<PAGE> 1
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:
<TABLE>
<S> <C>
/ / 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 Rule 14a-11(c) or Rule 14a-12
</TABLE>
HAVERTY FURNITURE COMPANIES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/X/ 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:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
HAVERTY FURNITURE COMPANIES, INC.
866 West Peachtree Street, N.W.
Atlanta, Georgia 30308
ANNUAL MEETING OF STOCKHOLDERS
APRIL 28, 1995
TO THE STOCKHOLDERS:
Notice is hereby given that the Annual Meeting of Stockholders of
Haverty Furniture Companies, Inc., a Maryland corporation (the "Company"), will
be held at 11:00 A.M., on Friday, April 28, 1995, at the Harbor Court Hotel,
550 Light Street, Baltimore, Maryland 21202, for the following purposes:
1. To elect thirteen directors for terms of one year and until
their successors are elected and qualified, four of whom shall
be elected by holders of Common Stock and nine of whom shall be
elected by holders of Class A Common Stock.
2. To approve an amendment to the Company's Articles of
Incorporation to increase the number of authorized shares of
Common Stock from 15,000,000 to 50,000,000 and to increase the
number of authorized shares of Class A Common Stock from
5,000,000 to 15,000,000 as set forth in the Proxy Statement.
3. To transact such other business as may properly be brought
before the meeting or any adjournment thereof.
Only stockholders of record at the close of business on March 10,
1995, are entitled to notice of, and to vote at, the meeting.
Your attention is directed to the attached Proxy Statement.
By order of the Board of Directors
Christine M. Jones
Vice President and Secretary
Atlanta, Georgia
March 22, 1995
PLEASE FILL IN, SIGN, DATE AND RETURN THE ACCOMPANYING PROXY. IF YOU ATTEND
THE MEETING IN PERSON, YOU MAY WITHDRAW YOUR PROXY AND VOTE YOUR OWN SHARES.
<PAGE> 3
HAVERTY FURNITURE COMPANIES, INC.
866 West Peachtree Street, N.W.
Atlanta, Georgia 30308
ANNUAL MEETING OF STOCKHOLDERS
April 28, 1995
------------------------------
PROXY STATEMENT
------------------------------
SOLICITATION OF PROXIES
The enclosed proxy is solicited by the Board of Directors of Haverty
Furniture Companies, Inc., in connection with the Annual Meeting of
Stockholders to be held at the time and place and for the purposes set forth in
the accompanying notice. All shares represented by duly furnished proxies will
be voted in accordance with the instructions given therein.
Any proxy given pursuant to this solicitation may be revoked by any
stockholder who attends the meeting and gives oral notice of his election to
vote in person, without compliance with any other formalities. In addition,
any proxy given pursuant to this solicitation may be revoked prior to the
meeting by delivering to the Secretary of the Company an instrument revoking it
or a duly executed proxy for the same shares bearing a later date. Proxies
which are returned properly executed and not revoked will be voted in
accordance with the stockholder's directions specified thereon. Where no
direction is specified, proxies will be voted FOR each of the matters set forth
in the Notice accompanying this proxy statement. Abstentions and broker
non-votes will not be counted as votes either in favor of or against the matter
with respect to which the abstention or broker non-vote relates; however, with
respect to any proposal other than the election of directors, abstentions and
broker non-votes would have the effect of a vote against the proposal. All
costs of this solicitation will be borne by the Company.
Only stockholders of record at the close of business on March 10,
1995, are entitled to notice of, and to vote at, the meeting. The Annual
Report to Stockholders, Notice of Annual Meeting of Stockholders, this Proxy
Statement and form of Proxy were first mailed to stockholders of the Company on
or about March 22, 1995.
OUTSTANDING CAPITAL STOCK
As of the close of business on March 10, 1995, there were outstanding
and entitled to vote at the 1995 Annual Meeting of Stockholders 8,442,684
shares of the Company's $1.00 par value Common Stock and 3,058,951 shares of
the Company's $1.00 par value Class A Common Stock, the Company's only
outstanding classes of voting securities.
With respect to all stockholder matters, holders of Common Stock are
entitled to one vote for each share held. With respect to the election of
directors, holders of Class A Common Stock are entitled to one vote for each
share held; on all other matters, holders of Class A Common Stock are entitled
to ten votes for each share held.
The holders of Common Stock and Class A Common Stock vote as separate
classes in the election of directors. The holders of Common Stock are entitled
to elect 25% of the members of the Board of Directors, or the nearest higher
whole number that is at least 25% of the total number of directors standing for
election; and holders of Class A Common Stock are entitled to elect 75% of the
members of the Board of Directors, or the remaining number of directors
standing for election. The Common Stock carries a dividend preference over the
Class A Common Stock.
<PAGE> 4
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following information is provided with respect to all persons
known to the Company to be the beneficial owners of more than five percent (5%)
of the Company's Common Stock and/or Class A Common Stock as of March 10, 1995.
Unless otherwise indicated, the person or entity shown possesses sole voting
and investment powers with respect to the amounts shown.
<TABLE>
<CAPTION>
Class A
Common Stock Common Stock
Beneficially Beneficially
Owned and Owned and
Name and Address of Percent Percent
Beneficial Owner of Class of Class
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
Rawson Haverty * 776,727 (a)
866 West Peachtree Street, N.W. 25.39%
Atlanta, Georgia 30308
Frank S. McGaughey, Jr. * 204,255
3180 Lemons Ridge 6.68%
Atlanta, Georgia 30339
Clarence H. Ridley * 245,405 (b)
191 Peachtree Street 8.02%
Atlanta, Georgia 30303
John Rhodes Haverty, M.D. * 240,011
3359 Woodhaven Road, N.W. 7.88%
Atlanta, Georgia 30305
Mrs. Betty Haverty Smith * 255,589 (c)
158 West Wesley Road, N.W. 8.36%
Atlanta, Georgia 30305
Bank South, N.A. * 253,822 (d)
P. O. Box 4387 8.30%
Atlanta, Georgia 30302
Gardner Lewis Asset Management 724,937 (e) *
285 Wilmington-West Chester Pike 8.59%
Chadds Ford, Pennsylvania 19317
</TABLE>
__________________________
* Less than 5% of outstanding shares of class.
__________________________
(a) Of this amount, Mr. Haverty has sole voting and investment
power with respect to 411,623 shares, sole investment power
with respect to 4,662 shares, shared voting and investment
power with respect to 218,767 shares, and shared voting power
with respect to 141,675 shares.
-2-
<PAGE> 5
(b) Of this amount, Mr. Ridley has sole voting and investment
power with respect to 182,926 shares, shared voting and
investment power with respect to 1,327 shares, and sole voting
power with respect to 61,152 shares. This amount includes
unexercised options to purchase 6,000 shares.
(c) Of this amount, Mrs. Smith has sole voting and investment
power with respect to 248,229 shares and shared voting and
investment power with respect to 7,360 shares. This amount
excludes 57,332 shares held by Mrs. Smith's spouse, Alex W.
Smith, currently a director of the Company, who will retire on
April 28, 1995.
(d) Of this amount, Bank South, N.A., in various fiduciary
capacities, has sole voting power with respect to 6,637
shares, sole investment power with respect to 143,650 shares,
and shared voting and investment power with respect to 105,510
shares. Of the total number shown, 251,847 shares are also
included in the total shown for Rawson Haverty and 300 shares
are also included in the total shown for Lynn H. Johnston.
See "Election of Directors."
(e) Gardner Lewis Asset Management is an investment adviser
registered under Section 203 of the Investment Advisers Act of
1940. Gardner Lewis Asset Management has sole voting power
with respect to 563,137 shares, shared voting power with
respect to 28,050 shares, and sole investment power with
respect to 724,937 shares.
The following information is provided with respect to the number of
shares of the Company's Common Stock and Class A Common Stock beneficially
owned as of March 10, 1995, by (i) two executive officers who are not directors
and are named in the Summary Compensation Table, (ii) two directors who are not
standing for re-election, and (iii) all executive officers and directors as a
group. Unless otherwise indicated, the person or entity shown possesses sole
voting and investment powers with respect to the amounts shown.
<TABLE>
<CAPTION>
Class A
Common Stock Common Stock
Beneficially Beneficially
Owned and Owned and
Name or Number of Percent Percent
Persons in Group of Class of Class
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
Dennis L. Fink 38,365 (a) --
.45%
M. Tony Wilkerson 28,450 (b) 7,477 (c)
.34% .24%
Frank S. McGaughey, Jr. 107,489 (d) 204,255
1.27% 6.68%
Alex W. Smith 44,199 (e) 64,692 (f)
.52% 2.11%
26 Executive Officers and Directors as a Group 1,008,805 (g) 1,873,430 (h)
11.95% 61.24%
</TABLE>
-3-
<PAGE> 6
__________________________
(a) This amount includes unexercised options to purchase 11,491
shares.
(b) This amount includes unexercised options to purchase 27,491
shares.
(c) Mr. Wilkerson has sole voting and investment power with
respect to 7,357 shares and shared voting and investment power
with respect to 120 shares.
