SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN
PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the registrant [ ]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
KNAPE & VOGT MANUFACTURING COMPANY
(Name of registrant as specified in its charter)
KNAPE & VOGT MANUFACTURING COMPANY
(Name of person(s) filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(l)(ii), 14a-6(i)(l), 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:
(4) Proposed maximum aggregate value of transaction:
[ ] 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>
Knape & Vogt Manufacturing Company
2700 Oak Industrial Drive, N.E.
Grand Rapids, Michigan 49505
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
October 18, 1996
The Annual Meeting of Shareholders of Knape & Vogt Manufacturing Company
will be held at the office of the Company, 2700 Oak Industrial Drive, N.E.,
Grand Rapids, Michigan, on Friday, October 18, 1996, at 1:30 p.m., local time,
for the following purposes:
1. To elect four persons to the Board of Directors for terms expiring
in 1999.
2. To transact such other business as may properly come before the
meeting.
Shareholders of record at the close of business August 30, 1996, will be
entitled to vote at the meeting or any adjournment thereof.
Dated: September 16, 1996
Grand Rapids, Michigan.
Richard C. Simkins
Secretary
<PAGE>
Dated: September 16, 1996
KNAPE & VOGT MANUFACTURING COMPANY
2700 Oak Industrial Drive, N.E., Grand Rapids, MI 49505
PROXY STATEMENT
For Annual Meeting of Shareholders
To Be Held October 18, 1996
SOLICITATION OF PROXIES FOR ANNUAL MEETING
This Proxy Statement is furnished to the shareholders of Knape & Vogt
Manufacturing Company in connection with the solicitation by the Board of
Directors of proxies to be used at the Annual Meeting of Shareholders which
will be held at the office of the Company, 2700 Oak Industrial Drive, N.E.,
Grand Rapids, Michigan, on October 18, 1996, at 1:30 p.m., local time. The
Annual Meeting is being held for the purpose of electing four directors.
If a proxy in the form distributed by the Company's Board of Directors
is properly executed and returned to the Company, the shares represented by
the proxy will be voted at the Annual Meeting of Shareholders and at any
adjournment of that meeting. Where shareholders specify a choice, the proxy
will be voted as specified. If no choice is specified, the shares represented
by the proxy will be voted for the election of the nominees named by the Board
of Directors.
A proxy may be revoked prior to its exercise by delivering a written
notice of revocation to the Secretary of the Company, executing and delivering
a proxy of a later date or attending the meeting and voting in person.
Attendance at the meeting does not, however, automatically serve to revoke a
proxy.
Holders of the Company's Common Stock should complete an accompanying
white proxy, and holders of the Company's Class B Common Stock should complete
an accompanying blue proxy.
<PAGE>
VOTING SECURITIES AND PRINCIPAL SHAREHOLDERS
On August 30, 1996, the record date for determination of the shareholders
entitled to vote at the Annual Meeting, there were outstanding 3,332,750
shares of Common Stock of the Company, each having one vote per share and
2,548,619 shares of Class B Common Stock, each having ten votes per share.
The shares of Class B Common Stock are limited in their transferability but
are convertible on a share-for-share basis into Common Stock. The Common Stock
is entitled to elect, as a class, one quarter (rounded up) of the directors
to be elected at each election of directors. The Common Stock and the Class B
Common Stock vote together in the election of the remaining director nominees.
Shares cannot be voted unless the shareholder is present at the meeting or
represented by proxy.
The following table sets forth, as of July 31, 1996, information
concerning persons known to management who may be deemed to be the beneficial
owners of more than five percent of either class of the Company's stock.
<TABLE>
Name and Address Amount and Nature Percent of Percent
of Beneficial Owner of Beneficial Each Class of Common
Ownership of Stock Equity
Common Class B Common Class B
<S> <C> <C> <C> <C> <C>
Knape & Vogt Manufacturing --- 304,425(1) -- 11.94% 5.18%
Company Profit Sharing Plan
and Knape & Vogt Manufacturing
Company Pension Plan
2700 Oak Industrial Drive, N.E.
Grand Rapids, MI 49505-6083
Raymond E. Knape 15,750(2) 139,623(2) .47% 5.48% 2.64%
727 Plymouth Blvd., S.E.
Grand Rapids, MI 49506
Dimensional Fund 313,170(3) --- 9.40% --- 5.33%
Advisors, Inc.
