SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement
(Pursuant to Section 14(a) of the Securities Exchange Act of 1934)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Materials Pursuant to Rule 14a-11(c) or Rule 14a-12
WINSLOEW FURNITURE, INC.
(Name of Registrant as specified in its Charter)
WINSLOEW FURNITURE, INC.
(Name of Person(s) Filing Proxy Statement)
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:
(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 No.:
(3) Filing Parties:
(4) Date Filed:
WINSLOEW FURNITURE, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be held on June 2, 1998
To the Shareholders of
WinsLoew Furniture, Inc.
The 1998 Annual Meeting of Shareholders (the "Annual Meeting") of WinsLoew
Furniture, Inc., a Florida corporation (the "Company"), will be held at
9:00 a.m., local time, on Tuesday, June 2, 1998, at The Grand Bay Hotel, 2669
South Bayshore Drive, Miami, Florida 33133, for the following purposes:
(1) To elect three members to the Company's Board of Directors to hold
office until the Company's 2001 Annual Meeting of Shareholders or until their
successors are duly elected and qualified; and
(2) To transact such other business as may properly come before the Annual
Meeting and any adjournments or postponements thereof.
The Board of Directors has fixed the close of business on April 6, 1998 as
the record date for determining those shareholders entitled to notice of, and
to vote at, the Annual Meeting and any adjournments or postponements thereof.
Whether or not you expect to be present, please sign, date and return the
enclosed proxy card in the enclosed pre-addressed envelope as promptly as
possible. No postage is required if mailed in the United States.
By Order of the Board of Directors
Bobby Tesney
President and Chief Executive
Officer
Birmingham, Alabama
April 15, 1998
THIS IS AN IMPORTANT MEETING AND ALL SHAREHOLDERS ARE INVITED TO ATTEND THE
MEETING IN PERSON. ALL SHAREHOLDERS ARE RESPECTFULLY URGED TO EXECUTE AND
RETURN THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE. SHAREHOLDERS WHO
EXECUTE A PROXY CARD MAY NEVERTHELESS ATTEND THE MEETING, REVOKE THEIR PROXY
AND VOTE THEIR SHARES IN PERSON.
1998 ANNUAL MEETING OF SHAREHOLDERS
OF
WINSLOEW FURNITURE, INC.
_____________________________
PROXY STATEMENT
_____________________________
DATE, TIME AND PLACE OF ANNUAL MEETING
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of WinsLoew Furniture, Inc., a Florida corporation (the
"Company"), of proxies from the holders of the Company's common stock, par
value $.01 per share (the "Common Stock"), for use at the 1998 Annual Meeting
of Shareholders of the Company to be held at 9:00 a.m., local time, on
Tuesday, June 2, 1998, at The Grand Bay Hotel, 2669 South Bayshore Drive,
Miami, Florida, or at any adjournments or postponements thereof (the "Annual
Meeting"), pursuant to the foregoing Notice of Annual Meeting of Shareholders.
The approximate date that this Proxy Statement and the enclosed form of proxy
are first being sent to shareholders is April 15, 1998. Shareholders should
review the information provided herein in conjunction with the Company's 1997
Annual Report to Shareholders which accompanies this Proxy Statement. The
Company's principal executive offices are located at 201 Cahaba Valley
Parkway, Pelham, Alabama, and its telephone number is (205) 403-0206.
INFORMATION CONCERNING PROXY
The enclosed proxy is solicited on behalf of the Company's Board of
Directors. The giving of a proxy does not preclude the right to vote in person
should any shareholder giving the proxy so desire. Shareholders have an
unconditional right to revoke their proxy at any time prior to the exercise
thereof, either in person at the Annual Meeting or by filing with the
Company's Secretary at the Company's headquarters a written revocation or duly
executed proxy bearing a later date; however, no such revocation will be
effective until written notice of the revocation is received by the Company at
or prior to the Annual Meeting.
The cost of preparing, assembling and mailing this Proxy Statement, the
Notice of Annual Meeting of Shareholders and the enclosed proxy is to be borne
by the Company. In addition to the use of mail, employees of the Company may
solicit proxies personally and by telephone. The Company's employees will
receive no compensation for soliciting proxies other than their regular
salaries. The Company may request banks, brokers and other custodians,
nominees and fiduciaries to forward copies of the proxy material to their
principals and to request authority for the execution of proxies. The Company
may reimburse such persons for their expenses in so doing.
PURPOSES OF THE MEETING
At the Annual Meeting, the Company's shareholders will consider and vote
upon the following matters:
(1) The election of three members to the Company's Board of
Directors to serve until the Company's 2001 Annual Meeting of
Shareholders or until their successors are duly elected and
qualified; and
(2) Such other business as may properly come before the Annual
Meeting, including any adjournments or postponements thereof.
Unless contrary instructions are indicated on the enclosed proxy, all
shares represented by valid proxies received pursuant to this solicitation
(and which have not been revoked in accordance with the procedures set forth
above) will be voted for the election of the three nominees for director named
below. In the event that a shareholder specifies a different choice by means
of the enclosed proxy, such shareholder's shares will be voted in accordance
with the specification so made.
OUTSTANDING VOTING SECURITIES AND VOTING RIGHTS
The Board of Directors has set the close of business on April 6, 1998 as
the record date (the "Record Date") for determining shareholders of the
Company entitled to notice of and to vote at the Annual Meeting. As of March
16, 1998, there were 7,542,258 shares of Common Stock issued and outstanding,
all of which are entitled to be voted at the Annual Meeting. Holders of
Common Stock are entitled to one vote per share on each matter that is
submitted to shareholders for approval.
