<PAGE> 1
AUGUST 16, 1999 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 [ X ]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)
(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
HERMAN MILLER, INC.
------------------------------------------------
(Name of registrant as specified in its charter)
(Name of person(s) filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11
(1) Title of each class of securities to which transaction
applies:
------------------------
(2) Aggregate number of securities to which transaction
applies:
------------------------
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and state how it
was determined):
---------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------
(5) Total fee Paid:
----------------------------------------------
[ ] Fee paid previously with preliminary materials
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid:
--------------------------------------
(2) Form, schedule, or registration statement no.:
---------------
(3) Filing party:
------------------------------------------------
(4) Date filed:
--------------------------------------------------
<PAGE> 2
[HERMAN MILLER LOGO]
1999
NOTICE OF 1999 ANNUAL MEETING OF SHAREHOLDERS
AND PROXY STATEMENT
August 16, 1999
Dear Shareholder:
Herman Miller, Inc.'s fiscal year ended May 29, 1999. Enclosed you will find the
1999 Annual Report and a proxy card to vote your shares. This year you may vote
your shares by mail, the Internet, or phone. We want to invite you to attend the
annual Shareholders' Meeting, scheduled for September 27, 1999. Please mail in
your reservation card or contact Robbie Kroll at 616-654-3305 if you plan to
attend.
We will be meeting at the Zeeland High School De Witt Auditorium, 3333 - 96th
Avenue, Zeeland, Michigan. (A map is enclosed.) David Nelson, Chairman of the
Board of Herman Miller, will convene the business meeting promptly at 4 p.m.
EDT. After the meeting, we will be serving hors d'oeuvres and light refreshments
to all who indicate on the reservation card they will be staying.
The Annual Report discusses our performance for fiscal 1999. If you have any
questions for us or for other senior managers, please write them on the enclosed
card and return it to us. We will answer as many questions as we can at the
meeting, and we will respond in writing to any questions we do not have time to
answer at the meeting.
During the business meeting we will elect four directors to the Board of
Directors, take action on one proposal, and transact any other business as may
come before the meeting.
We hope to see you there.
Sincerely,
/s/ Michael A. Volkema /s/ David L. Nelson
Michael A. Volkema David L. Nelson
President and Chief Executive Officer Chairman of the Board of Directors
- --------------------------------------------------------------------------------
YOUR VOTE IS IMPORTANT.
PLEASE COMPLETE, SIGN, DATE
AND PROMPTLY RETURN YOUR PROXY
CARD IN THE ENCLOSED ENVELOPE
- --------------------------------------------------------------------------------
<PAGE> 3
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
The annual meeting of the shareholders of Herman Miller, Inc.
(the "Company"), will be held at the Zeeland High School De Witt
Auditorium, 3333 - 96th Avenue, Zeeland, Michigan, on Monday, the 27th
of September, 1999, at 4 p.m. (EDT) for the following purposes:
1. To elect four directors, three each for a term of
three years, and one director for a term of one year.
2. To consider and vote upon a proposal to ratify the
appointment of Arthur Andersen LLP as independent
public accountants for the Company for the fiscal
year ending June 3, 2000.
3. To transact such other business as may properly come
before the meeting or any adjournment thereof.
Shareholders of record at the close of business on July 30,
1999, will be entitled to vote at the meeting.
Whether or not you expect to be present at this meeting, you
are urged to sign the enclosed proxy and return it promptly in the
enclosed envelope. If you do attend the meeting and wish to vote in
person, you may do so even though you have submitted a proxy.
By order of the Board of Directors
James N. DeBoer, Jr., Secretary of the Board
August 16, 1999
<PAGE> 4
HERMAN MILLER, INC.
855 East Main Avenue
P.O. Box 302
Zeeland, Michigan 49464-0302
PROXY STATEMENT DATED AUGUST 16, 1999
This Proxy Statement is furnished to the shareholders of Herman Miller,
Inc. (the "Company"), in connection with the solicitation by the Board of
Directors of proxies to be used at the Annual Meeting of Shareholders. This
meeting will be held on Monday, September 27, 1999, at 4 p.m. (EDT) at the
Zeeland High School De Witt Auditorium, 3333 - 96th Avenue, Zeeland, Michigan.
SOLICITATION OF PROXIES
Each shareholder, as an owner of the Company, is entitled to vote on
matters scheduled to come before the Annual Meeting. The use of proxies allows a
shareholder of the Company to be represented at the Annual Meeting if he or she
is unable to attend the meeting in person. The proxy card accompanying this
Proxy Statement is to be used for such purpose.
If the proxy card 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 all nominees
named in the proxy and for the proposal described in this Proxy Statement.
A proxy may be revoked prior to its exercise by (1) delivering a
written notice of revocation to the Secretary of the Company, (2) executing a
proxy at a later date, or (3) attending the meeting and voting in person.
However, attendance at the meeting does not automatically serve to revoke a
proxy.
ELECTION OF DIRECTORS
The Board of Directors has nominated J. Harold Chandler, Brian
Griffiths, Lord Griffiths of Fforestfach, and Mary V. Andringa for election as
directors, each to serve until the 2002 annual meeting. Each of the nominees
previously has been elected as a director by the Company's shareholders, except
for Ms. Andringa who was nominated by the Board to fill the vacancy created by
the retirement of Mr. William K. Brehm. Mr. Brehm will retire at the annual
meeting in accordance with the Company's Bylaws requiring a director to retire
at the annual meeting following his 70th birthday. The Board of Directors has
also nominated Thomas C. Pratt for election as a director for a one year term to
expire at the 2000 annual meeting, to replace Mr. James R. Carreker who resigned
on June 30, 1999.
The latter portion of this Proxy Statement contains more information
about the nominees. Unless otherwise directed by a shareholder's proxy, the
persons named as proxy voters in the accompanying proxy will vote for the
nominees named above. If any of the nominees become unavailable, which is not
anticipated, the Board of Directors, at its discretion, may designate substitute
nominees, in which event the enclosed proxy will be voted for such substituted
nominees. Proxies cannot be voted for a greater number of persons than the
number of nominees named.
A plurality of the votes cast at the meeting is required to elect the
nominees as directors of the Company. Accordingly, the four persons who receive
the largest number of votes cast at the meeting 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.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF ALL
PERSONS NOMINATED BY THE BOARD.
-1-
<PAGE> 5
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed Arthur Andersen LLP as independent
public accountants for the Company for the fiscal year ending June 3, 2000.
