| BOISE CASCADE COMPANY | ||
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Notice of Annual Meeting and Proxy Statement |
March 22, 2019
Fellow Shareholders:
You are cordially invited to join us for our 2019 annual meeting of shareholders, which will be held on Thursday, May 2, 2019, at 9:30 a.m. Mountain Time, in Meeting Place 1 at the Hyatt Place Boise, Cascade Company
As we look forward to our 2019 annual meeting of shareholders, it is worth reflecting on the year just completed. In 2018, our full year financial results, excluding facility sale and closure changes, were at the highest levels we have delivered since our IPO in 2013, and, despite the largest drop in commodity pricing in 20 years, both businesses were well-managed and worked diligently to minimize the impact. Additionally, we took several actions (discussed in more detail on page 2) to lower costs and increase our strategic focus in manufacturing and to accelerate growth in distribution.
As a reflection of our progress toward executing our long-term strategy, and as a way to return capital to you – our shareholders – we returned $55 million to our shareholders in 2018 through our quarterly dividend, an additional one-dollar-per-share dividend, and share repurchases. It is our intention to continue to return excess capital to our shareholders when we have not identified suitable growth opportunities for the businesses. We believe that our continued execution on our long-term growth plan will help ensure that our shareholders reap the benefits of our strategy and investments in the years to come.
Whether or not you plan to attend the annual meeting, your vote is important and we encourage you to vote your shares promptly. If you will note vote your shares at the meeting, you may vote your shares using a toll-free telephone number or the Internet. If you received a paper copy of the proxy card by mail, you may sign, date, and mail the proxy card in the envelope provided. Instructions regarding the three methods of voting are contained on the Notice of Internet Availability of Proxy Materials and the proxy card.
Sincerely,
Tom Corrick
Chief Executive Officer
Boise Cascade Company
1111 West Jefferson Street
Suite 300
Boise, ID 83702
NOTICE OF ANNUAL MEETING
OF SHAREHOLDERS
May 2, 2019, at 9:30 a.m., Mountain Time
Meeting Place 1; Hyatt Place Boise
1024 W. Bannock St., Boise, ID 83702
To the Shareholders of Boise Cascade Company (Company), a Delaware Corporation. Company:
The Annual Meeting2019 annual meeting of shareholders of Boise Cascade Company will be held at the Payette Meeting Room inabove date, time, and location, for the Hampton Inn & Suites, 495 S. Capitol Boulevard, Boise, Idaho 83702, at 9:30 a.m. Mountain Daylight Time on May 3, 2018. The purposes of the Annual Meeting, as more fully described in the proxy statement accompanying this notice, are:
1. | To elect |
| 2. | To hold an advisory (non-binding) vote to approve the compensation of the |
| 3. | To ratify the appointment of KPMG LLP as the |
| 4. | To conduct other business properly presented at the meeting. |
To vote on the matters brought before the meeting, you may submit your proxy vote by telephone or Internet, as described in the Notice of Internet Availability of Proxy Materials and the following proxy statement, no later than 11:59 p.m. Eastern Daylight Time on Wednesday, May 1, 2019 for any shares you hold directly. If you received a paper copy of the proxy card by mail, you may sign, date, and mail the proxy card in the envelope provided. The envelope is addressed to our vote tabulator, Broadridge Financial Solutions, Inc., and no postage is required if mailed in the United States. Holders of record of the Company’s common stock at the close of business on March 6, 2018 (the Record Date)2019 are entitled to notice of, and to vote at, the Annual Meeting in person or by returning the proxy card provided with this proxy statement. Each non-treasury share is entitled to one vote on each matter to be voted upon at the Annual Meeting. If you plan to attend the Annual Meeting in person, please bring photo identification, as well as your Notice of Annual Shareholder Meeting; your brokerage statement reflecting your ownership of Boise Cascade common stock; a copy of the voting instructions card provided by your broker, trustee or nominee; or similar evidence of share ownership as of the Record Date.
Many of Boise Cascade’s shareholders received their 20172018 proxy materials and annual report electronically. If we mailed you a noticeNotice of Internet availabilityAvailability of proxy materialsProxy Materials or a
| ● | Following the instructions provided on your proxy card or voting instruction form if you received a paper copy of the proxy materials; |
| ● | Following the instructions provided when you vote over the Internet; or |
| ● | Reaching out to your broker for its specific instructions. |
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON MAY 2, 2019. The Notice of the Annual Meeting of Shareholders, Proxy Statement, and 2018 Annual Report are available at www.proxyvote.com, as set out in the proxy card, and on page 38 of the proxy materials;
By order of the instructions provided when you vote over the Internet; or
Jill M. Twedt
Vice President, Human ResourcesGeneral Counsel and General Counsel
Boise, Idaho
March 22, 2019
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This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all of the information you should consider, and you should read the entire proxy statement carefully before voting. As used in this proxy statement, unless the context otherwise indicates, the references to "Boise“Boise Cascade,"” the "Company," "we," "our,"“Company,” “we,” “our,” or "us"“us” refer to Boise Cascade Company.
Our proxy statement and 20172018 Annual Report are available at www.proxyvote.com as set forth on page 38. The proxy materials, including this proxy statement and form of proxy, are being distributed and made available on or about March 22, 2019.
Purpose and Strategy
Boise Cascade’s strategy is to become the premier integrated manufacturing and wholesale distribution company for building products. As a leading manufacturer and distributor of building materials, we bring people, products, and services together to build strong homes, businesses, and communities that stand the test of time. At Boise Cascade, we truly care about relationships with our website at www.bc.com by selecting teammates, customers, suppliers, shareholders, and the communities where we operate. We approach the way we do business with these core values:
| ● | Integrity We are our word. Integrity goes beyond the lasting structural strength of our products. Integrity is our uncompromising commitment to do the right thing. We nurture long-term relationships every day, in everything that we do. |
| ● | Safety We each have the responsibility for our own safety and the safety of those around us, both at work and at home. Together, we strive to create an injury-free environment by identifying risks, eliminating hazards, and requiring safe behaviors. |
| ● | Respect We cultivate a climate of mutual respect, camaraderie, and teamwork. We welcome diverse backgrounds, views, and skills because we believe it results in stronger teams, inspired solutions, and greater agility as an organization. |
| ● | Pursuit of Excellence We are committed to the continuous improvement of people, processes, and the quality of products that we deliver. We apply best practices in our environmental management and forest stewardship. We all have the autonomy to apply our knowledge and experience to solve problems, make decisions, and implement new ideas to drive sustainable results. |
Executing our Strategy
In 2019, we plan to continue executing our strategy and creating attractive returns on capital by:
| ● | Expanding our veneer production capabilities at our Chester, South Carolina and Florien, Louisiana facilities. |
| ● | Growing our operations with a focus on expanding our market position in Engineered Wood Products (EWP). |
| ● | Continuing to improve our competitiveness through operational excellence. |
| ● | Using our Boise Improvement Cycle process, automated warehouse conversions, and business optimization group to continue lowering our costs of manufacturing and distribution. |
| ● | Pursuing organic growth opportunities and in-fill opportunities in strategic locations across the country for our distribution business. |
| ● | Continuing to explore manufacturing and distribution opportunities in adjacent businesses. |
2019 Annual Meeting Information
| Date and Time | Place | Record Date | Voting |
May 2, 2019 9:30 a.m. | |||
| March 6, 2019 | |||
Note: Cameras, recording devices, and other electronic devices will not be permitted at the meeting. You may obtain directions to the meeting place by calling our corporate offices at (208) 384-6161.
Voting Matters
| Proposal | ||||||
| Board Recommendation | Additional Information Page Reference | Vote Requirement | Broker Discretionary Voting Allowed? | Effect of Abstentions | Effect of Broker Non-Vote | |
1. Election of Directors | page 4 | Majority of | No | Counted as | No effect | |
2. Advisory | page 8 | Majority of | No | Counted as vote “against” | No effect | |
3. Ratification of Independent Registered Public Accounting Firm | page 9 | Majority of | Yes | Counted as | ||
| vote “against” | Counted as vote “against” |
Director Nominees
Our board of directors consists of three staggered classes of directors, designated as Class I, Class II, and Class III. The fourthree members of Class II, Thomas K. Corrick, RichardIII, Steven C. Cooper, Karen E. Gowland, and David H. Fleming, Mack L. Hogans and Christopher J. McGowan,Hannah, are standing for election as directors at the Annual Meeting,annual meeting, to hold office for three-year terms expiring in 2021.2022. The following table provides summary information about each of these director-nominees.director nominees. During 2017,2018, Messrs. Corrick, Fleming, HogansCooper and McGowanHannah and Ms. Gowland were directors for the entire year and attended 100% of the board and committee meetings on which they served. Our board of directors recommends a
PROXY SUMMARY STATEMENT
Director Name and Age | Director Since | Occupation | Independent | Committee Memberships | Other Public Company Boards | ||
| Audit | Compensation | ||||||
Steven C. Cooper Age - | |||||||
| Chairman of the Board and Retired | X | X | |||||
Karen E. Gowland Age - | 2014 | Retired | X | X | None | ||
David H. Hannah Age - 67 | 2014 | Retired Executive Chairman Reliance Steel & Aluminum Co. | X | ||||
| X | X | Reliance Steel & Aluminum Co. | |||||
2018 Select Performance Highlights
2018 Business Highlights
| 1. | Our Building Materials Distribution business successfully purchased and integrated three new facilities in Nashville, Tennessee, Medford, Oregon, and Cincinnati, Ohio toward its strategy of expanding its footprint. |
| 2. | The Company returned $55.5 million to shareholders through quarterly and additional dividends, and share repurchases. |
| 3. | To further our goal of reducing our exposure to legacy pension obligations, the transfer of $276.6 million of our pension plan assets to The Prudential Insurance Company of America (Prudential) for the purchase of group annuity contracts, under which, Prudential assumed ongoing responsibility for administration and benefit payments for all plan participants in payout status as of July 1, 2018. The transfers comprised over 60% of our U.S. qualified pension plan projected benefit obligations. |
| 4. | In 2018, to better focus the Company on its key businesses, we took the following strategic actions (Strategic Actions): |
| ● | The sale of three manufacturing facilities that produce lumber and particleboard in Northeast Oregon; |
| ● | The permanent curtailment of laminated veneer lumber (LVL) production at our Roxboro, North Carolina facility due to high manufacturing costs (we continue to manufacture I-joists at Roxboro); and |
| ● | The sale of a hardwood plywood manufacturing facility in Moncure, North Carolina, with actual closure of the sale occurring first quarter 2019. |
Executive Compensation Advisory Vote
We are asking shareholders to approve, on a nonbinding advisory basis, the overall executive compensation for our named executive officers. Our board of directors recommends a
| We target |
| We provide at-risk pay opportunities in the form of short-term and long-term incentives. |
| ● | Short-term and long-term incentives comprise a significant portion of each |
| Long-term performance is the most important measure of our success because we manage our operations and business affairs for the long-term benefit of our shareholders. |
| ● | For |
| Under our clawback policy, the board is able to clawback both short-term and long-term incentive awards in the event of a substantial restatement of financial statements or officer or employee intentional misconduct or malfeasance. |
| Our annual incentive compensation opportunities are tied to achievement of corporate and, in some cases, divisional financial goals. |
| We provide limited perquisites, including only those benefits that are consistent with market practice. |
| We prohibit our officers from participating in any hedging, pledging, or monetizing transaction to lock in the value of our common stock that they hold. |
Say on Pay For the five years following our initial public offering in February 2013, our shareholders have shown strong support |
We ask that our shareholders approve, on an advisory basis, the compensation of our named executive officers as further described in proposal 2. (Page 8)