1299 Ocean Avenue
Santa Monica, CA 90401
</TABLE>
(1) 304,425 shares of Class B Common Stock are held by Comerica Bank, as
trustee of the Company's pension and profit sharing plans, of which
Allan E. Perry, Richard C. Simkins, William R. Dutmers, John E. Fallon
and Robert T. Kroon, as the members of the Profit Sharing and Pension
Committee, share voting and dispositive power.
(2) Includes 9,750 shares of Common Stock as to which Mr. Knape has the right
to acquire beneficial ownership under options exercisable within 60 days.
Mr. Knape has 5,169 shares of Common Stock and 17,446 shares of Class B
Common Stock with respect to which Mr. Knape holds exclusive voting and
dispositive power under trust and power of attorney, but in which
Mr. Knape has no financial interest. Mr. Knape has 831 shares of Common
Stock and 66,285 shares of Class B Common Stock held by Comerica Bank,
as trustee of the Company's profit sharing plan, of which Mr. Knape has
sole voting and dispositive power. Mr. Knape directly owns 55,892 shares
of Class B Common Stock.
(3) Information provided by Dimensional Fund Advisors, Inc. ("Dimensional")
indicates that Dimensional has sole voting power as to 203,640 shares of
Common Stock and sole dispositive power as to 313,170 shares of Common
Stock.
<PAGE>
Eight of the Company's directors, Mary Rita Cuddohy, William R. Dutmers,
John E. Fallon, Herbert F. Knape, Raymond E. Knape, Richard S. Knape,
Michael J. Kregor and Robert T. Kroon are related. They are grandchildren
or great grandchildren of the Company's founder, John Knape (1863-1914).
John Knape had seven children and these individuals, their families and their
descendants (the "Knape Family") at July 31, 1996, owned approximately
2,127,648 shares (84%) of the outstanding Class B Common Stock and 132,700
shares (4%) of the outstanding Common Stock, for approximately 74% of the
total voting power of the Company. Knape Family members owning approximately
70% of the Company's outstanding Class B Common Stock have an understanding
that before taking any significant action with regard to their Company stock,
they will consult with one or more of the directors of the Company and inform
such director or directors of their proposed action and reasons for such
action. This understanding among Knape Family members, coupled with the fact
that six of the seven branches of the Knape Family are represented on the
Board of Directors, could result in the Knape Family members taking a united
position in response to attempts to acquire control of the Company through
tender offers or proxy contests and, accordingly, could result in the Knape
Family members effectively blocking any such attempts. However, there is no
assurance that such united action would be taken.
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following table shows, as of July 31, 1996, the number of shares
beneficially owned by each of the Named Executives in the executive
compensation tables of this proxy statement and by all directors and executive
officers of the Company as a group.
<TABLE>
Percent
Name and Address Amount and Nature of Percent of Each of Common
of Beneficial Owner Beneficial Ownership Class of Stock Equity
Common(1) Class B Common Class B
<S> <C> <C> <C> <C> <C>
Raymond E. Knape 15,750 139,623(2) * 5.48% 2.64%
Allan E. Perry 15,950 --- * * *
Richard C. Simkins 25,420 877 * * *
Michael G. Van Rooy 7,700 --- * * *
Anthony R. Taylor 4,650 --- * * *
All executive
officers and
directors as
a group
(14 persons) 243,636 543,291 7.31% 21.32% 13.38%
* Denotes ownership of less than one percent.
</TABLE>
(1) This table includes the following shares of Common Stock subject
to acquisition within sixty (60) days pursuant to the exercise
of outstanding stock options: Raymond E. Knape - 9,750 shares;
Allan E. Perry - 12,500 shares; Richard C. Simkins - 24,104 shares;
Michael G. Van Rooy - 7,700 shares; and Anthony R. Taylor - 4,650
shares.
(2) For a description of the nature of Mr. Knape's share ownership,
see Note (2) under the caption "Voting Securities and Principal
Shareholders."
<PAGE>
DIRECTORS AND NOMINEES
The Company's Articles of Incorporation provide for the division of the
Board of Directors into three classes of nearly equal size with staggered
three-year terms of office. Four persons have been nominated for election to
the Board to serve three-year terms expiring at the 1999 Annual Meeting of
Shareholders. The Board of Directors has nominated the following persons for
election to the Company's Board of Directors: Mary Rita Cuddohy to be elected
by the Common Stock voting as a class, and William R. Dutmers, Richard S.
