<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
<TABLE>
<S> <C>
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-12
WD-40 COMPANY
-----------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
-----------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
</TABLE>
Payment of Filing Fee (Check the appropriate box):
<TABLE>
<S> <C> <C>
/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:
----------------------------------------------------------
(4) Date Filed:
----------------------------------------------------------
</TABLE>
<PAGE>
[LOGO]
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
December 12, 2000
<PAGE>
WD-40 COMPANY
1061 Cudahy Place
San Diego, California 92110
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders:
The 2000 Annual Meeting of Stockholders will be held at the Mission Valley
Doubletree Hotel, Grand Ballroom, 7450 Hazard Center Drive, San Diego,
California 92108, on Tuesday, December 12, 2000, at 2:00 p.m. for the following
purposes:
1. To elect a Board of Directors for the ensuing year and until their
successors are elected and qualified;
2. To authorize an amendment to the WD-40 Company 1990 Incentive Stock
Option Plan to increase the number of shares reserved for issuance
pursuant to the Plan from 1,480,000 to 2,980,000 shares;
3. To ratify the selection of PricewaterhouseCoopers LLP as the Company's
independent accountants for the fiscal year 2001; and
4. To consider and act upon such other business as may properly come before
the meeting.
Only the stockholders of record at the close of business on October 13, 2000
are entitled to vote at the meeting.
By Order of the Board of Directors
Harlan F. Harmsen
Secretary
San Diego, California
November 9, 2000
1
<PAGE>
PROXY STATEMENT
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of WD-40 Company for use at its Annual Meeting
of Stockholders to be held on December 12, 2000, and at any postponements or
adjournments thereof. This Proxy Statement and enclosed form of Proxy are first
sent to stockholders on or about November 9, 2000.
At the meeting, the stockholders of WD-40 Company will vote to (i) elect the
Board of Directors for the ensuing year, (ii) approve an amendment to the
Company's 1990 Incentive Stock Option Plan, and (iii) ratify the selection of
PricewaterhouseCoopers LLP as the Company's independent accountants. Detailed
information concerning these matters is set forth below. Management knows of no
other business to come before the meeting.
The close of business on October 13, 2000 is the record date for
stockholders entitled to notice of and to vote at the Annual Meeting of
Stockholders of WD-40 Company. On October 13, 2000, WD-40 Company had
outstanding 15,434,304 shares of $.001 par value common stock. Stockholders of
record entitled to vote at the meeting will have one vote for each share so held
on the matters to be voted upon. A majority of the outstanding shares will
constitute a quorum at the meeting. Abstentions and broker non-votes are counted
for purposes of determining the presence or absence of a quorum.
If the enclosed form of Proxy is properly executed and returned, the shares
represented thereby will be voted in accordance with the instructions specified
thereon. Except as described herein with respect to broker non-votes, if no
specification is made, the shares will be voted by the proxy holder as set forth
on the Proxy. A Proxy may be revoked by attendance at the meeting or by filing a
Proxy bearing a later date with the Secretary of the Company.
The cost of soliciting proxies will be borne by the Company. Solicitations
other than by mail may be made by telephone or in person by employees of the
Company for which the expense will be nominal.
PRINCIPAL SECURITY HOLDERS
The following table sets forth information concerning those persons known to
the Company to be the beneficial owners of more than 5% of the common stock of
the Company.
<TABLE>
<CAPTION>
Amount and Nature
of Beneficial
Ownership Percent
Name and Address of Beneficial Owner October 13, 2000 of Class
------------------------------------ ----------------- --------
<S> <C> <C>
Mario L. Crivello........................................... 980,916 6.4%
San Diego, California
</TABLE>
1 Mr. Crivello has sole voting and investment power over 869,952 shares held in
trust for the benefit of his mother and remainder beneficiaries. He also has
sole voting and investment power over 14,780 shares held as custodian for
children and 96,184 shares held directly.