2018 Key Compensation Actions and distribution of RSUs one year from the date of grant.
| · | 2018 PSUs under our Long-Term Incentive Plan (“LTIP”) earned at target yielding a 100% payout based on achieving target ROIC measures. These awards were granted in 2018, payment was determined in February 2019, and shares will be distributed in March 2021, three years from the grant date. |
| · | The Strategic Actions and the pension risk transfer transactions resulted in four non-routine changes in 2018 that were excluded from EBITDA(1) and ROIC(2) for purposes of calculating payouts under the Short-Term Incentive Plan (STIP) and LTIP. |
| (1) | EBITDA is defined as income before interest (interest expense and interest income), income tax provision (benefit), and depreciation and amortization and is not required by or presented in accordance with generally accepted accounting principles (GAAP) in the United States. Adjusted EBITDA further adjusts EBITDA to exclude the change in fair value of interest rate swaps and loss on extinguishment of |
Name and Principal Position | Base Salary ($) | Stock Awards ($) | Bonus ($) | Non-Equity Incentive Plan Compensation ($) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) | All Other Compensation ($) | Total ($) | |||||||||||||
| Thomas K. Corrick | $ | 819,038 | $ | 1,821,277 | — | $ | 1,318,652 | $ | 78,586 | $ | 109,364 | $ | 4,146,917 | |||||||
| Chief Executive Officer | ||||||||||||||||||||
| Wayne M. Rancourt | 481,962 | 528,746 | — | 581,969 | 145,909 | 58,072 | 1,796,658 | |||||||||||||
| Executive Vice President, | ||||||||||||||||||||
| Chief Financial Officer & | ||||||||||||||||||||
| Treasurer | ||||||||||||||||||||
| Nick Stokes | 462,308 | 587,499 | — | 702,708 | 121,674 | 77,323 | 1,951,512 | |||||||||||||
| Executive Vice President, | ||||||||||||||||||||
| Building Materials | ||||||||||||||||||||
| Distribution | ||||||||||||||||||||
| Dan Hutchinson | 416,731 | 587,499 | — | 473,406 | 39,917 | 50,530 | 1,568,083 | |||||||||||||
| Executive Vice President, | ||||||||||||||||||||
| Wood Products | ||||||||||||||||||||
| John T. Sahlberg | 444,846 | 470,021 | — | 465,531 | 42,249 | 55,651 | 1,478,298 | |||||||||||||
| Senior Vice President, | ||||||||||||||||||||
| Human Resources, General | ||||||||||||||||||||
| Counsel & Secretary | ||||||||||||||||||||
| (2) | ROIC, for any period means Net Operating Profit After Taxes (NOPAT) divided by average invested capital. NOPAT means net income plus after-tax financing expense. Invested capital means capitalized lease expense plus total assets, less current liabilities excluding short-term debt. Average invested capital means a rolling thirteen month average of invested capital. |
| · | The compensation committee further determined to include 50% of the negative impact of the Roxboro curtailment charges in ROIC for the chief executive officer and chief financial officer, which resulted in the reduction in the value of Thomas Corrick’s and Wayne Rancourt’s 2018 PSU awards by 3,159 and 929 shares, respectively. |
Ratification of Independent Registered Accounting Firm
We are asking our shareholders to ratify the appointment of KPMG LLP as our independent auditor for the year ending December 31. 2018. Our board of directors recommends a
PROPOSALS TO BE VOTED ON
Our board of directors consists of three staggered classes of directors, designated as Class I, Class II, and Class III. The director members of, and the term expiration dates for, each class are:
| Class | Director Members | Term Expiration Date |
| I | ||
| Thomas E. Carlile | 2020 annual shareholders’ meeting | |
| Kristopher J. Matula | ||
| Duane C. McDougall | ||
| II | Thomas K. Corrick | |
| Richard H. Fleming | ||
| Mack L. Hogans | ||
| Christopher J. McGowan | ||
| III | Steven C. Cooper | 2019 annual shareholders’ meeting |
| Karen E. Gowland | ||
| David H. Hannah | ||
At each succeeding annual shareholders'shareholders’ meeting, successors to the class of directors whose term expires at that annual meeting will be elected for a three-year term. Each director will hold office for the term to which he or she is elected and until his or her successor is duly elected and qualified or until his or her earlier death, disqualification, resignation, or removal.
Director Nominees
Three nominees, Ms. Gowland and Messrs. Corrick, Fleming, HogansHannah and McGowanCooper, are standing for election as directors at the Annual Meetingannual meeting to hold office for a three-year term expiring in 2021.
Shares will be voted according to yourshareholder instructions. If you do not provideno voting instructions yourare provided, a broker may not vote on thisthe matter. For 2018,2019, our director nominees are running unopposed. Therefore, to be elected to our board of directors in 2018,2019, each director-nomineedirector nominee must receive aan affirmative vote of the majority of the votes cast by our shareholdersof the shares present in person or by proxy at the meeting of the stockholders and entitled to vote.
The four director-nomineesthree director nominees have confirmed their availability for election. If any of the director-nomineesdirector nominees becomes unavailable to serve as a director for any reason prior to the Annual Meeting,annual meeting, our board of directors may substitute another person as a director nominee. In that case, if you havea shareholder has voted for the original nominee, yourthose shares will be voted
Additional information follows for the four director-nomineesthree director nominees and the directors continuing in office, particularly concerning their business experience and qualifications, as well as attributes and skills that led our board to conclude that such person should serve as a director of the Company. During the past ten years, none of our directors has been a party to any legal or bankruptcy proceedings reportable under SEC rules.
