<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-
6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
STANHOME INC.
__________________________________________________________________________
(Name of Registrant as Specified In Its Charter)
__________________________________________________________________________
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
1) Title of each class of securities to which transaction applies:
______________________________________________________
2) Aggregate number of securities to which transaction applies:
______________________________________________________
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
______________________________________________________
4) Proposed maximum aggregate value of transaction:
______________________________________________________
5) Total fee paid:
______________________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
______________________________________________________
2) Form, Schedule or Registration Statement No.:
______________________________________________________
3) Filing Party:
______________________________________________________
4) Date Filed:
______________________________________________________
<PAGE>
STANHOME INC.
333 WESTERN AVENUE
WESTFIELD, MASSACHUSETTS 01085
________________________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
April 24, 1997
Notice is hereby given that the Annual Meeting of Stockholders of
Stanhome Inc. will be held at the principal executive offices of the
Company at 333 Western Avenue, Westfield, Massachusetts 01085, at 9:30 a.m.
on Thursday, April 24, 1997, for the following purposes:
1. To elect three Class II Directors for a three-year term.
2. To ratify the appointment by the Board of Directors of Arthur
Andersen LLP as independent accountants for 1997.
3. To vote upon a stockholder proposal described in this proxy
statement, if the proposal is presented at the meeting.
4. To transact such other business as may properly come before the
meeting and any postponement or adjournment thereof.
Stockholders of record as of the close of business on February 28,
1997 will be entitled to vote at the Annual Meeting and any postponement or
adjournment thereof.
By Order of the Board of Directors,
BRUCE H. WYATT, Clerk
Westfield, Massachusetts
March 14, 1997
________________________________________
IMPORTANT
All stockholders are cordially invited to attend the meeting.
Whether or not you plan to attend in person, you are urged to complete,
date and sign the enclosed proxy card and return it promptly in the
envelope provided. This will assure your representation and a quorum for
the transaction of business at the meeting. If you do attend the meeting,
you may vote in person, if you desire to do so, even if you have returned a
proxy card.
<PAGE>
STANHOME INC.
PROXY STATEMENT
March 14, 1997
SOLICITATION AND REVOCATION OF PROXIES
The accompanying proxy is solicited by the Board of Directors for use
at the Annual Meeting of Stockholders of Stanhome Inc. (the "Company") to
be held at 9:30 a.m. on Thursday, April 24, 1997, at the principal
executive offices of the Company, 333 Western Avenue, Westfield,
Massachusetts 01085. Any proxy given pursuant to this solicitation may be
revoked by the person giving it at any time before it is voted. Proxies
may be revoked by (i) filing with the Clerk, at or before the 1997 annual
meeting of stockholders (the "Annual Meeting"), a written notice of
revocation bearing a later date than the proxy; (ii) duly executing and
submitting a subsequent proxy relating to the Annual Meeting; or (iii)
voting in person at the Annual Meeting (although attendance at the Annual
Meeting will not, in and of itself, constitute a revocation of a proxy).
Any written notice revoking a proxy should be sent to Bruce H. Wyatt,
Clerk, Stanhome Inc., 333 Western Avenue, Westfield, Massachusetts 01085.
The expense of solicitation of proxies will be borne by the Company.
The Company has retained Morrow & Co., New York, New York, to aid in the
solicitation of proxies. It is estimated that the cost of these services
will be approximately $6,500 plus expenses. Proxies will be solicited by
personal interview, mail, and telephone. Brokerage houses, other
custodians and nominees will be asked whether other persons are the
beneficial owners of the Company's common stock, par value $.125 per share,
together with the associated common stock purchase rights (the "Common
Stock"), which they hold of record, and if so, they will be supplied with
additional copies of the proxy card and proxy materials for distribution to
such beneficial owners. The Company will, in addition, reimburse parties
holding shares of Common Stock in their names or in the names of their
nominees for their reasonable expenses in sending proxy cards and proxy
materials to the beneficial owners of the shares of Common Stock.
The matters to be considered and acted upon at the Annual Meeting are
referred to in the preceding Notice. If the enclosed proxy card is
properly executed and returned to the Company, all shares represented
thereby will be voted as indicated thereon.
The address of the Company's principal executive offices is 333
Western Avenue, Westfield, Massachusetts 01085, U.S.A. This Proxy
Statement and the accompanying proxy card are being mailed on or about
March 14, 1997 to each stockholder of record as of the close of business on
February 28, 1997.
ANNUAL REPORT
The Annual Report to Stockholders of the Company for the year ended
December 31, 1996, including the Company's financial statements for its
1996 fiscal year, is to accompany this Proxy Statement, which is being
mailed on or about March 14, l997 to each stockholder of record as of the
close of business on February 28, 1997.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
On February 28, 1997, there were outstanding 17,903,786 shares of the
Common Stock, which is the only class of stock outstanding and entitled to
vote at the Annual Meeting and any postponement or adjournment thereof.
The holders of such shares will be entitled to cast one vote for each share
-2-
<PAGE>
held of record as of the record date. To the best knowledge of the
Company, the only beneficial owner of more than 5% of the Common Stock as
of December 31, 1996 was as follows:
<TABLE>
<CAPTION>
Amount and
Nature of Percent
Name and Address of Beneficial of
Beneficial Owner Ownership Class
<S> <C> <C>
GeoCapital Corporation 949,900 shares with 5.31%
767 Fifth Avenue sole investment power
New York, NY 10153 (of which Wilma J. Engel,
a managing director of
GeoCapital, owns 200 shares
with sole voting power)
</TABLE>
Management of the Company beneficially owned, as of January 31, 1997,
shares of the Common Stock as follows:
<TABLE>
<CAPTION>
Amount and Nature Percent
Name of of Beneficial of
Beneficial Owner Ownership (1)(2) Class(3)
<S> <C> <C>
John F. Cauley 7,975 Direct --
Janet M. Clarke 2,625 Direct --
Charles W. Elliott 3,150 Direct --
Judith R. Haberkorn 3,875 Direct --
Thomas R. Horton 6,975 Direct --
Allan G. Keirstead 207,176 Direct, 1.16%
1,488 Indirect
Homer G. Perkins 24,245 Direct, --
14,000 Indirect (4)
G. William Seawright 228,500 Direct, 1.26%
257 Indirect
H. L. Tower 111,684 Direct --
Anne-Lee Verville 5,875 Direct --
Michael W. Burgess 8,750 Direct --
John J. Dur 18,000 Direct, --
170 Indirect
Eugene Freedman 207,884 Direct, 1.37%
40,387 Indirect (5)
All Directors and 1,084,301 Direct, 6.20%
Executive Officers 78,501 Indirect
-3-
<PAGE>
as a Group
(18 persons)
___________________________________________________________________________
<FN>
(1)Unless otherwise noted, the nature of beneficial ownership is sole
voting and/or investment power. Fractional amounts have been rounded to
the nearest whole share of Common Stock.
