<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
RAYOVAC CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total fee paid:
-----------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-----------------------------------------------------------------------
(3) Filing Party:
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(4) Date Filed:
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<PAGE>
[LOGO]
RAYOVAC CORPORATION
601 RAYOVAC DRIVE
MADISON, WISCONSIN 53711
21 June 1999
Dear Shareholder:
On Thursday, 22 July 1999, Rayovac Corporation will hold its annual meeting of
shareholders. On behalf of the Board of Directors, I am pleased to invite you to
join us so we can report to you on the activities of Rayovac during 1998 and
discuss the outlook for 1999. The meeting will be held at our headquarters at
601 Rayovac Drive, Madison, Wisconsin and is scheduled to begin at 8:00 a.m.
This year you are being asked to act on the following matters: (1) the election
of directors and (2) the ratification of the Board of Directors' appointment of
independent auditors for 1999. These proposals are described in the attached
proxy statement which you are encouraged to read fully.
Whether or not you plan to attend the meeting, it is important that your shares
be represented at the annual meeting. Regardless of the number of shares you
own, please complete, sign, date, and return the enclosed proxy promptly.
We appreciate your continued support.
Sincerely,
David A. Jones
CHAIRMAN AND
CHIEF EXECUTIVE OFFICER
<PAGE>
RAYOVAC CORPORATION
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders of Rayovac Corporation:
The annual meeting of the shareholders of Rayovac Corporation (the "Annual
Meeting") will be held at the Company's headquarters, 601 Rayovac Drive,
Madison, Wisconsin 53711, on Thursday, 22 July 1999, at 8:00 a.m., Wisconsin
time, for the following purposes:
1. To elect (a) one (1) director of the Company for a term expiring at the
2000 Annual Meeting; (b) one (1) director of the Company for a term
expiring at the 2001 Annual Meeting; and (c) two (2) directors of the
Company for terms expiring at the 2002 Annual Meeting;
2. To ratify the appointment by the Board of Directors of KPMG LLP,
certified public accountants, as independent auditors for the Company for
1999; and
3. To transact such other business as may properly come before the meeting
or any adjournment thereof.
Shareholders of record at the close of business on Monday, 7 June 1999 will
be entitled to vote at the Annual Meeting, whether in person or by proxy. Please
complete, sign, date, and return the enclosed proxy card as soon as possible in
the envelope provided. Shareholders who attend the Annual Meeting may revoke
their proxies and vote in person, if they wish to do so.
By Order of the Board of Directors
James A. Broderick
Secretary
601 Rayovac Drive
Madison, Wisconsin 53711
21 June 1999
IMPORTANT
ALL SHAREHOLDERS ARE CORDINALLY INVITED TO ATTEND THE ANNUAL MEETING.
WHETHER OR NOT YOU PLAN TO ATTEND IN PERSON, YOU ARE URGED TO COMPLETE, DATE AND
SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN THE ENVELOPE PROVIDED.
THIS WILL ASSURE YOUR REPRESENTATION AND A QUORUM FOR THE TRANSACTION OF
BUSINESS AT THE ANNUAL MEETING. IF YOU DO ATTEND THE ANNUAL MEETING, YOU MAY
VOTE IN PERSON, IF YOU DESIRE TO DO SO, EVEN IF YOU HAVE RETURNED A PROXY CARD.
<PAGE>
RAYOVAC CORPORATION
PROXY STATEMENT
Your proxy in the form enclosed is solicited by the Board of Directors of
Rayovac Corporation (the "Company"). Your proxy may be revoked by you at any
time prior to its use. Proxies may be revoked by (i) written notice filed with
the Secretary of the Company at or before the Annual Meeting or (ii) oral notice
given to the presiding officer during the Annual Meeting. The presence of a
shareholder at the Annual Meeting who has filed a proxy shall not of itself
constitute a revocation. Any written notice revoking a proxy should be sent to
James A. Broderick, Secretary, Rayovac Corporation, 601 Rayovac Drive, Madison,
Wisconsin 53711. The shares represented by the proxies received will be voted at
the Annual Meeting, or any adjournment thereof, in accordance with such
specifications as are made therein or, if no such specifications are made, in
accordance with the recommendations of the Board of Directors.
The cost of preparing and mailing this notice and statement and the enclosed
form of proxy will be borne by the Company. In addition to solicitation by mail,
proxies may be solicited in person or by telephone or telegraph by directors,
officers, and regular employees of the Company, without extra compensation and
at the Company's expense. The Company will also request bankers and brokers to
solicit proxies from their customers, where appropriate, and will reimburse them
for reasonable expenses. In addition, the Company has engaged Georgeson &
Company Inc., New York, New York, to assist in soliciting proxies for a fee of
approximately $6,000 plus reasonable out-of-pocket expenses.
The record date for the determination of shareholders entitled to vote at
the meeting is Monday, 7 June 1999. On the record date, there were outstanding
27,490,052 shares of the Company's Common Stock ("Common Stock"), constituting
all of the outstanding voting securities of the Company. Each share is entitled
to one vote. Abstentions and broker non-votes are counted for purposes of
determining the number of shares represented at the meeting but are deemed not
to have voted on any proposal. Directors are elected by a plurality of the votes
cast. The vote required for ratification of the independent auditors is a
majority of the shares voting.
The mailing address of the executive offices of the Company is 601 Rayovac
Drive, Madison, Wisconsin 53711. This Proxy Statement and the accompanying
Notice of Annual Meeting of Shareholders and proxy card are being mailed, on or
about 21 June 1999, to shareholders of record on the record date.
The Annual Report to Shareholders of the Company for the fiscal year ended
September 30, 1998, including the Company's financial statements for its 1998
fiscal year, was previously mailed to shareholders on 5 March 1999.
3
<PAGE>
ELECTION OF DIRECTORS
The Board of Directors currently consists of eight members, as determined in
accordance with the Company's Amended and Restated By-Laws. In accordance with
the Company's Amended and Restated Articles of Incorporation, the Board of
Directors is divided into three classes, designated Class I, Class II, and Class
III. There are two vacancies in Class I, whose terms will expire at the 2002
Annual Meeting. There is one vacancy in Class II, whose term will expire at the
2001 Annual Meeting. There is one vacancy in Class III, whose term will expire
at the 2000 Annual Meeting.
