April 3, 1998
TO: Our Dealer/Stockholders
Enclosed is a formal notice of the Ace annual stockholders meeting that will
be held on Monday, June 1, 1998. As of this date, the matters that will be
acted upon at the meeting will be the election of five directors.
The enclosed notice contains an Explanatory Summary giving the names and
background information of each of the five persons recommended by the Board
of Directors for election as directors.
At this meeting, the five directors to be chosen are to be elected to
positions in the third director class for three-year terms with one director
being a dealer director at-large, two being non-dealer directors, and one
director being elected from each of Regions 5 and 7. As provided for in the
By-laws, regional dealer-directors are elected from designated geographic
regions of the United States.
Please review the enclosed materials carefully and then complete, sign, date
and mail the enclosed proxy card in the envelope provided for your convenience.
The prompt return of sufficient proxies to enable the business of the meeting
to proceed will save your Company additional expenses of solicitation which
would ultimately be borne by its stockholders.
Of course, if you find it convenient to attend the meeting, you may rescind
your proxy vote and vote in person if you so desire.
Sincerely,
DAVID F. HODNIK RICHARD E. LASKOWSKI
David F. Hodnik Richard E. Laskowski
President and CEO Chairman of the Board
ACE HARDWARE CORPORATION
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
June 1, 1998
Notice is hereby given that the annual meeting of the stockholders of Ace
Hardware Corporation will be held on Monday, June 1, 1998, in Krausman Hall
at the general office of the Corporation, 2200 Kensington Court, Oak Brook,
Illinois at 9:00 A.M., Central Daylight Saving Time, for the following
purposes:
(1) to elect five members of the Board of Directors of the third class to
serve for 3-year terms, of which one shall be a dealer director at-large,
two shall be a non-dealer directors, and one shall be elected from each of
the following director regions:
Region 5 and Region 7;
and
(2) to transact such other business as may properly be brought before the
meeting.
Only those holders of record of shares of Class "A" stock on the books of the
Corporation at the close of business on April 3, 1998 are entitled to notice
of, and to vote at, the meeting.
The names of the five persons selected to be nominees for election as
directors in accordance with the provisions of Article IV of the By-laws of
the Corporation, together with background information concerning each of them,
are set forth in the attached Explanatory Summary.
By order of the Board of Directors
DAVID W. LEAGUE
April 3, 1998 Secretary
IMPORTANT - PLEASE MAIL YOUR PROXY PROMPTLY
In order that there may be proper representation at the meeting, you are
urged to sign and return the enclosed proxy in the envelope provided. Your
cooperation in promptly returning your signed proxy will reduce expenses
incident to following up this solicitation of proxies. Submission of a signed
proxy will not preclude you from voting in person at the meeting if you so
desire.
ACE HARDWARE CORPORATION
2200 Kensington Court
Oak Brook, Illinois 60523
EXPLANATORY SUMMARY FURNISHED IN CONNECTION WITH
SOLICITATION OF PROXIES BY BOARD OF DIRECTORS
Proxies in the form enclosed herewith are solicited by the Board of Directors
of Ace Hardware Corporation (the "Company") for use at the annual meeting of
stockholders to be held in Krausman Hall at the general office of the
Company, 2200 Kensington Court, Oak Brook, Illinois, on Monday, June 1, 1998,
and at any adjournment thereof. Unless authorization to do so is withheld by
the giver of the proxy, the persons named as proxies in the enclosed proxy
card, or such of them as may act, will vote for the election as directors of
all of the persons recommended by the Board of Directors.
Only the holders of record of shares of Class A stock on the books of the
Company at the close of business on April 3, 1998 will be entitled to vote at
the meeting. Even if you expect to attend the meeting in person, you are
requested to return your executed proxy in the enclosed envelope in order to
assure that a quorum of the Class A stock is represented at the meeting and
to enable the business of the meeting to be conducted as expeditiously as
possible. Any stockholder giving a proxy will have the right to revoke it at
any time prior to the voting thereof.
The exact number of outstanding shares of Class A stock on the record date of
April 3, 1998 will be reported at the meeting. Each such outstanding share
entitles the holder to one vote. There will not be cumulative voting for the
election of directors.
The cost of soliciting proxies in the form enclosed herewith is being borne
by the Company. In addition to solicitation by mail, directors, officers and
regular employees of the Company may solicit proxies personally or by
telephone, telegraph or facsimile.
