UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934. FOR FISCAL YEAR ENDED DECEMBER 26, 1998.

( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934. For the transition period from to
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Commission File No.: 0-22684

UNIVERSAL FOREST PRODUCTS, INC.
(Exact name of registrant as specified in its charter)

MICHIGAN 38-1465835
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

2801 E. BELTLINE, N.E., GRAND RAPIDS, MICHIGAN 49525
(Address of principal executive offices) (Zip Code)

(616) 364-6161
(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each Class Name of each exchange on which registered
NONE
-----------------------------------------
Securities registered pursuant to Section 12(g) of the Act:

COMMON STOCK, NO PAR VALUE
(Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13, or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes: X No:
----- -----

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]

As of March 1, 1999, 20,715,500 shares of the registrant's common stock, no par
value, were outstanding. The aggregate market value of the common stock held by
non-affiliates of the registrant (i.e., excluding shares held by executive
officers, directors, and control persons as defined in Rule 405, 17 CFR 230.405)
on that date was $248,981,932 computed at the closing price of $20.125 on that
date.

Documents incorporated by reference:

(1) Certain portions of the Company's Annual Report to Shareholders for the
fiscal year ended December 26, 1998 are incorporated by reference into
Part II of this Report.

(2) Certain portions of the Company's Proxy Statement for its 1999 Annual
Meeting of Shareholders are incorporated by reference into Part III of
this Report.

Exhibit Index located on page E-1.
Page 1 of 18

ANNUAL REPORT ON FORM 10-K

DECEMBER 26, 1998

TABLE OF CONTENTS

PAGE
----

PART I

Item 1. Business. 3
Item 2. Properties. 11
Item 3. Legal Proceedings. 11
Item 4. Submission of Matters to a Vote of Security Holders. 11

PART II

Item 5. Market for the Registrant's Common Equity and Related 14
Shareholder Matters.
Item 6. Selected Financial Data. 14
Item 7. Management's Discussion and Analysis of Financial 14
Condition and Results of Operations.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. 14
Item 8. Financial Statements and Supplemental Data. 14
Item 9. Changes in and Disagreements with Accountants on 15
Accounting and Financial Disclosure.

PART III

Item 10. Directors and Executive Officers of the Registrant. 15
Item 11. Executive Compensation. 15
Item 12. Security Ownership of Certain Beneficial Owners 15
and Management.
Item 13. Certain Relationships and Related Transactions. 15

PART IV

Item 14. Exhibits, Financial Statement Schedules, and Reports 15
on Form 8-K.

PART I

ITEM 1. BUSINESS.

(A) GENERAL DEVELOPMENT OF THE BUSINESS.

Universal Forest Products(R), Inc., and its wholly-owned and
majority-owned subsidiaries and affiliates ("the Company") manufactures, treats
and distributes lumber products for the do-it-yourself (DIY), manufactured
housing, industrial and site-built construction markets. The Company currently
operates 66 manufacturing and treating facilities throughout the United States,
Canada and Mexico.

Universal Forest Products(R), Inc. was organized as a Michigan
corporation in 1955. The Company's business originally consisted of purchasing
lumber in carload lots from primary producers and reselling those carloads
mostly to manufacturers of mobile and modular homes, without any intermediate
handling. In the early 1970's, producers of manufactured housing were
experiencing supply and inventory difficulties as a result of the deterioration
of railroad service and rapidly increasing interest rates. The Company's
management recognized these customer-experienced problems as an opportunity. As
a result, the Company developed a "component yard" concept that featured
distribution facilities with manufacturing capabilities located on major rail
routes in close proximity to its clustered manufactured housing customers.
Carload shipments of lumber were received at these regional facilities where the
material was either broken down and shipped to customers without further
processing, or manufactured to the customer's specifications before shipment to
the customer by truck. The component yard concept helped the Company's customers
reduce materials management problems, control their inventory and labor costs
and conserve capital. As the component yard concept evolved, the Company began
to manufacture roof trusses for its manufactured housing customers. The Company
believes it was the first truss supplier to employ a full-time staff of
engineers who assist customers with truss designs, help obtain various building
code approvals for these designs and facilitate the development of new products
and manufacturing techniques. As consequence, the Company's sales to the
manufactured housing industry grew rapidly through the 1970's and 1980's. Today,
the Company is the largest manufacturer of roof trusses for manufactured homes
in the nation.

In order to further enhance growth opportunities, the Company entered the
wood preservation business in 1979. The Company utilizes a pressure-treatment
process for protecting wood from damage by insects and fungi in outdoor
applications. The expansion into this product line led to the manufacture of a
variety of products, primarily for landscaping, deck and fence construction.
These products were originally sold to conventional lumberyards and small
lumberyard chains. When the warehouse-format mass merchandisers such as Home
Depot became strong retail outlets for the DIY market in the late 1980's, the
Company was well positioned to capture the business of these retailers. By
virtue of the geographic dispersal of its regional facilities and its prior
experience with the flexibility required for the delivery of mixed truckloads of
products on a just-in-time basis, the Company possessed the abilities demanded
by the DIY retailers. The Company has grown to become the number one supplier of
lumber related products to the DIY market.

In the mid-1980's, management began to recognize opportunities in the
industrial market. The Company manufactures pallets, crating stock and specialty
packaging for large industrial manufacturers and agricultural customers. These
products may be manufactured from the by-product of other manufactured products,
providing the Company with a profitable way of expanding its business while
increasing its raw material yields. In 1998, the Company completed the following
business acquisitions to expand its market presence:

- - On April 14, 1998, a subsidiary of the Company acquired substantially all of
the assets and assumed certain liabilities of Atlantic General Packaging,
Inc. ("AGP"), a manufacturer of specialty wood packaging products. AGP
operates one facility in Warrenton, North Carolina. The total purchase price
for the net assets of AGP was comprised of cash totaling approximately $1.0
million, a note payable of $857,000, and 57,950 shares of the Company's
common stock. AGP had net sales in fiscal 1997 totaling $4 million.