Representatives of Arthur Andersen LLP will be present at the annual meeting of
shareholders and available to respond to appropriate questions. The Arthur
Andersen LLP representatives will have the opportunity to make a statement if
they so desire.
Although the submission of this matter for approval by shareholders is
not legally required, the Board of Directors believes that such submission
follows sound corporate business practice and is in the best interests of the
shareholders. If the shareholders do not approve the selection of Arthur
Andersen LLP, the selection of such firm as independent public accountants for
the Company will be reconsidered by the Board of Directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF THE
APPOINTMENT OF ARTHUR ANDERSEN LLP AS THE COMPANY'S INDEPENDENT PUBLIC
ACCOUNTANTS.
-2-
<PAGE> 6
VOTING SECURITIES AND PRINCIPAL SHAREHOLDERS
On July 30, 1999, the Company had 80,848,604 shares of common stock
issued and outstanding, par value $.20 per share. Shareholders are entitled to
one vote for each share of common stock registered in their names at the close
of business on July 30, 1999, the record date fixed by the Board of Directors.
Votes cast at the meeting and submitted by proxy will be tabulated by the
Company's transfer agent. As of July 30, 1999, no person was known by management
to be the beneficial owner of more than 5 percent of the Company's common stock,
except as follows:
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT AND NATURE OF
BENEFICIAL OWNER BENEFICIAL OWNERSHIP PERCENT OF CLASS
<S> <C> <C>
Ariel Capital Management, Inc. 4,878,225(1) 6.03%
307 North Michigan Avenue
Chicago, Illinois 60601
</TABLE>
(1) This information is derived from notification received by the Company
from the beneficial owner, including notice that it has sole voting
power as to 4,811,825 shares and sole dispositive power as to 4,878,225
shares.
DIRECTOR AND EXECUTIVE OFFICER INFORMATION
SECURITY OWNERSHIP OF MANAGEMENT. The following table shows, as of July
30, 1999, the number of shares beneficially owned by each of the Named
Executives identified in the executive compensation tables of this Proxy
Statement and by all directors and executive officers as a group. Except as
described in the notes following the table, the following persons have sole
voting and dispositive power as to all of their respective shares.
<TABLE>
<CAPTION>
AMOUNT AND NATURE
NAMED EXECUTIVE OF BENEFICIAL OWNERSHIP(1) PERCENT OF CLASS(3)
<S> <C> <C>
Michael A. Volkema 768,785 .93%
Brian C. Walker 205,124 .25%
Andrew C. McGregor 247,770 .30%
Christopher A. Norman 165,549 .20%
Robert I. Frey 140,918 .17%
All executive officers and directors
as a group (23 persons) 3,592,292(2) 4.37%
</TABLE>
(1) Includes the following numbers of shares with respect to which the
Named Executives have the right to acquire beneficial ownership under
stock options exercisable in 60 days: Mr. Volkema - 164,300; Mr. Walker
- 83,832; Mr. McGregor - 84,358; Mr. Norman - 81,730; and Mr. Frey -
108,000. Includes the following number of shares which are restricted
and subject to certain conditions: Mr. Volkema - 240,320; Mr. Walker -
64,380; Mr. McGregor 61,980; Mr. Norman - 41,980; and Mr. Frey -
29,760.
(2) Included in this number are 1,375,125 shares with respect to which
executive officers and directors have the right to acquire beneficial
ownership under options exercisable within 60 days.
(3) Calculated based on the number of shares outstanding plus the option
shares referred to in notes (1) and (2) above.
-3-
<PAGE> 7
THE BOARD OF DIRECTORS. The information in the following table relating
to each nominee's and director's age, principal occupation or employment for the
past five years, and beneficial ownership of shares of common stock as of July
30, 1999, has been furnished to the Company by the respective nominees and
directors. Except as described in the notes following the table, the following
nominees and directors have sole voting and dispositive power as to all of the
shares set forth in the following table.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
YEAR FIRST
BECAME A SHARES PERCENT OF
NAME AND PRINCIPAL OCCUPATION AGE DIRECTOR OWNED(1) CLASS(2)
- --------------------------------------------------------------------------------------------------------------------
NOMINEES FOR ELECTION AS DIRECTORS FOR TERMS TO EXPIRE IN 2002
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
J. Harold Chandler 50 1995 29,558 .04%
Since July 1999-President and Chief Operating
Officer,
UnumProvident Corporation
(Insurance company)
From November 1993 through July 1999--Chairman,
President and Chief Executive Officer, Provident
Companies, Inc.
- --------------------------------------------------------------------------------------------------------------------
Brian Griffiths, Lord Griffiths of Fforestfach 57 1991 59,875 .07%
International Advisor, Goldman Sachs International
Limited and House of Lords, United Kingdom
(International investment banking firm)
- --------------------------------------------------------------------------------------------------------------------
Mary Andringa 49 -- 0 .00%
Since 1989--President and Chief Operating Officer,
Vermeer Manufacturing
- --------------------------------------------------------------------------------------------------------------------
NOMINEE FOR ELECTION AS DIRECTOR FOR TERM TO EXPIRE IN 2000
- --------------------------------------------------------------------------------------------------------------------
Thomas C. Pratt 63 -- 94,436 .11%
Since July 1989--President and Chief Executive
Officer
Prison Fellowship Ministries
- --------------------------------------------------------------------------------------------------------------------
DIRECTORS WHOSE TERMS EXPIRE IN 2000
- --------------------------------------------------------------------------------------------------------------------
Ruth Alkema Reister 63 1985 85,440(3) .10%
Private Investments and Civic and Charitable
Activities
- --------------------------------------------------------------------------------------------------------------------
Richard H. Ruch 69 1986 369,746(4) .45%
From July 1995 to October 1995--Chairman of the
Board,
Herman Miller, Inc.
From April 1992 to July 1995--Vice Chairman of the
Board, Herman Miller, Inc.
- --------------------------------------------------------------------------------------------------------------------
David L. Nelson 69 1972 159,283(5) .19%
Since October 1995--Chairman of the Board,
Herman Miller, Inc.
From January 1994 to October 1995--Vice President,
Customer Support, America's Region, Asea, Brown,
Boveri, Inc.
