As filed with the Securities and Exchange Commission on September 30, 1998
Registration No. 333-________
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
KNAPE & VOGT MANUFACTURING COMPANY
(Exact Name of Registrant as Specified in its Charter)
-------
Michigan 38-0722920
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
2700 Oak Industrial Drive, N.E.
Grand Rapids, Michigan 49505
(616) 459-3311
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
Jack D. Poindexter
Knape & Vogt Manufacturing Company
2700 Oak Industrial Drive, N.E.
Grand Rapids, Michigan 49505
(616) 459-3311
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
Donald L. Johnson
Varnum, Riddering, Schmidt & Howlett LLP
Suite 1700
333 Bridge Street, N.W.
Grand Rapids, Michigan 49504
(616) 336-6000
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
It the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box [ X ]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box.[ ]
<PAGE>
<TABLE>
CALCULATION OF REGISTRATION FEE
- ---------------------------------------------------------------------------------------------------------------------
Title of Each Proposed Maximum Proposed Maximum
Class of Securities Amount to be Offering Price Aggregate Offering Amount of
Being Registered Registered Per Share(1) Price Registration Fee
- ----------------------- ----------------------- ----------------------- ----------------------- -------------------
<S> <C> <C> <C> <C>
Common Stock
($2.00 par value) 300,000 shares $19.22 $5,766,000 $1,710
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For purposes of calculating the registration fee only, the price shown
is based upon a per share price of $19.22, the average of the high and
low sale prices for the Common Stock of the Registrant, as reported on
the NASD National Market System on September 24, 1998, in accordance
with Rule 457.
Pursuant to Rule 416(a) of the General Rules and Regulations under the
Securities Act of 1933, the Prospectus filed as part of this Registration
Statement shall cover such additional securities as may be offered or issued to
prevent dilution resulting from stock splits, stock dividends or similar
transactions.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
PROSPECTUS
KNAPE & VOGT MANUFACTURING COMPANY
STOCK DIVIDEND SALE PLAN
Shares of Stock Offered by Stockholders Enrolled in the Stock Dividend Sale Plan
-------------------
Knape & Vogt Manufacturing Company (the "Company") has adopted a Stock
Dividend Sale Plan (the "Plan"). The Board of Directors of the Company has
resolved to replace quarterly cash dividends with quarterly stock dividends. The
purpose of the Plan is to give owners of Common Stock, par value $2.00 per share
("Common Stock") and Class B Common Stock, par value $2.00 per share ("Class B
Common Stock") of the Company the opportunity to convert stock dividends into
cash by the sale of such stock dividends through a simplified procedure under
which brokerage commissions, charged at a fixed rate per share, are expected to
be lower than commissions normally charged for sales of relatively small numbers
of shares and odd lots. Under the Plan, all shares of Company Stock distributed
as regular quarterly stock dividends by the Company to stockholders
participating in the Plan, to the extent so participating, will be offered for
sale by the Plan Broker through the National Market System of the National
Association of Securities Dealers.
Please refer to the more detailed discussion of the terms and features of
the Plan contained in this Prospectus.
The Plan Administrator is currently Harris Trust and Savings Bank. The Plan
Broker is currently Credit Suisse First Boston.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS IN CONNECTION WITH
THE OFFER CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, ANY SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY
JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH
JURISDICTION.
--------------------
The date of this Prospectus is _____________________, 1998.
<PAGE>
TABLE OF CONTENTS
Page Number
Knape & Vogt Manufacturing Company............................................ 2
Stock Dividend Sale Plan...................................................... 2
Plan of Distribution.......................................................... 4
Federal Income Tax Consequences............................................... 5
Legal Matters................................................................. 6
Experts....................................................................... 6
Available Information......................................................... 6
Incorporation of Certain Documents by Reference............................... 6
1
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KNAPE & VOGT MANUFACTURING COMPANY
The Company designs, manufactures and distributes storage-related products
for original equipment manufacturers, specialty distributors, hardware chains
and every major home center in the country. The Company's major product
categories include precision, Euro-style and utility drawer slides;
wall-attached shelving units; kitchen, closet and bath storage products; and
specialty hardware products. The Company was incorporated in Michigan in 1906,
reorganized in Delaware in 1961, and reorganized in Michigan in 1985. The
Company's main plant and corporate offices are located at 2700 Oak Industrial
Drive, N.E., Grand Rapids, Michigan 49505, and its telephone number is (616)
459-3311. Unless otherwise noted or indicated by the context, the term "Company"
includes Knape & Vogt Manufacturing Company, its predecessors and its
subsidiaries.
The Company's Common Stock, par value $2.00 per share, is traded and
reported on the National Market System of the National Association of Securities
Dealers Automated Quotation System ("NASDAQ/NMS") under the symbol KNAP.
STOCK DIVIDEND SALE PLAN
Purpose
The purpose of the Company's Stock Dividend Sale Plan (the "Plan") is to
give owners of Common Stock and Class B Common Stock the opportunity to convert
stock dividends into cash by the sale of such stock dividends through a
simplified procedure under which brokerage commissions, charged at a fixed rate
per share, are expected to be lower than commissions normally charged for sales
of relatively small numbers of shares and odd lots.
Eligibility
All owners of record ("Record Owners") of the Common Stock and Class B
Common Stock (collectively, "Stock"), and owners of Stock held by brokers and
other custodial institutions that establish procedures which permit their
customers to participate in the Plan ("Eligible Customers"), are eligible to
enroll in the Plan. (Brokers and other custodial institutions that establish
such procedures for their customers are referred to as "Participating Brokers.")
Election to Participate and Sell Dividends
Through this Prospectus, the Company is advising Record Owners and Eligible
Customers (acting through Participating Brokers) that they have the opportunity
of enrolling in the Plan and of directing the sale of quarterly stock dividends
to which they are entitled. The sale of Stock dividends will be accomplished
through the facilities of a brokerage firm acting on their behalf on an agency
basis ("Plan Broker"). A Record Owner wishing to have stock dividends sold by
the Plan Broker must complete and sign the Enrollment Form and return it to the
Administrator, Harris Trust and Savings Bank ("Plan Administrator"). A separate
Enrollment Form must be used for each separate account (separate name and
registration) in which a Record Owner holds shares.
Eligible Customers of Participating Brokers wishing to have their stock
dividends sold by the Plan Broker must enroll in the Plan through their
Participating Broker. Eligible Customers of Participating Brokers who are
included in the Plan through enrollment by their brokers or custodians acting on
their behalf are referred to herein as "Participating Customers."
Sales of Future Stock Dividends Pursuant to Enrollment
Each account of a Record Owner of Stock for which an Enrollment Form is
completed and delivered to the Plan Administrator (an "Enrolled Account"), and
Participating Customers who are enrolled in the Plan through their broker or
custodial institution, thereby direct the sale of all Stock dividends received
with respect to that number of
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shares of Stock that are designated by such Participating Customer and
registered in such account as of the record date for each quarterly stock
dividend during the Company's fiscal year ("Plan Year"). All such shares
distributable as a stock dividend on the shares designated to be enrolled in the
Plan will be sold by the Plan Broker for the participants. The provisions of the
Plan do not prohibit Participants from selling shares of Stock held in their
accounts any time during the Plan Year or from adding more shares to their
accounts. Disposition of all shares of Stock held in participants' accounts will
terminate enrollment. A change of address will not affect any enrollment.
Credit Suisse First Boston, 227 West Monroe Street, Chicago, Illinois
60606, has been appointed as Plan Broker.
Enrollment Periods; Amendment and Withdrawal
An Enrollment Form is being mailed to each Record Owner. To participate in
the Plan during the year, the Enrollment Form must be mailed to the Plan
Administrator, Harris Trust and Savings Bank and postmarked by _________ for the
Plan Year second quarter ending December 31, 1998. To begin to participate in
the Plan as to subsequent quarterly stock dividends, Record Owners and
Participating Brokers on behalf of Eligible Customers must mail an Enrollment
Form to the Administrator postmarked no later than one of the following dates
for the enrollment to be effective for the that quarter's dividend: third
quarter of the Plan Year _______; fourth quarter of the Plan Year __________;
first quarter of the Plan Year ________; and second quarter of the Plan Year
_________. Enrollment in the Plan may be made throughout the Plan Year except
during the periods between quarterly dividend declaration and dividend
distribution dates, (however, this limitation does not apply to the Plan Year
second quarter ending December 31, 1998). Enrollment Forms postmarked during
these periods will be held and enrollment will take effect for the next dividend
payment date.