2
<PAGE>
ITEM NO. 1
NOMINEES FOR ELECTION AS DIRECTORS
AND SECURITY OWNERSHIP OF MANAGEMENT
Unless marked to the contrary, the Proxies received will be voted for the
election of the nine nominees named below to serve as Directors until the next
Annual Meeting of Stockholders and until their successors are elected or
appointed. In the event any nominee is unable or declines to serve as a Director
at the time of the Annual Meeting, his or her Proxy will be voted for a nominee
designated by the present Board of Directors to fill such vacancy.
The nominees for election to the Board of Directors who receive the greatest
number of votes cast for the election of Directors by the shares present, in
person or by proxy, shall be elected Directors. Holders of common stock are not
entitled to cumulate their votes in the election of Directors. Withheld votes
and broker non-votes (which are treated as "withheld" votes) are not counted as
votes in favor of any nominee. Since the nominees receiving the most votes will
be elected as Directors, withheld votes and broker non-votes will have no effect
upon the outcome of the election.
Article III, Section 2 of the Bylaws of the Company, approved by
stockholders on December 14, 1999, provides that the authorized number of
Directors of the Company shall be not less than nine nor more than twelve until
changed by amendment of the Articles of Incorporation or by a bylaw duly adopted
by the stockholders. The exact number of Directors is to be fixed from time to
time by a bylaw or amendment thereof duly adopted by the stockholders or by the
Board of Directors. The number of Directors was fixed at nine by resolution of
the Board of Directors on September 26, 2000.
3
<PAGE>
Security Ownership of Directors and Executive Officers
The following table sets forth certain information, including beneficial
ownership of the Company's common stock, for the nine nominees, for the
executive officers named in the Summary Compensation Table on Page 8, and for
all Directors and executive officers as a group. John S. Barry and C. Fredrick
Sehnert retired from the Board of Directors on September 26, 2000.
<TABLE>
<CAPTION>
Amount and Nature of
Beneficial Ownership
October 13, 2000(2)
Director -----------------------------
Nominee Age Principal Occupation Since Number Percent of Class
------- -------- -------------------------------- -------- ---------- ----------------
<S> <C> <C> <C> <C> <C>
Mario L. Crivello 60 Investor 1994 980,916(2) 6.4%
Daniel W. Derbes 70 Chairman, WD-40 Company 1984 1,600 *
President, Signal Ventures
Harlan F. Harmsen 73 Retired Attorney; Secretary, 1977 6,500(3) *
WD-40 Company
Jack L. Heckel 69 Retired; Former President and 1989 4,430 *
Chief Operating Officer, GenCorp
Gary L. Luick 60 President and CEO, 2000 350 *
Clickgarden, Inc.
Kenneth E. Olson 64 Retired; Former Chairman and 2000 1,000 *
CEO, Proxima Corporation
Garry O. Ridge 44 President and CEO, WD-40 Company 1997 71,003(4) *
Gerald C. Schleif 65 Retired, Former President and 1989 45,292 *
CEO, WD-40 Company
Edward J. Walsh 68 President, The Sparta Group, 1988 3,600 *
Ltd.
Executive Officers
Michael L. Freeman 47 Vice President Operations and N/A 33,182(5) *
Chief Information Officer, WD-40
Company
Graham P. Milner 46 Senior Vice President, The N/A 42,857(6) *
Americas, WD-40 Company
William B. Noble 42 Managing Director Europe, WD-40 N/A 33,739(7) *
Company Ltd. (U.K.)
Thomas J. Tranchina 52 Vice President Finance, Chief N/A 17,274(8) *
Financial Officer and Treasurer,
WD-40 Company
All Directors and
Executive Officers as
a Group 1,290,182(9) 8.2%
</TABLE>
* Less than one (1) percent.
1 All shares owned directly unless otherwise indicated.
4
<PAGE>
2 Mr. Crivello has sole voting and investment power over 869,952 shares held in
trust for the benefit of his mother and remainder beneficiaries. He also has
sole voting and investment power over 14,780 shares held as custodian for
children and 96,184 shares held directly.
