<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant /X/
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/X/ Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
DECORATOR INDUSTRIES, INC.
--------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
-----------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(l), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11
/ / 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.
<PAGE>
[SEAL]
DECORATOR INDUSTRIES, INC.
10011 Pines Boulevard
Pembroke Pines, FL 33024
NOTICE OF ANNUAL MEETING OF
STOCKHOLDERS TO BE HELD MAY 16, 1997
TO THE STOCKHOLDERS OF DECORATOR INDUSTRIES, INC.
Notice is hereby given that the annual meeting of the stockholders of
Decorator Industries, Inc. will be held on the 40th Floor, One Oxford Centre,
Pittsburgh, Pennsylvania, on May 16, 1997 at 9:30 A.M., local time, for the
purpose of:
(a) Electing two directors.
(b) Transacting such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors fixed the close of business on March 24, 1997 as the
record date for the determination of stockholders entitled to notice of and to
vote at the annual meeting.
A copy of the Company's annual report to stockholders for the fiscal year
ended December 28, 1996 is furnished herewith.
PLEASE SIGN AND RETURN PROMPTLY THE ENCLOSED PROXY IN THE ENVELOPE
PROVIDED. NO POSTAGE IS REQUIRED FOR MAILING IN THE UNITED STATES. YOUR PROMPT
COMPLIANCE WITH THIS REQUEST WILL BE APPRECIATED AND WILL ASSIST IN OBTAINING A
QUORUM. YOUR PROXY MAY BE WITHDRAWN AT ANY TIME PRIOR TO ITS EXERCISE BY GIVING
NOTICE TO THE UNDERSIGNED.
By Order of the Board of Directors
JEROME B. LIEBER
Secretary
April 16, 1997
<PAGE>
PROXY STATEMENT
DECORATOR INDUSTRIES, INC.
10011 Pines Boulevard
Pembroke Pines, FL 33024
April 16, 1997
This statement is furnished in connection with the solicitation of proxies
to be used at the annual meeting of stockholders of Decorator Industries, Inc.
(the "Company"), to be held May 16, 1997 at the place and time and for the
purposes set forth in the foregoing Notice of Annual Meeting, and at any
adjournment thereof. This proxy statement and the enclosed form of proxy and
annual report for 1996 were mailed to stockholders on or about April 16, 1997.
Proxies in the form enclosed are solicited on behalf of the Board of
Directors of the Company. The cost of preparing, assembling and mailing the
notice of annual meeting, proxy statement and form of proxy is to be borne by
the Company. In addition to the solicitation of proxies by use of the mails,
directors, officers or other employees of the Company may solicit proxies
personally or by telephone or telegraph and the Company may request certain
persons holding stock in their names or in the names of their nominees to obtain
proxies from and send proxy material to the principals and will reimburse such
persons for their expenses in so doing.
The accompanying proxy may be revoked by the stockholder at any time prior
to its use by giving notice of such revocation either personally or in writing
to Jerome B. Lieber, Secretary of the Company, 40th Floor, One Oxford Centre,
Pittsburgh, PA 15219. Unless the proxy shall have been properly revoked, the
shares represented by proxies in the enclosed form will be voted. Each such
proxy will be voted as directed, but if no direction is indicated, it will be
voted FOR the election of the Board of Directors' nominees named below, either
by the same number of votes being cast for each nominee or cumulatively, in the
discretion of the named proxies.
Only holders of record of the Company's Common Stock, par value $.20 per
share ("Common Stock"), at the close of business on March 24, 1997 will be
entitled to vote at the meeting. As of March 24, 1997, there were 2,347,831
shares of Common Stock outstanding, the holders of which are entitled to one
vote per share, except for cumulative voting in the election of directors, as
explained below. As of that date, approximately 29,830 shares of Common Stock
were issuable upon surrender of the old $.10 par value shares which had not as
yet been exchanged for Common Stock pursuant to the one-for-two reverse stock
split of July 30, 1982. The $.10 par value shares may not be voted. The $.20 par
value stock to which the holders of the old $.10 par value stock are entitled,
together with the accrued cash dividends thereon, are in the process of being
escheated to the proper states as unclaimed property.
