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 ("Annual Meeting") of
American Woodmark Corporation (the "Company") will be held at
Piper's at Creekside, Route 11 South, Winchester, Virginia, on
Wednesday, August 27, 1997 at 9:00 a.m., Eastern Daylight Time,
for the following purposes:
1. To elect six 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, 1998; and
3. To transact such other business as may properly come before
the Annual Meeting or any adjournments thereof.
Only shareholders of record of shares of the Company's
Common Stock at the close of business on July 1, 1997 will be
entitled to vote at the Annual Meeting or any adjournments
thereof.
Regardless of whether or not you plan to attend the Annual
Meeting, please complete the enclosed proxy, including signature
and date, and promptly return in the enclosed envelope. If for
any reason you desire to revoke your proxy, you may do so at
anytime before it is voted.
All shareholders are cordially invited to attend the Annual
Meeting.
By Order of the Board of Directors
CAROL LENTZ
SECRETARY
July 24, 1997
<PAGE>
AMERICAN WOODMARK CORPORATION
3102 SHAWNEE DRIVE
WINCHESTER, VIRGINIA 22601
PROXY STATEMENT
VOTING RIGHTS AND SOLICITATION
This Proxy Statement, mailed to shareholders on or about July
24, 1997, 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 27, 1997, and at any adjournments thereof.
A copy of the annual report of the Company for the fiscal year
ended April 30, 1997 is being mailed to you with this Proxy
Statement.
In addition to the solicitation of proxies by mail, the
Company's officers and other employees, without compensation, may
solicit proxies by telephone, telegraph and personal interview.
The Company will bear the cost of all solicitation.
On July 1, 1997, the date for determining the shareholders
entitled to vote at the Annual Meeting, there were 7,737,089
shares of Common Stock of the Company outstanding and entitled to
vote. Each such share of Common Stock entitles the holder
thereof to one vote.
Any shareholder who provides a proxy may revoke such proxy at
any time before it is voted. Proxies may be revoked by filing
with the Secretary of the Company written notice of revocation
which bears a later date than the date of the proxy, by duly
executing and filing with the Secretary of the Company a later
dated proxy relating to the same shares or by attending the
Annual Meeting and voting in person.
A proxy, if executed and not revoked, will be voted for the
election of the nominees for director named herein and for the
ratification of Ernst & Young LLP as independent certified public
accountants of the Company for fiscal year 1998 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
A Board of six directors of the Company is to be elected at
the Annual Meeting to serve as directors until the next Annual
Meeting of Shareholders and until their successors have been
elected. Other than Mr. Grunewald, each of the nominees listed
below is presently a director of the Company, and each was
elected by shareholders at the last Annual Meeting for a term
expiring at the 1997 Annual Meeting. Other nominations may be
made from the floor at the Annual Meeting.
<PAGE>
Although the Company anticipates that all of the nominees
named below will be able to serve, if at the time of the Annual
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.
NOMINEES
Principle Occupation(s) Director
During of
Name Age the Last Five Years and Company
Directorship(s) in Public Since
Companies
- ------------------ --- ----------------------------- --------
William F. Brandt, 51 Company Chairman from 1996 to 1980
Jr. present; Company Chairman and
Chief Executive Officer from
1995 to 1996; Company
Chairman and President from
1980 to 1995
Daniel T. Carroll 71 Chairman from 1995 to present 1986
and Chairman and President
from 1982 to 1995 of the
Carroll Group, Inc. (a
management consulting firm);
Director, Aon Corporation,
A.M. Castle & Co., Comshare,
Inc., Diebold, Inc.,
Wolverine World Wide, Inc.,
Woodhead Industries, Inc.,
Holmes Protection,
Recombinant Biocatalyst, Inc.
and Oshkosh Truck Corp.
C. Anthony 63 Vice Chairman from 1997 to 1987
Wainwright present of McKinney & Silver
(an advertising agency);
Chairman from 1995 to 1997 of
Harris, Drury, Cohen, Inc.
