American Woodmark Corporation
3102 Shawnee Drive
Winchester, Virginia 22601
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO THE SHAREHOLDERS OF
AMERICAN WOODMARK CORPORATION:
The Annual Meeting of Shareholders of American Woodmark
Corporation (the "Company") will be held at Piper's at Creekside,
Route 11 South, Winchester, Virginia, on Tuesday, August 20, 1996
at 9:00 a.m., Eastern Daylight Time, for the following purposes:
1. To elect eight directors to serve for the ensuing year;
2. To ratify the selection by the Board of Directors of
Ernst & Young LLP as independent certified public
accountants of the Company for the fiscal year ending
April 30, 1997;
3. To consider and vote upon a proposal to approve a
Stock Option Plan for employees;
4. To consider and vote upon a proposal to approve a
Shareholder Value Plan for employees; and
5. To transact such other business as may properly come
before the meeting or any adjournments thereof.
Only holders of record of shares of Common Stock at the
close of business on June 28, 1996 will be entitled to vote at
the meeting and any adjournments thereof.
Whether or not you plan to attend the meeting, please
complete the enclosed proxy, including signature and date, and
promptly return in the enclosed envelope.
You are cordially invited to attend the meeting.
By Order of the Board of Directors
CAROL LENTZ
Secretary
July 18, 1996
<PAGE>
AMERICAN WOODMARK CORPORATION
3102 Shawnee Drive
Winchester, Virginia 22601
PROXY STATEMENT
GENERAL INFORMATION
This Proxy Statement, mailed to shareholders on or about July
18, 1996, is furnished in connection with the solicitation by
American Woodmark Corporation (the "Company") of proxies in the
accompanying form for use at the Annual Meeting of Shareholders to
be held on August 20, 1996, and at any adjournments thereof. A
copy of the annual report of the Company for the fiscal year ended
April 30, 1996 is being mailed to you with this Proxy Statement.
In addition to the solicitation of proxies by mail, the
Company's officers and regular employees, without compensation
other than regular compensation, may solicit proxies by telephone,
telegraph and personal interview. The Company will bear the cost
of all solicitation.
On June 28, 1996, the date for determining shareholders
entitled to vote at the meeting, there were 7,632,081 shares of
common stock of the Company ("Common Stock") outstanding and
entitled to vote. Each such share of Common Stock entitles the
holder thereof to one vote.
Any shareholder giving a proxy may revoke it at any time
before it is voted. Proxies may be revoked by filing with the
Secretary of the Company written notice of revocation bearing a
later date than the proxy, by duly executing a later dated proxy
relating to the same shares or by attending the annual meeting and
voting in person.
<PAGE>
A proxy, if executed and not revoked, will be voted for the
election of the nominees for director named herein, for the
ratification of Ernst & Young LLP as independent certified public
accountants of the Company, for the proposed Stock Option Plan
For Employees, and for the proposed Shareholder Value Plan For
Employees unless such proxy contains specific instructions to the
contrary, in which event it will be voted in accordance with such
instructions. Abstentions will be considered as votes represented
at the annual meeting for quorum purposes, but a vote to abstain
will not be counted as a vote for or against any of the proposals.
ITEM 1 - ELECTION OF DIRECTORS
The persons named below, all of whom currently serve as
directors of the Company, have been nominated to serve as
directors until the next Annual Meeting of Shareholders and until
their successors have been elected. Other nominations may be made
from the floor at the annual meeting.
Although the Company anticipates that all of the nominees
named below will be able to serve, if at the time of the meeting
any nominees are unable or unwilling to serve, shares represented
by properly executed proxies will be voted at the discretion of
the persons named therein for such other person or persons as the
Board of Directors may designate.
<PAGE>
NOMINEES
Principal Occupation Director
During the Last Five of
Years and Directorships Company
Name Age in Public Companies Since
------------ --- ---------------------------- -------
William F. Brandt, Jr. 50 Company Chairman and Chief 1980
Executive Officer from 1995 to
present; Company Chairman and
President from 1980 to 1995.
Richard A. Graber 60 Commercial Real Estate Developer 1980
and owner of retail operations
from 1988 to present; Company
Vice President, Marketing from
1980 until retirement in 1988
Donald P. Mathias 57 Company Vice President, Assembly 1980
and Distribution from 1994 until
retirement in 1995; Company
Vice President, Operations,
from 1980 to 1994
John T. Gerlach 63 Director of MBA Program, 1980
Sacred Heart University from
1992 to present; Assistant to
the President of Sacred Heart
University from 1990 to 1992;
Adjunct Professor of Finance of
Drexel University Graduate School
of Business from 1988 to 1990;
Director, SAFE, Inc. and Uno
Restaurant Corp.
Daniel T. Carroll 70 Chairman from 1995 to present and 1986
Chairman and President from 1982 to
1995 of The Carroll Group, Inc.
(management consulting business),
Director, Aon Corporation,
A.M. Castle & Co., Comshare, Inc.,
Diebold, Inc., Wolverine World Wide,
Inc., Woodhead Industries, Inc.,
DeSoto, Inc. and Oshkosh Truck Corp.
C. Anthony Wainwright 62 Chairman of Harris, Drury, Cohen, 1987
Inc. (an advertising agency) 1995 to
present; Chairman in 1994 and Vice
Chairman and CEO from 1990 to 1994 of
Compton/Saatchi & Saatchi, Inc.(an
advertising agency); President of
the Bloom Companies, Inc. and Chief
Executive Officer of the Bloom Agency
(an advertising agency) from 1980 to
1990; Director, Gibson Greeting Inc.,
Del Webb Corp., and Specialty Retailing
<PAGE>
James J. Gosa 49 President and Chief Operating Officer 1995
from 1995 to present; Company Executive
Vice President from 1993 to 1995;
Company Vice President, Sales and
Marketing from 1991 to 1993; Vice
President Marketing and Branch Operations,
Thomas Somerville Co. 1985 to 1991
Martha M. Dally 45 Executive Vice President-Personal 1995
Products, Sara Lee Corporation
from 1994 to present; Vice President,
Personal Products from 1989 to 1993,
Sara Lee Corporation
<PAGE>
Section 16(a) of the Securities Exchange Act of 1934
requires the Company's directors and executive officers, and
persons who beneficially own more than ten percent of a
registered class of the Company's equity securities, to file
with the Securities and Exchange Commission initial reports of
ownership and reports of changes in ownership of Common Stock
and other equity securities of the Company. Officers,
directors, and greater than ten-percent shareholders are
required by SEC regulations to furnish the Company with copies
of all Section 16(a) forms they file.
To the Company's knowledge, based solely on review of the
copies of such reports furnished to the Company and written
representations that no other reports were required, during
the fiscal year ended April 30, 1996, all Section 16(a) filing
regulations were in compliance with requirements applicable to
its officers, directors, and greater than ten-percent
beneficial owners.
PRINCIPAL SHAREHOLDERS OF THE COMPANY
The following table sets forth information regarding shares
of Common Stock beneficially owned as of June 28, 1996 by (i)
each person who is known by the Company to beneficially own
more than 5% of the outstanding shares of Common Stock, (ii)
each director of the Company, (iii) each named executive
officer, and (iv) the directors and executive officers as a
group. Unless otherwise noted, each individual has sole
voting power and sole investment power with respect to the
number of shares set forth opposite his or her name. The
addresses of each person listed below who owns more than 5% of
the outstanding shares of Common Stock are: Mr. Brandt, 3102
Shawnee Drive, Winchester, Virginia 22601; Mr. Mathias, 5240
62nd Ave. South, St. Petersburg, Florida 33715; Ms. Stout,
P.O. Box 206, Cross Junction, Virginia 22625; and Mr. Graber,
1712 Handley Ave., Winchester, Virginia 22601.
Aggregate
Number Percentage
Name of Shares Owned
---------- --------- -------
William F. Brandt, Jr. (1)...... 2,357,390 30.7
Mary Jo Stout(2)................ 944,433 12.3
Richard A. Graber (3)........... 824,753 10.7
Donald P. Mathias (4)........... 570,632 7.4
David L. Blount (5)............. 165,502 2.2
James J. Gosa (6)............... 40,193 *
C. Stokes Ritchie (7)........... 23,234 *
Kent B. Guichard (8)............ 15,348 *
John T. Gerlach (9)............. 13,188 *
Daniel T. Carroll (10)........... 7,666 *
C. Anthony Wainwright (11)...... 2,287 *
Martha M. Dally ................ 0 -
All directors and executive officers
as a group (11 persons) ..... 4,020,193 52.3
*Indicates less than 1%.
<PAGE>
(1) Includes 193,611 shares held by Mr. Brandt as trustee
for the benefit of his children, 24,794 shares in the Brandt
Family Foundation, and options exercisable by Mr. Brandt for
3,333 shares. Excludes 61,952 shares held by Mr. Brandt's
wife as trustee for the benefit of their children.
(2) Includes 48,400 shares held by Ms. Stout as trustee for
the benefit of her children, 120,032 shares held by her
brother as trustee for the benefit of Ms. Stout, and 10,725
shares in the Holcomb Family Foundation.
(3) Includes 166,496 shares held by Mr. Graber as trustee
for the benefit of his children, and 13,972 shares in the
Graber Family Foundation, and options exercisable by Mr.
Graber for 2,166 shares. Excludes 35,734 shares held by Mr.
Graber's wife as trustee for the benefit of their children.
(4) Includes 203,280 shares held by Mr. Mathias as trustee
for the benefit of his children, and 365,571 in revocable
trusts for the benefit of Mr. Mathias and his spouse.
(5) Includes options exercisable by Mr. Blount for 7,167
shares.
(6) Includes options exercisable by Mr. Gosa for 11,000
shares.
(7) Includes options exercisable by Mr. Ritchie for 13,334
shares.
(8) Includes options exercisable by Mr. Guichard for 14,667
shares.
(9) Includes options exercisable by Mr. Gerlach for 1,803
shares.
(10) Includes options exercisable by Mr. Carroll for 2,166
shares.