3 Mr. Harmsen has sole voting and investment power over 500 shares held in
trust for others and 6,000 shares held directly.
4 Mr. Ridge has the right to acquire 60,272 shares upon exercise of stock
options. Mr. Ridge has voting power over 731 shares held under the Company's
401(k) Plan.
5 Mr. Freeman has the right to acquire 29,386 shares upon exercise of stock
options. Mr. Freeman has voting power over 996 shares held under the
Company's 401(k) Plan.
6 Mr. Milner has the right to acquire 39,981 shares upon exercise of stock
options. Mr. Milner has voting power over 1,020 shares held under the
Company's 401(k) Plan.
7 Mr. Noble has the right to acquire 33,439 shares upon exercise of stock
options.
8 Mr. Tranchina has the right to acquire 16,000 shares upon exercise of stock
options and he has voting power over 166 shares held under the Company's
401(k) Plan.
9 Total includes the rights of executive officers to acquire 225,673 shares
upon exercise of stock options and also includes 3,457 shares held under the
Company's 401(k) Plan over which individual executive officers have voting
power.
Nominees for Election as Directors
Mario L. Crivello was elected to the Board of Directors in 1994 following
the death of his father, Sam Crivello, a Company founder. Mr. Crivello is
retired, having been the managing owner and master of Tuna Purse Seiners.
Daniel W. Derbes was elected to the Board of Directors in 1984 and named
Chairman of the Board on September 26, 2000. He is President of Signal Ventures,
a venture capital firm. Mr. Derbes served as President of Allied-Signal
International, Inc. and Executive Vice President of the parent corporation until
his retirement in 1988. Mr. Derbes is also a director of Sempra Energy
Corporation (and its subsidiaries, San Diego Gas & Electric Company, Pacific
Enterprises, Enova Corporation and Southern California Gas Co.)
Harlan F. Harmsen practiced law in San Diego, California from 1957 to 1989.
He has been a Director of the Company since 1977 and was named Secretary of the
Company in 1982.
Jack L. Heckel was elected to the Board of Directors in 1984. He served as
President and Chief Operating Officer of GenCorp from 1987 through 1993. He was
named President of Aerojet General (a division of GenCorp) in 1981 and was
elected Chairman of the Board in 1984. Mr. Heckel joined Aerojet General in 1956
and served as a Group Vice President from 1977 through 1981. Mr. Heckel is also
a director of Advanced Tissue Sciences, Inc. and APW, Ltd.
Gary L. Luick was elected to the Board of Directors in March 2000. Mr. Luick
is the President and CEO of Clickgarden, Inc., an internet software company.
From 1989 through 1996 he served as President and CEO of GTI Corp., a networking
products company, and he was President and CEO of Coded Communications, a
wireless networking company, from 1997 to 1998.
Kenneth E. Olson was elected to the Board of Directors in March 2000. Mr.
Olson served as Chairman and CEO of Proxima Corporation, an electronic
projection products company, from 1990 to 1998. He is a director of Avanir
Pharmaceuticals.
5
<PAGE>
Garry O. Ridge joined WD-40 Company in 1987 as Managing Director, WD-40
Company (Australia) Pty. Limited and he was responsible for company operations
throughout the Pacific and Asia. Mr. Ridge transferred to the corporate office
in September 1994 as Director International Operations and was elected Vice
President--International in June 1995. He was elected to the position of
Executive Vice President/Chief Operating Officer in December 1996 and he was
named President and Chief Executive Officer as of October 1, 1997. He was also
elected to the Board of Directors on November 25, 1997. Prior to joining WD-40
Company Mr. Ridge was Managing Director of Mermax Pacific Pty. Ltd. and held a
number of senior management positions with Hawker Pacific Pty. Ltd. (A Hawker
Siddeley PLC Group Company) which was a licensee for WD-40 until 1988.
Gerald C. Schleif joined the Company in 1969 as Marketing Manager. Mr.
