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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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 Section 240.14a-12
Coachmen Industries, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the 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)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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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:
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[ ] 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 or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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4) Date Filed:
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PERSONS WHO POTENTIALLY ARE TO RESPOND TO THE COLLECTION OF INFORMATION
CONTAINED IN THIS FORM ARE NOT REQUIRED TO RESPOND UNLESS THE FORM DISPLAYS A
CURRENTLY VALID OMB CONTROL NUMBER.
SEC 1913 (02-02)
[COACH LOGO]
COACHMEN INDUSTRIES, INC.
P. O. BOX 3300
ELKHART, INDIANA 46515
574-262-0123
------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 1, 2003
------------------
To the Shareholders of
COACHMEN INDUSTRIES, INC.
NOTICE IS HEREBY GIVEN that the annual meeting of shareholders of COACHMEN
INDUSTRIES, INC., an Indiana corporation, will be held at Christiana Creek
Country Club, 116 West Bristol Street, Elkhart, Indiana, on May 1, 2003 at 10:00
A.M., for the following purposes:
l. To elect three directors of the Company to hold office for the terms
indicated in the proxy statement.
2. To transact such other business as may properly come before the meeting
or any adjournment thereof.
Only shareholders of record at the close of business on March 17, 2003,
are entitled to notice of and to vote at the meeting. Each such shareholder is
entitled to one vote per share on all matters to be voted on at the meeting.
Whether or not you expect to attend the meeting, please sign, date and
return the enclosed proxy in the enclosed envelope.
By order of the Board of Directors,
RICHARD M. LAVERS
Secretary
March 28, 2003
PLEASE DATE, SIGN AND MAIL THE ENCLOSED PROXY CARD IN THE ENVELOPE
PROVIDED WHICH REQUIRES NO POSTAGE FOR MAILING IN THE UNITED STATES. A PROMPT
RESPONSE IS HELPFUL AND YOUR COOPERATION WILL BE APPRECIATED.
COACHMEN INDUSTRIES, INC.
P. O. BOX 3300
ELKHART, INDIANA 46515
574-262-0123
------------------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 1, 2003
------------------
This Proxy Statement is being mailed to shareholders of COACHMEN
INDUSTRIES, INC. ("Coachmen" or the "Company") on or about March 28, 2003, and
is furnished in connection with the Board of Directors' solicitation of proxies
to be used at the Annual Meeting of Shareholders to be held on May 1, 2003, at
the time and place and for the purposes set forth in the Notice of Annual
Meeting of Shareholders accompanying this Proxy Statement. A shareholder
executing a proxy has the power to revoke it at any time prior to the voting
thereof. The Annual Report to Shareholders for the year 2002 accompanies this
Proxy Statement. Additional copies of the Report may be obtained by writing to
the Secretary of the Company.
The expenses in connection with the solicitation of the enclosed form of
proxy, including postage, printing and handling, and actual expenses incurred by
brokerage houses, custodians, nominees and fiduciaries in forwarding documents
to beneficial owners, will be paid by the Company. It is also expected that
solicitation in person or by telephone will be made of some shareholders by
certain directors, officers and employees of the Company without extra
compensation.
ITEMS TO BE VOTED ON
The following items will be voted on at the Annual Meeting:
(1) The election of three nominees to serve on the Company's Board of
Directors, and
(2) Any other business that may properly come before the meeting or any
adjournment thereof.
VOTING INFORMATION
For purposes of the Annual Meeting, a quorum means a majority of the
outstanding shares entitled to vote. As of the close of business on March 17,
2003, the record date for shareholders entitled to vote at the Annual Meeting,
there were outstanding 15,428,242 shares of Common Stock, entitled to one vote
each. In determining whether a quorum exists at the Annual Meeting, all shares
represented in person or by proxy, including abstentions and broker non-votes,
will be counted. A shareholder may, with respect to the election of directors,
(i) vote for the election of all named director nominees, (ii) withhold
authority to vote for all named director nominees or (iii) vote for the election
of all named director nominees other than any nominee with respect to whom the
shareholder withholds authority to vote by so indicating in the appropriate
space on the proxy. Proxies properly executed and received by the Company prior
to the Annual Meeting and not revoked will be voted as directed therein on all
matters presented at the meeting. In the absence of a specific direction from
the shareholder, proxies will be voted for the election of all named director
nominees.
Directors are elected by a plurality of the votes cast by shares present in
person or by proxy at the Annual Meeting and entitled to vote. For any other
matter that may properly come before the meeting, approval is obtained if the
votes cast in favor exceed the votes cast in opposition. Accordingly,
withholding authority to
vote in the election of directors, abstentions and broker non-votes will have no
effect on any matter voted on at the Annual Meeting.
SHAREHOLDER PROPOSALS
Shareholders wishing to include proposals in the Company's Proxy Statement
and form of proxy for the 2004 Annual Meeting of Shareholders must submit such
proposals so that they are received by the Secretary of the Company at the
address indicated on page 1 by no later than November 28, 2003.
NOMINATIONS FOR DIRECTOR
The Company's Bylaws provide that notice of proposed shareholder
nominations for election of directors must be made in writing and either
delivered or mailed by first-class United States mail, postage prepaid, to the
Secretary of the Company, and in either case must be received by the Secretary
of the Company not less than 60 days prior to the month and day of the
anniversary of the last meeting of the shareholders called for the election of
directors. Nominations for the 2004 meeting received after March 2, 2004 will be
considered untimely. The advance notice requirement affords the Board of
Directors the opportunity to consider the qualifications of all proposed
nominees and, to the extent deemed necessary or desirable by the Board, inform
shareholders about such qualifications. The notice must contain certain
information about each proposed nominee, including his age, business and
residence addresses and principal occupation, the number of shares of Common
Stock beneficially owned by him and such other information as would be required
to be included in a proxy statement soliciting proxies for the election of such
proposed nominee. If the chairman of the annual meeting of shareholders
determines that a nomination was not made in accordance with the foregoing
procedures, such nomination is void.
OTHER BUSINESS AT THE ANNUAL MEETING
For a shareholder to bring other business before the 2004 Annual Meeting of
Shareholders, but not have it included in the proxy statement, timely notice
must be submitted in writing, either delivered or mailed by first-class United
States mail, postage prepaid, to the Secretary of the Company, and in either
case be received by the Secretary of the Company not less than 60 days prior to
the month and day of the anniversary of the mailing of the prior year's proxy
statement. The notice must identify the proposing shareholder and his/her
address, and contain a description of the proposed business and such other
information as would be required to determine the appropriateness of including
the proposal in a proxy statement. Shareholder proposals for the 2004 annual
meeting received after January 27, 2004 will be considered untimely and the
proxy solicited by the Company for next year's annual meeting may confer
discretionary authority to vote on such matters without a description of them in
the proxy statement for that meeting.
