SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
WOLOHAN LUMBER CO.
(Name of Registrant as Specified in Its Charter)
WOLOHAN LUMBER CO.
(Name of Person(s) Filing Proxy Statement)
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 transactions applies: ________
______________________________________________________________________
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:* _________________________________
______________________________________________________________________
(4) Proposed maximum aggregate value of transaction: _____________________
(5) Total fee paid: ______________________________________________________
______________________________________________________________________
[ ] Fees 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 or schedule and the date of its filing.
(1) Amount previously paid: _____________________________________________
(2) Form, schedule or registration statement no.: _______________________
(3) Filing party: _______________________________________________________
(4) Date filed: _________________________________________________________
WOLOHAN LUMBER CO.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
APRIL 29, 1999
To The Stockholders Of
Wolohan Lumber Co.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
Wolohan Lumber Co. will be held on Thursday, the 29th day of April, 1999, at
2:00 P.M., Local Time, at the Citizens Bank Building, 101 North Washington
Avenue, Saginaw, Michigan for the following purposes:
1. To elect a Board of five Directors of the Company to hold office
until the next Annual Meeting of Stockholders or until their
successors are elected and qualified; and
2. To transact such other business as may properly come before the
meeting or any adjournments thereof.
Stockholders of record at the close of business on March 1, 1999 are
entitled to vote at the meeting or any adjournments thereof. Stockholders are
requested to date, sign and mail the enclosed Proxy Card promptly in the
enclosed addressed envelope.
By Order of the Board of Directors,
DAVID G. HONAMAN, Secretary
March 26, 1999
WOLOHAN LUMBER CO.
1740 Midland Road
Saginaw, Michigan 48603
PROXY STATEMENT
---------------
March 26, 1999
This Proxy Statement contains information related to the Annual Meeting
of Stockholders of Wolohan Lumber Co., a Michigan corporation, to be held on
Thursday, April 29, 1999, beginning at 2:00 p.m. local time, at the Citizens
Bank Building, 101 North Washington Avenue, Saginaw, Michigan, and at any
adjournments of the meeting. The Proxy Statement and the accompanying Proxy
Card are first being mailed to stockholders on or about the above date.
ABOUT THE MEETING
What is the purpose of the Annual Meeting
At the Company's Annual Meeting, stockholders will elect directors to
serve for the ensuing year. In addition, the Company's management will report
on the performance of the Company during 1998 and respond to questions from
stockholders.
Who is entitled to vote?
Only stockholders of record of the Company's Common Stock at the close
of business on the record date, March 1, 1999, are entitled to receive notice
of the Annual Meeting and to vote the shares of Common Stock that they held
on that date at the meeting or any adjournment of the meeting. Each
outstanding share entitles its holder to cast one vote on each matter to be
voted on.
What constitutes a quorum?
The presence at the meeting, in person or by proxy, of the holders of a
majority of the shares of Common Stock outstanding on the record date will
constitute a quorum, permitting the meeting to conduct business. As of the
record date, 5,370,345 shares of Common Stock of the Company were
outstanding. Proxies received but marked abstentions and broker non-votes
will be included in the calculation of the number of shares considered to be
present at the meeting but will be disregarded in tabulating the vote on the
election of directors.
How do I vote?
If you are a registered stockholder, (that is, if you hold your stock
in your own name), and you complete and properly sign the accompanying Proxy
Card and return it to the Company's stock transfer agent, State Street Bank
and Trust Company, it will be voted as you direct. If you attend the meeting,
you may deliver your completed Proxy Card in person.
If your shares are held in "street name" and you complete and properly
sign the Proxy Card provided to you by your broker or other nominee, the
broker or other nominee is required to vote your shares as you direct
pursuant to a duly executed Proxy Card.
1
Can I change my vote after I submit my proxy?
Yes. Even after you have submitted your proxy, you may change your vote
at any time prior to the close of voting at the meeting by filing with the
Secretary of the Company either a notice of revocation or a duly executed
proxy bearing a later date.
What vote is required for the election of directors?
The affirmative vote of a plurality of the votes cast at the meeting is
required for the election of directors. A properly executed proxy marked
"Withhold Authority" with respect to the election of one or more directors
will not be voted with respect to the director or directors indicated,
but will be counted for purposes of determining whether there is a quorum.
STOCK OWNERSHIP
How much Common Stock do the Company's directors and executive officers own?
