UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
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:
[X] Preliminary Proxy Statement [_] Soliciting Material Pursuant to
[_] Confidential, For Use of the SS.240.14a-11(c) or SS.240.14a-12
Commission Only (as permitted
by Rule 14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
Dominion Homes, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
________________________________________________________________________________
1) Title of each class of securities to which transaction applies:
________________________________________________________________________________
2) Aggregate number of securities to which transaction applies:
________________________________________________________________________________
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
________________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
________________________________________________________________________________
5) Total fee paid:
________________________________________________________________________________
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
________________________________________________________________________________
2) Form, Schedule or Registration Statement No.:
________________________________________________________________________________
3) Filing Party:
________________________________________________________________________________
4) Date Filed:
________________________________________________________________________________
<PAGE>
DOMINION HOMES, INC.
5501 Frantz Road
P. O. Box 7166
Dublin, Ohio 43017-0766
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD WEDNESDAY, APRIL 26, 2000
Notice is hereby given that the 2000 Annual Meeting of Shareholders
("Annual Meeting") of Dominion Homes, Inc. (the "Company") will be held at The
Dominion Home Store, 5767 Karric Square Drive, Dublin Ohio, on Wednesday, April
26, 2000, at 10:00 a.m. local time, for the following purposes:
1. The election as Directors of the nominees named on the
accompanying Proxy;
2. The amendment of the Company's Amended and Restated Code of
Regulations (the "Code of Regulations") to permit voting by
electronic, telephonic and other types of proxies;
3. The amendment of the Code of Regulations to reduce the
minimum number of Directors comprising a committee of the
Board of Directors from three to one; and
4. The ratification of the selection of PricewaterhouseCoopers
LLP as independent public accountants for the Company in
2000.
A map providing directions to the Annual Meeting is set forth on the outside
back cover of the Proxy Statement.
The Board of Directors has fixed the close of business on March 17,
2000, as the record date for the determination of the shareholders entitled to
notice of and to vote at the Annual Meeting and at any adjournments or
postponements thereof.
You are cordially invited to attend the Annual Meeting. Whether or not
you plan to attend the Annual Meeting, you may ensure your representation by
completing, signing, dating and promptly returning the enclosed proxy card. A
return envelope, which requires no postage if mailed in the United States, has
been provided for your use. If you attend the Annual Meeting and inform the
Secretary of the Company in writing that you wish to vote your shares in person,
your proxy will not be used.
<PAGE>
If your shares are held of record by a broker, bank or other nominee
and you wish to attend the Annual Meeting, you must obtain a letter from the
broker, bank or other nominee confirming your beneficial ownership of the shares
and bring it to the Annual Meeting. In order to vote your shares at the Annual
Meeting, you must obtain from the record holder a proxy issued in your name.
Regardless of how many shares you own, your vote is very important.
Please SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD TODAY.
By Order of the Board of Directors
Robert A. Meyer, Jr.
Secretary
Dublin, Ohio
March 27, 2000
<PAGE>
DOMINION HOMES, INC.
5501 Frantz Road
P. O. Box 7166
Dublin, Ohio 43017-0766
(614) 761-6000
March 27, 2000
PROXY STATEMENT
GENERAL
This Proxy Statement and the accompanying Proxy and Notice of Annual
Meeting of Shareholders are furnished to holders of common shares, without par
value (the "Common Shares"), of Dominion Homes, Inc. (the "Company") in
connection with the solicitation by its Board of Directors (the "Board") of
proxies to be used at the 2000 Annual Meeting of Shareholders of the Company
(the "Annual Meeting") to be held on Wednesday, April 26, 2000, at 10:00 a.m.,
local time, and at any postponements or adjournments thereof. The Annual Meeting
will be held at The Dominion Home Store, 5767 Karric Square Drive, Dublin, Ohio.
A map providing directions to the Annual Meeting is set forth on the outside
back cover of this Proxy Statement. Only those shareholders of the Company of
record at the close of business on March 17, 2000, will be entitled to receive
notice of, and to vote at, the Annual Meeting. Copies of this Proxy Statement
and the accompanying Proxy and Notice of Annual Meeting of Shareholders are
first being mailed to shareholders on or about March 27, 2000.
All Common Shares represented by each properly executed Proxy received
by the Board pursuant to this solicitation will be voted in accordance with the
shareholder's directions specified on the Proxy. Except as described below with
respect to broker non-votes, if no directions have been specified on a Proxy,
the Common Shares represented by the Proxy will be voted in accordance with the
Board's recommendations, which are as follows:
"FOR" the election as Directors of the nominees named on the
accompanying Proxy;
"FOR" the amendment of the Company's Amended and Restated Code of
Regulations (the "Code of Regulations") to permit voting by electronic,
telephonic and other types of proxies;
"FOR" the amendment of the Code of Regulations to reduce the minimum
number of Directors comprising a committee of the Board of Directors from three
to one; and
"FOR" the ratification of the selection of PricewaterhouseCoopers LLP
as independent public accountants for the Company in 2000.
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<PAGE>
Management knows of no other matters that may properly be brought, or
which are likely to be brought, before the Annual Meeting. However, if any other
matters are properly brought before the Annual Meeting, the persons named as
proxies in the accompanying Proxy or their substitutes will vote in accordance
with their best judgment on such matters.
Without affecting any vote previously taken, a shareholder signing and
returning a Proxy has the power to revoke it at any time prior to its exercise
by giving notice to the Company in a writing mailed to Robert A. Meyer, Jr.,
Secretary of the Company, at the Company's executive offices at 5501 Frantz
Road, P. O. Box 7166, Dublin, Ohio 43017-0766, by executing and delivering to
the Company a subsequent Proxy, or by attending the Annual Meeting and giving
notice of such revocation in person to the inspector of elections at the Annual
Meeting. Attendance at the Annual Meeting will not, in and of itself, constitute
revocation of a Proxy.
The presence, in person or by proxy, of the holders of a majority of
the Common Shares issued and outstanding on March 17, 2000, is necessary to
constitute a quorum at the Annual Meeting. As of March 17, 2000, the Company had
6,366,920 Common Shares issued and outstanding.
Under Ohio law and the Code of Regulations, each shareholder is
entitled to one vote for each Common Share held. Common Shares represented by
signed proxies that are returned to the Company will be counted toward the
quorum in all matters even though they are marked as "Abstain," "Against" or
"Withhold Authority" on one or more or all matters or they are not marked at
all. Broker/dealers who hold their customers' Common Shares in street name may,
under the applicable rules of the self-regulatory organizations of which the
broker/dealers are members, sign and submit proxies for such Common Shares and
may vote such Common Shares on routine matters which, under such rules,
typically include the election of Directors and the ratification of the
selection of independent public accountants, but broker/dealers may not vote
such Common Shares on other matters, including the two proposed amendments to
the Code of Regulations, without specific instructions from the customers who
own such Common Shares. Proxies signed and submitted by broker/dealers which
have not been voted on certain matters as described in the previous sentence are
referred to as broker non-votes. Such proxies also count toward the
establishment of a quorum. The effect of an abstention or broker non-vote on
each of the matters to be voted upon at the Annual Meeting is the same as a "no"
vote.
All costs of solicitation of the Proxies will be borne by the Company.
Solicitation will be made by mail. Proxies may be further solicited for no
additional compensation by officers, Directors, or employees of the Company by
telephone, written communication or in person. Upon request, the Company will
reimburse banks, brokerage firms, and other custodians, nominees, and
fiduciaries for expenses reasonably incurred by them in sending proxy materials
to the beneficial owners of Common Shares. No solicitation will be made by
specially engaged employees or other paid solicitors.
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<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
Certain Beneficial Owners
The following table sets forth, as of March 17, 2000, certain
information with respect to persons known to the Company to be the beneficial
owners of more than five percent (5%) of the outstanding Common Shares.
<TABLE>
<CAPTION>
Number of Common Shares Beneficially Owned
Name and Address of Sole Voting and Shared Voting and Shared Investment Percent
Beneficial Owner Investment Power Investment Power Power Only Total of Class(1)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Donald A. Borror(2) 30,000 4,146,500(3) 47,500(4) 4,224,000 66.3%
Douglas G. Borror(2) 65,000 4,146,500(3) 47,500(4) 4,259,000 66.9%
David S. Borror(2) 17,722 4,146,500(3) 7,148(4) 4,171,370 65.5%
Terry E. George(2) 27,000(5) 4,146,500(3) -- 4,173,500 65.3%
BRC Properties Inc. 4,146,500(3) -- -- 4,146,500 65.1%
3970 Brelsford Lane
Dublin, OH 43017
BRC Properties Inc., -- 4,146,500(3)(6) -- 4,146,500 65.1%
Donald A. Borror,
Douglas G. Borror,
David S. Borror and
Terry E. George, as
a group (6)
FMR Corp. 578,000(7) -- -- 578,000 9.1%
82 Devonshire Street
Boston, MA 02109
</TABLE>
(1) Percent of class is based upon the sum of 6,366,920 Common Shares
outstanding as of March 17, 2000, and the number of Common Shares as to
which the person (or members of the group) has the right to acquire
beneficial ownership upon the exercise of options exercisable within sixty
(60) days of March 17, 2000.
(2) These individuals may be contacted at the address of the Company, 5501
Frantz Road, P. O. Box 7166, Dublin, Ohio 43017-0766. [Footnotes continued
on next page]
[Footnotes continued from page 3]
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<PAGE>
[Footnotes continued from page 3]
(3) Share total is based on information provided to the Company by BRC
Properties Inc. ("BRC") By virtue of their ownership and control of BRC,
each of Donald A. Borror, Douglas G. Borror, David S. Borror and Terry E.