Prior to January 1994--Vice President, Customer
Satisfaction, Industry Segment, Asea, Brown, Boveri,
Inc. (Electronics manufacturer)
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
-4-
<PAGE> 8
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
YEAR FIRST
BECAME A SHARES PERCENT OF
NAME AND PRINCIPAL OCCUPATION AGE DIRECTOR OWNED(1) CLASS(2)
- --------------------------------------------------------------------------------------------------------------------
DIRECTORS WHOSE TERMS EXPIRE IN 2001
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
C. William Pollard 61 1985 113,302(6) .14%
Chairman of the Board, The ServiceMaster Company
(Management and consumer services for
health care, industrial, and educational facilities)
- --------------------------------------------------------------------------------------------------------------------
Dorothy A. Terrell 54 1997 7,405 .01%
Since February 1998--President,
Service Group, and Senior Vice President Worldwide
Sales, Natural MicroSystems Corporation
(Telecommunications technology company)
August 1991 to September 1997--President,
Sun Express, Inc., Sun Micro System, Inc.
- --------------------------------------------------------------------------------------------------------------------
Dr. E. David Crockett 63 1982 73,774 .09%
Since May 1991--General Partner, Aspen Ventures
(High-technology venture-capital firm)
- --------------------------------------------------------------------------------------------------------------------
Michael A. Volkema 43 1995 768,785(7) .93%
Since July 1995--Chief Executive Officer, Herman
Miller, Inc.
Since May 1995--President, Herman Miller, Inc.
From February 1995 to May 1995--President and
Chief Executive Officer, Coro, Inc. (a subsidiary
of Herman Miller, Inc.)
From May 1993 to September 1994--Chairman of the
Board, Meridian, Inc. (a subsidiary of Herman
Miller, Inc.)
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Shares shown for each director who is not an officer of the Company
include the following number of shares with respect to which the
director has the right to acquire beneficial ownership under options
exercisable within 60 days: 10,510 shares for Mr. Chandler; 45,000
shares for Mr. Griffiths; 44,049 shares for Ms. Reister; 24,898 shares
for Mr. Ruch; 69,532 shares for Mr. Nelson; 14,071 shares for Mr.
Pollard; 3,000 shares for Ms. Terrell; and 14,776 shares for Mr.
Crockett.
(2) Percentages are calculated based upon shares outstanding, plus shares
which the director has the right to acquire under stock options
exercisable within 60 days.
(3) Includes 2,400 shares owned by Ms. Reister's husband. Ms. Reister
disclaims beneficial ownership of these shares.
(4) Mr. Ruch's wife owns 14,700 shares, as to which Mr. Ruch disclaims
beneficial ownership. The Ruch Family Foundantion Charitable Trust owns
21,770 shares, as to which Mr. Ruch disclaims beneficial ownership.
(5) Includes 4,800 shares owned of record and beneficially by Mr. Nelson's
wife, with respect to which Mr. Nelson disclaims beneficial ownership.
(6) Includes 1,612 shares owned of record and beneficially by Mr. Pollard's
wife. Mr. Pollard disclaims beneficial ownership of these shares.
(7) Includes 164,300 shares with respect to which Mr. Volkema has a right
to acquire beneficial ownership under options exercisable within 60
days and 240,320 shares of restricted stock which are subject to
forfeiture under certain conditions.
Ms. Andringa also is a director of Norwest Wells Fargo Bank. Mr.
Chandler is also a director of UnumProvident Corporation, AmSouth Bancorporation
and Storage Technology Corp. Brian Griffiths, Lord Griffiths of Fforestfach,
also is a director of The ServiceMaster Company. Mr. Pollard also is a director
of The ServiceMaster Company and UnumProvident Corporation. Ms. Terrell also is
a director of General Mills, Inc. and Sears, Roebuck & Co.
-5-
<PAGE> 9
The Board of Directors held four meetings during the last fiscal year.
All of the directors attended at least 75 percent of the aggregate number of
meetings of the Board and the Board committees on which they served.
FINANCIAL AUDIT COMMITTEE. The Company has a Financial Audit Committee
comprised of Dr. E. David Crockett (chair) and Richard H. Ruch. The Financial
Audit Committee recommends to the Board of Directors the selection of
independent auditors and reviews the scope of their audit, their audit reports,
and any recommendations made by them. The committee approves fees paid for audit
and nonaudit services by the independent public accountants. The committee also
reviews the activities of the Company's internal auditors, determines EVA(R)
performance each year, and reviews and recommends to the Board issues concerning
the Company's dividend policies, capital expenditures, welfare benefits plans,
and other related financial matters. The committee met seven times during the
last fiscal year.
EXECUTIVE COMPENSATION COMMITTEE. The Company has an Executive
Compensation Committee comprised of J. Harold Chandler (chair) and Dorothy A.
Terrell. The Executive Compensation Committee recommends to the Board the annual
executive incentive plan, the grant of employee stock options, and the annual
remuneration of the Company's Chairman and Chief Executive Officer, and acts as
the administrative committee for the Company's employee stock option and long
term incentive plans. The committee met six times during the last fiscal year.
NOMINATING COMMITTEE. The Company has a Nominating Committee comprised
of C. William Pollard (chair) and William K. Brehm. The Nominating Committee
selects and presents to the Board candidates for election to fill vacancies on
the Board. The committee will consider nominees recommended by shareholders,
provided recommendations are submitted in writing, on or before the 60th day
preceding the date of the annual meeting, including a description of the
proposed nominee's qualifications, his or her consent to serve as a director, as
well as other required data on the nominee, and the shareholder submitting the
proposal, and other relevant biographical data, to C. William Pollard, at Herman
Miller, Inc., 855 East Main Avenue, P.O. Box 302, Zeeland, Michigan 49464-0302.
The committee met six times during the last fiscal year.
EXECUTIVE COMMITTEE. The Company has an Executive Committee comprised
of David L. Nelson (chair), William K. Brehm, C. William Pollard, Richard H.
Ruch, and Michael A. Volkema. The Executive Committee acts from time to time on
behalf of the Board in managing the business and affairs of the Company (except
as limited by law or the Company's Bylaws), and is delegated certain assignments
and functions by the Board of Directors. The Committee met six times during the
last fiscal year.
COMPENSATION OF BOARD MEMBERS AND NONEMPLOYEE OFFICERS
The Company pays a retainer to nonemployee directors at the rate of
$32,500 per year, plus $1,000 per regular meeting and $1,500 per special
committee meeting held at a time other than at the time of a Board meeting, and
$750 per committee meeting held by video or teleconference. In lieu of the
payment of all cash, directors may elect to receive a share grant, having a
market value equal to the cash retainer, up to 100% of the retainer. If a share
grant is selected, the director will receive a cash stipend of 25% of the value
of the shares granted. No other amounts are payable for service on committees of
the Board or for any other assignments that may be undertaken by a director as a
director.
In 1997, the Board established Director Stock Ownership Guidelines.
