<PAGE>
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 (S)240.14a-11(c) or (S)240.14a-12
BUSH INDUSTRIES, INC.
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
BUSH INDUSTRIES, INC.
- - --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14a.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (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:
-----------------------------------------------------------------------
Notes:
<PAGE>
BUSH INDUSTRIES, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 22, 1996
TO ALL STOCKHOLDERS OF BUSH INDUSTRIES, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Bush
Industries, Inc., a Delaware corporation, will be held at the principal office
of the Company, One Mason Drive, Jamestown, New York 14702, on Wednesday, May
22, 1996 at 10:00 a.m., New York time, for the following purposes:
1. To elect ten Directors, three of whom will be Class A Directors elected
by the holders of Class A Common Stock and seven of whom will be Class B
Directors elected by the holders of Class B Common Stock, for the term
of one year and until their successors are duly elected and qualified;
2. To ratify the appointment of Deloitte & Touche LLP, as the Company's
independent public accountants for the fiscal year ending December 28,
1996; and
3. To transact such other business as may properly come before the Annual
Meeting or any adjournment or adjournments thereof.
Only stockholders of record at the close of business on April 11, 1996, are
entitled to notice of and to vote at the Annual Meeting or any adjournments
thereof.
By Order of the Board of Directors,
Ernest C. Artista,
Secretary
Jamestown, New York
April 16, 1996
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE PROMPTLY
COMPLETE, SIGN AND DATE THE ENCLOSED PROXY, WHICH IS SOLICITED BY THE BOARD OF
DIRECTORS OF THE COMPANY, AND RETURN IT TO THE COMPANY. THE PROXY MAY BE
REVOKED AT ANY TIME BEFORE IT IS VOTED, AND STOCKHOLDERS EXECUTING PROXIES MAY
ATTEND THE MEETING AND VOTE IN PERSON, SHOULD THEY SO DESIRE.
<PAGE>
BUSH INDUSTRIES, INC.
ONE MASON DRIVE
JAMESTOWN, NEW YORK 14702
----------------
PROXY STATEMENT
The accompanying proxy is solicited by the Board of Directors of Bush
Industries, Inc. (the "Company") for the Annual Meeting of Stockholders of the
Company to be held at the principal office of the Company, One Mason Drive,
Jamestown, New York 14702, on Wednesday, May 22, 1996 at 10:00 a.m., New York
time. All proxies duly executed and received will be voted on all matters
presented at the Annual Meeting in accordance with the instructions given by
such proxies. In the absence of specific instructions, proxies so received
will be voted for the named nominees relating to the class of Common Stock for
which the proxy relates for election to the Company's Board of Directors and
for the ratification of Deloitte & Touche LLP, as the Company's independent
public accountants. The Board of Directors does not anticipate that any of its
nominees will be unavailable for election and does not know of any other
matters that may be brought before the Annual Meeting. In the event that any
other matter should come before the Annual Meeting or that any nominee is not
available for election, the persons named in the enclosed proxy will have
discretionary authority to vote all proxies not marked to the contrary with
respect to such matter in accordance with their best judgment. The proxy may
be revoked at any time before being voted. The Company will pay the entire
expense of soliciting the proxies, which solicitation will be by use of the
mails. This Proxy Statement is being mailed to stockholders on or about April
16, 1996.
Only holders of shares of Class A Common Stock and Class B Common Stock of
record at the close of business on April 11, 1996 will be entitled to notice
of and to vote at the Annual Meeting and at all adjournments thereof. As of
the close of business on April 11, 1996, the Company had outstanding 5,975,956
shares of Class A Common Stock and 2,570,247 shares of Class B Common Stock.
At the Annual Meeting, the holders of Class A Common Stock will be entitled,
as a class, to elect three Directors ("Class A Directors"), and the holders of
Class B Common Stock will be entitled, as a class, to elect seven Directors
("Class B Directors"). The vote of a majority of the Class A shares of Common
Stock represented at the Annual Meeting is required for the election of the
Class A Directors, and the vote of a majority of the Class B shares of Common
Stock represented at the Annual Meeting is required for the election of the
Class B Directors. The vote of a majority of the shares of capital stock
represented at the Annual Meeting, voting as a single class and after taking
into account that each holder of Class A Common Stock is entitled to one-tenth
vote per share of Class A Common Stock, and each holder of Class B Common
Stock is entitled to one vote per share of Class B Common Stock, is required
for the ratification of the appointment of Deloitte & Touche LLP, as the
Company's independent public accountants.
Shares represented by proxies which are marked "abstained" or which are
marked to deny discretionary authority will only be counted for determining
the presence of a quorum. Votes withheld in connection with the election of
one or more of the nominees for Director will not be counted as votes cast for
such individuals. In addition, where brokers are prohibited from exercising
discretionary authority for beneficial owners who have not provided voting
instructions (commonly referred to as "broker non-votes"), those shares will
not be included in the vote totals.
A list of the stockholders entitled to vote at the Annual Meeting will be
available at the Company's office, One Mason Drive, Jamestown, New York 14702,
for a period of ten (10) days prior to the Annual Meeting for examination by
any stockholder.