Knape and Michael J. Kregor, to be elected by the Class B Common Stock and
Common Stock voting together as a class.
Holders of Common Stock should complete the accompanying white proxy, and
holders of Class B Common Stock should complete the accompanying blue proxy.
Unless otherwise directed by a shareholder's proxy, it is intended that the
votes cast upon exercise of proxies in the form accompanying this statement
will be in favor of electing the nominees as directors, all of whom are
presently serving as directors. The following pages of this Proxy Statement
contain more information about the nominees.
A plurality of the votes cast at the Annual Meeting is required to elect
the nominees as directors of the Company. As such, the individual who receives
the greatest number of votes cast by the holders of the Company's Common
Stock, voting as a class, will be elected as a director, and the three
individuals who receive the greatest number of votes cast by the holders of
Common Stock and Class B Common Stock, voting together, will be elected as
directors. Shares not voted at the meeting, whether by abstention, broker
nonvote, or otherwise, will not be treated as votes cast at the meeting. Votes
cast at the meeting and submitted by proxy will be tabulated by the Company.
If any nominee becomes unavailable for election due to circumstances not
now known, the accompanying proxy will be voted for such other person to
become a director as the Board of Directors selects. The Board of Directors
recommends a vote FOR the election of all of the persons nominated by the
Board.
<PAGE>
The content of the following table is based upon information furnished
to the Company by the directors and nominees as of July 31, 1996.
<TABLE>
Principal
Occupation
(for more
than 5 Year Percent
years unless First of
otherwise Became Common Class Class Common
Name Age noted) Director (1) B Common B Equity
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Nominees for
Election as
Directors for
Terms Expiring
in 1999
--------------
Nominees for
Election by
Holders of
Common Stock and
Class B Stock
William R. 39 President, 1996 2,050 500 * * *
Dutmers(E) G & L, Inc.
Business
Consulting
Muskegon,
MI(2)
Richard S. 70 Private 1986 2,178 45,625(3) * 1.79% *
Knape(A) Investor
(D) Grand Rapids,
MI(3)
Michael J. 44 Vice 1996 2,189 10,619 * * *
Kregor President,
National
Sales,
Griffith
Laboratories,
Alsip, IL(4)
Nominee for
Election by
Holders of
Common Stock
Mary Rita 78 Private 1985 --- 96,409 * 3.78% 1.64%
Cuddohy(C) Investor
(D) Franklin, MI
Directors Whose
Terms Expire
in 1997
John E. 73 Private 1969 --- 107,710 * 4.23% 1.83%
Fallon(B)(C) Investor
(D)(E) Grand Rapids,
MI
Robert T. 65 Private 1985 --- 81,714(5) * 3.21% 1.39%
Kroon(B) Investor
(D)(E) Grand Rapids,
MI(5)
Allan E. 56 President 1990 15,950 --- * * *
Perry(A)(E) and Chief
Executive
Officer of
the Company
Directors Whose
Terms Expire
in 1998
Raymond E. 64 Former 1964 15,750(6) 139,623(6) * 5.48% 2.64%
Knape(C) Chairman and
Chief Executive
Officer of the
Company(6)
<PAGE>
Herbert F. 73 President, 1969 --- 60,214 * 2.36% 1.02%
Knape(A) Knape
(B)(C)(D) Industries,
Inc.,
Industrial
Finishes
Rockford, MI
Richard C. 53 Executive 1993 25,420 871 * * *
Simkins(E) V.P., CFO
Secretary and
Treasurer
*Denotes ownership of less than one percent.
</TABLE>
(A) Member Executive Committee
(B) Member Audit Committee
(C) Member Nominating Committee
(D) Member Executive Compensation Committee
(E) Member Profit Sharing and Pension Committee
(1) This table includes the following shares of Common Stock subject to
acquisition within 60 days by the exercise of outstanding stock options:
Raymond E. Knape - 9,750 shares, Allan E. Perry - 12,500 shares, and
Richard C. Simkins - 24,104 shares.
(2) William R. Dutmers was elected to the Board of Directors on April 19,
1996. Mr. Dutmers is President of G & L, Inc., a business consulting
firm and has held that position since 1991. Mr. Dutmers was also
president and owner of G & L Restaurants from 1986 until 1995, when
he sold the company.