2
ELECTION OF DIRECTORS
At the meeting, three directors of the Company are to be elected to hold
office for terms of three years or until their successors are elected and
qualified. Unless otherwise indicated on the proxy form, the authority conferred
by the proxy will be used for the purpose of voting in favor of the three
nominees listed below. If any such nominee shall be unable to serve, the proxies
will be voted to fill any vacancy so arising in accordance with the
discretionary authority of the persons named in the proxies. The Board of
Directors has no reason to believe that any such nominee will be unable to
serve.
<Table>
<Caption>
YEAR FIRST
ELECTED
NAME AND AGE PRINCIPAL OCCUPATION(1) DIRECTOR
------------ ----------------------- ----------
NOMINEES FOR ELECTION AS A DIRECTOR FOR A THREE-YEAR TERM EXPIRING IN 2006:
Claire C. Skinner(2) (48) Chairman of the Board, Chief Executive Officer & 1993
President
Donald W. Hudler (68) President & CEO, DDH Investments of Texas 1999
Philip G. Lux (74) Past President of the Company (Retired 1991) 1979
Directors whose terms expire in 2004:
Keith D. Corson(3) (67) Past President & Chief Operating Officer of the Company 1991
(Retired 2000)
Robert J. Deputy (64) Chairman & CEO, Godfrey Marine, Inc. 1998
Edwin W. Miller (57) Chairman & CEO, Millennium Capital Group 1998
Directors whose terms expire in 2005:
Thomas H. Corson (75) Past Chairman of the Board of the Company (Retired 1997) 1965
Geoffrey B. Bloom (61) Chairman of the Board, Wolverine World Wide, Inc. 1999
William P. Johnson (61) Chairman of the Board & CEO, Flying J, LLC 1978
Rex Martin (51) Chairman, President & CEO, NIBCO, Inc, (Appointed to the 2003
remainder of the term of Fredrick M. Miller, deceased)
</Table>
- ---------------
(1) All of the individuals have held the positions set opposite their names for
more than the past five years except as follows: Ms. Skinner was elected
Chairman and CEO of the Company on August 1, 1997 and she assumed the
position of President on September 1, 2000, upon the retirement of Mr. K.D.
Corson. Prior to 2000, Mr. Bloom was both Chairman and CEO of Wolverine
World Wide, Inc. Mr. Hudler was Chairman and CEO of Saturn Retail
Enterprises, Inc. from January 1, 1999 through June 30, 2001. Prior to that,
Mr. Hudler was Chairman, President and CEO of Saturn Corp. GM and Vice
President of General Motors, Inc. from April 1, 1997 through December 31,
1998. Mr. Johnson was Chairman of the Board of Goshen Rubber Co., Inc. until
he retired in 2000. Mr. Miller was Vice President and Treasurer of Eli Lilly
and Company until he retired on December 31, 1998.
(2) Claire C. Skinner is the daughter of Thomas H. Corson and niece of Keith D.
Corson.
(3) Keith D. Corson is the brother of Thomas H. Corson and the uncle of Claire
C. Skinner.
MEETINGS OF THE BOARD OF DIRECTORS
During 2002, the Board of Directors held four meetings. All of the
directors attended at least 75% of the meetings of the Board of Directors and
the committees of which they were members in 2002, except Fredrick M. Miller,
who died of cancer in 2002, and Mr. Martin, who was appointed on January 29,
2003 to fill the remainder of the term of Fredrick M. Miller.
The Board of Directors has three committees as described below.
3
2002 COMMITTEES OF THE BOARD
AUDIT COMMITTEE
The Board of Directors has adopted a written Audit Committee Charter that
outlines the duties of the Audit Committee. A copy of this Charter is attached
as Appendix A. All of the members of the Audit Committee are independent as
defined in the New York Stock Exchange listing standards.
Functions:
- recommend appointment of independent auditor and oversees its
activities
- review audit reports and related financial matters
- oversee that management has maintained the reliability and integrity
of the accounting policies and financial reporting practices of the
Company
- establish and maintain processes to assure that an adequate system
of internal control is functioning within the Company
- establish and maintain reasonable processes to assure compliance by
the Company with all applicable laws, regulations and corporate
policy, including compliance, risk management and legal affairs.
The Audit Committee met eight times in 2002.
AUDIT COMMITTEE REPORT
The Audit Committee, in carrying out its role, relies on the Company's
senior management, including senior financial management, and its independent
auditors. The Board of Directors has determined that the members of the Audit
Committee are "independent," as defined in the corporate governance listing
standards of the New York Stock Exchange relating to audit committees, meaning
that they have no relationship to the Company that may interfere with the
exercise of their independence from management and the Company.
The Audit Committee of the Board of Directors oversees the Company's
financial reporting process on behalf of the Board of Directors. It met, either
in person or via conference calls, with management and the Company's independent
auditors eight times during 2002 and has reported the results of its activities
to the Board of Directors. In this connection, the Audit Committee has:
- Reviewed and discussed the audited financial statements for the fiscal
year ended December 31, 2002 with the Company's management and the
independent auditors (both with and without management);
- Reviewed and discussed the unaudited quarterly financial information
and Quarterly Reports on Form 10-Q with management and the independent
auditors;
- Discussed with Ernst & Young LLP, the Company's independent auditors,
the matters required to be discussed by SAS 61 (Codification of
Statements on Auditing Standards), as amended, with respect to the
quality, not just the acceptability of the Company's accounting
principles; and
- Received written disclosure regarding independence and letter of Ernst
& Young LLP as required by Independence Standards Board Standard No. 1
(Independence Discussions with Audit Committees) and has discussed
with Ernst & Young LLP its independence.
4
Based on the review and discussions described above with respect to the
Company's audited financial statements included in the Company's 2002 Annual
Report to Shareholders, we have recommended to the Board of Directors that such
financial statements be included in the Company's Annual Report on Form 10-K for
the year ended December 31, 2002 for filing with the Securities and Exchange
Commission.
