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
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
HUGHES SUPPLY, INC.
(Name of Registrant as Specified In Its Charter)
Maguire, Voorhis & Wells, P.A., counsel to Registrant
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $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 0-11:1
4) Proposed maximum aggregate value of transaction:
1 Set forth the amount on which the filing fee is calculated and state how it
was determined.
[ ] 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:
________________________________________________
HUGHES SUPPLY, INC.
20 North Orange Avenue
Suite 200
Orlando, Florida 32801
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held May 24, 1994
To the Shareholders:
NOTICE IS HEREBY GIVEN that the Annual Meeting of
Shareholders of Hughes Supply, Inc., a Florida
corporation, will be held at Sun Bank Center, Park
Building, Sun Room, Third Floor, 200 South Orange
Avenue, Orlando, Florida, on Tuesday, May 24, 1994, at
10:00 a.m., local time, for the following purposes:
1. To elect 5 of the 10 directors of the Company;
2. To amend the Directors' Stock Option Plan;
3. To approve the stock award provisions of the
Senior Executives' Long-Term Incentive Bonus Plan
for Fiscal Year 1996;
4. To amend the Articles of Incorporation to
increase the number of authorized shares of common
stock; and,
5. To transact such other business as may properly
come before the meeting or any adjournment
thereof.
The Board of Directors has fixed the close of
business on March 25, 1994, as the record date for the
determination of the holders of shares of the Company's
common stock entitled to notice of and to vote at the
Annual Meeting of Shareholders.
Whether or not you expect to attend the meeting,
you are urged to complete, sign, date and return the
enclosed proxy in the enclosed envelope.
By Order of the Board of Directors,
Robert N. Blackford, Secretary
Orlando, Florida
April 18, 1994
PLEASE FILL IN, DATE, SIGN AND PROMPTLY RETURN THE
ENCLOSED PROXY IN THE ENVELOPE PROVIDED WHICH REQUIRES
NO POSTAGE IF MAILED IN THE UNITED STATES.
HUGHES SUPPLY, INC.
20 North Orange Avenue
Suite 200
Orlando, Florida 32801
________________
PROXY STATEMENT
Annual Meeting of Shareholders
To Be Held May 24, 1994
________________
This Proxy Statement and the accompanying form of
proxy are furnished in connection with the solicitation
of proxies by and on behalf of the Board of Directors
of the Company for use at the Annual Meeting of
Shareholders to be held on May 24, 1994, or any
adjournment thereof. The Company's Annual Report to
shareholders for the fiscal year ended January 28,
1994, accompanies this Proxy Statement. This Proxy
Statement and the accompanying Notice of Annual Meeting
of Shareholders, form of proxy and the Annual Report
have been sent or given to shareholders of the Company
beginning approximately April 18, 1994.
The enclosed proxy is solicited on behalf of the
Board of Directors of the Company. It may be revoked by
the shareholder at any time before it is exercised by
attending and voting in person at the meeting or by
giving written notice of revocation to the Company
provided that such notice is actually received by the
Company prior to the date of the meeting. Any
shareholder of record on the record date attending the
meeting may vote in person whether or not such
shareholder has previously filed a proxy. All shares
represented by properly executed proxies received in
time for the meeting will be voted as directed by the
shareholders.
Solicitation of proxies will be made by mail. The
total expenses of such solicitation will be borne by
the Company and will include reimbursement paid to
brokerage firms and others for their expense in
forwarding solicitation material regarding the Annual
Meeting to beneficial owners. Following the original
solicitation by mail, further solicitation in person or
by telephone or telegraph, may be made by certain
directors, officers or regular employees of the Company
who will not receive additional compensation for
soliciting proxies.
On March 25, 1994, the record date for shareholders
entitled to vote at the Annual Meeting, there were
5,114,361 shares of the Company's common stock
outstanding. Each such share is entitled to one vote.
ELECTION OF DIRECTORS
Five of the Company's ten directors have been
nominated for election at the 1994 Annual Meeting. In
accordance with the Company's Articles of Incorporation
and Bylaws, the Board of Directors is divided into
three approximately equal classes of directors serving
staggered three-year terms so that approximately
one-third of the Board is elected at each annual
meeting. The Articles and Bylaws also provide that any
director who is appointed to the Board since the last
annual meeting of shareholders into a Class of
directors whose term of office continues beyond the
next annual meeting of shareholders shall be subject to
election by the shareholders into that Class at the
next annual meeting of shareholders.
The present term of office of each of the directors
in Class I expires at the 1994 Annual Meeting. Since
the last annual meeting of shareholders two directors
have been appointed to the Board, one into Class I and
the other into Class II. The Board of Directors has
nominated the four directors presently serving in Class
I for election in that Class and the director appointed
into Class II for election in that Class. The present
term of office of each of the other five directors
continues after the 1994 Annual Meeting.
The affirmative vote of a plurality of the votes
cast by the shares entitled to vote at the 1994 Annual
Meeting is required for the election of the directors.
The following persons, each of whom is presently
serving as a director in the class in which he is
nominated, have been selected by the Board of Directors
to be nominated for election as directors.
Nominees for Election as Directors
Class I (term of office expiring May, 1997)
Robert N. Blackford
A. Stewart Hall, Jr.
Russell V. Hughes
Donald C. Martin
Class II (term of office expiring May, 1995)
John D. Baker II
A listing of the positions held in the Company,
principal occupations, the year and month service as a
director began, and the shares of stock in the Company
beneficially owned by each nominee is set forth under
"Directors and Nominees for Election as Directors of
the Company" following this section.
It is the intention of the persons named in the
accompanying form of proxy to nominate, and unless
otherwise directed, to vote such proxies for the
election of the nominees named above as directors in
Classes I and II. In the event that any of the persons
named above should become unable to accept nomination
for election, proxies will be voted for the election of
such other person or persons as the Board of Directors
may recommend. The Board of Directors has no reason to
believe that any substitute nominee will be required.
Directors and Nominees for Election as Directors of the
Company
<TABLE>
The following table lists by class each person
named as a nominee for election as director and each
director whose present term continues after the 1994
Annual Meeting. The table also includes the age,
principal occupation and business experience for the
past five years, positions and offices held with the
Company, month and year service as a director began,
and the number and percentage of shares of common stock
of the Company beneficially owned as of March 25, 1994
for each such person. Unless otherwise indicated by
footnote, directors have sole voting and investment
power with respect to shares shown in the table as
beneficially owned.
<CAPTION>
Name, Age, Principal Occupation Shares of Stock
Positions and and Business Beneficially Percent
Offices Held with Experience for Past Served as Owned as of of
the Company Five Years Director Since March 25, 1994 Class
Directors Class I
Term of Office Expires: May, 1994*
<S> <C> <C> <C> <C>
*Robert N. Blackford, Attorney, Maguire, December, 1970 18,937(7) ---(8)
57, Secretary, Voorhis & Wells, P.A.
Director(1)(2)(3)(4)(5)(6)
*A. Stewart Hall, Jr. President of the March, 1994 59,296(9)(10) 1.2(8)
51, President, Company (March,
Director 1994-Date);
Executive Vice
President of the
Company (January
1988-March, 1994)
*Russell V. Hughes, Vice President of the May,1964 313,905(9)(10)(12) 6.1(8)
68, Vice President, Company
Director(1)(11)
*Donald C. Martin, Consultant to the August, 1993 271,897 5.3(8)
57, Consultant, Company (July,
Director(4)(6)(13) 1993-Date);
President, Electrical
Distributors, Inc.
(1963-June, 1993)
<CAPTION>
Directors Class II
Term of Office Expires: May, 1995
<S> <C> <C> <C> <C>
**John D. Baker II, President, Florida March, 1994 None -----
45, Director(14) Rock Industries, Inc.
(May, 1989-Date);
Executive Vice
President, Florida
Rock Industries, Inc.
(September, 1982-
May, 1989)
Clifford M. Hames, Retired (January, February, 1972 18,044(7) ---(8)
68, Director (1)(3)(4)(6) 1989-Date)
Herman B. McManaway, Retired (January, October,1985 27,000(7) ---(8)
68, Director (2)(3)(6)(15) 1988-Date)
<CAPTION>
Directors Class III
Term of Office Expires: May, 1996
<S> <C> <C> <C> <C>
John B. Ellis, 69,
Director(2)(4)(6)(16) Retired (January, November, 1986 22,000(7) ---(8)
1986-Date)
David H. Hughes, 50, Chairman of the August, 1968 332,986(9) 6.5(8)
Chairman of the Board and Chief (10)(12)(18)
Board, Chief Executive Officer
Executive Officer and (November, 1986-
Director (1)(11)(17) Date); President of
the Company (April,
1972-March, 1994)
Vincent S. Hughes, Vice President of the April, 1966 333,015(9) 6.5(8)
53, Vice President, Company (10)(12)(18)
Director (1)(11)
_______________________________
</TABLE>
* Present term of office of Class I directors expires
at the 1994 Annual Meeting. The directors in Class I
have been designated as nominees for an additional term
of office to expire at the 1997 Annual Meeting.
** Nominee for election as a director in Class II at
the 1994 Annual Meeting; as a director appointed into
Class II, director is subject to election into Class II
on May 24, 1994.
(1) Member of Executive Committee.
(2) Member of Directors' Stock Option Plan Committee.
(3) Member of Audit Committee.
(4) Member of 1988 Stock Option Plan Committee.
(5) Mr. Blackford is a member of a law firm which the
Company has retained during the last fiscal year and
currently retains. See "Certain Transactions with
Management."
(6) Member of Compensation Committee.
(7) Includes the number of shares subject to options
granted under the Directors' Stock Option Plan for
nonemployee directors as follows: Robert N. Blackford,
15,000; Clifford M. Hames, 15,000; Herman B. McManaway,
15,000; John B. Ellis, 15,000.
(8) Calculated on the basis of 5,114,361 shares of the
Company's common stock outstanding and with respect to
each director who holds options, the shares subject to
options granted to such director have been deemed
outstanding for the purpose of computing his
percentage. Figures are shown only for those directors
whose beneficial ownership of shares exceeds 1% of the
common stock outstanding or deemed to be outstanding
for this calculation.
(9) The number of shares shown following the name of
each person identified below in this footnote may be
deemed to be beneficially owned by such person and is
included in the number of shares shown to be
beneficially owned by such person in the above table.
The following listing sets forth the number of shares
subject to options respectively held by each of the
following persons under the Company's 1988 Stock Option
Plan including the number of shares shown in
(parenthesis) which are subject to options not
exercisable in 1994 and to which such persons disclaim
beneficial ownership: A. Stewart Hall, Jr., 43,570
(7,500); Russell V. Hughes, 22,625 (4,000); David H.
