<PAGE>
SCHEDULE 14A INFORMATION
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-11(c) or
Section 240.14a-12
BOISE CASCADE CORPORATION
- --------------------------------------------------------------------------------
(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
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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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<PAGE>
[LOGO]
BOISE CASCADE CORPORATION
------------------------
ANNUAL MEETING
OF SHAREHOLDERS
BOISE, IDAHO
APRIL 15, 1999
------------------------
NOTICE AND PROXY
STATEMENT
<PAGE>
[LOGO]
NOTICE OF ANNUAL MEETING
Thursday, April 15, 1999
12 noon, Mountain Daylight Time
Boise Cascade Corporation Headquarters Building
1111 West Jefferson Street
Boise, Idaho
March 11, 1999
Dear Shareholder:
You are cordially invited to attend the 1999 Boise Cascade Corporation
annual meeting of shareholders to:
- Elect five directors to serve three-year terms.
- Approve appointment of Arthur Andersen LLP as independent auditors for
1999.
- Conduct other business properly brought before the meeting.
Shareholders who owned stock at the close of business on February 22, 1999,
can vote at the meeting.
Your vote is important. Whether you plan to attend or not, please sign,
date, and return the enclosed proxy card in the envelope provided. If you attend
the meeting and prefer to vote at that time, you may do so.
Thank you for your ongoing support of and continued interest in Boise
Cascade.
Sincerely yours,
[LOGO]
George J. Harad
Chairman and
Chief Executive Officer
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
Notice of Annual Meeting
Boise Cascade Corporation.................................................................................. 1
Annual Meeting Information................................................................................. 1
Proxy Statement.......................................................................................... 1
Voting................................................................................................... 1
Boise Cascade Employees Who Are Shareholders............................................................. 1
Confidential Voting Policy............................................................................... 2
Votes Necessary for Action to be Taken................................................................... 2
Proxy Solicitation....................................................................................... 2
Proposals You May Vote On.................................................................................. 2
1. Election of Directors................................................................................. 2
2. Appointment of Independent Public Accountants......................................................... 2
3. Other Matters to be Presented at the Meeting.......................................................... 2
Board of Directors......................................................................................... 3
Structure................................................................................................ 3
Directors Nominated This Year for Terms Expiring in 2002................................................. 3
Directors Whose Terms Expire in 2001..................................................................... 4
Directors Whose Terms Expire in 2000..................................................................... 5
Business Relationships with Directors.................................................................... 5
Meetings and Committees of the Board....................................................................... 6
Committee of Outside Directors........................................................................... 6
Executive Committee...................................................................................... 6
Executive Compensation Committee......................................................................... 6
Audit Committee.......................................................................................... 6
Nominating Committee..................................................................................... 7
Director Compensation...................................................................................... 7
Director Stock Option Plan............................................................................... 7
Director Stock Compensation Plan......................................................................... 8
Director Deferred Compensation Program................................................................... 8
Stock Ownership............................................................................................ 9
Directors and Executive Officers......................................................................... 9
Ownership of More than 5% of Boise Cascade Stock......................................................... 10
Executive Compensation Committee Report.................................................................... 11
Base Salary.............................................................................................. 12
Annual Variable Incentive Compensation................................................................... 12
Stock Options............................................................................................ 12
Other Compensation Plans................................................................................. 13
Executive Compensation Committee of the Board of Directors............................................... 13
Performance Graph.......................................................................................... 14
Compensation Tables........................................................................................ 14
Stock Option Tables...................................................................................... 16
Other Benefit Plans........................................................................................ 17
Deferred Compensation.................................................................................... 17
Pension Plan............................................................................................. 17
Supplemental Early Retirement Plan....................................................................... 18
Executive Officer Agreements............................................................................. 18
Deferred Compensation and Benefits Trust................................................................. 19
Indemnification.......................................................................................... 20
</TABLE>
i
<PAGE>
<TABLE>
<S> <C>
Other Information.......................................................................................... 20
Section 16(a) Beneficial Ownership Reporting Compliance.................................................. 20
Boise Cascade's Annual Report and Form 10-K.............................................................. 20
Shareholder Proposals for the 2000 Annual Meeting........................................................ 20
Shareholder Nominations for Directors.................................................................... 20
</TABLE>
ii
<PAGE>
BOISE CASCADE CORPORATION
Boise Cascade is a major distributor of office products and building
materials and an integrated manufacturer and distributor of paper and wood
products. We also own and manage over 2 million acres of timberland in the
United States. The address of our corporate headquarters is 1111 West Jefferson
Street, P.O. Box 50, Boise, Idaho 83728-0001. Our telephone number is (208)
384-6161. Boise Cascade's website is located at www.bc.com on the Internet.
ANNUAL MEETING INFORMATION
PROXY STATEMENT
This proxy statement summarizes information we must provide to you under the
rules of the Securities and Exchange Commission (SEC). It is designed to assist
you in voting your shares. We began mailing these proxy materials on or about
March 11, 1999.
VOTING
Shareholders can vote by mail or at the annual meeting by completing a proxy
card. If you submit a properly executed proxy card, the individuals named on the
card, as your proxies, will vote your shares in the manner you indicate. You may
specify whether your shares are voted for all, some, or none of the nominees for
director and whether your shares are voted for or against the appointment of
Arthur Andersen. If you sign and return the card without indicating your
instructions, your shares will be voted FOR:
- the election of the five nominees to serve three-year terms on our board
of directors; and
- the appointment of Arthur Andersen LLP as our independent auditors for
1999.
You may revoke or change your proxy at any time prior to the vote at the
annual meeting. To do so:
- deliver a new proxy to the independent tabulator, Corporate Election
Services, Inc.;
- give us written notice of your change or revocation; or
- attend the annual meeting and vote in person.
Each share of Boise Cascade stock is entitled to one vote. As of February
22, 1999 (the record date for determining shareholders entitled to vote at the
meeting), we had the following outstanding voting stock:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------
NUMBER OF
TYPE/SERIES OF STOCK SHARES OUTSTANDING
- -----------------------------------------------------------------------------------------
<S> <C>
Common stock........................................................ 56,371,927
Convertible preferred stock, Series D (ESOP)........................ 5,328,293
- -----------------------------------------------------------------------------------------
</TABLE>
BOISE CASCADE EMPLOYEES WHO ARE SHAREHOLDERS
Employees participating in the Employee Stock Ownership Plan (ESOP) fund of
our Savings and Supplemental Retirement Plan (SSRP) and in the company's common
stock fund in one of our savings plans will receive one proxy with respect to
all of their shares registered in the same name. ESOP participants may instruct
the plan's trustee how to vote the shares allocated to their accounts, as well
as a proportionate amount of unallocated and unvoted shares. Participants in the
company's common stock fund may instruct the plans' trustee how to vote the
shares allocated to their accounts. If you do not provide instructions, the
trustee will vote your shares in the same proportion as shares for which voting
instructions have been provided by other participants.
1
<PAGE>
CONFIDENTIAL VOTING POLICY
We have a confidential voting policy. Shareholders' votes on our proxy card
will not be disclosed to us other than in specified situations. The tabulator
will collect, tabulate, and retain all proxy cards and will forward any comments
written on the proxy cards to management.
VOTES NECESSARY FOR ACTION TO BE TAKEN
A quorum is necessary to hold a valid meeting. A quorum will exist if a
majority of the shareholders entitled to cast votes at the meeting are present
in person or by proxy.
The five nominees who receive the greatest number of votes at the annual
meeting will be elected as directors. The appointment of Arthur Andersen LLP as
our independent public accountants for 1999 requires an affirmative vote of the
majority of the votes cast on this matter.
Abstentions do not count as votes cast either for or against the directors.
PROXY SOLICITATION
We will pay the expenses of soliciting proxies. We retained D. F. King and
Company Inc. to assist us in the distribution and solicitation of proxies. We
will pay D. F. King a fee of $14,000, plus expenses, for these services. Proxies
may also be solicited on our behalf by directors, officers, and other employees
in person or by telephone or electronic transmission. We will not, however,
specially compensate these persons for doing so.
PROPOSALS YOU MAY VOTE ON
1. ELECTION OF DIRECTORS
There are five nominees for election this year. Detailed information on each
nominee is provided on pages 3 and 4. If a nominee is unavailable for election,
we will vote the proxies for another nominee recommended by the Nominating
Committee and nominated by the board of directors. As an alternative, the board
may reduce the number of directors to be elected at the meeting.
YOUR BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR"
EACH OF THESE NOMINEES.
2. APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
Your board of directors, upon the recommendation of its Audit Committee, has
appointed Arthur Andersen LLP to serve as our independent auditors for 1999,
subject to the approval of our shareholders. Arthur Andersen has served us in
this capacity since 1956. Representatives of Arthur Andersen will be present at
the annual meeting to answer questions. They will also have the opportunity to
make a statement if they desire to do so.