The names of the nominees being presented for consideration by the
shareholders, their ages, the years they have been directors of the Company,
their principal occupations over the past five years, their current positions
with the Company, and certain other directorships held by them are set forth
below. The shares represented by all proxies received will be voted for these
nominees, except to the extent authority to do so is withheld as provided for in
the enclosed proxy card. If any such nominee should be unable or unwilling to
serve, all proxies received will be voted for the person, if any, as shall be
designated by the Board of Directors to replace such nominee. The Board of
Directors has no reason to believe that any nominee will not be available to
serve as a director.
NOMINEES FOR VACANCIES ON THE BOARD OF DIRECTORS
Nominees for the vacancies in Class I, whose terms will expire at the 2002
Annual Meeting of Shareholders, are as follows:
<TABLE>
<S> <C>
David A. Jones............... Mr. Jones has served as the Chairman of the Board of
Age 49 Directors and Chief Executive Officer of the Company since
September 1996. From September 1996 to April 1998, Mr. Jones
also served as President of the Company. Between February
1995 and March 1996, Mr. Jones was Chief Operating Officer,
Chief Executive Officer and Chairman of the Board of
Directors of Thermoscan, Inc., a manufacturer and marketer
of infrared ear thermometers for consumer and professional
use. From 1989 to September 1994, he served as President and
Chief Executive Officer of The Regina Company, a
manufacturer of vacuum cleaners and other floor care
equipment. In addition, Mr. Jones serves as a director of
Ladd Furniture, Inc. Mr. Jones has over 25 years of
experience working in the consumer durables industry, most
recently in management of operations, manufacturing and
marketing.
Scott A. Schoen.............. Mr. Schoen has been a director of the Company since
Age 40 September 1996 and is a Managing Director of Thomas H. Lee
Co. ("THL Co."), which he joined in 1986. In addition, Mr.
Schoen is a Vice President of Thomas H. Lee Advisors I and
Thomas H. Lee Advisors II, a Trustee of THL Equity Trust
III, the general partner of THL Equity Advisors Limited
Partnership III, which is the general partner of Thomas H.
Lee Equity Fund III L.P., and a Managing Director and Member
of THL Equity Advisors IV, LLC, which is the general partner
of Thomas H. Lee Equity Fund IV, L.P. He is also a director
of Syratech Corporation, TransWestern Communications Corp.
and several private corporations.
</TABLE>
4
<PAGE>
The nominee for the vacancy in Class II, whose term will expire at the 2001
Annual Meeting of Shareholders, is as follows:
<TABLE>
<S> <C>
John S. Lupo................. Mr. Lupo has been a director of the Company since July 1998
Age 52 and has been Executive Vice President for sales and
marketing for Bassett Furniture Industries, Inc. since
October 1998. From April 1998 to October 1998, Mr. Lupo
served as a consultant in the consumer products industry.
Prior to that time and since August 1996, Mr. Lupo served as
Senior Vice President and Chief Operating Officer for the
International division of Walmart Stores, Inc. and from
October 1990 to August 1996, as Senior Vice
President--General Merchandise Manager of Walmart Stores,
Inc.
</TABLE>
The nominee for the vacancy in Class III, whose term will expire at the 2000
Annual Meeting of Shareholders, is as follows:
<TABLE>
<S> <C>
Joseph W. Deering............ Mr. Deering has been a director of the Company since July
Age 59 1998 and has been President for the food equipment group of
Premark International, Incorporated since 1992. Previously
Mr. Deering served as President for Leucadia Manufacturing
and President and Chief Executive Officer for Tomkins
Industries. Mr. Deering is also a director for both Quadlux
Inc. and Trion, Inc.
</TABLE>
DIRECTORS CONTINUING IN OFFICE
The directors continuing in office in Class II are as follows:
<TABLE>
<S> <C>
Roger F. Warren.............. Mr. Warren is a director of the Company and has served as
Age 58 President/International and Contract Micropower of the
Company since 1996. Mr. Warren joined the Company in 1985
and has held several positions including Executive Vice
President and General Manager and Senior Vice President and
General Manager/ International. Mr. Warren is also a
director of Bolder Technologies Corporation.
Thomas R. Shepherd........... Mr. Shepherd has been a director of the Company since
Age 69 September 1996. Mr. Shepherd is currently a Special Partner
of THL Co. and has been engaged as a consultant to THL Co.
since 1986. In addition, Mr. Shepherd is an Executive Vice
President of Thomas H. Lee Advisors I and an officer of
various other THL Co. affiliates. He is also a director of
General Nutrition Companies, Inc. and various private
corporations.
</TABLE>
The directors continuing in office in Class III are as follows:
<TABLE>
<S> <C>
Kent J. Hussey............... Mr. Hussey is a director of the Company and has served as
Age 53 President and Chief Operating Officer of the Company since
</TABLE>
5
<PAGE>
<TABLE>
<S> <C>
April 1998. Prior to that time and since joining the Company
in October 1996, Mr. Hussey was the Executive Vice President
of Finance and Administration, Chief Financial Officer and a
director of the Company. From 1994 to 1996, Mr. Hussey was
Vice President and Chief Financial Officer of ECC
International, a producer of industrial minerals and
specialty chemicals, and from 1991 to July 1994 he served as
Vice President and Chief Financial Officer of The Regina
Company.
Warren C. Smith, Jr.......... Mr. Smith has been a director of the Company since September
Age 42 1996 and has been employed by THL Co. since 1990 and
currently serves as a Managing Director of THL Co. In
addition, Mr. Smith is a Vice President of Thomas H. Lee
Advisor I and T.H. Lee Mezzanine II. Mr. Smith is also a
Managing Director and Member of THL Equity Advisors Limited
Partnership III, which is the general partner of Thomas H.
Lee Equity Fund III L.P. and a Managing Director and Member
of THL Equity Advisors IV, LLC, which is the general partner
of Thomas H. Lee Equity Fund IV, L.P. He is also a director
of Finlay Enterprises, Inc., Finlay Fine Jewelry Corporation
and various private corporations.
</TABLE>
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
In addition to the directors set forth above who are executive officers of
the Company, set forth below is certain information concerning non-director
employees who also serve as executive officers of the Company:
Stephen P. Shanesy, age 42, has been the Executive Vice President of Global
Brand Management of the Company since April 1998. Prior to that time and from
December 1997, Mr. Shanesy served as Senior Vice President of Marketing and the
General Manager of General Batteries and Lights of the Company. From December
1996 to January 1998, Mr. Shanesy was the Senior Vice President of Marketing and
the General Manager of General Batteries. From 1993 to 1996 Mr. Shanesy was Vice
President of Marketing of Oscar Mayer.
