<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                               Washington, D. C.
                                     20549


                                  FORM 10-K/A


                     ANNUAL REPORT PURSUANT TO SECTION 13 OF
                       THE SECURITIES EXCHANGE ACT OF 1934


                   For the Fiscal Year Ended December 31, 1996

                          Commission file number 0-6087


                            LINDAL CEDAR HOMES, INC.
                            (A Delaware Corporation)


                4300 South 104th Place, Seattle, Washington 98178

                        Telephone number: (206) 725-0900

                  I.R.S. Employer Identification No. 91-0508250


           Securities registered pursuant to Section 12(g) of the Act:
                     Common stock, par value $.01 per share


            This Amendment, excluding cover page, contains 14 pages


<PAGE>   2

                       SECURITIES AND EXCHANGE COMMISSION

                            Washington, D. C. 20549

                                  FORM 10-K/A

[X]    Annual report pursuant to Section 13 or 15(d) of the Securities Exchange
       Act of 1934 for the fiscal year ended December 31, 1996

[ ]    Transition report pursuant to Section 13 or 15(d) of the Securities
       Exchange Act of 1934 for the transition period 
       from ____________ to ______________

Commission file number 0-6087

                            LINDAL CEDAR HOMES, INC.
-------------------------------------------------------------------------------
               (Exact name of registrant as specified in charter)


               Delaware                                  91-0508250
----------------------------------------------   ----------------------------
      (State or other jurisdiction                    (I.R.S. Employer 
            of organization)                          Identification No.)
 
4300 South 104th Place, Seattle, Washington              98178
-----------------------------------------------------------------------------
(Address of principal executive offices)               (Zip Code)


(Registrant's telephone number, including area code)             (206) 725-0900


Securities registered pursuant to Section 12(b) of the Act:  None
Securities registered pursuant to Section 12(g) of the Act:  Common stock, par 
                                                             value $.01 per 
                                                             share
                                                             (Title of Class)

Aggregate market price of shares held by nonaffiliates at March 18, 1997 was
$6,549,944, consisting of 1,690,308 shares.

The number of shares of common stock outstanding on March 18, 1997 was 4,091,136
shares.

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding twelve months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes  X  No 
                                       ---    ---
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. ( )

The total number of pages in this Form 10-KA is 14.




                                      -1-
<PAGE>   3

                                    PART III

ITEM 10.       DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
 
         The Board of Directors presently consists of nine members. Five members
of the Board of Directors will be elected at the meeting: Douglas F. Lindal,
Harry A. Pryde, William F. Lorenz, Sir Walter Lindal, and William M. Weisfield
will be elected for two-year terms expiring at the 1999 Annual Meeting and until
their respective successors have been elected and qualified. The directors will
be elected by a plurality vote of the shares represented, in person or by proxy,
at the meeting.
 
         Each year the Board of Directors has traditionally selected a nominee
for director from among the Company's distributors. The Company believes this
improves relationships with its distributors by giving them a voice in the
decision-making process and provides the Company with an additional source of
information about its markets. The Board of Directors selected Bill Lorenz from
among its distributors as a nominee for election as a director at the 1997
Annual Meeting.
 
         Each of the nominees for director has indicated that he is willing and
able to serve as a director. If any nominee becomes unable or unwilling to
serve, the accompanying proxy may be voted for the election of such other person
as shall be designated by the Board of Directors.
 
         During 1996, there were six meetings of the Board of Directors. No
director attended fewer than 75% of the meetings of the Board of Directors and
the various committees thereof at which he or she was entitled to vote, except
that Harry A. Pryde attended four of the six full Board Meetings.
 