The following table sets forth, as of March 1, 1999, the number of
shares of the Company's Common Stock beneficially owned by each director,
each executive officer named in the Summary Compensation Table and all
directors and executive officers as a group.
Name of Individual Number Percent
or Group of Shares(1) of Class
------------------ ------------ --------
Hugo E. Braun, Jr. ......................... 11,470(2) *
Leo B. Corwin .............................. 4,000(2) *
David G. Honaman ........................... 52,364(3) *
Curtis J. LeMaster ......................... 8,000(3) *
Lee A. Shobe ............................... 4,500(2) *
John A. Sieggreen .......................... 12,020(3)
Charles R. Weeks ........................... 4,000(2) *
James L. Wolohan ........................... 1,553,055(4) 28
All Directors, Nominees and
Executive Officers as a
Group (8 persons) ........................ 1,649,409(5) 30
<FN>
* Less than one percent
(1) The number of shares shown in the table does not include 9,498 shares
owned by spouses and children where beneficial ownership is disclaimed
and does not include any shares held in the Long-Term Incentive Plans.
(2) The number of shares shown in the table includes shares which the
following directors have the right to acquire upon the exercise of stock
options granted under the Stock Option Plan for Non-Employee Directors:
Hugo E. Braun Jr., Leo B. Corwin, Lee A. Shobe and Charles R. Weeks,
3,000 shares each.
(3) The number of shares shown in the table includes shares issuable upon the
exercise of stock options within 60 days of March 1, 1999 for the
following executive officers: David G. Honaman -- 21,000 shares, Curtis
J. LeMaster -- 8,000 shares and John A. Sieggreen -- 12,000 shares.
(4) The number of shares shown in the table as beneficially owned by James L.
Wolohan includes 77,440 shares which he owns in his own name, 45,000
shares issuable upon the exercise of stock options within 60 days of
March 1, 1999, 1,573 shares which he holds as custodian and 1,429,042
shares which he holds with Michael J. Wolohan as Co-Trustee.
(5) Includes 1,430,615 shares which directors and officers (including James
L. Wolohan) hold as trustees or in other fiduciary capacities but does
not include shares held by family members in their own right or in other
trusts for the benefit of family members where beneficial ownership is
disclaimed by the director or officer.
2
Who are the largest owners of the Company's Common Stock?
The following table sets forth certain information concerning persons
which, to the knowledge of the Company, own as of March 1, 1999 more than 5%
of the outstanding Common Stock.
Name of Number Percent
Beneficial Owner of Shares(1) of Class
---------------- ------------ --------
Michael J. Wolohan and James L. Wolohan as
Co-Trustees................................... 1,429,042(2) 26.6
Franklin Resources, Inc. ..................... 677,844(3) 12.6
777 Mariners Island Boulevard
San Mateo, California 94404
Timothy W. Wolohan Family .................... 466,824(4) 8.7
6 Pinehurst Lane
Cincinnati, Ohio 45208
Dimensional Fund Advisors Inc................. 414,792(3) 7.7
1299 Ocean Avenue
Santa Monica, California 90401
<FN>
(1) Beneficial ownership of shares, as determined in accordance with
applicable Securities and Exchange Commission rules, includes shares as
to which a person has or shares voting power and/or investment power.
(2) In addition, 7,260 shares are held by Michael J. Wolohan's spouse as
Trustee and 1,331 shares are held by Michael J. Wolohan as Trustee;
James L. Wolohan owns 77,440 shares, is custodian of an account which
holds 1,573 shares and holds stock options exercisable within 60 days
of March 1, 1999 to purchase 45,000 shares; and James L. Wolohan's
spouse holds 9,489 shares as Trustee of four trusts.
(3) Based on information set forth in a Schedule 13G filed with the
Securities and Exchange Commission.
(4) These shares include shares owned by Timothy W. Wolohan; shares held by
Timothy W. Wolohan as custodian; shares held by Timothy W. Wolohan as
Co-Trustee; shares owned by Georgine Wolohan, the wife of Timothy W.
Wolohan; shares held by Georgine Wolohan as custodian; and shares held
by Timothy W. Wolohan and Georgine Wolohan as Co-Trustees.
ELECTION OF DIRECTORS
The By-Laws of the Company provide that the number of directors shall
be determined by the Board of Directors and shall not be less than five nor
more than nine. The Board of Directors has fixed at five the number of
directors to be elected at the meeting to hold office until the next annual
meeting of stockholders or until their successors are elected and qualified.