Officers and Directors of the Company beneficially own approximately 20% of
the outstanding shares of Class A Common Stock and approximately 99% of the
outstanding shares of Class B Common Stock. See "Security Ownership of
Management and Principal Stockholders." Accordingly, approval of the aforesaid
matters is virtually assured.
1
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
AND PRINCIPAL STOCKHOLDERS
The following table sets forth the amount of shares of Class A Common Stock
and Class B Common Stock owned as of March 29, 1996 by each Director of the
Company, by those persons known to the Company to own beneficially 5% or more
of the outstanding shares of Class A and/or Class B Common Stock of the
Company, and by all Directors and Officers of the Company as a group. With
respect to any person who beneficially owns 5% or more of the outstanding
shares of Class A and/or Class B Common Stock, the address of such person is
also set forth.
<TABLE>
<CAPTION>
NUMBER AND NUMBER AND
PERCENTAGE OF PERCENTAGE OF
NAME AND ADDRESS SHARES OF CLASS A SHARES OF CLASS B
OF BENEFICIAL OWNER COMMON STOCK OWNED COMMON STOCK OWNED
---------------------- ---------------------- ----------------------
<S> <C> <C> <C> <C>
Paul S. Bush.............. 687,781 10.7%(1) 2,550,108 99.2%(2)
One Mason Drive
Jamestown, NY 14702
Robert L. Ayres........... 195,346 3.2%(3) --
Lewis H. Aronson.......... 84,375 1.4%(4) --
Paul A. Benke............. 421 (5) --
Jerald D. Bidlack......... 4,843 (5) --
Douglas S. Bush........... 76,056 1.3%(6) 3,307 (5)(7)
Gregory P. Bush........... 100,998 1.7%(8) 13,525 (5)(9)
Robert E. Hallagan........ -- --
Donald F. Hauck........... 59,094 1.0%(10) --
David G. Messinger........ 173,564 2.8%(11) --
Bush Industries, Inc.
Savings and
Retirement Plan.......... 452,166 7.6% --
One Mason Drive
Jamestown, NY 14702
All Officers and Directors
as a group (12 persons).. 1,425,840 20.3%(12)(13) 2,566,940 99.9%
</TABLE>
- - --------
(1) Includes 450,000 shares of Class A Common Stock issuable upon exercise of
outstanding options. In addition, includes 194,704 shares of Class A
Common Stock held as custodian and/or in trust for the benefit of Mr.
Paul S. Bush's children, and with respect to which Mr. Paul S. Bush
disclaims beneficial ownership. Excludes 6,669 shares of Class A Common
Stock held of record by the Company's Savings and Retirement Plan (the
"401(k) Plan") for the benefit of Mr. Paul S. Bush, and with respect to
such shares the trustees of such Plan have sole voting power. In
addition, excludes shares of Class A Common Stock issuable upon
conversion of shares of Class B Common Stock. Also excludes 1,653 shares
of Class A Common Stock held of record by Mr. Paul S. Bush's daughter,
Christine M. Bush, and with respect to such shares, Mr. Paul S. Bush
disclaims beneficial ownership.
(2) Includes 37,736 shares of Class B Common Stock held as custodian and/or
in trust for the benefit of Mr. Paul S. Bush's children, and with respect
to which Mr. Paul S. Bush disclaims beneficial ownership. In addition,
excludes 3,307 shares of Class B Common Stock held of record by Mr. Paul
S. Bush's daughter, Christine M. Bush, and with respect to such shares,
Mr. Paul S. Bush disclaims beneficial ownership.
(3) Includes 187,500 shares of Class A Common Stock issuable upon the
exercise of outstanding options. Excludes 4,662 shares of Class A Common
Stock held of record by the Company's 401(k) Plan for the benefit of Mr.
Robert L. Ayres, and with respect to such shares the trustees of such
Plan have sole voting power.
(4) Includes 84,375 shares of Class A Common Stock issuable upon exercise of
outstanding options. Excludes 2,863 and 631 shares of Class A Common
Stock, held of record by the Company's 401(k) Plan for the benefit of Mr.
Lewis H. Aronson and his spouse, respectively, and with respect to such
shares, the trustees
2
<PAGE>
of such Plan have sole voting power. Also excludes 600 shares of Class A
Common Stock issuable to Mr. Lewis H. Aronson's spouse upon the exercise of
outstanding options owned of record by Mr. Aronson's spouse, and with
respect to which Mr. Aronson disclaims beneficial ownership.
(5) Less than 1%.
(6) Includes 68,332 shares of Class A Common Stock issuable upon exercise of
outstanding options. Excludes 860 shares of Class A Common Stock held of
record by the Company's 401(k) Plan for the benefit of Mr. Douglas S.
Bush, and with respect to such shares the trustees of such Plan have sole
voting power. Excludes shares of Class A Common Stock issuable upon
conversion of shares of Class B Common Stock beneficially owned by Mr.
Douglas S. Bush. Excludes 33,280 shares of Class A Common Stock held in
trust for the benefit of Mr. Douglas S. Bush, and with respect to which,
such shares have been included in the total number of shares of Class A
Common Stock beneficially owned by Mr. Paul S. Bush. See Note (1) above.