                                      -2-
<PAGE>   4
 
         The following table sets forth information regarding each continuing
director, each nominee for election as a director, and each executive officer of
the Company:
 
<TABLE>
<CAPTION>
         NAME(1)             AGE         DIRECTOR SINCE             POSITION WITH COMPANY
--------------------------   ----  --------------------------  --------------------------------
<S>                          <C>   <C>                         <C>
Sir Walter Lindal(2)......    78   1966 - 1975 & 1978 on       Chairman Emeritus of the Board
                                                               of Directors, Secretary and
                                                                 Director
Robert W. Lindal(2).......    49   1969 - 1975 & 1976 on       Chairman of the Board of
                                                               Directors and Chief Executive
                                                                 Officer
Douglas F. Lindal(2)......    46   1971 - 1975 & 1980 on       President, Chief Operating
                                                               Officer and Director
Bonnie G. McLennaghan(2)..    52   1966 - 1981 & 1984 - 1993   Vice President
Martin J. Lindal(2).......    43   1981                        Vice President Information
                                                               Systems & Assistant Secretary
                                                                 and Director
Everett G. Martin.........    73   1986                        Vice President; Midwest &
                                                               Eastern Canada and Director
Harry A. Pryde............    66   1994                        Director
William F. Lorenz.........    54   --                          Nominee for Director
Charles R. Widman.........    71   1993                        Director
William M. Weisfield......    55   1994                        Director
Richard C. Bendix.........    48                               Vice President Marketing
Gary D. Kline.............    48                               Vice President Operations
</TABLE>
 
---------------
 
(1) Each of the individuals listed are continuing directors or nominees for
    director except Messrs. Bendix and Kline, and Ms. McLennaghan who serve
    solely in their capacities as executive officers of the Company. Each
    executive officer is elected by the Board of Directors following the Annual
    Meeting of Shareholders to serve for a term of one year or until a successor
    is elected and qualified. The address of each of the individuals listed is
    the address of the Company's headquarters at 4300 South 104th Place,
    Seattle, Washington 98178.
 
(2) Robert W. Lindal, Martin J. Lindal and Douglas F. Lindal are sons, and
    Bonnie G. McLennaghan is the daughter of Sir Walter Lindal.
 
         DOUGLAS F. LINDAL was Executive Vice President from 1981 until January
1995, when he became President and Chief Operating Officer of the Company. Mr.
Lindal continues to have the sales, marketing and administration areas report to
him as well as function as General Manager supervising most Company activities.
He has served as a Director of the Company from 1971 to 1975 and from 1980 to
the present. Prior to 1981, Mr. Lindal also was an independent distributor for
the Company's products in Hawaii.
 
         HARRY A. PRYDE is currently the president of The Pryde Corporation, a
full service property management firm and a builder/developer of single and
multi-family housing. He is also a member of the board of directors of
Enterprise Bank and several non-profit entities. Mr. Pryde is a past president
of the National Association of Home Builders, as well as the Seattle Master
Builders Association and the Washington State Home Builders Association. He was
first elected a Director of the Company in 1994.
 
         SIR WALTER LINDAL was Chairman of the Board from 1981 until January
1995, when he became Chairman Emeritus of the Company. Mr. Lindal has been
Secretary of the Company since 1981. From 1966 to 1975 he was President of the
Company and Chairman of the Board and actively managed the Company. Mr. Lindal
is the Company's founder.
 
         WILLIAM F. LORENZ has been the President of Southern Wisconsin Cedar
Homes, a dealer of the Company, since 1991. In 1996, Mr. Lorenz was elected to
the Dealer Advisory Council.
 
         WILLIAM M. WEISFIELD has been the chief operating officer of Northern
Capital Company, a privately held investment company in Seattle, Washington
since January 1994. From December 1992 to December 1993,




                                      -3-
<PAGE>   5
 
Mr. Weisfield was the chief operating officer of The Robbins Company in Kent,
Washington, a manufacturer of underground tunnel boring machines. From 1988 to
December 1992, Mr. Weisfield was the Chief Executive Officer of Cornerstone
Columbia Development Company, a Seattle, Washington real estate development
firm. From 1978 to 1982, Mr. Weisfield was Chairman of the Board of the Federal
Home Loan Bank of Seattle and he is currently a member of the Board of Regents
of Seattle University. Mr. Weisfield currently is also the Chairman of the Board
of Directors of UTILX Corporation, a NASDAQ traded company, and several
non-public entities.
 