Once Stock held in an account for a Record Owner has been enrolled, all
stock dividends receivable as to the enrolled stock in that account will be sold
quarterly through the Plan, from year to year, until enrollment is withdrawn by
the shareholder. A Record Owner of Stock may withdraw an account from the Plan
or adjust the amount of enrolled stock in the account by notifying the
Administrator in writing prior to the above dates. If all Stock held in a Record
Owner's account is enrolled in the Plan, any change in registration of shares of
Stock, whether from acquisitions or disposition of shares, received by the
Administrator prior to a quarterly stock dividend distribution date will
automatically increase or decrease the number of shares enrolled in the Plan.
Once a Record owner withdraws an account from the Plan, the account may not be
re-enrolled in the Plan for 12 months. For example, if the account is withdrawn
from the Plan by May 1, 1999, the account may not be enrolled again until May 1,
2000. All stock dividends receivable as to all Stock held in an account which
has been enrolled in the Plan by a Participating Broker will be sold quarterly
through the Plan, from year to year, until enrollment is withdrawn by the
Participating Broker. The Administrator will promptly advise each Participating
Broker of the declaration of and record date for each quarterly stock dividend.
Within five trading days after the record date, Participating Brokers are
required to advise the Administrator of the number of shares held by the
Participating Broker for its Participating Customers as of the record date. The
Administrator will then adjust the number of shares of enrolled stock in the
Participating Broker's account as of that record date.
Sales Price and Brokerage Commission
The sales price for participating shares sold in connection with a Stock
dividend will be the weighted average sales price received by the Plan Broker,
on an agency basis, for all such shares sold in the market. The proceeds of the
sale, minus a five cents per share brokerage commission payable to the Plan
Broker, will be remitted by the Plan Broker to the Plan Administrator for the
account of each participant. This will be the only commission, mark up, mark
down, spread, expense or other compensation to the Plan Broker.
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Remittance to Participants
Promptly upon receipt of the final proceeds of the sale of participating
shares, the Plan Administrator will arrange for the remittance to each
participant of his or her proportionate share of the net proceeds. Each
participant will be informed of the number of shares sold for such participant
and the weighted average selling price, as well as any other pertinent
information. Should any transfer taxes be imposed or tax withholding be
required, they will be deducted from a participant's remittance.
Administration
The Plan will be administered by the Plan Administrator. The Administrator
is Harris Trust and Savings Bank, 311 West Monroe Street, Chicago, Illinois
60606.
Certain Costs and Expenses
The Company will pay all of the administrative expenses relating to the
Plan, including the fees and expenses of the Plan Administrator, but will not
bear the expense of any brokerage commissions.
Tax Withholding and Forms 1099-B
The Plan Administrator is authorized to withhold any funds required to be
withheld by any United States or foreign taxing authority having jurisdiction.
The Plan Administrator will issue and distribute all Forms 1099-B and any other
reports required by any taxing authority.
Compliance with Law
The implementation of the Plan shall, in all instances, be subject to the
requirements of applicable laws and regulations.
Modification, Suspension or Termination
The Company reserves the right to modify, suspend or terminate the Plan at
any time provided that no such modification, suspension or termination shall
adversely affect the right of each participant under the Plan either to receive
payment for any participating shares which have been delivered to the Plan
Broker for sale or, in the alternative, to receive delivery of such shares.
PLAN OF DISTRIBUTION
All Participating Shares payable as a Stock dividend during the Plan Year
with respect to Enrolled Stock in an Enrolled Account or with respect to all
Stock in an Enrolled Brokers' Account will be sold by the Plan, on an agency
basis, for the Participants commencing no earlier than three trading days prior
to each stock dividend payment date.
The sales price of Participating Shares will be the weighted average net
sales price received by the Plan Broker, on an agency basis, for all
Participating Shares of all Participants. The net proceeds of the sale, less a
per share commission of five cents payable to the Plan Broker, will be remitted
by the Plan Broker to the Administrator for the account of each Participant.
This will be the only commission, discount, mark up, mark down, spread, expense
or other compensation to the Plan Broker. The Plan Broker is currently Credit
Suisse First Boston.
The Administrator will charge no brokerage fees in connection with the sale
of any shares sold pursuant to the Plan. The Company will pay all of the
administrative expenses relating to the Plan, including any fees and expenses of
the Administrator, but will not bear the expense of any brokerage commissions.
4
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FEDERAL INCOME TAX CONSEQUENCES
Shareholders are treated as having received a stock dividend and therefore
must apply the existing cost or other basis of Stock held before the stock
dividend proportionately between (1) the shares held before the stock dividend
and (2) the shares received as a stock dividend, based on the fair market value
on the date of payment of the stock dividend. Each Participant should consult
his or her attorney, accountant or tax adviser regarding the cost or basis for
tax purposes. If the net sales price for the stock dividend shares exceeds or is
less than the allocated cost or other basis of the stock dividend shares sold
through the Stock Dividend Sale Plan, participating shareholders will recognize
a gain or loss for tax purposes, subject to the "wash sale" rules and other
special rules applicable to such sales. Ordinarily, the typical investor (i.e.,
one who does not hold the Stock as inventory or primarily for sale to customers
in the ordinary course of business) will report the gain or loss as capital gain
or loss, and will be entitled to long-term capital gain treatment on any gain if
the applicable holding period (currently more than 12 months) is satisfied.
The following hypothetical example illustrates the tax consequences. Assume
that a shareholder, prior to the first-quarter dividend, owned 200 shares with
an original cost basis of $2,500. A stock dividend of 1% is payable in the first
quarter, entitling the shareholder to 2 shares (200 x 1%). Through the Stock
Dividend Sale Plan, the net cash proceeds from the sale of 2 shares equals
$35.90. (Assuming the weighted average sales price in the market was $18 per
share, times 2 shares = $36, minus a commission of five cents for each full
share.)
For tax purposes, the original cost basis ($2,500) is allocated between the
existing shares (200) and the new dividend shares (2) based on their relative
fair market value of $3,600 (200 x $18).
<TABLE>
<S> <C> <C>
Fair market value of dividend shares $36 (2 x $18)
Fair market value of existing shares $3,600 (200 x $18)
Original cost basis $2,500
</TABLE>
As shown below, in this hypothetical example the dividend shares will have
an allocated cost basis of $24.75 and the existing shares will have a cost basis
of $2,475.25.
$3,600 x $2,500 = $2,475.25 (allocated cost basis of existing shares)
- --------------
$3,600 + $36
$36 x $2,500 = $24.75 (allocated cost basis of dividend shares)
- --------------
$3,600 + $36
The shareholder in this example would use the allocated cost basis to
compute his or her gain or loss upon sale or disposition of the dividend shares.
In this example, the shareholder would have a gain of $11.15 ($35.90 - $24.75 =
$11.15). To compute gain or loss, a shareholder would always use the net cash
proceeds amount, which in this example was $35.90. Note that the basis of the
existing shares is reduced by the amount allocated to the dividend shares sold.
In the above illustration, the basis of the 200 shares after the sale of the
dividend shares is $2,475.25.
The procedure illustrated in the above example would be repeated each time
shares are sold through the Stock Dividend Sale Plan. Actual gain and basis for
a particular Plan Participant will be determined based on that Participant's
actual basis and the actual sale price for the shares of Stock.
The Administrator will issue and distribute all required Forms 1099 and any
other forms or reports required by taxing authorities. The Administrator is
authorized to withhold any funds required to be withheld by any United States or
foreign taxing authority having jurisdiction.
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LEGAL MATTERS
The validity of the securities offered hereby will be passed upon for Knape
& Vogt Manufacturing Company by Varnum, Riddering, Schmidt & Howlett LLP.
EXPERTS
The consolidated balance sheets as of June 30, 1998 and 1997 and the
consolidated statements of operations and cash flows for each of the three years
in the periods ended June 30, 1998 and 1997 and 1996, incorporated by reference
in this Prospectus have been incorporated herein in reliance on the report of
BDO Seidman, LLP, given on the authority of that firm as experts in accounting
and auditing.