Members of the Audit Committee:
William P. Johnson, Chairman
Philip G. Lux
Edwin W. Miller
COMPENSATION COMMITTEE
The Board of Directors has adopted a written Compensation Committee Charter
that outlines the duties of the Compensation Committee. A copy of this Charter
is attached as Appendix B. All of the members of the Compensation Committee are
independent as defined in the New York Stock Exchange listing standards.
Functions:
- develop and administer the compensation policies and practices of the
Company
- administer the Company's benefit, retirement programs and equity
incentive plans and recommend changes subject to the approval of the
Board of Directors
- establish executive compensation.
The Compensation Committee met five times in 2002.
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Board of Directors (the "Committee") is
responsible for developing and administering the compensation policies and
practices of the Company to ensure that the Chief Executive Officer and other
senior officers are compensated in a manner consistent with the stated
objectives of the Company. The Committee also administers the Company's benefit,
retirement programs and equity incentive plans and recommends changes subject to
approval by the Board of Directors.
The Company's compensation philosophy is to provide a competitive
compensation program with incentives to achieve superior financial performance
for the Company's stakeholders. The Company's executive compensation policies
are designed to achieve these primary objectives:
- Attract, retain, reward and motivate highly talented employees, who
will lead the Company and achieve and inspire superior performance;
- Provide incentives to improve the performance of Coachmen overall and
of each business sector to which an executive is assigned;
- Align the interests of management with those of the Company's
shareholders in both the short and long-term by placing a significant
portion of compensation "at risk", based upon the performance of the
Company and its business units.
Executive compensation consists primarily of the following components: Base
Salaries, Annual Incentive Plans and Long-Term Incentives.
5
BASE SALARIES
Salaries are typically reviewed annually, on a calendar year basis. The
Committee sets executive salaries based on competitive market levels,
experience, individual and Company performance, levels of responsibility and
inflationary factors. In order to attract and retain highly qualified talent,
base salaries are targeted at the 50th percentile, based on survey results of
companies in Coachmen's peer group, as well as a range of manufacturing
companies with whom Coachmen might reasonably compete for executive talent. As
the Committee determines that adjustments to certain base salaries are needed,
they are based upon the degree of deficiency, the level of the executive's
responsibility and personal performance, and business circumstances.
ANNUAL INCENTIVE PLANS
The 2002 Executive Annual Performance Incentive Plan for Senior Executives
emphasizes key performance factors that drive shareholder value. The plan
provides opportunities for bonuses based on the performance of the Company
and/or the performance of its operating divisions or profit-centers. An annual
target bonus goal (the "Target Bonus"), which is expressed as a percentage of
the participant's base salary, is established by the Committee. The degree to
which this Target Bonus is earned or exceeded is directly linked to the degree
the participant achieves or surpasses his/her pre-established financial
objectives. Bonus levels may be expressed as either (i) a matrix of percentages
or (ii) a mathematical formula that determines the percentage of the Target
Bonus that is payable at varying levels of performance.
Performance goals may be based on one or more financial criteria, either
separately or combined, as well as other business criteria, such as measurements
of compliance with Company policies or legal requirements, human resources
criteria, measures of customer satisfaction and subjective evaluations of the
executive's performance and personal development. For 2002, performance goals
were based on sales, earnings per share (EPS), return on assets (ROA) and
business unit contribution (BUC). Business unit contribution is pre-tax income
adjusted for corporate administrative fees and inter-company interest
income/expense. It includes operating income, outside interest, and other
income/expense for the business unit.
COMPENSATION OF EXECUTIVE OFFICERS
SUMMARY COMPENSATION TABLE
<Table>
<Caption>
LONG-TERM COMPENSATION
--------------------------
ANNUAL COMPENSATION RESTRICTED SECURITIES
NAME AND ------------------------------ STOCK UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS(1) OTHER(2) AWARDS(3) OPTIONS(#)(4) COMPENSATION(5)
------------------ ---- ------ -------- -------- ---------- ------------- ---------------
Claire C. Skinner 2002 $310,000 $223,169 $ -- $ -- 8,000 $ 46,420
Chairman of the Board, 2001 300,000 -- -- -- -- 50,466
Chief Executive Officer 2000 281,000 -- -- -- 50,000 14,609
and President
Michael R. Terlep, Jr. 2002 233,846 359,887 2,419 -- 5,500 19,763
President and General 2001 195,000 -- -- -- -- 20,358
Manager, Coachmen 2000 168,000 68,215 -- -- 30,000 6,186
Recreational Vehicle
Company, LLC
Richard M. Lavers 2002 205,000 88,548 18,608 -- 5,500 17,901
Executive Vice President 2001 195,000 69,000 -- -- -- 22,161
and General Counsel and 2000 169,615 -- -- -- 36,000 4,450
Secretary
Joseph P. Tomczak 2002 $200,000 $ 86,388 $10,761 $ -- 5,500 $ 24,163
Executive Vice President 2001 100,000 20,000 96,517 59,085 36,000 139,822
and Chief Financial 2000 -- -- -- -- -- --
Officer
Steven E. Kerr 2002 180,000 63,189 -- -- 5,500 30,209
President and General 2001 165,000 140,000 -- -- -- 20,552
Manager, All American 2000 122,000 140,000 -- -- 12,000 4,013
Homes, LLC
</Table>
6
- ---------------
(1) The Company has incentive bonus plans for both designated officers and key
management personnel. Prior to 2001, under these plans and subject to
certain limitations and exceptions, bonus payments were made from an amount
equal to a maximum of 20% of the result reached by subtracting 6% of the
previous year-end net worth from annual earnings, before the bonuses
described herein and income taxes. For 2002 and 2001, bonuses were paid
under the Executive Annual Performance Incentive Plan described in the
Compensation Committee Report. Included for Mr. Lavers in 2001 is an
unrestricted grant of 2,000 shares of the Company's stock issued on August
23, 2001 with a market value totaling $24,000 on the grant date.
(2) In 2002, Mr. Terlep, Mr. Lavers and Mr. Tomczak were reimbursed for tax
"gross ups" on restricted and unrestricted stock grants in the amount of
$2,419, $18,608 and $10,761, respectively. Mr. Tomczak received tax "gross
up" reimbursement for moving expenses of $96,517 in 2001.
(3) Mr. Tomczak's stock award vests over a three year period at a rate of
33 1/3% per year beginning with his first year anniversary. No dividends are
paid on the unvested portion of the award. On December 31, 2002, the
remaining value of Mr. Tomczak's award was $47,400.