George may be deemed to beneficially own the Common Shares owned by BRC,
but each has disclaimed beneficial ownership of the Common Shares owned by
BRC. See "Certain Relationships and Certain Transactions-Description and
Ownership of BRC."
(4) Consists of Common Shares held by KeyTrust Company of Ohio, N.A., as
trustee of the Dominion Homes, Inc. Retirement Plan and Trust (the
"Retirement Plan and Trust"), which Common Shares are voted by the trustee.
(5) Includes 20,000 Common Shares which can be acquired upon the exercise of
options which are exercisable within sixty (60) days of March 17, 2000.
(6) In computing the aggregate number of Common Shares held by the group, the
same Common Shares were not counted more than once.
(7) Information is based on a Schedule 13G filed with the Securities and
Exchange Commission on February 14, 2000.
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<PAGE>
Management
The following table sets forth, as of March 17, 2000, certain
information with respect to the number of Common Shares beneficially owned by
each Director (including nominees) and executive officer of the Company and by
all Directors (including nominees) and executive officers of the Company as a
group:
<TABLE>
<CAPTION>
Number of Common Shares Beneficially Owned
Name and Address of Sole Voting and Shared Voting and Shared Investment Percent
Beneficial Owner Investment Power Investment Power Power Only of Class(1)
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Donald A. Borror(2) 30,000 4,146,500(3) 47,500(4) 4,224,000 66.3%
Douglas G. Borror(2) 65,000 4,146,500(3) 47,500(4) 4,259,000 66.9%
David S. Borror(2) 17,722 4,146,500(3) 7,148(4) 4,171,370 65.5%
Terry E. George(2) 27,000(5) 4,146,500(3) -- 4,173,500 65.3%
C. Ronald Tilley 11,000(5) -- -- 11,000 *
900 Gatehouse Lane
Worthington, OH 43235
Gerald E. Mayo 19,500(5) -- -- 19,500 *
51 Brams Point Road
Hilton Head, SC 29926
Pete A. Klisares 13,000(5) -- -- 13,000 *
1660 Northwest
Professional Plaza
Suite C
Columbus, OH 43220
Jon M. Donnell(2) 155,160(5)(6) -- -- 155,160 2.4%
Robert A. Meyer, Jr.(2) 51,772(5) -- 5,005(4) 56,777 *
Peter J. O'Hanlon(2) 7,000(5)(7) -- -- 7,000 *
All Directors and 397,154 (5) 4,146,500(3) 107,153(4) 4,650,807 71.4%
executive officers as
a group (10 persons)(8)
</TABLE>
* Represents less than 1% of class.
(1) Percent of class is based upon the sum of 6,366,920 Common Shares
outstanding as of March 17, 2000, and the number of Common Shares as to
which the person (or members of the group) has the right to acquire
beneficial ownership upon the exercise of options exercisable within sixty
(60) days of March 17, 2000.
(2) These individuals may be contacted at the address of the Company, 5501
Frantz Road, P. O. Box 7166, Dublin, Ohio 43017-0766.
[Footnotes continued on next page]
-5-
<PAGE>
BOARD OF DIRECTORS AND MANAGEMENT
Number and Term of Directors
The Code of Regulations provides for seven (7) Directors and divides
the Board into two classes, with regular two-year staggered terms. Class I
consists of three (3) Directors with terms expiring in 2001. Class II consists
of four (4) Directors with terms expiring at the Annual Meeting.
Nomination of Directors
In accordance with Section 2.03 of the Code of Regulations, a nominee
for election as a Director at an annual meeting may be proposed only by the
Directors or by a shareholder entitled to vote for the election of Directors if
such shareholder shall have proposed such nominee in a written notice. Each
written notice of a proposed nominee must set forth (1) the name, age, business
or residence address of each nominee proposed in such notice; (2) the principal
occupation or employment of each such nominee for the past five years; and (3)
the number of shares of each series and class of the Company owned beneficially
and/or of record by each such nominee and the length of time any such shares
have been owned. The written notice of a proposed nominee must be delivered or
mailed by first class United States mail, postage prepaid, to the Secretary of
the Company at its principal office and received by the Secretary of the Company
on or before the later of (i) February 1, immediately preceding such annual
meeting or (ii) the sixtieth (60th) day prior to the first anniversary of the
most recent annual meeting of shareholders of the Company held for the election
of Directors, provided, however, that if the annual meeting for the election of
Directors in any year is not held on or before the thirty-first (31st) day next
following such anniversary, then the written notice must be received by the
Secretary within a reasonable time prior to the date of such annual meeting.
[Footnotes continued from page 5]
(3) Share total is based on information provided to the Company by BRC. By
virtue of their ownership and control of BRC, each of Donald A. Borror,
Douglas G. Borror, David S. Borror and Terry E. George may be deemed to
beneficially own the Common Shares owned by BRC, but each has disclaimed
beneficial ownership of the Common Shares owned by BRC. See "Certain
Relationships and Certain Transactions-Description and Ownership of BRC."
(4) Consists of Common Shares held by KeyTrust Company of Ohio, N.A., as
trustee of the Retirement Plan and Trust, which Common Shares are voted by
the trustee.
(5) Includes, in the case of Messrs. Donnell, George, Mayo, Klisares, Tilley,
Meyer, and O'Hanlon, 56,000, 20,000, 12,500, 12,500, 10,000, 38,000, and
2,000 Common Shares, respectively, which can be acquired upon the exercise
of options which are exercisable within sixty (60) days of March 17, 2000.
(6) Includes 33,000 restricted Common Shares which are subject to forfeiture if
Mr. Donnell's employment with the Company is terminated prior to August 1,
2002. The restrictions will lapse as to 11,000 Common Shares on August 1,
2000, August 1, 2001, and August 1, 2002, respectively.
(7) Includes 2,500 restricted Common Shares which are subject to forfeiture if
Mr. O'Hanlon's employment with the Company is terminated prior to June 1,
2000. The restrictions will lapse on June 1, 2000.
(8) In computing the aggregate number of Common Shares held by the group, the
same Common Shares were not counted more than once.
-6-
<PAGE>
The Company has not received any proposals for Director nominations from
any shareholder with respect to the Annual Meeting.
Proposal to Elect Class II Directors
The Board proposes the election of the following persons as Class II
Directors to terms which will expire at the 2002 Annual Meeting of Shareholders:
Director
Name Age Since
Donald A. Borror 70 1978
David S. Borror 42 1985
Pete A. Klisares 64 1994
Gerald E. Mayo 67 1994
All of the nominees are presently members of the Board. All of the
nominees have stated their willingness to serve and no reason is presently known
why any of the nominees would be unable to serve as a Director. It is the
intention of the persons named as proxies in the accompanying Proxy to vote for
the election of the four (4) nominees named above unless the shareholders
otherwise direct on the Proxy. If any nominee is unable to stand for election,
each Proxy will be voted for such substitute as the Board recommends.
Recommendation and Vote
Class II Directors will be elected by a plurality of the votes entitled
to be cast and present at the Annual Meeting, in person or by properly executed
proxy. Shareholders do not have cumulative voting rights in the election of
Directors. Proxies cannot be voted for more than four (4) Directors.
The Board recommends that the shareholders vote "FOR" the election of
its nominees for Class II Directors.
Continuing Class I Directors
The following Class I Directors will continue after the Annual Meeting
to serve as Directors for a term that will expire at the 2001 Annual Meeting of
Shareholders:
Director
Name Age Since
Douglas G. Borror 44 1984
C. Ronald Tilley 64 1996
Jon M. Donnell 40 1997
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<PAGE>
Executive Officers and Certain Other Key Employees
The Company's executive officers and certain other key employees of the
Company are listed below.
<TABLE>
<CAPTION>
Name Age Position(s) Held
- --------------------------------------------------------------------------------
Executive Officers
<S> <C> <C>
Donald A. Borror 70 Chairman Emeritus
Douglas G. Borror 44 Chairman of the Board and Chief Executive Officer
Jon M. Donnell 40 President and Chief Operating Officer
David S. Borror 42 Executive Vice President
Terry E. George 56 Senior Vice President and Treasurer
Robert A. Meyer, Jr. 46 Senior Vice President, General Counsel and Secretary
Peter J. O'Hanlon 41 Senior Vice President-Finance and Chief Financial
Officer
Certain Other Key Employees
Stephan M. George 43 Executive Vice President-Operations
Robert D. Beck, Jr. 47 Senior Vice President-Sales
Karl E. Billisits 34 Senior Vice President-Land Acquisition and
Development
Denis G. Connor 45 Senior Vice President-Administration
Jack L. Mautino 36 Senior Vice President and General
Manager-Louisville Operations
Lori M. Steiner 40 Senior Vice President--Strategy and
Communications
Randolph B. Robert, Jr. 48 Vice President-Land Development
Kenneth C. Baker 52 Vice President-Information Systems
</TABLE>
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<PAGE>
Background and Experience of Directors, Officers and Certain Key Employees
The references to the Company in the following biographies for periods
of time prior to March 9, 1994, refer to the homebuilding divisions of BRC which
were transferred to the Company in connection with the Company's initial public
offering of its Common Shares. See "Certain Relationships and Certain
Transactions--Description and Ownership of BRC."
Donald A. Borror has served on the Company's Board of Directors since
1978, and has served as Chairman Emeritus since July 1999. He served as the
Chairman of the Board of Directors from 1978 through July 1999, and as President
of the Company from 1977 to March 1987. Mr. Borror has been involved in the
homebuilding business since 1952 and founded the Company's homebuilding business
in 1976. He has a Bachelor of Arts degree from The Ohio State University and a
Juris Doctor degree from The Ohio State University College of Law.