Schleif served as Chief Executive Officer from 1992 and as Company President
from 1990 through September 1997. He held the offices of Vice
President-Marketing, Executive Vice President, Treasurer and Chief Operating
Officer. Mr. Schleif has been a Director since 1989.
Edward J. Walsh was elected to the Board of Directors in 1988. He is
President of The Sparta Group, Ltd., a business consulting organization. Mr.
Walsh was employed by The Dial Corporation and its predecessor, Armour-Dial
Corporation, for 27 years, serving as its President and Chief Executive Officer
from 1984 to 1987. He is also a director of Guest Supply, Inc. and Nortrust of
Arizona Holding Corporation.
Compensation, Committees and Meetings of the Board of Directors
Each outside director receives an annual fee of $15,000, payable in
quarterly installments. Outside directors receive an additional fee of $500 for
attendance at committee meetings and committee chairpersons receive $750 for
each meeting. The Company maintains a Non-Employee Director Restricted Stock
Plan providing for the issuance of 350 shares of restricted common stock of the
Company to each non-employee member of the Board of Directors in lieu of $5,000
of cash compensation. The issuance of shares in lieu of cash compensation is
mandatory for any director who does not hold shares of the Company having a fair
market value of at least $50,000 and optional for all other directors. Pursuant
to an amendment to the plan adopted in June 2000, any director may elect to
receive 1,000 shares of restricted common stock in lieu of their full annual
compensation, excluding compensation for attendance at committee meetings. The
shares do not become vested for resale for a period of five years except in the
event of death or retirement from the Board. The number of shares to be issued
will be reviewed annually to account for changes in the price of the shares on
the open market.
There were four scheduled meetings and one special meeting of the Board of
Directors during the last fiscal year. All directors attended at least 75
percent of the aggregate of the total number of meetings of the Board and of all
committees on which the director served. The Board of Directors has an Audit
Committee, a Governance and Nominating Committee, and a Compensation Committee.
The Audit Committee is comprised of Edward J. Walsh (Chairman), Harlan F.
Harmsen and Gerald C. Schleif. Two meetings were held during the last fiscal
year to consider the annual audit and review the audit with the independent
accountants after its completion. The Audit Committee also provides its
recommendations to the full Board of Directors with respect to the selection and
appointment of independent accountants for the Company.
The Governance and Nominating Committee is comprised of Jack L. Heckel
(Chairman), Daniel W. Derbes, Kenneth E. Olson and Garry O. Ridge. Three
meetings were held during the last fiscal year. The Governance and Nominating
Committee was established to provide for regular evaluation of succession
6
<PAGE>
plans and the performance, independence, qualifications and integrity of both
the Board of Directors and the management of the Company.
Compensation Committee Interlocks and Insider Participation
The Compensation Committee is comprised of Daniel W. Derbes (Chairman),
Mario L. Crivello, Jack L. Heckel, Gary L. Luick and Edward J. Walsh, all of
whom are outside directors.
The function of the Compensation Committee is to provide guidance to the
Board of Directors and oversight for all executive compensation and benefit
programs. The Committee provides recommendations for base salary and incentive
compensation awards for the CEO and executive officers. The Compensation
Committee also serves as the Stock Option Committee with authority to grant
options and administer the Company's Incentive Stock Option Plans. The
Compensation Committee met twice during the last fiscal year.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent of
the Company's stock, to file with the Securities and Exchange Commission initial
reports of stock ownership and reports of changes in stock ownership. Reporting
persons are required by SEC regulation to furnish the Company with copies of all
Section 16(a) reports they file.
To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company during the last fiscal year and written
representations that no other reports were required, all Section 16(a)
requirements were complied with by all persons required to report with respect
to the Company's stock during the last fiscal year.
7
<PAGE>
EXECUTIVE COMPENSATION
The following table shows information for the three (3) fiscal years ended
August 31, 2000 concerning the Company's Chief Executive Officer and each of the
next four highest paid executive officers.
