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:
[X] Preliminary Proxy Statement
[ ] 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):
[X] $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:
________________________________________________
<PAGE>
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 Direc-
tors,
Robert N. Blackford, Secretary
Orlando, Florida
April 15, 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.
<PAGE>
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 15, 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 share-
holders.
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 con-
tinues 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 nominees 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, Positions Principal Occupation Shares of Stock
and Offices Held with and Business Beneficially Percent
the Company Experience for Past Served as Owned as of of
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,
Director(1)(2)(3)(4) P.A.
(5)(6)
*A. Stewart Hall, Jr. President of the March, 1994 59,296(9) 1.2(8)
51, President, Director Company (March, (10)
1994-Date); Executive
Vice President of the
Company (January
1988-March, 1994)
*Russell V. Hughes, Vice President of May, 1964 102,670(9)
68, Vice President, the Company (10)(12) 2.0(8)
Director(1)(11)
*Donald C. Martin, Consultant to the August, 1993 271,897 5.3(8)
57, Consultant, Company (July, 1993-
Director(4)(6)(13) 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 1989-Date)
(1)(3)(4)(6)
Herman B. Retired (January, October, 1985 27,000(7) --(8)
McManaway, 68, 1988-Date)
Director (2)(3)(6)(15)
<CAPTION>
Directors Class III
Term of Office Expires: May, 1996
<S> <C> <C> <C> <C>
John B. Ellis, 69, Retired (January, November, 1986 22,000(7) --(8)
Director(2)(4)(6)(16) 1986-Date
David H. Hughes, 50 Chairman of the August, 1968 332,986(9)
Chairman of the Board and Chief (10)(12)(18) 6.5(8)
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, 53, Vice President of April, 1986 333,015(9)
Vice President, the Company (10)(12)(18) 6.5(8)
Director (1)(11)
</TABLE>
_______________________________
* Nominee for election as a director in Class I at the 1994
Annual Meeting; present term of office as a director expires
on May 24, 1994.
**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 on May 24, 1994.
(1) Member Executive Committee.
(2) Member of Directors' Stock Option Plan Committee.
(3) Member of Audit Committee.
(4) Member 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; Herman B. McManaway,
15,000; Clifford M. Hames, 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 which have been deemed outstanding for the purpose of
computing his percentage. Figures 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 as 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, 61,908; 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.
(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) 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.
<PAGE>
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 manage-
ment 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
Donald C. Martin
5180 Peachtree Road
Atlanta, Georgia 271,897 Shares(4) 5.3
SunTrust Banks, Inc.
25 Park Place, N.E.
Atlanta, Georgia 733,272 Shares(5) 14.3
The Employers'
Retirement Plan of
Consolidated Electrical
Distributors, Inc. 577,467 Shares(6) 11.3
FMR Corp.
82 Devonshire Street
Boston, Massachusetts 336,800 Shares(7) 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 01, 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 01, 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) 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.
(5) 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; and 28,565 shares held in
the David H. Hughes Generation Skipping Trust. Also excludes
4,122 shares and 2,713 shares, respectively, held for the
accounts of David H. Hughes and Vincent S. Hughes in the ESOP
by Trust Company Bank, as trustee. See Notes (2) and (3)
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, the Company's Cash or Deferred Profit
Sharing Plan and Employee Stock Ownership Plan.
(6) 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 of
577,467 shares, including 320,025 shares held by the Plan and
affiliated entities and 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.
(7) 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. 28,504(3) __(2)
Kenneth A. Stephen 25,308(4) __(2)
All Directors and
Officers as a Group
(13 persons)(1) 1,099,141(5) 20.4(9)
(6)(7)(8)
</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 26,070
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 investment power with
respect to 26,070 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 210,477 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 872,358 shares, shared
voting power with respect to 226,783 shares, sole investment
power with respect to 856,942 shares and shared investment
power with respect to 242,199 shares.
