<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
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 Rule 14a-11(c) or Rule 14a-12
GENERAL HOST
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
GENERAL HOST
- - --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
- - --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- - --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
- - --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- - --------------------------------------------------------------------------------
(5) Total fee paid:
- - --------------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
- - --------------------------------------------------------------------------------
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid:
- - --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
- - --------------------------------------------------------------------------------
(3) Filing party:
- - --------------------------------------------------------------------------------
(4) Date filed:
- - --------------------------------------------------------------------------------
<PAGE> 2
- - --------------------------------------------------------------------------------
[LOGO]
NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
AND
PROXY STATEMENT
MAY 18, 1995
9:00 A.M. LOCAL TIME
AT
THE STOUFFER RENAISSANCE DAYTON HOTEL
FIFTH & JEFFERSON STREETS
DAYTON, OHIO 45402
- - --------------------------------------------------------------------------------
<PAGE> 3
[LOGO]
METRO CENTER, ONE STATION PLACE, STAMFORD, CONNECTICUT
------------------------
NOTICE OF ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD
MAY 18, 1995
TO THE SHAREHOLDERS OF GENERAL HOST CORPORATION:
Notice is hereby given that the Annual Meeting of Shareholders of GENERAL HOST
CORPORATION will be held at the Stouffer Renaissance Dayton Hotel, Fifth &
Jefferson Streets, Dayton, Ohio 45402, on Thursday, May 18, 1995, at 9:00 A.M.,
local time, for the following purposes:
(1) To elect one director to hold office until the 1997 Annual Meeting
of Shareholders;
(2) To elect three directors to hold office until the 1998 Annual
Meeting of Shareholders;
(3) To ratify the appointment of Price Waterhouse LLP as independent
accountants for the year;
(4) To consider and act upon the adoption by the Company of the 1994
Non-Employee Directors Stock Option Plan; and
(5) To transact such other business as may properly come before the
meeting.
Shareholders of record at the close of business on April 3, 1995 will be
entitled to vote at the meeting or any adjournment thereof.
By order of the Board of Directors
HARRIS J. ASHTON,
Chairman of the Board
Stamford, Connecticut
April 13, 1995
EACH SHAREHOLDER IS URGED TO EXECUTE AND RETURN THE ENCLOSED PROXY PROMPTLY. IF
A SHAREHOLDER DECIDES TO ATTEND THE MEETING, HE MAY, IF HE DESIRES, REVOKE HIS
PROXY AND VOTE HIS SHARES IN PERSON.
<PAGE> 4
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
MAY 18, 1995
This Proxy Statement is furnished to the shareholders of General Host
Corporation (hereinafter referred to as the "Company" or "General Host") in
connection with the solicitation of proxies by or on behalf of the Board of
Directors to be voted at the Annual Meeting of Shareholders of the Company to be
held on Thursday, May 18, 1995.
The mailing address of the principal executive office of the Company is
Metro Center, One Station Place, P.O. Box 10045, Stamford, Connecticut 06904.
The approximate date on which the Proxy Statement and form of proxy are first
being sent or given to shareholders is April 13, 1995.
Proxies delivered pursuant to this solicitation are revocable at the option
of the persons who have executed them at any time prior to the exercise thereof.
All properly executed proxies delivered pursuant to this solicitation, unless
previously revoked, will be voted in accordance with directions given, if
delivered in time to be voted at the meeting.
INFORMATION CONCERNING GENERAL HOST SECURITIES
VOTING RIGHTS
Only shareholders of record at the close of business on April 3, 1995, will
be entitled to vote at the Annual Meeting or any adjournment thereof.
On March 15, 1995, there were outstanding 21,085,922 shares of Common Stock
of the Company, which are the only voting securities outstanding. Except with
respect to the election of directors discussed below, each of these shares will
be entitled to one vote at the Annual Meeting as are any additional shares which
were issued prior to the close of business on April 3, 1995.
The Company's directors are divided into three classes. Shareholders have
cumulative voting rights in electing directors, and each shareholder has the
number of votes equal to the number of shares owned by him multiplied by the
number of directors to be elected in each class. Shareholders may cast all of
their votes for a single nominee within a class or distribute them among
nominees in such class in any manner they desire. Proxies solicited may be
cumulatively voted to the extent that discretionary authority granted to proxy
holders permits them to do so.
COMMON STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, to the best knowledge of the Company,
information as to the beneficial ownership of (i) owners of more than 5% of the
Common Stock of the Company; (ii) each director; (iii) the executive officers
(other than directors) named in the Summary Compensation Table beginning on page
8; and (iv) all directors and executive officers, as a group, of the Company's
Common Stock. Unless otherwise noted, all information is shown as of March 15,
1995 and includes the number of shares beneficially owned by each director or
executive officer determined under the rules of the Securities and Exchange
Commission (the "Commission"), and the information is not necessarily indicative
of beneficial ownership for any other purpose.
2
<PAGE> 5
<TABLE>
<CAPTION>
SHARES OF
GENERAL HOST
COMMON STOCK
----------------------
AMOUNT PERCENT
BENEFICIALLY OF
BENEFICIAL OWNERS OWNED(1)(2) CLASS
------------------------------------------------- ----------- -------
<S> <C> <C> <C>
(i) Holders Other Than Directors
FMR Corp.
82 Devonshire Street
Boston, Massachusetts 02109.................... 2,274,118(3) 9.8
Fisher Investments, Inc.
13100 Skyline Blvd.
Woodside, CA 94062............................. 1,061,225(4) 5.0
Gabelli Funds, Inc.
One Corporate Center
Rye, NY 10580-1434............................. 3,454,841(5) 15.3
Pier 1 Imports, Inc.
301 Commerce Street, Ste 600
Fort Worth, Texas 76102.......................... 2,037,000(6) 9.7
(ii) Directors
Harris J. Ashton................................. 1,963,435(7) 9.1
C. Whitcomb Alden, Jr. .......................... 400,819(8) 1.9
Christopher A. Forster........................... 14,809 *
S. Joseph Fortunato.............................. 25,200 *
Philip B. Harley................................. 134,000 *
Richard W. Haskel................................ 7,684 *
Edward H. Hoornstra.............................. 315,495(9) 1.5
Charles B. Johnson............................... 33,333 *
Kelly Ashton Sant Albano......................... 81,353(10) *
(iii) Executive Officers Other Than Directors
Robert M. Lovejoy................................ 53,925 *
James R. Simpson................................. 36,674 *
Scott A. Hessler................................. 26,262 *
William C. Boyd.................................. 47,792 *
(iv) All Directors And Executive Officers As a Group
(13 persons)..................................... 3,140,781 14.4%
</TABLE>
- - -------------------------
* Represents holdings of less than one percent.
(1) Includes the following numbers of shares of Common Stock held as of
December 31, 1994 by the trustee of the General Host Corporation Profit
Sharing and Savings Plan for the benefit of the following persons: Mr.
Ashton, 40,045; Mr. Lovejoy, 3,302; Mr. Simpson, 1,560; Mr. Boyd, 3,293;
and all directors and executive officers as a group, 48,200.
(2) Includes the following shares of Common Stock subject to options
outstanding and exercisable on or within 60 days after March 15, 1995: Mr.
Ashton, 540,000; Mr. Fortunato, 15,000; Mr. Hessler, 20,000; Mr. Lovejoy,
31,500; Mr. Simpson, 19,500; Mr. Boyd, 34,000; and all directors and
executive officers as a group, 660,000.
(3) Number of shares based on the Schedule 13G dated February 13, 1995, filed
with the Commission by FMR Corp. Of these shares, 2,231,618 would be
receivable by the holders upon conversion of certain convertible debentures
held by them.
(4) Number of shares based on Schedule 13G dated February 14, 1995 filed with
the Commission by Fisher Investments, Inc.
3
<PAGE> 6
(5) Number of shares based on Amendment No. 9 to the Schedule 13D dated
November 16, 1994, filed with the Commission by Gabelli Funds, Inc. and
GAMCO Investors, Inc. Of these shares, 1,522,287 would be receivable by the
holders upon conversion of General Host's convertible debentures held by
them.
(6) Number of shares based on Amendment No. 2 to the Schedule 13D dated January
4, 1995, filed with the Commission by Pier 1 Imports, Inc.
(7) Includes 21,425 shares of Common Stock directly owned and 10,121 shares
beneficially owned by Mr. Ashton's wife and 31,825 shares of Common Stock
owned by a foundation of which Mr. Ashton is an officer. With respect to
the foregoing, Mr. Ashton disclaims any beneficial ownership.
(8) Includes 369,140 shares of Common Stock, as of January 31, 1995, owned by
one pension trust of which Mr. Alden is trustee, which is maintained by a
subsidiary of the Company.
(9) Includes 28,956 shares of Common Stock as to which Mr. Hoornstra shares
voting and investment power with his wife.
(10) Includes 3,600 shares held as custodian for her son.