The attendance, in person or by proxy, of the holders of a majority of
the outstanding shares of Common Stock entitled to vote at the Annual Meeting
is necessary to constitute a quorum. Directors will be elected by a plurality
of the votes cast by the shares of Common Stock represented in person or by
proxy at the Annual Meeting. Any other matter that may be submitted to a vote
of the shareholders will be approved if the number of shares of Common Stock
voted in favor of the matter exceeds the number of shares voted in opposition
of the matter, unless such matter is one for which a greater vote is required
by law or by the Company's Articles of Incorporation or Bylaws. If less than a
majority of outstanding shares of Common Stock are represented at the Annual
Meeting, a majority of the shares so represented may adjourn the Annual
Meeting to another date, time or place, and notice need not be given of the
new date, time or place if the new date, time or place is announced at the
meeting before an adjournment is taken.
Prior to the Annual Meeting, the Company will select one or more
inspectors of election for the meeting. Such inspectors shall determine the
number of shares of Common Stock represented at the meeting, the existence of
a quorum and the validity and effect of proxies, and shall receive, count and
tabulate ballots and votes and determine the results thereof. Abstentions will
be considered as shares present and entitled to vote at the Annual Meeting and
will be counted as votes cast at the Annual Meeting, but will not be counted
as votes cast for or against any given matter. The inspectors of election
will treat shares referred to as "broker or nominee non-votes" that are
represented at the meeting (shares held by brokers or nominees as to which
instructions have not been received from the beneficial owners or other
persons entitled to vote and the broker or nominee does not have discretionary
voting power on a particular matter) as shares that are present and entitled
to vote for purposes of determining the presence of a quorum. For purposes of
determining the outcome of any matter as to which the proxies reflect broker
or nominee non-votes, shares represented by such proxies will be treated as
not present and not entitled to vote on that subject matter and therefore will
not be considered by the inspectors of election when counting votes cast on
the matter (even though those shares are considered entitled to vote for
quorum purposes and may be entitled to vote on other matters). Accordingly,
abstentions and broker or nominee non-votes will not have the same effect as a
vote against the election of any director.
SECURITY OWNERSHIP
The following table sets forth information regarding the beneficial
ownership of the Company's Common Stock as of March 16, 1998 by (i) each
person known by the Company to beneficially own more than five percent of the
outstanding shares of Common Stock, (ii) each director of the Company, (iii)
each "Named Executive Officer" of the Company (as defined below in "Executive
Compensation-Summary Compensation Table"), and (iv) all directors and
executive officers of the Company as a group:
Beneficial Ownership
Name of Beneficial Owner(1) of Common Stock(2)
Number of
Shares Percentage
Earl W. Powell(3)(4) 1,936,687 25.6%
Phillip T. George, M.D.(3)(5) 1,864,538 24.6%
Trivest Group, Inc.(3)(6) 908,455 12.0%
FMR Corp. (19) 752,400 9.9%
Trivest Special Situations
Fund 1985, L. P. (3)(7) 542,816 7.2%
Heartland Advisors, Inc.(8) 437,500 5.8%
R. Craig Watts (9) 160,737 2.1%
M. Miller Gorrie(10) 139,950 1.9%
Bobby Tesney(11) 114,793 1.5%
Stephen C. Hess(12) 76,202 1.0%
Vincent A. Tortorici, Jr. (13) 40,821 *
Peter W. Klein(3)(14) 10,750 *
James S. Smith(15) 30,500 *
Henry C. Cheek(16) 16,500 *
Sherwood M. Weiser(17) 13,175 *
William H. Allen, Jr.(18) 6,550 *
William F. Kaczynski Jr.(3) -- --
All directors and executive officers
as a group (14 persons)(20) 2,534,126 32.3%
______________________
(*) Less than 1%
(1) Except as otherwise indicated below, the address of each beneficial owner
is 201 Cahaba Valley Parkway, Pelham, Alabama 35124.
(2) Except as otherwise indicated below, all shares are owned directly and
each person has sole voting and investment power with respect to all
shares. For purposes of this table, a person is deemed to have
"beneficial ownership" of any shares as of a given date which the person
has the right to acquire within 60 days after such date. For purposes of
computing the outstanding shares held by each person named above on a
given date, any shares which such person has the right to acquire within
60 days after such date are deemed to be outstanding, but are not deemed
to be outstanding for the purpose of computing the percentage ownership
of any other person.
(3) The beneficial owner's address is 2665 South Bayshore Drive, Suite 800,
Miami, Florida 33133.
(4) Includes 199,135 shares owned directly, 34,125 shares subject to
exercisable options granted under the Company's stock option plan,
662,484 shares held of record by Trivest Fund I, Ltd., 245,971 shares
held of record by Trivest Equity Fund I, Ltd., 116,459 shares held of
record by Trivest Principals' Fund 1988, of which Mr. Powell is a general
partner, 542,816 shares owned of record by Trivest Special Situations
Fund 1985, L.P. ("TSSF") (see note (7)) and 135,697 shares owned of
record by Trivest Annuity Fund, Ltd.("Annuity Fund") . The General
Partner of Annuity Fund is Trivest Plan Sponsor. Messrs. Powell and
George are executive officers and directors of Trivest Plan Sponsor and
beneficially own 100% of its outstanding stock.
(5) Includes 129,461 shares owned directly, 900 shares held of record by Dr.
George as custodian for his minor children under the Florida Uniform
Gifts to Minors Act as to which Dr. George disclaims beneficial
ownership, 30,750 shares subject to exercisable options under the
Company's stock option plan, 662,484 shares held of record by Trivest
Fund I, Ltd., 245,971 shares held of record by Trivest Equity Partners I,
Ltd., 116,459 shares held of record by Trivest Principals' Fund 1988, of
which Dr. George is a general partner, 542,816 shares of record owned by
TSSF (See note (7)), and 135,697 shares owned of record by Annuity Fund.
