<PAGE>
<PAGE>
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
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 / / Confidential, for Use of the
/X/ Definitive Proxy Statement Commission Only (as permitted
/ / Definitive Additional Materials by Rule 14a-6(e)(2))
/ / Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
MAIL-WELL, 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)(1) 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>
<PAGE>
MAIL-WELL, INC.
[MAIL-WELL 23 INVERNESS WAY EAST
LOGO] ENGLEWOOD, COLORADO 80112
(303) 790-8023
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 5, 1999
TO THE STOCKHOLDERS OF MAIL-WELL, INC.:
Notice is hereby given that the Annual Meeting of Stockholders
of Mail-Well, Inc., a Colorado corporation (the "Company"), will be
held on Wednesday, May 5, 1999, at 8:30 a.m. at the Hyatt Regency
Tech Center, 7800 Tufts Avenue, Denver, Colorado, for the following
purposes:
1. To elect seven directors of the Company to hold office until
the 2000 Annual Meeting of Stockholders or until their respective
successors are duly elected and qualified;
2. To ratify the selection of Ernst & Young LLP, independent
auditors, as auditors of the Company for the year ending December
31, 1999; and
3. To transact such other business as may properly come before
the meeting or any adjournments thereof.
The names of the nominees for directors are set forth in the
accompanying Proxy Statement.
The Board of Directors has fixed the close of business on March
12, 1999, as the record date for the determination of stockholders
entitled to receive notice of and to vote at the Annual Meeting or
any adjournments thereof.
A copy of the Company's 1998 Annual Report to Stockholders,
which includes the Company's consolidated financial statements, was
mailed with this Notice on or about March 22, 1999, to all
stockholders of record on the record date. The Company's Annual
Report on Form 10-K to the Securities and Exchange Commission may be
obtained without charge upon written request directed to the
Secretary of the Company at the address above. The officers and
directors of the Company cordially invite you to attend the Annual
Meeting.
Whether or not you expect to attend the Annual Meeting, you
should complete, date and sign the enclosed proxy card and mail it
promptly in the enclosed postage prepaid envelope. The proxy card
must be signed and returned in order to be counted.
By Order of the Board of Directors,
/s/ Roger Wertheimer
Roger Wertheimer
Vice President-General Counsel and
Secretary
Englewood, Colorado
March 22, 1999
<PAGE>
<PAGE>
MAIL-WELL, INC.
23 INVERNESS WAY EAST
ENGLEWOOD, COLORADO 80112
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 5, 1999
INTRODUCTION
This Proxy Statement is furnished to the stockholders of
Mail-Well, Inc., a Colorado corporation (the "Company"), in
connection with the solicitation of proxies to be used in voting at
the Annual Meeting of Stockholders to be held on Wednesday, May 5,
1999. The enclosed proxy is solicited by the Board of Directors of
the Company. The proxy materials were mailed on or about March 22,
1999, to the stockholders of record at the close of business on
March 12, 1999 (the "Record Date").
The Company will bear the cost of the solicitation of proxies,
including the charges and expenses of brokerage firms and others who
forward solicitation material to beneficial owners of the Company's
Common Stock. In addition to the use of the mail, proxies may be
solicited by personal interview, telephone or telegraph by certain
employees of the Company. The Company will bear any costs relating
to such solicitations by Company personnel. The Company has arranged
for American Securities Transfer, Inc. to serve as its agent to
coordinate and oversee the return of proxy cards.
VOTING RIGHTS AND OUTSTANDING SHARES
Only holders of record of Common Stock at the close of business
on the Record Date will be entitled to vote at the Annual Meeting.
On the Record Date, there were 48,876,259 shares of Common Stock
outstanding. Each share of Common Stock is entitled to one vote on
all matters on which stockholders may vote. There is no cumulative
voting in the election of directors.
Votes cast by proxy or in person at the Annual Meeting will be
tabulated by the inspectors of election appointed for the meeting
and will determine whether or not a quorum is present. The holders
of a majority of the outstanding Common Stock are required for a
quorum at the Annual Meeting. The inspectors of election will treat
abstentions as shares that are present and entitled to vote for
purposes of determining the presence of a quorum, but as unvoted for
purposes of determining the approval of any matter submitted to the
stockholders for a vote. If a broker indicates on the proxy that it
does not have discretionary authority as to certain shares to vote
on a particular matter, those shares will not be considered as
present and entitled to vote with respect to that matter.
REVOCABILITY OF PROXIES
Any person giving a proxy pursuant to this solicitation has the
power to revoke it at any time before it is exercised. It may be
revoked by (1) filing a written notice of revocation with the
Secretary of the Company at the Company's principal executive
offices, 23 Inverness Way East, Suite 160, Englewood, Colorado
80112, (2) duly executing and delivering a proxy bearing a later
date, or (3) attending the Annual Meeting and voting in person.
Attendance at the Annual Meeting will not, by itself, revoke a
proxy.
<PAGE>
<PAGE>
SUMMARY OF PROPOSALS
Stockholders will be asked to vote upon the following proposals
at the Annual Meeting:
1. Election of the following seven persons to the Board of
Directors: Gerald F. Mahoney, Paul V. Reilly, Frank P. Diassi, Frank
J. Hevrdejs, Janice C. Peters, Jerome W. Pickholz and William R.
Thomas.
2. Ratification of the selection of Ernst & Young LLP as
independent auditors for the Company for 1999.
The proxies will be voted, unless authority to do so is
withheld, to elect the seven nominees recommended by the Board, and
to ratify the selection of Ernst & Young LLP as the Company's
auditors for 1999.
INFORMATION CONCERNING DIRECTORS AND NOMINEES
The names, ages (as of December 31, 1998), positions with the
Company and the business experience over the past five years of each
of the Board nominees is set forth below. Each director has served
continuously with the Company since the date indicated below, except
for Ms. Peters who, if elected, will be a new addition to the Board.
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE POSITION(S) SINCE
- ---- --- ----------- --------
<S> <C> <C> <C>
Gerald F. Mahoney <F1> 55 Director, Chairman of the Board and Chief 1994
Executive Officer
Paul V. Reilly 46 Director, President and Chief Operating 1998
Officer
Frank P. Diassi <F2> 65 Director 1993
Frank J. Hevrdejs <F2> 53 Director 1993
Janice C. Peters 47 Director --
Jerome W. Pickholz <F1><F3> 66 Director 1994
William R. Thomas <F3> 70 Director 1998
<FN>
- ----------------------------
<F1> Member of the Nominating Committee.
<F2> Member of the Compensation Committee.
<F3> Member of the Audit Committee.
</TABLE>
GERALD F. MAHONEY has been a director, Chairman of the Board and
Chief Executive Officer of the Company since February 1994. He was
Chairman of the Board, President and Chief Executive Officer of
Pavey Envelope & Tag Corp. from January 1991 until it became a
subsidiary of the Company in February 1994. From September 1987 to
September 1989, Mr. Mahoney served as President of Transkrit Corp.,
a business forms manufacturing company. Mr. Mahoney has served as a
director of Pentegra Dental Group, Inc., a dental practice
management company, since March 1998. He devotes substantially all
of his time to the Company in his capacity as Chairman and CEO. Mr.