Summary Compensation Table(1)
<TABLE>
<CAPTION>
Long Term
Annual Compensation All Other
Compensation Awards Compensation(2)
Fiscal Year ---------------------- ----------------- ---------------
Name and Principal Position Ended Aug. 31 Salary ($) Bonus ($) Stock Options (#) ($)
--------------------------- ------------- ---------- --------- ----------------- ---------------
<S> <C> <C> <C> <C> <C>
Garry O. Ridge 2000 $295,000 $150,450 20,000 $26,000(3)
President and Chief 1999 275,000 106,650 16,000 26,000
Executive Officer 1998 255,000 150,000 16,000 26,000
Thomas J. Tranchina 2000 $142,500 $ 38,340 10,000 $26,000(3)
Vice President Finance and 1999 126,000 29,850 6,000 25,585
Chief Financial Officer 1998 36,250 10,000 -0- -0-
Graham P. Milner 2000 $159,500 $ 59,015 10,000 $26,000(3)
Senior Vice President, 1999 149,100 35,150 6,000 26,000
The Americas 1998 140,000 55,000 6,000 26,000
Michael L. Freeman 2000 $154,000 $ 56,980 10,000 $26,000(3)
Vice President Operations 1999 143,800 33,750 6,000 26,000
and Chief Information
Officer 1998 135,000 55,000 6,000 26,000
William B. Noble(4) 2000 $176,200 $ 47,600 10,000 $ -0-
Managing Director Europe 1999 172,850 57,600 6,000 -0-
WD-40 Company Ltd. (U.K.) 1998 154,500 57,900 6,000 -0-
</TABLE>
1 No information for Other Annual Compensation, Restricted Stock Awards or Long
Term Incentive Payouts has been provided because there was no such
reportable compensation awarded to, earned by or paid to the individuals
named.
2 All Other Compensation includes employer contributions to the Company's Money
Purchase Pension Plan, Profit Sharing Plan and 401(k) Plan.
3 Includes $24,000 in contributions to the Company's Money Purchase Pension
Plan and Profit Sharing Plan and $2,000 in matching contributions to the
Company's 401(k) Plan.
4 Mr. Noble is employed by the Company's U.K. subsidiary. Compensation amounts
have been converted to U.S. Dollars at average annual exchange rates for
each year.
8
<PAGE>
Stock Options
The following table sets forth stock options granted pursuant to the
Restated WD-40 Company 1990 Incentive Stock Option Plan during the last fiscal
year to each of the Company's executive officers named in the Summary
Compensation Table above.
Option Grants in Last Fiscal Year
<TABLE>
<CAPTION>
Percent of Total Options
Options Granted Granted to Employees Exercise Price Grant Date
Name (#) in Fiscal Year 2000 ($/Sh) Expiration Date Value(1)
---- --------------- ------------------------ -------------- --------------- ----------
<S> <C> <C> <C> <C> <C>
Garry O. Ridge 20,000 (2) 8.1% $23.50 9/28/2009 $85,400
Thomas J. Tranchina 10,000 (3) 4.0 23.50 9/28/2009 42,700
Graham P. Milner 10,000 (4) 4.0 23.50 9/28/2009 42,700
Michael L. Freeman 10,000 (5) 4.0 23.50 9/28/2009 42,700
William B. Noble 10,000 (6) 4.0 23.50 9/28/2009 42,700
</TABLE>
1 The Grant Date Value of $4.27 per share has been determined using the
Black-Scholes Option Valuation model. The following assumptions were used in
determining the value: (i) a dividend yield of 5.57%; (ii) expected
volatility of .5512; (iii) a ten-year risk-free rate of return of 5.78%; and
(iv) exercise ten years from the grant date.
2 Mr. Ridge's options are non-qualified options exercisable in full on
September 28, 2000.
3 Mr. Tranchina received incentive stock options as to 2,621 shares and
non-qualified stock options as to 7379 shares. All of his options are
exercisable in full on September 28, 2000.
4 Mr. Milner's options are non-qualified options exercisable in full on
September 28, 2000.
5 Mr. Freeman's options are non-qualified options exercisable in full on
September 28, 2000.