It is the intention of the persons named in the enclosed form of proxy to
vote such proxy for the election of the nominees hereinafter named as
directors.
F.R. Lehman who has served as a director since 1986, has elected to
retire as a director at the Annual Meeting of Stockholders.
3
The proposed nominees for election as directors are willing to be
elected as such. If, as a result of circumstances not now known or foreseen,
any of such nominees shall be unavailable or unwilling to serve as a
director, proxies may be voted for the election of such other person or
persons as the Board of Directors may select. Directors are elected by a
plurality of votes which are present in person or represented by proxy at the
meeting.
INFORMATION ABOUT NOMINEES AS DIRECTORS
The following information is furnished with respect to each person
nominated for election as a director, each of whom is presently a director of
the Company.
Has
Served
Principal Occupation and as
Directorships in Other Director
Name and Age of Nominee Publicly Owned Companies(1) Since
- ----------------------- --------------------------- --------
Hugo E. Braun, Jr., 66 ........ Partner, Braun Kendrick Finkbeiner P.L.C.,
Attorneys-at-law. Director of Citizens Banking
Corporation ......................................... 1984
James L. Wolohan, 47 .......... Chairman of the Board, President and Chief Executive
Officer of the Company. Director of Jacobson Stores,
Inc. and Citizens Banking Corporation ............... 1986
Leo B. Corwin, 64 ............. President, Txcor, Inc. Formerly Senior Vice President
of Merchandising for Builders Square, Inc. .......... 1992
Charles R. Weeks, 64 .......... Chairman and Director, Citizens Banking Corporation.
Formerly Chief Executive Officer, Citizens Banking
Corporation ......................................... 1996
Lee A. Shobe, 60 .............. Formerly President and Chief Executive Officer of Dow
Brands, Inc. ........................................ 1996
<FN>
(1) Each of the directors and nominees has had the same principal
occupation during the past five years except as follows: Mr. Shobe
retired on December 31, 1995 after having served as President and Chief
Executive Officer of Dow Brands, Inc. for more than five years.
The law firm of Braun Kendrick Finkbeiner P.L.C., of which firm Hugo E.
Braun, Jr. is a partner, performs legal services for the Company.
The Company maintains banking relationships in the ordinary course of
business with Citizens Bank, a subsidiary of Citizens Banking Corporation, of
which Charles R. Weeks is Chairman and a director and Hugo E. Braun, Jr. and
James L. Wolohan are directors.
How often did the Board meet during 1998?
The Board of Directors held four meetings during 1998.
What are the Committees of the Board and what are the functions of the Board
Committees?
The Company has a standing Audit Committee, Compensation Committee and
Management Review Committee of the Board of Directors.
4
The members of the Audit Committee for 1998 were Hugo E. Braun, Jr.,
Chairman, Leo B. Corwin, F. R. Lehman, Lee A. Shobe and Charles R. Weeks. The
Audit Committee, which met four times during 1998, recommends the appointment,
subject to approval by the Board of Directors, of the Company's independent
auditors. The Committee also reviews the accounting principles and the
financial reporting practices adopted by management, the non-audit services
performed by the independent auditors, and approves the fees paid to the
independent auditors.
The members of the Compensation Committee for 1998 were Charles R.
Weeks, Chairman, Hugo E. Braun, Jr., and F.R. Lehman. The Compensation
Committee met four times during 1998. The Committee reviews and recommends to
the Board of Directors the compensation of officers of the Company, examines
periodically the compensation structure of the Company and administers the
Company's Long-Term Incentive Plan.
The members of the Management Review Committee for 1998 were F. R.
Lehman, Chairman, Hugo E. Braun, Jr., Leo B. Corwin, Lee A. Shobe and Charles
R. Weeks. This Committee met four times during 1998. Among its various
responsibilities, the Committee recommends nominees for election as directors
at the Annual Meeting of Stockholders and individuals to fill vacancies which
may occur between annual meetings. The Committee will consider as potential
nominees persons recommended by stockholders. Such recommendations should
include a personal biography of the suggested nominee, an indication of the
background or experience that qualifies such person for consideration, and a
statement that such person has agreed to serve if nominated and elected.
How are directors compensated?