A quorum for the transaction of business at the annual meeting will require
the presence, in person or by proxy, of stockholders entitled to cast at least a
majority of the total number of votes entitled to be cast on a particular matter
to be acted upon at the meeting. Directors will be elected at the meeting by a
plurality of the votes cast. Abstentions and broker non-votes are counted as
shares present for determination of a quorum but are not counted as affirmative
or negative votes and are not counted in determining the number of votes cast on
any matter.
Stockholders are entitled to cumulative voting in the election of
directors, which means that a stockholder is entitled to a number of votes equal
to the number of shares held by such stockholder multiplied by the number of
directors to be elected, and such stockholder may cast all of such votes for one
nominee or distribute them between the two nominees.
ELECTION OF DIRECTORS
The Board of Directors consists of three classes of directors with
staggered terms. A purpose of the meeting is the election of two directors to
serve for a term of three years. The last two columns of the tables below give
information regarding the Common Stock beneficially owned by the nominee or
director as of the close of business on March 24, 1997. The percentages in the
last column were computed by dividing the number of shares beneficially owned by
the total of (i) the estimated number of shares of Common Stock which would have
been outstanding had all $.10 par value shares been exchanged for Common Stock
and (ii) the number of shares of Common Stock, if any, which the named nominee
or director was entitled to acquire within 60 days of March 24, 1997 through the
1
<PAGE>
exercise of stock options.
Nominees for Election as Directors
Information regarding the nominees for election as directors is set forth
below:
Common
Shares Percent
Director Beneficially of
Name Age Principal Occupation Since Owned Class
---- --- -------------------- ----- ----- -----
Joseph N. Ellis 68 Management Consultant 1993 1,600 ----
Ellen Downey 44 Director, FRD ---- 1,000 ----
Acquisition Co.;
Private Investor
Mr. Ellis founded La Salle-Deitch Co. Inc., a distributor of products for
the manufactured housing and recreational vehicle industries, in 1963 and served
as its President, Chief Executive Officer and Chairman from 1971 until his
retirement in 1992.
Ms. Downey is a director of FRD Acquisition Co. (Coco's and Carrows
restaurants), a wholly-owned subsidiary of Flagstar Corporation. She is also a
private investor. Ms. Downey was employed by Ryder System, Inc. in various
financial positions from 1978 to 1991 and from 1991 to 1993 served as Vice
President and Treasurer of that company.
The nomination of the above persons for the office of director originated
with the present Board of Directors. Such persons have advised the Company that
they are willing to serve as directors for the term for which they are standing
for election. If at the time of the meeting either of the nominees should be
unable or unwilling to serve as a director for any reason, it is intended that
the enclosed proxy will be voted for the election of such person, if any, as is
designated by the Board of Directors to replace such nominee, unless the proxy
withholds authority to vote for nominees.
The Board of Directors recommends a vote FOR the foregoing nominees.
Directors Whose Terms Continue After the Meeting
Information regarding the directors whose terms of office continue after
the annual meeting is set forth below:
<TABLE>
<CAPTION>
Common
Present Shares Percent
Director Term Beneficially of
Name Age Principal Occupation Since Expires Owned Class
---- --- -------------------- ----- ------- ----- -----
<S> <C> <C> <C> <C> <C> <C>
William A. Bassett 60 Chairman of the Board, 1980 1998 241,547(1) 9.71
President and Chief Executive
Officer of the Company
Michael K. Solomon 47 Vice President, Treasurer 1987 1999 62,663(2) 2.60
and Chief Financial Officer
of the Company
Jerome B. Lieber 76 Senior Counsel - 1961 1999 8,772(3) ----
Klett Lieber Rooney & Schorling,
a Professional Corporation,
Attorneys at Law
William H. Allen, Jr. 61 Vice Chairman of the Board, 1995 1998 2,500 ----
NationsBank N.A. (South)
</TABLE>
(1) Includes 113,331 optioned shares which may be acquired within 60 days
after March 24, 1997.