(9) Calculated on the basis of 5,384,838 shares, including
5,114,361 shares of the Company's common stock outstanding and
270,477 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.
<PAGE>
Family Relationships Between Certain Directors
The following family relationships exist between directors of
the Company:
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 three 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. 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. John D. Baker II was first appointed as a nonemployee
director on March 24, 1994 and did not receive any directors 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.
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.
<PAGE>
<TABLE>
<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.
Name Information About Executive Officers
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.
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 ___ 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.
John B. Ellis, Robert N. Blackford and Clifford M. Hames served as
members of the Committee throughout the last fiscal year. 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 with respect to 50%
of any bonus earned under the plan.
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- ----------
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- ----------
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- ----------
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- ----------
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- ----------
Vice President 1993 99,640 25,000 -0- -0- -0- 29,050
1992 95,000 10,000 -0- 20,000
</TABLE>
________________________
(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.
<PAGE>
<TABLE>
<CAPTION
Executive Fiscal Insurance SERP Matching ESOP LTIP
Year Premium Contribution Contribution
<S> <C> <C> <C> <C> <C> <C>
David H. 1994 $ 696 $38,277 $_______ $11,948(a) $70,667
Hughes 1993 696 26,920 2,340 -0- -0-
A. Stewart 1994 1,152 46,598 _______ 7,057(a) 59,000
Hall, Jr. 1993 696 32,755 2,250 -0- -0-
Vincent S. 1994 1,152 26,627 _______ 7,778(a) -0-
Hughes 1993 1,152 27,504 1,495 -0-
Jasper L. 1994 1,152 24,963 _______ 7,091(a) -0-
Holland, Jr. 1993 1,152 24,336 1,720 -0- -0-
Kenneth H. 1994 1,152 26,627 _______ 6,442(a) -0-
Stephens 1993 1,152 27,504 394 -0- -0-
</TABLE>
(a) Contribution estimated as named person's prorata plan
interest, as last calculated by the plan trustee, applied to
the Company's aggregate contribution of $500,000 for the
fiscal year ended January 28, 1994.
Long-Term Incentive Plans - Awards in Last Fiscal Year
The following table provides information concerning incentive
awards made during fiscal 1994 under the Company's senior
executives' long-term incentive bonus plan for the fiscal year
1996 to the Company's Chief Executive Officer and the only other
participant under the plan who is among the Company's other four
most highly compensated executive officers. There is one
additional participant under the plan. Each award represents the
right to receive an amount in cash and stock if, and only if,
consolidated fully diluted earnings per share for the three year
period ending January 26, 1996 equal or exceed certain levels
which have been set by the Board of Directors upon the
recommendation of the Compensation Committee. If fully diluted
earnings per share falls between the threshold level and the
maximum level, then the amount of the award is prorated
accordingly. Payments made under the long-term program are
reported in the Summary Compensation Table in the year of payout.
<PAGE>
<TABLE>
<CAPTION>
Estimated Future Payouts under Non-Stock
Price-Based Plans
________________________________________
Performance or
Number of Other Period
Shares Until Maturation Threshold Target Maximum
Name (#) or Payout ($) ($) ($)
<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 compensa-
tion paid under the Company's other benefit programs. Supplemen-
tal 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 to 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 admini-
strative 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 $500,000
was made by the Company to the ESOP for the fiscal year ended
January 28, 1994.
1988 Stock Option Plan
The Company's 1988 Stock Option Plan presently authorizes the
granting of options, in addition to those presently outstanding,
for the purchase up to 755,358 shares of the Company's common
stock to key executive, management, and sales employees. Under
the Plan, options may be granted at prices not less than market
value on the date of grant, but prices for incentive stock options
granted to employees who own more than 10% of the Company's common
stock are at least 110% of such market value. Options may be
granted from time to time through May, 1998, such options may be
exercisable for up to 10 years from the date of grant, except in
the case of employees owning more than 10% of the Company's common
stock, for whom incentive stock options may be exercisable only up
to 5 years from the date of grant. The Plan permits the granting
of both incentive stock options and nonincentive stock options and
the granting of options with cash surrender rights comparable to
stock appreciation rights ("SAR's"). No options have been granted
under the Plan as nonincentive stock options or as options with
SAR's. No options were granted to any of the executive officers
of the Company during the last fiscal year.