Directors who are not full-time employees received a fee of $16,000
($19,000 for each Chairman of a Committee) for 1998, plus reimbursement for
travel expenses to attend meetings of the Board of Directors. On April 24,
1998, each of the current directors with the exception of James L. Wolohan,
were granted an option under the Stock Option Plan for Non-Employee Directors
to purchase 1,000 shares of Common Stock at an option price of $13.125 per
share. The option price was equal to the closing market price on the date of
grant.
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Board of Directors (the "Committee")
is composed of three outside directors and is responsible for developing and
making recommendations to the Board of Directors with respect to the
Company's executive compensation policies. In addition, the Compensation
Committee, pursuant to authority delegated by the Board, determines on an
annual basis the compensation to be paid to the chief executive officer and
each of the other officers of the Company.
The Committee has available to it an outside compensation consultant
and access to independent compensation data.
The Company's compensation policy for officers is designed to support
the overall objective of enhancing value for stockholders by attracting,
developing, rewarding, and retaining highly qualified and productive
individuals; relating compensation to both Company and individual
performance; and ensuring compensation levels that are externally competitive
and internally equitable.
The key elements of the Company officers' compensation consist of base
salary, potential bonus awards under the Cash Incentive Compensation Program
based on overall Company performance and the award of Performance Shares and
stock options under the Long-Term Incentive Plan which give the officers the
5
opportunity to earn long-term stock based incentives. The Compensation
Committee's policies with respect to each of these elements, including the
bases for the compensation awarded to Mr. Wolohan, the Company's chief
executive officer, are discussed below. In addition, while the elements of
compensation described below are considered separately, the Compensation
Committee takes into account the full compensation package afforded by the
Company to the individual.
Base Salary
Each officer's salary is reviewed annually. In determining appropriate
salary levels, consideration is given to the scope of responsibility,
experience, Company and individual performance as well as pay practices of
other companies relating to executives of similar responsibility.
With respect to the base salary of Mr. Wolohan in 1998, consideration
was given to a comparison of base salaries of chief executive officers of
peer companies, and an assessment of Mr. Wolohan's individual performance.
Mr. Wolohan's base salary of $222,000 for 1998 remained the same as his 1997
base salary.
Cash Incentive Compensation Program
To emphasize the creation of value for stockholders, the Company
adopted the EVA(TM) (Economic Value Added) concept in 1997 to replace the
Cash Profit-Sharing/Incentive Program. The concept is a better way to
evaluate Company and individual market performance. Accordingly, incentive
compensation for 1998 was based on the principles of EVA(TM).
Incentives for operating management are based on the results of the
individual market(s) supervised. Factors which determined the amount of
incentive are: (1) net operating profit after tax, (2) return on net
controllable assets, and (3) the improvement in return on net controllable
assets. Incentives for middle management corporate office staff are based on
the summation of results for all markets using the same factors as operating
management.
Incentives for senior management are based on total Company
performance. Annually an incentive pool is created based on a percentage of
the change in EVA(TM) between years. The pool is allocated among senior
management based on job responsibilities. To add a long-term decision-making
horizon to the program, a "bank account" is included in the incentive plan
with a portion of the incentive paid annually and the balance paid out over
time. Unless otherwise determined by the Compensation Committee, no payments
are made under the program unless a specific performance base is met. For
1998 no payments were made under the program since a specific performance
base was not met.
Long-Term Incentive Plan
The purpose of the Long-Term Incentive Plan of the Company is to: (i)
strengthen the commonality of interest between management and the Company's
stockholders, (ii) provide strong incentives and rewards for key employees to
accomplish the Company's long term goals and objectives, (iii) attract and
retain employees of high caliber and ability, and (iv) offer, in combination
with base salaries, other incentives and benefits, a comprehensive and
competitive total compensation program. The Plan provides for the award of
Performance Shares as well as stock options.
Performance Shares. The program for 1998 was composed of various tiers
with each participant assigned to a tier upon the basis of the participant's
job responsibilities. Performance Shares are based on return on investment
and/or individual performance objectives. For job responsibilities there is
specified the number of Performance Shares which will be awarded a
participant if specified return on investment and/or individual performance
objectives are achieved.
6
Stock Options. Under the Long-Term Incentive Plan, stock options may be
granted, from time to time, to officers and key employees of the Company. The
number of options granted is determined by subjective evaluation of the
person's ability to influence the Company's long-term growth and
profitability. Stock options are granted with an exercise price equal to the
market price of the Common Stock on the date of grant.