(an advertising agency);
Chairman in 1994 and Vice
Chairman and CEO from 1990 to
1994 of Compton/Saatchi &
Saatchi, Inc. (an advertising
agency); Director, Gibson
Greeting Inc., Del Webb
Corp., All-Comm Media,
Advanced Polymer Systems, and
Caribiner International
<PAGE>
James J. Gosa 50 Company President and Chief 1995
Executive Officer from 1996
to present; Company President
and Chief Operating Officer
from 1995 to 1996; Company
Executive Vice President from
1993 to 1995; Company Vice
President, Sales and
Marketing from 1991 to 1993
Martha M. Dally 46 Executive Vice President, 1995
Personal Products from 1994
to present of Sara Lee
Corporation; Vice President,
Personal Products from 1989
to 1993 of Sara Lee
Corporation
Fred S. Grunewald 46 President and Chief Operating *
Officer from 1996 to present
of Overhead Door Corporation
(a manufacturing company);
President and General
Manager, Home Products from
1994 to 1995 of Rubbermaid,
Inc.; Vice President,
Marketing and Engineering,
Household Products Division
from 1992 to 1994 of Black &
Decker; Vice President,
General Manager, Global
Cordless Group from 1990 to
1992 of Black & Decker
(*) Mr. Grunewald has not previously served on the Board of
Directors of the Company.
PRINCIPAL SHAREHOLDERS OF THE COMPANY
The following table sets forth information regarding shares
of Common Stock beneficially owned as of July 1, 1997 by (i)
each person who is known by the Company to beneficially own
more than five percent 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 five
percent of the outstanding shares of Common Stock are: Mr.
William F. Brandt, Jr., 3102 Shawnee Drive, Winchester,
Virginia 22601; Mr. Donald P. Mathias, 5240 62nd Ave. South,
St. Petersburg, Florida 33715; Ms. Mary Jo Stout, PO Box 206,
Cross Junction, Virginia 22625; and Mr. Richard A. Graber, 1712
Handley Ave., Winchester, Virginia 22601.
<PAGE>
Number of Aggre-
Shares gate
Beneficially Percent
Name Owned of Class
-------------------------------- ------------- --------
William F. Brandt, Jr. (1)...... 2,307,845 29.8
Mary Jo Stout (2)............... 889,036 11.5
Richard A. Graber (3)........... 613,687 7.9
Donald P. Mathias (4)........... 518,939 6.7
David L. Blount (5)............. 167,086 2.2
James J. Gosa (6)............... 42,212 *
Kent B. Guichard (7)............ 17,325 *
Daniel T. Carroll (8)........... 9,700 *
John T. Gerlach (9)............. 8,700 *
C. Anthony Wainwright (10)...... 3,584 *
Martha M. Dally (11)............ 1,000 *
Fred S. Grunewald .............. 0 *
All directors and executive.....
officers as a group (9 persons). 2,557,452 32.8
*Indicates less than 1%.
(1) Includes 193,600 shares held by Mr. Brandt as trustee
for the benefit of his children, 24,794 shares by the Brandt
Family Foundation, and stock options exercisable on July 1,
1997 or within 60 days thereafter by Mr. Brandt for 8,333
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 9,725 shares by
the Holcomb Family Foundation.
(3) Includes 166,496 shares held by Mr. Graber as trustee
for the benefit of his children, and 11,972 shares by the
Graber Family Foundation.
(4) Includes 221,244 shares held by Mr. Mathias as trustee
for the benefit of his children, and 295,904 held in revocable
trusts for the benefit of Mr. Mathias and his spouse.
(5) Includes 12,923 shares held by the Windcrest
Foundation, Inc. and stock options exercisable on July 1, 1997
or within 60 days thereafter by Mr. Blount for 12,500 shares.
(6) Includes stock options exercisable on July 1, 1997 or
within 60 days thereafter by Mr. Gosa for 16,667 shares.
(7) Includes stock options exercisable on July 1, 1997 or
within 60 days thereafter by Mr. Guichard for 8,334 shares.