Hughes, 44,970 (7,500); Vincent S. Hughes, 26,175
(4,000). The aggregate number of shares credited to the
accounts of each such person under the Company's
Employee Stock Ownership Plan ("ESOP") is as follows:
A. Stewart Hall, Jr., 2,423; Russell V. Hughes, 1,234;
David H. Hughes, 4,122; Vincent S. Hughes, 2,713. The
indicated persons are considered to have sole voting
power and shared investment power with respect to the
shares credited to their accounts under the ESOP. Such
persons are also beneficiaries under the Company's Cash
or Deferred Profit Sharing Plan ("Profit Sharing Plan")
which holds 164,099 shares as unallocated assets of the
Plan. Such persons disclaim beneficial ownership of any
of the shares held by the Plan and none of such shares
are included in the table above as owned by such
persons.
(10) The number of shares shown in the above table
to be beneficially owned includes shares held subject
to shared voting power or shared investment power as
follows: (i) shared voting power: Russell V. Hughes,
273,516; David H. Hughes, 129,070; Vincent S. Hughes,
147,033; (ii) shared investment power: A. Stewart Hall,
Jr., 2,423; Russell V. Hughes, 63,142; David H. Hughes,
133,192; Vincent S. Hughes, 149,746.
(11) Each of the indicated directors is an executive
officer and director of, and owns a one-third equity
interest in, Hughes, Inc., a corporation to which the
Company makes payments for the lease of certain
properties. See "Certain Transactions with Management."
(12) Includes 40,645 shares held by Hughes, Inc.,
the corporation described in footnote (11) above.
Russell V. Hughes, David H. Hughes and Vincent S.
Hughes are considered to share voting and investment
power with respect to such shares and all such shares
are reported in the table above as beneficially owned
by each such person. See also footnotes (2), (3), and
(4) to the table under "Ownership of Securities by
Certain Beneficial Owners" with respect to the share
ownership of David H. Hughes, Vincent S. Hughes, and
Russell V. Hughes.
(13) Mr. Martin provides consulting services to the
Company under a Consulting Agreement and leases
property to a subsidiary of the Company under a Lease
Agreement. See "Certain Transactions with Management."
(14) Mr. Baker is also a director of Florida Rock
Industries, Inc., and FRP Properties, Inc.
(15) Mr. McManaway is also a director of Versa
Technologies, Inc.
(16) Mr. Ellis is also a director of
Interstate/Johnson Lane, Inc., Flowers Industries,
Inc., Oxford Industries, Inc., Scotty's, Inc., Genuine
Parts Company, and Intermet Corporation.
(17) Mr. David H. Hughes is also a director of
SunTrust Banks, Inc.
(18) Includes the following shares held by trusts
with respect to which David H. Hughes and Vincent S.
Hughes are co-trustees together with Sun Bank, N.A.:
29,377 shares held by the Pauline B. Hughes Charitable
Lead Trust; 28,565 shares held by the Vincent S. Hughes
Generation Skipping Trust; and 28,565 shares held by
the David H. Hughes Generation Skipping Trust. All of
the shares held by these trusts are included in the
table above as beneficially owned by each David H.
Hughes and Vincent S. Hughes.
Ownership of Securities by Certain Beneficial Owners
As of March 25, 1994, there were 5,114,361 shares
of the Company's common stock outstanding. The
following table sets forth information with respect to
each person believed by management to have been the
beneficial owner of more than 5% of the outstanding
common stock of the Company as of March 25, 1994, based
upon the statements filed by such persons and referred
to in the footnotes to the table. Unless otherwise
indicated by footnote, such persons have sole voting
and investment power with respect to shares shown in
the table as beneficially owned.
<TABLE>
<CAPTION>
Name and Address of Amount and Nature of Percent of
Beneficial Owner Beneficial Ownership Class(1)
<S> <C> <C>
David H. Hughes
20 North Orange Avenue
Suite 200
Orlando, Florida 332,986 Shares(2) 6.5
Vincent S. Hughes
20 North Orange Avenue
Suite 200
Orlando, Florida 333,015 Shares(3) 6.5
Russell V. Hughes
20 North Orange Avenue
Suite 200
Orlando, Florida 313,905 Shares(4) 6.1
Donald C. Martin
5180 Peachtree Road
Atlanta, Georgia 271,897 Shares(5) 5.3
SunTrust Banks, Inc.
25 Park Place, N.E.
Atlanta, Georgia 520,430 Shares(6) 10.2
The Employers'
Retirement Plan of
Consolidated Electrical
Distributors, Inc. 577,467 Shares(7) 11.3
FMR Corp.
82 Devonshire Street
Boston, Massachusetts 336,800 Shares(8) 6.6
___________________
</TABLE>
(1) Based upon total outstanding shares of 5,114,361 at
March 25, 1994, and with respect to each of the
beneficial owners shown in the table, the shares
subject to options to acquire or rights to acquire upon
conversion of other outstanding securities of the
Company held by each such beneficial owner have been
deemed outstanding for the purpose of computing such
beneficial owner's percentage.
(2) Amendment No. 5 to Schedule 13D dated April 1,
1994, filed with the Securities and Exchange Commission
by David H. Hughes reported aggregate ownership of
332,986 shares. Of such shares, 203,916 shares were
reported as owned with sole voting power, 129,070
shares were reported as owned with shared voting power,
199,794 shares were reported as owned with sole
dispositive power, and 133,192 shares were reported as
owned with shared dispositive power. As to the shares
subject to sole voting power, 131,038 shares were held
as Trustee of the David H. Hughes Trust, 1,040 shares
were held as custodian for Patrick C. Hughes, 22,246
shares were held as trustee of the Kristin E. Hughes
Trust, 500 shares were held as custodian for Shelby L.
Hughes, 4,122 shares were held by the Company's
Employee Stock Ownership Plan (the "ESOP"), and 44,970
of such shares were represented by unexercised options
under the Company's 1988 Stock Option Plan (Mr. Hughes
disclaims beneficial ownership with respect to 7,500 of
these shares which are subject to options which are not
exercisable in 1994). The shares reported as owned with
sole dispositive power included all of the shares owned
with sole voting power except the 4,122 shares held by
the ESOP. As to the shares subject to shared voting
power, 29,377 shares were held as co-trustee of the
Pauline B. Hughes Charitable Lead Trust, 28,565 were
held as co-trustee of the Vincent S. Hughes Generation
Skipping Trust, 28,565 shares were held as co-trustee
of the David H. Hughes Generation Skipping Trust, 1,918
shares were held by the wife of Mr. Hughes, and 40,645
shares were held by Hughes, Inc., a corporation of
which Mr. Hughes is a director, executive officer and a
one-third equity owner. The shares reported as owned
with shared dispositive power included all of the
shares owned with shared voting power together with the
4,122 shares held by the ESOP.
(3) Amendment No. 6 to Schedule 13D dated April 1,
1994, filed with the Securities and Exchange Commission
by Vincent S. Hughes reported aggregate ownership of
333,015 shares. Of the 333,015 shares reported in the
Amendment, 185,982 shares were reported as owned with
sole voting power, 147,033 shares were reported as
owned with shared voting power, 183,269 shares were
reported as owned with sole dispositive power, and
149,746 shares were reported as owned with shared
dispositive power. As to the shares subject to sole
voting power, 100,613 shares were held as trustee of
the Vincent S. Hughes Trust, 27,977 were held as
trustee of the Vincent K. Hughes Trust, 28,504 shares
were held as trustee of the Megan R. Hughes Trust,
2,713 shares were held by the ESOP, and 26,175 of such
shares were represented by unexercised options under
the Company's 1988 Stock Option Plan (Mr. Hughes
disclaims beneficial ownership with respect to the
4,000 of these shares which are subject to options
which are not exercisable in 1994). The shares reported
as owned with sole dispositive power included all of
the shares owned with sole voting power except the
2,713 shares held by the ESOP. As to the shares subject
to shared voting power, 29,377 shares were held as
co-trustee of the Pauline B. Hughes Charitable Lead
Trust, 28,565 shares were held as co-trustee of the
Vincent S. Hughes Generation Skipping Trust, 28,565
shares were held as co-trustee of the David H. Hughes
Generation Skipping Trust, 19,881 shares were held by
the wife of Mr. Hughes, and 40,645 shares were held by
Hughes, Inc., a corporation of which Mr. Hughes is a
director, executive officer and a one-third equity
owner. The shares reported as owned with shared
dispositive power included all of the shares owned with
shared voting power together with the 2,713 shares held
by the ESOP.
(4) Mr. Russell V. Hughes has reported to the Company
beneficial ownership of an aggregate of 313,905 shares
including 40,389 shares reported as owned with sole
voting power, 273,516 shares reported as owned with
shared voting power, 39,155 shares as owned with sole
dispositive power, and 63,142 shares owned with shared
dispositive power. As to the shares subject to sole
voting power, 16,530 shares were held as Trustee of the
Russell V. Hughes Trust, 1,234 shares were held by the
ESOP, and 22,625 of such shares were represented by
unexercised options under the Company's 1988 Stock
Option Plan (Mr. Hughes disclaims beneficial ownership
with respect to 4,000 of these shares which are subject
to options which are not exercisable in 1994). The
shares reported as owned with sole dispositive power
included all of the shares owned with sole voting power
except the 1,234 shares held by the ESOP. As to the
shares subject to shared voting power, 40,645 shares
were held by Hughes Inc., a corporation of which Mr.
Hughes is a director, executive officer and a one-third
equity owner, 21,263 shares are held jointly with Mr.
Hughes' wife, and 211,608 shares were held as
co-trustee of the Russell S. Hughes Trust.
(5) Schedule 13D dated July 8, 1993 filed with the
Securities and Exchange Commission by Donald C. Martin
reported sole voting and dispositive power with respect
to 215,328 shares and shared voting and dispositive
power with respect to 56,569 shares.
(6) Excludes the following shares held by Sun Bank,
N.A. as co-trustee: 29,377 shares held in the Pauline
B. Hughes Charitable Lead Trust; 28,565 shares held in
the Vincent S. Hughes Generation Skipping Trust; 28,565
shares held in the David H. Hughes Generation Skipping
Trust; and 211,608 shares held in the Russell S. Hughes
Trust. Also excludes 4,122 shares, 2,713 shares, and
1,234 shares, respectively, held for the accounts of
David H. Hughes, Vincent S. Hughes, and Russell V.
Hughes in the ESOP by Trust Company Bank, as trustee.
See Notes (2), (3) and (4) above. The reported shares
are held by one or more bank subsidiaries of Sun Banks,
Inc. and Trust Company of Georgia, subsidiaries of
SunTrust Banks, Inc., in various fiduciary and agency
capacities. In Amendment No. 8 to Schedule 13G dated
February 8, 1994, filed with the Securities and
Exchange Commission, SunTrust Banks, Inc. reported
aggregate beneficial ownership of 826,614 shares; sole
voting power with respect to 311,145 shares; shared
voting power with respect to 211,608 shares; sole
dispositive power with respect to 452,620 shares; and
shared dispositive power with respect to 159,479
shares. SunTrust Banks, Inc. and its subsidiaries
disclaim any beneficial interest in the shares
reported. The shares reported by SunTrust Banks, Inc.
are believed to include, among others, shares
beneficially owned by David H. Hughes, Vincent S.