The Committee believes that linking executive compensation to corporate
performance results in a better alignment of compensation with corporate
goals and stockholder interest. As performance goals are met or exceeded,
resulting in increased value to stockholders, executives are rewarded
commensurately. The Committee believes that compensation levels during 1998
adequately reflect the Company's compensation goals and policies.
Compensation Committee
CHARLES R. WEEKS, Chairman
HUGO E. BRAUN, JR.
F. R. LEHMAN
EXECUTIVE COMPENSATION
The following summary compensation table sets forth information with
respect to the compensation of the Chief Executive Officer and the named
executive officers of the Company.
Summary Compensation Table
Long-Term
Compensation
Annual Compensation(1) Awards
------------------------- ------------
Number of
Securities
Name and Underlying
Principal Bonus Options/ All Other
Position Year Salary (2) Granted(3) Compensation(4)
--------- ---- ------ ----- ----------- ---------------
James L. Wolohan 1998 $222,000 -0- $75,000 $ 7,586
Chairman of the Board, 1997 222,000 -0- -0- 10,132
President and Chief Executive Officer 1996 222,000 37,296 -0- 9,782
David G. Honaman 1998 122,000 -0- 25,000 4,441
Vice President -- Administration, 1997 120,000 -0- -0- 4,736
Secretary and Chief Financial Officer 1996 116,000 16,240 -0- 4,740
Curtis J. LeMaster 1998 120,000 -0- 25,000 2,692
Vice President -- Purchasing, 1997 100,000 -0- -0- 2,585
Marketing and Systems 1996 80,333 10,600 -0- 2,114
John A. Sieggreen (5) 1998 125,000 -0- 35,000 2,525
Vice President -- Operations 1997 70,238 25,000(5) 5,000 1,187
<FN>
(1) The aggregate amount of perquisites and other personal benefits for any
named executive does not exceed $50,000 or 10% of the total of annual
salary and bonus for any such named executive, and is therefore, not
reflected in the table.
7
(2) Amounts paid under the former Cash Incentive Compensation Program.
(3) Represents the number of stock options granted under the Company's
Long-Term Incentive Plan.
(4) This column includes the Company's contributions to the Deferred Profit
Sharing Plan and Supplemental Executive Retirement Program as well as
dividends paid on outstanding Performance Shares under the Company's
Long-Term Incentive Plans. The Company's 1998 contribution to the
Deferred Profit Sharing Plan was as follows: Mr. Wolohan -- $2,100; Mr.
Honaman -- $1,600; Mr. LeMaster -- $1,600; and Mr. Sieggreen -- $2,000.
It also includes for Mr. Wolohan a contribution in 1998 to the
Supplemental Executive Retirement Program of $800 as well as dividends
paid on outstanding Performance Shares during 1998 under the Company's
Long-Term Incentive Plans as follows: Mr. Wolohan -- $4,684; Mr. Honaman
-- $2,843; Mr. LeMaster -- $1,120; and Mr. Sieggreen -- $560.
(5) Mr. Sieggreen joined the Company on April 22, 1997. The bonus paid to Mr.
Sieggreen in 1997 was part of his guaranteed employment compensation
package.
Long-Term Incentive Plan -- Awards in 1998
The following table sets forth information with respect to awards of
Performance Shares under the Long-Term Incentive Plan during 1998 to the
following executive officers named in the Summary Compensation Table.
Performance or Estimated
Number of Other Period Until Future Payouts
Performance Maturation ----------------------------
Name Shares Awarded or Payout(1) Threshold Target Maximum
---- -------------- ------------------ --------- ------ -------
James L. Wolohan ................ 3,000 1/1/2009 3,000 3,000 3,000
David G. Honaman ................ 1,500 1/1/2009 1,500 1,500 1,500
Curtis J. LeMaster .............. 1,500 1/1/2009 1,500 1,500 1,500
John A. Sieggreen ............... 1,500 1/1/2009 1,500 1,500 1,500
<FN>
(1) These Performance Shares may be fully earned by January 1, 2004 and shall
be deliverable to the participant on January 1, 2009.
Performance Shares when awarded are earned by a participant based on
the achievement of performance goals and/or individual performance objectives
at the end of the stated performance period and the participant's continued
employment after such period. Such shares as to which performance goals
and/or individual performance objectives have been met shall be deemed earned
by the participant in increments of twenty percent per year for each year
after the end of the stated performance period, so that by the end of the
fifth year after the end of the stated performance period, the participant
will have fully earned the Performance Shares.