Douglas G. Borror has served on the Company's Board of Directors since
January 1984, as Chairman of the Board of Directors since July 1999, as the
Company's President since March 1987, and as its Chief Executive Officer since
September 1992. He also served as Chief Operating Officer of the Company from
September 1992 through September 1996. Mr. Borror also serves on the Boards of
Directors of Columbia Gas of Ohio, Inc. and The Huntington National Bank. Mr.
Borror has a Bachelor of Arts degree from The Ohio State University.
David S. Borror has served on the Company's Board of Directors since
1985 and as its Executive Vice President since January 1988. He served as Vice
President of the Company from July 1985 until January 1988, and as its General
Counsel from January 1988 to December 1993. He has a Bachelor of Arts degree
from The Ohio State University and a Juris Doctor degree from The Ohio State
University College of Law.
Jon M. Donnell has served on the Company's Board of Directors since May
1997, as Chief Operating Officer of the Company since September 1996 and as
Chief Financial Officer of the Company from August 1995 through June 1998. Mr.
Donnell served as Treasurer of the Company from August 1995 through December
1995, and as Executive Vice President from January 1996 through August 1996.
From August 1995 through December 1996, he also served as Senior Vice President
of the Company. Prior to joining the Company, Mr. Donnell spent 11 years with
the Del Webb Corporation, a national real estate development and homebuilding
company, most recently as Vice President and Associate General Manager of Webb's
Sun City Hilton Head community. He served on the Board of Directors of
Healthstar Corporation through July 1999. He is a Certified Public Accountant,
and holds a Bachelor of Science degree from the University of Arizona.
Pete A. Klisares has served on the Company's Board of Directors since
1994. He has served as Principal, MIGG Capital, an Ohio based venture capital
company, since October 1999. From August 1997 through June 1999, he served as
President and Chief Operating Officer of Karrington Communities, Inc., a
Columbus, Ohio-based company which constructs and operates assisted living
facilities. From August 1993 through December 1997, he served as Executive Vice
President of Worthington Industries, Inc., a Columbus-based steel company. He is
a member of the Board of Directors of The Huntington National Bank and MPW
Industrial Services. Mr. Klisares has a Bachelor of Science degree in Economics
and a Masters Degree in Labor and Management from the University of Iowa.
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<PAGE>
Gerald E. Mayo has served on the Company's Board of Directors since
1994. Until his retirement in October 1997, he was a member of the Boards of
Directors and the Chairman of the Midland Life Insurance Company, a Columbus,
Ohio-based life insurance company, and Midland Financial Services, Inc.,
positions which he held for more than five years. He also serves on the Boards
of Directors of McKesson/HBOC, Columbia Gas Systems, Inc. and Columbia Gas of
Ohio, Inc. Mr. Mayo has a Bachelor of Arts degree from Boston University.
C. Ronald Tilley has served on the Company's Board of Directors since
January 1996. In March 1996, he retired as Chief Executive Officer and Chairman
of the Board of Directors of Columbia Gas Distribution Companies, an Ohio-based
natural gas company, positions which he held for more than five years. Mr.
Tilley has a Bachelor of Science degree from Concord College.
Terry E. George has served as Senior Vice President of the Company
since November 1993 and as Treasurer of the Company since January 1996. He
served on the Board of Directors of the Company from 1985 through May 1997, as
Controller of the Company from August 1995 to January 1996, and as Operations
Manager of the Company from October 1991 through August 1995. Mr. George has
also served as Vice President of BRC since December 1996. He served as a Vice
President of BRC from October 1987 to November 1993. Mr. George also serves on
the Board of Directors of First Community Bank. He has a Bachelor of Science
degree from The Ohio State University and is a Certified Public Accountant in
the State of Ohio.
Robert A. Meyer, Jr. has served as Senior Vice President of the Company
since January 1996 and as General Counsel and Secretary of the Company since
December 1993. He served as Vice President of the Company from December 1993
through December 1995. Prior to joining the Company, Mr. Meyer was engaged in
the private practice of law in the Columbus, Ohio office of Porter, Wright,
Morris & Arthur from November 1978 to December 1993. He has a Bachelor of
Science degree from Indiana University and a Juris Doctor degree from The Ohio
State University College of Law.
Peter J. O'Hanlon has served as Senior Vice President of Finance of the
Company since January 2000, and as the Company's Chief Financial Officer since
June 1998. Prior to joining the Company, Mr. O'Hanlon was Controller of Gables
Residential Trust, an Atlanta-based real estate investment trust, from 1993
through May 1998, and Chief Financial Officer of Wilson Company, an
Atlanta-based privately held holding company, from 1987 through 1992. He is a
Certified Public Accountant, and holds a Bachelor of Arts degree from Emory
University and a Masters degree in Business Administration from Northwestern
University.
Stephan M. George has served as the Company's Executive Vice President
of Operations since May 1999. Prior to joining the Company, Mr. George served as
Chief Operating Officer of Silverman Building Company, a Farmington, Michigan
based homebuilding company, from March 1998 through April 1999, and Vice
President of Operations of Cambridge Homes, Inc., a Libertyville, Illinois based
homebuilding company from December 1987 through March 1998. Mr. George has a
Bachelor of Science degree in Civil Engineering from Cornell University and a
Masters degree in Business Administration from Loyola University.
<PAGE>
Robert D. Beck, Jr. has served as the Company's Senior Vice President
of Sales since November 1999. Prior to joining the Company, Mr. Beck was
employed as Vice President, Sales and Marketing, of Liqui-Box Corporation, a
Columbus-based manufacturer of specialty packaging products, from September 1998
through October 1999, as Customer Development Manager for the Pillsbury Company,
Dallas, Texas, a consumer package goods manufacturer, from July 1995 through
April 1998, and as Vice President, Business Development, of Heublein Wines
Group, San Mateo, California, from July 1993 through July 1995. Prior to joining
Heublein, Mr. Beck was employed by the Procter
-10-
<PAGE>
and Gamble Company for fourteen years in several sales capacities. Mr. Beck
holds an Associate Science degree and a Bachelor of Science degree from Cameron
University and a Masters of Science degree from the University of Central Texas.
Karl E. Billisits has served as the Company's Senior Vice President of
Land Acquisition and Development since April 1999. He served as the Company's
Vice President of Engineering and Development from January 1999 through April
1999, as Vice President of Engineering from May 1998 through January 1999, as
Director of Engineering from April 1997 through May 1998, and as Engineer from
April 1994 through April 1997. Prior to joining the Company in 1994, Mr.
Billisits was employed as a consulting engineer with Bauer, Davidson & Merchant,
a Columbus-based consulting engineering firm. Mr. Billisits holds a Bachelor of
Science degree in Civil Engineering from The Ohio State University, and is a
Registered Professional Engineer in the States of Ohio, Kentucky and Michigan.
Denis G. Connor has served as Senior Vice President, Administration,
since joining the Company in January 1998. Prior to joining the Company, Mr.
Connor managed Alliance Title Agency, Ltd., from its formation in April 1997, to
December 1997, and was employed by Chicago Title Agency of Central Ohio, Inc.,
from February 1989 to April 1997. He has a Bachelor of Arts degree from Miami
University.
Jack L. Mautino has served as Senior Vice President and General Manager
of the Company's Louisville, Kentucky Operations since August 1998. He served as
Senior Vice President of Sales of the Company from May 1998 through August 1998,
and as Vice President of Sales from October 1995 through August 1998. He served
as Sales Manager for the Company's Dominion Homes Division from January 1995
through December 1995, as Sales Manager of the Company's Tradition Homes
Division from December 1991 to December 1994, and as Sales Representative for
the Company from July 1990 to December 1991. Prior to joining the Company, Mr.
Mautino was employed by Ryland Homes. He holds a Bachelor of Science degree from
Duquesne University.
Lori M. Steiner has served as Senior Vice President of Strategy and
Communications since January 1999. She served as the Company's Senior Vice
President of Marketing from May 1998 through December 1998, and as the Company's
Vice President of Marketing from January 1995 through May 1998. She served as
the Company's Marketing Director from September 1990 through January 1995. Ms.
Steiner served as an account manager for Brooks Young Communications, a
Columbus-based regional advertising company, from March 1989 to September 1990.
She has a Bachelor of Arts degree from Wittenberg University.
Kenneth C. Baker has served as the Company's Vice President of
Information Systems since May 1998. From April 1997, through May 1998, he served
as the Company's Director of Information Systems and, from October 1994 through
April 1997, as the Company's Manager of Information Systems. Prior to joining
the Company, Mr. Baker was employed as Manager of Information Systems with
Mid-Ohio Chemical Company from 1988 through 1994, and in the same position with
Colso Products, Inc. from 1978 through 1988. Mr. Baker holds an Associates
Degree in Information Systems from Automation Institute of Ohio.
Randolph B. Robert, Jr. has served as the Company's General Manager of
Land Development since January 1987 and as a Vice President since November 1993.
Mr. Robert has a Bachelor of Science Degree from The University of Arizona.
-11-
<PAGE>
Family Relationships
Douglas G. Borror, a Director and the Chairman of the Board and Chief
Executive Officer of the Company, and David S. Borror, a Director and Executive
Vice President of the Company, are brothers. Donald A. Borror, a Director and
Chairman Emeritus of the Company, is the father of Douglas G. Borror and David
S. Borror. There are no other family relationships among the executive officers
and/or Directors of the Company.
Agreement with Respect to the Election of Directors
BRC, the holder of approximately 65.1% of the issued and outstanding
Common Shares, has agreed in a Close Corporation Agreement with its shareholders
to use its best efforts to elect David S. Borror as a Director of the Company
for so long as certain contingencies are satisfied and for so long as BRC has
the ability to elect at least two (2) Directors of the Company. See "Certain
Relationships and Certain Transactions--Description and Ownership of BRC."