ELECTION OF DIRECTORS
Under the Company's Certificate of Incorporation and By-Laws, its directors
are divided into three classes, each class to be elected at successive annual
meetings of shareholders for terms of three years. The three directors whose
terms will expire at the 1995 Annual Meeting of Shareholders are C. Whitcomb
Alden, Jr., Philip B. Harley and Richard W. Haskel. These individuals have been
nominated by the Board of Directors to stand for re-election as directors at the
1995 Annual Meeting to hold office until the 1998 Annual Meeting and until their
successors are duly elected and qualified.
On December 7, 1994, the Board of Directors elected Kelly Ashton Sant
Albano to fill the vacancy created by the death of Weston E. Hamilton. Ms. Sant
Albano is the Board of Director's nominee for election as director to hold
office until the 1997 Annual Meeting and until her successor is elected and
qualified.
Should any one or more of these nominees become unable to accept nomination
or election, which the Board has no reason to believe will be the case, the
persons named in the accompanying form of proxy will vote for the election of
such person or persons as the Board may nominate.
Section 13 of the Company's By-Laws requires that advance notification of
nominations of directors by shareholders be given to the Secretary of the
Company not less than thirty (30) nor more than sixty (60) days prior to the
date of any meeting of shareholders held for the purpose of electing directors,
unless shareholders are given less than thirty-five (35) days notice of such
meeting in which case shareholder nominations would be permissible up to seven
(7) days after notice of the meeting is mailed by the Company. In addition, the
notice of nomination must set forth certain information regarding any nominee
who is not an incumbent director, including his or her name, address and
principal occupation, the number of shares of stock of the Company beneficially
owned by such nominee and the nominating shareholder and any other information
required to be disclosed about nominees in proxy solicitations pursuant to
Schedule 14A under the Securities Exchange Act of 1934 ("Exchange Act") or any
successor rule, and the notice must be accompanied by the written consent of the
proposed nominee to serve as director. Nominations which are determined by the
chairman of the meeting of shareholders not to have been made in accordance with
the procedure established by Section 13 will be disregarded. The foregoing
summary of Section 13 is qualified in its entirety by reference to the complete
text of Section 13.
Based on this provision and the dates of mailing of this Notice and the
Annual Meeting, any nominations by shareholders for directors, together with the
other required information and consents, should be delivered to the Secretary of
the Company by April 18, 1995.
4
<PAGE> 7
INFORMATION ON NOMINEES AND INCUMBENT DIRECTORS
<TABLE>
<CAPTION>
SERVED AS
NAME DIRECTOR SINCE AGE
- - --------------------------------------------------------------------- -------------- ---
<S> <C> <C>
Nominee for Term Expiring 1997
Kelly Ashton Sant Albano............................................. December 1994 30
Nominees for Term Expiring 1998
C. Whitcomb Alden, Jr. .............................................. May 1965 79
Philip B. Harley..................................................... March 1973 76
Richard W. Haskel.................................................... February 1981 61
Incumbent Directors -- Term Expiring 1996
Harris J. Ashton..................................................... May 1965 62
Christopher A. Forster............................................... March 1974 62
S. Joseph Fortunato.................................................. April 1993 62
Incumbent Directors -- Term Expiring 1997
Edward H. Hoornstra.................................................. June 1970 73
Charles B. Johnson................................................... September 1969 62
</TABLE>
Mr. Ashton has been principally employed for more than the past five years
as Chairman of the Board of Directors, President and Chief Executive Officer of
the Company. Mr. Ashton is a director or trustee of numerous Franklin/Templeton
mutual funds. He is also a director of RBC Holdings (USA) Inc., a wholly-owned
subsidiary of The Royal Bank of Canada. Mr. Ashton is the father of Ms. Sant
Albano.
Mr. Alden has been principally engaged during the past five years as a
financial consultant and private investor.
Mr. Forster retired as a Managing Director of Marsh & McLennan,
Incorporated, an insurance broker, on July 1, 1993, a position he held for more
than the past five years.
Mr. Fortunato has been a partner of the law firm of Pitney, Hardin, Kipp &
Szuch for more than the past five years. He is also a director or trustee of
numerous Franklin/Templeton mutual funds.
Mr. Harley, a private investor, retired from the Boards of numerous mutual
funds of the Keystone Group, Inc. on December 31, 1994, positions he held for
more than the past five years.
Mr. Haskel has been President of Haskel Enterprises, Inc., a consulting
company involved in management consulting and acquisitions, and affiliated with
the business brokerage firm of Country Business, Inc., for more than the past
five years.
Mr. Hoornstra has been President of Del-Tem Investment Corporation, a
closely held investment and real estate management company, for more than the
past five years. Mr. Hoornstra was Vice Chairman of the Board of Directors of
the Company and President of its Specialty Retailing Group for more than five
years prior to his retirement in December 1986.
Mr. Johnson has been President and a director of Franklin Resources, Inc.,
a financial holding company, and President of Franklin Distributors, Inc., a
mutual fund management company, for more than the past five years. He is also
President and a trustee of Franklin Tax-Free Trust, and a director or trustee of
numerous Franklin/Templeton mutual funds.
5
<PAGE> 8
Ms. Sant Albano received a B.A. degree from Yale University and an M.B.A.
degree from Harvard Business School. She has completed the Macy's executive
training program and worked in both store-line and management positions at
Macy's from January 1988 to November 1989 and at Bloomingdale's from June 1992
to June 1993.
Each incumbent director attended at least 75% of the aggregate number of
meetings of the Board of Directors and the Committees of the Board of Directors
on which the director served, except for Mr. Johnson who attended 63% of the
aggregate number of meetings.
INFORMATION ON COMMITTEES OF THE BOARD OF DIRECTORS
Executive Committee -- This Committee, which exercises, to the extent
permitted by New York law, all of the powers of the Board of Directors during
the intervals between Board meetings, consists of Harris J. Ashton (Chairman),
Richard W. Haskel and Charles B. Johnson. During fiscal 1994 the Executive
Committee held no meetings.
Audit Committee -- This Committee, which monitors the activities of the
Company's auditors and reports on such activities to the full Board of
Directors, consists of Charles B. Johnson (Chairman), and Richard W. Haskel.
During fiscal 1994, the Audit Committee held two meetings.
Compensation Committee -- This Committee, which approves the compensation
of officers of the Company and has overall responsibility for the Company's
compensation policies, consists of Philip B. Harley (Chairman), C. Whitcomb
Alden, Jr. and Christopher A. Forster. During fiscal 1994, the Compensation
Committee held three meetings.
The Board of Directors has no nominating committee.
COMPENSATION OF DIRECTORS
Each of the non-management directors of the Company received fees of
$30,000 per annum and $750 for each Board of Directors or Committee meeting
attended. During fiscal 1994, there were six meetings of the Board and a total
of five meetings of its Committees. The directors also participate in benefit
programs generally available to Company employees.
Upon reaching age seventy-five or after ten years of service as a director,
whichever occurs earlier, each non-management director becomes eligible to
retire from the Board of Directors and, at the discretion of the Board of
Directors, receive an annual retainer fee equal to the then annual director's
fee being paid on his retirement date for a number of years equal to the number
of years served as a director. In order to be eligible for this retainer, each
director must agree to be available to provide services to the Company on a
basis to be mutually determined by the director and the Executive Committee.
Payment of the retainer is suspended for any director who continues to be
affiliated with the Company in any capacity and receives payment for services
performed for the Company.
During 1994 the Company adopted the 1994 Non-Employee Directors Stock
Option Plan, subject to shareholder approval, and granted an option to each of
the non-employee directors to purchase 25,000 shares of Common Stock at an
exercise price of $4.44 per share (except for Ms. Sant Albano whose exercise
price was $4.81 per share). See "Proposal to Approve 1994 Non-Employee Directors
Stock Option Plan" on page 16 of this Proxy Statement.
6
<PAGE> 9
During the 1992 fiscal year, Mr. Alden exercised an option for 15,000
shares and elected to defer the purchase price of the option, as provided by the
terms of the Company's Directors' Stock Option Plan then in effect. Mr. Alden
executed a promissory note in the amount of $109,650 due five years from the
date of execution with interest at the rate of six percent per annum. Mr. Alden
also elected to borrow from the Company, on the same terms as noted herein, an
amount equal to his tax liability as a result of the exercise, as provided by
this Plan. The largest aggregate amount outstanding with regard to Mr. Alden's
indebtedness to the Company during fiscal year 1994 was $123,650. As of March
15, 1995 the amount of indebtedness outstanding under Mr. Alden's notes was
$123,650.
During the last fiscal year Mr. Alden served as Trustee of a pension trust
maintained by the Company and one of its subsidiaries. Mr. Alden received a
total of $27,000 in 1994 in compensation from this trust for serving in this
capacity.
DIRECTORS AND OFFICERS' LIABILITY INSURANCE POLICY
The Company maintains $17.5 million of insurance providing payment either
to the Company for indemnification given its directors or officers, or directly
to its directors and officers, for certain liabilities which the Company's
directors and officers may incur in their respective capacities. This insurance
policy, which is currently dated April 1, 1995, is provided by National Union
Fire Insurance Company. The premium paid in fiscal 1994 was $280,000.