(2) Includes 31,997 optioned shares which may be acquired within 60 days
after March 24, 1997.
(3) Includes 3,226 shares held in a charitable trust as to which Mr. Lieber
disclaims beneficial ownership.
Mr. Bassett has been President of the Company since 1980, Chief Executive
Officer since February 1993 and Chairman of the Board since January 1994.
Mr. Solomon has been Vice President of the Company since November 1994 and
Treasurer and Chief Financial Officer of the Company since 1985.
2
<PAGE>
Mr. Lieber has been Secretary of the Company since 1961. He is a Senior
Counsel to the law firm of Klett Lieber Rooney & Schorling, a Professional
Corporation, Pittsburgh, Pennsylvania, which serves as general counsel to the
Company. Mr. Lieber previously had been a senior partner in that firm.
Mr. Allen was appointed to the Board of Directors on February 28, 1995. He
has been Vice Chairman of the Board of NationsBank N.A. (South) since December
1995 and previously served as Chairman of the Board and Chief Executive Officer
of Intercontinental Bank. Mr. Allen is also a director of American Bankers Life
Insurance Company and Winsloew Furniture, Inc.
At March 24, 1997, the officers and directors of the Company as a group had
sole or shared voting or investment power as to 174,754 shares of the Company's
Common Stock, which together with 145,328 optioned shares that could be acquired
within 60 days after March 24, 1997, would constitute 12.69% of the total shares
then outstanding, assuming that all of the old $.10 par value shares had been
exchanged for Common Stock and that the optioned shares were outstanding.
DIRECTOR COMPENSATION
Directors who are not employees of the Company are paid a fee of $10,000
per year for their services as directors. Directors who are also employees of
the Company are not separately compensated for the services as directors.
PRINCIPAL STOCKHOLDERS
See "Election of Directors" above for the stockholding of William A.
Bassett, Chairman of the Board, President and Chief Executive Officer of the
Company.
Coury Investments, Ltd., a real estate and securities investment limited
partnership organized in Florida, informed the Company in mid-1993 that it then
beneficially owned 180,000 shares of the Company's Common Stock. The Company has
no further information regarding Coury's ownership of Common Stock.
FMR Corp. of Boston, Massachusetts, has furnished the Company a copy of its
Schedule 13G in which it reported that as of December 31, 1996 Fidelity
Management & Research Company, a wholly-owned subsidiary of FMR Corp. and a
registered investment adviser, had sole investment power with respect to 241,866
shares (10.18%) of the Company's Common Stock.
ZPR Investment Management Inc. of Orange City, Florida, a registered
investment adviser, has furnished the Company a copy of its Schedule 13G dated
January 10, 1997 in which it reported that it had sole voting power with respect
to 172,697 shares (7.27%) of the Company's Common Stock.
Laifer Capital Management, Inc. of New York, New York furnished the Company
a copy of its Schedule 13G dated February 7, 1996 in which it reported
beneficial ownership of a total of 98,400 shares of the Company's Common Stock,
including sole power to vote 72,400 shares, sole power to dispose of 65,000
shares and shared power to dispose of 33,400 shares. No further information has
been received from that company.
EXECUTIVE COMPENSATION
Employment Agreement
The Company has an employment agreement with William A. Bassett which will
expire July 1, 2004 and provides for an annual salary of not less than $214,200.
Annual Compensation and Stock Options
The following table shows the compensation of the named executive officers
of the Company for the fiscal years ended December 28, 1996 ("fiscal 1996"),
December 30, 1995 ("fiscal 1995"), and December 31, 1994 ("fiscal 1994").