- - On June 4, 1998, a subsidiary of the Company acquired substantially all of
the assets of Industrial Lumber Company, Inc. ("ILC"), a distributor of low
grade cut lumber for packaging. The total purchase price for the net assets
of ILC was comprised of cash totaling approximately $3.0 million and notes
payable totaling $2.2 million. ILC had net sales in fiscal 1997 totaling $15
million.

Beginning in December of 1997, the Company added another market to its
business, the site-built construction market, through five strategic business
acquisitions. The Company acquired manufacturers of engineered wood products,
which consist of roof and floor trusses, wall panels and I-joists. The customer
base of these manufacturers consists of large, multi-tract builders, small
volume custom builders, national home center customers and retail lumberyards.
As a result of these business acquisitions, the Company has become the largest
manufacturer of engineered trusses and wall panels in the nation. Each of the
Company's business acquisitions are discussed below.

- - On December 22, 1997, a subsidiary of the Company completed a merger with
Consolidated Building Components, Inc. ("CBC"), a manufacturer of engineered
trusses, wall panels and other products for commercial and residential
builders and producers of manufactured homes. CBC operates two plants in
Northwest Pennsylvania. The Company issued approximately 398,000 shares of
its common stock in exchange for all of the stock of CBC. This transaction
has been accounted for as a pooling of interests; therefore, financial
statements for 1996 and prior years were restated to reflect this merger. CBC
had net sales in fiscal 1997 totaling $24 million.

- - On December 29, 1997, a partnership of the Company acquired substantially all
of the assets of Structural Lumber Products, Inc. ("SLP"), a manufacturer of
engineered trusses and wall panels for residential builders. SLP operates
plants in San Antonio, Austin and Dallas, Texas. The total purchase price of
the transaction was $18.5 million. SLP had net sales in fiscal 1997 totaling
$22 million.

- - On March 30, 1998, a subsidiary of the Company acquired 100% of the
outstanding shares of privately held Shoffner Industries, Inc. ("Shoffner")
in exchange for $41.1 million in cash and 3 million shares of the Company's
common stock. Shoffner is a manufacturer of engineered trusses

for commercial and residential builders and had 14 facilities in 7 states at
the time of the acquisition. Shoffner had net sales in fiscal 1997 totaling
$90 million.

- - On April 20, 1998, a subsidiary of the Company acquired substantially all of
the assets and assumed certain liabilities of Advanced Component Systems,
Inc. ("ACS"), a manufacturer of engineered trusses for commercial and
residential builders. ACS operates one facility in Lafayette, Colorado. The
total purchase price of ACS was $27 million. ACS had net sales in fiscal 1997
totaling $39 million.

- - On November 4, 1998, a subsidiary of the Company acquired 59% of the
outstanding shares of Nascor, Inc. ("Nascor"), located in Calgary, Alberta.
Nascor manufactures engineered trusses, I-joists and pre-insulated wall
panels for commercial and residential builders. In addition, Nascor conducts
licensing activities associated with its I-joist technology. The total
purchase price for the shares was $2.8 million. Nascor had sales and
licensing revenues totaling $13 million in 1998.

In addition, on December 18, 1998, a subsidiary of the Company acquired
45% of the outstanding shares of Pino Exporta S.A. de C.V., which subsequently
changed its name to Pinelli Universal S. de R.L. de C.V. ("Pinelli"). Pinelli is
located in Durango, Mexico, where it manufactures moulding and millwork products
for customers in the United States. The total purchase price for the minority
interest was $3.0 million. In addition, the Company will provide a revolving
credit facility to Pinelli totaling up to $5.0 million. The Company advanced
$3.2 million to Pinelli on December 18, 1998. The Company has accounted for this
investment using the equity method.

(B) FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS.

The information required by this item is incorporated by reference from
Footnote O of the Consolidated Financial Statements included in the Company's
Annual Report to Shareholders for the fiscal year ended December 26, 1998.

The Company presently manufactures, treats and distributes lumber
products for the DIY, manufactured housing, industrial and site-built
construction markets. Each of these markets is discussed in the paragraphs which
follow. The Company also sells lumber products to the wholesale market, but
management is not emphasizing this business in its growth objectives.

DIY MARKET. The customers comprising this market are primarily national
home center retailers, chain lumberyards and contractor oriented lumberyards.
The Company is currently selling to over 1,900 customers in this market. One
customer, The Home Depot, Inc., accounted for approximately 20%, 18% and 15% of
the Company's total net sales for fiscal 1998, 1997 and 1996, respectively.

National customers in this market are serviced by the Company's sales
staff in each region and are assisted by personnel from the Company's
headquarters. Generally, terms of sale are established for annual periods, and
orders are thereafter placed with the Company's regional facilities in
accordance with the pre-established terms.

The Company currently supplies customers in this market from over 50 of
its locations. These regional facilities are able to supply customers with mixed
truckloads of products which can be delivered to customers with rapid turnaround
from order receipt. Freight costs are a factor in the ability to competitively
service this market, especially with treated wood products because of their
heavier weight. The proximity of the Company's regional facilities to the
various outlets of these customers is a significant advantage when negotiating
annual sales programs.

The products offered to customers in this market include dimension lumber
(both preserved and unpreserved) and various "value-added products," some of
which are sold under the Company's trademarks. Treated lumber is sold under the
Company's PRO-WOOD(R) trademark. Value-added products, described in the
following paragraph, may be preserved by pressure-treatment or unpreserved.