Kenneth V. Biller, age 50, has been the Senior Vice President of Operations
since August 1998. From January to August 1998 he was Senior Vice President of
Manufacturing/Supply Chain. Prior to that time and since 1996 he was the Senior
Vice President and General Manager of Lighting Products & Industrial and was
Vice President and General Manager of Lighting Products & Industrial since 1995.
Mr. Biller joined the Company in 1972 and has held several positions, including
Director of Technology/Battery Products and Vice President of Manufacturing.
Merrell M. Tomlin, age 47, has been Executive Vice President of Sales of the
Company since October 1998. Mr. Tomlin joined the Company in October 1996 as
Senior Vice President of Sales. From March 1996 to September 1996, Mr. Tomlin
served as Vice President of Sales of Braun of North America/ Thermoscan and from
August 1995 to March 1996, he served as Vice President of Sales of Thermoscan,
Inc. Prior to that time, Mr. Tomlin was Vice President of Sales of various
divisions of Casio Electronics.
Randall J. Steward, age 44, has been the Senior Vice President of Finance
and Chief Financial Officer of the Company since April 1998. Mr. Steward joined
the Company in March 1998 as Senior Vice
6
<PAGE>
President of Corporate Development. From October 1997 to March 1998, Mr. Steward
worked as an independent consultant, primarily with Thermoscan, Inc. and Braun
AG assisting with financial and operational issues. From March 1996 to September
1997, Mr. Steward served as President and General Manager of Thermoscan, Inc.
From January 1992 to March 1996, he served as Executive Vice President of
Finance and Administration and Chief Financial Officer of Thermoscan, Inc.
James A. Broderick, age 55, is Vice President, General Counsel and Secretary
of the Company and has held these positions since 1985.
BOARD ACTIONS;
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors of the Company held four regular meetings, one
special meeting, and acted by unanimous written consent approximately four times
during 1998.
The Board of Directors has designated two principal standing committees, the
Audit Committee and the Compensation Committee. The function of these committees
and the number of meetings held in 1998 are described below.
The Audit Committee, whose current members are Scott A. Schoen, Warren C.
Smith, Jr., and Thomas R. Shepherd, met once in fiscal 1998. The Committee's
duties are to (1) review with management and the independent auditors the
Company's accounting policies and practices and the adequacy of internal
controls; (2) review the scope and results of the annual examination performed
by the independent auditors; and (3) make recommendations to the Board of
Directors regarding the appointment of the independent auditors and approval of
the services performed by the independent auditors, and fees related thereto.
The Compensation Committee, whose current members are Warren C. Smith, Jr.,
Scott A. Schoen, and Thomas R. Shepherd, met three times in fiscal 1998. The
Committee is responsible for establishing the Company's executive officer
compensation policies and for the administration of those policies.
7
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The table below contains certain information with respect to the only
beneficial owners known to the Company as of 7 June 1999 of more than 5% of the
outstanding shares of Common Stock.
<TABLE>
<CAPTION>
SHARES OF COMMON
STOCK BENEFICIALLY
OWNED(1)
-----------------------
NUMBER PERCENTAGE
NAMES AND ADDRESSES OF SHARES OF CLASS
- ----------------------------------------------------------------------------------------- ---------- -----------
<S> <C> <C>
Thomas H. Lee Equity Fund III, L.P.(2)
75 State Street, Ste. 2600
Boston, MA 02109....................................................................... 9,928,579 36.1%
FMR Corp.(3)
82 Devonshire St.
Boston, MA 02109-3614.................................................................. 3,347,700 12.2
State of Wisconsin Investment Board(4)
121 E. Wilson St., P.O. Box 7842
Madison, WI 53707...................................................................... 1,996,600 7.3
</TABLE>
- ------------------------
(1) Unless otherwise noted, the nature of beneficial ownership is sole voting
and/or investment power, except to the extent authority is shared by spouses
under applicable law. Shares of Common Stock not outstanding but deemed
beneficially owned by virtue of the right of a person or group to acquire
them within 60 days are treated as outstanding only for purposes of
determining the number and percent of outstanding shares of Common Stock
owned by such person or group.
(2) THL Equity Advisors III Limited Partnership ("Advisors"), the general
partner of the THL Fund and Thomas H. Lee Foreign Fund III, L.P., THL Equity
Trust III ("Equity Trust"), the general partner of Advisors, Thomas H. Lee,
Scott A. Schoen, Warren C. Smith, Jr. and other managing directors of THL
Co., as Trustees of Equity Trust, and Thomas H. Lee as sole shareholder of
Equity Trust, may be deemed to be beneficial owners of the shares of Common
Stock held by such Funds. Each of such persons maintains a principal
business address at Suite 2600, 75 State Street, Boston, MA 02109. Each of
such persons disclaims beneficial ownership of all shares.
(3) FMR Corp. and related persons and entities reported on a Schedule 13G filed
on February 1, 1999 that they were the beneficial owners of 3,347,700 shares
of the Company's Common Stock. This report indicates that FMR Corp. has the
sole or shared power to vote or direct the vote for none of such shares and
sole investment power for all 3,347,700 shares.
(4) State of Wisconsin Investment Board reported on a Schedule 13G filed on
February 1, 1999 that it was the beneficial owner of 1,996,600 shares of the
Company's Common Stock. This report indicates that State of Wisconsin
Investment Board has the sole power to vote and sole investment power for
all 1,996,600 shares.
8
<PAGE>
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS
The following table sets forth as of 7 June 1999 (except as set forth in the
footnotes herein) information with respect to beneficial ownership of Common
Stock by each director and Named Executive Officer (as defined herein) based on
Securities and Exchange Commission filings and other available information and
by all directors and executive officers of the Company as a group.
