SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-12
HOMASOTE COMPANY
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(Name of Registrant as Specified In Its Charter
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:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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/ / 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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HOMASOTE COMPANY
LOWER FERRY ROAD, PO BOX 7240
WEST TRENTON, NJ 08628
Notice of Annual Meeting of Stockholders
May 2, 2002
TO THE STOCKHOLDERS:
The Annual Meeting of Stockholders of Homasote Company will be
held at the Office of the Company, 932 Lower Ferry Road, West
Trenton, New Jersey, on Thursday, May 2, 2002, at 10:00 a.m. for
the following purposes:
1.To elect 10 directors to hold office for one year and until
their successors shall be elected and shall qualify, and
2.To transact such other business as may properly come before
the meeting or any adjournment thereof.
Pursuant to the provisions of the Bylaws, the Board of Directors
has fixed the close of business on March 13, 2002 as the record
date for the determination of the stockholders entitled to notice
of and to vote at the meeting and at any adjournments thereof.
Only stockholders of record at the close of business on that date
will be entitled to notice of and to vote at the meeting. The
stock transfer books will not be closed.
By Order of the Board of Directors
JENNIFER D. BARTKOVICH
Secretary
Trenton, New Jersey
April 3, 2002
Whether or not you expect to be present at the meeting, please
sign the accompanying Proxy and return it promptly in the enclosed
self-addressed envelope, which requires no postage if mailed in the
United States, so that your shares may be represented at the
meeting.
PROXY STATEMENT
This Proxy Statement is furnished in connection with the
solicitation by the Board of Directors of Homasote Company of
Proxies to be voted at the Annual Meeting of Stockholders of
Homasote Company (the "Company") to be held May 2, 2002.
The Company's Annual Report for the year ended December 31,
2001, Notice of Meeting, and a form of Proxy accompany this Proxy
Statement. The Proxy may be revoked by the person giving it at any
time prior to its use by voting in person at the meeting, by filing
a later dated proxy with Jennifer D. Bartkovich, Secretary,
Homasote Company, P. O. Box 7240, West Trenton, New Jersey 08628-
0240, or by giving written notice of such revocation to the
Secretary of the Company.
The mailing address of the Company is P.O. Box 7240, West
Trenton, New Jersey 08628-0240. It is anticipated that the Proxy
Statement and accompanying Proxy will first be sent to the
Stockholders on or about April 3, 2002.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
As of March 13, 2002, the Company had 348,799 shares of
outstanding common stock, 20 cents par value, which constitutes all
of the outstanding voting securities of the Company. Only holders
of common stock of record at the close of business on March 13,
2002, will be entitled to one vote per share on all business of the
meeting. Abstentions and any shares as to which a broker or
nominee indicates that it does not have discretionary authority to
vote on a particular matter will be treated as shares that are
present and entitled to vote for purposes of determining the
presence of a quorum but as unvoted for purposes of determining
whether the approval of stockholders has been obtained with respect
to any such matter and thus will have the effect of a vote to
"Withhold" in the election of directors.
<TABLE>
The following table sets forth certain information as of March
13, 2002, with respect to the only persons known to the Company who
beneficially owned more than 5% of the Company's voting securities.
<CAPTION>
Shares of Common Stock Percent
Name and Address of of the Company Beneficially of
Beneficial Owner Owned Directly or Indirectly Class
<S> <C> <C>
Irving Flicker 30,132 8.64
860 Lower Ferry Road
Trenton, NJ 08628
Warren L. Flicker 60,282 17.28
14 Pond View Lane
Titusville, NJ 08560
Michael R. Flicker, Esquire 56,092 16.08
120-B Santa Margarita Ave.
Menlo Park, CA 94025
Estate of Shanley E. Flicker 18,000 5.16
18 Edgewood Road
Yardley, PA 19067
</TABLE>
ELECTION OF DIRECTORS
The Company currently has ten Directors who were elected for
one-year terms and serve until their respective successors are duly
elected and qualified. Unless marked to the contrary, it is
intended that votes will be cast pursuant to the Proxies hereby
solicited for the election of the ten nominees listed in the table
below to serve until the Company's Annual Meeting in 2003 and until
their respective successors are duly elected and qualified. Each
of the nominees listed below is currently a Director of the
Company, having been elected to serve as a Director at the
Company's Annual Meeting in 2001. Directors will be elected by a
plurality vote. The Management is informed that all of the
nominees are willing to serve as Directors, but if at the time of
election any of the nominees should be unavailable for election, a
circumstance which is not anticipated by the Board of Directors,
the Proxies will be voted for such substituted nominee or nominees
as may be designated by the Board of Directors. The following
table sets forth certain information with respect to the Directors
and Officers of the Company. Except as otherwise provided, each
of the following executive officers of the Company has served in
his or her present capacity or capacities for more than the past
five years.
