Edgar Filing: UNIVERSAL FOREST PRODUCTS INC

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

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[X] Definitive Proxy Statement.
[ ] Definitive Additional Materials.
[ ] Soliciting Material Pursuant to Section 240.14a-12

Universal Forest Products
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(Name of Registrant as Specified In Its Charter)

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SEC 1913 (02-02)

UNIVERSAL FOREST PRODUCTS, INC.
2801 East Beltline NE
Grand Rapids, MI 49525

NOTICE OF ANNUAL MEETING

The Annual Meeting of Shareholders of Universal Forest Products, Inc. will
be held in the Imperial Ballroom at the Amway Grand Plaza Hotel, 187 Monroe NW,
Grand Rapids, Michigan, on Wednesday, April 16, 2003, at 8:30 a.m. local time
(registration begins at 8:00 a.m.) for the following purposes:

(1) Election of one director for a one year term expiring in 2004, election
of one director for a two year term expiring in 2005, and election of
three directors for three year terms expiring in 2006.

(2) The transaction of such other business as may properly come before the
meeting.

Shareholders of record at the close of business on March 1, 2003, are
entitled to notice of and to vote at the meeting.

To vote by telephone, shareholders of record (shareholders who possess a
certificate representing their shares) may call toll free on a touch-tone
telephone 1-800-PROXIES (1-800-776-9437), enter the control number located on
the proxy card and follow the recorded instructions. To vote on the Internet, go
to the site http://www.voteproxy.com, enter the control number located on the
proxy card and follow the instructions provided.

If your shares are held through a bank or broker (referred to as "street
name"), you may also be eligible to vote your shares electronically. Follow the
instructions on your voting form, using either the toll free telephone number or
the Internet address that is listed.

A copy of the Annual Report to Shareholders for the year ended December 28,
2002, is being mailed to you concurrently with this Notice.

BY ORDER OF THE BOARD OF DIRECTORS

Matthew J. Missad, Secretary

March 17, 2003

Universal Forest Products, Inc.
2801 East Beltline NE
Grand Rapids, Michigan 49525

YOUR VOTE IS IMPORTANT. EVEN IF YOU PLAN TO ATTEND THE MEETING,
PLEASE SIGN, DATE AND RETURN THE ENCLOSED PROXY PROMPTLY.

UNIVERSAL FOREST PRODUCTS, INC.
2801 East Beltline NE
Grand Rapids, Michigan 49525

ANNUAL MEETING OF SHAREHOLDERS
April 16, 2003

PROXY STATEMENT
SOLICITATION OF PROXIES

This Proxy Statement and the enclosed Proxy are being furnished to holders
of Common Stock, no par value, of Universal Forest Products, Inc. (the
"Company"). The Board of Directors is soliciting proxies for use at the Annual
Meeting of Shareholders to be held on April 16, 2003, and at any adjournment of
that meeting. The Annual Meeting will be held in the Imperial Ballroom of the
Amway Grand Plaza Hotel, 187 Monroe NW, Grand Rapids, Michigan, at 8:30 a.m.
local time. Registration for the meeting begins at 8:00 a.m.

If the enclosed Proxy is properly signed and returned to the Company, the
shares represented by the Proxy will be voted at the Annual Meeting and at any
adjournment of the meeting. If a shareholder specifies a choice, the Proxy will
be voted as specified. If no choice is specified, the shares represented by the
Proxy will be voted for the election of all nominees named in the Proxy
Statement, and in accordance with the judgment of the persons named as proxies
with respect to any other matter which may come before the meeting.

Returning your completed Proxy will not prevent you from voting in person at
the Annual Meeting if you wish to do so. In addition, you may revoke your Proxy
at any time before it is voted, by written notice to the secretary of the
Company prior to the Annual Meeting, or by submission of a later-dated Proxy, or
by the withdrawal of your Proxy and voting in person at the Annual Meeting.

The cost of the solicitation of proxies will be paid by the Company. In
addition to the use of the mail, proxies may be solicited personally, by
telephone, by facsimile, or by electronic mail by regular employees of the
Company who will not receive additional compensation for soliciting proxies. The
Company does not intend to pay any compensation for the solicitation of proxies,
except that brokers, nominees, custodians, and other fiduciaries will be
reimbursed by the Company for their expenses in connection with sending proxy
materials to beneficial owners and obtaining their proxies.

VOTING SECURITIES

Holders of record of Common Stock at the close of business on March 1, 2003,
will be entitled to vote at the Annual Meeting. As of March 1, 2003, there were
17,751,643 shares of Common Stock outstanding. The presence in person or by
Proxy of at least 51% of such shares constitutes a quorum. A shareholder is
entitled to one vote for each share of Common Stock registered in the
shareholder's name at the close of business on March 1, 2003. Under Michigan
law, abstentions are treated as present and entitled to vote and therefore have
the effect of a vote against the matter. A broker non-vote on a matter is
considered not entitled to vote on that matter and, therefore, is not counted in
determining whether a matter requiring approval of a majority of the shares
present and entitled to vote has been approved. Votes cast at the meeting or
submitted by Proxy will be counted by inspectors of the meeting who will be
appointed by the Company. There is no right to cumulative voting on any matter.

ELECTION OF DIRECTORS

The Company's Articles of Incorporation provide that the Board of Directors,
which consists of seven members unless otherwise specified by two-thirds of the
Board, shall be divided into three classes, as equal in number as possible, with
the classes to hold office for staggered terms of three years each. At the
recommendation of the Nominating and Corporate Governance Committee, the Board
of Directors has increased the size of the Board to eight members. The Board of
Directors appointed Dan M. Dutton and John M. Engler to the Board on January 15,
2003, and appointed Gary F. Goode to the Board on March 14, 2003. The Board
nominated John M. Engler to a one year term expiring at the 2004 Annual Meeting,
nominated Gary F. Goode to a two year term expiring at the 2005 Annual Meeting,
and nominated Dan M. Dutton to a three year term expiring at the 2006 Annual
Meeting. In addition, the Board nominated incumbent directors John W. Garside
and Peter F. Secchia for re-election as directors for three year terms expiring
at the 2006 Annual Meeting.

