<PAGE> 1
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant /X/
Filed by a party other than the registrant / /
Check the appropriate box:
/ / Preliminary proxy statement
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
POTLATCH CORPORATION
--------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
POTLATCH CORPORATION
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
--------------------------------------------------------------------------------
(2) Aggregate number of securities to which transactions applies:
--------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
calculated and state how it was determined):
--------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
--------------------------------------------------------------------------------
(5) Total fee paid:
--------------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
(1) Amount previously paid:
--------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
--------------------------------------------------------------------------------
(3) Filing party:
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(4) Date filed:
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<PAGE> 2
[LOGO]
POTLATCH CORPORATION
ONE MARITIME PLAZA
SAN FRANCISCO, CALIFORNIA 94111
ANNUAL MEETING OF STOCKHOLDERS
MAY 18, 1995
------------------------
NOTICE AND PROXY STATEMENT
<PAGE> 3
POTLATCH CORPORATION
ONE MARITIME PLAZA
SAN FRANCISCO, CALIFORNIA 94111
March 27, 1995
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders
which will be held on Thursday, May 18, 1995 at 11:00 A.M. at the Statehouse
Convention Center, Markham and Main Streets, Little Rock, Arkansas.
The formal notice of the Annual Meeting and the Proxy Statement have been
made a part of this invitation.
After reading the statement, PLEASE MARK, DATE, SIGN AND RETURN, AT AN
EARLY DATE, THE ENCLOSED PROXY in the prepaid envelope to Harris Trust and
Savings Bank, our agent, to ensure that your shares will be represented.
The Board of Directors and Management look forward to seeing you at the
meeting.
Sincerely,
[SIG CUT]
JOHN M. RICHARDS
Chairman of the Board and
Chief Executive Officer
------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 18, 1995
The Annual Meeting of the Stockholders of Potlatch Corporation (the
"Company") will be held at the Statehouse Convention Center, Markham and Main
Streets, Little Rock, Arkansas, on Thursday, May 18, 1995 at 11:00 A.M. for the
following purposes:
1. To elect five Directors to serve until the 1998 Annual Meeting of
Stockholders.
2. To ratify the selection of independent auditors.
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on March 21, 1995 as
the record date for determining the stockholders entitled to notice of and to
vote at the Annual Meeting or at any adjournment thereof. A complete list of
stockholders entitled to vote will be available at the offices of Williams &
Anderson, 111 Center Street, Suite 2200, Little Rock, Arkansas, for ten days
prior to the meeting.
[SIG CUT]
SANDRA T. POWELL
Vice President, Financial Services
and Secretary
March 27, 1995
<PAGE> 4
March 27, 1995
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Potlatch Corporation, a Delaware corporation (the
"Company"), One Maritime Plaza, San Francisco, California 94111, of proxies in
the accompanying form to be used at the Annual Meeting of Stockholders to be
held on May 18, 1995, or at any adjournment thereof. The shares represented by
the proxies received pursuant to this solicitation and not revoked will be voted
at the Annual Meeting. A stockholder who has given a proxy may revoke it by
voting in person at the Annual Meeting, by giving written notice of revocation
to the Secretary of the Company or by giving a later dated proxy at any time
before voting. On the matters coming before the Annual Meeting as to which a
choice has been specified by a stockholder by means of the ballot on the proxy,
the shares will be voted accordingly. If no choice is so specified, the shares
will be voted FOR the election of the nominees for Director listed in this Proxy
Statement and FOR approval of the proposal referred to in item 2 in the Notice
of Annual Meeting and described in this Proxy Statement.
The close of business on March 21, 1995 has been fixed as the record date
for determining the holders of the Common Stock entitled to notice of and to
vote at the Annual Meeting. On such date the Company had 29,224,481 shares of
Common Stock outstanding and entitled to vote. As provided in the Company's
Restated Certificate of Incorporation (the "Charter"), a holder of Common Stock
will be entitled to four votes on each matter submitted to a vote of
stockholders for each share of Common Stock beneficially owned on March 21, 1995
which (i) has been beneficially owned continuously from and including March 1,
1991 or (ii) has been acquired pursuant to tax-qualified employee benefit plans
of the Company or the Company's dividend reinvestment plan. A stockholder will
be entitled to one vote per share for each share of Common Stock beneficially
owned on March 21, 1995 which does not meet one of the above criteria.
Stockholders who became beneficial owners of Common Stock within the last 48
calendar months (subsequent to March 1, 1991) will become entitled to four votes
per share with respect to each share held for at least 48 consecutive calendar
months (dating from the first day of the first full month on or after the date
the holder acquired beneficial ownership of such share) prior to the record date
for a stockholders' meeting. In addition, all stockholders are entitled to only
one vote per share on certain matters as specified in the Charter, and it is
anticipated that no such matters will be brought before this Annual Meeting.
Stockholders who own shares of Common Stock in "street" or "nominee" name
are presumed to be entitled to exercise one vote per share and must submit proof
of continued beneficial ownership in order to be entitled to four votes per
share. Such proof must consist of a written certification by the holder that
there has been no change in beneficial ownership of his or her shares for a
period of at least 48 consecutive calendar months as of the record date. The
required form for this certification is provided on the proxy card given to
stockholders who own shares of Common Stock in "street" or "nominee" name. The
Company reserves the right, however, to require additional evidence to determine
whether any such stockholder is entitled to four votes per share.
To transact business at the Annual Meeting, a quorum consisting of a
majority of the voting power of the Company's outstanding shares of Common Stock
and one-third of the total number of shares of Common Stock entitled to vote at
the Annual Meeting must be represented. Under
1
<PAGE> 5
Delaware law and the Company's Charter and By-Laws, the aggregate number of
votes entitled to be cast by all stockholders represented at the Annual Meeting
is counted for the purpose of determining whether there is a sufficient quorum.
A stockholder is deemed to be represented at the Annual Meeting if the
stockholder is present at the Annual Meeting in person or by proxy and has
authority to vote on at least one item.
The affirmative vote of a majority of the voting power present and entitled
to vote at this Annual Meeting is required for approval of any matter voted
upon. Abstentions have the same effect as negative votes. Votes withheld by a
stockholder and broker non-votes are not counted for purposes of determining
whether the item is approved.
A copy of the Company's 1994 Annual Report to Stockholders containing
financial statements for the year ended December 31, 1994 accompanies this Proxy
Statement.
The expense of printing and mailing proxy material will be borne by the
Company. In addition to the solicitation of proxies by mail, solicitation may be
made by certain Directors, officers and other employees of the Company in person
or by telephone, telegraph or telex; no additional compensation will be paid for
such solicitation.
Arrangements will also be made with brokerage firms and other custodians,
nominees and fiduciaries to forward proxy solicitation material to certain
beneficial owners of the Company's Common Stock, and the Company will reimburse
such brokerage firms, custodians, nominees and fiduciaries for reasonable
out-of-pocket expenses incurred by them in connection therewith. The Company has
retained D.F. King & Co., Inc., to aid in the solicitation of proxies for a fee
estimated at $7,500 plus out-of-pocket expenses.
2
<PAGE> 6
ELECTION OF DIRECTORS
(PROPOSAL ONE ON THE PROXY CARD)
The Board of Directors unanimously recommends a vote FOR this proposal.
The Board of Directors is divided into three classes serving staggered
three-year terms. At the 1995 Annual Meeting of Stockholders, five Directors are
to be elected to serve until the 1998 Annual Meeting of Stockholders and until
their respective successors are duly elected and qualified or until the end of
the calendar year in which the Director attains the age of 70 as required by the
Company's By-Laws. It is anticipated that Mr. Jacobson will retire at the end of
1996, and Mr. Jewett at the end of 1997. Upon the retirement of such Directors,
the Board may elect new Directors to complete the term of any retiring Director
or may reduce the number of Directors, or both. All nominees for election are
presently members of the Board of Directors.
Directors are elected by a majority of the votes cast in the election. The
Board of Directors knows of no reason why any of the nominees for Director will
be unable to serve. In the event any of the nominees becomes unable or declines
to serve, the proxies may be voted for the balance of those named and for such
other nominee as the Board may select, or the Board may be reduced accordingly.
INFORMATION WITH RESPECT TO NOMINEES FOR ELECTION AND DIRECTORS CONTINUING IN
OFFICE
Following are the names and ages of the nominees for Director and of the
Directors continuing in office, their principal occupations or employment at
present and for the past five years, certain directorships held by each and the
year in which each became a Director of the Company:
Nominees for Election for a Three-Year Term Ending in 1998
Richard A. Clarke(1).........Mr. Clarke, age 64, became a Director of the
Company in 1985. He is Chairman of the Board of
Pacific Gas and Electric Company (public utility),
San Francisco, California. He also served as its
Chief Executive Officer from May 1986 to June 1994.
Mr. Clarke is also a director of BankAmerica
Corporation.