Mahoney serves as Chairman of the Nominating Committee of the Board
of Directors.
PAUL V. REILLY has been a director, President and Chief
Operating Officer of the Company since January 1998. Prior to that,
Mr. Reilly served as Senior Vice President--Finance and Chief
Financial Officer of the Company since September 1995. Mr. Reilly
spent 14 years with Polychrome Corporation, a prepress supplier to
the printing industry, where he held a number of positions including
Assistant Corporate Treasurer, Corporate Treasurer, Vice President
and Chief Financial Officer, and General Manager of United States
Operations. During 1994 and 1995, Mr. Reilly worked with Saddle River
2
<PAGE>
<PAGE>
Capital, an investment banking firm which purchased and managed small
businesses, and as Vice President with a direct marketer of educational
materials. Mr. Reilly is a Certified Public Accountant.
FRANK P. DIASSI has been a director of the Company since its
inception in November 1993. Mr. Diasi has been Chairman of Sterling
Chemicals, Inc., a manufacturer of commodity chemicals, pulp
chemicals, acryllic and fibers, since August 1996. He was a founding
director of Arcadian Corporation, the largest nitrogen fertilizer
company in North America. Mr. Diassi was formerly a Director and
Chairman of the Finance Committee of Arcadian Corporation from 1989
to 1994. Mr. Diassi is a member of the Board of Directors of
Fibreglass Holdings, Inc., Amerlux Corp. and Software Plus, Inc. Mr.
Diassi serves as a member of the Compensation Committee of the Board
of Directors.
FRANK J. HEVRDEJS has been a director of the Company since its
inception in November 1993. In 1982, Mr. Hevrdejs co-founded The
Sterling Group, Inc., a major management buyout company. Mr.
Hevrdejs is a principal and president of The Sterling Group, Inc.
Additionally, he is Chairman of First Sterling Ventures Corp., an
investment company, Endoro Holdings, Inc., a structural and
electrical manufacturing company, and Fibreglass Holdings, Inc., a
truck accessory manufacturer. He is also a board member of Eagle
U.S.A., an air-freight company and a board member of Sterling
Chemicals, Inc., a petroleum chemical company. Mr. Hevrdejs serves
as Chairman of the Compensation Committee of the Board of Directors.
JANICE C. PETERS has not previously been a director of the
Company. Since October 1997, Ms. Peters has served as president and
chief executive officer of MediaOne(R), the broadband services arm
of MediaOne Group. Prior to joining MediaOne, Ms. Peters was
employed by US WEST, MediaOne's former parent company in various
positions including director of One2One, a United Kingdom wireless
communications joint venture between US WEST and Cable & Wireless,
and president of Wireless Operations for US WEST Media Group. Ms.
Peters serves on the Board of Directors of C-SPAN (the
Cable-Satellite Public Affairs Network), as well as the Walter Kaitz
Foundation, a cable industry organization that places diversity
candidates in industry management positions.
JEROME W. PICKHOLZ has been a director of the Company since June
1994. From 1978 to 1994, he was Chief Executive Officer of Ogilvy &
Mather Direct Worldwide, a direct advertising agency. From 1994
until September 1995, he served as Chairman of the Board of Ogilvy &
Mather Direct Worldwide where he is now Chairman Emeritus. Since
January 1996, Mr. Pickholz has served as founder and Chairman of
Pickholz, Tweedy, Cowan, L.L.C., a marketing communications company.
Mr. Pickholz serves as Chairman of the Audit Committee and a member
of the Nominating Committee of the Board of Directors.
WILLIAM R. THOMAS has been a director of the Company since
November 1998. He has served as Chairman of the Board of Directors
of Capital Southwest Corporation, a publicly-owned venture capital
investment company, since July 1982 and as President of that company
since 1980. In addition, Mr. Thomas has been a director of Capital
Southwest Corporation since 1972 and was previously Senior Vice
President from 1969 to 1980. Mr. Thomas also serves as a director of
Alamo Group, Inc., Encore Wire Corporation and Palm Harbor Homes,
Inc. Mr. Thomas is a member of the Audit Committee.
BOARD AND COMMITTEE MEETINGS
During 1998, the Board met on 6 occasions (4 regular meetings
and 2 special meetings). All other actions taken by the Board during
1998, were accomplished by means of unanimous written consent.
During 1998 all directors attended at least 75% of the meetings of
the Board and of the committees of the Board on which they were
members. The Board has an Audit Committee, a Compensation Committee
and a Nominating Committee.
The Audit Committee meets with the Company's independent
auditors to review the results of the annual audit and discuss the
financial statements. The committee also recommends to the Board the
3
<PAGE>
<PAGE>
independent auditors to be retained; receives and considers the
auditor's comments as to controls and adequacy of staff, and
management performance and procedures in connection with audit and
financial controls; reviews the system of internal controls and
compliance with policies regarding business conduct; and other
related matters. The Audit Committee, which is currently comprised
of Mr. Pickholz (Chairman) and Mr. Thomas, met 3 times during 1998.
The Compensation Committee is responsible for the compensation
arrangements of senior management and for the administration of the
Company's stock option plans. The committee makes recommendations
concerning salaries, incentive compensation and stock options to
officers and directors, and otherwise determines compensation levels
and performs such other functions regarding compensation as the
Board may delegate. See "Compensation Committee Report on Executive
Compensation." The committee is currently comprised of Mr. Hevrdejs
(Chairman) and Mr. Diassi. The Compensation Committee met 2 times
during 1998.
The Nominating Committee is responsible for identifying and
proposing for nomination to the full Board candidates for open
director positions. The Committee is currently comprised of Mr.
Mahoney (Chairman) and Mr. Pickholz, and has met informally on
several occasions during 1998 to discuss several candidates for
election to the Board.
DIRECTOR COMPENSATION
Each non-employee director of the Company receives:
* an annual retainer of $12,000;
* $1,000 for each regular meeting of the Board attended;
* $500 for each special meeting of the Board attended;
* $500 for each committee meeting of the Board attended;
* stock options for 4,500 shares of Common Stock each year upon
election or reelection to the Board pursuant to the 1996
Directors' Stock Option Plan; and
* stock options pursuant to the 1997 Non-Qualified Stock Option
Plan in amounts determined by the Compensation Committee.
Directors who are also employees of the Company do not receive
compensation for their service on the Board. The Company also
provides directors and officers liability insurance and indemnity
agreements for its directors.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The two members of the Compensation Committee, Messrs. Diassi
and Hevrdejs, have no interlocking relationships as defined by rules
and regulations of the Securities and Exchange Commission. The
Compensation Committee determined the compensation for the Company's
executive officers for 1998 and granted stock options in 1998 under
the Company's four stock option plans. See "Stock Option Plans."