The persons named as proxy holders in the accompanying Proxy will vote for
the above-named nominees, unless the shareholder directs them differently on the
proxy card. If a nominee is not available for election as a director at the time
of the Annual Meeting (a situation which is not now anticipated), the Board of
Directors may designate a substitute nominee, and the accompanying Proxy will be
voted for the substituted nominee.

A vote of the shareholders holding a plurality of the shares present in
person or represented by proxy is required to elect directors. Accordingly, the
five individuals who receive the greatest number of votes cast at the meeting
will be elected as directors.

The Board of Directors recommends a vote FOR the election of each person
nominated by the Board.

The following table provides certain biographical information for each
person who is nominated for election as a director at the Annual Meeting and for
each person who is continuing as an incumbent director.

NAMES, (AGES), POSITIONS, AND BACKGROUNDS OF DIRECTORS AND NOMINEES SERVICE AS A DIRECTOR
--------------------------------------------------------------------------------------------------

NOMINEE FOR TERM EXPIRING IN 2004
JOHN M. ENGLER (53) is the President of State and Local Government Director since 2003.
Business and Vice President of Government Solutions for North Member of Nominating and
America for EDS in Herndon, Virginia. Mr. Engler served as Governor Corporate Governance
for the State of Michigan from 1990 to 2002. Mr. Engler also serves Committee.
on the boards of Munder Capital Management and Northwest Airlines. Member of Personnel and
Compensation Committee.
NOMINEE FOR TERM EXPIRING IN 2005
GARY F. GOODE (58) retired from Arthur Andersen LLP in March 2001. Director since 2003.
He joined Arthur Andersen in 1972, and was a partner for 19 years. Proposed member of Audit
Mr. Goode currently works as an independent consultant, and serves Committee.
as a director of Gentex Corporation.

NAMES, (AGES), POSITIONS, AND BACKGROUNDS OF DIRECTORS AND NOMINEES SERVICE AS A DIRECTOR
--------------------------------------------------------------------------------------------------

NOMINEES FOR TERMS EXPIRING IN 2006
DAN M. DUTTON (55) is Chairman and Chief Executive Officer of Director since 2003.
Stimson Lumber Company of Portland, Oregon with whom he has been Chairman of Audit
affiliated since 1988. Mr. Dutton also serves on the board of the Committee.
American Forest and Paper Association.

JOHN W. GARSIDE (63) is the President and Treasurer of Woodruff Director since 1993.
Coal Company of Kalamazoo, Michigan. Mr. Garside serves as a Chairman of Personnel and
commissioner for the Michigan Department of Transportation, and is Compensation Committee.
also a director and member of the compensation committee of PRAB, Member of Nominating and
Inc. Corporate Governance
Committee.

AMBASSADOR PETER F. SECCHIA (65) retired from the Company on Director since 1967.
December 31, 2002. He had been with the Company since 1962, and had
been president, chief executive officer, and chairman of the board
from March 1971 until 1989. From 1989 until 1993, he served as U.S.
Ambassador to Italy. From January 1993 to the present time, he has
served as Chairman of the Board of the Company.
INCUMBENT DIRECTORS -- TERMS EXPIRING IN 2004
WILLIAM G. CURRIE (55) is the Vice Chairman of the Board and Chief Director since 1978.
Executive Officer of the Company. He joined the Company in 1971,
serving as a salesman, general manager, vice president, and
executive vice president. Since 1989, he has been the Chief
Executive Officer of the Company, and on January 1, 2000, also
became Vice Chairman of the Board.

PHILIP M. NOVELL (65) is a consultant with the Compass Group of Director since 1993.
Birmingham, Michigan. Mr. Novell retired as General Sales Manager Chairman of Nominating and
for the Ford Division of Ford Motor Company on December 31, 1998, Corporate Governance
with whom he had been affiliated since 1961. Committee.
Member of Audit Committee.
INCUMBENT DIRECTOR -- TERM EXPIRING IN 2005
LOUIS A. SMITH (63) is President of the law firm of Smith and Director since 1993.
Johnson, Attorneys, P.C., of Traverse City, Michigan. Mr. Smith Member of Audit Committee.
also serves on the Advisory Board of the Huntington National Bank Member of Personnel and
of Traverse City, and serves as a member of the Advisory Council to Compensation Committee.
the University of Notre Dame Law School.

The Board of Directors has appointed an Audit Committee. This committee,
composed entirely of independent directors as currently defined under the
applicable Nasdaq Listing Standards, is responsible for overseeing management's
reporting practices and internal controls on behalf of the Board of Directors.
This committee is also responsible for recommending to the Board of Directors
the independent public accountants to audit the Company's financial statements.
The full responsibilities of the Audit Committee are set forth in the Audit
Committee Charter, a copy of which is attached as Appendix A to this Proxy
Statement. During 2002, the Audit Committee held three formal meetings, and four
special meetings via telephone conference call.

The Board of Directors has renamed its Nominating Committee as the
Nominating and Corporate Governance Committee. This committee is responsible for
recommending to the Board suitable candidates for nomination for positions on
the Board of Directors and committees of the Board of Directors. This committee
consists entirely of independent directors, as currently defined under the
applicable Nasdaq Listing Standards. This committee is also charged with
reviewing corporate governance to comply with rules promulgated by the
Securities and Exchange Commission and the listing standards of Nasdaq. During
2002, the Nominating Committee held one meeting. The Nominating and Corporate
Governance Committee will consider nominees recommended by shareholders,
3

provided that a recommendation is submitted in writing to the Chairman of the
Nominating and Corporate Governance Committee at the address of the Company, on
or before the 30th day preceding the date of the Annual Meeting, and includes a
description of the proposed nominee, his or her consent to serve as a director,
and other information regarding the proposed nominee as would be required to be
included in a proxy statement filed under the Securities Exchange Act.