The General Partner of Annuity Fund is Trivest Plan Sponsor. Messrs.
Powell and George are executive officers and directors of Trivest Plan
Sponsor and beneficially own 100% of its outstanding stock.
(6) Trivest Group, Inc. serves as the sole general partner of Trivest 1988
Fund Managers, Ltd., which in turn is the sole general partner of (i)
Trivest Fund I, Ltd., a privately held investment partnership that holds
of record 662,484 shares of Common Stock, and (ii) Trivest Equity
Partners I, Ltd., a privately held investment partnership that holds of
record 245,971 shares of Common Stock Messrs. Powell and George are
executive officers and directors of Trivest Group, Inc. and beneficially
own 100% of its outstanding capital stock.
(7) The general partner of TSSF is Trivest Associates, L.P. ("Associates"), a
Florida limited partnership whose general partner is Trivest, Inc.
Messrs. Powell and George are executive officers and directors of Trivest
Group, Inc. and beneficially own 100% of its outstanding capital stock.
Messrs. Powell and George are also limited partners of Associates.
(8) The address for Heartland Advisors, Inc. is 790 North Milwaukee Street,
Milwaukee, Wisconsin 53202.
(9) Includes 110,562 shares owned directly and 50,175 shares subject to
exercisable options granted under the Company's Stock Option Plan. Mr.
Watts' address is 1801 N. Andrews Extension, Pompano Beach, Florida
33061.
(10) Includes 50,750 shares owned directly and 10,500 shares subject to
exercisable options granted under the Company's stock option plan and
78,700 shares owned by Brasfield & Gorrie, General Contractors,
Incorporated. Mr. Gorrie's address is c/o Brasfield and Gorrie, 729
South 30th Street, Birmingham, Alabama 35223.
(11) Includes 49,793 shares owned directly and 65,000 shares subject to
exercisable options granted under the Company's stock option plan.
(12) Includes 31,202 shares owned directly and 45,000 shares subject to
exercisable options granted under the Company's stock option plan.
(13) Includes 15,821 shares owned directly and 25,000 shares subject to
exercisable options granted under the Company's stock option plan.
(14) Represents 10,750 shares subject to exercisable options granted under the
Company's stock option plan.
(15) Includes 20,000 shares owned directly and 10,500 shares subject to
exercisable options granted under the Company's stock option plan. Mr.
Smith's address is Suite 916, 10 Rockefeller Plaza, New York, New York
10020.
(16) Includes 6,000 shares owned directly and 10,500 shares subject to
exercisable options granted under the Company's stock option plan. Mr.
Cheek's address is 3713 Fairway Drive, DCBE, Granbury, Texas 76049.
(17) Represents 5,675 shares held by Mr. Weiser's wife, 2,000 shares owned
directly and 5,500 shares subject to exercisable options granted under the
Company's stock option plan. Mr. Weiser's address is 3250 Mary Street,
5th Floor, Miami, Florida 33133.
(18) Represents 1,050 shares owned directly and 5,500 shares subject to
exercisable options granted under the Company's stock option plan. Mr.
Allen's address is c/o Nations Bank South, 200 S.E. 1st Street, Suite
800, Miami, Florida 33131.
(19) The address for FMR Corp. is 82 Devonshire Street, Boston,
Massachusetts 02109.
(20) Includes an aggregate of 309,450 shares subject to exercisable options
granted under the Company's stock option plan, 1,024,914 shares owned of
record by Trivest Fund I, Ltd., Trivest Equity Fund I, Ltd., and Trivest
Principals' Fund 1988 and 678,513 shares owned of record by TSSF and
Annuity Fund. See notes (4), (5), (6) and (7).
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than ten
percent of the Company's Common Stock, to file with the Securities and
Exchange Commission (the "SEC") initial reports of ownership and reports of
changes in ownership of Common Stock. Such persons are required by SEC
regulation to furnish the Company with copies of all such reports they file.
To the Company's knowledge, based solely on a review of the copies of
such reports furnished to the Company and written representations that no
other reports were required, all Section 16(a) filing with respect to the
Company's 1997 fiscal year were timely made.
ELECTION OF DIRECTORS; DIRECTOR NOMINEES
The Company's Articles of Incorporation provide that the Company's Board
of Directors shall consist of not less than seven nor more than thirteen
members, with the exact number to be fixed from time to time by resolution of
the Board of Directors. The Board has fixed the number of directors on the
Board at ten for the ensuing year.
The Company's Articles of Incorporation divide the Board of Directors
into three classes (Classes I, II and III). The term of office of Class I
directors expires at the Annual Meeting. The current directors of the Company
and their respective Classes and terms of office are as follows:
Director Class Term Expires At
- ----------------------- ----- -------------------
Earl W. Powell I 1998 Annual Meeting
William H. Allen, Jr. I 1998 Annual Meeting
James S. Smith I 1998 Annual Meeting
Phillip T. George, M.D. II 1999 Annual Meeting
Peter W. Klein II 1999 Annual Meeting
Bobby Tesney II 1999 Annual Meeting
Sherwood M. Weiser II 1999 Annual Meeting
William F. Kaczynski, Jr. III 2000 Annual Meeting
Henry C. Cheek III 2000 Annual Meeting
M. Miller Gorrie III 2000 Annual Meeting
Accordingly, three Class I directors are to be elected at the Annual
Meeting, for a term expiring at the Company's 2001 Annual Meeting of
Shareholders. The Company's current Class I directors, Messrs. Powell, Allen
and Smith have been nominated by the Board to be re-elected as Class I
directors at the Annual Meeting. The Board of Directors has no reason to
believe that any of such nominees will refuse or be unable to accept election;
however, in the event that any of the nominees is unable to accept election or
if any other unforeseen contingencies should arise, each proxy that does not
direct otherwise will be voted for the remaining nominees and for such other
replacement nominees as may be designated by the Board of Directors.