         ROBERT W. LINDAL was President of the Company from 1981 to January
1995, when he became Chairman of the Board. He has been the Chief Executive
Officer of the Company since 1981. Mr. Lindal continues to have the operations
and finance areas of the Company report to him. Mr. Lindal has been a Director
of the Company from 1969 to 1975 and 1976 to the present. Prior to 1981, Mr.
Lindal was an independent distributor for the Company's products in Hawaii, and
the Canadian Production Facilities Manager for the Company. Mr. Lindal is a
structural engineer.
 
         CHARLES R. WIDMAN has been the President of Widman Associates, Inc.,
forest industry analysts, since 1993. From 1991 to 1993, Mr. Widman was an
executive consultant with Sandwell, Inc., a diversified international consulting
firm specializing in engineering and the forest industry. From 1978 to 1991, he
was Chairman and CEO of Widman Management Limited. After being purchased by
Sandwell, Inc. in 1991, Widman Management Limited continues to operate as Widman
Management Consultants. Mr. Widman was first elected a Director in 1993.
 
         MARTIN J. LINDAL has served as a director of the Company since 1981,
and was employed by the Company as Administration Manager in 1982. Mr. Lindal
was elected Assistant Secretary in 1986 and Vice President Information Systems &
Assistant Secretary in 1990.
 
         EVERETT G. MARTIN has been employed by the Company since 1967 in a
variety of key sales and administrative positions. Mr. Martin has been
associated with this Company and its predecessors in a variety of positions
since 1951. For the past twenty-nine years he has been the Supervisor of the
Company's midwest U.S. and eastern Canada operations. Mr. Martin was elected
Vice President Midwest & Eastern Canada in 1986. Mr. Martin has served as a
Director since 1986.
 
         RICHARD C. BENDIX joined the Company in 1988 as marketing manager and
in 1989 was named Vice President Marketing. Prior to joining the Company, Mr.
Bendix was employed by Monterey Domes Inc. from 1980 to 1988 where he last
served as Executive Vice President.
 
         BONNIE G. MCLENNAGHAN has been active in marketing as Publications
Director since the Company's formation in 1966 and served as an officer and
director of the Company from 1966 to 1981 and as a director from 1984 to
February 1993. From 1981 to 1986, Mrs. McLennaghan was Director of Publications.
In 1986, she was elected Vice President Publications and in 1990 was elected
Vice President.
 
         GARY D. KLINE joined the Company in 1973 and has worked in several key
positions in the scheduling and production areas. Mr. Kline was elected Vice
President Operations in 1983.
 
  Compliance With Section 16 Of The Securities Exchange Act Of 1934
 
         Section 16 of the Securities Exchange Act of 1934 and rules adopted
thereunder establish requirements for officers, directors and beneficial owners
of ten percent or more of the Company's outstanding common stock to report
transactions and holdings in the Company's securities.
 
         With respect to 1996, the Company believes, based upon copies of
reports furnished to it and written representations that no other reports were
required, that all filings under Section 16 were made in a timely fashion except
that Mr. Rick Stanley, whose term as director expires with the upcoming
shareholder meeting, filed his Form 4 for February 1997 one day late.
 


                                      -4-
<PAGE>   6
ITEM 11.       EXECUTIVE COMPENSATION

         The annual retainer for each director, who was not an employee of the
Company, is $4,000, payable $1,000 per quarter, and 1,000 shares of the
Company's common stock. The chairman of each committee is paid $1,000 a year. A
fee of $500 is paid for each meeting of the Board of Directors or committee of
the Board of Directors attended and for significant non-Board or committee
meetings. A fee of $250 is paid for each meeting of the Board of Directors or
committee of the Board of Directors where the Board member participates by
phone.
 
         Pursuant to the standard compensation program, in November 1996 each of
Messrs. Pryde, Widman and Weisfield were granted 1,000 shares of the Company's
stock. As the stock issued was not registered, all certificates bear the
appropriate restrictive legend. The market price of the stock on the date of
issuance was $3.75.
 
