<PAGE> 1
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SCHEDULE 14A
(RULE 14a)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
THE DAVEY TREE EXPERT COMPANY
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
XXXXXXXXXXXX
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(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............................................................
[ ] 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:...............................................................
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[DAVEY LOGO]
THE DAVEY TREE
EXPERT COMPANY
NOTICE OF 1999
ANNUAL MEETING
AND PROXY STATEMENT
<PAGE> 3
[DAVEY LOGO]
R. Douglas Cowan
Chairman of the Board and
Chief Executive Officer
April 16, 1999
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders to be
held at the Sheraton Suites, Cuyahoga Falls, Ohio at 5:00 p.m. on Tuesday, May
18, 1999. We hope that you will be able to attend.
The Notice of Annual Meeting of Shareholders and the Proxy Statement, which are
included in this booklet, describe the matters to be acted upon at the meeting.
Regardless of the number of shares you own, your vote on these matters is
important. Whether or not you plan to attend the meeting, we urge you to mark
your choices on the enclosed proxy card and sign and return it in the envelope
provided. If you later decide to vote in person at the meeting, you will have an
opportunity to revoke your proxy and vote by ballot.
We look forward to seeing you at the meeting.
Sincerely,
R. DOUGLAS COWAN
Chairman of the Board and
Chief Executive Officer
<PAGE> 4
THE DAVEY TREE EXPERT COMPANY
NOTICE OF ANNUAL MEETING
OF SHAREHOLDERS
The Annual Meeting of Shareholders of The Davey Tree Expert Company will be held
at the Sheraton Suites, Cuyahoga Falls, Ohio, at 5:00 p.m. on Tuesday, May 18,
1999. The purposes of the meeting are:
1. To elect directors to the class whose term expires in 2002.
2. To hear reports and to transact any other business that may properly come
before the meeting.
Shareholders of record at the close of business on April 3, 1999, are entitled
to notice of and to vote at the meeting.
For the Board of Directors
DAVID E. ADANTE
Secretary
April 16, 1999
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THE DAVEY TREE EXPERT COMPANY
PROXY STATEMENT
The Board of Directors of The Davey Tree Expert Company requests your proxy for
use at the Annual Meeting of Shareholders to be held on May 18, 1999, and at any
adjournments of that meeting. This Proxy Statement is to inform you about the
matters to be acted upon at the meeting.
If you attend the meeting, you can vote your shares by ballot. If you do not
attend, your shares can still be voted at the meeting if you sign and return the
enclosed proxy card. Shares represented by a properly signed card will be voted
in accordance with the choices marked on the card. If no choices are marked, the
shares will be voted to set the number of directors at ten and to elect as
directors the nominees listed on page 3. You may revoke your proxy before it is
voted by submitting another proxy card with a later date or by giving notice to
the Company in writing or orally at the meeting.
This Proxy Statement and the enclosed proxy card are being mailed to
shareholders on or about April 16, 1999. The Company's executive offices are
located at 1500 North Mantua Street, Kent, Ohio 44240. Its telephone number is
(330) 673-9511.
ELECTION OF DIRECTORS
The Company's Board of Directors is now composed of ten directors, three
directors in the class whose terms expire in 1999, four directors in the class
whose terms expire in 2000 and three directors in the class whose terms expire
in 2001. Each of the directors serves for a term of three years and until a
successor is elected. The Board met five times during the last fiscal year.
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After many years of distinguished service, John W. Joy is retiring from the
Board of Directors effective at the end of his current term. No nominee has
been identified to fill the position vacated by Mr. Joy.
Nominees for election as directors for the term expiring in 2002, as well as
present directors, whose term will continue after the meeting, appear below. The
Board of Directors recommends you vote for the nominees listed.
NOMINEES FOR DIRECTORS WHOSE TERMS EXPIRE IN 2002
R. DOUGLAS COWAN, age 58, has been a director of the Company since 1982,
Chairman of the Board since 1997, and Chief Executive Officer since 1988, and
was President for more than five years until 1999 when his successor was
elected.
RUSSELL R. GIFFORD, age 59, was elected by the Board of Directors in December,
1997 to fill the position vacated by J Maurice Struchen who retired from the
Board of Directors at the end of his term in 1996.