(4) The options are for terms of five to ten years and become exercisable at the
rate of 25% per year at the end of the first year.
(5) The Compensation Committee has approved executive deferred compensation
agreements for certain corporate and subsidiary officers. These agreements
provide monthly payments to executives upon retirement and provide for
monthly payments to the executive's beneficiaries should the executive die
prematurely. The benefits are funded by Company owned life insurance
policies. These agreements provide for twenty-year payments upon retirement
and are fully funded by the life insurance purchased. The amounts in this
column include the Company's contributions under the deferred compensation
plan and interest earned above 120% of the applicable federal rate. The
Company's contributions under this plan for 2002 are as follows: Ms.
Skinner, $19,170, Mr. Terlep, $4,070, Mr. Lavers, $2,351, Mr. Tomczak, $0
and Mr. Kerr, $1,966. In addition, the Company established a retirement plan
under Section 401(k) effective January 1, 2000. Company contributions for
2001 under this plan were $4,000 each for Ms. Skinner, Mr. Kerr, and Mr.
Terlep, $4,300 for Mr. Lavers and $3,000 for Mr. Tomczak. In addition, the
Compensation Committee has approved a Supplemental Employee Retirement Plan
for certain corporate and subsidiary officers. The participants direct the
Company to invest funds in mutual fund investments and Company stock. The
matching contributions vest after a five-year period. Participant benefits
are limited to the value of the vested benefits held on their behalf. The
Company's contributions under this plan for 2002 are as follows: Ms.
Skinner, $23,250, Mr. Terlep, $11,693, Mr. Lavers, $11,250 Mr. Tomczak,
$15,000 and Mr. Kerr, $24,243. Mr. Tomczak was reimbursed for moving
expenses of $132,322 in 2001 and $6,163 in 2002.
7
LONG-TERM INCENTIVES
Long-term incentive compensation opportunities are provided to executives
in positions with significant responsibilities, accountabilities and potential
impact on long-term corporate performance. Long-term incentive compensation is
generally made available in the form of stock options and restricted stock.
These awards are available under the 2000 Omnibus Stock Incentive Program, as
approved by the shareholders. The Committee approves participation in and the
level of stock option grants and stock awards made to individual executives.
Options granted during 2002 vest over a period of four years, and lapse after
ten years. The exercise price must at least equal the fair market value of the
Common Stock on the date of grant. Holders must be employed by the Company at
the time of vesting in order to exercise the options. The Committee awarded
Claire C. Skinner stock options for 8,000 shares of the Company's Common Stock
in 2002 and awarded each of the other named executive officers stock options for
5,500 shares in 2002.
In 2002 a new long-term incentive program, (the "Performance Based
Restricted Stock Plan"), was approved for senior managers for implementation in
2003. The purpose of the Performance Based Restricted Stock Plan is to further
align the interests of executives and senior management with those of the
shareholders, to motivate and reward superior performance, to enhance
recruitment and retention and to advance stock ownership by senior company
executives. The plan provides senior managers an opportunity for an incentive
award consisting of restricted stock grants.
The awards under the Performance Based Restricted Stock Plan are based on
the actual financial performance of the Company at the conclusion of the
Performance Measurement Period, as measured against a three year plan
(Performance Measurement Target) approved by the Board of Directors. The
financial performance measurement for the Performance Based Restricted Stock
Plan is consolidated Net Income.
In order to earn any award for any three year Performance Measurement
Period, at least 85% of the Performance Measurement Target must be achieved. The
maximum level award is 115% of the Performance Measurement Target. The amount of
the participant's long-term incentive award is determined at the end of each
Performance Measurement Period. The amount of the award earned by a participant
will be determined by multiplying (i) the participant's target award for the
Performance Measurement Period by (ii) the percentage obtained as a result of
dividing the Company's actual consolidated net income during the Performance
Measurement Period by the consolidated net income target established for the
Performance Measurement Period.
In the event of a "Change in Control" all shares subject to restricted
stock awards will vest immediately, and will be delivered to the participants,
without restrictions.
To be eligible for a distribution a participant must have participated as a
full time employee of the Company, continuously from the beginning of the
Performance Measurement Period, unless the participant's employment is
terminated by reason of death, disability, or normal retirement, or the
Committee, in its discretion, determines otherwise in the event a participant's
employment is terminated for other than cause or early retirement, and be in
compliance with the Company's Code of Conduct and any applicable Business
Protection Agreements.
The Committee believes that long term incentives encourage equity ownership
interest in the Company, assuring that the interests of the Company's senior
executives are closely aligned with the interests of the shareholders.
STOCK OPTION GRANTS
During 2002, there were 30,000 stock option grants awarded from the
Company's 2000 Omnibus Stock Incentive Program to the executives named in this
proxy statement.
8
STOCK OPTION GRANTS TABLE
The following table shows information with respect to options for the
Company's Common Stock granted under the Company's 2000 Omnibus Stock Incentive
Program.
OPTION GRANTS IN LAST FISCAL YEAR
<Table>
<Caption>
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES
NUMBER OF OF STOCK PRICE
SECURITIES % OF TOTAL APPRECIATION FOR OPTION
UNDERLYING OPTIONS TERM
OPTIONS GRANTED TO EXERCISE EXPIRATION --------------------------
GRANTED(1) EMPLOYEES PRICE DATE 5% 10%
---------- ---------- -------- ---------- -- ---
Claire C. Skinner 8,000 7.9 $16.50 02/19/12 $204,775 $311,249
Michael R. Terlep, Jr. 5,500 5.4 16.50 02/19/12 140,783 213,984
Richard M. Lavers 5,500 5.4 16.50 02/19/12 140,783 213,984
Joseph P. Tomczak 5,500 5.4 16.50 02/19/12 140,783 213,984
Steven E. Kerr 5,500 5.4 16.50 02/19/12 140,783 213,984
</Table>
- ---------------
(1) Options vest over a four year period at 25% per year and expire at the end
of a ten year term.
STOCK OPTION EXERCISES AND VALUES TABLE
The following table shows information with respect to options for the
Company's Common Stock either exercised or having value outstanding under the
Company's 1994 and 2000 Omnibus Stock Incentive Programs.