Audit services provided by Arthur Andersen during 1998 included an audit of
our consolidated financial statements, audits of employee benefit plan financial
statements, and a review of our Annual Report and certain other filings with the
SEC and certain other governmental agencies. In addition, Arthur Andersen
provided various nonaudit services to us during the year.
YOUR BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE APPROVAL
OF ARTHUR ANDERSEN LLP AS OUR INDEPENDENT AUDITORS FOR 1999.
3. OTHER MATTERS TO BE PRESENTED AT THE MEETING
Our management does not know of any other matters to be voted on at the
meeting. If, however, other matters are presented for a vote at the meeting, the
persons named on the enclosed proxy card will vote your properly executed proxy
according to their judgment on those matters.
2
<PAGE>
BOARD OF DIRECTORS
STRUCTURE
Our board of directors, comprised of 15 persons, is divided into three
classes for purposes of election. One class is elected at each annual meeting of
shareholders to serve for a three-year term.
Five directors are nominees for reelection in 1999, each to hold office
until the annual meeting of shareholders in 2002 or until he or she reaches
mandatory retirement age, whichever is sooner.
Mr. Edson W. Spencer is retiring from the board effective April 15, 1999,
because he has reached our mandatory retirement age for directors. We thank Ed
for his many years of thoughtful counsel and loyal service to our board.
Our other directors are not up for election this year and will continue in
office for the remainder of their terms or until they retire. Following Mr.
Spencer's retirement and the election of directors, our board will consist of 14
persons.
DIRECTORS NOMINATED THIS YEAR FOR TERMS EXPIRING IN 2002
<TABLE>
<S> <C>
ROBERT K. JAEDICKE, 70, was elected to the board of
[PHOTO] directors in 1983. He is professor (emeritus) of
accounting at the Stanford University Business School
and served as dean of Stanford's Graduate School of
Business from 1983 to 1990. Professor Jaedicke is also
a director of Enron Corp., GenCorp Inc., State Farm
Insurance Companies, and California Water Service
Company.
PAUL J. PHOENIX, 71, was elected to the board of
[PHOTO] directors in 1987. He is the former chairman of the
board and chief executive officer of Dofasco Inc., a
steel products company.
FRANCESCA RUIZ DE LUZURIAGA, 44, was elected to the
[PHOTO] board of directors in 1998. She is the executive vice
president, Worldwide Business Planning and Resources,
of Mattel, Inc., one of the major toy manufacturers in
the world. Prior to holding this position, Ms.
Luzuriaga served as the chief financial officer of
Mattel.
FRANK A. SHRONTZ, 67, was elected to the board of
[PHOTO] directors in 1989. He is chairman emeritus and former
chief executive officer of The Boeing Company, an
aerospace company. He is also a director of Chevron
Corporation and Minnesota Mining & Manufacturing Co.
</TABLE>
3
<PAGE>
<TABLE>
<S> <C>
WARD W. WOODS, JR., 56, was elected to the board of
[PHOTO] directors in 1992. He is president and chief executive
officer of Bessemer Securities, LLC, a privately held
investment company. Mr. Woods is a principal manager,
through wholly owned corporations, of the general
partner of Bessemer Holdings, L.P., and affiliated
investment partnerships. He is also managing general
partner, through wholly owned corporations, of Bessemer
Partners & Co. Mr. Woods is a director of Kelley Oil &
Gas Corporation and several private companies.
</TABLE>
DIRECTORS WHOSE TERMS EXPIRE IN 2001
<TABLE>
<S> <C>
ANNE L. ARMSTRONG, 71, was elected to the company's
[PHOTO] board for the second time in 1978. She was originally
elected in 1975 but resigned the following year to
accept appointment as U.S. Ambassador to Great Britain.
She had served earlier as a counselor to the President
of the United States and as chairman of the President's
Foreign Intelligence Advisory Board. Mrs. Armstrong is
a member of the board of trustees of the Center for
Strategic and International Studies, Washington, D.C.,
and a member of the National Security Advisory Board,
Department of Defense. She is also a director of
Halliburton Company and American Express Company.
PHILIP J. CARROLL, 61, was elected to the board of
[PHOTO] directors in 1997. He is the chairman of the board and
chief executive officer of Fluor Corporation, a global
engineering, construction, maintenance, and diversified
services company. Mr. Carroll is the former president
and chief executive officer of Shell Oil Company.
RAKESH GANGWAL, 45, was elected to the board of
[PHOTO] directors in 1998. He is a director and the president
and chief executive officer of US Airways Group, Inc.,
the parent corporation for US Airways' mainline jet and
express divisions as well as several related companies,
all in the air transportation industry. He is also the
president and chief executive officer of US Airways,
Inc., the main operating arm of US Airways Group.
GARY G. MICHAEL, 58, was elected to the board of
[PHOTO] directors in 1997. He is a director, chairman
of the board, and chief executive officer of
Albertson's, Inc., a retail food and drug company. He
is also a director of Questar Corporation and chairman
of the Federal Reserve Bank of San Francisco.
A. WILLIAM REYNOLDS, 65, was elected to the board of
[PHOTO] directors in 1989. He is the chief executive of Old
Mill Group, a private investment firm. Mr. Reynolds is
the former chairman of the board and chief executive
officer of GenCorp Inc., a diversified manufacturing
and service company. He is also a director of Boise
Cascade Office Products Corporation and Eaton
Corporation and former chairman of the Federal Reserve
Bank of Cleveland.
</TABLE>
4
<PAGE>
DIRECTORS WHOSE TERMS EXPIRE IN 2000
<TABLE>
<S> <C>
EDWARD E. HAGENLOCKER, 59, was elected to the board of
[PHOTO] directors in 1998. He is the former vice chairman of
Ford Motor Company, an automotive manufacturer, and
former chairman of Visteon Automotive Systems, an
automotive parts business and enterprise of Ford Motor
Company. He is also a director of Air Products and
Chemicals, Inc.
GEORGE J. HARAD, 54, was elected a member of the board
[PHOTO] and president of the company in 1991. He was elected
chief executive officer of Boise Cascade in 1994 and
became chairman of the board in 1995. Mr. Harad has
been an executive officer of the company since 1982. He
is also chairman of the board of Boise Cascade Office
Products Corporation and a director of Allendale
Insurance Co. and US West, Inc.
DONALD S. MACDONALD, 67, was elected to the company's
[PHOTO] board for the second time in 1996. He was originally
elected in 1978 but resigned in 1986. Mr. Macdonald is
of counsel in the Toronto law firm of McCarthy
Tetrault. He served as Canadian High Commissioner to
Great Britain and Northern Ireland from 1988 to 1991.
In addition, Mr. Macdonald was a member of the Canadian
House of Commons for 16 years and a former chairman of
the Royal Commission on the Economic Union and
Development Prospects for Canada. Between 1968 and
1977, he held the Cabinet positions of President of the
Privy Council; Minister of National Defence; Minister
of Energy, Mines, and Resources; and Minister of
Finance. Mr. Macdonald is chairman and director of
Celanese Canada Inc. and a director of Alberta Energy
Company Limited, BFC Construction Corporation, Sun Life
Assurance Company of Canada, TransCanada Pipelines
Limited, and several private companies.
JANE E. SHAW, 60, was elected to the board of directors
[PHOTO] in 1994. She is the chairman of the board and chief
executive officer of AeroGen, Inc., a private company
specializing in the development of pulmonary drug
delivery systems. Dr. Shaw formerly served as president
and chief operating officer of ALZA Corporation, a
therapeutic systems company. She is also a director of
Aviron, Intel Corporation, and McKesson HBOC, Inc.
</TABLE>
BUSINESS RELATIONSHIPS WITH DIRECTORS
Donald S. Macdonald is of counsel in the law firm of McCarthy Tetrault,
located in Toronto, Ontario, Canada. We and some of our affiliates occasionally
used this firm's services in 1998 to advise us on Canadian legal matters. We
expect to do the same in 1999. We retain this firm independently of Mr.
Macdonald's service on our board of directors.
5
<PAGE>
MEETINGS AND COMMITTEES OF THE BOARD
During 1998, our board of directors met seven times. In addition to meetings
of the full board, directors also attended meetings of board committees. All of
the directors, except Ms. Shaw and Mr. Woods, attended at least 75% of the total
meetings of the board and the committees on which they served.