6 Mr. Noble's options are non-qualified options exercisable in full on
September 28, 2000.
The options may be exercised for cash or in lieu of cash, an option holder
may tender shares of the Company's common stock previously held by the option
holder. In permitting the exchange of stock upon exercise of options, the 1990
Incentive Stock Option Plan restricts the exercise of options with previously
owned stock to shares held for a minimum of six months.
9
<PAGE>
The following table sets forth the number of shares acquired on exercise of
stock options in the Company's last fiscal year, the aggregate dollar value
realized on exercise of such options and the number and dollar value of
unexercised options as of August 31, 2000 for the Company's executive officers
named in the Summary Compensation Table above.
Aggregated Option Exercises in Last Fiscal Year and
Fiscal Year End Option Values
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised
Options at In-the-Money Options at
Realized August 31, 2000 (#)(1) August 31, 2000(2)
Shares Acquired Value --------------------------- ---------------------------
Name on Exercise (#) ($) Exercisable Unexercisable Exercisable Unexercisable
---- --------------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Garry O. Ridge -0- $-0- 40,272 33,778 -0- -0-
Thomas J. Tranchina -0- -0- 6,000 10,000 -0- -0-
Graham P. Milner -0- -0- 29,981 12,437 -0- -0-
Michael L. Freeman -0- -0- 19,386 12,164 -0- -0-
William B. Noble -0- -0- 23,439 13,161 -0- -0-
</TABLE>
1 All historical option grant information has been adjusted to account for the
2 for 1 stock split on July 11, 1997.
2 The value of Unexercised In-the-Money Options at August 31, 2000 was
determined based on the difference between the exercise price for such
options and the closing price of $19.375 for the Company's shares as
reported by The Nasdaq Stock Market.
Supplemental Death and Retirement Benefit Plans
Since 1984 the Board of Directors has adopted Supplemental Death Benefit
Plans for certain key employees. Under the Death Benefit Plan agreements, a
participating employee's designated beneficiary or the employee's estate will
receive a death benefit equal to the employee's then current base salary in the
event of death prior to retirement from the Company. No death benefit is payable
if retirement benefits become due upon the employee's retirement under the
Retirement Benefit Plan agreement.
Since 1988 the Board of Directors has adopted Supplemental Retirement
Benefit Plans for certain key employees. Under the Retirement Benefit Plan
agreements, participating employees will receive retirement benefits in the
event of the participant's retirement on or after a designated retirement date.
The annual retirement benefit for participating employees will be equal to
twenty-five percent (25%) of the employee's then current base salary, payable in
quarterly installments over a period of fifteen years.
All benefits under the plans will be subject to payroll taxes and required
withholding for state and federal income taxes as deferred compensation. The
benefits are funded by key man life insurance policies purchased and owned by
the Company. The Board of Directors determines which key employees will
participate in the plans and the amount of benefits payable for each
participant. Outside directors do not participate in the plans.
Based upon current (2001) base salaries, the death benefits and annual
retirement benefits to be provided under the plans to the executive officers
named in the Summary Compensation Table above are set forth below. The
retirement benefit will not be payable unless the executive officer retires with
the
10
<PAGE>
Company on or after reaching the specified retirement age. In such event, the
actual amount of the annual benefit will be dependent upon the executive's then
current annual salary.
<TABLE>
<CAPTION>
Death Annual Retirement Retirement
Name Benefit Benefit Age
---- --------- ----------------- ----------
<S> <C> <C> <C>
Garry O. Ridge $325,000 $81,250 65
Graham P. Milner 174,000 43,500 65
Michael L. Freeman 165,000 41,250 65
William B. Noble -0- 45,000 65
</TABLE>
Employment Agreements
The Company has entered into employment agreements with Mr. Ridge and Mr.
Tranchina for three year terms through August 1, 2002, subject to renewal for
additional three year terms unless otherwise provided by the Board of Directors.
Mr. Ridge will receive an annual base salary of at least $275,000 and Mr.