(11) Includes options exercisable by Mr. Wainwright for
1,803 shares.
<PAGE>
CERTAIN INFORMATION CONCERNING THE
BOARD OF DIRECTORS AND ITS COMMITTEES
The Board of Directors held five regular meetings during
the fiscal year ended April 30, 1996. Each director, with the
exception of Mr. Graber attended all five meetings. Mr. Graber
attended three of the five meetings.
The Board of Directors has a Compensation Committee and an
Audit Committee. The Compensation Committee is composed of
John T. Gerlach, C. Anthony Wainwright and Martha Dally. Mr.
Gerlach serves as Chairperson of the Compensation Committee.
The Compensation Committee makes awards under and administers
the Company's Stock Option Plan and reviews the compensation
of officers of the Company. The Compensation Committee met
six times during fiscal year 1996, all committee members
attended each meeting. The Audit Committee is composed of
Daniel T. Carroll, John T. Gerlach and Richard A. Graber. Mr.
Carroll serves as Chairperson of the Audit Committee. The
Audit Committee reviews and reports to the Board with respect
to various auditing and accounting matters, including the
selection and fees of the Company's independent auditors, the
scope of audit procedures, the nature of services to be
performed by the independent auditors and the Company's
accounting practices. The Audit Committee met four times in
fiscal year 1996. All Committee members, with the exception
of Richard A. Graber attended each meeting. Mr. Graber
attended three of the four Audit Committee meetings.
The Board of Directors approved the establishment of the
Charitable Foundation for the Company during fiscal year 1995.
Mr. Graber was appointed to serve as Chairperson of the
Charitable Foundation and as such is compensated for
attendance on a basis consistent with the compensation for
meeting attendance for the Audit and Compensation Committees
of the Board. The Charitable Foundation met two times during
fiscal year 1996. Mr. Graber attended both meetings.
Non-management directors receive annual compensation of
$15,000 plus $1,000 for attendance at each Board meeting and
$500 for attendance at each Committee meeting. The Company
bears the cost of all travel associated with performance of
their responsibilities. Directors who are also officers do
not receive directors' fees.
<PAGE>
The 1995 Non-management Director Retirement Plan provides
for each non-management director to receive a credit equal to
fifty percent of the current annual retainer on the first day
of each fiscal year. Each non-management director will
receive a maximum of ten annual credits. Each non-management
director will be vested in his or her total credits received
at ten percent per year and be fully vested in all credits
after ten years. Total vested credits will be paid to
directors on the first day of each fiscal year commencing with
the year immediately following retirement from the Board.
Payments will be made in equal amounts over the same number of
years served on the Board but not to exceed ten years. For
existing directors elected in 1985 or later, provision is made
for credits earned and vesting as if the plan had been adopted
in 1989. For existing directors elected before 1985,
provision is made for credits earned as if the plan had been
adopted in 1984, vesting as if the plan had been adopted in
1989 and an increase in all limitations from ten to fifteen
years.
At the 1995 annual meeting the shareholders approved a
Stock Option Plan for Non-Employee Directors (the "1995
Directors Plan"). No options may be granted under the 1995
Directors Plan after August 31, 1999. Upon the initial
election of each non-employee director, the 1995 Directors
Plan provides the automatic allocation of an option to
purchase 1,000 shares. Each year thereafter eligible
directors received additional automatic grants of options to
acquire 1,000 shares. The exercise price for each option
granted under the 1995 Directors Plan is 100% of the fair
market value on the date of grant. Options granted under the
1995 Directors Plan have a term of four years and are
exercisable as to one-third of the shares on the first
anniversary of the date of grant and as to an additional one-
third on each succeeding anniversary. During the last fiscal
year, Messrs. Gerlach, Carroll, Wainwright, Graber, Mathias
and Ms. Dally were each granted options to purchase 1,000
shares at a price of $4.38 per share.
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
<TABLE>
SUMMARY COMPENSATION TABLE
The following table sets forth the annual and long-term
compensation for the Company's named executive officers for
fiscal 1996, 1995 and 1994.
<CAPTION>
Long-Term
Annual Compensation Compensation
------------------------------- ----------------------
Other
Name & Fiscal Annual All Other
Principal Position Year Salary Bonus Compensation Options Compensation
------------------ ---- ------- ------- --------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
William F. Brandt, Jr. 1996 $260,540 $107,041 $ 2,142(1) 0 $4,917(2)
Chairman & Chief 1995 255,200 188,750 2,182(1) 0 4,230(2)
Executive Officer 1994 238,233 68,750 0 5,000 4,013(2)
James J. Gosa 1996 189,170 77,737 1,584(3) 15,000 4,402(5)
President & Chief 1995 185,200 135,900 1,813(3) 0 5,180(5)
Operating Officer 1994 176,956 45,000 28,395(4) 0 6,134(5)
David L. Blount 1996 163,343 68,808 0 9,000 2,867(6)
Vice President, 1995 152,175 111,600 0 0 2,738(6)
Manufacturing 1994 139,962 39,875 0 2,500 2,370(6)
C. Stokes Ritchie 1996 145,200 30,056 1,594(7) 0 2,140(8)
Vice President, Sales & 1995 142,966 98,700 121,141(7) 20,000 129(8)
Marketing 1994 0 0 0 0 0
Kent B. Guichard 1996 143,144 63,147 0 5,000 2,313(10)
Vice President, Finance & 1995 137,381 101,925 0 0 1,490(10)
Chief Financial Officer 1994 92,265 28,832 47,923(9) 22,000 2,491(10)
</TABLE>
<PAGE>
(1) Company paid spouse travel.
(2) Contributions made on Mr. Brandt's behalf by the Company for
the Investment Savings Stock Ownership Plan were $3,690,
$3,604, and $3,387, for fiscal 1996, 1995 and 1994,
respectively. Company-paid premiums for group life
insurance made on Mr. Brandt's behalf were $1,227, $626, and
$625, for fiscal 1996, 1995 and 1994, respectively.
(3) Company paid spouse travel.
(4) Relocation expenses.
(5) Contributions made on Mr. Gosa's behalf by the Company for
the Investment Savings Stock Ownership Plan were $2,237, $86
and $14 for fiscal 1996, 1995 and 1994, respectively.
Company-paid premiums for group life insurance made on Mr.
Gosa's behalf were $491, $418, and $331 in fiscal 1996,
1995, and 1994, respectively. Also, as part of Mr. Gosa's
relocation, he was extended an interest-free loan.
Relocation loans are available to all Company management.
Using a 10% interest rate, the imputed savings to Mr. Gosa
were $1,674, $4,676 and $5,803 in fiscal 1996, 1995, and
1994, respectively.
(6) Contributions made on Mr. Blount's behalf by the Company for
the Investment Savings Stock Ownership Plan were $2,484,
$2,449, and $2,081 for fiscal 1996, 1995, and 1994,
respectively. Company-paid premiums for group life
insurance made on Mr. Blount's behalf were $383, $289, and
$289 in fiscal 1996, 1995, and 1994, respectively.
(7) Company-paid spouse travel of $1,594 and $1,594 in fiscal
year 1996 and 1995, respectively. Relocation expenses were
$119,547 in fiscal 1995.
(8) Contributions made on Mr. Ritchie's behalf by the Company
for the Investment Savings Stock Ownership Plan were $1,946
in fiscal 1996. Company-paid premiums for group life
insurance made on Mr. Ritchie's behalf were $194 and $129 in
fiscal years 1996 and 1995, respectively.
(9) Relocation expenses.
(10) Contributions made on Mr. Guichard's behalf by the Company
for the Investment Savings Stock Ownership Plan were $2,188,
$1,391 in fiscal 1996 and 1995, respectively. Company-paid
premiums for group life insurance made on Mr. Guichard's
behalf were $125, $99 and $50 in fiscal years 1996, 1995 and
1994, respectively. Also, as part of Mr. Guichard's
relocation, he was extended an interest-free loan.
Relocation loans are available to all Company management.
Using a 10% interest rate, the imputed savings to Mr.
Guichard was $2,441 in fiscal 1994.
<PAGE>
<TABLE>
OPTION GRANT TABLE
The following table sets forth information concerning
options granted during fiscal 1996 to the Company's named
executive officers.
<CAPTION>
Potential Realizable
Value at Assumed
Annual Rates
of Stock Price
Appreciation
Individual Grants For Option Term
-------------------------------------------------- -------------------
Number of
Securities % of Total Exercise
Underlying Options Granted or Base
Options to Employees Price Expiration
Name Granted (#) in Fiscal Year ($/Share) Date 5% ($) 10% ($)
-------- --------- --------- ------- -------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
William F. Brandt, Jr. 0 0% $ 0 $ 0 $ 0
James J. Gosa 15,000 25 4.375 11/27/99 14.143 30.457
David L. Blount 9,000 15 4.375 11/27/99 8.486 18.274
C. Stokes Ritchie 0 0 0 0 0
Kent B. Guichard 5,000 8 4.375 11/27/99 4.714 10.152
</TABLE>
The option price of shares of Common Stock covered by the
options granted under the 1986 Employee Stock Option Plan may not
be less than 100% of the fair market value of the Common Stock on
the date of the option grant (110% of fair market value if the
stock option is an incentive stock option which is granted to an
employee who is a 10% shareholder of the Company).
Options are exercisable at a rate of 33% per year beginning on
the first anniversary of the date on which the options were
granted. The options must be exercised within twelve months
after the cumulative increments equal 100%, at which time the
options expire.
<PAGE>
OPTION EXERCISES AND YEAR-END VALUE TABLE
<TABLE>
The following table summarizes options exercised during fiscal
1996 and presents the value of unexercised options held by the
Company's named executive officers at April 30, 1996.
