March 14, 1995
Dear Boise Cascade Employee:
Because you participate in a Boise Cascade stock fund in one
of the company's savings plans, you are entitled to vote the
shares held by the plan at the company's annual meeting of
shareholders on April 21, 1995. Company employees represent
about 17% of Boise Cascade's voting shares, so employee
participation in the proxy vote is very important to the
outcome. Enclosed are a notice and proxy statement and an
annual report, along with a voting instruction card that we
hope you will complete.
I would like to draw your attention to one proxy proposal in
particular -- the shareholder proposal regarding our
classified board -- and to ask for your help.
Specifically, I am asking you to vote against the classified-
board proposal.
The classified-board proposal was submitted by the California
Public Employees Retirement System, or Calpers. Calpers is
the largest state pension fund in the United States and has
investments in most public companies, although its investment
in Boise Cascade stock is relatively small (about
227,000 shares, or less than 1%). You may have read recent
press reports about Calpers and the fact that it has targeted
Boise Cascade for special scrutiny.
Boise Cascade's senior management and independent members of
our board of directors have been in discussions with repre-
sentatives of Calpers over the last four years. The discus-
sions centered around two issues -- the company's financial
performance and our corporate-governance practices.
With regard to corporate governance, Calpers has generally
been satisfied. In fact, at one point Calpers described Boise
Cascade as "almost a model of corporate governance." Never
during those discussions did Calpers ask us to declassify
Boise Cascade's board of directors, as they are now proposing.
Declassification of the board simply means that all board
members would be elected every year. We, like more than half
of the Fortune 500 companies, have had a classified, or
staggered, board for many years, which means that a third of
the board is elected each year. We believe that electing
directors in classes provides needed continuity as directors
join and leave the board. Staggered terms also enhance the
board's ability to negotiate in the best interests of all
shareholders with any persons seeking to gain control of the
company. With a staggered board, a majority of the directors
will always have had prior experience as directors of the
company.
Calpers' other issue has been the company's financial
performance, which they evaluate essentially according to one
measure -- five years' total return to shareholders.
Admittedly, over that period of time, Boise Cascade's
financial performance was poor. The company's paper business
experienced its deepest cyclical downturn in modern postwar
history. The paper grades hardest hit were the ones most
important to Boise Cascade. Results in our paper business in
the early '90s suffered severely.
During that time, however, our other two businesses --
building products and office products distribution --
performed well. And in 1993 and 1994, internal efforts to
improve our position in the paper business through cost
reduction and product-mix improvement began to mitigate the
effects of weak paper prices, even as those prices continued
to fall. Indeed, in terms of a two-year time frame rather
than Calpers' five-year time frame, Boise Cascade's total
return to shareholders exceeded that of the S&P 500 and the
S&P Paper and Forest Products Index. We expect strong returns
again in 1995 and 1996.
While I am seeking your support, you should know that your
voting instructions are completely confidential. The law
prohibits the independent tabulator or the trustee from
informing any employee or officer of the company as to how any
individual employee votes.
Your instructions must be received by Corporate Election
Services no later than 8 a.m. Eastern daylight time, on
Thursday, April 20, 1995. Please take this opportunity to
exercise your right to vote.
Sincerely,
George J. Harad
GJH/PM50302Cf
Enclosures
<PAGE>
Interoffice Memo
Boise Cascade Corporation
March 20, 1995
TO: Location Managers
Communicators
FROM: Vince Hannity
SUBJECT: Information for Employee Shareholders about the
Upcoming Proxy Proposal
Boise Cascade has recently distributed its annual proxy
statement to employee stockholders, along with a letter
from George Harad explaining a classified-board proposal
submitted by the California Public Employees Retirement
System, or Calpers.
As always, it's important that employee shareholders
understand the importance of voting their shares. This year,
they should also know about the company's position regarding
the Calpers proposal.
The attached explanation about employee shareholder voting
procedures and the Calpers proposal should be shared with
employee shareholders at your location. You might want to
include it in your location newsletter, post it on bulletin
boards, share it at meetings, or send it via E-mail.
If you need additional information, please contact me at
(208) 384-6390.
attachment
<PAGE>
Important information for employees
who own Boise Cascade stock
WE NEED YOUR HELP
An institutional investor (Calpers) is making a proposal
that deserves your attention
As a shareholder, your vote can help defeat this proposal
About the proposal
A proxy proposal that you should pay special attention to is the
classified-board proposal submitted by the California Public
Employees Retirement System (Calpers). Calpers is the largest
state pension fund in the United States and they have targeted
Boise Cascade for special scrutiny the past few years. Although
they have referred to BC as "almost a model of corporate
governance" in the past, they are now proposing that we
declassify our board.
What's declassification?