Tranchina will receive an annual base salary of at least $126,000. Each of the
officers will receive such incentive bonuses as may be awarded from time to time
by the Board of Directors based upon the Company's annually established bonus
formula. In the event of a termination of employment without cause following a
change of control of the Company (defined as the acquisition by tender offer, or
other means of change of ownership, of 15% of the outstanding shares of the
Company by a single entity, group or person), Mr. Ridge and Mr. Tranchina would
be entitled to receive an amount equal to three times their average annual gross
salary, including bonuses, for the five years immediately prior to such
termination of employment. In no event will the payments exceed the limitations
of Internal Revenue Code Section 280G(d)(2) which limit the deductibility of
certain payments to executives upon changes in control.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The compensation philosophy of the Company is to be competitive in the
marketplace to attract, retain, and motivate a highly qualified workforce. The
Company uses compensation surveys, conducted by independent consultants, to
provide data to support the development of competitive compensation plans which
reinforce this philosophy. The Compensation Committee of the Board of Directors
(the "Committee") determines compensation for the CEO and executive officers.
The Committee also serves as the Stock Option Committee under the Company's 1990
Incentive Stock Option Plan. In evaluating the CEO's performance, the Committee
will measure the year's results against the specific goals set forth in the
annual business plan. In addition to financial performance, the Committee
considers factors important to the Company such as ethical business conduct,
environmental responsiveness, and the general overall perception of the Company
by financial and business leaders.
The Committee is responsible for setting and administering the policies
which govern executive compensation and the stock ownership programs of the
Company. The members of the Committee are Daniel W. Derbes (Chairman), Mario L.
Crivello, Jack L. Heckel, Gary L. Luick and Edward J. Walsh.
Compensation of the CEO and the CEO's recommendations for the executive
officers is reviewed annually by the Committee. Changes proposed for executive
officers are evaluated and approved by the Committee on an individual basis. As
management responsibilities increase, a greater portion of compensation is
driven by financial performance measures.
11
<PAGE>
There are four components in the Company's executive compensation program:
i. Base salary
ii. Performance Incentive
iii. Pension and Profit Sharing
iv. Long-term Stock Options
The Committee has determined that compensation for the CEO and other
executive officers should be weighted more heavily in favor of performance
factors. Annual Performance Incentives could range between 0-50% of total cash
compensation based on the level of achievement of the current fiscal year's
business plan goals.
Base Salary
Base salaries for the CEO and executive officers are established at the
beginning of each fiscal year. Detailed position descriptions, scope and
complexity of the position as well as external market factors are used to
determine base salary levels. Independent compensation surveys such as Wyatt
Data Services are the basis for these comparables, and base salary levels are
pegged at the 50-75th percentile for similar companies. The companies included
in these surveys do not necessarily include any of the companies included in the
Peer Group identified with reference to the Stock Performance Graph that follows
this report. Salary changes are based on guidelines established for all
employees using individual performance and comparable adjustments from midpoint
levels for the various job classifications. Mr. Ridge's base salary for fiscal
year 2000 was $295,000. For fiscal year 2001 Mr. Ridge will receive a base
salary of $325,000, an increase of 10.2%.
Performance Incentive
The Performance Incentive is that substantial portion of the annual
compensation for each executive officer that is related to and contingent upon
the individual's contribution and performance and upon the performance of the
Company as a whole. Consideration is also given to the performance of any
business units under his or her management. The Performance Incentive bonus can
range anywhere from 0-50% of total compensation based primarily on the level of
business plan achievement. In this way, the Company seeks to encourage
continuing focus on increasing the Company's revenue and profitability and
stockholder value, while at the same time motivating its executive officers to
perform to the fullest extent of their abilities. Mr. Ridge's Performance
Incentive compensation for fiscal year 2000 was 33.8% of his total cash
compensation.