(3) Richard S. Knape's shares include 25,219 shares of Class B Common Stock
owned by members of the Richard S. Knape family as to which he disclaims
beneficial ownership.
(4) Michael J. Kregor was elected to the Board of Directors on April 19,
1996. Mr. Kregor is Vice President--National Sales of Griffith
Laboratories, a position he started in 1996. From 1987 to 1996,
Mr. Kregor held various vice presidential positions in the marketing
and sales area at Nestle.
(5) Robert T. Kroon's shares include 27,563 shares of Class B Common Stock
owned by members of Robert T. Kroon's family as to which he disclaims
beneficial ownership.
(6) Raymond E. Knape retired from Knape & Vogt Manufacturing Company after
32 years as an officer and director and had held the position as Chairman
and CEO since 1985. For a description of the nature of Raymond E. Knape's
share ownership, see Note (2) under the caption "Voting Securities and
Principal Shareholders."
<PAGE>
The Board of Directors, which had six meetings in the last fiscal year,
has a standing Audit Committee, Nominating Committee and an Executive
Compensation Committee. The responsibilities of the Audit Committee, which
met four times in the last fiscal year, include making recommendations on the
choice of independent public accountants and reviewing financial matters with
such accountants, internal auditors, and management. The Nominating Committee,
which met once during the last fiscal year, selects and presents to the Board
of Directors candidates for election to fill vacancies on the Board. The
Committee will consider nominees recommended by shareholders, provided
recommendations are submitted in writing, including a description of the
proposed nominee's qualifications and other relevant biographical data, to
Mary Rita Cuddohy (chairperson of the committee) at 2700 Oak Industrial Drive,
N.E., Grand Rapids, Michigan 49505. The Executive Compensation Committee met
five times during the last fiscal year. The Committee makes recommendations
to the Board of Directors relating to compensation matters and fringe benefits
for officers and participants in the supplemental executive retirement, bonus,
and stock option plans.
Directors who are not employees of the Company are compensated at the
rate of $2,500 for each Board meeting attended and $1,250 for each Committee
meeting held at times other than immediately preceding or subsequent to a
Board meeting. Directors are also reimbursed for out-of-pocket expenses
incurred in attending meetings.
All directors attended at least three-fourths of the aggregate number of
meetings of the Board and Board committees which they were eligible to attend.
COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Board's Executive Compensation Committee is made up of five
nonemployee members of the Board of Directors. Its function is to investigate
and recommend to the Board the base pay, short-term incentive bonuses, and
long-term (stock option) incentives payable by the Company based on Company
and executive performances for the last completed fiscal year. The Committee
also recommends the annual rate of Company contribution to the Profit Sharing
Retirement Plan Trust and the nomination of new employees to participate in
the Supplemental Executive Retirement Plan.
The goals of the compensation plan are to apply a consistent policy of
compensation to all employees, to pay competitive base pay to attract and
retain executive officers who contribute to the long-term success of the
Company and to design and implement both short- and long-term incentive
programs to reward individual contributions to Company performance and
success.
A substantial portion of the annual compensation of each officer must
relate to, and be contingent on, the performance of the Company. Outstanding
performance, measured in terms of profit growth and total shareholder return,
should generate rewards for senior executives and key employees.
Competitive Base Rates
The Company is committed to providing a competitive base pay to help
attract and retain the best people in the industry. To ensure that base
salaries are competitive, local and national association annual reports,
as well as special individual position data and total compensation reports
by management consultants, are utilized annually. The goal is to ensure that
the base salaries of the Company's executives compare favorably with
executives with similar responsibilities in like companies in comparable
industries.
Formal job descriptions outlining the duties, basic functions and basic
and peripheral responsibilities of each executive position are utilized
in placing each in the salary ranges, and the individuals' relative
responsibilities and annual performances are used to adjust specific base
salary.
<PAGE>
Typically, the CEO and senior executives' salary recommendations include
a review and discussion of the executives' individual performance, and the
relationship to the Company's performance for the last fiscal year. These
include meeting strategic and business plan goals, operating profit,
performance relative to competitors, and timely new product introductions.
Individual performance is evaluated according to organizational and management
development and the fostering of teamwork and Company values.