<CAPTION>
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options Options
at FY-End (#) at FY-End ($)
Shares Acquired Value Exercisable/ Exercisable/
Name On Exercise (#) Realized $ Unexercisable Unexercisable
---------- ------------ ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
William F. Brandt, Jr. 0 $ 0 3,333 E $ 0 E
1,667 U 0 U
James J. Gosa 16,500 34,502 27,500 E 29,213 E
15,000 U 6,563 U
David L. Blount 0 0 7,167 E 13,346 E
9,833 U 3,938 U
C. Stokes Ritchie 0 0 6,667 E 0 E
13,333 U 0 U
Kent B. Guichard 0 0 14,667 E 23,914 E
12,333 U 14,145 U
</TABLE>
<PAGE>
PENSION PLAN
The Company maintains a non-contributory defined benefit
pension plan for salaried employees. The plan covers
substantially all employees who are compensated on the basis of a
salary or a commission, or both, and who meet certain age and
service requirements. Funding is determined on an actuarial
basis. Benefits are based on a percentage of a participant's
average compensation, including bonuses, for the five consecutive
calendar years in the ten years before the participant's
retirement that produce the highest compensation, and weighted
for credited service. The plan acts as a continuation of a
pension plan in effect for former employees of Boise Cascade
Corporation. If an employee was a participant in the Boise
Cascade plan, his or her benefit under the Company's plan cannot
be less than the benefit he or she would have received under the
Boise Cascade plan. The employee's benefit will be based upon
both his or her credited service under the Boise Cascade plan and
his or her credited service under the Company's plan. If an
employee has seven or more years of credited service under the
Boise Cascade plan, part of his or her benefit will be provided
by the Boise Cascade plan. The Company's plan will provide the
rest of the total benefit.
As of April 30, 1996, the credited years of service for
Messrs. Brandt, Gosa, Blount, Ritchie and Guichard were 25, 4,
19, 1, and 2, respectively.
<PAGE>
The following table illustrates the annual pension benefits
for retirement at age 65 under various levels of compensation and
years of credited service. The figures in the table assume that
the plan continues in its present form and that the participants
elect a life annuity form of benefit.
Final Average Years of Credited Service
Annual -----------------------------
Compensation 10 20 30 40
------------ ---- ---- ---- ----
$100,000........ $12,500 $25,000 $37,500 $50,000
150,000........ 18,750 37,500 56,250 75,000
200,000........ 25,000 50,000 75,000 100,000
300,000........ 37,500 75,000 112,500 150,000
325,000........ 40,625 81,250 121,875 162,500
The IRS places limits on the amount of compensation that can
be recognized under this plan as well as the maximum amount of
retirement benefit that may be paid under the plan. These limits
are indexed each year, so that the ultimate amount of benefit
actually paid will depend on the year of retirement. For
calendar year 1996, the maximum annual compensation which may be
recognized is $150,000 and the maximum amount of benefit that may
be paid is $120,000.
REPORT OF THE COMPENSATION COMMITTEE
The Company's Executive Compensation Program is designed to
assist in attracting, motivating, and retaining a senior
management team capable of assuring the Company's long-term
financial success, thereby rewarding shareholders and employees.
The Compensation Program, administered for all executives
including the Chief Executive Officer, has three primary
elements: (1) a base salary, (2) an annual incentive bonus, and
(3) incentive stock options. The Program seeks to provide total
compensation over the long-term that is sufficient to retain
those who deliver superior performance.
Base salaries for all executive officers have been
competitively established based on salaries paid for like
positions in comparable companies. These salaries are reviewed
annually. Based on a national survey of executive officers' base
pay in companies that manufacture durable goods with sales
between $100 and $250 million, the Company's executive officers
as a group, excluding the chief executive, are paid at the
average market rate. Compared to the same survey, the Company's
chief executive has a current base pay that is slightly below the
average market rate of other chief executives. As is the case
with the salaried administration policy for the entire Company,
adjustments to executive officer base salaries result from a
demonstrated increase in skill sets or from market-level changes
in comparable positions. During fiscal year 1996, the Company's
Chief Executive Officer received a 3% increase in base salary.
<PAGE>
The annual incentive bonus reflects both Company financial
performance and each executive officer's contribution to that
performance. All executive officers are eligible for an annual
bonus, with a maximum potential of one times the annual base pay
of each officer. Executive officers are eligible for incentive
bonuses only if the Company is profitable for the fiscal year.
Seventy percent of the potential bonus is based on the Company's
return on investment performance. In fiscal 1996, under this
portion of the plan, individual bonuses where paid at 20.7% of
annual salary. Thirty percent of the potential bonus is
discretionary, and is based on the Committee's subjective
evaluation of individual performance for each of the executive
officers during the fiscal year. Bonus payments, ranging from
20% to 23% of base salary, under this portion of the plan were
made for fiscal 1996. Criteria considered for the Chief
Executive Officer includes executive talent development, progress
in strategically positioning the Company, and various operating
performance measures such as sales, profitability, quality,
delivery and safety.
The Company's 1986 Employee Stock Option Plan, which was
approved by the shareholders in 1986, is designed to encourage
management to act in a manner that is consistent with the long-
term interests of the shareholders. Stock option grants reflect
the Compensation Committee's estimation of each executive
officer's present and potential contribution to the performance
of the Company, as well as the number and value of prior grants.
During fiscal 1996, stock options granted to the executive
officers in the aggregate totaled 29,000. Details can be found
in the Option Grant Table.
John T. Gerlach, Chairperson
Martha M. Dally
C. Anthony Wainwright
<PAGE>
PERFORMANCE GRAPH
Set forth below is a graph comparing the five year cumulative
total shareholder return from investing $100 on May 1, 1991 in
American Woodmark Corporation common stock, the S&P 500 index of
companies, and the S&P Home Furnishings and Appliance index of
companies:
1991 1992 1993 1994 1995 1996
American Woodmark $100.0 $100.0 $100.0 $145.6 $145.6 $124.6
S&P 500 100.0 114.0 124.5 131.1 154.0 200.4
S&P HomeFurnishings 100.0 138.0 143.8 178.6 164.8 195.7
and Appliance Index
<PAGE>
CERTAIN TRANSACTIONS
The Company leases its headquarters from Amwood Associates,
a partnership of which Messrs. Brandt, Mathias and Graber, and
Ms. Stout are the partners. The lease commenced on March 18,
1986 and has a remaining term of five years at which time it may
be cancelled by either party. Current monthly rental payments
are $31,299 per month, subject to annual increases, not to exceed
7%, based on changes in the Consumer Price Index. During the
fiscal year ended April 30, 1996, the Company made payments under
the lease in the amount of $370,000. The rent under the lease
was established by an independent appraisal and is on terms which
the Company believes are at least as favorable to the Company as
those which could be obtained from unaffiliated third parties.
ITEM 2--RATIFICATION OF SELECTION OF
INDEPENDENT PUBLIC ACCOUNTANTS
Upon the recommendation of the Audit Committee, the Board of
Directors has selected Ernst & Young LLP as independent certified
public accountants to audit the Financial Statements of the
Company for fiscal year 1997, and has directed a vote of
shareholders to be taken to ascertain their approval or
disapproval of that selection. If the shareholders do not ratify
the selection of Ernst & Young LLP, other independent auditors
will be considered by the Board of Directors.
Representatives of Ernst & Young LLP will be present at the
meeting of the Company's shareholders. Such representatives will
have the opportunity to make a statement if they so desire, and
will be available to respond to appropriate questions.
The Board of Directors recommends a vote "FOR" ratification
of the selection of Ernst & Young LLP as independent auditors of
the Company for fiscal year 1997.
<PAGE>
ITEM 3--STOCK OPTION PLAN FOR EMPLOYEES
INTRODUCTION
On May 14, 1996, the Board of Directors of the Company
approved and adopted the American Woodmark Corporation 1996
Stock Option Plan For Employees (the "Plan") subject to
shareholder approval.
The Plan became effective May 14, 1996. Unless sooner
terminated by the Board of Directors, the Plan will terminate on
May 13, 2006. Until the Plan is approved by shareholders, no
stock option may be exercised.
The purpose of the Plan is to further the long term
stability and financial success of the Company by attracting and
retaining key management employees and employees of the Company
and its subsidiaries and foreign affiliates who can contribute to
the financial success of those corporations through the use of
stock incentives. It is believed that ownership of Company
common stock will stimulate the efforts of those employees upon
whose judgment, interest and efforts the Company and its
subsidiaries and foreign affiliates is and will be largely
dependent for the successful conduct of their business. It is
also believed that awards granted to such employees under this
Plan will also further the identification of those employees'
interests with those of the Company's shareholders.
The principal features of the Plan are summarized below.
The summary is qualified by reference to the complete text of the
Plan, which is attached as Appendix A.
<PAGE>
GENERAL
The Plan authorizes the reservation of an aggregate of
750,000 authorized, but unissued, shares of Company common stock.
Shares allocable to Options granted under the Plan that expire or
otherwise terminate unexercised may again be subjected to an
incentive award under the Plan. For purposes of determining the
number of shares that are available for incentive awards under
the Plan, such number shall, if permissible under Rule 16b-3
promulgated under Section 16(b) of the Securities Exchange Act of
1934, include the number of shares surrendered by a Participant
or retained by the Company in payment of applicable withholding
taxes.
Adjustments will be made in the number of shares which may
be issued under the Plan in the event of a future stock dividend,
stock split or similar prorata change in the number of
outstanding shares of common stock or the future creation or
issuance to shareholders generally of rights, options or warrants
for the purchase of common stock or preferred stock.
The common stock is traded on NASDAQ and on May 14, 1996,
the closing price was $4.75.
ELIGIBILITY
All present and future employees of the Company and its
subsidiaries who hold positions with management responsibilities
are eligible to receive an option under the Plan. The Company
estimates that it has approximately thirty such employees (five
of whom are executive officers).
ADMINISTRATION
The Plan will be administered by a committee comprised of
directors of the Company who are not eligible to participate in
the Plan or any similar plan of the Company and who are outside
directors for purposes of section 162(m) of the Internal Revenue
Code (the "Code") as discussed below. It is anticipated that the
Committee will be the Compensation Committee. The Committee has
the power and complete discretion to determine when to grant
options, which eligible employees will receive options, and the
number of shares to be allocated to each option. The Committee
may impose conditions on the exercise of options and the sale or
transfer of shares acquired pursuant to the exercise of an option
as it may deem appropriate.
