DEVON GROUP, INC. 281 Tresser Boulevard, Suite 501, Stamford,
Connecticut 06901-3227
June 19, 1997
Dear Stockholder:
You are cordially invited to attend our Annual Meeting of
Stockholders which will be held on Thursday, July 24, 1997, at
10:00 A.M. (local time) at The Rockefeller Center Club, 30
Rockefeller Plaza, The Radio City Suite, 64th Floor, New York,
New York. Enclosed is the official Notice of Annual Meeting
together with the Proxy Statement, your Proxy Card, and the 1997
Annual Report to Stockholders.
As always, we look forward to our Annual Meeting as an
opportunity to report on the Company's performance for the past
fiscal year and to offer some comments on its outlook for the
future. In addition, we welcome your comments and suggestions
which in the past have often proved beneficial.
If it is convenient for you to do so, we hope you will attend
the meeting. If you cannot, please complete, sign, date, and
return the enclosed Proxy Card in the envelope provided at your
earliest convenience to ensure that your shares will be
represented.
Sincerely,
Marne Obernauer, Jr.
Chairman of the Board
<PAGE>
DEVON GROUP, INC.
281 Tresser Boulevard, Suite 501
Stamford, Connecticut 06901-3227
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on July 24, 1997
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders
(the "Annual Meeting") of Devon Group, Inc., a Delaware corporation
(the "Corporation"), will be held at The Rockefeller Center Club,
30 Rockefeller Plaza, The Radio City Suite, 64th Floor, New York,
New York, on July 24, 1997, at 10:00 A.M., local time, for the
following purposes:
1. to elect a Board of seven (7) directors for the ensuing
year and until their respective successors have been duly
elected and qualified;
2. to ratify the selection of the firm of KPMG Peat Marwick
LLP as auditors for the Corporation for the fiscal year ending
March 31, 1998; and
3. to transact such other business as may properly be brought
before the meeting or any adjournments thereof.
The Board of Directors has fixed the close of business on June 6,
1997, as the record date for the determination of stockholders
entitled to notice of, and to vote at, the Annual Meeting.
Accordingly, only stockholders of record on that date will be entitled
to vote. A list of such stockholders will be available at the time
and place of the Annual Meeting and, during the ten (10) days prior to
the Annual Meeting, at the Corporation's office at 281 Tresser
Boulevard, Suite 501, Stamford, Connecticut.
Please vote, sign, date, and return the enclosed Proxy Card in the
accompanying envelope at your earliest convenience. If you return
your Proxy Card, you may nevertheless attend the Annual Meeting and
vote your shares in person.
By Order of the Board of Directors,
Robert A. Frasco
Secretary
Stamford, Connecticut
June 19, 1997
TO ASSURE THAT YOUR SHARES ARE REPRESENTED AT THE MEETING, PLEASE
VOTE, SIGN, DATE, AND PROMPTLY RETURN THE ENCLOSED PROXY CARD FOR
WHICH A STAMPED RETURN ENVELOPE IS PROVIDED.
<PAGE>
DEVON GROUP, INC.
281 Tresser Boulevard, Suite 501
Stamford, Connecticut 06901-3227
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
JULY 24, 1997
The accompanying proxy, first being mailed to stockholders on or
about June 19, 1997, is solicited by the Board of Directors of Devon
Group, Inc., a Delaware corporation (the "Corporation"), for use at
the Annual Meeting of Stockholders (the "Annual Meeting") to be held
on July 24, 1997, and at any adjournments thereof, notice of which is
attached hereto.
Shares represented by a duly executed Proxy Card in the form
enclosed herewith received by the Corporation prior to the Annual
Meeting will be voted at the Annual Meeting in accordance with the
choices specified by the stockholder. If no choice is specified, the
shares will be voted FOR the election of the nominees for director
named below and FOR the proposal referred to in item 2 in the Notice
of Annual Meeting of Stockholders and described in this Proxy
Statement.
Any stockholder may revoke a proxy at any time prior to its
exercise by delivering a later dated proxy or a written notice of
revocation to the Secretary of the Corporation at the address of the
Corporation set forth above or by voting in person at the Annual
Meeting. If a stockholder does not plan to attend the Annual Meeting,
any proxy or notice should be returned for receipt by the Corporation
not later than the close of business on July 18, 1997, the Friday
preceding the Annual Meeting. The persons named as proxies on the
Proxy Card are officers of the Corporation.