         Each Director who is not an employee of the Company is eligible to
participate in the Directors' and Distributors' Stock Option Plan ("Plan"). At
the 1995 Annual Meeting, an Amendment to the Plan was approved by the
shareholders providing that each non-employee Director would receive options to
purchase 10,000 shares upon becoming a Director and options to purchase 5,000
shares as of October 1 of each year he or she continues as a Director. The
nonemployee Directors in office when this amendment was approved were granted,
effective the day the amendment was approved, options to purchase 10,000 shares
of the Company's common stock. The exercise price of options granted under the
Plan is the market price of the Company's stock on the date of grant. In
November 1996, Messrs. Pryde, Widman and Weisfield were each granted options to
purchase 5,000 at a price of $4.13 per share.
 
         Options granted to non-employee Directors are nonassignable except by
will or the laws of dissent and distribution. Options granted are automatically
fully vested and are exercisable six (6) months after the date of grant. Options
granted to non-employee Directors expire at the earlier of ten (10) years from
the grant date, one year after the option holder ceases to be a Director for any
reason other than death, or one (1) year after death. However, options granted
to Directors who are also Company distributors are subject to the vesting and
expiration rules described in the next paragraph for options granted to
distributors.
 
         Non-employee Directors who are also Company distributors, and other
members of the Dealer Advisory Council, are eligible to receive options to
purchase shares of the Company's stock each year in the amount of 100 shares for
each year during which the person was a member of the Council (without regard to
years of service as a Director). Mr. Lorenz is a member of the Council and is
eligible for options granted under the Plan. In 1996, options to purchase 100
shares were granted to Mr. Lorenz for his participation on the Council. Options
granted to distributors under the Plan vest over a period of four (4) years and
expire at the earliest of ten (10) years following the date of grant or ninety
(90) days after the option holder ceases to be a distributor (or one year after
death).
 


                                      -5-
<PAGE>   7
         The following table shows the compensation for services rendered during
fiscal years 1996, 1995 and 1994 for the Chief Executive Officer and each of the
four highest paid executive officers of the Company whose aggregate salary and
bonus exceeded $100,000 in the most recent fiscal year.
 
                           SUMMARY COMPENSATION TABLE
 
<TABLE>
<CAPTION>
                                                                       LONG-TERM
                                                     ANNUAL           COMPENSATION
                                                  COMPENSATION           AWARDS
                                               ------------------     ------------          OTHER
              NAME AND                         SALARY(1)   BONUS        OPTIONS        COMPENSATION(2)
         PRINCIPAL POSITION           YEAR       ($)        ($)           (#)                ($)
------------------------------------  ----     -------     ------     ------------     ---------------
<S>                                   <C>      <C>         <C>        <C>              <C>
Robert W. Lindal....................  1996     177,404     60,537      20,100               7,636
CEO/Chairman                          1995     176,532     38,350         0                 5,858
                                      1994     153,766     20,350      10,000               5,849
Douglas F. Lindal...................  1996     160,366     60,969      20,100               5,306
President                             1995     151,175     38,359         0                 3,721
                                      1994     133,424     20,589      10,000               3,721
Sir Walter Lindal...................  1996     159,669     26,000      20,100               3,023
Secretary                             1995     161,397     22,000         0                 2,945
                                      1994     139,992     14,000      10,000               2,541
Martin J. Lindal....................  1996      99,223     15,096      20,100               4,212
Vice President Information            1995      97,444     11,566         0                 3,157
Systems and Assistant Secretary       1994      79,666      9,066      10,000               2,691
</TABLE>
 
---------------
 
(1) Includes base salary; taxable life insurance in accordance with the
    Company's term life insurance plan; life insurance premiums paid for Mr.
    Robert W. Lindal; purchase of a portion of each named executive's unused
    accrued paid time off; cash paid for business use of personal automobile for
    which there is no accounting to the Company for Mr. Douglas F. Lindal; and
    amounts paid for medical expenses not covered by the Company's medical plan
    under a program available only to executives for Robert W. Lindal, Sir
    Walter Lindal, and Mr. Douglas F. Lindal.
 