4
<PAGE>
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of March 12, 1999, there were 48,876,259 shares of Common
Stock outstanding held of record by 494 stockholders. The following
table sets forth as of March 12, 1999, the number and percentage of
outstanding shares of Common Stock beneficially owned by (a) each
person known by the Company to beneficially own more than 5% of the
outstanding Common Stock, (b) each current director of the Company,
(c) each executive officer named in the Executive Compensation table
on page 6, and (d) all directors and executive officers of the
Company as a group. Shares of Common Stock subject to options
currently exercisable or exercisable within 60 days of the Record
Date are deemed outstanding for computing the percentage ownership
of the person holding the options.
<TABLE>
<CAPTION>
AMOUNT AND NATURE PERCENTAGE
OF BENEFICIAL OWNERSHIP OF OUTSTANDING
BENEFICIAL OWNERS OF COMMON STOCK<F1> COMMON STOCK
- ----------------- ----------------------- --------------
<S> <C> <C>
Goldman, Sachs & Co./The Goldman 2,875,789<F2> 5.9%
Sachs Group, L.P.
85 Broad Street
New York, NY 10004
SAFECO Asset Management Company 2,723,200<F3> 5.6%
601 Union Street, Suite 2500
Seattle, WA 98101
Gerald F. Mahoney 1,962,742<F4> 4.0%
Paul V. Reilly 223,312<F5> <F*>
Jerome W. Pickholz 62,290<F6> <F*>
Frank P. Diassi 1,559,254<F6><F7> 3.2%
Frank J. Hevrdejs 1,835,214<F6><F8> 3.8%
William R. Thomas 2,096,588<F9> 4.3%
Roger Wertheimer 65,148<F10> <F*>
V. Bruce Thompson 2,400 <F*>
Michael A. Zawalski 3,000 <F*>
All executive officers and directors of the
Company as a group (9 persons) 9,467,734 19.4%
<FN>
- ----------------------------
<F*> Less than 1.0%.
<F1> Unless otherwise noted, each stockholder has direct ownership
and sole voting and investment power with respect to the
indicated shares of Common Stock.
<F2> Goldman, Sachs disclaims beneficial ownership of shares held
by (a) client accounts with which Goldman, Sachs has voting or
investment power, and (b) investment entities, of which a
subsidiary of Goldman, Sachs is the general partner or
manager.
<F3> Shares are owned beneficially by registered investment
companies for which a subsidiary of SAFECO serves as advisor.
SAFECO disclaims beneficial ownership of these shares.
<F4> Includes 852,776 shares held by Mr. Mahoney's wife, 55,616
shares held by two trusts for his children of which Mr.
Mahoney is trustee, stock options for 395,890 shares, and
6,384 shares allocated to Mr. Mahoney under the Company's
Employee Stock Ownership Plan (the "ESOP").
<F5> Includes 26,698 shares held by Mr. Reilly's wife, 696 shares
held by a trust for his child of which Mr. Reilly is trustee,
stock options for 93,932 shares and 978 shares allocated under
the ESOP to Mr. Reilly. Does not include 1,657,786 shares
committed but not yet allocated to participants of the ESOP
for which Mr. Reilly shares voting power as a member of the
Benefits Administration Committee
<F6> Includes stock options for 23,400 shares.
5
<PAGE>
<PAGE>
<F7> Includes 82,396 shares held by two trusts of which members of
Mr. Diassi's immediate family are beneficiaries, 977,438
shares held by Winged Lion Holdings II L.L.C., which is
controlled by Mr. Diassi, 364,020 shares held jointly with Mr.
Diassi's wife, and 112,000 shares Mr. Diassi gifted to his
children of which he retained sole voting rights.
<F8> Includes 33,514 shares held by Mr. Hevrdejs' wife.
<F9> Includes 2,096,588 shares held by Capital Southwest. Mr.
Thomas is the President of Capital Southwest and disclaims
beneficial ownership of the shares held by Capital Southwest.
<F10> Includes stock options for 35,590 shares and 387 shares
allocated under the ESOP to Mr. Wertheimer.
</TABLE>
EXECUTIVE OFFICERS AND EXECUTIVE COMPENSATION
EXECUTIVE OFFICERS
Following are descriptions of the Company's executive officers,
including age (as of December 31, 1998), positions with the Company
and the business experience of each during the past five years. The
officers hold office until their successors are appointed by the
Board of Directors.
<TABLE>
<CAPTION>
NAME AGE POSITION(S)
- ---- --- -----------
<S> <C> <C>
Gerald F. Mahoney <F1> 55 Chairman and Chief Executive Officer
Paul V. Reilly <F1> 46 President and Chief Operating Officer
Michael A. Zawalski 39 Sr. Vice President and Chief Financial Officer
V. Bruce Thompson 51 Sr. Vice President--Corporate Development
Roger Wertheimer 39 Vice President--General Counsel and Secretary
Robert Meyer 42 Vice President--Treasurer and Tax
Douglas A. Mahoney 50 Vice President--Controller
<FN>
- ----------------------------
<F1> See "Information Concerning Directors and Nominees" above for a
biographical summary.
</TABLE>
MICHAEL A. ZAWALSKI has been Senior Vice President and Chief
Financial Officer of the Company since August 1998. From 1997 to
1998, Mr. Zawalski was Chief Financial Officer of Ryder TRS, Inc. a
moving and transportation business, responsible for all facets of
finance including investor and bank relations. From 1996 to 1997,
Mr. Zawalski was Vice President--Finance with the Coleman Company
where he directed worldwide planning and analysis, tax, accounting
and reporting matters. Prior to 1996, Mr. Zawalski held various
executive positions with Quaker Oats. Mr. Zawalski, a Certified
Public Accountant, began his career with Arthur Anderson & Co.
V. BRUCE THOMPSON has been Senior Vice President--Corporate
Development of the Company since August 1998. From 1994 until August
1998, Mr. Thompson was Senior Vice President, Marketing &
Administration and General Counsel of Forest Oil Corporation, a
publicly held exploration and production company. From 1993 to 1994,
Mr. Thompson was Vice President, Legal Affairs for Mid-America
Dairymen, Inc., a dairy cooperative, and from 1990 to 1993 he served
as Chief of Staff for James M. Inhofe, currently a U.S. Senator for
Oklahoma.
ROGER WERTHEIMER has been Vice President--General Counsel and
Secretary of the Company since February 1995. Mr. Wertheimer has
been engaged in the practice of law since 1984. He previously served
as Corporate Counsel for PACE Membership Warehouse, Inc., from 1988
to 1994 and practiced privately from March 1994 until February 1995
when he joined the Company.
6
<PAGE>
<PAGE>
ROBERT MEYER has been Vice President--Treasurer and Tax of the
Company since October 1998. Mr. Meyer is a licensed attorney,
Certified Public Accountant and Certified Financial Planner. From
1988 to 1998, Mr. Meyer was a Partner in the tax department of the
accounting firm of Deloitte & Touche LLP.
DOUGLAS A. MAHONEY has been Vice President--Controller of the
Company since July 1997. From 1991 until July 1997 Mr. Mahoney was
Senior Vice President--Administration and Chief Financial Officer of
Quality Park Products, a manufacturer of envelopes and filing
supplies which was acquired by the Company in March 1996. Prior to
that, Mr. Mahoney spent ten years with Tetra Pak, the U.S. division
of a worldwide packaging equipment and paperboard converter, where
he held a variety of positions including Director of Finance, Vice
President and Controller. Mr. Mahoney is a Certified Public
Accountant.