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement, of which this Prospectus constitutes a
part, (together with all amendments and exhibits thereto, the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities Act"),
with respect to the shares of Common Stock offered by this Prospectus. This
Prospectus does not contain all of the information set forth in such
Registration Statement, certain parts of which are omitted in accordance with
the rules and regulations of the Commission. Reference is made to such
Registration Statement and to the exhibits relating thereto for further
information with respect to the Company. Statements contained herein concerning
the provisions of any document filed as an exhibit to the Registration Statement
or otherwise filed with the Commission or incorporated by reference herein are
not necessarily complete, and, in each instance, reference is made to the copy
of such document so filed for a more complete description of the matter
involved. Each such statement is qualified in its entirety by such reference.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Commission. Such reports, proxy statements and other information concerning the
Company may be inspected and copied at prescribed rates at the Commission public
reference facilities at 450 Fifth Street, N.W., Washington, D.C. 20549, and
should also be available for inspection and copying the following Regional
Offices of the Commission: 7 World Trade Center, 13th floor, New York, New York
10048; and Suite 11400 Citicorp Center, 500 West Madison Street, Chicago,
Illinois 60661. The public may obtain information on the operation of the public
reference room by calling the Commission at 1-800-SEC-0330. The Commission
maintains a Worldwide Web site on the Internet at http://www.sec.gov that
contains reports, proxy statements and other information related to registrants
that file electronically with the Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by Knape & Vogt Manufacturing Company (File
No. 2-18868) with the Commission pursuant to the Exchange Act are incorporated
by reference herein and are made a part hereof by such reference: (i) Annual
Report on Form 10-K for the fiscal year ended June 30, 1998 (the "1998 Form
10-K"), (ii) Current Report on Form 8-K filed with the Commission on September
15, 1998, (iii) Schedule 13e-4 filed with the Commission on September 2, 1998,
as amended, and (iv) the Proxy Statement for the Company's October 16, 1998
Annual Meeting of Shareholders.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date hereof and prior to the
termination of the offering of the Common Stock pursuant hereto shall be deemed
to be incorporated by reference in this Prospectus and to be a part hereof from
the date of filing of such documents.
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Any statement contained herein or in a document incorporated or deemed to
be incorporated by reference herein or in any supplement hereto shall be deemed
to be modified or superseded for purposes of such document to the extent that a
statement contained herein or therein (or in any other subsequently filed
document that also is or is deemed to be incorporated by reference herein or
therein) modifies or supersedes such statement. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus or any supplement hereto.
The Company will provide without charge to each person to whom a copy of
this Prospectus has been delivered, upon the written or oral request of any such
person, a copy of any or all of the foregoing documents incorporated herein by
reference, other than exhibits to such documents. Such requests should be
directed to Jack D. Poindexter, Knape & Vogt Manufacturing Company, 2700 Oak
Industrial Drive, N.E., Grand Rapids, Michigan 49505, telephone (616) 459-3311.
--------------------
NO DEALER, SALESPERSON, OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFERING
COVERED BY THIS PROSPECTUS. IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, THE COMMON STOCK IN ANY JURISDICTION WHERE, OR TO ANY PERSON
TO WHOM, IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY
OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES,
CREATE AN IMPLICATION THAT THERE HAS NOT BEEN ANY CHANGE IN THE FACTS SET FORTH
IN THIS PROSPECTUS OR IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
------------------
7
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PART II
Information Not Required in Prospectus
Item 14. Other Expenses of Issuance and Distribution
Expenses in connection with the issuance and distribution of the securities
being registered are estimated as follows, all of which are to be paid by the
Company.
<TABLE>
<S> <C>
SEC Registration Fee............................ $1,710
Printing and Mailing Expenses................... 1,000
Accounting Fees................................. 1,000
Legal Fees and Expenses......................... 2,000
Blue Sky Fees and Expenses...................... 500
Miscellaneous................................... 1,000
-------
$7,210
</TABLE>
Item 15. Indemnification of Directors and Officers.
The Articles of Incorporation of Registrant provide that its directors,
officers, employees or agents, or persons serving at its request as directors,
officers, employees, or agents of another corporation or enterprise, are
required to be indemnified as of right to the fullest extent permitted under the
Michigan Business Corporation Act ("MBCA"). Under the MBCA, directors, officers,
employees or agents are entitled to indemnification against expenses (including
attorney fees) whenever they successfully defend legal proceedings brought
against them by reason of the fact that they hold such a position with the
corporation. In addition, with respect to actions not brought by or in the right
of the corporation, indemnification is permitted under the MBCA for expenses
(including attorney fees), judgments, fines, penalties and reasonable
settlements if it is determined that the person seeking indemnification acted in
a good faith and in a manner he or she reasonably believed to be in and not
opposed to the best interest of the corporation or its shareholders and, with
respect to criminal proceedings, he or she had no reasonable cause to believe
that his or her conduct was unlawful. With respect to actions brought by or in
the right of the corporation, indemnification is permitted under the MBCA for
expenses (including attorney fees) and reasonable settlements, if it is
determined that the person seeking indemnification acted in good faith and in a
manner he or she reasonably believed to be in and not opposed to the best
interest of the corporation or its shareholders; provided, indemnification is
not permitted if the person is found liable to the corporation, unless the court
in which the action or suit was brought has determined that indemnification is
fair and reasonable in view of all the circumstances of the case.
The Articles of Incorporation of the Registrant also limit the personal
liability of members of its Board of Directors for monetary damages with respect
to claims by the Registrant or its shareholders resulting from certain negligent
acts or omissions.
Item 16. Exhibits.
Reference is made to the Exhibit Index which appears at page II-4 of the
Registration Statement.
Item 17. Undertakings.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
II-1
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(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represents a fundamental change in the information set
forth in the registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement; provided, however, that paragraphs (1)(i) and
(1) (ii) do not apply if the registration statement is on Form S-3,
Form S-8, or Form F-3, and the information required to be included in
a post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13 or
Section 15 (d) of Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bonafide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Grand Rapids, State of Michigan, on September 30,
1998.
KNAPE & VOGT MANUFACTURING COMPANY
By: /s/ Allan E. Perry
Allan E. Perry
President and Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Allan E. Perry and Jack D. Poindexter, and each
of them, his true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents or his substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Date
/s/ Allan E. Perry September 30, 1998
Allan E. Perry, Chief Executive
Officer and a Director
/s/ Jack D. Poindexter September 30, 1998
Jack D. Poindexter, Principal
Financial and Accounting Officer
/s/ Richard C. Simkins September 30, 1998
Richard C. Simkins, Executive Vice
President and a Director
September 30, 1998
Mary Rita Cuddohy, Director
/s/ William R. Dtumers September 30, 1998
William R. Dutmers, Chairman
of the Board
/s/ John E. Fallon September 30, 1998
John E. Fallon, Director
September 30, 1998
Michael J. Kregor, Director
/s/ Herbert F. Knape September 30, 1998
Herbert F. Knape, Director
/s/ Raymond E. Knape September 30, 1998
Raymond E. Knape, Director
/s/ Richard S. Knape September 30, 1998
Richard S. Knape, Director
II-3
<PAGE>
EXHIBIT INDEX
Sequentially
Numbered
Exhibit Number Description Page
5 Opinion of Varnum, Riddering, Schmidt & Howlett LLP
8 Tax Opinion of Varnum, Riddering, Schmidt & Howlett LLP
10.1 Knape & Vogt Manufacturing Company Stock Dividend Sale Plan
10.2 Form of Stock Dividend Sale Plan Enrollment Form
10.3 Form of Agreement between Knape & Vogt Manufacturing Company and
Harris Trust and Savings Bank as Plan Administrator dated
as of ____________, 1998.