Mr. Gifford was President of Consolidated Natural Gas System, an unregulated
marketing arm of CNG Energy Services Corporation, from 1994 until his retirement
in 1997, and also served as President and CEO of East Ohio Gas Company from 1989
to 1994. Mr. Gifford is a director of First Union Real Estate Investments, a
real estate investment concern concentrating in commercial real estate, and
Applied Industrial Technologies, Inc., a parts and service distribution company.
PRESENT DIRECTORS WHOSE TERMS EXPIRE IN 2000
RICHARD E. DUNN, age 71, has been a director of the Company since 1980. He was
Vice President for Business Affairs and Treasurer of Kent State University in
Kent, Ohio, for more than five years, prior to his retirement in 1991.
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WILLIAM D. GINN, age 75, has been a director of the Company since 1973. He has
been of counsel to Thompson Hine & Flory LLP, a law firm, since 1993. Prior to
that time he was a partner at Thompson Hine & Flory LLP, for more than five
years. Mr. Ginn is also a director of Nordson Corporation, a manufacturer of
industrial application equipment. Thompson Hine & Flory LLP has in the past
provided and continues to provide legal services to the Company.
RICHARD S. GRAY, age 67, has been a director of the Company since 1991. He had
been president of Enterprise Development, Incorporated, a non-profit
organization that provides counsel and assistance to new enterprises, since
April 1987 and until his retirement in 1998. He is a director of SIFCO
Industries, Inc., a provider of specialty components for aerospace applications.
He is also a director of Shiloh Industries, Inc., a steel processor and supplier
of blanks and stampings to industrial manufacturers.
THOMAS G. MURDOUGH, JR., age 60, has been a director of the Company since 1994.
Prior to this and for more than five years he was the founder and President of
Step 2 Corporation, and its Chief Executive Officer since 1997. Mr. Murdough was
also the founder of Little Tikes Company, which he sold to Rubbermaid in 1984.
He continued as its President and General Manager until September 1989.
PRESENT DIRECTORS WHOSE TERMS EXPIRE IN 2001
R. CARY BLAIR, age 59, has been a director of the Company since 1989. He has
been President and Chief Executive Officer of the Westfield Companies, a
regional property, casualty, and life insurance company headquartered in
Westfield, Ohio, since 1991. He has been a director of the Westfield Companies
since 1984 and is a director of Inter-Ocean Reinsurance Co., Ltd., a multi-line
finite re-insurance concern. He is also a director of First Merit Corporation
and First Merit-Old
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Phoenix National Bank, both of which are financial institutions headquartered in
Akron, Ohio.
DOUGLAS K. HALL, age 47, has been a director of the Company since 1998. He was
named CEO and Vice Chairman of Earth Satellite Corporation, a provider of remote
sensing utilizing geographic information systems (GIS) in 1999. Prior to
joining Earth Satellite, and since 1996, he was Vice President and Chief
Operations Officer of The Nature Conservancy, an international conservation
organization with 900,000 members. From 1993 to 1996, he served as Assistant
Secretary for Oceans and Atmosphere and Deputy Administrator of the National
Oceanic and Atmospheric Administration (NOAA) in the U.S. Department of
Commerce.
JAMES H. MILLER, age 72, has been a director of the Company since 1985. Mr.
Miller has been retired since 1986. Before his retirement, he was Vice
President-Administration of GenCorp, Inc. (formerly the General Tire and Rubber
Co.), a tire manufacturer.
COMMITTEES OF THE BOARD OF DIRECTORS;
ATTENDANCE
The present members of the Audit Committee are Messrs. Dunn, Gifford, Hall, and
Gray (Chairman). The Audit Committee reviews the proposed audit programs
(including both independent and internal audits) for each fiscal year, the
results of these audits, and the adequacy of the Company's systems of internal
control. The Committee also recommends to the Board of Directors the appointment
of the independent auditors for each fiscal year. The Audit committee met two
times during the last fiscal year.
The present members of the Compensation committee are Messrs. Blair (Chairman),
Gifford, Gray, and Miller. The Compensation Committee recommends to the Board of
Directors the salaries and other compensation of executive officers of the
Company and supervises
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the administration of the Company's benefits programs. The Compensation
Committee met two times during the last fiscal year.