7
<PAGE> 10
EXECUTIVE COMPENSATION
Shown below is information concerning the compensation for services
rendered in all capacities to the Company for the fiscal years ended January 31,
1993 (fiscal year 1992), January 30, 1994 (fiscal year 1993) and January 29,
1995 (fiscal year 1994) for those persons who were, at January 29, 1995, (i) the
chief executive officer and (ii) the other four most highly compensated
executive officers of the Company (the CEO and the four most highly compensated
officers will be referred to collectively as the "Named Officers"). Mr. Ashton
served as CEO for the entire year, Mr. Hessler became President and COO of the
Company's subsidiary, Frank's Nursery & Crafts, Inc. ("Frank's"), on May 23,
1994 and no other individuals served as executive officers during fiscal year
1994 for whom disclosure must be provided.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
-----------------------------------
ANNUAL AWARDS PAYOUTS
COMPENSATION ----------------------- --------
NAME ---------------------------------- SECURITIES
AND OTHER RESTRICTED UNDERLYING ALL
PRINCIPAL ANNUAL STOCK OPTIONS/ LTIP OTHER
POSITION YEAR SALARY BONUS(1) COMPENSATION AWARDS(2) SARS PAYOUTS COMPENSATION(3)
- - ---------------------------- ---- -------- -------- ------------ ---------- ---------- -------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Harris J. Ashton, 1994 $754,890 $260,000 $ 28,725 -0- -0- 446,869 $ 101,430(4)
Chairman of the Board, 1993 754,890 -0- -0- -0- 145,658
President and CEO 1992 721,707 103,000 -0- 300,000 $ 97,354
Robert M. Lovejoy, 1994 182,774 50,000 -- $6,375 -0- -0- 1,730
Vice President and 1993 182,774 -0- -- -0- 7,500 -0- -0-
Treasurer 1992 182,774 35,000 -- -0- 2,000 -0- -0-
James R. Simpson, 1994 166,774 50,000 -- 6,375 -0- -0- 1,570
Vice President and 1993 164,370 -0- -- -0- 7,500 -0- -0-
Controller 1992 159,250 30,400 -- -0- 2,000 -0- -0-
Scott A. Hessler, 1994 211,933 80,000 160,187(5) -0- 100,000 -0- -0-
President & COO --
Frank's
William C. Boyd, 1994 163,000 10,000 -- 6,375 -0- -0- 1,630
Executive Vice President 1993 161,096 -0- -- -0- 10,000 -0- -0-
-- Frank's 1992 154,904 30,000 -- -0- 2,000 -0- -0-
</TABLE>
- - -------------------------
(1) Amounts included under the Company's or Frank's Executive Compensation Plan
for services rendered in the respective fiscal years.
(2) The aggregate number of shares of restricted stock held at January 29, 1995
and the market value of such shares on that date (based on the closing price
of $5.00 on the New York Stock Exchange on January 27, 1995) were: Mr.
Lovejoy, 1,000 shares, $5,000; Mr. Simpson, 1,000 shares, $5,000; and Mr.
Boyd, 1,000 shares, $5,000. Dividends are paid to the holders of restricted
stock. These shares will vest January 28, 1996.
(3) Includes contributions for fiscal year 1994 on behalf of the Named Officers
under the Profit Sharing and Savings Plan as follows: Mr. Ashton, $7,549;
Mr. Lovejoy, $1,730; Mr. Simpson, $1,570; and Mr. Boyd, $1,630.
(4) Of this amount, $2,991 represents the portion of the premiums paid by the
Company during fiscal year 1994 on the life insurance policies described on
page 15 of this Proxy Statement that was deemed to purchase term protection
and $90,890 represents the value of the benefit to Mr. Ashton, projected on
an actuarial basis based on the life expectancy of Mr. and Mrs. Ashton, of
the remainder of such premiums.
(5) Of this amount, $160,090 represents relocation expenses paid to or on behalf
of Mr. Hessler.
8
<PAGE> 11
The table below reflects information regarding grants of stock options
pursuant to the Amended and Restated 1986 Stock Incentive Plan during the fiscal
year ended January 29, 1995 to the Named Officers.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
- - ---------------------------------------------------------------------------------------- ANNUAL RATES OF
NUMBER OF % OF TOTAL STOCK PRICE
SECURITIES OPTIONS/SARS APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OR OPTION TERM
OPTIONS/SARS EMPLOYEES IN BASE PRICE EXPIRATION --------------------
NAME GRANTED(1)(2) FISCAL 1994 (PER SHARE) DATE 5% 10%
- - --------------------------- ------------ ------------ ------------ ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Scott A. Hessler........... 100,000 76.3% 5.75 5/23/99 $158,860 $351,040
</TABLE>
- - -------------------------
(1) Shares may be paid for by delivery of a five-year, interest-only promissory
note at an interest rate determined by the Administrator of this Plan.
Principal is paid in a balloon payment at the end of five years from the
date of exercise. Upon exercise of an option, the Administrator may, in lieu
of delivering shares, make an appreciation distribution in cash equal to the
difference between the option price and the fair market value of the stock
times the number of shares for which the option is exercised on the date
notice of exercise is received. The Administrator may authorize a tax loan
in an amount equal to the Federal, state and local taxes that may be due as
a result of the option or SAR exercise. If a change of control (as defined
in this Plan) occurs prior to the date the options become exercisable, the
options become exercisable within thirty days unless otherwise directed by a
majority of the Board of Directors.
(2) The option was granted at market value on the date of grant, was immediately
exercisable as to 20% of the shares, will become exercisable as to an
additional 20% of the shares on each anniversary of the date of grant and
has a five-year term.
9
<PAGE> 12
Shown below is information with respect to the unexercised options and/or
SARs to purchase the Company's Common Stock granted in fiscal 1994 and prior
years under the Amended and Restated 1986 Stock Incentive Plan, the 1986 Stock
Incentive Plan and the 1981 Stock Option Award Plan to the Named Officers and
held by them at January 29, 1995.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
SECURITIES UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
SHARES ACQUIRED VALUE OPTIONS/SARS AT OPTIONS/SARS AT
NAME ON EXERCISE REALIZED FISCAL YEAR-END FISCAL YEAR-END(2)
- - ---------------------------- --------------- -------- ------------------------------- -------------------
EXERCISABLE(1) UNEXERCISABLE
-------------- -------------
<S> <C> <C> <C> <C> <C>
Harris J. Ashton............ -- -- 540,000 -- -0-
Robert M. Lovejoy........... -- -- 31,500 -- -0-
James R. Simpson............ -- -- 19,500 -- -0-
Scott A. Hessler............ -- -- 20,000 80,000 -0-
William C. Boyd............. -- -- 34,000 -- -0-
</TABLE>
- - -------------------------
(1) All of these options are deemed exercisable; however, Messrs. Lovejoy and
Simpson each hold options for 7,500 shares and Mr. Boyd holds options for
10,000 shares, which options may be exercised only after the closing price
of the Company's Common Stock reaches $14.00 per share and such closing
price remains at or above $14.00 per share for ten consecutive business
days.
(2) Based on the closing price on the New York Stock Exchange -- Composite
Transactions, of the Company's Common Stock on January 27, 1995 ($5.00).
RETIREMENT BENEFIT
Mr. Ashton is entitled to a retirement benefit under the terms of his
employment contract to commence on January 1, 1998, when he will have become 65,
or upon his earlier termination of employment. The retirement benefit is
determined on a life annuity basis, using the 1971 Group Annuity Table, in the
form of a monthly benefit (payable for life) equal to 3% of his average monthly
cash salary during the last thirty-six months of his employment multiplied by
the number of years of his service to the Company. Mr. Ashton has been employed
by the Company for twenty-nine years and ten months and his average monthly cash
salary during the last three fiscal years was $61,980. Under his contract, Mr.
Ashton is entitled to receive a lump sum payment at the time his retirement
benefit is due to commence. Such lump sum payment is to be equal to (i) the
then-discounted present value, determined by using a discount rate of six
percent per year, of the retirement benefit less (ii) $3,442,302, plus an
interest factor, representing amounts previously paid on account of such
retirement benefit.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee is responsible for guiding the Company and
Frank's Nursery & Crafts, Inc., the Company's wholly owned operating subsidiary
("Frank's"), in the development and implementation of various policies, plans
and programs. The Committee approves the salary levels of Mr. Ashton (the
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<PAGE> 13
"CEO") and Messrs. Lovejoy, Simpson, Hessler and Boyd (for purposes of this
Compensation Committee Report, Messrs. Lovejoy, Simpson, Hessler and Boyd shall
be referred to as the "named executives"). The Committee approves, on an annual
basis, the terms of the General Host Executive Compensation Program (the
"Program"), the option awards under the Amended and Restated General Host
Corporation 1986 Stock Incentive Plan (the "Plan") and the terms of the Frank's
Executive Compensation Program (the "Frank's Program").
The intended purposes of the Program, the Plan and the Frank's Program are
to: (a) promote the interests of the Company and its shareholders by attracting
and retaining officers and other key employees of exceptional ability; (b)
maximize the Company's long-term success and investment return to shareholders;
(c) provide officers and key employees important to the Company's sustained
growth with a proprietary interest and greater incentive to contribute to the
success of the Company through ownership of Company shares; and (d) provide
long-term incentive opportunities for officers and other key employees which are
competitive with those offered by other corporations in the business and
geographic areas the Company operates.