10.4 Form of Agreement between Knape & Vogt Manufacturing Company and
Credit Suisse - First Boston as Plan Broker dated as of
_____________, 1998.
23.1 Consent of BDO Seidman, LLP, independent public accountants
23.2 Consent of Varnum, Riddering, Schmidt & Howlett LLP
(included in opinion filed as Exhibit 5)
24 Power of Attorney (included on the signature page on
page II-3 of the Registration Statement)
II-4
<PAGE>
EXHIBIT 5
VARNUM, RIDDERING, SCHMIDT & HOWLETT LLP
--------------------------------------
ATTORNEYS AT LAW
BRIDGEWATER PLACE
POST OFFICE BOX 352 - GRAND RAPIDS, MICHIGAN 49501-0352
TELEPHONE 616/336-6000 - FAX 616/336-7000
September 30, 1998
Knape & Vogt Manufacturing Company
2700 Oak Industrial Drive, N.E.
Grand Rapids, Michigan 49505
Re: Registration Statement on Form S-3 Relating to the
Knape & Vogt Manufacturing Company
Stock Dividend Sale Plan
Gentlemen:
With respect to the Registration Statement on Form S-3 (the "Registration
Statement"), filed by Knape & Vogt Manufacturing Company, a Michigan corporation
(the "Company"), with the Securities and Exchange Commission for the purpose of
registering under the Securities Act of 1933, as amended, 300,000 shares of the
Company's common stock, par value $2.00 per share, for sale pursuant to the
Company's Stock Dividend Sale Plan (the "Plan"), we have examined such documents
and questions of law we consider necessary or appropriate for the purpose of
giving this opinion. On the basis of such evaluation, we advise you that in our
opinion the 300,000 shares covered by the Registration Statement when sold in
accordance with the procedures described in the Registration Statement and the
Plan, will be duly and legally authorized, issued and outstanding and will be
fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving this consent, we do not thereby admit that we
are within the category of persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended, or under the rules and regulations of
the Securities and Exchange Commission relating thereto.
Sincerely,
VARNUM, RIDDERING, SCHMIDT & HOWLETT LLP
/s/ Varnum, Riddering, Schmidt & Howlett LLP
<PAGE>
EXHIBIT 8
VARNUM, RIDDERING, SCHMIDT & HOWLETT LLP
--------------------------------------
ATTORNEYS AT LAW
BRIDGEWATER PLACE
POST OFFICE BOX 352 - GRAND RAPIDS, MICHIGAN 49501-0352
TELEPHONE 616/336-6000 - FAX 616/336-7000
September 30, 1998
Board of Directors
Knape & Vogt Manufacturing Company
2700 Oak Industrial Drive, N.E.
Grand Rapids, MI 49505
Re: Knape & Vogt Manufacturing Company (the "Company")
Tax Opinion Concerning Company's Stock Dividend Sale Plan
(the "Plan")
Ladies and Gentlemen:
This letter sets forth our opinion as to certain federal income tax
consequences of the above-referenced Plan of our client, the Company. The Plan
involves the Company's anticipated periodic distribution of stock dividends
followed by the opportunity for shareholders to convert the stock dividends into
cash. This would occur by the sale of stock through a simplified procedure under
which brokerage commissions, charged at a fixed rate per share, are expected to
be lower than commissions normally charged for sales of relatively small numbers
of shares and odd lots. The Plan is more fully described in the Prospectus
included in the Registration Statement on Form S-3 filed with the Securities and
Exchange Commission (the "Prospectus"), as to which this opinion is an exhibit.
In arriving at the opinions expressed below, we have examined and relied on
the statements contained in the Prospectus, the Plan, and such other corporate
records of the Company as we have deemed appropriate. We have also assumed that
there is no plan or intention on the part of the Company to regularly redeem or
buy its shares in such a manner as to cause such redemptions or purchases to be
considered part of the Plan. We have assumed that the representations contained
in the Prospectus are accurate and that the Plan will be effected in accordance
with its terms. In addition, we have made such other investigations of law as we
have deemed appropriate as a basis for the opinions expressed below.
Based on our understanding of the facts, and on the representations and
assumptions stated herein, it is our opinion that the discussion contained in
the section of the Prospectus
::ODMA\PCDOCS\GRR\207947\1
<PAGE>
Boards of Directors
Knape & Vogt Manufacturing Company
Page 2
September 30, 1998
captioned "Federal Income Tax Consequences" filed as part of the Registration
Statement constitutes, in all material respects, a fair and accurate summary of
the United States federal income tax consequences arising under the Plan, based
upon current law. It is possible, however, that contrary positions may be taken
by the Internal Revenue Service and that a court may agree with such contrary
positions, and it is also our view that such tax discussion does not purport to
address all possible United States federal income tax consequences relating to
the Plan.
This opinion letter is furnished to you solely for your benefit in
connection with the filing of the Registration Statement and, except as set
forth below, is not to be used, circulated, quoted, or otherwise referred to for
any other purpose or relied upon by any other person for any purpose without our
written consent. We hereby consent to the use of our name as appearing in the
Prospectus and the filing of this opinion with the Securities and Exchange
Commission as an exhibit to the Registration Statement. In giving this consent,
we do not admit that we are within the category of persons whose consent is
required under Section 7 of the Securities Act of 1933, as amended, or the rules
and regulations of the Commission promulgated thereunder. This opinion is
expressed as of the date hereof and applies only to the disclosure set forth in
the Prospectus filed as of the date hereof. We disclaim any undertaking to
advise you of any subsequent changes of the facts stated or assumed herein or
any subsequent changes in applicable law.
This opinion letter is limited to the specific issues addressed above and
is not intended to address any other issues. This opinion letter is governed by,
and shall be interpreted in accordance with, the Legal Opinion Accord (the
"Accord") of the ABA Section of Business Law (1991). Accordingly, it is subject
to a number of qualifications, exceptions, definitions, limitations on coverage,
and other limitations, all as more particularly described in the Accord. The law
covered by the opinions expressed in this opinion letter is limited to the
federal law of the United States.
Respectfully submitted,
VARNUM, RIDDERING, SCHMIDT & HOWLETT LLP
/s/ Varnum, Riddering, Schmidt & Howlett LLP
::ODMA\PCDOCS\GRR\207947\1
<PAGE>
EXHIBIT 10.1
KNAPE & VOGT MANUFACTURING COMPANY
STOCK DIVIDEND SALE PLAN
1. Purpose and Effective Date. The Board of Directors of Knape & Vogt
Manufacturing Company (the "Company") has resolved to replace quarterly cash
dividends with quarterly Stock dividends. The purpose of the Company's Stock
Dividend Sale Plan (the "Plan") is to give owners of Common Stock, par value
$2.00 per share ("Common Stock") and Class B Common Stock, par value $2.00 per
share ("Class B Common Stock"), the opportunity to convert dividends in the form
of Stock into cash by the sale of such Stock dividends through a simplified
procedure under which brokerage commissions will be charged at a fixed rate per
share that is expected to be lower than commissions normally charged for sales
of relatively small numbers of shares and odd lots. For convenience, the
definitions of certain terms used in the Plan are repeated in the Glossary
attached hereto. The Plan shall be effective as of the record date that the
Company's Board of Directors designates for the Stock dividend declared for the
Plan Year second quarter ending December 31, 1998.
2. Eligibility. All owners of record ("Record Owners") of Common Stock and
Class B Common Stock and owners of Common Stock and Class B Common Stock held by
brokers and other custodial institutions holding such Stock ("Eligible
Customers") who establish procedures which permit their customers to participate
in the Plan if they so desire are eligible to enroll in the Plan. (Brokers and
other custodial institutions which establish such procedures are hereby referred
to as "Participating Brokers." Record Owners and Eligible Customers [acting
through their Participating Brokers] are sometimes collectively referred to as
"Eligible Stockholders").