The cost of solicitation will be borne by the Corporation,
including expenses in connection with preparing, assembling, and
mailing this Proxy Statement. Such solicitation will be made by mail
and may also be made by the Corporation's officers or employees
personally or by telephone or telecopy. In addition, the Corporation
has engaged the services of Morrow & Co. to assist in the distribution
of proxies for a fee of approximately $1,500 plus expenses.
The Board of Directors has fixed the close of business on June 6,
1997, as the record date for the Annual Meeting. On that date the
Corporation had outstanding 7,283,817 shares of Common Stock. Only
holders of Common Stock of record at the close of business on June 6,
1997, will be entitled to vote at the Annual Meeting or any
adjournments thereof, and each stockholder will be entitled to one
vote for each share held, which may be given in person or by proxy
authorized in writing.
No business other than that set forth in this Proxy Statement and
the accompanying Notice of Annual Meeting is expected to come before
the Annual Meeting. However, should any other matters requiring a
vote of stockholders arise, including a question of adjourning the
Annual Meeting, the persons named in the accompanying proxy will vote
thereon according to their best judgment in the interest of the
Corporation.
The mailing address of the Corporation's principal executive
office is 281 Tresser Boulevard, Suite 501, Stamford, Connecticut
06901-3227.
<PAGE>
PRINCIPAL HOLDERS OF VOTING SECURITIES
The following table sets forth the holdings of those persons known
to the Corporation to own beneficially 5% or more of the
Corporation's Common Stock as of May 23, 1997. Unless otherwise
indicated, the named person has sole voting and dispositive power
with respect to the shares beneficially owned. This information is
based in part on records of the Corporation and in part on
information received from the respective security holders.
<TABLE>
<CAPTION>
Name and Address Number of Percent
of Beneficial Owner Shares Owned of Class
<S> <C> <C>
First Pacific Advisors, Inc................1,017,400 13.97
11400 West Olympic Boulevard
Los Angeles, California 90064
Marne Obernauer, Jr. (1).....................857,999 11.78
c/o Devon Group, Inc.
450 Park Avenue
New York, New York 10022
Fidelity Management & Research Company.......630,600 8.66
82 Devonshire Street
Boston, Massachusetts 02109
Neumeier Investment Counsel..................629,800 8.65
26435 Carmel Rancho Boulevard
Carmel, California 93923
(1) Includes an aggregate of 12,000 shares held by Mr. Obernauer, Jr.
as trustee, for trusts created for the benefit of his two sons, a
niece, and a nephew, over which Mr. Obernauer, Jr. has voting and
investment power.
</TABLE>
ELECTION OF DIRECTORS
Seven directors, all of whom are presently directors of the
Corporation, are to be elected at the Annual Meeting, to serve until
the 1998 Annual Meeting of Stockholders and until their respective
successors have been duly elected and qualified. The persons named
as proxies in the accompanying Proxy Card, who have been designated
by management, intend to vote, unless otherwise instructed in such
Proxy Card, FOR the nominees listed below; that is, for the election
of Messrs. Obernauer, Jr., Blank, Dinzole, Gisel, Harrington,
Obernauer, and Palmer. If any of these nominees should be unable to
serve, the proxies will vote for the election of such other person or
persons as shall be determined in accordance with their best
judgment.
Information Pertaining to Nominees
The following table sets forth the name and the age of each
nominee, the principal occupation of each nominee during the past
five years, and any other directorships held by each nominee in any
company subject to the reporting requirements of the Securities
Exchange Act of 1934 or in any company registered as an investment
company under the Investment Company Act of 1940.
<PAGE>
Director Principal Occupation and
Nominees Age Since Other Directorships Held
Marne Obernauer, Jr....54 1977 Chairman of the Board of
Directors and Chief Executive
Officer of the Corporation
since June 1986; Mr. Obernauer,
Jr. is the son of Mr. Obernauer.
Robert S. Blank........56 1992 Partner of Whitcom Partners since
January 1973; a director of Toll
Brothers, Inc.
John W. Dinzole........69 1969 President and Chief Operating
Officer of the Corporation since
June 1986; Chairman of Black Dot
Graphics, Inc. (a subsidiary of
the Corporation) since October
1992; Chairman and Chief Executive
Officer of Black Dot Graphics,
Inc. from 1969 to October 1992.