The present members of the Nominating Committee are Messrs. Blair, Cowan, Dunn,
Ginn (Chairman), Hall and Murdough. The Nominating Committee screens and
nominates candidates for election as directors and recommends committee members
for appointment by the Board of Directors. The Nominating Committee will
consider nominees for the Board of Directors recommended by shareholders. A
shareholder who wishes to suggest a director candidate for consideration by the
Nominating Committee should consult the applicable provision of the Company's
Regulations, which are available for inspection at the Company's offices during
business hours. The Nominating Committee met one time during the last fiscal
year.
The present members of the Finance Committee are Messrs. Cowan, Ginn, Joy,
Miller (Chairman), and Murdough. The Finance Committee reviews the Company's
annual business plan as developed by management and recommends it to the Board
of Directors for approval. The Committee also reviews longer-term financial
issues affecting the Company's ownership structure, financial condition and
business plans. The Finance Committee met three times during the last fiscal
year.
During the last fiscal year, each director attended at least 75% of the meetings
of the Board of Directors and of the committees on which he served.
COMPENSATION OF DIRECTORS
The Company pays directors who are not executive officers of the Company a fee
of $10,000 per year plus $1,000 for the first and $500 for each additional Board
or Committee meeting attended on the same day, plus reasonably incurred travel
and lodging expenses. Chairmen of Committees receive an additional retainer
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<PAGE> 10
of $2,500 per year and a non-employee Chairman of the Board receives an
additional $5,000 retainer per year. Directors receive a fee of $500 for each
written consent related to considering the authorization or taking of an action
without a meeting. Directors may defer all or part of their fees in cash or
stock until their retirement as directors.
OWNERSHIP OF COMMON SHARES
The following table shows, as of April 3, 1999, the number and percent of Common
Shares of the Company beneficially owned by each nominee, director, the officers
listed in the Summary Compensation Table, and all directors and officers as a
group:
<TABLE>
<CAPTION>
Number of
Name Shares (1)(2) Percent (2) (3)
- ---- ------------- ---------------
<S> <C> <C>
John W. Joy 31,432 0.78%
R. Douglas Cowan 188,404 4.59%
R. Cary Blair 7,000 0.17%
Thomas Murdough, Jr. 4,000 0.10%
Richard E. Dunn 1,200 0.03%
William D. Ginn 28,800 0.72%
Richard S. Gray 6,000 0.15%
James H. Miller 20,000 0.50%
Russell R. Gifford 2,100 0.05%
Douglas K. Hall 2,000 0.05%
Karl J. Warnke 99,975 2.45%
David E. Adante 101,410 2.49%
Howard D. Bowles 100,218 2.46%
C. Kenneth Celmer 76,613 1.89%
21 directors and officers
as a group, including
those listed above 1,045,207 23.20%
</TABLE>
- -------------------
1. Other than as described below, beneficial ownership of the Common Shares
listed in the tables is comprised of sole voting and investment power, or
voting and investment power, shared with a spouse.
Includes shares allocated to individual accounts under the Company's 401KSOP
and ESOP Plan (the "KSOP") with respect to which the following
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<PAGE> 11
executive officers have only sole voting power as follows: R. Douglas
Cowan, 22,078 shares, Karl J. Warnke, 9,029 shares, David E. Adante, 11,226
shares, Howard D. Bowles, 13,424 shares, C. Kenneth Celmer, 17,292 shares,
and 143,173 shares by all officers as a group.
2. These include the right to purchase on or before June 2, 1999, upon the
exercise of outstanding stock options, 83,200 Common Shares by Mr. Cowan,
58,000 Common Shares by Mr. Warnke, 58,000 Common Shares by Mr. Adante,
47,600 Common Shares by Mr. Bowles, 39,600 Common Shares by Mr. Celmer and
459,100 Common Shares by all directors and officers as a group.
3. Percentage calculation based on total shares outstanding plus the options
exercisable by the respective individual on or before June 2, 1999, in
accordance with Rule 13d-3(d) of the Securities Exchange Act of 1934.
To the Company's knowledge, as of April 3, 1999, no person or entity was an
owner, beneficial or otherwise, of more than five percent of the outstanding
Common Shares of the Company. Key Trust Company of Ohio, N. A., trustee of the
KSOP, 127 Public Square, 14th Floor, Cleveland, Ohio 44114, had, as of April 3,
1999, certain trustee imposed rights and duties with respect to Common Shares
held by it. The number of Common Shares held in the KSOP as of April 3, 1999 was
1,514,183, 37.65% of the outstanding Common Shares of the Company.