Allen F. Jacobson(4).........Mr. Jacobson, age 68, became a Director of the
Company in 1990. He served as Chairman of the Board
and Chief Executive Officer of Minnesota Mining and
Manufacturing Company (diversified manufacturing
company), St. Paul, Minnesota, from March 1986
through October 1991. Mr. Jacobson is a director of
Abbott Laboratories, Deluxe Corporation, Minnesota
Mining and Manufacturing Company, Mobil
Corporation, Northern States Power Company, The
Prudential Insurance Company of America, Sara Lee
Corporation, Silicon Graphics, Inc., U S West, Inc.
and Valmont Industries, Inc.
George F. Jewett,
Jr.(1)(3)....................Mr. Jewett, age 67, became a Director of the
Company in 1957. He is Vice Chairman of the Board
of the Company.
Vivian W. Piasecki(3)........Mrs. Piasecki, age 64, became a Director of the
Company in 1992. She is a Trustee of the University
of Pennsylvania (educational institution),
Philadelphia, Pennsylvania. She is also Chairman of
the Board of Overseers for the University of
Pennsylvania School of Nursing and a Board Member
of the University of Pennsylvania Medical Center.
Mrs. Piasecki is also a director of First Fidelity
Bank, NA Pennsylvania Regional Board and the Mutual
Assurance Company.
(Notes are on page 5)
3
<PAGE> 7
Robert G. Schwartz(1)(2).....Mr. Schwartz, age 66, became a Director of the
Company in 1973. He served as Chairman of the Board
of Metropolitan Life Insurance Company (life
insurance), New York, New York from February 1983
through March 1993 and was also its President and
Chief Executive Officer from September 1989 through
March 1993. Mr. Schwartz is also a director of
COMSAT Corp., Consolidated Edison of New York, CS
First Boston, Inc., Lone Star Industries, Inc.,
Lowe's Companies, Inc., Metropolitan Life Insurance
Company, Mobil Corporation and Reader's Digest
Association, Inc.
Directors Continuing in Office Until the 1996 Annual Meeting of Stockholders
Kenneth T. Derr(3)...........Mr. Derr, age 58, became a Director of the Company
in 1994. He is Chairman of the Board and Chief
Executive Officer of Chevron Corporation
(international oil company), San Francisco,
California. Mr. Derr is also a director of
Citicorp.
Toni Rembe(1)(4).............Ms. Rembe, age 58, became a Director of the Company
in 1975. She is a Partner of Pillsbury Madison &
Sutro (law firm), San Francisco, California. Ms.
Rembe is also a director of American President
Companies, Ltd., Pacific Telesis Group and
Transamerica Corporation.
Richard M. Rosenberg(3)(4)...Mr. Rosenberg, age 64, became a Director of the
Company in 1992. He is Chairman of the Board,
President and Chief Executive Officer of
BankAmerica Corporation (bank holding company) and
Bank of America NT&SA (banking institution), San
Francisco, California. Mr. Rosenberg became
Chairman and Chief Executive Officer of BankAmerica
Corporation and Bank of America NT&SA in May 1990.
He served as Vice Chairman of the Board of both
companies from 1987 to February 1990. He also
served as President of both companies from February
1990 to April 1992, resuming that position in
October 1992. Mr. Rosenberg is also a director of
Airborne Express, Northrop Corporation and Pacific
Telesis Group.
Charles R. Weaver(2).........Mr. Weaver, age 66, became a Director of the
Company in 1987. He served as Chairman of the Board
and Chief Executive Officer of The Clorox Company
(household consumer products), Oakland, California,
from April 1986 through June 1992. Mr. Weaver is
also a director of Unocal Corporation.
William T. Weyerhaeuser(2)...Dr. Weyerhaeuser, age 51, became a Director of the
Company in 1990. He is a Clinical Psychologist in
Tacoma, Washington. He is also owner and Chairman
of the Board of Yelm Telephone Company, Yelm,
Washington. Dr. Weyerhaeuser is also a director of
Clearwater Management Company, Inc.
(Notes are on page 5)
4
<PAGE> 8
Directors Continuing in Office Until the 1997 Annual Meeting of Stockholders
Richard B. Madden(1)(3)......Mr. Madden, age 65, became a Director of the
Company in 1971. He served as Chairman of the Board
and Chief Executive Officer of the Company until he
retired in May 1994. Mr. Madden is also a director
of Consolidated Freightways, Inc., Pacific Gas and
Electric Company and URS Corporation.
Richard M. Morrow(2).........Mr. Morrow, age 69, became a Director of the
Company in 1990. He served as Chairman of the Board
and Chief Executive Officer of Amoco Corporation
(petroleum and chemical products), Chicago,
Illinois, from September 1983 through February
1991. Mr. Morrow served as Chairman of the Board of
Westinghouse Electric Corporation (electrical
equipment), Pittsburgh, Pennsylvania, from January
1993 through June 1993. He is also a director of
R.R. Donnelley & Sons Company, First Chicago
Corporation, The First National Bank of Chicago,
Marsh and McLennan Companies, Inc., Seagull Energy
Corporation and Westinghouse Electric Corporation.
John M. Richards(4)..........Mr. Richards, age 57, became a Director of the
Company in 1991. He is Chairman of the Board and
Chief Executive Officer of the Company and has
served in that capacity since May 19, 1994. He
served as the Company's President and Chief
Operating Officer from May 1989 until May 19, 1994.
Reuben F. Richards(2)(4).....Mr. Richards, age 65, became a Director of the
Company in 1974. He is Chairman of the Board of
Terra Industries Inc. (agriculture), New York, New
York and also Chairman of the Board, President and
Chief Executive Officer of Minorco (U.S.A.) Inc.
(natural resources), Denver, Colorado. He became
Chairman of Minorco (U.S.A.) Inc. in May 1990 and
its President and Chief Executive Officer in
February 1994. Mr. Richards served as President and
Chief Executive Officer of Terra Industries Inc.
from June 1983 to May 1991. He is also a director
of Ecolab Inc., Engelhard Corporation, Minorco and
Santa Fe Energy Resources, Inc.
Frederick T. Weyerhaeuser(2)...
Mr. Weyerhaeuser, age 63, became a Director of the
Company in 1960. He is Chairman of the Board and
Treasurer of Clearwater Management Company, Inc.
and Clearwater Investment Trust (financial
management companies), St. Paul, Minnesota.
---------------
(1) Member of the Nominating Committee
(2) Member of the Executive Compensation and Personnel Policies Committee
(3) Member of the Audit Committee
(4) Member of the Finance Committee
5
<PAGE> 9
CERTAIN COMMITTEES OF THE BOARD OF DIRECTORS; MEETINGS
The Company has standing audit, compensation and nominating committees of
the Board of Directors.
Members of the Audit Committee are: Messrs. Kenneth T. Derr, George F.
Jewett, Jr., Richard B. Madden and Richard M. Rosenberg and Mrs. Vivian W.
Piasecki. The functions of this Committee are to: receive from and review with
the Company's independent auditors the annual report of such auditors; review
with the independent auditors the scope of the succeeding annual examination;
nominate the independent auditors to be selected each year by the Company's
Board of Directors; review consulting services, if applicable, provided by the
Company's auditors and evaluate the possible effect on the auditors'
independence of performing such services; ascertain the existence of adequate
internal accounting and control systems; and review with management and the
auditors current and emerging accounting and financial reporting requirements
and practices affecting the Company. This Committee held two meetings during the
fiscal year ended December 31, 1994.
Members of the Executive Compensation and Personnel Policies Committee are:
Messrs. Richard M. Morrow, Reuben F. Richards, Robert G. Schwartz, Charles R.
Weaver, Frederick T. Weyerhaeuser and William T. Weyerhaeuser. The functions of
this Committee are to: review annually and recommend to the Board of Directors
the level of total compensation of the Chairman of the Board; review annually
the recommendations of the Chairman of the Board concerning the salaries and
incentive awards of certain senior officers; administer the Company's stock
option plans and Management Performance Award Plan; and review and make
recommendations to the Board of Directors for changes in the Company's
compensation and benefit plans and practices. This Committee held three meetings
during the fiscal year ended December 31, 1994.
Members of the Nominating Committee are: Messrs. Richard A. Clarke, George
F. Jewett, Jr., Richard B. Madden and Robert G. Schwartz and Ms. Toni Rembe. The
functions of this Committee are to make recommendations with respect to: the
size of the Board; nominees for election as Directors; nominees to serve on
Committees of the Board; and changes in compensation and retirement policy for
Directors. This Committee held three meetings during the fiscal year ended
December 31, 1994. Any stockholder may recommend nominees for Director to the
Nominating Committee by providing to the Secretary of the Company a written
notice by the February 1 preceding the annual meeting of stockholders for which
such nominee is to be considered for nomination. The notice must include the
full name, age, business and residence addresses, principal occupation or
employment of the nominee, the number of shares of Company stock beneficially
owned by the nominee, any other information concerning the nominee that must be
disclosed in proxy solicitations pursuant to Rule 14(a) of the Securities
Exchange Act of 1934 and a written consent of the nominee to the nomination and
to serve, if elected.
The Board of Directors held eight meetings during the fiscal year ended
December 31, 1994. Each of the Directors (except Reuben F. Richards) attended
75% or more of the aggregate number of meetings of the Board and of the
Committees on which such Director served in 1994.
