<PAGE> 1
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 240.14a-11(c) or 240.14a-12
COLUMBIA SPORTSWEAR COMPANY
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(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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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[ ] 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
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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COLUMBIA SPORTSWEAR COMPANY
------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MAY 25, 2000
To the Shareholders of Columbia Sportswear Company:
The annual meeting of the shareholders of Columbia Sportswear Company, an
Oregon corporation, will be held at 2:00 p.m., Pacific Time, on Thursday, May
25, 2000, at the Multnomah Athletic Club at 1849 SW Salmon, Portland, Oregon for
the following purposes:
1. Electing seven directors to serve for the following year and until their
successors are elected; and
2. Transacting any other business that properly comes before the meeting.
Only shareholders of record at the close of business on April 14, 2000 will
be entitled to vote at the annual meeting.
You are requested to date and sign the enclosed proxy and return it in the
postage-prepaid envelope enclosed for that purpose. You may attend the meeting
in person even if you send in your proxy; retention of the proxy is not
necessary for admission to or identification at the meeting.
By Order of the Board of Directors
Timothy P. Boyle
President and Chief Executive Officer
Portland, Oregon
April 28, 2000
<PAGE> 3
COLUMBIA SPORTSWEAR COMPANY
------------------------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
The enclosed proxy is solicited on behalf of the Board of Directors of
Columbia Sportswear Company, an Oregon corporation, for use at the annual
meeting of shareholders to be held on May 25, 2000 and at any adjournment
thereof. The annual meeting will be held at 2:00 p.m., Pacific Time, on
Thursday, May 25, 2000, at the Multnomah Athletic Club at 1849 SW Salmon,
Portland, Oregon.
The Company will bear the cost of preparing and mailing the proxy, proxy
statement, and any other material furnished to shareholders by the Company in
connection with the annual meeting. Proxies will be solicited by use of the
mails, and officers and employees of the Company may also solicit proxies by
telephone or personal contact. Copies of solicitation materials will be
furnished to fiduciaries, custodians, and brokerage houses for forwarding to
beneficial owners of the stock held in their names.
All valid, unrevoked proxies will be voted at the annual meeting in
accordance with the instructions given. Any person giving a proxy in the form
accompanying this proxy statement has the power to revoke it at any time before
its exercise. The proxy may be revoked by filing with the Company, attention
Carl K. Davis, an instrument of revocation or a duly executed proxy bearing a
later date. The proxy may also be revoked by voting in person at the meeting. A
shareholder who attends the meeting, however, is not required to revoke the
proxy and vote in person.
UPON WRITTEN REQUEST TO TIMOTHY P. BOYLE, SECRETARY, ANY PERSON WHOSE PROXY
IS SOLICITED BY THIS PROXY STATEMENT WILL BE PROVIDED, WITHOUT CHARGE, A COPY OF
THE COMPANY'S ANNUAL REPORT ON FORM 10-K. THE ANNUAL REPORT ON FORM 10-K CAN
ALSO BE OBTAINED FROM THE WEBSITE OF THE SECURITIES AND EXCHANGE COMMISSION, AT
WWW.SEC.GOV.
The mailing address of the principal executive offices of the Company is
6600 North Baltimore, Portland, Oregon 97203, and its telephone number is (503)
286-3676. The approximate date this proxy statement and the accompanying proxy
form are first being sent to shareholders is April 28, 2000.
VOTING SECURITIES AND PRINCIPAL SHAREHOLDERS
The Common Stock is the only outstanding authorized voting security of the
Company. The record date for determining holders of Common Stock entitled to
vote at the annual meeting is April 14, 2000. On that date there were 25,382,022
shares of Common Stock outstanding, entitled to one vote per share. The Common
Stock does not have cumulative voting rights.
The following table sets forth certain information regarding the beneficial
ownership as of December 31, 1999 of the Company's Common Stock by (i) each
person known by the Company to own beneficially more than 5% of the Common
Stock, (ii) each director or nominee to become director of the Company, (iii)
each executive officer of the Company named in the Summary Compensation Table,
and (iv) all executive officers
<PAGE> 4
and directors as a group. Except as otherwise noted, the persons listed below
have sole investment and voting power with respect to the Common Stock owned by
them.