<TABLE>
<CAPTION>
NOMINEES FOR ELECTION AS DIRECTORS
Shares of Common Stock
of the Company
Beneficially Owned
Year Directly or Percent
Name and Principal Became Indirectly as of of
Occupation Director Age March 24, 2002 Class
<S> <C> <C> <C> <C>
Joseph A. Bronsard 1995 68 1,100 0.32
Executive Vice
President,1995-2001;
Plant Manager, Homasote
Company, 1983-2000
Irving Flicker(1,2) 1960 87 30,132 8.64
Chairman Emeritus,
2000-present; Chairman
of the Board,1972-2000;
Chief Executive Officer,
Homasote Company, 1979-
1999
Michael R. Flicker(2) 1983 61 56,092 16.08
Attorney-at-Law,
Flicker & Kerin,
Attorneys at Law,
Menlo Park, CA, 1990-
present; Private
practice of law,
1969-present
Warren L. Flicker(1,2) 1974 58 60,282 17.28
Chairman and Chief
Executive Officer,
2000-present;
President and Chief
Operating Officer,1995-
2000; Executive Vice
President, Homasote
Company, 1979-1994
Irene T. Graham, CPS 2000 80 2,000 0.57
Corporate Secretary,
2000; Retired, Former
Corporate Secretary
and member of the
Board of Directors,
Homasote Company,
1985-1994
Peter J. McElvogue 2001 39 1,292 0.37
President, Homasote
Company, June 2000-
Present; President,
MMI, manufacturers'
representative firm,
Bensalem, PA, 1992-
June 2000; Building
Product Manager,
Homasote Company,
1986-1991
Peter N. Outerbridge 1960 73 1,363 0.39
Chairman of the Board,
Chelston Management
Ltd., a provider of
investment holding and
management services,
St. John's,
Newfoundland, Canada,
1996-present
James M. Reiser, C.P.A. 1999 59 2,242 0.64
Vice President & Chief
Financial Officer,
Homasote Company, March
1999-Present; Controller,
Trenton Alloy
Fabricating, Inc., a
metal fabricator,
Trenton, NJ, 1996-1999;
Financial Consultant,
Tumi Luggage, a
manufacturer and
distributor of luggage
products, Middlesex, NJ,
1995-1996; Controller,
York Luggage Co., a
manufacturer and distributor
of luggage products
Lambertville, NJ 1977-1995.
Charles A. Sabino, 1998 62 7,671 2.20
C.P.A., J.D. Tax
Consultant, Self-
Employed present;
Managing Partner,
KPMG Peat Marwick LLP,
Princeton, NJ 1967-1997,
Certified Public
Accountants for
the Company
Norman Sharlin 1998 61 2,000 0.57
President and
Chief Operating
Officer, Sharlin
Lite Corporation of
America, distributor
of lighting products,
Ewing Twp., NJ,
1978-present
All directors and officers as a 164,174 47.06
group (10) including those named
above
</TABLE>
(1) Warren L. Flicker is the son of Irving Flicker.
(2) Michael R. Flicker is the son of Irving Flicker and brother of
Warren L. Flicker.
OTHER INFORMATION
The Board of Directors held four meetings in 2001. With the
exception of Michael R. Flicker and Peter Outerbridge who attended
50% of the meetings, all of the Directors attended 100% of the
meetings. The Directors who are not employees of the Company are
each compensated with a retainer fee of $4,000 and, in addition,
$500 per Board meeting attended. Directors who are employees of
the Company are each compensated with a retainer fee of $1,000, but
are not separately compensated for attendance at Board meetings.
Irving Flicker, Warren L. Flicker, James M. Reiser, and Norman
Sharlin are Trustees of The Homasote Foundation, a non-profit
corporation which distributes payments made by the Company for
charitable and educational purposes. The Homasote Foundation owns
1,052 shares of the common stock of the Company.
The Company does not have a standing Nominating Committee or any
standing committee performing a similar function. The functions
customarily performed by such a committee are considered the
responsibility of the Board of Directors as a whole.
Report of Audit Committee
The Board of Directors of the Company maintains an Audit
Committee, the primary functions of which are to assist the Board
in fulfilling its responsibility to (i) oversee management's
conduct of the Company's financial reporting process, (ii) assist
the Board in carrying out its fiduciary duties, and (iii) provide
a channel of communication between the Board and the Company's
outside auditors. On December 1, 2000, the Board of Directors
adopted a written Charter of the Audit Committee.
Since the beginning of 2001, the Audit Committee has done the
following:
(1) reviewed and discussed the audited financial statements of
the Company for the year ended December 31, 2001 (the "Audited
Financial Statements") with management of the Company,
(2) discussed with the independent auditors the matters required
to be discussed by SAS 61 (Communications with Audit
Committees), as may be modified or supplemented, and
(3) received the written disclosure and the letter from the
independent auditors of the Company required by Independence
Standards Board Standard No. 1 (Independence Discussions with
Audit Committees), as may be modified or supplemented, and has
discussed with the independent auditors their independence.