6
<PAGE> 10
STOCK OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth as of January 1, 1995 the number of shares
of Common Stock beneficially owned by each Director, the executive officers
listed in the Summary Compensation Table and by all Directors and executive
officers as a group, as reported by each person. Except as otherwise indicated,
each person has sole investment and voting power with respect to the shares
shown. Shares amounting to less than 1% of the class outstanding are noted by an
asterisk.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP OF
COMMON STOCK
--------------------------------------
NUMBER OF PERCENT OF
SHARES(1)(2)(3) CLASS
--------------- ----------
<S> <C> <C>
DIRECTORS
Richard A. Clarke.................................. 3,104 *
Kenneth T. Derr.................................... 500 *
Allen F. Jacobson.................................. 1,000 *
George F. Jewett, Jr............................... 808,314(4) 2.8%
Richard B. Madden.................................. 138,251 *
Richard M. Morrow.................................. 500 *
Vivian W. Piasecki................................. 116,256(5) *
Toni Rembe......................................... 2,873 *
John M. Richards................................... 65,385 *
Reuben F. Richards................................. 1,200 *
Richard M. Rosenberg............................... 1,000 *
Robert G. Schwartz................................. 2,000 *
Charles R. Weaver.................................. 1,000 *
Frederick T. Weyerhaeuser.......................... 987,867(6)(7) 3.4%
William T. Weyerhaeuser............................ 1,016,663(8)(9) 3.5%
OTHER NAMED EXECUTIVE OFFICERS
George E. Pfautsch................................. 29,780 *
Charles R. Pottenger............................... 34,585 *
L. Pendleton Siegel................................ 49,056 *
Thomas J. Smrekar.................................. 22,232 *
Directors and executive officers as a group
(21 persons including those named above)......... 3,297,738 11.2%
</TABLE>
---------------
(1) Includes shares which may be acquired within 60 days pursuant to the
exercise of options, as follows: Mr. Madden, 113,700 shares; Mr. J. M.
Richards, 54,800 shares; Mr. Pfautsch, 18,500 shares; Mr. Pottenger, 25,850
shares; Mr. Siegel, 34,300 shares; Mr. Smrekar, 14,050 shares; and all
Directors and executive officers as a group, 275,250 shares.
(2) Includes shares owned by Directors and executive officers together with
their respective spouses as follows: Mr. Clarke, 3,104 shares; Mr. Madden,
10,456 shares; Mr. Pfautsch, 2,200 shares; and all Directors and executive
officers as a group, 15,760 shares.
(3) Does not include the following common stock units credited to accounts of
Directors who deferred all or a portion of their Directors' fees under the
stock units method: Mr. Jacobson, 3,315 units; Mr. Morrow, 3,519 units; Mr.
R. F. Richards, 2,672 units; Mr. Rosenberg, 452 units; Mr. Schwartz, 2,739
units; and Dr. W. T. Weyerhaeuser, 3,501 units.
(Notes continued on next page)
7
<PAGE> 11
(4) Includes 601,400 shares held by a trust of which Mr. Jewett is the trustee
and as to which he shares voting and investment power. Includes 129,864
shares held by a foundation of which Mr. Jewett is a trustee and as to which
he shares voting and investment power but disclaims beneficial ownership.
Includes 40,954 shares held by a revocable trust for the benefit of Mr.
Jewett and his wife and as to which he shares voting and investment power.
Includes 36,096 shares held by a revocable trust for the benefit of Mr.
Jewett's wife and as to which he shares voting and investment power but
disclaims beneficial ownership.
(5) Does not include 4,220 shares held directly by Mrs. Piasecki's husband. Also
does not include 17,020 shares held by trusts of which Mrs. Piasecki's
husband is a trustee and as to which he shares voting and investment power.
Mrs. Piasecki disclaims beneficial ownership of all shares described in this
footnote.
(6) Includes proportionate beneficial interests in 119,616 shares held by a
holding company of which Mr. F. T. Weyerhaeuser is a director and as to
which he may be deemed to indirectly share voting and investment power with
others. Mr. F. T. Weyerhaeuser's proportionate beneficial interest in such
shares is 1,875 shares.
(7) Includes a total of 931,360 shares held by trusts of which Mr. F. T.
Weyerhaeuser is a trustee, as to 823,560 of which he shares voting and
investment power. Also includes 132 shares of which he shares investment
power only. Does not include 8,058 shares held directly and indirectly by
Mr. F. T. Weyerhaeuser's wife. Mr. F. T. Weyerhaeuser disclaims beneficial
ownership of all shares described in this footnote.
(8) Includes 119,616 shares held by a holding company of which Dr. W.T.
Weyerhaeuser is Chairman of the Board and Chief Executive Officer and as to
which he has been authorized to exercise sole voting power and indirectly
shares investment power with others. Dr. W.T. Weyerhaeuser disclaims
beneficial ownership of these shares, except for his proportionate
beneficial interest of 569 shares.
(9) Includes a total of 803,481 shares held by trusts of which Dr. W. T.
Weyerhaeuser is a trustee, as to 37,300 shares of which he shares voting
power only, and as to 766,181 shares of which he shares voting and
investment power. Also includes 132 shares of which he shares investment
power only. Does not include 1,200 shares held directly by Dr. W. T.
Weyerhaeuser's wife. Dr. W. T. Weyerhaeuser disclaims beneficial ownership
of all shares described in this footnote.
8
<PAGE> 12
COMPENSATION OF DIRECTORS AND THE NAMED EXECUTIVE OFFICERS
Information is set forth on the following pages as to the compensation paid
or to be paid to, or deferred for the account of, the Directors and the Chief
Executive Officer and each of the four other most highly compensated executive
officers of the Company for services rendered to the Company and its
subsidiaries during 1994.
COMPENSATION OF DIRECTORS
Each Director of the Company who is not also an employee of the Company
receives an annual fee of $24,000. In addition, the Company pays each such
Director a fee of $1,200 for each meeting of the Board of Directors or a
committee of the Board attended in person or by telephone. The chairman of the
Audit Committee and the chairman of the Executive Compensation and Personnel
Policies Committee each receives an additional annual fee of $2,000. By making
an advance election, a Director may defer receipt of any or all of the
Director's fees payable. At the election of a Director, deferred amounts are
credited with interest or converted into common stock units which are credited
with amounts equal to dividends paid on the Company's Common Stock during the
deferral period. During 1994 an aggregate amount of $502,800 in fees was paid to
Directors or deferred on their behalf. Directors are also reimbursed for
reasonable out-of-pocket expenses incurred in attending Board and committee
meetings.
The Company's Directors' Retirement Plan provides an annual benefit to each
Director of the Company who completes five years of service as a nonemployee
Director. The annual benefit is equal to the amount of the regular annual
Directors' retainer fee in effect at the time the individual ceases to be a
Director and does not include supplemental fees for committee chairmanships,
attendance at or participation by telephone in meetings of Directors or any
committee of Directors, or reimbursement of expenses. The benefit continues for
the lesser of 10 years or the number of full years that the individual served as
a nonemployee Director, but benefits may be paid at any time in a lump sum at
the discretion of the Board's Nominating Committee. In addition, benefits will
be paid in a lump sum if the Director's service terminates within three years
following a change in control of the Company or if the Director dies before all
or any required payments have been made.
9
<PAGE> 13
COMPENSATION OF THE NAMED EXECUTIVE OFFICERS
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
------------
ANNUAL COMPENSATION SECURITIES ALL
------------------- UNDERLYING OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS/SARS COMPENSATION(1)
---------------------------------- ----- -------- -------- ------------ ---------------
<S> <C> <C> <C> <C> <C>
John M. Richards.................. 1994 $453,975 $ 98,500 34,600 $ 19,067
Chairman of the Board and 1993 385,600 135,300 30,000 16,195
Chief Executive Officer 1992 372,200 333,300 21,700 15,633
Richard B. Madden(2).............. 1994 273,080 61,400 -- 215,152
Former Chairman of the Board 1993 640,670 249,900 -- 33,408
and Chief Executive Officer 1992 618,700 615,600 41,450 32,486
L. Pendleton Siegel............... 1994 335,000 65,000 22,000 14,070
President and Chief Operating 1993 279,000 82,100 20,000 11,718
Officer 1992 256,000 150,200 10,000 10,752
Charles R. Pottenger.............. 1994 267,300 42,100 11,000 11,228
Group Vice President, Pulp and 1993 233,500 69,500 12,500 9,807
Paperboard 1992 202,500 117,700 6,500 8,505
George E. Pfautsch................ 1994 205,395 35,600 6,600 8,627
Senior Vice President, Finance 1993 190,185 56,600 7,000 7,988
1992 182,775 106,200 6,000 7,677
Thomas J. Smrekar................. 1994 205,200 32,300 8,450 8,618
Group Vice President, Wood 1993 180,200 56,300 7,500 7,568
Products 1992 168,200 100,700 6,500 7,064
</TABLE>
---------------
(1) This column represents matching Company contributions under the Salaried
Employees' Savings Plan, a plan established under section 401(k) of the
Internal Revenue Code. Also, included in this column for Mr. Madden are:
$175,982 of accrued vacation paid upon his retirement; fees of $21,200 paid
in 1994 to Mr. Madden for his services as a non-employee Director following
his retirement as an employee of the Company; and premiums paid by the
Company on a term life insurance policy in the face amount of $250,000
until he is 75. The premium paid in 1994 was $6,500. The Company's
obligation to make such payments terminates if Mr. Madden's marriage
terminates, if he competes with the Company or if he uses skills or
information acquired at the Company relating to the Company's business to
assist others to compete with the Company.