<TABLE>
<CAPTION>
SHARES PERCENTAGE
BENEFICIAL OWNER BENEFICIALLY OWNED(1) OF SHARES
---------------- --------------------- ----------
<S> <C> <C>
Gertrude Boyle......................................... 4,179,533(2) 16.5%
6600 North Baltimore
Portland, Oregon 97203
Timothy P. Boyle....................................... 10,545,058(3) 41.6%
6600 North Baltimore
Portland, Oregon 97203
Sarah A. Bany.......................................... 3,138,877(4) 12.4%
6600 North Baltimore
Portland, Oregon 97203
Don R. Santorufo....................................... 880,435(5) 3.5%
Terry J. Brown......................................... 42,857(6) *
Robert G. Masin........................................ 31,472(7) *
Murrey R. Albers....................................... 8,399(8) *
Edward S. George....................................... 17,580(9) *
Walter T. Klenz........................................ 0 *
John Stanton........................................... 130,954(10) *
All directors, nominees and executive officers as a
group (12 persons)................................... 19,043,577(11) 74.7%
</TABLE>
- ---------------
* Less than 1%.
(1) Shares which the person or group has the right to acquire within 60 days
after December 31, 1999 are deemed to be outstanding in calculating the
percentage ownership of the person or group but are not deemed to be
outstanding as to any other person or group.
(2) Includes 636,074 shares held in two grantor retained annuity trusts for
which Mrs. Boyle is the income beneficiary and Ms. Bany is the beneficiary
of the remainder.
(3) Includes 173,900 shares held in trust, of which Mr. Boyle's wife is
trustee, for the benefit of Mr. Boyle's children.
(4) Includes (a) 118,000 shares held in trust, of which Ms. Bany's husband is
trustee, for the benefit of Ms. Bany's children, (b) 657,750 shares held in
two grantor retained annuity trusts for which Ms. Bany is the income
beneficiary and Ms. Bany's husband and children are beneficiaries of the
remainder and (c) 777 shares subject to options exercisable within 60 days
after December 31, 1999.
(5) Includes 391,389 shares that vest ratably over five years ending December
31, 2004.
(6) Includes 38,857 shares subject to options exercisable within 60 days after
December 31, 1999.
(7) Includes 28,727 shares subject to options exercisable within 60 days after
December 31, 1999.
(8) Includes 5,399 shares subject to options exercisable within 60 days after
December 31, 1999.
(9) Includes 7,980 shares subject to options exercisable within 60 days after
December 31, 1999.
(10) Includes 5,104 shares subject to options exercisable within 60 days after
December 31, 1999.
(11) Includes 129,456 shares subject to options exercisable within 60 days after
December 31, 1999.
PROPOSAL 1: ELECTION OF DIRECTORS
The directors of the Company are elected at each annual meeting to serve
until the next annual meeting and until their successors are elected and
qualified. Each nominee other than Walter T. Klenz is now serving as a director
of the Company. If a quorum of shareholders is present at the annual meeting,
the seven nominees for election as directors who receive the greatest number of
votes cast at the meeting will be elected directors. Abstentions and broker
nonvotes will have no effect on the results of the vote. Unless otherwise
instructed, proxy holders will vote the proxies they receive for the nominees
named below. If any of the
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nominees for director at the annual meeting becomes unavailable for election for
any reason, the proxy holders will have discretionary authority to vote pursuant
to the proxy for a substitute or substitutes. The following table briefly
describes the Company's nominees for directors.
<TABLE>
<CAPTION>
NAME, PRINCIPAL OCCUPATION, AND OTHER DIRECTORSHIPS AGE DIRECTOR SINCE
--------------------------------------------------- --- --------------
<S> <C> <C>
GERTRUDE BOYLE has served as Chairman of the Board of 76 1970
Directors since 1970. Mrs. Boyle also served as the
Company's President from 1970 to 1988.
TIMOTHY P. BOYLE joined the Company in 1971 as general 50 1978
manager and has served as President and Chief Executive
Officer since 1988. Mr. Boyle also serves as the Company's
Secretary. Mr. Boyle is Gertrude Boyle's son.
SARAH BANY held various positions at the Company between 41 1988
1979 and August 1998, most recently as Director of Retail
Stores. Ms. Bany is Gertrude Boyle's daughter.