THE BOARD OF DIRECTORS AND COMMITTEE MEMBERSHIP
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
EXECUTIVE
COMMITTEE OF EXECUTIVE COMPENSATION AUDIT NOMINATING
DIRECTOR OUTSIDE DIRECTORS COMMITTEE COMMITTEE COMMITTEE COMMITTEE
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Anne L. Armstrong................................. X X X
Philip J. Carroll................................. X X X
Rakesh Gangwal(1)................................. X
Edward E. Hagenlocker............................. X X X
George J. Harad................................... X(2)
Robert K. Jaedicke................................ X X
Donald S. Macdonald............................... X X X
Gary G. Michael................................... X X X
Paul J. Phoenix................................... X X X(2)
A. William Reynolds............................... X X X
Francesca Ruiz de Luzuriaga(1).................... X
Jane E. Shaw...................................... X X X(2)
Frank A. Shrontz.................................. X(2) X X
Edson W. Spencer.................................. X X
Ward W. Woods, Jr................................. X X X(2)
1998 Meetings..................................... 2 1 4 3 3
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) New directors elected in December 1998. In 1999, Ms. Ruiz de Luzuriaga will
serve on the Committee of Outside Directors, Executive Compensation
Committee, and Audit Committee. Mr. Gangwal will serve on the Committee of
Outside Directors, Audit Committee, and Nominating Committee.
(2) Committee chair.
COMMITTEE OF OUTSIDE DIRECTORS
The Committee of Outside Directors reviews the performance of the chief
executive officer against his individual and corporate goals and strategies. It
also reviews the performance and processes of the board of directors and
evaluates the communication among the board, management, and shareholders. The
committee meets at least twice each year without Mr. Harad (our only management
director) present.
EXECUTIVE COMMITTEE
In the absence of a full meeting of the board, the Executive Committee can
exercise most of the powers and authority of the full board to manage our
business and affairs.
EXECUTIVE COMPENSATION COMMITTEE
The Executive Compensation Committee, comprised entirely of outside
directors, establishes all executive officer compensation. In addition, it
reviews general compensation and benefit plans and oversees administration of
stock option and variable compensation programs which apply to officers and
directors. The committee also advises the board on nominees for executive
officer positions in the company.
AUDIT COMMITTEE
The Audit Committee, comprised entirely of outside directors, meets
periodically with management, our internal auditors, and our independent
auditors to assure that appropriate audits of our affairs are being conducted.
Additionally, it reviews corporate compliance policies and activities, the scope
of internal and external audit activities, and the results of the annual audit.
The committee also recommends a public accounting firm to serve as independent
auditors each year. Both the independent auditors and the internal auditors
communicate directly with the committee (outside the presence of management)
regarding the results of their examinations, the adequacy of internal accounting
controls, and the integrity of financial reporting.
6
<PAGE>
NOMINATING COMMITTEE
The Nominating Committee, comprised entirely of outside directors, reviews
and recommends candidates for nomination to the board.
The board of directors has established qualifications for directors,
including the ability to apply good and independent judgment in a business
situation and the ability to represent the interests of all our shareholders and
constituencies. A director also must be free from any conflicts of interest
which would interfere with his or her loyalty to us and our shareholders. In
evaluating board candidates, the committee considers these qualifications as
well as several other factors, including but not limited to:
- demonstrated maturity and experience;
- geographic balance;
- expertise in business arenas relevant to Boise Cascade;
- background as an educator in business, economics, or the sciences; and
- diversity of background, with particular consideration to female and
minority candidates.
If you wish to suggest a nominee for the committee to consider for future
elections, write to Karen E. Gowland, vice president and corporate secretary,
1111 West Jefferson Street, P.O. Box 50, Boise, Idaho 83728-0001. You should
describe in detail your proposed nominee's qualifications and other relevant
biographical information and indicate whether the proposed nominee is willing to
accept nomination. If you wish to nominate a director directly, rather than
through the Nominating Committee, you should follow the procedures described on
page 20 under "Shareholder Nominations for Directors."
DIRECTOR COMPENSATION
Of our current board members, only one, Mr. Harad, is a salaried employee of
Boise Cascade. Board members that are not salaried employees receive separate
compensation for board service. That compensation includes:
<TABLE>
<S> <C>
Annual Retainer: $30,000
Committee Chairperson Stipend: $6,500 annually
Attendance Fees: $1,500 for each board meeting
$600 for each committee meeting
$600 for each board or committee meeting
conducted by telephone
$600 for taking any action by consent in
lieu of meeting
Expenses related to attendance
Stock Options: 1,500 annually
</TABLE>
DIRECTOR STOCK OPTION PLAN
Through our shareholder-approved Director Stock Option Plan, each
nonemployee director receives an annual stock option grant. The options are
exercisable one year after the grant date, and they expire the earlier of (a)
three years after the director's retirement, resignation, death, or termination
as a director or (b) ten years after the grant date. Individuals who are
directors on January 1, or who are newly elected between January 1 and July 31,
receive a grant on July 31. Directors newly elected between August 1 and
December 31 receive a grant when they are elected.
In 1998, each nonemployee director was granted an option to purchase 1,500
shares of our common stock at a price equal to the stock's closing market price
on the grant date.
7
<PAGE>
DIRECTOR STOCK COMPENSATION PLAN
Through our shareholder-approved Director Stock Compensation Plan,
nonemployee directors can elect to receive part or all of their retainers and
meeting fees in stock options rather than cash. Under the plan, the directors
must specify by December 31 of each year how much of their retainer and meeting
fees for the following year they wish to receive in the form of stock options.
Options are granted to participating directors at the end of each calendar
year, equal in value to the cash compensation that the participating directors
would otherwise have received. The number of option shares granted to a
participating director is based on the amount of compensation he or she elected
to have paid in options and the market value of our common stock on July 31 of
each year. The options have an exercise price of $2.50 per share, can be
exercised six months after the date of grant, and expire three years after the
director's resignation, retirement, or termination as director. Ten of the 14
eligible directors participated in this plan in 1998, and nine directors have
elected to participate in the plan in 1999.
DIRECTOR DEFERRED COMPENSATION PROGRAM
Our directors' deferred compensation program allows each nonemployee
director to defer all or a portion of his or her cash compensation.
Under this program, nonemployee directors may defer from a minimum of $5,000
to a maximum of 100% of their cash compensation in a calendar year. For
deferrals prior to 1988, interest is imputed on the deferred amount at a monthly
rate equal to Moody's Composite Average of Yields on Corporate Bonds plus four
percentage points. For deferrals from 1988 to the present, interest is imputed
at a rate equal to 130% of Moody's Composite Average of Yields on Corporate
Bonds. A minimum death benefit is also provided based on pre-1995 deferrals. We
have purchased corporate-owned life insurance policies to help offset the
expense of this program. In the event of a change in control, as defined in the
plans, a trust will pay our obligations under these plans. For more information
on this trust, see "Deferred Compensation and Benefits Trust" on page 19.
As of December 31, 1998, seven current directors were participating in the
deferred compensation program.
8
<PAGE>
STOCK OWNERSHIP
DIRECTORS AND EXECUTIVE OFFICERS
The directors, nominees for director, and executive officers furnished the
following information to us regarding the shares of our common stock which they
beneficially owned on December 31, 1998.
OWNERSHIP OF BOISE CASCADE CORPORATION STOCK
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
AMOUNT AND NATURE
OF BENEFICIAL PERCENT OF
NAME OF BENEFICIAL OWNER OWNERSHIP CLASS
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
DIRECTORS(1)
Anne L. Armstrong.................................................................. 13,575 *
Philip J. Carroll.................................................................. 4,962 *
Rakesh Gangwal..................................................................... 1,500 *
Edward E. Hagenlocker.............................................................. 2,262 *
George J. Harad.................................................................... 604,229(2) *
Robert K. Jaedicke................................................................. 5,996 *
Donald S. Macdonald................................................................ 6,614 *
Gary G. Michael.................................................................... 4,734 *
Paul J. Phoenix.................................................................... 8,195 *
A. William Reynolds................................................................ 24,538 *
Francesca Ruiz de Luzuriaga........................................................ 1,500 *
Jane E. Shaw....................................................................... 8,863 *
Frank A. Shrontz................................................................... 8,500 *
Edson W. Spencer................................................................... 23,951 *
Ward W. Woods, Jr.................................................................. 26,320 *
OTHER NAMED EXECUTIVES
Christopher C. Milliken............................................................ 1,300(2) *
N. David Spence.................................................................... 143,636(2) *
Theodore Crumley................................................................... 160,608(2) *
Richard B. Parrish................................................................. 73,692(2) *
All directors, nominees for director, and executive officers as a group(1)(2)(3)... 2,278,703 3.75%
* Less than 1% of class
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Beneficial ownership for the directors includes all shares held of record or
in street name, plus options granted but unexercised under the Director
Stock Compensation Plan ("DSCP") and Director Stock Option Plan ("DSOP"),
described on page 7 under "Director Compensation." The number of shares
subject to options under the DSCP included in the beneficial ownership table
is as follows: Mrs. Armstrong, 6,575 shares; Ms. Shaw, 3,363 shares; and
Messrs. Carroll, 1,962 shares; Hagenlocker, 762 shares; Macdonald, 914
shares; Michael, 843 shares; Phoenix, 2,362 shares; Reynolds, 9,038 shares;
Spencer, 1,677 shares; Woods, 10,820 shares; and directors as a group,
38,316 shares. The number of shares subject to options under the DSOP
included in the beneficial ownership table is as follows: Mrs. Armstrong,
5,500 shares; Ms. Ruiz de Luzuriaga, 1,500 shares; Ms. Shaw, 5,500 shares;
and Messrs. Carroll, 3,000 shares; Gangwal, 1,500 shares; Hagenlocker, 1,500
shares; Jaedicke, 5,500 shares; Macdonald, 4,500 shares; Michael, 3,000
shares; Phoenix, 5,500 shares; Reynolds, 5,500 shares; Shrontz, 5,500
shares; Spencer, 5,500 shares; Woods, 5,500 shares; and directors as a
group, 59,000 shares.