In addition, excludes 2,093 shares of Class A Common Stock held in trust
for the benefit of Messrs. Gregory P. and Douglas S. Bush's mother, and
with respect to such shares, Mr. Douglas S. Bush disclaims beneficial
ownership. Such shares have been included in the total number of shares of
Class A Common Stock beneficially owned by Mr. Gregory P. Bush. See Note
(8) below.
(7) Excludes 8,343 shares of Class B Common Stock held in trust for the
benefit of Mr. Douglas S. Bush and with respect to which, such shares have
been included in the total number of shares of Class B Common Stock
beneficially owned by Mr. Paul S. Bush. See Note (2) above.
(8) Includes 2,093 shares of Class A Common Stock held in trust for the
benefit of Messrs. Gregory P. and Douglas S. Bush's mother, and with
respect to such shares, Mr. Gregory P. Bush disclaims beneficial
ownership. Includes 65,625 shares of Class A Common Stock issuable upon
exercise of outstanding options. Excludes 1,685 shares of Class A Common
Stock held of record by the Company's 401(k) Plan for the benefit of Mr.
Gregory P. Bush, and with respect to such shares the trustees of such Plan
have sole voting power. Excludes shares of Class A Common Stock issuable
upon conversion of shares of Class B Common Stock beneficially owned by
Mr. Gregory P. Bush.
(9) Includes 1,875 shares of Class B Common Stock held in trust for the
benefit of a minor child of Mr. Gregory P. Bush, and with respect to such
shares, Mr. Gregory P. Bush disclaims beneficial ownership.
(10) Includes 15,938 shares of Class A Common Stock issuable upon the exercise
of outstanding options. Excludes 3,833 shares of Class A Common Stock held
of record by the Company's 401(k) Plan for the benefit of Mr. Donald F.
Hauck, and with respect to such shares the trustees of such Plan have sole
voting power. In addition, excludes 2,093 shares of Class A Common Stock
held in trust for the benefit of Messrs. Gregory P. and Douglas S. Bush's
mother, and with respect to such shares Mr. Hauck disclaims beneficial
ownership. Such shares have been included in the total number of shares of
Class A Common Stock beneficially owned by Mr. Gregory P. Bush. See Note
(8) above.
(11) Includes 560 shares of Class A Common Stock held as custodian by Mr. David
G. Messinger for his minor children, and with respect to such shares Mr.
Messinger disclaims beneficial ownership. Includes 131,250 shares of Class
A Common Stock issuable upon exercise of outstanding options. Excludes
4,875 shares of Class A Common Stock held of record by the Company's
401(k) Plan for the benefit of Mr. Messinger, and with respect to such
shares the trustees of such Plan have sole voting power.
(12) Includes shares of Class A Common Stock issuable upon exercise of
outstanding options, as described in the Notes above. In addition,
includes shares of Class A Common Stock beneficially owned by Mr. Ernest
C. Artista and Mr. Neil A. Frederick, the Company's Secretary and
Treasurer respectively. Excludes shares of Class A Common Stock issuable
upon conversion of outstanding shares of Class B Common Stock. Excludes
shares held of record by the Company's 401(k) Plan, as described in the
Notes above. In addition, excludes shares of Class A Common Stock issuable
to the spouses of certain Officers upon exercise of outstanding options.
(13) In calculating the percentage of shares of Class A Common Stock owned,
included in the total number of shares of Class A Common Stock outstanding
are the shares of Class A Common Stock issuable upon exercise of
outstanding options, as described in the foregoing Notes.
3
<PAGE>
ELECTION OF DIRECTORS
Ten (10) Directors are to be elected for the ensuing year and until their
successors are duly elected and qualified. Three of such Directors will be
Class A Directors, elected by the holders of the Class A Common Stock, and
seven of such Directors will be Class B Directors, elected by the holders of
the Class B Common Stock. If, at the time of election, any of the nominees
should be unavailable for election, a circumstance which is not expected by
the Company, it is intended that the proxies will be voted for such substitute
nominee as may be selected by the Company. Proxies not marked to the contrary
will be voted for the election of the following persons with respect to that
class of Common Stock represented thereby. All of the nominees are standing
for re-election by the stockholders, except for Mr. Douglas S. Bush who was
elected a member of the Board of Directors in November 1995 by action of the
Board of Directors.
<TABLE>
<CAPTION>
NAME AND AGE DIRECTOR SINCE POSITION WITH THE COMPANY
------------ -------------- -------------------------
<S> <C> <C>
NOMINEES FOR CLASS A
DIRECTORS
Paul A. Benke (74)........... 1985 Director
Jerald D. Bidlack (60)....... 1985 Director
Robert E. Hallagan (52)...... 1993 Director
NOMINEES FOR CLASS B
DIRECTORS
Paul S. Bush (59)............ 1965 Chairman of the Board,
President, Chief Executive Officer
Robert L. Ayres (52)......... 1988 Executive Vice President,
Chief Operating Officer,
Chief Financial Officer and
Director
Lewis H. Aronson (44)........ 1993 Vice President of Corporate
Development and Director
Douglas S. Bush (29)......... 1995 Vice President of
Merchandising and Director
Gregory P. Bush (31)......... 1993 Vice President of
Administration and New
Business Development and
Director
Donald F. Hauck (52)......... 1981 Senior Vice President and
Director
David G. Messinger (46)...... 1988 Senior Vice President of Sales
and Marketing and Director
</TABLE>
Mr. Paul A. Benke has served as a Director of the Company since 1985. In
1982, Mr. Benke founded the Roger Tory Peterson Institute, a not-for-profit
environmental education institute, and is titled "Founder". He served as its
President from 1995 to 1996 and as its Executive Vice President/Executive
Director from 1991 through 1995. Prior thereto, from 1981 to 1991, he was
President of Jamestown Community College. From 1973 to 1981, he served with
the Marine Products Group of AMF Incorporated, a manufacturer of industrial
and recreational products, in various managerial capacities, including Vice
President, Group Executive and Assistant to the Executive Vice President for
Leisure Products.