STOCK OPTIONS
Options to purchase shares of common stock granted under the
Plan may be only nonstatutory stock options. Nonstatutory stock
options do not qualify for favorable income tax treatment under
section 422 of the Internal Revenue Code. The purchase price of
common stock covered by a nonstatutory option may not be less
than 100% of Fair Market Value.
<PAGE>
Options may only be exercised at such times as may be
specified by the Committee in the option agreement. The
Committee may grant options with a provision that an option not
otherwise exercisable will become exercisable upon a "change of
control", a term defined in the Plan. In general, "change of
control" means the acquisition of 20% or more of the Company's
common stock or voting securities by a person or group and
certain changes in the membership of the Board of Directors.
If the option so provides, an optionee exercising an option
may pay the purchase price in cash; by delivering or causing to
be withheld from the option, shares of Company common stock; by
delivering a promissory note; or by delivering an exercise notice
together with irrevocable instructions to a broker to promptly
deliver to the Company the amount of sale or loan proceeds from
the option shares to pay the exercise price. The Committee may
also provide in the option that an employee who exercises an
option by delivering already owned shares of Company common stock
will be automatically granted a new replacement option equal in
amount to the number of shares delivered to exercise the option
with an exercise price equal to the fair market value of the
Company's common stock on the date of delivery and otherwise
having the same terms. The replacement option will not have a
replacement feature.
INITIAL AWARDS TABLE
Name and Position Dollar Value($) Number of Units
----------------- ---------- ---------
Jake Gosa, President & COO(1) $183,750(2) 35,000
(1) The Committee granted to the named executive on June 11,
1996 an option to purchase 35,000 shares of Company common
stock at a price of $5.25 per share. The named executive's
ability to exercise the option is conditioned upon the
shareholders' approval of the plan.
(2) The purchase price of the option is the fair market value of
Company common stock on the date on which the Committee
awarded the option, as determined under the terms of the
Plan. The Committee determined the fair market value of
Company common stock on June 11, 1996 to be $5.25 per share.
<PAGE>
COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162(M)
Code section 162(m) now imposes a $1,000,000 limitation on
the amount of the annual compensation deduction allowable to a
publicly held company with respect to each of its chief executive
officer and its other four most highly paid executive officers.
An exception is provided for performance-based compensation if
statutory provisions pertaining to stockholder approval (and
related disclosure) and outside director administrative
requirements are met. In order to qualify compensation
recognized upon the exercise of a nonstatutory stock option for
the performance-based exception under Code section 162(m), the
Plan limits the number of shares which can be made subject to the
grant of an option to an employee in any calendar year to 100,000
and requires that the Plan be administered by two or more
directors who are "outside directors" within the meaning of Code
section 162(m) and regulations thereunder.
TRANSFERABILITY OF INCENTIVE AWARDS
An option awarded under the Plan may not be sold,
transferred, pledged, or otherwise disposed of, other than by
will or by the laws of descent and distribution. All rights
granted to a participant under the Plan shall be exercisable
during his lifetime only by such participant, or his guardians or
legal representatives. Upon the death of a participant, his
personal representative or beneficiary may exercise his rights
under the Plan.
AMENDMENT OF THE PLAN AND AWARDS
The directors may amend the Plan in such respects as it
deems advisable; provided that, if and to the extent required by
Rule 16b-3 promulgated under section 16(b) of the Securities
Exchange Act of 1934, the shareholders of the Company must
approve any amendment that would (i) materially increase the
benefits accruing to participants under the Plan, (ii) materially
increase the number of shares of common stock that may be issued
under the Plan, or (iii) materially modify the requirements of
eligibility for participation in the Plan. Awards granted under
the Plan may be amended with the consent of the recipient so long
as the amended award is consistent with the terms of the Plan.
<PAGE>
FEDERAL INCOME TAX CONSEQUENCES
An employee granted a nonstatutory stock option will not
incur federal income tax.
Upon exercise of a nonstatutory stock option, an employee
generally will recognize compensation income, which is subject to
income tax withholding by the Company, equal to the difference
between the fair market value of the common Stock on the date of
the exercise and the option price. The Committee has authority
under the Plan to include provisions allowing the employee to
elect to have a portion of the shares he or she would otherwise
acquire upon exercise of an option withheld to cover withholding
tax liabilities. The election will be effective only if approved
by the Committee and made in compliance with other requirements
set forth in the Plan.
An employee may deliver shares of common stock instead of
cash to acquire shares under a nonstatutory stock option, without
having to recognize taxable gain.
Assuming the employee's compensation is otherwise reasonable
and that exceptions to the new statutory limitations on
compensation deductions by publicly held companies (as discussed
above) imposed by section 162(m) of the Code apply, the Company
usually will be entitled to a business expense deduction at the
time and in the amount that the employee recognizes ordinary
compensation income in connection therewith. As stated above,
this usually occurs upon exercise of nonstatutory options. The
Plan is intended to qualify for the Code section 162(m) exception
so that compensation income recognized upon the exercise of a
nonstatutory option will be performance based.
<PAGE>
This summary of Federal income tax consequences of
nonstatutory stock options, incentive stock options, restricted
stock and incentive stock does not purport to be complete. There
may also be state and local income taxes applicable to these
transactions.
VOTE REQUIRED
Approval of the 1996 Stock Option Plan requires the
affirmative vote of the holders of a majority of the shares of
common stock voting at the annual meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THE
1996 STOCK OPTION PLAN FOR EMPLOYEES PROPOSAL (ITEM 3 ON YOUR
PROXY CARD).
ITEM 4--SHAREHOLDER VALUE PLAN FOR EMPLOYEES
INTRODUCTION
On May 14, 1996, the Board of Directors of the Company (the
"Board") adopted the Shareholder Value Plan For Employees (the
"Plan") subject to approval by the Company's shareholders. The
Plan is intended to reward eligible employees with a cash payment
if the performance goals set forth in the Plan or set by the
Committee pursuant to the terms of the Plan are met.
The Plan is intended to meet the requirements of section
162(m) of the Internal Revenue Code, and regulations thereunder,
so that cash compensation received pursuant to the Plan will be
performance based compensation excludable from the $1 million
limitation on deductible compensation.
Under Section 162(m), publicly-held companies may be limited
as to income tax deductions for compensation paid to the extent
total remuneration paid to any of the chief executive officer or
the next four executive officers exceeds $1 million in any one
year unless the compensation is "performance-based" remuneration.
In general, Section 162(m) requires that before the beginning of
the year a compensation committee consisting solely of two or
more outside directors set objective performance standards which
must be met and establish the formula for computing the
performance-based amounts to be paid to each covered executive.
The material terms of the plan pursuant to which the remuneration
will be paid must be approved by a majority of the Company's
shareholders in order for the cash awards to qualify as
"performance-based" remuneration.
The Plan (attached as Appendix B) became effective May 1,
1996, subject to shareholder approval, and will be applicable to
fiscal years beginning in calendar 1996 and subsequent years
unless and until terminated by the Board of Directors.
<PAGE>
DESCRIPTION OF THE PLAN
Participants in the Plan are designated by the Committee.
The Committee has designated the Chairman (and CEO), and the next
four most highly compensated employees, as well as approximately
twenty other management employees, to participate in the Plan for
the initial three-year performance period beginning May 1, 1996
and ending April 30, 1999. Generally, a new three-year
performance period begins each May 1st.
The performance goal for the Plan is based on "total
shareholder return", defined in the plan as the increase in the
average trading price of a share of common stock value during the
month in which the performance period ends (the "ending price")
plus the value of distributions and dividends during the
performance period, over the average trading price of a share of
common stock during the month preceding the first day of the
three-year performance period (the "beginning price"), expressed
as an annualized rate of return for the performance period. The
total shareholder return for the Company common stock for the
performance period is compared to the total shareholder return of
the common stock for the publicly traded corporations that are
included in the S&P Home Furnishings and Appliance Index of
Companies (the "Index") for the same period.
With respect to each three-year performance period, the
Committee will designate and award participants with a number of
award units. The Committee will also fix at that time a range of
dollar values for the award unit related to the performance goal
percentile rank achieved for the three-year performance period.
For the three-year performance period beginning May 1, 1996, the
range of values for an award unit is between $500 at the 50th
percentile which is the threshold, and $3,000 at the 90+
percentile, which is the maximum value. For rankings between the
50th and 90th percentile, the award unit value is determined from
a table adopted by the Committee. For example, if a participant
has 50 award units and the Company's total shareholder return
equals the 50th percentile total shareholder return for the
Index, the participant will receive incentive compensation of
$25,000 (50 X $500) for the three-year performance period. If
the Company's percentile ranking is 91, the participant will
receive incentive compensation of $150,000 (50 X $3,000). If the
Company s percentile ranking is less than 50, no incentive
compensation will be paid.
In the event of a "change of control", a term defined in the
plan, any performance period which has not already ended will be
deemed to have ended on the last day of the month immediately
preceding the month in which the change of control occurs. The
Committee (or its successor) is required, within 90 days of the
change of control, to determine the amount of the awards payable
to participants pursuant to rules described above and to pay such
amounts to participants. In general, " change of control" means
the acquisition of 50% or more of the Company's common stock or
voting securities by a person or group and certain changes in the
membership of the Board of Directors.
<PAGE>
PAYMENT OF AWARDS
Before any award may be paid, the Committee must certify
that the performance goal has been achieved and any other
requirements of the Plan have been satisfied. No payment will be
made unless and until the Committee makes that certification.
Even though the performance goals have been met, the award
payable to a participant of any performance period shall not
exceed $750,000.
All awards will be paid as soon as administratively
practicable following the last day of the performance period to
which the award relates (except as described above in the case of
a change of control). A participant shall receive no award if
the participant's employment terminates before the last day of
the performance period for any reason other than death,
disability or retirement or the sale or other disposition of the
business unit in which the participant is employed. If
termination of employment occurs because of the occurrence of one
of the preceding events, a prorated award will be paid.