The Company's 1997 Annual Report, including financial statements, has been
mailed to each stockholder.
ELECTION OF DIRECTORS
[Item (1) on proxy card]
In accordance with authority vested in it by Article IV of the By-laws of the
Company, the Board of Directors has determined that the Board shall be
comprised of 12 persons. The Board has determined that one director shall be
a dealer director at-large, two shall be non-dealer directors, and that all 9
remaining members of the Board as to be constituted following the 1998 annual
stockholders meeting, shall be "regional dealer directors".
Each dealer director must be either the owner of a retail business
organization owning stock of the Company or an executive officer, general
partner, or general manager of such a retail business organization.
As also provided for by the Company's By-laws, the Board of Directors has
established 9 geographic regions of the United States from which regional
dealer directors are to be chosen. The Board has authority from time to time
to make revisions in the geographic composition of such regions, as well as to
change the number of regions. Determinations are to be made by the Board each
year as to the regions from which regional dealer directors to be elected at
the next annual meeting shall be chosen. In the discretion of the Board, two
or more dealer directors from the same region may serve on the Board at the
same time.
The current geographic composition of each of the regions established by the
Board of Directors for the election of regional dealer directors pursuant to
the applicable By-law provisions is as follows:
Region 1 - Maine, New Hampshire, Vermont, Massachusetts, Connecticut,
Rhode Island, New York, Pennsylvania, New Jersey;
Region 2 - Delaware, Maryland, Virginia, West Virginia, Kentucky,
Tennessee, North Carolina, South Carolina,
District of Columbia;
Region 3 - Alabama, Mississippi, Georgia, Florida;
Region 4 - Ohio, Indiana, Illinois;
Region 5 - Iowa, Missouri, Nebraska, Kansas, Colorado;
Region 6 - Arkansas, Louisiana, Oklahoma, Texas;
Region 7 - Alaska, Washington, Oregon, Idaho, Montana, Wyoming, Utah;
Region 8 - Arizona, New Mexico, Nevada, California, Hawaii;
Region 9 - Michigan, Minnesota, North Dakota, South Dakota, Wisconsin.
The present directors, their respective director regions and classes, and the
years of expiration of their current terms of office are as follows:
Year of Expiration
Director Region Class of Current Term
----------------------------------------------------------------
Eric R. Bibbens, II 1 First 2000
D. William Hagan 3 First 2000
Jennifer C. Anderson 8 First 2000
Mark Jeronimus 9 First 2000
J. Thomas Glenn 2 Second 1999
Jon R. Weiss 4 Second 1999
John E. Kingrey 6 Second 1999
Richard E. Laskowski 4 Third 1998
James R. Williams 5 Third 1998
Lawrence R. Bowman 7 Third 1998
Roger E. Peterson - Third 1998
As required by the By-laws, the Board of Directors determined that the four
positions on the Board currently held by directors of the class whose terms
expire in 1998 and that the additional position of the same class shall be
filled at the forthcoming 1998 annual stockholders meeting by persons to be
elected for 3-year terms as follows: one dealer director at-large, two
non-dealer directors, one director from Region 5 and one director from Region 7.
Under the By-laws, Mr. Laskowski and Mr. Williams are not eligible for
re-election upon expiration of each of their respective terms as a director
in 1998, but Mr. Bowman and Mr. Peterson are eligible for re-election. As
authorized by a provision in the By-laws under which the Board of Directors
can propose the nomination for re-election of any eligible incumbent director
or election of a non-dealer director, the Board determined that Mr. Bowman and
Mr. Peterson should each be nominated for re-election at the 1998 annual
meeting for additional terms of three years. In addition, the Board has also
determined that Mr. Mario R. Nathusius should be nominated for election as a
dealer director at-large and Mr. Howard J. Jung should be nominated for
election as a non-dealer director at the 1998 annual meeting each for a term
of three years.
The Board established a 1998 Candidate Selection Committee comprised primarily
of 5 dealer stockholders from Region 5 plus 2 directors to select a nominee
for election as director for a 3-year term. The nominee selected by such
Candidate Selection Committee is Mr. Daniel L. Gust in Region 5.
The Board of Directors recommends the election as directors of each of the
five nominees referred to above. The director regions, classes and terms for
which they are being nominated, together with background information
concerning each nominee, is set forth below.