Hughes, Russell V. Hughes, the Company's Cash or
Deferred Profit Sharing Plan and Employee Stock
Ownership Plan.
(7) Amendment No. 9 to Schedule 13D dated March 1,
1994, filed with the Securities and Exchange Commission
by The Employees' Retirement Plan of Consolidated
Electrical Distributors, Inc. (the "Plan"), reported
aggregate beneficial ownership in the plan and
affiliated entities of 577,467 shares, including
257,442 shares issuable upon conversion of debentures
issued by the Company. Of the shares reported, the
214,928 shares issuable upon conversion of debentures
were reported as held by the Plan with sole voting and
dispositive power, and 577,467 shares held by the Plan
and affiliated entities, of which 257,442 shares
represented shares issuable upon conversion of
debentures, were reported as held with shared voting
and dispositive power.
(8) Schedule 13G dated February 11, 1994, filed with
the Securities and Exchange Commission by FMR Corp.
reported sole voting and dispositive power with respect
to 336,800 shares and no shared voting or dispositive
power with respect to any shares.
Ownership of Securities by Officers and Directors
<TABLE>
The following table indicates the beneficial
ownership of common stock of the Company as of March
25, 1994 of the Chief Executive Officer, each of the
Company's four most highly compensated executive
officers other than the Chief Executive Officer, and
all directors (including nominees for election as
directors) and officers of the Company as a group.
<CAPTION>
Shares and Nature of
Beneficial Owner Beneficial Ownership Percent of Class
<S> <C> <C>
David H. Hughes 332,986(1) 6.5(2)
A. Stewart Hall, Jr. 59,296(1) 1.2(2)
Vincent S. Hughes 333,015(1) 6.5(2)
Jasper L. Holland, Jr. 27,504(3) --(2)
Kenneth H. Stephens 25,308(4) --(2)
All Directors and 1,309,376(5) 24.3(9)
Officers as a Group (6)(7)(8)
(13 persons)(1)
</TABLE>
(1) See "Directors and Nominees for Election as
Directors of the Company" for information concerning
the beneficial ownership of shares of the Company by
each director and nominee for election as a director.
(2) Calculated on the basis of 5,114,361 shares of the
Company's common stock outstanding and with respect to
each of the persons noted above, the shares subject to
options granted to such person which have been deemed
outstanding for the purpose of computing his
percentage. Figures shown only for those persons whose
beneficial ownership of shares exceeds 1% of the common
stock outstanding or deemed to be outstanding for this
calculation.
(3) Includes 2,434 shares held by the Company's ESOP
and 22,610 shares represented by unexercised options
under the Company's 1988 Stock Option Plan (Mr. Holland
disclaims beneficial ownership with respect to 4,000 of
these shares which are subject to options not
exercisable in 1994). Mr. Holland is considered to have
sole voting power and investment power with respect to
25,070 shares, and shared investment power with respect
to 2,434 shares.
(4) Includes 2,181 shares held by the Company's ESOP
and 22,362 shares represented by unexercised options
under the Company's 1988 Stock Option Plan (Mr.
Stephens disclaims beneficial ownership with respect to
4,000 of these shares which are subject to options not
exercisable in 1994). Mr. Stephens is considered to
have sole voting power with respect to 25,308 shares,
sole investment power with respect to 23,127 shares,
and shared investment power with respect to 2,181
shares.
(5) Includes the following shares held by trusts of
which David H. Hughes and Vincent S. Hughes are
co-trustees and with respect to which they share voting
and dispositive power: 29,377 shares held by the
Pauline B. Hughes Charitable Lead Trust; 28,565 shares
held by the Vincent S. Hughes Generation Skipping
Trust; and 28,565 shares held by the David H. Hughes
Generation Skipping Trust. Also includes 40,645 shares
owned by Hughes, Inc., a corporation of which David H.
Hughes, Vincent S. Hughes and Russell V. Hughes are the
officers and directors, and in which each owns a
one-third interest. David H. Hughes, Vincent S. Hughes
and Russell V. Hughes share voting and dispositive
power with respect to the shares owned by Hughes, Inc.
The multiple reporting of beneficial ownership by the
foregoing persons with respect to the shares held by
the several trusts and the shares owned by Hughes, Inc.
set forth in the tabular information under "Ownership
of Securities by Certain Beneficial Owners" and
"Directors and Nominees for Election as Directors of
the Company" elsewhere in this Proxy Statement has been
eliminated in the table above.
(6) Includes an aggregate of 207,017 shares subject to
unexercised stock options under the Company's 1988
Stock Option Plan held by directors and officers of the
Company as a group and 60,000 shares subject to
unexercised stock options under the Company's
Directors' Stock Option Plan held by nonemployee
directors of the Company as a group.
(7) Includes an aggregate of 15,416 shares credited to
the accounts of directors and officers of the Company
under the ESOP.
(8) Sole voting power with respect to 870,985 shares,
shared voting power with respect to 438,391 shares,
sole investment power with respect to 855,569 shares
and shared investment power with respect to 242,199
shares.
(9) Calculated on the basis of 5,381,378 shares,
including 5,114,361 shares of the Company's common
stock outstanding and 267,017 shares subject to options
which have been deemed outstanding for the purpose of
computing such percentage.
Board of Directors' Meetings and Attendance
During the last fiscal year, the Board of Directors
of the Company held a total of eight meetings. No
member of the Board attended fewer than 75% of the
aggregate of (1) the total number of meetings of the
Board of Directors, and (2) the total number of
meetings held by all committees of the Board on which
he served.
Family Relationships Between Certain Directors
The following family relationships exist between
directors of the Company:
Mr. David H. Hughes and Vincent S. Hughes are
brothers; and Russell V. Hughes is a first cousin of
David H. Hughes and Vincent S. Hughes.
Committees of the Board of Directors
The Board of Directors of the Company has standing
Executive, Audit, Compensation, 1988 Stock Option Plan,
and Directors' Stock Option Plan Committees. Members of
the standing committees of the Board are indicated by
the footnotes to the table under "Directors and
Nominees for Election as Directors of the Company"
above. The Company does not have a nominating
committee.
The Executive Committee has authority to act on
matters of general corporate governance when the Board
is not in session. The Executive Committee did not meet
during the last fiscal year.
The Audit Committee met four times during the last
fiscal year. At its meetings, the Committee made its
recommendation to the Board of Directors with respect
to the terms of engagement of the Company's independent
auditors for the fiscal year ended January 28, 1994,
and considered the recommendations of the Company's
independent auditors with respect to internal
accounting control, reviewed management's actions taken
in response to such recommendations, reviewed the
reports of the Company's accounting staff with respect
to internal controls, and reviewed the professional
services provided by the independent auditors together
with the range of audit and nonaudit fees.
The Compensation Committee met four times during
the last fiscal year and reviewed and made
recommendations to the Board of Directors with respect
to the compensation of members of the Company's
executive management group. Information with respect to
the Committee's recommendation for the last fiscal year
is set forth elsewhere in this proxy statement under
"Compensation Committee Report on Executive
Compensation."
The 1988 Stock Option Plan Committee has the
authority to make recommendations to the Board of
Directors with respect to the granting of options under
the Plan. The Directors' Stock Option Plan Committee
and the 1988 Stock Option Plan Committee each have
authority to interpret the application of the
provisions of their respective Plans. Neither of such
Committees met during the last fiscal year.
Cash Compensation of Directors
Nonemployee directors of the Company receive an
annual retainer of $15,000 and attendance fees of
$1,000 for each Board meeting attended in person or
$250 for each Board meeting attended by conference
telephone. For each meeting of a committee of the Board
such nonemployee directors receive an attendance fee of
$500 for attendance in person or $250 for attendance by
conference telephone. Directors who are employees of
the Company do not receive directors' or committee
members' fees. Mr. Robert N. Blackford, John B. Ellis,
Clifford M. Hames, Herman B. McManaway and Donald C.
Martin served as nonemployee directors and received
nonemployee director's fees during the fiscal year
ended January 28, 1994. Mr. John D. Baker II was first
appointed as a nonemployee director on March 24, 1994,
and did not receive any director's fees from the
Company during the last fiscal year.
Directors' Stock Option Plan
The Company's Directors' Stock Option Plan
presently provides for the granting to nonemployee
directors of options (which are not incentive stock
options within the meaning of Section 422A of the
Internal Revenue Code) for the purchase of an aggregate
of up to 60,000 shares of common stock of the Company.
Under the terms of the Plan, options for the purchase
of 12,000 shares were granted as of January 24, 1989,
the date of adoption of the Plan, and options for an
additional 12,000 shares were granted at each of the
annual meetings of the Board of Directors following the
1990, 1991, 1992 and 1993 annual meetings of the
shareholders. The options granted in 1989, 1990, 1991,
1992 and 1993 were granted at option prices of $17.625
per share, $15.00 per share, $12.625 per share, $12.00
per share, and $16.25 per share, respectively, and were
divided equally among Robert N. Blackford, John B.
Ellis, Clifford M. Hames and Herman B. McManaway, the
Plan's four nonemployee directors on each such grant
date, so that each such participant has received
options for the purchase of an aggregate of 15,000
shares since inception of the Plan. Options have been
granted with respect to all 60,000 of the shares
authorized for options under the Plan.
No additional options may be granted under the Plan
except with respect to any shares subsequently returned
to the Plan because of the expiration or termination of
outstanding options or with respect to additional
shares authorized by an amendment to the Plan approved
by the shareholders. An amendment to the Plan to
authorize the granting of options with respect to
75,000 additional shares is proposed for shareholder
approval at the 1994 Annual Meeting of Shareholders.
See "Approval of Amendment to Directors' Stock Option
Plan" in this Proxy Statement for additional
information with respect to the Plan and options
granted, and to be granted, under the Plan.
<TABLE>
The following table sets forth the aggregate
numbers of shares of common stock of the Company
subject to stock options granted and outstanding as of
March 25, 1994, under the Directors' Stock Option Plan
to the named participants and to all such participants
as a group, the average per share exercise prices
applicable to such shares, and the net values (market
value less exercise price) for such shares realized
during the fiscal year ended January 28, 1994.
<CAPTION>
Aggregate Net Value
Number of Average Realized During
Shares Subject Per Share Fiscal Year
Name of Person or to Options at Exercise Year Ended
Identity of Group January 28, 1994 Price January 28, 1994
<S> <C> <C> <C>
Robert N. Blackford 15,000 $14.70 None
John B. Ellis 15,000 14.70 None
Clifford M. Hames 15,000 14.70 None
Herman B. 15,000 14.70 None
McManaway
All Participants 60,000 14.70 None
as a Group
(4 persons)
</TABLE>
EXECUTIVE COMPENSATION AND OTHER INFORMATION
Executive Officers
Executive Officers are elected annually by the
Board of Directors following the Annual Meeting of
Shareholders to serve for a one-year term and until
their successors are elected and qualified. The
compensation of the Company's executive officers is
established by the Board of Directors after receiving
the recommendation of the Compensation Committee of the
Board. The following sets forth the name of each
executive officer of the Company and the principal
positions and offices he holds with the Company. Unless
otherwise indicated, each of these officers has served
as an executive officer of the Company for at least
five years.