INITIAL AWARDS TABLE
The Committee does not intend to designate participants and
award units until after the Plan is approved by the Company's
shareholders.
ADMINISTRATION
The Plan will be administered by the Compensation Committee
of the Board, as long as the composition of the Committee
consists solely of two or more outside directors as that term is
defined in Code section 162(m). The Committee has the authority
to establish performance goals and award unit values under the
Plan.
AMENDMENT AND TERMINATION
The Board may amend or terminate the Plan at any time as it
deems appropriate; provided that (a) no amendment or termination
of the Plan after the end of a performance period may increase or
decrease the awards for the performance period just ended, and
(b) to the extent required to meet the requirements of Code
Section 162(m) for performance-based compensation, any amendment
that makes a material change to the Plan must be approved by the
shareholders of the Company. The Board is specifically
authorized to amend the Plan as necessary or appropriate to
comply with Code section 162(m) and regulations issued
thereunder.
<PAGE>
FEDERAL INCOME TAX CONSEQUENCES
A participant will not incur federal income tax until a cash
payment is made pursuant to the Plan. The income recognized will
be subject to income tax withholding by the Company.
The Company usually will be entitled to a business expense
deduction at the time and in the amount that the recipient of the
award recognizes ordinary compensation income in connection
therewith. The terms of each of the plans and the administration
thereof are intended to comply with Code section 162(m) (as
discussed above), that generally imposes a $1 million limitation
on the amount of the annual compensation deduction allowable to a
publicly-held company in respect of its chief executive officer
and its other four most highly paid officers, so that an award
paid in cash or incentive shares to a participant pursuant to
either of the plans will fall within the exception provided for
performance-based compensation. If for any reason the Plan or
the administration thereof is determined not to meet the
requirements of Code section 162(m), and regulations thereunder,
for any performance period, none or only a portion of the cash
awards for that year may be fully deductible.
VOTE REQUIRED
Approval of the Shareholder Value Plan For Employees
requires the affirmative vote of the holders of a majority of the
votes cast for or against the proposal at the annual meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THE
SHAREHOLDER VALUE PLAN FOR EMPLOYEES PROPOSAL (ITEM NO.4 ON YOUR
PROXY CARD).
OTHER BUSINESS
If any other business properly comes before the meeting,
your proxy may be voted by the persons named in it in such manner
as they deem proper.
At this time management does not know of any other business
which will be presented to the meeting.
PROPOSALS BY SHAREHOLDERS FOR PRESENTATION AT 1997 ANNUAL MEETING
Proposals which any shareholder intends to present to the
1997 Annual Meeting of Shareholders must be received by the
Company no later than March 15, 1997.
By Order of the Board of
Directors
Carol Lentz
Secretary
July 18, 1996
<PAGE>
APPENDIX A
AMERICAN WOODMARK CORPORATION
1996 STOCK OPTION PLAN FOR EMPLOYEES
AMERICAN WOODMARK CORPORATION (the "Company") hereby adopts
this American Woodmark Corporation 1996 Stock Option Plan.
1. PURPOSE
The purpose of the American Woodmark Corporation 1996 Stock
Option Plan (the "Plan") is to further the long term stability
and financial success of the Company by attracting and retaining
key management employees and employees of the Company and its
Subsidiaries who can contribute to the financial success of those
corporations through the use of stock incentives. It is believed
that ownership of Company Stock will further the identification
of those individuals' interests with those of the Company's
shareholders and stimulate the efforts of those employees upon
whose judgment, interest and efforts the Company and its
Subsidiaries is and will be largely dependent for the successful
conduct of their business.
The Plan has been adopted by the Board of Directors of the
Company subject to approval by the Company's shareholders.
2. DEFINITIONS
As used in the Plan, the following terms have the meanings
indicated:
a. "Act" means the Securities Exchange Act of 1934, as
amended.
b. "Applicable Withholding Taxes" means the aggregate amount
of federal, state and local income and payroll taxes that the
Company is required to withhold in connection with any exercise
of an Option.
c. "Award" means the award of a nonstatutory Option.
d. "Beneficiary" means the person or persons entitled to
receive a benefit pursuant to an Option upon the death of a
Participant.
e. "Board" means the Board of Directors of the Company.
f. "Change of Control" means:
i. The acquisition by any unrelated person of beneficial
ownership (as that term is used for purposes of the Act) of
50% or more of the then outstanding shares of common stock of
the Company or the combined voting power of the then
outstanding voting securities of the Company entitled to vote
generally in the election of directors. The term "unrelated
person" means any person other than (x) the Company and its
Subsidiaries, (y) an employee benefit plan or trust of the
Company or its Subsidiaries, and (z) a person who acquires
stock of the Company pursuant to an agreement with the
<PAGE>
Company that is approved by the Board in advance of the
acquisition, unless the acquisition results in a Change of
Control pursuant to subsection (ii) below. For purposes of
this subsection, a "person" means an individual, entity or
group, as that term is used for purposes of the Act.
ii. Any tender or exchange offer, merger or other business
combination, sale of assets or any combination of the
foregoing transactions, and the Company is not the surviving
corporation.
iii. A liquidation of the Company.
g. "Code" means the Internal Revenue Code of 1986, as
amended.
h. "Committee" means the committee appointed to administer
the Plan as provided in Section 13.
i. "Company" means American Woodmark Corporation.
j. "Company Stock" means common stock of the Company. In
the event of a change in the capital structure of the Company
(as provided in Section 12), the shares resulting from such a
change shall be deemed to be Company Stock within the meaning
of the Plan.
k. "Corporate Change" means a consolidation, merger,
dissolution or liquidation of the Company or a Subsidiary, or
a sale or distribution of assets or stock (other than in the
ordinary course of business) of the Company or a Subsidiary;
provided that, unless the Committee determines otherwise, a
Corporate Change shall only be considered to have occurred
with respect to Participants whose business unit is affected
by the Corporate Change.
l. "Date of Grant" means the date as of which an Option is
made by the Committee.
m. "Disability" or "Disabled" means the inability to perform
the job for which a Participant was employed because of a
physical or mental condition. The Committee shall determine
whether a Disability exists and such determination shall be
conclusive.
n. "Fair Market Value" means if the Company Stock is traded
on an exchange, the mean of the highest and lowest registered
sales prices of the Company Stock on that date on the
exchange on which the Company Stock generally has the
greatest trading volume, or if the Company Stock is traded
in the over-the-counter market, the mean between the high and
low prices on that date as reported on the NASDAQ National
Markets Transactions Tape. Fair Market Value shall be
determined as of the applicable date specified in the Plan
or, if there if are no trades on such date, the value shall
be determined as of the last preceding day on which the
Company Stock is traded.
<PAGE>
o. "Insider" means a person subject to Section 16(b) of the
Act.
p. "Nonstatutory Stock Option" means an Option that does not
meet the requirements of Code section 422, or that is
otherwise not intended to be an Incentive Stock Option and is
so designated.
q. "Option" means a right to purchase Company Stock granted
under the Plan, at a price determined in accordance with the
Plan.
r. "Parent" means, with respect to any corporation, a parent
of that corporation within the meaning of Code section
424(e).
s. "Participant" means any employee who receives an Option
under the Plan.
t. "Replacement Feature" means a feature of an Option, as
described in the Participant's stock option agreement, that
provides for the automatic grant of a Replacement Option in
accordance with the provisions of Section 7(b).
u. "Replacement Option" means an Option granted to a
Participant equal to the number of shares of already owned
Company Stock that are delivered by the Participant to
exercise an Option, as described in Section 7(b).
v. "Rule 16b-3" means Rule 16b-3 of the Act. A reference in
the Plan to Rule 16b-3 shall include a reference to any
corresponding subsequent rule or any amendments to Rule 16b-3
enacted after the effective date of the Plan.
w. "Subsidiary" means an entity of which the Company owns 50%
or more of the total combined voting power of all classes of
stock.
3. GENERAL
Only Nonstatutory Stock Options may be granted under the
Plan.
4. STOCK
Subject to Section 13 of the Plan, there shall be reserved
for issuance under the Plan an aggregate of 750,000 shares of
Company Stock, which shall be authorized, but unissued, shares.
Shares allocable to Options granted under the Company s 1986
Stock Option Plan or under this Plan that expire or otherwise
terminate unexercised may again be subjected to an Option under
this Plan. For purposes of determining the number of shares that
are available for Options under the Plan, such number shall, if
permissible under Rule 16b-3, include the number of shares
surrendered by a Participant or retained by the Company in
connection with the exercise of an option or in payment of
Applicable Withholding Taxes.
<PAGE>
5. ELIGIBILITY
a. Any employee of the Company or a Subsidiary who, in the
judgment of the Committee, has contributed or can be expected to
contribute to the profits or growth of the Company and directors
of the Company who are employees and are not members of the
Committee are eligible to receive Options under the Plan. The
Committee shall have the power and complete discretion, as
provided in Section 13, to select eligible employees to receive
Options and to determine for each employee the terms and
conditions applicable to the Option and the number of shares to
be allocated as part of the Option. The Committee is expressly
authorized to award an Option to a Participant conditioned upon
the surrender for cancellation of an existing Option.
b. The grant of an Option shall not obligate the Company or
any Subsidiary to pay an employee any particular amount of
remuneration, to continue the employment of the employee after
the grant or to make further grants to the employee at any time
thereafter.