William G. Gisel.......81 1982 Retired Chairman, President, and
Chief Executive Officer of Bell
Aerospace Textron, a division of
Textron Inc.
Thomas J. Harrington...57 1990 President and Chief Executive
Officer of Spectrum Capital, Ltd.
since July 1985.
Marne Obernauer........78 1971 Chairman of the Executive
Committee of the Board of
Directors of the Corporation since
June 1986; Chairman of the Board
of Directors of BDH Inc., the
parent of Beverage Distributors
Corporation, a former division of
the Corporation, since June 1986.
Edward L. Palmer.......79 1982 Retired Chairman of the Executive
Committee and Director of Citicorp
and Citibank, N.A.; a director of
Holmes Protection Group, Inc.,
Lanxide Corporation, and
SunResorts Ltd., N.V.
The Board of Directors recommends that stockholders vote FOR the
election of each of the seven nominees.
Operation of the Board of Directors
The Board of Directors of the Corporation held four meetings in
fiscal 1997. Each director attended at least 75 percent of all
regular meetings of the Board of Directors and meetings held by all
committees of the Board on which he served during fiscal 1997.
Each director who is not also an employee of the Corporation
receives an annual director's fee of $20,000. In addition, for each
day that a meeting of the Board of Directors or any committee thereof
is held, each director receives a fee of $1,000 for attendance at such
meeting, and an additonal $250 for each meeting in excess of one held
on the same day.
The members of the Corporation's Audit Committee are Messrs.
Harrington, Blank, and Gisel. The principal functions of the Audit
Committee are to ascertain the existence of an effective accounting,
budgeting, and internal control system, to review both the independent
and internal audit functions, and to be available to meet with the
independent auditors to resolve problems, if any, that may arise in
connection with audits or otherwise. The Audit Committee held three
meetings during fiscal 1997.
The members of the Corporation's Compensation Committee are Messrs.
Gisel, Blank, and Palmer. The principal functions of the Compensation
Committee are to fix the compensation of senior officers of the Corporation
and subsidiaries and to establish, modify, and maintain the
retirement, incentive, and stock option plans of the Corporation and
its subsidiaries. The Compensation Committee held two meetings during
fiscal 1997.
<PAGE>
The members of the Corporation's Executive Committee are Messrs.
Obernauer, Harrington, and Obernauer, Jr. The principal functions of
the Executive Committee are to act on behalf of the Board of Directors
with respect to such matters as the Board of Directors may
specifically designate and to have such powers as the Board of
Directors may specifically delegate from time to time. The Executive
Committee did not meet during fiscal 1997.
The Corporation has no Nominating Committee.
The following table sets forth the amount and percentage of Common
Stock of the Corporation beneficially owned as of May 23, 1997, by the
Chief Executive Officer and the other four most highly compensated
executive officers (the "Named Executives"), and by each director and
all directors and executive officers as a group. Unless otherwise
indicated, the named individuals have sole voting and dispositive
power with respect to the shares of Common Stock.
<TABLE>
<CAPTION>
Common Stock
Amount and
Nature of
Beneficial Percent
Name Ownership of Class
<S> <C> <C>
Robert S. Blank.............................. 45,000(1) *
John W. Dinzole.............................. 160,500(2) 2.20
Howard A. Fiedler............................ 106,393(3) 1.46
Terence M. Flynn............................. 200,068(4) 2.75
William G. Gisel............................. 3,000 *
Thomas J. Harrington......................... 14,000 *
Bruce K. Koch................................ 8,000 *
Marne Obernauer.............................. 300,000(5) 4.12
Marne Obernauer, Jr.......................... 857,999(6) 11.78
Edward L. Palmer............................. 87,874 1.21
Total of all Directors and Executive Officers
(14 Individuals)............................ 1,887,743 25.92
* Less than 1%
(1) Includes 5,000 shares held in a trust of which Mr. Blank is a
beneficiary and a trustee.
(2) Includes 160,500 shares held in a trust of which Mr. Dinzole
is a beneficiary and the trustee.
(3) Excludes 21,500 shares held by Mr. Fiedler's wife, in which
Mr. Fiedler disclaims all beneficial interest.
(4) Includes 169,559 shares held by a corporation of which Mr.
Flynn is the sole shareholder.
(5) Excludes 5,000 shares held by Mr. Obernauer's wife, in which
Mr. Obernauer disclaims all beneficial interest.