Declassification of the board means that all board members must
be elected every year. Like more than half of the Fortune 500
companies, BC has had a classified, or staggered, board for many
years. A classified board has several advantages: it provides
needed continuity as directors come and go off the board and it
enhances the board's ability to negotiate in the best interests
of all shareholders with persons seeking to gain control of the
company. With a staggered board, a majority of the directors
will always have had prior experience as directors of the
company.
A good return to shareholders
Calpers has also targeted the company's financial performance
over the past five years, which has admittedly been poor. While
our paper business has been hit by the deepest cyclical downturn
in modern postwar history, our other two businesses - building
products and office products distribution - performed well. In
the past two years, in fact, Boise Cascade's total return to
shareholders exceeded that of the S&P 500 and the S&P Paper and
Forest Products Index. We expect strong returns again in 1995
and 1996.
Who can vote...
Employee shareholders and salaried employees who participate in a
Boise Cascade stock fund in one of the company's savings plans
(ESOP, SSRP, RSP, or QUEST) are entitled to vote those shares at
the company's annual meeting on April 21, 1995. Employee
shareholders will receive a notice and proxy statement and an
annual report, along with a voting instruction card, in the
coming weeks.
If you don't vote your shares, the trustee will vote for you!
All ESOP shares, both allocated-but-not-voted and unallocated,
will be voted by the plan trustee in the same proportion to the
shares that are voted. This same voting procedure applies to
unvoted SSRP, RSP, and QUEST shares.
Example: If 80% of the shares are voted to defeat
the proposal, and 20% of the shares are voted to
accept it, the entire block of unvoted shares for
that plan will be voted by the trustee 80% against/
20% for the proposal.
Please vote against this proposal
We hope this information will help you decide to vote against the
classified-board proposal; however, please know that your voting
instructions are completely confidential, and in the end, it's
your decision.
Your voting instructions must be received by Corporate Election
Services no later than 8 a.m. Eastern daylight time, on Thursday,
April 20, 1995.
<PAGE>
March 14, 1995 INSTITUTIONAL COVER LETTER
Dear ______________:
Since ___________________ (name of institution) is a substantial
investor in Boise Cascade, I am sending you the company's 1994
Annual Report and 1995 Proxy Statement. I thought you would
appreciate receiving these materials at the same time they are
being sent directly to holders of record.
I would like to draw your attention to one proxy proposal in
particular -- the shareholder proposal regarding our classified
board -- which Boise Cascade's board of directors recommends that
you vote against.
The classified-board proposal was submitted by the California
Public Employees Retirement System, or Calpers. Calpers is the
largest state pension fund in the United States and has invest-
ments in most public companies, although its investment in Boise
Cascade stock is relatively small (about 227,000 shares, or less
than 1%). You may have read recent press reports about Calpers
and the fact that it has targeted Boise Cascade for special
scrutiny.
Boise Cascade's senior management and independent members of our
board of directors have been in discussions with representatives
of Calpers over the last four years. The discussions centered
around two issues -- the company's financial performance and our
corporate-governance practices.
With regard to corporate governance, Calpers has generally been
satisfied. In fact, at one point Calpers described Boise Cascade
as "almost a model of corporate governance." Never during those
discussions did Calpers ask us to declassify Boise Cascade's
board of directors, as they are now proposing.
Boise Cascade, like more than half of the Fortune 500 companies,
has had a classified, or staggered, board for many years. A
third of the board is elected each year. We believe that elect-
ing directors in classes provides needed continuity as directors
join and leave the board. Staggered terms also enhance the
board's ability to negotiate in the best interests of all share-
holders with any persons seeking to gain control of the company.
With a staggered board, a majority of the directors will always
have had prior experience as directors of the company.
Calpers' other issue has been the company's financial
performance, which they evaluate essentially according to one
measure -- five years' total return to shareholders.
Admittedly, over that period of time, Boise Cascade's financial
performance was poor. The company's paper business experienced
its deepest cyclical downturn in modern postwar history. The
paper grades hardest hit were the ones most important to Boise
Cascade. Results in our paper business in the early '90s
suffered severely.
During that time, however, our other two businesses -- building
products and office products distribution -- performed well. And
in 1993 and 1994, internal efforts to improve our position in the
paper business through cost reduction and product-mix improvement
began to mitigate the effects of weak paper prices, even as those
prices continued to fall. Indeed, in terms of a two-year time
frame rather than Calpers' five-year time frame, Boise Cascade's
total return to shareholders exceeded that of the S&P 500 and the
S&P Paper and Forest Products Index. We expect strong returns
again in 1995 and 1996.
Either I or Vince Hannity, our director of investor relations,
will contact you by phone in the next few weeks to address any
issues or respond to any questions you may have with regard to
this proposal.
On behalf of our board of directors and the management of Boise
Cascade, thank you for your interest and support.
Cordially,
George Harad
VH/PM50302Bf
Enclosures