AGGREGATED OPTION EXERCISES IN FISCAL 2002
AND YEAR END OPTION VALUES
<Table>
<Caption>
OPTIONS EXERCISED NUMBER OF
IN 2002 SECURITIES UNDERLYING VALUE OF UNEXERCISED
-------------------------- UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS AT
SHARES DECEMBER 31, 2002 DECEMBER 31, 2002*
ACQUIRED VALUE ------------------------------ ------------------------------
ON EXERCISE REALIZED* EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- --------- ----------- ------------- ----------- -------------
Claire C. Skinner -- $ -- 32,500 35,500 $145,000 $145,000
Michael R. Terlep, Jr. -- -- 22,500 22,000 89,925 87,975
Richard M. Lavers -- -- 23,250 25,250 107,325 105,375
Joseph P. Tomczak -- -- 9,000 32,500 4,200 102,600
Steven E. Kerr 750 1,500 8,625 12,625 35,288 35,288
</Table>
- ---------------
* Market value of the underlying securities at exercise date or year-end as the
case may be, minus the exercise price of the options.
BENEFITS
In addition to the Company's 401(k) qualified retirement plan, the more
senior managers of the Company (approximately 25) are eligible to participate in
a non-qualified retirement plan. This plan has two levels, a Supplemental
Executive Retirement Plan (SERP) for senior executives and a MIRROR Plan for
other senior managers. Together with the Company's 401(k) plan, these benefits
create a competitive retirement benefit that includes matching Company stock
contributions and vesting requirements.
EXECUTIVE LIFE INSURANCE
The Committee approved an Executive Life Insurance Plan that provides the
SERP and MIRROR Plan participants with either $1,000,000 or $500,000 of life
insurance. The Committee believes that this benefit enhances the Company's
ability to attract and retain executive talent.
9
STOCK OWNERSHIP GUIDELINES
Stock ownership guidelines have been established for senior executives and
officers. The established guidelines range from four times to one times base
salary for key officers that may be designated by the Committee. The targeted
stock ownership should be achieved within four (4) years. Shares to be counted
include shares held in the executives' 401(k), or IRA, Supplemental Deferred
Compensation Plan, restricted shares, shares held in trust or in beneficial
ownership by or for an immediate family member, shares purchased on the open
market or through the Employee Stock Purchase Plan, or shares held following the
exercise of stock options. Stock options are not counted towards the executive's
stock ownership position until exercised.
CHIEF EXECUTIVE OFFICER COMPENSATION
The Chief Executive Officer's (CEO) compensation is established pursuant to
the same philosophy and objectives described earlier in this report, and
includes the same elements and performance measures used for the Company's other
officers. Based on the Company's performance in 2002, the CEO received a bonus
under the Executive Annual Performance Incentive Plan based on achievement of
certain pre-established financial objectives. 2002 total compensation for Claire
C. Skinner as the CEO included a base salary of $310,000 and a bonus under the
Executive Annual Performance Incentive Plan of $223,169, which was approximately
72% of her "Target" bonus.
COMPLIANCE WITH SECTION 162(M)
Federal tax law establishes certain requirements in order for compensation
exceeding $1 million earned by certain executives to be deductible. Because the
total compensation for any executive officer is significantly below the $1
million threshold, the Compensation Committee has not had to address the issues
relative thereto. However, the Committee attempts to preserve the tax
deductibility of all executive compensation while maintaining flexibility with
respect to its compensation programs.
CHANGE IN CONTROL AGREEMENTS
The Company has entered into Change in Control Agreements with certain key
employees, including the named executive officers. Each Change in Control
Agreement provides for the payment of benefits in the event that, within a
three-year period following the date of a "change in control," (i) the
executive's employment is terminated by the Company without "cause," or (ii) the
executive terminates employment for "good reason". The terms "change in
control," "cause" and "good reason" are defined in the Agreements. The amount of
the benefits payable to an executive entitled thereto would be an amount equal
to accrued salary through the termination date and target annual bonus, plus
either two or three times the sum of (i) the executive's annual base salary at
the rate in effect at the time of the change in control or upon termination,
whichever is greater, plus (ii) the executive's target annual bonus. The
Agreements also provide for the full vesting of an executive's 401(k) account
and a matching contribution for a two or three-year period, as well as the
acceleration of vesting of any outstanding options or shares of restricted stock
and the continuation of certain fringe benefits for a two or three-year period.
In addition, several of the benefit plans provide for modified vesting and
contribution provisions upon a change in control. Certain Change in Control
Agreements provide a gross-up of the amount of benefits provided to hold the
executives harmless from the impact of any excise tax imposed under the
"parachute payment" provisions of the Internal Revenue Code. The term of the
Agreements shall extend through the executive's term of employment, or the third
anniversary of the date of a change in control of the Company, if sooner.
10
SUMMARY
The Committee believes that the foregoing compensation programs serve the
long-term interests of shareholders. These programs create a strong link between
long-term executive rewards and long-term shareholder rewards; they attract,
retain and motivate outstanding executive talent; and they further the Company's
long-term leadership succession objectives. The Committee will continue to
emphasize variable, performance based compensation programs that it believes
positively affect long-term shareholder value.
Members of the Compensation Committee:
Robert J. Deputy, Chairman
Geoffrey B. Bloom
Donald W. Hudler
William P. Johnson
NOMINATING AND GOVERNANCE COMMITTEE
Functions:
- consider director nominees recommended by shareholders if such
recommendations are submitted in writing to the Committee in
accordance with the Company's Bylaws
- identify individuals qualified to become Board members
- recommend director nominees for each annual meeting of shareholders
- develop and recommend a set of corporate governance principles
The Nominating and Governance Committee met four times in 2002.
NOMINATING/GOVERNANCE COMMITTEE REPORT
The Nominating Committee was created in 1997 when the Board of Directors
was temporarily expanded from 9 to 11 members, with the purpose of finding and
recommending qualified candidates for the Board of Directors. Subsequently, the
Committee was delegated additional responsibilities in the area of succession
planning. In 2002, the Committee began a search to fill the vacancy created by
the untimely passing of Director Fred Miller, and ultimately recommended the
candidacy of Mr. Rex Martin at the January 2003, meeting, to fill the unexpired
portion of Mr. Miller's term. In response to changing practices in corporate
governance, at the October 24, 2002 meeting of the Board, the name of the
Committee was changed to the Nominating/Governance Committee. The
Nominating/Governance Committee was directed to develop a new charter for the
Committee, meeting new legal requirements. The Committee will recommend such a
charter for adoption in calendar year 2003.