Our board of directors unanimously recommends shareholders vote FOR Ms. Gowland and Messrs. Hannah and Cooper, our three director nominees. |
| DirectorNominees | |
STEVEN C. COOPER Age: 56 Director Since: 2015 | Biographical Information: Mr. Cooper is an independent director and currently serves as a member of our audit committee. Mr. Cooper is currently the chairman of the board and retired chief executive officer of TrueBlue, Inc., a New York Stock Exchange-listed industrial staffing company based in Tacoma, Washington. Prior to joining TrueBlue in 1999, Mr. Cooper held various professional positions at Arthur Andersen, Albertsons, and Deloitte. Qualifications: Mr. Cooper’s experience as a chief executive officer and, as a director, provides insight on strategic and operational issues and valuable business knowledge. He also provides strong accounting and financial expertise and experience in workforce management to our board. |
PROPOSALS TO BE VOTED ON
KAREN E. GOWLAND Age: 60 Director Since: 2014 | Biographical Information: Ms. Gowland became one of our directors in January 2014. Ms. Gowland is an independent director and currently serves as the chair of the compensation committee and as a member of our corporate governance and nominating committee. Before her retirement in March 2014, Ms. Gowland was the senior vice president, general counsel and corporate secretary for Boise Inc. from August 2010 until its acquisition by Packaging Corporation of America in late 2013. Boise Inc. was a manufacturer of packaging and paper products. From February 2008 to July 2010, she served as Boise Inc.’s vice president, general counsel and secretary. From October 2004 to February 2008, Ms. Gowland served as vice president, general counsel and corporate secretary of Boise Cascade, L.L.C. During her 30 years in the forest products industry, Ms. Gowland held various legal and compliance positions, which included over 15 years of experience as a corporate secretary for various public and private entities in the forest products industry. Qualifications: Ms. Gowland has relevant industry and company experience and provides strong corporate governance and compliance skills to our board of directors. |
DAVID H. HANNAH Age: 67 Director Since: 2014 | Biographical Information: Mr. Hannah is an independent director and currently serves as a member of our compensation and corporate governance and nominating committees. Mr. Hannah is currently a director and formerly the chief executive officer and executive chairman of Reliance Steel & Aluminum Co., a New York Stock Exchange listed operator of metals service centers. Prior to joining Reliance in 1981, Mr. Hannah held various professional positions at Ernst & Whinney, a predecessor firm to Ernst & Young, LLP. Mr. Hannah is a certified public accountant. Mr. Hannah is currently a director of Reliance Steel & Aluminum Co. Qualifications: Mr. Hannah’s experience as a chief executive officer of a major distribution company provides valuable insight on operational and industry issues. He also provides strong accounting and financial expertise to our board. |
| Directors Continuing in Office | |
THOMAS E. CARLILE Age: 67 Director Since: 2015 | Biographical Information: Mr. Carlile has been one of our directors since our initial public offering in February 2013, and was a director of our former parent company, Boise Cascade Holdings, L.L.C., from 2009-2013. He is not an independent director and serves on no committees. Before his retirement in 2015, Mr. Carlile served as the Company’s chief executive officer from 2009 to 2015, and Qualifications: Mr. Carlile’s position as our former chief executive officer with 42 years experience with the Company and its predecessors allows him to advise the board of directors on operational and industry matters affecting the Company. |
THOMAS K. CORRICK Age: 63 Director Since: 2016 | Biographical Information: Mr. Corrick is not an independent director, and has served as our chief executive officer since March 6, 2015. He serves on no committees. Prior to that, he served in various roles including chief operating officer, executive vice president of our Wood Products segment, senior vice president of engineered wood products in our Wood Products segment, and various other management and financial positions. Qualifications: Mr. Corrick has over 36 years of experience with the Company and its predecessor which enables him to provide valuable insight on the Company, its culture, and the governance and financial controls in the Company. As chief executive officer, he is also able to provide operational and financial information that is critical to board discussions. |
RICHARD H. FLEMING Age: 71 Director Since: 2013 | Biographical Information: Mr. Fleming is an independent director and currently serves as a member of our audit committee. Mr. Fleming was the executive vice president and chief financial officer of USG Corporation from 1999 until his retirement in 2012. USG is a manufacturer of high performance building systems for the construction and remodeling industries. Prior to joining USG, Mr. Fleming was employed by Masonite Corporation, which was acquired by USG in 1984. During his 39-year career with Masonite and USG, Mr. Fleming held various operating and finance positions and was USG’s chief financial officer for approximately 18 years. Mr. Fleming is the board chair of Columbus McKinnon Corporation. Qualifications: Mr. Fleming provides strong financial skills to our board of directors, has relevant industry experience, and has served as a director since 2013, which provides him with knowledge of our history as a public company. |
MACK L. HOGANS Age: 70 Director Since: 2014 | Biographical Information: Mr. Hogans is an independent director and currently serves as the chair of our corporate governance and nominating committee and as our lead independent director. Mr. Hogans was senior vice president of corporate affairs with Weyerhaeuser Company, a New York Stock Exchange-listed timberlands and wood products company, until his retirement in 2004. Mr. Hogans currently operates a consulting services business. Prior to joining Weyerhaeuser in 1979, Mr. Hogans was employed by the U.S. Forest Service, Maryland National Capital Parks & Planning Commission, and the National Park Service. Qualifications: Mr. Hogans has relevant industry experience and provides strong corporate governance and compliance skills to our board of directors. |
KRISTOPHER J. MATULA Age: 56 Director Since: 2014 | Biographical Information: Mr. Matula Qualifications: Mr. Matula’s experience as president, chief operating officer, and director provides insight on strategic and operational issues, and valuable business knowledge. He also provides relevant industry experience and strong corporate governance and compliance skills to our board of directors. |
DUANE C. MCDOUGALL Age: 67 Director Since: 2013 | Biographical Information: Mr. McDougall is an independent director and currently serves on our audit and compensation committees. Mr. McDougall was the board chairman of Boise Cascade Holdings, L.L.C. from December 2008, and also was a director of Boise Cascade Holdings, L.L.C. from 2005 to 2013. He became a Boise Cascade Company director and board chairman in February 2013 in connection with our initial public offering. Mr. McDougall also served as an interim chief executive officer of Boise Cascade, L.L.C. from December 2008 to August 2009. Prior to joining our company, Mr. McDougall was president and chief executive officer of Willamette Industries, an international paper and forest products company, until its sale in 2002. During his 23-year career with Willamette, Mr. McDougall held numerous operating and finance positions with increasing responsibilities before becoming president and chief executive officer. Mr. McDougall is a current director of The Greenbrier Companies, Inc., and StanCorp Financial Group, Inc., and a prior director of Cascade Corporation. Qualifications: Mr. McDougall’s experience as a chief executive officer of a major forest products company provides our board of directors with valuable insight on operational and industry issues. He also provides strong accounting and financial expertise to our board. |
CHRISTOPHER J. MCGOWAN Age: 47 Director Since: 2013 | Biographical Information: Mr. McGowan is an independent director and currently serves as the chair of our audit committee. He became a Boise Cascade Company director in February 2013 in connection with our initial public offering. Prior to February 2013, he was a director of our former parent company, Boise Cascade Holdings, L.L.C., from 2004 to 2013. In August 2014, he became a general partner of CJMV-GMC-AHSS, L.P. (d/b/a Autism Home Support Services, Inc.), a provider of therapy and counseling services for children with autism. In 2012, Mr. McGowan began teaching at The University of Chicago Booth School of Business and currently serves as an Adjunct Professor, Investor in Residence, and Faculty Adviser. In September 2011, he became a general partner of CJM Ventures, L.L.C. and OPTO Holdings, L.P. (d/b/a/ OPTO International, Inc.). From 1999 until 2011, he was employed by Madison Dearborn Partners, L.L.C. and served as a managing director concentrating on investments in the basic industries sector. Prior to joining Madison Dearborn, Mr. McGowan was with AEA Investors, Inc. and Morgan Stanley & Co. Incorporated. Mr. McGowan is the current director of Cedar Capital, LLC (a registered investment adviser that operates registered investment companies), and a prior director of Smurfit Kappa Group Ltd. (formerly known as Jefferson Smurfit Group). Qualifications: Mr. McGowan provides strong financial and governance skills to our board of directors and has served as a director since 2013, which provides him with knowledge of our history as a public company. |
Pursuant to Section 14A of the Securities Exchange Act of 1934 (Exchange Act), we are providing our shareholders with the opportunity to cast a nonbinding advisory vote regarding the compensation of our named executive officers. Our compensation philosophy is designed to emphasize a focus on total compensation, with a large portion of our named executive officers'officers’ pay being performance-based and considered variable, "at“at risk,"” and aligned with shareholder interests. We seek to pay for performance so that we can recruit and retain the talented employees necessary to drive superior financial and operational results. We view our compensation program as a strategic tool that supports the successful execution of our business strategy and reinforces a performance-based culture. Our board of directors has agreed to hold this nonbinding advisory vote on an annual basis, with the next vote expected to occur at the 2020 annual meeting of shareholders.
Shareholders are urged to read the Compensation Discussion and Analysis section in this proxy statement, which discusses how our compensation policies and procedures implement our compensation philosophy. The compensation committee and our board of directors believe these policies and procedures are effective in implementing our compensation philosophy and in achieving its goals. Our board of directors has determined the best way to allow shareholders to vote on our executive compensation is through the following resolution:
RESOLVED, that the compensation paid to the Company'sCompany’s named executive officers, as disclosed in the
Your vote is important to us.
Although this advisory vote is nonbinding, the compensation committee and our board of directors will review the results of the vote. The compensation committee will consider ourOur board of directors unanimously recommends shareholders vote, on a nonbinding advisory basis, FOR the approval of the resolution set forth above approving the compensation of our named executive officers. |
The audit committee of our board of directors is responsible for the engagement of our independent auditor and has appointed KPMG LLP (KPMG) in that capacity, effective February 21,
Although ratification is not required by our bylaws or otherwise, our board of directors is submitting the selection of KPMG to our shareholders for ratification because we value our shareholders'shareholders’ views on our independent registered public accounting firm and as a matter of good corporate practice.firm. If the appointment of KPMG is not ratified, the audit committee will evaluate the basis for the shareholders
It is expected that one or more representatives of KPMG will be present at our Annual Meetingannual meeting to answer questions. They will also have the opportunity to make a statement if they desire to do so.
For information on the services KPMG has provided for us in 2017,2018, please refer to the following table:
| Our board of directors unanimously recommends shareholders vote FOR the ratification of the appointment of KPMG as our independent registered public accounting firm for the year ending December 31, 2019. |
| 2017 | ||||
| Audit Fees | $ | 2,189,996 | ||
| Audit-Related Fees | 9,500 | |||
| Tax Fees | 55,400 | |||
| All Other Fees | — | |||
| Total | $ | 2,254,896 | ||
In 2018, we revised the Boise Cascade Company Code of Ethics (Code of Ethics) that applies to our directors and all of our employees.employees to make it easier to read and provide more explanation and examples. We have a toll-free reporting service available that permits employees to confidentially report violations of our Code of Ethics or other issues of significant concern. We have an email link to our board on our website by selecting
If we amend or grant a waiver of one or more of the provisions of our Code of Ethics, we intend to satisfy the requirements under Item 5.05 of Form 8-K regarding the disclosure of amendments to or waivers from provisions of our Code of Ethics by posting the required information on our website.
You may view a copy of our Code of Ethics by visiting our website at www.bc.com and selecting
Investors at the bottom of the page,then Code of Ethics.Our board of directors has adopted Corporate Governance Guidelines (Guidelines) to assist the board in exercising its responsibilities. The Guidelines reflect our board'sboard’s commitment to monitor the effectiveness of policy and decision making,decision-making, both at the board and management levels. Our board of directors believes the Guidelines will enhance our ability to achieve our goals and long-term success and
You may view a complete copy of the Guidelines by visiting our website at www.bc.com and selecting Investors, then Leadership and Governance, and then Corporate Governance Guidelines.