Meetings and Committees of the Board
The Board of Directors meets immediately following the adjournment of
each annual meeting of shareholders at which Directors are elected, and holds
such other meetings as may be called from time to time by the Chairman of the
Board, the President or any two Directors. The Board of Directors of the Company
held four meetings during the fiscal year ended December 31, 1999. Each Director
attended at least 75% of the aggregate of the number of Board of Directors
meetings and meetings of all committees on which he served during the year.
The Company has a Compensation Committee, an Executive Committee, an
Audit Committee and an Affiliated Transactions Review Committee. The members of
the Compensation Committee during 1999 were Pete A. Klisares, Gerald E. Mayo,
and C. Ronald Tilley. The Compensation Committee, which determines the
compensation of the Company's executive officers, held two meetings during 1999.
The members of the Executive Committee during 1999 were Donald A. Borror, Pete
A. Klisares, Douglas G. Borror, David S. Borror and Jon M. Donnell. The
Executive Committee, which is authorized to act for the Board between regularly
scheduled meetings of the Board, held three meetings during 1999. The members of
the Audit Committee during 1999 were Pete A. Klisares, Gerald E. Mayo, and C.
Ronald Tilley. The Audit Committee, which reviews accounting and auditing
matters, held one meeting during 1999. The members of the Affiliated
Transactions Review Committee during 1999 were Pete A. Klisares, Gerald E. Mayo,
and C. Ronald Tilley. The Affiliated Transactions Review Committee, which
reviews and authorizes material transactions between the Company and its
affiliates or related parties, held one meeting during 1999. The Company does
not have a standing nominating committee or other committee performing a similar
function.
-12-
<PAGE>
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
Executive Compensation
The following table sets forth, for the three fiscal years ended
December 31, 1999, cash and non-cash compensation paid by the Company to the
Chief Executive Officer and to each of the other four most highly compensated
executive officers of the Company who served as such during 1999 (collectively,
the "Named Executive Officers") for services rendered to the Company in all
capacities by such persons:
<TABLE>
<CAPTION>
Summary Compensation Table
Long-Term
Compensation
Annual Compensation ---------------------------
------------------------------------------------- Restricted Common Shares
Other Annual Stock Underlying All Other
Name and Salary Bonus(1) Compensation(2) Awards Options/ Compensation(3)
Principal Position Year ($) ($) ($) ($) SARs (#) ($)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Donald A. Borror 1999 $250,000 $260,000 -- $ 683
Chairman Emeritus 1998 250,000 260,000 -- 4,250
1997 240,000 260,000 -- 4,250
Douglas G. Borror 1999 $440,000 $550,000 $ 57,585(4) $ 72,438(5)
Chairman and CEO 1998 400,000 550,000 -- 9,300
1997 360,000 500,000 -- 9,125
Jon M. Donnell 1999 $360,000 $400,000 $ 65,119(6) -- -- $ 50,687(5)
President and COO 1998 240,000 400,000 -- 143,688(7 24,000 9,300
1997 189,231 300,000 -- 126,500(7 20,000(8) 55,425(9)
David S. Borror 1999 $200,000 $225,000 $ 23,541(5)
Exec. V.P 1998 192,385(10) 200,000 -- 9,300
1997 175,000 150,000 -- 6,625
Robert A. Meyer, Jr 1999 $160,000 $125,000 -- -- $ 23,591(5)
Sr. V.P. and 1998 155,000 125,000 -- -- 9.300
General Counsel 1997 150,000 115,000 -- 7,500 9,125
</TABLE>
(1) Includes amounts deferred by the Named Executive Officer pursuant to the
Amended and Restated Dominion Homes, Inc. Executive Deferred Compensation
Plan (The "Executive Deferred Compensation Plan").
(2) Perquisites and other personal benefits did not exceed applicable
thresholds except as specifically set forth.
(3) All Other Compensation includes for 1997, 1998 and 1999 amounts paid by the
Company for coverage under the Company's Group Life Insurance Program for
all employees and amounts contributed by the Company to the accounts of the
Named Executive Officers in the Retirement Plan and Trust and in the
Executive Deferred Compensation Plan as matching contributions under the
provisions of those plans.
(4) Includes $23,760 attributable to personal use of the Company aircraft.
[Footnotes continued on next page]
-13-
<PAGE>
Employment Agreements
The Company has Employment Agreements with Jon M. Donnell, President
and Chief Operating Officer, with Robert A. Meyer, Jr., Senior Vice President,
General Counsel and Secretary, and with Peter J. O'Hanlon, Chief Financial
Officer. The Employment Agreements with Messrs. Donnell and Meyer are each dated
May 17, 1996, and effective as of January 1, 1996. The Employment Agreement with
Mr. Donnell was amended on November 6, 1996, to reflect an expansion of Mr.
Donnell's responsibilities. The Employment Agreement with Mr. O'Hanlon is dated
June 1, 1998. The Agreements are for terms of three years, and provide for
renewal annually for three-year terms unless the Company provides notice of its
intention not to renew the Agreement. No such notice by the Company has been
provided to Mr. Donnell, Mr. Meyer, or Mr. O'Hanlon. Each Agreement provides for
lump sum payments if employment is terminated by the Company without cause or by
Mr. Donnell, Mr. Meyer, or Mr. O'Hanlon with good reason, and includes non-
competition covenants effective for one year after termination. The Agreements
also include provisions that become effective upon a "change in control" of the
Company. Under the Agreements, a change in control is defined as an event which
results in either BRC failing to own at least 30% of the combined voting power
of the outstanding voting securities of the Company, or both Mr. Donald Borror
and Mr. Douglas Borror ceasing to be Directors and officers of the Company. Upon
a change in control, all employee benefit rights, including stock options, vest.
In addition, if within two years of a change in control, the employment of Mr.
Donnell, Mr. Meyer, or Mr. O'Hanlon is terminated without cause, or if Mr.
Donnell, Mr. Meyer or Mr. O'Hanlon terminates his employment with good reason,
he would be entitled to certain benefits, including a lump sum payment
equivalent to two years' salary, the payments he would have been entitled to had
the Company terminated his employment without cause and without a change in
control, and certain outplacement services.
[Footnotes continued from page 13]
(5) Includes for 1999 the value of premiums paid for split-dollar life
insurance coverage under the Company's Collateral Assignment Split Dollar
Plan (the "Split Dollar Plan") (Mr. Douglas Borror, $62,488; Mr. Donnell,
$40,737; Mr. David Borror, $13,591; and Mr. Meyer, $13,646). Compensation
attributable to the Named Executive Officers' participation in the Split
Dollar Plan represents the premium attributable to the death benefit
provided under the policy on a term insurance basis, together with the
present value of the interest projected to accrue on the remaining portion
of the current year's insurance premium paid by the Company. The Split
Dollar Plan is discussed in greater detail under "Report of Compensation
Committee on Executive Compensation Long-Term Incentive Compensation-Split
Dollar Plan."
(6) Includes $40,320 attributable to personal use of the Company aircraft.
(7) At December 31, 1999, Mr. Donnell held 33,000 restricted Common Shares with
an aggregate value of $206,250. Of such restricted Common Shares, 11,000
will vest on each of August 1, 2000, 2001 and 2002. Prior to the vesting of
11,000 restricted shares on August 1, 1999, Mr. Donnell elected, pursuant
to the terms of the Dominion Homes, Inc. Incentive Stock Plan (the
"Incentive Stock Plan'), not to receive 5,624 of the restricted Common
Shares in order to satisfy income tax obligations related to such vesting.
It is a prerequisite to the vesting of any restricted Common Shares that
Mr. Donnell be employed with the Company as of the vesting date. The
Company does not presently pay dividends. However, if dividends are paid in
the future, Mr. Donnell would be entitled to receive dividends as to both
his vested and unvested restricted Common Shares. [Footnotes continued on
page 15]
-14-
<PAGE>
Incentive Stock Plan
No SAR's, stock options or long-term incentive plan awards were granted
to any Named Executive Officer under the Incentive Stock Plan during 1999.
The following table sets forth information, as of December 31, 1999,
concerning the number of Common Shares underlying unexercised options and the
value of the unexercised options held by those Named Executive Officers who held
options on such date. No Named Executive Officer exercised any options during
1999.
<TABLE>
<CAPTION>
Aggregated Option/SAR Exercises in Last Fiscal Year and Fiscal Year-End Option/SAR Values
Number of Common Shares Value of Unexercised
Underlying Unexercised In-The-Money
Options/SARs at Options/SARs at
Fiscal-Year-End (#) Fiscal-Year-End ($)(1)
---------------------------- -------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Jon M. Donnell 56,000 48,000 $146,000 $51,500
Robert A. Meyer, Jr. 38,000 9,500 $ 90,750 $21,750
</TABLE>
(1) The Value of Unexercised In-The-Money Options equals the difference between
the aggregate fair market value at December 31, 1999, of the Common Shares
underlying the options and the aggregate exercise price of the options.
[Footnotes continued from page 14]
(8) Share total does not include a nonqualified option to purchase 100,000
Common Shares of the Company which was granted to Mr. Donnell by BRC on
November 13, 1998. The option is exercisable commencing June 30, 2006, and
ending June 30, 2013 (the "Vesting Period"), provided (i) Mr. Donnell is
then employed by the Company; and (ii) the Company shall have achieved $100
million of shareholders' equity, excluding the proceeds of equity
offerings, as of the end of a fiscal quarter during the Vesting Period. The
option is subject to earlier vesting upon a "change in control" of the
Company, Mr. Donnell's termination "without cause," or his resignation with
"good reason," such terms having the same definitions as in the Employment
Agreement between Mr. Donnell and the Company.