MURREY R. ALBERS became a director of the Company in July 58 1993
1993. Mr. Albers is President and Chief Executive Officer of
United States Bakery, a bakery with operations in Oregon,
Washington, Idaho, Montana and California. Mr. Albers, who
has been in his current position since June 1985, joined
United States Bakery as general manager of Franz Bakery in
1975. Mr. Albers chairs the Compensation Committee.
EDWARD S. GEORGE became a director of the Company in April 63 1989
1989. For 30 years, until his retirement, Mr. George worked
in the banking industry. From 1980 to 1990, he was President
and CEO of Torrey Pines Bank. Between 1991 and 1998 he
served as a financial consultant. Mr. George is also a
director of First National Bank of San Diego. Mr. George
chairs the Audit Committee.
WALTER T. KLENZ has served as President and Chief Executive 54
Officer of Beringer Wine Estates since 1990, and has been
chairman of its board of directors since August 1997. Mr.
Klenz joined Beringer Wine Estates in 1976 as director of
marketing for the Beringer brand. He also serves on the
Board of Directors of America West Airlines. Mr. Klenz was
nominated for Columbia Sportswear Company's Board of
Directors in April 2000.
JOHN STANTON became a director of the Company in July 1997. 44 1997
Since 1992, Mr. Stanton has served as Chairman, Chief
Executive Officer and director of Western Wireless
Corporation, a publicly held cellular communications
company, and its predecessors. Mr. Stanton is also Chairman,
Chief Executive Officer, and director of VoiceStream
Wireless Corporation, a publicly traded company that is a
spin-off of Western Wireless. He previously co-founded McCaw
Cellular Communications, where he served as Chief Operating
Officer from 1985 to 1988 and as Vice Chairman from 1988 to
1991. Mr. Stanton also serves as a director of other
corporations, including Advanced Digital Information
Corporation and Microcell, a Canadian wireless company. Mr.
Stanton chairs the Nominating Committee.
</TABLE>
BOARD MEETINGS AND COMMITTEES
The Board of Directors met five times in 1999. No director attended fewer
than 75% of the aggregate of all meetings of the Board of Directors and the
committees of which the director was a member during 1999. The standing
committees of the Board of Directors are the Audit Committee, the Compensation
Committee and the Nominating Committee.
The Audit Committee, which met two times in 1999, makes recommendations
concerning the engagement of the independent public accountants, reviews with
the independent public accountants the plans and results of audits, approves
professional services provided by the independent public accountants, reviews
the independence of the independent public accountants, considers the range of
audit and nonaudit fees, and reviews the adequacy of the Company's internal
accounting controls. The Audit Committee consists of Messrs. Stanton, George and
Albers. The Compensation Committee, which met three times in 1999,
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<PAGE> 6
determines compensation for the Company's executive officers and administers the
Company's 1997 Stock Incentive Plan and the 1999 Employee Stock Purchase Plan.
The Compensation Committee consists of Messrs. Stanton, George and Albers. The
Nominating Committee, which met two times in 1999, reviews the composition of
the Board and makes recommendations regarding nominations for director.
Shareholders wishing to recommend a prospective nominee for the Board of
Directors may do so by following the procedures set forth in the Company's
bylaws, which are summarized below under "Shareholder Nominations for Director."
The Nominating Committee consists of Messrs. Stanton, George and Albers.
COMPENSATION OF DIRECTORS
Directors who are not officers of the Company receive annual compensation
of $15,000 plus $1,000 per meeting attended in addition to reasonable
out-of-pocket expenses incurred in attending meetings. Each year Directors who
are not officers of the Company receive an option to acquire 3,500 shares of
Common Stock and a $2,000 Columbia Sportswear apparel merchandise allowance.