There are no arrangements or understandings between the
Company's directors or officers, or any other persons, pursuant to
which any of the directors have been selected as directors or
officers have been selected as officers.
EXECUTIVE COMPENSATION
The following table sets forth information concerning all
compensation received for services rendered for the three years
ended December 31, 1998, by the Company's Chief Executive Officer
and by the four most highly compensated executive officers who were
serving as executive officers at the end of 1998 and whose total
annual salary and bonus exceeded $100,000.
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
LONG-TERM
COMPENSATION<F1>
ANNUAL COMPENSATION ------------------------
---------------------------------- RESTRICTED SECURITIES
OTHER ANNUAL STOCK UNDERLYING ALL OTHER
SALARY BONUS COMPENSATION AWARD(S) OPTIONS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR $ $<F2> ($) (#) (#) ($)
- --------------------------- ---- ------ ----- ------------ ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Gerald F. Mahoney 1998 450,000 384,300 <F3> 0 50,000 0
Chairman of the Board and 1997 350,000 490,000 <F3> 0 285,000 0
Chief Executive Officer 1996 250,000 137,500 <F3> 56,493 30,000 0
Paul V. Reilly 1998 275,000 201,300 <F3> 0 80,000 0
President and Chief 1997 200,000 220,000 <F3> 0 87,000 0
Operating Officer 1996 150,000 80,000 <F3> 11,054 15,000 6,500
Roger Wertheimer 1998 140,000 68,320 <F3> 0 10,000 0
Vice President, 1997 128,000 102,400 <F3> 0 15,000 0
General Counsel and Sec. 1996 118,000 29,500 <F3> 5,649 3,750 0
Michael A. Zawalski 1998 79,167 50,000 <F3> 0 50,000 0
Sr. Vice President, 1997 -- -- -- -- -- --
Chief Financial Officer 1996 -- -- -- -- -- --
Douglas A. Mahoney<F4> 1998 110,000 20,000 <F3> 0 4,000 0
Vice President, Controller 1997 102,346 21,376 <F3> 0 9,000 30,062
1996 70,424 81,063 <F3> 0 4,500 0
<FN>
- --------------------------------
<F1> All stock amounts reflect the 2-for-1 stock split in June 1998.
<F2> Bonus amounts are shown for the year earned and are paid in the
following year.
<F3> None of the named executive officers has received perquisites,
the value of which exceeded the lesser of either $50,000 or 10%
of the total salary and bonus. Perquisites paid include
contributions to such person's 401(k) account, tax
reimbursements and car allowance.
<F4> 1996 amounts and a portion of 1997 amounts represent
compensation paid by Quality Park Products, prior to its
acquisition by Mail-Well. Other compensation for 1997 was
compensation for relocation expenses.
</TABLE>
7
<PAGE>
<PAGE>
STOCK OPTION PLANS
1994 PLAN AND THE 1998 PLAN. On February 17, 1994, and February
22, 1994, the Board of Directors adopted and the stockholders
approved, respectively, the Company's 1994 Stock Option Plan, as
subsequently amended ("1994 Plan"). Currently, there are 1,918,350
shares authorized for grant pursuant to the 1994 Plan. Of this
amount, as of March 12, 1999, options for 1,846,578 shares of Common
Stock had been granted.
On February 4, 1998 and April 29, 1998, the Board of Directors
and the stockholders approved, respectively, the Company's 1998
Stock Option Plan ("1998 Plan"). Currently, there are 1,000,000
shares authorized for grant pursuant to the 1998 Plan. Of this
amount, as of March 12, 1999, options for 184,970 shares of Common
Stock had been granted.
Under the 1994 Plan and the 1998 Plan, the Compensation
Committee of the Board of Directors (the "Committee") may grant
incentive and non-qualified stock options to key employees
(including officers and directors who are key employees) of the
Company and its affiliates. The Committee determines the prices,
expiration dates and other material features of the options granted
and has discretionary authority to prescribe, amend and rescind
rules and regulations relating to the 1994 Plan and the 1998 Plan,
to interpret the 1994 Plan and the 1998 Plan, to prescribe and amend
the terms of any agreements executed pursuant to the 1994 Plan or
1998 Plan (which need not be identical) and to make all other
determinations deemed necessary or advisable for the administration
of the 1994 Plan or 1998 Plan.
Unless earlier terminated, the 1994 Plan terminates on March 1,
2005 and the 1998 Plan terminates on April 29, 2008. The Board may
terminate or amend the 1994 Plan or 1998 Plan at any time, except
that the stockholders must approve any amendment that would increase
the number of shares of Common Stock available under the 1994 Plan
or the 1998 Plan, change the provisions regarding option price
(except as otherwise permitted under the 1994 Plan or 1998 Plan) or
materially increase the cost of the 1994 Plan or 1998 Plan or
increase the benefits to participants.
The Committee may award incentive stock options ("ISOs") within
the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code"), or options that do not constitute ISOs and are
therefore non-qualified stock options ("Non-Qualified Options").
With respect to ISOs, the aggregate fair market value (determined at
the time the ISO is granted) of the Common Stock exercisable for the
first time by an employee during any calendar year is limited to
$100,000. Each option granted will terminate with respect to any
shares not previously purchased by the optionee upon the expiration
of ten years from the date of the grant of the option or such
earlier date as the Committee may prescribe; provided, that ISOs
granted to an individual who, at the time of grant, owns stock
possessing more than 10% of the total combined voting power of all
classes of stock of the Company (a "10% Stockholder"), will
terminate no later than five years from the date of grant.
The 1994 Plan and 1998 Plan require that the purchase price of
each share subject to an ISO must be not less than 100% of the fair
market value of such share on the date the option is granted. In the
case of an ISO granted to a 10% Stockholder, the purchase price of
each share subject to the option must be at least 110% of the fair
market value of a share of Common Stock on the date the option is
granted. The purchase price of each share subject to a Non-Qualified
Option is determined by the Committee in its sole discretion prior
to granting the option; provided, that the purchase price of each
share subject to a Non-Qualified Option may not be less than 85% of
the fair market value on the date the option is granted, as
determined by the Committee.
All of the options granted under the 1994 Plan and 1998 Plan
have been granted at fair market value, vest ratably over a period
of either four (4) or five (5) years and expire ten years after the
date of grant. All unvested options shall vest upon a change of
control as defined in the 1994 Plan and 1998 Plan.
8
<PAGE>
<PAGE>
1996 DIRECTORS PLAN. On May 8, 1996, the Board adopted the 1996
Directors' Stock Option Plan ("Directors Plan") which was approved
by stockholders on May 7, 1997. Currently, there are 420,000 shares
authorized for grant pursuant to the 1996 Directors Plan. Of this
amount, on March 12, 1999, options for 96,000 shares of Common Stock
had been granted. The 1996 Directors Plan provides a means by which
the Company, through the grant of stock options to eligible
directors, may attract and retain persons of ability as directors,
and motivate such directors to exert their best efforts on behalf of
the Company and its stockholders.