(9) Includes reimbursement of payments by Mr. Donnell for initiation fee for
membership in a country club pursuant to an understanding between Mr.
Donnell and the Company at the time Mr. Donnell became employed by the
Company.
(10) Mr. Borror was paid base salary at an annual rate of $175,000 from January
1 through April 30, 1998. His base salary was increased to $200,000 per
year effective May 1, 1998. The reported base salary is the amount actually
paid to Mr. Borror in 1998.
-15-
<PAGE>
Director Compensation
Directors who are not employees of the Company receive fees of $2,500
per quarter and $1,000 per Board meeting and $500 per committee meeting
attended. Directors may defer the receipt of those fees and receive Company-
matching contributions with respect to those deferred fees through participation
in the Executive Deferred Compensation Plan. Additionally, under the Incentive
Stock Plan, each Director who is not, and has never been, an employee of, or
paid advisor or consultant to, the Company will receive, on the first business
day after each annual meeting of shareholders, provided that the Director
continues to serve on the Board on such date, a grant of a non-qualified stock
option to purchase 2,500 Common Shares at an exercise price equal to the fair
market value of the Common Shares on the date of grant. A Director option is
exercisable from the date of grant until the earlier of (i) the tenth
anniversary of the date of grant or (ii) generally three months (one year in the
case of a Director who becomes disabled or dies) after the date the Director
ceases to be a Director. The Company does not pay any separate remuneration to
employees of the Company who serve as Directors. Messrs. Klisares, Mayo and
Tilley were the Directors who were not employees of the Company in 1999.
Executive Deferred Compensation Plan
The Executive Deferred Compensation Plan permits executive officers and
Directors to elect to defer a portion of their annual compensation (20% of total
base and bonus for employees and 100% of Directors' fees). The Executive
Deferred Compensation Plan also provides for a matching contribution by the
Company for each participant equal to 25% of the amount deferred, but not to
exceed $2,500 in any year. The Company's matching contribution vests in 20%
increments over a five-year period. The contribution and match amounts are used
by the trustee of a rabbi trust to acquire Common Shares in the open market.
These Common Shares are held and voted by the trustee pursuant to the rabbi
trust agreement.
The following table sets forth information concerning the aggregate
deferral contributions by participating Directors and executive officers and
corresponding aggregate Company-matching contributions through December 31,
1999, expressed as the number of Common Shares held by the trustee as of such
date, with respect to each Director and executive officer participating in the
Plan.
<TABLE>
<CAPTION>
Deferral Vested Company- Unvested Company-
Contributions Matching Matching
Payable as Common Contributions Payable Contributions Payable
Shares as Common Shares as Common Shares Total
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Douglas G. Borror 10,975 1,605 1,109 13,689
David S. Borror 9,999 1,508 963 12,470
Pete A. Klisares 16,233 1,106 1,118 18,457
C. Ronald Tilley 9,513 490 964 10,967
Terry E. George 5,787 490 955 7,232
Jon M. Donnell 5,787 490 955 7,232
Robert A. Meyer, Jr 11,089 1,606 1,109 13,804
Peter J. O'Hanlon 2,525 49 580 3,154
</TABLE>
-16-
<PAGE>
Report of Compensation Committee
on Executive Compensation
and Share Price Performance Graph
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that might incorporate future
filings, including this Proxy Statement, in whole or in part, the following
"Report of Compensation Committee on Executive Compensation" and the information
under "Share Price Performance Graph" shall not be incorporated by reference
into any such filings.
REPORT OF COMPENSATION COMMITTEE
ON EXECUTIVE COMPENSATION
The Company has vested in the Compensation Committee (the "Committee")
of the Board of Directors the authority to determine and administer the
compensation program for the Company's executive officers and other key
employees. The Committee is composed of the Company's three outside, independent
Directors: Pete A. Klisares, Gerald E. Mayo and C. Ronald Tilley. Mr. Klisares
chairs the Committee. None of the members of the Committee had any of the
relationships during 1999 that required disclosure concerning "Compensation
Interlocks and Insider Participation."
Compensation Philosophy
The Company's executive compensation philosophy seeks to promote the
following key objectives:
o Align the interests of executive officers and other key
employees with the interests of shareholders by linking a
significant percentage of their total compensation to Company
financial performance.
o Reward individual contribution and achievement.
o Allow the Company to continue to attract and retain
outstanding executive officers and other key employees and to
compete with industry competitors and other businesses for
executive talent.
Implementation of this philosophy is an ongoing process, and the Committee
expects to continue to refine the Company's executive compensation as
appropriate to serve the objectives stated above.
There are two primary components to the Company's executive
compensation program: annual cash compensation and long-term incentive
compensation. Annual cash compensation consists of a base salary and an
incentive bonus. Long-term incentive compensation consists of stock options and
other awards under the Incentive Stock Plan and participation in the Split
Dollar Plan. The Company's executive compensation program also allows executives
to defer a portion of their compensation, and to augment the deferred amounts by
Company matches, through their optional participation in the Executive Deferred
Compensation Plan.
-17-
<PAGE>
It is the Company's objective to achieve continuous revenue and
earnings growth with a long-term objective of outperforming the homebuilding
industry in revenue growth and profitability. The Committee believes that, in
order to achieve this objective, the Company must be able to attract and retain
exceptional executive talent. Accordingly, the Committee's intent is that the
total cash and long-term incentive compensation received by the Company's
executive officers would place them in the upper range of the total cash and
long-term incentive compensation received by the executive officers of
homebuilding companies in general. In determining compensation for the Company's
executive officers, the Committee annually reviews a nationally-compiled
database of compensation by other homebuilding companies for various executive
positions, including data specific to public homebuilding companies,
homebuilding companies of a size comparable to the Company, and homebuilding
companies operating in the Midwest. For the most senior executive officers, the
Committee also considers the value of the Company's Common Shares as compared
with the value of homebuilding stocks in the market generally.
Annual Cash Compensation
Base Salary. The Committee recognizes that the homebuilding business is
cyclical and that the Company's financial performance depends, in large part, on
whether the homebuilding business is in a favorable or unfavorable cycle. The
Committee's intent is to set the base salaries of the Company's executive
officers at levels sufficient to attract and retain execeptional executive
talent in all business cycles.
In setting the base salary of an executive officer, the Committee
subjectively analyzes the executive's responsibilities, performance and value to
the Company, but gives no fixed weighting to any of such factors. The Committee
also considers market salary ranges for comparable positions. The Committee
reviews annually the base salary of each executive officer and makes adjustments
as warranted.
Incentive Bonus. The Committee believes that a significant portion of
the total compensation of the Company's executive officers should consist of
variable, performance-based components, such as awards of incentive bonuses and
grants of stock options, which the Committee can adjust to reflect changes in
Company and individual performance. These compensation components are intended
to reinforce the Company's commitment to increasing Company profitability and
shareholder value.
The Committee takes into account various quantitative measures and
qualitative indicators of Company and individual performance in determining the
level of incentive bonuses to be awarded to the Company's executive officers.
Although the Committee tends to give more weight to quantitative measures of
Company financial performance, it does not apply any specific formula. In making
such compensation decisions, the Committee recognizes and takes into account
that the homebuilding business is cyclical and that Company financial
performance can be greatly affected by factors, such as interest rates and
weather, that are beyond the control of the Company's executive officers. The
Committee considers such quantitative Company financial performance measures as
revenue growth, profitability, earnings per share and return on shareholders'
equity in determining the level of incentive bonuses. The Committee also
considers the Company's performance with respect to its customer satisfaction
ratings as a factor in determining incentive bonuses for all executive officers.
The Committee also understands the importance of individual
contributions and achievements that may be difficult to quantify and,
accordingly, recognizes qualitative indicators such as successful supervision of
major corporate projects, demonstrated leadership, the ability to respond to
difficult business cycles and achievement of specific, individual goal.
-18-
<PAGE>
Long-Term Incentive Compensation
Stock Options. On April 28, 1999, the Committee granted incentive stock
options covering an aggregate of 10,000 Common Shares to Karl E. Billisits, in
conjunction with his promotion to Senior Vice President of Land Acquisition and
Development. The options were granted at an exercise price of $7.50, which was
the fair market value of the Common Shares on the date of the grant. The options
vest in 20% increments on each of the first five anniversaries of the grant,
subject to acceleration of vesting in the event of a "change in control."
On May 1, 1999, the Committee granted incentive stock options covering
an aggregate of 20,000 Common Shares to Stephan M. George, as part of the
overall compensation package offered to Mr. George as the Company's new
Executive Vice President of Operations. The options were granted at an exercise
price of $8.00 per share, which was the fair market value of the Common Shares
on the date of the grant. The options vest in 20% increments on each of the
first five anniversaries of the grant, subject to acceleration of vesting in the
event of a "change in control."
On October 27, 1999, the Committee granted incentive stock options
covering an aggregate of 10,000 Common Shares to Jay York, as part of the
overall compensation package offered to Mr. York as the Company's new Director
of Special Projects. The options were granted at an exercise price of $5.66 per
share, which was the fair market value of the Common Shares on the date of the
grant. The options vest in equal 1/3 increments on the third, fourth and fifth
anniversaries of the grant, subject to acceleration of vesting in the event of a
"change in control."
On November 2, 1999, the Committee granted incentive stock options
covering an aggregate of 20,000 Common Shares to Robert D. Beck, Jr., as part of
the overall compensation package offered to Mr. Beck as the Company's new Senior
Vice President of Sales. The options were granted at an exercise price of $6.00
per share, which was the fair market value of the Common Shares on the date of
the grant. The options vest in 20% increments on each of the first five
anniversaries of the grant, subject to acceleration of vesting in the event of a
"change in control."