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long-Term
Compensation
Annual Compensation Awards
- - ------------------ ------------------------------------- ------------
Name and Fiscal Optioned All Other
Principal Position Year Salary($) Bonus ($) Other($)(1) Shares(#) Compensation($)(2)
- - ------------------ ---- --------- --------- ----------- --------- ------------------
<S> <C> <C> <C> <C> <C> <C>
William A. Bassett 1996 236,156 156,000 * 33,333 34,745
Chairman of the Board, 1995 224,910 58,234 * ---- 34,745
President and Chief 1994 209,100 78,689 49,637 13,333 21,577
Executive Officer
3
<PAGE>
Michael K. Solomon 1996 107,000 28,940 27,106 13,333 ----
Vice President, Treasurer 1995 104,500 14,558 * ---- ----
and Chief Financial Officer 1994 99,500 19,672 14,483 5,999 ----
</TABLE>
(1) Medical/dental reimbursement plan payments, country club memberships,
personal use of Company vehicles, and payments made in accordance with
Company policy for disqualifying sales of Common Stock acquired upon the
exercise of a qualified stock option. For 1996, payment to Mr. Solomon
for such sales was $18,059 and provided a net benefit to the Company of
$11,919. For 1994, payments to Messrs. Bassett and Solomon for such sales
were $47,884 and $8,833, respectively. All such sales during 1994
provided a net benefit to the Company of $94,970. An asterisk indicates
that the total of other annual compensation for that year was less than
10% of salary and bonus for that year.
(2) Premiums paid by the Company on life and long-term disability insurance
policies.
The following table provides information on options granted to the named
executive officers in fiscal 1996 under the Company's 1995 Incentive Stock
Option Plan:
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Individual Grants
----------------------------------------------------------
Percent of Potential Realizable Value at
Total Options Assumed Annual Rates of
Options Granted to Exercise Stock Price Appreciation for
Granted Employees Price Expiration Option Term (2)
Name (Shs)(1) in 1996 Per Share (1) Date 5% 10%
<S> <C> <C> <C> <C> <C> <C>
William A. Bassett 33,333 20.0% $7.50 5/3/06 $157,277 $398,432
Michael K. Solomon 13,333 8.0% 7.50 5/3/06 62,888 159,370
</TABLE>
(1) As adjusted for the four-for-three stock split in June 1996. Options
heretofore granted under the 1995 Incentive Stock Option Plan have a ten
year term and vest 20% on the date of grant and 20% annually thereafter
through the fourth anniversary of the grant.
(2) Potential realizable value is based on the assumption that the market
price of the Common Stock appreciates at the annual rates shown (compounded
annually) from the date of grant until the end of the ten year option term.
Potential realizable value is shown net of exercise price. These numbers
are calculated based on regulations promulgated by the Securities and
Exchange Commission and do not reflect the Company's estimate of future
stock price growth.
The following table sets forth information concerning the exercise of stock
options during 1996 by the named executive officers and the value of their
unexercised, in-the-money stock options at the end of that fiscal year (December
28, 1996). All options outstanding at December 28, 1996, except for those
granted after 1995, were exercisable at any time prior to their respective
expiration dates.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
Value of
Shares Acquired Value Optioned Shares Options at
Name on Exercise Realized($) at 12/28/96(#) 12/28/96($)(1)
- - ---- ----------- ----------- --------------- --------------
<S> <C> <C> <C> <C>
William A. Bassett 26,666(2) 146,378 133,331 1,083,294
Michael K. Solomon 13,332(2) 83,388 45,998 357,978
</TABLE>
(1) Assumes a market value of $11.50 per share, which was the last reported
sale price on the American Stock Exchange on December 27, 1996.
(2) As adjusted for the four-for-three stock split in June 1996.
The Company's medical and dental reimbursement plan provides reimbursement
to the corporate and certain divisional officers of the Company and their
dependents (as defined in Section 152 of the Internal Revenue Code) for their
medical and dental expenses. Benefits under the plan are limited to 10% of the
participant's compensation during the plan year. The plan also prohibits any
participant from receiving "double reimbursement", i.e. if a participant
receives reimbursement from another source, he or she must remit to the Company
benefits received under the plan.
