SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to S240.14a-11(c) or S240.14a-12
Mod-U-Kraf Homes, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form of Schedule and the date of its filing.
1) Amount Previously Paid:
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4) Date Filed:
MOD-U-KRAF HOMES, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that the 1999 Annual Meeting of Shareholders of
Mod-U-Kraf Homes, Inc. will be held at the BB&T Bank located at 216
College Street, Rocky Mount, Virginia on March 24, 1999 at 10:00 a.m.
for the following purposes:
1. To elect a Board of Directors to serve for the ensuing year; and
2. To transact such other business as may properly come before the
meeting.
The Board of Directors has fixed February 17, 1999 at the close of
business, as the record date for the determination of shareholders entitled
to notice of and to vote at the Annual Meeting and any adjournment thereof.
You are requested to mark, sign, date and return the enclosed proxy
promptly regardless of whether you expect to attend the meeting. A postage
-paid return envelope is enclosed for your convenience.
If you are present at the meeting, you may vote in person even though
you may have previously delivered your proxy.
By Order of the Board of Directors
EDWIN J. CAMPBELL, Corporate Secretary
March 5, 1999
** end of proxy notice **
** start proxy statement **
MOD-U-KRAF HOMES, INC.
P. O. Box 573
Rocky Mount, Virginia 24151
Telephone: (540)483-0291, FAX (540)483-2228
PROXY STATEMENT
GENERAL
Proxies in the form enclosed are solicited by the Board of Directors of
Mod-U-Kraf Homes, Inc. (the "Company") for the Annual Meeting of
Shareholders (the "Annual Meeting") to be held at 10:00 a.m. on March 24,
1999 at the BB&T Bank located at 216 College Street, Rocky Mount, Virginia.
Any person giving a proxy may revoke it at any time before it is voted by
means of a writing addressed to the Secretary of the Company, by giving a
subsequently dated proxy or by voting personally the shares represented
by the proxy. A proxy, when executed and not so revoked, will be voted and,
if the proxy contains any specific instructions, it will be voted in
accordance with such instructions.
The Company is mailing this Proxy Statement and the accompanying proxy
on or before March 5, 1999 to all shareholders of record at the close of
business on February 17, 1999 (the "Record Date"). The cost of solicitation
of proxies will be borne by the Company. In addition to the use of the mails,
proxies may be solicited by employees of the Company, but no special
compensation will be paid to any employee for such solicitation.
OWNERSHIP OF EQUITY SECURITIES
The Company's only authorized equity is common stock, $1 par value
("Common Stock"), each share of which has one vote on all matters. There
were outstanding and entitled to vote 825,649 shares of Common Stock on the
Record Date.
The following table presents certain information as of the Record Date
regarding beneficial ownership of Common Stock by the directors and nominees
for directors, officers and directors as a group, and all owners of more
than 5% of the Common Stock.
Amount and Nature
Name of Beneficial of Beneficial Percent
Owner Ownership Owned
------------------ --------------------- -------
Edwin J. Campbell 33,892(1) 4.10%
Dale H. Powell 68,800 8.33
W. Curtis Carter 36,720 4.45
Bobbie L. Oliver 173,406 21.00
Mary L. Fitts 66,000(2) 7.99
All officers and directors
as a group(8 persons) 379,730 45.99
Robert K. Fitts 78,547(3) 9.51
P. O. Box 82 Boones Mill, VA 24065
(1) Includes shares held in various fiduciary capacities and
owned by or with certain relatives.
(2) Includes 66,000 shares with respect to which voting and
investment power is shared with Robert K. Fitts
(3) Includes 12,547 shares with respect to which Mr. Fitts has
sole voting and investment power and 66,000 shares with
respect to which such power is shared with Mary L.
Fitts.
ELECTION OF DIRECTORS
Proxies will be voted for the election of the following nominees as
directors. The Board of Directors has no reason to believe that any of the
nominees will be unavailable, but if so proxies will be voted for such
substitutions as the Board of Directors shall designate. The election of
each nominee for director requires the affirmative vote of the holders of a
plurality of the shares of Common Stock cast in the election of directors at
a meeting in which a quorum (a majority of all outstanding shares of
Common Stock) is present. Votes that are withheld and shares held in
street name that are not voted in the election of directors will not be
included in determining the number of votes cast. Unless otherwise
specified in the accompanying form of proxy, it is intended that votes will
be cast for the election of all of the nominees as directors.
Name Age Director Since
------ ----- ----------------
Edwin J. Campbell . . . . . . . . 69 1978
Dale H. Powell . . . . . . . . . 65 1980
W. Curtis Carter . . . . . . . . 80 1991
Bobbie L. Oliver . . . . . . . . . 66 1994
Mary L. Fitts . . . . . . . . . . 59 1994
EDWIN J. CAMPBELL was Vice President of Sales and Marketing of the
Company from 1977 until 1990, and has been Corporate Secretary since March
1990. He has been Vice President since October 1990.
DALE H. POWELL was Vice President-Operations of the Company from 1980
to March 1990, when he became President and Chairman of the Board. Mr.