(2) Mr. Madden, who retired in May 1994, is receiving pursuant to an agreement
with the Company supplemental retirement compensation equal to the
difference between the amount payable to him under the Company's Salaried
Employees' Retirement Plan and the amount that would be payable to him if
he received credit for his prior service with Mobil Oil Corporation and its
subsidiaries, and if he were a participant in the Company's Supplemental
Benefit Plan. The agreement also provides for: (i) payment by the Company
of certain survivor benefits to Mr. Madden's widow in the event of his
death; and (ii) credit for Mr. Madden's prior service with Mobil Oil
Corporation and its subsidiaries for purposes of all of the Company's
employee benefit plans and programs, other than plans qualified under
section 401(a) of the Internal Revenue Code.
10
<PAGE> 14
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS(1)
---------------------------------------------------
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/SARS
UNDERLYING GRANTED TO EXERCISE GRANT DATE
OPTIONS/SARS EMPLOYEES IN PRICE EXPIRATION PRESENT
NAME GRANTED FISCAL YEAR PER SHARE DATE VALUE(2)
------------------------------- ------------ ------------ ---------- -------- ----------
<S> <C> <C> <C> <C> <C>
John M. Richards............... 34,600 12% $36.50 12-01-04 $281,000
Richard B. Madden(3)........... -- -- -- -- --
L. Pendleton Siegel............ 22,000 8% 36.50 12-01-04 179,000
Charles R. Pottenger........... 11,000 4% 36.50 12-01-04 89,000
George E. Pfautsch............. 6,600 2% 36.50 12-01-04 54,000
Thomas J. Smrekar.............. 8,450 3% 36.50 12-01-04 69,000
</TABLE>
---------------
(1) All options granted to these named executive officers included stock
appreciation rights ("SARs") that give the optionee the right to surrender
all or part of the option and to obtain payment for the difference between
the aggregate exercise price of the surrendered option shares and the
aggregate fair market value of such shares on the date of exercise. All of
these options were granted on December 1, 1994 with 50% of such grant first
becoming exercisable on December 1, 1995 and the remaining 50% becoming
exercisable on December 1, 1996. In the event of a "change in control" of
the Company, as defined in the option plans, the options granted would
become immediately exercisable in full. In general, a "change in control"
occurs for purposes of the option plans when (i) the Company ceases to be an
independent publicly owned corporation or sells or disposes of all or
substantially all of the assets of the Company, (ii) more than one-third of
the incumbent Directors of the Company neither were Directors three years
earlier nor were elected or nominated with the approval of a majority of the
Directors then in office who were Directors three years earlier, (iii) a
person becomes the beneficial owner of 20% or more of the Company's voting
power pursuant to a tender offer, or (iv) the Company dissolves, liquidates,
or does not survive a merger or consolidation.
(2) This column has been calculated using the Black-Scholes option pricing
model, a complex mathematical formula, utilizing six different
market-related factors to estimate the value of stock options. These factors
are stock price at date of grant, option exercise price, option term,
risk-free rate of return, stock volatility and dividend yield. The
Black-Scholes model generates an estimate of the value of the right to
purchase a share of stock at a fixed price over a fixed period of time. The
actual value, if any, an executive may realize will depend on the excess of
the stock price on the date the option is exercised over the grant price, as
well as the executive's continued employment through the two-year vesting
period and the 10-year option term. The following assumptions were used to
calculate the Black-Scholes value:
<TABLE>
<S> <C>
Stock price at date of grant = $36.50
Option exercise price = $36.50
Option term = 10 years
Risk-free rate of return = Based on rate for 10-year U.S. Treasury note
Company stock volatility = Based on prior three-year monthly stock prices
Company dividend yield = 4.38%
Calculated Black-Scholes
Value = $8.13 per option
</TABLE>
(Notes continued on next page)
11
<PAGE> 15
If the Black-Scholes option pricing model were applied to all outstanding
shares of the Company as of December 1, 1994, the date of grant, the
assumed increased present value for all stockholders would be approximately
$238 million. There is no assurance that the value received by the named
executive officers or the Company's stockholders will be at or near the
estimated value derived by the Black-Scholes model.
(3) Mr. Madden was not granted any options because he retired as an officer in
1994.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS OPTIONS/SARS
SHARES AT FISCAL YEAR-END AT FISCAL YEAR-END(1)
ACQUIRED ON VALUE -------------------------- -------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------------------- ----------- --------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
John M. Richards....... 11,250 $ 160,313 54,800 49,600 $ 22,625 $25,950
Richard B. Madden...... -- -- 113,700 -- 414,463 --
L. Pendleton Siegel.... -- -- 34,300 32,000 36,438 16,500
Charles R. Pottenger... -- -- 25,850 17,250 54,563 8,250
George E. Pfautsch..... 1,000 19,000 18,500 10,100 51,000 4,950
Thomas J. Smrekar...... -- -- 14,050 12,200 17,575 6,338
</TABLE>
---------------
(1) Based on the closing stock price on The New York Stock Exchange-Composite
Transactions of the Company's Common Stock at December 31, 1994 of $37.25
per share.
EXECUTIVE COMPENSATION AND PERSONNEL POLICIES COMMITTEE REPORT ON EXECUTIVE
COMPENSATION
COMPENSATION POLICY
In order to attract, retain and reward a highly competent and productive
employee group, including key executives, it is the policy of the Company that a
total compensation package will be provided that is competitive within the
forest and paper products industry, general industry and the geographic areas in
which the Company operates. This compensation package includes a mix of base
salary, short-term and long-term incentive opportunities and other employee
benefits. Changes in compensation are based on individual performance, the
Company's profit performance and the competitive marketplace. The Company also
intends to qualify compensation paid to its employees in accordance with the $1
million deduction limitation for federal income tax purposes.
Executives receive a base salary and are eligible for awards under two
incentive plans, the Management Performance Award Plan (short-term) and the 1989
Stock Incentive Plan (long-term). Executive compensation is administered by the
Executive Compensation and Personnel Policies Committee of the Board of
Directors (the "Committee"). The Committee consists of the six outside Directors
named at the conclusion of this report.
12
<PAGE> 16
COMPENSATION COMMITTEE RESPONSIBILITIES
The responsibilities of the Committee are:
- to review and recommend annually to the Board of Directors the level of
total compensation of the Chief Executive Officer. Factors evaluated in
the review are the Chief Executive Officer's individual performance, as
measured against written short-term and long-term objectives previously
approved by the Committee, the achievement of the annual corporate
operating budget, Company performance compared to the forest products
industry and the competitive compensation levels for comparable positions
in the forest products industry and general industry;
- to review annually with the Chief Executive Officer the individual
performance, base salaries and incentive awards of the four other most
highly compensated executive officers and certain other senior officers;
- to review and make recommendations on any new stock option/incentive plan
for the Board of Directors' approval prior to submission to stockholders
for their approval and to review and approve all grants made under stock
option/incentive plans;
- to establish the rules and regulations for the Management Performance
Award Plan, which is the Company's annual cash incentive plan ("bonus"),
and to administer the plan in accordance with such rules and regulations;
and
- to review and make recommendations to the Board of Directors regarding
the adoption of or any material changes in the Company's compensation and
benefit plans.
The Committee periodically reviews the entire executive pay structure by
examining surveys of general industry and forest and paper products industry
information on base salaries and short-term and long-term incentives prepared by
an independent compensation consulting firm. These surveys include data from a
broad base of general industry companies and from a base of forest and paper
products companies. This latter base is broader than the S&P Forest Products
Index. General industry surveys are included in the review because the Committee
believes that the Company competes for executive talent against companies other
than those in the forest and paper products industry. The primary purpose of the
review is to insure that the Company's target and actual cash and incentive
compensation programs are consistent with competitive practice. The Committee
considers the median level of the market as competitive.
1994 COMPANY PERFORMANCE
During 1994, the Company earned $1.68 per share or a return on common
stockholders' equity ("ROE") of 5.3%. This compared to $1.31 per share, before
the one-time effects of accounting changes, and an ROE of 4.0% in 1993. The
Company's ROE of 5.3% was below the industry performance in 1994, as measured by
a sample of 19 major forest products companies.(1)
---------------
(1) The forest products industry base for ROE comparison purposes is comprised
of 19 major forest products industry companies. This base is larger and
has in the past created a more difficult ROE comparison than the S&P Forest
Products Index because it includes some additional companies which on
average have exceeded the ROEs of the companies included in the S&P's
12-company Forest Products Index.