MANAGEMENT
Executive Officers and Directors
The executive officers and directors of the Company are as follows:
Name Age Position
Earl W. Powell 59 Chairman of the Board
Bobby Tesney 53 President, Chief Executive
Officer and Director
R. Craig Watts 44 Executive Vice President
Contract Seating
Stephen C. Hess 49 Executive Vice President
Casual Furniture
Vincent A. Tortorici, Jr. 44 Vice President and Chief
Financial Officer
William F. Kaczynski, Jr. 38 Director
Phillip T. George, M.D. 58 Director
Peter W. Klein 42 Director
William H. Allen, Jr. 62 Director
Sherwood M. Weiser 67 Director
M. Miller Gorrie 62 Director
James S. Smith 69 Director
Henry C. Cheek 72 Director
The Company was formed in September 1994, and in December 1994 the
Company merged with each of Winston Furniture Company, Inc. ("Winston") and
Loewenstein Furniture Group, Inc. ("Loewenstein"). Each of the Company's
directors and executive officers were also directors or officers of Winston
and/or Loewenstein, as described below. Prior to the merger, each of Winston
and Loewenstein were publicly held corporations whose common stock traded on
the NASDAQ National Market.
Mr. Powell, Chairman of the Board of the Company since October 1994,
serves as President and Chief Executive Officer of Trivest, Inc. ("Trivest"),
a private investment firm specializing in management services and
acquisitions, dispositions and leveraged buyouts, which was formed by Messrs.
Powell and George in 1981. Mr. Powell has also served as Chairman of the
Board of Atlantis Plastics, Inc., an American Stock Exchange company whose
subsidiaries are engaged in the plastics industry ("Atlantis"), since founding
that company in February 1984, as Chief Executive of Atlantis from its
organization until February 1995 and as President of Atlantis from November
1993 to February 1995. Mr. Powell has served as Chairman of the Board of
Biscayne Apparel, Inc., an American Stock Exchange company whose principal
subsidiaries are engaged in the apparel industry ("Biscayne"), since October
1985 and presently serves as Chief Executive Officer of Biscayne. Mr. Powell
also served as Chairman of the Board of Winston from December 1988 to
December 1994, Chairman of the Board of Loewenstein from February 1985 to
December 1994 and as Loewenstein's President and Chief Executive Officer from
May 1994 to December 1994. From 1971 until 1985, Mr. Powell was a partner
with KPMG Peat Marwick, Certified Public Accountants ("Peat Marwick"), where
his positions included serving as managing partner of Peat Marwick's Miami
office.
Mr. Tesney, President, Chief Executive Officer and a director of the
Company since October 1994, served as President, Chief Executive Officer and a
director of Winston from December 1993 to December 1994, General Manager of
Winston from 1985 to December 1993 and as Senior Vice President-Operations of
Winston from January to December 1993. Mr. Tesney also served as Vice
President of Winston from 1979 until January 1992.
Mr. Watts, Executive Vice President-Contract Seating of the Company
since October 1994, served as a director of Loewenstein from December 1990 to
December 1994, and was appointed Loewenstein's Executive Vice President-
Contract Seating in May 1993, after serving as Vice President since May 1991.
Mr. Watts also serves as the President and Chief Operating Officer of the
Company's Loewenstein and Gregson divisions, and has served in a number of
management positions since joining Loewenstein in April 1981.
Mr. Hess, the Company's Executive Vice President-Casual Furniture since
October 1994, served as Winston's Executive Vice President from December 1993
to December 1994, Winston's Senior Vice President-Marketing and Sales from
January 1992 to September 1993, and as Winston's Vice President-Marketing and
Sales from January 1983 until January 1992.
Mr. Tortorici, the Company's Vice President and Chief Financial Officer
since October 1994, served as Winston's Vice President-Finance and
Administration and Chief Financial Officer from March 1988 to December 1994.
Mr. Tortorici is a certified public accountant and was employed by Arthur
Andersen & Co. from 1976 until March 1988.
Mr. Kaczynski was elected director of the Company in January 1998. He
joined Trivest in January 1998, as Senior Vice President. From July 1996
until December 1997, he was Chief Financial Officer of WebSite Management
Company, Inc. d/b/a FlashNet Communications, an Internet service provider.
From May 1994 until July 1996, he was Chief Financial Officer of Colorado
Mountain Express, Inc., an airport transportation company. Prior to that he
was with Heller Financial, Inc. from 1986 until 1994, most recently as Senior
Vice President - Corporate Finance Group, Dallas, Texas.
Dr. George, a director of the Company since October 1994, served as a
director of Winston from October 1989 to December 1994 and as a director of
Loewenstein from February 1985 to December 1994. Dr. George also serves as
the Chairman of the Board of Trivest, the Vice Chairman of the Board and
Chairman of the Executive Committee of the Board of Directors of Atlantis, and
as a Director of Biscayne. Dr. George's executive position with Trivest has
been his principal occupation since retiring from the private practice of
plastic and reconstructive surgery in February 1986.
Mr. Klein, a director of the Company since October 1994, served as a
director of Winston from December 1988 to December 1994 and as a director of
Loewenstein from May 1993 to December 1994. Mr. Klein has served as an
executive officer of Trivest since May 1986 and is presently Senior Vice
President, Managing Director and General Counsel of Trivest. Prior to joining
Trivest, Mr. Klein practiced law in Chicago, Illinois and Cleveland, Ohio.