The Committee has the power to waive performance or profitability criteria
when awarding salary increases or when granting bonuses under the Program and
the Frank's Program, but did not do so in 1994, except in the case of one named
executive who received a bonus even though certain objectives were not met.
The Committee has enacted a policy whereby officers of the Company and
Frank's who serve in the capacity of Vice President or above are required to
achieve a minimum ownership target of Company stock within five (5) years from
initial participation, which is January 20, 1994 for executive officers other
than Mr. Hessler and May 23, 1994 for Mr. Hessler. The target for the CEO and
Mr. Hessler is three (3) times salary. The target for the other named executives
except Mr. Boyd is one (1) times salary. The target for Mr. Boyd is two (2)
times salary.
SALARIES
Salaries are established at levels necessary to attract and retain talented
corporate officers and other key employees. Salary increases for corporate
officers depend on the Company's performance in the prior fiscal year as well as
achievement of individual non-financial objectives and overall personal
performance. The non-financial objectives reviewed by the Committee in the
evaluation of these salary increases are typically the same non-financial
objectives that are considered for bonus awards, which are discussed below.
There is no pre-determined weight that is given to the achievement of
non-financial objectives when consideration is given to a salary increase.
The named executives, as a group, received no salary increases in 1994 due
to a salary freeze initiated in December, 1993. Although the Committee
eliminated the salary freeze in February 1995, the named executives' salaries
have not yet been increased.
BONUSES
The Program provides that the executive officers of the Company are
eligible to receive bonus payments based on the achievement of corporate profit
objectives and specific individual objectives. The profit objectives contained
in the Program are based on net income per share of the Company for the fiscal
year, as established by the Committee at the beginning of each fiscal year. The
individual, or non-financial objectives, consist of four or five major goals
that are individually tailored to each function performed by the named
executives and
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incorporate the contribution of that individual's department into the overall
objectives of the Company. With respect to bonus awards, these individual
objectives can account for as much as 50% of total objective achievement, when
combined with Company financial objectives. At the discretion of the Company,
bonuses paid under the Program may be paid in Common Stock of the Company.
The total bonus payment for Mr. Hessler, as president of an operating
Company, may not exceed 60% of base salary, while the total bonus payments for
each of the other named executives may not exceed 48% of base salary. Certain
restrictions on payments exist if the Company does not pay dividends (cash or
stock) on its Common Stock or if the Company would report a loss for the fiscal
year in question due to the payment of a bonus. If profit targets are not
attained, a reasonable and appropriate bonus may be awarded to an individual
whose performance was otherwise outstanding.
Pursuant to the terms of the Frank's Program, certain executive officers of
Frank's and other selected management of Frank's are eligible to receive bonuses
ranging from 3% to 48% of their base salaries based on achieving predetermined
levels of operating income and on specific individual objectives as
predetermined by the individual's immediate superior. The Committee approves the
Frank's Program and the operating income levels at the beginning of each fiscal
year. The Frank's Program contains the same restrictions and features as the
Program. Furthermore, at the discretion of the Company, bonuses paid under the
Frank's Program may be paid in Common Stock of the Company.
OPTIONS AND RESTRICTED STOCK
Options are granted under the Plan to executive officers based on the
following considerations by the Committee: (a) the position and responsibilities
of the person being considered; (b) the nature of the services and the
accomplishments of each individual; (c) the value to the Company of the
services; (d) the individual's present and potential contributions to the
success of the Company; and (e) such other factors as the Committee deems
relevant to accomplishing the purposes of the Plan including the value of
options currently held by the individual. The purchase price of Common Stock
covered by an option shall not be less than the fair market value of the Common
Stock on the day the option is granted. Payment for option shares may be made in
(a) cash, (b) Common Stock, (c) a combination of both, or (d) at the discretion
of the Committee, on a case by case basis, by promissory notes. During fiscal
year 1994 the Committee did not grant any options to the named executives except
for an option to purchase 100,000 shares granted to Mr. Hessler in connection
with his joining the Company in May 1994.
In January 1994, the Committee adopted a proposal to award Restricted Stock
to all employees affected by the December 1993 wage freeze on condition that the
1994 budgeted profitability objective set by the Committee in connection with
the Program is met. During fiscal year 1994 each of the named executives who
were affected by the salary freeze received 1,000 shares of Restricted Stock.
Since the profitability objective was met, the named executives have retained
these awards. The Restricted Stock will vest on January 28, 1996.
CEO COMPENSATION
The CEO is subject to an employment contract, effective January 1, 1992,
that expires on December 31, 1997. The terms of the employment contract are set
forth beginning on page 14 of this Proxy Statement.
In 1994, the CEO's salary was frozen in accordance with the terms of the
above-mentioned salary freeze notwithstanding the fact that his employment
agreement provided for a salary increase effective January 1,
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<PAGE> 15
1994. With the elimination of the salary freeze in February 1995, the CEO's
salary automatically increased to the rate provided in the contract for 1995.
The Committee develops and measures the CEO's objectives under the Program
in January of each year for the following fiscal year. The CEO is eligible to
receive a bonus payment not to exceed 60% of salary based on the same objectives
mentioned previously relative to the Program. The CEO was awarded a bonus under
the Program for services rendered in fiscal year 1994.
The stock gain award, which is discussed on page 15 of this Proxy
Statement, provides incentive to the CEO to concentrate on taking all necessary
measures to enhance shareholder value. The Committee is willing to reward the
CEO if the shareholders have been rewarded by virtue of a higher stock price.
The CEO did not receive a stock gain award for 1994.
The retirement benefit, which is discussed on page 10 of this Proxy
Statement, was granted to the CEO in recognition of what will be, at the
expiration of the current employment contract, 32 years in senior management,
including 28 years as Chief Executive Officer of the Company.
INTERNAL REVENUE CODE SECTION 162(M)
Internal Revenue Code Section 162(m) generally limits the corporate tax
deduction for compensation paid to certain officers named in this Proxy
Statement to $1 million. Based on past history, it is probable that the
restrictions contained in Section 162(m) will only affect the deductibility of
the CEO's pay. According to Section 162(m), compensation payable pursuant to a
written contract in effect prior to February 17, 1993, which has not been
materially modified after that date, is exempt from the $1 million deduction
limit. The CEO's contract was entered into prior to that date and, therefore,
compensation payable pursuant to the employment contract will be exempt from
Section 162(m) until termination of the contract in 1997 or until the contract
is materially modified.
Philip B. Harley (Chairman)
C. Whitcomb Alden, Jr.
Christopher A. Forster
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PERFORMANCE GRAPH
Set forth below is a line graph comparing the yearly percentage change in
the cumulative total shareholder return on the Company's Common Stock against
the cumulative total return of the S&P Retail Store Composite Index and the S&P
500 Stock Index for the period of five fiscal years commencing January 29, 1990
and ending January 29, 1995.
COMPARISON OF FIVE YEAR TOTAL RETURNS
GENERAL HOST, S&P RETAIL STORES COMPOSITE, S&P 500
<TABLE>
<CAPTION>
S&P RETAIL
MEASUREMENT PERIOD GENERAL HOST STORES COM- S&P 500 IN-
(FISCAL YEAR COVERED) CORPORATION POSITE* DEX**
<S> <C> <C> <C>
1989 100 100 100
1990 108 109 107
1991 154 166 136
1992 190 195 148
1993 139 188 166
1994 110 175 168
</TABLE>
* Source: Standard & Poor's Compustat Services, Inc. 1/28/90=100
** Source: Standard & Poor's Corporation. Years ended January.
EMPLOYMENT CONTRACT AND OTHER ARRANGEMENTS
The Company has an employment contract, effective January 1, 1992, with Mr.
Ashton, pursuant to which he will be employed as Chief Executive Officer of the
Company until December 31, 1997.
The employment contract entitles Mr. Ashton to a minimum base salary of
$718,942, with increases of five percent per year thereafter during the term of
the contract. If Mr. Ashton becomes permanently disabled, dies or his employment
is terminated by the Company during the term of the contract, the Company shall
pay him or his estate his base salary through the date of termination or, in the
event of death or disability, through the end of the month in which the death or
disability occurs, in addition to a lump sum amount equal to the discounted
present value of 50% (100% in the event of termination without cause) of the
base salary he would
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have received through the end of the contract, or if greater, for the
twenty-four months following his termination, death or disability (Mr. Ashton's
final base salary under the contract to be continued for any part of the
twenty-four month period occurring after December 31, 1997). Under the contract,
Mr. Ashton may elect to regard his employment to be terminated without cause in
the event of a change in control (as defined in the contract) of the Company or
a change in any of the material terms and conditions of his employment.
In the event of voluntary termination by Mr. Ashton, he will be entitled to
receive his base salary through the date of termination plus a lump sum payment
in cash equal to the base salary he would have received under the contract for a
period of 12 months following the date of his termination but not beyond the
expiration date of the contract.