(d) Of this amount, Mr. McGaughey has sole voting and investment
power with respect to 92,303 shares and shared voting and
investment power with respect to 15,186 shares. This amount
includes unexercised options to purchase 28,000 shares.
(e) Of this amount, Mr. Smith has sole voting and investment power
with respect to 27,000 shares and shared voting and investment
power with respect to 17,199 shares. This amount includes
unexercised options to purchase 21,000 shares.
(f) Of this amount, Mr. Smith has sole voting and investment power
with respect to 57,332 shares and shared voting and investment
power with respect to 7,360 shares. This amount includes
unexercised options to purchase 6,000 shares.
(g) Of this amount, the persons included in this group have sole
voting and investment power with respect to 628,725 shares,
shared voting and investment power with respect to 214,514
shares, sole investment power with respect to 750 shares, and
shared voting power with respect to 164,816 shares. This
amount includes unexercised options to purchase 392,616
shares.
(h) Of this amount, the persons included in this group have sole
voting and investment power with respect to 1,379,513 shares,
shared voting and investment power with respect to 286,428
shares, sole investment power with respect to 4,662 shares,
sole voting power with respect to 61,152 shares, and shared
voting power with respect to 141,675 shares. This amount
includes unexercised options to purchase 37,500 shares.
-4-
<PAGE> 7
AGENDA ITEM ONE
ELECTION OF DIRECTORS
The Board of Directors is presently comprised of fourteen members.
All directors of the Company are to be elected annually, with stockholders of
each of the two classes of common stock voting separately by class as provided
in the Articles of Incorporation. The holders of Common Stock of the Company
are entitled to elect 25% of the members of the Board of Directors, or the
nearest higher whole number that is at least 25% of the total number of
directors standing for election; and the holders of Class A Common Stock of the
Company are entitled to elect 75% of the members of the Board of Directors, or
the remaining number of directors standing for election.
The Board of Directors has nominated thirteen persons for election as
directors at the 1995 Annual Meeting of Stockholders, four of whom will be
elected by the holders of Common Stock and nine of whom will be elected by the
holders of Class A Common Stock.
Frank S. McGaughey, Jr., who retired as the Company's President and
Chief Executive Officer on March 31, 1994, is retiring as a Director of the
Company effective with the expiration of his term at the 1995 Annual Meeting,
having served on the Board of Directors since April 1961. Alex W. Smith, who
has served as a Director of the Company since April 1967, is also retiring from
his position as a Director of the Company effective with the expiration of his
term at the 1995 Annual Meeting. The Board of Directors has nominated Frank S.
McGaughey, III, son of Frank S. McGaughey, Jr., and a partner of the law firm
of Powell, Goldstein, Frazer & Murphy, to stand for election as a Director of
the Company at the 1995 Annual Meeting.
Unless otherwise instructed, it is intended that proxies will be voted
FOR the election of the thirteen nominees named below. The affirmative vote of
a majority of all votes cast at the meeting by the holders of Class A Common
Stock is required for the election of the nine nominees standing for election
by the holders of that class. The affirmative vote of a majority of all votes
cast at the meeting by the holders of Common Stock is required for the election
of the four nominees standing for election by the holders of that class.
NOMINEES FOR ELECTION BY HOLDERS OF CLASS A COMMON STOCK
The names of, and certain information relating to, the nine nominees
to be elected by the holders of Class A Common Stock are as follows:
<TABLE>
<CAPTION>
Security Ownership
as of 3-10-95
and Percent of Class*
----------------------------------
Class A
Name and Year Age Common Common
First Became a Director (3-10-95) Principal Occupation Stock Stock
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Rawson Haverty (a) 74 Chairman of the Board of 209,739 (b) 776,727 (c)
1947 Company since 1984; President 2.48% 25.39%
(1955-1984) and Chief
Executive Officer (1955-1990)
of Company
</TABLE>
-5-
<PAGE> 8
<TABLE>
<CAPTION>
Security Ownership
as of 3-10-95
and Percent of Class*
----------------------------------
Class A
Name and Year Age Common Common
First Became a Director (3-10-95) Principal Occupation Stock Stock
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
John Rhodes Haverty, M.D.(d) 68 Retired (Former Dean, 19,146 (e) 241,011
1974 College of Health Sciences, .23% 7.88%
Georgia State University)
(1968-1991)
Clarence H. Ridley (f) 52 Partner of King & Spalding, 20,005 (g) 245,405 (h)
1979 Attorneys, since 1977 .24% 8.02%
Fred J. Bates 59 Regional Manager and General 33,607 39,823
1981 Manager of Company's Dallas, .40% 1.31%
Texas, operations since 1979
John E. Slater, Jr. 60 President and Chief Executive 56,383 (i) 15,960 (j)
1983 Officer of Company since .67% .52%
April 1, 1994; Executive Vice
President (1993-1994) and
Chief Operating Officer
(1992-1994); Senior Vice
President (1987-1993);
General Manager, Stores
(1990-1992)
Lynn H. Johnston (k) 63 Chairman of the Board of ING 153,441 (m) 9,300 (n)
1986 America Life Corporation 1.82% .30%
(formerly the GeorgiaUS
Corporation, re-named in
1993) since 1983; Deputy
Chairman and President of
Nationale-Nederlanden North
America Corporation (1989-
1992); Chairman of the Board
of Life Insurance Company of
Georgia (1983-1994) (l)
Clarence H. Smith (o) 44 Vice President, Operations 25,112 (p) 40,896 (q)
1989 and Development, of Company .30% 1.34%
since 1994; Vice President
(1984-1994); Regional Manager
and General Manager of
Company's Atlanta, Georgia,
operations (1986-1994)
</TABLE>
-6-
<PAGE> 9
<TABLE>
<CAPTION>
Security Ownership
as of 3-10-95
and Percent of Class*
----------------------------------
Class A
Name and Year Age Common Common
First Became a Director (3-10-95) Principal Occupation Stock Stock
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Rawson Haverty, Jr. (r) 38 Vice President, Real Estate 20,388 (s) 73,912 (t)
1992 and Insurance Divisions of .24% 2.42%
Company since 1992; Assistant
Vice President (1987-1992);
Assistant Secretary (1985-
1993)
Frank S. McGaughey, III (u) 46 Partner of Powell, Goldstein, 14,391 (v) --
Frazer & Murphy, Attorneys, .17%
since 1980
</TABLE>
__________________________
* Unless otherwise indicated, the amounts shown in the columns
represent the number of shares over which the nominee has sole
voting and investment power and include, where applicable,
shares subject to unexercised options.
__________________________
(a) Rawson Haverty is first cousin of Frank S. McGaughey, Jr., and
brother in-law of Alex W. Smith, both of whom will retire from
the Company's Board of Directors on April 28, 1995. Mr.
Haverty is also first cousin of John Rhodes Haverty, M.D.,
father of Rawson Haverty, Jr., and uncle of Clarence H. Ridley
and Clarence H. Smith.
(b) Of this amount, Mr. Haverty has sole voting and investment
power with respect to 93,506 shares, sole investment power
with respect to 750 shares, shared voting and investment power
with respect to 81,808 shares, and shared voting power with
respect to 33,675 shares. This amount includes unexercised
options to purchase 38,875 shares.
(c) Of this amount, Mr. Haverty has sole voting and investment
power with respect to 411,623 shares, sole investment power
with respect to 4,662 shares, shared voting and investment
power with respect to 218,767 shares, and shared voting power
with respect to 141,675 shares.
(d) John Rhodes Haverty, M.D., is first cousin of Rawson Haverty
and Frank S. McGaughey, Jr. (who will retire as a director of
the Company on April 28, 1995).
(e) This amount includes unexercised options to purchase 7,500
shares.
(f) Mr. Ridley is the nephew of Rawson Haverty and first cousin of
Clarence H. Smith and Rawson Haverty, Jr.
(g) Of this amount, Mr. Ridley has sole voting and investment
power with respect to 18,678 shares and shared voting and
investment power with respect to 1,327 shares. This amount
includes unexercised options to purchase 7,500 shares.
-7-
<PAGE> 10
(h) Of this amount, Mr. Ridley has sole voting and investment
power with respect to 182,926 shares, shared voting and
investment power with respect to 1,327 shares, and sole voting
power with respect to 61,152 shares. This amount includes
unexercised options to purchase 6,000 shares.
(i) Of this amount, Mr. Slater has sole voting and investment
power with respect to 17,437 shares, and shared voting and
investment power with respect to 38,946 shares. This amount
includes unexercised options to purchase 17,287 shares.
(j) Of this amount, Mr. Slater has sole voting and investment
power with respect to 150 shares and shared voting and
investment power with respect to 15,810 shares.
(k) Mr. Johnston is a director of Bank South Corporation.
(l) ING America Life Corporation (a subsidiary of Internationale
Nederlanden Group) is the holding company for Life Insurance
Company of Georgia, Southland Life Insurance Company and
Security Life of Denver. Internationale Nederlanden Group is
an international diversified financial services company based
in The Hague, the Netherlands, with banking and insurance
operations in 47 countries.