<TABLE>
<CAPTION>
Name Information About Executive Officers
<S> <C>
David H. Hughes Chairman of the Board and Chief Executive Officer
of the Company. Until March 24,
1994, Mr. Hughes also served as President of the
Company. He is 50 years of age.
A. Stewart Hall, Jr. President of the Company.
Until March 24, 1994, Mr. Hall served as Executive Vice
President of the Company. He is 51 years of age.
Vincent S. Hughes Vice President, Utility
Sales, of the Company. Mr. Hughes is 53 years of age.
Jasper L. Holland, Jr. Vice President of the
Company and Regional Manager of the North Florida
Region. Mr. Holland is 52 years of age.
Kenneth H. Stephens Vice President of the
Company and Regional Manager of the Alabama/Georgia
Region. Mr. Stephens is 53 years of age.
Russell V. Hughes Vice President of the
Company. Mr. Hughes is 68 years of age.
J. Stephen Zepf Chief Financial Officer and
Treasurer of the Company. Mr. Zepf is 44 years of age.
</TABLE>
Compensation Committee Report
Notwithstanding anything to the contrary set forth
in the Company's previous filings under the Securities
Act of 1933, as amended, or the Securities Exchange Act
of 1934, as amended, that might incorporate future
filings, including this proxy statement, in whole or in
part, the following report and the Performance Graph on
page 19 shall not be incorporated by reference into any
such filings.
Compensation Committee Report on Executive Compensation
Compensation of Executive Officers
Compensation Committee Report
The compensation of the Company's executive
management group is established by the Board of
Directors acting upon the recommendations of the
Compensation Committee of the Board. The Committee
consists of five nonemployee directors, three of whom
served as members of the Committee throughout the last
fiscal year and two of whom became committee members
during the fiscal year. Mr. John B. Ellis, Robert N.
Blackford and Clifford M. Hames served as members of
the Committee throughout the last fiscal year. Mr.
Herman B. McManaway was appointed to the Committee on
May 25, 1993, and Donald C. Martin was appointed to the
Committee on August 24, 1993. During the last fiscal
year the Company's executive management group included
the seven executive officers (two of whom are also
regional managers) and three other regional managers of
the Company and the chief executive officers of the
Company's five major subsidiaries. The recommendations
with respect to executive management group salaries and
bonus plan compensation for the last fiscal year were
made by the Committee and adopted by the Board on
January 27, 1993, March 24, 1993 and May 25, 1993.
Compensation Policy and Committee Recommendation
It is the policy of the Company to fairly
compensate the Company's executive management group and
safeguard the shareholders' investment in the Company.
In formulating its executive management group
compensation recommendation to the Board of Directors,
the Committee evaluated the demands of the respective
positions, the competitive market for the required
management skills, the effectiveness of each of the
members of the executive management group in the
performance of their positions, and the Company's
results of operations. The Committee also evaluated the
Company's management requirements, the reasonable costs
of meeting those requirements, and the necessity to
achieve favorable results of operations given the
general market in which the Company operates. Before
finalizing its recommendation, the Committee also
considered the recommendation of the Company's Chief
Executive Officer with respect to the compensation of
each of the other members of the executive management
group.
Compensation Program
The four main components of the Company's executive
compensation program which were considered by the
Committee in formulating its recommendation to the
Board were base salary, cash incentive plans, stock
based incentive plans, and retirement plans. Each of
these components is discussed in the remainder of this
Committee report. Information with respect to the
compensation paid to the Company's Chief Executive
Officer and the other four most highly compensated
executive officers of the Company for the last fiscal
year and for each of the two previous fiscal years,
descriptions of certain of the compensation plans
referred to in this report, and a performance graph
illustrating cumulative shareholder return with respect
to the Company's common stock are set forth elsewhere
in this proxy Statement following this Committee
report.
Base Salary
The base salary for each member of the executive
management group is intended to establish a fixed
salary which, when considered together with other
elements of the compensation program, will help the
Company attract and retain the talent needed to meet
the challenges of the very competitive industry in
which it operates. The Committee's recommendation with
respect to base salaries was based upon the Committee's
evaluation of the responsibility and scope of each
position within the Company, the level of pay for
comparable positions in the industry and, with respect
to each member of the executive management group, his
performance over an extended period of time.
Cash Incentive Plans
The cash incentive plans include the annual bonus
plans for designated members of the executive
management group and other key employees, discretionary
individual bonuses, and long-term incentive bonus plans
applicable to three of the executive officers.
The annual bonus plans provide for bonus payments
based upon results of operations determined by applying
a percentage, fixed in accordance with the Company's
profit plans, to the base salaries of the participants.
The designation of the annual bonus plan participants,
the operations of the Company which will be measured to
determine bonus payments to such participants, and the
profit plans which will be applicable to such
operations are established annually by the Board of
Directors upon the recommendation of the Compensation
Committee.
The members of the Company's executive management
group were recommended by the Committee and designated
by the Board of Directors as participants in the annual
bonus plans during the last fiscal year. The
Committee's recommendation with respect to the
participants and criteria for payments under the annual
bonus plans was based upon the Committee's conclusion
that the applicable profit plans established ambitious
goals for improvement in the results of operations of
the Company which would be sufficiently achievable to
provide a meaningful incentive for superior
performance, and that the designated participants were
in those positions of responsibility which are most
relevant to the success of the Company.
The Company's Chief Executive Officer, President
(previously as Executive Vice President and currently
as President), and Chief Financial Officer also
participate in the long-term incentive bonus plan for
the fiscal year 1995 which was adopted during the
fiscal year ended January 31, 1992, and is based upon
cumulative growth in earnings per share of the Company
for the four fiscal years commencing with the fiscal
year ended January 31, 1992. Under the plan, a bonus,
if earned, would be paid in cash following the fiscal
year to be ended January 27, 1995. No action with
respect to the plan was taken by the Committee or the
Board of Directors during the last fiscal year and no
amount has been accrued in the Company's financial
statements for payouts relating to the plan.
During the fiscal year ended January 28, 1994, the
Committee recommended, and the Board of Directors
approved, the senior executives' long-term incentive
bonus plan for the fiscal year 1996. Under the Plan,
the Company's Chief Executive Officer, President
(previously as Executive Vice President and currently
as President), and Chief Financial Officer would
receive a bonus of from 25% to 100% of base salary for
the final year of the three year period ending with the
fiscal year to be ended January 26, 1996 if the Company
achieves the required earnings per share during the
three fiscal year period. The bonus, if any, earned
under the plan would be paid 50% in cash and 50% in
shares of common stock of the Company following the end
of the 1996 fiscal year. The stock award provision of
the plan is subject to shareholder approval at the 1994
Annual Meeting of Shareholders. If the stock award
provision of the plan is not approved by the
shareholders, any bonus earned under the plan will be
paid 100% in cash.
Stock Based Incentive Plans
The Company's stock based incentive programs
include the 1988 Stock Option Plan and the Employee
Stock Ownership Plan. The Company did not grant any
options to any of the executive officers of the Company
during the last fiscal year. A contribution of $500,000
to be allocated among all participants under the
Employee Stock Ownership Plan was made by the Company
for the fiscal year ended January 28, 1994. The senior
executives' long-term incentive bonus plan for the
fiscal year 1996, proposed for approval by the
shareholders at the 1994 Annual Meeting, also provides
for payment in shares of the Company that 50% of any
bonus earned under the plan will be paid.
Retirement Plans
The Company's retirement plans include the Cash or
Deferred Profit Sharing Plan and the Supplemental
Executive Retirement Plan.
The Cash or Deferred Profit Sharing Plan is a
contributory plan for the benefit of substantially all
employees of the Company under which employees may make
limited contributions by salary reduction.
Contributions by the Company under the Plan include
those required to match a portion of an employee's
contribution and may include limited additional
contributions within the discretion of the Board of
Directors. The Company did not make any discretionary
contribution under the Plan for the last fiscal year.
The Supplemental Executive Retirement Plan was
adopted on September 30, 1986 and six of the executive
officers of the Company, all of those who were fifty
five years of age or younger on the date of adoption of
the Plan, are participants under the Plan. The
Compensation Committee did not take any action with
respect to the Supplemental Executive Retirement Plan
during the last fiscal year.
Compensation of the Chief Executive Officer
Mr. David H. Hughes, the Company's Chief Executive
Officer, is eligible to participate in the same
components of the executive management compensation
program available to the other members of the executive
management group described above and the recommendation
of the Compensation Committee with respect to Mr.
Hughes' compensation was determined in the manner
outlined above with respect to the executive management
group. For the last fiscal year his cash compensation
was $270,000. Performance driven incentives accounted
for 33% of this amount. Mr. Hughes had a base salary of
$180,000, which the Committee believes is a
conservative salary in comparison to his peers in the
industry. Mr. Hughes' base salary was increased from
$156,000 during the last fiscal year to compensate him
in a manner more consistent with his responsibilities.
His base salary remained unchanged during the three
preceding fiscal years.
Submitted by the Compensation Committee of the
Company's Board of Directors.
John B. Ellis -
Chairman
Robert N. Blackford
Clifford M. Hames
Donald C. Martin
Herman B. McManaway
Cash Compensation of Executive Officers
<TABLE>
The following table sets forth the annual and
long-term compensation for the Company's Chief
Executive Officer and the other four most highly
compensated executive officers (the "named executives")
during the last fiscal year, as well as the total
annual compensation paid to each individual for the two
previous fiscal years.
<CAPTION>
Long-Term Compensation
All Other
Annual Compensation Awards Payouts Compensation
Name/ Fiscal Salary Bonus Other Options LTIP
Principal Position Year ($) ($) ($) (#) ($) ($)(1)
<S> <C> <C> <C> <C> <C> <C> <C>
David H. Hughes/Chairman 1994 180,000 90,000 -0- -0- -0- 125,224
of the Board, Chief 1993 156,000 62,400 -0- -0- -0- 29,956
Executive Officer and 1992 156,000 -0- -0- 37,500
President
A. Stewart Hall, Jr./ 1994 150,000 75,000 -0- -0- -0- 116,415
Executive Vice President 1993 135,000 54,000 -0- -0- -0- 35,701
1992 125,000 15,000 -0- 37,500
Vincent S. Hughes/ 1994 105,000 52,500 -0- -0- -0- 37,732
Vice President 1993 100,000 40,000 -0- -0- -0- 30,151
1992 95,000 -0- -0- 20,000
Jasper L. Holland, Jr./ 1994 106,423 52,923 -0- -0- -0- 35,552
Vice President 1993 99,640 50,000 -0- -0- -0- 27,208
1992 95,000 15,000 -0- 20,000
Kenneth H. Stephens/ 1994 104,590 52,000 -0- -0- -0- 34,659
Vice President 1993 99,640 25,000 -0- -0- -0- 29,050
1992 95,000 10,000 -0- 20,000
________________________
(1) Includes for the fiscal years indicated below: (i)
the cost of premiums paid by the Company for life
insurance provided to the named executive, (ii) amounts
accrued in the Company's financial statements under
Supplemental Executive Retirement Plan ("SERP")
agreements, (iii) contributions made to the accounts of
the named executive in the Cash or Deferred Profit
Sharing Plan, (iv) Company discretionary contributions
to the Employee Stock Ownership Plan ("ESOP"), and (v)
amounts accrued in the Company's financial statements
under the Long-Term Incentive Plan as calculated with
respect to that period.