The Executive Compensation Committee met five times during the 1996
fiscal year. These meetings dealt with management succession and the major
corporate reorganization as well as compensation matters. Base salary
considerations were adjusted primarily on the basis of new or expanded
responsibilities of the management team.
Performance-Based Incentives
Since 1987, the Company has rewarded its officers and managers, as well
as those of its subsidiaries, with an annual short-term incentive bonus based
on the attainment of sales and profit objectives. This bonus is calculated by
a formula which rewards executives according to the degree that the Company
achieves target goals of return on shareholders' equity and on sales growth
percentage. The formula is designed to recognize each executive's position of
responsibility for and contribution to meeting or exceeding the targets. The
incentive bonus is calculated monthly and calculations are reviewed by
executives and the Executive Compensation Committee. The short-term incentive
bonus is paid at the completion of the fiscal year based on year-end results.
The Committee reviews the formula targets and percentages yearly for
appropriateness and individual executives in the plan. Similar plans,
administered by management, cover nonsenior executives and general employees
under a Cash Profit Sharing Bonus Plan.
Short-Term Incentive
The Company's Mission Statement sets goals of 10% annual growth in sales
and a 15% return on equity. The formula for computing an executive's short-
term incentive bonus is based on both of these objectives, whereby performance
based on return on equity and sales growth is allocated a weight of 75% and
25%, respectively. Once a minimum of 10% return on equity is achieved,
executives can earn up to 130% of target for a return on equity of 18% or
more. Similarly, once a minimum of 5% sales growth is achieved, executives
can earn up to 45% of target for sales growth of 13% or more.
For fiscal 1994, the target incentive was set at 30% of base salary for
the CEO and COO; 24% for other officers of the Company; 15% for middle
managers of the Company and 18% for officers of subsidiaries. For fiscal year
1995, targets for the short-term incentive bonus plan were raised from 30% to
45% for Chairman and CEO, from 30% to 40% for President and COO, from 24% to
30% for the Vice President Finance, Secretary and Treasurer and the Vice
President Manufacturing, and from 18% to 20% for officers of subsidiaries.
These changes brought the Company's base pay and incentive targets closer to
the industry averages for similar positions. Bonus targets did not change
during fiscal year 1996.
Long-Term Incentive
The Company also provides long-term incentives in the form of stock
options. A stock option list is recommended by the Committee to the Board
annually. This year the list included ten senior executives and 59 other key
employees. These options are meant to recognize their individual contribution
to the long-term profit objectives of the Company.
Based on Company performance in 1995, the Committee recommended and the
Board approved the issuance of stock options on January 21, 1996, of 4,000
shares each for Mr. Knape, Mr. Perry, Mr. Simkins, and Mr. Van Rooy, and of
1,500 shares each for the presidents of the subsidiaries. Vice presidents of
the <PAGE> subsidiaries, middle management and other key employees were
awarded options of 1,000, 500, or 250 shares for a total option award of
45,000.
In addition, the Company has for many years made a yearly contribution
to the Profit Sharing Retirement Plan for all executives. The percentage of
profit allocated and the percentage of each executive'scompensation to be
contributed to that plan is recommended to the Board by the Committee. For
fiscal 1996, the Company contributed an amount equal to 7% of executives'
base salaries (limited to a maximum of $150,000) to the Profit Sharing
Retirement Plan.
The Company also maintains a Supplemental Executive Retirement Plan
(SERP) originally designed to assure new executive hirees the security of an
ongoing retirement plan in their first years of employment with the Company.
The Committee recommends eligibility of new members in this plan to the Board
and oversees its application.
Herbert F. Knape Mary Rita Cuddohy
John E. Fallon Richard S. Knape
Robert T. Kroon
<PAGE>
SUMMARY COMPENSATION TABLE
The following table sets forth the compensation received by the Company's
CEO and the other four most highly compensated executive officers of the
Company (the "Named Executives") for each of the three fiscal years ended
June 30, 1996, 1995, and 1994.