These guidelines, like those of the management team, are intended to reinforce
the importance of linking shareholder and director interests. Under these
guidelines, each director is expected to reach a minimum level of share
ownership which has a value equivalent to six (6) times the annual retainer fee
of $32,500 or a minimum total ownership valued at $195,000.
Mr. Nelson became the Chairman of the Board on October 30, 1995. For
the 12 month period ending October 1999, Mr. Nelson agreed to devote at least 80
percent of his business time to the Board of Directors for the payment of
$250,000 plus director fees, and an annual library allowance of $1,500. In
addition, he will receive an annual benefit package of $10,000.
-6-
<PAGE> 10
The Company has in effect a stock option plan, approved and adopted by
its shareholders, under which officers and directors who are not employees of
the Company or its subsidiaries are granted options to purchase shares of the
Company's common stock. Subject to certain exceptions, the options are not
exercisable until 12 months after the date of grant and expire 10 years after
the date of the grant. The option price is payable upon exercise in cash or,
subject to certain limitations, in shares of the Company's common stock already
owned by the optionee, or a combination of shares and cash. This Plan also
provides for the grant of reload options, which allows optionees to purchase
shares equal to the number of shares of common stock delivered in payment of the
exercise price (and any corresponding tax liability). As a result, reload
options may be granted automatically without any further action by the Board or
the Company. A reload option contains the same terms as the original option
except that the exercise price is required to equal the fair market value of the
Company's stock at the date of grant of the reload option.
On July 20, 1999, each director and officer of the Company who is not
an employee was granted an option to purchase 3,000 shares of the Company's
common stock at $23.50 per share, its fair market value at the date of grant.
Under this plan, a total of 30,000 options were granted to all nonemployee
directors and officers as a group.
EXECUTIVE COMPENSATION COMMITTEE REPORT
GENERAL
The Company has long recognized the importance of a well-founded
executive compensation program and the role it plays in achieving the Company's
short- and long-term objectives of promoting superior corporate performance,
creating shareholder value, and maintaining fairness and relative equity in the
compensation of and between its executives and all other employee-owners. The
Executive Compensation Committee of the Board of Directors, which currently
comprises two nonemployee directors, was established over 20 years ago to
provide an ongoing review of the executive compensation program to ensure that
it is structured and administered to support the Company's mission and strategy.
The committee is responsible for recommendations to the full Board for several
aspects of executive compensation, including the annual remuneration of the
Company's Chief Executive Officer, which includes base salary, incentive pay,
and equity-based compensation. In addition, the Committee also establishes the
performance objectives for the annual executive incentive plan which covers the
Chief Executive Officer, corporate officers, vice presidents, and directors at
each of the Company's business units. The Company's Chief Executive Officer
establishes the base salary of the Company's other executive officers.
COMPENSATION PHILOSOPHY
The Company's compensation philosophy, as formulated by the Executive
Compensation Committee and endorsed by the Board of Directors, is designed to
engender and preserve a sense of fairness and equity among employees,
shareholders and customers. Consistent with this philosophy, an Economic Value
Added ("EVA"(R)) performance measurement and incentive compensation system is
utilized. This system, which is an internal measurement of operating and
financial performance, has been shown by extensive independent market research
to more closely correlate with shareholder value than any other performance
measure.
Beginning in fiscal 1997, the incentive compensation plans of corporate
officers, vice presidents, and directors at each of the Company's business units
were linked to the EVA(R)concept. Under the terms of the EVA(R) performance
system, focus is shifted from budget performance to long-term continuous
improvements in shareholder value. Each year, the EVA(R) target is raised over
the actual EVA(R) earned the prior year by an improvement factor so that higher
EVA(R) targets must be attained in order to earn the same level of incentive
pay. This improvement factor is established by the Board of Directors for a
period of three years. At last year's Annual Meeting, the Company's shareholders
approved the Company's Incentive Cash Bonus Plan which utilizes this EVA(R)
performance measurement system to determine the amount of annual cash bonus
compensation.
-7-
<PAGE> 11
The Committee believes that the utilization of the EVA(R) measurement
system, with its focus on maximizing the Company's return on capital investments
relative to its cost of capital, will be a more effective means of evaluating
and rewarding management performance. The Committee believes the adoption of the
EVA(R) measurement system is consistent with its objective of endorsing an
executive compensation program designed to:
- Link a material portion of annual compensation directly to
operating performance.
- Promote achievement of long-term strategic goals and
objectives.
- Align the interests of executives with the long-term interests
of the shareholders.
- Attract, motivate, and retain executives of outstanding
ability.
EXECUTIVE STOCK OWNERSHIP REQUIREMENTS. The Board of Directors believes
that significant stock ownership by management is of critical importance to the
ongoing success of the Company since it closely links the interests of
management and Company shareholders. To emphasize this, the Board adopted stock
ownership requirements for approximately 160 executives, including all officers.
Under these requirements, the CEO must own shares of Company stock which have an
aggregate value of at least twelve (12) times his base salary. The other
executives must own shares with an aggregate value of between one (1) and six
(6) times their base salaries. All participants must achieve their ownership
requirement over a five to ten year period. The level of ownership and
attainment period is determined by the executive's responsibility level and
corresponding management position within the Company. Ownership for the purposes
of the guidelines is defined to include shares owned by the executives, as well
as shares held in profit sharing, 401(k) and deferred compensation accounts for
his/her benefit. Stock options are not included in the calculation of an
executive's total ownership.
The Company has several equity-based compensation plans which serve as
tools to assist executives in attaining their required levels of ownership.
These plans include (1) the 1994 Long-Term Incentive Plan, under which stock
options, restricted stock, reload options and other equity instruments may be
granted, and (2) the 1994 Key Executive Stock Purchase Assistance Plan, which
authorizes the Executive Compensation Committee to extend loans to selected
executives to acquire shares of Company stock. Under the later plan, executives
can earn repayment of a portion of the principal and interest due on these
loans, provided that certain corporate performance goals are attained. Both of
these plans have previously been approved by the Company's shareholders.
In addition to these plans, the Company has a Key Executive Deferred
Compensation Plan whereby executives can elect to defer a portion of the EVA(R)
cash bonus and have it denominated in Company stock. For 1999 the Company also
provided an incentive in the form of a premium denominated in Herman Miller
common shares equal to 30 percent of the amount deferred up to a maximum of 50
percent of the cash bonus. Each year the Committee may adjust the premium
percentage and the maximum amount of the deferral that is subject to the
premium. The Committee believes that this program provides an additional
opportunity and incentive for the key executives to increase their ownership
level in the Company. Seventeen executives were elected to participate in this
program for fiscal 1999 and deferred $2.3 million, which was invested in Company
stock and received a premium totaling $660,000, which was also invested in
Company stock.