(8) Includes stock options exercisable on July 1, 1997 or
within 60 days thereafter by Mr. Carroll for 2,000 shares.
(9) Includes stock options exercisable on July 1, 1997 or
within 60 days thereafter by Mr. Gerlach for 1,000 shares.
(10)Includes stock options exercisable on July 1, 1997 or
within 60 days thereafter by Mr. Wainwright for 2,000 shares.
(11)Includes stock options exercisable on July 1, 1997 or
within 60 days thereafter by Ms. Dally for 1,000 shares.
<PAGE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934
requires the Company's directors and officers, and persons who
beneficially own more than ten percent of a registered class of
the Company's equity securities (including Common Stock), to
file with the Securities and Exchange Commission ("SEC")
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
beneficial owners are required by SEC rules to furnish the
Company with copies of all Section 16(a) reports they file with
the SEC.
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 to be filed
during the fiscal year ended April 30, 1997, all Section 16(a)
filing requirements applicable to the Company's officers,
directors, and greater than ten percent beneficial owners were
complied with; except that one Form 4 report for one
transaction was filed late by Mr. Richard A. Graber, one of the
Company's directors during the 1997 fiscal year.
CERTAIN INFORMATION CONCERNING THE
BOARD OF DIRECTORS AND ITS COMMITTEES
The Board of Directors held seven regular meetings during
the fiscal year ended April 30, 1997. Messrs. Brandt, Carroll
and Gosa each attended all seven meetings. Mr. Wainwright and
Ms. Dally each attended six of the seven meetings. Mr. Gerlach
attended four of the seven meetings. Mr. Graber resigned from
the Board of Directors on January 31, 1997. Mr. Graber attended
all Board meetings conducted prior to his resignation. Mr.
Mathias resigned from the Board of Directors on March 17, 1997.
Mr. Mathias attended all Board meetings conducted prior to his
resignation.
BOARD AND COMMITTEE MEETINGS
The Board of Directors has a Compensation Committee, an
Audit Committee and a Governance Committee. The Compensation
Committee is composed of Mr. Gerlach, Mr. Wainwright and Ms.
Dally. Mr. Gerlach served as Chairperson of the Compensation
Committee until February 17, 1997, at which time Ms. Dally became
Chairperson. The Compensation Committee determines awards under
and administers the Company's 1996 Stock Option Plan for
Employees and the Company's Shareholder Value Plan. The
Committee also reviews the compensation of executive officers of
the Company. The Compensation Committee met seven times during
fiscal year 1997. Each committee member, with the exception of
Mr. Gerlach, attended all seven meetings. Mr. Gerlach attended
four of the seven meetings.
<PAGE>
At the start of the fiscal year, the Audit Committee
consisted of Mr. Carroll, Mr. Gerlach and Mr. Graber. Mr.
Mathias replaced Mr. Graber as an Audit Committee member at the
February 17, 1997 meeting, following Mr. Graber's resignation
from the Board of Directors. Mr. Carroll serves as the
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 both internal and
independent audit procedures, the nature of services to be
performed by the independent auditors and the Company's
accounting practices. The Audit Committee met three times in
fiscal year 1997. Mr. Carroll attended all three of the
Committee meetings, Mr. Gerlach attended two of the three
meetings, Mr. Graber attended both meetings conducted prior to
his resignation and Mr. Mathias attended the one meeting held
during his participation on the Audit Committee.
The Governance Committee is composed of Mr. Brandt, Mr.
Wainwright and Mr. Carroll. Mr. Brandt serves as Chairperson of
the Governance Committee. The Governance Committee is
responsible for the recruitment and nomination of new directors,
appoints committees and chairs, reviews the performance of each
director a minimum of once every three years, reviews the
performance of the Board and explores ways to improve the
effectiveness of the Board. The Governance Committee met four
times during fiscal year 1997. All Committee members attended
each meeting.
The Board of Directors approved the establishment of a
charitable foundation for the Company during fiscal year 1995.