Based on the review and discussions referred to in items (1)
through (3) above, the Audit Committee recommended to the Board of
Directors that the Audited Financial Statements be included in the
Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 2001, for filing with the Securities and Exchange
Commission.
Peter N. Outerbridge, Charles A. Sabino and Norman Sharlin,
Directors of the Company, are the members of the Company's Audit
Committee, which held two meetings during 2001. Mr. Sabino serves
as Chairman of the Audit Committee.
All members of the Audit Committee are independent as defined
in Rule 4200(a)(15) of the NASD's listing standards, as such Rule
may be modified or supplemented.
Audit And Non-Audit Fees
The following table presents fees for professional audit
services rendered by KPMG LLP for the audit of the Company's
Audited Financial Statements for 2001, and fees billed for other
services rendered by KPMG LLP.
Audit Fees, excluding audit related $59,000
======
Financial information systems design
and implementation fees $ 0
======
All other fees:
Audit related fees (1) $11,000
Other non-audit services fees $ 0
______
Total all other fees $11,000
======
(1) Audit related fees consisted of audits of financial statements
of certain employee benefit plans.
EXECUTIVE COMPENSATION
Compensation for the Company's executive officers is the
responsibility of the Board of Directors, based on recommendations
of the Company's Compensation Committee. The members of the
Compensation Committee are Irving Flicker, Warren L. Flicker, James
M. Reiser and Charles A. Sabino. Each executive officer's salary
is based on his specific responsibilities, overall performance, and
employment contract when applicable. The Compensation Committee
also periodically recommends awards of discretionary bonuses to
executive officers. The bonuses are based upon the performance of
the individual executive and the financial results of the Company.
The following table sets forth certain information with regard
to compensation awarded to, earned by, or paid by the Company in
each of the Company's last three fiscal years to (i) the Chief
Executive Officer of the Company, and (ii) the three highest
compensated executive officers of the Company (other than the
Company's Chief Executive Officer) who were serving as executive
officers of the Company at December 31, 2001.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION
Other Annual All Other
Name and Principal Year Salary Bonus Compen.(1,2) Compen.(3,6)
Position ($) ($) ($) ($)
<S> <C> <C> C> <C> <C>
Warren L. Flicker(4) 2001 210,000 31,500 1,000 8,010
Chairman and Chief 2000 200,000 40,000 1,000 424
Executive Officer 1999 150,000 --- 1,000 127
Peter J. McElvogue(5) 2001 150,000 15,000 1,000 2,750
President 2000 67,500 3,000 584
Joseph A. Bronsard 2001 90,000 --- 61,000 1,355
Exec. V. President 2000 90,000 13,500 1,000 1,866
and Plant Manager 1999 80,958 --- 1,000 923
James M. Reiser 2001 90,000 18,000 1,000 1,398
Vice President and 2000 90,000 13,500 1,000 799
Chief Financial 1999 66,667 --- 1,000 94
Officer
</TABLE>
(1) The incremental cost to the Company of perquisites and other
personal benefits did not for any year exceed 10% of any named
executive's total annual salary and bonus.
(2) Fees paid for service as Directors, except for Joseph A.
Bronsard who received a severance payment of $60,000 and
Directors fees of $1,000.
(3) Amounts for 2001 represent (i) Company contributions to its
Savings Plan on behalf of Peter J. McElvogue ($1,500), James M.
Reiser ($750), and Joseph A. Bronsard ($750) and (ii) amounts
paid by the Company for life insurance on Joseph A. Bronsard
($605), Warren L. Flicker ($8010), Peter J. McElvogue ($1250)
and James M. Reiser ($648).
(4) The Company has an employment contract with Warren L. Flicker
dated and effective as of May 7, 1999, providing for his
continued employment in a full-time capacity until May 6,
2009, at an annual salary of $200,000, adjusted biennially
for changes in the Consumer Price Index (as defined), with the
right to receive such additional executive compensation as may
be granted by the Board of Directors of the Company and its
subsidiary. Warren L. Flicker voluntarily deferred the
effective date of his increase in salary under such employment
contract until January 1, 2000, in order to improve results of
operations of the Company for 1999.
(5) The Company has an employment contract with Peter J. McElvogue
dated and effective as of July 1, 2000, providing for his
continued employment in a full-time capacity until June 30,
2010, at an annual salary rate in 2000 of $135,000, increasing
to $150,000 in 2001 and adjusted biennially thereafter for
changes in the Consumer Price Index (as defined), with the
right to receive such additional executive compensation as may
be granted by the Board of Directors of the Company and its
subsidiary.