<CAPTION>
Fiscal Insurance Matching ESOP
Executive Year Premium SERP Contribution Contribution LTIP
<S> <C> <C> <C> <C> <C> <C>
David H. 1994 $ 696 $38,277 $ 3,636 $11,948(a) $70,667
Hughes 1993 696 26,920 2,340 -0- -0-
A. Stewart 1994 1,152 46,598 2,608 7,057(a) 59,000
Hall, Jr. 1993 696 32,755 2,250 -0- -0-
Vincent S. 1994 1,152 26,627 2,175 7,778(a) -0-
Hughes 1993 1,152 27,504 1,495 -0- -0-
Jasper L. 1994 1,152 24,963 2,346 7,091(a) -0-
Holland, Jr. 1993 1,152 24,336 1,720 -0- -0-
Kenneth H. 1994 1,152 26,627 438 6,442(a) -0-
Stephens 1993 1,152 27,504 394 -0- -0-
________________________
</TABLE>
(a) Contribution estimated as named person's pro-rata
plan interest, as last calculated by the plan trustee,
applied to the Company's aggregate contribution of
$500,000 for the fiscal year ended January 28, 1994.
Long-Term Incentive Plans - Awards in Last Fiscal Year
The following table provides information concerning
incentive awards made during fiscal 1994 under the
Company's senior executives' long-term incentive bonus
plan for the fiscal year 1996 to the Company's Chief
Executive Officer and the only other participant under
the plan who is among the Company's other four most
highly compensated executive officers. There is one
additional participant under the plan. Each award
represents the right to receive an amount in cash and
stock if, and only if, consolidated fully diluted
earnings per share for the three year period ending
January 26, 1996 equal or exceed certain levels which
have been set by the Board of Directors upon the
recommendation of the Compensation Committee. If fully
diluted earnings per share falls between the threshold
level and the maximum level, then the amount of the
award is prorated accordingly. Payments made under the
long-term program are reported in the Summary
Compensation Table in the year of payout.
<TABLE>
<CAPTION>
Estimated Future Payouts under Non-Stock
Price-Based Plans
____________________________________
Performance or
Number of Other Period
Shares Until Maturation Threshold Target Maximum
Name (#) or Payout ($) ($) ($)
<S> <C> <C> <C> <C> <C>
David H. Hughes N/A 3 years 56,700(1) (2) 226,800(1)
A. Stewart Hall, Jr. N/A 3 years 48,600(1) (2) 194,400(1)
__________________________
</TABLE>
(1) Based on estimated base salary levels for final
year of performance period.
(2) If earnings per share fall between the required
threshold level and the maximum award level, the amount
of the award is prorated accordingly.
Bonus Plans and Other Benefits
The Company has annual bonus plans for members of
its executive management, and for its sales, branch and
department managers and other key employees. Bonuses
are awarded under the annual bonus plans in amounts
determined by applying a percentage, fixed in
accordance with the Company's profitability, to the
base salaries of members of its executive management.
Individual bonuses may also be awarded to executive
management and other key employees by the Board of
Directors based upon job performance or other criteria
within the discretion of the Board.
The Company also has a long-term incentive bonus
plan for the fiscal year 1995 for its Chief Executive
Officer, President (previously as Executive Vice
President and currently as President), and Chief
Financial Officer. The plan was adopted on May 28, 1991
and provides for payments based upon cumulative growth
in the Company's earnings per share during the four
year period including the fiscal year ended January 31,
1992 and the Company's three fiscal years thereafter.
No amount has been accrued in the Company's financial
statements for possible payouts under the plan.
The Chief Executive Officer, President (previously
as Executive Vice President), and the Chief Financial
Officer also participate in the senior executives'
long-term incentive bonus plan for fiscal year 1996.
The plan provides for payments based upon cumulative
growth in the Company's earnings per share during the
three year period commencing with the fiscal year ended
January 28, 1994 and ending with the fiscal year to be
ended January 26, 1996. Under the plan, the Chief
Executive Officer, President, and Chief Financial
Officer would receive a bonus of from 25% to 100% of
base salary for the fiscal year of the three year
period if the Company achieves the required earnings
per share for the period. Any bonus earned would be
paid in cash and shares of the Company. The stock award
provision of the plan is subject to approval at the
1994 Annual Meeting of Shareholders. If such provision
is not approved by the shareholders, any such bonus
would be paid entirely in cash. The Company has accrued
$165,000 in its financial statements for possible
payouts in cash and shares or solely in cash under the
plan.
The Company provides $250,000 life insurance
policies for members of its executive management, and
$100,000 life insurance policies for other key
employees.
Supplemental Executive Retirement Plan
The Company has Supplemental Executive Retirement
Plan Agreements entered into on September 30, 1986 with
certain of its executive officers providing for the
payment by the Company to each such executive officer
in the event of such executive officer's employment
with the Company until retirement, or until the date of
disability preceding disability retirement, of
supplemental retirement compensation in addition to any
compensation paid under the Company's other benefit
programs. Supplemental retirement compensation will be
based upon such executive officer's salary (not
including bonuses or other compensation) for the final
year of employment prior to retirement, or final year
of employment prior to the disability preceding
disability retirement, ("final salary") and will be
payable monthly following such retirement for a period
of 15 years. The rate per annum of supplemental
retirement compensation in the case of retirement or
disability retirement at age 65 shall be equal to 35%
of final salary or, in the case of early retirement or
early disability retirement with the approval of the
Company prior to age 65 but not earlier than age 55,
shall be reduced proportionately from 96% of 35% of
final salary upon retirement at age 64 to 60% of 35% of
final salary upon retirement at 55. Death benefits are
payable under each of the Agreements in the event of
death while employed by the Company prior to retirement
or during continued disability which commenced while in
the employ of the Company but prior to disability
retirement. Death benefits are payable monthly for a
period of 10 years after death at the rate per annum
equal to 35% of final base salary.
Benefits under the Supplemental Executive
Retirement Plan Agreements are totally nonvested,
unfunded retirement and death benefits; however, for
accounting purposes, amounts are accrued in the
Company's financial statements for the Company's
liability under the Agreements.
Employee Stock Ownership Plan
The Company has a noncontributory, trusteed
Employee Stock Ownership Plan ("ESOP") covering
employees of the Company and certain of its
subsidiaries who have attained the age of 21 and
completed at least 12 months of service. Trust Company
Bank is trustee of the ESOP. The ESOP is administered
by an administrative committee appointed by the
Company's Board of Directors. Contributions by the
Company, which may consist of cash, stock of the
Company, or other property acceptable to the trustee,
are made at the discretion of the Company's Board of
Directors, but may not exceed the maximum amount
deductible for federal income tax purposes. Allocations
of contributions are made to the accounts of active
participants on the basis of their compensation. Vested
percentages of their accounts (valued in accordance
with the ESOP) are distributed to participants upon
termination of employment. Vested percentages are based
upon periods of service, as follows: less than 3 years,
0%; 3 years, 20%; 4 years, 40%; 5 years, 60%; 6 years,
80%; 7 years or more, 100%. A contribution of $500,000
was made by the Company to the ESOP for the fiscal year
ended January 28, 1994.
1988 Stock Option Plan
The Company's 1988 Stock Option Plan presently
authorizes the granting of options, in addition to
those presently outstanding, for the purchase of up to
755,658 shares of the Company's common stock to key
executive, management, and sales employees. Under the
Plan, options may be granted at prices not less than
market value on the date of grant, but prices for
incentive stock options granted to employees who own
more than 10% of the Company's common stock are at
least 110% of such market value. Options may be granted
from time to time through May, 1998, such options may
be exercisable for up to 10 years from the date of
grant, except in the case of employees owning more than
10% of the Company's common stock, for whom incentive
stock options may be exercisable only up to 5 years
from the date of grant. The Plan permits the granting
of both incentive stock options and nonincentive stock
options and the granting of options with cash surrender
rights comparable to stock appreciation rights
("SAR's"). No options have been granted under the Plan
as nonincentive stock options or as options with SAR's.
No options were granted to any of the executive
officers of the Company during the last fiscal year.
Aggregate Option/SAR Exercises in Last Fiscal Year and
Fiscal Year-end Option/SAR Values
<TABLE>
The following table summarizes options and SARs
exercised during the fiscal year ended January 28, 1994
and presents the value of unexercised options and SARs
held by the named executives at fiscal year end.
<CAPTION>
Value of
Number of Unexercised
Unexercised In-the-Money
Options at Options at
Shares January 28, 1994 January 28, 1994
Acquired Value (#) ($)
on Exercise Realized Exercisable (E)/ Exercisable (E)/
Name (#) ($) Unexercisable (U) Unexercisable (U)
<S> <C> <C> <C> <C> <C> <C>
David H. Hughes -0- -0- 29,970 (E) 336,218 (E)
15,000 (U) 166,875 (U)
A. Stewart Hall, Jr. -0- -0- 28,570 (E) 320,118 (E)
15,000 (U) 166,875 (U)
Vincent S. Hughes -0- -0- 18,175 (E) 204,513 (E)
8,000 (U) 89,000 (U)
Jasper L. Holland, Jr. -0- -0- 18,070 (E) 203,305 (E)
8,000 (U) 89,000 (U)
Kenneth H. Stephens 1,258 7,013 14,362 (E) 160,663 (E)
8,000 (U) 89,000 (U)
</TABLE>
Cash or Deferred Profit Sharing Plan
The Company has a contributory, trusteed Cash or
Deferred Profit Sharing Plan for the benefit of
substantially all employees of the Company and its
subsidiaries. Sun Bank, National Association is trustee
of the Plan. The Plan is administered by an
administrative committee appointed by the Company's
Board of Directors. Eligible employees may contribute
to the Plan by salary reduction, and before imposing
federal income taxes, from 2% to 15% of their cash
compensation up to a maximum of $7,000 per year as
adjusted for inflation ($9,240 for 1994). On employee
contributions of up to 3% of the employee's cash
compensation, the Company will contribute a matching
contribution of 50% of the employee's contribution.