(2) The beneficial ownership for these executive officers includes all shares
held of record or in street name, plus options granted but unexercised under
the Key Executive Stock Option Plan ("KESOP"), described on page 16 under
"Stock Option Tables," and interests in shares of common stock held in the
Boise Cascade Common Stock Fund by the trustee of the company's Savings and
Supplemental Retirement Plan ("SSRP"), a defined contribution plan qualified
under Section 401(a) of the Internal Revenue Code. The following table
indicates the nature of each executive's stock ownership and also shows the
number of shares of convertible preferred stock, Series D, held in the
Employee Stock Ownership Plan ("ESOP") fund of the SSRP which are not
included in the beneficial ownership table.
<TABLE>
<CAPTION>
COMMON UNEXERCISED SSRP ESOP
SHARES OPTION (COMMON (PREFERRED
OWNED SHARES STOCK) STOCK)
----------- ------------ ----------- -----------
<S> <C> <C> <C> <C>
George J. Harad............................................ 3,050 593,200 7,979 793
Christopher C. Milliken.................................... 0 1,300 0 906
N. David Spence............................................ 2,038 139,600 1,998 273
Theodore Crumley........................................... 1,180 140,200 19,228 563
Richard B. Parrish......................................... 3,358 70,200 134 569
All executive officers as a group.......................... 15,034 2,059,825 62,334 13,858
</TABLE>
(3) Our executive officers (individually or as a group) do not own more than 1%
of the company's Series D Preferred Stock (ESOP).
9
<PAGE>
On December 31, 1998, the following directors, nominees for director, and
executive officers beneficially owned the following number of shares of common
stock of Boise Cascade Office Products Corporation, our majority-owned
subsidiary.
OWNERSHIP OF BOISE CASCADE OFFICE PRODUCTS CORPORATION STOCK
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
COMMON SSRP
SHARES UNEXERCISED (COMMON TOTAL
NAME OF BENEFICIAL OWNER OWNED OPTION SHARES STOCK) SHARES(1)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
DIRECTORS
Anne L. Armstrong.............................................. 4,000 0 0 4,000
George J. Harad................................................ 2,000 0 0 2,000
A. William Reynolds............................................ 20,000 18,000 0 38,000
Jane E. Shaw................................................... 5,000 0 0 5,000
OTHER NAMED EXECUTIVES
Christopher C. Milliken........................................ 8,400 178,400 13,707 200,507
Theodore Crumley............................................... 1,000 0 0 1,000
All directors, nominees for director, and executive officers as
a group...................................................... 45,600 376,800 63,836 486,236
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The individual and aggregate beneficial ownership represents less than 1% of
the outstanding shares.
OWNERSHIP OF MORE THAN 5% OF BOISE CASCADE STOCK
As of December 31, 1998, the table below describes each person or entity
that we know to be the beneficial owner of more than 5% of any class of our
voting securities.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------
DISPOSITIVE
VOTING AUTHORITY AUTHORITY TOTAL AMOUNT
-------------------- -------------------- OF BENEFICIAL PERCENT OF
NAME AND ADDRESS SOLE SHARED SOLE SHARED OWNERSHIP CLASS
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCK, $2.50 PAR VALUE
- ------------------------------------------------------------------------------------------------------------------
Dodge & Cox 3,329,439 58,800 3,738,328 0 3,738,328 6.9 %
One Sansome St.
35th Floor
San Francisco, CA 94104
Joint filing by Franklin Resources, Inc., 4,953,356 0 4,958,156 0 4,958,156 8.8 %
Templeton Global Advisors Ltd.,
Charles B. Johnson, and
Rupert H. Johnson, Jr.
777 Mariners Island Blvd.
San Mateo, CA 94404
Morgan Stanley Dean Witter & Co. 0 4,812,472 0 4,904,157 4,904,157 8.71 %
1585 Broadway
New York, NY 10036
Scudder Kemper Investments, Inc. 820,405 2,648,559 3,684,428 25,403 3,709,831 6.6 %
345 Park Avenue
New York, NY 10154
COMMON STOCK, $2.50 PAR VALUE, AND COMMON STOCK EQUIVALENTS
- ------------------------------------------------------------------------------------------------------------------
State Street Bank and Trust Company* 712,306 6,857,311 1,093,772 5,473,604 6,567,376(1) 10.83 %
225 Franklin St.
Boston, MA 02110
CONVERTIBLE PREFERRED STOCK, SERIES D
- ------------------------------------------------------------------------------------------------------------------
State Street Bank and Trust Company, as 0 5,356,648 0 5,356,648 5,356,648(2) 100 %
Trustee for the Boise Cascade
Corporation
Employee Stock Ownership Plan (ESOP)
225 Franklin St.
Boston, MA 02110
*Approximately 17.8% of these shares are held by State Street Bank and Trust Company in its capacity
as trustee for the company's employee savings plans.
</TABLE>
- --------------------------------------------------------------------------------
(1) State Street Bank and Trust Company, as trustee for three of the company's
defined contribution plans and for the Employee Stock Ownership Plan
("ESOP") fund of the Savings and Supplemental Retirement Plan, reported on a
Schedule 13G that it was the beneficial owner of 6,567,376 shares of the
company's common stock. This represents 2,262,934 shares of the company's
common stock and 5,356,648 shares of the company's Convertible Preferred
Stock, Series D (held by the ESOP). The shares of preferred stock held by
the ESOP are convertible into approximately
10
<PAGE>
4,304,442 shares of common stock (using a conversion ratio of 1 share of
preferred stock = .80357 common shares). Included in the reported shares
were 1,169,162 shares of Boise Cascade common stock held by State Street as
trustee for the company's defined contribution plans, representing
approximately 2.1% of the company's common stock outstanding as of December
31, 1998. The trustee, subject to participants' instructions, has voting and
investment authority for the shares held in the company's plans and for the
ESOP shares. State Street Bank and Trust Company has sole voting power for
712,306 shares and sole investment power for 1,093,772 shares not held as
trustee for the company's benefit plans.
(2) The shares of preferred stock held by the ESOP represent approximately 8.7%
of the company's voting securities outstanding as of December 31, 1998. For
further information regarding the Series D preferred stock, see footnote (1)
above.
EXECUTIVE COMPENSATION COMMITTEE REPORT
The Executive Compensation Committee of the board of directors approves the
individual salaries and compensation programs for executive officers. Some of
the company's executive officers are employed by Boise Cascade Office Products
Corporation ("BCOP") and receive their compensation from BCOP. BCOP's
Compensation Committee approves the compensation programs and salaries for these
officers. The following report explains the basis for the committee's
compensation decisions during 1998.
The company's salary policy provides for compensation at competitive levels
for all employees. Our executive compensation program is designed to:
- attract, motivate, reward, and retain the broad-based management talent
critical to achieving the company's business goals;
- link a portion of each executive officer's compensation to the performance
of both the company and the individual executive officer; and
- encourage ownership of company common stock by executive officers.
To ensure that compensation levels remain competitive, the company reviews
various reports and other information on the executive compensation practices of
53 other companies within the paper and forest products industry. These
companies are selected primarily because comparable levels of responsibility can
be identified for executives within those companies. Of these, 10 are included
in the paper and forest products company index contained in the performance
graph following this report.
The company also collects information on the compensation practices of
approximately 270 Fortune 500 manufacturing companies. Together, these paper and
forest products industry and manufacturing companies are referred to as "peer
group" companies in this report. In addition to the peer group companies'
compensation information, the company and committee use information regarding
executive compensation programs provided by human resource consulting firms,
including in 1998, Hewitt Associates, Management Compensation Group, and Stern
Stewart & Co.
The company's executive compensation program has four principal components:
- base salary;
- annual variable incentive compensation;
- stock options; and
- other compensation plans.
During 1998, the cash-based annual variable (at-risk) incentive component linked
executive compensation directly to the company's financial performance, and the
stock option component tied executive compensation to growth in its stock value.
The company's compensation plans reflect the committee's intent that the
compensation paid to executive officers will qualify for federal income tax
deduction by the company. Executive compensation decisions, however, necessarily
involve some subjective judgment. The committee reserves the authority to make
compensation payments that may not be deductible under federal tax law.