Our directors believe board independence is important and is key for the board to function properly, allowing it to provide appropriate oversight and maintain managerial accountability.
We list our common stock on the NYSE. The NYSE rules require that a majority of our directors be independent from management and all members of our board committees be independent. For a director to be independent under the NYSE'sNYSE’s rules, our board must determine affirmatively that he or she has no material relationship with us. Additionally, he or she cannot violate any of the bright line independence tests set forth in the NYSE listing rules that would prevent our board of directors from determining that he or she was independent. These rules contain heightened independence tests for members of our audit and compensation committees. Our board of directors will broadly consider all relevant facts and circumstances to determine the independence of any director, in accordance with the NYSE listing rules.
To assist in making this determination, our board adopted the NYSE'sNYSE’s independence standards, set forth in the NYSE listing rules and Rules 10A-3 and 10C-1 under the Exchange Act. For purposes of these standards, we include Boise Cascade Company and its consolidated subsidiaries.
Our board has determined that Ms. Gowland and Messrs. Cooper, Fleming, Hannah, Hogans, Matula, McDougall, and McGowan are independent directors as defined under the NYSE'sNYSE’s listing standards. These directors constitute a majority of our board of directors and represent all of our committee members. In making its independence determination, our board considered the relationships disclosed in the
Additionally, our board of directors has determined that (i) each member of the audit committee meets the heightened independence standards for audit committee service under the NYSE listing rules and Rule 10A-3 under the Exchange Act; and (ii) each member of the compensation committee meets the heightened independence standards for compensation committee service under the NYSE listing rules and Rule 10C-1 under the Exchange Act.
Our board of directors and its committees can retain, at their sole discretion and at our expense, independent financial, legal, compensation, or other advisors to represent the independent interests of our board of directors or its committees.
Section 16(a) of the Exchange Act requires our officers, directors, and persons who beneficially own more than ten percent of our common stock to file reports of securities ownership and changes in such ownership with the SEC.Securities and Exchange Commission (SEC). Officers, directors, and greater than ten percent beneficial owners also are required by rules promulgated by the SEC to furnish us with copies of all Section 16(a) forms they file.
Based on a review of such reports, we believe that in 2017,2018, all Section 16(a) filing requirements were complied with by our officers, directors, and greater than ten percent beneficial owners, except for one transaction by Duane McDougall relating to a donation of shares he made to a 501(c)(3) charitable entity on September 1, 2016. The applicable Form 5 was not filed within the filing deadline, but a Form 4 was filed on June 15, 2017 reflecting the donation.
Family Relationships
No family relationships exist between any of our directors and executive officers.
Affiliated-Company Transactions
Mr. Cooper, one of our directors, iswas the president and chief executive officer of TrueBlue, Inc. (TrueBlue), an industrial staffing company.company, until December 31, 2018, and he remains its board chair. In 2017,2018, the Company leased commercial drivers and used other temporary labor services from TrueBlue and its subsidiaries and paid approximately $482,000$470,000 for those services
Policies and Procedures for Related-Person/Party Transactions
Our written policy regarding transactions with related persons requires that a "related person"“related person” (as defined in paragraph (a) of Item 404 of Regulation S-K) must promptly disclose to our general counsel any "related“related person transaction"transaction” (defined as any transaction that is reportable by us under Item 404(a) of Regulation S-K in which we are or will be a participant and the amount involved exceeds $120,000, and in which any related person has or will have a direct or indirect material interest) in which such related person has or will have a direct or indirect material interest and all material facts with respect thereto. The general counsel will promptly communicate such information to our audit committee or another independent body of our board of directors. No related-person transaction will be entered into without the approval or ratification of our audit committee or another independent body of our board of directors. It is our policy that directors recuse themselves from any discussion or decision affecting their personal, business, or professional interests. Our policy does not specify the standards to be applied by our audit committee or another independent body of our board of directors in determining whether to approve or ratify a related-person transaction. We accordingly anticipate that these determinations will be made in accordance with Delaware law
The compensation committee has retained Frederic W. Cook & Co., Inc. (FW Cook), as its independent, compensation consultant to assist the committee in discharging its responsibilities. Prior to retaining FredericFW Cook, the compensation committee considered that FredericFW Cook does not provide any other services to the Company or its executive officersmanagement and determined that there was no conflict of interest according to the factors the compensation committee determined to be relevant, including the independence factors enumerated by the NYSE.
Our board of directors oversees the risk management activities designed and implemented by our management. The board of directors executes its oversight responsibility for risk management both directly and through its committees. Through our enterprise risk management review, and with general meeting content, the board of directors also considers specific risk topics, including risks associated with our strategic plan, business operations, cybersecurity, and capital structure. In addition, the board of directors receives detailed regular reports from members of our senior management and other personnel that include assessments and potential mitigation of the risks and exposures involved with their respective areas of responsibility.
Our board of directors delegates to the audit committee oversight of our risk management process. Our other board committees also consider and address risk as they perform their respective committee responsibilities. All committees report to the full board of directors as appropriate, including when a matter rises to the level of a material- or enterprise-level risk.
Our internal audit department annually develops a risk-based audit plan that is reviewed with the audit committee, along with the results of internal audit reviews and activities. The internal audit department also maintains a high level assessment of risks and controls for key operations, functions, processes, applications, and systems within the Company. The audit committee meets a number of times each year with our director of internal audit, our chief financial officer, and our controller.
We also have in place a number of independent assurance activities responsible for assessing whether our risk response activities are in place and working effectively. These assurance activities include, but are not limited to, corporate legal audits, corporate data security, environmental audits, and safety audits.
We reviewed our compensation policies and practices for our employees and determined these policies and practices do not induce our employees to take unacceptable levels of business risk for the purpose of increasing their incentive plan awards at the expense of shareholder interests. Some of the considerations in making this determination were:
| None of our businesses presents a high risk profile because a very large percentage of our revenues and income is derived from commodity products; |
| Our incentive pay structure rewards performance in both the short and long term (i.e., short-term incentives are not paid out at the expense of long-term shareholder value); |
| Our incentive pay program has |
| The compensation committee reserves the right to reduce or eliminate any awards, in its discretion, with respect to our incentive pay programs; |
| We have adopted a clawback policy for our equity-based |
| Our executive compensation program does not encourage our management to take unreasonable risks relating to the |
| ● | We prohibit our officers from participating in any hedging, pledging, or monetizing transactions to lock in the value of our common stock that they hold. |
Our corporate governance and nominating committee is responsible for, among other matters:
| ● | Identifying individuals qualified to become members of our board of directors, consistent with criteria approved by our board of directors; |
| ● | Recommending to our board a slate of director nominees for election or re-election at the annual meeting; and |
| ● | Recommending to our board of directors persons to fill board and committee vacancies. |
Through this process, members of the corporate governance and nominating committee consult with our board chair and accept nominee recommendations from other directors and/or shareholders in accordance with the terms of our Certificate of Incorporation and our bylaws. The invitation to join our board of directors is extended by our board of directors through our board chair. Our lead independent director serves as the chair of our corporate governance and nominating committee.
Suitability of Candidates
In evaluating the suitability of candidates, in addition to our ongoing and emerging business needs, our board of directors and corporate governance and nominating committee consider many factors, including a candidate's:candidate’s:
| ● | Experience as a senior officer in a public company, or substantial private company, or other comparable experience; |
| ● | Experience as a director of a public company; |
| ● | Breadth of knowledge about issues affecting the Company and/or its industry; |
| ● | Expertise in finance, logistics, manufacturing, law, human resources, or marketing or other areas that our board determines are important areas of needed expertise; and |
| ● | Personal attributes that include integrity and sound ethical character, absence of legal or regulatory impediments, absence of conflicts of interest, demonstrated track record of achievement, ability to act in an oversight capacity, appreciation for the issues confronting a public company, adequate time to devote to our board of directors and its committees, and willingness to assume broad/fiduciary responsibilities on behalf of all shareholders. |
The corporate governance and nominating committee is committed to nondiscrimination in its selection practicesa highly functioning board where the composition is reflective of the long-term strategy of the business, and makes decisions primarily on the basis of skills, qualifications, and experience.
Consideration of Diversity in Nomination Process
Our current board has a rich mixture of educational, professional, and experiential diversity. As opportunities to appoint new directors become available in the future, in addition to the factors set forth above, our board of directors will consider other factors, including gender, racial, ethnic, and global diversity for director recruitment.
Shareholder Nominations for Directors
In accordance with our bylaws, however, the corporate governance and nominating committee will consider shareholder nominations for directors (please refer to the
Our directors conduct annual self-evaluations of our board of directors and its committees. These evaluations assess the overall effectiveness of our board of directors. The chairman of the board reviewsand lead independent director review the directors'directors’ responses and providesprovide the individual board members, the corporate governance and nominating committee, and the full board with an assessment of the performance of the board and its committees. The directors then discuss the results and proposed actions in executive session. The purpose of the evaluation is to increase the effectiveness of our board, its committees, and our directors.
The board believes that wider perspective and best practices learned by board members serving in other public directorships must be balanced against the time commitment that service on boards entails. Therefore, our Corporate Governance Guidelines (Guidelines) include an overboarding policy whereby our non-employee directors are limited to no more than three public boards, in addition to ours, and our chief executive officer to one additional public board. You can view the Guidelines by visiting our website at www.bc.com and selecting
Shareholders and other interested parties may contact our board of directors, or any of its committees, non-management directors or any individual directors by writing to the chairman of the corporate governance and nominating committee, in care of the chief financial officer at the address or email address shown below. All correspondence will be referred to the chairman of the governance and nominating committee, the chairman of the board, and our general counsel.