(2) For Messrs. Robert W. Lindal, Douglas F. Lindal, and Martin J. Lindal, Other
    Compensation consists of amounts contributed, at the discretion of the Board
    of Directors, to the Company's 401(k) Plan and a 25% matching contribution
    of such employees' contributions to the Plan. For Mr. Robert W. Lindal, it
    also includes the benefit of personal use of a Company automobile. For Sir
    Walter Lindal, Other Compensation consists of the benefit of personal use of
    a Company automobile.
 
                       OPTION GRANTS IN LAST FISCAL YEAR
 
     The Company has two employee stock option plans, an Incentive Stock Option
Plan effective December 21, 1984 ("1984 Plan") and a 1988 Combined Incentive and
Nonqualified Stock Option Plan adopted at the Company's 1988 Annual Meeting of
Shareholders ("1988 Plan"). Options to purchase common stock have been granted
under the plans to officers and key employees of the Company. The 1984 Plan
expired on December 21, 1994. The following tables show stock option grants and
exercises in fiscal year 1996 by the executive officers of the Company and the
year end values of unexercised options.
 


                                      -6-
<PAGE>   8

                               INDIVIDUAL GRANTS
 
<TABLE>
<CAPTION>
                                                                                       POTENTIAL REALIZABLE
                                                                                               VALUE
                                                                                         AT ASSUMED ANNUAL
                                                                                             RATES OF
                                           % OF TOTAL                                       STOCK PRICE
                                             OPTIONS                                       APPRECIATION
                                           GRANTED TO       EXERCISE                      FOR OPTION TERM
                             OPTIONS      EMPLOYEES IN       OR BASE                   ---------------------
                           GRANTED(1)      FISCAL YEAR      PRICE(2)      EXPIRATION     5%            10%
          NAME                 (#)             (%)             ($)           DATE       ($)            ($)
          (A)                  (B)             (C)             (D)           (E)        (F)            (G)
------------------------  -------------   -------------   -------------   ----------   ------         ------
<S>                       <C>             <C>             <C>             <C>          <C>            <C>
Robert W. Lindal........      10,000          4.48%            3.75          3/27/06   23,584         59,765
                              10,100          4.52%            3.75         10/31/06   23,819         60,363
Douglas F. Lindal.......      10,000          4.48%            3.75          3/27/06   23,584         59,765
                              10,100          4.52%            3.75         10/31/06   23,819         60,363
Sir Walter Lindal.......      10,000          4.48%            3.75          3/27/06   23,584         59,765
                              10,100          4.52%            3.75         10/31/06   23,819         60,363
Martin J. Lindal........      10,000          4.48%            3.75          3/27/06   23,584         59,765
                              10,100          4.52%            3.75         10/31/06   23,819         60,363
</TABLE>
 
---------------
 
(1) The options were granted for a term of 10 years and are immediately
    exercisable.
 
(2) The options have an exercise price equal to the market value on the date of
    grant.
 
                AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
                       AND FISCAL YEAR-END OPTION VALUES
 
<TABLE>
<CAPTION>
                                                            NUMBER OF UNEXERCISED         VALUE OF UNEXERCISED
                                  SHARES                     OPTIONS AT YEAR-END          IN THE MONEY OPTIONS,
                                ACQUIRED ON    VALUE     ---------------------------         AT YEAR-END (2)
                                EXERCISE(1)   REALIZED   EXERCISABLE   UNEXERCISABLE   ---------------------------
             NAME                   (#)         ($)          (#)            (#)        EXERCISABLE   UNEXERCISABLE
             (A)                    (B)         (C)          (D)            (D)          ($)(E)         ($)(F)
------------------------------  -----------   --------   -----------   -------------   -----------   -------------
<S>                             <C>           <C>        <C>           <C>             <C>           <C>
Robert W. Lindal..............       0            0         40,600           0            10,812           0
Douglas F. Lindal.............       0            0         40,600           0            10,812           0
Sir Walter Lindal.............       0            0         40,600           0            10,812           0
Martin J. Lindal..............       0            0         40,600           0            10,812           0
</TABLE>
 
---------------
 
(1) Number of securities underlying options exercised.
 