Mr. Jerald D. Bidlack has served as a Director of the Company since 1985.
Mr. Bidlack has been President of Griffin Automation, Inc., West Seneca, New
York since 1992, a designer and manufacturer of automation equipment. For more
than five years prior to 1992, he was Vice Chairman of Moog, Inc., East
Aurora, New York, a manufacturer of servocontrols, and President of its
International Group. He also serves as a Director of Graham Corporation of
Batavia, New York.
4
<PAGE>
Mr. Robert E. Hallagan has served as a Director of the Company since 1993.
Mr. Hallagan has been the President and Chief Executive Officer of Heidrick &
Struggles, Inc. since 1991. Heidrick & Struggles, Inc. is an international
executive search firm with more than 200 consultants in 34 offices worldwide.
Previous to joining Heidrick & Struggles, Inc. in 1977, he was Executive Vice
President and Treasurer of the Boston Stock Exchange and of Hawthorne
Securities. Mr. Hallagan also serves on the Board of Directors of Corco, APT
and Citizens Mortgage Investment Company.
Mr. Paul S. Bush has been with the Company since it was founded in 1959. He
has been President and Chief Executive Officer since 1971. Mr. Paul S. Bush
serves on the Board of Directors of the American Furniture Manufacturers
Association of High Point, North Carolina. He is the father of Messrs. Gregory
P. and Douglas S. Bush.
Mr. Robert L. Ayres joined the Company as Executive Vice President on
February 15, 1988. He has been Chief Operating and Chief Financial Officer
since July 1, 1991. He joined the Company after 22 years with Rockwell
International Corporation where he held several senior management positions in
engineering, manufacturing and administration with its Automotive Operations.
Mr. Lewis H. Aronson joined the Company as Vice President of Human Resources
on February 1, 1988. Since January 1992, he has been Vice President of
Corporate Development. From July 1991 to January 1992, he was Vice President
of Organizational Development. He joined the Company after ten years with
Rockwell International Corporation, where he held a variety of human resource
management positions for its Automotive Operations.
Mr. Douglas S. Bush joined the Company on January 20, 1990 upon graduating
from the State University of New York at Buffalo with a Bachelors Degree in
Business Administration. He commenced his service as a Marketing Analyst and
was promoted to Director of Customer Service in October 1992. He was appointed
to Vice President of Retail Operations in December 1994 and was promoted to
Vice President of Merchandising in January 1996. He is the son of Mr. Paul S.
Bush and the brother of Mr. Gregory P. Bush.
Mr. Gregory P. Bush joined the Company on June 19, 1988 upon graduating from
the State University of New York, College at Fredonia with a Bachelors Degree
in Business Administration. He commenced his service as a Manufacturing
Supervisor, and was promoted to Manager of Group Packing in January 1989. He
became Director of Management Information Services in 1989, and was made Vice
President of that department in 1991. Mr. Gregory Bush became Vice President
of Administration on January 1, 1992, and has served as the Vice President of
Administration and New Business Development since January 1996. He is the son
of Mr. Paul S. Bush and the brother of Mr. Douglas S. Bush.
Mr. Donald F. Hauck has been employed by the Company since 1971. He has held
a variety of senior management positions with the Company. From 1986 to 1991,
he was Chief Financial Officer. During 1986 he was Vice President of Finance,
during 1987 he was Executive Vice President of Administration, and from 1988
to 1991, he was Senior Vice President of Finance. From 1982 through 1993, he
served as Secretary of the Corporation, and since 1993 he has been Senior Vice
President.
Mr. David G. Messinger has been employed by the Company since 1975 and has
held the position of Senior Vice President of Sales and Marketing since
January 1990. He was Senior Vice President of Product/Process Development from
January 1988 to December 1989. From 1986 to 1988, he was Vice President of
Engineering/Research/Development. Prior to 1986, Mr. Messinger held a variety
of positions in the Operations, Manufacturing and Engineering functions.
5
<PAGE>
The business background of the following Executive Officers of the Company,
to the extent not otherwise set forth herein, are described below:
Mr. Ernest C. Artista (44) was elected Secretary of the Company in November
1995. Mr. Artista joined the Company in January 1988 and has held a variety of
management positions with the Company, including Director of Human Resources,
a position which he currently holds. He joined the Company after ten years
with Rockwell International Corporation, where he held a variety of human
resource management positions for its Automotive Operations.
Mr. Neil A. Frederick (43) was elected Treasurer of the Company in May 1995.