Boise Cascade Company
Attention
: Chairman of the Corporate Governance and Nominating Committeec/o Chief Financial Officer
1111 West Jefferson Street, Suite 300
Boise, ID 83702
Email: legaldepartment@bc.comlegaldepartment@bc.com
Shareholders and other interested parties may also contact our board of directors by email by going to our website, www.bc.com, and selecting
Currently the positions of chairman and chief executive officer are filled separately. Our board of directors believes that this structure is appropriate for the Company at this time. Mr. Carlile
On February 4, 2013, our corporate governance and nominating committee and our board of directors adopted the Guidelines to serve as a flexible framework within which the board conducts business. The committee and board routinely review the Guidelines with the most recent review occurring on February 22, 2018. On October 28, 2015, our board formalized our practice that the chair of the governance and nominating committee serves as the lead independent director. Mack Hogans currently fills the lead independent director role. Our lead independent director presides over all meetings of the independent directors and works collaboratively with our chairman and chief executive officer regarding board governance, including the board evaluation process and establishing meeting agendas for our board.
Our board of directors and each of our committees routinely meet in executive sessions outside the presence of management. Mr. Carlile, our chairman of the board, presides over the executive sessions of our board of directors, and each committee chair presides over the executive sessions of each respective committee. Mr. Hogans, our lead independent director, and the chair of our corporate governance and nominating committee, and our lead independent director, presides over the sessions of our independent board members who meet outside the presence of our non-independent directors at least twice per year to discuss matters as they deem appropriate.
During 2017,2018, our board of directors met fourfive times in person and oncefour times by telephone conference. Our board also acted pursuant to written resolution on one occasionfive times during 2017.2018. In addition to meetings of the full board, our board committees met a total of 14 times. As a group, our directors had an overall attendance rate of 100%98%.
Under the Guidelines, our directors are expected to attend our Annual Meetingannual meeting to be held on May 3, 2018. All2, 2019. Nine of theour ten directors on the board attended the 2017 Annual Meeting.
Our board of directors has established the following three standing committees:
| ● | Audit Committee |
| ● | Compensation Committee |
| ● | Corporate Governance and Nominating Committee |
The composition, duties, and responsibilities of these committees are outlined in written charters adopted by our board of directors. Each committee charter is reviewed annually by its respective committee to ensure ongoing compliance with applicable laws and sound governance practices and reviewed
You may view copies of our committee charters by visiting our website at www.bc.com and selecting
Investors at the bottom of the page and thenLeadership and Governance. You are then able to select any of the committee charters.Audit Committee
Committee Members (1) | 2018 Committee Meeting Attendance (2) |
Christopher J. McGowan, committee chair(3) | 100% |
Steven C. Cooper (3) | 100% |
Richard H. Fleming (3) | 100% |
Duane C. McDougall (3) | |
| 75% |
(1) | All members of the audit committee are independent as defined under the applicable NYSE listing standards and in accordance with Rule 10A-3 under the Exchange Act, as determined by our board of directors. |
| (2) | The audit committee met |
| (3) | Our board of directors has determined that Messrs. McGowan, Cooper, Fleming, and McDougall are audit committee financial experts, as defined in Item 407(d)(5) of Regulation S-K under the Securities Act. |
The audit committee of our board of directors is responsible for matters including the following:
| integrity of the Company’s |
| Discussing with management our overall risk assessment and risk management policies; |
Reviewing disclosures made by our chief executive officer and chief financial officer regarding any significant deficiencies or material weakness in the design or operation of the and |
Reviewing the scope and staffing of the independent auditors annual audit, discussing all matters required by PCAOB management’s response. |
For a complete description of our audit committee'scommittee’s responsibilities, you may view a copy of our audit committee charter by visiting our website at www.bc.com and selecting
Compensation Committee
Committee Members (1) | 2018 Committee Meeting Attendance Rate (2) |
Karen E. Gowland, committee chair | 100% |
| David H. Hannah | 100% |
| Kristopher J. Matula | 100% |
Duane C. McDougall | 100% |
| (1) | All members of the compensation committee are independent as defined under the applicable |
| (2) | The compensation committee met |
The compensation committee of our board of directors is responsible for matters including the following:
| Assisting our board of directors in discharging its responsibilities relating to compensation of our board members, chief executive officer, and other executive officers; |
| Reviewing and approving employment agreements and other similar arrangements between the Company and our chief executive officer and other executive officers; |
| Reviewing and evaluating the |
Preparing the compensation committee report on executive officer compensation required by the SEC for inclusion in the Report. |
For a complete description of our compensation committee'scommittee’s responsibilities, you may view a copy of our compensation committee charter by visiting our website at www.bc.com and selecting
Corporate Governance and Nominating Committee
Committee Members (1) | 2018 Committee Meeting Attendance Rate (2) |
Mack L. Hogans, committee chair | 100% |
| Karen E. Gowland | 100% |
| David H. Hannah | 100% |
| Kristopher J. Matula | 100% |
| (1) | All members of the corporate governance and nominating committee are independent as defined under the applicable |
| (2) | The corporate governance and nominating committee of our board of directors met in person four times during |
The corporate governance and nominating committee of our board of directors is responsible for matters including the following:
| Identifying and assessing persons qualified to become board members, consistent with the qualification standards and criteria approved by the board; |
| Recommending to the board a slate of director nominees for election or re-election at the |
| Recommending to the board the structure and membership of board committees; |
| Recommending to the board persons to fill board and committee vacancies; |
| Overseeing annual evaluations of the board and committees of the board; |
| Reviewing periodically the Guidelines applicable; and |
| Making other recommendations to the board relative to corporate governance issues. |
For a complete description of our corporate governance and nominating committee'scommittee’s responsibilities, you may view a copy of our corporate governance and nominating committee charter by visiting our website at www.bc.com and selecting
Employee board members do not receive compensation for their service on our board of directors. Mr. Corrick is currently our only employee board member. Nonemployee board members in 20172018 were entitled to receive the compensation described below under "2017 Director“Director Fees."
The following table presents compensation information for each of our nonemployee directors for the year ended December
31,| Name | Fees Earned or Paid in Cash ($) (1) | Stock Awards ($) (2) | Change in Pension Value/ Nonqualified Deferred Compensation Earnings ($) (3) | All Other Compensation ($) | Total ($) | |||||||||||||||
| Thomas E. Carlile | $ | 160,000 | $ | 114,990 | $ | — | $ | — | $ | 274,990 | ||||||||||
| Steven C. Cooper | 70,000 | 89,995 | 7,775 | — | 167,770 | |||||||||||||||
| Richard H. Fleming | 70,000 | 89,995 | — | — | 159,995 | |||||||||||||||
| Karen E. Gowland | 80,000 | 89,995 | 5,024 | — | 175,019 | |||||||||||||||
| David H. Hannah | 70,000 | 89,995 | — | — | 159,995 | |||||||||||||||
| Mack L. Hogans | 97,500 | 89,995 | — | — | 187,495 | |||||||||||||||
| Kristopher J. Matula | 70,000 | 89,995 | 8,792 | — | 168,787 | |||||||||||||||
| Duane C. McDougall | 70,000 | 89,995 | — | — | 159,995 | |||||||||||||||
| Christopher J. McGowan | 85,000 | 89,995 | — | — | 174,995 | |||||||||||||||
| Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2) | Change in Pension Value / Nonqualified Deferred Compensation Earnings ($)(3) | All Other Compensation ($) | Total ($) |
| Thomas E. Carlile | 160,000 | 114,987 | --- | --- | 274,987 |
| Steven C. Cooper | 70,000 | 90,018 | 4,793 | --- | 164,811 |
| Richard H. Fleming | 70,000 | 90,018 | --- | --- | 160,018 |
| Karen E. Gowland | 80,000 | 90,018 | 2,969 | --- | 172,987 |
| David H. Hannah | 70,000 | 90,018 | --- | --- | 160,018 |
| Mack L. Hogans | 97,500 | 90,018 | --- | --- | 187,518 |
| Kristopher J. Matula | 70,000 | 90,018 | 5,196 | --- | 165,214 |
| Duane C. McDougall | 70,000 | 90,018 | --- | --- | 160,018 |
| Christopher J. McGowan | 85,000 | 90,018 | --- | --- | 175,018 |
| (1) | The reported cash earnings include retainers and fees |
| (2) | On February |
| (3) | We do not provide our directors with pension benefits. |
Director Fees
The 2018 retainer and fee schedule for nonemployee directors was:
| Director Fees | 2017 | ||||||
| Director Fees (Annual): | |||||||
| Cash Retainer | $ | 70,000 | |||||
| Equity Award | $ | 90,000 | |||||
| Committee Chair Fees (Annual): | |||||||
| Audit | $ | 15,000 | |||||
| Compensation | $ | 10,000 | |||||
| Corporate Governance and Nominating | $ | 7,500 | |||||
| Lead Independent Director | $ | 20,000 | |||||
| Chairman | |||||||
| Additional Cash Retainer | $ | 90,000 | |||||
| Additional Equity Award | $ | 25,000 | |||||
| Director Fees | Effective 2018 ($) | Effective 2019 ($) |
| Director Fees (Annual) | ||
| Cash Retainer | 70,000 | 90,000 |
| Equity Award | 90,000 | 110,000 |
| Committee Chair Fees (Annual) | ||
| Audit | 15,000 | 20,000 |
| Compensation | 10,000 | 15,000 |
| Corporate Governance and Nominating | 7,500 | 10,000 |
| Lead Independent Director | 20,000 | 25,000 |
| Chairman (Annual) | ||
| Additional Cash Retainer | 90,000 | 100,000 |
| Additional Equity Award | 25,000 | 25,000 |
2018 Director Restricted Stock Unit Awards
Upon the recommendation of the compensation committee, our board of directors on February 22, 2018 approved the granting of 2,091 RSUs with a grant date fair value equal to $90,018 to each of our nonemployee directors. The board chairman received an additional 580 RSUs with a grant date fair value equal to $24,969. These 2018 RSU awards are service-condition vesting awards that vested in full on February 22, 2019 and were distributed on February 25, 2019.