Mr. Graber was appointed to serve as Chairperson of the Board of
Directors for the Charitable Foundation and as such was
compensated for attendance on a basis consistent with the
compensation for meeting attendance for the Audit, Compensation
and Governance Committees of the Board as described below. The
charitable foundation met four times during fiscal year 1997.
Mr. Graber attended all three meetings conducted prior to his
resignation from the Board of Directors.
COMPENSATION OF THE BOARD
Non-management directors receive an annual retainer 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 employees of the
Company do not receive any compensation for their membership on
the Board.
<PAGE>
The 1995 Non-Management Director Retirement Plan provides
each non-employee director with a credit equal to fifty percent
of the current annual retainer on the first day of each fiscal
year. Each non-employee director may receive a maximum of ten
annual credits. Each non-employee director becomes vested in his
or her total credits received at a rate of ten percent per year,
and is fully vested in all credits after completing ten years of
service on the Board. Total vested credits will be paid to
directors on the first day of each fiscal year commencing with
the year immediately following the director's retirement from the
Board. Payments will be made in equal amounts over the same
number of years that the director served on the Board, but in no
event over more than ten years. For 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 Company's 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. The 1995 Directors Plan
provides for an automatic award to each non-employee director
upon his or her initial election to the Board of an option to
acquire 1,000 shares of Common Stock. Each year thereafter,
eligible Directors are automatically granted an option to acquire
an additional 1,000 shares of Common Stock. The exercise price
for each option granted under the 1995 Directors Plan is 100% of
the fair market value of Common Stock on the date of the grant.
Options granted under the 1995 Directors Plan have a term of four
years and are excercisable 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 of the date of grant.
During the last fiscal year, Messrs. Gerlach, Carroll,
Wainwright, Graber, Mathias and Ms. Dally were each granted
options to purchase 1,000 shares at an exercise price of $7.50
per share.
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
<TABLE>
Summary Compensation Table
The following table sets forth the compensation for fiscal
years 1997, 1996 and 1995 for the Company's named executive
officers for fiscal year 1997. The named executive officers
consist of the former Chief Executive Officer (who continues to
serve as Chairman and as an executive officer), the current Chief
Executive Officer, and the two other executive officers of the
Company as of April 30, 1997.
<CAPTION>
Long-Term
Compensation
Annual Compensation Awards
---------------------------------- -------------------------
Other Securities
Name & Fiscal Annual Underlying All Other
Principal Position Year Salary Bonus Compensation Options (#) Compensation
- ------------------------- ------ --------- --------- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
William F. Brandt, Jr. 1997 $238,154 $242,775 $ 0 45,000 $ 4,513 (2)
Chairman & Former 1996 260,540 107,041 2,142 (1) 0 4,917 (2)
Chief Executive Officer 1995 255,200 188,750 2,182 (1) 0 4,230 (2)
James J. Gosa 1997 238,504 280,540 3,465 (1) 35,000 3,951 (3)
President & Chief 1996 189,170 77,737 1,584 (1) 15,000 4,402 (3)
Executive Officer 1995 185,200 135,900 1,813 (1) 0 5,180 (3)
David L. Blount 1997 169,821 169,764 0 21,000 2,947 (4)
Vice President, 1996 163,343 68,808 0 9,000 2,867 (4)
Manufacturing 1995 152,175 111,600 0 0 2,738 (4)
Kent B. Guichard 1997 155,205 157,920 0 20,000 2,513 (5)
Vice President, Finance & 1996 143,144 63,147 0 5,000 2,313 (5)
Chief Financial Officer 1995 137,381 101,925 0 0 1,490 (5)
</TABLE>
(1) Company paid spousal travel expenses.
(2) Contributions made on Mr. Brandt's behalf by the Company
under the Investment Savings Stock Ownership Plan were $3,409,
$3,690, and $3,604, for fiscal 1997, 1996 and 1995, respectively.
Company-paid premiums for group life insurance made on Mr.
Brandt's behalf were $1,104, $1,227, and $626, for fiscal 1997,
1996 and 1995, respectively.