Members of the Nominating/Governance Committee:
Thomas H. Corson, Chairman
Philip G. Lux
Robert J. Deputy
11
OUTSIDE DIRECTOR COMPENSATION
Directors who are also employees of the Company receive no additional
compensation for service as a director. Non-employee directors are compensated
as follows: for the 2002-2003 service year which began May 2002, each Outside
Director of the Company was entitled to the following annual retainers as
compensation for his or her services on the Board of Directors: (a) ten thousand
dollars ($10,000) in cash; (b) ten thousand dollars ($10,000) in the Company's
Common Stock; (c) three thousand dollars ($3,000) in cash for each committee of
the Board on which the director serves; (d) two thousand dollars ($2,000) in
cash for each committee of the Board which the director chairs; and (e) a grant
of an option for one thousand (1,000) shares of the Company's common stock.
The number of shares issued for each stock retainer is determined by and
the option exercise price for each stock option is equal to the closing price of
the Common Stock on the NYSE Composite Transactions Tape, as reported in The
Wall Street Journal, Midwest Edition on the date of the annual shareholders'
meeting. The compensation for the coming year is payable promptly following the
election of the directors at the annual shareholders' meeting, in advance for
the coming service year.
At least fifteen (15) days prior to each annual shareholders' meeting, each
director may irrevocably elect in writing to receive any portion of his or her
cash compensation: in unrestricted Common Stock valued at one hundred ten
percent (110%) of the cash amount elected, plus an amount calculated by the
Company necessary to gross up the director's income to cover the director's
federal income taxes for that year for the additional 10% of stock; or, in
restricted Common Stock valued at one hundred forty percent (140%) of the cash
amount elected. All restricted Common Stock is deposited with the Company until
the director's completion of two years of service thereafter, and is subject to
the following restrictions: (a) deposited stock is non-transferable until the
completion of that two year period of service; and, (b) the shares will be
forfeited to the Company without any payments to the director in the event of a
termination of the director's service on the Board prior to the completion of
the two year period of service for any reason other than death, disability or
mandatory retirement; except that, in the event of a Change in Control, all such
stock will be delivered to the director without any restrictions.
All stock delivered and stock options granted under the compensation plan
for non-employee directors are authorized under the Coachmen Industries, Inc.
2000 Omnibus Stock Incentive Program, as approved by the shareholders.
STOCK OWNERSHIP GUIDELINES--NON-EMPLOYEE DIRECTORS
The Board has adopted stock ownership guidelines for its non-employee
directors at a multiple of four times the amount of the director's annual cash
and stock retainer. The targeted stock ownership should be achieved within three
years of appointment to the Board. Shares to be counted included restricted
shares, shares held in trust or in beneficial ownership by or for an immediate
family member, shares purchased on the open market, or shares held following the
exercise of stock options. Stock options are not counted towards the
non-employee directors' stock ownership position until exercised.
12
DIRECTORS' AND OFFICERS' STOCK OWNERSHIP
The following table shows the amount of Company Common Stock each named
executive officer, nominee and incumbent director beneficially owned as of March
17, 2003, including shares covered by stock options exercisable within 60 days
of March 17, 2003. Please note that, as reported in this table, beneficial
ownership includes those shares each individual has the power to vote or
transfer, as well as shares owned by immediate family members that reside in the
same household.
<Table>
<Caption>
EXEC.
SHARES OFFICERS'
HELD IN DEFERRED
SHARES EXERCISABLE 401(K) COMMON TOTAL SHARES % OF
BENEFICIALLY WITHIN PLAN AS OF STOCK BENEFICIALLY SHARES
NAME OWNED 60 DAYS DECEMBER 31, 2002 UNITS OWNED OUTSTANDING
---- ------------ ----------- ----------------- --------- ------------ -----------
C. C. Skinner 226,402(1) 37,000 146 1,839 265,387 1.7%
G. B. Bloom 8,750 750 0 0 9,500 *
K. D. Corson 71,587(1) 750 0 0 72,337 *
T. H. Corson 1,085,177(1) 750 0 0 1,085,927 7%
R. J. Deputy 32,702 750 0 0 33,452 *
D. W. Hudler 7,250 750 0 0 8,000 *
W. P. Johnson 30,920 750 0 0 31,670 *
S. E. Kerr 2,925 9,375 151 2,615 15,066 *
R. M. Lavers 3,729 25,625 151 1,170 30,675 *
P. G. Lux 101,176 750 0 0 101,926 *
R. Martin 0 0 0 0 0 *
E. J. Miller 9,685 750 0 0 10,435 *
M. R. Terlep, Jr. 3,039 21,625 152 1,274 26,090 *
J. P. Tomczak 1,924 10,375 48 1,500 13,847 *
All Current Directors
and Executive
Officers as a group
(17 persons) 1,598,573 120,200 1,029 8,960 1,728,762 11.2%
</Table>
- ---------------
* Less than 1%.
(1) Includes shares, as to which beneficial ownership is disclaimed, held by or
for the benefit of family members as follows:
C. C. Skinner, 40,642 shares held by J.P. Skinner; K.D. Corson, 36,400
shares held by J.F. Corson; T.H. Corson, 507,540 shares held by D.S. Corson.
13
STOCK OWNERSHIP INFORMATION
The following table sets forth, as of December 31, 2002, information
concerning the only parties known to Coachmen having beneficial ownership of
more than 5 percent of its outstanding Common Stock, based on annual 13G filings
for the year ending December 31, 2002.
<Table>
<Caption>
NUMBER OF
SHARES
NAME AND ADDRESS BENEFICIALLY PERCENT
OF BENEFICIAL OWNER OWNED OF CLASS
------------------- ------------ --------
First Pacific Advisors, Inc. 2,642,200 16.9%
11400 West Olympic Blvd., Suite 1200
Los Angeles, California 90064
FMR Corp. 2,059,580 13.1%
82 Devonshire St
Boston, MA 02109
Dalton, Greiner, Hartman, Maher & Co. 1,329,765 8.4%
565 Fifth Ave., Suite 2101
New York, New York 10017
Dimensional Fund Advisors, Inc. 1,136,700 7.3%
1299 Ocean Avenue
Santa Monica, California 90401
Thomas H. Corson 578,387(1)(2) 3.7%
Past Chairman of the Board
P.O. Box 504
Middlebury, Indiana 46540
Dorthy S. Corson 507,540(2) 3.3%
(Wife of Thomas H. Corson)
P.O. Box 504
Middlebury, Indiana 46540
</Table>
- ---------------
(1) Includes 750 stock options exercisable within 60 days of March 17, 2003.