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REMUNERATION OF EXECUTIVE OFFICERS
The table below shows the cash compensation of the five highest paid executive
officers of the Company whose aggregate cash compensation exceeded $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
---------------------------------------------
All Other
Annual
Name and Compen-
Principal Position Year Salary Bonus sation (1)
------------------ ---- ------ ----- ----------
<S> <C> <C> <C> <C>
R. Douglas Cowan 1998 278,907 195,000 1,696
Chairman and 1997 260,577 130,000 2,400
Chief Executive Officer 1996 227,475 80,500 1,310
Karl J. Warnke(2) 1998 172,028 103,100 1,662
President and 1997 165,115 75,650 2,400
Chief Operating Officer 1996 151,091 47,450 1,310
David E. Adante 1998 172,028 100,000 1,710
Executive Vice President, 1997 165,115 75,650 2,400
Chief Financial Officer 1996 152,286 47,450 1,310
and Secretary-Treasurer
Howard D. Bowles 1998 130,677 90,000 1,330
Vice President and 1997 122,308 71,400 2,400
General Manager - 1996 111,942 51,700 1,310
Davey Tree Surgery
Company
C. Kenneth Celmer 1998 130,253 90,100 1,696
Vice President, General 1997 122,308 72,400 2,400
Manager, Residential Services 1996 111,475 57,850 1,310
</TABLE>
______________
(1) All other compensation represents amounts allocated to the participant
accounts for each of the officers under the terms of the Company's 401KSOP
and ESOP.
(2) Mr. Warnke was elected President and Chief Operating Officer in March, 1999.
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OPTION GRANTS IN LAST FISCAL YEAR
The Company made no grants of stock options to any named executive officer
during the last completed fiscal year.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
Value of Unexercised
Number of Unexercised In-The-Money
Options Held at Fiscal Options at Fiscal Year End
Shares Year End (#) ($)(2)
Acquired On Value --------------------------- ---------------------------
Name Exercise (#) Realized($) (1) Exercisable Unexercisable Exercisable Unexercisable
- ---- ------------ --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
R. D. Cowan -0- -0- 83,200 16,800 $1,629,360 $272,160
Karl J. Warnke -0- -0- 58,000 12,000 1,131,220 194,400
David E. Adante -0- -0- 58,000 12,000 1,131,220 194,400
Howard D. Bowles -0- -0- 47,600 8,400 944,200 136,080
C. Kenneth Celmer -0- -0- 39,600 8,400 778,340 136,080
</TABLE>
(1) The value realized upon exercise of options is based on the difference
between the option exercise price and the fair market value at the date of
exercise.
(2) The value of unexercised options is based on the year-end price of $32.00
per share.
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PENSION PLAN TABLE
The table below shows estimated annual benefits payable under the employee
retirement plan to an employee, including officers (other than to an employee
who is subject to a collective bargaining agreement), retiring at age 65, and
electing a life benefit without survivor options, with the years of benefit
service and base compensation indicated. Such benefits are reduced to recognize
in part the Company's cost of Social Security benefits related to service for
the Company. The Company's plans also provide for the payment of benefits to an
employee's surviving spouse or beneficiary.
<TABLE>
<CAPTION>
Final
Average
Base 10 15 20 25 30 35+
Compensation Years Years Years Years Years Years
------------ ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
100,000 5,066 7,599 10,132 12,665 15,198 17,732
125,000 6,566 9,849 13,132 16,415 19,698 22,982
150,000 8,066 12,099 16,132 20,165 24,198 28,232
160,000
and up 8,666 12,999 17,332 21,665 25,998 30,332
</TABLE>
A participant generally will be credited with a year of benefits service for
each year after December 31, 1996, that he was eligible to participate in the
pension plan. An employee's Final Average Annual Compensation is his average W-2
earnings for the years he participated in the plan and for the year 1998 cannot
include compensation in excess of $160,000.
The credited years of service for Messrs. Cowan, Warnke, Adante, Bowles, and
Celmer are 13.4, 10.0, 16.0, 23.0 and 15.1, respectively.