RECOMMENDATION BY THE BOARD OF DIRECTORS
The Board of Directors recommends that shareholders vote FOR the election
of the nominees named in this proxy statement.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth all compensation paid by the Company for
each of the last three years to the Chief Executive Officer and the four other
most highly compensated executive officers.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION SECURITIES
---------------------------- UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS COMPENSATION(1)
--------------------------- ---- -------- ---------- ------------ ---------------
<S> <C> <C> <C> <C> <C>
Timothy P. Boyle..................... 1999 $450,259 $ 403,333 -- $16,778(2)
President and Chief Executive
Officer 1998 $541,303 $ 554,989 -- $ 9,774
1997 $323,733 $ 805,000 -- $13,641
Don R. Santorufo..................... 1999 $456,394 $ 225,000 -- $17,038(2)
Executive Vice President and 1998 $443,733 $ 618,257(3) -- $ 9,774
Chief Operating Officer 1997 $286,946 $1,287,214(3) -- $13,641
Gertrude Boyle....................... 1999 $508,587 $ 453,842 -- $11,789
Chairman of the Board 1998 $486,692 $ 400,000 -- $ 9,774
1997 $153,920 $ 460,000 -- $13,641
Robert G. Masin...................... 1999 $290,221 $ 102,015 5,600 $15,960(2)
General Merchandise Manager 1998 $248,269 $ 100,588 30,000 $ 9,774
1997 $213,370 $ 85,385 29,500 $13,641
Terry J. Brown....................... 1999 $224,078 $ 101,750 8,600 $15,603(2)
Vice President, Planning and Chief 1998 $200,663 $ 70,894 44,073 $ 9,774
Information Officer 1997 $189,305 $ 75,721 59,000 $13,641
</TABLE>
- ---------------
(1) Includes the Company's matching contribution under the Company's 401(k)
savings plan of $4,750 for 1997 and $5,000 for each of 1998 and 1999, and a
profit sharing contribution of $8,891 for 1997, $4,774 for 1998 and $6,789
for 1999.
(2) Includes $4,989, $5,249, $4,171 and $3,814 for Messrs. Boyle, Santorufo,
Masin and Brown, respectively, paid in connection with an executive officer
disability insurance premium.
(3) Includes bonuses paid to Mr. Santorufo of $597,214 for 1997 and $163,008 for
1998 for amounts equal to the accrued interest due and owing on Mr.
Santorufo's loan from the Company in connection with his Deferred
Compensation Conversion Agreement, increased to offset taxes owed by Mr.
Santorufo as a result of the bonuses.
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<PAGE> 7
STOCK OPTION GRANTS IN LAST FISCAL YEAR
The following table provides information regarding stock options granted in
1999 to the executive officers named in the Summary Compensation Table.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
NUMBER OF PERCENTAGE OF RATES OF ANNUAL STOCK
SHARES OPTIONS GRANTED PRICE APPRECIATION
UNDERLYING TO EMPLOYEES EXERCISE FOR OPTION TERM(2)
OPTIONS DURING PRICE EXPIRATION ----------------------
NAME GRANTED(1) FISCAL YEAR PER SHARE DATE 5% 10%
---- ---------- --------------- --------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Gertrude Boyle.................. -- -- -- -- -- --
Timothy P. Boyle................ -- -- -- -- -- --
Don R. Santorufo................ -- -- -- -- -- --
Robert G. Masin................. 5,600 1.8% 12.25 2/23/09 $43,120 $109,312
Terry J. Brown.................. 8,600 2.8% 12.25 2/23/09 $66,220 $167,872
</TABLE>
- ---------------
(1) Mr. Masin's and Mr. Brown's options vest and become exercisable over a
period of five years on a monthly vesting schedule.
(2) In accordance with rules of the Securities and Exchange Commission, these
amounts are the hypothetical gains or option spreads that would exist for
the respective options based on assumed compounded rates of annual stock
price appreciation of 5% and 10% from the date the options were granted over
the option term.
AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUES
The following table indicates for all executive officers named in the
Summary Compensation Table (i) stock options exercised during 1999, including
the value realized on the date of exercise, (ii) the number of shares subject to
exercisable (vested) and unexercisable (unvested) stock options as of December
31, 1999, and (iii) the value of in-the-money options, which represents the
positive difference between the exercise price of existing stock options and the
year-end price of the Common Stock.
<TABLE>
<CAPTION>
NUMBER NUMBER OF SHARES VALUE OF UNEXERCISED
OF SHARES UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
ACQUIRED OPTIONS AT FISCAL YEAR-END FISCAL YEAR-END(1)
ON VALUE --------------------------- ---------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- --------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Gertrude Boyle.................. -- -- -- -- -- --
Timothy P. Boyle................ -- -- -- -- -- --
Don R. Santorufo................ -- -- -- -- -- --
Robert G. Masin................. -- -- 26,559 38,541 $217,351 $239,389
Terry J. Brown.................. -- -- 34,604 78,796 $175,971 $409,823
</TABLE>
- ---------------
(1) Based on the last sale price of $21.50 per share on December 31, 1999.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company leases its corporate headquarters in Portland, Oregon from
Gertrude Boyle and has leased a warehouse from Gertrude Boyle and Timothy P.