Products in the Deck Necessities(R) group consist of decking, balusters,
spindles, decorative posts, handrails, stair risers, stringers and treads. The
Fence Fundamentals(TM) group of products includes various styles of fences, such
as solid, picket and shadowbox, as well as gates, posts and other components.
Products in the Outdoor Essentials(TM) group consist of various home and garden
and landscaping items. Large volumes of lattice are sold by the Company under
its Lattice Basics(TM) trademark for use as skirting on decks, trellises and
various outdoor home improvement projects. The Storage Solutions(TM) product
line consists primarily of storage building frames and trusses. In 1998, the
Company sold all of the inventory, machinery and equipment relating to its
YardLine(R) storage structure product.

The Company also sells engineered wood products to this market as a
result of recent business acquisitions. These products include engineered
trusses, wall panels and I-joists. Depending upon regional practices and builder
preferences, the Company may sell these products through retailers or directly
to builders (see Site-Built Construction below).

The Company knows of no competitor that currently manufactures, treats
and distributes a full line of both value-added and commodity products on a
national basis. The Company faces competition on individual products from
several different producers, but the majority of these competitors tend to be
regional in their efforts and/or do not offer a full line of outdoor lumber
products. The Company also faces increased competition in this market from
certain national vendor mills with wood preservation facilities in certain
regions. The Company believes the breadth of its product offering, its
geographic dispersion and proximity of its plants to core customers, its
purchasing expertise, and its service capabilities provide significant
competitive advantages in this market. As this industry continues to
consolidate, the Company believes it is well-positioned to capture additional
market share.

MANUFACTURED HOUSING MARKET. The customers comprising the manufactured
housing market are producers of mobile, modular and prefabricated homes and
recreational vehicles. The Company is currently selling to over 200 customers in
this market.

Products sold to customers in this market consist primarily of roof
trusses, lumber cut and shaped to the customer's specification, plywood,
particle board, and dimension lumber, all intended for use in the construction
of manufactured housing. Sales are made by personnel located at each regional
facility based on customer orders. The Company's engineering and support staff
of approximately 15 persons acts as a sales support resource to assist the
customer with truss designs, obtaining various building code approvals for the
designs, and aiding in the development of new products and manufacturing
processes.

While no competitor operates in as widely dispersed geographic area as
the Company, it does face vigorous competition from suppliers in many geographic
regions. The Company estimates that it produces over 65% of the HUD Code roof
trusses supplied to this market based on data published by the Manufactured
Housing Institute. The Company's principal competitive advantages include its
product knowledge, the capacity to supply all of the customer's lumber
requirements, the ability to deliver engineering support services, the proximity
of its regional facilities to core customers and its ability to provide national
sales programs to certain customers. In addition, the Company's financial
resources enable it to carry a sufficient inventory of raw materials to minimize
turnaround time from receipt of an order to delivery of the product.

INDUSTRIAL MARKET. The Company defines its industrial market as
industrial manufacturers and agricultural customers who use pallets, crates, and
wooden boxes for packaging, shipping and material handling purposes. The Company
has increased its emphasis on this market in recent years and currently sells to
over 1,400 customers in this market. Many of the products sold to this market
may be produced from the by-product of other manufactured products, thereby
allowing the Company to increase its raw material yields while expanding its
business. Competition is fragmented and includes virtually every supplier of
lumber convenient to the customer. The Company intends to continue to service
this market with its regional sales personnel and to emphasize service and
reliability as competitive strengths. It also plans to continue to increase its
market share through internal expansion utilizing technology acquired from AGP
and strategic business acquisitions.

SITE-BUILT CONSTRUCTION MARKET. The Company entered the site-built
construction market through five strategic business acquisitions completed since
December of 1997. The businesses acquired are discussed herein under the section
"General Development of the Business."

The customers comprising this market are primarily large-volume,
multitract builders/ developers and smaller custom builders. The Company is
currently selling to over 1,600 customers in this market. Customers are serviced
by the Company's sales, engineering and design personnel in each region.
Generally, terms of sale and pricing are determined based on quotes for each
specific job order.

The Company currently supplies customers in this market from 20
facilities located in 10 different states. These facilities manufacture various
engineered wood products used to frame a conventional site-built project,
including roof and floor trusses, wall panels and I-joists. Freight costs are a
factor in the ability to competitively service this market due to the space
requirements of these products on each truckload.

The Company knows of no competitor that manufactures and distributes a
complete line of engineered wood products on a national basis. Competition in
this market is fragmented as local regulatory requirements and product
preferences have resulted in a regional operating focus. The Company's objective
is to continue to grow its manufacturing capacity for this market while
developing a national presence. Management expects to face competition from
various companies attempting to complete the same strategy. The Company believes
its primary competitive advantages relate to its product knowledge, the
engineering and design capabilities of its regional staff, its product quality
and timeliness of delivery.

WOOD PRESERVATION TREATMENT. The Company is the largest producer of
preservative-treated lumber in the nation based on data published by the
Building Products Digest. The Company operates 17 treatment facilities in 12
different states, with capacity to process over one billion board feet annually.

The process for preserving wood utilized by the Company involves the
application of a Chromated Copper Arsenate (CCA) solution under pressure. This
process originated in India over sixty years ago as a means for protecting
timbers utilized in the construction of mine shafts and tunnels. The basic
process is no longer protected by any U.S. patent, and is widely used by
numerous producers of treated lumber. The process consists of mixing the
chemicals with water and impregnating the wood by alternating vacuum and
pressure in specially designed pressure chambers. Thereafter, the CCA becomes a
permanent component of the wood. The preservative in the wood acts as both an
insecticide and a fungicide, thereby effectively eliminating the two principal
causes of wood deterioration that exist in North America. The Company has
developed and implemented numerous refinements to the basic CCA treatment
process, and considers its process to be "state of the art."