Powell was Secretary of the Company from March 1988 until March 1990. Mr
Powell is the brother of J. Dillard Powell.
W. CURTIS CARTER, presently retired, was an Officer and Director of
Stuart Lumber Corporation in Stuart, Virginia for 24 years until the
company was sold to the Masonite Corporation in 1977. He remained with
Masonite in accounting and other capacities until his retirement in 1988.
BOBBIE L. OLIVER is the wife of the late O. Z. Oliver, Co-founder and
former Board Chairman of Mod-U-Kraf Homes, Inc. She is the largest
shareholder of the Company and is managing real estate and rental
properties. She is the sister-In-law of Dale H. Powell and the sister of
Mary L. Fitts.
MARY L. FITTS, Real Estate Investor, has been owner and operator of an
apartment complex since 1983. She is the wife of Robert K. Fitts,
co-founder of the Company. She is the sister-In-law of Dale H. Powell and
the sister of Bobbie L. Oliver.
Meetings and Committees of the Board
The Board of Directors does not have a standing executive committee,
nomination committee, compensation committee or audit committee but instead
fulfills the functions of these committees itself. The Board of Directors
also functions as the nominating committee and reviews the qualifications
of possible candidates suggested by management of the Company.
The Stock Option Committee of the Board of Directors administers the
Company's stock option plan and consists of Messrs. Campbell and Carter.
The Board of Directors held five meetings during fiscal 1998 and the
Stock Option Committee met one time. No director attended fewer than 75%
of these meetings.
Executive Compensation Committee Interlocks and Insider Participation
The Company's Board of Directors, including Company officers Edwin J.
Campbell and Dale H. Powell, functioned as the executive compensation
committee in 1998.
Executive Compensation Committee Report
At Mod-U-Kraf Homes, Inc., all members of the Board of Directors serve
as members of the Compensation Committee. It is the desire of the Committee
to establish a compensation program designed to attract and retain key
employees. Compensation is based on the local pay scales and comparable
industry standards. Compensation for key Company employees is reviewed
each year based on job performance and recommendations to the Board by the
President and Vice President. The President and Vice President are
members of the Board of Directors.
Mod-U-Kraf's executive compensation is based on industry standards for
comparative sized companies. In addition to a base salary, there is
potential for an annual incentive bonus to be earned based on Company
profits before taxes. Only two key executives, the President and Vice
President, participate in the incentive bonus which is detailed in their
respective employment contracts. All other key employees have a base
salary which is reviewed from time to time. There are no other incentives
except those available to all employees, such as profit sharing and stock
option plans.
BOARD OF DIRECTORS
Dale H. Powell Edwin J. Campbell
W. Curtis Carter Bobbie L. Oliver
Mary L. Fitts
February 3, 1999
EXECUTIVE COMPENSATION
The following table presents information relating to total compensation
of the Chief Executive Officer of the Company during the periods indicated.
SUMMARY COMPENSATION TABLE
Annual Compensation
All
Name and (1) Other (2)
Principal Position Year Salary Bonus Compensation
Dale H. Powell 1998 $75,000 $8,995 $14,532
President and
Chairman of the 1997 $75,000 $9,651 $14,511
Board
1996 $75,000 $20,322 $15,278
(1) Bonus is calculated on the prior years' earnings in accordance with
Mr. Powell's employment agreement.
(2) Consists of $13,207 of premiums paid annually by the Company on a
"split-dollar" insurance policy for 1998, 1997 and 1996, and $1,325, $1,304
and $2,071 of Company contributions to Mr. Powell's profit-sharing plan
account for 1998, 1997 and 1996 respectively.
Employment Agreements
Under an Employment Agreement with the Company, effective January 1,
1991, Dale H. Powell will be paid an annual base salary of $75,000, subject
to annual review by the Board of Directors. In addition to the base salary,
Mr. Powell will be paid incentive compensation equal to 3% of the income of
the Company before federal and state income taxes, and before the payment
of any dividends or extraordinary non-recurring items or expenses.
Compensation of Directors
Outside directors are paid a fee of $250.00 for each meeting of the
Board of Directors attended.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Pursuant to a settlement agreement between the Company and the Estate
of O. Z. Oliver, deferred compensation benefits of $75,726 were paid to
Mr. Oliver's widow, Bobbie L. Oliver, during 1998. In addition, $2,122
was paid in 1998 to Mrs. Oliver for health insurance premiums. Mrs.
Oliver, a director, is the sister-in-law of Dale H. Powell, President and
Chairman of the Board of the Company and the sister of Mary L. Fitts.
Pursuant to a settlement agreement between the Company and Robert K.