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COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
THE DAVEY TREE EXPERT COMPANY
<TABLE>
<CAPTION>
1993 1994 1995 1996 1997 1998
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
DAVEY 100.0 84 95 131 190 235
S&P 500 Composite-Ltd. 100.0 101 139 171 229 294
S&P Service (Comml. & Consumer)* 100.0 92 124 128 175 144
</TABLE>
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REPORT OF COMPENSATION COMMITTEE
GENERAL
The Compensation Committee of the Board of Directors, composed entirely of non
employee Directors, is responsible for management succession matters, for
administering the Company's executive incentive and benefits programs, and for
establishing salaries for executive officers. The Committee's recommendations in
these matters are presented to the Board of Directors for approval. In its
deliberations, the Committee periodically retains outside professionals to
assess the fairness of the Company's compensation programs and meets frequently
with the Chief Executive Officer of the Company to obtain management's
recommendations on compensation issues.
COMPENSATION POLICIES
The Committee is careful to align executive officer compensation with the
interest of shareholders. The Committee has established a policy whereby a
substantial portion of the compensation of executive officers, including the
chief executive officer, is contingent on the profitability of the Company.
Approximately twenty to forty percent of an executive officer's compensation is
determined based on pre-tax profits of the Company, after a target return on
shareholders' equity is achieved. The fundamental theory of this policy is that
the shareholders of the Company are entitled to a fair pre-tax return on their
investment before any incentive payments are made to executive officers. To the
extent that the efforts of the executive officers result in a higher return on
shareholders' equity, the Committee believes that the officers should be
rewarded. The Committee and the Board of Directors believe that this
compensation policy creates a significant incentive for management of the
Company, which in turn creates long-term benefits for the shareholders.
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BASE SALARY
Base salary levels are largely determined on the basis of comparisons with
similar companies of approximately the same size. The Committee periodically
retains a nationally known compensation consulting firm to conduct a
compensation competitiveness study to determine the adequacy of the Company's
compensation for executive officers compared to the compensation of officers in
comparable companies. The last study was conducted in 1998, and compensation
ranges were established by the Committee for each of the officers on the basis
of job description and market comparisons. The Committee's general policy
regarding base salary is that the Company's executive officers should be
compensated near the "mid-point" of the market range established by the
consultants, giving allowance to experience and provided that the Company's
long-term goals are being achieved. None of the executive officers has an
employment agreement with the Company.
The Committee reviews the performance of each of the officers of the Company
with the Chief Executive Officer at each of its meetings and is particularly
attentive to an assessment of the officers' performance against goals,
demonstrated capabilities and development of subordinates. The salary
adjustments for the Chief Executive Officer are determined solely by the
Committee after an evaluation of the same criteria used for other executive
officers. The officers of the Company are generally on a 12-15 month salary
adjustment cycle.
INCENTIVE COMPENSATION
In 1979, the Board of Directors adopted a Management Incentive Compensation Plan
designed to reward the Company's management group, which includes approximately
50 people, for above average profit performance. The Plan provides for the
calculation of a
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"Bonus Fund" based on the average of the last three years' pre-tax profit
performance. Under the terms of the Plan, a required return on the Shareholders'
Equity is deducted from pre-tax profits, and a percentage of any excess amount
is designated as a "Bonus Base". The Bonus Fund for the year equals an average
of the Bonus Base for each of the preceding three years. This Bonus Fund is
allocated by the Committee to the management group based on individual
performance, operating group performance, as well as overall Company
performance.
In 1994, the shareholders approved the 1994 Omnibus Stock Plan (the Plan), which
consolidates into a single plan provisions for the grant of stock options, other
stock-based incentives, and the maintenance of an employee stock purchase
program. The Plan replaced the 1982 Employee Stock Purchase Plan and the 1987
Incentive Stock Option Plan, under which no future grants will be made.
Provisions of the Plan give the committee broad discretion to fashion the terms
of awards in order to provide Davey Tree's employees with stock-based incentives
that are appropriate under the circumstances. It is designed to foster long-term
growth and performance by motivating employees through stock-based incentives
and ownership, as well as enhance the Company's ability to attract and retain
qualified employees and directors. Option grants are based on the fair market
value of the Company's Common Shares on the date of grants, as established by an
independent valuation firm, Management Planning, Inc. All employees of Davey
Tree and its subsidiaries are eligible to participate in the Plan, and all non
employee directors of Davey Tree are eligible to receive director options under
the Plan. The committee believes the Plan provides incentives to increase the
market performance of the Company's shares, thereby aligning the Company's
interests with those of the shareholders.