(m) Of this amount, Mr. Johnston has sole voting and investment
power with respect to 22,300 shares and shared voting power
with respect to 131,141 shares. This amount includes
unexercised options to purchase 21,000 shares.
(n) This amount includes unexercised options to purchase 6,000
shares.
(o) Clarence H. Smith is the nephew of Rawson Haverty, first
cousin of Clarence H. Ridley and Rawson Haverty, Jr., and son
of Alex W. Smith (who will retire as a director of the Company
on April 28, 1995).
(p) Of this amount, Mr. Smith has sole voting and investment power
with respect to 24,962 shares and shared voting and investment
power with respect to 150 shares. This amount includes
unexercised options to purchase 9,000 shares.
(q) Of this amount, Mr. Smith has sole voting and investment power
with respect to 40,171 shares and shared voting and investment
power with respect to 725 shares.
(r) Rawson Haverty, Jr., is the son of Rawson Haverty and first
cousin of Clarence H. Ridley and Clarence H. Smith.
(s) This amount includes unexercised options to purchase 15,000
shares.
(t) Of this amount, Mr. Haverty has sole voting and investment
power with respect to 73,437 shares and shared voting and
investment power with respect to 475 shares.
(u) Frank S. McGaughey, III, is the son of Frank S. McGaughey,
Jr., who will retire as a director of the Company on April 28,
1995.
(v) Mr. McGaughey shares voting and investment power with respect
to these shares.
-8-
<PAGE> 11
NOMINEES FOR ELECTION BY HOLDERS OF COMMON STOCK
The names of, and certain information relating to, the four nominees
to be elected by the holders of Common Stock are as follows:
<TABLE>
<CAPTION>
Security Ownership
as of 3-10-95
and Percent of Class*
--------------------------------
Class A
Name and Year Age Common Common
First Became a Director (3-10-95) Principal Occupation Stock Stock
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Dr. Kenneth Black, Jr. (a) 70 Regents' Professor Emeritus, 16,897 (b) 3,397 (c)
1975 Georgia State University .20% .11%
since 1992; Regents'
Professor of Insurance,
Georgia State University
(1959-1992); C.V. Starr Chair
of International Insurance
(1984-1992)
William A. Parker, Jr. (d) 67 Chairman of the Board of 28,500 (e) 6,000 (f)
1987 Seminole Investment Company, .34% .20%
L.L.C., since 1994; Chairman
of the Board of Cherokee
Investment Co. (1978-1994)
Robert R. Woodson (g) 62 Chairman of the Board of 28,500 (h) 9,000 (i)
1987 John H. Harland Company since .34% .29%
1992, President since 1984,
and Chief Executive Officer
since 1990; Chief Operating
Officer (1984-1990)
L. Phillip Humann (j) 49 President, SunTrust Banks, 14,500 (k) --
1992 Inc., since 1991; Senior .17%
Executive Vice President,
Banking (1990-1991);
Executive Vice President
(1989-1990)
</TABLE>
__________________________
* Unless otherwise indicated, the amounts shown in the columns
represent the number of shares over which the nominee has sole
voting and investment power and include, where applicable,
shares subject to unexercised options.
__________________________
(a) Dr. Black is a director of USLIFE Corporation, Alexander and
Alexander Services, Inc., and Scudder Variable Life Investment
Fund.
(b) This amount includes unexercised options to purchase 16,500
shares.
-9-
<PAGE> 12
(c) This amount includes unexercised options to purchase 3,000
shares.
(d) Mr. Parker is a director of Genuine Parts Co., The Southern
Company, Georgia Power Company, ING America Life Corporation
and Post Properties, Inc.
(e) This amount includes unexercised options to purchase 21,000
shares.
(f) This amount represents unexercised options to purchase 6,000
shares.
(g) Mr. Woodson is a director of NationsBank of Georgia, N.A., and
Allied Holdings, Inc.
(h) This amount includes unexercised options to purchase 21,000
shares.
(i) This amount represents unexercised options to purchase 6,000
shares.
(j) Mr. Humann is a director of SunTrust Banks, Inc., Coca-Cola
Enterprises, Inc., and Equifax, Inc.
(k) This amount includes unexercised options to purchase 12,000
shares.
-10-
<PAGE> 13
BOARD COMMITTEES AND ATTENDANCE
The Company has a standing Audit Committee composed of Dr. Kenneth
Black, Jr., Chairman, William A. Parker, Jr., and L. Phillip Humann. The Audit
Committee, which held two meetings during fiscal 1994, performs the following
functions: recommends independent certified public accountants to be engaged
as auditors of the Company; approves the fees of the Company's auditors;
reviews with the independent auditors the plan and results of the auditing
engagement; reviews the scope and results of the Company's procedures for
internal auditing; and reviews the adequacy of the Company's system of internal
accounting controls.
The Executive Committee is composed of Rawson Haverty, Chairman, John
E. Slater, Jr., Frank S. McGaughey, Jr., Alex W. Smith and Clarence H. Ridley.
The Executive Committee held five meetings during fiscal 1994.
The Company has no standing compensation committee; however, the
Executive Committee determines salary and bonus arrangements for certain
personnel. See "Report of Executive Committee on Executive Compensation."
The Company has a Stock Option Committee, composed of non-employee
directors appointed by the Board, which serves to administer the Company's
qualified and non-qualified stock option plans and the employee stock purchase
plan. Present members of the Stock Option Committee are John Rhodes Haverty,
M.D., Chairman, William A. Parker, Jr., and Robert R. Woodson. The Stock
Option Committee held three meetings during fiscal 1994.
The Company has a standing Employee Benefits Committee composed of
Lynn H. Johnston, Chairman, John Rhodes Haverty, M.D., and Robert R. Woodson.
The Employee Benefits Committee serves as Administrator for all formal employee
benefit plans of the Company and also oversees and gives guidance for all other
employee benefit programs and policies of the Company. The Employee Benefits
Committee held no formal meetings during fiscal 1994.
The Company has no standing nominating or other standing committee
performing similar functions.
The Board of Directors held a total of four meetings during fiscal
1994. Each incumbent director attended at least 75% of the aggregate of all
meetings held by the Board of Directors and by committees of the Board on which
the director served during the director's period of service.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors, certain officers and persons who own more than 10% of the
outstanding Class A Common Stock or Common Stock of the Company, to file with
the Securities and Exchange Commission reports of changes in ownership of the
Class A Common Stock or Common Stock of the Company held by such persons.
Officers, directors and greater than 10% stockholders are also required to
furnish the Company with copies of all forms they file under this regulation.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and representations that no other reports were
required during the fiscal year ended December 31, 1994, the Company's
officers, directors and 10% stockholders complied with all Section 16(a) filing
requirements applicable to them.
-11-
<PAGE> 14
EXECUTIVE COMPENSATION
The following table provides certain summary information concerning
compensation paid or accrued by the Company to or on behalf of the Company's
Chief Executive Officer and each of the four other most highly compensated
executive officers of the Company (determined as of the end of the last fiscal
year) (hereinafter referred to as the "Named Executive Officers") for the
fiscal years ended December 31, 1994, 1993 and 1992. With respect to
compensation paid on behalf of the Company's Chief Executive Officer for the
fiscal year ended December 31, 1994, the table below includes compensation paid
to Frank S. McGaughey, Jr., who retired as Chief Executive Officer on March 31,
1994, and to John E. Slater, Jr., his successor, who served as Chief Executive
Officer for the remainder of fiscal year 1994.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term
Compensation
-----------------------------------------------------------
Annual Compensation Awards
-----------------------------------------------------------
Other Securities All
Annual Underlying Other
Name and Salary Bonus Compensation Options Compensation
Principal Position Year ($) ($) ($) (#) ($)(a)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
John E. Slater, Jr. 1994 $166,875 $250,000 (b) $ -- 20,000 $ 3,030
President and Chief 1993 130,000 170,000 -- 22,500 2,998
Executive Officer 1992 114,375 120,000 -- 18,000 2,909
(since 4/1/94)
Frank S. McGaughey, Jr. 1994 64,053 75,000 -- 28,000 144,487 (c)
former President and 1993 160,000 210,000 -- 30,000 2,998
Chief Executive Officer 1992 145,375 150,000 -- 22,500 2,909
(retired 3/31/94)
Dennis L. Fink (d) 1994 129,792 100,000 -- 30,000 3,080
Senior Vice President 1993 125,000 55,000 -- 30,000 -
and Chief Financial 1992 - - -- - -
Officer
M. Tony Wilkerson 1994 123,333 100,000 -- 20,000 3,151
Senior Vice President, 1993 84,792 50,000 -- 12,000 2,396
Marketing 1992 78,333 35,000 -- 9,000 2,059
Rawson Haverty 1994 75,000 100,000 (e) -- 25,000 139,147 (f)
Chairman of the Board 1993 75,000 150,000 (e) -- 13,875 133,048 (f)
of Directors 1992 62,917 75,000 (e) -- 22,500 146,153 (f)
Clarence H. Smith 1994 100,000 75,000 -- 17,000 2,963
Vice President, 1993 90,000 50,750 -- 9,000 2,667
Operations and 1992 80,000 43,500 -- 7,500 2,592
Development
</TABLE>
_______________________________
(a) With the exception of Frank S. McGaughey, Jr., and Rawson
Haverty, the amounts shown represent Company contributions to
the account of the Named Executive Officer pursuant to the
Company's 401(k) Plan.