6. STOCK OPTIONS
a. Whenever the Committee deems it appropriate to grant
Options, notice shall be given to the Participant stating the
number of shares for which Options are granted, the Option price
per share, and the conditions to which the grant and exercise of
the Options are subject. This notice, when duly accepted in
writing by the Participant, shall become a stock option agreement
between the Company and the Participant.
b. The Committee shall establish the exercise price of
Options. The exercise price of an Option shall be not less than
100% of the Fair Market Value of the shares of Company Stock
covered by the Option on the Date of Grant.
c. An employee may not receive awards of Options under the
Plan with respect to more than 100,000 shares of Company Stock
during any calendar year.
d. Options may be exercised in whole or in part at such times
as may be specified by the Committee in the Participant's stock
option agreement. The Committee may impose such vesting
conditions and other requirements as the Committee deems
appropriate, and the Committee may include such provisions
regarding a Change of Control or Corporate Change as the
Committee deems appropriate.
e. The Committee shall establish the term of each Option in
the Participant's stock option agreement. The term of the Option
shall not be longer than ten years from the Date of Grant. No
Option may be exercised after the expiration of its term or,
except as set forth in the Participant's stock option agreement,
after the termination of the Participant's employment. The
Committee shall set forth in the Participant's stock option
agreement when, and under what circumstances, an Option may be
exercised after termination of the Participant's employment or
period of service.
<PAGE>
f. If a Participant dies and if the Participant's stock
option agreement provides that part or all of the Option may be
exercised after the Participant's death, then such portion may be
exercised by the personal representative of the Participant's
estate during the time period specified in the stock option
agreement.
g. The Committee may, in its discretion, grant Options
containing a Replacement Feature as described in Section 7(b) and
may amend previously granted Nonstatutory Stock Options to
provide such a Replacement Feature.
7. METHOD OF EXERCISE OF OPTIONS
a. Options may be exercised by giving written notice of the
exercise to the Company, stating the number of shares the
Participant has elected to purchase under the Option. Such
notice shall be effective only if accompanied by the exercise
price in full in cash; provided that, if the terms of an Option
so permit, the Participant may deliver Company Stock that the
Participant has owned for at least six months (valued at Fair
Market Value on the date of exercise), or cause shares of Company
Stock (valued at their Fair Market Value on the date of exercise)
to be withheld in satisfaction of all or any part of the exercise
price, deliver a properly executed exercise notice together with
irrevocable instructions to a broker to deliver promptly to the
Company, from the sale or loan proceeds with respect to the sale
of Company Stock or a loan secured by Company Stock, the amount
necessary to pay the exercise price and, if required by the
Committee, Applicable Withholding Taxes, or deliver an interest
bearing promissory note, payable to the Company, in payment of
all or part of the exercise price, together with such collateral
and subject to such terms as may be required by the Committee at
the time of exercise. The interest rate under any such
promissory note shall be equal to the minimum interest rate
required at the time to avoid imputed interest to the Participant
under the Code.
b. If a Participant exercises an Option that has a
Replacement Feature by delivering already owned shares of Company
Stock, the Participant shall automatically be granted a
Replacement Option. The Replacement Option shall be subject to
the following provisions:
i. The Replacement Option shall cover the number of shares
of Company Stock delivered by the Participant to exercise the
Option;
ii. The Replacement Option will not have a Replacement
Feature;
iii. The exercise price of shares of Company Stock covered
by a Replacement Option shall be not less than 100% of the Fair
Market Value of such shares on the date the Participant delivers
shares of Company Stock to exercise the Option; and
<PAGE>
iv. The Replacement Option shall be subject to the same
restrictions on exercisability as those imposed on the underlying
Option and such other restrictions as the Committee deems
appropriate.
c. Notwithstanding anything herein to the contrary, Options
shall always be granted and exercised in such a manner as to
conform to the provisions of Rule 16b-3.
8. APPLICABLE WITHHOLDING TAXES
Each Participant shall agree, as a condition of receiving an
Option, to pay to the Company, or make arrangements satisfactory
to the Company regarding the payment of, all Applicable
Withholding Taxes with respect to the Option. Until the
Applicable Withholding Taxes have been paid or arrangements
satisfactory to the Company have been made, no stock certificates
shall be issued to the Participant. As an alternative to making
a cash payment to the Company to satisfy Applicable Withholding
Tax obligations, the Committee may establish procedures
permitting the Participant to elect (a) deliver shares of
already owned Company Stock or (b) have the Company retain that
number of shares of Company Stock that would satisfy all or a
specified portion of the Applicable Withholding Taxes. Any such
election shall be made only in accordance with procedures
established by the Committee and, in the case of an Insider, in
accordance with Rule 16b-3.
9. NONTRANSFERABILITY OF OPTIONS
a. In general Options, by their terms, shall not be
transferable by the Participant except by will or by the laws of
descent and distribution or except as described below. Options
shall be exercisable, during the Participant's lifetime, only by
the Participant or by his guardian or legal representative.
b. Notwithstanding the provisions of (a) and subject to
federal and state securities laws, the Committee may grant
Options that permit, or amend to permit, a Participant to
transfer the Options to one or more immediate family members, to
a trust for the benefit of immediate family members or to a
partnership whose only partners are immediate family members.
Consideration may not be paid for the transfer of Options. The
transferee of an Option shall be subject to all conditions
applicable to the Option prior to its transfer. The agreement
granting the Option shall set forth the transfer conditions and
restrictions. The Committee may impose on any transferable
Option and on stock issued upon the exercise of an Option such
limitations and conditions as the Committee deems appropriate.
Except to the extent otherwise permitted by Rule 16b-3, Options
that are intended to be exempt from Section 16(b) of the Act
pursuant to Rule 16b-3 may not be transferable except by will or
by the laws of descent and distribution.
<PAGE>
10. EFFECTIVE DATE OF THE PLAN
This Plan shall be effective May 14, 1996 subject to
approval by the Company's shareholders. Until the Plan has been
approved by the Company s shareholders and all applicable federal
and state securities laws have been complied with and the shares
of Company Stock have been listed on the stock exchange or
exchanges where traded, no Options shall be exercisable and no
Option shall be made that would result in the issuance of shares
of Company Stock.
11. TERMINATION, MODIFICATION, CHANGE
If not sooner terminated by the Board, this Plan shall
terminate at the close of business of May 13, 2006. No Options
shall be made under the Plan after its termination. The Board
may terminate the Plan or may amend the Plan in such respects as
it shall deem advisable; provided, that, if and to the extent
required by Rule 16b-3, no change shall be made that materially
increases the total number of shares of Company Stock reserved
for issuance pursuant to Options granted under the Plan (except
pursuant to Section 12), materially expands the class of persons
eligible to receive Options, or materially increases the benefits
accruing to Participants under the Plan, unless such change is
authorized by the shareholders of the Company. Notwithstanding
the foregoing, the Board may unilaterally amend the Plan and
Options as it deems appropriate to ensure compliance with Rule
16b-3 and to cause Incentive Stock Options to meet the
requirements of the Code and regulations thereunder. Except as
provided in the preceding sentence, a termination or amendment of
the Plan shall not, without the consent of the Participant,
adversely affect a Participant's rights under an Option
previously granted to him.
12. CHANGE IN CAPITIAL STRUCTURE
a. In the event of a stock dividend, stock split or
combination of shares, spin-off, reclassification, recapitaliza-
tion, merger or other change in the Company's capital stock
(including, but not limited to, the creation or issuance to
shareholders generally of rights, options or warrants for the
purchase of common stock or preferred stock of the Company), the
number and kind of shares of stock or securities of the Company
to be issued under the Plan (under outstanding Options and
Options to be granted in the future), the exercise price of
Options, and other relevant provisions shall be appropriately
adjusted by the Committee, whose determination shall be binding
on all persons. If the adjustment would produce fractional
shares with respect to any Option, the Committee may adjust
appropriately the number of shares covered by the Option so as to
eliminate the fractional shares.
<PAGE>
b. In the event the Company distributes to its
shareholders a dividend, or sells or causes to be sold to a
person other than the Company or a Subsidiary shares of stock in
any corporation (a "Spinoff Company") which, immediately before
the distribution or sale, was a majority owned Subsidiary of the
Company, the Committee shall have the power, in its sole
discretion, to make such adjustments as the Committee deems
appropriate. The Committee may make adjustments in the number
and kind of shares or other securities to be issued under the
Plan (under outstanding Options and Options to be granted in the
future), the exercise price of Options, and other relevant
provisions, and, without limiting the foregoing, may substitute
securities of a Spinoff Company for securities of the Company.
The Committee shall make such adjustments as it determines to be
appropriate, considering the economic effect of the distribution
or sale on the interests of the Company's shareholders and the
Participants in the businesses operated by the Spinoff Company.
The Committee's determination shall be binding on all persons.
If the adjustment would produce fractional shares with respect to
any Option, the Committee may adjust appropriately the number of
shares covered by the Option so as to eliminate the fractional
shares.
c. If a Change of Control or Corporate Change occurs, the
Committee may take such actions with respect to outstanding
Options as the Committee deems appropriate. These actions may
include, but shall not be limited to, accelerating the vesting
and payment of Options, releasing restrictions on Options, and
accelerating the expiration dates of Options. The effectiveness
of such acceleration or release of restrictions shall be
conditioned upon the consummation of the applicable Change of
Control or Corporate Change.
d. Notwithstanding anything in the Plan to the contrary,
the Committee may take the foregoing actions without the consent
of any Participant, and the Committee's determination shall be
conclusive and binding on all persons for all purposes. The
Committee shall make its determinations consistent with Rule
16b-3 and the applicable provisions of the Code.
13. ADMINISTRATION OF THE PLAN
a. The Plan shall be administered by a Committee
consisting of two or more outside directors of the Company, who
shall be appointed by the Board. The Board may designate the
Compensation Committee of the Board, or a subcommittee of the
Compensation Committee, to be the Committee for purposes of the
Plan. If and to the extent required by Rule 16b-3, all members
of the Committee shall be "disinterested persons" as that term is
defined in Rule 16b-3, and the Committee shall be comprised
solely of two or more "outside directors" as that term is defined
for purposes of Code section 162(m). If any member of the
Committee fails to qualify an "outside director" or (to the
extent required by Rule 16b-3) a "disinterested person," such
person shall immediately cease to be a member of the Committee
and shall not take part in future Committee deliberations. The
Committee from time to time may appoint members of the Committee
and may fill vacancies, however caused, in the Committee.
<PAGE>
b. The Committee shall have the authority to impose such
limitations or conditions upon an Option as the Committee deems
appropriate to achieve the objectives of the Option and the Plan.