(2)Includes shares of the Common Stock which the Directors, the named
Executive Officers, and All Directors and Executive Officers as a Group are
deemed to beneficially own by reason of options granted to them under the
Company's 1984, 1991 and 1996 Stock Option Plans and Special Interim Chief
Executive Officer Stock Option Plan which are exercisable within the next
60 days, including as follows: Mr. Cauley (6,375 shares), Ms. Clarke
(1,875 shares), Mr. Elliott (750 shares), Ms. Haberkorn (3,375 shares),
Messrs. Horton (5,975 shares), Keirstead (160,500 shares), Perkins (6,375
shares), Seawright (227,500 shares), and Tower (33,375 shares), Ms.
Verville (4,875 shares), and Messrs. Burgess (8,750 shares), Dur (17,500
shares) and Freedman (176,150 shares).
(3)Unless otherwise noted, percent of class of each Director and
named Executive Officer is less than 1%.
(4)Includes 14,000 shares of the Common Stock held by the residuary
trust established under the Will of Frank Stanley Beveridge. Mr. Perkins
shares voting and investment power over these shares and disclaims any
beneficial interest in all such shares.
(5)Includes 35,000 shares of the Common Stock owned by the Eugene
Freedman Family Limited Partnership, of which Mr. Freedman is the General
Partner, and 5,000 shares owned by the Eugene Freedman Family Foundation,
of which Mr. Freedman is an officer and a director. Mr. Freedman shares
voting and investment power over these shares and disclaims any beneficial
interest in all such shares except to the extent of his beneficial interest
in the Limited Partnership and the Foundation.
</TABLE>
ELECTION OF DIRECTORS
Effective as of the Annual Meeting, the Board of Directors of the
Company (the "Board") consists of ten members who are constituted into
three separate classes serving three years each with one class being
elected each year. The Board has adopted several policies concerning
resignation and retirement of Directors from the Board, one providing for
review by the Board of a Director's continued membership following a change
in principal employment, and another providing for retirement at age 72,
excluding Mr. Perkins who is not subject to this policy.
The term of office of the three incumbent Class II Directors, Ms.
Janet M. Clarke and Messrs. Charles W. Elliott and Allan G. Keirstead,
expires at the Annual Meeting. The Board proposes their election for a
three-year term expiring at the annual meeting of stockholders in April
2000. The election of the three nominees named above requires the
affirmative vote of the holders of a majority of the Common Stock present
in person or represented by proxy at the Annual Meeting; provided that a
quorum is present or represented. Abstentions will be treated as votes
cast and will have the effect of votes against in the voting count for the
election of Directors. Shares of Common Stock that are represented by a
broker and not voted with respect to a particular matter are not treated as
being present at the Annual Meeting and will have no effect on the voting
count.
-4-
<PAGE>
Proxies of stockholders containing no designation to the contrary
will be voted for the election of the three nominees named above.
If for any reason any nominee is not available to serve when the
election occurs, the persons named in the proxy cards will vote the proxies
in accordance with their best judgment. The Board has no reason to believe
that any nominee will not be available.
INFORMATION AS TO BOARD OF DIRECTORS AND NOMINEES
NOMINEES FOR DIRECTORS IN CLASS II
Terms expiring in 2000
___________________________________________________________________________
JANET M. CLARKE Senior Vice President, Information
Services Sector, R.R. Donnelley &
Sons Company ("Donnelley")
Director since 1994 [Photograph (commercial printer), New York, NY
of Director since 1994. Formerly Senior Vice
Age 44 omitted] President, Manufacturing - Financial
Printing Services Group since 1992;
and Senior Vice President and Vice
President - Documentation Services
Group of Donnelley since 1990 and
1988, respectively. Also, Director
of Cox Communications, Inc.,
Atlanta, GA and 77 Capital
Corporation (a Donnelley venture
capital investment company),
Chicago, IL. Member of the
Company's Audit and Organization
Committees.
___________________________________________________________________________
CHARLES W. ELLIOTT Retired in 1995 as Executive Vice
President - Administration and Chief
Financial Officer, Kellogg Company
Director since 1995 [Photograph (food products), Battle Creek,
of Director MI, after serving in such offices
Age 65 omitted] since 1987 and 1988, respectively.
Also, Director of Munder
Funds, Detroit, MI. Member of the
Company's Audit and Compensation
and Stock Option Committees.
___________________________________________________________________________
ALLAN G. KEIRSTEAD Executive Vice President and Chief
Administrative and Financial
Officer of the Company since 1988.
Director since 1985 [Photograph Member of the Company's Executive
of Director Committee.
Age 52 omitted]
___________________________________________________________________________
-5-
<PAGE>
DIRECTORS CONTINUING IN OFFICE IN CLASS I
Terms Expiring in 1999
___________________________________________________________________________
JUDITH R. HABERKORN Vice President, Individual
Communication Services, NYNEX
Corporation, New York, NY since
Director since 1993 [Photograph 1995. Formerly Vice President-
of Director Consumer Markets, NYNEX Corporation
Age 50 omitted] (telecommunications services),
New York, NY since 1994 and Vice
President-Sales and Marketing, New
York Telephone Co. since 1992.
Member of the Company's Audit and
Compensation and Stock Option
Committees.
___________________________________________________________________________
THOMAS R. HORTON Retired as Chairman and Chief Execu-
tive Officer of American Management
Association (management training),
Director since 1991 [Photograph New York, NY in 1992 and 1991,
of Director respectively, after serving since
Age 70 omitted] 1989 and 1982, respectively. Also,
Director of The Commercial Bank
of Volusia County, Ormond Beach,
FL. Chairman of the Company's
Organization Committee and
member of the Audit Committee.
___________________________________________________________________________
H. L. TOWER Chairman of the Board since 1982 and
Chief Executive Officer from 1978 to
1990; retired as an associate from
Director since 1978 [Photograph the Company in 1992; served briefly
of Director in 1993 as interim President and
Age 64 omitted] Chief Executive Officer. Also,
Director of Tambrands, Inc., White
Plains, NY. Chairman of the
Company's Executive Committee and
member of the Audit and Organization
Committees.
___________________________________________________________________________
DIRECTORS CONTINUING IN OFFICE IN CLASS III
Terms expiring in 1998
___________________________________________________________________________
JOHN F. CAULEY Retired as President of Friendly Ice
Cream Corporation, a subsidiary of
Tennessee Restaurant Company
Director since 1987 [Photograph (restaurants and food products),
of Director Memphis, TN in 1989. Chairman
Age 64 omitted] of the Company's Audit Committee
and member of the Executive and
-6-
<PAGE>
Compensation and Stock Option
Committees.
___________________________________________________________________________
HOMER G. PERKINS Retired as Chairman of the Board of
the Company in 1982. Member of the
Company's Executive, Audit and
Director since 1954 [Photograph Organization Committees.
of Director
Age 80 omitted]
___________________________________________________________________________
G. WILLIAM SEAWRIGHT President and Chief Executive
Officer of the Company since 1993.