Additional discretionary contributions by the Company,
which may be either a fixed dollar amount or a
percentage of profits, may be made to the Plan at the
discretion of the Company's Board of Directors, but all
employee and Company contributions may not exceed the
maximum amount deductible for federal income tax
purposes. Allocations of discretionary Company
contributions are made to the accounts of active
participants on the basis of their compensation. The
full amounts credited to their accounts (valued in
accordance with the Plan) are distributed to
participants upon their death or retirement. For
participants who cease to be employees prior to death
or retirement, the amounts distributed are 100% of the
participant's contribution account and the vested
percentage of the participant's Company contribution
account based upon the participant's period of service
as follows: less than 3 years, 0%; 3 years, 20%; 4
years, 40%; 5 years, 60%; 6 years, 80%; 7 years or
more, 100%. For the fiscal year ended January 28, 1994,
all contributions by the Company to the Plan were made
to match contributions by employees and no
discretionary contribution was made by the Company to
the Plan for the period.
Shareholder Return
The following graph compares, during the five year
period ended January 28, 1994, the yearly percentage
change in the cumulative total shareholder return on
the Company's common stock with the cumulative total
return of the S&P Mid Cap Index and the cumulative
total return of an industry group consisting of those
peer group companies identified in the graph which have
been selected by the Company as reporting companies
whose lines of business are comparable to those of the
Company.
Total Return - Data Summary
HUG
Cumulative Total Return
1/89 1/90 1/91 1/92 1/93 1/94
Hughes Supply Inc HUG 100 90 69 68 80 142
Peer Group PPEER1 100 92 63 70 109 137
S & P MIDCAP 400 IMID 100 116 130 184 184 236
Peer group consists of:
Davis Wtr & Waste Inds Inc DWW
Noland Co NOLD
Watsco Inc WSO.A
Watsco Inc WSO.B
Wilcox & Gibbs Inc WG
Compensation Committee Interlocks and Insider
Participation in Compensation Decisions
Mr. Robert N. Blackford, one of the Company's five
nonemployee directors who constitute the Compensation
Committee, also serves as Secretary of the Company and
is a member of the law firm of Maguire, Voorhis &
Wells, P.A., which provided legal services to the
Company during the last fiscal year and which continues
to provide legal services to the Company during the
current fiscal year.
Mr. Donald C. Martin, a nonemployee director member
of the Compensation Committee, provides consulting
services to the Company under a Consulting Agreement
and leases property under a Lease Agreement with
Electrical Distributors, Inc., a subsidiary of the
Company. Information with respect to the Consulting
Agreement and the Lease Agreement is set forth under
"Certain Transactions with Management" in this Proxy
Statement.
As indicated in the Compensation Committee Report
on Executive Compensation set forth elsewhere in this
proxy statement, David H. Hughes, the Chief Executive
Officer of the Company, consulted with the Committee
with respect to the compensation of the executive
management group and submitted to the Committee his
recommendation for compensation of the other members of
the group. Mr. Hughes, who is not a member of the
Compensation Committee, consulted with the Committee
and provided his recommendation at the Committee's
request.
Certain Transactions with Management
A number of the buildings and properties occupied
by the Company and certain of its subsidiaries are
leased from Hughes, Inc., a company of which David H.
Hughes, Vincent S. Hughes, and Russell V. Hughes are
the officers and directors, and in which each owns a
one-third interest. Under leases in effect during the
fiscal year ended January 28, 1994, the Company and its
subsidiaries made rental payments to Hughes, Inc.
aggregating $1,373,838 and paid real estate taxes and
building insurance on the leased properties in the
aggregate amounts of approximately $238,146 and
approximately $24,741, respectively. Maintenance
repairs which were paid for by the Company during the
last fiscal year were not substantial and were, in the
opinion of management, normal for the types of
properties leased.
The table below sets forth the location, use, size,
expiration date and annual rental for properties leased
by the Company and its subsidiaries from Hughes, Inc.
under leases in effect during the fiscal year ended
January 28, 1994 or approved by the Board of Directors
during the fiscal year ended January 28, 1994, to take
effect thereafter. All properties listed in the table
are located in Florida unless otherwise indicated.
Under the leases, the Company pays for repairs other
than structural repairs, real estate taxes and
insurance on the leased properties.
<TABLE>
<CAPTION>
LEASES WITH HUGHES, INC.
Approximate Area (sq.ft.) Lease Terms
Outside
Facility Use of Parking Expiration Annual
Location Premises Building & Storage Date Rental
<S> <C> <C> <C> <C> <C>
Clearwater Sales 21,000 59,500 3/31/98 $ 47,250
Outlet
Daytona Beach Sales 23,000 68,000 3/31/98 80,500
Outlet
Fort Pierce Sales 30,000 60,000 3/31/98 67,500
Outlet
Gainesville Electrical 29,507 1.9 acres 3/31/02 95,880(1)
and Tool
Sales Outlet
Lakeland Sales 34,000 43,700 3/31/98 85,250(2)
Outlet
Leesburg Sales 20,000 37,000 3/31/98 32,400
Outlet
Orlando Electrical 108,000 87,000 3/31/98 270,000
Sales
Outlet
Orlando Plumbing 64,000 105,000 3/31/98 160,000
Sales
Outlet
Orlando Vehicle 14,000 100,000 (3) 42,000(3)
Maintenance
Garage and
Truck Terminal
Orlando Utility 30,000 90,000 3/31/98 73,500
Warehouse
St. Petersburg Sales 43,000 41,000 3/31/98 96,750
Outlet
Sarasota Sales 37,500 38,000 (4) 132,900(4)
Outlet
Tallahassee Sales 37,750 2.4 acres 3/31/02 81,180(1)
Outlet
Valdosta, Sales 12,693 1.4 acres 3/31/02 31,728(1)
Georgia Outlet
Venice Sales 15,000 54,500 3/31/98 45,000
Outlet
Winter Haven Sales 24,000 46,000 3/31/98 32,000
Outlet
______________________
</TABLE>
(1) Annual rent under lease executed March 11, 1992.
Indicated annual rental rate is applicable April 1,
1992, through March 31, 1997; April 1, 1997, and each
April 1 thereafter during the term of the lease the
annual rental rate shall be increased by a percentage
equal to the percentage increase in the Consumer Price
Index compared with the previous year, subject to a
maximum rental rate increase of five percent for any
such year.
(2) Includes properties under two separate leases with
annual rentals as follows: 27,000 square foot facility
- - $60,750; and 7,000 square foot facility - $24,500.
(3) Previous term lease with expiration date of
November 30, 1991, by mutual consent of the parties
extended from month to month at the same rental rate
and on substantially the same other terms applicable
during the term.
(4) Includes properties under two separate leases: 10
year lease executed June 1, 1987 for 17,500 square foot
plumbing and electrical sales facility at annual rental
of $62,900; and 10 year lease executed March 31, 1988
for 20,000 square foot sewer and water and construction
materials facility at annual rental of $70,000.
During the fiscal year ended January 28, 1994, the
Company and its subsidiaries also made rental payments
to Hughes, Inc. of approximately $187,382 for the use
of an aircraft belonging to Hughes, Inc.
Mr. Donald C. Martin, a member of the Board of
Directors of the Company, under the terms of the
Acquisition Agreement dated June 30, 1993, pursuant to
which the Company acquired Electrical Distributors,
Inc. ("EDI"), entered into a Consulting Agreement with
the Company and a Lease Agreement with respect to the
facilities occupied by EDI.
Under the Consulting Agreement, Mr. Martin provides
and will provide consulting services to the Company as
required for the five year period beginning on July 1,
1993 for annual compensation of $50,000. Under a
supplement to the Consulting Agreement, Mr. Martin
receives additional consulting compensation in the
amount of approximately $1,901 per month during the
period from August 1, 1993 through February 1, 1995.
The Company paid consulting fees to Mr. Martin under
the Consulting Agreement and the supplement of $62,008
during the last fiscal year.
Under the terms of the Lease Agreement, EDI leases
an approximately 32,780 square foot building with
approximately 60,000 square feet of outside parking and
storage space. The facility is located in Atlanta,
Georgia and is utilized by EDI as its sales outlet. The
Lease Agreement is for a term of five years at a rental
rate of $106,535 per year until July 1, 1995 and
$122,925 per year thereafter through June 30, 1998. EDI
pays for repairs other than structural repairs, real
estate taxes and insurance on the leased property.
During the lease period from June 30, 1993 through the
fiscal year end January 28, 1994, EDI made rental
payments to Mr. Martin of $53,268 and paid real estate
taxes and building insurance of $12,129 and $1,519,
respectively. Maintenance repairs paid for by EDI
during the period were not substantial and were, in the
opinion of management, normal for the type of facility
leased.
Prior to the acquisition of EDI by the Company on
June 30, 1993, Mr. Martin was not a director, officer
or stockholder of the Company. Mr. Martin was appointed
to the Board of Directors of the Company on August 24,
1993.
Mr. Robert N. Blackford, Secretary and a director
of the Company, is a member of the law firm of Maguire,
Voorhis & Wells, P.A., which serves as general counsel
to the Company.
The Company believes that the transactions
described above are at least as favorable to the
Company as those which could have been obtained from
unrelated parties.
Compliance with Section 16(a) of the Securities
Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of
1934 requires the Company's directors, executive
officers, and persons who own beneficially more than
ten percent of a registered class of the Company's
equity securities, to file with the Securities and
Exchange Commission (the "SEC") and the New York Stock
Exchange initial reports of ownership and reports of
changes in ownership of common stock and other equity
securities of the Company. Directors, executive
officers and greater than ten-percent shareholders are
required by SEC regulation to furnish the Company with
copies of all Section 16(a) reports they file.
To the Company's knowledge, based solely on review
of the copies of such reports furnished to the Company
and written representations that no other reports were
required, during the fiscal year ended January 28,
1994, its directors, officers and greater than
ten-percent beneficial owners complied with all
applicable Section 16(a) filing requirements.
APPROVAL OF AMENDMENT TO DIRECTORS' STOCK OPTION PLAN
Shareholders at the 1994 Annual Meeting will be
asked to consider and act upon the adoption of a
proposed amendment to the Company's Directors' Stock
Option Plan to require the granting of additional
options under the Plan to enhance its continued use as
an incentive program for nonemployee directors.
Currently, in the absence of expiration or termination
of presently outstanding options, no additional options
may be granted under the Plan unless an amendment is
approved by the shareholders to increase the number of
shares which will be subject to options under the Plan.
The Directors' Stock Option Plan was approved by
the shareholders at the 1989 Annual Meeting as an
incentive program to encourage nonemployee directors,
who are not eligible to participate in the Company's
other stock ownership or stock incentive plans (ESOP,
1988 Stock Option Plan, or Senior Executives' Incentive
Plan) which are available to employee directors, to
increase their stock ownership and proprietary interest
in the success of the Company, and to encourage them to
continue as directors of the Company.