<TABLE>
<CAPTION>
SHARES OF COMMON STOCK
BENEFICIALLY OWNED (2)
-------------------------
NUMBER PERCENTAGE
NAMES OF SHARES OF CLASS
- ---------------------------------------------------------------------------------------- ------------ -----------
<S> <C> <C>
David A. Jones(1)....................................................................... 418,824 1.5
Kent J. Hussey(2)....................................................................... 148,586 *
Roger F. Warren(3)...................................................................... 428,902 1.6
Stephen P. Shanesy(4)................................................................... 75,381 *
Trygve Lonnebotn(5)..................................................................... 271,190 *
Scott A. Schoen(6)(7)................................................................... 50,036 *
Thomas R. Shepherd(7)................................................................... 26,061 *
Warren C. Smith, Jr.(6)(7).............................................................. 41,703 *
Joseph W. Deering(8).................................................................... 2,000 *
John S. Lupo(9)......................................................................... 2,000 *
All directors and executive officers of the Company as a group
(10 persons)(6)(7).................................................................... 1,464,683 5.3%
</TABLE>
- ------------------------
* Less than 1%
(1) Includes 364,630 shares subject to options which are currently exercisable.
Shares of Common Stock beneficially owned prior to the offerings include
2,957 shares representing Mr. Jones' proportional interest in the THL Fund.
Mr. Jones disclaims beneficial ownership of these shares.
(2) Includes 106,343 shares subject to options which are currently exercisable.
(3) Includes 91,158 shares subject to options which are currently exercisable.
(4) Includes 55,578 shares subject to options which are currently exercisable.
(5) Includes 28,368 shares subject to options which are currently exercisable.
(6) THL Equity Advisors III Limited Partnership ("Advisors"), the general
partner of the THL Fund and Thomas H. Lee Foreign Fund III, L.P., THL Equity
Trust III ("Equity Trust"), the general partner of Advisors, Thomas H. Lee,
Scott A. Schoen, Warren C. Smith, Jr. and other managing directors of THL
Co., as Trustees of Equity Trust, and Thomas H. Lee as sole shareholder of
Equity Trust, may be deemed to be beneficial owners of the shares of Common
Stock held by such Funds. Each of such persons maintains a principal
business address at Suite 2600, 75 State Street, Boston, MA 02109. Each of
such persons disclaims beneficial ownership of all shares.
(7) Represents the proportional interest of such individual in THL-CCI Limited
Partnership; in the case of Mr. Smith, also includes 9,786 shares which Mr.
Smith may be deemed to beneficially own as a result of Mr. Smith's
children's proportional beneficial interest in THL-CCI Limited Partnership.
(8) Represents shares subject to options which are currently exercisable.
(9) Represents shares subject to options which are currently exercisable.
9
<PAGE>
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended requires
the Company's directors, officers and persons who own more than 10% of a
registered class of the Company's equity securities to file reports of ownership
and changes in ownership with the Securities and Exchange Commission. Based
solely upon review of Forms 3, 4 and 5 (and amendments thereto) furnished to the
Company during or in respect of the fiscal year ended September 30, 1998, the
Company is not aware of any director or executive officer who has not timely
filed reports required by Section 16(a) of the Exchange Act during or in respect
of such fiscal year, except Randall J. Steward who filed one late Form 3, and
David A. Jones, who filed one late Form 4 covering two sales of securities of
the Company.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
The following table sets forth compensation paid to the Chief Executive
Officer of the Company and the other four most highly compensated executive
officers of the Company during fiscal 1998, fiscal 1997 and the three month
Transition Period ended September 30, 1996 (the "Named Executive Officers") for
services rendered in all capacities to the Company.
<TABLE>
<CAPTION>
OTHER SECURITIES
ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION FISCAL YEAR SALARY ($) BONUS ($) COMPENSATION ($) OPTIONS (#) COMPENSATION ($)
- ------------------------------ ----------------- ---------- --------- ---------------- ----------- ----------------
<S> <C> <C> <C> <C> <C> <C>
David A. Jones,............... 1998 $465,000 $250,000 $ 168,900(1) $ 71,500(2)
Chairman of the Board and 1997 400,000 218,500 65,800 84,204
Chief Executive Officer Transition Period 19,700 179,500 911,577
Kent J. Hussey,............... 1998 304,600 162,500 72,106 $ 475,800(3)
President and Chief 1997 275,000 185,000 253,756
Operating Officer
Roger F. Warren,.............. 1998 270,000 108,000
President/International and 1997 258,000 103,200 28,569
Contract Micropower Transition Period 64,500 24,700 227,894 486,600(4)
Trygve-Lonnebotn,(5).......... 1998 251,000 100,400
Executive Vice President of 1997 240,200 96,100 24,074
Operations Transition Period 60,100 32,400 170,921 377,800(4)
Stephen P. Shanesy,........... 1998 235,000 94,000
Executive Vice President of 1997 154,900 140,000 137,024
Global Brand Management
</TABLE>
- ------------------------------
(1) Includes approximately $70,000 related to interest on the Executive Note (as
defined herein) and $48,000 related to a Company provided condominium.
(2) Represents relocation payments.
(3) Represents relocation payments and compensation from the exercise of stock
options.
(4) Represents amounts paid by the Company in connection with the
Recapitalization (as defined herein).
(5) Mr. Lonnebotn retired from his position with the Company on 31 March 1999.
OPTION GRANTS AND EXERCISES
In connection with the recapitalization of the Company in September 1996
(the "Recapitalization"), the Board adopted the Rayovac Corporation 1996 Stock
Option Plan (the "1996 Plan"). Pursuant to the 1996 Plan, options may be granted
with respect to an aggregate of 3,000,000 shares of Common Stock. At September
30, 1998 an aggregate of 2,199,209 options to purchase shares of Common Stock at
a weighted average exercise price of $4.90 per share, 911,577 of which have been
granted to David A. Jones in
10
<PAGE>
accordance with the terms of his employment agreement were outstanding. See
"--Employment Agreements." Pursuant to the Rayovac Corporation 1997 Stock Option
Plan (the "1997 Plan"), options to purchase an aggregate of 556,222 shares of
Common Stock were granted to certain management employees, which options were
immediately exercised or surrendered to the Company's Deferred Compensation Plan
as of such date.
The following table discloses the grants of stock options during fiscal 1998
to the Named Executive Officers.
OPTION/SAR GRANTS IN FISCAL 1998
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
-------------------------------------------------------------- ANNUAL RATES OF
NUMBER OF PERCENT OF TOTAL STOCK PRICE
SECURITIES OPTIONS/SARS EXERCISE APPRECIATION
UNDERLYING GRANTED TO OR BASE FOR OPTION TERM
OPTIONS/SARS EMPLOYEES IN PRICE --------------------------
NAME GRANTED (#) FISCAL YEAR ($/SHARE) EXPIRATION DATE 5% ($) 10% ($)
- ----------------------------------- ------------- ----------------- ----------- --------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Kent J. Hussey..................... 72,106 16.3 $ 22.88 04/27/2008 $ 1,037,541 $ 2,614,371
</TABLE>
The following table sets forth information concerning options to purchase
Common Stock held by the Named Executive Officers.