Mr. Allen, a director of the Company since October 1994, served as a
director of Loewenstein from September 1993 to December 1994. Mr. Allen
serves as Vice Chairman of NationsBank South, and served as Chairman of the
Board and Chief Executive Officer of Intercontinental Bank, a NASDAQ National
Market company headquartered in Miami, Florida, since April 1987 until its
merger with NationsBank South in December 1994. Mr. Allen also serves as a
director of American Bankers Insurance Group, a NASDAQ National Market company
headquartered in Miami, Florida and Decorator Industries, Inc., traded on the
American Stock Exchange, headquartered in Hollywood, Florida.
Mr. Weiser, a director of the Company since October 1994, has been,
since 1970, the Chairman of the Board, President and Chief Executive Officer
of CHC International, Inc., a leading hotel and casino development and
management company that does business as "Carnival Hotels and Casinos," and
its predecessors. Mr. Weiser also serves as a director of Carnival
Corporation, a cruise line traded on the New York Stock Exchange.
Mr. Gorrie, a director of the Company since October 1994, served as a
director of Winston from February 1993 to December 1994 and from May 1986 to
December 1988. Mr. Gorrie has been President of Brasfield & Gorrie General
Contractor, Inc., a diversified general contractor based in Birmingham,
Alabama, since 1964. Mr. Gorrie also serves as a director of AmSouth
Bancorporation, a New York Stock Exchange company which is the holding company
of AmSouth Bank of Alabama. Mr. Gorrie is a director of Colonial Properties
Trust, a real estate investment trust traded on the New York Stock Exchange.
Mr. Smith, a director of the Company since October 1994, served as a
director of Winston from February 1993 to December 1994, and as a director of
Biscayne from June 1986 to February 1992. Mr. Smith has been engaged in
private investment activities as his principal occupation for more than the
prior five years. Mr. Smith served as Executive Vice President of Stephens,
Inc., an investment banking firm based in Little Rock, Arkansas, from January
1985 until May 1987. Mr. Smith has also served as President of the Arnold D.
Frese Foundation since March 1979.
Mr. Cheek, a director of the Company since October 1994, served as a
director of Winston from February 1993 to December 1994. Mr. Cheek has been
engaged in private investment activities as his principal occupation for more
than the prior five years. From 1951 until his retirement in 1984, Mr. Cheek
was Vice President of U.S. Industries, Inc., a diversified holding company and
served as Chief Executive Officer of its Furniture Group. Mr. Cheek served as
a director of Winston from May 1987 through December 1988.
Meetings and Committees of the Board of Directors
During 1997, the Board of Directors held four meetings and took certain
actions by written consent. During 1997, except for Mr. Weiser, no director
attended fewer than 75 percent of the aggregate of (i) the number of meetings
of the Board of Directors held during the period he served on the Board, and
(ii) the number meetings of committees of the Board of Directors held during
the period he served on such committees.
During 1997, Messrs. Smith, Allen and Weiser served as members of the
Compensation Committee and took certain actions by written consent. Mr. Smith
is Chairman of the Compensation Committee. The authority and responsibilities
of the compensation Committee include (i) establishing compensation policies
with respect to the Company's executive officers, (ii) making recommendations
to the full Board on compensation actions involving the Company's executive
officers, including actions regarding salary, bonus and employment agreements,
(iii) approving long term incentive awards for executive officers, and (iv)
administering the Company's stock option plan and other incentive and long-
term compensation plans maintained by the Company from time to time.
During 1997, Messrs. Gorrie and Cheek served as members of the Audit
Committee. Mr. Gorrie is Chairman of the Audit Committee. The authority and
responsibilities of the Audit Committee include (i) recommending to the full
Board the appointment of the Company's auditors and any termination of
engagement, (ii) reviewing the plan and scope of audits, (iii) reviewing the
Company's significant accounting policies and internal controls, and (iv)
having general responsibility for all related auditing matters.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth compensation awarded to, earned by or
paid to the Company's Chief Executive Officer, and each of the Company's other
executive officers whose total 1997 salary and bonus from the Company was
$100,000 or more (the Chief Executive Officer and such other executive officer
are referred to herein as the "Named Executive Officers").
Long Term
Compensation
------------
Annual Compensation Awards
Name and Fiscal Other Annual Number of
Principal Position Year Salary Bonus Compensation Options
(1) Granted
- ----------------------- ---- -------- -------- ------------ --------
Bobby Tesney 1997 $245,000 $183,000 $49,221 40,000
President and 1996 216,400 162,300 28,240 -
Chief Executive Officer 1995 200,000 127,500 - 50,000
Stephen C. Hess 1997 200,000 150,000 20,935 30,000
Executive Vice President 1996 178,218 133,663 18,606 -
Casual Furniture 1995 165,000 100,000 - 25,000
Vincent A. Tortorici, Jr. 1997 145,000 72,500 12,669 25,000
Vice President and Chief 1996 129,900 64,950 8,718 -
Financial Officer 1995 120,000 51,000 - 25,000
R. Craig Watts 1997 181,830 136,373 19,343 25,000
Executive Vice President 1996 166,138 121,103 20,357 -
Contract Seating 1995 150,052 40,506 - 25,000
Richard McLeod (2) 1997 140,897 - 1,737 10,000
Executive Vice President - 1996 129,536 - 2,019 -
Futons 1995 22,115 - - -
________________________
(1) "Other Annual Compensation" represents amount paid by the Company on
behalf of the Named Executive Officer under the Company's Non-Qualified
Supplemental Executive Retirement Plan established in October 1996.