Boyle. Pursuant to a five-year written lease dated January 1, 1998, each year
the Company pays $156,096 (as adjusted annually for inflation) to Gertrude Boyle
for use of a portion of the headquarters building. Under another lease, dated
January 1, 1998 and terminated in December 1999, the Company paid Gertrude and
Timothy Boyle $52,848 in 1998 and $49,278 in 1999 for use of a warehouse.
The Company entered into a five-year lease of a building from the Frank
Deggendorfer Trust for $6,250 monthly beginning March 5, 1998. The leased
building houses the Company's Bend, Oregon outlet store. Frank Deggendorfer is
Gertrude Boyle's son-in-law and Timothy P. Boyle's brother-in-law.
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<PAGE> 8
In December 1996 the Company entered into a Deferred Compensation
Conversion Agreement with Don Richard Santorufo, Executive Vice President and
Chief Operating Officer of the Company, providing for the conversion of deferred
compensation units granted under a prior agreement into an aggregate of
1,800,435 shares of the Company's Common Stock. Of those shares, 1,075,321
shares vested immediately, 333,725 shares vest ratably over three years
commencing December 31, 1997, and 391,389 shares vest ratably over five years
commencing December 31, 2000. The agreement provides the Company with a right to
repurchase unvested shares if Mr. Santorufo's employment is terminated. Shares
not repurchased after termination vest automatically. Under the agreement, the
Company provided Mr. Santorufo with bonuses and amounts to cover certain taxes
through 1998. In addition, the Company agreed to pay a cash bonus for up to 50%
of any additional tax liability that may be imposed on Mr. Santorufo with
respect to the compensation received under the agreement. The amount of this
cash bonus would be increased to offset taxes owed by Mr. Santorufo as a result
of such bonus.
In connection with the Company's initial public offering and the
termination of the Company's Subchapter S corporation tax status, the Company
entered into a tax indemnification agreement with each of its shareholders,
including Gertrude Boyle, Timothy P. Boyle, Sarah Bany, Don Richard Santorufo
and certain trusts. The agreements provide that the Company will indemnify and
hold harmless each of these shareholders for federal, state, local or foreign
income tax liabilities, and costs relating thereto, resulting from any
adjustment to the Company's income that is the result of an increase or change
in character of the Company's income during the period it was treated as a
Subchapter S corporation. The agreements also provide that if there is a
determination that the Company was not a Subchapter S corporation prior to the
offering, the shareholders will pay to the Company certain refunds actually
received by them as a result of that determination. In 1998, the Company
reimbursed Gertrude Boyle, Timothy Boyle, and Sarah Bany for income taxes and
related expenses they were assessed of approximately $330,000, $960,000 and
$310,000, respectively, following an audit of the Company's 1995 and 1996
corporate income tax returns. In 1999, the Company paid taxes on behalf of
Gertrude Boyle, Timothy Boyle, Sarah Bany and Don Santorufo of approximately
$19,000, $54,000, $17,000, and $7,000, respectively, for the Company's income
prior to the initial public offering. The Company expects the amounts paid in
1999 to be wholly offset by tax refunds which will be received by the Company in
2000.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee consists of John Stanton, Edward S. George and
Murrey R. Albers, all nonemployee directors. No committee member participates in
committee deliberations or recommendations relating to his own compensation.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors (the "Committee")
consists of Messrs. Stanton, George and Albers, all non-employee directors. The
Committee makes recommendations to the Board regarding compensation for the
executive officers of the Company, and administers the executive compensation
plans, the Company's Employee Stock Purchase Plan and the Company's stock option
program, from which stock options are granted periodically to certain executive
officers and other employees of the Company.
COMPENSATION PRINCIPLES AND PHILOSOPHY
The Committee believes that leadership and motivation of the Company's
executives are critical to the long-term success of the Company. In support of
this philosophy, the Company has adopted an executive compensation policy in
which the primary objectives are to provide a total compensation package:
(1) which will allow it to attract and retain key executive officers
who are primarily responsible for the long-term success of the Company;
(2) that takes into consideration the compensation practices of
comparable companies with whom the Company competes for executive talent;
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<PAGE> 9
(3) which will motivate executives to maximize shareholder returns by
achieving both short and long-term Company goals.