The Board of Directors has a Personnel and Compensation Committee,
consisting entirely of independent directors, as currently defined by the Nasdaq
Listing Standards, that is responsible for reviewing and recommending to the
Board of Directors the timing and amount of compensation for key employees,
including salaries, bonuses, and other benefits. The Personnel and Compensation
Committee is also responsible for administering the Company's stock option and
other equity-based incentive plans, recommending retainer and attendance fees
for non-employee directors, and reviewing compensation plans and awards as they
relate to key employees. During 2002, the Personnel and Compensation Committee
held two formal meetings, and three meetings via telephone conference call.

During the Company's last fiscal year, there were four regular meetings of
the Board of Directors and one special meeting, and the Board took action by
unanimous written consent on thirteen occasions. Each of the incumbent directors
attended 100% of the aggregate number of meetings of the Board of Directors and
meetings of committees which they were eligible to attend.

COMPENSATION OF DIRECTORS

Directors who are also employees of the Company receive no annual retainer
and are not compensated for attendance at Board or committee meetings. In
addition, Chairman Secchia does not receive any additional compensation for
serving on the Board. Directors who are not employees of the Company receive a
$10,000.00 annual retainer fee, plus $500.00 for attendance at each regular and
special meeting of the Board of Directors. Each outside Director is granted 100
shares of stock for each Board meeting attended, up to a maximum of 400 shares
per year. Also, each outside Director receives a $500.00 meeting fee for each
committee meeting they attend.

Each Director who is not an employee of the Company may participate in the
Director Retainer Stock Plan. The Director Retainer Stock Plan, approved by
shareholders in April 1994, provides that each Director may elect to receive
Company stock, on a deferred basis, in lieu of cash compensation for the
Director's retainer and meeting fees.

Directors receive reimbursement of ordinary and necessary expenses to attend
meetings. The Chairmen of the Personnel and Compensation, and Nominating and
Corporate Governance Committees do not receive additional compensation for
serving as a Chairman. The Chairman of the Audit Committee receives $2,500.00
per year for serving as Chairman.

OWNERSHIP OF COMMON STOCK

The following table sets forth information as to each shareholder known to
the Company to have been the beneficial owner of more than five percent (5%) of
the Company's outstanding shares of Common Stock as of March 1, 2003:

NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT
BENEFICIAL OWNER BENEFICIAL OWNERSHIP(1) OF CLASS(2)
------------------------------------------------------------------------------------------------------

Barclays Private Bank and Trust Limited 996,464 5.5%
10 rue d'Italie
CH-1204 Geneva, Switzerland

-------------------------
(1) Except as otherwise indicated by footnote, each named person has sole voting
and investment power with respect to the shares indicated.

(2) Shares outstanding for this calculation include 141,056 shares which are
subject to options exercisable in 60 days, 21,822 shares which are subject
to issuance under the Director Retainer Stock Plan, and 129,853 shares which
are subject to issuance under a Deferred Compensation Plan.

SECURITIES OWNERSHIP OF MANAGEMENT

The following table contains information with respect to ownership of the
Company's Common Stock by all directors, nominees for election as director,
executive officers named in the tables under the caption "Executive
Compensation," and all executive officers and directors as a group. The
information in this table was furnished by the Company's officers, directors,
and nominees for election of directors, and represents the Company's
understanding of circumstances in existence as of March 1, 2003.

NAME OF AMOUNT AND NATURE OF PERCENT
BENEFICIAL OWNER BENEFICIAL OWNERSHIP(1) OF CLASS(2)
--------------------------------------------------------------------------------------------------------

Peter F. Secchia 892,759(3) 4.9%
William G. Currie 581,987(4) 3.2%
Michael B. Glenn 226,813(5) 1.2%
Robert K. Hill 127,222(6) *
C. Scott Greene 40,016(7) *
Dan M. Dutton 0 *
John M. Engler 0 *
John W. Garside 29,804(8) *
Philip M. Novell 13,057(8) *
Louis A. Smith 24,911(8) *
All directors and executive officers as a group (15
persons) 2,192,810(8) 12.2%

-------------------------
* Less than one percent (1%).

(1) Except as otherwise indicated by footnote, each named person has sole voting
and investment power with respect to the shares indicated.

(3) Includes 50,000 shares owned by Mr. Secchia's wife; 404,624 shares held by
limited liability companies of which Mr. Secchia is a member; 105,000 shares
held by a family limited partnership of which Mr. Secchia is a partner; and
61,300 shares held by a family foundation.

(4) Includes 1,087 shares subject to issuance under a Deferred Compensation
Plan.

(5) Includes 6,000 shares which may be acquired by Mr. Glenn pursuant to options
exercisable in 60 days. Also includes 213 shares which are subject to
issuance under a Deferred Compensation Plan.

(6) Includes 4,000 shares which may be acquired by Mr. Hill pursuant to options
exercisable in 60 days. Also includes 25,562 shares which are subject to
issuance under a Deferred Compensation Plan.

(7) Includes 10,000 shares which may be acquired by Mr. Greene pursuant to
options exercisable in 60 days. Also includes 9,927 shares which are subject
to issuance under a Deferred Compensation Plan.

(8) Includes shares obtained through the Company's Director Retainer Stock Plan
for Mr. Garside, Mr. Novell, and Mr. Smith who hold 1,254 shares, 9,957
shares, and 10,611 shares, respectively, through such plan.

EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

The following Summary Compensation Table shows certain information
concerning the compensation for the Chief Executive Officer and the Company's
four most highly compensated executive officers for fiscal 2002 (the "Named
Executives"), and their compensation for 2001 and 2000:

LONG-TERM
ANNUAL COMPENSATION COMPENSATION
--------------------------------------- -------------
OTHER SECURITIES
ANNUAL UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY(1) BONUS(1)(2) COMPENSATION OPTIONS/SAR'S COMPENSATION(3)
-------------------------------------------------------------------------------------------------------------

William G. Currie 2002 $459,934 $805,000 0 95,000 $8,030
Vice Chairman of the 2001 439,250 777,000 0 5,000 7,684
Board and Chief Executive 2000 418,333 740,000 0 0 7,258
Officer

Peter F. Secchia(4) 2002 300,000 240,000 0 0 7,398
Chairman of the Board 2001 300,000 240,000 0 0 7,684
2000 300,000 240,000 0 0 7,258

Michael B. Glenn 2002 330,271 645,000 0 55,000 8,030
President and Chief 2001 313,750 625,000 0 5,000 7,684
Operating Officer 2000 295,563 510,000 0 18,000 7,258

Robert K. Hill 2002 262,517 550,000 0 5,000 8,030
President 2001 248,496 524,000 0 5,000 7,684
Universal Forest Products 2000 230,330 500,000 0 12,000 7,258
Western Division

C. Scott Greene 2002 219,851 341,111 0 3,711 8,030
President 2001 197,920 320,000 0 2,133 7,684
Universal Forest Products 2000 163,333 50,000 0 12,000 6,873
Eastern Division

-------------------------
(1) Includes amounts deferred by Named Executives under the Company's 401(k)
Plan and the Deferred Compensation Plan.

(2) Includes annual bonus payments under performance-based bonus plans tied to
the Company's operating profit and return on investment, which covers
substantially all salaried employees. The bonus amounts include the amounts
earned in each respective year, which are paid in the subsequent year.

(3) The amounts set forth in this column represent Company contributions to the
Company's Profit Sharing and 401(k) Plan. Subject to certain requirements,
including age and service requirements, all employees of the Company and its
subsidiaries are eligible to participate in the Plan.

(4) Mr. Secchia's employment with the Company terminated on December 31, 2002.

OPTION GRANTS IN LAST FISCAL YEAR

The following table sets forth information regarding stock options granted
to the Named Executives during the preceding fiscal year:

INDIVIDUAL GRANTS
-----------------------------------------------------------------------
NUMBER OF SECURITIES PERCENT OF OPTIONS
UNDERLYING OPTIONS GRANTED TO ALL EXERCISE GRANT DATE
GRANTED EMPLOYEES IN PRICE EXPIRATION PRESENT VALUE
EXECUTIVE (#)(1) FISCAL YEAR ($/SH) DATE (4)
-------------------------------------------------------------------------------------------------------------------

William G. Currie 5,000 0.87% $21.84(2) 01/31/2012 $ 26,081
30,000 5.20% $24.46(3) 04/17/2012 $175,258
30,000 5.20% $24.46(3) 04/17/2012 $257,970
30,000 5.20% $24.46(3) 04/17/2012 $319,490
Peter F. Secchia 0 0.0%
Michael B. Glenn 5,000 0.87% $21.84(2) 01/31/2012 $ 26,081
12,500 2.17% $24.46(3) 04/17/2012 $ 73,024
12,500 2.17% $24.46(3) 04/17/2012 $107,487
12,500 2.17% $24.46(3) 04/17/2012 $133,121
12,500 2.17% $24.46(3) 04/17/2015 $153,276
Robert K. Hill 5,000 0.87% $21.84(2) 01/31/2012 $ 26,081
C. Scott Greene 3,711 0.64% $21.84(2) 01/31/2012 $ 19,357

-------------------------
(1) The options granted under this plan may be exercised beginning in 2005.

(2) The exercise price equals or exceeds the fair market value of the Company
stock as of the grant date of January 31, 2002.

(3) The exercise price equals or exceeds the fair market value of the Company
stock as of the grant date of April 17, 2002.

(4) Based on the Black-Scholes option valuation model assuming volatility is
27.52%, risk-free rate of return is 4.6%, dividend yield is 0.40%, and time
of exercise is 30 days prior to expiration of option. The Black-Scholes
option valuation model is an alternative suggested by the Securities and
Exchange Commission, and the Company neither endorses this particular model,
nor necessarily agrees with this method for valuing options. The actual
value of the options, if any, will depend on the market value of the
Company's Common Stock subsequent to the date the options become
exercisable.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES

The following table sets forth information regarding the exercise of options
in the last fiscal year by the Named Executives:

NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING IN-THE-MONEY OPTIONS
SHARES UNEXERCISED OPTIONS AT AT DECEMBER 28,
ACQUIRED ON VALUE DECEMBER 28, 2002(#) 2002($)(2)
EXECUTIVE EXERCISE(#) REALIZED($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
------------------------------------------------------------------------------------------------------------------------

William G. Currie 0 0 0 100,000 0 34,925
Peter F. Secchia 0 0 0 0 0 0
Michael B. Glenn 15,000 307,650 0 98,000 0 497,105
Robert K. Hill 15,000 300,000 0 42,000 0 445,445
C. Scott Greene 0 0 0 43,844 0 131,378

-------------------------
(1) Represents the aggregate market value of shares at the time of exercise less
the aggregate exercise price paid by the Named Executives.

(2) Values based on the difference between the closing market price of the
Company's stock as of December 28, 2002 ($21.11) and the exercise price of
the options.

AUDIT COMMITTEE REPORT

The Audit Committee (the "Committee") is composed entirely of independent
directors under current Nasdaq Listing Standards. The Committee is responsible
for overseeing management's reporting practices and internal controls on behalf
of the Board of Directors. The full responsibilities of the Committee are set
forth in its Audit Committee Charter, which was approved by the Board of
Directors on March 11, 2003, and is attached to this Proxy Statement as Appendix
A.

On March 11, 2003, the Committee submitted to the Board of Directors the
following report:

The Committee has reviewed and discussed with management the Company's
audited financial statements as of and for the year ended December 28, 2002.

The Committee has discussed with the independent auditors the matters
required to be discussed by Statement on Auditing Standards No. 61,
Communication with Audit Committees, as amended, by the Auditing Standards Board
of the American Institute of Certified Public Accountants.

The Committee has received and reviewed the written disclosures from the
independent auditors required by Independence Standard No. 1, Independence
Discussions with Audit Committees, as amended, by the Independence Standards
Board, and has discussed with the auditors the auditors' independence.

Based on the reviews and discussions referred to above, the Committee
recommends to the Board of Directors that the financial statements referred to
above be included in the Company's Annual Report on Form 10-K for the year ended
December 28, 2002.