Region 5, Third and 3 years Daniel L. Gust, 48, is the President and
owner of Garden Acres Ace Hardware and Hometown
Ace Hardware & Rental, both in Longmont, CO. He
(Picture of Daniel L. Gust) previously worked from 1972 to 1979 for Winnebago
Industries, Inc., as a manufacturing engineer
and engineering manager. From 1979 to 1984, he
worked for Texas Instruments Consumer Products
Group as a quality assurance manager, and from
1984 to 1990 for MiniScribe Corp. as director
of Asia-Pacific Sales, as well as Vice
President of Quality and Reliability. Mr. Gust
graduated from South Dakota State University
in 1972 with a bachelor of science degree in
mechanical engineering. He also earned a
masters of business administration degree, with
an emphasis on organizational behavior, in 1983
from Texas Tech University. Mr. Gust has been
nominated for a three-year term to represent
dealers in Region 5 - Iowa, Nebraska, Kansas,
Missouri and Colorado, replacing Jim Williams,
who has served three full terms.
Region 7, Third and 3 years Lawrence R. Bowman, 51, is President of
Owenhouse Ace Hardware, Inc., Bozeman, MT., one
of the oldest existing stores in Montana. The
(Picture of Lawrence R. store has operated continuously since 1879 and
Bowman) became affiliated with Ace in 1964. Mr. Bowman
began working at the store part-time in 1971,
became a full-time employee two years later,
and began buying into the store in 1975.
Initially elected to the Ace Board of Directors
in 1991, he represents dealers in Region 7 -
Montana, Idaho, Wyoming, Alaska, Utah,
Washington and Oregon. He currently serves as
chairman of the nominating committee. He is a
graduate of Montana State University with
degrees in business and mechanical engineering
technology. He also served for two years in
the U.S. Army.
Region -, Third and 3 years Howard J. Jung, 50, and his wife, Brug,
currently own and operate an 11,500 sq. ft.
Ace Hardware store in Raleigh, N.C. The store
(Picture of Howard J. Jung) achieved PHD status in 1996 and 1997. Mr. Jung
graduated from the University of Illinois in
1970 with a bachelor of science degree. He
worked for IBM in Springfield, IL., until 1975
when he moved to Raleigh to open an Ace Hardware
store. Mr. Jung served three three-year terms
on the Ace Board of Directors from 1987 to 1996,
representing dealers in Region 2 - South
Carolina, North Carolina, West Virginia,
Maryland, Virginia, Delaware,District of
Columbia, Kentucky and Tennessee. During that
time, he worked on numerous Board committees,
including Technology, Merchandising/Advertising,
Market Development/Retail Support, International
and Compensation, Audit and Executive. Mr. Jung
has been nominated for a non-dealer director
position for a term of three years.
Region -. Third and 3 years Mario R. Nathusius, 54, owns six Ace stores
ranging in size from 20,000 sq. ft. to 80,000
sq. ft. in Guatemala and is the 1997
(Picture of Mario R. International Dealer of the Year Award winner.
Nathusius) He is one of the first international dealer
members, having affiliated with Ace in 1978.
Mr. Nathusius has worked as general manager of
an investment firm and a textile manufacturer,
both in Guatemala. From 1973 to 1976, he
served as Consul of Guatemala to Canada. In
1978, he established CEMACO Co. Mr. Nathusius
has served on the Board of the Guatemala
Educational Foundation and was a founding
member and Vice President of the Stock
Exchange in Guatemala. Currently, he serves
on a number of boards, including Grupo PRO,
Banco Empresarial, and Industrious Rio Dulce.
He is fluent in Spanish, English and German.
Mr. Nathusius has been nominated for a dealer
director at-large position for a term of three
years.
Region -, Third and 3 years Roger E. Peterson, 60, has served as non-dealer
director for the Board of Directors since 1995,
following his retirement as Ace's chief
(Picture of Roger E. executive officer. He currently is chairman
Peterson) of the Wholesale Success committee. Mr.
Peterson held the position of chief executive
officer of Ace from 1990 to May 1995, and
President from 1986 through December 1994.
Other positions he held at Ace include
Executive Vice President, Vice President of
Operations and National Distribution Manager.
Prior to joining Ace, he was Executive Vice
President and General Manager of C/P Products
Corp., Elkhart, Ind. He also held other
management positions with companies such as
Montgomery Ward, J.C. Penney and Ben Franklin.