The Committee maintains the philosophy that compensation of the Company's
executives should be directly linked to the financial performance of the Company
as well as to each executive's individual contribution. In determining
competitive compensation levels, the Committee has engaged independent
compensation consultants to analyze base salaries and incentive compensation for
executive officers at comparable companies. Total compensation for executive
officers is generally targeted in the 50 to 75th percentile of pay at these
comparable companies, depending on levels of experience and responsibility.
The total compensation package includes a competitive base salary,
incentive bonuses, periodic stock option grants, as well as a 401(k) plan with a
Company match, and a Company profit sharing plan.
COMPENSATION ELEMENTS
There are different elements in the Company's executive compensation
program, all determined by individual performance and Company profitability,
except for stock option grants which are intended to correlate compensation to
stock price performance.
Base Salary Compensation
Base salaries for the Chief Executive Officer and other select executive
officers have been established by reviewing a number of factors, including
responsibilities, experience, demonstrated performance and potential for future
contributions. The Committee also takes into account competitive factors,
including the level of salaries associated with similar positions at businesses
that compete with the Company.
Annual Incentive Compensation
In 1999, the Board of Directors and shareholders approved the Executive
Incentive Compensation Plan. Under the Executive Incentive Compensation Plan,
the Committee establishes performance goals, which may include Company revenues
or earnings or other benchmarks, within 90 days of the beginning of the calendar
year. Cash bonuses for eligible executive officers will be determined by the
extent to which the Company attains the established goals and by an assessment
of each executive officer's performance during the year. Specific performance
goals to which an eligible executive's bonus is tied will be at the discretion
of the Committee. In each case, the target bonus will be a percentage of the
executive's base salary. Bonuses may exceed the target if performance goals are
exceeded. An executive may also receive no bonus for the year if less than a
predetermined percentage of the applicable performance goal is met. Under the
Executive Incentive Compensation Plan the Committee established a performance
goal for the Company for 1999 based on overall operating results. The Company
achieved 108 percent of specified performance targets, resulting in bonuses for
each executive officer.
Stock Options
Options provide executives with the opportunity to buy and maintain an
equity interest in the Company and to share in the appreciation of the value of
the stock. They also provide a long-term incentive for the executive to remain
with the Company and promote shareholder returns. The Company has made periodic
stock option grants under the 1997 Stock Incentive Plan to most executive
officers. The Company to date has not granted stock options to Timothy P. Boyle,
Gertrude Boyle or Don Richard Santorufo, each of whom has a substantial
ownership interest in the Company, which provides a long-term performance
incentive.
The Committee makes annual stock option grants to certain executives and
other select employees. The number of shares in each grant will depend on
factors such as the level of base pay and individual performance. Stock options
are awarded with an exercise price equal to the fair market value of the
Company's Common Stock at the time of the grant. Options typically vest on a
monthly basis over a period of five years and have ten-year terms. The options
only have value to the recipients if the price of the Company's stock
appreciates after the options are granted.
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<PAGE> 10
OTHER BENEFITS
The Company has a 401(k) plan and a profit-sharing plan, which cover
substantially all employees with more than ninety days of service. The Company
may elect to make discretionary matching and/or non-matching contributions. All
contributions to the plans are determined by the Board of Directors. In
addition, executive officers, other than Timothy and Gertrude Boyle, are
eligible to participate in the Company's 1999 Employee Stock Purchase Plan.
Other benefits that are offered to key executives are largely those that
are offered to the general employee population, with some variation. In general,
they are designed to provide a safety net of protection against the financial
catastrophes that can result from illness, disability or death.
CHIEF EXECUTIVE OFFICER COMPENSATION
The Committee has determined the compensation for the Chief Executive
Officer based on a number of factors. His base salary was determined after a
review of his experience, performance and an evaluation of comparable positions
at other companies. Under the Executive Incentive Compensation Plan total
compensation for Mr. Boyle is tied to the overall financial performance of the
Company. In 1999 Mr. Boyle's base salary was initially decreased by
approximately 20 percent. Upon the Company achieving 100 percent of
predetermined financial performance targets, Mr. Boyle was entitled to receive
the total decrease ($110,000). In addition, Mr. Boyle received a bonus of
$293,333 based on the Company achieving 108 percent of that predetermined
financial goal, as set by the Committee. Following a review of executive
salaries across the apparel industry as well as in the same geographic region,
the Committee raised Mr. Boyle's base salary for 2000 to $690,000. In 2000 he is
eligible for a performance-based bonus of between 30 percent and 220 percent of
his base salary, depending on the Company achieving between 85 percent and 130
percent of predetermined financial targets. Because of Mr. Boyle's substantial
ownership interest in the Company, the Committee believes he has an effective
long-term incentive tied directly to shareholder return.