Formerly President and Chief Execu-
Director since 1990 [Photograph tive Officer of The Paddington Corp-
of Director oration (importer of wines and
Age 55 omitted] spirits), Fort Lee, NJ, since 1990.
Also, Director of The Fonda Group,
Inc. (paper goods company), St.
Albans, VT. Member of the Company's
Executive Committee.
___________________________________________________________________________
ANNE-LEE VERVILLE General Manager - Worldwide
Education Industry of
International Business Machines
Director since 1991 [Photograph Corporation ("IBM")(advanced
of Director information technologies), White
Age 51 omitted] Plains, NY, since 1994. Formerly
President-General Sector Division
of IBM since 1991. Chairman
of the Company's Compensation and
Stock Option Committee and member of
the Audit and Executive Committees.
___________________________________________________________________________
REMUNERATION OF NON-EMPLOYEE DIRECTORS
The Board establishes the compensation paid to each Director who is
not also an employee of the Company for all services in such capacity. The
current remuneration amounts are as follows:
(1) For service as a member of the Board, a retainer of 200 shares
of the Common Stock and $15,000 per annum, plus $1,200 for
attendance at each meeting of the Board;
(2) For service as Chairman of the Board, an additional retainer of
$50,000 per annum;
(3) For service as a Board Committee member, an attendance fee of
$800 for each Committee meeting and other Directors' meeting
held in connection with the selection of potential nominees for
positions on the Board; and
(4) For service as Chairman of a Committee of the Board, an
additional attendance fee of $200 per Committee or other
meeting referred to above.
-7-
<PAGE>
Payment of these cash amounts may be partially or fully deferred by
the Director (with interest payable to the Director at the Company's cost
of borrowing) until a later year, retirement from the Board or a change in
control of the Company (in which case the Director will also be reimbursed
for any excise or other taxes incurred as a result of such payment).
In addition, during the three-year period ending in 1998, as of the
day following the annual meeting of stockholders, each then serving non-
employee Director receives a grant of 1,500 non-qualified options to
purchase shares of the Common Stock at an exercise price per share equal to
the fair market value per share of the Common Stock on the grant date. The
options become exercisable on the eighth anniversary of the grant, unless
they have already become exercisable as provided for in the Company's 1996
Stock Option Plan, and expire on the tenth anniversary of the grant.
Upon retirement of a non-employee Director at any time after age 60
with 5 years of service on the Board, he or she will become an "Advisory
Director" who may be called upon for advice by the Chief Executive Officer
of the Company as the occasion arises. For such services, an Advisory
Director shall receive, in addition to current attendance fees for his or
her requested participation at meetings, the annual retainer at the rate in
effect at the time of his or her retirement for a period of years equal to
the Director's years of service (but not in excess of 10 years) or until
his or her earlier death. In the event of a change in control of the
Company, each Advisory Director and each Director then eligible to retire
and become an Advisory Director will receive the balance of the retainer
payments due for his or her term, or remainder thereof, as an Advisory
Director, plus reimbursement for any excise or other taxes incurred as a
result of such payment.
Directors receive reimbursement from the Company for expenses
incurred in connection with service in that capacity. Directors who are
also employees of the Company receive no additional compensation for their
services as Directors.
ADDITIONAL INFORMATION CONCERNING THE BOARD OF DIRECTORS
Committees
The Audit Committee, comprised of eight Board members previously
identified, held three meetings during 1996. This Committee, which
consists entirely of non-employee Directors, provides oversight of the
Company's audit, accounting, reporting, and control practices and provides
a non-management link between the Board and the Vice President of the
Company's internal auditing department. This Committee reviews the
activities of the internal auditing department and the Company's
independent accountants. It also reviews the adequacy of the Company's
accounting, financial, and operating controls and reports to the full Board
as necessary.
The Compensation and Stock Option Committee, comprised of four Board
members previously identified, held six meetings during 1996. This
Committee, which also consists entirely of non-employee Directors,
determines compensation policy for the Company, approves or recommends to
the Board compensation of the Directors and officers of the Company and
reviews and acts on recommendations from the Chief Executive Officer which
concern awarding stock options and administering the stock option plans of
the Company and the Non-employee Director Stock Plan.
The Organization Committee, comprised of four Board members
previously identified, held four meetings during 1996. This Committee,
which also consists entirely of non-employee Directors, provides the Board
with Director and corporate officer recommendations, including with respect
-8-
<PAGE>
to the Chief Executive Officer of the Company, proposes to the Board each
year a slate of Directors for recommendation and submission to the
stockholders at the Company's next annual meeting of stockholders and deals
with all aspects of the Director selection process, reviewing prospective
Director candidates in the light of anticipated resignations and
retirements and the appropriate composition of the Board.
In accordance with the Company's Restated Articles of Organization,
as amended, the Organization Committee will consider a nominee for election
to the Board recommended by a stockholder if the stockholder gives notice
in writing to the Secretary of the Company, at least 45 days in advance of
the anniversary of the date of the previous annual meeting of stockholders,
which notice includes:
(a) The name and address of the stockholder who intends to make the
nomination and the name and address of the person or persons to
be nominated;
(b) A representation that the stockholder is a holder of record of
the Common Stock and intends to appear in person or by proxy at
the Company's next annual meeting of stockholders to nominate
the person or persons specified in the notice;
(c) A description of all arrangements or understandings between the
stockholder and each nominee and any other person or persons
(naming such person or persons) pursuant to which the
nomination or nominations are to be made by the stockholder;
(d) Such other information regarding each nominee proposed by such
stockholder as would be required to be included in a proxy
statement filed pursuant to the proxy rules of the Securities
and Exchange Commission; and
(e) The consent of each nominee to serve as a Director if so
elected.
In addition to the Committee meetings referred to above, the full
Board held eight meetings during 1996. One Director, Ms. Clarke, attended
7 of the 8 meetings of the Board and 4 of the 7 meetings of the Committees
of which she is a member that were held during the year.