(2) Based on a fair market value at fiscal year-end of $4.375.
 
            COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
 
COMPENSATION COMMITTEE
 
         In 1996, the Compensation Committee (the "Committee") was composed of
two of the Company's outside directors, William M. Weisfield and Charles R.
Widman. The Committee is responsible for the establishing and administering of
policies that govern compensation for the Chief Executive Officer and other
executive officers who own 5% or more of the Company's outstanding common stock
("Owner/Officers") and governs the Company's stock option program. The Committee
is also directly involved with the setting of the compensation of other
executive officers.
 

                                      -7-
<PAGE>   9

COMPENSATION POLICIES
 
         The Committee bases executive officer compensation on the same guiding
principals used to determine compensation programs for all employees. The
Company seeks to offer pay and benefits that allow the Company to:
 
         (A) Attract and retain people with the skills critical to achieve long
             term success of the Company,
 
         (B) Maintain compensation costs that are competitive, and
 
         (C) Pay for performance to both motivate and reward individual and team
             performance in attaining business objectives and maximizing
             shareholder value.
 
FORMS OF COMPENSATION
 
         Compensation for the Owner/Officers is based on the above Policies and
consists of the following components: competitive base pay, bonuses, stock
options and competitive benefits.
 
         Base Salary. The Committee reviews and approves all salary changes for
Owner/Officers. The Committee bases its approval of individual salary levels on
the compensation budget for the Company, performance-based evaluations,
recommendations by the Executive Committee and comparisons to published
compensation levels for manufacturing companies of similar size and
profitability. In 1994, the Committee approved recommended adjustments in the
base salary of the Owner/Officers to a level which would allow for the
implementation of a meaningful bonus program in 1995. Accordingly, the Executive
Committee recommended and the Committee approved that the base salary of the
Owner/Officers, as a group, be increased approximately 25% effective September
1, 1994. The base salary of Mr. Robert Lindal, the Chief Executive Officer,
increased from approximately $142,000 per year to approximately $173,000 per
year, effective September 1, 1994.
 
         Bonus. The Committee has devised a bonus plan that is based on selected
performance criteria, emphasizing the pre-tax profitability of the Company. For
the Chief Executive Officer, the amount of any bonus payment is based solely on
the pre-tax earnings of the Company. The Committee consulted with independent
compensation experts when devising this plan. The plan was implemented for
Owner/Officers and other executive officers in 1995.
 
         The bonus plan, among other things, defines the bonus pool that is to
be available for distribution to the Owner/Officers and other executive
officers. If pre-tax earnings are $500,000 or less there is no bonus. For
pre-tax earnings from $500,000 to $1,000,000, 10% of pre-tax earnings is the
bonus pool. For pretax earnings over $1,000,000 to a maximum of $3,000,000, 20%
of pre-tax earnings is added to the bonus pool. The available bonus pool is then
divided among the Owner/Officers and other executive officers according to a
predetermined percentage.
 
         Stock Options. Nonqualified or incentive options are periodically
granted to all Owner/Officers. Incentive stock options are periodically granted
to other executive officers and certain other employees by the Compensation
Committee.



                                      -8-
<PAGE>   10
 
1996 COMPENSATION
 
         As part of the process of formulating a revised bonus plan for 1995, in
late 1994 the Committee reviewed the base salaries of the Owner/Officers. It was
determined, through consultations with independent compensation experts, that
the base salary of the Owner/Officers needed to be adjusted to arrive at a level
that allowed a workable bonus plan.
 
         For the 12 months of 1996, the salary of Mr. Robert Lindal increased
 .5% over 1995.
 
         It is the opinion of the Committee, based upon input from independent
compensation consultants, that the current base salaries are consistent with
base salaries for manufacturing companies of similar size.
 