3. Dividend Sale Election.
A. Election to Participate. The Administrator will arrange for the
notification to all record holders of Stock of the date that the Plan
became effective. Thereafter, notification of the existence of the Plan
will be included from time to time in Company communications to its
shareholders. Record Owners and Participating Brokers will be provided
Enrollment Forms and will be advised that Record Owners and Eligible
Customers (acting through Participating Brokers) will have the opportunity,
by timely enrollment in the Plan, of directing the sale of Stock dividends
to be received, after such enrollment and as long as the Plan is in effect,
through the facilities of a brokerage firm acting on their behalf on an
agency basis (the "Plan Broker"). A Record Owner, or Participating Broker
acting on behalf of its Eligible Customers, wishing to have future Stock
dividends sold as contemplated by the Plan on an agency basis, must
complete and sign the Enrollment Form and return it to the Administrator
postmarked by _________ for the Plan Year second quarter ending December
31, 1998. To begin to participate in the Plan as to subsequent quarterly
Stock dividends, Record Owners and Participating Brokers on behalf of
Eligible Customers must mail an Enrollment Form to the Administrator
postmarked no later than one of the following dates for the enrollment to
be effective for the that quarter's dividend: third
<PAGE>
quarter of the Plan Year __________; fourth quarter of the Plan Year
__________; first quarter of the Plan Year __________; and second quarter
of the Plan Year ____________. Enrollment in the Plan may be made
throughout the Plan Year except during the periods between quarterly
dividend declaration and dividend distribution dates (however, this
limitation does not apply to the Plan Year second quarter ending December
31, 1998). Enrollment Forms postmarked during these periods will be held
and enrollment will take effect for the next dividend payment date. Once
Stock has become Enrolled Stock, all Stock dividends with respect to that
Enrolled Stock will be sold quarterly through the Plan, from year to year,
until enrollment is withdrawn by the Record Owner or Participating Broker.
Record Owners or Participating Brokers may withdraw Stock as Enrolled Stock
or increase the amount of Stock which is Enrolled Stock by notifying the
Administrator in writing prior to the above dates. However, a Record Owner
may withdraw all of his or her Enrolled Stock from the Plan only one time
during any consecutive twelve (12) month period. A separate Enrollment Form
must be used for each separate account (separate name and registration) in
which a Record Owner holds shares. Eligible Customers of Participating
Brokers who are included in the Plan through enrollment by their brokers or
custodians acting on their behalf are referred to herein as "Participating
Customers."
B. Enrolled Accounts and Enrolled Brokers' Accounts. Each account for
which an Enrollment Form is completed and timely delivered to the
Administrator thereby directs the sale under the Plan of all Stock
dividends received with respect to the Enrolled Stock registered in such
account. An Enrolled Account means each account of a Record Owner as to
which an Enrollment Form is completed and timely delivered to the
Administrator. Unless the context requires otherwise, the term "Enrolled
Account" also includes the registered owner of such account and the shares
of Enrolled Stock held by such account at the time in question. An
"Enrolled Brokers' Account" means an account consisting of all shares of
Stock owned by the Participating Customers whom a Participating Broker has
enrolled in the Plan. Unless the context requires otherwise, the term
"Enrolled Brokers' Account" also includes the owner of shares included in
such account and the shares designated by the Participating Broker as
comprising such account at the time in question. Each Enrolled Account and
each Enrolled Brokers' Account may be referred to herein as a
"Participant," and such accounts may collectively be referred to as
"Participants."
C. Enrolled Stock and Participating Shares. As of any date during the
Plan Year, "Enrolled Stock" means shares of Common Stock or Class B Common
Stock held as of such date by (1) an Enrolled Account and designated on the
Enrollment Form as Enrolled Stock or (2) an Enrolled Broker's Account. If
no designation is made as to the number of shares of Enrolled Stock, all
Stock held in an Enrolled Account will be deemed to be Enrolled Stock.
Shares of Common Stock payable as a Stock dividend on Enrolled Stock as of
any record or payment date for such Stock dividend are sometimes referred
to herein as "Participating Shares."
D. Shares Included in Enrollment
(1) Each Enrolled Account which has enrolled in the Plan must
sell all, but not less than all, Stock dividends to be received with
respect to all shares of Enrolled Stock
-2-
<PAGE>
which are registered as of each record date during the Plan Year in
the name of such Enrolled Account. Each Enrolled Brokers' Account must
sell all, but not less than all, of the Stock dividends to be received
with respect to the shares of Stock comprising such account as of each
record date during the Plan Year. Unless and until shares are
withdrawn from Enrollment as provided in Section 3A, enrollment shall
be irrevocable and each authorization and power of attorney shall be
deemed to be an irrevocable power coupled with an interest.
Any change in registration of shares of Enrolled Stock held by a
Participant received by the Administrator prior to the record date for
any Stock dividend (a) will terminate enrollment of shares of Enrolled
Stock which are disposed of from an Enrolled Account in which all
Stock is Enrolled Stock, and (b) will constitute enrollment, as
Enrolled Stock, for shares which are acquired in an Enrolled Account
in which all Stock is Enrolled Stock. The Administrator will promptly
advise each Participating Broker of the declaration of a dividend and
the record date therefore. Promptly after each record date and in no
event more than five trading days later than such record date, each
Participating Broker will promptly advise the Administrator of the
number of shares held by the Participating Broker for Participating
Customers as of the record date (being the number of shares
constituting its Enrolled Brokers' Account), and an adjustment in the
number of shares of Enrolled Stock will be made by the Administrator
as of such record date.
Disposition of all shares of Stock held in an Enrolled Account or
an Enrolled Brokers' Account will terminate enrollment. A change of
address will not affect the effectiveness of any enrollment.
(2) Sale of Stock Dividends. All Participating Shares
distributable as a Stock dividend during the Plan Year with respect to
Enrolled Stock in an Enrolled Account or with respect to all Stock in
an Enrolled Brokers' Account will be sold by the Plan, on an agency
basis, for the Participants commencing no earlier than three trading
days prior to each dividend distribution date.
(3) Sales Price and Brokerage Commissions. The sales price of
Participating Shares will be the weighted average net sales price
received by the Plan Broker, on an agency basis, for all Participating
Shares of all Participants. The net proceeds of the sale, less a per
share commission payable to the Plan Broker, will be remitted by the
Plan Broker to the Administrator for the account of each Participant.
This will be the only commission, discount, mark up, mark down,
spread, expense or other compensation to the Plan Broker.
(4) Remittance to Participants. Promptly upon receipt of the
final proceeds of the sale of all Participating Shares to be sold in
connection with a Stock dividend, the Plan Broker shall remit to the
Administrator for the account of each Participant, of his or her
proportionate share of the net proceeds from the sale of Participating
Shares. The Administrator will then promptly remit to each Participant
who is a Record Owner that Participant's proportionate share of the
net proceeds from the sale of Participating Shares less any applicable
transfer taxes and any applicable withholding pursuant to Section 4G.
The Administrator will also remit, or arrange for remittance, to each
Participating Broker the proportionate share of the net proceeds from
the sale of Participating Shares from that broker's Enrolled Broker's
Account. Each Participant who is a Record
-3-
<PAGE>
Owner and Participating Brokers will be informed in writing of the
number of shares sold for such Participant or for such Participating
Brokers, and the weighted average selling price, as well as any other
pertinent information. Remittance shall be by check mailed (in the
case of a Record Owner) to his or her address of record or other
address supplied by him or her and (in the case of a Participating
Broker) to such Participating Broker's address for such purposes, or
in either case by any other means established by the Administrator in
accordance with common practice.
4. Miscellaneous.
A. Compliance with Law. The implementation of the Plan shall, in all
instances, be subject to the requirements of applicable laws and
regulations.
B. Administration. The Plan will be administered by a Plan
Administrator, which initially shall be the Company's designated stock
transfer agent.
C. Limitations on Manner of Sale. Notwithstanding any provision of the
Plan or of any agreement implementing the Plan to the contrary:
(1) It is intended that in respect of all sales of Stock in the
market under the Plan, the Administrator and the Plan Broker will act
independently of the Company;
(2) Such sales, to the extent possible, will not be a
distribution under the Securities Act of 1933 or Rule 10b-6 of the
Exchange Act;
(3) Implementation of the Plan shall not constitute a tender
offer by the Company or any entity controlled by the Company,
controlling the Company or under common control with the Company
("Affiliate") under the Exchange Act;
(4) Neither the Company, Administrator, any Affiliate of the
Company nor the Plan Broker will engage in any "special selling
efforts" within the meaning of Rule 10b-6 or otherwise under the
Exchange Act;
(5) Neither the Company, Administrator, any Affiliate of the
Company nor the Plan Broker will make any arrangements with any
broker-dealer regarding prospective purchases of Participating Shares
or the manner in which Participating Shares will be sold;
(6) Neither the Company nor any Affiliate of the Company may
exercise any direct or indirect control or influence over the times
when, or the prices at which, the Plan Broker arranges for the sale of
Participating Shares in the market, the amounts to be sold or the
manner in which such shares are to be sold, or the selection of a
broker or dealer through which sales are executed, and all such
activities shall be carried out as provided in the Plan and as
authorized and directed by Enrollment Forms executed by Enrolled
Accounts and Enrolled Brokers' Accounts;
-4-
<PAGE>
(7) No purchases of securities will be made for the purpose of
creating actual or apparent active trading or affecting the price of
any publicly traded security.