DEDUCTIBILITY OF COMPENSATION
Section 162(m) of the Internal Revenue Code of 1986 limits to $1,000,000
per person the amount that the Company can deduct for compensation paid to any
of its most highly paid officers in any year. Levels of salary and bonus to be
paid by the Company generally are not expected to exceed that limit. However,
depending on individual and Company performance, total compensation for certain
executives may be greater than $1,000,000. The limit on deductibility, however,
does not apply to performance-based compensation that meets certain
requirements. The Company's current policy is generally to grant stock options
that meet those requirements so that option compensation recognized by an
optionee will be fully deductible by the Company. Similarly the Executive
Incentive Compensation Plan is intended to provide for fully deductible
performance-based compensation.
Members of the Compensation Committee:
Murrey R. Albers -- Chairman
Edward S. George
John Stanton
8
<PAGE> 11
PERFORMANCE GRAPH
Set forth below is a line graph comparing the cumulative total shareholder
return of the Company's Common Stock, assuming reinvestment of dividends, with
the cumulative total return of the Standard & Poor's SmallCap 600 Index and the
S&P Textile (Apparel) Index for the period commencing on March 26, 1998 (the
date of the Company's initial public offering) and ending on December 31, 1999.
The graph assumes that $100 was invested in the Company's Common Stock at the
initial public offering price of $18 and each index on March 26, 1998.
TOTAL SHAREHOLDER RETURNS
PERFORMANCE GRAPH
<TABLE>
<CAPTION>
COLUMBIA S&P SMALLCAP 600 TEXTILES (APPAREL)-
SPORTSWEAR INDEX SMALL
---------- ---------------- -------------------
<S> <C> <C> <C>
3/26/98 100.00 100.00 100.00
3/31/98 117.36 100.56 99.86
6/30/98 105.56 96.07 94.50
9/30/98 90.97 75.98 68.46
12/31/98 93.75 89.36 66.20
3/31/99 109.03 81.32 57.66
6/30/99 85.42 93.85 69.05
9/30/99 79.17 89.31 59.17
12/31/99 119.44 100.44 55.95
</TABLE>
INDEPENDENT ACCOUNTANTS
Deloitte & Touche LLP audited the Company's financial statements for the
year ended December 31, 1999 and has been selected to audit the Company's
financial statements for 2000. Representatives of Deloitte & Touche LLP will be
at the annual meeting and will be available to respond to appropriate questions.
They do not plan to make any statement but will have the opportunity to make a
statement if they wish.
9
<PAGE> 12
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers, directors, and persons who own more than 10% of the Common
Stock to file reports of ownership and changes in ownership with the Securities
and Exchange Commission (SEC). Executive officers, directors, and beneficial
owners of more than 10% of the Common Stock are required by SEC regulation to
furnish the Company with copies of all section 16(a) reports they file. Based
solely on a review of such reports received by the Company and on written
representations from certain reporting persons that they have complied with the
relevant filing requirements, the Company believes that all section 16(a) filing
requirements applicable to its executive officers and directors have been
complied with.
DISCRETIONARY AUTHORITY
Although the Notice of Annual Meeting of Shareholders provides for
transaction of any other business that properly comes before the meeting, the
Board of Directors has no knowledge of any matters to be presented at the
meeting other than the matters described in this proxy statement. The enclosed
proxy, however, gives discretionary authority to the proxy holders to vote in
accordance with their judgment if any other matters are presented.
SHAREHOLDER PROPOSALS
SHAREHOLDER PROPOSALS TO BE INCLUDED IN THE COMPANY'S PROXY STATEMENT
A shareholder proposal to be considered for inclusion in proxy materials
for the Company's 2001 annual meeting must be received by the Company not later
than December 29, 2000.
SHAREHOLDER PROPOSALS NOT IN THE COMPANY'S PROXY STATEMENT
Shareholders wishing to present proposals for action at this annual meeting
or at another shareholders' meeting must do so in accordance with the Company's
Bylaws, a copy of which is available upon written request to Carl K. Davis, Vice
President and General Counsel. A shareholder must give timely notice of the
proposed business to the Secretary. For purposes of the Company's 2001 annual
meeting, such notice, to be timely, must be received by the Company by January
29, 2001.