(6) Includes an aggregate of 12,000 shares held by Mr. Obernauer,
Jr., as trustee, for trusts created for the benefit of his
two sons, a niece, and a nephew, over which Mr. Obernauer,
Jr. has voting and investment power.
</TABLE>
<PAGE>
Section 16(a) Beneficial Ownership Reporting Compliance
A partnership in which Mr. Dinzole had a beneficial ownership,
gifted 3,500 shares of Common Stock in March 1997, and Mr.Dinzole
did not report such transfer on Form 5 on a timely basis.
Mr. Dinzole informed the Corporation that he filed a Form 5 in
June 1997 to report the transaction.
REMUNERATION OF EXECUTIVE OFFICERS
Compensation Committee Report
As members of the Compensation Committee, it is our duty to set the
base salary compensation for the executive officers and to administer
the annual bonus plan of the Corporation (the "Corporate Bonus Plan")
and the bonus plans of its subsidiaries (the "Subsidiary Bonus
Plans"). As part of this process, we annually review the compensation
levels of senior management, evaluate the performance of senior
management, and consider management succession and related matters.
We take into account how total compensation compares to compensation
paid by similar companies as well as the Corporation's performance.
The compensation policy of the Corporation for its key executives
is established by the Compensation Committee. A significant portion
of the annual compensation of such executives relates to and is
contingent upon the performance of the Corporation. Under the various
bonus plans, bonuses are paid based on the performance of the
subsidiary to which the officer is assigned, or, in the case of
Messrs. Obernauer, Jr., Dinzole, and Koch, the performance of the
Corporation on a consolidated basis. For fiscal 1997 maximum annual
bonus compensation amounted to 92.5% of base salary for executives in
the Corporate Bonus Plan. Executives participating in the Subsidiary
Bonus Plans are not subject to individual maximums. The maximum
earned bonus that may be paid in any one year in any of the plans is
50% of a participant's base salary (not including carryovers). The
remaining earned but unpaid bonus amount is paid to participants in
equal installments at the end of each of the succeeding three fiscal
years. In the case of a termination of employment, such carryover
amounts may or may not be paid depending upon the circumstances of the
termination.
The Corporation's performance, or that of a subsidiary, for
purposes of compensation decisions is measured under the annual bonus
plan against goals established and approved by the Compensation
Committee. The Corporate Bonus Plan goals specify targeted levels of
return on equity, and Subsidiary Bonus Plan goals are based on
targeted levels of income before interest and taxes
combined with targets related to return on capital employed.
Executives of the Corporation and its subsidiaries are also
eligible to receive stock options under the Corporation's Non-
Qualified Stock Option Plan (the "NSO Plan"), its 1993 Non-Qualified
Stock Option Plan (the "1993 NSO Plan"), and its 1995 Non-Qualified
Stock Option Plan (the "1995 NSO Plan"). The primary purposes of
the NSO Plan, the 1993 NSO Plan, and the 1995 NSO Plan are: (a) to
enable executives to acquire shares of the Corporation's Common Stock
pursuant to the terms of these Plans, thereby increasing their
personal involvement and interest in the Corporation; (b) to enable
the Corporation to attract and retain the services of key employees
necessary to the growth and development of the Corporation; and (c) to
provide a means of rewarding outstanding performance. All of the
Plans are administered by the Compensation Committee (the NSO Plan
may also be administered by the Board of Directors), which is
authorized to designate the optionees, exercise prices, exercise
periods, and dates of grants. The exercise price may not be less
than 100% of the fair market value of the Common Stock on
the date of grant. In fiscal 1997, the Compensation Committee granted
155,000 options under the 1995 NSO Plan, all at $26.00 per share. Mr.
Koch received stock options to acquire 25,000 shares of Common Stock,
and Mr. Fiedler received stock options to acquire 15,000 shares of
Common Stock. The Corporation also maintains insurance, Section
401(k), profit sharing, and other retirement plans for its employees.
<PAGE>
Mr. Obernauer, Jr.'s base salary for fiscal 1997 was based upon
his continuing employment agreement with the Corporation entered into
December 30, 1982 (the "Employment Agreement") which provides, among
other things, for annual increases to be determined by the Board of
Directors in its sole discretion. Mr. Obernauer, Jr.'s base salary
was increased to $370,000 effective August 1, 1996. In granting the
5.7% increase ($20,000), the Compensation Committee considered such
factors as salaries paid to other similarly situated CEOs and the
Corporation's current performance trends. The perquisites and other
benefits received by Mr. Obernauer, Jr. are provided pursuant to his
Employment Agreement and are consistent with those provided other
similarly situated CEOs.