The Committee intends on a periodic basis to make grants under the
Incentive Stock Plan to the Company's executive officers and other key
employees. In making such grants, the Committee will consider the subjective
factors identified above, as well as the number of options granted in prior
years.
Restricted Stock Grants. On May 1, 1999, the Committee awarded to
Stephan M. George 12,000 restricted Common Shares, as part of the overall
compensation package offered to Mr. George as the Company's new Executive Vice
President of Operations. The restrictions provide for forfeiture if Mr. George's
employment with the Company is terminated prior to May 1, 2002. The restrictions
will lapse as to 4,000 shares each at May 1, 2000, May 1, 2001, and May 1, 2002,
respectively, provided that Mr. George is then employed by the Company, and
subject to acceleration of the lapse of restrictions in the event of a "change
in control."
On November 2, 1999, the Committee awarded to Robert D. Beck, Jr.
12,000 restricted Common Shares, as part of the overall compensation package
offered to Mr. Beck as the Company's new Senior Vice President of Sales. The
restrictions provide for forfeiture if Mr. Beck's employment with the Company is
terminated prior to October 27, 2002. The restrictions will lapse as to 4,000
shares each at October 27, 2000, October 27, 2001, and October 27, 2002,
respectively, provided that Mr. Beck is then employed by the Company, and
subject to acceleration of the lapse of restrictions in the event of a "change
in control."
-19-
<PAGE>
Split Dollar Plan. After careful consideration, the Committee proposed,
and the Board of Directors approved, effective January 1, 1999, the Split Dollar
Plan, in which certain key employees of the Company, including all Named
Executive Officers other than Donald A. Borror, are participants. The purpose of
the Split Dollar Plan is to provide additional incentive for participating
employees to remain with the Company and contribute to its success. Under the
Split Dollar Plan, participating employees are provided with a death benefit
during employment, together with a retirement benefit upon retirement at or
after age 55 (or, if sooner, upon a "change in control" of the Company),
provided the employee shall have then completed ten years of service with the
Company following implementation of the Split Dollar Plan, the Company shall
have attained adjusted shareholders' equity of $100 million, and the employee
shall have complied with the provisions of the noncompetition covenant for one
year following retirement. "Change in control" is defined as an event which
results in either BRC failing to own at 30% of the combined voting power of the
outstanding voting securities of the Company, or both Donald Borror and Douglas
Borror ceasing to be Directors and officers of the Company. "Adjusted
shareholders' equity" is defined to exclude the proceeds of any sale by the
Company of equity securities and to include the fair value of any dividends or
distributions made by the Company after the effective date of the Split Dollar
Plan. Each participating employee has entered into agreements with the Company
under which the employee's rights under each split dollar policy are assigned to
the Company. Each participating employee is required to pay a portion of the
policy premiums; the remainder of the premiums are paid by the Company. In the
event a participating employee terminates employment prior to either completing
ten years of service or the Company's attaining adjusted shareholders' equity of
$100 million dollars, the employee's employment is terminated by the Company for
"cause" at any time prior to payment of the retirement benefit, or the employee
violates the terms of the noncompetition covenant, the then accumulated cash
value in the policy will be retained by the Company. In the event the employee
dies prior to the vesting of retirement benefits, all premiums paid by the
Company will be repaid to the Company prior to the payment of any death benefit
to the employee's beneficiary under the policy.
Chief Executive Officer Compensation
In accordance with the executive compensation philosophy and program
described above, the Committee awarded Douglas G. Borror a cash incentive bonus
of $550,000 in 1999, which represented no increase over the cash bonus awarded
to Mr. Borror in 1998. In late 1998, the Committee approved an increase in Mr.
Borror's annual base salary for 1999 from $400,000 to $440,000. Mr. Borror did
not receive an award of stock options in 1999.
Tax Aspects
Section 162(m) of the Internal Revenue Code of 1986, as amended,
prohibits the deduction by a publicly-held corporation of compensation paid to a
"covered employee" in excess of $1.0 million per year, subject to certain
exceptions. Generally, the Company's covered employees are those executive
officers listed under the Summary Compensation Table set forth above.
Compensation paid to Douglas Borror in 1999 is estimated to have exceeded the
$1.0 million deductibility limit of Section 162(m) by approximately $15,000.
This amount is not covered by any of the exceptions to Section 162(m), and thus
is not deductible by the Company. The Company anticipates that in 2000 Mr.
Borror's total compensation will exceed the $1.0 million deductibility limit of
Section 162(m), but does not anticipate that Section 162(m) will limit the
deductibility of compensation paid to any other executive officer. As indicated
above, Section 162(m) provides exceptions to the $1.0 million limitation on the
deductibility of executive compensation. The
-20-
<PAGE>
Committee has not attempted to revise the Company's executive compensation
program to satisfy the conditions to these exceptions but may in the future
consider doing so.
Members of the Compensation Committee
Pete A. Klisares Gerald E. Mayo
C. Ronald Tilley
-21-
<PAGE>
SHARE PRICE PERFORMANCE GRAPH
The following graph compares the cumulative total shareholder return on
the Common Shares from December 31, 1994, until December 31, 1999, with the
cumulative total return of (a) the NASDAQ-OTC Index Composite and (b) the
Standard and Poor's Homebuilding Index. The graph assumes the investment on
December 31, 1994, of $100 in the Common Shares, the NASDAQ-OTC Index Composite
and the Standard and Poor's Homebuilding Index.
[GRAPHIC-- GRAPH PLOTTED POINTS LISTED BELOW]
<TABLE>
<CAPTION>
December 31, December 31, December 31, December 31, December 31, December 31,
1994 1995 1996 1997 1998 1999
<S> <C> <C> <C> <C> <C>
600
500
400
200
100
0
</TABLE>
-22-
<PAGE>
CERTAIN RELATIONSHIPS AND CERTAIN TRANSACTIONS
Description and Ownership of BRC
BRC, which owns approximately 65.2% of the Company's outstanding Common
Shares, is in the business of owning and managing multifamily housing and
commercial real estate. Donald A. Borror, Douglas G. Borror, and David S.
Borror, who are Directors and executive officers of the Company, and Terry E.
George, who is an executive officer of the Company, also are Directors of BRC.
Mr. George also serves as a Vice President of BRC.
BRC has issued and outstanding 105,065 voting common shares and 273,195
nonvoting common shares, all of which are beneficially owned by members of the
Borror family, or trusts for their benefit, and by Terry George. BRC holds
42,000 nonvoting shares of BRC as treasury shares. Through their ownership and
control of BRC, such persons are in a position to control the Company. See
"Security Ownership of Certain Beneficial Owners and Management."
On November 13, 1998, the Amended and Restated Borror Corporation Stock
Trust, a revocable trust established by Donald Borror pursuant to a trust
agreement dated January 4, 1994 (the "Stock Trust"), gifted 4,410 voting shares
of BRC to each of Douglas Borror and David Borror and gifted 4,520 nonvoting
shares of BRC to Douglas Borror, 10,580 nonvoting shares of BRC to David Borror
and 18,080 nonvoting shares of BRC to the 1987 Irrevocable Subchapter S Trust,
an irrevocable trust established by Donald Borror pursuant to a trust agreement
dated June 26, 1987 (the "Irrevocable Trust"). As of such date, BRC also
redeemed 42,000 nonvoting shares of BRC held by the Stock Trust. The gifts and
redemption were effected as part of Donald Borror's estate planning and to help
ensure an orderly succession of ownership of BRC at the time of Donald Borror's
death.
The Stock Trust owns 43,180 voting common shares of BRC, representing
41.10% of the issued and outstanding voting common shares of BRC, and does not
own any of the nonvoting common shares of BRC. The Stock Trust will expire upon
the ten year anniversary of Donald Borror's death or upon the death of Joanne
Borror (Donald Borror's wife), whichever is later. Joanne Borror is the
beneficiary of the Stock Trust until her death (unless she predeceases Donald
Borror) and each of Donald and Joanne Borror's children (Douglas and David
Borror and Donna Myers) are one-third remainder beneficiaries of the Stock
Trust. Donald Borror and Douglas Borror are the joint trustees of the Stock
Trust until the death or incapacity of either of them, whereupon the other of
them will become sole trustee.
Douglas Borror owns 37,275 voting common shares of BRC, representing
35.48% of the issued and outstanding voting common shares of BRC, and 112,875
nonvoting common shares of BRC, representing 41.32% of the issued and
outstanding non-voting common shares of BRC.
David Borror owns 19,610 voting common shares of BRC, representing
18.66% of the issued and outstanding voting common shares of BRC, and 76,180
nonvoting common shares of BRC, representing 27.88% of the issued and
outstanding non-voting common shares of BRC.
The Irrevocable Trust owns 68,080 nonvoting common shares of BRC,
representing 24.92% of the issued and outstanding nonvoting common shares of
BRC. David Borror is the trustee of the Irrevocable Trust and Donna Myers
(Donald and Joanne Borror's daughter and Douglas and David Borror's sister) is
the sole beneficiary of the Irrevocable Trust. The Irrevocable Trust expires
upon the death of Donald Borror.
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Terry George owns 5,000 voting common shares of BRC, representing 4.76%
of the issued and outstanding voting common shares of BRC, and 16,060 non-voting
common shares of BRC, representing 5.88% of the issued and outstanding
non-voting common shares of BRC.