Upon expiration of the contract or cessation of Mr. Ashton's employment for
any reason, he will be entitled to receive a retirement benefit as described on
page 10 of this Proxy Statement.
Mr. Ashton is also entitled to receive a stock gain award determined at the
end of each calendar year based on the excess of the average of the weekly
closing prices for the Company's Common Stock for the year over the greater of
(i) $7.50 (representing the average of the weekly closing price for 1991)
increased by 4% each year or (ii) the average of the weekly closing prices for
the last year for which a stock gain award was paid. The excess, if any, is then
multiplied by the product of 2% and the average number of shares outstanding for
the year in question.
On the date the contract was executed, Mr. Ashton was granted options to
purchase 300,000 shares of the Company's Common Stock, pursuant to the terms of
the contract.
During the term of the contract, Mr. Ashton shall be reimbursed for any
medical or dental expenses incurred by him or any members of his immediate
family under age 26 or living at home, to the extent not otherwise paid under
Company programs. Mr. Ashton and his wife are also entitled to fully paid
medical benefits, consistent with those now paid, for the rest of their lives.
Mr. Ashton is entitled under the contract to indemnity consistent with
Section 26 of the By-Laws as such Section presently exists, notwithstanding
subsequent amendments, if any, to such Section.
If any payments to be made to Mr. Ashton under this contract are subject to
an excise tax, the Company shall pay Mr. Ashton an additional amount which,
after income taxes, equals such excise tax.
Under the terms of an agreement made in November 1989 between the Company
and a Trust established for the benefit of Mr. and Mrs. Ashton's beneficiaries,
the Company will pay the premiums for two survivorship life insurance policies
on the lives of Mr. and Mrs. Ashton. Benefits become payable when both have
died, and the Company will have an interest in the death benefits equal to the
amount it has paid for these policy premiums. The Company will continue to make
annual premium payments until the earliest of: (1) the deaths of both Mr. and
Mrs. Ashton; (2) the Company shall have made 12 payments of the full annual cash
premiums; (3) the Company shall have paid an aggregate of $1,500,000 for
premiums; or (4) the premium payment next due after the year in which premiums
may be paid in full from the sum available from dividends or other sums
generated by the policies. The premium payment for these policies for fiscal
1994 was $113,413.
PROFIT SHARING AND SAVINGS PLAN AND LOANS TO EXECUTIVE OFFICERS
The Company currently maintains a Profit Sharing and Savings Plan which
covers salaried and hourly employees of the Company who are 21 years of age,
have one year of service, have worked 1,000 hours in a
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year and are not covered by a collective bargaining agreement. Profit sharing
contributions are determined by the Board of Directors who utilize, as a
guideline, a formula based on the return on equity of the Company. The Board of
Directors authorized a contribution of the Company's Common Stock equivalent in
value to $500,000 for fiscal 1994. The Company does not match employee
contributions.
The Company or Frank's has loaned money to certain key employees for the
purpose of enabling them to purchase shares of the Company's stock or
debentures. These loans are payable in a lump sum five years from the date made
and bear interest at the rate of 6% per annum. The Named Officers, other than
Mr. Ashton, have loans outstanding as of the last day of fiscal 1994 in the
amounts indicated: Robert M. Lovejoy, Jr., $151,614; James R. Simpson, $72,223;
Scott A. Hessler, $37,267 and William C. Boyd, $44,744.
Optionees are permitted, by the terms of their options, to defer payment of
the full amount of the option price for up to five years after the date of
exercise. The interest rate on such loans is currently 6% per annum. Interest is
payable quarterly on the unpaid balance of the deferred purchase price. On
August 22, 1990, Mr. Ashton had outstanding deferred payments on options
totalling $831,250, which were then due the Company. On that date, Frank's made
a loan to Mr. Ashton in the amount of $831,250, the proceeds of which were used
to pay the outstanding deferred payments due the Company. The loan from Frank's
bears interest at the rate of 6% and is payable in full on August 22, 1995. Mr.
Ashton elected to prepay $177,294 of this loan in March 1991 and $25,000 in
February 1992. On March 7, 1991, Mr. Ashton elected to defer the payment of the
purchase price from the exercise of options for 225,000 shares of Common Stock
in the amount of $1,381,253, which is due March 6, 1996. Mr. Ashton elected to
prepay $25,000 of this loan in March 1993. On December 30, 1992, Mr. Ashton
elected to defer the payment of the purchase price from the exercise of options
for 60,000 shares of Common Stock in the amount of $495,000 which is due
December 29, 1997.
RATIFICATION OF APPOINTMENT OF
INDEPENDENT ACCOUNTANTS
The Board of Directors of the Company has appointed the firm of Price
Waterhouse LLP as its independent accountants for the fiscal year ending January
28, 1996, subject to ratification of its appointment by the Company's
shareholders. Price Waterhouse LLP has been serving the Company and its
subsidiaries for 80 years, and the Company has been advised by that firm that
neither it nor any member thereof has any financial interest, direct or
indirect, in the Company or any of its subsidiaries in any capacity. A
representative of Price Waterhouse LLP is expected to be present at this year's
Annual Meeting of Shareholders, at which time he will be given an opportunity to
make a statement and is expected to be available to respond to appropriate
questions.
Ratification of the appointment of the independent accountants requires the
affirmative vote of a majority of the shares present in person or by proxy and
voting at the meeting. If the shareholders should not ratify the appointment of
Price Waterhouse LLP, the Board of Directors will reconsider the appointment.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR RATIFICATION
OF APPOINTMENT OF THE INDEPENDENT ACCOUNTANTS.
PROPOSAL TO APPROVE 1994 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
On October 12, 1994, the Board of Directors adopted, subject to shareholder
approval, a new plan for "outside" directors of the Company designated as the
1994 Non-Employee Directors Stock Option Plan (the "1994 Option Plan"). The
purposes of the 1994 Option Plan are to assist the Company in attracting and
retaining individuals of exceptional ability to serve as directors and to more
closely align their interests with
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those of the shareholders, through one-time grants of options to purchase Common
Stock. The initial grants of options under the 1994 Option Plan were made to all
then-incumbent non-employee directors on October 14, 1994, contingent upon
shareholder approval of the 1994 Option Plan.
The text of the 1994 Option Plan as currently in effect is set forth in
full in the Appendix to this Proxy Statement. The discussion that follows, which
summarizes certain significant features of the 1994 Option Plan and provides
certain other information relevant to consideration of the proposal to approve
the 1994 Option Plan, is qualified in its entirety by reference to the Appendix.
Shareholders are urged to review the complete Appendix as they deliberate upon
this proposal.
SHARES SUBJECT TO OPTION; PLAN LIMITS; ELIGIBILITY
Subject to the plan's limits on available shares, the 1994 Option Plan
contemplates a single grant to each non-employee director (as therein defined)
of an option to purchase 25,000 shares of Common Stock on the terms and at the
times specified in the 1994 Option Plan. Subject to anti-dilution and similar
adjustments as contemplated by Section 8 of the 1994 Option Plan, the aggregate
maximum number of shares that may be used for settlement of options is 300,000
shares, which may be either newly-issued or treasury shares. If at any time the
aggregate maximum number of shares then available for options is insufficient
for the contemplated grants, no options shall be granted. If an option expires
or is terminated or cancelled without having been exercised in full, the shares
subject to the option immediately prior to the expiration, termination, or
cancellation would become available for other options.
Under the terms of the 1994 Option Plan, no one other than a non-employee
director may be granted an option thereunder. For purposes of the 1994 Option
Plan, a "non-employee director" is any individual who at the time of grant of a
plan option is a member of the Board of Directors and is not an officer or
employee of the Company or any subsidiary; prior employment in such a capacity
is not a disqualification.
GENERAL OPTION TERMS
Each option granted under the 1994 Option Plan must have a per share
exercise price equal to the Fair Market Value of a share of Common Stock on the
grant date. As defined in the 1994 Option Plan, while the principal market for
the Common Stock continues to be the New York Stock Exchange ("NYSE"), "Fair
Market Value" for any given date is the average of high and low sale prices for
a share of Common Stock on the NYSE as of that date (or the most recent
preceding date, if no Common Stock traded on the NYSE on the date in question).
On March 10, 1995 the NYSE high and low per share prices for the Common Stock
were $6.125 and $5.875, respectively.
Each option is required by the 1994 Option Plan to be divided into five
tranches, with each tranche relating to 20% of the shares subject to the option.
The five tranches ordinarily first become exercisable in series on the first
through fifth anniversaries, and expire in series on the fifth through ninth
anniversaries, of the date of grant. However, upon the death of the grantee of
an option, or upon a "change in control" of the Company (as defined in Section 9
of the 1994 Option Plan), all outstanding but theretofore unexercisable tranches
automatically become immediately exercisable.
During the lifetime of an option grantee, only the grantee may exercise the
option. If the grantee ceases to serve as a director, the option would continue
to be exercisable only for 90 days thereafter, whereupon it would terminate,
except that, upon the optionee's death, each tranche of the optionee's
then-outstanding option would continue to be exercisable until the earlier of
the first anniversary of the optionee's death or the normal expiration date for
that tranche.