In order to alleviate environmental concerns, in the mid-1980's the
Company began installing monitoring wells at all of its treating facilities
where groundwater contamination was a potential problem. Quality assurance
personnel from the Company's headquarters perform audits, including soil and
groundwater sampling at least semi-annually to assure that the treating process
is being performed in accordance with the Company's stringent standards for both
environmental safety and product quality.

At the time the monitoring wells were installed at the Company's Granger,
Indiana facility in 1986, chromium was discovered in the groundwater in excess
of the EPA limit for drinking water at one end of the Company's property.
Subsequent testing also revealed surface water and soil contamination in excess
of EPA limits in three other areas of the plant. The Company initiated a
voluntary remediation program. The extent of contamination was defined and a
remediation plan

was designed and implemented. This contamination was successfully remediated,
and the Company is currently conducting confirmatory sampling in accordance with
its agreement with the State of Indiana.

In 1991, the Company discovered chromium in the groundwater in excess of
the EPA drinking water limit in connection with the replacement of a treating
facility previously purchased in Union City, Georgia. A groundwater recovery
program in which large volumes of groundwater are pumped from the wells for use
in the Company's treatment process has corrected this problem.

The Company acquired several facilities from Chesapeake Corporation in
October 1993. Based on the agreements between the Company and Chesapeake
Corporation, the environmental conditions existing at the Elizabeth City, NC,
Stockertown, PA and North East, MD sites are the responsibility of the Company.
Environmental conditions consist of limited soil and/or groundwater
contamination of CCA components. Similarly, the Company purchased a treating
facility in Schertz, TX with limited soil contamination in December 1998. The
nature and extent of each of these conditions does not require immediate action.
If these sites are closed, some remedial action such as soil treatment and/or
removal may be required. Estimates of probable costs have been prepared for each
of these sites.

The Company has accrued for costs of remediation of all of its sites
totaling approximately $2.3 million at December 26, 1998. Except for the
situations described above, the Company is not aware of any material
environmental problems affecting its properties.

SEASONAL INFLUENCES. The Company's manufactured housing and site-built
construction markets are affected by seasonal influences in the northern states
during the winter months when installation and construction is more difficult.

The activities in the DIY market have substantial seasonal impacts. The
demand for many of the Company's DIY products is highest during the period of
April to August. Accordingly, its sales to the DIY market tend to be greater
during the second and third quarters. The Company builds its inventory of
finished goods throughout the winter and spring to support this sales peak.
Restraints on production capacity made this a necessary practice which
potentially exposed the Company to greater adverse effects of changes in
economic and industry trends. Since 1995, inventory management initiatives and
supply programs with vendors have been used to reduce the exposure to adverse
changes in the commodity lumber market, and decrease demands on cash resources.

SUPPLIERS. The Company is one of the largest domestic buyer of solid sawn
lumber from primary producers (lumber mills). It uses primarily southern yellow
pine in its pressure-treating operations, which it obtains from mills located
through the states comprising the sun belt. Other species used by the Company
include "spruce-pine-fir," from Ontario, Quebec, British Columbia, and Alberta,
Canada; hemlock, Douglas fir and cedar from the Pacific Northwest; inland
species of Ponderosa pine; and Brazilian pine. There are numerous primary
producers for all varieties used by the Company, and the Company is not
dependent on any particular source of supply. The Company's financial resources,
in combination with its strong sales network and ability to remanufacture

lumber, enable it to purchase a large percentage of a primary producer's output
(as opposed to only those dimensions or grades in immediate need), thereby
lowering its average cost of raw materials. Management believes this represents
a significant competitive advantage.

INTELLECTUAL PROPERTY. The Company owns a patent relating to automated
equipment for the manufacture of lattice, a tie-down strap patent related to
truss components, and a patent on machinery used in the production of joint
compound and wall texture. In addition, it owns four registered trademarks:
PRO-WOOD(R) relating to the preservative-treated wood products; Deck
Necessities(R) relating to the deck component products; the name Universal
Forest Products(R); and a pine tree logo. The Company has applied for an
additional registered trademark related to its ProFence(TM) products. In
addition, it claims common law trademark rights to several other trademarks of
lesser importance. While it believes its patent and trademark rights are
valuable, the loss of its patent or any trademark would not have a material
adverse impact on the competitive position of the Company.

RESEARCH AND DEVELOPMENT. Research and development efforts by the Company
generally fall into four categories: engineering and testing of new truss
designs; design and development of wood treatment systems and manufacturing
processes; design and development of machinery and tooling of various wood
shaping devices; and development of new products. Although important to the
Company's competitive strengths and growth, the dollar amount of research and
development expenditures has not typically been material to the Company.
However, in 1998, the Company spent approximately $2.8 million associated with
development of a new product. The Company is continuing its research activities
with respect to this product.

EMPLOYEES. At March 1, 1999, the Company employed approximately 4,400
persons. No Company employees are represented by a labor union, except for a
small facility located in Lerma, Mexico with approximately 20 employees. The
Company has never experienced a work stoppage due to a labor dispute, and
believes its relations with employees are good.

BACKLOG. Due to the nature of the Company's DIY, manufactured housing and
industrial businesses, backlog information is not meaningful. The maximum time
between receipt of a firm order and shipment does not usually exceed a few days.
Therefore, the Company would not normally have a backlog of unfilled orders in a
material amount. The relationships with its major customers are such that it is
either the exclusive supplier of certain products and/or certain geographic
areas, or the designated source for a specified portion of the customer's
requirements. In such cases, either the Company is able to forecast the
customer's requirements or the customer may provide an estimate of its future
needs. In neither case, however, will the Company receive firm orders until just
prior to the anticipated delivery dates for the products in question.