D. Brokerage Commissions. The Plan Broker will charge a fixed
brokerage commission fee of $.05 per a share for each Participating Share
sold. The Plan Broker will credit the Plan, for the account of each
Participant, with the net proceeds received by the Plan Broker, net of such
brokerage commission, without deduction for any additional commission,
discount, mark up, mark down, spread, expense or other compensation. No
change in such brokerage commission can be made except by the mutual
consent of the Plan Broker and the Company evidenced by a writing signed by
both and delivered to the Administrator before June 1 of the year prior to
the Plan Year during which such change will be effective.
E. Costs and Expenses. The Administrator will charge no brokerage fees
in connection with the sale of any shares sold pursuant to this Plan. The
Company will pay all of the administrative expenses relating to the Plan,
including any fees and expenses of the Administrator, but will not bear the
expense of any brokerage commissions.
F. Transactions Between Brokers and Customers. Neither the
Administrator nor the Company shall have any responsibility or liability
resulting from the failure of a Participating Broker to remit documents,
information, funds, securities, or other property to its Participating
Customers or for any errors or omissions of a Participating Broker in
connection with the Plan.
G. Forms 1099 and Withholding. The Administrator will issue and
distribute all required Forms 1099 and any other forms or reports required
by any taxing authority having jurisdiction over transactions by a holder
of an Enrolled Account, Participating Broker, or Participating Customer in
the Plan. The Administrator is authorized to withhold any funds required to
be withheld by any United States or foreign taxing authority having
jurisdiction in the premises.
H. Modification, Suspension, or Termination. The Company reserves the
right to modify, suspend, or terminate the Plan at any time provided that
no such modification, suspension, or termination shall adversely affect the
right of each Participant under the Plan either to receive payment for any
Participating Shares which have been delivered to the Plan Broker for sale
or, in the alternative, to receive delivery of such shares.
I. Severability. If any part of the Plan is determined to be invalid
or void in any respect, such termination will not affect, impair,
invalidate, or nullify the remaining provisions of the Plan which will
continue in full force and effect.
J. Extent of Authorization. The authorization to sell Stock dividends
shall only cover quarterly Stock dividends payable in shares of Stock to
holders of Stock at a quarterly rate of 4% or less and shall not apply to
any other dividend, stock split, or distribution of cash, securities,
rights, or other property, unless specifically provided in the Enrollment
Form or unless such other distribution and the Stock dividend are part of
an integral transaction and the Company so designates at the time of
declaration of the Stock dividend in question.
-5-
<PAGE>
KNAPE & VOGT MANUFACTURING COMPANY
STOCK DIVIDEND SALE PLAN
1. "Administrator" means a person, committee, or entity appointed to
administer the Plan.
2. "Affiliate" means any entity controlled by the Company, controlling the
Company or under common control with the Company.
3. "Eligible Customers" means owners of Common Stock or Class B Common Stock
held by Participating Brokers.
4. "Eligible Stockholders" means collectively Record Owners and Participating
Brokers acting on behalf of Eligible Customers.
5. "Enrolled Account" means each account which completes an Enrollment Form
and returns it timely to the Administrator. Unless the context requires
otherwise, the term "Enrolled Account" also includes the registered owner
of such account and the shares of Enrolled Stock held by such account at
the time in question.
6. "Enrolled Brokers' Account" means an account consisting of all shares of
Stock owned by the Participating Customers whom a Participating Broker has
enrolled in the Plan. As of each record date, each Participating Broker
will advise the Administrator of the number of shares of Stock then owned
by Participating Customers. Unless the context requires otherwise, the term
"Enrolled Brokers' Account" also includes the owner of shares included in
such account and the shares designated by the Participating Broker as
comprising such account at the time in questions.
7. "Enrolled Stock" means as of any date during the Plan Year, shares of Stock
held as of such date by (1) an Enrolled Account and designated on the
Enrollment Form as Enrolled Stock or (2) an Enrolled Broker's Account. If
no designation is made as to the number of shares of Enrolled Stock, all
Stock held in an Enrolled Account will be deemed to be Enrolled Stock.
8. "Enrollment Form" means the form provided by the Company, or, as to
Participating Brokers, such other form as is satisfactory to the
Administrator, by which Record Owners and Eligible Customers participate in
the Plan and direct the sale under the Plan of Stock dividends.
9. "Exchange Act" means Securities Exchange Act of 1934.
10. "Participant" means each Enrolled Account and each Enrolled Brokers'
Account.
11. "Participating Brokers" means brokers and other custodial institutions
holding Stock who establish procedures which permit their customers to
participate in the Plan if they so desire.
-6-
<PAGE>
12. "Participating Customer" means a customer of a Participating Broker whose
account has been enrolled in the Plan by the Participating Broker acting on
behalf of his customers.
13. "Participating Shares" means shares of Stock payable as a Stock dividend on
Enrolled Stock as of any record or payment date for such Stock dividend.
14. "Plan Broker" means a brokerage firm acting on behalf of the Participants.
15. "Plan Year" means a fiscal year (July 1 through June 30) of the Company
during which the Plan is in effect.
16. "Record Owners" means all registered owners of Stock reflected on the stock
transfer records maintained by or on behalf of the Company.
17. "Stock" or "stock" means shares of Common Stock and/or shares of Class B
Common Stock which are outstanding or will be outstanding.
::ODMA\PCDOCS\GRR\191167\1
-7-
<PAGE>
EXHIBIT 10.2
KNAPE & VOGT MANUFACTURING COMPANY
STOCK DIVIDEND SALE PLAN ENROLLMENT FORM
IMPORTANT: RETURN THIS ENROLLMENT FORM ONLY IF YOU WISH TO BE ENROLLED IN THE
STOCK DIVIDEND SALE PLAN ("PLAN") BEING OFFERED TO SHAREHOLDERS. THE SUMMARY
PLAN DESCRIPTION IS A DETAILED DESCRIPTION OF THE PLAN, IS INCORPORATED BY
REFERENCE, AND SHOULD BE READ BEFORE SIGNING THIS ENROLLMENT FORM.
I (OR WE, IF SHARES ARE HELD JOINTLY), REFERRED TO HEREIN AS "HOLDER,"
AUTHORIZE AND INSTRUCT THE PLAN ADMINISTRATOR, HARRIS TRUST AND SAVINGS BANK
("HARRIS TRUST"), TO SELL THROUGH THE PLAN BROKER ALL SHARES OF COMMON STOCK
("SHARES") RECEIVABLE BY HOLDER AS STOCK DIVIDENDS IN THE ACCOUNT IDENTIFIED ON
THE REVERSE SIDE OF THIS ENROLLMENT FORM. THIS AUTHORIZATION AND INSTRUCTION
APPLIES TO ALL STOCK DIVIDEND SHARES WITH RESPECT TO ALL SHARES REGISTERED IN
THE ACCOUNT UNLESS A LESSER NUMBER OF SHARES IS SPECIFIED IN THE SPACE PROVIDED
ON THE REVERSE SIDE. HOLDER DIRECTS HARRIS TRUST TO REMIT QUARTERLY TO HOLDER
(AT THE ADDRESS OF RECORD INDICATED ON THE REVERSE SIDE OF THIS ENROLLMENT FORM)
THE NET CASH PROCEEDS OF THE SALE OF HOLDER'S STOCK DIVIDEND SHARES. FOR
DESIGNATED PLAN ENROLLMENT PERIODS, PLEASE REFER TO THE SUMMARY PLAN
DESCRIPTION.