The Company's 1984 Incentive Stock Option Plan, which expired February 22,
1994, authorized the granting to key employees of options to purchase up to
604,666 shares of the Company's Common Stock. The purchase price
4
<PAGE>
of optioned shares is the fair market value of the Common Stock on the date of
grant, and the maximum term of the options is ten years; in the case of options
granted to employees who owned more than 10% of the outstanding Common Stock,
however, the purchase price was 110% of the fair market value of the Common
Stock on the date of grant and the term of the option was five years. The number
of optioned shares and the price per share are subject to adjustment for stock
splits, stock dividends, reclassifications and the like.
On April 3, 1995 the Board of Directors adopted, and on June 5, 1995 the
stockholders approved, the Company's 1995 Incentive Stock Option Plan (the "1995
Plan") which has a term of ten years. The 1995 Plan authorizes the issuance of
up to 333,332 shares of Common Stock pursuant to stock options granted to key
employees of the Company. The purchase price of optioned shares must be the fair
market value of the Common Stock on the date of the grant, and the maximum term
of the options is ten years; in the case of options granted to employees who own
more than 10% of the outstanding Common Stock, however, the purchase price must
be 110% of the fair market value of the Common Stock on the date of grant and
the term of the option cannot exceed five years. The number of shares that may
be issued under the 1995 Plan, the number of optioned shares and the purchase
price per share are subject to adjustment for stock splits, stock dividends,
reclassifications and the like.
Board of Directors' Report On Executive Compensation
The Board of Directors sets and approves the salaries of the executive
officers of the Company on an annual basis. In determining the salaries, the
Board considers the size of the Company, its performance during the previous
fiscal year, the responsibilities and performance of the executive officer, and
such other factors as the directors may wish to consider. No pre-determined
formula or guidelines are used, and no specific weight is given to any one
factor.
The Board has also granted stock options to executive officers and other
key employees as a means of further motivating them to exert their best efforts
on behalf of the Company.
The salary of Mr. Bassett, Chief Executive Officer of the Company, for
fiscal 1996 was determined by the Board of Directors upon consideration of his
and the Company's performance during the previous fiscal year, the
responsibilities of that office, and Mr. Bassett's contributions to the growth
and development of the Company. No specific weight was given to any one of the
factors considered.
William A. Bassett William H. Allen, Jr. Joseph N. Ellis
Michael K. Solomon Jerome B. Lieber Herbert Walker
PERFORMANCE GRAPH
Set forth below are a graph and table which compare the value for the five
calendar years ended December 31, 1996 of $100 invested at the close of
trading on December 31, 1991, in each of three investment alternatives:(a)
the Company's Common Stock, (b) the "Russell 2000" Index, and (c) the "S & P
500" Index. The graph has been prepared assuming the reinvestment of all cash
dividends paid during the period. The Company is not able to identify a peer
group for comparison purposes.
12/91 12/92 12/93 12/94 12/95 12/96
Decorator 100 661 768 671 763 1491
S&P 500 100 108 118 120 165 202
Russell 2000 100 119 141 139 178 207
5
<PAGE>
DISCRETIONARY AUTHORITY
At the time of mailing copies of this proxy statement to stockholders, the
election of directors is the only matter known by Management that will be
presented for action at the annual meeting of stockholders. Should any other
matters come before the meeting, action may be taken thereon pursuant to proxies
in the form enclosed, which confer discretionary authority upon the persons
named therein or their substitutes with respect to any such business which may
properly come before the meeting.
CONCERNING THE AUDITORS
Louis Plung &Company are the independent public accountants of the Company.
Representatives of such firm are expected to be in attendance at the annual
meeting and will have the opportunity to make a statement if they desire to do
so, and they are expected to be available to respond to appropriate questions.