Dan M. Dutton, Audit Committee
Chairman
Philip M. Novell, Audit Committee
Member
Louis A. Smith, Audit Committee Member

PERSONNEL AND COMPENSATION COMMITTEE REPORT

The Personnel and Compensation Committee (the "Committee") of the Board of
Directors has furnished the following report on executive compensation:

During 2002, the Company maintained its compensation program in accordance
with the following Committee goals:

A. Reasonable and appropriate base salaries, based upon job duties.

B. Incentive compensation tied to return on investment ("ROI") with
appropriate adjustments for achievement of specified Company goals.

C. Stock options for executives which align interests of the employee with
interests of shareholders.

The Committee has determined that the following categories will best
motivate Company executives to achieve the Company goals:

BASE SALARIES. Annual base salaries are based on past and present corporate
and individual performance, with reference to base salary data of similar-sized
corporations and industry competitors so such salaries are generally competitive
in the market place. Salary comparisons with peer group companies are reviewed
and analyzed to account for differences in size and business complexity among
peer companies.

The Committee has complete discretion in determining base salary amounts
(including the grant and amount of any annual discretionary incentive payments
or stock option awards), regardless of whether corporate or individual
performance goals are achieved. The Committee exercised its complete discretion
in setting base salaries for 2002.

Each year the Committee reviews, with the Chief Executive Officer, and
approves, with such modifications as it may deem appropriate, an annual salary
adjustment target for executives for the ensuing February 1 to January 31,

based on current available survey data, cost of living factors, and performance
judgments as to the past and expected future contributions of the individual
officers.

INCENTIVE COMPENSATION. The Company relies heavily on annual discretionary
incentive compensation to attract and retain Company officers and other key
employees of outstanding abilities, and to motivate them to perform to the full
extent of their abilities. The Company's incentive compensation system in 2002
focused on ROI. For Messrs. Greene and Hill, 2002 bonuses are based on the ROI
of their respective operations, with adjustments to the bonus based on
attainment of certain Company and Divisional goals. For Messrs. Currie and
Glenn, incentive compensation is based entirely on the ROI of the Company as a
whole.

CHIEF EXECUTIVE. The Committee annually reviews and establishes the
discretionary component of the base salary of the Chief Executive Officer. His
salary is based on comparable compensation data, the Committee's assessment of
his past performance, and its expectation as to his future contributions in
leading the Company and its businesses. The Chief Executive Officer's base
salary fell within the middle-range of the salaries of comparable executives.
When compared with the peer group of the Company (as discussed under "Stock
Performance Graph"), the Chief Executive Officer's base salary fell in the upper
quartile of the peer group. The Committee has complete discretion in setting
base salary for Mr. Currie (who does not have an employment agreement with the
Company).

The Chief Executive Officer's incentive bonus amount for 2002 was based upon
performance determined under the Company's Performance Bonus Plan. The Chief
Executive Officer's bonus for 2002 reflects the Company's overall performance,
including record net sales and net earnings achieved in 2002 as compared to
2001.

INCENTIVE BONUS PROGRAM. For fiscal 2003, the Company will continue to use
the ROI based Performance Bonus Plan described above. In 2003, the Company is
adding achievement of certain key performance indicators ("KPI") as a factor in
determining the amount of ROI bonus actually paid to participants. Participants
who achieve all of the KPI goals will receive a higher percentage of the ROI
bonus than those achieving fewer KPI goals. By basing the individual's incentive
compensation on the ROI generated by the profit center, the individual is
rewarded for properly managing assets, increasing cash flow, and obtaining
higher net margins. A discretionary bonus component is available for salaried
personnel at operations which have not yet hit the ROI target, but which
demonstrate improvement over the previous year.

For the Chief Executive Officer and the other Named Executives, incentive
compensation will be paid as provided in the Performance Bonus Plan, as approved
by the Committee. For 2003, bonus compensation as determined under the
Performance Bonus Plan may be adjusted depending on the Named Executive's
achievement of certain KPI targets.

Due to the changes in accounting for stock options, the Committee decided
not to grant broad-based stock options to its salaried employees for 2003.

The Company's policy is to pay all earned compensation regardless of whether
it exceeds the One Million Dollar ($1,000,000.00) limitation on compensation
deductions set forth in Section 162(m) of the Internal Revenue Code. To ensure
the maximum tax deductibility for the Company, the Company received shareholder
approval of its Performance Bonus Plan at its 1999 Annual Meeting of
Shareholders.

The Committee recognizes that as the strategic objectives of the Company are
modified and refined, the compensation formulas must also be refined to maintain
the direct correlation between individual compensation and Company performance.

This report has been furnished by the members of the Board of Directors'
Personnel and Compensation Committee.

John W. Garside, Chairman
John M. Engler
Louis A. Smith

The reports of the Audit Committee and the Personnel and Compensation
Committee shall not be deemed incorporated by reference in any general statement
incorporating by reference this Proxy Statement into any filing under the
Securities Act of 1933 or under the Securities Exchange Act of 1934, except to
the extent that the Company specifically incorporates this information by
reference, and shall not otherwise be deemed filed under such Acts.
10

STOCK PERFORMANCE GRAPHS

The following graph depicts the cumulative total return on the Company's
Common Stock compared to the cumulative total return on the indices for The
Nasdaq Stock Market (all U.S. companies) and an industry peer group selected by
the Company. The graph assumes an investment of $100.00 on December 26, 1997 and
reinvestment of dividends in all cases.

COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURNS
PERFORMANCE GRAPH FOR UNIVERSAL FOREST PRODUCTS, INC.
PRODUCED ON 02/19/2003 INCLUDING DATA TO 12/27/2002

[PERFORMANCE GRAPH]

12/1997 12/1998 12/1999 12/2000 12/2001 12/2002

# Universal Forest Products, Inc. 100.0 154.4 101.8 103.4 162.7 166.2
* Nasdaq Stock Market (US Companies) 100.0 144.5 265.0 163.6 132.3 90.6
- Self-Determined Peer Group 100.0 93.5 113.9 69.2 63.9 40.4

-------------------------
NOTES:
A. The lines represent monthly index levels derived from compounded daily
returns that include all dividends.
B. The indexes are reweighted daily, using the market capitalization on the
previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not a trading
day, the preceding trading day is used.
D. The index level for all series was set to $100.00 on 12/26/1997.