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By the Compensation Committee of the Board of Directors:
R. Cary Blair, Richard S. Gray, James H. Miller, and Russell R. Gifford
INDEBTEDNESS OF MANAGEMENT
No executive officer, director, nominee or affiliate of any such person was
indebted to the Company in excess of the General Rules and Regulations under the
Securities Exchange Act of 1934 at reporting requirements any time during the
year 1998.
INDEPENDENT AUDITORS
Deloitte & Touche LLP has been appointed as the Company's independent auditors
for the fiscal year ending December 31, 1999. Deloitte & Touche was created by
the merger of Touche, Ross & Co. with Deloitte, Haskins and Sells in 1989.
Touche, Ross & Co. has served as the Company's independent auditors since 1975.
A representative of Deloitte & Touche is expected to be present at the meeting.
The representative will be given an opportunity to make a statement if he or she
desires to do so and to respond to questions regarding Deloitte & Touche's
examination of the Company's financial statements and records for the fiscal
year ended December 31, 1998.
GENERAL
VOTING AT THE MEETING
Shareholders of record at the close of business on April 3, 1999 (the record
date) are entitled to notice of and to vote at the meeting. On that date, a
total of 4,021,646 of the Company's Common Shares were outstanding and entitled
to vote. Each of the Company's Common Shares is entitled to one vote.
Each shareholder has the right to vote cumulatively if any shareholder gives
notice in writing to the President,
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any Vice President or the Secretary of the Company at least 48 hours before the
time set for the meeting and an announcement of the notice is made at the
beginning of the meeting by the Chairman or the Secretary, or by or on behalf of
the shareholder giving notice. If cumulative voting is in effect, shareholders
will be entitled to cast a number of votes equal to the number of shares voting
multiplied by the number of directors to be elected. A shareholder may cast all
of these votes for one nominee or distribute them among several nominees, as
that shareholder sees fit. If cumulative voting is in effect, shares represented
by each properly signed proxy card will also be voted on a cumulative basis,
with the votes distributed among the nominees in accordance with the judgment of
the persons named in the proxy card.
Under Ohio law, directors are elected by the votes of shareholders exercising a
majority of the voting power of the Company present at a meeting at which a
quorum is present, and proposals are adopted or approved by the vote of a
specified percentage of the voting power of the Company. Abstentions and non
votes are tabulated in determining the votes present at the meeting.
Consequently, an abstention or a non-vote has the same effect as a vote against
a director nominee, as each abstention or non-vote would be one less vote for a
director nominee.
If any of the nominees listed on page three becomes unable or declines to serve
as a director, each properly signed proxy card will be voted for another person
recommended by the Board of Directors. However, the Board has no reason to
believe that this will occur.
The Board of Directors knows of no other matters that will be presented at the
meeting. However, if other matters do properly come before the meeting, the
person named in the proxy card will vote on these matters in accordance with
their best judgment.
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<PAGE> 21
SHAREHOLDER PROPOSALS
Any shareholder who wishes to submit a proposal to be considered for inclusion
in next year's Proxy Statement should send the proposal to the Company on or
before December 17, 1999. Additionally, a shareholder may submit a proposal for
consideration at next year's Annual Meeting of Shareholders, but not for
inclusion in next year's Proxy Statement, if that proposal is submitted on or
before March 2, 2000.
EXPENSES OF REQUESTING PROXIES
The Company will bear the expense of preparing, printing, and mailing this
Notice and Proxy Statement. In addition to requesting proxies by mail, officers
and regular employees of the Company may request proxies by telephone or in
person. The Company will ask custodians, nominees, and fiduciaries to send proxy
material to beneficial owners in order to obtain voting instructions. The
Company will, upon request, reimburse them for their reasonable expenses for
mailing the proxy material.
ANNUAL REPORT
The Company's Annual Report to Shareholders, including financial statements for
the fiscal year ended December 31, 1998, is being mailed to shareholders of
record with this Proxy Statement.
For the Board of Directors,
DAVID E. ADANTE
Secretary
April 16, 1999
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YOUR VOTE IS IMPORTANT.