Fitts, deferred compensation benefits of $66,724 and a sum of $10,000 in
premiums for life insurance policies assigned to Mr. Fitts were paid to
Mr. Fitts in 1998. In addition, $6,000 was be paid in 1998 to Mr. Fitts
for health insurance premiums for Mr. Fitts and Mary L. Fitts, his spouse.
Mr. Fitts' spouse, Mary L. Fitts, a director, is the sister of Bobbie L.
Oliver and the sister-in-law of Dale H. Powell, President and Chairman of
the Board of the Company.
In the normal course of business, the Company makes purchases from a
supplier owned by the family of J. Dillard Powell, the recently deceased
brother of Dale H. Powell. The supplier was acquired by Mr. Powell in 1989.
Prior to that time, the supplier had been a long time vendor of the Company.
Purchases from this supplier totaled $643,000 for 1998.
SECTION 16(A) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
The Company's directors, executive officers and owners of more than 10%
Company's shares are required under the Securities Exchange Act of 1934 to
file reports of ownership and changes in ownership with the Securities
Exchange Commission. Copies of these reports must also be furnished to the
Company. Based solely on review of the copies of such reports furnished
to the Company through the date hereof, or written representations that
no reports were required; the Company believes that during 1998, all
filing requirements applicable to its officers, directors and 10%
shareholders were met.
SELECTION OF AUDITORS
The Board of Directors has appointed Brown, Edwards and Company,
independent certified public accountants, as auditor of the books and
records of the Company for fiscal 1999. Brown, Edwards and Company audited
the accounts of the Company for fiscal 1998. Representatives of Brown,
Edwards and Company are expected to be present at the Annual Meeting, will
be given an opportunity to make a statement, and will be available to
respond to appropriate questions if they desire to do so.
MATTERS TO BE PRESENTED AT THE
2000 ANNUAL MEETING OF SHAREHOLDERS
Any shareholder wishing to make a proposal to be acted upon at the 2000
Annual Meeting of Shareholders and to be included in the Company's proxy
statement for such meeting must present such proposal to the Company at its
principal office in Rocky Mount, Virginia not later than November 6, 1999.
The deadline for submitting a stockholder proposal or a nomination for
director that is not to be included in such proxy statement is January 20,
2000. If the Company receives notice of a shareholder proposal after
January 20, 2000, the persons named as proxies in the proxy statement for
the 2000 Annual meeting will have discretionary voting authority to vote on
such proposal at the 2000 Annual meeting.
OTHER MATTERS
At the date of this Proxy Statement, management knows of no matter to
come before the Annual Meeting other than those stated in the notice of the
Annual Meeting. As to other matters, if any, that may properly come before
the Annual Meeting, it is intended that proxies in the accompanying form
will be voted in accordance with the best judgment of the person or persons
named therein. As to other matters, if any, that may properly come before
the Annual Meeting, it is intended that proxies in the accompanying form
will be voted in accordance with the best judgement of the person or
persons named therein.
* * *
We hope that you will be able to attend this meeting in person, but
if you cannot be present, please execute the enclosed proxy card and return
it in the accompanying postage-paid envelope as promptly as possible.
Your stock will be voted in accordance with the instructions you give on
the proxy, and in the absence of any such instructions will be voted FOR
election of all nominees of the Board of Directors.
EDWIN J. CAMPBELL, Corporate Secretary
March 5, 1999
** end of proxy statement **
** proxy card **
PROXY MOD-U-KRAF HOMES, INC.
P. O. Box 573, Rocky Mount, Virginia, 24151
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Dale H. Powell and Edwin J. Campbell as
Proxies, each with the power to appoint his substitute, and hereby
authorizes them to represent and vote, as designated below, all the shares
of common stock of Mod-U-Kraf Homes, Inc. held of record by the undersigned
on February 17, 1999 at the annual meeting of shareholders to be held on
March 24, 1999 or at any adjournment thereof.
1. ELECTION OF DIRECTORS FOR all nominees listed WITHHOLD AUTHORITY
below (except as marked to vote for all
to the contrary below) nominees listed
[ ] below [ ]
INSTRUCTION: To withhold authority to vote for any individual nominee,
strike through the nominee's name in the list below.
W. Curtis Carter Dale H. Powell Edwin J. Campbel
Mary L. Fitts Bobbie L. Oliver
2. In their discretion, the Proxies are authorized to vote upon such
other business as may properly come before the meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS
PROXY WILL BE VOTED FOR PROPOSAL 1.
When shares are held by joint tenants, both should sign. When signing
as an attorney, executor, administrator, trustee or guardian, please give
full title as such. If a corporation, please sign in full corporate name
by president or other authorized officer. If a partnership, please sign
in partnership name by authorized person.
Signature
Signature if held jointly
Dated , 1999
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING
THE ENCLOSED ENVELOPE.
** end of proxy card **