and Keith Cowan

The following are letters from Arthur T. Demoulas to the associates and to Mr. Cowan, both of which were sent to all stores and warehouses today. As of today, December 26, the Board has only made one of the recommended changes to its site. Arthur’s words, as always, speak clearly for themselves and underscore his firm belief in communicating openly with all stakeholders; the Board’s inaction in this matter, as always, underscores our firm belief that they are clueless.


Dear Associates:

Attached is a letter I sent last Friday, December 13, to Keith Cowan, Interim Chairman of the Board of Directors. As you can see, it relates to claims made on the Board’s website that are not accurate. The letter was sent in advance of the Board meeting that took place at 4:00 p.m. on Monday, December 161h. I was hopeful that the Board’s majority would recognize either: (a) that the website is not a benefit to DSM and eliminate it, or (b) at a minimum would correct the information on it. While they have made minor corrections to the information relating to the hiring of an executive search firm, they apparently have no intention of correcting the other inaccuracies.

It is important that when the Company decides to communicate with its Associates, it do so truthfully. That is a point I have made repeatedly with this new Board. And so, I am making my letter to Mr. Cowan available for your review in order to set the record straight.


Arthur T. Demoulas
President and CEO

cc: All Members, Board of Directors


Keith Cowan
2874 Rivermeade Drive
Atlanta, GA 30327


I notice that you have an agenda item on for your Monday, December 16 meeting involving a discussion of your website. I am completely opposed to the Board having a website. Any company should speak to its associates, its customers and the public through its CEO. To have a Board website is, as you conceded at the November 1, 2013 meeting, unprecedented. To quote your words from November 1 in answer to a question about a Board creating a website: “I don’t think there is anything equivalent to this.”

According to the transcripts of Board meetings and the website itself, the postings on the website were intended to be factual. Instead, in significant ways the information is wrong. And. though it claims to speak for the Board, as you know it only speaks for a portion of the Board (it does not speak for the “B” directors). In other instances, it clearly takes sides on behalf of the “A” shareholders over the “B” shareholders. I urge you to promptly either close the website or at a minimum fix the site and eliminate the half-truths and inaccuracies. However you decide to proceed, as I indicated to you back in July, I intend to make sure that our Associates have the truth. This is consistent with my letter to you of July 23, 2013. At the time, I was concerned about the accuracy of a draft letter you proposed to send to our Associates. I advised against sending it and cautioned that if it were sent and drew questions, management would “have an obligation and responsibility to make sure that our Associates receive accurate and complete factual information …”

Since the website launched at the beginning of November, it has contained the following: “.. . the Board may, in the future, retain an executive search firm to assist it in identifying qualified potential candidates from outside the organization.” That statement, and the others referred to below, remains on the site today. This claim has been false from the moment it appeared on the website. You have been actively engaged in discussions with Spencer Stuart with authority to engage them since at least October. You acknowledged as much at the November 1 meeting. (Transcript pgs. 140-144) And, at a minimum, the Board voted to retain them at its November 1 meeting, one day before the website was launched. And now you have submitted bills totaling in excess of $300,000 from Spencer Stuart for search services in
November, December and January. Whether there is an arrangement to compensate Spencer Stuart for work in October, there can be no doubt that they have been on the job since at least November 1, despite the claim to the contrary on the website. And we both know that they have been engaged to find or at least consider replacements for members of current management.

Then your website claims that “on November 1, the Board voted to “make a contribution to … the profit sharing plan at a level that is an increase over the prior year …” As you know, that increase is simply a product of higher wages for this year and an increase in employee count.

In both the section on bonus payments and the section where you report on the actions of the Board at its November 25, 2013 meeting, you report that Market Basket’s profitability for 2013 is expected to be below the profit margin for 2012:

  • “Market Basket’s profitability for 2013 is expected to be below the profit margin for 2012.”
  • “it is clear that Market Basket’s profit margins will be lower than the prior year and that net income will be flat or less than prior years.”
  • “the company’s profitability is expected to decrease in 2013.”