-12-
<PAGE> 15
(b) Of this amount, $50,000 was awarded for services performed as
Chief Operating Officer during first quarter 1994 and $200,000
was awarded for services performed as Chief Executive Officer
for the remainder of fiscal year 1994.
(c) Of this amount, $33,394 represents a cash payment by the
Company authorized by the Executive Committee on January 17,
1994, to be paid to Frank S. McGaughey, Jr., on the date of
his retirement, March 31, 1994, equal to the amount of
unrealized profits on 16,697 incentive stock options
surrendered by him for cancellation on that date. This amount
also includes an aggregate of $108,129 paid to Mr. McGaughey
for the period April 1 through December 31 of fiscal year 1994
under the Company's Retirement Plan and Supplemental Executive
Retirement Plan following his retirement from the Company.
The remaining $2,964 represents the Company's contribution
pursuant to the 401(k) Plan.
(d) Dennis L. Fink was employed by the Company effective January
1, 1993.
(e) Under an Agreement between the Company and Rawson Haverty, the
Executive Committee did not defer any portion of the bonus
earned by Mr. Haverty for fiscal year 1992. Under such
Agreement, the Executive Committee deferred one-third of the
bonuses earned by Mr. Haverty for fiscal years 1993 and 1994,
or $50,000 and $33,333, respectively. Mr. Haverty did not
draw any amount of deferred compensation during 1994.
(f) For each of the fiscal years shown, the amounts include the
Company's contribution pursuant to the 401(k) Plan and the
total amount of retirement benefits paid to Mr. Haverty under
the Company's Retirement Plan and Supplemental Executive
Retirement Plan, as follows: for fiscal year 1994, $2,500 and
$136,647, respectively; for 1993, $2,998 and $130,050,
respectively; and for 1992, $2,909 and $143,244, respectively.
-13-
<PAGE> 16
STOCK OPTION PLANS
The following table provides certain information concerning individual
grants of stock options under the Company's 1988 Incentive Stock Option Plan
and 1993 Non-Qualified Stock Option Plan made during the fiscal year ended
December 31, 1994, to each of the Named Executive Officers:
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Alternative
Grant Date
Individual Grants Value (a)
- -------------------------------------------------------------------------------------------------------------
% of Total Grant Date
Number of Options Present Value
Securities Granted to (Using Black-
Underlying Employees Exercise or Scholes Option
Options in Fiscal Base Price Expiration Pricing Model)
Name Granted (#) Year ($ Per Share) Date ($)
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
John E. Slater, Jr. 20,000 5.7% $17.125 1-4-99 $ 14,400
Frank S. McGaughey, 25,000 7.1% 17.125 1-4-99 83,000
Jr. (b) 3,000 (c) 0.9% 12.25 10-31-99 7,530
Dennis L. Fink 20,000 5.7% 17.125 1-4-99 145,400
10,000 2.8% 14.125 5-6-99 62,600
M. Tony Wilkerson 10,000 2.8% 17.125 1-4-99 72,700
10,000 2.8% 12.00 10-14-99 52,300
Rawson Haverty 25,000 7.1% 17.125 1-4-99 181,750
Clarence H. Smith 7,000 2.0% 17.125 1-4-99 50,890
10,000 2.8% 12.00 10-14-99 52,300
</TABLE>
<TABLE>
<CAPTION>
Assumptions Used for Grant One Grant One* Grant Two Grant Three Grant Four
Black-Scholes Model (d) (e) (f) (g) (h)
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Grant Date: 1/4/94 1/4/94 5/6/94 10/14/94 10/31/94
Risk-Free Rate (i): 5.25% 3.47% 7.06% 7.62% 6.22%
Exercise Price: $17.125 $17.125 $14.125 $12.00 $12.25
Share Price on Grant Date: $17.125 $17.125 $14.125 $12.00 $12.25
Volatility (j): 0.48 0.48 0.49 0.49 0.49
Term (Years): 5 1 5 5 1
Dividend Yield: 1.60% 1.60% 1.90% 2.30% 2.20%
Black-Scholes Option Value: $7.27 $3.32 $6.26 $5.23 $2.51
</TABLE>
_________________________
(a) The dollar amounts under this column are the result of
calculations based upon the Black-Scholes pricing model and
are not intended to forecast possible future appreciation of
the market value of the Company's Common Stock.
-14-
<PAGE> 17
(b) Due to Mr. McGaughey's retirement and limited exercisability
of options granted in fiscal year 1994, the Black -Scholes
calculations reflect a one-year option term. See footnotes
(e) and (h).
(c) This option was granted to Mr. McGaughey as a non-employee
director, after his retirement as President and Chief
Executive Officer, along with automatic grants made to all
other non-employee directors under the terms of the 1993
Non-Qualified Stock Option Plan. See footnote (h).
(d) Grant One, made on January 4, 1994, included all Named
Executive Officers.
(e) Grant One*, reflects the option granted to Mr. McGaughey on
January 4, 1994. Due to his retirement on 4/28/95 and
required option exercise by 7/28/95, the option term and
risk-free rate for the Black-Scholes model have been modified
to reflect a one-year term.
(f) Grant Two was made on May 6, 1994, to Dennis L. Fink.
(g) Grant Three was made on October 14, 1994, to M. Tony Wilkerson
and Clarence H. Smith.
(h) Grant Four was made on October 31, 1994, to Frank S.
McGaughey, Jr. The Black-Scholes calculation reflects a
one-year option term to coincide with Mr. McGaughey's pending
retirement and the correspondingly reduced exercise period.
See footnotes (c) and (e).
(i) Based on US Stripped Treasury Securities with similar
maturities to the option terms.
(j) Based on 21 consecutive quarter-end stock prices and dividends
paid prior to each grant date.
_________________________
-15-
<PAGE> 18
OPTION GRANTS IN LAST FISCAL YEAR NOT IMMEDIATELY EXERCISABLE
The terms of the 1988 Incentive Stock Option Plan and the 1993
Non-Qualified Stock Option Plan generally provide that options granted are
immediately exercisable and are exercisable for a period of five years from the
date of grant. However, Internal Revenue Code provisions limit the dollar
amount of incentive stock options which may be first exercisable in any given
calendar year to $100,000. Due to this limitation, as well as exercise
restrictions placed on certain incentive stock options granted in fiscal year
1994, the following portions of the incentive stock options granted in 1994 to
the Named Executive Officers were not immediately exercisable, and the
schedules for first exercise of those specific portions that were not
immediately exercisable are as follows:
<TABLE>
<CAPTION>
Options Granted in 1994 Not Immediately Exercisable
-------------------------------------------------------
Number Date When
Date Exercise of Options
of Price Incentive First
Name Grant ($ Per Share) Options Exercisable
- -------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
John E. Slater, Jr. 1/4/94 $17.125 725 1/1/95
1/4/94 17.125 5,839 1/1/96
1/4/94 17.125 5,839 1/1/97
1/4/94 17.125 5,839 1/1/98
1/4/94 17.125 1,758 1/1/99
Frank S. McGaughey, Jr. -- -- -0- --
Dennis L. Fink 1/4/94 17.125 1,914 1/1/96
1/4/94 17.125 5,839 1/1/97
1/4/94 17.125 5,839 1/1/98
1/4/94 17.125 5,408 1/1/99
M. Tony Wilkerson 1/4/94 17.125 4,000 7/15/95
1/4/94 17.125 3,000 7/15/96
1/4/94 17.125 3,000 7/15/97
10/14/94 12.00 2,625 7/15/95
10/14/94 12.00 4,052 7/15/96
10/14/94 12.00 3,323 7/15/97
Rawson Haverty -- -- -0- --
Clarence H. Smith 1/4/94 17.125 2,800 7/15/95
1/4/94 17.125 2,100 7/15/96
1/4/94 17.125 2,100 7/15/97
10/14/94 12.00 4,337 7/15/95
10/14/94 12.00 5,336 7/15/96
10/14/94 12.00 327 7/15/97
</TABLE>
-16-
<PAGE> 19
The following table provides certain information concerning each
exercise of stock options under the Company's 1986 and 1988 Incentive Stock
Option Plans and 1986 Non-Qualified Stock Option Plan during the fiscal year
ended December 31, 1994, by each of the Named Executive Officers and the fiscal
year end value of unexercised options held by such persons under such Plans:
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
Options Exercised in 1994 All Outstanding Options
----------------------------------------------------------------------------------------
Number of Securities
Shares Value Underlying Unexercised Value of Unexercised In-
Acquired on Realized Options at Fiscal the-Money Options at Fiscal
Name Exercise (#) ($) (a) Year End (#) Year End ($) (b)
- ---------------------------------------------------------------------------------------------------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
John E. Slater, Jr. -0- $ -0- 15,563 26,937 $ -0- $ -0-
Frank S. McGaughey, 13,303 -0- 28,000 -0- -0- -0-
Jr.