The Plan, as approved by the shareholders at the
May 25, 1989 Annual Meeting, and as currently in
effect, has a maximum term of ten years and has
required the granting of options with respect to all of
the shares authorized under the Plan so that the final
such option was granted on May 25, 1993. Under the
terms of the Plan, the proposed amendment to the Plan
for the purpose of increasing the number of shares as
to which options may be granted, will extend the term
of the Plan as to such additional options, and the
granting of such additional options, until ten years
from the date such amendment is approved by the
shareholders or until the Plan, as amended, is sooner
terminated (without prejudice to any outstanding
options) by the Board of Directors. For purposes of
options outstanding under the Plan, the Plan shall
continue in effect until all outstanding options have
been exercised in full or are no longer exercisable.
The amendment proposed for approval by the
shareholders at the 1994 Annual Meeting would increase
from 60,000 to 135,000 shares, the number of shares
with respect to which options may be granted under the
Plan, thereby requiring the granting of options with
respect to 75,000 shares in addition to those options
with respect to 60,000 shares which are presently
outstanding under the Plan. The proposed amendment
would also extend the maximum term of the Plan from May
29, 1998 until May 24, 2003 and thereafter as required
with respect to outstanding options. A general summary
of the Plan as presently in effect and as proposed to
be amended is set forth below.
<TABLE>
The benefits or amounts that will be received by or
allocated under the plan as proposed to be amended are
set forth on the following table:
<CAPTION>
NEW PLAN BENEFITS
Directors' Stock Option Plan
As Proposed to be Amended(1)
Dollar Value Number of
Name and Position ($) Shares
<S> <C> <C>
All Current Executive
Officers(2) -0- -0-
All Current Directors
who are not Executive
Officers (3) 75,000
All Employees who are
not Executive Officers(2) -0- -0-
_______________________________
</TABLE>
(1) Does not include options already outstanding under
Directors' Stock Option Plan as presently in effect. No
additional shares remain available for options under
the Plan at this time.
(2) Only nonemployee directors are eligible as
participants under the Plan, none of whom are executive
officers of the Company.
(3) Options are granted at market value at the time of
the grant.
Summary of the Plan
Participants. The Plan provides that nonemployee
directors who are not employees of the Company or of
any of its subsidiaries on the date of the grant of an
option, and who have not within twelve months of such
grant date been employees of the Company, or of any
entity which at the time of such employment was a
subsidiary of the Company, will on such grant date be
participants under the Plan. On each of the grant dates
from the inception of the Plan on January 24, 1989
through the most recent grant date, May 25, 1993, each
of the Company's then four nonemployee directors were
participants under the Plan. Since May 25, 1993, two
additional nonemployee directors have been appointed to
the Board. Currently, each of the Company's six
nonemployee directors would qualify as a participant
under the Plan. If the amendment to the plan is
approved at the 1994 Annual Meeting and each of the
current nonemployee directors (two of whom are
nominees) remain in office, each such nonemployee
director will be granted an option for 2,500 shares at
the Board meeting immediately following the Annual
Meeting.
Shares. The number of shares of common stock which
may be subject to options under the Plan, as presently
in effect, is an aggregate of 60,000 shares, all of
which are presently subject to outstanding options,
and, therefore, no additional options may be granted
under the Plan other than options with respect to
shares previously subject to an option which expires or
is terminated following an optionee's termination of
service as a director. The proposed amendment would
make an additional 75,000 shares available for options
under the Plan. The additional shares will be
registered under the Securities Act of 1933 and listed
on the New York Stock Exchange.
The number of shares subject to options under the
Plan is subject to adjustment in the event of any
increase or decrease in the number of issued shares of
common stock resulting from a subdivision or
consolidation of shares, or the payment of a stock
dividend (but only on the capital stock), or any other
increase or decrease in the number of shares effected
without receipt of consideration by the Company.
Options. In accordance with the terms of the Plan,
as adopted and presently in effect, the Plan required
the granting of options with respect to an aggregate of
12,000 shares on January 24, 1989, the date of approval
of the Plan by the Board of Directors, and at the
meeting of the Board immediately following the 1990
Annual Meeting of Shareholders and at each Board
meeting immediately following each Annual Meeting of
Shareholders thereafter during the term of the Plan, so
that options with respect to all of the 60,000 shares
subject to the Plan had been granted with the grant of
options at the Board meeting immediately following the
1993 Annual Meeting of Shareholders. The options with
respect to the 60,000 shares were divided equally among
the four nonemployee directors in office on the grant
dates; Robert N. Blackford, Clifford M. Hames, Herman
B. McManaway, and John B. Ellis, each of whom holds
options for an aggregate of 15,000 shares.
The proposed amendment would require the granting
of additional options with respect to an aggregate of
75,000 shares. Options with respect to 15,000 of such
shares would be granted at the Board meeting
immediately following the 1994 Annual Meeting of
Shareholders. A subsequent grant of options for an
aggregate of 15,000 shares, or such lesser number of
shares as shall remain available for options under the
Plan, within the overall limitation that not more than
135,000 shares may be subject to options under the
Plan, will be made at each Board meeting immediately
following each Annual Meeting of Shareholders
thereafter during the term of the Plan. The grant of
options on each grant date shall be divided equally
among the Plan participants under the Plan on that
grant date.
Each option under the Plan is exercisable, in whole
or in part, on the date of the grant and will remain
exercisable while the participant is a nonemployee
director, for ten years from the date of the grant. In
the event a participant shall cease to be a nonemployee
director for any reason other than death, the
participant's option may be exercised at any time
within three months after termination of service as a
nonemployee director or until the expiration of the
option, whichever occurs first. In the event of a
participant's death while a nonemployee director, or
within three months after termination of service as a
nonemployee director, the participant's option may be
exercised by the executors or administrators of the
participant, or by any person or persons who shall have
acquired the option directly from the participant by
bequest or inheritance, for a period of one year from
the date of death of the participant, or until the
expiration of the option, whichever first occurs.
During the lifetime of the participant, such
participant's option shall be exercisable only by such
participant and such option shall not be transferable
by the participant other than by will or the laws of
descent and distribution.
The option price for options under the Plan must be
100 percent of the fair market value of the shares on
the date of the grant of the option. For purposes of
options under the Plan, the "fair market value" of the
shares shall be deemed to be the highest closing price
of the shares on the New York Stock Exchange on the day
the option is granted, or if no sale of shares of the
Company shall have been made on that day, on the next
preceding day on which there is a sale of such shares.
The fair market value of the shares on April 14, 1994
was $29.00 per share.
Payment of the option price upon exercise of
options under the Plan may be in cash or with shares of
common stock of the Company valued at fair market
value, as defined above, determined as of the date of
the exercise of the option.
Amendment of the Plan. The Board of Directors may,
from time to time, with respect to shares of common
stock at the time not subject to options under the
Plan, suspend, discontinue, revise or amend the Plan
without approval of the shareholders, provided,
however, no revision or amendment not approved by the
shareholders shall change the number of shares subject
to the Plan, extend the term of the Plan or the term of
any option granted under the Plan, change the
designation of the participants, the manner in which
options are granted, or materially increase benefits
under the Plan. The proposed amendment to the Plan,
because it would increase the number of shares subject
to the Plan and extend the term of the Plan, is subject
to the approval of the shareholders.
Administration of the Plan. The Plan is
administered by the Directors' Stock Option Plan
Committee which must consist of not less than three
members of the Board who are not employees of the
Company and who are "disinterested persons" as defined
in Securities and Exchange Commission Rule 16b-3.
Members of the Committee, as nonemployee directors, are
participants under the Plan. Currently, the members of
the Committee are Robert N. Blackford, John B. Ellis
and Herman B. McManaway. The Plan provides that the
interpretation and construction of the Plan by the
Committee shall be final unless otherwise determined by
the Board. Administration, interpretation and
construction of the Plan by the Committee is
essentially administrative in nature as the Plan
specifically identifies the participants, when and how
grants of options are made, the duration of the
options, the number of shares to be subject to options,
the exercise price and other significant terms of the
options.
Federal Income Tax Consequences. The options are
not "incentive stock options" as defined in Section
422A of the Internal Revenue Code and the favorable tax
treatment accorded to incentive stock options under the
Code is not available to holders of options under the
Plan. Participants receiving options under the Plan
will generally not be taxed upon the receipt of the
options as such options will not have a readily
ascertainable fair market value for federal income tax
purposes because the options are not transferable.
Moreover, upon the exercise of an option under the Plan
a participant will recognize ordinary income in an
amount equal to the excess of the fair market value of
the shares acquired over the exercise price under the
option only if such participant timely files the
written election described in Section 83(b) of the
Code, because the participant is subject to Section
16(b) of the Securities Exchange Act of 1934. An 83(b)
election must be filed in writing with the Internal
Revenue Service within 30 days of the date on which an
option is exercised. A participant who exercises an
option and does not file the 83(b) election will not
realize income on the date of exercise of the option,
but instead, will generally realize income six months
later (at the time the Section 16(b) restrictions
lapse) in an amount equal to the excess of the fair
market value on such later date over the option price
paid for the shares. At the time of any subsequent sale
or other disposition of the shares acquired upon the
exercise of an option, the shareholder will realize
capital gain (or loss) equal to the difference between
the amount received for the shares and the
shareholder's basis in the shares. The shareholder's
basis in the shares acquired upon the exercise of the
option will be equal to the sum of the option price
paid for the shares plus the amount of ordinary income
(or less the amount of any ordinary loss) recognized by
the shareholder in connection with the exercise of the
option. The gain or loss at the time of any such
subsequent sale or other disposition will be long term
or short term, depending upon the shareholder's holding
period for the shares.
The Company will not be entitled to a deduction for
federal income tax purposes for the granting of any
option under the Plan. The Company generally will be
entitled to a deduction for federal income tax purposes
when a participant realizes ordinary income as a result
of exercising an option under the Plan in the same
amount as the ordinary income realized by the
participant.
The foregoing is only a brief summary of the
applicable federal income tax consequences with respect
to options under the Plan and should not be relied upon
as being complete.
Vote Required for Approval of the Amendment to the
Directors' Stock Option Plan
Approval of the amendment to the Directors' Stock
Option Plan for nonemployee directors requires the
affirmative vote of the holders of at least a majority
of the outstanding shares of common stock represented
at and entitled to vote at the 1994 Annual Meeting.
The Board of Directors recommends a vote FOR
approval of the proposal to amend the Plan, and all
proxies will be voted in favor thereof unless a
contrary specification is made on the proxy by the
shareholder.
APPROVAL OF THE STOCK AWARD PROVISIONS OF THE
SENIOR EXECUTIVES' LONG-TERM INCENTIVE BONUS PLAN
FOR FISCAL YEAR 1996
Shareholders at the 1994 Annual Meeting of
Shareholders will also be asked to consider and act on
approval of the stock award provisions of the senior
executives' long-term incentive bonus plan for fiscal
year 1996 approved by the Board of Directors on August
24, 1993. Under the terms of the plan the Chief
Executive Officer, President (previously Executive Vice
President and currently President), and Chief Financial
Officer of the Company will receive an incentive bonus
if the Company achieves the required earnings per share
during the three fiscal year period beginning with the
Company's fiscal year ended January 28, 1994 and ending
with the fiscal year to be ended January 26, 1996.