13
<PAGE> 17
1994 EXECUTIVE COMPENSATION
The Company's executive annual and long-term compensation consisted of base
salary, a cash payment under the Management Performance Award Plan and a stock
option grant under the 1989 Stock Incentive Plan.
BASE SALARY
The base salary structure is set at competitive levels. Competitive levels
are determined by analyzing independent, job-specific compensation surveys
which, depending on participation and on the position under review, cover
between 15 and 30 forest and paper products companies, many of which are in the
S&P Forest Products Index, and over 300 general industry companies. The
Committee considers the median level of the market as competitive. Any increase
in an executive's base salary is designed to recognize individual performance
against a written performance plan and is expected to fall within annually
established merit increase guidelines which are applicable to all salaried
employees and which are set vis-a-vis competitive practice. The written
performance plans of the executive officers contain specific measures, both
quantitative and qualitative, related to increased earnings, increased
productivity, improved safety performance, and compliance with environmental
requirements.
MANAGEMENT PERFORMANCE AWARD PLAN
The purpose of the plan is to provide an incentive to key employees who are
in a position to contribute to and therefore influence the Company's profit
performance as measured annually on an ROE basis. Payments under the Management
Performance Award Plan are based on individual performance and on the Company's
ROE measured against the ROE of the forest products industry,(1) as described
above, and the Company's comparison of its ROE against the annual corporate
operating budget. Equal weight is given to both profit performance factors to
derive an overall performance modifier. The rules established by the Committee
under the plan have provided that the Chief Executive Officer's and the
President's bonus amounts are further adjusted by plus or minus 50% depending
upon the amount the Company's overall performance modifier exceeds or lags the
overall Company performance target. In early 1995 the Committee amended the
rules to eliminate this formula, which did not take into account individual
performance. As a result, the Chief Executive Officer's and the President's 1994
bonus amounts were made on the same basis as all other participants. No cash
bonuses are recommended by the Committee unless a specified return on common
equity is achieved and the total amount cannot exceed 4% of pre-tax earnings.
The incentive awards for 1994 for the executive officers named in the
Summary Compensation Table reflected the Company's ROE performance against the
annual operating budget and the Company's ROE performance against the forest
products industry,(1) both of which had a negative effect on the awards.
STOCK OPTION PLAN
The purpose of the plan is to further align employees' interests with the
long-term performance of the business and thus, the long-term interests of the
stockholders. Grants are made to employees who have the capacity to influence
the business results. The target grant is based on specific gain objectives by
responsibility level as recommended by the Company's independent compensation
consulting firm. The objective is to provide a gain potential at the median
level of competitive
---------------
(1) See note (1) on page 13.
14
<PAGE> 18
practice as measured by a survey of long-term incentive grant practices among
major industrial companies. The number of options actually granted is affected
by individual performance against performance plans and potential. As stock
options are granted at 100% of the fair market value of the Company's Common
Stock on the grant date, the options have no value unless the stock price
appreciates in the future. Grants vest in 50% increments and are fully vested
two years after the grant date. Executive officers normally are granted stock
appreciation rights ("SARs") in conjunction with stock option grants. The
executive officer may exercise the vested options for cash, with shares of the
Company's Common Stock, or may call the SARs. If the executive officer calls the
SARs, he or she surrenders the option shares and receives a cash payment equal
to the difference between the exercise price and the market price of the option
shares on the surrender date.
In arriving at each individual's 1994 award, the Committee took into
consideration actual individual performance against the annual performance plans
previously described and forecast of potential. The options were granted in
tandem with SARs.
1994 CHIEF EXECUTIVE AND FORMER CHIEF EXECUTIVE PAY
The compensation package of Mr. J. M. Richards consists of the same
elements as for the other officers named in the Summary Compensation Table,
specifically an annual base salary, participation in the annual incentive plan
and participation in the long-term incentive plan. In determining Mr. Richards'
new base salary rate as Chairman and Chief Executive Officer, the Committee
considered chief executive officer pay information for approximately 25 forest
and paper products companies and over 200 general industry companies which
resulted in a 28.4% increase to his previous base salary rate as President and
Chief Operating Officer. For 1994, Mr. Richards received an incentive award
under the Management Performance Award Plan of $98,500. This award reflected the
Company's ROE performance against the annual operating budget and the Company's
ROE performance against the forest products industry(1) as well as Mr. Richards'
performance against his performance plan. During 1994, Mr. Richards was awarded
a grant of 34,600 stock options in tandem with SARs. In arriving at this award,
the Committee considered Mr. Richards' performance against his performance plan
and his potential.
Mr. Madden retired as Chairman of the Board and Chief Executive Officer
upon the adjournment of the Annual Meeting of Stockholders in May 1994. Based on
his 1993 performance against his performance plan, Mr. Madden received a 3%
salary increase on March 1, 1994. This increase fell within the Company's 1994
merit increase guidelines applicable to all employees. For 1994, Mr. Madden
received an incentive plan award under the Management Performance Award Plan of
$61,400. This award reflected the Company's ROE performance against the annual
operating budget and the Company's ROE performance against the forest products
industry(1) as well as Mr. Madden's performance against his performance plan.
THE EXECUTIVE COMPENSATION AND PERSONNEL POLICIES COMMITTEE MEMBERS
F. T. Weyerhaeuser, Chairman
R. M. Morrow
R. F. Richards
R. G. Schwartz
C. R. Weaver
W. T. Weyerhaeuser
---------------
(1) See note (1) on page 13.
15
<PAGE> 19
PERFORMANCE GRAPHS
FIVE-YEAR GRAPH
The following five-year graph shows the yearly percentage change in the
total return on the Company's Common Stock as compared with the indicated
indices for the periods set forth. The total returns are determined based on the
changes in the prices of the common stocks and assume quarterly reinvestment of
all dividends based on an original investment of $100.
[FIVE-YEAR GRAPH]
<TABLE>
<CAPTION>
1989 1990 1991 1992 1993 1994
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Potlatch Corporation........................... $100 $82 $112 $139 $147 $121
S&P Forest Products............................ 100 91 111 131 144 150
S&P 500 Composite.............................. 100 97 126 136 149 152
</TABLE>
16
<PAGE> 20
TWENTY-FOUR YEAR GRAPH
The Company believes long-term performance is also important to
stockholders. Accordingly, the following graph covering the past 24 years is
presented. The method of measuring performance is the same as that used in the
five-year graph except dividends are assumed to be reinvested annually instead
of quarterly. The Company selected the base period of 1970 because the S&P 500
return, the S&P Forest Products return and the Company's Common Stock return for
the first four years following that year were comparatively close. Therefore,
the base period selected has a smaller impact on the long-range returns.
[TWENTY-FOUR YEAR GRAPH]
<TABLE>
<CAPTION>
S&P Forest
Measurement Period Potlatch Corporation Products Index S&P 500 Index
------------------ -------------------- -------------- -------------
<S> <C> <C> <C>
Measurement Pt.
12/31/70 $100 $100 $100
FYE 12/31/71 $92 $102 $111
FYE 12/31/72 $99 $118 $134
FYE 12/31/73 $105 $135 $114
FYE 12/31/74 $103 $100 $83
FYE 12/31/75 $213 $165 $116
FYE 12/31/76 $307 $216 $144
FYE 12/31/77 $264 $167 $133
FYE 12/31/78 $281 $166 $141
FYE 12/31/79 $296 $189 $169
FYE 12/31/80 $386 $237 $225
FYE 12/31/81 $319 $225 $212
FYE 12/31/82 $410 $263 $222
FYE 12/31/83 $440 $370 $320
FYE 12/31/84 $352 $389 $340
FYE 12/31/85 $479 $487 $449
FYE 12/31/86 $750 $650 $533
FYE 12/31/87 $760 $695 $569
FYE 12/31/88 $859 $750 $656
FYE 12/31/89 $1,048 $917 $860
FYE 12/31/90 $862 $837 $833
FYE 12/31/91 $1,177 $1,016 $1,083
FYE 12/31/92 $1,460 $1,198 $1,163
FYE 12/31/93 $1,543 $1,318 $1,279
FYE 12/31/94 $1,271 $1,374 $1,295
</TABLE>
17
<PAGE> 21
OTHER EMPLOYEE BENEFIT PLANS
Pension Plan Table
The table which follows shows a schedule of estimated annual pension
benefits to be payable under the Company's Salaried Employees' Retirement Plan
(the "Retirement Plan") and Supplemental Benefit Plan at normal retirement date
to a person having the average annual earnings and years of credited service
shown.