(3) Contributions made on Mr. Gosa's behalf by the Company under
the Investment Savings Stock Ownership Plan were $2,654, $2,237,
and $86 for fiscal 1997, 1996 and 1995, respectively. Company-
paid premiums for group life insurance made on Mr. Gosa's behalf
were $559, $491, and $418, for fiscal 1997, 1996, and 1995,
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 $738, $1,674 and $4,676 in
fiscal years 1997, 1996 and 1995, respectively.
<PAGE>
(4) Contributions made on Mr. Blount's behalf by the Company
under the Investment Savings Stock Ownership Plan were $2,539,
$2,484, and $2,449, for fiscal 1997, 1996 and 1995, respectively.
Company-paid premiums for group life insurance made on Mr.
Blount's behalf were $408, $383, and $289, for fiscal 1997, 1996,
and 1995, respectively.
(5) Contributions made on Mr. Guichard's behalf by the Company
under the Investment Savings Stock Ownership Plan were $2,310,
$2,188, and $1,391 for fiscal 1997, 1996 and 1995, respectively.
Company-paid premiums for group life insurance made on Mr.
Guichard's behalf were $203, $125, and $99 for fiscal years 1997,
1996 and 1995, respectively.
<TABLE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information concerning options
granted during fiscal 1997 to the Company's named executive
officers under the 1996 Stock Option Plan for Employees.
<CAPTION>
Potential Realizable
Value at Assumed
Annual Rates
of Stock Price
Appreciation
Individual Grants For Option Term
---------------------------------------------------------- -------------------
Number of
Securities Percent of Total
Underlying Options Granted Exercise
Options to Employees or Base Expiration
Name Granted (#) in Fiscal Year(%) Price($/Share) Date 5% ($) 10% ($)
- ---------------------- ----------- ----------------- -------------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
William F. Brandt, Jr. 10,000 5.0% $ 6.50 8/20/2006 $ 40,878 $103,593
William F. Brandt, Jr. 35,000 17.4 13.13 4/03/2007 289,009 732,404
James J. Gosa 35,000 17.4 5.25 6/11/2006 115,559 292,850
David L. Blount 21,000 10.5 6.50 8/20/2006 85,844 217,546
Kent B. Guichard 20,000 10.0 6.50 8/20/2006 81,756 207,187
</TABLE>
The exercise price of shares of Common Stock covered by the
options granted under the 1996 Employee Stock Option Plan must be
no less than 100% of the fair market value of the Common Stock on
the date of the option grant. Options are exercisable at a rate
of 33% per year beginning on the first anniversary of the date on
which the options were granted. The options must be exercised
within ten years from the date of grant, at which time the
options expire.
<PAGE>
<TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
The following table summarizes options exercised during fiscal
1997 and presents the values of unexercised options held by the
Company's named executive officers at April 30, 1997.
<CAPTION>
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options Options
at FY-End (#) at FY-End($)
Shares Acquired Value Exercisable / Exercisable /
Name On Exercise (#) Realized ($) Unexercisable Unexercisable
- ---------------------- --------------- ------------ ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
William F. Brandt, Jr. 0 $ 0 8,333 E $ 52,533 E
41,667 U 40,833 U
James J. Gosa 27,500 151,276 16,667 E 127,292 E
33,333 U 254,583 U
David L. Blount 5,500 15,065 12,500 E 86,375 E
20,000 U 135,250 U
Kent B. Guichard 22,000 223,621 8,334 E 54,583 E
16,666 U 109,167 U
</TABLE>
<TABLE>
LONG-TERM INCENTIVE PLAN - AWARDS IN LAST FISCAL YEAR
The following table sets forth information concerning long-
term incentives granted during fiscal 1997 to the Company's named
executive officers under the Shareholder Value Plan for
Employees.