Mr. Frederick joined the Company in April 1988 and has held a variety of
management positions with the Company, including Director of Finance and
Banking, a position which he currently holds. He joined the Company after ten
years with Rockwell International Corporation, where he held a variety of
financial management positions for its Automotive Operations.
MEETINGS OF THE BOARD OF DIRECTORS
AND INFORMATION REGARDING COMMITTEES
The Board of Directors has two standing committees, an Audit Committee and a
Compensation Committee. The Company does not have a Nominating Committee.
The Audit Committee is composed of Messrs. Paul A. Benke (Chairman), Jerald
D. Bidlack and Robert E. Hallagan. The duties of the Audit Committee include
recommending the engagement of independent auditors, reviewing and considering
actions of Management in matters relating to audit functions, reviewing with
independent auditors the scope and results of its audit engagement, reviewing
reports from various regulatory authorities, reviewing the system of internal
controls and procedures of the Company, and reviewing the effectiveness of
procedures intended to prevent violations of law and regulations. The Audit
Committee held one meeting in 1995.
The Compensation Committee is comprised of Messrs. Jerald D. Bidlack
(Chairman), Paul A. Benke and Robert E. Hallagan. The duties of the
Compensation Committee include recommending to the Board of Directors
remuneration to be paid to Executive Officers of the Company, determining the
number of shares and options to be awarded pursuant to the Company's stock
plan, administering and monitoring compensation, including administering the
Company's Performance Bonus Plan, and recommending the establishment of
incentive and bonus programs for executives of the Company. The Compensation
Committee held three meetings in 1995.
The Board of Directors held three meetings in 1995. All Directors attended
at least 75% of the meetings of the Board of Directors and Committees on which
they served.
EXECUTIVE COMPENSATION
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
All decisions on the compensation of the Company's Executive Officers are
made by the Compensation Committee of the Board of Directors (the
"Committee"). Grants or awards of stock options or shares of the Company's
Class A Common Stock to Executive Officers are made solely by the Committee in
compliance with the requirements of Rule 16b-3, promulgated under the
Securities Exchange Act of 1934.
The Company's executive compensation program is designed to help attract,
retain, and motivate the highly qualified personnel needed to ensure maximum
stockholder returns. To meet these goals, the Company has implemented a
compensation program with the following components:
. Base salaries that reflect the scope and responsibilities of the
position, as well as the skills, knowledge, experience, abilities, and
contributions of each individual executive.
. Short term incentives that are directly linked to the financial
performance of the Company.
. Long term incentives that balance the Executive Officer's short and long
term perspectives and provide rewards consistent with stockholder
returns.
6
<PAGE>
All decisions regarding individual compensation for the Company's Executive
Officers and executive compensation programs are reviewed, discussed, and
approved by the Committee and/or are recommended to the Board of Directors or
stockholders for approval, as appropriate. All compensation decisions are
determined following a detailed review and assessment of external competitive
data, the individual's contributions to the Company's success, any significant
changes in role or responsibility, and internal equity of pay relationships.
The competitiveness of the Company's total compensation program--
incorporating base salaries, short term incentives, and long term incentives--
is assessed regularly, and where appropriate, with the assistance of outside
compensation consultants. In general, the Committee intends that the overall
compensation level for the executive group should reflect competitive levels
of compensation for comparable positions in similarly sized manufacturers of
consumer durables over the long term.
The Company believes that Executive Officers should be rewarded for their
contribution to the financial success and profitability of the business, and
as such, in 1994, the Company implemented, with stockholder approval, a
Performance Bonus Plan. Under the Performance Bonus Plan, actual bonus amounts
for each Executive Officer are based on a formula which multiplies the
Executive Officer's base salary by the Company's pretax, pre-bonus profits as
a percentage of sales and a factor reflecting the Executive Officer's relative
responsibilities and ability to impact the Company's profits. All Executive
Officers, including the Chief Executive Officer, participate in the
Performance Bonus Plan. In addition, the Committee and the Board of Directors
occasionally approve special bonuses in recognition of extraordinary
achievements that have provided significant benefits to the stockholders of
the Company.
The Company believes that it is essential to link executive and stockholder
interests. To meet this objective, the Company administers a stock option
program which provided grants on a regular, though not necessarily annual,
basis to provide participants with an opportunity to share in the Company's
success. In determining stock option grants, the Committee considers the
externally competitive market, the past contributions of the individual, the
individual's ability to affect Company profitability, the scope of the
individual's responsibilities, and the need to retain the individual's service
over time. All Executive Officers, including the Chief Executive Officer, are
eligible to participate in this program.
1995 EXECUTIVE COMPENSATION
The base salaries of the named Executive Officers remained unchanged in 1995
from year-end 1994. Bonuses to all Executive Officers, including Mr. Paul S.
Bush, are primarily a function of payouts under the formula-based Company
Performance Bonus Plan, as described above.