AGGREGATED OPTION EXERCISES IN FISCAL 1998 AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT OPTIONS AT
ACQUIRED VALUE FISCAL YEAR END (#) FISCAL YEAR END ($)(1)
NAME ON EXERCISE REALIZED $ (EXERCISABLE/UNEXERCISABLE) (EXERCISABLE/UNEXERCISABLE)
- ----------------------------------- ----------- ---------- ------------------------- -------------------------
<S> <C> <C> <C> <C>
David A. Jones..................... 0 $ -0- 364,630/546,947 $ 4,643,563/6,965,370
Roger F. Warren.................... 0 -0- 91,158/136,736 1,160,897/1,741,333
Trygve Lonnebotn................... 0 -0- 68,368/2,553 870,666/32,512
Kent J. Hussey..................... 34,141 417,715 57,017/208,842 726,111/1,741,333
Stephen P. Shanesy................. 0 -0- 45,579/68,368 580,449/870,666
</TABLE>
- ------------------------
(1) These values are calculated using the $17 1/8 per share closing price of the
Common Stock as quoted on the NYSE on September 30, 1998.
DIRECTOR COMPENSATION
Directors who are employees of the Company receive no compensation for
serving on the Board of Directors. Non-employee directors of the Company are
reimbursed for their out-of-pocket expenses in attending meetings of the Board
of Directors. Messrs. Lupo and Deering receive $5,000 per quarterly meeting in
their capacities as directors. Messrs. Schoen, Shepherd and Smith receive no
fees in their capacities as directors. See "Compensation Committee Interlocks
and Insider Participation" for a description of certain other arrangements
pursuant to which THL Co., of which Messrs. Schoen and Smith are managing
directors and Mr. Shepherd is a special partner, receive compensation from the
Company.
11
<PAGE>
EMPLOYMENT AGREEMENTS
On April 27, 1998 the Company entered into an amended and restated
employment agreement with David A. Jones (the "Jones Employment Agreement") and
an employment agreement (as amended, the "Hussey Employment Agreement" and
together with the Jones Employment Agreement, the "Executive Employment
Agreements") with Kent J. Hussey (together with Mr. Jones, the "Executives").
Under their respective employment agreements, Mr. Jones is entitled to a base
salary of $500,000 per annum and Mr. Hussey is entitled to a base salary of
$325,000 per annum (such base salaries may be increased from time to time at the
discretion of the Board of Directors) and each Executive is entitled to an
annual bonus based upon the Company achieving certain annual performance goals
established by the Board of Directors. Each Executive Employment Agreement has a
term of three years expiring on April 30, 2001, and the Hussey Employment
Agreement provides for automatic renewal for successive one year periods unless
terminated earlier upon 90 days prior written notice by either Mr. Hussey or the
Company. At any time each of the Executives has the right to resign and
terminate their respective Executive Employment Agreement upon 60 days notice.
Upon such resignation, the Company must pay to the resigning Executive any
unpaid base salary. The Executive Employment Agreements provide that, upon
termination of the Executive's employment for death or disability, the Company
will pay to the terminated Executive or such Executive's estate any unpaid base
salary, any accrued but unpaid bonus through the date of termination and a pro
rata portion of the bonus for such period, the Executive's base salary for a
period of 12 months in the case of Mr. Jones or 24 months in the case of Mr.
Hussey, and any other benefits until the earlier of the end of the term of the
agreement or 12 months in the case of Mr. Jones, or 24 months for Mr. Hussey, in
either case from the date of termination. In addition, the Jones Employment
Agreement also provides that Mr. Jones shall receive any additional salary due
until the earlier of the end of the term or 12 months from the date of
termination upon Mr. Jones' termination for death or disability. The Company has
the right to terminate employment for "cause" (as defined) and shall be
obligated to pay to the terminated Executive any unpaid base salary accrued
through the date of termination. In the event the Executive is terminated
without cause (as defined), the Company must pay to him any unpaid base salary,
any accrued but unpaid bonus through the date of termination and the Executive's
base salary, other benefits, and, in the case of Mr. Jones only, any additional
salary, until the earlier of the end of the term of the agreement or 12 months
in the case of Mr. Jones, or 24 months in the case of Mr. Hussey, in either case
from the date of termination.
The Executive Employment Agreements also provide that, during the term of
the agreement or the period of time served as a director, and for one year
thereafter for Mr. Jones, and for two years thereafter for Mr. Hussey, the
Executive shall not engage in or have any business which is involved in the
industries in which the Company is engaged. The Company has also granted to
Messrs. Jones and Hussey options to purchase, respectively, 911,577 and 227,894
shares of Common Stock at $4.39 per share (the market value on date of grant) of
which Mr. Hussey has exercised options to purchase 34,141 shares of Common
Stock. In addition, the Company has granted to Mr. Hussey options to purchase
72,106 shares of Common Stock at $22.88 per share (the market value on date of
grant). In each case, half of such options become exercisable at a rate of 20%
per year over a five-year period and the other half of which become exercisable
at the end of ten years with accelerated vesting over each of the next five
years if the Company achieves certain performance goals.
In connection with the Recapitalization, Mr. Jones individually also
purchased 227,895 shares of Common Stock at approximately $4.39 per share.
One-half of the purchase price was paid in cash and one-half with a promissory
note (the "Executive Note"). The Company holds the Executive Note in the
12
<PAGE>
principal amount of $500,000 from Mr. Jones in connection with the purchase of
shares of Common Stock. Mr. Jones will receive additional salary at an initial
rate of $35,000 annually as long as the promissory note remains outstanding.