EXECUTIVE COMPENSATION
The following table sets forth, for the fiscal years ended December
31, 1996, 1995 and 1994, the cash compensation paid by the Company and its
subsidiaries, as well as all other plan and non-plan compensation awarded
to, earned by or paid to the Chief Executive Officer and the four most
highly compensated Executive Officers of the Company other than the Chief
Executive Officer, who were serving at the end of 1996 (all five persons
being collectively referred to herein as the "Named Executive Officers")
for all services rendered in all capacities to the Company and its
subsidiaries:
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
Long Term
Compen-
Annual sation
Compensation (1) Awards (2)
Other Securities
Name Annual Under- All Other
-9-
<PAGE>
and Compen- lying Compen-
Principal sation Options sation
Position Year Salary($) Bonus($)(3)($) (#) ($)(4)
<S> <C> <C> <C> <C> <C> <C>
G. W. Seawright, 1996 $566,000 $ 257,530 $ - 70,500 $37,571
President and 1995 533,750 230,713 58,865(5) 125,000 41,295
Chief Executive 1994 500,000 341,900 72,030(6) 114,000 11,977
Officer
M. W. Burgess, 1996 259,000 - - 15,000 6,713
Vice President 1995 157,924 25,000 48,638(7) 35,000 145
(Chief Executive 1994 - - - - -
Officer of
Hamilton Direct
Response Group)
J. J. Dur, 1996 271,000 - 371,345(8) 15,000 13,792
Vice President 1995 249,167 38,621 348,852(9) 35,000 3,866
(Chief Executive 1994 - - - - -
Officer of
Stanhome
Direct Selling
Group)
E. Freedman, 1996 475,000 4,030,500 - 24,000 30,590
Executive Vice 1995 475,000 4,078,950 - 40,000 30,608
President 1994 475,000 3,472,050 - 43,000 30,626
(Chief
Executive Officer
of Enesco
Giftware Group)
A. G. Keirstead, 1996 363,000 127,050 - 21,000 21,642
Executive Vice 1995 348,250 121,888 - 40,000 21,511
President and 1994 331,000 156,695 - 42,000 6,991
Chief Administra-
tive and
Financial Officer
_____________________________________________________________________________
<FN>
(1)Annual compensation includes bonus compensation for the year,
whether paid in that year or in the succeeding year, under agreements with
Messrs. Seawright and Freedman and pursuant to the Company's Management
Incentive Plan with respect to Messrs. Burgess, Dur and Keirstead, and
except for Mr. Freedman, also includes salary compensation deferred through
the Company's (Hamilton's, in the case of Mr. Burgess) Investment Savings
Plan and Supplemental Investment Savings Plan.
(2)All Long-term Compensation Awards to the Named Executive Officers
during the three-year period were made in the form of non-qualified stock
options granted under the Company's 1991 and 1996 Stock Option Plans. No
stock appreciation rights ("SARs") were awarded either singly or in tandem
with the granted options.
(3)Totals for 1994 have been restated to comport with the format used
in 1995 and 1996 for reporting only performance-related bonuses in this
column.
(4)All Other Compensation in 1996 consisted of the following
-10-
<PAGE>
items for each of the Named Executive Officers: G. W. Seawright,
$4,500 matching contribution under the Company's 401(k) Investment
Savings Plan and $20,557 matching contribution under the Company's
Supplemental Investment Savings Plan, $500 contribution under the
Company's Payroll-Based Stock Ownership Plan ("PAYSOP Contribution")
and $12,014 insurance premiums paid by the Company with respect to
term life insurance for his benefit ("Insurance Premiums"); M. W.
Burgess, $4,500 matching contribution under Hamilton's 401(k)
Investment Savings Plan and $840 matching contribution under
Hamilton's Supplemental Investment Savings Plan, $500 PAYSOP
Contribution and $873 Insurance Premiums; J. J. Dur, $4,500 matching
contribution under the Company's Investment Savings Plan and $4,751
matching contribution under the Company's Supplemental Investment
Savings Plan, $500 PAYSOP Contribution and $4,041 Insurance Premiums;
E. Freedman, $22,500 contribution under the Enesco Profit Sharing Plan
and $7,500 contribution under the Enesco Supplemental Profit Sharing
Plan, $500 PAYSOP Contribution and $90 Insurance Premiums; and A. G.
Keirstead, $4,500 matching contribution under the Company's 401(k)
Investment Savings Plan and $11,097 matching contribution under the
Company's Supplemental Investment Savings Plan, $500 PAYSOP
Contribution and $5,545 Insurance Premiums.
(5)Includes $28,894 in automobile allowance and $24,521 in
reimbursed tax payments relating to relocation expenses for G. W.
Seawright.
(6)Includes $20,833 in relocation settling-in allowance paid to
G. W. Seawright.
(7)Includes $43,036 in relocation settling-in allowance paid to
M. W. Burgess.
(8)Includes $344,543 in total costs, including taxes, incurred
by the Company for J. J. Dur under the Company's Expatriate Policy.
(9)Includes $322,752 in total costs, including taxes, incurred
by the Company for J. J. Dur under the Company's Expatriate Policy.
</TABLE>
The following table contains information concerning individual grants
of stock options made by the Company to each of the Named Executive
Officers during the last fiscal year:
<TABLE>
OPTION GRANTS IN LAST FISCAL YEAR
<CAPTION>
Grant Date
Individual Grants (1) Value
Number
of Sec- % of
urities Total
Under- Options Grant
lying Granted to Exercise Date
Options Employees or Base Present
Granted in Fiscal Price Expiration Value
Name (#)(2) Year ($/Sh) Date $(3)
___________________________________________________________________________
<S> <C> <C> <C> <C> <C>
G. W. Seawright 70,500 18.4% $29.50 April 29, 2006 $508,305
M. W. Burgess 15,000 3.9% 29.50 April 29, 2006 108,150
-11-
<PAGE>
J. J. Dur 15,000 3.9% 29.50 April 29, 2006 108,150
E. Freedman 24,000 6.3% 29.50 April 29, 2006 173,040
A. G. Keirstead 21,000 5.5% 29.50 April 29, 2006 151,410
___________________________________________________________________________
<FN>
(1)The individual grants described herein were all made in the form
of non-qualified stock options under the Company's 1996 Stock Option Plan.
No SARs were granted by the Company during 1996.
(2)All Options granted have a ten-year term and become exercisable
only after six months from date of grant and upon the Company's achievement
of certain stock value performance criteria, or upon the eighth anniversary
of the date of grant regardless of whether those criteria have been
achieved.
(3)The Company used the Black-Scholes option pricing model to
determine the present value of the options granted as of their respective
date of grant. The assumptions used relating to the expected volatility,
risk-free rate of return, dividend yield and time of exercise were as
follows: (i) volatility was calculated based on the daily change in the
Common Stock price during the 250 trading days preceding the option grant
date; (ii) risk-free rate of return was the yield as of the option grant
date on U.S. Treasury bonds maturing in ten years; (iii) dividend yield was
computed based on the then most recent four quarterly dividends paid on the
Common Stock divided by the average of the highest and lowest closing
prices for the Common Stock during the twelve-month period ending on the
grant date; and (iv) time of exercise was the full term of the option
granted. There were no adjustments made in the option pricing model for
non-transferability or risk of forfeiture of the options granted.