OTHER INFORMATION
The Board of Directors has no nominating, compensation or similar committee
other than the Stock Option Committee. The Board's Audit Committee is composed
of Herbert Walker and Joseph N. Ellis. The Audit Committee reviews the overall
plan of the annual independent audit, the financial statements, the scope of
audit procedures, the performance of the Company's independent accountants and
internal auditors, and the auditors' evaluation of internal controls.
Herbert Walker, who at age 83 is not standing for reelection, has been a
director of the Company since 1980. The Board of Directors is very grateful to
Mr. Walker for his many years of dedicated service and wise counsel.
During fiscal 1996, the Board of Directors held six meetings, the Audit
Committee held two meetings, and the Stock Option Committee held one meeting.
Shareholder proposals intended to be presented at the 1998 annual meeting
must be received by the Company prior to December 20, 1997 to be considered for
inclusion in the Company's proxy statement and form of proxy for that meeting.
By Order of the Board of Directors
JEROME B. LIEBER
Secretary
6
<PAGE>
DECORATOR INDUSTRIES, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD MAY 16, 1997
The undersigned hereby appoints William A. Bassett, Michael K. Solomon
and Jerome B. Lieber, and each of them (with full power to act without the
others and with full power of substitution), the attorney and proxy of the
undersigned to attend the Annual Meeting of the Stockholders of Decorator
Industries, Inc., to be held on the 40th Floor, One Oxford Centre,
Pittsburgh, Pennsylvania 15219, at 9:30 A.M., E.D.S.T., on May 16, 1997, and
any adjournment thereof, and to vote the number of shares of Common Stock of
the Company which the undersigned is entitled to vote with all the power the
undersigned would possess if personally present.
THE PROXIES ARE DIRECTED TO VOTE AS SET FORTH HEREIN. IF NO DIRECTION IS
INDICATED, THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED FOR THE ELECTION
OF THE NOMINEES NAMED HEREIN, EITHER BY THE SAME NUMBER OF VOTES BEING CAST FOR
EACH NOMINEE OR CUMULATIVELY, IN THE DISCRETION OF THE NAMED PROXIES. If either
of the named nominees is unavailable for election, such shares may be voted for
such substitute nominee as may be designated by the Board of Directors.
THE SOLICITATION OF THIS PROXY IS MADE ON BEHALF OF THE BOARD OF DIRECTORS.
Please Sign and Date This Proxy on the Reverse Side and Return it in the
Enclosed Envelope.
(continued on reverse side)
- FOLD AND DETACH HERE -
<PAGE>
Please mark
your votes as X
indicated in
this example
1. ELECTION OF DIRECTORS
<TABLE>
<CAPTION>
<S> <C>
FOR WITHHOLD THE BOARD RECOMMENDS A VOTE FOR THE NOMINEES LISTED BELOW.
all nominees AUTHORITY
named herein to vote for NOMINEES: Joseph N. Ellis and Ellen Downey
all nominees
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR EITHER INDIVIDUAL NOMINEE, STRIKE THROUGH
THAT NOMINEE'S NAME ABOVE.
2. In their discretion, upon such other matters as
may properly come before the meeting.
The undersigned hereby acknowledges receipt of the Annual
Report for the fiscal year ended December 28, 1996 and the
notice of Annual Meeting and Proxy Statement for the 1997
Annual Meeting of Stockholders.
Please sign exactly as name appears hereon. If signing in a
fiduciary or representative capacity, please give full title
as such. If shares are registered in more than one name, all
holders must sign. If signature is for a corporation please
sign full corporate name by authorized officer.
Dated: ________________________________________________, 1997
_____________________________________________________________
_____________________________________________________________
Signature(s) of Stockholder(s)
</TABLE>
- FOLD AND DETACH HERE -
[LOGO]
DECORATOR INDUSTRIES, INC.
ANNUAL MEETING OF STOCKHOLDERS
MAY 16, 1997
YOUR VOTE IS IMPORTANT TO US. PLEASE COMPLETE,
DATE AND SIGN THE ABOVE PROXY CARD AND RETURN
IT PROMPTLY IN THE ACCOMPANYING ENVELOPE.