Jerald D. Bidlack, Chairman
Paul A. Benke
Robert E. Hallagan
7
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
-------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
---------------------------- --------------------- ---------
SECURITIES LONG
OTHER RESTRICTED UNDERLYING TERM
ANNUAL STOCK OPTIONS/ INCENTIVE ALL OTHER
NAME AND SALARY BONUS COMPENSATION AWARDS SARS PAYOUTS COMPENSATION
PRINCIPAL POSITION YEAR ($) ($) ($)(1) ($) (#)(2) ($) ($)(3)(4)
- - ------------------------ ---- ------- ------- ------------ ---------- ---------- --------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Paul S. Bush ........... 1995 450,000 537,300 4,309 -- -- -- 305,769(5)
Chairman, President, 1994 450,000 581,850 3,135 -- -- -- 518,051(5)
Chief Executive Officer 1993 450,000 459,000 6,915 -- 450,000 -- 421,322(5)
Robert L. Ayres ........ 1995 290,000 258,700 -- -- -- -- 77,965(5)
Exec. Vice President, 1994 290,000 280,150 974 -- -- -- 160,746(5)
Chief Operating
Officer, 1993 260,000 170,450 3,452 -- 187,500 -- 97,398(5)
Chief Financial Officer
David G. Messinger...... 1995 200,000 139,300 -- -- -- -- 4,155
Sr. Vice President-- 1994 200,000 150,850 137 -- -- -- 26,353
Sales & Marketing 1993 175,000 89,250 855 -- 131,250 -- 26,207
Lewis H. Aronson........ 1995 160,000 95,520 -- -- -- -- 4,108
Vice President-- 1994 160,000 103,440 196 -- -- -- 34,010
Corporate Development 1993 132,000 71,597 1,224 -- 84,375 -- 31,451
Gregory P. Bush ........ 1995 101,000 40,198 1,049 -- -- -- 2,915
Vice President-- 1994 99,154 43,531 124 -- -- -- 22,415
Administration & New 1993 91,181 35,695 838 -- 65,625 -- 18,930
Business Development
</TABLE>
- - --------
(1) Represents imputed income from non interest-bearing loans.
(2) As adjusted for the 5-for-4 stock split effectuated by the Company in the
form of a twenty-five percent dividend on January 20, 1995 and the 3-for-2
stock split effectuated by the Company in the form of a fifty percent
dividend on January 7, 1994.
(3) Includes Company contribution to the Savings and Retirement Plan (401(k)).
In 1995, such contributions were $5,077 for Mr. Paul S. Bush, $5,400 for
Mr. Ayres, $4,155 for Mr. Messinger, $4,108 for Mr. Aronson, and $2,915
for Mr. Gregory P. Bush. In 1994, such contributions were $5,250 for Mr.
Paul S. Bush, $5,310 for Mr. Ayres, $5,000 for Mr. Messinger, $4,200 for
Mr. Aronson, and $2,975 for Mr. Gregory P. Bush. In 1993, such
contributions were $6,965 for Mr. Paul S. Bush, $6,837 for Mr. Ayres,
$5,244 for Mr. Messinger, $2,635 for Mr Aronson, and $1,824 for Mr.
Gregory P. Bush.
(4) Includes special bonuses awarded in 1994 and 1993 by the Company, a
portion of which was used to retire outstanding indebtedness to the
Company. The amount of such bonuses for 1994 were $210,139 for Mr. Paul S.
Bush, $113,894 for Mr. Ayres, $21,353 for Mr. Messinger, $29,810 for Mr.
Aronson and $19,440 for Mr. Gregory P. Bush. The amount of such bonuses
for 1993 were $110,194 for Mr. Paul S. Bush, $60,019 for Mr. Ayres,
$20,963 for Mr. Messinger, $28,816 for Mr. Aronson, and $17,106 for
Mr. Gregory P. Bush.
(5) Includes premiums paid by the Company with respect to split-dollar life
insurance policies for Mr. Paul S. Bush and Mr. Ayres. The Company will be
reimbursed to the extent of the premiums paid, and expects to receive such
payments upon the earlier of the death of the participant, or November 1,
2002 for Mr. Paul S. Bush and December 19, 2009 for Mr. Ayres. Premiums in
1995 were $300,692 for Mr. Paul S. Bush and $72,565 for Mr. Ayres.
Premiums in 1994 were $302,662 for Mr. Paul S. Bush and $41,542 for Mr.
Ayres. Premiums in 1993 were $304,163 for Mr. Paul S. Bush and $30,542 for
Mr. Ayres.
8
<PAGE>
AGGREGATED OPTIONS/SAR EXERCISES IN THE LAST FISCAL YEAR AND FISCAL YEAR-END
OPTIONS/SAR VALUE
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF SECURITIES IN-THE-MONEY
UNDERLYING UNEXERCISED OPTIONS/SARS AT FISCAL
SHARES OPTIONS/SARS AT FISCAL YEAR-END
ACQUIRED VALUE YEAR-END (#) $(000)
ON REALIZED ------------------------- -------------------------
NAME EXERCISE $(000) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Paul S. Bush............ -- -- 225,000 225,000 1,407 1,407
Robert L. Ayres......... -- -- 46,875 140,625 293 880
David G. Messinger...... -- -- 32,813 98,437 205 616
Lewis H. Aronson........ -- -- 21,094 63,281 132 396
Gregory P. Bush......... -- -- 16,406 49,219 103 308
</TABLE>
COMPENSATION OF DIRECTORS
Directors who are not employees of the Company were paid an annual fee of
$10,000 and a fee of $1,000 for each meeting of the Board of Directors and for
Committee meetings not held in conjunction with Board meetings.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS
The Executive Officers named in the Summary Compensation Table, except for
Mr. Gregory P. Bush, have employment agreements with the Company which provide
for a rolling three-year term of employment. Effective as of January 1, 1996,
the base salaries payable on an annualized basis under the agreements are as
follows: Mr. Paul S. Bush $525,000; Mr. Robert L. Ayres $340,000; Mr. David G.