</TABLE>
The following table sets forth information concerning the exercise of
stock options by each of the Named Executive Officers during the last
fiscal year and the value of unexercised stock options held by each of them
as of the end of the fiscal year:
<TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION VALUES
<CAPTION>
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Shares Options at Options at
Acquired FY-End (#) FY-End ($)
on Value
Exercise Realized Exercisable/ Exercisable/
Name (#) ($) Unexercisable Unexercisable
__________________________________________________________________________
<S> <C> <C> <C> <C>
G. W. Seawright 0 $0 167,375/246,625 $ 0/$0
M. W. Burgess 0 0 8,750/ 41,250 0/ 0
J. J. Dur 0 0 8,750/ 41,250 0/ 0
E. Freedman 0 0 150,400/ 80,500 140,250/ 0
-12-
<PAGE>
A. G. Keirstead 0 0 135,000/ 77,000 0/ 0
__________________________________________________________________________
</TABLE>
Pension Plan
The Company maintains a qualified Pension Plan, supplemental
retirement plans and certain supplemental retirement agreements requiring
contributions in amounts determined annually by independent actuaries. Of
the Named Executive Officers, only Messrs. Seawright and Keirstead are
eligible to participate in both the Pension Plan and their respective
supplemental retirement agreements and to receive reduced annual benefits
in the event of an involuntary termination without cause. Pension Plan
benefit payments are subject to a maximum allowed under Section 415 of the
Internal Revenue Code of 1986, as amended (the "Code"), of $125,000 in
1997. For purposes of the Pension Plan, 1997 compensation in excess of
$160,000 is excluded. The following table has been prepared without regard
to these limitations, however, and it includes amounts attributable to the
supplemental retirement agreements in which Messrs. Seawright and Keirstead
participate as Executive Officers who are also Directors:
<TABLE>
PENSION PLAN TABLE (1)
<CAPTION>
Remuneration Years of Service
_________________________________________________________
Final
Average
Compen-
sation 5 10 15 20
_________________________________________________________
<S> <C> <C> <C> <C>
$ 300,000 $150,000 $150,000 $150,000 $150,000
400,000 200,000 200,000 200,000 200,000
500,000 250,000 250,000 250,000 250,000
600,000 300,000 300,000 300,000 300,000
700,000 350,000 350,000 350,000 350,000
800,000 400,000 400,000 400,000 400,000
900,000 450,000 450,000 450,000 450,000
1,000,000 500,000 500,000 500,000 500,000
1,100,000 550,000 550,000 550,000 550,000
1,200,000 600,000 600,000 600,000 600,000
_________________________________________________________
Continued:
25 30 35 40
_________________________________________________________
<C> <C> <C> <C>
$150,000 $150,000 $150,000 $150,000
200,000 200,000 200,000 200,000
250,000 250,000 250,000 250,000
300,000 300,000 300,000 300,000
350,000 350,000 350,000 350,000
400,000 400,000 400,000 400,000
450,000 450,000 450,000 450,000
500,000 500,000 500,000 500,000
550,000 550,000 550,000 550,000
600,000 600,000 600,000 600,000
___________________________________________________________
<FN>
(1)The information contained in this Pension Plan Table represents
the aggregate estimated annual benefits payable to qualified Director
-13-
<PAGE>
participants under the Pension Plan and supplemental retirement agreements.
</TABLE>
The retirement plans to which Mr. Dur is a participant have a
qualified pension plan portion, as described below, and a supplemental
retirement plan portion. The supplemental portion represents a Pension
Plan benefit with no limits on compensation or benefit amounts less the
qualified Pension Plan benefit which limits compensation to $160,000 per
year pursuant to Code Section 401(a)(17) and a maximum benefit pursuant to
Code Section 415 of $125,000 in 1997. The following table has been
prepared without regard to these limitations or certain social security and
profit sharing plan benefit offsets, however, and it includes amounts
attributable to the supplemental retirement plan in which Mr. Dur
participates:
<TABLE>
PENSION PLAN TABLE (1)
<CAPTION>
Remuneration Years of Service
________________________________________________
Final
Average
Compen-
sation 5 10 15 20
________________________________________________
<S> <C> <C> <C> <C>
$100,000 $ 7,500 $15,000 $ 22,500 $ 30,000
200,000 15,000 30,000 45,000 60,000
300,000 22,500 45,000 57,500 90,000
400,000 30,000 60,000 90,000 120,000
500,000 37,500 75,000 112,500 150,000
600,000 45,000 90,000 135,000 180,000
__________________________________________________
__________________________________________________
Continued:
25 30 35 40
__________________________________________________
<C> <C> <C> <C>
$ 37,500 $ 45,000 $ 50,830 $ 53,333
75,000 90,000 101,660 106,667
112,500 135,000 152,490 160,000
150,000 180,000 203,320 213,333
187,500 225,000 254,150 266,667
225,000 270,000 304,980 320,000
__________________________________________________
<FN>
(1)The information contained in this Pension Plan Table represents
the aggregate estimated annual benefits payable to qualified non-Director
participants under the Pension Plan and supplemental retirement plans.
</TABLE>
For purposes of the qualified Pension Plan and the supplemental
retirement agreements and plans referred to above, "compensation" includes
total wage, salary, bonus, Company automobile benefit, and any amount which
is contributed by the employer pursuant to a salary reduction agreement and
which is not includible in gross income under the Code, but it does not
include other payments to benefit plans, other perquisite compensation or
reimbursement for business expenses. Except for Messrs. Dur and Freedman,
whose current covered compensation is $297,800 and $200,000, respectively,
substantially all of the items of current compensation covered by the
-14-
<PAGE>
Pension Plan and the supplemental retirement agreements and plans for each
of the other participating Named Executive Officers are included in the
Summary Compensation Table columns entitled "Salary ($)" and "Bonus ($)".
The pension benefit is based on the employee's "Final Average Compensation"
which means the highest average of annual compensation paid during any five
consecutive calendar years during the employee's last ten years of
employment. For purposes of the qualified Pension Plan, and of the
supplemental retirement agreements and plans in the event of an involuntary
termination, under amendments recently approved the number of credited
years of service is currently as follows for each of the Named Executive
Officers (except for Mr. Burgess who instead participates in the Hamilton
Profit Sharing, Investment Savings and Supplemental Investment Savings
Plans and for Mr. Freedman who instead participates in the Enesco Profit
Sharing and Supplemental Profit Sharing Plans): Mr. Seawright, 8; Mr. Dur,
7; and Mr. Keirstead, 32. Each of Messrs. Seawright, Dur and Keirstead is
fully vested in the Pension Plan and will become fully vested in his
supplemental retirement agreement/plan either upon the following respective
dates: August 28, 1998; January 16, 2000; and November 17, 1999; or upon
his earlier involuntary termination.
The qualified Pension Plan's portion of the estimated annual benefits
shown above is based upon an assumed normal retirement in 1997 at age 65,
is payable on a straight-life annuity basis to participants under the
Pension Plan in specified compensation and years of service
classifications, and is equal to 1 1/2% of the participant's Final Average
Compensation multiplied by his years of service up to 33 1/3 years, plus
1/2% for each Year of Service beyond that. These benefits are reduced by a
percentage of the retired employee's primary Social Security benefit (not
to exceed 50% of that benefit) and also are offset by any benefits from
Company contributions under the Company's Profit Sharing Plan, to which
Company contributions were discontinued when the Pension Plan came into
existence on January 1, 1980. The retirement benefit is reduced in the
event of early retirement prior to age 62. The Pension Plan also provides
for a surviving spouse's benefit in the event of the death of a vested
participant.