Performance Shares shall be distributed to participants in the form of
one share of the Company's Common Stock for each Performance Share earned. In
lieu of immediate issuance of shares of Common Stock upon being earned, the
Compensation Committee shall defer the delivery of such shares for a period
of five years after the date all of the Performance Shares become 100%
earned; provided, however, in the event of termination of employment by the
participant during such five year period, all such shares not yet distributed
shall be delivered to or on behalf of the participant.
8
Under the Long-Term Incentive Plan the following executive officers
named in the Summary Compensation Table are vested and unvested with the
following number of Performance Shares having the following aggregate values
based on the last sales price of the Common Stock of the Company on the
NASDAQ National Market System on December 26, 1998:
Performance Shares Performance Shares
Vested Unvested
------------------ ------------------
Name Number Value Number Value
---- ------ ----- ------ -----
James L. Wolohan ....... 8,264 $107,432 7,676 $99,788
David G. Honaman ....... 5,206 67,673 3,916 50,913
Curtis J. LeMaster ..... 1,500 19,500 4,000 52,000
John A. Sieggreen ...... 400 5,200 3,100 40,300
Shares of the Company's Common Stock as to which performance goals
and/or individual performance objectives have been met have full dividend
rights with respect to dividends declared after such goals and/or objectives
have been met, with such dividends being paid directly to the participant.
Under the prior Long-Term Incentive Plan which terminated on December
31, 1990 except as to Performance Shares outstanding thereunder, the above
named officers are vested with the following number of Performance Shares
having the following aggregate values as determined above on December 26,
1998: Mr. Wolohan -- 3,795 shares --$49,335 and Mr. Honaman -- 2,530 shares
- -- $32,890.
Options/SAR Grants During 1998
The following table sets forth information on stock options granted
during 1998 under the Company's Long-Term Incentive Plan to the executive
officers named in the Summary Compensation Table.
Individual Grants
------------------------------------------------
Percent of Potential Realizable
Total Value at Assumed Rates
Number of Options of Stock Price
Securities Granted to Exercise Appreciation for Option
Underlying Employees Price Term(4)
Options/SARS during Per Expiration -----------------------
Name Granted(1) 1998(2) Share(3) Date 5% 10%
---- ------------ --------- -------- ---------- ------ ------
James L. Wolohan ........ 75,000 38.2 $13.13 4/20/2008 $21.40 $34.01
David G. Honaman ........ 25,000 12.7 13.13 4/20/2008 21.40 34.01
Curtis J. LeMaster ...... 25,000 12.7 13.13 4/20/2008 21.40 34.01
John A. Sieggreen ....... 35,000 17.8 13.13 4/20/2008 21.40 34.01
<FN>
(1) The Long-Term Incentive Plan does not provide for the grant of SARs.
(2) The Company granted options aggregating 196,400 shares to officers and
key employees during 1998.
(3) The exercise price may be paid by delivery of already-owned shares.
(4) As required by rules of the Securities and Exchange Commission, potential
values stated are based on the prescribed assumption that the Company's
Common Stock will appreciate in value from the date of grant to the end
of the option term at annualized rates of 5% and 10% (total appreciation
of 63% and 159%) respectively, and therefore are not intended to forecast
possible future appreciation, if any, in the price of the Company's
Common Stock.
9
Year-End Option Values
The following table sets forth certain information on the number of
stock options remaining unexercised at December 26, 1998 by the executive
officers named in the Summary Compensation Table and the value of such
options at December 26, 1998. No options were exercised during 1998 by such
executive officers.
Number of
Securities Underlying Value of Unexercised
Shares Value Unexercised Options In-the-Money Stock Options
Acquired Realized at December 26, 1998 at December 26, 1998
on at --------------------------- ---------------------------
Name Exercise Exercise Exercisable Unexercisable Exercisable Unexercisable
---- -------- -------- ----------- ------------- ----------- -------------
James L. Wolohan ...... -0- -0- 30,000 75,000 $37,500 -0-
David G. Honaman ...... -0- -0- 16,000 25,000 22,500 -0-
Curtis J. LeMaster .... -0- -0- 3,000 25,000 11,250 -0-
John A. Sieggreen ..... -0- -0- 5,000 35,000 5,000 -0-
Performance Graph
The following graph compares the change in the Company's cumulative
total stockholder return on its Common Stock with the NASDAQ Stock Market
(U.S. Companies) and the NASDAQ Retail Trade Stocks.