Messinger $250,000; and Mr. Lewis H. Aronson $200,000. The agreements also
provide that upon termination of an executive's employment due to disability,
the executive will receive the severance payments he would have received upon
termination of his employment by the Company without good cause, reduced by
the benefits that he may receive under any short term disability and long term
disability plans provided by the Company. In addition, in the case of Mr. Paul
S. Bush and Mr. Robert L. Ayres, the agreements provide for the continuation
of certain split dollar life insurance arrangements with the Company, despite
termination of their employment by the Company without good cause, until they
reach age 65.
Pursuant to the agreements, if the executive's employment with the Company
is terminated without good cause during the term of his agreement, the
executive will be entitled to severance pay equal to the compensation and
benefits he would have been paid, absent such termination, for a number of
months specified as follows: Mr. Paul S. Bush (36 months); Mr. Robert L. Ayres
(36 months); Mr. David G. Messinger (12 months); and Mr. Lewis H. Aronson (12
months).
Under each of the agreements, if the executive terminates his employment
after a substantial adverse alteration in the nature and status of the
executive's responsibilities or duties following a change in control of the
Company (as defined in the agreements), or if the Company terminates the
executive's employment without good cause following a change in control of the
Company, the executive will be entitled to severance pay equal to the
compensation and benefits he would have been paid during the next 36 months,
or in the case of Mr. Paul S. Bush, the next 48 months. The compensation
payable to an executive upon a "change in control" will be reduced, if
necessary, to assure that the payments would not constitute "excess parachute
payments" under the Internal Revenue Code of 1986, as amended.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No member of the Compensation Committee was an officer or employee of the
Company or of any of its subsidiaries during the prior year or was formerly an
officer of the Company or of any of its subsidiaries. None of the Executive
Officers of the Company have served on the Board of Directors or Compensation
Committee during the last fiscal year of any other entity, any of whose
officers served either on the Board of Directors of the Company or on the
Compensation Committee of the Company.
9
<PAGE>
CERTAIN INDEBTEDNESS
The Company has loaned money to certain of its Executive Officers from time
to time on a non-interest bearing basis to facilitate the purchase of stock
from the Company, and for other reasons. Mr. Paul S. Bush was the only
Executive Officer named in the Company's Summary Compensation Table, with
indebtedness in excess of $60,000 outstanding at any time during 1995. The
largest amount of said indebtedness during 1995 for Mr. Paul S. Bush was
$71,516, and as of March 29, 1996, Mr. Paul S. Bush owed the Company $67,188.
Imputed interest on loans to named Executive Officers is reflected in the
Summary Compensation Table under the column "Other Annual Compensation".
COMPARISON OF TOTAL STOCKHOLDER RETURN
The following graph sets forth total stockholder returns for the New York
Stock Exchange, the S&P Household Furnishings Index, and the Company for the
five-year period beginning January 1, 1991 and ending January 1, 1996. Total
stockholder returns for the graph assumes that $100 was invested at the
beginning of the period, and that all dividends were reinvested.
[PERFORMANCE GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
- - ----------------------------------------------------------------------------
1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96
- - ----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Bush Industries, Inc. $100.00 $225.00 $219.60 $781.70 $780.90 $941.80
- - ----------------------------------------------------------------------------
New York Stock Exchange $100.00 $127.10 $133.00 $143.50 $139.00 $182.50
- - ----------------------------------------------------------------------------
S&P Household Furnishings $100.00 $140.30 $159.50 $239.80 $196.40 $236.50
- - ----------------------------------------------------------------------------
</TABLE>
10
<PAGE>
The preceding sections entitled "Report of the Compensation Committee on
Executive Compensation" and "Comparison of Total Stockholder Returns" do not
constitute soliciting material for purposes of Rule 14a-9 of the Securities
and Exchange Commission (the "Commission"), will not be deemed to have been
filed with the Commission for purposes of Section 18 of the Securities
Exchange Act of 1934, and are not to be incorporated by reference into any
other filing made by the Company with the Commission.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The Company has retained, subject to stockholder ratification, Deloitte &
Touche LLP, as its independent public accountants for the fiscal year ending
December 28, 1996. Deloitte & Touche LLP has been the independent accountants
for the Company for the past twelve years and has no financial interest,
either direct or indirect, in the Company. A representative of Deloitte &
Touche LLP is expected to attend the Annual Meeting and to have an opportunity
to make a statement and/or respond to appropriate questions from stockholders.
If the stockholders do not ratify the appointment of Deloitte & Touche LLP, as
the Company's independent public accountants, the Board of Directors will
consider the selection of another accounting firm.