Directors Deferred Compensation Plan
We maintain a “nonqualified” deferred compensation plan offered to our nonemployee directors. The plan is an unfunded plan intended to help participants supplement their retirement income while providing them an opportunity to invest a portion of their cash compensation. Under the plan, each director who receives cash compensation for board service may elect to defer all or a portion of his or her cash compensation in a calendar year. Amounts deferred are credited with imputed interest at a rate equal to 130% of Moody’s Composite Average of Yields on Corporate Bonds. Participants elect the form and timing of distributions of their deferred compensation balances. Participants may receive cash payment in a lump sum or in annual installments following their service on our board of directors. Ms. Gowland and Messrs. Matula and Cooper have elected to defer cash compensation in 2016 through 2018 under this plan. We do not anticipate making any changes to this plan in 2019.
Compensation Committee Interlocks and Insider Participation
During 2018, the compensation committee consisted of Ms. Gowland, Mr. Hannah, Mr. Matula, and Mr. McDougall. None of our executive officers currently serve, or in the past year served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our board of directors or compensation committee.
Stock Ownership Guidelines for Our Directors
In February 2014,August 2018, our board of directors updated the established Company stock ownership guidelines for our directors, which are intended to ensure that our directors acquire and maintain an equity stake in the Company and more closely align their interests with those of our shareholders.
Our director stock ownership guidelines provide that within five years from becoming a director, each director should acquire and maintain stock ownership in the Company equal to five times his or her annual cash retainer. As of March 2018, all of our board of directors met the ownership guidelines.
Stock Ownership Guidelines for Our Officers
In August 2018, our board of directors updated the established Company stock ownership guidelines for our officers which are intended to ensure that our officers acquire and maintain an equity stake in the Company and more closely align their interests with those of our shareholders.
Our officer stock ownership guidelines in February 2014 and updated them in November 2017. The ownership targetsprovide that within five years of the later of becoming an officer, or adoption of new guidelines, varythat the officer meet the guidelines. Ownership varies by officer level with the chief executive officer
Security Ownership of Certain Beneficial Owners and Management
Except as otherwise noted, the following table sets forth certain information with respect to the beneficial ownership of our common stock as of March 6, 20182019 by: (1) each of the named executive officers in the Summary Compensation Table; (2) each of our directors and director-nominees;director nominees; (3) all directors and executive officers as a group; and (4) each person or entity known to us to be the beneficial owner of more than five percent of our outstanding shares of common stock. All information with respect to beneficial ownership has been furnished to us by the respective director, director nominee, executive officer, or five percent beneficial owner, as the case may be. Unless otherwise noted below, the address of each beneficial owner is c/o Boise Cascade Company, 1111 West Jefferson Street, Suite 300, Boise, ID 83702. Unless otherwise indicated, each person or entity named below has sole voting and investment power with respect to the number of shares set forth opposite his, her or its name.
Name and Address of Beneficial Owner and Nature of Beneficial Ownership | Column | ||||||||
| A | B | C | |||||||
Shares Owned as of 3/6/18 (#)(1) | Right to Acquire Within 60 Days of 3/6/18 (#)(1) | Percent of Class (%)(2) | |||||||
| Persons Owning Greater Than 5% of Our Outstanding Common Stock: | |||||||||
BlackRock, Inc. (3) | 5,187,573 | — | 13.3% | ||||||
The Vanguard Group (4) | 3,903,620 | — | 10.0% | ||||||
Dimensional Fund Advisors LP (5) | 2,940,368 | — | 7.5% | ||||||
| Nonemployee Directors: | |||||||||
| Thomas E. Carlile | 49,945 | 9,847 | (6) | * | |||||
| Steven C. Cooper | 3,327 | 7,647 | (7) | * | |||||
| Richard H. Fleming | 8,327 | 12,309 | (8) | * | |||||
| Karen E. Gowland | 3,327 | 10,286 | (7) | * | |||||
| David H. Hannah | 3,327 | 8,479 | (7) | * | |||||
| Mack L. Hogans | 3,402 | 9,187 | (7) | * | |||||
| Kristopher J. Matula | 4,727 | 9,187 | (7) | * | |||||
| Duane C. McDougall | 16,127 | 12,309 | (8) | * | |||||
| Christopher J. McGowan | 25,540 | 12,309 | (8) | * | |||||
| Named Executive Officers: | |||||||||
| Thomas K. Corrick | 85,850 | 5,923 | (9) | * | |||||
| Wayne M. Rancourt | 37,260 | 9,872 | (9) | * | |||||
| Dan Hutchinson | 29,190 | 2,962 | (9) | * | |||||
| Nick Stokes | 31,376 | 5,923 | (9) | * | |||||
| John T. Sahlberg | 31,506 | — | * | ||||||
All Directors and Executive Officers as a Group (15 Persons) | 347,335 | 120,354 | 1.2% | ||||||
| Amount and Nature of Beneficial Ownership | ||||
| Name of Beneficial Owner | Column A Shares Owned as of 3/6/2019 (#)(1) | Column B Right to Acquire Within 60 Days of 3/6/2019 (#)(1) | Column C Percent of Class (%)(2) | |
| Persons Owning Greater Than 5% of Our Outstanding Common Stock | ||||
BlackRock, Inc. (3) | 6,215,192 | — | 15.9% | |
The Vanguard Group (4) | 4,901,527 | — | 12.5% | |
Dimensional Fund Advisors LP (5) | 3,177,418 | — | 8.1% | |
| Nonemployee Directors | ||||
| Thomas E. Carlile | 52,616 | 9,847 (6) | * | |
| Steven C. Cooper | 5,418 | 7,647 (7) | * | |
| Richard H. Fleming | 10,418 | 12,309 (8) | * | |
| Karen E. Gowland | 5,418 | 10,286 (7) | * | |
| David H. Hannah | 5,418 | 8,479 (7) | * | |
| Mack L. Hogans | 5,493 | 9,187 (7) | * | |
| Kristopher J. Matula | 6,818 | 9,187 (7) | * | |
| Duane C. McDougall | 18,218 | 12,309 (8) | * | |
| Christopher J. McGowan | 27,631 | 12,309 (8) | * | |
| Named Executive Officers | ||||
| Thomas K. Corrick | 129,586 | 5,923 (9) | * | |
| Wayne M. Rancourt | 50,719 | — | * | |
| Dan Hutchinson | 17,165 | — | * | |
| Nick Stokes | 46,889 | — | * | |
| John T. Sahlberg | 37,682 | — | * | |
All Directors and Executive Officers as a Group (18 Persons) | 471,780 | 97,483 | 1.5% | |
| (1) | Under SEC rules, a person is considered to beneficially own any shares over which they exercise sole or shared voting and/or investment power (Column A) plus any shares they have the right to acquire within 60 days of March 6, |
| (2) | Percent of class (Column C) is calculated by dividing the number of shares beneficially owned (Column A plus Column B) by the |
| (3) | Pursuant to Schedule 13G/A, Amendment No. |
| (4) | Pursuant to Schedule 13G/A, Amendment No. |
| (5) | Pursuant to Schedule 13G/A, Amendment No. |
| (6) | Mr. |
| (7) | Reported amount includes 2,639, 832, 1,540, and 1,540 restricted stock units |
| (8) | Reported amount includes 2,023, 2,639, 2,212, and 5,435 restricted stock units which vested on February 26, 2014, February 27, 2015, February 25, 2016, and February 24, 2017, |
| (9) | Represents shares issuable upon exercise of options that are currently exercisable. |
AUDIT COMMITTEE REPORT
The following is the report of the audit committee with respect to the Company'sCompany’s audited financial statements and internal controls over financial reporting (ICOFR) for the year ended December
Audit Committee Charter and Responsibilities
The audit committee assists the board of directors in its oversight of the quality and integrity of the Company'sCompany’s financial statements and its accounting and financial reporting practices. The audit committee'scommittee’s responsibilities are more fully set forth in its charter, which you can view by visiting our website at www.bc.com and selecting
In fulfilling its oversight responsibilities, the audit committee reviewed and discussed the Company'sCompany’s annual audited and quarterly consolidated financial statements, as well as the report over our ICOFR for the 20172018 calendar year with management and KPMG, the Company'sCompany’s independent auditor. The audit committee has discussed with KPMG the matters required to be discussed by the Statement on Auditing StandardsStandard No. 61, as amended (AICPA,
Audit Committee Financial Experts
The board of directors has determined that the audit committee chair, Christopher J. McGowan, and each of the other audit committee members, Steven C. Cooper, Richard H. Fleming, and Duane C. McDougall, and Steven C. Cooper, are audit committee financial experts, as defined in Item 407(d)(5) of Regulation S-K under the Securities Act. Our board of directors has also determined that Mr.