An executive's level of participation in each of these plans is
directly related to the level of his or her ownership requirements. These plans
have been designed and are intended to be used by executives to attain their
required ownership levels and to build additional ownership. Failure by an
executive to use the plans as tools to build their stock ownership may result in
his or her reduced participation or withdrawal from further participation in the
plans.
During the past 5 years, approximately 160 executives have increased
their ownership by 1.85 million shares as a result of their participation in
these plans. Approximately 809,000 shares have been acquired by the exercise of
options, 733,000 shares through the Stock Purchase Assistance Plan, and 304,000
shares through the Deferred Compensation Plan.
-8-
<PAGE> 12
In addition to the foregoing plans, stock ownership is also made
available to all the Company's employees through the Employee Stock Purchase
Plan and various Employee Ownership and Profit Sharing Plans.
COMPANY PERFORMANCE AND EXECUTIVE COMPENSATION
The salaries of the Company's Chief Executive Officer and other
executive officers, collectively identified as the Executive Leadership Team
(ELT), are established on a performance-based evaluation system. Each executive
officer's performance, except that of the Chief Executive Officer, is evaluated
by his or her superior and reviewed by the Executive Compensation Committee.
This review considers the employee's overall performance relative to the
achievement of corporate objectives as well as individual contributions and
achievements. This committee applies this same evaluation system to the
Company's Chief Executive Officer.
For fiscal 1999, the ELT did an excellent job of navigating the
business through a difficult year for the office furniture industry, creating
$91.1 million of EVA(R), which represented an increase of $12.7 million over
fiscal 1998. However, revenue growth in 1999 slowed to 2.8%, which has
heightened the emphasis on controlling the Company's cost structure. Therefore
at the conclusion of fiscal 1999, the Executive Compensation Committee and the
ELT collectively agreed that there would be no annual base wage increases for
approximately 160 management employees participating in the EVA(R) Incentive
Cash Bonus Plan. All employees not participating in this plan were eligible for
merit increases from a pool totaling 3% of participating payroll wages.
As discussed earlier, the Company's EVA(R) measurement system, which
has been approved by the shareholders, provides the basis for determining
performance-based compensation. It is used to award annual stock options and
provides the formula for awarding cash incentive bonuses. The Executive
Compensation Committee approves an expected annual improvement in EVA(R) for
which a target bonus is paid for attaining performance which matches the annual
planned improvement factor that has been established for a 3 year period by the
Board of Directors. For the Company's Chief Executive Officer and other
executives, the EVA(R) plan is intended to motivate growth above the expected
annual improvement in EVA(R) with a straight line payoff profile offering a cash
bonus award that has a unlimited upside potential, as well as unlimited downside
potential. The potential for suffering a negative bonus is made possible because
annual bonus awards are not fully paid out but instead are banked and put at
risk, with full payout contingent upon continued successful performance.
The Executive Compensation Committee also authorizes the grant of stock
options to employees of the Company, including executive officers. Under the
EVA(R) program, the Committee initially approves a target option grant which is
then multiplied by the same bonus multiple that is applied to the target cash
bonus. However, executives are limited by an upside potential of two times the
target option grant and on the downside by a zero grant.
During fiscal 1999 Mr. Michael A. Volkema, the Company's Chief
Executive Officer, was paid a base salary and cash bonus of $500,000, and
$509,280, respectively, representing total cash compensation of $1,009,280.
Under the Key Executive Deferred Compensation Plan, Mr. Volkema elected to defer
50 percent of his EVA(R) bonus and have it denominated in Herman Miller common
stock. Mr. Volkema received a premium also denominated in Herman Miller common
stock equal to 5,777 shares which vests over a three year period.
In recognition of Mr. Volkema's performance during the prior three
years and to provide him with an additional incentive to remain with the Company
to accomplish the aggressive goals of its five-year plan, in September 1998, Mr.
Volkema was awarded a stock option to purchase 200,000 shares of the Company's
common stock. This option vests over a period of five years. In July 1999 Mr.
Volkema was also awarded a stock option grant of 56,000 shares representing a
multiple of two times his target option of 28,000. The Committee believes that
the significant ownership position created by these actions will more closely
align Mr. Volkema's interests with those of the shareholders.
The income tax laws of the United States limit the amount the Company
may deduct for compensation paid to the Company's CEO and the other four most
highly paid executives. Certain compensation that qualifies as
-9-
<PAGE> 13
"performance-based" under IRS guidelines is not subject to this limit. Stock
options granted under the Company's Long-Term Incentive Plan, as well as
compensation earned under the Company's 1994 Key Executive Stock Purchase
Assistance Plan and the Company's Incentive Cash Bonus Plan, are designed to
qualify as performance-based compensation, thereby permitting the Company to
deduct the related expenses.
J. Harold Chandler (Chair)
Dorothy A. Terrell
-10-
<PAGE> 14
SUMMARY COMPENSATION TABLE
The following table sets forth the compensation received by the Named
Executives for each of the three fiscal years ended May 29, 1999, May 30, 1998,
and May 31, 1997.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
ANNUAL COMPENSATION LONG TERM COMPENSATION
------------------------------- ---------------------------------------------
AWARDS PAYOUTS
-------------------------------- ------------
SECURITIES
RESTRICTED UNDERLYING LTIP ALL OTHER
NAME AND PRINCIPAL YEAR SALARY(1) BONUS(2) OTHER STOCK OPTIONS/SARS PAYOUTS(4) COMPENSATION(5)
POSITION ($) ($) ($) AWARDS (#)(3) ($) ($)
($)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Michael A. Volkema, 1999 500,000 509,280 -0- -0- 256,000 426,698 12,963
President & Chief Executive 1998 367,000 465,658 -0- -0- 80,000 809,377 5,643
Officer 1997 352,900 316,783 -0- -0- 80,000 631,765 4,199
- ------------------------------------------------------------------------------------------------------------------------------------
Brian C. Walker. 1999 260,000 188,684 -0- -0- 103,000 345,041 12,697
Executive Vice President, 1998 210,000 183,964 -0- -0- 40,000 160,461 6,348
Chief 1997 195,000 122,860 -0- 108,375(6) 40,000 126,092 4,724
Financial Officer and
Treasurer
- ------------------------------------------------------------------------------------------------------------------------------------
Andrew C. McGregor, 1999 230,000 347,715 -0- -0- 78,000 44,489 14,896
Executive Vice President, 1998 220,000 189,300 -0- -0- 40,000 154,308 9,598
President Herman Miller 1997 205,000 129,261 84,145 108,375(6) 40,000 125,329 7,433
Choices
- ------------------------------------------------------------------------------------------------------------------------------------
Christopher A, Norman, 1999 215,000 165,980 -0- -0- 78,000 38,351 13,077
Executive Vice President, 1998 210,000 174,444 -0- -0- 40,000 108,272 7,759
Information Services and 1997 205,000 109,793 -0- 108,375(6) 40,000 91,732 5,774
Chief Information Officer
- ------------------------------------------------------------------------------------------------------------------------------------
Robert I. Frey,(7) 1999 225,000 158,979 -0- 119,000(8) 78,000 165,376 11,692
Executive Vice President, 1998 205,000 129,729 -0- -0- 40,000 165,247 3,002
Herman Miller International 1996 115,384 56,153 57,569 -0- 28,000 110,399 -0-
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Includes amounts deferred by employees pursuant to Section 401(k) of
the Internal Revenue Code. Includes 52 weeks of compensation for all
three years, consistent with the Company's fiscal year.