<TABLE>
<CAPTION>
AVERAGE YEARS OF CREDITED SERVICE
ANNUAL --------------------------------------------------------------------
EARNINGS 15 20 25 30 35 40
--------------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
$ 200,000........... $ 43,056 $ 57,408 $ 71,760 $ 86,112 $100,464 $110,464
400,000........... 88,056 117,408 146,760 176,112 205,464 225,464
600,000........... 133,056 177,408 221,760 266,112 310,464 340,464
800,000........... 178,056 237,408 296,760 356,112 415,464 455,464
1,000,000........... 223,056 297,408 371,760 446,112 520,464 570,464
</TABLE>
In calculating final average annual earnings, the Retirement Plan and the
Supplemental Benefit Plan recognize overtime, bonuses under the Management
Performance Award Plan and other salary- or sales-based performance incentive
payments paid or deferred after 1987, as reflected in the Summary Compensation
Table for the last three years. Bonuses are recognized in the year in which they
are paid. The benefits of participants who are required to retire at age 65 are
calculated as if they received a standard bonus under the Management Performance
Award Plan during each year after 1991 in their period of average annual
earnings.
The years of service used in calculating retirement benefits for Messrs.
Richards, Madden, Siegel, Pottenger, Pfautsch and Smrekar are 30, 38, 16, 27, 32
and 21, respectively. The 1994 compensation (including an assumed standard
bonus) covered by the Retirement Plan, Supplemental Benefit Plan and
supplemental contract of Mr. Madden was: Mr. Richards $627,495; Mr. Madden
$593,415; Mr. Siegel $438,900; Mr. Pottenger $349,025; Mr. Pfautsch $271,960;
and Mr. Smrekar $268,270. Benefits under the plans are computed as straight-life
annuity amounts and are not subject to reduction by Social Security or other
benefits.
Severance Program for Executive Employees. Under the Severance Program for
Executive Employees, participants who are terminated for reasons other than
misconduct, resign within two years after a material change in compensation,
benefits, assigned duties, responsibilities, privileges or perquisites, or
resign rather than relocate at the Company's request, are entitled to receive
severance pay of up to 12 months' base salary and benefits for the same period
of time under the Company's medical, dental, accidental death and dismemberment
and life insurance plans. They also receive unused and accrued vacation pay.
Participants who are terminated or resign in the foregoing circumstances
following a change in control of the Company are entitled to receive severance
pay of up to 2 1/2 times their base salary plus standard bonus, benefits for up
to 2 1/2 years under the Company's medical, dental, disability, accidental death
and dismemberment and life insurance plans, unused and accrued vacation pay, and
the value of their unvested benefits, if any, in the Savings Investment Plan,
Retirement Plan and Supplemental Benefit Plan; provided that the total amount of
all benefits governed by the excess
18
<PAGE> 22
parachute payment provisions of the Internal Revenue Code is limited if the
participant would thereby receive a higher net after-tax benefit.
A change in control of the Company occurs when the Company ceases to be an
independent publicly owned corporation, disposes of substantially all its
assets, ceases to survive because of a dissolution, liquidation, merger or
consolidation, undergoes a substantial change in the composition of its Board of
Directors, or has 20% or more of its Common Stock acquired pursuant to a tender
offer. All principal officers, appointed vice presidents and certain other
designated employees are eligible to participate in the program.
CERTAIN TRANSACTIONS
Pillsbury Madison & Sutro, of which Ms. Rembe is a Partner, provides legal
services to the Company.
BankAmerica Corporation, of which Mr. Rosenberg is Chairman of the Board,
President and Chief Executive Officer, and its subsidiaries provide commercial
banking services and commercial paper placement and agency services to the
Company.
The Company provides Mr. Madden with office space and secretarial support
in order to assist him in representing the Company in civic, community and
industry-related activities on an uncompensated basis.
The Company purchases products from and sells products to Idaho Forest
Industries, Inc., a corporation in which Mr. J. M. Richards has an equity
interest and of which Mr. Richards' brother, W. Thomas Richards, is President
and a director. In 1994 purchases by the Company from and sales to Idaho Forest
Industries, Inc. were approximately $3.3 million and $1.1 million, respectively.
The Company and its subsidiaries engage in transactions from time to time
with several companies in which one of the Company's executive officers or
Directors or a member of his or her immediate family may have a direct or
indirect interest. All such transactions, including those described above, are
in the ordinary course of business and at competitive rates and prices.
Frederick T. Weyerhaeuser and Dr. William T. Weyerhaeuser are first
cousins.
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
(PROPOSAL TWO ON THE PROXY CARD)
The Board of Directors unanimously recommends a vote FOR this proposal.
KPMG Peat Marwick LLP and its predecessors, independent certified public
accountants, have been the auditors for the Company for 43 years.
The Board of Directors has again selected KPMG Peat Marwick LLP to serve as
the Company's independent auditors for the year 1995. While it is not required
to do so, the Board of Directors is submitting to the stockholders the selection
of that firm for ratification in order to ascertain the stockholders' views.
Such ratification of the selection of KPMG Peat Marwick LLP will require a
majority of the votes cast by holders of Common Stock present or represented by
proxy at this Annual Meeting and entitled to vote thereat. If ratification is
not approved, the Board of Directors will reconsider its selection.
19
<PAGE> 23
Representatives of KPMG Peat Marwick LLP are expected to be present at this
Annual Meeting and available to respond to appropriate questions. Such
representatives will have the opportunity to make a statement if they desire to
do so.
STOCKHOLDER PROPOSALS
To be considered for presentation at the 1996 Annual Meeting of the
Company's Stockholders, a stockholder proposal must be received at the offices
of the Company no later than November 28, 1995.
OTHER MATTERS
The Company's By-Laws limit the business that may be brought before an
annual meeting of stockholders to matters included in the notice of meeting,
matters otherwise properly brought before the meeting by the Board of Directors
and matters brought before the meeting by a stockholder provided that notice of
such matter has been received by the Secretary of the Company not less than 30
days nor more than 60 days prior to the meeting. Management knows of no other
business which will be presented to this Annual Meeting. If any other business
is properly brought before this Annual Meeting, it is intended that proxies in
the enclosed form will be voted in respect thereof in accordance with the
judgment of the persons voting the proxies.
Whether you intend to be present at this Annual Meeting or not, you are
urged to return your proxy promptly.
By order of the Board of Directors
[Sig Cut]
SANDRA T. POWELL
Vice President, Financial Services
and Secretary
20
<PAGE> 24
[MAP TO SHAREHOLDER MEETING]
<PAGE> 25
PROXY PROXY
IMPORTANT--THIS PROXY MUST BE SIGNED AND DATED ON THE REVERSE SIDE.
POTLATCH CORPORATION
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD MAY 18, 1995
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby authorizes JOHN M. RICHARDS, L. PENDLETON SIEGEL and
SANDRA T. POWELL, as Proxies with full power in each to act without the other
and with the power of substitution in each, to represent and to vote all the
shares of stock the undersigned is entitled to vote at the Annual Meeting of
Stockholders of Potlatch Corporation to be held on May 18, 1995, or at any
adjournment thereof.
<PAGE> 26
POTLATCH CORPORATION
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY.
[ ]
The Board of Directors unanimously recommends a vote FOR all items.
1. Election of five Directors to serve until the 1998 Annual Meeting of
Stockholders--Nominees: Richard A. Clarke, Allen F. Jacobson, George F.
Jewett, Jr., Vivian W. Plasecki, Robert G. Schwartz
FOR WITHHELD FOR ALL EXCEPT
/ / / / / /
_______________________________________________________________________
2. Ratification of the selection of KPMG Peat Marwick LLP as Independent
Auditors
FOR AGAINST ABSTAIN
/ / / / / /
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting.
THIS PROXY WILL BE VOTED AS DIRECTED BUT IF NOT OTHERWISE DIRECTED, FOR THE
ELECTION OF FIVE DIRECTORS AND FOR PROPOSAL 2.
Dated: _______________________, 1995
___________________________________________________________________________
Signature
___________________________________________________________________________
Signature
(Sign name exactly as imprinted hereon. For joint accounts, both owners should
sign. In signing as attorney, executor, administrator, trustee or guardian, give
full title as such. If signer is a corporation, give full corporate name and
sign by duly authorized officer, showing the officer's title.)
<PAGE> 27
PROXY POTLATCH CORPORATION PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby authorizes JOHN M. RICHARDS, L. PENDLETON SIEGEL and
SANDRA T. POWELL, as Proxies with full power in each to act without the other
and with the power of substitution in each, to represent and to vote all the
shares of stock the undersigned is entitled to vote at the Annual Meeting of
Stockholders of Potlatch Corporation to be held on May 18, 1995, or at any
adjournment thereof.
1. ELECTION OF FIVE DIRECTORS TO SERVE UNTIL THE 1998 ANNUAL MEETING OF
STOCKHOLDERS:
<TABLE>
<S> <C>
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY to vote
(except as marked to the contrary below) for all nominees listed below
</TABLE>
Richard A. Clarke, Allen F. Jacobson, George F. Jewett, Jr., Vivian W. Piasecki,
Robert G. Schwartz
(INSTRUCTION:To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
-------------------------------------------------------------------
2. RATIFICATION OF THE SELECTION OF KPMG PEAT MARWICK LLP AS INDEPENDENT
AUDITORS:
/ / FOR / / AGAINST / / ABSTAIN
3. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR ALL ITEMS.
(Continued and to be signed on other side)
<PAGE> 28
(Continued from other side)
THIS PROXY WILL BE VOTED AS DIRECTED BUT IF NOT OTHERWISE DIRECTED, FOR THE
ELECTION OF FIVE DIRECTORS AND FOR PROPOSAL 2.