<CAPTION>
Number of
Shareholder
Value Plan Performance or Estimated Future Payouts
(SVP) Units Other Period Under Non-Stock Price-Based Plans
Awarded in Until Maturation ----------------------------------
Name Fiscal Year or Payout Threshold Target Maximum
- ---------------- ----------- ----------------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
James J. Gosa 45 5/1/96 to 4/30/99 $ 22,500 $ 87,750 $135,000
David L. Blount 26 5/1/96 to 4/30/99 13,000 50,700 78,000
Kent B. Guichard 24 5/1/96 to 4/30/99 12,000 46,800 72,000
</TABLE>
<PAGE>
The Shareholder Value Plan is administered by the
Compensation Committee of the Board of Directors. 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.
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.
<PAGE>
All awards will be paid as soon as administratively
practicable following the last day of the performance period to
which the award relates (except 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.
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 and/or a commission, 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 calendar years in
the ten calendar years prior to the participant's retirement that
produce the highest average compensation, and the participant's
years of credited service. The plan is a continuation of a
pension plan that was 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 his or her credited service under both the Boise
Cascade plan and 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, 1997, the credited years of service for
Messrs. Brandt, Gosa, Blount and Guichard were 26, 5, 20 and 3,
respectively.
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
<PAGE>
The IRS places limits on the amount of compensation that can
be recognized under this plan as well as the maximum amount of
retirement benefits 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 1997, the maximum annual compensation which may be
recognized is $160,000, and the maximum amount of benefit that
may be paid is $125,000.
REPORT OF THE COMPENSATION COMMITTEE
The Compensation Committee of the Board of Directors is
responsible for the establishment of policies and procedures
governing executive compensation. The Committee is comprised
entirely of non-employee directors.
During the past year, the Compensation Committee performed a
comprehensive review of executive compensation with the
assistance of a leading independent compensation consultant.
This report summarizes the current philosophy of the Committee
regarding executive compensation.
COMPENSATION PHILOSOPHY
The Company's executive compensation program is designed to
assist in attracting, motivating, and retaining qualified senior
management. The fundamental objective of the compensation
program is to support the achievement of the Company's business
objectives and, thereby, the creation of long-term shareholder
value. To this end, the Company's philosophy is that executive
compensation policy and practice should be designed to achieve
the following objectives:
* Align the interests of executive management with those of
the Company and its shareholders by providing a significant
portion of total compensation in Company Common Stock or other
instruments which derive value consistent with the return to
shareholders;
* Provide an incentive to executive management by tying a
meaningful portion of compensation to the specific achievement of
desired results; and
* Enable the Company to attract and retain key executives
whose skills and capabilities are needed for the continued growth
and success of the Company by offering competitive total
compensation and attractive career opportunities.
The Compensation Committee believes that total return to the
shareholder should be a major determinant of long-term executive
compensation. While a significant portion of compensation may
fluctuate with annual results, the total program is structured to
emphasize long-term performance and sustained growth in
shareholder value.
<PAGE>
The Compensation Committee believes that base salaries and
target incentive compensation for executive management should
approximate the averages found in publicly traded peer companies.
The Committee further believes that a substantial portion of
target compensation should be at risk based on performance.
Actual incentive compensation, therefore, should include elements
which result in significant variability based on performance.
Executive management should have an opportunity for superior
compensation with superior results. While overall Company
performance is emphasized in an effort to encourage and reward
teamwork, individual compensation should include some elements
which reflect individual responsibilities and contribution. At
risk performance-based compensation averaged approximately 52% of
total annual cash compensation for the executive group during the
fiscal year ended April 30, 1997.
The Compensation Committee also believes executives should
have a substantial equity ownership position to provide long-term
incentives which closely link executive compensation to the
Company's long-term performance and return to shareholders.
Ownership may be through both direct ownership and through stock
options and other stock-based awards.
COMPETITIVE POSITIONING
The Compensation Committee regularly reviews executive
compensation levels to ensure that the Company will be able to
attract and retain the caliber of executives needed to
effectively operate the Company and that pay for executives is
reasonable and appropriate relative to current market practice.
In making these evaluations, the Compensation Committee annually
reviews the results of surveys of executive salary and incentive
levels among peer companies and other durable goods manufacturers
of similar size. In addition, the Compensation Committee
periodically completes an in-depth analysis of salaries, annual
bonuses and long-term incentives assisted by an independent
outside compensation consulting firm.