<TABLE>
Long-Term
Compensation
Annual Compensation Awards
Securities
Name & Principal Underlying Compensation
Position Year Salary(1) Bonus(2) Options(#) (3)
<S> <C> <C> <C> <C> <C>
Raymond E. Knape 1996 $260,000 $ -0- 4,000 $10,500
Former Chairman 1995 240,000 54,312 3,000 10,500
and Chief 1994 220,000 52,910 2,500 19,800
Executive Officer
Allan E. Perry 1996 210,000 $ -0- 4,000 $12,862
President and Chief 1995 195,500 39,315 3,000 12,862
Executive Officer 1994 169,300 36,926 2,500 17,599
Richard C. Simkins 1996 $156,000 $ -0- 4,000 $12,937
Executive VP, CFO, 1995 149,000 22,469 3,000 12,867
Secretary and 1994 133,000 25,589 2,500 14,407
Treasurer
Michael G. Van Rooy 1996 $128,000 $ -0- 4,000 $10,615
Vice President- 1995 106,333 17,417 1,500 9,740
Manufacturing, 1994 104,902 18,183 1,500 10,615
Vice President and
Chief Operating
Officer-Hirsh
Anthony R. Taylor 1996 $108,119 $ 7,024 1,500 1,767
President-KV Canada 1995 92,954 19,325 1,500 1,744
1994 91,512 13,010 1,500 1,787
</TABLE>
(1) Includes amounts deferred by employees pursuant to Section 401(k) of the
Internal Revenue Code.
(2) Represents amounts earned under the Company's short-term incentive bonus
plan.
(3) The amounts disclosed in this column include: (a) amounts contributed
by the Company to the Company's profit sharing plan for fiscal 1996,
pursuant to which substantially all salaried employees of the Company
participate, in the following amounts: Mr. Knape $10,500; Mr. Perry
$10,500; Mr. Simkins $10,500; and Mr. Van Rooy $8,960; and (b) payments
by the Company in fiscal 1996 of premiums for term life insurance for the
benefit of the Named Executives, in the following amounts: Mr. Perry
$2,362; Mr. Simkins $2,437; Mr. Van Rooy $1,655; and Mr. Taylor $1,767.
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table provides information on options granted to the Named
Executives during the year ended June 30, 1996.
<TABLE>
Individual Grants
Percentage
of Total Potential
Options Realizable Value
Granted to Exercise At Assumed Annual
Employees or Base Rates of Stock
in Price Price Appreciation
Options Fiscal (per for Option Term (4)
Granted Year share) Expiration
Name (1) (2) (3) Date 0% 5% 10%
<S> <C> <C> <C> <C> <C> <C> <C>
Raymond E. Knape 4,000 8.89% $15.00 1/19/06 $0 $16,734 $74,625
Allan E. Perry 4,000 8.89% $15.00 1/19/06 $0 $16,734 $74,625
Richard C. Simkins 4,000 8.89% $15.00 1/19/06 $0 $16,734 $74,625
Michael G. Van Rooy 4,000 8.89% $15.00 1/19/06 $0 $16,734 $74,625
Anthony R. Taylor 1,500 3.33% $15.00 1/19/06 $0 $ 6,275 $27,984
</TABLE>
(1) Indicates number of shares that may be purchased pursuant to options
granted under the Company's 1987 Stock Option Plan.
(2) The Company granted options covering 45,000 shares to eligible employees
of the Company and its subsidiaries.
(3) The exercise price equals the prevailing market price of the Company's
Common Stock on the date of grant. The exercise price may be paid in
cash, by the delivery of previously owned shares, or a combination
thereof.
(4) These potential realizable values are based on assumed rates of
appreciation in the market value of the Company's Common Stock over the
entire option period and without any discount to present value. There
can be no assurances that the amounts reflected in this table will be
achieved. As illustrated by the first subcolumn, without an increase in
the stock price above the market price at grant, no value is realized.
<PAGE>
AGGREGATED STOCK OPTION EXERCISES IN FISCAL 1996
AND YEAR END OPTION VALUES
The following table provides information on the exercise of stock options
during fiscal 1996 by the Named Executives and the number and value of
unexercised options at June 30, 1996.
<TABLE>
Shares Value of
Acquired Number of Unexercised in
on Value Unexercised Options the Money Options
Exercise Realized at June 30, 1996 at 6/30/96(2)
Name (#) ($)(1) Exercisable Exercisable
Unexercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
Raymond E. Knape -0- $0 5,750 4,000 $ 0 $3,000
Allan E. Perry -0- $0 8,500 4,000 $ 2,063 $3,000
Richard C. Simkins -0- $0 20,104 4,000 $51,463 $3,000
Michael G. Van Rooy -0- $0 3,700 4,000 $ 413 $3,000
Anthony R. Taylor -0- $0 3,150 1,500 $ 0 $1,125
</TABLE>
(1) Represents the aggregate market value of shares acquired at time of
exercise, less the aggregate exercise price paid by the employee to
the Company.