No member of the Compensation Committee is a former or current
officer or employee of the Corporation or any of its subsidiaries.
Compensation Committee
William G. Gisel, Chairman
Robert S. Blank
Edward L. Palmer
May 23, 1997
<PAGE>
Summary Compensation Table
Set forth below is information with respect to the remuneration
paid by the Corporation and its subsidiaries during the fiscal years
ended March 31, 1997, 1996, and 1995, to the Named Executives.
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
Awards Payouts
Securities
Other Restricted Underlying
Name and Annual Stock Options/ LTIP All Other
Principal Fiscal Salary Bonus Compensation Award(s) SARs Payouts Compensation
Position Year ($) ($) ($) (1) ($) (#) ($) ($) (3)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Marne 1997 363,333 336,083 - - - - 4,187
Obernauer, 1996 338,333 338,333 - - - - 5,393
Jr. 1995 309,333 309,333 - - - - 7,371
Chairman
and CEO
John W. 1997 373,333 345,333 105,700(2) - - - 4,190
Dinzole 1996 350,000 350,000 105,700(2) - - - 7,784
President 1995 326,667 326,667 105,700(2) - - - 10,824
and COO
Bruce K. 1997 224,000 207,200 - - 25,000 - 4,170
Koch 1996 212,333 212,333 - - 50,000 - 5,369
Exec. V.P. 1995 201,333 201,333 - - - - 7,337
Operations
and Finance
and CFO
Howard A. 1997 200,000 - - - 15,000 - 4,236
Fiedler 1996 195,000 330,000 - - 50,000 - 7,787
CEO, Black 1995 190,000 300,000 - - - - 10,797
Dot
Graphics,
Inc.
Terence M. 1997 241,525 118,773 70,000(2) - - - 6,628
Flynn 1996 221,813 115,000 70,000(2) - - - 6,428
President, 1995 209,463 115,400 70,000(2) - - - 5,828
Portal
Publications,
Ltd.
(1)Perquisites do not exceed the lesser of either $50,000 or 10% of total
salary and bonus.
(2)Reflects amounts received pursuant to the Corporation's Executive
Retirement Compensation Plan.
(3)Includes amounts allocated during fiscal 1997 by the Corporation
under subsidiary profit sharing and savings plans as
follows: Messrs. Obernauer, Jr. $4,187, Dinzole $4,190, Koch $4,170,
Fiedler $4,236, and Flynn $800. Also includes $5,828 of premiums
paid by the Corporation for term life insurance on the life of Mr. Flynn.
</TABLE>
<PAGE>
Option Grants in Last Fiscal Year
The following table sets forth for each of the Named Executives,
the number of stock options granted during fiscal 1997 pursuant to
the NSO Plan, 1993 NSO Plan, and the 1995 NSO Plan, the percentage of
total grants to all employees represented by such grant, the per
share exercise price, the expiration date, and the potential
realizable value of each grant based on assumed annual rates of stock
price appreciation of 5% and 10% compounded over the actual term of
each option or grant.
<TABLE>
<CAPTION>
Potential Realizable
Value at Assumed
Annual Rates of
Stock Price
Appreciation for
Individual Grants Option Term
Number of % of Total
Securities Options Exercise
Underlying Granted to or Base
Options Employees Price Expiration 5% 10%
Name Granted in Fiscal Year ($/Sh) Date ($) ($)
<S> <C> <C> <C> <C> <C> <C>
Marne Obernauer, Jr. - - - - - -
John W. Dinzole - - - - - -
Bruce K. Koch 25,000 16.13% 26.00 7/30/02 221,062 501,515
Howard A. Fiedler 15,000 9.68% 26.00 7/30/02 132,637 300,909
Terence M. Flynn - - - - - -
</TABLE>
Aggregated Option Exercises In Last Fiscal Year and Fiscal Year-end
Option Values
The following table sets forth for each of the Named Executives,
any stock options exercised pursuant to the NSO Plan, 1993 NSO Plan,
and 1995 NSO Plan, the net value realized upon exercise (closing price
on the date of exercise minus exercise price), the number of options
held at fiscal year-end, and the aggregate value of in-the-money
options held at fiscal year-end (based on year-end closing price minus
exercise price).