<PAGE>
COMPONENTS OF EXECUTIVE COMPENSATON
The principal components of the Company's executive
compensation program include base salary, annual cash bonus, long-
term incentives and benefits.
BASE SALARY. Base salaries for all executives have been
competitively established based on salaries paid for like
positions in comparable companies. The companies used for
comparison of base salaries are not the same companies used in
the Performance Graph section of this proxy. These salaries are
reviewed annually to assure continued competitiveness and are
adjusted when necessary. Based on national surveys available to
the Compensation Committee and information provided by an
independent consultant, the Compensation Committee believes that
executive management, as a group, is paid at the average market
rate. As is the case with the salaried administration policy for
the entire Company, adjustments to executive base salaries result
from a demonstrated increase in skills or from market-driven
changes in comparable positions.
ANNUAL CASH BONUS. The purpose of the Company's annual
incentive program is to provide a direct monetary incentive to
executives in the form of an annual cash bonus which is tied to
the achievement of measurable, predetermined performance
objectives. The annual incentive bonus reflects overall Company
financial performance and, for certain executives, an
individual's contribution to that performance. All executive
officers are eligible for an annual bonus, with a maximum
potential of 100% or 110% of base pay. Vice Presidents of the
company were eligible for 100% of base pay during fiscal 1997,
with the following components used in determining bonus payout:
Net Income (42% of base pay), Cash Flow (28% of base pay) and
Individual Performance (30% of base pay). The Chairman and the
President & Chief Executive Officer were eligible for 110% of
base pay during fiscal 1997, with the following components used
in determining bonus payout: Net Income (65% of base pay) and
Cash Flow (45% of base pay). No annual incentives are paid below
certain predetermined levels of minimal performance.
LONG-TERM INCENTIVES. Long-term incentive compensation
involves the use of two types of stock-based instruments: stock
options and shareholder value units. Both types of incentives
are intended to focus the attention of executives on the
achievement of the Company's long-term performance objectives, to
align executive management's interests with those of shareholders
and to facilitate executives' accumulations of sustained
ownership of Company stock. The levels of award opportunities,
as combined under both instruments, are intended to be consistent
with typical levels of comparable companies and to reflect an
individual's level of responsibility and performance. The
companies used for comparison of long-term incentives are not the
same companies used in the Performance Graph section of this
proxy.
<PAGE>
Stock options, as awarded under the 1996 Stock Option Plan
for Employees, give executives the opportunity to purchase
American Woodmark Corporation Common Stock for a term not to
exceed ten years and at a price of no less than the fair market
value of the Company's stock on the date of grant. Executives
benefit from stock options only to the extent the stock price
appreciates after the grant of the option. Details concerning
option grants may be found in the Option Grant Table.
Shareholder value units, as awarded under the Shareholder
Value Plan for Employees, give executives the opportunity to
receive incentive cash payments based on the comparative total
return to the shareholders of American Woodmark versus the total
returns of those companies included in the S&P Home Furnishings
and Appliance Index. This Index is the same measurement used in
the Performance Graph in this Proxy. Executives may be eligible
for cash incentives if the Company provides a total return to
shareholders above the fiftieth percentile of this group of
companies over a three-year period. Details concerning
Shareholder Value Unit awards may be found in Long-Term Incentive
Plan Awards Table.
BENEFITS. Benefit programs for executives are designed to
provide protection against financial catastrophe that can result
from illness, disability or death. Benefits offered to senior
executives are those offered to all employees.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
The total compensation for the Chief Executive Officer in
fiscal 1997 was established in accordance with the policies
discussed above in this report. As reported in the Summary
Compensation Table, Mr. Gosa's base salary increased by 26%
during the fiscal year and reflected a change in Mr. Gosa's
responsibilities from President and Chief Operating Officer to
President and Chief Executive Officer. Mr. Gosa received an
annual cash bonus according to the plan and based on the
achievement of certain net income and cash flow targets. Mr.