SHAREHOLDER NOMINATIONS FOR DIRECTOR
Shareholders wishing to directly nominate candidates for election to the
Board of Directors at an annual meeting must do so in accordance with the
Company's Bylaws by giving timely notice in writing to the Secretary as defined
above. The notice shall set forth (a) the name and address of the shareholder
who intends to make the nomination, (b) the name, age, business address and
residence address of each nominee, (c) the principal occupation or employment of
each nominee, (d) the class and number of shares of the Company which are
beneficially owned by each nominee and by the nominating shareholder, (e) any
other information concerning the nominee that must be disclosed of nominees in
proxy solicitations pursuant to Regulation 14A of the Securities Exchange Act of
1934, and (f) the executed consent of each nominee to serve as a director of the
Company if elected. If the number of directors to be elected is increased and
there is no public announcement by the Company naming all nominees or specifying
the size of the increased Board of Directors at least 100 days prior to the
first anniversary of the preceding years annual meeting, a shareholder's notice
shall also be considered timely (but only with respect to nominees for new
positions created by such increase) if delivered to the Secretary at the
Company's principal executive offices no later than the close of business on the
tenth day following the day on which the public announcement is first made by
the Company. Shareholders wishing to make any director nominations at any
special meeting of shareholders held for the purpose of electing directors must
do so, in accordance with the Bylaws, by delivering timely notice to the
Secretary setting forth the information described above for annual meeting
nominations. To be timely, the notice must be delivered to the Secretary at the
principal executive offices of the Company not earlier than the
10
<PAGE> 13
close of business on the 90th day prior to the special meeting and not later
than the close of business on the tenth day following the day on which public
announcement is first made of the date of the special meeting and of the
nominees proposed by the Board to be elected at the meeting. The officer
presiding at the meeting may, if in the officer's opinion the facts warrant,
determine that a nomination was not made in accordance with the procedures
prescribed by the Bylaws. If such officer does so, such officer shall so declare
to the meeting and the defective nomination shall be disregarded.
By Order of the Board of Directors
Timothy P. Boyle
President and Chief Executive Officer
Portland, Oregon
April 28, 2000
11
<PAGE> 14
PROXY
COLUMBIA SPORTSWEAR COMPANY
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
THE COMPANY FOR THE ANNUAL MEETING MAY 25, 2000
The undersigned hereby appoints Timothy P. Boyle, Patrick D. Anderson and
Carl K. Davis, and each of them, proxies with full power of substitution, to
vote in behalf of the undersigned at the Annual Meeting of Shareholders of
Columbia Sportswear Company on May 25, 2000, and at any adjournment thereof,
all shares of the undersigned in Columbia Sportswear Company. The proxies are
instructed to vote as follows:
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED IN ACCORDANCE WITH
INSTRUCTIONS, IF GIVEN. IF NO INSTRUCTIONS ARE GIVEN, THEY WILL BE VOTED FOR
THE DIRECTORS. THE PROXIES MAY VOTE IN THEIR DISCRETION AS TO OTHER MATTERS
THAT MAY COME BEFORE THE MEETING.
PLEASE SIGN ON OTHER SIDE AND RETURN PROMPTLY
- --------------------------------------------------------------------------------
/\ FOLD AND DETACH HERE /\
<PAGE> 15
Please mark
your votes [X]
as in this
example
(THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEM 1.)
<TABLE>
<S> <C> <C> <C>
FOR WITHHELD
1. Election of Directors [ ] [ ] To facilitate meeting arrangements, please check here [ ]
NOMINEES: if you plan to attend the meeting in person.
Gertrude Boyle, Timothy P. Boyle, Sarah Bany,
Murrey R. Albers, Edward S. George,
Walter T. Klenz and John Stanton
For, except vote withheld from the following nominee(s):
- ---------------------------------------------------------
SIGNATURE(S) DATE
------------------------------------------------------------------------------------- --------------------------
NOTE: Please sign exactly as name(s) appears hereon. Joint owners should each sign. Please mark, date, sign and return proxy
card promptly. Receipt is acknowledged of the notice and proxy statement relating to this meeting.
................................................................................................................................
/\ FOLD AND DETACH HERE /\
</TABLE>