(All quotes are from the FAQs section of

It is incomprehensible (and a breach of both your fiduciary duty and your newly proposed Code of Business Conduct and Ethics- Section 5 defining Confidential Information) that in a private company you announce three times to the world, including our competitors, that 2013 profitability is expected to be lower than that of 2012.

Next, you claim that the memo from Bill Marsden was “misleading and riddled with errors.” You know full well that Mr. Marsden’s memo to the Associates was respectful and accurate. Maybe you would like to take on the challenge of detailing how it was “misleading and riddled with errors”?

In the same section, you claim that the Board deferred making a “decision on management’s recommendations for other incremental bonuses,” because of “the very late timing of the request and given that management provided no substantive information supporting the request …”¬† These claims too are inaccurate. Management provided its bonus recommendations in a timely fashion. It provided the Board and its subcommittee with the recommendations and substantive reasons for them on November 19, 22, 24 and again at the full Board meeting on November 25.

But, most troubling is that you have taken a public position that the Board has initiated changes to the profit sharing program that include “a process for selecting nationally recognized investment advisors” and “ensure a conservative, yet better return (while avoiding the mistakes made by the prior plan Trustees that required a $46 million ‘bailout’ from the Company for a bad investment).”

1. The profit sharing program has long had in place nationally recognized investment advisors.

2. Every member of the Board knows that you cannot “ensure … a better return” in an investment fund.

3. And your position that you seek to avoid “mistakes made by the prior plan Trustees …” for a bad investment is not only false but is also exactly the position taken over the last several years by your sponsor, Arthur S. Demoulas¬∑, and exactly contrary to the litigation position taken by the profit sharing plan in litigation brought by it against Goldman Sachs. And, under your leadership, you have taken this position publicly for Goldman Sachs or anyone else to read and attempt to use to the disadvantage of the profit sharing plan participants.

I hope you will seriously consider the facts in this letter and take the appropriate action requested.

Arthur T. Demoulas
President and CEO

cc: All Members, Board of Directors


  1. Mark Smith says:

    Sincerity, and values that second to none!, That is why ATD is our CEO!

  2. lisa deltrecco says:

    Wow, way to go Artie T.! Thank you for sharing this letter with us, you are a true leader, fighting for your values and beliefs. I wish you success.
    We are behind you 100%!

  3. CINdy Whelan says:

    The only words that come to my mind upon reading in letter formation what we already know is thank you Artie, or as I call you, Mr. D. You stand true to your associates, customers, liaisons, all the stakeholders. I am not ignorant to the fact that I am a stakeholder. In fact, I cherish it! ATD will never settle for less than transparency, and I have sent multiple emails in regards to their claims of transparency, not one response did I receive. So, who do I put my faith in? ATD, always and forever,.

  4. elizabeth bates says:

    Thank you sir for continuing your policy of treating your associates as your team members, not with empty gestures or meaningless phrases but with the respect you show and your honest inclusion of all associates, makes a world of difference in how we invest ourselves, working together, to make our company the best it can be. We fully back you, as you have proven that you are the straight up person worthy to be at the helm of this company. We all are with you sir, and thank you for respecting our position as fellow associates who really do care. Thank you.

  5. Tom Trainor says:

    This Company was built and continues to thrive on the dedication, hard work and loyalty of the PEOPLE. No matter what your position is within our Company we all have a role to play and we make it happen. We are all treated like members of a family not employees. ATD is the ONLY person that we want to run our Company and we want him to be able to run our Company without restrictions that have been placed on him by this Board. The Board’s website should be taken down, there is little information on it that is true, there is no transparency with this Board to management, associates or stakeholders. The Board should be working WITH us not against us on a public forum where they can hide in the shadows. We trust ATD, we do not trust the Board nor do we believe anything they say. Thank you Artie for always being open and true with us. I will stand beside him to the end and I know our people will as well.

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