Pursuant to the 1996 Directors Plan, each non-employee director
of the Company receives Non-Qualified Options for 4,500 shares of
Common Stock annually upon the election or reelection of such person
to the Board. Such grants are automatic and shall continue until all
options have been granted for all the shares under the 1996
Directors Plan or until the 1996 Directors Plan is discontinued.
Options granted under the 1996 Directors Plan may be exercised
one (1) year from the date of grant and prior to the tenth
anniversary date of the grant. All unexercised options expire on the
tenth anniversary of their grant date. All unvested options shall
vest upon a change of control as defined in the 1996 Directors Plan.
The purchase price for shares subject to options is the average
closing price of the Common Stock as reported in the Wall Street
Journal for the five trading days immediately preceding the grant
date. The purchase price shall be paid to the Company at the time of
exercise.
Awards under the 1996 Directors Plan are not transferable except
by will or by the laws of descent and distribution, or pursuant to a
qualified domestic relations order. Options granted under the 1996
Directors Plan are exercisable during the lifetime of the optionee
by the optionee. Awards under the 1996 Directors Plan are subject to
adjustment in the event of a stock dividend, stock split,
recapitalization or combination of the Common Stock. In the event of
certain mergers, consolidations, plans of exchange or other
reorganizations of the Company, outstanding awards under the 1996
Directors Plan are subject to adjustment to reflect the terms of
such transaction.
The Board may amend, suspend or discontinue the 1996 Directors
Plan, but no amendment or alteration shall be made which would
impair the rights of any optionee, without his or her consent, under
any option theretofore granted, or which, without the approval of
the stockholders, would:
* increase the total number of shares reserved for the purposes
of the 1996 Directors Plan;
* amend certain provisions of the 1996 Directors Plan which set
forth the terms and conditions of the options granted
(including term, option price and nontransferability) and
compliance with federal and state laws; or
* modify the requirement as to eligibility for participation in
the 1996 Directors Plan.
The 1996 Directors Plan may be amended not more frequently than
every six months.
1997 NQ PLAN. On March 31, 1997, the Board adopted the
Mail-Well, Inc. 1997 Non-Qualified Stock Option Plan (the "1997 NQ
Plan"). Currently, there are 1,950,000 shares of Common Stock
authorized for grant pursuant to the 1997 NQ Plan. Of this amount,
on March 12, 1999, options for 1,194,330 shares have been granted.
The 1997 NQ Plan provides the means by which the Company, through
the grant of options, encourages ownership of the Company by
eligible key employees and directors of the Company and its
affiliates, and provides increased incentives for such persons to
render services and to assert maximum effort for the business
success of the Company.
Under the 1997 NQ Plan, the Committee may grant Non-Qualified
Options to such key employees and directors of the Company or its
affiliates as the Committee shall determine. Subject to the express
provisions of the 1997 NQ Plan, the Committee determines the prices,
expiration dates, vesting schedules, and other material features of
the Non-Qualified Options granted and makes all other determinations
9
<PAGE>
<PAGE>
necessary or advisable for the administration of the 1997 NQ Plan.
All unexercised options shall expire on the tenth anniversary of
their grant date. All unvested options shall vest upon a change of
control as defined in the 1997 NQ Plan.
Awards under the 1997 NQ Plan are not transferable except by
rule or by the laws of descent and distribution, or pursuant to a
qualified domestic relations order. Options granted under the 1997
NQ Plan shall be exercisable during the lifetime of the optionee.
Awards under the 1997 NQ Plan are subject to adjustment in the event
of a stock dividend, stock split, recapitalization or combination of
the Common Stock. In the event of certain mergers, consolidations,
plans of exchange or other reorganizations of the Company,
outstanding awards under the 1997 NQ Plan are subject to adjustment
to effect the terms of such transaction.
The Board of Directors may amend, alter or discontinue the 1997
NQ Plan, but no amendment or alteration shall be made which would
impair the rights of any optionee, without his or her consent.
The following table sets forth information concerning stock
options granted to each of the named executive officers and the
potential realizable value for the stock options based on future
appreciation assumptions.
<TABLE>
OPTION GRANTS IN 1998
<CAPTION>
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES OF
NUMBER OF % OF TOTAL STOCK PRICE APPRECIATION
SECURITIES UNDERLYING OPTIONS GRANTED EXERCISE FOR OPTION TERM<F1>
OPTIONS GRANTED TO EMPLOYEES PRICE EXPIRATION -----------------------------
(#) IN 1998 ($) DATE 5% ($) 10% ($)
--------------------- --------------- -------- ---------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Gerald F. Mahoney 50,000 4.20% 12.00 04-15-08 238,687 674,765
Paul V. Reilly 80,000 6.71% 12.00 04-15-08 381,899 1,079,625
Roger Wertheimer 10,000 .84% 12.00 04-15-08 47,737 134,953
Michael A. Zawalski 50,000 4.20% 12.00 09-15-08 280,621 802,242
Douglas A. Mahoney 4,000 .34% 12.00 04-15-08 19,095 53,981
<FN>
- ----------------------------
<F1> Amounts reported in these columns show hypothetical gains that
may be realized upon exercise of the options assuming that
market price of Common Stock appreciates at the specified
annual rates of appreciation, compounded annually over the
terms of the options. These numbers are calculated based upon
rules promulgated by the SEC. Actual gains, if any, depend on
the future performance of Common Stock and overall market
conditions.
</TABLE>
10
<PAGE>
<PAGE>
The following table sets forth information about the number and
value of stock options exercised in 1998 and held at December 31,
1998 by each named executive officer.
<TABLE>
AGGREGATED OPTION EXERCISES IN 1998 AND YEAR END OPTION VALUES
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
SHARES VALUE AT 12-31-98 (#) AT 12-31-98 ($)<F1>
ACQUIRED ON REALIZED ------------------------- -------------------------
EXERCISE (#) ($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
------------ -------- ------------------------- -------------------------
<S> <C> <C> <C> <C>
Gerald F. Mahoney 0 0 239,917/567,973 1,745,485/2,730,113
Paul V. Reilly 45,034 733,476 33,540/243,792 182,013/875,777
Roger Wertheimer 8,000 207,426 20,130/45,210 162,540/218,870
Michael A. Zawalski 0 0 0/50,000 0/0
Douglas A. Mahoney 0 0 4,050/13,450 17,334/17,334
<FN>
- ----------------------------
<F1> Represents the difference between option exercise price and the
closing sales price per share of the Common Stock as quoted on
the NYSE on December 31, 1998 ($11.44 per share).
</TABLE>
REPRICING OF STOCK OPTIONS. On December 14, 1998, the Committee
approved the repricing of all stock options granted in 1998 to
employees of the Company and its subsidiaries. All options granted
in 1998 with an exercise price above $12.00 per share were repriced
to an exercise price of $12.00. The following table sets forth
information concerning the repricing of stock options held by each
of the named executive officers:
<TABLE>
TEN-YEAR OPTION REPRICINGS
<CAPTION>
SECURITIES MARKET PRICE LENGTH OF
UNDERLYING OF STOCK AT ORIGINAL OPTION
NUMBER OF TIME OF EXERCISE PRICE NEW TERM REMAINING
OPTIONS REPRICING AT TIME OF EXERCISE AT DATE OF
NAME DATE REPRICED (#) ($) REPRICING ($) PRICE ($) REPRICING
- ---- -------- ------------ ------------ -------------- --------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Gerald F. Mahoney 12-14-98 50,000 $10.81 $19.52 $12.00 112 mos.