At March 1, 1999, backlog orders associated with the site-built
construction business, a new market for the Company, approximated $15.9 million,
representing approximately five weeks production. The Company believes the
relatively short time period associated with its backlog, in certain regions,
provides a significant competitive advantage.

(D) FINANCIAL INFORMATION ABOUT FOREIGN AND DOMESTIC OPERATIONS AND EXPORT
SALES.

The dominant portion of the Company's operations and sales occur in the
United States. Separate financial information about foreign and domestic
operations and export sales is incorporated by reference from Footnote O of the
Consolidated Financial Statements presented under Item 8 herein.

ITEM 2. PROPERTIES.

The Company's headquarters are located on a ten acre site adjacent to a
main thoroughfare in suburban Grand Rapids, Michigan. The headquarters building
consists of several one and two story structures of wood construction containing
approximately 49,000 square feet of office space.

The Company currently has 72 facilities at 63 locations. These facilities
are located in 23 U.S. states, two Canadian provinces, and two Mexican states,
and are involved in either the manufacture, preservative treatment, or
distribution of lumber products, or a combination of these activities. These
facilities are generally of steel frame and aluminum construction and situated
on fenced sites ranging in size from 7 acres to 48 acres. Depending upon
function and location, these facilities typically utilize office space between
1,500 and 5,000 square feet, manufacturing space between 10,000 and 105,000
square feet, treating space between 25,000 and 300,000 square feet, and covered
storage ranging from 10,000 to 100,000 square feet.

The Company owns all of its properties, free from any significant
mortgage or other encumbrance, except for 12 regional facilities which are
leased. The Company believes that all of these operating facilities are adequate
in capacity and condition to service existing customer locations.

ITEM 3. LEGAL PROCEEDINGS.

The Company is not involved in any pending legal proceedings other than
routine litigation incidental to the ordinary conduct of its business, none of
which would result in a material impact on the Company, individually or in the
aggregate, in the event of an adverse outcome.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

No matters were submitted to a vote of security holders during the fourth
quarter of fiscal year 1998.

ADDITIONAL ITEM: EXECUTIVE OFFICERS OF THE REGISTRANT.

The following table lists the names, ages and positions of all of the
Company's executive officers as of March 1, 1999. Executive officers are elected
annually by the Board of Directors at the first meeting of the Board following
the annual meeting of shareholders.

- -----------------------------------------------------------------------------------------------------------------
Name Age Position
- -----------------------------------------------------------------------------------------------------------------

Peter F. Secchia 61 Chairman of the Board, Universal Forest Products, Inc.
William G. Currie 51 Chief Executive Officer and President, Universal Forest Products, Inc.
James H. Ward 55 President, Universal Forest Products Eastern Division, Inc.
Michael B. Glenn 47 President, Universal Forest Products Western Division, Inc.
Robert K. Hill 51 Exec. Vice Pres. Operations, Universal Forest Products Western Division, Inc.
Robert D. Coleman 44 Exec. Vice Pres. Manufacturing, Universal Forest Products, Inc.
Philip E. Rogers 48 Exec. Vice Pres. National Sales and Marketing, Universal Forest Products, Inc.
Matthew J. Missad 38 Executive Vice President and Secretary, Universal Forest Products, Inc.
Elizabeth A. Nickels 36 Chief Financial Officer and Treasurer, Universal Forest Products, Inc.
Carroll M. Shoffner 66 Chairman, Shoffner Industries, L.L.C.
Gary A. Wright 51 President, Shoffner Industries, L.L.C.
Eric S. Maxey 40 Vice President of Administration, Universal Forest Products, Inc.
Jeff A. Higgs 44 Vice President, Universal Forest Products Western Division, Inc.

- -----------------------------------------------------------------------------------------------------------------

Peter F. Secchia, Chairman of the Board of Directors, began his service
with the Company in 1962 and has been a director of the Company since 1967. Mr.
Secchia served as President, Chief Executive Officer, and Chairman of the
Company from 1971 until 1989, when he was appointed U.S. Ambassador to Italy.
Mr. Secchia completed his tenure as Ambassador on January 20, 1993, when he
rejoined the Company as Chairman of the Board.

William G. Currie, the Chief Executive Officer and President of the
Company, joined the Company in 1971. From 1983 to 1990, Mr. Currie was President
of Universal Forest Products, Inc. and he was the President and Chief Executive
Officer of The Universal Companies, Inc. from 1989 until the merger to form the
Company in 1993.

James H. Ward joined the Company in 1972 as a regional salesman. From
1979 to 1987, he served as Vice President of the Company's Southern operations.
He was elected to Senior Vice President in June of 1987. Effective December 1,
1997, Mr. Ward became the President of the Universal Forest Products Eastern
Division.

Michael B. Glenn has been employed by the Company since 1974. In June of
1989, Mr. Glenn was elected Senior Vice President of the Company's Southwest
operations. From September 1983 to June 1989, Mr. Glenn was Vice President of
those operations. Effective December 1, 1997, Mr. Glenn became the President of
the Universal Forest Products Western Division.

Robert K. Hill has been with the Company since 1986. In March of 1993, he
was elected Senior Vice President of the Company's Far West operations. From
1989 to 1993, he served as Vice

President of those operations. Effective December 1, 1997, Mr. Hill became the
Executive Vice President of Operations of the Universal Forest Products Western
Division.

Robert D. Coleman, an employee of the Company since 1979, served as
Senior Vice President of the Company's Midwest operations from September 1, 1993
until December of 1997. From 1986 to 1993 he served as Vice President of the
Company's Atlantic Division. On December 1, 1997, Mr. Coleman became the
Executive Vice President of Manufacturing of the Universal Forest Products
Eastern Division. On January 1, 1999, Mr. Coleman was named the Executive Vice
President of Manufacturing for Universal Forest Products, Inc.