By signing below, the undersigned certifies that:
(i) there has been NO change in the beneficial ownership of shares
of Common Stock covered hereby from and including March 1, 1991; and
(ii) there has been a change in the beneficial ownership (such as a
purchase) of shares of Common Stock since that date.
If no certification is made, it will be deemed for purposes of this proxy that
there has been a change in the beneficial ownership of all shares of Common
Stock covered hereby subsequent to March 1, 1991.
<TABLE>
<S> <C>
DATED: ,1995
---------------------------------------------
---------------------------------------------
(SIGN NAME EXACTLY AS IMPRINTED HEREON. FOR
JOINT ACCOUNTS, BOTH OWNERS SHOULD SIGN. IN
SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR,
TRUSTEE OR GUARDIAN, GIVE FULL TITLE AS SUCH.
IF SIGNER IS A CORPORATION, GIVE FULL
CORPORATE NAME AND SIGN BY DULY AUTHORIZED
PLEASE DATE, SIGN AND RETURN OFFICER, SHOWING THE OFFICER'S TITLE.)
</TABLE>
<PAGE> 29
[LETTERHEAD]
March 27, 1995
Dear Participants of the Potlatch Savings Plan:
The Board of Directors of Potlatch Corporation is soliciting proxies to be used
at the Annual Meeting of Stockholders to be held on May 18, 1995 and any
adjournment thereof. Enclosed are Potlatch Corporation's Proxy Statement for
its 1995 Annual Meeting of Stockholders and a card on which you can indicate
your voting instructions.
The stock in your account under the Savings Plan is held by us as Trustee.
Please see the enclosed Confidential Voting Card for details on how your shares
will be voted. In accordance with the time-phased voting provision of Potlatch
Corporation's Restated Certificate of Incorporation, you are entitled to four
votes for each share in your account on the matters to be voted upon at this
year's Annual Meeting. The matters to be presented at the meeting are
described in detail in the attached Notice of Meeting and Proxy Statement.
Please mark your voting instructions on the enclosed card and date, sign and
return this card in the enclosed envelope. Your vote will be held in
confidence.
Very Truly Your,
Putnam Fiduciary Trust Company
<PAGE> 30
PUTNAM FIDUCIARY TRUST COMPANY, TRUSTEE:
POTLATCH CORPORATION
SALARIED EMPLOYEES' SAVINGS PLAN
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
You are authorized and instructed to vote all stock in my Accounts under the
Potlatch Corporation Salaried Employees' Savings Plan at the Annual Meeting of
Stockholders of Potlatch Corporation to be held on May 18, 1995, or at any
adjournment thereof.
1. ELECTION OF FIVE DIRECTORS TO SERVE UNTIL THE 1998 ANNUAL MEETING OF
STOCKHOLDERS:
<TABLE>
<S> <C>
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY to vote
(except as marked to the contrary below) for all nominees listed below
</TABLE>
Richard A. Clarke, Allen F. Jacobson, George F. Jewett, Jr., Vivian W. Piasecki,
Robert G. Schwartz
(INSTRUCTION:To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
-------------------------------------------------------------------
2. RATIFICATION OF THE SELECTION OF KPMG PEAT MARWICK LLP AS INDEPENDENT
AUDITORS:
/ / FOR / / AGAINST / / ABSTAIN
3. ON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE SAID MEETING.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR ALL ITEMS.
(Continued and to be signed on other side)
<PAGE> 31
POTLATCH CORPORATION
SALARIED EMPLOYEES' SAVINGS PLAN
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PLEASE MARK YOUR VOTING INSTRUCTIONS ON THE REVERSE SIDE OF THIS CARD. YOUR
SHARES WILL BE VOTED AS DIRECTED, BUT IF NOT OTHERWISE DIRECTED, FOR THE
ELECTION OF FIVE DIRECTORS AND FOR PROPOSAL 2. IF YOU DO NOT RETURN
THIS CARD, THE TRUSTEE MUST VOTE YOUR PLAN SHARES IN THE SAME
PROPORTION AS VOTED BY OTHER PLAN PARTICIPANTS.
------------------------------------
(PLEASE SIGN EXACTLY AS NAME APPEARS
TO THE LEFT)
Dated: _______________________, 1995
<PAGE> 32
PUTNAM FIDUCIARY TRUST COMPANY, TRUSTEE:
POTLATCH CORPORATION
SAVINGS PLAN FOR HOURLY EMPLOYEES OF THE NORTHWEST PAPER DIVISION
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
You are authorized and instructed to vote all stock in my Accounts under the
Potlatch Corporation Savings Plan for Hourly Employees of the Northwest Paper
Division at the Annual Meeting of Stockholders of Potlatch Corporation to be
held on May 18, 1995, or at any adjournment thereof.
1. ELECTION OF FIVE DIRECTORS TO SERVE UNTIL THE 1998 ANNUAL MEETING OF
STOCKHOLDERS:
<TABLE>
<S> <C>
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY to vote
(except as marked to the contrary below) for all nominees listed below
</TABLE>
Richard A. Clarke, Allen F. Jacobson, George F. Jewett, Jr., Vivian W. Piasecki,
Robert G. Schwartz
(INSTRUCTION:To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
-------------------------------------------------------------------
2. RATIFICATION OF THE SELECTION OF KPMG PEAT MARWICK LLP AS INDEPENDENT
AUDITORS:
/ / FOR / / AGAINST / / ABSTAIN
3. ON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE SAID MEETING.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR ALL ITEMS.
(Continued and to be signed on other side)
<PAGE> 33
POTLATCH CORPORATION
SAVINGS PLAN FOR HOURLY EMPLOYEES OF THE NORTHWEST PAPER DIVISION
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PLEASE MARK YOUR VOTING INSTRUCTIONS ON THE REVERSE SIDE OF THIS CARD. YOUR
SHARES WILL BE VOTED AS DIRECTED, BUT IF NOT OTHERWISE DIRECTED, FOR THE
ELECTION OF FIVE DIRECTORS AND FOR PROPOSAL 2. IF YOU DO NOT RETURN
THIS CARD, THE TRUSTEE MUST VOTE YOUR PLAN SHARES IN THE SAME
PROPORTION AS VOTED BY OTHER PLAN PARTICIPANTS.
------------------------------------
(PLEASE SIGN EXACTLY AS NAME APPEARS
TO THE LEFT)
Dated: _______________________, 1995
<PAGE> 34
PUTNAM FIDUCIARY TRUST COMPANY, TRUSTEE:
POTLATCH CORPORATION
SAVINGS PLAN FOR HOURLY EMPLOYEES OF THE PULP AND PAPERBOARD
AND CONSUMER PRODUCTS DIVISIONS, LEWISTON, IDAHO
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
You are authorized and instructed to vote all stock in my Accounts under the
Potlatch Corporation Savings Plan for Hourly Employees of the Pulp and
Paperboard and Consumer Products Divisions, Lewiston, Idaho, at the Annual
Meeting of Stockholders of Potlatch Corporation to be held on May 18, 1995, or
at any adjournment thereof.
1. ELECTION OF FIVE DIRECTORS TO SERVE UNTIL THE 1998 ANNUAL MEETING OF
STOCKHOLDERS:
<TABLE>
<S> <C>
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY to vote
(except as marked to the contrary below) for all nominees listed below
</TABLE>
Richard A. Clarke, Allen F. Jacobson, George F. Jewett, Jr., Vivian W. Piasecki,
Robert G. Schwartz
(INSTRUCTION:To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
-------------------------------------------------------------------
2. RATIFICATION OF THE SELECTION OF KPMG PEAT MARWICK LLP AS INDEPENDENT
AUDITORS:
/ / FOR / / AGAINST / / ABSTAIN
3. ON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE SAID MEETING.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR ALL ITEMS.
(Continued and to be signed on other side)
<PAGE> 35
POTLATCH CORPORATION
SAVINGS PLAN FOR HOURLY EMPLOYEES OF THE PULP AND PAPERBOARD
AND CONSUMER PRODUCTS DIVISIONS, LEWISTON, IDAHO
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PLEASE MARK YOUR VOTING INSTRUCTIONS ON THE REVERSE SIDE OF THIS CARD. YOUR
SHARES WILL BE VOTED AS DIRECTED, BUT IF NOT OTHERWISE DIRECTED, FOR THE
ELECTION OF FIVE DIRECTORS AND FOR PROPOSAL 2. IF YOU DO NOT RETURN
THIS CARD, THE TRUSTEE MUST VOTE YOUR PLAN SHARES IN THE SAME
PROPORTION AS VOTED BY OTHER PLAN PARTICIPANTS.
------------------------------------
(PLEASE SIGN EXACTLY AS NAME APPEARS
TO THE LEFT)
Dated: _______________________, 1995
<PAGE> 36
PUTNAM FIDUCIARY TRUST COMPANY, TRUSTEE:
POTLATCH CORPORATION
SAVINGS PLAN FOR HOURLY EMPLOYEES OF THE WOOD PRODUCTS GROUP
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
You are authorized and instructed to vote all stock in my Accounts under the
Potlatch Corporation Savings Plan for Hourly Employees of the Wood Products
Group at the Annual Meeting of Stockholders of Potlatch Corporation to be held
on May 18, 1995, or at any adjournment thereof.