The companies included in the Company's self-determined industry peer group
are as follows:

Armstrong World Industries, Inc. Louisiana Pacific Corp.
Building Materials Holding Co. Patrick Industries
Georgia Pacific Corp.

The returns of each company included in the self-determined peer group are
weighted according to each respective company's stock market capitalization at
the beginning of each period presented in the graph above.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires directors, executive officers,
and greater than 10% beneficial owners to file reports of ownership and changes
in ownership of shares of Common Stock with the Securities and Exchange

Commission, and applicable regulations require them to furnish the Company with
copies of all Section 16(a) reports they file. Based solely upon review of the
copies of such reports furnished to the Company, or written representations that
no such reports were required, all Section 16(a) filing requirements applicable
to the reporting persons were complied with, except for Mr. Currie, who filed
one late report covering one transaction, and for Mr. James who filed late his
initial report on Form 3.

RELATED PARTY TRANSACTIONS

Peter F. Secchia has served the Company for many years as its senior
executive officer, and presently serves as Chairman of the Board of Directors.
Mr. Secchia's leadership has been an important force in the success, growth, and
prosperity of the Company. Mr. Secchia retired as an officer of the Company on
December 31, 2002. The Company desired to continue to utilize the experience,
ability, and skills of Mr. Secchia as an advisor and consultant following his
retirement.

Mr. Secchia has agreed to provide certain services upon the terms and
conditions agreed upon between the Board of Directors and Mr. Secchia, as set
forth in a consulting and advisory services agreement with SIBSCO, LLC, a
company of which Mr. Secchia is managing principal. These services include
business and management consulting, public relations counsel, governmental
affairs coordination, and special project services. The agreement is for a term
of five years and provides for monthly payments of $16,667.00. Under this
agreement, the Company has agreed to reimburse SIBSCO, LLC for certain business
expenses including, but not limited to, office rent, utilities, phone, travel
and lodging, business meals, computers and maintenance, clerical assistance, and
all other costs of performing the advisory services for the Company. The
Company's reimbursement may not exceed $16,667.00 per month. At the discretion
of the Board of Directors, Mr. Secchia is eligible for incentives if his
advisory services significantly improve the Company's operating results. The
incentive may not exceed $100,000.00 per year.

In addition to the consulting agreement, the Company entered into a seven
year non-compete agreement with Mr. Secchia, which provides for monthly payments
of $12,500.00.

On April 17, 2002, the Board of Directors entered into a Conditional Share
Grant Agreement with William G. Currie, the Company's Chief Executive Officer.
The Agreement obligates the Company to issue to Mr. Currie 10,000 shares of its
common stock upon his 65th birthday, providing he is then an employee of the
Company. The Agreement provides for an acceleration of the grant date upon a
change in control of the Company or upon Mr. Currie's earlier death.

In 2002, the Company engaged OptiSave, a telecommunications consulting firm,
which is owned by inlaws of the Company's Chief Financial Officer. The Company
paid $170,000.00 in 2002 for the services of OptiSave, and expects to realize
ongoing annual benefits well in excess of this amount.

INDEPENDENT PUBLIC ACCOUNTANTS

Effective May 20, 2002, the Board of Directors elected to dismiss Arthur
Andersen LLP ("Arthur Andersen") as the Company's independent auditors and
engage the services of Ernst & Young LLP ("E&Y") as the Company's new
independent auditors for the year ended December 28, 2002.

Arthur Andersen's reports on the Company's consolidated financial statements
for the fiscal year ended December 29, 2001 did not contain an adverse opinion
or disclaimer of opinion, nor were they qualified or modified as to uncertainty,
audit scope, or accounting principles. During the fiscal year ended December 29,
2001, and through May 20, 2002 (the Relevant Period), (1) there were no
disagreements with Arthur Andersen on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure which,
if not resolved to Arthur Andersen's satisfaction, would have caused Arthur
Andersen to make reference to the subject matter of the disagreement(s) in
connection with its reports on the Company's consolidated financial statements
for such year; and (2) there were no reportable events as described in Item
304(a)(1)(v) (Reportable Events) of the Commission's Regulation S-K.

During the Relevant Period, neither the Company nor anyone acting on the
Company's behalf consulted with E&Y regarding (i) the application of accounting
principles to a specified transaction, either completed or proposed, or the type
of audit opinion that might be rendered on the Company's consolidated financial
statements, or (ii) any matters or reportable events as set forth in Items
304(a)(1)(iv) and (v), respectively, of Regulation S-K.

E&Y served as independent public accountants for the Company for the fiscal
year ended December 28, 2002. Representatives of E&Y will be present at the
Annual Meeting of Shareholders and available to respond to appropriate
questions. The E&Y representatives will have the opportunity to make a statement
if they so desire.

Audit Fees. The aggregate fees billed by E&Y for professional services
rendered for the audit of the Company's annual financial statements for the
fiscal year ended December 28, 2002 and for the reviews of the financial
statements included in the Company's Quarterly Reports on Form 10-Q for the
fiscal year were $198,400.00. In addition, $8,000.00 in fees were paid to Arthur
Andersen for audit services and the review of the Company's first quarter 10-Q
report.

Financial Information Systems Design and Implementation Fees. E&Y did not
perform any information technology services relating to financial information
systems design and implementation in fiscal year 2002.

All Other Fees. The aggregate fees billed by E&Y for services rendered to
the Company, other than the services described above for the fiscal year ended
December 28, 2002, were $106,433.00, which primarily included tax compliance
services.

The Audit Committee of the Board of Directors does not believe "other fees"
referenced above have an adverse effect on E&Y's independence. Following the
adoption of the Sarbanes-Oxley Act in 2002, and the rules promulgated
thereunder, the Company's independent accountants are proscribed from offering
certain services to the Company. None of those proscribed services were provided
to the Company in 2002.