(2) Represents amounts earned under the Company's Earned Share Bonus Plan
and Executive Incentive Plan, but excludes amounts foregone at the
election of the Named Executives and payable in shares of the Company's
common stock under the Key Executive Deferred Compensation Plan, as
reported in the Long-Term Incentive Plan table.
(3) The options reflected as being granted in fiscal 1997, 1998, and 1999
were awarded in the following fiscal year but relate to prior fiscal
year performance, except for fiscal 1999 grants of 200,000 for Mr.
Volkema, 75,000 for Mr. Walker, and 50,000 each for Messrs. McGregor,
Norman, and Frey as reflected in the Option Grant Table.
(4) Represents amounts earned under the Company's Key Executive Stock
Purchase Assistance Plan and applied to the repayment of loans made
thereunder.
(5) Includes amounts attributable during fiscal 1999 to benefit plans of
the Company as follows: (a) amounts contributed by the Company pursuant
to the Company's defined contribution retirement plans for the account
of Messrs. Volkema, McGregor, Walker, Norman, and Frey were $12,963;
$12,697; $13,762; $13,077; and $11,692, respectively; and (b) payments
by the Company in fiscal 1999 of premiums for life insurance for the
benefit of Mr. McGregor was $1,134.
(6) The amount represents the value of 6,000 shares of the Company's common
stock (based on the closing price on the date of grant of $18.0625)
granted to Mr. McGregor, Mr. Norman and Mr. Walker under the terms of
their respective Share Grant Agreements. Each elected to use 45% of the
grant to pay federal and state taxes, which resulted in a net receipt
of 3,300 shares to each participant. The shares are subject to
forfeiture provisions which lapse as the number of shares become vested
each year over a five- or six-year period. The minimum annual rate of
vesting is 10% of the total shares granted during the first five years
following the date of grant, with the balance vesting at the end of the
sixth year. The rate of vesting may be accelerated if certain corporate
performance goals are achieved. Dividends are payable on the restricted
shares at the same rate as dividends on the Company's common stock.
Full vesting would occur not earlier than
-11-
<PAGE> 15
fiscal 2002 and no later than fiscal 2003. At May 29, 1999, the value
of each participant's 1,980 restricted shares based on the closing
price of the Company's common stock on that date ($20.1875 per share)
equaled $39,971.
(7) Mr. Frey's employment with the Company began in November 1996.
(8) This amount represents the value of 4,000 shares of the Company's
common stock (based on the closing price on the date of grant of
$29.75) granted to Mr. Frey under the terms of his Share Grant
Agreement. He elected to use 45% of the grant to pay federal and state
taxes, which resulted in a net receipt of 2,200 shares. The shares are
subject to the same provisions described in footnote (6) above. Full
vesting would occur not earlier than fiscal 2003 and no later than
fiscal 2004. At May 29, 1999, the value of the participant's 1,760
restricted shares based on the closing price of the Company's common
stock on that date ($20.1875 per share) equaled $35,530.
OPTION GRANTS IN LAST FISCAL YEAR
The following table provides information on options granted to the
Named Executives during the year ended May 29, 1999.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
PERCENTAGE OF
NUMBER OF TOTAL OPTIONS
SECURITIES GRANTED TO EXERCISE OR GRANT DATE
UNDERLYING EMPLOYEES IN BASE PRICE EXPIRATION PRESENT
NAME OPTIONS FISCAL YEAR (PER SHARE)(4) DATE VALUE(5)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Michael A. Volkema 80,000(1) 3.74% 29.75 07/06/08 1,269,480
200,000(1)(2) 9.34% 22.00 09/29/08 2,312,700
70,312(3) 3.29% 25.19 07/08/07 933,019
- ------------------------------------------------------------------------------------------------------------------------------
Brian C. Walker 40,000(1) 1.87% 29.75 07/06/08 634,740
75,000(1)(2) 3.51% 22.50 11/25/08 901,043
34,915(3) 1.63% 25.19 07/08/07 463,312
- ------------------------------------------------------------------------------------------------------------------------------
Andrew C. McGregor 40,000(1) 1.87% 29.75 07/06/08 634,740
50,000(1)(2) 2.34% 22.50 11/25/08 600,695
34,915(3) 1.63% 25.19 07/08/07 463,312
- ------------------------------------------------------------------------------------------------------------------------------
Christopher A. Norman 40,000(1) 1.87% 29.75 07/06/08 634,740
50,000(1)(2) 2.34% 22.50 11/25/08 600,695
34,915(3) 1.63% 25.19 07/08/07 463,312
- ------------------------------------------------------------------------------------------------------------------------------
Robert I. Frey 40,000(1) 1.87% 29.75 07/06/08 634,740
50,000(1)(2) 2.34% 22.50 11/25/08 600,695
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Indicates number of shares that may be purchased pursuant to options
granted under the Company's 1994 Long-Term Incentive Plan. The Company
granted options on July 6, 1998, September 29, 1998, and November 25,
1998, totaling 1,088,249; 200,000; and 600,000 shares, respectively, to
eligible employees to the Company and its subsidiaries. In general,
options may not be exercised in full or in part prior to the expiration
of one year from the date of grant.
(2) These options are subject to vesting over a period of five years at the
rate of 10% after two years, 25% after three years, 50% after four
years, and 100% after five years.