The vote of a majority of the shares of Class A and Class B Common Stock
represented at the Annual Meeting, voting as a single class, after giving
effect that each holder of Class A Common Stock is entitled to one-tenth vote
per share of Class A Common Stock, and each holder of Class B Common Stock is
entitled to one vote per share of Class B Common Stock, is required for the
ratification of Deloitte & Touche LLP, as the Company's independent public
accountants. The Board of Directors recommends a vote "FOR" the ratification
of the appointment of Deloitte & Touche LLP, as the Company's independent
public accountants.
CERTAIN TRANSACTIONS
The Company has entered into employment agreements with Paul S. Bush, Robert
L. Ayres, Lewis H. Aronson, and David G. Messinger. See "Executive
Compensation--Employment Contracts and Termination of Employment and Changes
in Control Arrangements." In addition, the Company has an employment agreement
with Mr. Donald F. Hauck at an annualized base salary of $112,000 which
expires on May 31, 1998. If his employment is terminated without good cause
during the term of his employment agreement, Mr. Hauck will be entitled to
severance pay through May 31, 1998, if such termination occurs before May 31,
1997, and will be entitled to 12 months severance pay if such termination
occurs after May 31, 1997. Mr. Hauck's agreement also provides that
termination of his employment resulting from the sale or liquidation of the
Company, or the discontinuance of the Company's furniture manufacturing
business, will be considered a termination without good cause.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act")
requires that the Company's Officers and Directors, and persons who own more
than ten percent of a registered class of the Company's equity securities,
file reports of ownership and changes in ownership with the Securities and
Exchange Commission. Officers, Directors and greater than ten percent
stockholders are required by regulation to furnish to the Company copies of
all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons, the Company believes
that during its 1995 fiscal year, all such filing requirements applicable to
its Officers, Directors, and greater than ten percent beneficial owners were
complied with.
11
<PAGE>
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS
Proposals of stockholders of the Company that are intended to be presented
at the Company's next Annual Meeting must be received by the Company no later
than October 21, 1996 in order for them to be included in the proxy statement
and form of proxy relating to that meeting.
By Order of the Board of Directors
Ernest C. Artista,
Secretary
Jamestown, New York
April 16, 1996
12
<PAGE>
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
BUSH INDUSTRIES, INC.
P.O. Box 460
One Mason Drive, Jamestown, NY 14702-0460
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
BUSH INDUSTRIES, INC.
The undersigned hereby appoints Paul S. Bush and Robert L. Ayres as
Proxies, each with the power to appoint his substitute, and hereby authorizes
either of them to represent and to vote, as designated hereon, all the shares of
Class A Common Stock of Bush Industries, Inc. held of record by the undersigned
on April 11, 1996 at the Annual Meeting of Stockholders to be held on May 22,
1996 at 10:00 a.m., or any adjournment(s) thereof.
THIS PROXY WILL BE VOTED AS DIRECTED, OR, IF NO CONTRARY DIRECTION IS
INDICATED, WILL BE VOTED FOR THE ELECTION OF DIRECTORS AND FOR THE RATIFICATION
OF DELOITTE & TOUCHE LLP, AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS, AND
AS SAID PROXIES DEEM ADVISABLE ON SUCH OTHER MATTERS AS MAY COME BEFORE THE
MEETING.
(Continued on reverse side)
- - --------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE>
- - --------------------------------------------------------------------------------
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN PLEASE MARK
THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED CLASS YOUR VOTES AS
A COMMON STOCKHOLDER. IF NO DIRECTION IS MADE, THIS INDICATED IN
PROXY WILL BE VOTED FOR THE FOLLOWING PROPOSALS: THE EXAMPLE [X]
1. ELECTION OF DIRECTORS
FOR all nominees WITHHOLD
listed (except as AUTHORITY
marked to the to vote for all
contrary) nominees listed
[ ] [ ]
PAUL A. BENKE, JERALD D. BIDLACK, ROBERT E.HALLAGAN
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- - --------------------------------------------------------------------------------
2. PROPOSAL TO RATIFY THE APPOINTMENT OF DELOITTE &
TOUCHE LLP, TO ACT AS THE COMPANY'S INDEPENDENT
PUBLIC ACCOUNTANTS FOR THE FISCAL YEAR ENDED
DECEMBER 28, 1996
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
TO ACT UPON SUCH OTHER MATTER OR MATTERS WHICH MAY PROPERLY COME BEFORE THE
MEETING OR ANY ADJOURNMENT OR ADJOURNMENTS THEREOF.
THIS PROXY SHOULD BE MARKED, DATED AND SIGNED BY THE STOCKHOLDER(S) EXACTLY AS
HIS OR HER NAME APPEARS HEREON, AND RETURNED PROMPTLY IN THE ENCLOSED ENVELOPE.
PERSONS SIGNING IN A FIDUCIARY CAPACITY SHOULD SO INDICATE. IF SHARES ARE HELD
BY JOINT TENANTS OR AS COMMUNITY PROPERTY, BOTH MUST SIGN.
Dated: , 1996
---------------------------
- - ---------------------------------------
Signature
- - ---------------------------------------
Signature
PLEASE MARK INSIDE BLUE BOXES SO THAT DATA PROCESSING EQUIPMENT WILL RECORD YOUR
VOTES
- - --------------------------------------------------------------------------------
FOLD AND DETACH HERE