Dennis L. Fink -0- -0- 27,756 32,244 3,125 -0-
M. Tony Wilkerson 12,750 65,750 27,000 20,000 88,750 -0-
Rawson Haverty -0- -0- 37,651 1,224 -0- -0-
Clarence H. Smith -0- -0- 9,000 27,000 -0- -0-
</TABLE>
______________________
(a) Dollar values were calculated by determining the difference
between the fair market value of the underlying securities at
exercise date and the exercise price of the options.
(b) Dollar values were calculated by determining the difference
between the fair market value of the underlying securities at
year end and the exercise price of the options.
-17-
<PAGE> 20
RETIREMENT PLAN
The Company maintains a tax-qualified, non-contributory defined
benefit retirement plan (the "Retirement Plan"). All employees of the Company
are eligible to participate upon completion of one year of service and reaching
age 21. Officers are eligible to participate in the Retirement Plan, but
directors are not eligible unless they are also full-time employees. Annual
contributions to the Retirement Plan are made in amounts determined by the
Retirement Plan's actuaries to be sufficient to fund the benefits to be paid
and to meet regulatory requirements.
The Retirement Plan provides for the payment of fixed monthly benefits
upon an employee's normal retirement at age 65. Benefits may also be paid upon
early retirement as provided in the Retirement Plan. Benefits upon retirement
are based upon years of service and final average earnings. "Final average
earnings" means the average annual earnings for the five consecutive years in
which a participant had the highest earnings during the last ten years of
employment. Compensation for purposes of computing annual benefits under the
Retirement Plan includes basic salary, wages, overtime pay, bonuses,
commissions, amounts contributed to the 401(k) plan by the employee and other
direct compensation included in the IRS Form W-2.
The table below illustrates the estimated annual benefits payable upon
retirement under the Retirement Plan to persons in specified years of service
and compensation categories. The benefits shown are straight-life annuities
and are based upon an assumed retirement during 1995. The compensation amounts
shown are compensation in the final year of employment. For purposes of
determining final average earnings, a 5% per year increase in earnings was used
for prior years. Earnings used to calculate benefits under the Retirement Plan
may not exceed $150,000 for 1994. Annual benefits under the Retirement Plan
may not exceed $118,800 for 1994, regardless of the benefit amount otherwise
produced by the Retirement Plan formula. Both of these amounts are subject to
future adjustments for cost of living increases. Annual benefits in the table
below do not reflect either of these limits, and are in addition to any amounts
payable from Social Security.
<TABLE>
<CAPTION>
Years of Service
1994 ----------------------------------------------------------------------------
Compensation 15 20 25 30 35 or More
------------ -------- -------- -------- -------- ----------
<S> <C> <C> <C> <C> <C>
$ 50,000 $ 5,557 $ 7,409 $ 9,261 $ 11,114 $ 12,966
100,000 13,058 17,410 21,763 26,115 30,468
150,000 20,558 27,411 34,264 41,117 47,970
200,000 28,059 37,412 46,765 56,119 65,472
250,000 35,560 47,413 59,267 71,120 82,974
300,000 43,061 57,415 71,768 86,122 100,475
350,000 50,562 67,416 84,270 101,123 117,977
400,000 58,063 77,417 96,771 116,125 135,479
450,000 65,563 87,418 109,272 131,127 152,981
500,000 73,064 97,419 121,774 146,128 170,483
550,000 80,565 107,420 134,275 161,130 187,985
</TABLE>
The years of service accrued to the Named Executive Officers are as
follows:
<TABLE>
<CAPTION>
Employee Years of Service Accrued as of 12/31/94
-------- ---------------------------------------
<S> <C>
John E. Slater, Jr. 38
Dennis L. Fink 2
M. Tony Wilkerson 18
Rawson Haverty 53
Clarence H. Smith 21
Frank S. McGaughey, Jr. Retired 3/31/94 with 47 Years of Service
</TABLE>
-18-
<PAGE> 21
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
In February 1984, the Board of Directors adopted a non-qualified
Supplemental Executive Retirement Plan (the "Supplemental Plan"), effective
January 1, 1983, for the benefit of Rawson Haverty (retired, but continues to
be employed by the Company on a consulting basis) and four other retired
executive officers and directors, including Frank S. McGaughey, Jr., who
retired from the Company on March 31, 1994. Under the terms of the
Supplemental Plan, a covered executive is eligible to receive a benefit,
beginning at actual retirement on or after his 65th birthday, based on final
average earnings (including salary and bonus) defined to be the highest average
total earnings for any five consecutive calendar years during the ten calendar
years immediately preceding retirement. The maximum benefit provided is equal
to 55% of final average earnings, as defined above, less (i) the amount payable
under the Company's Retirement Plan and (ii) the Primary Insurance Amount
payable from Social Security. Reduced benefits are payable upon retirement
prior to age 65.
The following table shows estimated annual benefits payable upon
retirement at age 65 to participants under the Supplemental Plan in specified
years of service and compensation classes. The amounts shown below will be
reduced by (i) the amount payable from the Retirement Plan and (ii) the
participant's Primary Insurance Amount payable from Social Security.
<TABLE>
<CAPTION>
1994 Years of Service
Compensation 15 or More
------------ ----------------
<S> <C>
$ 50,000 $ 25,003
100,000 50,005
150,000 75,008
200,000 100,011
250,000 125,014
300,000 150,016
350,000 175,019
400,000 200,022
450,000 225,025
500,000 250,027
550,000 275,030
</TABLE>
-19-
<PAGE> 22
COMPENSATION OF DIRECTORS
Each employee director earns an annual retainer fee of $3,000 for his
services. Each non-employee director earns an annual retainer fee of $13,000
and a fee of $600 for attendance at each Board meeting and each meeting of a
Board committee on which he serves, except that a non-employee director who
serves as chairman of a Board committee receives $700 for attendance at each
meeting of the committee which he chairs.
Pursuant to an automatic grant provision under the Company's 1993
Non-Qualified Stock Option Plan, the plan authorizes that each non-employee
director of the Company be granted, on a pre-determined date annually, an
option to purchase 3,000 shares of Common Stock at an exercise price equal to
100% of the fair market value of such stock on the date of grant. On October
31, 1994, options were granted to the then nine non-employee directors of the
Company covering an aggregate of 27,000 shares of Common Stock at a per share
exercise price of $12.25. Such options were granted to Dr. Kenneth Black, Jr.,
John Rhodes Haverty, M.D., L. Phillip Humann, Lynn H. Johnston, William A.
Parker, Jr., Clarence H. Ridley, Alex W. Smith, Robert R. Woodson and Frank S.
McGaughey, Jr., who retired from the Company on March 31, 1994.
The Company has a Directors' Deferred Compensation Plan that permits
directors to defer fees for services as directors and members of committees of
the Board of Directors. Amounts so deferred plus accrued interest (at a rate
determined annually by the Executive Committee in accordance with the Plan) may
be distributed to a director in one lump sum or in no more than ten equal
annual installments on any date or dates elected by the director.
-20-
<PAGE> 23
ADDITIONAL INFORMATION WITH RESPECT TO COMPENSATION COMMITTEE INTERLOCKS AND
INSIDER PARTICIPATION IN COMPENSATION DECISIONS
Although the Company does not have a Compensation Committee of the
Board of Directors, the Executive Committee has performed the function of
determining executive officer compensation. During the fiscal year ended
December 31, 1994, the Executive Committee was comprised of five members:
Rawson Haverty, Chairman of the Board; John E. Slater, Jr., who assumed the
position of President and Chief Executive Officer on April 1,1994; Frank S.
McGaughey, Jr., who retired from the Company on March 31, 1994, and who will
retire as a director on April 28, 1995; Alex W. Smith, who will retire as a
director on April 28, 1995; and Clarence H. Ridley.
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or the
Exchange Act that might incorporate future filings, including this Proxy
Statement, in whole or in part, the following Report of Executive Committee on
Executive Compensation and the Stockholder Return Performance Graph shall not
be incorporated by reference into any such filings.
REPORT OF EXECUTIVE COMMITTEE ON EXECUTIVE COMPENSATION
The Company has no standing compensation committee; however, the
Executive Committee of the Board of Directors determines salary and bonus
arrangements for all executive officers of the Company, including the Chief
Executive Officer, subject to approval by the full Board. The Executive
Committee is composed of Rawson Haverty, Chairman of the Board; John E. Slater,
Jr., President and Chief Executive Officer; Frank S. McGaughey, Jr., former
President and Chief Executive Officer (retired); Alex W. Smith; and Clarence H.
Ridley.
Compensation of store and regional managers consists of a base salary,
which is related to the size of the profit center managed, plus a bonus based
on a pre-set formula related to annual profits produced by such profit center.