The supplemental retirement agreements' portion of the estimated
annual benefits first shown above is computed based upon an assumed normal
retirement in 1997 at age 65 and is equal to 50% of the participant's
average of annual compensation during the five highest compensated years
out of the last ten years of his employment prior to retirement, less the
following: (i) benefits from Company contributions under the Pension Plan;
(ii) benefits from Company contributions under the Company's Profit Sharing
Plan, to which Company contributions were discontinued when the Pension
Plan came into existence on January 1, 1980; and (iii) 50% of the retired
employee's Social Security benefits. The retirement benefit is reduced in
the event of early retirement, as specified under the supplemental
retirement agreements, prior to age 62. The supplemental retirement
agreements of Messrs. Seawright and Keirstead also include disability and
surviving spouse's benefits. These agreements provide for a monthly
retirement benefit in an amount subject to the individual taking a normal
or early retirement from the Company. An early retirement prior to age 62
for any reason other than a discharge for cause shall subject the monthly
retirement benefit to a stipulated percentage reduction.
Employment Contracts and Termination of Employment and Change in Control
Arrangements
Mr. Seawright, President and Chief Executive Officer of the Company,
received his annual base salary of $566,000 in 1996 and was eligible for a
bonus of up to 65% of his annual base salary under the Company's Management
Incentive Plan ("MIP") program pursuant to an employment agreement which
-15-
<PAGE>
has a rolling three-year term. In addition to standard executive officer
fringe benefits, he is eligible to receive special medical insurance
coverage including his spouse, and has a spousal death benefit. The
Company has also entered into a retirement agreement with Mr. Seawright
which is more fully described elsewhere in this Proxy Statement.
Mr. Freedman, Executive Vice President of the Company and Chairman
and Chief Executive Officer of Enesco Corporation, received an annual base
salary of $475,000 in 1996 and was entitled to a bonus in an amount equal
to the excess of five percent of Enesco's pre-tax net income over the paid
annual base salary pursuant to an employment agreement, as amended, which
will expire in 1997. His agreement also includes a severance benefit,
payable in a lump sum cash payment within five business days of
termination, equal to approximately three times his annual base amount as
defined in Section 280G of the Code if his employment terminates within two
years following a change in control of the Company for any reason other
than death, disability, retirement, or cause, or his voluntary termination
without good reason.
The Company has entered into both a supplemental retirement agreement
and a severance agreement with Mr. Keirstead, Executive Vice President of
the Company. The Company also has a supplemental retirement plan in which
Mr. Dur participates. Each of the aforementioned agreements and plan is
more fully described elsewhere in this Proxy Statement.
The Company has separate change in control agreements with Messrs.
Seawright, Burgess, Dur and Keirstead under which each of these individuals
is entitled to both (i) a severance benefit, payable upon or before
termination for any reason (other than death, disability, retirement,
termination for substantial cause or voluntary termination without good
reason) occurring within two years following a change in control of the
Company, equal to three times the annual base salary rate plus bonus under
the MIP program and (ii) certain fringe benefits for a three-year term. In
accordance with these change in control agreements, the individuals also
will be reimbursed for any excise or other taxes incurred as a result of
the benefits received by them thereunder. The types of events constituting
a change in control under these agreements include those that require
reporting under Item 6(e) of Schedule 14A of Regulation 14A promulgated
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and certain other events specified in the change in control agreements.
Amounts received by Mr. Seawright under his change in control agreement
with the Company, excluding payments for taxes, offset any payments to be
made as a result of his termination of employment under his aforementioned
employment agreement.
Terminations of Messrs. Seawright and Freedman absent a change in
control of the Company are governed by the provisions of their respective
employment agreements. Terminations of Messrs. Burgess, Dur and Keirstead
absent a change in control of the Company are governed by the Company's
general employee severance policy as confirmed by their respective
severance agreements, under which each of them is entitled to a severance
benefit, payable in lump sum or over a period of time, following
termination for any reason (other than death, disability, retirement or
termination for substantial cause), equal to his annual base salary for a
period of between one and two years depending on designated criteria,
specified relocation reimbursements and certain fringe benefits for up to a
24-month term.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During 1996, the following Directors, none of whom were then officers
or employees of the Company or any of its subsidiaries, served on the
Board's Compensation and Stock Option Committee: Ms. Verville, Messrs.
-16-
<PAGE>
Cauley, Elliott, Perkins, and Ms. Haberkorn. Mr. Homer Perkins, a former
officer of the Company, was a member of the Committee during 1996 until his
resignation therefrom on March 24, 1996. No current member of the
Committee is a former officer of the Company or any of its subsidiaries,
and none had any relationship requiring disclosure.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based on Company records and other information, the Company believes
that all Securities and Exchange Commission filing requirements under
Section 16(a) of the Exchange Act applicable to its Directors and executive
officers with respect to the Company's fiscal year ending December 31, 1996
were complied with.
COMPENSATION AND STOCK OPTION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Company's executive compensation program is administered by the
Compensation and Stock Option Committee of the Board. The Committee is
comprised of non-employee Directors who approve or recommend to the Board
salary and bonus amounts and other annual compensation and long-term
compensation awards for the executive officers of the Company.
The Company's executive compensation program during 1996 had three
components: base salary and fringe benefits; incentive bonus opportunity;
and option awards to purchase Common Stock. The Committee's compensation
policies regarding these components are designed to provide a compensation
package which is targeted between the median and third quartile level of
total compensation for similarly situated executive officers in a
comparator group of other U.S. companies of comparable size and geographic
diversity. The comparator group used in establishing the Company's
compensation levels is composed of companies that participate in two well
established and nationally recognized annual executive compensation
surveys. They are the "Towers Perrin Executive Compensation Survey" and
the "Management Compensation Services Project 777 Executive Compensation
Study". These surveys include some of the companies included in the
indices shown in the Performance Graph. The Committee believes that
evaluating data from the broad group of industries and companies
represented in these two surveys is important in establishing the true
market for executive talent. To compete effectively in this market, the
Company must be aware of compensation levels in various industries and
companies of all sizes and does not limit its analysis to those
constituting the indices shown in the Performance Graph.
Base salaries and fringe benefits are set at the annual base salary
and fringe benefit amounts of comparable executive officers. Pay for
performance bonuses are determined under the Company's Management Incentive
Plan ("MIP"), which provides for annual incentive opportunities amounting
to pre-determined percentages of the respective Executive Officers' annual
base salaries and which is based on pre-selected personal performance
criteria and certain specified Company profitability and performance goals.