Under the terms of this Plan, selected employees make after-tax
contributions of their salary to one or more investment alternatives
available under such Plan. The Company then matches the employee
contribution (up to 10% of compensation on an after-tax basis) depending
on the employee's length of service (up to 50% for 15 years of
continuous service). The employee is vested at all times in the
deferred compensation and is vested immediately in the matching
contribution.
(2) Mr. McLeod was employed by the Company from September 1995 until January
1998.
Option Grants Table
The following table sets forth information concerning the grant of stock
options to the Named Executive Officers in 1997 under the Company's Amended
and Restated 1994 Stock Option Plan.
Options Grants In Last Fiscal Year
Individual Grants
Name A B C D E F
- -------------------- ------ ---- ------ ------- -------- -------
Bobby Tesney 40,000 24.2 $10.50 6/10/07 $264,136 $669,372
Stephen C. Hess 30,000 18.1 $10.50 6/10/07 198,102 502,029
Vincent A. Tortorici 25,000 15.2 $10.50 6/10/07 165,085 418,357
R. Craig Watts 25,000 15.2 $10.50 6/10/07 165,085 418,357
Richard McLeod 10,000 6.1 $10.50 6/10/07 66,034 167,343
A= Options Granted (1)
B= % of Total Options Granted to Employees in Fiscal Year
C= Exercise Price
D= Expiration Date
E= Potential Realizable Value at Assumed Annual Rates of Stock Price
Appreciation for Option Terms at 5%($) (2)
F= Potential Realizable Value at Assumed Annual Rates of Stock Price
Appreciation for Option Terms at 10%($) (2)
(1) The options become exercisable for 20% of the shares on the first
anniversary of the date of grant and for the balance in equal annual
installments over the four-year period thereafter, so long as employment with
Company or one of its subsidiaries continues. To the extent not already
exercisable, the options generally become fully exercisable upon liquidation
or dissolution of the Company, a sale or other disposition of all or
substantially all of the Company's assets, or a merger or consolidation
pursuant to which either (i)the Company does not survive, or (ii) ownership of
more than 49% of the voting power of the Company's voting stock is
transferred. In addition, the Compensation Committee of the Board of
Directors may, in its discretion, accelerate the date on which any option may
be exercised, and may accelerate the vesting of any shares subject to any
option.
(2) Based on assumed annual rates of stock price appreciation from the
closing price of the Company's Common Stock on the date of grant. These
amounts represent assumed rates of appreciation only. Actual gains, if any,
on stock option exercises and Common Stock holdings are dependent on the
future performance of the Common Stock and overall stock market conditions.
Aggregated 1997 Fiscal Year-End Option Value Table
The following table sets forth certain information concerning
unexercised stock options held by the Named Executive Officers as of December
31, 1997. No stock options were exercised by such persons during 1997.
Number of Value of
Securities Underlying Unexercised In-The
Unexercised Options Money Options
at December 31, 1997 at Decmeber 31, 1997
--------------------------- -------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ------------------------ ----------- ------------- ----------- -------------
Bobby Tesney 55,000 70,000 $270,625 $415,000
Stephen C. Hess 40,000 45,000 171,250 247,500
Vincent A. Tortorici, Jr. 20,000 40,000 113,750 227,500
R. Craig Watts 45,175 40,000 295,735 227,500
Richard McLeod -- 10,000 -- 40,000
401 (k) Plan
Effective January 1, 1997, the WinsLoew Furniture, Inc. 401 (k) Plan was
established. Employees of the Company and its subsidiaries are eligible to
participate in the Plan following the later to occur of (i) the employee's
completion of one year of service or (ii) the employee's 21st birthday.
Eligible employees may make a salary reduction contributions to the Plan on a
pretax basis. For each calendar year, the Company and the other participating
employees may make matching contributions to the Plan based on a discretionary
matching percentage to be determined each year by the Company. In addition,
the Company and the other participating employers may make a discretionary
profit sharing contribution to the plan on behalf of each participant who
completes more than 500 hours of service during the year or who is employed
on the last day of the year. This latter contribution is allocated
proportionately based on each participants compensation. An employee's vested
benefits are payable upon his retirement, death, disability, or other
termination of employment or upon the attainment of age 59-1/2. An employee
is always fully vested in his account balance attributable to his won
contributions to the Plan. The employee's interest in the account
attributable to his employers contributions and earnings thereon becomes fully
vested upon the earlier of the attainment of his normal retirement date (age
65), his death, his permanent and total disability, or his completion of six
years of service. If an employee terminates employment for reasons other than
retirement, death, or disability, his vested interest is based on a graduated
vesting schedule which provides for 20% vesting after two years of service and
20% for each year thereafter. Nonvested amounts are forfeited.
Long Term Incentive and Pension Plans
The Company has no Long Term Incentive or Pension Plans.
Compensation of Directors
During 1996 and the first quarter of 1997, the Company paid each
director who was neither an employee of the Company nor Trivest an annual
retainer of $10,000, an additional retainer of $2,500 for serving on the
Compensation Committee, a $500 fee for each meeting of the Board of Directors
attended and, unless held on the same day as a Board meeting, $500 for each
committee meeting attended. The Company also reimburses all directors for
expenses incurred in connection with their activities as directors.
Additionally, prior to 1997, on March 31 of each year, each director
who was neither an employee of the Company nor Trivest received automatic
grants of options to purchase 5,000 shares of Common Stock pursuant to the
Company's 1994 Stock Option Plan. Such options become exercisable at the rate
of 20% per year on each anniversary of the date of grant, and have an exercise
price equal to the fair market value of Common Stock on the date of grant.