11
<PAGE>
BASE SALARY
A salary guideline is established for each salaried position in the company,
including each executive officer position. The midpoint of each salary guideline
approximates the average salary, adjusted for company size (in sales), of
equivalent positions at the peer group companies. Annual base salary is designed
to compensate executives for their level of responsibility, sustained individual
performance, and performance of the business or staff unit which the executive
heads. Business or staff unit performance is measured by economic value added,
return on total capital, effective environmental management, achievement of
sales or production targets, effectiveness of cost-containment measures,
implementation of Total Quality process improvements, and other factors relevant
to the specific position. In weighing these factors, the committee must make
inherently subjective judgments.
Each year, the committee reviews the criteria discussed above and
establishes the chief executive officer's base salary. The chief executive
officer's performance is formally reviewed against a written performance plan.
In 1998, the committee set Mr. Harad's base salary at $800,004 per year. This
salary rate was approximately 8.1% above the midpoint of the designated salary
guideline ($740,340) for the company's chief executive officer. Mr. Harad's
salary reflects his 28 years of experience with the company, his
responsibilities as chief executive officer, and his role in the company's
strategic positioning, cost-effectiveness programs, and Total Quality evolution.
ANNUAL VARIABLE INCENTIVE COMPENSATION
The committee establishes objective performance criteria for the variable
incentive compensation program. This program applies to all of the company's
salaried and certain of its hourly employees. The committee oversees
administration of the plan covering executive officers.
The criteria for the program specify percentages of the participants'
compensation to be paid as additional cash compensation based on improvements in
the company's "economic value added." Economic value added is determined by
calculating the company's operating profit and then subtracting a pretax charge
for the capital used to generate that profit. Studies indicate that, for the
company, increases in economic value added have a high positive correlation to
increases in shareholder value over time.
The committee establishes target payouts for each participating position.
The target payout for the chief executive officer, over a complete business
cycle, should average approximately 70% of the chief executive officer's base
salary, assuming the company performs satisfactorily. The actual payout under
the plan varies from year to year depending on the company's financial
performance for the year. Target payout amounts for executive officers and other
plan participants also vary, depending on the participants' level of
responsibility and on competitive compensation practices.
Under the 1998 program, Mr. Harad received a payment equal to 93.9% of his
base salary, as reported in the Summary Compensation Table. The Summary
Compensation Table reflects amounts paid under this variable incentive program.
STOCK OPTIONS
The purpose of the stock option plan is to further align management's
interests with the company's long-term performance and, therefore, the long-term
interests of the shareholders. The committee grants stock options to executive
officers and other key managers. It administers this plan and generally grants
stock options to plan participants each year. Stock options were granted in
1998. Since the exercise price of all grants represents the fair market value of
the common stock when granted, the options have no value unless the common stock
price appreciates in the future.
The committee determines the number of stock options to grant by:
- analyzing peer group companies' competitive compensation;
- considering consultants' recommendations; and
- taking each individual's salary guideline and responsibility into account.
12
<PAGE>
The committee may also consider the number and exercise price of options granted
to an individual in the past. Corporate or business unit measures are not used
to determine the size of individual option grants.
The stock option plan limits the number of shares issued to any individual
over the life of the plan to 15% of the total number of shares authorized by
shareholders for issuance under the plan. This provision reflects the
committee's view that the plan is intended to provide long-term incentive
compensation to a relatively broad spectrum of the company's management.
In 1998, Mr. Harad received a grant of an option to purchase 102,800 shares
of the company's common stock. In determining the number of shares to include in
Mr. Harad's grant, the committee considered:
- information about stock option grants to chairpersons and chief executive
officers of the peer group companies;
- the company's financial performance;
- the number of shares granted to other chief executive officers and the
value of those options;
- the size of grants offered to the company's other executive officers; and
- the number and exercise price of shares previously granted to Mr. Harad.
OTHER COMPENSATION PLANS
The company's executive officers are entitled to receive additional
compensation in the form of payments, allocations, or accruals under various
other compensation and benefit plans. The plans are described more fully in the
footnotes to the Summary Compensation Table and on page 17 under "Other Benefit
Plans." Each of these plans is an integral part of the company's compensation
program.
EXECUTIVE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
Ward W. Woods, Jr., Chairman
Anne L. Armstrong
Philip J. Carroll
Edward E. Hagenlocker
Gary G. Michael
A. William Reynolds
13
<PAGE>
PERFORMANCE GRAPH
The following graph compares the five-year cumulative total return (assuming
dividend reinvestment) for the Standard & Poor's 500 index, the Standard &
Poor's paper and forest products company index, and Boise Cascade.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
BOISE CASCADE CORP. PAPER & FOREST PRODUCTS S&P 500 INDEX
<S> <C> <C> <C>
1993 $100.00 $100.00 $100.00
1994 $116.59 $104.20 $101.32
1995 $152.81 $114.72 $139.40
1996 $143.00 $126.90 $171.40
1997 $138.67 $136.07 $228.59
1998 $144.90 $138.77 $293.91
</TABLE>
<TABLE>
<CAPTION>
BASE PERIOD RETURN RETURN RETURN RETURN RETURN
COMPANY/INDEX NAME 1993 1994 1995 1996 1997 1998
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Boise Cascade Corp..................................... $ 100 $ 116.59 $ 152.81 $ 143.00 $ 138.67 $ 144.90
Paper & Forest Products................................ 100 104.20 114.72 126.90 136.07 138.77
S&P 500 Index.......................................... 100 101.32 139.40 171.40 228.59 293.91
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
COMPENSATION TABLES
The following tables present compensation information for our chief
executive officer and the four next most highly compensated executive officers
during 1998.
This table sets forth compensation earned during each of the last three
years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
--------------------------------------------- AWARDS
-----------------
OTHER SECURITIES
ANNUAL UNDERLYING ALL OTHER
SALARY($) BONUS($) COMPENSATION($) OPTIONS/SARS(#) COMPENSATION($)
NAME AND PRINCIPAL POSITION YEAR (2) (3) (4) (5) (6)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
George J. Harad, 1998 $ 791,628 $ 751,284 $ 1,891 102,800 $ 98,029
Chairman and 1997 757,377 623,548 0 85,000 69,756
Chief Executive Officer 1996 719,382 129,941 499 70,000 95,925
Christopher C. Milliken, 1998 371,250 202,722 0 0(1) 26,050
Senior Vice President(1) 1997 233,757 87,840 0 0 22,042
1996 207,522 199,331 0 0 17,811
N. David Spence, 1998 338,502 206,465 3,054 23,100 50,421
Senior Vice President and General 1997 324,006 171,548 135 23,800 43,207
Manager, Paper Division 1996 305,214 41,652 0 22,900 52,130
Theodore Crumley, 1998 328,503 200,431 0 28,700 45,470
Senior Vice President and 1997 312,900 166,314 0 24,300 40,418
Chief Financial Officer 1996 290,202 39,730 349 22,900 49,203
Richard B. Parrish, 1998 300,006 182,443 0 23,100 44,400
Senior Vice President, 1997 290,250 153,448 0 19,900 33,093
Building Products 1996 277,452 37,487 0 19,700 40,046
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) All of Mr. Milliken's 1998 compensation was paid by Boise Cascade Office
Products Corporation with the exception of certain accruals of above-market
interest on executive officer deferred compensation plans maintained by the
company
14
<PAGE>
to which he contributed prior to 1996. During 1998, Mr. Milliken was not
granted an option to purchase shares of Boise Cascade's common stock but was
granted an option by the Compensation Committee of the Boise Cascade Office
Products Corporation board of directors to purchase 90,000 shares of Boise
Cascade Office Products Corporation's common stock under its Key Executive
Stock Option Plan.
(2) Includes amounts deferred under the company's SSRP and Executive Officer
Deferred Compensation Plans and, for Mr. Milliken, amounts deferred under
the Boise Cascade Office Products Corporation Deferred Compensation Plans.
(3) Payments, if any, under the company's and Boise Cascade Office Products
Corporation's variable incentive compensation program. See "Annual Variable
Incentive Compensation" on page 12.
(4) The amounts shown in this column reflect the amount of federal income tax
incurred by the named executive and paid by the company or Boise Cascade
Office Products Corporation relating to various executive officer benefits.
The cost incurred by the company during these years for various perquisites
provided to each of the named executive officers is not included in this
column, because the amount did not exceed the lesser of $50,000 or 10% of
the executive's compensation during each year.
(5) Grants under the company's Key Executive Stock Option Plan.