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Payment in full for any exercised option must be made at the time of
exercise for the number of shares for which it is then being exercised. If
authorized by the "Administrator" (generally, the Board of Directors or such
Board committee as it may designate; currently, a committee consisting of three
directors), payment may be made in whole or in part by delivery of a promissory
note evidencing a Company loan made pursuant to Section 7 of the 1994 Option
Plan (discussed below) and all collateral and/or security documents (if any)
required by the Administrator in connection with such loan. Otherwise, payment
may be made only in cash or by delivery of shares of Common Stock, valued at
their Fair Market Value as of the date immediately preceding the delivery date.
FINANCING
Under Section 7 of the 1994 Option Plan, in connection with the exercise of
any option tranche by an optionee then still a director of the Company, the
Administrator, in its discretion, may approve and authorize a Company loan to
the optionee to finance some or all of the aggregate exercise price payable
and/or income taxes incurred by the optionee in connection with such exercise.
Any loan so approved must have a term of no more than five years. The interest
rate payable on any such loan and whether any security for repayment will be
required would be at the discretion of the Administrator.
TIMING OF GRANTS; CONTINGENT GRANTS PREVIOUSLY MADE
Each grant of an option to a non-employee director occurs automatically on
a date specified in the 1994 Option Plan. For any person first becoming a
non-employee director after October 14, 1994, the specified grant date is the
date on which he or she becomes a director except that a grant to a director not
yet elected by the shareholders is conditioned upon election of that director at
the next annual meeting of shareholders. For the eight individuals who were
non-employee directors on October 14, 1994 (i.e., Messrs. Alden, Harley, Haskel,
Forster, Fortunato, Hoornstra, Hamilton and Johnson), that date was the
specified grant date. Ms. Sant Albano's grant date was December 8, 1994.
Accordingly, on October 14, 1995 (but contingent on subsequent shareholder
approval of the 1994 Option Plan), options covering an aggregate 200,000 shares
of Common Stock (25,000 shares per option) were granted to the then-incumbent
non-employee directors on the terms described above and on December 8, 1994 (but
contingent on her election by the shareholders and subsequent shareholder
approval of the 1994 Option Plan), options covering 25,000 shares of Common
Stock were granted to Ms. Sant Albano on the terms described above. The per
share exercise price for each such option other than Ms. Sant Albano's is $4.44
and the per share exercise price for Ms. Sant Albano's option is $4.81 (the Fair
Market Values of a share of Common Stock on the respective grant dates). Upon
Mr. Hamilton's death on November 12, 1994, the exercisability of his option was
accelerated, again contingent upon shareholder approval of the plan. To the
extent not theretofore exercised, Mr. Hamilton's option will terminate on the
first anniversary of his death.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
In general, under Federal income tax law as currently in effect, the grant
of a compensatory stock option to a party such as a director is not a taxable
event for the grantee or a deductible event for the grantor. However, if the
option is a so-called "nonqualified option" (as all options under the 1994
Option Plan will be), upon the exercise of the option the grantee would realize
ordinary compensation income, generally in an amount equal to the difference
between the aggregate fair market value of the shares being acquired and the
aggregate exercise price paid. In addition, under current Federal income tax
law, at the time the grantee realizes such income, the grantor would become
entitled to a compensation expense deduction in the same
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amount, subject to the normal Internal Revenue Code requirements concerning the
reasonableness of compensation and, where applicable, the special limits of
sec.162(m) of the Code upon the deduction of compensation paid to executives
named in the grantor's summary compensation table. Since all recipients of
options granted under the 1994 Option Plan must be non-employee directors and
since effectiveness of the plan is subject to shareholder approval, the Company
believes that Section 162(m) will not impose any limits upon its ability to
deduct compensation expenses resulting from the exercise of options.
AMENDMENT AND TERMINATION
Assuming the 1994 Option Plan is approved by the shareholders, the Board of
Directors thereafter may amend, modify, suspend, or terminate it at any time,
generally without further shareholder approval. However, certain provisions of
the Plan described in Rule 16b-3(c)(ii)(A) under the Exchange Act shall not be
amended more than once every six months other than to comport with changes in
the Code, the Employee Retirement Income Security Act, or the rules thereunder.
Also, no amendment or modification will be effective without shareholder
approval at any time at which such approval is required by the applicable rules
of the NYSE (or any other securities exchange on which the Common Stock is then
principally traded) or by Rule 16b-3 under the Exchange Act as then applicable
to the Company. No such action taken by the Board may adversely affect any
then-outstanding plan option without the holder's consent.
VOTE REQUIRED FOR APPROVAL; RECOMMENDATION
Approval of the 1994 Option Plan requires the affirmative vote of the
holders of a majority of all outstanding shares of Common Stock entitled to vote
at the Annual Meeting. Thus, if for any reason (including abstention or broker
non-vote) any such shares are not voted "FOR" the proposal to approve the 1994
Option Plan, this will have the same effect as a vote "AGAINST" the proposal. If
the proposal is not carried, the 1994 Option Plan (and each of the options
already granted thereunder) will become void and of no effect.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE 1994 OPTION
PLAN.
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GENERAL
Shareholders' proposals intended to be presented at the 1996 Annual Meeting
of Shareholders must be received by the Company for inclusion in its proxy
statement and form of proxy relating to that meeting by December 14, 1995.
Reference is also made to Section 13 of the Company's By-Laws regarding
nomination of directors as discussed on page 4 of this Proxy Statement.
All expenses in connection with the solicitation of proxies will be borne
by the Company. The Company has retained Kissel-Blake Inc. to assist in the
solicitation of proxies, for which such firm will receive aggregate fees of
approximately $10,500, plus reasonable out-of-pocket expenses. In addition, the
Company intends to request brokerage houses, custodians, nominees and others who
hold stock in their names to solicit proxies from the beneficial owners of such
stock, pursuant to the rules of the New York Stock Exchange and the Pacific
Stock Exchange, upon which the Company's Common Stock is listed. The Company
will reimburse such brokerage houses, custodians, nominees and others for their
out-of-pocket expenses, including reasonable clerical expenses, if any. Proxies
may also be solicited by mail, personal solicitation, telephone or telegraph by
employees of the Company.
While Management knows of no other business to be presented at the Annual
Meeting, it is intended that proxies solicited will be voted on any other
matters that may properly come before the meeting, or any adjournment thereof,
in accordance with the discretion of the proxy holders.
By order of the Board of Directors
HARRIS J. ASHTON,
Chairman of the Board
Stamford, Connecticut
April 13, 1995
-------------------------
The Annual Report to Shareholders for the fiscal year ended January 29,
1995, which includes financial statements, has been mailed to shareholders
together with this Proxy Statement. The Annual Report does not form any part of
the material for the solicitation of proxies.
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APPENDIX
GENERAL HOST CORPORATION
1994 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
SECTION 1. PURPOSES
The purposes of this 1994 Non-Employee Directors Stock Option Plan (the
"Plan") are to assist General Host Corporation (the "Company") in attracting and
retaining individuals of exceptional ability to serve as directors of the
Company and to more closely align their interests with those of the Company's
shareholders, through one-time grants of options to purchase shares of the
Company's common stock, par value $1.00 per share ("Company stock").
SECTION 2. AVAILABLE SHARES
Subject to adjustment as provided in Section 8, the aggregate maximum
number of shares of Company stock available for settlement of options granted
under the Plan is 300,000 shares. Shares of Company stock delivered in
settlement of any exercised Plan option may be authorized but theretofore
unissued shares, previously issued shares held in the Company's treasury, or
both. There shall be reserved at all times for issuance under the Plan a number
of shares of Company stock equal to the aggregate maximum number of shares that
may be issued in settlement of options then outstanding and which thereafter may
be granted under the Plan. If a Plan option shall expire or be terminated or
canceled for any reason without having been exercised in full, the shares
subject to the option immediately prior to such expiration, termination, or
cancellation shall become available for other options under the Plan.
SECTION 3. ELIGIBILITY
The only persons who shall be granted options under the Plan are those
individuals who at time of grant are members of the Board of Directors of the
Company (the "Board") and are not officers or employees of the Company or any
subsidiary (each, a "non-employee director"). No person may be granted more than
one option under the Plan.
SECTION 4. ADMINISTRATION
4.1 The Plan shall be administered by the Board or such Board committee as
the Board hereafter may designate (the "Administrator"). The Administrator shall
have full power and authority to (a) prescribe and amend the forms of option
agreements, notices, and all other documents or instruments required under or
determined by the Administrator to be advisable with respect to the Plan; (b)
establish, revise, suspend, and waive such rules and procedures and appoint such
agents as it deems appropriate for the administration or operation of the Plan;
(c) construe and interpret the Plan, any option agreement, and any other
instrument or document relating to the Plan or a Plan option; (d) decide any
question and settle any dispute which may arise in connection with the Plan or
any Plan option; and (e) make any other determination and take any other action
that the Administrator deems necessary or desirable for the administration or
operation of the Plan. All interpretations, determinations or other decisions of
the Administrator concerning the Plan or any Plan option shall be conclusive and
binding upon all interested parties.