SEVERANCE AGREEMENTS
Each of Roger F. Warren, President/International and Contract Micropower and
Stephen P. Shanesy, Executive Vice President of Global Brand Management, has
entered into a severance agreement (each, a "Severance Agreement") with the
Company pursuant to which, in the event that his employment is terminated during
the term of the Severance Agreement (a) by the Company without cause (as
defined) or (b) by reason of death or disability (as defined), the Company shall
pay him an amount in cash equal to two (2) times the sum of (i) his base salary
as in effect for the fiscal year ending immediately prior to the fiscal year in
which such termination occurs and (ii) the annual bonus (if any) earned by him
pursuant to any annual bonus or incentive plan maintained by the Company in
respect of the fiscal year ending immediately prior to the fiscal year in which
such termination occurs, such amount to be paid ratably monthly in arrears over
the remaining term of the Severance Agreement. In the event of such termination,
the Company shall also maintain for the twelve-month period following such
termination insurance benefits for such individual and his dependents similar to
those provided immediately prior to such termination. Under the Severance
Agreements, each of Messrs. Warren and Shanesy has agreed that for two years
following the later of the end of the term of the Severance Agreement or the
date of termination, that he will not engage or have a financial interest in any
business which is involved in the industries in which the Company is engaged.
The initial term of each Severance Agreement is one year with automatic one-year
renewals thereafter, subject to thirty days notice of non-renewals prior to the
end of the then current term.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1998, the Compensation Committee of the Board of Directors was
composed of Scott A. Schoen, Thomas R. Shepherd and Warren C. Smith, Jr.
The Company and THL Co. (which together with its affiliates owns 42.2% of
the outstanding Common Stock) are parties to a Management Agreement entered into
in connection with the Recapitalization pursuant to which the Company has
engaged THL Co. to provide consulting and management advisory services for an
initial period of five years through September 12, 2001. Under the Management
Agreement and in connection with the closing of the Recapitalization, the
Company paid THL Co. and an affiliate an aggregate fee of $3.25 million (the
"THL Transaction Fee"). In consideration of the consulting and management
advisory services, the Company pays THL Co. and its affiliate an aggregate
annual fee of $360,000 plus expenses (the "Management Fee"). The Company
believes that this Management Agreement is on terms no less favorable to the
Company than could have been obtained from an independent third party.
In connection with the Recapitalization, Thomas H. Lee Equity Fund III and
certain other affiliates of THL Co. (together, the "Lee Group"), certain other
shareholders of the Company and the Company entered into the Shareholders
Agreement. The Shareholders Agreement provides for certain restrictions on
transfer of the shares beneficially owned by the parties thereto. Additionally,
the Shareholders Agreement provides that, subject to certain limitations, so
long as the Lee Group and their permitted transferees own at least 10% of the
shares of Common Stock acquired in the Recapitalization, the Lee Group shall
have "demand" registrations with respect to their shares of Common Stock. The
shareholders
13
<PAGE>
party to the Shareholders Agreement, including the Lee Group, are also entitled,
subject to certain limitations, to include shares of Common Stock held by them
in other registrations of equity securities of the Company initiated by the
Company for its own account or pursuant to a request for registration by the Lee
Group.
COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
COMPENSATION PROCEDURES AND POLICIES
The Compensation Committee determines the compensation of all of the
executive officers of the Company. Decisions by the Compensation Committee
relating to stock options are reviewed and approved by the full Board of
Directors.
The Company's executive compensation philosophy and specific compensation
plans tie a significant portion of executive compensation to the Company's
success in meeting specified profit, growth, and performance goals and to
appreciation in the Company's stock price. The Company's compensation objectives
include attracting and retaining the best possible executive talent, motivating
executive officers to achieve the Company's performance objectives, rewarding
individual performance and contributions, and linking executive and shareholder
interest through equity based plans.
The Company's executive compensation consists of three key components: base
salary, annual incentive compensation, and stock options, each of which is
intended to complement the others and, taken together, to satisfy the Company's
compensation objectives. The Compensation Committee's policies with respect to
each of the three components, including the basis for the compensation awarded
to David A. Jones, as the Company's Chief Executive Officer, are discussed
below.
BASE SALARY
In the early part of each fiscal year, the Compensation Committee reviews
the base salary of the Company's Chief Executive Officer and the recommendation
of the Chief Executive Officer with regard to the base salary of the Chief
Operating Officer and all other executive officers of the Company. The
Compensation Committee then approves, with any modifications it deems
appropriate, annual base salaries for each of the executive officers.
Recommended base salaries of the executive officers are based upon the base
salary ranges recommended annually by the Chief Executive Officer of the
Company. The Compensation Committee reviews available national survey data
regarding salaries of persons holding comparable positions at comparably sized
consumer goods companies to establish base salary ranges.
The base salary of Mr. Jones was reviewed at the April 1998 meeting of the
Compensation Committee. In setting Mr. Jones' salary for 1999, the Compensation
Committee considered the Company's achievement of its annual goals relating to
earnings per share, sales growth, and return on investment in fiscal 1998. In
evaluating Mr. Jones' performance, the Compensation Committee primarily
considered these Company financial goals and noted that the value of the
Company's equity had increased by more than $400 million since Mr. Jones became
Chief Executive Officer in September 1996. In consideration of these factors,
the Compensation Committee approved an increase in Mr. Jones' base salary of
$100,000, or 25%, for fiscal 1999.
14
<PAGE>
ANNUAL INCENTIVE COMPENSATION
The Company's executive officers are entitled to participate in an incentive
bonus plan that provides for the payment of cash bonuses based on the Company's
achievement of its financial goals. The Company's goal for fiscal 1998 was based
upon the level of earnings before interest, tax, depreciation, and amortization
("EBITDA"). Since the Company achieved its EBITDA goal for fiscal 1998, awards
were paid out at 100% of the target bonus amount. Based on these results, Mr.
Jones was awarded a bonus of $250,000 for fiscal 1998.
The senior vice presidents and executive vice presidents are entitled to
participate in the annual incentive bonus plan, which calls for payment of 40%
of their annual salaries in the event that the Company reaches 100% of its
target financial goal. Bonuses can exceed that amount if the Company exceeds its
financial performance target. Based on the Company's EBITDA in fiscal 1998, the
Company awarded bonuses at 100% of the target levels for all participants in the
bonus plan.
STOCK OPTIONS
The Company's executive officers are also entitled to participate in the
Rayovac Corporation 1996 Stock Option Plan (the "1996 Plan") and are eligible to
participate in the 1997 Rayovac Incentive Plan (the "Incentive Plan").
Under the 1996 Plan, stock options to acquire up to 3,000,000 shares of
Common Stock, in the aggregate, may be granted to select employees and directors
of the Company under either or both a time-vesting or a performance-vesting
formula at an exercise price equal to the market price of the Common Stock on
the date of grant. The time-vesting options become exercisable primarily in
equal 20% increments over a five year period. The performance-vesting options
become exercisable at the end of ten years with accelerated vesting over each of
the next five years if the Company achieves certain performance goals.