(3) Reflects options granted pursuant to stock option reload rights
contained in certain option agreements. The rights permit employees to
receive new options if an employee exercises options by trading in
shares. The employees received new options equal to the shares that
were traded in. The reload options retain the expiration date of the
original option, but the exercise price equals the fair market value of
the Company's stock on the date of grant of the reload option. Reload
options were granted on November 4, 1998, and April 15, 1999, totaling
252,511 and 487 shares, respectively.
(4) The exercise price equals the prevailing market price of the Company's
stock on the date of grant. The exercise price may be paid in cash or
by delivery of previously owned shares, or a combination of cash and
such shares.
(5) For the options expiring on May 17, 2005, July 8, 2007, July 6, 2008,
September 29, 2008, and November 25, 2008, the values reflect standard
application of the Black-Scholes option pricing model based on (a)
expected stock price volatility of .4615, .4055, .3556, .3695, and
.3727, (b) risk free rate of return of 5.37%, 4.87%, 5.37%, 4.63%, and
4.87%, respectively, (c) a cash dividend yield of .5%, and (d) an
expected time of eight to ten years to exercise. The actual value, if
any, of the options granted is dependent upon the market values of the
Company's common stock subsequent to the date the options become
exercisable.
-12-
<PAGE> 16
AGGREGATED STOCK OPTION EXERCISES IN FISCAL 1999 AND YEAR END OPTION VALUES
The following table provides information on the exercise of stock
options during fiscal 1999 by the Named Executives and the number and value of
unexercised options at May 29, 1999.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
Number of Securities Value of Unexercised
Underlying Unexercised In the Money Options
Options at May 29, 1999 at May 29, 1999(2)
----------------------------- -------------------------------
Shares
Acquired
on Value
Name Exercise Realized(1) Exercisable Unexercisable Exercisable Unexercisable
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Michael A. Volkema 80,000 425,000 84,300 350,312 -0- -0-
Brian C. Walker 40,000 212,500 43,832 149,915 -0- -0-
Andrew C. McGregor 75,388 804,273 44,358 124,915 -0- -0-
Christopher A. Norman 40,000 212,500 41,730 124,915 -0- -0-
Robert I. Frey -0- -0- 68,000 90,000 13,727 -0-
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents the aggregate market value of shares acquired at time of
exercise, less the aggregate exercise price paid by the employee.
(2) Values are based on the difference between the closing price of the
Company's common stock on May 29, 1999 ($20.1875) and the exercise
prices of the options.
LONG-TERM INCENTIVE PLANS-AWARDS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
NAME PERFORMANCE
NUMBER OF OR OTHER
SHARES, UNITS PERIOD UNTIL
OR OTHER MATURATION
RIGHTS (#)(1) OR PAYOUT(2)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Michael A. Volkema 25,034 3 years
- ---------------------------------------------------------------------------------------------------------------------
Brian C. Walker 8,970 3 years
- ---------------------------------------------------------------------------------------------------------------------
Andrew C. McGregor 0 3 years
- ---------------------------------------------------------------------------------------------------------------------
Christopher A. Norman 7,833 3 years
- ---------------------------------------------------------------------------------------------------------------------
Robert I. Frey 7,681 3 years
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents the number of units credited to an employee's account under
the terms of the Company's Key Executive Deferred Compensation Plan
(the "Plan"). Under the terms of the Plan, participants may elect to
defer all or a portion of their EVA(R) cash incentive bonus payment.
Deferred amounts are credited in stock units, based on the value of the
Company's stock as of the end of the month in which the bonus would
have been paid to the employee. Stock units are payable only in shares
of the Company's common stock. Includes the following number of units
credited to each of the Named Executive's premium account, as described
in footnote (2): Michael A. Volkema - 5,777; Brian C. Walker - 2,070;
Andrew C. McGregor - 0; Christopher A. Norman - 1,807; and Robert I.
Frey - 1,773.
(2) Each year the Company's Executive Compensation Committee establishes
the maximum percentage of EVA(R) cash bonus that may be deferred, the
maximum amount of EVA(R) cash incentive which may be subject to a
premium percentage, and the amount of the premium percentage. For
fiscal 1999, the maximum percentage of EVA(R) bonus that is subject to
a premium percentage was 50%, and the premium percentage was
established at 30%. Stock units credited to a participant's
-13-
<PAGE> 17
account due to the premium percentage are credited to a separate
premium account, which vests at the rate of 33-1/3%, beginning on the
first anniversary of the deferral, and each anniversary thereafter,
provided that the participant is an employee of the Company. The plan
allows for accelerated vesting in the event of a participant's death,
disability, retirement or termination due to a change in control, as
defined in the Company's Plan for Severance Compensation After Hostile
Takeover, as amended and restated.
PENSION PLAN
The Company maintains a cash balance retirement income plan under which
the Company credits the account of each eligible participant each quarter with
an amount equal to 4 percent of the participant's compensation for the quarter,
subject to a maximum annual compensation of $160,000. Each quarter, a
participant's cash balance is credited with interest at the U.S. Treasury
security rate, established as of the month of April preceding each plan year, on
the previous quarter end balance. Upon retirement, and subject to completion of
at least five years of service, participants may be paid the cash balance in a
lump sum or in monthly payments for the remaining life of the participant. Under
current tax rates, annual benefits payable at retirement may not exceed
$130,000.
OTHER ARRANGEMENTS
The Company maintains a Salary Continuation Plan, which provides that
an officer's base salary (as shown in the "Salary" column of the Summary
Compensation Table) will be continued for twelve months after termination of the
officer's employment. Under this plan, benefits terminate if the officer
performs services for a competitor of the Company, and benefits are offset for
any noncompetitor payments for services. No benefits are payable under the plan
if an officer dies, retires, voluntarily terminates employment, or is terminated
for malfeasance.
-14-
<PAGE> 18
SHAREHOLDER RETURN PERFORMANCE GRAPH
Set forth below is a line graph comparing the yearly percentage change
in the cumulative total shareholder return on the Company's common stock with
that of the cumulative total return of the Standard & Poor's 500 Stock Index and
the NASD Non-Financial Index for the five year period ended May 29, 1999. The
following information is based on an annual investment of $100, on May 28, 1994,
in the Company's common stock, the Standard & Poor's 500 Stock Index and the
NASD Non-Financial Index, with dividends reinvested.