HOLDER APPOINTS HARRIS TRUST AS ATTORNEY-IN-FACT, WITH FULL POWER OF
SUBSTITUTION, TO ACT ON HOLDER'S BEHALF AND IN HOLDER'S NAME, AND TO DO ALL ACTS
NECESSARY TO CARRY OUT THE SALES OF STOCK DIVIDEND SHARES.
ALL AUTHORITY AND POWERS OF ATTORNEY HEREIN CONFERRED SHALL SURVIVE
HOLDER'S DEATH OR INCAPACITY AND ARE IRREVOCABLE POWERS COUPLED WITH AN
INTEREST. ALL OBLIGATIONS OF HOLDER HEREUNDER SHALL BE BINDING UPON THE HOLDER'S
HEIRS, LEGATEES, PERSONAL REPRESENTATIVES, SUCCESSORS AND ASSIGNEES.
HOLDER UNDERSTANDS THAT PARTICIPATION IN THE PLAN IS SUBJECT TO ALL TERMS
AND CONDITIONS OF THE PLAN WHICH ARE SUMMARIZED IN THE SUMMARY PLAN DESCRIPTION
ENCLOSED WITH THIS ENROLLMENT FORM.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
========================================
THIS IS NOT A DIVIDEND REINVESTMENT FORM
========================================
<PAGE>
KNAPE & VOGT MANUFACTURING COMPANY
STOCK DIVIDEND SALE PLAN ENROLLMENT FORM
TO BE ENROLLED IN THE PLAN, A SIGNED ENROLLMENT FORM MUST BE RETURNED FOR
EACH ACCOUNT. THE HOLDER'S FAILURE TO PROVIDE EITHER A SOCIAL SECURITY NUMBER OR
TAX IDENTIFICATION NUMBER IN THE SPACE BELOW MAY RESULT IN A BACK-UP WITHHOLDING
OF 31 PERCENT OF ANY CASH PAYMENT MADE TO HOLDER. UNLESS OTHERWISE SPECIFIED
BELOW, THIS AUTHORIZATION AND INSTRUCTION RELATES TO ALL STOCK DIVIDEND SHARES
RECEIVABLE WITH RESPECT TO ALL SHARES REGISTERED IN THE ACCOUNT IDENTIFIED
BELOW.
TO ENROLL IN THE PLAN, A SIGNED ENROLLMENT FORM MUST BE MAILED TO HARRIS
TRUST AND SAVINGS BANK, 311 WEST MONROE, CHICAGO, IL 60606, IN THE
SELF-ADDRESSED ENVELOPE PROVIDED. PLEASE SIGN BELOW.
DATE___________________________
SIGNATURE(S_______________________________
__________________________________________
SOCIAL SECURITY NUMBER____________________
--OR--
TAX IDENTIFICATION NUMBER_________________
THIS AUTHORIZATION AND INSTRUCTION RELATES ONLY TO STOCK
DIVIDEND SHARES RECEIVABLE WITH RESPECT TO THE FOLLOWING
SHARES REGISTERED IN THIS ACCOUNT. (CHECK ONE):
[ ] ALL or [ ] ________________ shares
(fill in number)
PLEASE SIGN EXACTLY AS NAME(S) APPEAR TO THE LEFT. IF JOINT
ACCOUNT, EACH JOINT OWNER MUST SIGN AND PROVIDE SOCIAL
SECURITY NUMBER OF OWNER LISTED FIRST IN REGISTRATION ABOVE.
EXECUTORS, TRUSTEES, ETC., SHOULD GIVE FULL TITLE.
::ODMA\PCDOCS\GRR\202344\1
<PAGE>
EXHIBIT 10.3
FORM OF AGREEMENT WITH PLAN ADMINISTRATOR
September ___, 1998
Harris Trust and Savings Bank
311 West Monroe
Chicago, IL 60606
RE: Knape & Vogt Manufacturing Company
Stock Dividend Sale Plan
Ladies and Gentlemen:
This letter will serve to confirm the appointment of Harris Trust and
Savings Bank ("Harris") as Trustee and as Plan Administrator under the Knape &
Vogt Manufacturing Company ("KV") Stock Dividend Sale Plan (the "Plan") which
will be made available to holders of record of Common Stock and Class B Common
Stock of KV (and beneficial owners whose shares are held by Participating
Brokers), beginning with the stock dividend paid to these stockholders in the
fourth calendar quarter of 1998. Unless otherwise defined in this letter
agreement or the context otherwise requires, terms defined in the Plan shall
have the same meaning in this Agreement.
A. The duties of Harris as Trustee will be to act in name only for KV's Stock
Dividend Sale Plan, as all other duties are to be performed by Harris as
Plan Administrator.
B. The duties of the Plan Administrator will be:
1. To receive, review and retain Enrollment Forms received from Enrolled
Accounts and from Participating Brokers advising of the Enrolled
Brokers' Accounts which they have enrolled on behalf of their
Customers, and properly to process, record and maintain the
information contained therein as permanent records of the Plan.
Page 1 of 5
<PAGE>
2. To advise the Plan Broker of the number of shares of Enrolled Stock
held of record by Enrolled Accounts and the number of shares held by
Enrolled Brokers' Accounts.
3. To request in a timely fashion the necessary information from the
transfer agent for the Stock, the Plan Broker and all Participating
Brokers and to maintain up-to-date records of the number of shares of
Enrolled Stock as of each record date which will reflect (as of such
record date) any increases or decreases in the shares of Enrolled
Stock held of record by Enrolled Accounts on the stock transfer
records maintained by or on behalf of KV and, based on advice from
Participating Brokers, in the shares of Enrolled Stock held by
Enrolled Brokers' Accounts.
4. Promptly after each record date for a Stock dividend, to notify the
Plan Broker of the number of shares of Enrolled Stock as of such
record date.
5. Upon receipt of advice from the Plan Broker as to the number of
Participating Shares sold and to be settled as of each settlement
date, delivery of certificates for shares to the Plan Broker against
payment therefor.
6. Upon receipt of the information from the Plan Broker after completing
of the sale of all Participating Shares, giving the number of shares
sold, the prices at which sold and the aggregate proceeds from the
sale of shares, to calculate the entitlement of each Enrolled Account
and each Enrolled Brokers' Account and pay to each such Enrolled
Account and Enrolled Brokers' Account.
7. Distribute the net cash proceeds of the sale ("Plan Fund") to each
Enrolled Account and Enrolled Brokers' Account and to prepare checks
(or other method of payment) distributing the Plan Fund to such
Enrolled Accounts and Enrolled Brokers' Account and arrange for
delivery of such checks (or other form of payment) and any appropriate
information statements.
8. To prepare and maintain records to reflect the tax information
required by all applicable tax laws and regulations and to prepare
Form 1099s or any other appropriate information form required by
United States or any other applicable tax laws or regulations.
Page 2 of 5
<PAGE>
9. Generally, to comply with the duties and responsibilities of the Plan
Administrator as stated herein and in the Plan.
C. KV shall pay any expenses incurred by the Plan Administrator in the
performance of its duties, including fees for legal services rendered to
the Plan Administrator, and such compensation to the Plan Administrator as
may be agreed upon in writing from time to time between KV and the Plan
Administrator, and all other proper charges and disbursements of the Plan
Administrator. The Plan Administrator and KV have agreed that the fee which
has been agreed upon between KV and Harris for the latter's services as
stock transfer agent will include its services as Plan Administrator under
the Plan and that no additional fees will be charged by Harris for services
rendered in such additional capacities.
D. KV will advise the Plan Administrator of all relevant particulars of each
declaration of a stock dividend on Stock of KV (including specification of
the record date, percentage rate for such stock dividend and the payment
date) and direct the transfer agent for its Stock to advise the Plan
Administrator of the number of shares of Enrolled Stock held as to the
record date for the payment of stock dividends.
E. The Plan Administrator shall discharge its duties under this Agreement
solely in the interest of the Participants in the Plan and (i) with the
care, skill, prudence, and diligence under the circumstances that a prudent
person acting in a like capacity and familiar with such matters would use
in the conduct of an enterprise of a like character and with like aims, and
(ii) in accordance with the provisions of this Agreement and the Plan. The
duties and obligations of the Plan Administrator as such shall be limited
to those expressly imposed upon it by this Agreement and the terms of the
Plan.