AVAILABILITY OF FORM 10-K

Shares of the Company's stock are traded under the symbol UFPI on The Nasdaq
Stock Market. The Company's 10-K Report filed with the Securities and Exchange
Commission will be provided free of charge to any shareholder upon written
request. Significant financial information is available on the Company's web
site at http://www.ufpi.com. For more information, contact the Investor
Relations Department, 2801 East Beltline NE, Grand Rapids, Michigan 49525.

SHAREHOLDER PROPOSALS

Shareholder proposals intended to be presented at the 2004 Annual Meeting of
Shareholders must be received by the Company no later than November 16, 2003, to
be considered for inclusion in the proxy materials relating to that meeting.
Proposals of shareholders should be addressed to the attention of Secretary,
2801 East Beltline NE, Grand Rapids, Michigan 49525. If the Company receives
notice of a shareholder proposal after February 2, 2004, the persons named as
proxies for the 2004 Annual Meeting of Shareholders will have discretionary
voting authority to vote on that proposal at the meeting.

HOUSEHOLDING OF PROXY MATERIALS

Effective with the 2002 Annual Meeting of Shareholders, only one annual
report and proxy statement will be sent to multiple shareholders sharing a
single address, unless the Company has received instructions to the contrary
from one or more of such shareholders. If you prefer to receive individual
copies of the proxy materials, send your request in writing to the attention of
Investor Relations, 2801 East Beltline NE, Grand Rapids, MI 49525, or call
888-BUY-UFPI.

FUTURE PROXY SOLICITATION

The Company has expanded its use of the Internet to solicit proxies from its
shareholders. As stated on the Notice of Annual Meeting, the Company will also
accept voting by telephone or via electronic mail. If, in the future, you are
interested in accepting proxy solicitations via the Internet, visit the
Company's web site at http://www.ufpi.com, and request to be put on the e-mail
list by clicking on the "Information Request" icon and follow the instructions
to have the proxy notification sent to you via e-mail.

March 17, 2003
By Order of the Board of Directors,

/s/ Matthew J. Missad
Matthew J. Missad, Secretary

APPENDIX A

UNIVERSAL FOREST PRODUCTS, INC.
AUDIT COMMITTEE CHARTER

EFFECTIVE MARCH 11, 2003

I. ROLE. The primary purpose of the Audit Committee is to assist the Board of
Directors in fulfilling its oversight responsibilities for management's
conduct of the Company's financial reporting processes and the Company's
system of internal controls regarding finance, accounting, legal compliance,
and ethics.

II. MEMBERSHIP AND MEETINGS. The Audit Committee shall be comprised of not less
than three (3) members of the Board of Directors. Each member of the
Committee must qualify as an independent director under the listing
requirements of The Nasdaq Stock Market. Accordingly, the members of the
Audit Committee will be directors:

- None of whom has any relationship to the Company that would interfere with
the exercise of his or her independent judgment as a member of the
Committee; and

- All of whom, as determined by the Board of Directors in its business
judgment, are financially literate and have a working familiarity with
basic financial and accounting practices and, as soon as possible
following the effective date of this Charter, at least one member of
Committee shall be a "financial expert" in compliance with the criteria
established by the Securities and Exchange Commission.

The Audit Committee will establish its meeting schedule, including executive
sessions with management, internal auditors, and the independent auditors.
Each regularly scheduled meeting of the Committee shall conclude with an
executive session of the Committee, absent members of management and on such
terms and conditions as the Committee may elect.

III.RESPONSIBILITIES. The Company's management is responsible for preparing the
Company's financial statements and the independent auditors are responsible
for auditing the Company's financial statements. Additionally, the Company's
financial management, including the internal audit staff as well as the
independent auditors, have more time, knowledge, and more detailed
information of the Company than does the Audit Committee. Consequently, the
Audit Committee's role is one of oversight and does not provide any expert
assurance or certification as to the Company's financial statements or the
work of the independent auditors or that of the internal audit staff.
However, the independent auditors and director of internal audit are
directly accountable to the Audit Committee. The following functions are the
common recurring activities of the Audit Committee in carrying out its
oversight function:

A. DOCUMENT AND REPORT REVIEW.

(1) Review and update this Charter periodically or as conditions dictate
(at least annually).

(2) Review the Company's annual financial statements and any reports or
other financial information submitted to any governmental body or to
the public, including any report issued by the independent
accountants.

(3) Review the summary report of the internal auditor and management's
response to such report.

(4) Undertake the required reviews and discussions and receive the
requisite materials for purposes of recommending to the Board whether
the financial statements should be included in the Annual Report on
Form 10-K as required under Item 306 of S-K.

(5) Review with financial management and the independent auditors the
quarterly report on Form 10-Q prior to its filing.

(6) Review earnings press releases with management prior to
dissemination.

(7) Discuss with management financial information and earnings guidance
provided to analysts and rating agencies.

B. INDEPENDENT AUDITORS.

(1) Appoint, approve the compensation of, and provide oversight of the
Company's independent auditor, including the removal of the Company's
independent auditors. The independent auditors shall report directly
to the Committee, and the Committee will oversee the resolution of
any disagreements between management and the independent auditors.

(2) On an annual basis, review and discuss with the independent auditors
all significant relationships the auditors have with the Company to
determine the auditors' objectivity and independence, undertaking or
recommending appropriate action to ensure and continue that
independence.

(3) Administer the Company's Policy Regarding the Approval of Audit and
Nonaudit Services Provided by the Independent Auditor.

(4) Following the effective date of the rules implementing Section 204 of
the Sarbanes-Oxley Act, review the independent auditors' report and
hold timely discussions with the independent auditors regarding the
content of that report, including the following:

(a) All critical accounting policies and practices;

(b) All alternative treatments of financial information within
generally accepted accounting principles that have been discussed
with management, ramifications of the use of such alternative
disclosures and treatments, and the treatment preferred by the
independent auditor;

(c) Other material written communications between the independent
auditor and management including, but not limited to, management
letter and schedule of unadjusted differences; and

(d) An analysis of the auditors' judgment as to the quality of the
Company's accounting principles, setting forth significant
reporting issues and judgments made in connection with the
preparation of the financial statements.