Under the plan the participants would receive a
bonus, depending upon the Company's earnings for the
period, of from 25% to 100% of base salary for the
final year of the three year period. The required
levels of earnings for payments under the plan have
been recommended by the Compensation Committee and
approved by the Board of Directors to reward continued
growth in the Company's earnings per share. The bonus,
if any, earned under the plan would be paid 50% in cash
and 50% in shares of common stock of the Company
following the end of the 1996 fiscal year. The maximum
amount of any bonus which might be paid under the plan,
as estimated by management, would aggregate
approximately $529,200 for the three participants as a
group. The number of shares which might be issued under
the plan would be the number of shares, at the then
current fair market value, represented by 50% of the
estimated maximum bonus amount.
<TABLE>
The benefits or amounts that will be received by or
allocated under the plan are set forth in the following
table:
<CAPTION>
NEW PLAN BENEFITS
Senior Executives' Long-Term Incentive Bonus Plan
Dollar Value Number of
Name and Position ($) Shares
<S> <C> <C>
David H. Hughes
Chief Executive Officer $70,667(1) ---(2)
A. Stewart Hall, Jr.
President $59,000(1) ---(2)
All Current Executive
Officers $165,000(1) ---(2)
All Current Directors
who are not Executive
Officers -0- -0-
All Employees who are
not Executive Officers -0- -0-
</TABLE>
(1) Benefits, if earned, will be determined over the
three year period ending January 26, 1996 based upon
minimum required earnings per share for the period and
estimated base salary level for fiscal year of
performance period. See "Executive Compensation and
Other Information - Long-Term Incentive Plans - Awards
in Last Fiscal Year" in this Proxy Statement. Figures
shown in table above are amounts accrued for the fiscal
year ended January 28, 1994.
(2) If the plan is approved by the shareholders, 50% of
any award under the plan will be paid in shares of
common stock of the Company at the current market value
as of the end of the performance period. If the plan is
not approved by the shareholders any award under the
plan will be paid solely in cash.
The shares, if any, to be issued under the plan
will be registered under the Securities Act of 1933 if
such registration is determined, in the opinion of
management, to be required or advisable. The Company
also intends to seek listing of any such shares on the
New York Stock Exchange. Shareholder approval of the
stock award provisions of the plan is a requirement for
listing of such shares on the New York Stock Exchange.
In the event the shareholders do not approve the stock
award provisions of the plan, the Board of Directors
will amend the plan to provide that any bonus earned
will be paid 100% in cash and no shares will be issued
under the plan. Management of the Company believes that
the stock award provision makes the plan a more
effective incentive for improved performance by
increasing the participant's proprietary interest in
the Company and its long term prospects.
Vote Required for Approval of the Stock Award
Provisions of the Senior Executives Long-Term Incentive
Bonus Plan for Fiscal Year 1996.
Approval of the stock award provisions of the
senior executives long-term incentive bonus plan for
fiscal year 1996 will require the affirmative vote of
the holders of at least a majority of the shares
represented and entitled to vote at the 1994 Annual
Meeting.
The Board of Directors recommends a vote FOR
approval of the stock award provisions of the senior
executives long-term incentive bonus plan for fiscal
year 1996, and all proxies will be voted in favor of
thereof unless a contrary specification is made on the
proxy by the shareholder.
APPROVAL OF AMENDMENT TO ARTICLES OF INCORPORATION TO
INCREASE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
At the 1994 Annual Meeting shareholders will also
vote upon approval of an amendment to the Articles of
Incorporation to increase the number of authorized
shares of common stock to 20,000,000 shares. The
authorized common capital stock of the Company
presently consists of 10,000,000 shares of common
stock, $1.00 par value per share, and 10,000,000 shares
of preferred stock, no par value per share. As of March
25, 1994 there were 5,114,361 shares of the Company's
common stock issued and outstanding and 655,758 shares
reserved for issuance upon conversion of the Company's
then outstanding 7% Convertible Subordinated Debentures
due May 1, 2011 (the "Debentures") (called for
redemption and convertible until April 7, 1994), and
1,120,551 shares reserved for issuance under stock
option plans of the Company. None of the Company's
preferred stock is outstanding.
If the amendment to the Directors' Stock Option
Plan and the stock award provisions of the senior
executives' long-term incentive bonus plan for fiscal
year 1996, proposed for approval at the 1994 Annual
Meeting of Shareholders are approved, such plans will
require, respectively, the reservation of 75,000 and
8,820 additional shares of common stock. Assuming
conversion of all of the outstanding Debentures and
shareholder approval of the amendment to the Directors'
Stock Option Plan and the stock award provisions of the
bonus plan, the total authorized common stock remaining
available for other purposes would be 3,025,510 shares.
Whether or not all of such Debentures are converted
into common stock, or either or both of the stock
related plans are approved by the shareholders,
management believes it is advisable to amend the
Company's Articles of Incorporation to increase the
number of authorized shares of common stock in order to
have an adequate number of shares available for general
corporate purposes. Historically, the Company has
offered shares of its common stock for sale to raise
additional capital, offered its shares as consideration
for the acquisition of other companies, offered its
shares under the Company's stock option plans, and made
such shares available for grants under its other
compensation plans. The Company does not presently
propose any transaction which would require the
offering or utilization any of the shares of common
stock which would be authorized by the proposed
amendment to the Articles of Incorporation.
Shares of common stock of the Company are not
subject to preemptive rights and, therefore,
shareholders of the Company will not have preemptive
rights to subscribe for the additional shares which
would be authorized by the amendment to the Articles of
Incorporation to be proposed for approval at the Annual
Meeting.
The shares authorized by the amendment will be
subject to issuance within the discretion of the Board
of Directors for such consideration as the Board shall
deem appropriate. Issuance of any additional shares by
the Company would result in the dilution of the voting
power and earnings per share, and, depending upon the
consideration to be received for the shares, could
result in a dilution of the book value per share.
All of the currently outstanding shares are, and
any additional shares which become outstanding will be,
subject to the rights under the shareholder rights plan
which was adopted by the Company on May 17, 1988. Under
the plan, which was adopted to discourage unilateral
actions by potential acquirers in the absence of
negotiations with the Company's Board of Directors, one
shareholder right for the purchase, under specified
conditions, of certain securities of the Company is
attached to each share of common stock. A further
description of the plan is included in Note 7 of the
Notes to Consolidated Financial Statements in the
Company's Annual Report to Shareholders which
accompanies this Proxy Statement.
Vote Required for Approval of the Amendment to the
Articles of Incorporation to Increase the Number of
Authorized Shares of Common Stock
Approval of the amendment to the Articles of
Incorporation to increase the number of authorized
shares of common stock requires the affirmative vote of
the holders of at least a majority of the outstanding
shares of common stock entitled to vote at the 1994
Annual Meeting.
The Board of Directors recommends a vote FOR
approval of the amendment to the Articles of
Incorporation to increase the number of authorized
shares of common stock, and all proxies will be voted
in favor thereof unless a contrary specification is
made on the proxy by the shareholder.
OTHER BUSINESS
Management knows of no business which will be
presented for action at the meeting other than as set
forth in this Proxy Statement, but if any other matters
properly come before the meeting, it is the intention
of the persons named in the accompanying proxy to vote
such proxy on such matters in accordance with their
best judgment.
Shareholder Proposals
Proposals of shareholders intended to be presented
at the 1995 Annual Meeting of Shareholders must be
received by the Company, for possible inclusion in the
Company's Proxy Statement and form of proxy relating to
that meeting, not later than January 6, 1995.
Shareholder proposals should be made in compliance with
applicable legal requirements and be furnished to the
President by certified mail, return receipt requested.
Independent Accountants
The firm of Coopers & Lybrand served as the
Company's independent auditors for the fiscal year
ended January 28, 1994. Representatives of Coopers &
Lybrand are expected to be present at the Annual
Meeting of Shareholders, where they will have an
opportunity to make a statement if they desire to do
so, and will be available to respond to appropriate
questions. The firm of Coopers & Lybrand was selected
by the Board of Directors upon the recommendation of
the Audit Committee of the Board during the fiscal year
ended January 28, 1994, to serve as the Company's
auditors for that fiscal year. As of the date of this
Proxy Statement, the Company has not engaged its
auditors for the fiscal year to be ended January 27,
1995.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY;
THEREFORE, SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE
1994 ANNUAL MEETING IN PERSON ARE REQUESTED TO FILL IN,
SIGN AND RETURN THE PROXY FORM AS SOON AS POSSIBLE.
By Order of the Board of Directors,
Robert N. Blackford, Secretary
Orlando, Florida
April 18, 1994
HUGHES SUPPLY, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS
The undersigned shareholder of HUGHES SUPPLY,
INC. (the "Company"), revoking previous proxies,
acknowledges receipt of the Notice of Annual Meeting of
Shareholders and Proxy Statement dated April 18, 1994,
and hereby appoints DAVID H. HUGHES, ROBERT N.
BLACKFORD and VINCENT S. HUGHES, and each of them, the
true and lawful attorneys and proxies of the
undersigned, with full power of substitution and
revocation, to attend the Annual Meeting of
Shareholders of the Company to be held at Sun Bank
Center, Park Building, Sun Room, Third Floor, 200 South
Orange Avenue, Orlando, Florida, on Tuesday, May 24,
1994, at 10:00 a.m., local time, and at any adjournment
or adjournments thereof, with all powers the
undersigned would possess if personally present. The
undersigned authorizes and instructs said proxies to
vote all of the shares of stock of the Company which
the undersigned would be entitled to vote if personally
present as follows:
(To be Signed on Reverse Side)
X
Please mark your votes as in this example.
FOR WITHHELD
FOR AGAINST ABSTAIN
1. Election of
Directors
For, except vote withheld from the following
nominee(s):
Class I (Term of Office will expire May, 1997)
Nominees: Robert N. Blackford
A. Stewart Hall, Jr.
Russell V. Hughes
Donald C. Martin
Class II (Term of Office will expire May, 1995)
Nominees: John D. Baker II
2. Approval of Amendment to Directors' Stock Option
Plan
3. Approval of Stock Award Provisions of Senior
Executives' Long-Term Incentive Bonus Plan for Fiscal
Year 1996
4. Approval of Amendment to Articles of Incorporation
to Increase Authorized shares of Common Stock
This Proxy, when properly executed, will be voted in
the manner directed herein by the undersigned
shareholder. If no direction is made, this Proxy will
be voted FOR the election of each of the nominees as
directors and for approval of items 2, 3 and 4 above.
The Board of Directors favors a vote FOR such election
and FOR approval of each of such items.
SIGNATURE(S)___________________________________________
_________________________DATE________________
NOTE: Please sign exactly as name appears hereon. Joint
owners should each sign. When signing as attorney,
executor, administrator, trustee or guardian, please
give full title as such.