Options to purchase Common Stock are granted in amounts that are
competitive with long-term incentive award practices of comparable U.S.
companies, considering the amount of options that have been previously
granted to each of the executive officers. The options, which correlate to
executive grade levels, are granted generally on an annual basis at the
then market value of the Common Stock and are exercisable at any time after
six months from the date of grant, subject to the Company's achievement of
certain stock value performance criteria or upon the eighth anniversary of
the date of grant under the provisions of the Company's 1996 Stock Option
Plan, for a ten-year term, thus providing a direct relationship between
executive officers' potentially realizable long-term compensation amounts
and actually recognizable increases in stockholder value. Executive
officer and Director stock ownership guidelines have been adopted with the
-17-
<PAGE>
objective of further aligning executive officers' and Directors' and
stockholders' interests. The Committee's compensation policies are intended
to reinforce the Company's performance-oriented compensation practices and
are not limited by potential outcomes of non-deductibility of certain
compensation amounts for federal tax purposes under the provisions of
Section 162(m) of the Code and the regulations promulgated thereunder.
Compensation for each of the Company's executive officers in 1996 was
determined by the foregoing program, except for Mr. Freedman, whose annual
base salary, fringe benefit and bonus compensation was established in a
negotiated employment agreement entered into during the acquisition of
Enesco Corporation, the terms of which are more fully described elsewhere
in this Proxy Statement.
Compensation for Mr. Seawright, President and Chief Executive Officer
of the Company, in 1996 included his base salary at the annual rate of
$573,000. His employment agreement provides that his annual base salary is
subject to increases from time to time at the discretion of the Board of
Directors. His 1996 MIP target opportunity of $367,900 was based 40% upon
achieving certain specified personal performance objectives relating to
strategic and financial goals and 60% upon achieving specified financial
objectives of the Company, including dollar sales volume, operating income,
earnings per share, net cash available and return on equity. As a result
of his personal performance criteria achievements and the Company's
financial results, Mr. Seawright's MIP bonus was $257,530. In 1996, the
Committee awarded Mr. Seawright a grant of 70,500 non-qualified options to
purchase Common Stock. The size of the grant relative to all other 1996
option grants made by the Committee and based upon its projected value as
of the grant date was determined to be within the guidelines which were
developed by the Committee's executive compensation consulting firm,
William M. Mercer, Incorporated. This grant was made under the Company's
1996 Stock Option Plan, becomes exercisable after eight years or sooner if
certain specified stock value performance criteria are achieved and has a
term of ten years from the date of grant.
The Compensation and Stock Option Committee:
A. L. Verville (Chairman) J. F. Cauley C. W. Elliott J. R. Haberkorn
___________________________________________________________________________
PERFORMANCE GRAPH
<TABLE>
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN AMONG THE COMPANY,
THE STANDARD & POOR'S ("S&P") MIDCAP 400 INDEX, AND THE COMPANY'S PEER
GROUP INDEX (1)
<CAPTION>
12/31/91 12/31/92 12/31/93 12/31/94 12/31/95 12/31/96
<S> <C> <C> <C> <C> <C> <C>
Stanhome
Inc. $100.00 $ 96.61 $ 97.29 $ 93.66 $ 89.29 $ 84.42
S&P
Midcap
400 $100.00 $111.91 $127.53 $122.96 $161.00 $191.91
Company's
Peer
Group $100.00 $104.13 $102.83 $ 73.25 $83.30 $ 87.64
___________________________________________________________________________
-18-
<PAGE>
<FN>
(1)This graphic presentation assumes (a) one-time $100 investments in
the Company's Common Stock and in market capital base-weighted amounts
apportioned among all the companies whose equity securities constitute the
above named board equity market index and the Company's selected peer group
index, in each case made as of the market close on the last trading day in
1991 and (b) the automatic reinvestment of dividends, if any, into
additional shares of the same class of equity securities constituting such
investments at the frequency with which dividends were paid on such
securities during the applicable fiscal years. The Company could not
choose to present the S&P Midcap 400 Consumer Products Index because it is
no longer being published by S&P. In its place, the Company has chosen to
present a peer group index composed of the same companies that constituted
the former S&P Midcap 400 Consumer Products Index, thus maintaining
continuity with comparisons provided in prior years' proxy statement
Performance Graph presentations. That peer group is made up of the
following ten companies: Carter-Wallace, Inc.; Church & Dwight Co., Inc.;
A.T. Cross Company; First Brands Corporation; Gibson Greetings, Inc.;
Lancaster Colony Corp.; National Presto Industries, Inc.; Perrigo Company;
Stanhome Inc.; and Tambrands Inc. (Source: Standard & Poor's Compustat -
Custom Business Unit, a division of McGraw-Hill.)
</TABLE>
INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen LLP has been engaged by the Company as independent
public accountants since 1971. As recommended by its Audit Committee, the
Board has appointed that firm as independent accountants for the Company
for 1997, subject to ratification by the stockholders. The treatment and
effect of abstentions and broker non-votes will be as specified in the
"Election of Directors" section of this Proxy Statement. Proxy cards of
stockholders containing no designation to the contrary will be voted for
the appointment of that firm. Representatives of Arthur Andersen LLP are
expected to attend the Annual Meeting and will be available to respond to
appropriate questions and to make a statement if they so desire.
STOCKHOLDER PROPOSAL
The following proposal was submitted by Ralph F. Kanders, 330 Madison
Avenue, Convent Station, NJ 07961.
Stockholder Proposal
RESOLVED: That the shareholders of Stanhome Inc. recommend to the
directors that they immediately seek alternative strategies with their
investment bankers to enhance shareholder value, whether through a sale of
assets or stock, or a merger, consolidation, reorganization,
recapitalization or otherwise.
Stockholder's Supporting Statement
I have been a shareholder of Stanhome Inc. since 1961. From 1990 to
1996, shareholder value has decreased by approximately 40% during the
greatest bull market of the century in which the S & P has advanced
approximately 130%.
All of Stanhome's divisions are experiencing fierce competition. The
total increase in sales of over $300 million from 1989 to 1996 has resulted
in lower earnings per share during a period of stock repurchase. Stanhome
has inadequate capital today to take advantage of an industry which
requires consolidation. The capital base includes approximately $100
million of goodwill.
-19-
<PAGE>
The Enesco operation is a secondary player in the collectibles arena
which is increasingly being dominated by the major motion picture
companies. "Precious Moments" today can be found in QVC and Marshall's
department stores at discounted prices serving to undermine the collectible
value.
The direct response division is highly competitive with approximately
45% of the gross sales for advertising and the highest quality competitor
Princeton Lenox Galleries posting annual losses.
Stanley Home Products International has its major operations in Spain
and Italy where the political-economic climate is poor. Italian tax
implications have served to eliminate product dealers significantly for
personal reasons and the major competitor would like to see our operation
reduced.
Recommendation of the Board of Directors
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
THAT YOU VOTE AGAINST THE STOCKHOLDER PROPOSAL.
Statement of the Board of Directors
in Opposition to the Stockholder Proposal
The proposal calls for the Board to take immediate action with
investment bankers to seek alternative strategies, such as a sale of assets
or stock, a merger, consolidation, reorganization, recapitalization or
other means, for the purpose of enhancing stockholder value. The Board in
principle supports initiatives to enhance stockholder value but believes
that adoption of the Stockholder Proposal would fail to achieve this goal.