(5) At least annually, obtain and review a report by the independent
auditor describing:

(a) The firm's internal quality control procedures;

(b) Any material issues raised by the most recent internal
quality-control review, peer review, or by any inquiry or
investigation by governmental or professional authorities, within
the preceding five years, respecting one or more independent
audits carried out by the firm, and any steps taken to deal with
any such issues; and

C. FINANCIAL REPORTING PROCESSES.

(1) Review the integrity of the Company's financial reporting process,
both internal and external, giving consideration to consultation with
management, the independent auditors, and the internal auditor.

(2) Consider and approve, as appropriate, major changes to the Company's
auditing and accounting principles and practices as suggested by the
independent auditors, management, or the internal auditor.

(3) Review and approve all related party transactions.

(4) Establish and maintain procedures for the receipt, retention, and
treatment of complaints regarding accounting or auditing matters,
including procedures necessary to receive and respond to confidential
and anonymous submissions by Company employees regarding questionable
accounting or auditing matters.

(5) Review with management and the independent auditors the content of
their respective assessments to be filed under Section 404 of the
Sarbanes-Oxley Act.

D. INTERNAL AUDIT.

(1) The Audit Committee will oversee internal audit activities, including
discussing with management and the internal auditors the internal
audit function's organization, objectivity, responsibilities, plans,
results, budgets, and staffing.

E. ETHICAL AND LEGAL COMPLIANCE.

(1) Review the Company's Code of Conduct, approved by the Board of
Directors, to ensure that management has maintained a system to
comply with expected ethical and legal requirements.

(2) Review, with the Company's counsel, legal compliance matters
including corporate securities trading policies.

(3) Review, with the Company's counsel, any legal matters that could have
a significant impact on the Company's financial statements.

(4) Discuss the Company's major financial and accounting risk exposures
and steps taken by management to control or mitigate those exposures.

F. OTHER.

(1) Perform an annual self-assessment relative to the Audit Committee's
purpose, duties, and responsibilities set forth in this Charter.

(2) To the extent it deems appropriate, obtain advice and assistance from
outside legal, accounting, or other advisors as deemed appropriate to
perform its duties and responsibilities.

(3) Perform any other activities consistent with this Charter, the
Company's Bylaws and governing law, as the Audit Committee or the
Board of Directors deems necessary or appropriate.

ANNUAL MEETING OF SHAREHOLDERS OF

UNIVERSAL FOREST PRODUCTS, INC.

APRIL 16, 2003

Please date, sign and mail
your proxy card in the
envelope provided as soon
as possible.

\/ Please detach and mail in the envelope provided. \/

PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [x]

1. Directors to be Elected by Holders of Common Stock This Proxy, when properly executed, will be voted in the manner
directed herein by the undersigned shareholder. If direction is
NOMINEES: made, this Proxy will be voted FOR all nominees listed in
[ ] FOR ALL NOMINEES O Dan M. Dutton Proposal 1.
O John M. Engler
[ ] WITHHOLD AUTHORITY O John W. Garside
FOR ALL NOMINEES O Gary F. Goode
O Peter F. Secchia

[ ] FOR ALL EXCEPT
(See instructions below)

INSTRUCTION: To withhold authority to vote for any individual nominee(s), mark
"FOR ALL EXCEPT" and fill in the circle next to each nominee you wish to
withhold, as shown here:__________

To change the address on your account, please check the box at right and
indicate your new address in the address space above. Please note that changes
to the registered name(s) on the account may not be submitted via this method. [ ]

Signature of Shareholder _____________________ Date: _______ Signature of Shareholder _________________________ Date: _______

Note: Please sign exactly as your name or names appear on this Proxy. When
shares are held jointly, each holder should sign. When signing as
executor, administrator, attorney, trustee or guardian, please give
full title as such. If the signer is a corporation, please sign full
corporate name by duly authorized officer, giving full title as such.
If signer is a partnership, please sign in partnership name by
authorized person.

UNIVERSAL FOREST PRODUCTS, INC.

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints William G. Currie and Matthew J. Missad as
Proxies, each with the power to appoint his substitute, and hereby authorizes
them to represent and to vote, as designated on the reverse side, all the shares
of Common Stock of Universal Forest Products, Inc. held of record by the
undersigned on March 1, 2003 at the Annual Meeting of Shareholders to be held
April 16, 2003, and at any adjournment thereof.

(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE)

ANNUAL MEETING OF SHAREHOLDERS OF

UNIVERSAL FOREST PRODUCTS, INC.

APRIL 16, 2003

PROXY VOTING INSTRUCTIONS

MAIL - Date, sign and mail your proxy card in the
envelope provided as soon as possible. COMPANY NUMBER
- OR -
TELEPHONE - Call toll-free 1-800-PROXIES from
any touch-tone telephone and follow the instructions. ACCOUNT NUMBER
Have your control number and proxy card available
when you call.
- OR - CONTROL NUMBER
INTERNET - Access "WWW.VOTEPROXY.COM" and follow the
on-screen instructions. Have your control number
available when you access the web page.

\/ Please detach and mail in the envelope provided IF you are not voting via telephone or the Internet. \/

PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]

[ ] FOR ALL EXCEPT
(See instructions below)

INSTRUCTION: To withhold authority to vote for any individual nominee(s), mark
"FOR ALL EXCEPT" and fill in the circle next to each nominee you wish to
withhold, as shown here:

Signature of Shareholder _____________________ Date: _______ Signature of Shareholder _________________________ Date: _______

NOTE: This proxy must be signed exactly as the name appears hereon. When
shares are held jointly, each holder should sign. When signing as
executor, administrator, attorney, trustee or guardian, please give
full title as such. If the signer is a corporation, please sign full
corporate name by duly authorized officer, giving full title as such.
If signer is a partnership, please sign in partnership name by
authorized person.