Compensation of other officers, including executive officers and department
heads (approximately 25 persons including the five most highly compensated
officers), consists of a base salary, which is related to the duties and
responsibilities of the position, plus a bonus related to the profits of the
Company and assessment of individual contribution. Bonuses are determined
subjectively by the Executive Committee, subject to approval by the full Board
of Directors.
Determination of executive and key-person bonuses is made only after
all store and regional manager bonuses have been computed and deducted from
pre-tax earnings. From the remaining profit before taxes, a pool is created
for payment of executive and key-person bonuses. Total bonuses earned and paid
for fiscal year 1994 to 73 managers and other individuals amounted to
$2,543,000. Of this amount, 27.5% was paid to the six executive officers
holding the five most highly compensated positions during fiscal year 1994.
During fiscal year 1994, the position of President and Chief Executive Officer
was held by Frank S. McGaughey, Jr., until his retirement on March 31, 1994, at
which time John E. Slater, Jr., was elected by the Board of Directors of the
Company to that position.
The Chief Executive Officer's compensation, as well as that of the
other executive officers, is comprised of a base salary which is directly
related to the responsibilities of the position and a bonus which is related
primarily to the Company's performance. The principal burden of corporate
management decisions is carried by a Management Committee that is appointed by
the Chief Executive Officer and which is currently comprised of those executive
officers holding the positions of Chief Executive Officer, Chief Financial
Officer, Senior Vice President of Marketing, Vice President of Operations and
Development, and Vice President of the Real Estate and Insurance Divisions,
with the Chairman of the Board serving in an advisory capacity; however, the
Chief Executive Officer bears final responsibility for such management
decisions. Thus, the executive officers serving as the Management Committee,
together with the Chairman of the Board, participate more heavily in the
division of bonus awards. For
-21-
<PAGE> 24
fiscal year 1994, these executive officers, together with the Chairman of the
Board, received 30.5% of the total bonus awards.
Traditionally, the compensation of the Chief Executive Officer and
other executive officers has increased or decreased in relation to the
profitability of the Company, as well as its competitive position and likely
prospects based on the specific actions of management. When profits (on which
bonuses were computed) for the recession year of 1991 decreased 55.3% from the
prior year, the bonus of the Chief Executive Officer decreased 16.7%, as
compared to a decrease in overall bonuses of 22.1%. These bonus decreases were
less than the 1991 earnings decrease in recognition of competitive compensation
paid in the industry and the subjective assessment that significant positive
strategic marketing changes had been successfully implemented by management.
In 1992, corporate profits (on which bonuses were computed) increased 105.5%,
yet the bonus of the Chief Executive Officer increased only 20%, as compared to
an overall average increase in bonuses of only 12.1%. These lower bonus
increases were determined in light of the lower bonus reductions in 1991. In
1993, corporate profits (on which bonuses were computed) increased 86.8% from
the prior year; while the bonus of the Chief Executive Officer increased a more
modest 40%, and overall average bonuses increased 35.3%.
In 1994, corporate profits (on which bonuses were computed) increased
20.4% from the prior year, and actual net income of the Company increased
29.0%. The aggregate amount of $275,000 in bonus awarded and paid to Frank S.
McGaughey, Jr., and John E. Slater, Jr. ($75,000 and $200,000, respectively)
for their services during fiscal year 1994 as Chief Executive Officer increased
31% compared to the $210,000 bonus paid to Mr. McGaughey as Chief Executive
Officer in fiscal year 1993, and as compared to an overall average increase in
bonuses of 27.1%. An additional $50,000 bonus paid to John E. Slater, Jr., for
fiscal year 1994 was awarded to Mr. Slater for his services as Chief Operating
Officer during the first quarter of fiscal year 1994. Overall bonuses
increased somewhat more in 1994 than did earnings as the Executive Committee
believed the transition in leadership under the new Chief Executive Officer was
carried out in an excellent manner and in light of competitive compensation
levels.
Based upon a review of available information on public companies
reporting comparable amounts of annual gross revenues, the Executive Committee
believes that the cash compensation (salary and bonus) paid to the Chief
Executive Officer of the Company is moderate, as compared to the compensation
of the chief executive officers of other such companies.
The Company has been in business for 110 years. Throughout its long
history it has maintained employee compensation programs designed to encourage
its employees to become owners of the business in which they are employed.
Stock options for store managers, officers, and other key employees are awarded
in the discretion of the Stock Option Committee of the Board of Directors,
which is comprised of non-employee directors. A non-qualified stock option
plan is in place for non-employee directors, and in 1992 an employee stock
purchase plan was established for all eligible employees. As a result of this
long established policy, a substantial number of shares of Company Common Stock
and Class A Common Stock are held by those currently employed in the business
and by former Haverty Furniture Companies, Inc., employees.
It is the Company's intention that the compensation to be paid to its
executive officers will not exceed the present maximum allowable amount for
purposes of deductibility set forth in the Internal Revenue Code.
Executive Committee, Board of Directors
Rawson Haverty, Chairman John E. Slater, Jr. Alex W. Smith
Clarence H. Ridley Frank S. McGaughey, Jr.
-22-
<PAGE> 25
STOCKHOLDER RETURN PERFORMANCE GRAPH
The Company has selected a more specific peer index, the Nasdaq Home
Furnishings Stores Index, for its performance graph presented in this proxy
statement.
In prior years, an index of all Nasdaq companies engaged in retail
trade was used. The new peer index, shown in the first graph below, includes
the 32 active Nasdaq U.S. issues as of December 30, 1994, which carry a
Standard Industrial Classification (SIC) code of 5700-5799, defined as home
furniture, furnishings and equipment stores. This group includes several
retailers normally considered to be direct competitors of the Company.
The Nasdaq Retail Trade Index previously used, as shown in the second
graph below, is still an appropriate comparison; however, the Nasdaq Home
Furnishings Stores Index should more directly reflect similar economic
circumstances and common investment community perspective.
Set forth below is a line graph comparing the yearly percentage change
in the cumulative total stockholder return on the Company's Common Stock and
Class A Common Stock against the cumulative total return of the Nasdaq Home
Furnishings Stores Index and the Nasdaq U.S. Companies Index for the period of
five years commencing December 31, 1989, and ending December 31, 1994. The
graph assumes that the value of the investment in the Company's Common Stock or
Class A Common Stock and each index was $100 on December 31, 1989, and that all
dividends were reinvested.
COMPARISON OF FIVE YEAR TOTAL RETURN AMONG
HAVERTY FURNITURE COMPANIES, INC.
NASDAQ HOME FURNISHINGS STORES AND
NASDAQ U.S. COMPANIES INDICES
HAVERTY FURNITURE COMPANIES, INC.
Information for 1995 Proxy Statement
<TABLE>
<CAPTION>
$100 Value 1989 1990 1991 1992 1993 1994
- ---------- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Haverty Furniture Companies, Inc. - Common Stock $100.00 $ 74.95 $112.70 $189.92 $287.90 $201.31
Haverty Furniture Companies, Inc. - Class A Common 100.00 84.03 103.75 167.59 275.73 174.83
Nasdaq Home Furnishings Stores Index 100.00 81.92 157.48 187.92 184.21 140.23
Nasdaq U.S. Companies Index 100.00 84.92 136.28 158.58 180.93 176.91
Annual Return 1989 1990 1991 1992 1993 1994
- ------------- ---- ---- ---- ---- ---- ----
Haverty Furniture Companies, Inc. - Common Stock N/A -25% 50% 69% 52% -30%
Haverty Furniture Companies, Inc. - Class A Common N/A -16% 23% 62% 65% -37%
Nasdaq Home Furnishings Stores Index N/A -18% 92% 19% -2% -24%
Nasdaq U.S. Companies, Index N/A -15% 60% 16% 14% -2%
</TABLE>
-23-
<PAGE> 26
Set forth below is a line graph comparing, as in prior years, the
yearly percentage change in the cumulative total stockholder return on the
Company's Common Stock and Class A Common Stock against the cumulative total
return of the Nasdaq Retail Trade Index and the Nasdaq U.S. Companies Index for
the period of five years commencing December 31, 1989, and ending December 31,
1994. The graph assumes that the value of the investment in the Company's
Common Stock or Class A Common Stock and each index was $100 on December 31,
1989, and that all dividends were reinvested.
COMPARISON OF FIVE YEAR TOTAL RETURN AMONG
HAVERTY FURNITURE COMPANIES, INC.
NASDAQ RETAIL TRADE AND
NASDAQ U.S. COMPANIES INDICES
HAVERTY FURNITURE COMPANIES, INC.