The Stockholder Proposal fails to recognize that the Company has
never foreclosed the possibility of a sale of assets or stock, a merger,
consolidation, reorganization, recapitalization or any other strategic
transaction that is in the best interests of the Company and its
stockholders. In fact, the Company's officers and directors are committed
to the exploration and consideration of such transactions and their
pursuit, when appropriate, in order to enhance stockholder value. The
Board maintains regular, frequent and substantial contact with various
outside advisors, including management consultants, public accountants and
legal counsel, as well as investment bankers. These outside advisors
assist the Company in continually monitoring the marketplace, evaluating
potential opportunities and pursuing transactions that the Board believes
to be in the best interests of the Company and its stockholders.
The Board is aware of its fiduciary duties to Company stockholders
and, consequently, it remains open to all opportunities with the potential
to enhance stockholder value. However, the Board believes that the adoption
of the Stockholder Proposal at this time could create an uncertain public
atmosphere which, in its judgment, would disadvantage the Company in any
current or future efforts to pursue successfully the value-enhancing
strategies mentioned in the Stockholder Proposal. Simply put, such an
environment could result in the Company having diminished bargaining power
in negotiating strategic transactions for the benefit of its stockholders.
In addition, the uncertain atmosphere that could be created by the adoption
of the Stockholder Proposal might result in damage to customer and vendor
relationships, further jeopardizing the Company's stockholder value.
More importantly, adoption of the Stockholder Proposal would neither alter
nor, in the Board's view, promote the Board's pursuit of its basic duty to
manage the Company in the best interests of all stockholders. The Board
looks forward to the future and maintains foremost among its priorities the
enhancement of stockholder value.
-20-
<PAGE>
FOR THE REASONS STATED ABOVE, THE COMPANY'S BOARD OF DIRECTORS BELIEVES
THAT THE STOCKHOLDER PROPOSAL IS NOT IN THE BEST INTERESTS OF THE COMPANY
AND ITS STOCKHOLDERS. ACCORDINGLY, THE BOARD OF DIRECTORS UNANIMOUSLY
RECOMMENDS THAT YOU VOTE AGAINST THE STOCKHOLDER PROPOSAL.
The proposal requires for adoption the affirmative vote of the
holders of a majority of the Common Stock present in person or represented
by proxy at the Annual Meeting at which there is a quorum. The treatment
and effect of abstentions and broker non-votes will be as specified in the
Election of Directors section of this Proxy Statement. It is intended that
proxies of the stockholders containing no designation to the contrary will
be voted against the approval of the Stockholder Proposal as recommended by
the Board.
PROPOSALS OF SECURITY HOLDERS
Pursuant to rules of the Securities and Exchange Commission, a
stockholder owning of record or being the beneficial owner of at least
$1,000 in market value of the Common Stock may present a proposal to be
voted on at the 1998 annual meeting of stockholders, and provided such
proposal meets all of the requirements of those rules and is received by
the Company on or before November 14, 1997, it will be included in the
proxy statement and form of proxy relating to such meeting.
OTHER BUSINESS
The Annual Meeting is called for the purposes set forth in the
Notice. The Board does not know of any matter for action by the
stockholders at the meeting other than the matters described in the Notice.
However, the enclosed proxy confers discretionary authority with respect to
matters which are not known to the Board at the date of printing hereof and
which may properly come before the meeting. It is the intention of the
persons named in the proxy card to vote the proxy in accordance with their
best judgment on any such matter.
The Company files an Annual Report on Form 10-K with the Securities
and Exchange Commission. Stockholders may obtain a copy of the Annual
Report for the fiscal year ended December 31, 1996 without charge by
writing to the Clerk of the Company at 333 Western Avenue, Westfield,
Massachusetts 01085.
By order of the Board of Directors,
STANHOME INC.
BRUCE H. WYATT
Clerk
March 14, 1997
-21-
<PAGE>
PROXY STANHOME INC. PROXY
ANNUAL MEETING OF STOCKHOLDERS
APRIL 24, 1997
This Proxy is solicited on behalf of the Board of Directors
The undersigned, having read the Notice of Annual Meeting of
Stockholders and Proxy Statement dated March 14, 1997, receipt of which is
hereby acknowledged, does hereby appoint and constitute H.L. TOWER, G.
WILLIAM SEAWRIGHT, and BRUCE H. WYATT, and each or any of them the
attorneys and proxies of the undersigned, with power of substitution to
each, for and in the name of the undersigned to vote and act at the Annual
Meeting of Stockholders of Stanhome Inc. to be held at the principal
executive offices of the Company at 333 Western Avenue, Westfield,
Massachusetts, on Thursday, April 24, 1997 at 9:30 a.m. and at any
postponement or adjournment thereof, with respect to all shares of Common
Stock, par value $.125 per share, together with associated common stock
purchase rights of said Company, standing in the name of the undersigned or
with respect to which the undersigned is entitled to vote or act, with all
the powers that the undersigned would possess if personally present and
acting, as follows:
(Continued and to be signed and dated on the reverse)
<PAGE>
THIS PROXY WILL BE VOTED AS DIRECTED BUT IN THE Please mark -----
ABSENCE OF SUCH DIRECTION, IT WILL BE VOTED FOR your votes as X
ITEMS 1 AND 2, AND AGAINST ITEM 3, BELOW. indicated in -----
this example
1. To elect Janet M. Clarke, Charles W. Elliott, and Allan G. Keirstead as
Class II Directors for a three-year term. If any of such nominees
should be unavailable, the proxies or any of them may vote for
substitute nominee(s) at their discretion.
FOR all TO WITHHOLD (INSTRUCTION: To I plan to
nominees listed authority to withhold authority to attend the
above (except vote for all vote for one or more meeting.
as marked to nominees listed individual nominees,
the contrary) above write the nominee's -----
name in the space
provided below.) -----
______ ______
______ ______ _____________________
2. To ratify the appointment by the Board of Directors of Arthur
Andersen LLP as independent accountants for 1997.
FOR AGAINST ABSTAIN
______ ______ ______
______ ______ ______
3. To approve the stockholder proposal recommending that the Board
of Directors utilize investment bankers to identify alternatives to
enhance the Company's value.
FOR AGAINST ABSTAIN
______ ______ ______
______ ______ ______
4. To transact such other business as may properly come before the
meeting and any postponement or adjournment thereof.
_____________________________
_____________________________
Please sign above exactly as
name(s) appear(s) hereon.
(When signing as attorney,
executor, administrator,
trustee, guardian, etc., give
title as such. If joint
account, each joint owner
should sign.)
_______________________, 1997
(Please date)
PLEASE SIGN, DATE, AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
<PAGE>
STANHOME INC.
Annual Meeting of Stockholders
Thursday, April 24, 1997
9:30 a.m.
Corporate Headquarters
Stanhome Inc.
333 Western Avenue
Westfield, Massachusetts 01085