Paul V. Reilly 12-14-98 80,000 $10.81 $19.52 $12.00 112 mos.
Roger Wertheimer 12-14-98 10,000 $10.81 $19.52 $12.00 112 mos.
Michael A. Zawalski 12-14-98 50,000 $10.81 $16.95 $12.00 116 mos.
Douglas A. Mahoney 12-14-98 4,000 $10.81 $19.52 $12.00 112 mos.
</TABLE>
EMPLOYEE BENEFITS
BONUS PLAN. In 1998 the Board of Directors adopted a Cash Bonus
Incentive Plan (the "Bonus Plan") pursuant to which the named
executives and key employees may receive bonus compensation. The
Bonus Plan is further described at "Compensation Committee Report on
Executive Compensation--Components of Compensation."
401(k) SAVINGS RETIREMENT PLAN. The Company's subsidiary,
Mail-Well I Corporation, has maintained a 401(k) Savings Retirement
Plan (the "Plan") since 1994 for employees. A full-time employee of
the Company can participate in the Plan after completing one year of
service. For 1999, a participant can contribute to the Plan up to the
lesser of $10,000 or 20% of his compensation. During 1999, a cash
matching contribution will be made by the Company for each participant
who contributes to the Plan equal to 50% of the participant's
contributions, up to a maximum of 6% of the participant's compensation
11
<PAGE>
<PAGE>
for the year. Only $160,000 of a participant's compensation is
considered for purposes of Plan contributions. All contributions
are not included in the participant's current taxable income.
Plan monies are held in trust. A Plan participant can direct the
investment of his contributions and the matching contributions into
one of eight mutual funds, which include a Company stock fund.
Participant contributions to the Plan are always fully vested while
matching contributions become nonforfeitable in increments of 20%
for each year of service completed by the participant. Generally, a
participant's vested Plan benefit is distributable upon his
retirement, total and permanent disability, death or other
termination from employment.
EMPLOYEE STOCK OWNERSHIP PLAN. The Company's subsidiary,
Mail-Well I Corporation, has maintained an Employee Stock Ownership
Plan (the "ESOP") since 1994 for employees. A full-time employee can
participate in the ESOP after completing a year of service and
attaining age 21. The only source of contributions to the ESOP are
contributions made by the Company and related entities that have
adopted the ESOP. Contributions in 1999 and future years will be
determined in the sole discretion of the Board of Directors. There
is presently no minimum contribution requirement. Contributions to
the ESOP may be made in Company stock or cash. Any contribution is
allocated to the account of an ESOP participant in the proportion
that his compensation bears to the compensation of all participants
for the year of the contribution. Only $100,000 of a participant's
compensation is considered for purposes of an allocation.
Contributions are not included a participant's current taxable
income. Generally, a participant must be employed throughout the
year and on the last day of the year in order to receive an
allocation of any ESOP contribution for that year.
The ESOP monies are held in trust and primarily invested in the
Company's Common Stock at the direction of the Mail-Well I
Corporation Benefits Administration Committee. Contributions
allocated to a participant's Plan account will become nonforfeitable
in increments of 20% for each year of service completed by the
participant. Amounts that are forfeited from a partially-vested
participant's account are allocated to the remaining participants'
accounts as an additional contribution. Generally, a participant's
ESOP benefit is distributable after his retirement, total and
permanent disability, death or other termination from employment.
12
<PAGE>
<PAGE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Decisions on compensation for the Company's executive officers
for the year ending December 31, 1998, were made by the two member
Compensation Committee of the Board. Each member of the Committee is
an outside director. None of the members of the Committee has ever
been an officer or employee of the Company or any of its
subsidiaries. The Committee is responsible for establishing and
administering the policies that govern the annual compensation and
stock ownership programs for the executive officers and key
employees.
COMPENSATION PHILOSOPHY
The Company's executive compensation policies are designed to:
* align compensation with the Company's annual and long-term
performance goals;
* to attract and retain a highly qualified and motivated
management team; and
* to reward individual performance and to link the interests of
the executive officers directly with those of shareholders
through the use of the Common Stock as a compensation vehicle.
These policies have been implemented by setting salaries and
bonuses for executives which are generally lower than the mid-point
for salaries and bonuses given to executives in similar positions,
but offering a total compensation package (including grants of stock
options and restricted Common Stock) which should compensate the
executives at a level consistent with, or above, the mid-point for
total gain opportunities received by counterparts at similar
companies. This compensation design emphasizes long-term incentives
that will encourage executives to maintain their focus on long-term
shareholder interests.
COMPONENTS OF COMPENSATION
Total compensation for each executive officer is set by the
Committee at levels which it believes are competitive in relation to
companies of similar type and size based upon a study and
recommendations provided by an independent compensation consultant.
The components of executive compensation include salary, equity
participation in the Company in the form of options to purchase
Common Stock, grants of restricted Common Stock and the Bonus Plan
discussed below. Compensation for executive officers of the Company
is usually set by the Committee in March or April of each year for
that year. Due to the level of compensation received by the
executive officers of the Company, and the fact that none of the
executive officers have employment agreements, the Committee has not
yet deemed it necessary to adopt a policy regarding the one million
dollar limit on deductibility of certain executive compensation
under Section 162 (m) of the Internal Revenue Code.
BASE SALARY. The Committee reviews the salaries of the
executive officers annually. The Committee's policy is to fix base
salaries at levels below the mid-point for amounts paid to senior
executives with comparable qualifications, experience and
responsibilities at other companies of similar size and engaged in a
similar business to that of the Company. Salary recommendations are
submitted annually to the Committee by the Chairman and Chief
Executive Officer. In determining salary compensation, the Committee
takes into account:
* management's success and ability to accomplish certain
strategic goals in operating and growing the Company;
* the Company's level of debt;
* the accomplishment of the Company's continuing acquisition
strategy;
* the desire to maintain low fixed costs;
13
<PAGE>
<PAGE>
* the complexity of the challenges which face the executive
officers; as well as
* management's consistent commitment to the long-term success of
the Company.
In addition, the base salaries take into account the
individual's experience within the industry, with the Company and
its predecessors, and/or within the profession. The Committee
believes that compensation for its executive officers has been
competitive, appropriate and comparable to similarly situated
companies.
Based upon its evaluation of these factors, the Committee
believes that senior management is dedicated to achieving long-term
financial improvements, and that the compensation policies, plans
and programs administered by the Committee contribute to
management's commitments. The Committee attempts to assimilate all
of the foregoing factors when it renders its compensation decisions;
however, the Committee recognizes that its decisions are primarily
subjective in nature. The Committee does not assign any specified
weight to the criteria it considers.