(6) Amounts disclosed in this column include the following:
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
ACCRUALS OF
COMPANY ABOVE-MARKET COMPANY COMPANY-
MATCHING INTEREST ON ALLOCATIONS PAID
CONTRIBUTIONS EXECUTIVE OFFICER TO THE PORTION
TO THE DEFERRED EMPLOYEE OF EXECUTIVE
EXECUTIVE OFFICER COMPENSATION STOCK OWNERSHIP OFFICER LIFE
DEFERRED COMPENSATION PLANS PLAN INSURANCE
NAME YEAR OR SSRP PLANS($)(*) BALANCES($) ($) PROGRAMS($)
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
George J. Harad............ 1998 $ 59,347 $ 25,762 $ 800 $ 12,120
1997 37,267 15,914 1,800 14,775
1996 65,445 12,884 1,700 15,896
Christopher C. Milliken.... 1998 13,773 8,072 0 4,205
1997 12,993 6,356 0 2,693
1996 10,968 4,549 0 2,294
N. David Spence............ 1998 21,422 14,668 592 13,739
1997 15,358 9,708 1,242 16,899
1996 25,094 8,004 1,088 17,944
Theodore Crumley........... 1998 20,782 10,600 800 13,288
1997 14,811 7,023 1,800 16,784
1996 23,737 5,812 1,700 17,954
Richard B. Parrish......... 1998 19,045 21,360 800 3,195
1997 13,765 14,611 1,800 2,917
1996 23,176 12,494 1,700 2,676
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
(*) The company's Executive Officer Deferred Compensation Plans and Boise
Cascade Office Products Corporation's Deferred Compensation Plans are
unfunded plans pursuant to which executive officers may irrevocably elect
to defer receipt of a portion (6% to 20%) of their base salary until
termination of employment or beyond. Amounts deferred through December
31, 1998, are generally credited with imputed interest at a rate equal to
130% of Moody's Composite Average of Yields on Corporate Bonds. The
company's SSRP, in which employees of Boise Cascade Office Products
Corporation may also participate, is a profit-sharing plan qualified
under Section 401(a) of the Internal Revenue Code which contains a cash
or deferred arrangement meeting the requirements of Section 401(k) of the
Code.
15
<PAGE>
STOCK OPTION TABLES
This table details the 1998 option grants under our Key Executive Stock
Option Plan ("KESOP") to the five executives named in the Summary Compensation
Table, as well as to all executive officers as a group and nonofficer employees
as a group.
OPTION/SAR GRANTS IN 1998
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
INDIVIDUAL GRANTS
--------------------------------------------------------------
NUMBER OF GRANT DATE
SECURITIES PERCENT OF VALUE
UNDERLYING TOTAL OPTIONS/ EXERCISE ----------------
OPTIONS/SARS SARS GRANTED TO OR BASE GRANT DATE
GRANTED EMPLOYEES IN PRICE EXPIRATION PRESENT VALUE(3)
NAME (#) FISCAL YEAR ($/SH)(2) DATE ($)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
George J. Harad..................... 102,800 12.21% $ 28.875 7/31/08 $ 811,092
Christopher C. Milliken(1).......... 0 -- 0 -- 0
N. David Spence..................... 23,100 2.74 28.875 7/31/08 182,259
Theodore Crumley.................... 28,700 3.41 28.875 7/31/08 226,443
Richard B. Parrish.................. 23,100 2.74 28.875 7/31/08 182,259
Executive officers as a group....... 406,700 48.31 28.875 7/31/08 3,208,863
Nonofficer employees as a group..... 435,190 51.69 28.875 7/31/08 3,433,649
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) During 1998, Mr. Milliken was not granted an option to purchase shares of
Boise Cascade's common stock but was granted an option, by the Compensation
Committee of the Boise Cascade Office Products Corporation board of
directors, to purchase 90,000 shares of Boise Cascade Office Products
Corporation's common stock under its Key Executive Stock Option Plan at an
exercise price of $18.50/share. This option had a present value at the grant
date (using the Black-Scholes valuation model with assumptions of risk-free
interest rate of 5.5%, expected option term of 4.2 years, and stock price
volatility of 35%) of $606,600 (BCOP common stock currently pays no
dividends). This grant represents 11.51% of the percent of total option
grants to BCOP employees during 1998.
(2) Under the KESOP, the exercise price must be the fair market value at the
date of grant. Options granted under this plan during 1998 were fully vested
when granted. However, except under limited circumstances, the options are
not exercisable until one year after the date of the grant. Under the plan,
no options may be granted after July 24, 2004. The exercise price of options
granted to executive officers as a group and nonofficer employees as a group
is the weighted average of options granted during 1998.
(3) "Grant Date Value" has been calculated using the Black-Scholes model of
option valuation, with assumptions of: (a) a risk-free interest rate of
5.4%, (b) expected stock price volatility of 30%, (c) expected option term
of 4.2 years, and (d) expected dividends of $.60/share. Based on this model,
the calculated values of the options on July 30, 1998 (grant date), are
$7.89 per share granted. This value does not necessarily represent the
amount an option holder may ultimately realize upon exercise of an option.
The following table sets forth the shares acquired and gross value (without
adjustment for personal income taxes and fees, if any) realized by the top five
executives when they exercised their stock options during 1998 and also states
the year-end gross value of unexercised stock options held by these executives.
AGGREGATE OPTION/SAR EXERCISES FOR 1998 AND 1998 OPTION/SAR VALUES
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS OPTIONS/SARS
AT 12/31/98 (#) AT 12/31/98 ($)
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME UPON EXERCISE REALIZED(1) UNEXERCISABLE UNEXERCISABLE(2)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
George J. Harad............................ 0 $ 0 490,400/102,800 $1,713,750/218,450
Christopher C. Milliken.................... 0 0 1,300/ 0 0/ 0
N. David Spence............................ 0 0 116,500/ 23,100 241,825/ 49,088
Theodore Crumley........................... 0 0 111,500/ 28,700 232,675/ 60,988
Richard B. Parrish......................... 0 0 47,100/ 23,100 0/ 49,088
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The "value realized" represents the difference between the option's exercise
price and the value of the company's common stock at the time of exercise.
(2) This column indicates the aggregate amount, if any, by which the common
stock share price on December 31, 1998, $31.00, exceeded the options'
exercise price.
16
<PAGE>
OTHER BENEFIT PLANS
DEFERRED COMPENSATION
Under our 1982 Executive Officer Deferred Compensation Plan, executive
officers elected before January 1, 1987, could defer between 6% and 10% of their
total compensation earned during a period of four years. In addition, each
participant could elect to have an amount up to 3.6% of his or her compensation
imputed to deferrals under the plan in lieu of matching contributions to the
Savings and Supplemental Retirement Plan ("SSRP"). This plan is not funded, and
its cost is largely offset by participant salary deferrals.
The benefit payable to each participant under this plan upon retirement at
age 65 is determined by the amount of salary deferred, any amount we have
contributed, and the number of years to normal retirement age at the time of
contribution. We pay the benefits in equal monthly installments up to 15 years.
Participants may also elect to receive their accrued balance in a lump sum, but
they will incur a 10% penalty and will be suspended from making contributions to
any of our deferred compensation plans for a period of 12 months.
The following table outlines the contributions and benefits under this plan
for the named individuals participating in the plan as of December 31, 1998.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
PROJECTED
YEARS OF SERVICE
UPON ATTAINMENT PARTICIPANT'S ANNUAL BENEFIT
NAME OF AGE 65 DEFERRAL AT AGE 65
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
George J. Harad................................................. 38 $ 87,225 $ 118,120
Richard B. Parrish.............................................. 42 71,343 113,688
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
PENSION PLAN
The estimated annual benefits payable upon retirement at age 65 under this
plan for specified high-five-year average remuneration and years-of-service
classifications are set out in the following table.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
YEARS OF SERVICE
----------------------------------------------------------------
REMUNERATION 15 20 25 30 35 40
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 200,000 $ 37,500 $ 50,000 $ 62,500 $ 75,000 $ 87,500 $ 100,000
250,000 46,875 62,500 78,125 93,750 109,375 125,000
300,000 56,250 75,000 93,750 112,500 131,250 150,000
400,000 75,000 100,000 125,000 150,000 175,000 200,000
500,000 93,750 125,000 156,250 187,500 218,750 250,000
600,000 112,500 150,000 187,500 225,000 262,500 300,000
700,000 131,250 175,000 218,750 262,500 306,250 350,000
800,000 150,000 200,000 250,000 300,000 350,000 400,000
900,000 168,750 225,000 281,250 337,500 393,750 450,000
1,000,000 187,500 250,000 312,500 375,000 437,500 500,000
- --------------------------------------------------------------------------------
</TABLE>
The pension plan entitles each vested employee, including executive
officers, to receive a pension benefit at normal retirement equal to 1 1/4% of
the highest average of any five consecutive years of compensation (as defined in
the plan) out of the last ten years of employment, multiplied by the employee's
years of service.
Boise Cascade Office Products Corporation is a participating employer in our
pension plan.