1. The Plan Administrator shall not be liable for the taking of any
action pursuant to or for any loss not resulting from the Plan
Administrator's own willful misconduct, bad faith or negligence.
2. KV shall indemnify and hold the Plan Administrator harmless against
all expenses, losses, claims, damages or liabilities, joint or
several, to which the Plan Administrator may become subject insofar as
such expenses, losses, claims, damages, or liabilities (or actions in
respect thereof) arise out of are based upon compliance with any
written direction of KV (including, but not limited to, any obligation
to effect a transaction in Stock) or pursuant to an act performed by
the Plan
Page 3 of 5
<PAGE>
Administrator under this Agreement. KV shall reimburse the Plan
Administrator for any legal or other fees reasonably suffered or
incurred by the Plan Administrator in connection with investigating or
defending any such action or claim. KV shall have no liability
hereunder to the extent any such expense, loss, claim, damage or
liability results from willful misconduct, bad faith or negligence on
the part of the Plan Administrator.
3. The Trustee and Plan Administrator may be removed by KV at any time
upon 90 days' notice in writing to the Trustee and Plan Administrator.
The Trustee and Plan Administrator may resign effective at the
beginning of a Plan Year by giving written notice to KV, on or before
March 1 of the year preceding such Plan Year. Upon such removal or
resignation of the Trustee and Plan Administrator, KV shall appoint a
successor Trustee and Plan Administrator who shall have the same
powers and duties as those conferred upon the Trustee and Plan
Administrator hereunder.
4. KV reserves the right at any time and from time to time instruct the
Trustee and Plan Administrator to amend the provisions of this
Agreement by notice thereof in writing delivered by KV to the Trustee
and the Plan Administrator; provided that no such amendment which
materially and adversely affects the rights or materially increases
the duties or responsibilities of the Trustee or the Plan
Administrator may be made without its consent, and provided further
that no such amendment shall authorize or permit any part of the Plan
Fund assets to be used for or diverted to purposes other than for the
exclusive benefit of the Participants or shall otherwise adversely
affect the Participants.
5. Unless otherwise defined herein or the context otherwise, requires
terms defined in the Plan shall have the same meaning in this
Agreement, and the provisions of the Plan, as the same shall be in
effect from time to time, are incorporated in and made a part of this
Agreement.
Page 4 of 5
<PAGE>
6. This Agreement shall be administered, construed and enforced according
to the laws of the State of Illinois.
If the foregoing reflects your agreement, please so indicate by
countersigning this letter in the space provided below.
Very truly yours,
KNAPE & VOGT MANUFACTURING
COMPANY STOCK DIVIDEND SALE PLAN
By: Harris Trust and Savings Bank
As Trustee
By: ______________________________________
Its: __________________________________
CONFIRMED:
KNAPE & VOGT MANUFACTURING
COMPANY
By: ______________________________________
Its:___________________________________
AGREED:
HARRIS TRUST AND SAVINGS BANK,
as Plan Administrator
By: ___________________________
Its: ____________________
::ODMA\PCDOCS\GRR\203424\1
Page 5 of 5
<PAGE>
EXHIBIT 10.4
FORM OF AGREEMENT WITH PLAN BROKER
September ___, 1998
Credit Suisse First Boston
227 West Monroe Street
Chicago, Illinois 60606
Re: Knape & Vogt Manufacturing Company
Stock Dividend Sale Plan
Ladies and Gentlemen:
We are writing to confirm our understanding regarding your appointment and
duties as the Plan Broker selected to implement the Knape and Vogt Manufacturing
Company Stock Dividend Sale Plan ("Plan"), a copy of which is attached. The
Plan, as the same shall be in effect from time to time, is incorporated herein
and made a part of this letter. Unless otherwise defined herein or the context
otherwise requires, terms defined in the Plan shall have the same meaning in
this letter.
1. The Company plans to commence the practice of declaring and paying
quarterly stock dividends on its Common Stock and its Class B Common Stock
("Stock"). The Plan Administrator under the Plan will make arrangements to
distribute Enrollment Forms for the Plan to the record holders of Stock and to
Participating Brokers. In order to enroll in the Plan, Eligible Stockholders and
Participating Brokers (acting on behalf of their Customers) will complete and
mail the Enrollment Forms to the Plan Administrator. Such Enrollment Forms will
appoint the Plan Administrator as agent of the Enrolled Accounts and Enrolled
Brokers' Accounts and will direct the sale of all Participating Shares received
as a stock dividend on Enrolled Stock held by such accounts. Promptly after the
record date established for the purposes of determining those holders of Stock
entitled to receive payment of a stock dividend, the Plan Administrator will
advise you of the number of Participating Shares included in such stock dividend
which will be sold on an agency basis on behalf of the Enrolled Accounts and
Enrolled Brokers' Accounts, the payment date for such shares and other relevant
information concerning such stock dividend.
<PAGE>
Credit Suisse First Boston
September ___, 1998
Page 2
2. The undersigned has been appointed as Plan Administrator under the Plan
and has been authorized and directed, as agent for the Participants, to (a)
receive from the Company's transfer agent a stock certificate or certificates
representing, for each stock dividend, the Participating Shares, (b) to deliver
such certificates to you against payment therefor, and (c) to distribute the net
proceeds of such sales to the Participants.
3. With respect to each stock dividend, the Plan Administrator will confirm
the instructions contained in the Enrollment Forms and direct you to sell on an
agency basis on behalf of the Enrolled Accounts and Enrolled Brokers' Accounts
the number of Participating Shares which the Plan Administrator will advise you
are included in such stock dividend. Such sales will be carried out promptly, to
the extent possible, commencing no earlier than the third trading day preceding
the dividend payment date, so that payment of the net proceeds may be made to
the Participants as soon as is feasible after the stock dividend payment date.
4. As Plan Broker, you understand the need for compliance with the
provisions of Section 4A and the limitations on the manner of sale contained in
Section 4C of the Plan and agree to comply with such provisions and limitations.
5. After the close of trading on each day on which you effect sales of
Participating Shares you will advise the Plan Administrator of the number of
shares sold and the prices at which such shares were sold, the number of shares
sold at each price, and the date upon which delivery of certificates to you for
shares sold is required. You will pay the Plan Administrator on each settlement
date for each sale the aggregate amount of the proceeds received for the sale of
such shares which are being settled on such settlement date, net of a commission
to you of $.05 per share. No other commissions, mark ups, mark downs, spreads,
expenses or other compensation will be charged by you as Plan Broker. You will
cooperate with the Plan Administrator in complying with any applicable
withholding or similar tax laws or regulations or any applicable stock transfer
tax requirements.
6. The Plan, with the consent of the Company, may terminate this
appointment at any time on four months written notice to you. You may resign
effective at the end of any Plan Year by giving written notice to the Plan
Administrator on or before March 1 of such Plan Year.
<PAGE>
Credit Suisse First Boston
September ___, 1998
Page 3
7. You are authorized to act upon the instructions of the Plan
Administrator with respect to matters involving the Plan.
If the foregoing represents our understanding, please so indicate in the
space provided below.
Very truly yours,
KNAPE & VOGT MANUFACTURING
COMPANY STOCK DIVIDEND SALE PLAN
By Harris Trust and Savings Bank
As Plan Administrator
By: __________________________________
Its: _____________________________
CONFIRMED:
KNAPE & VOGT MANUFACTURING
COMPANY
By: __________________________________
Its: _____________________________
AGREED:
CREDIT SUISSE FIRST BOSTON
By: __________________________________
Its: _____________________________
::ODMA\PCDOCS\GRR\203425\1
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Knape & Vogt Manufacturing Company
We hereby consent to incorporation by reference in the Prospectus constituting a
part of the registration statement of our report dated August 7, 1998, except
for Note 13, as to which the date is August 31, 1998, relating to the
consolidated financial statements and schedule of Knape & Vogt Manufacturing
Company appearing in the Company's Annual Report on Form 10-K for the fiscal
year ended June 30, 1998.
We also consent to the reference to us under the caption "Experts" in the
Prospectus.
/s/ BDO SEIDMAN, LLP
Grand Rapids, Michigan
September 29, 1998
::ODMA\PCDOCS\GRR\204975\1