<TABLE>
<CAPTION>
Number of Value of Unexercised
Shares Acquired Value Unexercised Options In-the-Money Options
on Exercise Realized at Fiscal Year-end at Fiscal Year-end
Name (#) ($) (#) ($)
(Exercisable/Unexercisable) (Exercisable/Unexercisable)
<S> <C> <C> <C> <C>
Marne Obernauer, Jr. - - - -
John W. Dinzole - - - -
Bruce K. Koch - - 37,500/89,000 550,250/370,875
Howard A. Fiedler - - 24,000/76,000 228,375/270,375
Terence M. Flynn - - - -
</TABLE>
<PAGE>
Executive Retirement Compensation Plan
The Corporation's Executive Retirement Compensation Plan (the
"Retirement Plan") is a noncontributory and unfunded defined benefit
plan which is not subject to the requirements of the Employee
Retirement Income Security Act of 1974. Eligibility for and level of
participation in the Retirement Plan is at the sole discretion of the
Compensation Committee of the Board of Directors. Retirement
contracts entered into with each participant in the Retirement Plan
establish the amounts to be allocated annually to such participant's
retirement compensation account. Such amounts are determined
separately for each participant. Each retirement account accrues
interest at the rate of 6% per annum and establishes the benefit
levels which such participant will be eligible to receive upon
retirement at age 65. Benefits are paid for the life of the
participant if such participant shall have remained in the employ of
the Corporation until age 65. Since the Retirement Plan is not
funded, these allocated amounts are currently expensed but not paid.
If a participant retires or dies or his retirement contract is
otherwise terminated before he reaches age 65, a benefit equal to the
value at such date of all allocations to his retirement compensation
account becomes payable to the participant or his designated
beneficiary in 120 monthly installments.
The following table reflects amounts expensed (but not paid) by the
Corporation during fiscal 1997, estimated annual benefits at March 31,
1997 (assuming employment until age 65 and based upon current bonus
level, limited to 50% of salary), and credited years of service for
each of the Named Executives:
Estimated Years
Fiscal 1997 Annual Benefits of
Amounts Expensed at Age 65 Service
Marne Obernauer, Jr.... $ 64,810 $229,277 23
John W. Dinzole........ 50,892 105,700 28
Howard A. Fiedler...... 33,964 70,000 28
Terence M. Flynn....... 34,322 70,000 27
Bruce K. Koch.......... - - 19
Total of all Named Executives $183,988 $474,977
As required by the Retirement Plan, Messrs. Dinzole and Flynn
receive annual payments under the Retirement Plan in the amounts of
$105,700 and $70,000, respectively.
Executive Agreements
The Corporation (or a subsidiary of the Corporation) has entered
into separate employment agreements with each of Messrs. Obernauer,
Jr., Dinzole, Fiedler, Flynn, and Koch. Set forth below is a
description of the principal terms of the employment agreements with
each Named Executive.
The Corporation agrees to employ the Named Executive unless and
until the Corporation shall give him written notice of termination at
least one year prior to an anniversary date defined in the agreement.
The Named Executive agrees to serve the Corporation in such executive
capacities as may be determined by the Board of Directors and shall
devote his full time to the affairs of the Corporation. The Named
Executive receives a base compensation amount, which may be increased
by the Board of Directors, and an incentive bonus in accordance with
existing plans. The employment agreements for Messrs. Obernauer, Jr.,
Dinzole, and Flynn provide for their participation in the Corporation's
Executive Retirement Compensation Plan. Each employment agreement
gives the Named Executive the right to receive benefits under any other
incentive, retirement, group life, health, or accident insurance,
hospitalization, or other benefit plan which may be in effect at the
Corporation. The Corporation is also obligated to supply an automobile
to Messrs. Obernauer, Jr., Dinzole, and Flynn and to reimburse them for
all business expenses incurred in connection with the performance of
their duties. Each employment agreement may be terminated by the
Corporation for any illness or incapacity of the Named Executive
extending beyond a six-month period by giving him thirty days notice of
termination at the expiration of the six-month period and at any time
prior to his return to employment and performance of his full duties
thereunder. Each employment agreement will also terminate upon the
Named Executive's death, and the Corporation retains the right to
terminate the Named Executive's employment for cause (as described
therein) at any time.