Philip E. Rogers, an employee of the Company since 1989, served as Vice
President of Operations for the Universal Forest Products Southwest Company
until November of 1997. At that time, Mr. Rogers became the Vice President of
Sales, National Accounts Retail. Effective January 1, 1999, Mr. Rogers was
promoted to Executive Vice President of National Sales and Marketing for
Universal Forest Products, Inc.

Matthew J. Missad has been employed by the Company since 1985. Mr. Missad
has served as General Counsel and Secretary since December 1, 1987, and Vice
President Corporate Compliance since August 1989. In February 1996, Mr. Missad
was promoted to Executive Vice President.

Elizabeth A. Nickels, CPA, joined the Company in July of 1993 as Chief
Financial Officer and Treasurer. From 1990 to 1993, Ms. Nickels served as Vice
President of Operations of The Waypointe Companies, Inc., a company involved in
construction, engineering, software design, and marketing. From 1986 to 1990,
Ms. Nickels served as Controller of Riebel Development Corporation. In February
1996, Ms. Nickels was promoted to Executive Vice President of Finance and
Administration.

Carroll M. Shoffner, has been affiliated with the Company since March 30,
1998, at which time the Company acquired Shoffner Industries, Inc., with whom he
had been employed since 1964. Mr. Shoffner serves as Chairman of Shoffner
Industries, L.L.C., and is a member of the Board of Directors of Universal
Forest Products, Inc.

Gary A. Wright, has been affiliated with the Company since March 30, 1998
at which time the Company acquired Shoffner Industries, Inc., with whom he had
been employed since 1978. Mr. Wright serves as President of Shoffner Industries,
L.L.C.

Eric S. Maxey, an employee of the Company since 1991, has served as Vice
President of Administration since 1992. Prior to that time and since 1984, he
served as Controller.

Jeff A. Higgs, has been an employee of the Company since April 20, 1998,
at which time the Company acquired the assets of Advanced Component Systems,
Inc. Mr. Higgs serves as a Vice President of Operations for the Universal Forest
Products Western Division, Inc.

PART II

The following information items in this Part II, which are contained in
the Registrant's Annual Report to Shareholders for the fiscal year ended
December 26, 1998, are specifically incorporated by reference into this Form
10-K Report. Selected portions of the Registrant's Annual Report to Shareholders
for the fiscal year ended December 26, 1998 are filed as Exhibit 13 with this
Form 10-K Report.

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS.

The information required by this Item is incorporated by reference from
the Company's Annual Report to Shareholders for the fiscal year ended December
26, 1998, under the caption "Price Range of Common Stock and Dividends."

ITEM 6. SELECTED FINANCIAL DATA.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

The information required by this Item is incorporated by reference from
the Company's Annual Report to Shareholders for the fiscal year ended December
26, 1998, under the following captions:

- "Independent Auditors' Report"
- "Consolidated Balance Sheets"
- "Consolidated Statements of Earnings"
- "Consolidated Statements of Shareholders' Equity"
- "Consolidated Statements of Cash Flows"
- "Notes to Consolidated Financial Statements"

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

Not applicable.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

Information relating to executive officers is included in this report in
the last Section of Part I under the Caption "Executive Officers of the
Registrant." Information relating to directors and compliance with Section 16(a)
of the Securities and Exchange Act of 1934 is incorporated by reference to the
Company's definitive Proxy Statement for the 1999 Annual Meeting of
Shareholders, as filed with the Commission, under the captions "Election of
Directors" and "Section 16(a) Beneficial Ownership Reporting Compliance."

ITEM 11. EXECUTIVE COMPENSATION.

Information relating to executive compensation is incorporated by
reference to the Company's definitive Proxy Statement for the 1999 Annual
Meeting of Shareholders under the caption "Executive Compensation," excluding
information under the captions "Compensation Committee Report" and "Stock
Performance Graph."

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

Information relating to security ownership of certain beneficial owners
and management is incorporated by reference to the Company's definitive Proxy
Statement for the 1999 Annual Meeting of Shareholders under the captions
"Ownership of Common Stock" and "Securities Ownership of Management."

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS.

Information relating to certain relationships and related party
transactions is incorporated by reference to the Company's definitive Proxy
Statement for the 1999 Annual Meeting of Shareholders under the caption
"Election of Directors."

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

(a) 1. Financial Statements. The following Independent Auditors' Report and
Consolidated Financial Statements are incorporated by reference, under Item 8 of
this report, from the Company's Annual Report to Shareholders for the fiscal
year ended December 26, 1998:

- Independent Auditors' Report

- Consolidated Balance Sheets as of December 26, 1998 and
December 27, 1997

- Consolidated Statements of Earnings for the Years
Ended December 26, 1998, December 27, 1997 and December
28, 1996

- Consolidated Statements of Shareholders' Equity for the Years
Ended December 26, 1998, December 27, 1997 and December
28, 1996

- Consolidated Statements of Cash Flows for the Years Ended
December 26, 1998, December 27, 1997 and December 28,
1996

- Notes to Consolidated Financial Statements

2. Financial Statement Schedules. All schedules required by this Form
10-K Report have been omitted because they were inapplicable, included in the
Consolidated Financial Statements or Notes to Consolidated Financial Statements,
or otherwise not required under instructions contained in Regulation S-X.

3. Exhibits. Reference is made to the Exhibit Index which is found on
pages E-1 through E-4 of this Form 10-K Report.

(b) No reports on Form 8-K were filed in the fourth quarter of 1998.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934 the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

Dated: March 25, 1999 UNIVERSAL FOREST PRODUCTS, INC.