                                          COMPENSATION COMMITTEE
 
                                          William M. Weisfield, Chairman
                                          Charles R. Widman




                                      -9-
<PAGE>   11
 
                         STOCK PRICE PERFORMANCE GRAPH
 
     The graph below compares for each of the last five calendar years ending
December 31, 1996 the cumulative total return of the Company, the NASDAQ Market
Index and the Media General Residential Construction Index. Cumulative total
return assumes $100 invested January 1, 1992 and reinvestment of all dividends.
 
                     COMPARE 5-YEAR CUMULATIVE TOTAL RETURN
                         AMONG LINDAL CEDAR HOMES INC,
                     NASDAQ MARKET INDEX AND MG GROUP INDEX
 
<TABLE>
<CAPTION>
        MEASUREMENT PERIOD             LINDEL CEDAR
      (FISCAL YEAR COVERED)             HOMES INC.        INDUSTRY INDEX       BROAD MARKET
<S>                                  <C>                 <C>                 <C>
1991                                               100                 100                 100
1992                                            134.26              112.85              100.98
1993                                            127.33              149.26              121.13
1994                                             66.21               90.33              127.17
1995                                             91.68              129.99              164.96
1996                                             89.13              130.75              204.98
</TABLE>
 
Assumes $100 invested on January 1, 1992.
Assumes dividend reinvested.
Fiscal year ending December 31, 1996.
 



                                      -10-
<PAGE>   12

ITEM 12.       SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         At the close of business on April 9, 1997 there were 4,091,136 shares
of common stock outstanding, which represent all of the voting securities of the
Company. Each share of common stock is entitled to one vote. Only shareholders
of record at the close of business on April 14, 1997 will be entitled to vote at
the meeting. Shareholders have cumulative voting rights with respect to the
election of directors and may exercise these rights without giving any notice or
taking any other prior action. The existence of cumulative voting rights means
that a shareholder may cast a total number of votes in the election of directors
which is equal to the number of directors to be elected multiplied by the number
of such shareholder's shares. Such votes may be cast entirely for one candidate
or may be distributed equally or disproportionately among as many candidates as
the shareholder may consider appropriate.
 
         A shareholder may vote in person or by proxy. A proxy must be in
writing and dated and signed by the shareholder. A shareholder giving a proxy
has the power to revoke it at any time before it is voted.
 
         The following table sets forth as of April 9, 1997 certain information
as to the number of shares of common stock beneficially owned by each person who
is known to the Company to own beneficially more than 5% of its outstanding
common stock or who is a Company director or nominee for director, and by all
officers and directors of the Company as a group:
 
                      BENEFICIAL OWNERSHIP OF COMMON STOCK
 
<TABLE>
<CAPTION>
                                                              NUMBER OF         PERCENTAGE OF
    NAME                                                     SHARES(1)(5)     OUTSTANDING SHARES
    ----                                                     ------------     ------------------
    <S>                                                      <C>              <C>
    Sir Walter Lindal(2)...................................      951,133(3)          21.58%
    Robert W. Lindal(2)....................................      442,614(4)          10.04
    Douglas F. Lindal(2)...................................      391,156              8.87
    Bonnie G. McLennaghan(2)...............................      401,168(4)(6)        9.10
    Martin J. Lindal(2)....................................      372,088(4)           8.44
    Everett G. Martin......................................       46,664              1.06
    Harry A. Pryde.........................................       23,017               *
    William F. Lorenz......................................           40               *
    Charles R. Widman......................................       23,725               *
    William M. Weisfield...................................       23,017               *
    All officers and directors as a group (13 persons).....    2,714,864             61.59
</TABLE>
 



                                      -11-
<PAGE>   13
 
---------------
 
 *  Less than one percent.
 
(1) Beneficial ownership includes both voting power and investment power.
 
(2) Robert W. Lindal, Martin J. Lindal and Douglas F. Lindal are sons, and
    Bonnie G. McLennaghan is the daughter, of Sir Walter Lindal. The address of
    each of the individuals listed is the address of the Company's headquarters
    at 4300 South 104th Place, Seattle, Washington 98178.
 