Without limiting the foregoing and in addition to the powers set
forth elsewhere in the Plan, the Committee shall have the power
and complete discretion to determine (i) which eligible employees
shall receive an Option, (ii) the number of shares of Company
Stock to be covered by each Option, (iii) whether to include a
Replacement Feature in an Option and the conditions of any
Replacement Feature, (iv) the Fair Market Value of Company
Stock, (v)the time or times when an Option shall be granted,
(vi) whether an Option shall become vested over a period of time,
according to a performance-based vesting schedule or otherwise,
and when it shall be fully vested, (vii) the terms and
conditions under which restrictions imposed upon an Option shall
lapse, (viii) whether a Change of Control or Corporate Change
exists, (ix) when Options may be exercised, (x) whether to
approve a Participant's election with respect to Applicable
Withholding Taxes, (xi) conditions relating to the length of
time before disposition of Company Stock received in connection
with an Option is permitted, (xii) notice provisions relating to
the sale of Company Stock acquired under the Plan, and (xiii) any
additional requirements relating to Options that the Committee
deems appropriate.
c. The Committee shall have the power to amend the terms
of previously granted Options so long as the terms as amended are
consistent with the terms of the Plan. The consent of the
Participant must be obtained with respect to any amendment that
would adversely affect the Participant's rights under the Option,
except that such consent shall not be required if such amendment
is for the purpose of complying with Rule 16b-3 or any
requirement of the Code applicable to the Option.
d. The Committee may adopt rules and regulations for
carrying out the Plan. The Committee shall have the express
discretionary authority to construe and interpret the Plan and
the Option agreements, to resolve any ambiguities, to define any
terms, and to make any other determinations required by the Plan
or an Option agreement. The interpretation and construction of
any provisions of the Plan or an Option agreement by the
Committee shall be final and conclusive. The Committee may
consult with counsel, who may be counsel to the Company, and
shall not incur any liability for any action taken in good faith
in reliance upon the advice of counsel.
e. A majority of the members of the Committee shall
constitute a quorum, and all actions of the Committee shall be
taken by a majority of the members present. Any action may be
taken by a written instrument signed by all of the members, and
any action so taken shall be fully effective as if it had been
taken at a meeting.
<PAGE>
14. ISSUANCE OF COMPANY STOCK
The Company shall not be required to issue or deliver any
certificate for shares of Company Stock before (i) the admission
of such shares to listing on any stock exchange on which the
Company Stock may then be listed, (ii) receipt of any required
registration or other qualification of such shares under any
state or federal law or regulation that the Company's counsel
shall determine is necessary or advisable, and (iii) the Company
shall have been advised by counsel that all applicable legal
requirements have been complied with. The Company may place on a
certificate representing Company Stock any legend required to
reflect restrictions pursuant to the Plan, and any legend deemed
necessary by the Company's counsel to comply with federal or
state securities laws. The Company may require a customary
written indication of a Participant's investment intent. Until a
Participant has been issued a certificate for the shares of
Company Stock acquired, the Participant shall possess no
shareholder rights with respect to the shares.
15. RIGHTS UNDER THE PLAN
Title to and beneficial ownership of all benefits described
in the Plan shall at all times remain with the Company.
Participation in the Plan and the right to receive payments under
the Plan shall not give a Participant any proprietary interest in
the Company or any Subsidiary or any of their assets. No trust
fund shall be created in connection with the Plan, and there
shall be no required funding of amounts that may become payable
under the Plan. A Participant shall, for all purposes, be a
general creditor of the Company. The interest of a Participant
in the Plan cannot be assigned, anticipated, sold, encumbered or
pledged and shall not be subject to the claims of his creditors.
16. BENEFICIARY
A Participant may designate, on a form provided by the
Committee, one or more beneficiaries to receive any payments
under Options of Restricted Stock or Incentive Stock after the
Participant's death. If a Participant makes no valid
designation, or if the designated beneficiary fails to survive
the Participant or otherwise fails to receive the benefits, the
Participant's beneficiary shall be the first of the following
persons who survives the Participant: (a)the Participant's
surviving spouse, (b) the Participant's surviving descendants,
per stirpes, or (c) the personal representative of the
Participant's estate.
17. NOTICE
All notices and other communications required or permitted
to be given under this Plan shall be in writing and shall be
deemed to have been duly given if delivered personally or mailed
first class, postage prepaid, as follows (a) if to the Company -
at its principal business address to the attention of the
Secretary; (b) if to any Participant - at the last address of the
Participant known to the sender at the time the notice or other
communication is sent.
<PAGE>
18. INTERPRETATION
The terms of this Plan and Options granted pursuant to the
Plan are subject to all present and future regulations and
rulings of the Secretary of the Treasury or his delegate relating
to the qualification of Incentive Stock Options under the Code or
compliance with Code section 162(m), to the extent applicable,
and they are subject to all present and future rulings of the
Securities Exchange Commission with respect to Rule 16b-3. If
any provision of the Plan or an Option conflicts with any such
regulation or ruling, to the extent applicable, the Committee
shall cause the Plan to be amended, and shall modify the Option,
so as to comply, or if for any reason amendments cannot be made,
that provision of the Plan and/or the Option shall be void and of
no effect.
<PAGE>
APPENDIX B
AMERICAN WOODMARK CORPORATION
SHAREHOLDER VALUE PLAN FOR EMPLOYEES
1. PURPOSE
On May 14, 1996, the Board of Directors of the Company
adopted the Shareholder Value Plan For Employees (the "Plan") to
provide incentive-based cash benefits for eligible participants
if the performance goals fixed by the Committee pursuant to the
terms of the Plan are met. The Plan is subject to approval by
Company shareholders and is intended to meet the requirements of
section 162(m) of the Internal Revenue Code, and regulations
thereunder, so that cash compensation received pursuant to the
Plan will be incentive compensation excludable from the $1
million limitation on deductible compensation.
2. DEFINITIONS
As used in the Plan, the following terms have the meanings
indicated:
(a) "Award Table" means a table similar in type to Exhibit
A with changes necessary to adapt the table to the performance
criteria selected by the Committee for the Performance Period and
to display other objective factors necessary to determine the
amount, if any, of the award for the Performance Year.
(b) "Award Unit" means a measure of value fixed by the
Committee with respect to each Performance Period whose value
will be based upon the extent to which the Performance Goal set
by the Committee for the Performance Period has been achieved.
(c) "Board" means the board of directors of the Company.
(d) "Change" of Control means:
(i) The acquisition by any unrelated person of
beneficial ownership (as that term is used for purposes
of the Securities Exchange Act of 1934) of 50% or more of
the then outstanding shares of common stock of the
Company or the combined voting power of the then
outstanding voting securities of the Company entitled to
vote generally in the election of directors. The term
unrelated person means any person other than (x) the
Company and its Subsidiaries, (y) an employee benefit
plan or trust of the Company or its Subsidiaries, and (z)
a person who acquires stock of the Company pursuant to an
agreement with the Company that is approved by the Board
in advance of the acquisition, unless the acquisition
results in a Change of Control pursuant to subsection
(ii) below. For purposes of this subsection, a person
means an individual, entity or group, as that term is
used for purposes of the Act.
(ii) Any tender or exchange offer, merger or other
business combination, sale of assets or any combination
of the foregoing transactions, and the Company is not the
surviving corporation.
<PAGE>
(iii) A liquidation of the Company.
(e) "Code" means the Internal Revenue Code of 1986, as
amended, and regulations thereunder.
(f) "Committee" means the committee appointed by the
Board as described in Section 6.
(g) "Company" means American Woodmark Corporation, a
Virginia corporation.
(h) "Company Stock" means the common stock of the Company.
(i) "Comparison Group" means the publicly traded
corporations that are included in the S&P Home Furnishings and
Appliance Index of companies.
(j) "Disability" means a condition that entitles the
Participant to disability payments under the terms of the
Company's long term disability plan.
(k) "Fair Market Value" means, on any given date, the
average of the high and low price on such date as reported on the
NASDAQ National Markets Transactions Tape. In the absence of any
such sale, fair market value means the average of the closing bid
and asked prices of a share of Common Stock on such date as
reported by such source. In the absence of such average or if
shares of Common Stock are no longer traded on NASDAQ, the fair
market value shall be determined by the Committee using any
reasonable method in good faith.
(l) "Participant" means any person eligible to receive a
cash award under the Plan.
(m) "Performance Goal" means for the three-year
Performance Period beginning May 1, 1996 the amount of Total
Shareholder Return computed for a share of American Woodmark
Corporation common stock specified by the Committee that when
expressed as a percentage and compared with the Comparison Group
falls within the ranking scale between the 50th percentile and
including the 90th percentile for such Performance Period. For
Performance Periods beginning after April 30, 1997, the term
generally means Total Shareholder Return as described in the
preceding sentence with such adjustments to percentages in the
ranking scale as the Committee deems appropriate for the
Performance Period.
(n) "Performance Period" means three consecutive
Performance Years.
(o) "Performance Year" means the period which is also the
Company's fiscal year.
(p) "Plan" means the American Woodmark Corporation
Shareholder Value Plan For Employees.
<PAGE>
(q) "Retirement" or "Retires" means the termination of
employment of a Participant on or after the Participant's Early
Retirement Date under the Company's Pension Plan for reasons
other than death.
(r) "Total Shareholder Return" means for each Performance
Period (1) the increase in the average trading price of a share
of common stock during the month in which ends the Performance
Period (the ending price) over the average trading price of a
share of common stock during the month preceding the first day of
the Performance Period (the beginning price), plus (2) the value
of dividends or other distributions with respect to a share of
common stock during the Performance Period, expressed as an
annualized rate of return for the Performance Period.
3. PARTICIPATION
Management employees designated by the Committee shall be
eligible to participate in the Plan. The Committee shall award
to each Participant with respect to each Performance Period the
number of Award Units which shall be a component in measuring the
value of the Participant's incentive payment.