By: /s/ PETER F. SECCHIA
------------------------------------------------
PETER F. SECCHIA, CHAIRMAN OF THE BOARD

and

/s/ WILLIAM G. CURRIE
------------------------------------------------
WILLIAM G. CURRIE, PRESIDENT AND CHIEF EXECUTIVE
OFFICER

and

/s/ ELIZABETH A. NICKELS
------------------------------------------------
ELIZABETH A. NICKELS, CHIEF FINANCIAL OFFICER
(PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER)

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below on this 25th day of March, 1999, by the following
persons on behalf of the Company and in the capacities indicated.

Each Director of the Company whose signature appears below hereby
appoints Matthew J. Missad and Elizabeth A. Nickels, and each of them
individually, as his attorney-in-fact to sign in his name and on his behalf as a
Director of the Company, and to file with the Commission any and all amendments
to this report on Form 10-K to the same extent and with the same effect as if
done personally.

/s/ PETER F. SECCHIA /s/ JOHN W. GARSIDE
- ------------------------------------ ------------------------------------
PETER F. SECCHIA, DIRECTOR JOHN W. GARSIDE, DIRECTOR

/s/ WILLIAM G. CURRIE /s/ PHILIP M. NOVELL
- ------------------------------------ ------------------------------------
WILLIAM G. CURRIE, DIRECTOR PHILIP M. NOVELL, DIRECTOR

/s/ RICHARD M. DEVOS /s/ LOUIS A. SMITH
- ------------------------------------ ------------------------------------
RICHARD M. DEVOS, DIRECTOR LOUIS A. SMITH, DIRECTOR

/s/ JOHN C. CANEPA /s/ CARROLL M. SHOFFNER
- ------------------------------------ ------------------------------------
JOHN C. CANEPA, DIRECTOR CARROLL M. SHOFFNER, DIRECTOR

EXHIBIT NO. DESCRIPTION
- ----------- -----------

2 An Agreement to acquire the Wood Treating Operations of Chesapeake
Corporation was filed as Exhibit 2 to a Registration Statement on
Form S-1 (No. 33-69474) and the same is incorporated herein by
reference.

2(a) A Lease Termination Agreement with Chesapeake Corporation dated
July 20, 1995 was filed as Exhibit 2(a) to a Form 10-Q Quarterly
Report for the quarter period ended July 1, 1995, and the same is
incorporated herein by reference.

2(b) Agreement and Plan of Reorganization dated as of March 30, 1998,
by and among Universal Forest Products, Inc., UFP Acquisition
Corp. II, Shoffner Industries, Inc. and the Shareholders of
Shoffner Industries, Inc., together with the Annexes thereto, was
filed as Exhibit 2.1 to a Form 8-K Report dated March 30, 1998,
and the same is incorporated herein by reference.

2(c) Purchase Agreement dated as of February 18, 1998, by and among
Universal Forest Products Southwest Company, Inc., Advanced
Component Systems, Inc., T.F. Investments, L.L.C., and F.T.G.
Leasing, Inc., was filed as Exhibit 2.1 to a Form 8-K Report dated
April 20, 1998, and the same is incorporated herein by reference.

3(a) Registrant's Articles of Incorporation were filed as Exhibit 3(a)
to a Registration Statement on Form S-1 (No. 33-69474) and the
same is incorporated herein by reference.

3(b) Registrant's Bylaws were filed as Exhibit 3(b) to a Registration
Statement on Form S-1 (No. 33-69474) and the same is incorporated
herein by reference.

4(a) Specimen form of Stock Certificate for Common Stock was filed as
Exhibit 4(a) to a Registration Statement on Form S-1 (No.
33-69474) and the same is incorporated herein by reference.

4(b)(1) Loan Agreement with Old Kent Bank and Trust Company dated April
18, 1988 was filed as Exhibit 4(b)(1) to a Registration Statement
on Form S-1 (No. 33-69474) and the same is incorporated herein by
reference.

4(b)(2) Business Loan Agreement with Michigan National Bank dated August
17, 1988, as amended was filed as Exhibit 4(b)(2) to a
Registration Statement on Form S-1 (No. 33- 69474) and the same is
incorporated herein by reference.

4(b)(3) Series A, Senior Unsecured Note Agreement dated May 5, 1994, was
filed as Exhibit 4(b)(3) to a Form 10-Q Quarterly Report for the
quarter period ended March 26, 1994, and the same is incorporated
herein by reference.

E-1

EXHIBIT NO. DESCRIPTION
- ----------- -----------

4(b)(4) First Amendment to Note Agreement dated November 13, 1998,
relating to Series A, Senior Unsecured Note Agreement dated May 5,
1994.

10(a) Redemption Agreement with Peter F. Secchia, dated August 26, 1993,
was filed as Exhibit 10(a) to a Registration Statement on Form S-1
(No. 33-69474) and the same is incorporated herein by reference.

10(b) Form of Indemnity Agreement entered into between the Registrant
and each of its directors was filed as Exhibit 10(b) to a
Registration Statement on Form S-1 (No. 33- 69474) and the same is
incorporated herein by reference.

10(c)(1) Lease guarantee dated April 26, 1978, given by Registrant on
behalf of Universal Restaurants, Inc. to Hol-Steak, Inc. was filed
as Exhibit 10(c)(1) to a Registration Statement on Form S-1 (No.
33-69474) and the same is incorporated herein by reference.

10(c)(2) Lease guarantee, dated March 10, 1978, given by Registrant on
behalf of Universal Restaurants, Inc. to Jackson Properties was
filed as Exhibit 10(c)(2) to a Registration Statement on Form S-1
(No. 33-69474) and the same is incorporated herein by reference.