BRC and the shareholders of BRC are parties to a Close Corporation
Agreement dated January 4, 1994 ("BRC Agreement"). The BRC Agreement contains
certain provisions related to BRC's status as an S Corporation (including
mandatory distributions to BRC shareholders equal to the product of the maximum
marginal individual income tax rate and the shareholder's pro rata share of the
taxable income attributable to BRC). The BRC Agreement provides that all of the
voting power of the BRC shares is to be exercised by a majority of the Directors
of BRC, all of whom will be elected by Donald Borror and Douglas Borror jointly
until the death or incapacity of either of them and, thereafter, by the other of
them solely. Under the provisions of the BRC Agreement, David Borror is required
to be elected as a Director of BRC as long as he continues to hold at least 10%
of the shares of BRC, absent his removal for "cause" (as defined therein). In
such circumstances and as long as BRC has the ability to elect at least two
Directors of the Company, BRC also is required to use its best efforts to elect
David Borror as a Director of the Company. The BRC Agreement generally restricts
the transfer of shares of BRC to persons other than members of the Borror family
unless certain procedures are followed. BRC is required to repurchase all of
Terry George's shares in the event of his death or incapacity and has the right
to purchase Terry George's shares at any time. BRC also is required to purchase
a certain number of shares from the estates of Borror family members. Subject to
certain conditions, Borror family members have the right to require BRC to
repurchase shares from them. In certain instances, the obligation of BRC to
repurchase shares may be assumed by Borror family shareholders.
Transactions with BRC
The Board of Directors of the Company has established the Affiliated
Transactions Review Committee for the purpose of reviewing any material
transactions with affiliates or related parties of the Company, including BRC,
for consistency with the Company's policies concerning affiliated transactions.
The Affiliated Transactions Review Committee is comprised of the Company's three
outside, independent Directors: Pete A. Klisares, Gerald E. Mayo and C. Ronald
Tilley, and is chaired by Mr. Klisares.
The Company leases its corporate headquarters from BRC. The primary
lease continues until December 31, 2009, at a rental rate of $12.00 per square
foot on a total net basis with two options to renew for periods of five years
each at then-current market rates. The rental rate was established by an MAI
appraisal commissioned by the Affiliated Transactions Review Committee, and
confirmed in a review for the Affiliated transactions Review Committee by a
second MAI appraiser. The Company paid to BRC $451,000 under this lease during
1999.
The Company leases its 4,200 square foot decorating center from BRC.
The lease continues until December 31, 2003, and the rental rate is $10.00 per
square foot in 1999, $10.50 per square foot in 2000, and $11.00 per square foot
in each of the last three years. The rental rates were confirmed by an MAI
appraisal commissioned by the Affiliated Transaction Review Committee to be
consistent with comparable rental rates in the area and, in the first two years,
slightly below market rates.
At its July 21, 1999, meeting, the Affiliated Transactions Review
Committee reviewed and approved two agreements to lease additional space in the
same shopping center as the Company's decorating center. The agreements provided
the Company with additional space for new customer operations, including a new
home sales and training center. The agreements cover two separate adjacent
spaces, one 1,200 square feet and one 2,700 square feet. The
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agreement for the 1,200 square foot space is an assignment agreement under which
the Company assumed obligations under an existing lease with a former tenant.
The remaining term under the lease is three years and six months, and the lease
rates are $10.50 per square foot for the remainder of the first year and $11.50,
$12.00 and $12.50 per square foot during the second, third and fourth remaining
full years. The agreement for the 2,700 square foot space is also an assignment
of an existing lease with a former tenant that had been renewed for a five-year
term. The agreement provides for lease rates that begin at $11.00 per square
foot for the first three years and rise to $11.50 per square foot in the final
two years. The lease rates were confirmed to be reflective of current market
conditions by a report prepared for the Affiliated Transaction Review Committee
by an MAI appraiser.
In a unanimous written action taken as of September 27, 1999, without a
meeting, the Affiliated Transactions Review Committee approved a lease agreement
for an additional 1,350 square feet in the shopping center in which the
Company's decorating center is located. The Company has established a
preconstruction conference center in the space in which all preconstruction
conferences with its customers are conducted. The lease agreement provides for a
term of five years and lease rates of $10.50 per square foot the first year,
$11.00 per square foot the second, third and fourth years, and $11.50 per square
foot the fifth year. The lease rates were confirmed in a report by an MAI
appraiser to be consistent with fair market rates for comparable space.
In a unanimous written action taken as of February 15, 2000, without a
meeting, the Affiliated Transactions Review Committee approved a lease agreement
for an additional 1,768 square feet in the shopping center in which the
decorating center is located. The Company has established its new mortgage
finance operation in the space. The lease agreement provides for a term of three
years commencing March 1, 2000, and provides for lease rates of $10.50 per
square foot in the first year and $11.00 per square foot in each of the final
two years of the lease term. The base rates were confirmed by a report prepared
by an MAI appraiser to be consistent with market rates.
The Company paid to BRC an aggregate of $70,000 under leases for space
in the shopping center during 1999. The Company believes that the terms of these
leases were no less favorable to the Company than those reasonably available
from unrelated third parties for comparable space.
Occasionally, employees of the Company provide limited administrative
services to BRC, for which the Company receives fees. The Company received
aggregate fees of $25,000 from BRC for such administrative services in 1999.
The Company and BRC are parties to a Shareholder Agreement (the
"Shareholder Agreement"), dated January 20, 1994, pursuant to which BRC has the
right, from time to time, to demand that the Company register for sale Common
Shares owned by BRC. Each request by BRC for a demand registration must cover at
least 10% of the Common Shares owned by BRC and at least 5% of the Company's
then outstanding Common Shares. Without the Company's consent (exercised by a
majority of its independent Directors), the Company is not obligated to cause a
demand registration to be effected within 18 months after the consummation of a
prior demand registration. BRC and the Company will each pay one-half of the
expenses of each demand registration. BRC also will have incidental, or
piggy-back, registration rights if the Company proposes to register any of its
equity securities (other than registrations involving employee benefit plans)
for its own account or for the account of any other shareholder. BRC will pay
all of its own legal expenses and the first $25,000 of the other expenses of a
piggy-back registration and the Company will pay the remaining expenses of a
piggy-back registration. Both the demand and piggy-back registration rights will
be subject to customary underwriting and holdback provisions and will expire on
March 9, 2004.
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Transactions with Printing Plus, Inc.
Donald A. Borror, Chairman Emeritus of the Company, together with
Richard Myers, own Printing Plus, Inc., a printing company which has provided
printing services to the Company. Mr. Myers, who also operates Printing Plus,
Inc., is the husband of Donna Borror Myers, who is Donald A. Borror's daughter
and Douglas G. and David S. Borror's sister. In 1999, the Company paid $80,000
to Printing Plus, Inc. for printing services, which amount represented
approximately 27% of the total amount paid by the Company for printing services
in 1999. All of the printing services provided to the Company by Printing Plus,
Inc. in 1999 were pursuant to contracts that had been competitively bid. The
transactions between the Company and Printing Plus, Inc. were not reviewed or
approved by the Affiliated Transactions Review Committee or the Audit Committee
of the Board of Directors.
AMENDMENT TO THE CODE OF REGULATIONS
TO PERMIT VOTING BY ELECTRONIC, TELEPHONIC
AND OTHER TYPES OF PROXIES
The Board recommends that the shareholders approve a resolution to
amend Section 1.10 of Article One of the Code of Regulations to permit voting by
electronic, telephonic and other types of proxies. Section 1.10 of Article One
of the Code of Regulations permits a shareholder to vote by proxy, if the proxy
is in writing and executed by the shareholder. The Ohio General Corporation Law
recently was amended to expand the methods a shareholder could use to grant a
proxy. The Ohio General Corporation Law now permits a shareholder to grant a
proxy by any verifiable communication authorized by the person granting the
proxy. Any transmission that creates a record capable of authentication that
appears to have been transmitted by the person granting a proxy is permitted,
and would include electronic mail and telephone, as well as traditional written
proxies. The Code of Regulations currently does not provide for a shareholder to
grant a proxy by electronic mail, telephone and other electronic media. The
amendment to the Code of Regulations would expressly authorize the shareholders
to utilize the more modern forms of proxy voting now permitted by the Ohio
General Corporation law.
At a meeting held on January 25, 2000, the Board approved, and
recommended that the shareholders of the Company adopt, an amendment to Section
1.10 of Article One of the Code of Regulations to permit a shareholder to use
electronic, telephonic and other methods to grant a proxy. The proposed
amendment to the Code of Regulations would provide that a shareholder could
grant a proxy by any method authorized by Ohio law.
Proposal
Shareholders are requested to approve the following resolution to amend
the Code of Regulations:
RESOLVED, that Section 1.10 of Article One of the Amended and
Restated Code of Regulations of the Company be, and hereby is, amended
to read in its entirety as follows:
Section 1.10. Proxies. At meetings of the shareholders any
shareholder of record entitled to vote thereat may be represented and
may vote by a proxy or proxies appointed by an instrument in writing
signed by such shareholder or appointed in any other manner permitted
by Ohio law. Such instrument in writing or record of any such
appointment shall be filed with the secretary of the meeting before the
person holding such proxy shall be allowed to vote thereunder. No proxy
shall
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be valid after the expiration of eleven months after the date of its
execution, unless the shareholder executing it shall have specified
therein the length of time it is to continue in force.
Recommendation and Vote
Approval of the amendment to the Code of Regulations to permit voting
by electronic, telephonic and other types of proxies will require the
affirmative vote of the majority of the Common Shares issued and outstanding as
of the record date.
The Board recommends that shareholders vote "FOR" approval of the
adoption of the amendment to the Code of Regulations to permit voting by
electronic, telephonic and other types of proxies.