Accelerated vesting may also occur upon a sale of the Company, as defined in the
1996 Plan. As of September 30, 1998, options with respect to 2,199,209 shares of
Common Stock were outstanding under the 1996 Plan.
In 1997, the Board adopted the Incentive Plan. The Incentive Plan replaces
the 1996 Plan and no further awards will be granted under the 1996 Plan, other
than awards of options for shares up to an amount equal to the number of shares
covered by options that terminate or expire prior to being exercised. Under the
Incentive Plan, the Company may grant to employees and non-employee directors
stock options, stock appreciation rights, restricted stock, and other
stock-based awards, as well as cash-based annual and long-term incentive awards.
Accelerated vesting will occur in the event of a change in control, as defined
in the Incentive Plan. Up to 3,000,000 shares of Common Stock may be issued
under the Incentive Plan. The Incentive Plan expires in August 2007. As of
September 30, 1998, options with respect to 362,000 shares of Common Stock were
outstanding under the Incentive Plan.
The options awarded to the various executive officers are shown in the table
on page 11.
COMPENSATION COMMITTEE
Scott A. Schoen
Thomas R. Shepherd
Warren C. Smith, Jr.
15
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company and THL Co. (which together with its affiliates owns 42.2% of
the outstanding Common Stock) are parties to a Management Agreement entered into
in connection with the Recapitalization pursuant to which the Company has
engaged THL Co. to provide consulting and management advisory services for an
initial period of five years through September 12, 2001. Under the Management
Agreement and in connection with the closing of the Recapitalization, the
Company paid THL Co. and an affiliate a transaction fee. In consideration of the
consulting and management advisory services, the Company pays THL Co. and its
affiliate a management fee. The Company believes that this Management Agreement
is on terms no less favorable to the Company than could have been obtained from
an independent third party.
The Company and David A. Jones are parties to the Jones Employment Agreement
pursuant to which Mr. Jones agreed to be the Chairman of the Board of Directors
and Chief Executive Officer of the Company. Mr. Jones also purchased from the
Company 227,895 shares of Common Stock with cash and a $500,000 promissory note
held by the Company with interest payable at a rate of 7% per annum and
principal payable on the earliest of the following to occur: (i) the fifth
anniversary of the note; (ii) the date on which (a) Mr. Jones terminates his
employment for any reason other than a Constructive Termination (as defined in
the Jones Employment Agreement) and (b) he is no longer a director of the
Company or (iii) the date the Company terminates Mr. Jones' employment for Cause
(as defined in the Jones Employment Agreement). Proceeds from any sale of Mr.
Jones' shares must be used to immediately prepay, in whole or in part the
principal amount of the promissory note outstanding and any accrued and unpaid
interest on the portion prepaid or the holder of the promissory note may declare
the entire principal amount of such note to be immediately due and payable. Mr.
Jones receives additional salary at an initial rate of $35,000 annually during
the period the promissory note is outstanding. In addition, the Company and Kent
J. Hussey are parties to the Hussey Employment Agreement pursuant to which Mr.
Hussey agreed to be President and Chief Operating Officer of the Company. See
"--Employment Agreements."
The Company holds five year promissory notes dated March 17, 1997 from
Messrs. Hussey, Tomlin and Shanesy, in principal amounts of $75,000, $60,000 and
$80,000, respectively, with interest payable at 8% per annum. Such notes were
incurred in connection with the purchase of shares of Common Stock by Messrs.
Hussey, Tomlin and Shanesy upon joining the Company. Mr. Hussey paid the
principal amount of his promissory note in fiscal 1998.
Pursuant to the 1997 Plan, on August 1, 1997, certain executive officers of
the Company, including Messrs. Jones, Hussey, and Shanesy, exercised options to
purchase shares of Common Stock under the 1997 Plan with five-year promissory
notes held by the Company, in principal amounts of $250,000, $50,000, and
$20,000, respectively, with interest payable at 8% per annum. On September 15,
1997, certain other executive officers, including Messrs. Warren, Lonnebotn,
Shanesy and Hussey, exercised options under the 1997 Plan with, in the case of
Messrs. Warren, Lonnebotn and Shanesy five-year promissory notes held by the
Company in principal amounts of $50,003, $46,079 and $30,002, respectively, with
interest payable at 8% per annum and in the case of Mr. Hussey, a non-interest
bearing promissory note in the principal amount of $36,000 held by the Company
of which no principal amount remains outstanding. Messrs. Jones, Hussey, Warren
and Lonnebotn paid the principal amounts of their August and September notes in
fiscal 1998.
In connection with the Recapitalization, the Lee Group, certain other
shareholders of the Company and the Company entered into the Shareholders
Agreement. The Shareholders Agreement provides for
16
<PAGE>
certain restrictions on transfer of the shares beneficially owned by the parties
thereto. Additionally, the Shareholders Agreement provides that, subject to
certain limitations, so long as the Lee Group and their permitted transferees
own at least 10% of the shares of Common Stock acquired in the Recapitalization
the Lee Group shall have "demand" registrations. The shareholders party to the
Shareholders Agreement, including the Lee Group, are also entitled, subject to
certain limitations, to include shares of Common Stock held by them in other
registrations of equity securities of the Company initiated by the Company for
its own account or pursuant to a request for registration by the Lee Group.
COMPARISON OF 10 MONTH CUMULATIVE TOTAL RETURN*
AMONG RAYOVAC CORPORATION, THE S&P SMALLCAP 600 INDEX
THE RUSSELL 2000 INDEX AND THE RUSSELL 2000 CONSUMER STAPLES INDEX
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURN
<S> <C> <C> <C> <C> <C>
11/20/97 12-97 3-98 6-98 9-98
RAYOVAC CORPORATION 100 138 168 162 122
S&P SMALLCAP 600 100 101 112 107 88
RUSSELL 2000 100 101 111 108 86
RUSSELL 2000 CONSUMER STAPLES 100 107 116 109 94
</TABLE>
<TABLE>
<CAPTION>
BEGINNING
TRANSACTION CLOSING NO. OF DIVIDEND DIVIDEND SHARES ENDING CUM. TOT.