Comparison of Five-Year Cumulative Total Return
[ PROXY CHART ]
Assuming $100 Invested on 12/31/93
with Dividends Reinvested
31-Dec-93 31-Dec-94 31-Dec-95 31-Dec-96 31-Dec-97 31-Dec-98
--------- --------- --------- --------- --------- ---------
Wolohan Lumber Co. 100.00 88.6 59.8 77.3 82.6 83.5
NASDAQ Stock Market
(U.S. Companies) 100.0 97.8 138.3 170.0 208.6 293.2
NASDAW Retail Trade
Stocks 100.0 91.2 100.4 119.7 140.7 170.2
10
SELECTION OF INDEPENDENT AUDITORS
Rehmann Robson PC has been appointed as independent auditors to audit
the Company's financial statements for the year 1999 by the Board of
Directors of the Company upon the recommendation of the Audit Committee of
the Board of Directors. Representatives of Rehmann Robson PC will be present
at the Annual Meeting of Stockholders, will have the opportunity to make a
statement if they desire to do so and will be available to respond to
appropriate questions by stockholders.
MISCELLANEOUS
It is not expected that any other matters are likely to be brought
before the meeting. However, if any other matters be presented, it is the
intention of the persons named in the proxy to vote the proxy in accordance
with their best judgment.
The entire cost of preparing and mailing the proxy material will be
borne by the Company. Solicitation of proxies will be made by mail,
personally, or by telephone, by officers, directors and regular employees of
the Company. The Company will request brokerage houses and other custodians,
nominees and fiduciaries to forward soliciting material to the stockholders
and the Company will reimburse such institutions for their out-of-pocket
expenses incurred thereby.
It is important that proxies be returned promptly to avoid unnecessary
expense. Therefore, whether you plan to attend or not, you are urged
regardless of the number of shares of stock owned, to date, sign and return
the enclosed Proxy Card promptly.
Stockholders Proposals Pursuant to the General Rules under the
Securities Exchange Act of 1934, proposals of stockholders intended to be
presented to the 2000 Annual Meeting of Stockholders must be received by the
Secretary of the Company at the executive offices on or before November 27,
1999.
By Order of the Board of Directors,
DAVID G. HONAMAN, Secretary
11
[Form of Proxy -- Front]
WOLOHAN LUMBER CO.
Proxy Solicited by the Board of Directors for the
Annual Meeting of Stockholders
to Be Held April 29, 1999
The undersigned hereby appoints JAMES L. WOLOHAN and DAVID G. HONAMAN, or
either of them, with power of substitution in each, Proxies to vote all Common
Stock of the undersigned in Wolohan Lumber Co., at the Annual Meeting of
Stockholders to be held on April 29, 1999, and at all adjournments thereof.
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PLEASE VOTE, DATE AND SIGN ON REVERSE
AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
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Please sign exactly as your name(s) appear(s) hereon. Joint owners should
each sign personally. Trustees and other fiduciaries should indicate the
capacity in which they sign, and where more than one name appears, a
majority must sign. If a corporation, the signature should be that of an
authorized officer who should state his or her title.
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HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
_____________________________________ _______________________________________
_____________________________________ _______________________________________
_____________________________________ _______________________________________
[Form of Proxy -- Back]
/X/ PLEASE MARK VOTES
AS IN THIS EXAMPLE For All With- For All
Nominees hold Except
- ------------------------- 1. Election of Directors / / / / / /
WOLOHAN LUMBER CO. Nominees as Directors:
- -------------------------
Unless otherwise specified, the Proxies are appointed Hugo E. Braun, Jr. Charles R. Weeks
to vote FOR the Election of all Directors. James L. Wolohan Lee A. Shobe
Leo B. Corwin
RECORD DATE SHARES:
NOTE: If you do not wish your shares voted "For" a
particular nominee, mark the "For All Except" box and
strike a line through the name(s) of the nominee(s). Your
shares will be voted for the remaining nominee(s).
2. In their discretion, the Proxies are authorized to vote
upon such other matters as may properly come before the
meeting.
Please be sure to sign and / /
date this Proxy. / Date / Mark box at right if an address change or comment / /
- --------------------------------------------------------/ has been noted on the reverse side of this card.
/ /
/ /
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Stockholder(s) sign here Co-owner sign here
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DETACH CARD DETACH CARD