AMENDMENT TO THE CODE OF REGULATIONS TO
REDUCE THE MINIMUM NUMBER OF DIRECTORS
COMPRISING A COMMITTEE OF THE BOARD
FROM THREE TO ONE
The Board recommends that the shareholders approve a resolution to
amend Section 2.10 of Article Two of the Code of Regulations to reduce the
minimum number of Directors comprising a committee of the Board of Directors
from three to one. Section 2.10 of Article Two of the Code of Regulations
provides that any committee of the Board of Directors must be comprised of at
least three members. The Ohio General Corporation Law recently was amended to
permit a committee of a board of directors to be comprised of a single member.
The amendment to the Code of Regulations would permit the Board of Directors,
absent any supervening requirements relating to the composition of board
committees, to establish committees having only one member. The Board of
Directors believes that the amendment to the Code of Regulations would provide
the Board of Directors appropriate flexibility regarding the establishment of
committees consistent with Ohio law.
At a meeting held on January 25, 2000, the Board of Directors of the
Company approved, and recommended that the shareholders of the Company adopt, an
amendment to Section 2.10 of Article Two of the Code of Regulations to permit
the Board of Directors to establish committees having only one member.
Proposal
Shareholders are requested to approve the following resolution
to amend the Code of Regulations:
RESOLVED, that the first paragraph of Section 2.10 of Article
Two of the Amended and Restated Code of Regulations be, and hereby is,
amended to read in its entirety as follows:
Section 2.10. Committee. The Directors may create one or more
committees of the Directors, including an executive committee, each
consisting of one or more Directors, and may authorize the delegation
to any such committee of any of the authority of the Directors, however
conferred, other than that of filling vacancies among the Directors or
in any committee of the Directors.
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Recommendation and Vote
Approval of the amendment of the Company's Code of Regulations to
reduce the minimum number of Directors comprising a committee of the Board of
Directors from three to one will require the affirmative vote of the majority of
the Common Shares issued and outstanding as of the record date.
The Board recommends that shareholders vote "FOR" the approval of the
adoption of the amendment to the Company's Code of Regulations to reduce the
minimum number of Directors comprising a committee of the Board of Directors
from three to one.
SELECTION OF AUDITORS
The Board has selected PricewaterhouseCoopers LLP, certified public
accountants, as independent auditors for the Company for the year ending
December 31, 2000. PricewaterhouseCoopers LLP and its predecessors have audited
the books of the Company and its predecessors since 1964. Management expects
that a representative of PricewaterhouseCoopers LLP will be present at the
Annual Meeting, will have the opportunity to make a statement if he or she so
desires and will be available to respond to appropriate questions.
Recommendation and Vote
Ratification of the selection of PricewaterhouseCoopers LLP as the
Company's independent auditors for 2000 will require the affirmative vote of a
majority of the Common Shares issued and outstanding as of the record date.
The Board recommends that shareholders vote "FOR" ratification of the
selection of PricewaterhouseCoopers LLP as the Company's independent auditors
for 2000.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under the federal securities laws, the Company is required to report in
this Proxy Statement any known failures during the 1999 fiscal year by executive
officers, Directors or 10% shareholders to file on a timely basis a Form 3, 4 or
5, relating to the beneficial ownership of the Common Shares. To the best of the
Company's knowledge after a review of such filings, all such required forms were
filed on a timely basis.
PROPOSALS BY SHAREHOLDERS FOR 2001 MEETING
In order to be eligible to submit a proposal to be included in next
year's Proxy Statement and acted upon at the annual meeting of the shareholders
of the Company to be held in 2001 (the "2001 Annual Meeting"), a shareholder
must have continuously held at least $2,000 in market value, or 1%, of the
issued and outstanding Common Shares, for at least one year by the date on which
the proposal is submitted. In addition, the shareholder must continue to hold
the requisite number of Common Shares through the date of the 2001 Annual
Meeting. Any such proposal must be received by the Company prior to the close of
business on November 28, 2000. Each proposal submitted should be accompanied by
the name and address of the shareholder submitting the proposal and
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a statement that the shareholder intends to continue to hold the requisite
number of Common Shares through the date of the 2001 Annual Meeting. If the
proponent is not a shareholder of record, proof of beneficial ownership of the
requisite number of Common Shares also should be submitted. The proponent should
also state his or her intention to appear in person or by a qualified
representative at the 2001 Annual Meeting to present the proposal. The proxy
rules of the Securities and Exchange Commission govern the content and form of
shareholder proposals. All proposals must be a proper subject for action at the
2001 Annual Meeting.
The Company will not be required to include in its Proxy Statement for
the 2001 Annual Meeting any proposal submitted outside of the procedures set
forth in the immediately preceding paragraph. The Company also may confer on the
proxies' discretionary authority to vote on any such proposal, if it does not
receive notice of such proposal by February 10, 2001.
The procedures for shareholders to make nominations for Class I
Directors to be elected at the Annual Meeting of Shareholders of the Company to
be held in 2001 are set forth above under "Board of Directors and Management --
Nomination of Directors."
ADDITIONAL INFORMATION
Upon the written request of a person who was the beneficial owner of
Common Shares as of March 17, 2000 (the record date for notice and the right to
vote at the Annual Meeting), the Company will provide (without charge and upon
written request) a copy of the Company's Annual Report on Form 10-K, excluding
exhibits, for the fiscal year ended December 31, 1999. The written request for
an Annual Report should be directed to Investor Relations Department, Dominion
Homes, Inc., 5501 Frantz Road, P. O. Box 7166, Dublin, Ohio 43017-0766. The
written request must include a statement that, as of March 17, 2000, the person
was a beneficial owner of Common Shares.
PROXY CARD TO FOLLOW ONCE COMPLETED BY TYPESETTING
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DOMINION HOMES, INC.
Proxy for the Annual Meeting of Shareholders to be held on April 26, 2000
This Proxy is solicited on behalf of the Board of Directors
The undersigned holder(s) of common shares, no par value ("Common
Shares"), of Dominion Homes, Inc. ("Company") hereby constitute(s) and
appoint(s) David S. Borror and Terry E. George, or either of them, the Proxy or
Proxies of the undersigned, with full power of substitution, to attend the
Annual Meeting of Shareholders ("Annual Meeting") of the Company to be held on
April 26, 2000, at The Dominion Home Store, 5767 Karric Square Drive, Dublin,
Ohio, at 10:00 a.m., local time, and any adjournment or adjournments thereof,
and to vote all of the Common Shares which the undersigned is entitled to vote
at such Annual Meeting or at any adjournments thereof:
1. |_| FOR election as Directors |_| WITHHOLD AUTHORITY to vote for
of the Company all the all nominees listed below
nominees listed below
(except as marked to the
contrary below).*
Donald A. Borror David S. Borror Pete A. Klisares Gerald E. Mayo
*(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE
A LINE THROUGH THE NAME OF THE NOMINEE IN THE LIST ABOVE.)
2. |_| FOR |_| AGAINST |_| ABSTAIN
Amendment of the Company's Amended and Restated Code of Regulations to
permit voting by electronic, telephonic and other types of proxies.
3. |_| FOR |_| AGAINST |_| ABSTAIN
Amendment of the Amended and Restated Code of Regulations to reduce the
minimum number of Directors comprising a committee of the Board of Directors
from three to one.
4. |_| FOR |_| AGAINST |_| ABSTAIN
Ratification of the selection of PricewaterhouseCoopers LLP as
independent public accountants for the Company in 2000.
5. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting or any postponements or
adjournments thereof.
(Continued, and to be signed, on other side)
<PAGE>
(Continued from other side)
WHERE A CHOICE IS INDICATED, THE SHARES REPRESENTED BY THIS PROXY WILL
BE VOTED OR NOT VOTED AS SPECIFIED. WHERE NO CHOICE IS INDICATED, THE SHARES
REPRESENTED BY THIS PROXY WILL BE VOTED "FOR" THE ELECTION OF THE NOMINEES
LISTED IN ITEM NO. 1 AS DIRECTORS OF THE COMPANY, "FOR" AMENDMENT OF THE
COMPANY'S AMENDED AND RESTATED CODE OF REGULATIONS TO PERMIT VOTING BY
ELECTRONIC, TELEPHONIC AND OTHER TYPES OF PROXIES, "FOR" AMENDMENT OF THE
AMENDED AND RESTATED CODE OF REGULATIONS TO REDUCE THE MINIMUM NUMBER OF
DIRECTORS COMPRISING A COMMITTEE OF THE BOARD OF DIRECTORS FROM THREE TO ONE,
"FOR" RATIFICATION OF THE SELECTION OF PRICEWATERHOUSECOOPERS LLP AS THE
INDEPENDENT PUBLIC ACCOUNTANTS FOR THE COMPANY IN 2000, AND, IN THE DISCRETION
OF THE PROXY OR PROXIES, ON ANY OTHER BUSINESS PROPERLY BROUGHT BEFORE THE
MEETING OR ANY POSTPONEMENT(S) OR ADJOURNMENT(S) THEREOF.
All proxies previously given by the undersigned are hereby revoked. The
undersigned acknowledges receipt of the accompanying Notice of Annual Meeting of
Shareholders and Proxy Statement for the April 26, 2000, Annual Meeting.
Dated: ________________, 2000 __________________________________________
Signature of Shareholder(s)
Dated: ________________, 2000 __________________________________________
Signature of Shareholder(s)
Please sign exactly as your name appears
hereon. Executors, administrators,
trustees, guardians, attorneys and agents
should give their full titles. If
shareholder is a corporation, sign in
full corporate name by authorized
officer. If shares are registered in two
names, both shareholders should sign.
(Please note any change of address on
this proxy.)
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF DOMINION HOMES,
INC. PLEASE FILL IN, DATE, SIGN AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