DATE* TYPE PRICE** SHARES*** PER SHARE PAID REINVESTED SHARES RETURN
- --------- ----------- --------- ------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
11/20/97 Begin 14.000 7.14 7.143 100.00
12/31/97 Q'tr End 19.250 7.14 7.143 137.50
3/31/98 Q'tr End 23.563 7.14 7.143 168.30
6/30/98 Q'tr End 22.688 7.14 7.143 162.05
9/30/98 End 17.125 7.14 7.143 122.32
</TABLE>
* Specified ending dates or ex-dividend dates.
** All Closing Prices and Dividends are adjusted for stock splits and stock
dividends.
*** 'Begin Shares' based on $100 investment.
17
<PAGE>
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
KPMG LLP ("KPMG") currently serves as the Company's independent auditors.
They have served in that capacity since 30 September 1996. KPMG examined the
accounts of the Company and its subsidiaries and also provided other services to
the Company in connection with Securities and Exchange Commission filings.
Upon recommendation of the Audit Committee, the Board of Directors has
appointed KPMG as the independent auditors of the Company for fiscal 1999. The
shareholders are asked to ratify this action of the Board.
It is anticipated that one or more representatives of KPMG will be present
at the Annual Meeting with an opportunity to make a statement, if desired, and
will be available to answer appropriate questions from shareholders who are
present.
The shares represented by all proxies received will be voted for the
ratification of the selection of KPMG as the Company's independent auditors,
except to the extent authority to do so is withheld as provided for in the
enclosed proxy card.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
In June 1997, KPMG replaced Coopers & Lybrand L.L.P. (now
PricewaterhouseCoopers LLP) as the Company's independent accountants. The
decision to engage KPMG was made with the approval of the Company's Audit
Committee.
The Company believes, and it has been advised by Coopers & Lybrand L.L.P.
that it concurs in such belief, that, during the period of its engagement, the
Company and Coopers & Lybrand L.L.P. did not have any disagreement on any matter
of accounting principles or practices, financial statement disclosure or
auditing scope or procedure, which disagreement, if not resolved to the
satisfaction of Coopers & Lybrand L.L.P., would have caused it to make reference
in connection with its report on the Company's financial statements to the
subject matter of the disagreement.
OTHER MATTERS
The Board of Directors knows of no other items of business to be brought
before the meeting other than as set forth above. If any other items of business
should properly come before the Annual Meeting, it is the intention of the
persons named in the enclosed proxy card to vote such proxies in accordance with
their best judgment with respect to any such items. Discretionary authority for
them to do so is contained in the enclosed proxy card.
SHAREHOLDER PROPOSALS
Under the rules and regulations of the Securities and Exchange Commission,
shareholder proposals intended to be presented in the Company's Proxy Statement
for the 2000 Annual Meeting of Shareholders must be received at the principal
executive offices of the Company, 601 Rayovac Drive, Madison, Wisconsin 53711,
no later than 22 February 2000 in order to be considered for inclusion in the
Company's Proxy Statement for such Meeting.
Under the Company's By-Laws, proposals of shareholders intended to be
submitted for a formal vote (other than proposals to be included in the
Company's Proxy Statement) at the 2000 Annual Meeting of
18
<PAGE>
Shareholders may be made only by a shareholder of record who has given notice of
the proposal to the Secretary of the Company at its principal executive offices
no earlier than 8 May 2000 and not later than 2 June 2000. The notice must
contain certain information as specified in the By-Laws. Any such proposal
received after 2 June 2000 will not be considered "timely" under the federal
proxy rules for purposes of determining whether the Company may use
discretionary authority to vote on such proposal.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FILED WITH THE SECURITIES
AND EXCHANGE COMMISSION IS AVAILABLE ON REQUEST BY WRITING TO THE CORPORATE
COMMUNICATIONS DEPARTMENT, RAYOVAC CORPORATION, 601 RAYOVAC DRIVE, MADISON,
WISCONSIN 53711.
By Order of the Board of Directors
James A. Broderick
Secretary
21 June 1999
19
<PAGE>
PLEASE DETACH PROXY CARD HERE
- ------------------------------------------------------------------------------
RAYOVAC CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
JULY 22, 1999
P The undersigned, having read the Notice of Annual Meeting of Shareholders
R and Proxy Statement dated June 21, 1999, receipt of which is hereby
O acknowledged, does hereby appoint and constitute KENT J. HUSSEY and
X JAMES A. BRODERICK, and each or any of them, the attorneys and proxies
Y of the undersigned to vote and act at the Annual Meeting of Shareholders
of Rayovac Corporation to be held at the Company's headquarters,
601 Rayovac Drive, Madison, Wisconsin, on Thursday, July 22, 1999
at 8:00 a.m. and at any postponement or adjournment thereof, with
respect to all shares of Common Stock, par value $.01 per share, of
the Company, standing in the name of the undersigned or with respect
to which the undersigned is entitled to vote or act, with all the
powers that the undersigned would possess if personally present and
acting, as follows:
(IMPORTANT--TO BE SIGNED AND DATED ON REVERSE SIDE)
<PAGE>
PLEASE DETACH PROXY CARD HERE
- ------------------------------------------------------------------------------
[X] Please mark votes
as in this example.
This proxy, when properly executed, will be voted in the manner directed
below. If no direction is made, this proxy will be voted as the Board of
Directors recommends.
- ------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS 1 AND 2.
- ------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
1. (a) To elect David A. Jones and Scott A. 2. To ratify the FOR AGAINST ABSTAIN
Schoen as Class I Directors for a three- FOR all nominees WITHHOLD appointment by the [ ] [ ] [ ]
year term, (b) to select John S. Lupo as listed above AUTHORITY Board of Directors
a Class II Director for a two-year term (except as marked to vote for of KPMG LLP as
and (c) to elect Joseph W. Deering as a to the contrary) all nominees the Company's
Class III Director for a one-year term. listed above independent
If any such nominees should be unavailable, [ ] [ ] accountants for
the proxies or any of them may vote for 1999.
substitute nominee(s) at their discretion. 3. To transaction such
other business
(INSTRUCTION: To withhold authority to as may properly
vote for one or more individual nominees, come before the
write the nominee's name in the space meeting and any
provided below.) postponement or
adjournment
thereof.
DATE:___________________, 1999
______________________________
______________________________
SIGNATURE(S)
IMPORTANT: Please sign
exactly as your name appears
hereon. When signing as attorney,
executor, administrator, trustee,
guardian, etc., give title as
such. If joint account,
each joint owner should
sign.
</TABLE>