Recommendation of Financial Statements
Based on the review and discussions with management and KPMG, the audit committee recommended to the Company'sCompany’s board of directors that the Company'sCompany’s audited financial statements and report on internal controls be included in the Company'sCompany’s Annual Report for the year ended December
Respectfully submitted,
The Audit Committee
Christopher J. McGowan
,Steven C. Cooper
Richard H. Fleming
Duane C. McDougall
EQUITY COMPENSATION PLAN INFORMATION
Fees Paid to KPMG
The following table presents the aggregate fees billed by KPMG to us for services rendered for the years ended December
31,2016 ($) | 2017 ($) | ||||||
Audit Fees (1) | $ | 2,082,324 | $ | 2,189,996 | |||
Audit-Related Fees (2) | 9,000 | 9,500 | |||||
Tax Fees (3) | 85,000 | 55,400 | |||||
| All Other Fees | — | ||||||
| Total | $ | 2,176,324 | $ | 2,254,896 | |||
2017
($) 2018
($) Audit Fees (1) 2,189,996 2,162,138 Audit-Related Fees (2) 9,500 9,500 Tax Fees (3) 55,400 35,176 All Other Fees Total 2,254,896 2,206,814
| (1) |
| (2) |
| (3) |
Policies and Procedures for Preapproval of Audit and Non-audit Services
The audit committee'scommittee’s charter provides that all audit and non-audit services to be performed for us by KPMG be preapproved. Our controller monitors services provided by KPMG and overall compliance with the preapproval policy and reports periodically to the audit committee on the status of outstanding engagements, including actual services provided and associated fees. Our controller must promptly report any noncompliance with the preapproval policy to the chair of the audit committee.
During 2017,2018, all services by our independent registered public accounting firm were preapproved by the audit committee in accordance with this policy.
Boise Cascade became a public company on February 6, 2013. Our board of directors adopted the 2013 Incentive Compensation Plan (2013 Incentive Plan) on February 4, 2013, in anticipation of the consummation of our initial public offering. From 2013 through April 2016, our compensation committee approved all equity grants made under the 2013 Incentive Plan. Following shareholder approval of ourthe 2016 Boise Cascade Omnibus Incentive Plan (2016 Incentive Plan) all grants are made under that plan, and no awards may be granted under the 2013 Incentive Plan. The following table provides information about our equity compensation plans as of December 31, 2017:
| Plan Category | Number of Securities to Be Issued Upon Exercise of Outstanding Options, Warrants, and Rights | Weighted Average Exercise Price of Outstanding Options, Warrants, and Rights | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in the First Column) | ||||||||
Equity compensation plans approved by shareholders (1) | 1,081,223 | (2) | $ | 27.19 | (3) | 2,732,755 | (4) | ||||
| Equity compensation plans not approved by shareholders | — | — | — | ||||||||
| Total | 1,081,223 | $ | 27.19 | 2,732,755 | |||||||
| Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants, and Rights | Weighted Average Exercise Price of Outstanding Options, Warrants, and Rights | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in the First Column) |
| Equity compensation plans approved by shareholders | 838,805(1) | 27.19(2) | 2,647,138(3) |
| Equity compensation plans not approved by shareholders | — | — | — |
| Total | 838,805 | 27.19 | 2,647,138 |
| (1) |
As of December 31, |
| Applicable only to nonqualified stock options granted in 2013 as the unvested PSUs and RSUs do not have an exercise price. |
| The maximum number of shares to be issued under the 2016 Incentive Plan was 3,700,000 shares, less shares granted under the 2013 Incentive Plan after December 31, 2015 and prior to the effectiveness of the 2016 Plan in April 2016, plus shares |
EXECUTIVE COMPENSATION
The compensation committee of the board of directors of Boise Cascade Company (Company), we have has reviewed and discussed the following Compensation Discussion and Analysis (CD&A) required by Item 402(b) of Regulation S-K with the Company’s management. Based on this review and discussion, the compensation committee recommendshas recommended to the Company’s board of directors that the CD&A be included in this proxy statement and referenced in the Company’s Annual Report for the year ended December 31, 2017.
Respectfully submitted,
The Compensation Committee
Karen E. Gowland,
committeechairDavid H. Hannah
Kristopher J. Matula
Duane C. McDougall
This CD&A describes the 20172018 compensation program for our executive officers, particularly our Named Executive Officersnamed executive officers who are listed below, along with the positions they held with the Company as of December 31, 2017:
| Thomas K. Corrick - Chief Executive Officer | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Wayne M. Rancourt - Executive Vice President, Chief Financial Officer, and Treasurer | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nick Stokes - Executive Vice President,
Our Compensation Objectives and Philosophy We want to attract, retain, and incent the management talent we believe is essential to achieving the Company’s strategic objectives, which are to grow the Company prudently and to increase long-term shareholder value. As a guiding philosophy, we target all forms of compensation at the 50 th percentile of comparable market compensation data, taking into account each person’s position, responsibilities, performance, contributions to the Company’s success, level of experience, and other distinguishing characteristics. In some instances and for the purpose of internal equity, we We also provide at-risk pay opportunities that comprise a significant portion of total compensation opportunity to motivate and reward our executive officers for achieving the Company’s strategic objectives. As a 25 EXECUTIVE COMPENSATION Use of Market Data to Determine Amount and Allocation of Compensation The Management and the Since 2011, the FW Cook conducted recommendations and adopted the 2018 peer group as follows:
During 26 EXECUTIVE COMPENSATION Summary of 2018 For The The compensation committee also made salary adjustments for our executive officers in late 2018 to reflect several promotions, the changing median pay in our peer companies, and individual officer performance. Executive Compensation Elements The five elements of the
Role of Management in Setting Executive and Director Compensation As described below, the Base Salary Our Current base salaries and 2018 base salary increases are listed below:
Short Term Incentive Plan The STIP is designed to recognize and reward the contributions that 27 EXECUTIVE COMPENSATION The For 2018, each of our named executive officers participated in the STIP. The plan provided for awards to be determined based on the extent to which the financial goals and performance objectives were met during the year, subject to the compensation committee’s discretion. The performance metrics established by the compensation committee under our 2018 STIP were based on a forecast of 1.27 million U.S. housing starts, a primary metric in our business. The annual incentive target awards, financial goals, and performance objectives required for each 2018 STIP Compensation
2018 From time to time, the 2018 to the named executive officers. LTIPs (2013 Incentive Plan and 2016 Incentive Plan - collectively the Plans) The Boise Cascade Company board of directors approved the 2013 Incentive Plan before our initial public offering. The 2013 Incentive Plan was replaced by the 2016 Incentive Plan by shareholder vote at our 2016 28 EXECUTIVE COMPENSATION We made equity grants to certain The 2016 Incentive Plan provides for grants of stock options, stock appreciation rights, restricted stock, other stock-based awards, other cash-based compensation, and performance awards. Directors, officers, and other employees, as well as others performing consulting or advisory services are eligible for grants under the 2016 Incentive Plan. The purpose of the 2016 Incentive Plan is to provide incentives that will attract, retain, and motivate high-performing officers, directors, employees, and consultants by providing them a proprietary interest in our long-term success or compensation based on their performance in fulfilling their responsibilities to our Company. Both Plans are administered by our compensation committee. The Plans provide that awards granted under the Plans are subject to any recoupment policy we may have, including the clawback of LTIP Awards In February Beginning in 2016, grants on the day of the award after market close. Half of the value of the target award was granted in The RSUs awarded vest over a three-year period with one-third vesting on March 1 The PSUs awarded as target are adjusted by a performance factor determined by the performance objectives listed below and may be further adjusted at the discretion of the compensation committee. The performance-adjusted PSUs vest in a single installment on March 1, 2021, with share distribution the following day. The 2018 LTIP awards were based on a closing market value on February 22, 2018 of $43.05 and are as follows:
29 EXECUTIVE COMPENSATION The Vesting of LTIP awards is subject to a named executive officer’s continued employment through the vest date(s), except in certain limited circumstances. If a named executive officer dies or becomes disabled, (i) all unvested RSUs become vested and (ii) all earned PSUs for which the performance metric has been satisfied become vested at that amount. In the event the performance year applicable to the PSUs has not elapsed at the time of such death or disability, the PSUs will vest based on actual
time-vesting, become vested. Other Compensation and Benefit Plans The Financial Counseling Program We provide limited perquisites to our executive officers. Under our financial counseling program, up to $5,000 in expenses per calendar year incurred by officers for professional tax preparation, planning and compliance, investment planning, and estate planning will be paid by the Company. Unused amounts up to one year’s allowance ($5,000) may be carried over from year to year. Boise Cascade Pension Plan Effective December 31, 2009, the The BCPP entitles each vested employee to receive an annual pension benefit at normal retirement age as determined by a formula involving the average of the highest five consecutive years of the employee’s compensation out of the last 10 years of employment through December 31, 2009 (Average High Five) times an annual factor for each year of service. Under the BCPP, EXECUTIVE COMPENSATION The Supplemental Pension Plan While the pension plan was in effect, if an employee earned income in excess of the limits provided under the Internal Revenue Code for qualified plans, or if income was deferred under the Because the benefit definition in the SUPP is a derivative of that contained in the BCPP described above, the benefit freeze adopted for the qualified plan at year-end 2009 effected a similar freeze in further benefit accruals under the SUPP as of the same date. All of our The Supplemental Early Retirement Plan Under our unfunded, non-qualified Supplemental Early Retirement Plan (SERP), an officer was eligible for benefits under the plan if the officer: (i) was an officer of OfficeMax immediately prior to the 2004 Forest Products Acquisition; (ii) is 55 years old or older (or 58 years old or older for officers elected on or after June 1, 2004, and before October 29, 2004); (iii) has ten or more years of service; (iv) has served as an officer for at least five full years; and (v) retires before the age of 65 (or in certain cases age 62). Eligible officers retiring prior to age 65 receive an early retirement benefit from the SERP which, in combination with their benefit under the BCPP and the SUPP, equals the benefit calculated under the BCPP and the SUPP without reduction due to the The Present Value of Pension Benefits The aggregate, present value of pension defined benefits as of December 31, ” The Boise Cascade Company Savings Plan The Company maintains a 401(k) defined-contribution savings plan for all of its U.S. salaried employees, including its 31 EXECUTIVE COMPENSATION Since January 2013, the Company has provided a contribution to each salaried plan. Amounts deferred under this plan by ” Nonqualified Deferred Compensation Plan Our 2004 Deferred Compensation Plan is an unfunded, nonqualified, defined contribution