The unexercised portion of any such option will terminate upon the earliest to
occur of the following: (i) the expiration of 10 years from the date of grant
of the option, (ii) twelve months after the date on which the optionee ceases
to be a director by reason of the death or disability of the optionee, or
(iii) three months after the optionee ceases to be a director for any other
reason. In addition, each other director of the Company is eligible to
receive discretionary grants of options pursuant to such plan. These
automatic grants were terminated in connection with the adoption of the
Amended and Restated 1994 Stock Option Plan by the Board of Directors in
January 1997.
The Board of Directors approved new compensation policies effective
April 1, 1997. Directors who are neither employees of the Company or Trivest
are paid a $2,500 cash fee for each meeting attended in person and a $500 cash
fee for each meeting attended by telephone. In addition, each member of the
Compensation and Audit Committee receives a $2,500 annual retainer, payable
quarterly in advance.
In addition, during 1997 each of the Company's directors was granted
options to purchase 2,500 shares of Common Stock pursuant to the Company's
Amended and Restated 1994 Stock Option Plan for each meeting of the Board of
Directors attended by him. There were four meetings of the Board of Directors
in 1997. Such options become exercisable at the rate of 20% per year on each
anniversary of the date of grant and have an exercise price equal to the fair
market value of the Common Stock on the date of grant. The unexercised
portion of such options will terminate on the earliest to occur of the
following (i) the expiration of 10 years from the date of grant of the option,
(ii) twelve months after the date on which the optionee ceases to be a
director by reason of the death or disability of the optionee, or (iii) except
as otherwise may be determined by the Board, three months after the date on
which the optionee ceases to be a director for any other reason. The unvested
portion of the foregoing options will become fully vested in the event of a
change in control of the Company.
Employment Contracts, Termination of Employment and Change in Control
Arrangements
Effective January 1, 1995, the Company entered into five-year employment
agreements with each of Messrs. Tesney, Watts, Hess and Tortorici. The
employment agreements provide for the Company to pay Messrs. Tesney, Watts,
Hess and Tortorici base salaries of $200,000, $150,000, $165,000 and $120,000,
respectively, in each case subject to annual cost of living adjustments. Such
employment agreements also provide for annual incentive compensation payments
of up to 75% of the executive's then base salary (50% in the case of Mr.
Tortorici) based on the operating earnings (adjusted to exclude the effect of
goodwill amortization) of (i) the Company, in the case of Messrs. Tesney and
Tortorici, (ii) the Company's Contract Seating divisions, in the case of
Mr. Watts,) and (iii) the Company's Casual Furniture divisions, in the case of
Mr. Hess. None of such officers will receive any incentive compensation
payment under his employment agreement for any particular year unless the
relevant operating earnings for such year are at least 75% of the "target
earnings" for such year. Target earnings for 1997 were set by the
Compensation Committee of the Board. Each employment agreement also provides
that the executive will receive six months base salary if his employment is
terminated without "cause" (as defined), and prohibits the executive from
directly or indirectly competing with the Company for one year after
termination of his employment (six months if he is terminated by the Company
without "cause"). Such employment agreements were approved by the
Compensation Committee of the Company's Board of Directors.
Each of the Named executive Officers holds options to purchase Common
Stock under the company's Amended and restated 1994 Stock Option Plan. To the
extent not already exercisable, such options generally become exercisable upon
(I) a reorganization, merger, consolidation or other form of corporate
transaction with respect to which ownership of a majority of the voting power
of the Common Stock is transferred, (ii) liquidation or dissolution of the
Company or (iii) the sale of all or substantially all of the Company's assets.
Compensation Committee Interlocks and Insider Participation
Mr. Powell, the Company's Chairman, also serves on the Board of
Directors of CHC International, Inc., a hotel and casino development and
management company. Mr. Weiser, a director and member of the Compensation
Committee of the Company, serves as Chairman of the Board, President and Chief
Executive Officer of CHC International, Inc. See "Management."
Compensation Committee Report on Executive Compensation
The Compensation Committee's general philosophy with respect to the
compensation of the Company's executive officers is to offer competitive
compensation programs designed to attract and retain key executives critical
to the long-term success of the Company and to recognize an individual's
contribution and personal performance. The components of such compensation
programs include a base salary and annual bonus, a supplemental nonqualified
retirement plan and a stock option plan designed to provide long-term
incentives.
In November 1994, the Compensation Committee approved the Company's
employment agreements with each of Messrs. Tesney, Watts, Hess and Tortorici.
Compensation pursuant to such agreements commenced in January 1995. The
agreements provide for, among other things, annual incentive compensation
payments, the amounts of which are directly related to earnings of the Company
or specified divisions of the Company. See "-Employment Contracts,
Termination of Employment and Change in Control Arrangements" for a
description of the terms of such agreements.
The Company's stock option plan is administered by the Compensation
Committee (with respect to all eligible persons except directors) and is
designed to attract and retain executive officers and other employees of the
Company and its subsidiaries, and to reward them for their successful efforts
to deliver growth in value to the Company's shareholders. The stock option
plan provides for discretionary grants of options to selected eligible
persons.
In 1997, the Compensation Committee approved fair market value option
grants for Mr. Tesney (options to purchase 40,000 shares of Common Stock) and
the other Named Executive Officers (option to purchase, in the aggregate,
90,000 shares of Common Stock). The Compensation Committee believes that the
number of shares covered by such grants reflect competitive practices for
companies with similar market capitalizations as the Company.
WILLIAM H. ALLEN, JR.
JAMES S. SMITH
SHERWOOD M. WEISER
PERFORMANCE GRAPH
The following graph compares the cumulative total shareholder returns on
the Company's Common Stock, based on the market price of Common Stock from
December 19, 1994 (the date upon which public trading of the Common Stock
commenced) through December 31, 1997, with (i) the NASDAQ market index, and
(ii) the Media General Furniture and Home Furnishings Index.