The Committee's recommendations are offered to the full Board of
the Company. The Committee's recommendations are ultimately
ratified, changed or rejected by the Board.
LONG-TERM INCENTIVES. The Company believes that the interests
of stockholders and of the Company's key employees, including
officers and directors, are more closely aligned when such key
employees, are provided an opportunity to acquire a proprietary
interest through ownership of Common Stock. Officers, directors and
other key employees are granted options under the Company's stock
option plans to purchase Common Stock. To date, the Company has only
granted stock options at a price equal to or greater than fair
market value. The number of options granted by the Committee are
based upon the Committee's evaluation of the anticipated performance
requirements and contributions of each employee, as well as each
employee's current equity participation in the Company. In addition,
the Committee seeks the recommendation of senior management with
respect to options granted to key employees of the Company. In April
1998, the Committee granted options representing 180,000 shares of
Common Stock.
The grant of stock options to executive officers in 1998 was
made with the intention of further aligning the interests of those
executive officers with that of shareholders by providing incentives
to achieve the long-range goals of the Company. Appreciation in the
price of the Common Stock is intended to bring total compensation to
the mid-point, or above, for that of the executives' counterparts at
similar companies.
BONUS. Bonus compensation is paid to officers under the
Company's Bonus Plan. Bonuses were paid as a percentage of each
executive's 1998 base salary and were based upon the level of
attainment of pre-tax income goals established by the Board for each
officer. The components which are considered in paying bonuses to
the executive officers include profitability of the Company and the
employee's job performance.
REPORT ON REPRICING OF OPTIONS
On December 14, 1998 the Committee approved the repricing of all
stock options granted in 1998 to employees of the Company and its
subsidiaries. All options granted to employees in 1998 with an
exercise price above $12.00 per share were repriced to an exercise
price of $12.00 per share. All other terms and conditions of the
original option grants, including the grant date and vesting
schedule, remained the same. This action was taken to help restore
the incentive value of these options to the holders and to retain
and motivate the Company's employees. The Committee considered the
potential reasons for the significant decline in the stock price in
1998 and concluded that the event was largely not related to any
failure of the
14
<PAGE>
<PAGE>
stock options grantees to successfully perform their jobs. The
reduction of exercise price affected options to purchase 709,470
shares of Common Stock.
CHIEF EXECUTIVE OFFICER COMPENSATION
Mr. Mahoney has served as Chief Executive Officer and Chairman
of the Board of the Company since 1994. As Chief Executive Officer,
Mr. Mahoney receives a base salary and stock options and is also
eligible for a bonus pursuant to the Bonus Plan and grants of
restricted Common Stock. The Committee reviewed Mr. Mahoney's
performance, particularly his continued contribution to the
significant growth of the Company, acquisitions of the Company, and
the integration of acquired businesses in determining his base
salary. The Committee assessed Mr. Mahoney's overall performance and
the above referenced performance factors on a subjective basis and
did not assign relative weights to these factors. As a result of
these considerations, the Committee granted Mr. Mahoney an increase
in base salary of $100,000 from $350,000 annually to $450,000
annually, effective March 1, 1998. In April 1998 the Committee
granted options for 50,000 shares of Common Stock to Mr. Mahoney
under the 1997 NQ Plan. This grant was made pursuant to the policies
and philosophy described above. Consistent with the Committee's
compensation philosophy discussed above, Mr. Mahoney's salary and
bonus has been lower than the mid-point for salaries of CEOs at
similar companies. However, it is the Committee's objective that the
total compensation package awarded to Mr. Mahoney meet or exceed the
mid-point for total gain opportunities received by CEOs at similar
companies, chiefly through the opportunity to share in the
appreciation of the price of the Common Stock.
CONCLUSION
In summary, the Committee believes that its policy of linking
executive compensation to Company performance was met. The Committee
believes that the Company's compensation levels adequately reflect
its philosophy. In addition, the Committee believes that the
Company's executive compensation programs and policies are
supportive of its overall objective to enhance stockholder value
through the profitable management of its operations.
Frank J. Hevrdejs (Chairman)
Frank P. Diassi
15
<PAGE>
<PAGE>
STOCK PRICE PERFORMANCE GRAPH
The following graph presents the cumulative total quarterly
stockholder return (assuming reinvestment of dividends, if any) from
investing $100 on September 22, 1995 (the date the Common Stock
began trading on the NASDAQ Stock Market) in each of (i) the Common
Stock; (ii) Standard & Poor's 500 Index; and (iii) a Company chosen
peer group, weighted by market capitalization, which includes
Consolidated Graphics, Inc., Deluxe Corporation, R. R. Donnelley &
Sons Company, Merrill Corporation and Standard Register Company (the
"Peer Group Index"). On December 19, 1996, the Company delisted from
the NASDAQ Stock Market and listed the Common Stock on the New York
Stock Exchange.
[GRAPH]
<TABLE>
<CAPTION>
MAIL-WELL PEER GROUP S&P 500
--------- ---------- -------
<S> <C> <C> <C>
22 Sep 95 $100.00 $100.00 $100.00
29 Sep 95 96.43 99.33 100.45
29 Dec 95 87.50 97.91 105.87
29 Mar 96 58.04 91.29 110.95
28 Jun 96 62.50 95.58 115.28
30 Sep 96 76.79 93.17 118.14
27 Dec 96 116.96 90.72 130.08
27 Mar 97 133.26 96.93 133.02
27 Jun 97 277.23 104.27 152.52
26 Sep 97 289.29 101.83 162.47
26 Dec 97 405.81 105.06 160.97
31 Mar 98 405.80 114.72 189.38
30 Jun 98 464.73 126.29 194.89
30 Sep 98 183.48 99.57 174.81
31 Dec 98 245.09 123.68 211.29
</TABLE>
16
<PAGE>
<PAGE>
COMPLIANCE WITH SECTION 16(a)
Section 16(a) of the Securities Exchange Act of 1934, as
amended, requires the Company's directors, executive officers and
holders of more than 10% of the Common Stock to file with the
Securities and Exchange Commission initial reports of ownership and
reports of changes in ownership of the Common Stock. Based solely
upon a review of Forms 3, 4 and 5 and amendments thereto furnished
to the Company with respect to the year ended December 31, 1998, to
the best of the Company's knowledge the Company's directors,
officers and holders of more than 10% of its Common Stock complied
with all Section 16(a) filing requirements.
PROPOSAL 1--ELECTION OF DIRECTORS
GENERAL
At the Annual Meeting, seven directors will be elected, each to
hold office until the Company's 2000 Annual Meeting of Stockholders
or until his or her respective successor has been elected and
qualified. All of the nominees are currently directors of the
Company, except for Janice Peters. The Board has no reason to
anticipate that any nominee will decline or be unable to serve as a
director. In the event any nominee does decline or is unable to
serve, proxies may be voted for the election of a substitute nominee
or the Board may reduce the number of directors to be elected.