Gosa's stock option award and stock value unit grants were
consistent with the Company's compensation philosophy, and the
target value for these incentives is comparable to like positions
at similar companies.
As reported in the Summary Compensation Table, Mr. Brandt's
base salary decreased by 8.6% during the fiscal year and
reflected a change in Mr. Brandt's responsibilities from Chairman
and Chief Executive Officer to Chairman. Mr. Brandt received an
annual cash bonus according to the plan and based on the
achievement of certain net income and cash flow targets. Mr.
Brandt's stock option awards were consistent with the Company's
compensation philosophy and the target value for this incentive
is comparable to like positions at similar companies.
<PAGE>
COMPLIANCE WITH SECTION 162(m) OF THE INTERNAL REVENUE CODE
The company is subject to Section 162(m) of the Internal
Revenue Code, which imposes a $1 million limit on the amount of
compensation that may be deducted by the Company for a taxable
year with respect to each of the Chief Executive Officer and the
four most highly compensated executive officers of the Company.
Performance-based compensation that meets certain requirements is
not subject to the deduction limit. The Committee has reviewed
the impact of Section 162(m) on the Company and believes that it
is unlikely that the compensation paid to Mr. Gosa or any of the
other named executive officers during the current fiscal year
will exceed the limit. Furthermore, the 1996 Stock Option Plan
for Employees and the Shareholder Value Plan for Employees are
generally designed to comply with the requirements of the
performance-based compensation exception from the $1 million
limit. The Committee will continue to monitor the impact of the
Section 162(m) limit on the Company and to assess alternatives
for avoiding any loss of tax deductions in future fiscal years.
Martha M. Dally, Chairperson
John T. Gerlach
C. Anthony Wainwright
PERFORMANCE GRAPH
Set forth below is a graph comparing the five-year cumulative
total shareholder return from investing $100 on May 1, 1992 in
American Woodmark Corporation Common Stock, the S&P 500 Index,
and the S&P Home Furnishings and Appliance Index:
Source 1992 1993 1994 1995 1996 1997
- -------------------- ------ ------ ------ ------ ------ ------
American Woodmark $100.0 $100.0 $145.6 $145.6 $124.6 $328.5
S&P 500 Index 100.0 109.2 115.0 135.1 175.8 220.0
S&P Home Furnishings 100.0 104.2 129.4 119.4 141.8 136.1
and Appliance Index
CERTAIN TRANSACTIONS
The Company leases its headquarters from Amwood Associates,
a partnership of Messrs. Brandt, Mathias and Graber, and Ms.
Stout. The lease commenced on March 18, 1986 and has a remaining
term of four years, at which time it may be canceled by either
party. Current monthly rental payments are $31,869 per month and
are subject to annual increases, not to exceed 7%, based on
changes in the Consumer Price Index. During the fiscal year
ended April 30, 1997, the Company made payments under the lease
in the amount of $377,000. 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.
<PAGE>
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 1998, 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
Company's Annual Meeting. 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 1998.
OTHER BUSINESS
If any other business properly comes before the Annual
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 at the Annual Meeting.
PROPOSALS BY SHAREHOLDERS FOR PRESENTATION AT 1998 ANNUAL MEETING
Proposals which any shareholder intends to present to the
1998 Annual Meeting of Shareholders must be received by the
Company no later than March 15, 1998.
By Order of the Board of
Directors
Carol Lentz
Secretary
July 24, 1997
<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 27, 1997
The undersigned hereby appoints Martha M. Dally and Daniel
T. Carroll (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 July 1, 1997, at the annual meeting of
shareholders to be held on August 27, 1997, 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 AUTHORITY C. Anthony Wainwright, Martha M.
listed to the to vote for all Dally, James J. Gosa, Daniel T.
right (except as nominees listed Carroll, Fred S. Grunewald.
indicated hereon) 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. In their discretion the proxies are authorized to vote upon
such other business as may properly come before the meeting.
Date , 1997
-----------------------------------
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.