<PAGE>
PERFORMANCE GRAPH
The following line graph compares, over a five-year period, the
cumulative return, calculated on a dividend reinvested basis, on a
$100.00 investment on April 1, 1992 in the Corporation's Common Stock,
the S & P 500 market index, and a Corporation-chosen peer group. The
Corporation's fiscal year ends on March 31.
3/31/93 3/31/94 3/31/95 3/31/96 3/31/97
Devon Group, Inc. $256.14 $259.65 $407.02 $400.00 $414.04
S & P 500 $115.24 $116.95 $135.15 $178.55 $213.95
Peer Group* $111.81 $122.43 $121.75 $138.33 $143.95
*The companies that comprise the Corporation-chosen peer group are
Banta Corporation, Cadmus Communications Corporation, R.R. Donnelley &
Sons Company, Gibson Greetings, Inc., and Graphic Industries, Inc., all
of which are engaged in businesses similar to that of the Corporation.
<PAGE>
RATIFICATION OF SELECTION OF AUDITORS
The Board of Directors of the Corporation has selected KPMG Peat
Marwick LLP as the firm of independent auditors to audit the accounts
of the Corporation and its subsidiaries for the fiscal year ending
March 31, 1998. This firm, which has acted as auditors for the
Corporation since 1970, expects to have a representative at the
Annual Meeting who will have the opportunity to make a statement, and
who will be available to answer appropriate questions. If the
stockholders do not ratify the selection of KPMG Peat Marwick LLP,
the Board of Directors will reconsider its selection. A majority of
the votes cast at the Annual Meeting will be required for
ratification.
The Board of Directors recommends that stockholders vote FOR
the ratification of the selection of KPMG Peat Marwick LLP.
STOCKHOLDERS' PROPOSALS
The Corporation will consider including a stockholder's
proposal for action at its 1998 Annual Meeting of Stockholders in the proxy
material to be mailed to its stockholders in connection with that
Meeting if such proposal is received at the principal office of the
Corporation no later than February 20, 1998. In order to curtail
controversy as to the date on which a proposal is received by the
Corporation, it is suggested that proponents submit their proposals
by certified mail, return receipt requested. There were no proposals
received by the Corporation for the 1997 Annual Meeting.
By Order of the Board of Directors,
Robert A. Frasco
Secretary
June 19, 1997
<PAGE>
DEVON GROUP, INC.
281 Tresser Boulevard, Suite 501
Stamford, Connecticut 06901-3227
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE
CORPORATION
The undersigned hereby appoints Robert H. Donovan, Robert A.
Frasco, and Bruce K. Koch as Proxies, each with the power to
appoint his substitute, and hereby authorizes each of them
separately without the other to represent and to vote as designated
below, all the shares of common stock of Devon Group, Inc. held of
record by the undersigned on June 6, 1997, at the annual meeting of
stockholders to be held at The Rockefeller Center Club, 30
Rockefeller Plaza, The Radio City Suite, 64th Floor, New York, New
York, on July 24, 1997 at 10:00 A.M., local time, and at any
adjournment thereof.
(Continued and to be signed and dated on reverse side)
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS
PROXY WILL BE VOTED FOR THE ELECTION OF ALL NOMINEES FOR DIRECTOR AND
FOR ITEM 2.
1.ELECTION OF DIRECTORS Marne Obernauer, Jr., Robert S. Blank,
John W. Dinzole, William G. Gisel,
Thomas J. Harrington, Marne Obernauer, and
Edward L. Palmer.
FOR all nominees WITHHOLD
listed(except as AUTHORITY
marked to the to vote for all nominees Instruction: To
contrary to the right) listed at right withhold authority to
vote for any individual
nominee write that
nominee's name
on the space provided below
2.Ratification of the selection of KPMG Peat Marwick LLP 3.Upon such other
as auditors for the fiscal business as may
year ending March 31, 1998 properly come
before the meeting.
For Against Abstain
Please sign exactly as name appears
hereon. When shares are held by
joint tenants, both should sign.
When signing as attorney, executor,
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.
Dated: , 1997
Signature
Signature if held jointly
PLEASE MARK, SIGN, DATE, AND RETURN THE PROXY CARD PROMPTLY USING THE
ENCLOSED ENVELOPE.