4.2 Notwithstanding the foregoing or any other provision of the Plan to the
contrary, however, it being the intention that all options granted under the
Plan shall satisfy all then applicable criteria for "formula awards" under
Securities and Exchange Commission Rule 16b-3 (or any successor regulation) as
in effect and applicable with respect to plans of the Company at a relevant time
("Rule 16b-3"), the Administrator shall
A-1
<PAGE> 24
have no authority or discretion at any time to make any determination or take
any other action which would cause any Plan option, whether then outstanding or
which thereafter may be granted, to fail to meet such criteria.
4.3 All costs and expenses involved in administering the Plan as provided
for herein, or incident thereto, shall be borne by the Company.
SECTION 5. CERTAIN TERMS OF OPTIONS
5.1 Subject to approval of the Plan by the Company's shareholders (and
subject to adjustment as contemplated by Section 8): (a) as of October 14, 1994,
each individual then serving as a non-employee director automatically shall
receive and be granted an option to purchase 25,000 shares of Company stock and
(b) as of the date on which any new non-employee director first becomes a
Company director, such non-employee director shall receive and be granted an
option to purchase 25,000 shares of Company stock (or such lesser number of
whole shares as is then available for options under the terms of the Plan);
provided, however, that if any new non-employee director first becomes a
non-employee director other than by means of election by the shareholders, then
the grant to such non-employee director shall be subject to the condition that
the director be elected by the shareholders at the next annual meeting of
shareholders. If at any time the aggregate maximum number of shares then
available for Plan options is insufficient for grants as contemplated in clause
(b) of the preceding sentence, then no options shall be granted.
5.2 Each option granted under the Plan shall be evidenced by a written
option agreement in form approved by the Administrator, which agreement shall
identify the option as one granted under the Plan, the optionee, and the date of
grant; provide that in the event of any inconsistency between the Plan and the
agreement the terms of the Plan shall govern; and set forth the number of shares
subject to option, the exercise price per share, and (either expressly or by
reference to the Plan) the other terms and conditions of the option.
5.3 The per share exercise price for each option granted under the Plan
shall be the Fair Market Value of a share of Company stock on the date the
option is granted. For purposes of the Plan, "Fair Market Value" for any given
date means: (a) if Company stock is then listed on one or more national
securities exchanges (including, for this purpose, the National Market of the
National Association of Securities Dealers Automated Quotation System
("NASDAQ")), the average on such date of the highest and lowest sale prices for
a share of Company stock on the principal such exchange (or, if no Company stock
traded on such exchange on such date, the next preceding date on which such
trading occurred); (b) if (a) is then inapplicable but bid and asked prices for
shares of Company stock are quoted through NASDAQ, the average on such date of
the highest bid and lowest asked prices so quoted for a share of Company stock
(or, if no prices for Company stock were quoted on such date, the next preceding
date on which they were quoted); and (c) if both (a) and (b) are inapplicable,
the fair market value of a share of Company stock on the date in question as
determined in good faith by the Board.
5.4 Each option granted under the Plan shall consist of five tranches
(hereinafter referred to as tranches "A," "B," "C," "D," "E"), with each such
tranche relating to 20% of the aggregate number of shares subject to the option.
Except as otherwise hereafter provided in this Section 5.4 or Section 9, each
option tranche shall first be exercisable, in whole or in part, and (to the
extent not earlier exercised or terminated) shall expire, in accordance with the
following schedule:
Tranche A: first exercisable at first anniversary of grant; expiration
on fifth anniversary of grant
Tranche B: first exercisable at second anniversary of grant;
expiration on sixth anniversary of grant
A-2
<PAGE> 25
Tranche C: first exercisable at third anniversary of grant; expiration
on seventh anniversary of grant
Tranche D: first exercisable at fourth anniversary of grant;
expiration on eighth anniversary of grant
Tranche E: first exercisable at fifth anniversary of grant; expiration
on ninth anniversary of grant.
However, upon the death of the grantee of a Plan option, any and all then
outstanding but unexercisable tranches of the option immediately shall become
exercisable.
5.5 During the lifetime of the grantee of a Plan option, the option shall
be exercisable only by such optionee. A Plan option shall be exercisable only
while the optionee continues to serve as a Company director and for the 90 days
following cessation of such service, whereupon the option shall terminate
(except that, upon the death of an optionee, each tranche of the optionee's then
outstanding Plan option shall be exercisable until the earlier of the first
anniversary of the optionee's death and the expiration date of such tranche,
whereupon such tranche shall terminate).
SECTION 6. EXERCISE PROCEDURES AND PAYMENT
Whenever exercisable, any tranche of an option granted under the Plan may
be exercised by delivery to the Secretary of the Company (or any of such other
Company officers or employees as the Administrator from time to time may
designate) of a written notice of exercise in form acceptable to the
Administrator and payment in full of the aggregate exercise price for the number
of shares for which the option is being exercised. Payment may be made in any
one or more of the following forms: (a) cash, (b) shares of Company stock
(valued at their aggregate Fair Market Value for the date immediately preceding
the date of delivery), and (c) if authorized by the Administrator in its
discretion exercised on a case by case basis, a promissory note evidencing a
Company loan pursuant to Section 7 and all collateral and/or security documents
(if any) required by the Administrator in connection with such loan.
SECTION 7. FINANCING
In connection with the exercise of a Plan option tranche by an optionee
then still a director of the Company, the Administrator, in its discretion, may
approve and authorize a loan to the optionee by the Company to finance some or
all of the aggregate exercise price payable and/or income taxes incurred by the
optionee in respect of such exercise; provided, that the aggregate principal
amount of such loan shall not exceed the aggregate Fair Market Value on the loan
date of the number of shares being purchased by such exercise. The debt for any
such loan shall be evidenced by a negotiable promissory note in form prescribed
by the Administrator, shall bear interest at such fixed or floating rate as
shall be specified by the Administrator, shall have a term not in excess of five
years, and shall have such other terms and be subject to such conditions
(including, at the Administrator's discretion, the provision of collateral
security) as the Administrator may determine.
SECTION 8. STOCK ADJUSTMENT AND NUMBER OF SHARES
In the event of a reorganization, recapitalization, stock split, stock
dividend, combination of shares, exchange of shares, merger, consolidation,
rights offering, or any other change in the corporate structure or shares of the
Company, the Board shall, at the time of such event or at a subsequent time,
make such adjustment or adjustments as it deems appropriate in the number and
kind of shares authorized by the Plan and covered by outstanding options;
provided, however, that such adjustments must be in the nature of pro rata
anti-dilution adjustments which provide for the equivalent treatment of all
holders of options, provided
A-3
<PAGE> 26
that the aggregate exercise prices of all unexercised options shall not change.
Without limiting the preceding sentence in any respect, in the event of any
merger, consolidation, or combination of the Company with or into another
corporation (other than a merger, consolidation, or combination in which the
Company is the surviving corporation and which does not result in any
reclassification or change of outstanding Company stock), the Board prior
thereto may in its discretion provide that each holder of an option granted
pursuant to the Plan shall have the right thereafter and during the term of such
option to receive upon exercise of such option, or any portion thereof, for each
share of Company stock as to which the option shall be exercised, the kind and
amount of shares of the surviving or new corporation, cash, securities,
evidences of indebtedness, other property, or any combination thereof, which
would have been received upon such merger, consolidation, or combination by a
party holding one share of Company stock immediately prior to such merger,
consolidation, or combination. In the event of a merger, consolidation or
combination in which the consideration issued with respect to shares of Company
stock is a combination of different types of property, the Board may designate
the property or combination of property to be received upon the exercise of an
option outstanding under the Plan.
SECTION 9. EFFECT OF CHANGE IN CONTROL
In the event of a change in control of the Company, unless otherwise
directed by resolution of the Board adopted by the affirmative votes of a
majority consisting entirely of directors who were directors before the change
in control occurred, all then outstanding but theretofore unexercisable Plan
option tranches shall become exercisable. For purposes of the Plan, "change in
control" means that:
(a) 20% or more of the Company's voting stock has been acquired by any
person (as defined by sec. 3(a)(9) of the Securities Exchange Act of 1934,
as amended) other than directly from the Company;
(b) there has been a merger or equivalent combination in which 49% or
more of the voting stock of the surviving corporation is issued for reasons
other than that the recipients were shareholders of the Company; or
(c) 20% or more of the directors elected by shareholders to the Board
are persons who were not nominated by management in the then most recent
proxy statement of the Company.
SECTION 10. MISCELLANEOUS
10.1 The Board may at any time and from time to time amend, modify,
suspend, or terminate the Plan, with or without the approval of shareholders of
the Company, except that: (a) those provisions of this Plan of the nature
described in Rule 16b-3(c)(ii)(A) shall not be amended more often than once
every six months, other than to comport with changes in the Internal Revenue
Code, the Employee Retirement Income Security Act, or the rules thereunder; (b)
no amendment or modification of the Plan shall be effective without shareholder
approval at any time at which such approval is required, either by the
applicable rules of the New York Stock Exchange or any other securities exchange
on which Company stock is then principally traded, or by Rule 16b-3; and (c)
none of the foregoing actions by the Board shall adversely affect any then
outstanding Plan option without the holder's consent.