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
- -------------------------------- ------------- ------------- ------------- ------------- ------------- -------------
1994 1995 1996 1997 1998 1999
- -------------------------------- ------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
NASD Non-Financial 100 120 176 191 237 342
S&P 500 Index 100 120 154 200 261 316
Herman Miller, Inc. 100 89 129 302 470 345
- -------------------------------- ------------- ------------- ------------- ------------- ------------- -------------
</TABLE>
-15-
<PAGE> 19
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Pursuant to Section 16 of the Securities Exchange Act of 1934, the
Company's directors and officers, as well as any person holding more than 10
percent of its common stock, are required to report initial statements of
ownership of the Company's securities and changes in such ownership to the
Securities and Exchange Commission. Based upon written representations by each
director and officer, all the reports were filed by such persons during the last
fiscal year, except for one late report, each, filed by James Christenson,
Robert Dentzman, Robert Frey, David Knibbe, Rod McCowen, Andrew McGregor, Gary
Miller, Gene Miyamoto, Christopher Norman, C. William Pollard, Daniel Rosema,
Vicki TenHaken, Michael Valz, Gary VanSpronsen, Michael Volkema, and Brian
Walker, each covering one transaction.
SHAREHOLDER PROPOSALS--2000 ANNUAL MEETING
Any shareholder proposal intended to be presented at the next annual
meeting of the Company must be received by the Company at 855 East Main Avenue,
PO Box 302, Zeeland, MI 49464-0302 not later than April 18, 2000, if the
shareholder wishes the proposal to be included in the Company's proxy materials
relating to the meeting.
In addition, the Company's Bylaws contain certain notice and procedural
requirements applicable to director nominations and shareholder proposals,
irrespective of whether the proposal is to be included in the Company's proxy
materials. A copy of the Company's Bylaws has been filed with the Securities and
Exchange Commission and can be obtained from the Public Reference Section of the
Commission or the Company.
MISCELLANEOUS
If any matters, other than the matters set forth herein, properly come
before the meeting, it is the intention of the persons named in the enclosed
proxy to vote the shares thereby represented in accordance with their judgment.
The cost of the solicitation of proxies will be borne by the Company.
In addition to the use of the mails, proxies may be solicited personally or by
telephone or telegraph by a few regular employees of the Company without
additional compensation. The Company may reimburse brokers and other persons
holding stock in their names or in the names of nominees for their expenses in
sending proxy materials to the principals and obtaining their proxies.
The annual report of the Company for the fiscal year ended May 29,
1999, including financial statements, is being mailed to shareholders with this
proxy statement.
Shareholders are urged to date and sign the enclosed proxy and return
it promptly to the Company in the enclosed envelope.
Questions related to your holdings can be directed as follows:
First Chicago Trust Company of New York
PO Box 2500
Jersey City, NJ 07303-2500
Phone: 1 800 446 2617
By Order of the Board of Directors
James N. De Boer, Jr., Secretary of the Board
August 16, 1999
-16-
<PAGE> 20
[X] Please mark
your votes as in
this example.
<TABLE>
<CAPTION>
This proxy is solicited on behalf of the Board of Directors.
<S> <C> <C> <C> <C> <C> <C> <C>
For Withheld For Against Abstain
1. Election of [ ] [ ] 2. Proposal to ratify [ ] [ ] [ ] 3. At their discretion,
Directors as the appointment of the Proxies are
listed on reverse Arthur Andersen LLP authorized to vote
side. as independent upon such other
For, except vote withheld from the following auditors for the year ending business as may
nominee(s): June 3, 2000. properly come before
the meeting or
adjournment thereof.
- -----------------------------------------------
Please sign exactly as name appears hereon. Joint
owners should each sign. When signing as attorney,
executor, administrator, trustee, or guardian,
please give full title as such.
Date , 1999
------------------------------------------
Signature
-------------------------------------------
</TABLE>
FOLD AND DETACH HERE IF YOU ARE RETURNING YOUR VOTED PROXY CARD BY MAIL
(VOTE BY MAIL, INTERNET, OR PHONE)
Please follow one of the following steps to ensure your proxy card is properly
executed and returned on time to be counted:
TO VOTE BY MAIL:
1 Mark your vote relating to the nominees for director in one of the two boxes
to the right of "Election of Directors". If you wish to withhold authority to
vote for any individual nominee, write the name of each such nominees on the
line provided.
2 Mark your vote relating to Proposal 2 in one of the three boxes to the right
of the Proposal.
3 Sign at the bottom right in the space provided, exactly as your name appears
on the form. Joint owners should each sign. Also enter the date.
4 Tear off at perforation and mail the completed card with signature(s) in the
enclosed reply envelope to:
Herman Miller, Inc., PO Box 8062, Edison, NJ 08818-9342
WE ENCOURAGE YOU TO TAKE ADVANTAGE OF THE CONVENIENT NEW WAYS YOU CAN VOTE YOUR
SHARES. YOU CAN VOTE YOUR SHARES THROUGH THE INTERNET OR BY USING THE TELEPHONE.
THIS ELIMINATES THE NEED TO RETURN THE PROXY CARD.
TO VOTE BY USING THE INTERNET:
1 http:/www.eproxyvote.com/mlhr
2 Follow the instructions using your voter control number listed above and the
last four digits of your taxpayer identification number.
TO VOTE BY USING THE TELEPHONE:
1 Using a touch-tone telephone call 1-877-PRX-VOTE (799-8683).
2 Follow the prompts using your voter control number listed above and the last
four digits of your taxpayer identification number.
If you choose to vote your shares through the internet or telephone, there is no
need to mail back your proxy card.
YOUR VOTE IS IMPORTANT TO US.
[HERMAN MILLER LOGO]
<PAGE> 21
HERMAN MILLER, INC.
By signing this card, the shareholder appoints Richard H. Ruch, Michael A.
Volkema, and David L. Nelson and each of them, as attorneys, with the power of
substitution, to vote the shares of Common Stock of Herman Miller, Inc. ("the
company") held of record by the undersigned on July 30, 1999, at the Annual
Meeting of Shareholders to be held at the Zeeland High School, DeWitt
Auditorium, 3333-96th Anenue, Zeeland, Michigan on Monday, September 27, 1999.
Election of three directors, each for a term of three years, Nominees:
01) J. Harold Chandler
02) Brian Griffiths, Lord Griffiths of Fforestfach
03) Mary V. Andringa
Election of one director, for a term of one year. Nominee:
04) Thomas C. Pratt
The Proxies will vote your shares in accordance with your direction on this
card. If you do not indicate your choice on this card, the Proxies will vote
your shares "FOR" the nominees and "FOR" the proposals.
All shares votable hereby and the undersigned includes shares, if any, held for
my account in the Company's Employee Stock Ownership Plan and Employee Stock
Purchase Plan.