Information for 1995 Proxy Statement
<TABLE>
<CAPTION>
$100 Value 1989 1990 1991 1992 1993 1994
- ---------- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Haverty Furniture Companies, Inc. - Common Stock $100.00 $ 74.95 $112.70 $189.92 $287.90 $201.31
Haverty Furniture Companies, Inc. - Class A Common 100.00 84.03 103.75 167.59 275.73 174.83
Nasdaq Retail Trade Index 100.00 98.97 187.99 176.92 187.07 170.54
Nasdaq U.S. Companies Index 100.00 84.92 136.28 158.58 180.93 176.91
Annual Return 1989 1990 1991 1992 1993 1994
- ------------- ---- ---- ---- ---- ---- ----
Haverty Furniture Companies, Inc. - Common Stock N/A -25% 50% 69% 52% -30%
Haverty Furniture Companies, Inc. - Class A Common N/A -16% 23% 62% 65% -37%
Nasdaq Retail Trade Index N/A -1% 90% -6% 6% -9%
Nasdaq U.S. Companies, Index N/A -15% 60% 16% 14% -2%
</TABLE>
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<PAGE> 27
AGENDA ITEM TWO
PROPOSAL TO AMEND ARTICLES OF INCORPORATION
TO INCREASE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
AND CLASS A COMMON STOCK
PROPOSED AMENDMENT
At a meeting of the Board of Directors of the Company held on November
4, 1994, the directors approved an amendment to the Sixth Article of the
Company's Articles of Incorporation, as amended, (the "Articles of
Incorporation") to increase the number of authorized shares of Common Stock of
the Company from 15,000,000 to 50,000,000 shares, and to increase the number of
authorized shares of Class A Common Stock from 5,000,000 to 15,000,000 shares.
As of March 10, 1995, the Company had only 6,557,316 and 1,941,049 shares of
authorized Common Stock and Class A Common Stock, respectively, remaining for
future issuance. Of the remaining shares of Common Stock and Class A Common
Stock available for issuance, 2,019,657 shares of Common Stock and 43,500
shares of Class A Common Stock are currently reserved for issuance pursuant to
currently outstanding stock options. In addition, shares of the Class A Common
Stock are convertible into shares of Common Stock on a share-for-share basis at
the election of the holder; therefore, a sufficient number of shares of
authorized Common Stock must be maintained for this purpose.
The Board of Directors of the Company believes that it is in the best
interests of the Company and its stockholders that there be a greater number of
authorized and unissued shares available to give the Company the flexibility it
needs to conduct its business and accommodate future growth. The Board of
Directors believes that the proposed increase in authorized shares of Common
Stock and Class A Common Stock is desirable to enhance the Company's
flexibility in structuring its future capitalization, to meet financing needs
for expansion and growth and for other corporate purposes which the Board may
deem desirable. In connection therewith, the following resolution will be
introduced at the Annual Meeting:
"RESOLVED: the existing Sixth Article of the Articles of
Incorporation is amended in the following respects:
(a) Part I, subsection A and sub-subsection (1) are amended as
follows:
"SIXTH
I
The authorized capital of the Corporation shall consist of 66,000,000
shares and shall be represented by the following securities:
A. 65,000,000 shares of $1 par value common stock divided into
two classes as follows:
(1) 50,000,000 shares of $1 par value common stock
designated as Common Stock and having the following attributes:"
(b) Part I, subsection A, sub-subsection (2) is amended as follows:
"(2) 15,000,000 shares of $1 par value common stock
designated as Class A Common Stock and having the following
attributes:"
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<PAGE> 28
The Board of Directors recommends that stockholders approve the
proposed amendment to the Company's Articles of Incorporation because it
considers the proposal to be in the best long-term and short-term interests of
the Company, its stockholders and its other constituencies. The purpose for
the proposed increase in the number of shares of authorized Common Stock and
Class A Common Stock is to ensure that additional shares of Common Stock and
Class A Common Stock will be available, if needed, for issuance in connection
with any possible future transactions approved by the Board of Directors and
permitted by the policies, rules and regulations of the National Association of
Securities Dealers, Inc. ("NASD"), including, among others, stock splits,
stock dividends, acquisitions, financings and other corporate purposes. The
Board of Directors believes that the availability of the additional shares of
Common Stock and Class A Common Stock for such purposes without delay or the
necessity for a special stockholders' meeting (except as may be required by
applicable law or regulatory authorities or by the rules of the NASD or any
stock exchange on which the Company's securities may then be listed) will be
beneficial to the Company by providing it with the flexibility required to
consider and respond to future business opportunities and needs as they arise.
The availability of additional authorized shares of Common Stock and Class A
Common Stock will also enable the Company to act promptly when the Board of
Directors determines that the issuance of additional shares of Common Stock and
Class A Common Stock is advisable. It is possible that shares of Common Stock
and Class A Common Stock may be issued at a time and under circumstances which
may increase or decrease earnings per share and increase or decrease the book
value per share of shares presently held. If the proposed amendment is
approved by stockholders, no further authorization for the issuance of the
newly authorized Common Stock and Class A Common Stock will be solicited prior
to such issuance.
The Company has no current plans to issue any of the additional
authorized shares of Common Stock or Class A Common Stock, should the proposed
amendment be approved by the Company's stockholders.
The proposed amendment to the Articles of Incorporation must be
approved by the affirmative vote of a majority of the aggregate number of votes
entitled to be cast thereon.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT THE COMPANY'S
STOCKHOLDERS VOTE FOR THE PROPOSED AMENDMENT TO THE ARTICLES OF INCORPORATION.
POLICY OF THE NASD RESPECTING SHAREHOLDER VOTING RIGHTS
For approximately the past four years, Schedule D to the By-laws of
the NASD has contained a rule or policy entitled "Prohibition Against
Shareholder Disenfranchisement" which applies to companies whose securities are
quoted on the NASDAQ National Market System (which includes the Company's
Common Stock and Class A Common Stock). This policy has been recently modified
by the NASD. In December 1994, the Securities and Exchange Commission approved
proposed rule changes of the NASD, the New York Stock Exchange and the American
Stock Exchange establishing a shareholder voting rights policy. The current
NASD policy (entitled "Voting Rights") prohibits an issuer from issuing any
class of security or taking other corporate action which has the effect of
nullifying, restricting or disparately reducing the per share voting rights of
the holders of an outstanding class of common stock of the issuer registered
under Section 12 of the Securities Exchange Act of 1934, as amended. Prior to
December 1994, under the NASD policy a company generally was prohibited from
issuing additional shares of super-voting or higher voting stock unless the
issuance did not further disenfranchise existing stockholders. In effect, a
company's existing dual class capital structure was permitted only as to shares
which were previously issued and were then outstanding in the market. Prior
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<PAGE> 29
to December 1994, under the former NASD policy the Company was prohibited from
issuing any additional shares of Class A Common Stock, which carries ten votes
per share, as compared to the Common Stock, which carries one vote per share.
The new NASD policy presumes that the following corporate actions
would violate the voting rights policy of the NASD:
(1) corporate action imposing restrictions on the voting power of
outstanding shares of Common Stock based on either the number of shares held by
the stockholder or the length of time such shares have been held by the
stockholder;
(2) the issuance of securities through an exchange offer for
shares of an outstanding class of Common Stock of the issuer in which the
securities issued have voting rights greater than or less than the per share
voting rights of any outstanding class of Common Stock of the issuer; or
(3) any issuance of securities pursuant to a stock dividend or
other type of stock distribution in which the securities issued have voting
rights greater than the per share voting rights of any outstanding class of
Common Stock of the issuer.
The following corporate actions are presumed not to violate the new
NASD policy:
(1) the issuance of securities pursuant to an initial registered
public offering;
(2) the issuance of any class of securities through a registered
public offering with voting rights not greater than the per share voting rights
of any outstanding class of Common Stock of the issuer;
(3) the issuance of any class of securities to effect a bona fide
merger or acquisition with voting rights not greater than the per share voting
rights of any outstanding class of the Common Stock of the issuer; or
(4) corporate action taken pursuant to state law under "control
share acquisition" statutes (which condition the voting rights of a beneficial
or record holder of a specified threshold percentage of a corporation's voting
stock on the approval of the corporation's independent stockholders).
The amended policy also contains additional guidelines to supplement
and clarify the application of the policy to, among other things, (1) issuers
with existing dual class structures, (2) review of past voting rights
activities, and (3) foreign issuers. The policy specifies that the restriction
against the issuance of super voting stock is primarily intended to apply to
the issuance of a new class of super voting stock. Companies with existing
dual class capital structures (including Haverty Furniture Companies, Inc.)
would generally be permitted to issue additional shares of a class of existing
super voting stock without conflict with the policy. According to an
interpretive release of the Securities and Exchange Commission approving the
new policy, the Commission stated "Under the policy, there will be no
restrictions on the ability of a dual class company to issue additional shares
of an existing class of higher voting stock in a capital-raising transaction,
via a stock dividend, through the issuance of stock options, or in a stock
split. Such a company would not be permitted however, to adopt a different
capital structure that reduces or restricts voting rights, such as a
time-phased voting plan, or the issuance of a third class of stock with greater
voting rights than shares of any existing class."
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<PAGE> 30
Under the amended policy it appears that the Company will be able to
issue additional shares of Class A Common Stock in certain permitted
capital-raising transactions, or through a stock dividend, the issuance of
stock options or a stock split. As stated above, however, the Company has no
current plans to issue any of the additional authorized shares of Common Stock
or Class A Common Stock.