1. ELECTION OF FIVE DIRECTORS TO SERVE UNTIL THE 1998 ANNUAL MEETING OF
STOCKHOLDERS:
<TABLE>
<S> <C>
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY to vote
(except as marked to the contrary below) for all nominees listed below
</TABLE>
Richard A. Clarke, Allen F. Jacobson, George F. Jewett, Jr., Vivian W. Piasecki,
Robert G. Schwartz
(INSTRUCTION:To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
-------------------------------------------------------------------
2. RATIFICATION OF THE SELECTION OF KPMG PEAT MARWICK LLP AS INDEPENDENT
AUDITORS:
/ / FOR / / AGAINST / / ABSTAIN
3. ON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE SAID MEETING.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR ALL ITEMS.
(Continued and to be signed on other side)
<PAGE> 37
POTLATCH CORPORATION
SAVINGS PLAN FOR HOURLY EMPLOYEES OF THE WOOD PRODUCTS GROUP
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PLEASE MARK YOUR VOTING INSTRUCTIONS ON THE REVERSE SIDE OF THIS CARD. YOUR
SHARES WILL BE VOTED AS DIRECTED, BUT IF NOT OTHERWISE DIRECTED, FOR THE
ELECTION OF FIVE DIRECTORS AND FOR PROPOSAL 2. IF YOU DO NOT RETURN
THIS CARD, THE TRUSTEE MUST VOTE YOUR PLAN SHARES IN THE SAME
PROPORTION AS VOTED BY OTHER PLAN PARTICIPANTS.
------------------------------------
(PLEASE SIGN EXACTLY AS NAME APPEARS
TO THE LEFT)
Dated: _______________________, 1995
<PAGE> 38
PUTNAM FIDUCIARY TRUST COMPANY, TRUSTEE:
POTLATCH CORPORATION
SAVINGS PLAN FOR HOURLY EMPLOYEES OF THE PULP AND PAPERBOARD
ARKANSAS DIVISION, CYPRESS BEND MILL
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
You are authorized and instructed to vote all stock in my Accounts under the
Potlatch Corporation Savings Plan for Hourly Employees of the Pulp and
Paperboard Arkansas Division, Cypress Bend Mill at the Annual Meeting of
Stockholders of Potlatch Corporation to be held on May 18, 1995, or at any
adjournment thereof.
1. ELECTION OF FIVE DIRECTORS TO SERVE UNTIL THE 1998 ANNUAL MEETING OF
STOCKHOLDERS:
<TABLE>
<S> <C>
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY to vote
(except as marked to the contrary below) for all nominees listed below
</TABLE>
Richard A. Clarke, Allen F. Jacobson, George F. Jewett, Jr., Vivian W. Piasecki,
Robert G. Schwartz
(INSTRUCTION:To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
-------------------------------------------------------------------
2. RATIFICATION OF THE SELECTION OF KPMG PEAT MARWICK LLP AS INDEPENDENT
AUDITORS:
/ / FOR / / AGAINST / / ABSTAIN
3. ON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE SAID MEETING.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR ALL ITEMS.
(Continued and to be signed on other side)
<PAGE> 39
POTLATCH CORPORATION
SAVINGS PLAN FOR HOURLY EMPLOYEES OF THE PULP AND PAPERBOARD
ARKANSAS DIVISION, CYPRESS BEND MILL
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PLEASE MARK YOUR VOTING INSTRUCTIONS ON THE REVERSE SIDE OF THIS CARD. YOUR
SHARES WILL BE VOTED AS DIRECTED, BUT IF NOT OTHERWISE DIRECTED, FOR THE
ELECTION OF FIVE DIRECTORS AND FOR PROPOSAL 2. IF YOU DO NOT RETURN
THIS CARD, THE TRUSTEE MUST VOTE YOUR PLAN SHARES IN THE SAME
PROPORTION AS VOTED BY OTHER PLAN PARTICIPANTS.
------------------------------------
(PLEASE SIGN EXACTLY AS NAME APPEARS
TO THE LEFT)
Dated: _______________________, 1995
<PAGE> 40
[LOGO]
POTLATCH CORPORATION
One Maritime Plaza
PO Box 193591
San Francisco,
California 94119-3591
Telephone (415)
576-8800
March 27,1995
Dear Bank, Broker or Nominee:
Under the Charter of Potlatch Corporation, stockholders who were the
beneficial owners of shares of Common Stock on the record date for the upcoming
meeting of stockholders and who have owned such shares continuously from and
including March 1, 1991 will be entitled to exercise four (4) votes per share
for each such share upon submitting acceptable evidence of beneficial ownership
to the Company. Also under the Charter, stockholders who own shares of Common
Stock in "street" or "nominee" name or through a broker, clearing agency, voting
trustee, bank, trust company or other nominee are presumed to be entitled to
exercise one (1) vote per share for each such share. To become entitled to four
(4) votes per share, a stockholder must provide written proof that there has
been no change in the beneficial ownership of his or her shares from and
including March 1, 1991. Such proof must consist of a written certification in
the form provided on the proxy card.
In certain circumstances, the Company may rely on your representation with
respect to the beneficial owners of shares of Common Stock of Potlatch
Corporation held in your name who are entitled to exercise four (4) votes per
share, provided that such beneficial owners have completed and returned to you
for your records written certifications in the form provided on the proxy card
as to their beneficial ownership and you have forwarded a summary of such voting
information on the summary proxy card on the reverse side of this letter to
Potlatch Corporation or its agent. HOWEVER, THE COMPANY UNCONDITIONALLY RESERVES
THE RIGHT TO REVIEW EACH AND EVERY WRITTEN CERTIFICATION ON ANY PROXY CARD
COMPLETED BY A BENEFICIAL OWNER OF SHARES OF COMMON STOCK OF POTLATCH
CORPORATION TO DETERMINE WHETHER SUCH BENEFICIAL OWNER IS ENTITLED TO EXERCISE
THE CLAIMED FOUR (4) VOTES PER SHARE.
Very truly yours,
[SIG]
Sandra T. Powell
Vice President, Financial Services
and Secretary
<PAGE> 41
PROXY POTLATCH CORPORATION PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby authorizes JOHN M. RICHARDS, L. PENDLETON SIEGEL and
SANDRA T. POWELL, as Proxies with full power in each to act without the other
and with the power of substitution in each, to represent and to vote all the
shares of stock the undersigned is entitled to vote at the Annual Meeting of
Stockholders of Potlatch Corporation to be held on May 18, 1995, or at any
adjournment thereof.
<TABLE>
<CAPTION>
SHARES AS TO WHICH THERE SHARES AS TO WHICH THERE
HAS BEEN NO CHANGE IN HAS BEEN A CHANGE IN
BENEFICIAL OWNERSHIP SINCE MARCH 1, 1991 BENEFICIAL OWNERSHIP SINCE MARCH 1, 1991
------------------------------------------ ------------------------------------------
(POST NUMBER OF SHARES (POST NUMBER OF SHARES
NOT NUMBER OF VOTES) NOT NUMBER OF VOTES)
FOR WITHHOLD FOR WITHHOLD
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
1. ELECTION OF FIVE DIRECTORS TO SERVE
UNTIL THE 1998 ANNUAL MEETING OF
STOCKHOLDERS:
R. A. Clarke
------ shs. ------ shs. ------ shs. ------ shs.
A. F. Jacobson
------ shs. ------ shs. ------ shs. ------ shs.
G. F. Jewett, Jr.
------ shs. ------ shs. ------ shs. ------ shs.
V. W. Piasecki
------ shs. ------ shs. ------ shs. ------ shs.
R. G. Schwartz
------ shs. ------ shs. ------ shs. ------ shs.
</TABLE>
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
2. RATIFICATION OF THE SELECTION OF KPMG
PEAT MARWICK LLP AS INDEPENDENT
AUDITORS
------ shs. ------ shs. ------ shs. ------ shs. ------ shs. ------ shs.
Post only record position. Do not tabulate votes.
</TABLE>
3. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR ALL ITEMS.
THIS PROXY WILL BE VOTED AS DIRECTED BUT IF NOT OTHERWISE DIRECTED, FOR THE
ELECTION OF FIVE DIRECTORS AND FOR PROPOSAL 2.
If the summary voting table above is not completed, it will be deemed for
purposes of this proxy that there has been a change in the beneficial ownership
of all Common Shares covered hereby subsequent to March 1, 1991.
Dated:____________________, 1995
--------------------------------
--------------------------------
--------------------------------
(Sign name exactly as imprinted
hereon. In signing as attorney,
executor, administrator, trustee
or guardian, give full title as
such. If signer is a
corporation, give full corporate
name and sign by duly authorized
officer, showing the officer's
title.)
PLEASE DATE, SIGN AND RETURN