10(c)(3) Lease guarantee, dated November 15, 1977, by Registrant on behalf
of Great Lakes Steak Company of Ann Arbor, Inc. to William C. and
Sally A. Martin was filed as Exhibit 10(c)(3) to a Registration
Statement on Form S-1 (No. 33-69474) and the same is incorporated
herein by reference.

10(c)(4) Lease guarantee, dated March 10, 1978, by Registrant on behalf of
Universal Restaurants, Inc. to Forbes/Cohen Properties was filed
as Exhibit 10(c)(4) to a Registration Statement on Form S-1 (No.
33-69474) and the same is incorporated herein by reference.

10(c)(5) Lease guarantee, dated April 26, 1978, by Registrant on behalf of
Universal Restaurants, Inc. to Dorr D. and Nettie R. Granger was
filed as Exhibit 10(c)(5) to a Registration Statement on Form S-1
(No. 33-69474) and the same is incorporated herein by reference.

10(d)(1) Lease between Registrant and its Employee Profit Sharing and
Retirement Trust Fund as lessor regarding Registrant's Shakopee,
Minnesota facility was filed as Exhibit 10(d)(1) to a Registration
Statement on Form S-1 (No. 33-69474) and the same is incorporated
herein by reference.

10(d)(2) Lease between Registrant and McIntosh Lumber Co. as lessor
regarding Registrant's Huntington Beach, California facility was
filed as Exhibit 10(d)(2) to a Registration Statement on Form S-1
(No. 33-69474) and the same is incorporated herein by reference.

E-2

EXHIBIT NO. DESCRIPTION
- ----------- -----------

10(d)(3) Sublease between Registrant and the Community Development
Authority of the City of Moreno Valley regarding Registrant's
Moreno Valley, California facility, with main lease attached was
filed as Exhibit 10(d)(3) to a Registration Statement on Form S-1
(No. 33- 69474) and the same is incorporated herein by reference.

10(d)(4) Lease between Registrant and Germania-Sykes as lessor regarding
land adjacent to Registrant's Moreno Valley facility was filed as
Exhibit 10(d)(4) to a Registration Statement on Form S-1 (No.
33-69474) and the same is incorporated herein by reference.

10(d)(5) Lease between Registrant and Niagara Industrial Mall, Inc. as
lessor regarding Registrant's Niagara, Ontario facility, as
amended was filed as Exhibit 10(d)(5) to a Registration Statement
on Form S-1 (No. 33-69474) and the same is incorporated herein by
reference.

*10(e)(1) Form of Executive Stock Option Agreement was filed as Exhibit
10(e)(1) to a Registration Statement on Form S-1 (No. 33-69474)
and the same is incorporated herein by reference.

*10(e)(2) Form of Officers' Stock Option Agreement was filed as Exhibit
10(e)(2) to a Registration Statement on Form S-1 (No. 33-69474)
and the same is incorporated herein by reference.

*10(f) Salaried Employee Bonus Plan was filed as Exhibit 10(f) to a
Registration Statement on Form S-1 (No. 33-69474) and the same is
incorporated herein by reference.

10(g)(1) Term Loan Agreement between Registrant and NBD Bank, N.A. dated
December 1, 1992, was filed as Exhibit 10(g)(1) to a Registration
Statement on Form S-1 (No. 33- 69474) and the same is incorporated
herein by reference.

10(g)(2) Promissory Note with Old Kent Bank and Trust Company, dated
September 1, 1993, was filed as Exhibit 10(g)(2) to a Registration
Statement on Form S-1 (No. 33-69474) and the same is incorporated
herein by reference.

10(g)(3) Installment Business Loan Note with NBD Bank, N.A. dated December
1, 1992, was filed as Exhibit 10(g)(3) to a Registration Statement
on Form S-1 (No. 33-69474) and the same is incorporated herein by
reference.

10(g)(4) Business Loan Agreement with Michigan National Bank executed April
14, 1987, was filed as Exhibit 10(g)(4) to a Registration
Statement on Form S-1 (No. 33-69474) and the same is incorporated
herein by reference.

E-3

EXHIBIT NO. DESCRIPTION
- ----------- -----------

10(g)(5) Promissory Note with NBD Bank, N.A., dated January 20, 1994, was
filed as Exhibit 10(g)(5) to a Form 10-K Annual Report for the
year ended December 25, 1993, and the same is incorporated herein
by reference.

10(g)(6) Promissory Note with Old Kent Bank and Trust Company, dated
January 24, 1994, was filed as Exhibit 10(g)(6) to a Form 10-K
Annual Report for the year ended December 25, 1993, and the same
is incorporated herein by reference.

10(g)(7) Promissory Note with Michigan National Bank, dated January 27,
1994, was filed as Exhibit 10(g)(7) to a Form 10-K Annual Report
for the year ended December 25, 1993, and the same is incorporated
herein by reference.

10(g)(8) Promissory Note with Comerica Bank, dated February 14, 1994, was
filed as Exhibit 10(g)(8) to a Form 10-K Annual Report for the
year ended December 25, 1993, and the same is incorporated herein
by reference.

10(h)(1) Land Contract Agreement dated May 26, 1994, was filed as Exhibit
10(h)(1) to a Form 10-Q Quarterly Report for the quarter period
ended June 25, 1994, and the same is incorporated herein by
reference.

10(i)(1) Revolving Credit Agreement dated November 13, 1998.

10(j)(1) Series 1998-A, Senior Note Agreement dated December 21, 1998.

13 Selected portions of the Company's Annual Report to Shareholders
for the fiscal year ended December 26, 1998.

21 List of Registrant's subsidiaries.

23 Consent of Deloitte & Touche LLP.

27 Financial Data Schedule.

- -----------------------

*Indicates a compensatory arrangement.

E-4