COMPARISON OF CUMULATIVE TOTAL RETURN
December 19, December
1994 1995 1996 1997
------ ------ ------ ------
WinsLoew Furniture, Inc. 100.00 102.17 169.57 252.17
NASDAQ Stock Market Index 100.00 129.71 161.18 197.16
Media General Furniture and
Home Furnishings Index 100.00 101.82 124.53 149.05
CERTAIN TRANSACTIONS
Investment Services Agreement. In December 1994, the Company entered
into a ten-year investment Services Agreement with Trivest (the "Investment
Services Agreement), pursuant to which Trivest provides corporate finance,
strategic and capital planning and other management advice to the Company,
including (i) conducting relations on behalf of the Company with accountants,
attorneys, financial advisors and other professionals, (ii) providing reports
to the Company with respect to the value of its assets, and (iii) rendering
advice with respect to acquisitions, dispositions, financings and
refinancings. Pursuant to the Investment Services Agreement, Trivest receives
a base annual fee of $500,000 (in 1994), subject to cost-of-living increases.
In addition, for each additional business acquired by the Company, Trivest's
base compensation will generally be increased by the greater of (i) $100,000,
and (ii) the sum of 5% of the additional business's projected annual earnings
before income taxes, interest expense and amortization of goodwill ("EBITA")
for the fiscal year in which it is acquired up to $2.0 million of EBITA, plus
3.5% of EBITA in excess of $2.0 million. Moreover, subject to the approval of
the Company's board (including a majority of disinterested directors), for
each acquisition or disposition of any business operation by the Company
introduced or negotiated by Trivest, Trivest will generally receive a fee of
up to 3% of the purchase price. The Company paid Trivest $628,412 for
services rendered under the Investment Services Agreement during 1997.
Trivest Legal Department. Trivest maintains an internal legal
department. The Trivest legal department accounts for its time on an hourly
basis and bills Trivest and its affiliates, including the Company, for
services rendered at prevailing rates. In 1997, the company paid Trivest
$55,762 for services rendered by the Trivest legal department. The Company
believes that the fees charged by the Trivest legal department in 1997 were no
less favorable to the Company than fees charged by unaffiliated third parties
for similar services.
RELATIONSHIP WITH INDEPENDENT AUDITORS
The firm of Ernst & Young LLP, independent auditors, served as the
Company's independent auditors for the fiscal year ended December 31, 1997.
Such representatives will have the opportunity to make a statement if they
desire to do so.
OTHER BUSINESS
The Board knows of no other business to be brought before the Annual
Meeting. If, however, any other business should properly come before the
Annual Meeting, the persons named in the accompanying proxy will vote proxies
as in their discretion they may deem appropriate, unless they are directed by
a proxy to do otherwise.
INFORMATION CONCERNING SHAREHOLDER PROPOSALS
Pursuant to Rule 14a-8 promulgated by the Securities and Exchange
Commission, a shareholder intending to present a proposal to be included in
the Company's proxy statement for the Company's 1999 Annual Meeting of
Shareholders must deliver a proposal in writing to the Company's principal
executive offices no later than December 24, 1998.
By Order Of The Board Of Directors
/S/Bobby Tesney
-----------------
Bobby Tesney
President and Chief Executive Officer
Pelham, Alabama
April 15, 1998
COMMON STOCK PROXY FOR 1998 ANNUAL MEETING OF SHAREHOLDERS
WINSLOEW FURNITURE, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned holder of shares of Common Stock of WINSLOEW FURNITURE,
INC., a Florida corporation (the "Company"), hereby appoints Earl W. Powell
and Phillip T. George, M.D., and each of them, as proxies for the undersigned,
each with full power of substitution, and hereby authorizes them to represent
and to vote, as designated on the reverse side of this proxy card, all shares
of Common Stock of the Company which the undersigned is entitled to vote at
the Annual Meeting of Shareholders of the Company to be held at The Grand Bay
Hotel, 2669 South Bayshore Drive, Miami, Florida 33133 at 9:00 A.M., local
time, on Tuesday June 2, 1998, and at all adjournments and postponements
thereof.
(To be signed on the other side)
(see reverse side)
(continued from other side)
The Board of Directors recommends a vote FOR the election of all of the
director nominees listed in proposal 1. below.
1. ELECTION OF DIRECTORS.
Election of: William H. Allen, Jr.
Earl W. Powell
James J. Smith
VOTE FOR all nominees listed above, except that vote is withheld
with respect to each nominee, if any, whose name is marked
through above.
VOTE WITHHELD with respect to all nominees listed above.
2. The proxies are authorized to vote, in their discretion, upon such
other business as may properly come before the Annual Meeting and
any adjournments or postponements thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
"FOR" THE ELECTION OF ALL DIRECTOR NOMINEES LISTED IN PROPOSAL 1. ABOVE.
The undersigned hereby acknowledges receipt of (i) the Notice of Annual
Meeting and related Proxy Statement for the 1998 Annual Meeting, and (ii) the
Company's 1997 Annual Report to Shareholders.
Dated:_________________________________, 1998
(Signature)
(Signature if held jointly)
IMPORTANT: Please sign exactly as your name appears hereon and mail it
promptly even though you now plan to attend the meeting. When shares are held
by joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
PLEASE MARK, SIGN AND DATE THIS PROXY CARD AND PROMPTLY RETURN IT IN THE
ENVELOPE PROVIDED. NO POSTAGE IS NECESSARY IF MAILED IN THE UNITED STATES.