4. DETERMINATION OF AWARDS
(a) Before the beginning of each Performance Period,
except as provided in (d) below, the Committee will complete and
adopt an Award Table substantially in the form attached as
Exhibit A. The Award Table will fix the Performance Period, the
Performance Goal and all other relevant objective components for
determining whether an incentive payment will be due and, if so,
the amount of the incentive payment. Incentive payments are
based on the value of each Award Unit for the Performance Period
if and to the extent the Performance Goal is achieved. The
Performance Goal shall be the attainment of a target percentage
or range of target percentages of the Performance Goal for the
Performance Period. The amount payable to a Participant for the
Performance Period will be determined from the Award Table as the
product of the number of Award Units assigned to the Participant
multiplied by the value of each Award Unit as of the end of the
Performance Period. The Committee may establish such threshold
requirements for the payment of an award and limitations on the
amount of the award as the Committee shall deem appropriate.
Once fixed, the Performance Period, the Performance Goals and
targets for a Performance Period may not be modified after the
Performance Period begins.
(b) Before any award may be paid for a Performance
Period, the Committee shall certify that the Performance Goals
and any other requirements of the Plan have been satisfied for
the Performance Period. No payments shall be made unless and
until the Committee makes this certification. Once the payment
has been made pursuant to the certification, such certification
and payment shall not be subject to change because of the
occurrence of subsequent events or discovery of facts not known
or not reasonably foreseeable at the time the certification is
made.
<PAGE>
(c) Even though the Performance Goals have been met, no
award to a Participant with respect to a Performance Period shall
exceed $750,000.
(d) In the Performance Year in which the Plan is adopted,
the Committee may take the action required under (a) at any time
during the initial Performance Year.
5. PAYMENT OF AWARDS
(a) If the Committee has made the certification required
pursuant to Section 4(b), subject to Section 4(c), awards shall
be paid as soon as administratively practicable following the
last day of the Performance Period for which they are computed.
All awards under the Plan are subject to federal, state and local
income and payroll tax withholding when paid.
(b) A Participant shall not receive an award if the
Participant's employment with the Company and its subsidiaries
terminates prior to the last day of the Performance Period for
any reason other than death, Disability, Retirement, or sale or
other disposition of the business unit in which the Participant
was employed. A Participant who terminates employment for one of
the reasons described in the preceding sentence shall be eligible
to receive a prorata award, if an award is otherwise payable
pursuant to Section 4, based on the ratio that the number of full
months elapsed during the Performance Period to the date the
event occurred bears to 36 or such greater number of months in
the Performance Period. A Participant shall not forfeit an award
if the Participant's employment terminates after the end of the
applicable Performance Period, but prior to the distribution of
the award, if any, for such year.
(c) If a Participant dies and is subsequently entitled to
receive an award under the Plan, the award shall be paid to the
personal representative of the Participant's estate.
6. ADMINISTRATION
(a) The Plan shall be administered by the Compensation
Committee of the Board of Directors (the "Committee"), which
shall be comprised solely of two or more "outside directors", as
that term is defined for purposes of Code Section 162(m).
(b) The Board from time to time may appoint members
previously appointed and may fill vacancies, however caused, in
the Committee. Insofar as it is necessary to satisfy the
requirements of Section 16(b) of the Securities Exchange Act of
1934, no member of the Committee shall be eligible to participate
in the Plan.
(c) If any member of the Committee fails to qualify as an
"outside director" or otherwise meet the requirements of this
section, such person shall immediately cease to be a member of
the Committee solely for purposes of the Plan and shall not take
part in future Committee deliberations.
<PAGE>
(d) The Committee may adopt rules and regulations for
carrying out the Plan, and the Committee may take such actions as
it deems appropriate to ensure that the Plan is administered in
the best interests of the Company. The Committee has the
authority to construe and interpret the Plan, resolve any
ambiguities, and make determinations with respect to the
eligibility for or amount of any award. The interpretation,
construction and administration of the Plan by the Committee
shall be final and conclusive. The Committee may consult with
counsel, who may be counsel to the Company, and shall not incur
any liability for any action taken in good faith in reliance upon
the advice of counsel.
7. RIGHTS
Participation in the Plan and the right to receive cash
awards under the Plan shall not give a Participant any
proprietary interest in the Company, any subsidiary or any of
their assets. No trust fund shall be created in connection with
the Plan, and there shall be no required funding of amounts that
may become payable under the Plan. A Participant shall for all
purposes be a general creditor of the Company. The interests of
a Participant cannot be assigned, anticipated, sold, encumbered
or pledged and shall not be subject to the claims of his
creditors. Nothing in the Plan shall confer upon any Participant
the right to continue in the employ of the Company or any
subsidiary or shall interfere with or restrict in any way the
right of the Company and its subsidiaries to discharge a
Participant at any time for any reason whatsoever, with or
without cause.
8. SUCCESSORS
The Plan shall be binding on the Participants and their
personal representatives. If the Company becomes a party to any
merger, consolidation, reorganization or other corporate
transaction, the Plan shall remain in full force and effect as an
obligation of the Company or its successor in interest. In the
event of a Change of Control, each Performance Period which has
not ended prior to the date of the Change of Control shall be
deemed to have ended on the last day of the month immediately
preceding the month in which the Change of Control occurred. The
Committee, or any successor thereto, shall determine the awards
payable to Participants pursuant to Section 4 for such
Performance Periods. Within no later than 90 days following the
date of the Change of Control, the Committee (or its successor)
shall determine whether the Performance Goals for such
Performance Periods have been satisfied and shall pay the
appropriate awards to Participants.
<PAGE>
9. AMENDMENT AND TERMINATION
The Board may amend or terminate the Plan at any time as it
deems appropriate; provided that i. no amendment or termination
of the Plan after the end of a Performance Period may increase or
decrease the awards for the Performance Period just ended, and
ii. to the extent required to meet the requirements of Code
Section 162(m) for performance-based compensation, any amendment
that makes a material change to the Plan must be approved by the
shareholders of the Company. The Board is specifically
authorized to amend the Plan and take such other actions as
necessary or appropriate to comply with Code Section 162(m) and
regulations issued thereunder, and to comply with or avoid
administration of the Plan in a manner that could cause a
Participant to incur liability under Section 16(b) of the
Securities Exchange Act of 1934 and regulations issued
thereunder.
10. INTERPRETATION
If any provision of the Plan would cause the Plan to fail to
meet the Code Section 162(m) requirements for performance-based
compensation, then that provision of the Plan shall be void and
of no effect. The Plan shall be interpreted according to the
laws of the Commonwealth of Virginia.
<PAGE>
EXHIBIT A
AWARD TABLE
PERFORMANCE PERIOD BEGINNING 5/1/96 AND ENDING 4/30/99
BASIS FOR PERFORMANCE GOAL MEASUREMENT: TOTAL SHAREHOLDER RETURN
PERCENTILE RANK
S&P Home Furnishings
and Appliance Index AWARD UNIT VALUE*
--------- ----------
THRESHOLD 50 $ 500
55 700
TARGET 60 1,000
65 1,300
70 1,600
75 1,950
80 2,300
85 2,650
MAXIMUM 90+ 3,000
* Award Unit Values for percentile rank performance between
those listed in the tables will be interpolated.
AWARD DERIVATIONS
Before the beginning of each Performance Year, the Committee will
complete and evidence in writing the following process relative
to Plan administration for the Performance Year.
1. Specify the Performance Period beginning and ending dates.
2. Specify any additions or changes in participation and assign
Award Units to Participants.
3. Specify the comparison group for determining the Company's
percentile rank for the purpose of determining whether a
cash award will be payable under the Plan for the
Performance Year.
4. Fix Award Unit values in relation to Performance Goal and
target levels.
5. Fix Threshold Performance Goal rank below which no award is
payable.
6. Fix percent of Target Award rank.
7. Fix maximum Performance Goal rank which results in maximum
permitted award.
<PAGE>
[DESCRIPTION] PROXY CARD
AMERICAN WOODMARK CORPORATION
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD AUGUST 20, 1996
The undersigned hereby appoints Richard A. Graber and Donald P. Mathias
(each with power to act alone and with power of substitution) as proxies, and
hereby authorizes them to represent and vote, as directed on the reverse side,
all the shares of Common Stock of American Woodmark Corporation held of record
by the undersigned on June 28, 1996, at the annual meeting of shareholders to
be held on August 20, 1996, and any adjournment thereof.
This proxy when properly executed will be voted in the manner directed
herein by the undersigned shareholder. If no direction is made, this proxy
will be voted FOR proposals 1 and 2.
(Continued and to be signed on the other side)
<PAGE>
Please mark your votes as indicated in this example: X
---
1. ELECTION OF DIRECTORS
NOMINEES: William F. Brandt, Jr.,
FOR all nominees WITHHOLD Donald P. Mathias, C. Anthony
listed to the AUTHORITY Wainwright, Martha M. Dally, James
right (except as to vote for J. Gosa, Richard A. Graber, John T.
indicated hereon) all nominees Gerlach, Daniel T. Carroll
listed to the
right
--- ---
(INSTRUCTION: To withhold authority to vote for any individual nominee write
that nominee's name on the line provided below.)
- -----------------------------------------------------------------------------
2. PROPOSALS TO RATIFY THE SELECTION OF ERNST & YOUNG LLP as
independent certified public accountants of the Company.
FOR AGAINST ABSTAIN
--- --- ---
3. To consider and vote upon a proposal to approve a Stock Option Plan
for employees.
FOR AGAINST ABSTAIN
--- --- ---
4. To consider and vote upon a proposal to approve a Shareholder Value
Plan for employees,
FOR AGAINST ABSTAIN
--- --- ---
and,
5. In their discretion the proxies are authorized to vote upon such
other business as may properly come before the meeting.
Date , 1996
-----------------------------------
Signature
-------------------------------------
Signature
-------------------------------------
Please sign exactly as name appears to the left. Executors,
trustees, etc., should so indicate when signing. If a corporation,
sign in full corporate name by authorized officer. If a partnership,
sign in partnership name by authorized person.
Please date, sign and return this Proxy in the enclosed envelope.
<PAGE>