The shares of Common Stock represented by the enclosed proxy
will be voted for the election to the Board of the seven nominees
named below, unless a vote is withheld from one or more individual
nominees. If any nominee becomes unavailable for any reason, or if a
vacancy should occur before election, shares represented by the
enclosed proxy may be voted for such other person as may be
determined by the holders of such proxy. The simple majority vote of
shares voting is required for election of directors.
THE BOARD RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF GERALD F.
MAHONEY, PAUL V. REILLY, FRANK P. DIASSI, FRANK J. HEVRDEJS, JANICE
C. PETERS, JEROME W. PICKHOLZ AND WILLIAM R. THOMAS.
PROPOSAL 2--RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Company has appointed Ernst & Young LLP to serve as the
Company's independent auditors for the fiscal year ended December
31, 1999, to replace Deloitte & Touche LLP, who were dismissed as
auditors of the Company effective March 3, 1999. Management
recommends that Ernst & Young LLP be ratified as the principal
accounting firm to be utilized by the Company throughout the year
ending December 31, 1999.
The decision of the Company to change independent auditors was
approved by the Audit Committee of the Board of Directors. The audit
reports of Deloitte & Touche LLP on the Company's consolidated
financial statements for the fiscal years ended December 31, 1998
and 1997 did not contain an adverse opinion or disclaimer of opinion
and were not qualified or modified as to uncertainty, audit scope or
accounting principles.
During the two most recent fiscal years and through the interim
period ended March 3, 1999, the Company has had no disagreements
with Deloitte & Touche LLP on any matter of accounting principles or
practices, financial statement disclosure or auditing scope or
procedure, which disagreement, if not resolved would have caused
them to make reference thereto in their report on the consolidated
financial statements of the Company for such years.
17
<PAGE>
<PAGE>
Deloitte & Touche LLP has furnished the Company with a letter
addressed to the Securities and Exchange Commission stating that
they agree with the statements in the preceding two paragraphs.
The Company engaged Ernst & Young LLP as its new independent
auditors effective March 3, 1999. During the two most recent fiscal
years and through March 3, 1999, the Company has not consulted with
Ernst & Young LLP regarding (1) the application of accounting
principals to any transaction; (2) the type of audit opinion that
might be rendered on the Company's financial statements; (3) any
disagreement or reportable event as those items are described or
defined in Items 304(a)(1)(iv) and 304(a)(1)(v) of Regulation S-K;
or (4) any other matter set forth in Item 304(a)(2) of Regulation
S-K.
The Company anticipates that representatives of Ernst & Young
LLP will attend the Annual Meeting for the purpose of responding to
appropriate questions. At the Annual Meeting, the representatives of
Ernst & Young LLP will be afforded an opportunity to make a
statement if they so desire.
REQUIRED VOTE
Ratification of the selection of Ernst & Young LLP as the
Company's independent auditors requires the affirmative vote of a
majority of the outstanding shares of Common Stock present, in
person or by proxy, and entitled to vote at the Annual Meeting.
THE BOARD RECOMMENDS THAT YOU VOTE FOR THE RATIFICATION OF THE
SELECTION OF ERNST & YOUNG LLP AS THE COMPANY'S AUDITORS FOR 1999.
STOCKHOLDER PROPOSALS
Proposals of stockholders that are intended to be presented at
the Company's 2000 Annual Meeting of Stockholders must be received
by the Company at its principal executive offices not later than
February 25, 2000, in order to be included in the proxy statement
and form of proxy relating to the annual meeting.
OTHER ITEMS
The Board does not intend to present further items of business
to the meeting and knows of no such items which will or may be
presented by others. However, if any other matter properly comes
before the meeting, the persons named in the enclosed proxy form
will vote thereon in such manner as they may in their discretion
determine.
By Order of the Board of Directors,
/s/ Roger Wertheimer
Roger Wertheimer
Vice President--General Counsel and
Secretary
Englewood, Colorado
March 22, 1999
18
<PAGE>
<PAGE>
REVOCABLE PROXY MAIL-WELL,INC. REVOCABLE PROXY
SOLICITED BY THE BOARD OF DIRECTORS FOR
ANNUAL MEETING OF SHAREHOLDERS, MAY 5, 1999
The undersigned holder of common stock of Mail-Well, Inc., a Colorado
corporation (the "Company"), acknowledges receipt of a copy of the Notice of
Annual Meeting of Shareholders dated March 22, 1999, and, revoking any proxy
heretofore given, hereby appoints Roger Wertheimer and Paul V. Reilly, and
each of them, with full power to each of substitution as attorneys and proxies
to appear and vote all shares of common stock of the Company registered in the
name(s) of the undersigned and held by the undersigned of record as of March
12, 1999, at the Annual Meeting of Shareholders of the Company to be held at
the Hyatt Regency Tech Center, 7800 Tufts Avenue, Denver, Colorado, on May 5,
1999, at 8:30 a.m., and at any postponements and adjournments thereof, upon
the following items as set forth in the Notice of Annual Meeting and to vote
according to their discretion on all other matters which may be properly
presented for action at the meeting. All properly executed proxies will be
voted as indicated.
UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED "FOR" THE FOLLOWING ITEMS:
(1) To elect as directors the nominees listed below.
/ / FOR ALL nominees listed below / / WITHHOLD AUTHORITY to vote for
(except as marked to the contrary). all nominees listed below.
Instruction: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE
A LINE THROUGH THAT NOMINEE'S NAME IN THE LIST BELOW:
Frank P. Diassi, Frank J. Hevrdejs, Gerald F. Mahoney, Janice C. Peters,
Jerome W. Pickholz, Paul V. Reilly, William R. Thomas
(2) To ratify the selection of Ernst & Young LLP, independent auditors, as
auditors of the Company for the year ending December 31, 1999.
/ / FOR / / AGAINST / / ABSTAIN
(Continued on reverse side.)
(3) In their discretion, the proxy holders are authorized to vote upon such
other business as may properly come before the meeting or matters incidental to
the conduct of the meeting.
THIS PROXY IS SOLICITED BY AND ON BEHALF OF THE BOARD OF DIRECTORS AND MAY BE
REVOKED PRIOR TO ITS EXERCISE. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
PROPOSALS 1 and 2. THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED.
IF NO DIRECTION IS MADE IT WILL BE VOTED "FOR" PROPOSALS 1 and 2.
WITNESS my hand this ___ day of __________, 1999.
_________________________________________________
_________________________________________________
Signature of Shareholder(s)
(Please sign exactly as name appears hereon. When
signing as attorney, executor, administrator,
trustee or guardian, give full title as such. If
a corporation, please affix corporate seal. If a
partnership, please sign in partnership name by
authorized persons. If joint tenants, each joint
tenant should sign.)
WHETHER OR NOT YOU PLAN TO ATTEND THIS MEETING, PLEASE MARK, SIGN, DATE AND
RETURN THIS PROXY CARD PROMPTLY BY USING THE ENCLOSED POSTAGE-PAID ENVELOPE.
I/WE DO ____ DO NOT ____ EXPECT TO ATTEND THIS MEETING.
<PAGE>
<PAGE>
APPENDIX
Page 16 of the printed Proxy contains a Performance Graph. The
information contained in the graph appears in the table immediately
following the graph.