<PAGE>
Aggregate Option/SAR Exercises in Last Fiscal Year and Fiscal
Year-end Option/SAR Values
The following table summarizes options and SARs exercised
during the fiscal year ended January 28, 1994 and presents the
value of unexercised options and SARs held by the named executives
at fiscal year end.
<TABLE>
<CAPTION>
Value of
Number of Unexercised
Unexercised In-the-Money
Options at Options at
Shares January 28, 1994 January 28, 1994
Acquired Value (#) ($)
on Exercise Realized Exercisable (E)/ Exercisable (E)/
Name (#) ($) Unexercisable (U) Unexercisable (U)
<S> <C> <C> <C> <C>
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 distrib-
uted to participants upon their death or retirement. For partici-
pants 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
HughesSupply 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
Willcox & 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 2 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 2 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.
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 Com-
pany, 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)
Name and Position Dollar Value Number of
($) 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 ___, 1994 was $_______ 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 ministerial 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.
THE STOCK AWARD PROVISIONS OF THE APPROVAL
OF 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
$529,200 for the three participants as a group. The number of
shares which might be issued under the plan would be the number of
shares, at the then current fair market value, represented by 50%
of the estimated maximum bonus amount.
The benefits or amounts that will be received by or allocated
under the plan are set forth in the following table:
<PAGE>
<TABLE>
<CAPTION>
NEW PLAN BENEFITS
Senior Executives' Long-Term Incentive Bonus Plan
Name and Position Dollar Value Number of
($) 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.
<PAGE>
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
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 Company's 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.
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 accom-
panying 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 15, 1994
<PAGE>
HUGHES SUPPLY, INC.
Orlando, Florida
PROXY-ANNUAL MEETING OF SHAREHOLDERS THIS PROXY IS SOLICITED ON
May 24, 1994 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 15, 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:
1. Election of Directors
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
(MARK ONLY ONE)
[ ] VOTE FOR all nominees listed above, except
vote withheld from the following nominee (if
any).
__________________________________________
[ ] VOTE WITHHELD from all nominees
<PAGE>
2. Approval of Amendment to Directors' Stock Option Plan
[ ] VOTE FOR approval
[ ] VOTE AGAINST approval
[ ] ABSTAIN from voting
3. Approval of Stock Award Provisions of Senior Executives'
Long-Term Incentive Bonus Plan for Fiscal Year 1996
(MARK ONLY ONE)
[ ] VOTE FOR approval
[ ] VOTE AGAINST approval
[ ] ABSTAIN from voting
4. Approval of Amendment to Articles of Incorporation to
Increase Authorized Common Stock
(MARK ONLY ONE)
[ ] VOTE FOR approval
[ ] VOTE AGAINST approval
[ ] ABSTAIN from voting
5. In their discretion, upon such other business as may
properly come before the meeting or any adjournment thereof.
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.
_______ ______________________________
No. of
Shares
______________________________
Signature(s) of Shareholder(s)
Dated __________________, 1994
HUGHES SUPPLY INC.
PROXY COMMITTEE
c/o American Stock
Transfer & Trust Co.
40 Wall Street 46th Floor
New York, NY 10005
IMPORTANT: Please date this
proxy and sign exactly as
name(s) appear hereon. If
stock is held jointly, signa-
tures should include both
names. Executors, administra-
tors, trustees, guardians, and
others signing in a represen-
tative capacity should give
full titles.
PLEASE RETURN IN STAMPED ENVELOPE ENCLOSED.