(3) Includes 772,898 shares held by Lindal, Inc., a private corporation
    controlled by Sir Walter Lindal in which all adult members of the Lindal
    family have an ownership interest.
 
(4) Does not include 772,898 shares owned by Lindal, Inc.
 
(5) With respect to each such individual and to all officers and directors as a
    group, the beneficial ownership data includes options to purchase common
    stock exercisable within 60 days as follows: (i) options to purchase 40,600
    shares held by each of Sir Walter Lindal, Robert W. Lindal, Douglas F.
    Lindal, Martin J. Lindal and Bonnie G. McLennaghan, (ii) options to purchase
    11,812 shares held by Everett G. Martin, (iii) options to purchase 21,017
    shares held by Harry A. Pryde and William M. Weisfield, (iv) options to
    purchase 40 shares held by William F. Lorenz, (v) options to purchase 21,725
    shares held by Charles R. Widman, (vi) options to purchase 316,486 shares
    held by all directors and officers as a group.
 
(6) Includes options to purchase 10,000 shares held by Robert McLennaghan, the
    husband of Bonnie G. McLennaghan.
 
ITEM 13.       CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         WILLIAM F. LORENZ is the President of Southern Wisconsin Cedar Homes,
an independent dealership of the Company. Sales to Southern Wisconsin Cedar
Homes were $732,000 in 1996. All sales were on normal trade terms.
 
         In 1996, the Company made payments aggregating $47,304 to Lindal family
members under a variety of agreements. Of this amount, $34,000 was paid to
Lindal, Inc., in connection with certain royalty agreements, and $6,652 was paid
to each of Robert W. Lindal and Douglas F. Lindal for rental payments on
property owned by them which is leased by the Company. See also Notes 4(d) and
8 to the consolidated financial statements on pages 31 and 35 of the Company's
form 10-K, to which this report is an amendment.
 


                                      -12-
<PAGE>   14

                                   SIGNATURES


         Pursuant to the requirements of Section 13 of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.

                                      LINDAL CEDAR HOMES, INC.


March 31, 1997
                                        /s/ ROBERT W. LINDAL
                                      -----------------------------------------
                                      Robert W. Lindal, Chairman


         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed by the following persons on behalf of the registrant
and in the capacities and on the dates indicated.


<TABLE>
<S>      <C>              <C>                                 <C>    <C>             <C>
Date       4/30/97         /s/   SIR WALTER LINDAL            Date      4/30/97             /s/ ROBERT W. LINDAL
         ------------    --------------------------------            ------------   ---------------------------------
                                Sir Walter Lindal                                            Robert W. Lindal
                             Director and Secretary                                         Director, Chairman
                                                                                       and Chief Executive Officer


Date       4/30/97          /s/  DOUGLAS F. LINDAL            Date     4/30/97                 /s/ MARTIN J. LINDAL
         ------------    --------------------------------            ------------   ---------------------------------
                                Douglas F. Lindal                                            Martin J. Lindal
                               Director, President                                             Director and
                           and Chief Operating Officer                                  Vice President Information
                                                                                               Systems and
                                                                                           Assistant Secretary


Date        4/30/97         /s/  JOHN F. DACY                Date
         ------------    --------------------------------            ------------   ---------------------------------
                                  John F. Dacy                                             Everett G. Martin
                             Vice President Finance                                        Director and Vice
                                  and Treasurer                                            President Midwest
                            (Principal Financial and                                       and Eastern Canada
                               Accounting Officer)
</TABLE>



                                      -13-

<PAGE>   15


<TABLE>
<S>      <C>              <C>                                 <C>    <C>             <C>
Date                                                         Date
         ------------    --------------------------------            ------------   ---------------------------------
                                 Harry A. Pryde                                              Rick L. Stanley
                                    Director                                                     Director


Date       4/29/97         /s/ WILLIAM W. WEISFIELD          Date
         ------------    --------------------------------            ------------   ---------------------------------
                              William M. Weisfield                                          Charles R. Widman
                                    Director                                                     Director
</TABLE>




                                      -14-