(2) Thomas H. Corson is also the beneficial owner of 507,540 shares owned by
Dorthy S. Corson. Dorthy S. Corson is also the beneficial owner of 578,387
shares owned by Thomas H. Corson.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires that certain
of the Company's directors, officers and stockholders file with the Securities
and Exchange Commission and the New York Stock Exchange an initial statement of
beneficial ownership and certain statements of changes in beneficial ownership
of Common Stock of the Company. Based solely on its review of such forms
received by the Company and written representation from the directors and
officers that no other reports were required, the Company is unaware of any
instances of noncompliance, or late compliance, with the requirements during the
fiscal year ended December 31, 2002 by its officers, directors or stockholders.
14
PERFORMANCE GRAPH
The stock price performance shown on the graph below is not necessarily
indicative of future price performance. The companies comprising the Peer Group
are Fleetwood Enterprises, Inc., Skyline Corporation, Thor Industries, Inc. and
Winnebago Industries, Inc. The total return of each company in the Peer Group
has been weighted according to Coachmen's stock market capitalization as of the
beginning of each period.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN
ASSUMES INITIAL INVESTMENT OF $100
THROUGH DECEMBER 31, 2002
[PERFORMANCE GRAPH]
<Table>
<Caption>
- --------------------------------------------------------------------------------------------------------------------
1997 1998 1999 2000 2001 2002
- --------------------------------------------------------------------------------------------------------------------
Coachmen Industries, Inc. Cum $ $100.00 $122.81 $ 71.57 $ 50.62 $ 58.92 $ 78.61
S & P 500 Cum $ $100.00 $128.58 $155.64 $141.47 $124.66 $ 97.11
Peer Group Cum $ $100.00 $ 99.45 $ 82.10 $ 56.59 $ 95.80 $110.77
</Table>
Assumes $100 invested at the close of trading on the last trading day preceding
the first day of the fifth preceding fiscal year in Coachmen common stock, S&P
500, and Peer Group.
*Cumulative total return assumes reinvestment of dividends.
15
INDEPENDENT AUDITORS
The Company's auditors for the year 2002 were Ernst & Young LLP, and that
firm has been selected as the Company's auditors for fiscal year 2003. Such
accounting firm is expected to have a representative at the Annual Meeting of
Shareholders and will be available to respond to appropriate questions at that
time and have an opportunity to make a statement if they desire to do so.
AUDIT AND ALL OTHER FEES
The fees billed to the Company by Ernst & Young LLP with respect to the
year 2002 were the following:
<Table>
Annual Audit Fees $ 177,000
Audit-Related Fees $ 14,750
Financial Information Systems
Design and Implementation Fees $ 0
All Other Fees $1,114,840
</Table>
The Annual Audit Fees include amounts billed for audit of the Company's
annual consolidated financial statements for the year 2002 and the timely review
of the financial statements included in the forms 10-Q filed by the Company
during the year. Audit-Related Fees for 2002 were related to a response to an
SEC comment letter regarding the Form 10-K annual report for the year ended
December 31, 2001. Fees billed for non-audit services during the year were
related primarily to tax-related services and internal audit services. It is
anticipated that Ernst & Young LLP will provide tax services during the year
2003. The Audit Committee has considered and concluded that the provision of
other non-audit services is not compatible with maintaining the independence of
Ernst & Young LLP. Consequently, internal audit services previously contracted
with Ernst & Young LLP will either be performed by internal auditors employed by
the Company or by other outside independent consultants.
OTHER BUSINESS
The Board of Directors does not know of any other business to be presented
to the Annual Meeting and does not intend to bring other matters before the
Annual Meeting. However, if any other matters properly come before the Annual
Meeting, it is intended that the persons named in the accompanying proxy form
will vote thereon according to their best judgment and interest of the Company.
No shareholder has informed the Company of any intention to propose any other
matter to be acted upon at the Annual Meeting. Accordingly, the persons named in
the accompanying proxy form are allowed to exercise their discretionary
authority to vote upon any such proposal without the matter having been
discussed in this Proxy Statement.
By Order of the Board of Directors,
RICHARD M. LAVERS
Secretary
Dated: March 28, 2003
16
APPENDIX A:
AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
OF COACHMEN INDUSTRIES, INC.
CHARTER
As amended and adopted August 1, 2002
I. PURPOSE
The Audit Committee shall provide assistance to the corporate directors in
fulfilling their responsibility to oversee that management has: maintained the
reliability and integrity of the accounting policies and financial reporting and
disclosure practices of the Company; established and maintained processes to
assure that an adequate system of internal control is functioning within the
Company; and established and maintained reasonable processes to assure
compliance by the Company with all applicable laws, regulations and corporate
policy, including compliance, risk management and legal affairs.
The Audit Committee will fulfill these responsibilities primarily by
carrying out the activities enumerated in Section IV of this Charter.
II. COMPOSITION
The Audit Committee shall be comprised of no less than three (3) or more
Directors (as determined from time to time by the Board) each of whom shall meet
the independence and experience requirements of the New York Stock Exchange. All
members of the Audit Committee shall have a working familiarity with basic
finance and accounting practices, and at least two members of the Audit
Committee shall have accounting or related executive financial management
expertise.
III. MEETINGS
The Audit Committee shall meet at least four times annually, or more
frequently as it deems necessary to fulfill its responsibilities.
IV. RESPONSIBILITIES AND DUTIES
The Audit Committee does not itself prepare financial statements or perform
audits, and its members are not auditors or certifiers of the Company's
financial statements. It is not the duty of the Audit Committee to determine
that the Company's financial statements are complete and accurate and are in
accordance with generally accepted accounting principles, to conduct
investigations, to resolve disagreements, if any, between management and the
Outside Auditors, or to assure compliance with laws and regulations and the
Company's policies.
To fulfill responsibilities and duties the Audit Committee shall:
1. Review and reassess, at least annually, the adequacy of this Charter.
Make recommendations to the Board, as conditions dictate, to update this Charter
and publish the Committee's purpose in the proxy statement to its shareholders.
2. Review with management and the Outside Auditors the Company's Annual
Report on Form 10-K and financial statements, including a discussion with the
Outside Auditors of the matters required to be discussed by Statement of
Auditing Standards No. 61 ("SAS no. 61"), Communication with Audit Committees.
3. Review with management and the Outside Auditors the Quarterly Report on
Form 10-Q prior to its filing or prior to the release of earnings, including a
discussion with the Outside Auditors of the matters to be discussed under
generally accepted auditing standards. The Chairperson of the Audit Committee
may represent the entire Audit Committee for purposes of this review.