PLEASE SIGN, DATE AND
RETURN YOUR PROXY.
<PAGE> 23
THE DAVEY TREE EXPERT COMPANY
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON MAY 18, 1999
THIS PROXY IS SOLICITED BY YOUR BOARD OF DIRECTORS, WHICH RECOMMENDS THAT YOU
VOTE FOR THE NOMINEES LISTED IN ITEM 1 AND FOR ITEM 2.
At the Annual Meeting of Shareholders of the Corporation to be held May 18,
1999, and at any adjournment, David E. Adante, Howard D. Bowles, C. Kenneth
Celmer, Roger C. Funk, Richard A. Ramsey and Karl J. Warnke, and each of them,
with full power of substitution in each, are hereby authorized to represent me
and to vote my shares on the following:
1. Elect two Directors to the class to serve for a three year term of office
expiring at the Corporation's 2002 Annual Meeting of Shareholders. The
nominees of the Board of Directors are: R. Douglas Cowan and Russell R.
Gifford.
(Instruction: On the line below, write the name of any nominee or nominees for
whom authority to vote is withheld. This proxy cannot be voted for a greater
number of persons than the number of nominees named.)
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2. Any other matter that may properly come before the meeting.
UNLESS OTHERWISE SPECIFIED ABOVE, THIS PROXY WILL BE VOTED FOR THE NOMINEES
LISTED IN ITEM 1.
Signed the day of , 1999
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Please sign here
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Joint Owner, if any, sign here
Please sign this Proxy exactly as your name appears above. If the address on
this Proxy is incorrect, please note your correct address.
Please check this box if you plan to attend the Annual Meeting of Shareholders.
[ ]
<PAGE> 24
THE DAVEY TREE EXPERT COMPANY
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON MAY 18, 1999
THIS VOTING INSTRUCTION IS SOLICITED BY KEY TRUST COMPANY OF OHIO, N.A. AS
TRUSTEE OF THE DAVEY 401KSOP AND ESOP (THE "TRUSTEE").
At the Annual Meeting of Shareholders of the Corporation to be held May 18,
1999, and at any adjournment, David E. Adante, Howard D. Bowles, C. Kenneth
Celmer, Roger C. Funk, Richard A. Ramsey and Karl J. Warnke, and each of them,
with full power of substitution in each, shall vote on the following in
accordance with my directions to the Trustee, as shown below.
The Board of Directors recommends that you vote for the nominees listed in Item
1 and for Item 2.
1. Elect two Directors to the class to serve for a three year term of office
expiring at the Corporation's 2002 Annual Meeting of Shareholders. The
nominees of the Board of Directors are:
R. Douglas Cowan and Russell R. Gifford.
(Instruction: On the line below, write the name of any nominee or nominees for
whom authority to vote is withheld. This voting instruction cannot be voted for
a greater number of persons than the number of nominees named.)
- -------------------------------------------------------------------------------
2. Any other matter that may properly come before the meeting.
UNLESS OTHERWISE SPECIFIED ABOVE, THE TRUSTEE WILL VOTE THE SHARES SPECIFIED
BELOW FOR THE NOMINEES LISTED IN ITEM 1.
To Key Trust Company of Ohio, N.A., Trustee of The Davey 401KSOP and ESOP: As a
participant in the Plan, I hereby direct the Trustee to vote in person or by
proxy as shown below:
Instruction: Check one or both boxes:
[ ] I direct the Trustee to vote the shares allocated to my account as of the
record date in accordance with this voting instruction card.
[ ] I direct the Trustee to vote the proportionate number of "non-directed"
shares (shares allocated to other participants in the Plan for which the
Trustee does not receive voting instructions) for which I may give voting
instructions under the terms of the Plan in accordance with this voting
instruction card.
If you do not complete and return this card, your shares will be voted, as
provided in the Plan, proportionately in accordance with directions received
from other participants in the Plan. If you wish to vote the non-directed
shares differently from the shares allocated to your account, you may do so by
requesting a separate voting instruction card from the Trustee at Key Trust,
Attn: William Jordan, 127 Public Square, 14th Floor, Cleveland, OH 44114-1306.
Signed the day of , 1999.
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Please sign this Proxy exactly as your name appears on the mailing label.
Please check this box if you plan to attend the Annual Meeting of Shareholders.
[ ]