Under the plan, "compensation" is the employee's base salary plus any
amounts earned under the company's and Boise Cascade Office Products
Corporation's variable incentive compensation programs (only "Salary" and
"Bonus" from the Summary Compensation Table). As of
17
<PAGE>
December 31, 1998, the highest average of annual compensation during any five
consecutive years for 1989 through 1998 and the years of service for the named
executives are as follows:
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
NAME COMPENSATION YEARS OF SERVICE
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
George J. Harad................................................................ $ 1,082,824 28
Christopher C. Milliken........................................................ 330,175 21
N. David Spence................................................................ 428,748 22
Theodore Crumley............................................................... 400,655 28
Richard B. Parrish............................................................. 396,931 38
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
As shown in the Pension Plan Table above, benefits are computed on a
straight-life annuity basis and are not offset by social security or other
retirement-type benefits. An employee is 100% vested in his or her pension
benefit after five years of service, except for certain breaks in service. If an
employee is entitled to a greater benefit under the plan's formula than the
Internal Revenue Code allows for tax-qualified plans, the excess benefits will
be paid from the company's general assets under the unfunded Supplemental
Pension Plan. The benefit under the qualified pension plan is reduced by
compensation deferred under any nonqualified deferred compensation plan. The
Supplemental Pension Plan will also provide payments to the extent that
participation in these deferred compensation plans has the effect of reducing an
individual's pension benefit under the qualified plan.
In the event of a change in control (as defined in the plan), the plan
restricts our ability or our successor's ability to recoup surplus plan assets,
if any exist. In general, after a change in control, the participants and
beneficiaries will receive the plan's surplus assets, if any, on a pro rata
basis if the plan is terminated, merged or consolidated with another plan, or
the assets are transferred to another plan. After a change in control, a
majority (in both number and interest) of plan participants and beneficiaries
must consent to amend this provision.
SUPPLEMENTAL EARLY RETIREMENT PLAN
The Supplemental Early Retirement Plan applies to executive officers:
- 55 years old or older,
- who have ten or more years of service,
- who have served as an executive officer for at least five full years, and
- who retire before age 65.
Eligible officers receive an early retirement benefit prior to age 65 equal to
the benefit calculated under the Pension Plan for Salaried Employees without
reduction due to the officer's early retirement.
EXECUTIVE OFFICER AGREEMENTS
We have entered into agreements with each of our executive officers which
formalize our severance benefits if the executive officer is terminated after a
change in control of the company (as defined in the agreement). The agreements
provide certain severance benefits and protect other benefits that the officers
have already earned or reasonably expect to receive under our employee benefit
plans. The officer will receive the benefits provided under the agreement if,
after a change in control, we terminate the officer's employment other than for
cause or disability (as defined in the agreement) or if the officer terminates
employment after we take certain actions specified in the agreement which
adversely affect the officer. Under the agreement, the officer must remain
employed with us for six months following the first potential change in control.
These agreements help ensure that we will have the benefit of these
officers' services without distraction in the face of a potential change in
control. The board of directors believes that the agreements are in the best
interests of our shareholders and the company. Boise Cascade Office Products
Corporation has entered into a similar agreement with Mr. Milliken.
18
<PAGE>
The benefits under the agreements include:
- the officer's salary through the termination date;
- severance pay equal to three times the officer's annual base salary and
target incentive pay, less any severance pay that the officer receives
under the Severance Pay Policy for Executive Officers, which is currently
the amount of the officer's annual base salary;
- vacation pay according to our Vacation Policy;
- any earned but unpaid bonus under the Key Executive Performance Plan (or
any substitute plan) for the year preceding termination;
- an award under the Key Executive Performance Plan (or any substitute plan)
equal to the greater of:
(a) the officer's target award prorated through the month in which the
officer is terminated, or
(b) the actual award through the end of the month prior to termination
based upon the award criteria for the applicable plan, prorated
through the month in which the officer is terminated;
- benefits under the Supplemental Early Retirement Plan; and
- certain additional retirement and other employee benefits.
The agreements provide four additional benefits. First, we will maintain for up
to one year all employee benefit plans and programs in which the officer was
entitled to participate immediately prior to termination or we will substitute
similar arrangements. Second, we will maintain our participation in the
Split-Dollar Life Insurance Plan until the officer's insurance policy under that
plan is fully paid. Third, we will pay legal fees and expenses which the officer
incurs to enforce his or her rights or benefits under the agreement. Fourth, we
will increase the officer's total payments under the agreement to cover any
excise taxes imposed by the Internal Revenue Service as a result of such
payments.
The estimated amount of payments and other benefits (not including legal
fees, if any) each named executive officer would receive under the agreement
based on 1998 compensation figures (in excess of the benefits to which the
officer is entitled without the agreement) is:
<TABLE>
<S> <C>
- - George J. Harad............................................. $11,143,253*
- - Christopher C. Milliken..................................... 3,915,944
(from Boise Cascade Office Products Corporation)
- - N. David Spence............................................. 1,546,603
- - Theodore Crumley............................................ 3,942,783
- - Richard B. Parrish.......................................... 1,373,699
</TABLE>
* In April 1999, this amount will be reduced to $6,976,247 when Mr. Harad
qualifies for early retirement benefits under the Supplemental Early
Retirement Plan.
(Payments which would be made subsequent to the termination date have been
discounted as of December 31, 1998, at a rate of 5.35%, according to the
requirements of Section 280G of the Internal Revenue Code.) Actual payments made
under the agreements at any future date would vary, depending in part upon what
the executive has accrued under the variable compensation plans and benefit
plans and upon the market price of our common stock.
Each agreement is effective until December 31, 2001. The agreements are
automatically extended each January 1 for a new three-year period, unless we
notify the officers by September 30 of the preceding year that we do not wish to
extend the agreements.
DEFERRED COMPENSATION AND BENEFITS TRUST
The company has established a deferred compensation and benefits trust. This
trust is intended to ensure that participants and beneficiaries under our
nonqualified and unfunded deferred compensation plans and the executive officer
agreements will receive the benefits they have earned
19
<PAGE>
in the event of a change in control of the company (as defined in the plans and
the agreements). The trust will not increase the benefits to which any
individual participant is entitled under the covered plans and agreements. If a
potential change in control occurs, the trust will be revocably funded. If an
actual change in control occurs, the trust will be irrevocably funded and will
pay benefits to participants in accordance with the plans and agreements. The
trustee will receive fees and expenses either from us or from the trust assets.
If the company becomes bankrupt or insolvent, the trust assets will be
accessible to the claims of the company's creditors.
INDEMNIFICATION
To the extent that Delaware law permits, we will indemnify our directors and
officers against liabilities they incur in connection with actual or threatened
proceedings to which they are or may become parties and which arise from their
status as directors and officers. We insure, within stated limits, the directors
and officers against these liabilities. The aggregate premium on the insurance
policies for 1998 was $597,928.
OTHER INFORMATION
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires our directors
and executive officers, and any person who owns more than 10% of a registered
class of our equity securities, to file reports of holdings and transactions in
Boise Cascade shares with the SEC and the New York Stock Exchange. Based on our
records and other information, we believe that in 1998 our directors and
executive officers met all applicable SEC filing requirements.
BOISE CASCADE'S ANNUAL REPORT AND FORM 10-K
We are mailing you our 1998 Annual Report with this proxy statement. We will
file our Form 10-K with the SEC in March. Copies of the 1998 Annual Report to
Shareholders and Annual Report on Form 10-K can be obtained at no charge from
our Corporate Communications Department, 1111 West Jefferson Street, P.O. Box
50, Boise, Idaho 83728-0001, 208/384-7990, or through our Internet home page at
www.bc.com. Our financial statements are also on file with the SEC and with the
New York and Chicago Stock Exchanges. You can obtain copies of these statements
through the Securities and Exchange Commission's web site at www.sec.gov.
SHAREHOLDER PROPOSALS FOR THE 2000 ANNUAL MEETING
If you wish to submit a proposal to be included in our 2000 proxy statement,
we must receive it no later than November 11, 1999.
All other proposals to be presented at the meeting must be delivered to our
corporate secretary, in writing, no later than January 25, 2000. According to
our bylaws, your notice must include:
- a brief description of the business you wish to bring before the meeting
and the reasons for conducting the business at the meeting,
- your name and address,
- the class and number of shares of our stock which you beneficially own,
and
- any material interest you have in the business to be brought before the
meeting.
The chairperson of the meeting may disregard any business not properly
brought before the meeting according to our bylaws.
SHAREHOLDER NOMINATIONS FOR DIRECTORS
The Nominating Committee considers director nominees from shareholders for
election at the annual shareholders meeting if a written nomination is received
by our corporate secretary not less
20
<PAGE>
than 30 days or more than 60 days in advance of the meeting. According to our
bylaws, your notice of nomination must include:
- your name and address;
- each nominee's name, age, and address;
- each nominee's principal occupation or employment;
- the number of shares of our stock which the nominee beneficially owns;
- the number of shares of our stock which you beneficially own;
- any other information that must be disclosed about nominees in proxy
solicitations under Regulation 14A of the Securities Exchange Act of 1934;
and
- each nominee's executed consent to serve as our director if elected.
The chairperson of the meeting may disregard any nomination not made in
accordance with the above procedures.