DESCRIPTION OF COMMON STOCK AND CLASS A COMMON STOCK
The Company presently has authorized securities comprised of the
following: (i) 15,000,000 shares of $1.00 par value Common Stock, of which
8,442,684 shares were outstanding as of March 10, 1995, (ii) 5,000,000 shares
of $1.00 par value Class A Common Stock, of which 3,058,951 shares were
outstanding as of March 10, 1995 and (iii) 1,000,000 shares of $1.00 par value
Preferred Stock, none of which have been issued. The following descriptions of
the Common Stock and Class A Common Stock are qualified in all respects by
reference to the Articles of Incorporation and By-laws of the Company.
COMMON STOCK
In all elections of directors, the holders of Common Stock are
entitled, voting separately as a class, to elect 25% of the total number of
directors of the Company. If such 25% is not a whole number, then the holders
of Common Stock are entitled to elect the nearest higher whole number of
directors that is at least 25% of the total membership of the Board of
Directors. In all other matters, unless otherwise provided in the Articles of
Incorporation or as provided by law, each share of the Common Stock has one
vote and votes with all other classes of the common stock of the Company as a
single class.
The Common Stock is entitled to a dividend of at least 105% of any
dividend paid on the shares of Class A Common Stock (except dividends payable
in equity shares of the Company). The Board of Directors may declare and pay
dividends on the Common Stock (except dividends payable in shares of Common
Stock) without declaring dividends on the Class A Common Stock. If any
dividend is declared and paid on the Class A Common Stock in shares of Common
Stock or Class A Common Stock, a like dividend must be paid on the Common Stock
in shares of Common Stock. The Company may not declare any dividend on shares
of Common Stock payable in shares of Class A Common Stock. Shares of Common
Stock are not convertible into any other class of equity securities of the
Company.
If, as of the record date of any stockholders' meeting at which
directors are to be elected, the number of issued and outstanding shares of
Common Stock constitutes less than 10% of the aggregate number of issued and
outstanding shares of both Common Stock and Class A Common Stock, then all
directors to be elected at such meeting will be elected by the holders of
Common Stock and Class A Common Stock voting together as a single class;
provided, however, that the holders of Common Stock will have one vote per
share and the holders of Class A Common Stock will have ten votes per share
with respect to such election.
CLASS A COMMON STOCK
In all elections of directors, the holders of Class A Common Stock are
entitled, voting separately as a class, to elect the number of directors of the
Company which are not entitled to be elected by the holders of Common Stock
(approximately 75%). In all other matters, unless otherwise provided in the
Articles of Incorporation or as provided by law, each share of Class A Common
Stock has ten votes and votes with all other classes of the common stock of the
Company as a single class.
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<PAGE> 31
The Class A Common Stock is convertible on a share-for-share basis
into Common Stock at any time at the election of the holder.
The Company may not declare any dividend on the Class A Common Stock
(except dividends payable in equity securities of the Company), unless
concurrently there is declared and paid on the Common Stock a dividend of not
less than 105% of the amount of the dividend declared and paid on the Class A
Common Stock. However, if the Company declares and pays a dividend on the
Common Stock in shares of Common Stock, it must concurrently declare and pay a
like dividend on the Class A Common Stock in shares of Common Stock or Class A
Common Stock. The Company may not declare or pay any dividend in shares of
Class A Common Stock on any equity securities of the Company other than Class A
Common Stock.
If, as of the record date for any stockholders' meeting at which
directors are to be elected, the number of issued and outstanding shares of
Class A Common Stock falls below 750,000, then those directors who would
otherwise be elected by the holders of Class A Common Stock at such meeting as
provided in the Articles of Incorporation will be elected by the holders of
Class A Common Stock and Common Stock voting together as a single class;
provided, however, that the holders of Class A Common Stock will have ten votes
per share and the holders of Common Stock will have one vote per share with
respect to such election.
GENERAL
Except as described above, the Common Stock and Class A Common Stock
rank pari passu and possess equal rights and privileges on a share-for-share
basis, including any rights to liquidating or other distributions.
Stockholders do not have cumulative voting rights, nor do they have preemptive
or other rights to subscribe for additional shares of any voting securities of
the Company. Upon liquidation, dissolution or winding-up of the Company
subject to the preferential rights of any outstanding shares of Preferred
Stock, the assets legally available for distribution to stockholders will be
distributable ratably among the holders of the shares of all classes of common
stock at that time outstanding. No classes of common stock will have any
liability for further calls or assessments respecting such shares.
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<PAGE> 32
INDEPENDENT AUDITORS
Ernst & Young were the independent auditors for the Company during the
year ended December 31, 1994. The Company has been advised that no
representative of Ernst & Young will be present at the Annual Meeting.
Although the Board of Directors has not yet selected independent auditors for
the Company for the fiscal year ended December 31, 1995, it is expected that
Ernst & Young will be chosen.
INCORPORATION BY REFERENCE
The consolidated financial statements of the Company at December 31,
1994 and 1993, and for each of the three years in the period ended December 31,
1994, as well as the supplementary financial information and related
Management's Discussion and Analysis of Financial Condition and Results of
Operations, are incorporated herein by reference from the Company's 1994 Annual
Report to Stockholders, which accompanies this Proxy Statement.
PROPOSALS OF STOCKHOLDERS
Proposals of stockholders intended to be presented at the 1996 Annual
Meeting of Stockholders of the Company must be received by the Secretary of the
Company, P. O. Box 54678, Civic Center Station, Atlanta, Georgia 30379, no
later than November 23, 1995.
OTHER MATTERS
At the date hereof, there are no other matters management intends to
present or has reason to believe others will present to the meeting. If other
matters now unknown to management come before this meeting, those who shall act
as proxies will vote in accordance with their judgment.
By Order of the Board of Directors
Christine M. Jones
Vice President and Secretary
March 22, 1995
Atlanta, Georgia
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<PAGE> 33
<TABLE>
<CAPTION>
APPENDIX A
PROXY - SOLICITED BY BOARD OF DIRECTORS HAVERTY FURNITURE COMPANIES,INC. 1995 ANNUAL MEETING OF STOCKHOLDERS
The undersigned stockholder(s) in HAVERTY FURNITURE COMPANIES, INC., hereby appoints and constitutes DENNIS L. FINK, CHRISTINE M.
JONES, WILLIAM J. REIF and A. DANA ATWELL, or any one of them, but if more than one present, a majority of them present, to act as
lawful attorney and proxy of the undersigned, with the power of substitution for and in the name, place and stead of the
undersigned, to vote at the annual meeting of stockholders of the Company to be held on April 28, 1995, at the Harbor Court Hotel,
550 Light Street, Baltimore, Maryland 21202, at 11:00 A.M., or any adjournment thereof, for the following purposes and upon any
other matters that may come before the meeting or any adjournment thereof, with all the powers the undersigned would possess if
personally present, hereby revoking all previous proxies:
<S> <C>
PROPOSAL 1 1. To elect nine directors of the Company for terms of one year, and until their successors are
TO BE VOTED elected and qualified:
ON ONLY BY / / FOR all nominees listed (except as marked to the contrary) / / WITHHOLD AUTHORITY to vote for all
HOLDERS OF nominees listed
CLASS A Rawson Haverty John E. Slater, Jr. John Rhodes Haverty, M.D. Clarence H. Smith Fred J. Bates
COMMON STOCK Lynn H. Johnston Clarence H. Ridley Rawson Haverty, Jr. Frank S. McGaughey, III
(INSTRUCTION: To withhold authority to vote for any individual nominee, write that nominee's name on the
space provided below.)
-------------------------------------------------------------------------------------------------------------------
PROPOSAL 2 2. To elect four directors of the Company for terms of one year, and until their successors are elected and
TO BE VOTED qualified:
ON ONLY BY / / FOR all nominees listed (except as marked to the contrary) / / WITHHOLD AUTHORITY to vote for all
HOLDERS OF nominees listed
COMMON STOCK Dr. Kenneth Black, Jr. William A. Parker, Jr. Robert R. Woodson L. Phillip Humann
(INSTRUCTION: To withhold authority to vote for any individual nominee, write that nominee's name on the space
provided below.)
-------------------------------------------------------------------------------------------------------------------
PROPOSAL 3 3. To approve an amendment to the Company's Articles of Incorporation to increase the number of authorized shares of
TO BE Common Stock and Class A Common Stock as set forth in Agenda Item Two of the Proxy Statement.
VOTED ON / / FOR / / AGAINST / / ABSTAIN
BY ALL
STOCKHOLDERS 4. In their discretion, the Proxies are authorized to vote upon such other business as may properly be brought before
the meeting or any adjournment thereof. (Continued and to be signed and dated on the reverse side)
PROXY - SOLICITED BY BOARD OF DIRECTORS (Continued from other side) 1995 ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER(S). THE
BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE ABOVE PROPOSALS. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR"
PROPOSALS 1, 2 AND 3.
Please date and sign exactly as name(s)
appears on reverse side. When signing as an
attorney, administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full corporate
name by President or other authorized
officer. If a partnership, please sign in
partnership name by authorized person. For
joint accounts, each joint owner should sign.
___________________________________________
Signature
___________________________________________
Signature
Date_______________________________________
</TABLE>