plan that was reopened for participation effective January 1, 2014. Under the deferred compensation plan, participating employees irrevocably elect each year to defer receipt of a portion of their base salary and incentive compensation. A ” Salaried Employee Life Insurance Plan and Officers’ Supplemental Life Plan The Company maintains two plans under which Company-paid life insurance is made available to its officers. Under its Salaried Employee Life Insurance Plan for which all of our salaried employees participate, the Company provides, at its expense during each salaried employee’s period of employment, life insurance in an amount equal to the employee’s base salary. Messrs. Corrick, Hutchinson, Rancourt, and Sahlberg participate in this plan. Mr. Stokes participates in our Officers’ Supplemental Life Plan, which is closed to new participants, and under which a Company-paid life insurance benefit during employment is provided in an amount equal to two times the officer’s base salary. Amounts paid by the Company for the coverage provided to each of our named executive officers is reported in the column titled “All Other Compensation” in the “Summary Compensation Table.” Agreements with Named Executive Officers The Company does not have employment agreements with any of its Severance Agreements with Messrs. Corrick, Rancourt, Stokes, Hutchinson, and Sahlberg The Company entered into severance agreements with each of the 32 EXECUTIVE COMPENSATION The severance agreements are effective for three years from the The severance agreements for the named executive officers. In the event of a change in control, the agreements require a second trigger of a qualifying termination from employment before benefits are payable. The severance agreements provide that in the event of a non-qualifying termination, the employee will be entitled to receive his or her full base salary through the date of termination, plus all other compensation to which he or she is then entitled. In the event of a failure to perform duties as a result of incapacity due to physical or mental illness or injury, the employee will be entitled to continue to receive the full base salary until such time as employment is terminated due to disability. No severance payments or continuation of healthcare benefits beyond the date of termination are provided for under such circumstances. In consideration of the severance payments described above, each severance agreement contains confidentiality and non-solicitation provisions, and a general release of all claims against the Company and its affiliates, as a condition of payment of benefits under the severance agreement. Role of Tax Considerations Section 162(m) of the tax code limits the tax deductibility of compensation paid to our chief executive officer and certain other executive officers to $1 million per officer in any taxable year. Effective for taxable years beginning after December 31, 2017, the exception from Section 162(m)’s deduction limit for “performance-based” compensation has been repealed, unless the compensation qualifies for certain transition relief. The Compensation Committee retains the flexibility and discretion to structure compensation programs and authorize compensation that may not be deductible, including as a result of the changes made to Section 162(m) of the tax code, as described above. This flexibility is necessary for elements of the Company’s success, such as attracting and retaining talented executives and rewarding achievement of the Company’s strategic objectives. 33 EXECUTIVE COMPENSATION The following table presents compensation information for Messrs. Corrick, Rancourt, Stokes, Hutchinson, and Sahlberg for 2018, 2017,
34 EXECUTIVE COMPENSATION For more information concerning the pension plans and deferred compensation plans in which our
The following table presents information concerning each grant of a non-equity and equity award made to our
35 EXECUTIVE COMPENSATION The following table presents information concerning the
36 EXECUTIVE COMPENSATION The following table reflects the number of
Pension Benefits Pension benefits for officers are frozen, and no additional benefits are being earned. The following table reflects the present value of accumulated benefits payable to Messrs. Corrick, Rancourt, Stokes, Hutchinson, and Sahlberg, including the number of years of service credited to each of them under our defined benefit pension plans. No amounts were distributed to any of them during “Other Compensation and Benefit
In February 2013, the 2004 37 EXECUTIVE COMPENSATION
For more information concerning our nonqualified deferred compensation plan, see The following tables reflect an estimate of the compensation the Company would have been required to pay to each of its
The amounts shown assume that such termination or change in control was effective as of December 31, The availability of severance payments and continued healthcare and insurance benefits beyond termination of employment is contractually conditioned for each of our 38 Thomas K. Corrick
Wayne M. Rancourt
Nick Stokes
39 EXECUTIVE COMPENSATION
Dan Hutchinson
John T. Sahlberg
Pay Ratio Disclosure As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) of Regulation S-K, we are providing the following information about the relationship of the annual total compensation of our employees and the annual total compensation of Thomas K. Corrick, our chief executive officer: For
40 Based on this information, we estimate that the annual total compensation of Mr. Corrick, our chief executive officer, was approximately We identified our median employee by preparing a list of all our employees (excluding our chief executive officer and our employees in the UK and Canada) as of December 31, We did not include our employees in Canada or the United Kingdom in determining our median employee, as they accounted for less than 5% of our total employee population as of December 31, The pay ratio included above is a reasonable estimate calculated in a manner consistent with SEC rules based on our payroll and the methodology described above. The SEC rules for identifying the median-compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices. As such, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios. Internet Availability of Proxy Materials, Annual Reports, and Other Reports and Policies You may view a complete copy of our proxy statement and 2018 Annual Report by visiting www.proxyvote.com. Please have your 12 digit control number available. Your 12 digit control number can be found on your Notice of Internet Availability of Proxy Materials. If you received a paper copy of your proxy materials, your 12 digit control number can be found on your proxy card or voting instruction card. You may view complete copies of all of our SEC filings, including Annual Reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and certain financial information, by visiting our website at www.bc.com and selecting Investors and then SEC Filings. Record Date and Voting at Our 2019 Annual Shareholders’ Meeting Shareholders owning our common stock at the close of business on March 6, 2019 (the Record Date), may vote at the annual meeting. On the Record Date, 38,974,335 shares of our common stock were outstanding. Each share is entitled to one vote on each matter to be voted upon at the annual meeting. All valid proxies properly executed and received by us prior to our annual meeting will be voted as you direct. If you do not specify how you want your shares voted, they will be voted:
Your shares will also be voted on any other matters presented for a vote at the annual meeting in accordance with the judgment of the persons acting under the proxies. You may revoke your proxy and change your vote at any time before the annual meeting by submitting a written notice to our corporate secretary, by mailing a later-dated and properly executed proxy, or by voting in person at the annual meeting. 41 INFORMATION ABOUT OUR ANNUAL SHAREHOLDER MEETING AND VOTING Quorum A quorum is necessary to hold a valid meeting. A quorum will exist if shareholders holding a majority of the shares of our common stock outstanding and entitled to vote at the annual meeting are present in person or by proxy. Shareholders have no right to cumulative voting as to any matter, including the election of directors. Abstentions and broker nonvotes will be treated as shares of common stock that are present and entitled to vote for purposes of determining the presence of a quorum. A broker nonvote occurs when a broker does not have discretionary voting power for that particular item and has not received voting instructions from the beneficial owner or when it has discretionary power but declines to use it. Brokers do not have discretionary voting power on nonroutine matters. Proposal No. 3, the ratification of the appointment of our independent registered public accounting firm for the year ending December 31, 2019, is the only routine matter for consideration at the annual meeting. Independent Tabulator We have appointed Broadridge Financial Solutions Inc. (Broadridge) as our independent tabulator to receive and tabulate all votes cast at the annual meeting. Broadridge will determine whether a quorum is present. Independent Inspector of Election We have appointed Cydni J. Waldner, of Hawley Troxell Ennis & Hawley LLP, as our independent inspector of election to certify the vote results. Proxy Solicitation Our board of directors is soliciting your proxy. Our employees and directors may solicit proxies by mail, telephone, email, or in person. Our employees and directors will not receive additional compensation for these activities and the entire cost of this solicitation will be borne by us. In addition, Morrow Sodali LLC, 470 West Avenue, Stamford, Connecticut 06902 (“Morrow Sodali”), will assist us in the solicitation of proxies. We will pay $7,500 in fees, plus expenses and disbursements, to Morrow Sodali for its proxy solicitation services. Householding of Annual Meeting Materials Some banks, brokers, and other record holders may be participating in the practice of “householding” proxy materials. This means that only one copy of our proxy materials or Notice of Internet Availability of Proxy Materials may have been sent to multiple shareholders in your household. We will promptly deliver a separate copy of such documents to you if you contact the Broadridge Householding Department at the following address: Broadridge Householding Department 51 Mercedes Way Edgewood, NY 11717 Toll-Free Number: 1-800-542-1061 If you want to receive multiple copies of our proxy materials or Notice of Internet Availability of Materials in the future, or if you are receiving multiple copies and would like to receive only one copy for your household, you should contact your bank, broker, or other record holder, or you may contact the Broadridge Householding Department at the address and phone number shown. 42 INFORMATION ABOUT OUR ANNUAL SHAREHOLDER MEETING AND VOTING Shareholder Proposals for Inclusion in Next Year’s Proxy Statement According to SEC rules, to be considered for inclusion in next year’s proxy statement, our corporate secretary must receive shareholder proposals at the address shown below no later than November 23, 2019: Boise Cascade Company Attention: Corporate Secretary 1111 West Jefferson Street, Suite 300 Boise, ID 83702 Additionally, our bylaws require that our corporate secretary must receive notice of any nominations for director or other business a shareholder proposes to bring before our next annual meeting no earlier than January 3, 2020, and no later than February 2, 2020. Please refer to Article II, Section 11 of our bylaws for an outline of the information a shareholders’ notice must include regarding director nominees and other business to be brought before a shareholders’ meeting. You may view a complete copy of our bylaws by visiting our website at www.bc.com and selecting Investors, Leadership and Governance and then Bylaws. If You Plan to Attend If you plan to attend the annual meeting in person, please bring photo identification, as well as your Notice of Annual Shareholder Meeting; your brokerage statement reflecting your Boise Cascade common stock; a copy of the voting instruction card provided by your bank, broker, trustee, or nominee; or similar evidence of share ownership as of the Record Date. 43
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