WE REQUEST THAT YOU PROMPTLY SIGN, DATE, AND RETURN THE ENCLOSED PROXY SO
THAT IT WILL BE AVAILABLE FOR USE AT THE MEETING.
Karen E. Gowland
Vice President
and Corporate Secretary
March 11, 1999
21
<PAGE>
[BOISE CASCADE LOGO]
[RECYCLED LOGO]
This Notice and Proxy Statement is printed on recycled-content
ASPEN-TM- Lightweight Opaque paper produced by
Boise Cascade's papermakers at its St. Helens, Oregon, mill.
This paper is made with no less than 10% postconsumer fiber.
<PAGE>
PROXY [LETTERHEAD]
ANNUAL MEETING OF SHAREHOLDERS, APRIL 15, 1999
- -------------------------------------------------------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The shareholder signing this card appoints George J. Harad, John W. Holleran,
and Karen E. Gowland as proxies, each with the power to appoint a substitute.
They are directed to vote all the shareholder's Boise Cascade Corporation
stock held on February 22, 1999, at the company's annual meeting to be held
on April 15, 1999, and at any adjournment of that meeting. They are also
given discretionary authority to vote on any other matters that may properly
be presented at this meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL NOMINEES LISTED BELOW AND
---
FOR PROPOSAL 2.
- ---
1. Election of Directors: ROBERT K. JAEDICKE FRANCESCA RUIZ DE LUZURIAGA
PAUL J. PHOENIX FRANK A. SHRONTZ WARD W. WOODS
/ / FOR all nominees / / WITHHOLD AUTHORITY WITHHOLD AUTHORITY for the
(except as may for all nominees following nominee(s) only:
be indicated) ______________________________
______________________________
2. Appointment of Arthur Andersen LLP as independent accountants for 1999.
/ / FOR / / AGAINST / / ABSTAIN
10-965a 1/99
<PAGE>
THIS PROXY WILL BE VOTED ACCORDING TO YOUR INSTRUCTIONS. IF YOU SIGN AND
RETURN THE CARD BUT DO NOT VOTE ON THESE MATTERS, THEN PROPOSALS 1 AND 2
WILL RECEIVE FOR VOTES.
This card provides voting authority for all beneficial holdings of Boise
Cascade Corporation shares.
Please sign exactly as the name appears below and date this card. When
shares are held by joint tenants, both should sign. When signing as an
attorney, executor, administrator, trustee, or guardian, give full title as
such. When signing as a corporation, sign in full corporate name by an
authorized officer. When signing as a partnership, sign in partnership name
by an authorized person.
__________________________ __________
Signature of Shareholder Date
__________________________ __________
Signature of Shareholder Date
Forward this card to D. F. King (solicitor) or to Corporate Election
Services (independent tabulator),
P.O. Box 1150, Pittsburgh, PA 15230
Backer for 10-965a
<PAGE>
[LOGO]
BOISE CASCADE CORPORATION
Dear Shareholder:
The Boise Cascade Corporation annual meeting of shareholders will be held in
the company's corporate headquarters building in Boise, Idaho, at noon,
Mountain daylight time, April 15, 1999.
Shareholders of record on February 22, 1999, are entitled to vote by proxy,
before or at the meeting. The proxy card attached to the bottom of this page
is for your use in designating proxies and providing voting instructions.
The attached card serves both as a proxy designation (for shareholders of
record, including those holding shares in the Dividend Reinvestment Plan) and
as voting instructions (for Boise Cascade employee savings plan
participants). As "named fiduciaries," participants in the Boise Cascade
Corporation stock funds of the employee savings plans are entitled to provide
voting instructions to the Trustee, using this card, for allocated shares and
a portion of any unvoted or unallocated shares in the savings plan fund(s) in
which they participate.
Individual proxy/voting instruction cards will be received and tabulated by
Corporate Election Services, Inc., in Pittsburgh, Pennsylvania, an
independent tabulator.
Please indicate your voting preferences on the card, SIGN and DATE the card,
and return it to the independent tabulator in the envelope provided. YOUR
VOTES ARE CONFIDENTIAL.
Thank you.
(fold and tear along perforation)
PROXY AND VOTING INSTRUCTION CARD BOISE CASCADE CORPORATION
ANNUAL MEETING OF SHAREHOLDERS
The Board of Directors recommends a vote FOR APRIL 15, 1999
all nominees listed below and FOR proposal 2.
1. Election of Directors: ROBERT K. JAEDICKE FRANCESCA RUIZ DE LUZURIAGA
PAUL J. PHOENIX FRANK A. SHRONTZ WARD W. WOODS
/ / FOR all nominees / / WITHHOLD AUTHORITY WITHHOLD AUTHORITY for the
(except as may for all nominees following nominee(s) only:
be indicated) ______________________________
______________________________
2. Appointment of Arthur Andersen LLP as independent accountants for 1999.
/ / FOR / / AGAINST / / ABSTAIN
__________________________ __________
Signature of Shareholder Date
__________________________ __________
Signature of Shareholder Date
Shareholder(s) must sign as name(s)
appear in account registration printed
to the left.
Forward this card to Corporate Election Services,
P.O. Box 1150, Pittsburgh, PA 15230
(Instructions on Reverse Side) 10-2033 1/99
<PAGE>
Printed on Boise Cascade Corporation's SUMMIT-Registered Trademark- TAG-X,
100# White, which is made in St. Helens, Oregon.
PROXY AND VOTING INSTRUCTION CARD BOISE CASCADE CORPORATION
ANNUAL MEETING OF SHAREHOLDERS
THIS PROXY AND THESE INSTRUCTIONS ARE SOLICITED APRIL 15, 1999
ON BEHALF OF THE BOARD OF DIRECTORS.
The shareholder signing this card appoints George J. Harad, John W. Holleran,
and Karen E. Gowland as proxies, each with the power to appoint a substitute.
They are directed to vote (as indicated on the reverse side of this card)
all the shareholder's Boise Cascade Corporation stock held on February 22,
1999, at the company's annual meeting to be held on April 15, 1999, and at
any adjournment of that meeting. They are also given discretionary authority
to vote on any other matters that may properly be presented at this meeting.
If the shareholder is a current or former company employee, this card also
provides voting instructions to the Trustee for shares held in any Boise
Cascade Corporation employee savings plans.
This proxy will be voted according to your instructions. If you sign and
return the card but do not vote on these matters, then proposals 1 and 2 will
receive FOR votes.
(To be SIGNED on other side)
Backer for 10-2033 1/99
<PAGE>
ANNUAL MEETING OF SHAREHOLDERS, APRIL 15, 1999
PROXY
FOR THE
CONVERTIBLE PREFERRED STOCK, SERIES D
BOISE CASCADE CORPORATION - 1111 West Jefferson Street
P.O. Box 50
Boise Idaho 83728-0001
_____________________________________________________________________
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The trustee signing this card appoints George J. Harad, John W. Holleran, and
Karen E. Gowland as proxies, each with the power to appoint a substitute. They
are directed to vote all the shares of Boise Cascade Corporation stock held of
record by the trustee on February 22, 1999, at the company's annual meeting to
be held on April 15, 1999, and at any adjournment of that meeting. They are
also given discretionary authority to vote on any other matters that may
properly be presented at this meeting.
The Board of Directors recommends a vote FOR all nominees listed below and FOR
proposal 2.
1. Election of Directors: ROBERT K. JAEDICKE FRANK A. SHRONTZ
FRANCESCA RUIZ DE LUZURIAGA WARD W. WOODS
PAUL J. PHOENIX
FOR WITHHOLD
Robert K. Jaedicke ____________ ____________
Francesca Ruiz de Luzuriaga ____________ ____________
Paul J. Phoenix ____________ ____________
Frank A. Shrontz ____________ ____________
Ward W. Woods ____________ ____________
2. Appointment of Arthur Andersen LLP as independent accountants for 1999.
SHARES FOR: SHARES AGAINST: SHARES ABSTAINING:
___________ ______________ _______________
<PAGE>
THIS PROXY WILL BE VOTED ACCORDING TO YOUR INSTRUCTIONS. IF YOU SIGN AND RETURN
THE CARD BUT DO NOT VOTE ON THESE MATTERS, THEN PROPOSALS 1 AND 2 WILL RECEIVE
FOR VOTES. YOU, AS TRUSTEE, MUST SIGN AND RETURN THIS PROXY FOR THE PLAN SHARES
TO BE COUNTED.
This proxy provides voting authority for all holdings of Boise Cascade
Corporation Convertible Preferred Stock, Series D (ESOP).
Please sign exactly as name appears below. When signing as trustee, give full
title as such.
STATE STREET BANK AND TRUST COMPANY, as 5,328,292.787 Shares
trustee for the Boise Cascade Corporation
Savings and Supplemental Retirement Plan
and Employee Stock Ownership Plan.
Date: April , 1999
---
Signature of Trustee
-------------------------------------------
Forward this form to Corporate Election Services,
P.O. Box 1150, Pittsburgh, PA 15230-9954