He is a graduate of the University of Miami
where he earned a degree in business
administration and was elected to the
University's Board of Trustees in 1995.
The principal occupation of Mr. Daniel L. Gust, Mr. Lawerence R. Bowman,
Mr. Howard J. Jung and Mr. Mario R. Nathusius during the past 5 years or
more consisted of being an owner, officer or manager of a retail hardware
business. The principal occupation of Mr. Roger E. Peterson during the past
five years consisted of being President and CEO and director of Ace Hardware
Corporation.
If any nominee named above shall refuse or be unable to serve as a director,
an event not now anticipated by the Board of Directors, it is intended that
the persons named in the proxy will vote for the election in his/her stead of
such substitute nominee as shall be designated by the Board.
OTHER MATTERS
As of the date of the notice of the annual meeting of stockholders, the Board
of Directors knows of no matters to be brought before the meeting other than
those described above. If, however, any additional matters are presented by
others, the proxy holders have been vested by the Board of Directors with
discretionary powers to vote the shares represented by the proxies held by
them in accordance with their own best judgment with respect to all such
matters.
By Order of the Board of Directors
DAVID W. LEAGUE
April 3, 1998 Secretary
ANNUAL STOCKHOLDERS MEETING
MONDAY, JUNE 1, 1998
The Annual Stockholders' Meeting of ACEHARDWARE CORPORATION will be held on
MONDAY, JUNE 1, 1998 in the ACE CORPORATE OFFICES, 2200 Kensington Court,
KRAUSMAN HALL - 3rd Floor, Oak Brook, Illinois.
You are invited to join the Ace Staff for a Continental Breakfast at 8:30
A.M. The business meeting will begin promptly at 9:00 A.M.
IF YOU PLAN TO ATTEND, please return the Reservation Form so that proper
arrangements can be made for the breakfast and meeting.
Please Note: Ace Hardware has adopted a "Tobacco Free Policy," which became
effective several years ago. There is NO SMOKING PERMITTED ANYWHERE WITHIN
OUR CORPORATE OFFICE FACILITIES.
Your efforts in maintaining a healthier, smoke-free work environment are
appreciated by the Company and employees.
ANNUAL STOCKHOLDERS MEETING
MONDAY, JUNE 1, 1998
Please reserve _____ places for the following persons who plan to
attend the Continental Breakfast and Annual Meeting.
______________________________
______________________________
______________________________
______________________________
Return form to:
Ace Hardware Corporation
2200 Kensington Court
Oak Brook, Illinois 60523
Attn: Chairman's Office
ACE HARDWARE CORPORATION PROXY
This proxy is solicited on behalf of the Board of Directors
for the annual meeting of stockholders on June 1, 1998.
As the holder, or the authorized agent of the holder, of 1 share of Class A
stock of Ace Hardware Corporation issued as of the record date of April 3,
1998 for the Ace store designated by the number shown on the reverse side
hereof, the undersigned does hereby constitute and appoint Jennifer C.
Anderson, Mark Jeronimus and D. William Hagan and each of them, with each to
have full power of substitution, as Proxies to vote said share of stock at
the annual meeting of stockholders of Ace Hardware Corporation to be held at
9:00 A.M. on Monday, June 1, 1998, and at any adjournment thereof, on all
matters coming before said meeting. If no directions are given on the other
side of this card, the Proxies will vote for the election of all director
nominees recommended by the Board of Directors and in their discretion on any
other business that may properly come before the meeting. The Proxies
appointed herein may act by a majority of such of said Proxies as shall be
present at the meeting (or if only one is present then by that one). Any
prior Proxies given by the undersigned with respect to said meeting are hereby
revoked.
(Continued and to be signed on the reverse side)
(Continued from the other side)
Election of Directors:
__ FOR all nominees listed below
(except as marked to the contrary below)
__ WITHHOLD AUTHORITY to vote for all nominees listed below
(To withhold authority to vote for any individual nominee,
strike a line through the nominee's name in the list below.)
Daniel L. Gust, Lawrence R. Bowman, Mario R. Nathusius,
Howard J. Jung, Roger E. Peterson
Dated:________________
(Legal corporate, partnership or business name)
Ace Store #_________
By
(In the case of a corporate or partnership
stockholder, an appropriate officer or
partner should sign and his title should be
inserted. If the stock is held in joint
tenancy, each holder should sign.)