17
4. Make recommendations to the Board regarding the appointment or
termination of the independent certified public accountants to be appointed as
the auditors of the Company ("Outside Auditors") and review the performance of
the Outside Auditors. The Audit Committee shall approve all fees payable to
Outside Auditors, and shall approve all non-audit services to be performed by
the Outside Auditors. The Board has the ultimate authority and responsibility to
select, evaluate and, where appropriate, replace the Outside Auditors. The
Outside Auditors are ultimately accountable to the entire Board through the
Audit Committee for their review of the financial statements and controls of the
Corporation.
5. Oversee independence of the Outside Auditors by receiving from and
discussing with them at least annually, a formal written statement delineating
all relationships between the Outside Auditors and the Company, and any other
relationships that might impact the objectivity and independence of the Outside
Auditors, and including those disclosures required under standards issued by the
Independence Standards Board. Based on such review the Audit Committee shall
assess the independence of the Outside Auditors and, if so determined by the
Audit Committee, recommend that the Board take appropriate action to satisfy
itself of the independence of the Outside Auditors.
6. In conjunction with the Outside Auditors, review the integrity and
quality of the Company's financial reporting processes (internal and external),
accounting principles, judgments and estimates, and any material financial or
other arrangements which do not appear in the financial statements of the
Company, and review any major changes in the Company's auditing and accounting
principles and practices as suggested by the Outside Auditors, internal auditors
or management.
7. Review and discuss with management and the Outside Auditors the adequacy
of the Company's internal controls and internal audit procedures, including the
appointment or replacement of the senior internal auditing executive.
8. Review in conjunction with the General Counsel legal and regulatory
matters which may have a material effect on the financial statements, including
material pending legal proceedings and other contingent liabilities, and any
material reports or inquiries received from regulators or governmental agencies.
9. Meet at least quarterly with the Chief Financial Officer, the senior
internal auditing executive, and the Outside Auditors in separate executive
sessions, and with management present, to discuss the results of their
examinations and other matters, including management's responses.
10. Have the authority to retain such outside counsel, experts or other
advisors as it determines appropriate to assist in the full performance of its
functions.
11. Have the authority to investigate any matter brought to its attention
with full access to all books, records, facilities, and personnel of the
Company.
12. Prepare the report required by the rules of the Securities and Exchange
Commission to be included in the Company's annual proxy statement.
13. Assess its performance of the duties specified in this Charter, and
report its findings to the Board.
18
APPENDIX B:
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
OF COACHMEN INDUSTRIES, INC.
CHARTER
adopted October 20, 2000
The Compensation Committee of the Board of Directors shall provide guidance
to the Corporation in the area of executive compensation to ensure the
Corporation's compensation policies and practices are in furtherance with the
desire to recruit, develop, and retain the highest caliber talent in order to
achieve the Corporation's business plans and optimize long-term financial
returns.
The Compensation Committee shall consist of not less than three members of
the Board of Directors, one of whom shall be the Chairperson. The Committee and
its Chairperson shall be appointed annually by the Board of Directors. In
addition, no member of the Compensation Committee may be a full-time member of
the senior management team.
The Compensation Committee shall have the responsibility and authority for
the following:
1. Annually review and approve an Executive Compensation Plan and Strategy
to ensure that the Chief Executive Officer and other senior officers are
compensated in a manner consistent with the stated organization objectives of
the Company, competitive practices, internal equity considerations, and the
requirements of the appropriate regulatory bodies, and further, that they are
rewarded appropriately for their contributions to company growth and
profitability.
2. Approve revisions to the Company's salary range structure, salary
increase guidelines, and executive promotions.
3. Ensure that the Annual Incentive Compensation Plan(s) are designed and
administered in a manner consistent with the Company's compensation strategy,
including participation, performance and compensation targets, and awards paid.
4. Ensure that equity-related Long Term Incentive Plans for management are
designed and administered in a manner consistent with the Company's compensation
strategy, including participation, performance and vesting requirements, awards
and dilution.
5. Ensure that the Company's employee benefit, retirement programs and
equity incentive plans are administered in a manner consistent with the
Company's compensation strategy; and approve changes to those plans, subject to
Board of Director approval.
6. Review with the CEO matters relating to management succession.
19
DETACH CARD
- -------------------------------------------------------------------------------
COACHMEN INDUSTRIES, INC.
P.O. BOX 3300
ELKHART, INDIANA 46515
THIS PROXY IS BEING SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned shareholder(s) of Coachmen Industries, Inc., an Indiana
corporation, hereby appoints Claire C. Skinner and William P. Johnson, and each
of them, as my (our) proxies, each with the power to appoint a substitute, and
hereby authorizes them, and each of them individually, to represent and to vote,
as designated below, all of the shares of Coachmen Industries, Inc. which the
undersigned is or may be entitled to vote at the Annual Meeting of Shareholders
to be held at the Christiana Creek Country Club, Elkhart, Indiana, at 10:00 a.m.
local time, on May 1, 2003, or any adjournment thereof, with the same authority
as if the undersigned were personally present.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL BELOW:
1. Election of three (3) Directors (to serve for a three-year term expiring in
2006).
[ ] FOR all nominees listed [ ] WITHHOLD AUTHORITY
(except as marked to the contrary below). to vote for all nominees listed below.
Nominees: Claire C. Skinner, Donald W. Hudler and Philip G. Lux
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE
THAT NOMINEE'S NAME ON THE SPACE PROVIDED BELOW.)
- -------------------------------------------------------------------------------
(CONTINUED AND TO BE DATED AND SIGNED ON REVERSE SIDE.)
DETACH CARD
- -------------------------------------------------------------------------------
(CONTINUED FROM THE OTHER SIDE)
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 THE ELECTION OF
DIRECTORS.
YOUR SIGNATURE ON THIS PROXY IS YOUR ACKNOWLEDGMENT OF RECEIPT OF THE NOTICE OF
MEETING AND PROXY STATEMENT.
Dated: ,2003
----------------------
----------------------------------
Signature
----------------------------------
(Signature if held jointly)
NOTE: Please sign exactly as name
appears above. When shares are held by
joint tenants, both should sign. When
signing as attorney, executor,
administrator, trustee, or guardian,
please give title as such. If
shareholder is 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.
PLEASE SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY, USING THE ENCLOSED
ENVELOPE.