(6) The Company instituted a Supplemental Retirement Plan
effective January 1, 1978, for certain key employees. Payment
is based on "average annual earnings," which is defined as the
average basic earnings in the five calendar years out of the
ten calendar years of employment prior to the employee's
retirement for which the employee received the highest
earnings. As of this date, the Plan is unfunded.
(Table on next page)
<TABLE>
<CAPTION>
FIVE YEAR AVERAGE ANNUAL BENEFIT FOR YEARS OF CREDITED SERVICE
ANNUAL EARNINGS PRIOR TO REDUCTION FOR SOCIAL SECURITY AND
COMPANY PROVIDED PENSION BENEFITS
10 Years 15 Years 20 Years 30 Years 40 Years
<S> <C> <C> <C> <C> <C>
$ 50,000 $12,500 $ 18,750 $ 25,000 $ 25,000 $ 25,000
100,000 25,000 37,500 50,000 50,000 50,000
150,000 37,500 56,250 75,000 75,000 75,000
200,000 50,000 75,000 100,000 100,000 100,000
250,000 62,500 93,750 125,000 125,000 125,000
300,000 75,000 112,500 150,000 150,000 150,000
350,000 87,500 131,250 175,000 175,000 175,000
</TABLE>
The current years of credited service of the individuals set
forth in the table above are:
Warren L. Flicker, 36 and Joseph A. Bronsard, 33.
In November 1975, the Board of Directors adopted a Savings Plan
effective April 1, 1976, in which all employees are eligible to
participate. Under the Savings Plan, each employee may contribute
up to 15% (50% in 2002) of his or her total monetary compensation,
limited to a maximum of $10,500 ($11,000 in 2002). The Savings
Plan provides for contributions by the Company of 25% of the first
4% or fraction thereof contributed by each participating employee.
Effective November 1, 2000, the Company amended and restated the
Savings Plan in its entirety to convert the Savings Plan to a plan
that qualifies and meets the requirements under Section 401(k) of
the Internal Revenue Code. Additionally, as of such date, the
Company appointed Vanguard Fiduciary Trust Company, Inc. as trustee
of the Savings Plan, with funds of the Savings Plan to be invested
in those mutual funds of the Vanguard Group selected by the
Company's Savings Plan Administrative Committee and as designated
by the participating employee.
FIVE-YEAR COMPARISONS
PERFORMANCE GRAPH
The following graph compares for the five years ended December
31, 2001, the cumulative total shareholder return on the Company's
Common Stock with the cumulative total return on the Lipper Small
Company Index and with the cumulative total return on the Russell
2000 Index. The graph assumes that $100 was invested on December
31, 1996, in each of the Company's Common Stock, the Lipper Small
Company Index and the Russell 2000 Index, and that all dividends
were reinvested.
INFORMATION CONCERNING THE COMPANY'S AUDITORS
The Board of Directors has selected KPMG LLP as the auditors for
the Company for the fiscal year ending December 31, 2002. KPMG LLP
acted as the Company's independent auditors for the fiscal year
ended December 31, 2001. A member of the firm of KPMG LLP is
expected to be present at the meeting and, if present, will have an
opportunity to make a statement if he/she desires to do so and to
respond to appropriate questions.
OTHER BUSINESS
The Board of Directors does not know of any business to be
presented at the Annual Meeting other than that which is
specifically referred to in the Proxy and this Proxy Statement.
However, if any other matter should properly come before the
meeting, it is intended that votes will be cast pursuant to the
Proxy in respect thereto in accordance with the best judgment of
the persons acting as Proxies.
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the Annual
Meeting in 2003 must be received by the Company at its executive
offices (please address to the attention of Jennifer D. Bartkovich,
Secretary), P.O. Box 7240, West Trenton, New Jersey 08628-0240, for
inclusion in the Proxy Statement and form of Proxy relating to that
meeting by December 4, 2002. Any such proposal must comply with
Rule 14a-8 of Regulation 14A of the Proxy Rules of the Securities
and Exchange Commission.
EXPENSE OF SOLICITATION OF PROXIES
The cost of this solicitation of Proxies will be borne by the
Company. The Proxies will be solicited principally through the use
of the mails, but officers and regular employees of the Company may
solicit Proxies personally or by telephone or facsimile. The
Company reimburses banks, brokerage houses and other custodians,
nominees, and fiduciaries for their reasonable expenses in
forwarding proxy material to their principals.
A copy of the Company's Annual Report on Form 10-K including the
financial statements and schedules thereto is available, without
charge, on written request directed to Jennifer D. Bartkovich,
Secretary, Homasote Company, P.O. Box 7240, West Trenton, New
Jersey 08628-0240.
By Order of the Board of
Directors
JENNIFER D. BARTKOVICH
Secretary
April 3, 2002