(2) Values are based on the difference between the closing price of the
Company's Common Stock on June 30, 1996, ($15.75) and the exercise
prices of the options.
SHAREHOLDER RETURN PERFORMANCE GRAPH
The following graph shows the cumulative total shareholder return on an
investment in the Company's Common Stock compared to the cumulative total
return of the NASDAQ market for U.S. companies and a peer group of NASDAQ
traded companies with the same Standard Industrial Classification (SIC) code
as that of the Company's. The comparison assumes a $100 dollar investment on
June 30, 1991, and the reinvestment of dividends.
<PAGE>
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
PERFORMANCE GRAPH FOR
KNAPE & VOGT MANUFACTURING COMPANY
280
260
240
220
200
180
160
140
120
100
80
6/30/91 6/30/92 6/30/93 6/30/94 6/30/95 6/30/96
<TABLE>
The dollar values for total shareholder return plotted in the graph above
are shown in the table below.
6/30/91 6/30/92 6/30/93 6/30/94 6/30/95 6/30/96
<S> <C> <C> <C> <C> <C> <C>
Knape & Vogt
Manufacturing Company 100.0 135.8 130.4 165.1 146.7 160.9
NASDAQ Stock Market
(US Companies) 100.0 120.1 151.1 152.5 203.6 261.4
NASDAQ Stocks
(SIC Code 3400-3499) 100.0 99.7 113.7 126.8 148.0 183.5
</TABLE>
*Index figures prepared by the Center for Research in Security Prices at The
University of Chicago.
<PAGE>
RELATIONS WITH INDEPENDENT PUBLIC ACCOUNTANTS
The consolidated financial statements of the Company have been examined
by BDO Seidman, LLP, Certified Public Accountants. A representative of BDO
Seidman, LLP is expected to be present at the Annual Meeting with the
opportunity to make a statement, if desired, and will be available to respond
to appropriate questions. During October of 1995, the Company's Audit
Committee selected the Company's auditors for the current fiscal year. It
is expected that the same practice will be followed this year. The Company
has no reason to believe that BDO Seidman, LLP will not be selected as the
Company's principal auditors for the current fiscal year. They have audited
the records of the Company for over ten years.
SHAREHOLDER PROPOSALS - 1997 ANNUAL MEETING
Any proposal of a shareholder intended to be presented for action at the
next Annual Meeting of the Company must be received by the Company at 2700 Oak
Industrial Drive, N.E., Grand Rapids, Michigan 49505, not later than May 16,
1997, if the shareholder wishes the proposal to be included in the Company's
proxy materials for that meeting.
AVAILABILITY OF 10-K ANNUAL REPORT
The annual report on Form 10-K, filed with the Securities and Exchange
Commission, will be provided free to shareholders upon written request. Write
Richard C. Simkins, Secretary, Knape & Vogt Manufacturing Company, 2700 Oak
Industrial Drive, N.E., Grand Rapids, Michigan 49505.
MISCELLANEOUS
Management of the Company is not aware of any other matter to be presented
for action at the meeting. However, if any such other matter is properly
presented for action, it is the intention of the persons named in the
accompanying form of proxy to vote thereon in accordance with their best
judgment.
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors, and persons who own more than 10 percent
of a registered class of the Company's equity securities, to file reports
of ownership and changes in ownership with the Securities and Exchange
Commission. Officers, directors and greater than 10 percent shareholders
are required to furnish the Company with copies of all Section 16(a) forms
they file. Based solely on the review of written communications and copies
of such forms received by the Company, the Company believes that all required
forms have been filed accurately and timely with the Securities and Exchange
Commission.
The cost of soliciting proxies in the accompanying form will be borne by
the Company. In addition to solicitation by mail, proxies may be solicited
in person, or by telephone or telegraph, by some regular employees of the
Company, and by Morrow & Co. which the Company has retained to assist in the
solicitation. The Company will pay Morrow & Co. $4,000 for its services. The
above Notice and Proxy Statement are sent by order of the Board of Directors.
September 16, 1996
Richard C. Simkins
Secretary