10.2 The Plan has been adopted by the Board, subject to shareholder
approval. Options granted under the Plan prior to such approval also shall be
subject to shareholder approval and shall be of no effect unless and until such
approval is obtained.
A-4
<PAGE> 27
10.3 If at any time the Board shall determine, in its discretion, that the
listing, registration or qualification of any shares covered by the Plan upon
any national securities exchange or under any Federal, state, local or foreign
law, or the consent or approval of any governmental regulatory body, is
necessary or desirable as a condition of, or in connection with, the issuance of
shares under the Plan, then, notwithstanding any other provision of the Plan to
the contrary, no shares will be delivered unless and until such listing,
registration, qualification, consent or approval shall have been effected or
obtained, or otherwise provided for, free of any conditions not acceptable to
the Board.
10.4 The holder of any option granted under the Plan shall not have any
rights as a shareholder with respect to any shares subject to the option until
such shares have been issued to him or her upon due exercise of the option.
10.5 The Company shall have the right to require the holder of a Plan
option to make payments in cash or Company stock (valued at Fair Market Value on
the payment date) upon the exercise of the option, in connection with any
obligation of the Company to withhold taxes upon such exercise. Any such
required payment shall be a condition precedent to settlement of such option.
10.6 The Plan and all actions taken under it shall be governed by the laws
of the State of New York.
A-5
<PAGE> 28
- - --------------------------------------------------------------------------------
PROXY
GENERAL HOST CORPORATION--1995 ANNUAL MEETING
THIS PROXY IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS
The undersigned hereby appoints HARRIS J. ASHTON, ROBERT M. LOVEJOY
and JAMES R. SIMPSON and each of them, jointly and severally, proxies,
with full power of substitution, to vote with the same force and
effect as the undersigned, including the right to cumulate votes in
the election of directors for such of the nominees as the proxies in
their discretion may deem appropriate (subject to any limitations on
such authority as may be indicated on the reverse side hereof), at the
Annual Meeting of Shareholders of General Host Corporation, to be held
at the Stouffer Renaissance Dayton Hotel, Fifth and Jefferson Streets,
Dayton, Ohio 45402 on May 18, 1995, at 9:00 A.M., and any adjournment
thereof, upon the matters set forth on the reverse side hereof and
upon such other matters as may properly come before, or incident to
the conduct of, the meeting, all in accordance with the accompanying
notice and proxy statement for said meeting, receipt of which is
hereby acknowledged.
------------------------------
This proxy will be voted "FOR" Proposals 1, 2, 3 and 4 unless
instructions to the contrary are indicated. In addition, this proxy
will be voted in accordance with the judgment of the proxy holders
upon such other matters as may properly come before, or incident to,
the conduct of the meeting.
Should any management nominee become unable to accept nomination or
election, this proxy will be voted for a substitute nominated by the
Board of Directors.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE.)
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
-----------
-----------
- - --------------------------------------------------------------------------------
------------
ACCOUNT NUMBER COMMON
- - --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL OF THE FOLLOWING
PROPOSALS:
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1. Election of Kelly Ashton Sant Albano to hold office until 1997. 3. Ratification of appointment of Price
Waterhouse LLP as independent accountants for
1995.
<S> <C> <C> <C> <C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
0 0 0 0 0
2. Election of the following three Directors to hold office until 1998:
C. Whitcomb Alden, Jr., Philip B. Harley and Richard W. Haskel.
FOR WITHHELD
0 0
(To withhold 4. Adoption by the Company of the 1994
authority to Non-Employee Directors Stock Option Plan.
vote for any
individual
nominee write
that nominee's
name on the
space below.)
FOR AGAINST ABSTAIN
--------------- 0 0 0
</TABLE>
- - --------------------------------------------------------------------------------
------------------------------------------------
------------------------------------------------
Dated
----------------------------------- ,
1995
-----------------------------------
(Signature)
-----------------------------------
(Signature)
The signature on this proxy should
correspond exactly with the name
stenciled
------------------------------------------------
------------------------------------------------
hereon. For joint accounts, each
joint owner should sign. Persons
signing as attorney, executor,
administrator, trustee or guardian
and corporate officers should
PLEASE MARK YOUR CHOICE LIKE
THIS IN BLUE OR BLACK INK.
give their full titles.
- - --------------------------------------------------------------------------------
<PAGE> 29
<TABLE>
<S><C>
/X/ Please mark
your votes
as this
__________________
COMMON
THE BOARD OF DIRECTORS RECOMMENDS A VOTE
FOR ALL OF THE FOLLOWING PROPOSALS:
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of Kelly Ashton Sant Albano to hold / / / / 3. Ratification of appointment / / / / / /
office until 1997. of Price Waterhouse LLP as
independent accountants for
1995.
2. Election of the following three Directors / / / / 4. Adoption by the Company of / / / / / /
to hold office until 1998: C. Whitcomb the 1994 Non-Employee
Alden, Jr., Philip B. Harley and Richard Directors Stock Option
W. Haskel. Plan.
(To withhold authority to vote for any I hereby instruct the Trustee to vote by proxy upon such
individual nominee write that nominee's other matters as may properly come before, or incident
name on the space below.) to, the conduct of the meeting, or any adjournment
thereof.
____________________________________________
Should any management nominee become unable to accept
nomination or election, the Trustee is instructed to vote
by proxy for a substitute nominated by the Board of
Directors.
</TABLE>
Signature(s)_________________________________________________ Date___________
The signature on this card should correspond
exactly with the name stenciled hereon. Persons
signing as attorney, director, administrator,
trustee or guardian and corporate officers should
give their full titles.
CG TRUST COMPANY--TRUSTEE
GENERAL HOST CORPORATION PROFIT SHARING AND SAVINGS PLAN
GENERAL HOST CORPORATION--1995 ANNUAL MEETING
THIS VOTING INSTRUCTION CARD IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS
The undersigned hereby instructs CG Trust Company to vote all the shares of
General Host Corporation Common Stock held on my behalf in the General Host
Corporation Profit Sharing and Savings Plan, at the Annual Meeting of
Shareholders of General Host Corporation, to be held at the Stouffer Renaissance
Dayton Hotel, Fifth and Jefferson Streets, Dayton, Ohio 45402 on May 18, 1995,
at 9:00 A.M., and any adjournment thereof, upon the matters set forth on the
reverse side hereof and upon such other matters as may properly come before, or
incident to the conduct of, the meeting, all in accordance with the accompanying
notice and proxy statement for said meeting, receipt of which is hereby
acknowledged.
(CONTINUED, AND TO BE SIGNED, ON THE REVERSE SIDE)
<PAGE> 30
<TABLE>
<S><C>
/X/ Please mark
your votes
as this
_______________
COMMON
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL
OF THE FOLLOWING PROPOSALS:
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of Kelly Ashton Sant Albano to hold / / / / 3. Ratification of appointment of / / / / / /
office until 1997. Price Waterhouse LLP as independent
accountants for 1995.
2. Election of the following three Directors to / / / / 4. Adoption by the Company of the 1994 / / / / / /
hold office until 1998: C. Whitcomb Alden, Jr., Non-Employee Directors Stock Option Plan.
Philip B. Harley and Richard W. Haskel.
This proxy will be voted "FOR" Proposals 1, 2, 3 and 4 unless
(To withhold authority to vote for any instructions to the contrary are indicated. In addition, this
individual nominee write that nominee's proxy will be voted in accordance with the judgment of the proxy
name on the space below.) holders upon such other matters as may properly come before, or
incident to, the conduct of the meeting. Should any management
________________________________________ nominee become unable to accept nomination or election, this
proxy will be voted for a substitute nominated by the
Board of Directors.
Dated _____________________________________, 1995
_________________________________________________
(Signature)
_________________________________________________
(Signature)
The signature on this proxy should correspond
exactly with the name stenciled hereon. For joint
accounts, each joint owner should sign. Persons
signing as attorney, executor, administrator,
trustee or guardian and corporate officers
should give their full titles.
</TABLE>
PROXY
GENERAL HOST CORPORATION--1995 ANNUAL MEETING
THIS PROXY IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS
The undersigned hereby appoints HARRIS J. ASHTON, ROBERT M. LOVEJOY and JAMES R.
SIMPSON and each of them, jointly and severally, proxies, with full power of
substitution, to vote with the same force and effect as the undersigned,
including the right to cumulate votes in the election of directors for such of
the nominees as the proxies in their discretion may deem appropriate (subject to
any limitations on such authority as may be indicated on the reverse side
hereof), at the Annual Meeting of Shareholders of General Host Corporation, to
be held at the Stouffer Renaissance Dayton Hotel, Fifth and Jefferson Streets,
Dayton, Ohio 45402 on May 18, 1995, at 9:00 A.M., and any adjounment thereof,
upon the matters set forth on the reverse side hereof and upon such other
matters as may properly come before, or incident to the conduct of, the
meeting, all in accordance with the accompanying notice and proxy statement for
said meeting, receipt of which is hereby acknowledged.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE.)