Pension and Profit Sharing Plans
Since 1963 the Company has maintained tax qualified Pension and Profit
Sharing Plans for the benefit of all full time employees, including executive
officers. The Company's present Plans include a Money Purchase Pension Plan
providing for required contributions for participating employees equal to 10% of
their covered compensation, a Profit Sharing Plan providing for discretionary
contributions which will be generally limited to 5% of covered compensation and
a 401(k) Plan which allows employees to defer up to 6.6% of covered compensation
and provides a matching contribution equal to one-half of the amounts deferred.
The Plans serve to provide Company employees with tax-advantaged retirement
savings and to focus the attention of employees on profits and the effective use
of assets.
12
<PAGE>
Long-Term Stock Options
The Company has employed stock options as a means of providing long-term
compensation to its key employees for many years. Options are granted at the
beginning of each fiscal year to executive officers and other employees based
upon the level of management responsibility. Option grants are not generally
based on prior performance or results of operations. The Company's Stock Option
Plan has been established to:
a. Focus attention on corporate strategic business direction; and
b. Increase ownership and retention in the Company's stock, thereby
aligning the interests of the participant employees with those of the
Company's stockholders.
For fiscal year 2001, subject to stockholder approval, the Board of
Directors granted options to purchase a total of 420,600 shares to 85 company
employees at $20.81 per share on September 26, 2000. In 1997 the Board of
Directors significantly increased the number of employees participating in the
Stock Option Plan. This increase was due to increased employment as well as a
decision to broaden the scope of the Plan to include lower level management
employees. The Board of Directors believes that wider participation will further
enhance employee productivity, loyalty and commitment as well as providing more
employees with an opportunity to benefit from increasing share values.
On September 26, 2000 Mr. Ridge received options to purchase 40,000 shares,
subject to stockholder approval. Options granted in September 1999 to Mr. Ridge
and the executive officers are set forth in the Stock Option Table included
above.
The Committee believes the Company has a unique overall compensation plan
which fulfills current Company philosophy and which historically has been
successful in producing increased stockholder value. Daniel W. Derbes (Chairman)
Mario L. Crivello
Jack L. Heckel
Gary L. Luick
Edward J. Walsh
13
<PAGE>
STOCK PERFORMANCE GRAPH
The following graph compares the cumulative total stockholder return on the
Company's Common Shares with the cumulative total return of a Peer Group of
consumer product companies and the Standard & Poor's 500 Composite Stock Index
(the "S&P 500 Index") for the five fiscal years ending August 31, 2000. The
comparison assumes $100 invested on August 31, 1995 in the Company's Common
Shares and in each of the indices.
COMPARISON OF FIVE-YEAR CUMULATIVE RETURNS
WD-40 Company, a Peer Group and the S&P 500 Index
<TABLE>
<CAPTION>
Year Ended August 31,
1995 1996 1997 1998 1999 2000
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
WD-40 Company 100.00 111.83 142.13 111.27 137.88 115.85
Peer Group 100.00 106.78 146.98 133.57 158.08 126.17
S&P 500 Index 100.00 118.73 167.00 180.51 252.40 293.59
</TABLE>
The Peer Group returns are based upon beginning-of-year market
capitalization weighting of the cumulative returns for the following 14 consumer
product companies: Alberto-Culver Co., Church & Dwight, Inc., Enesco Group,
Inc., Kimball International, Lancaster Colony Corp., La-Z-Boy Chair Co.,
National Presto Industries, Inc., NCH Corp., Oneida Ltd., RPM Inc.-Ohio, Royal
Appliance Manufacturing Co., Scotts Company, Valspar Corp. and Wynn's
International, Inc.
14
<PAGE>
ITEM NO. 2
PROPOSAL TO APPROVE AMENDMENT TO
THE WD-40 COMPANY
1990 INCENTIVE STOCK OPTION PLAN
For more than twenty years, WD-40 Company has maintained stock option plans
to provide long-term compensation benefits to management level employees. The
Stock Option Plans have successfully enhanced long-term stockholder value by
allowing the Company to attract and retain highly qualified employees.
In 1990, the stockholders approved the WD-40 Company 1990 Incentive Stock
Option Plan (the "1990 Plan"). The 1990 Plan was restated in 1994 and in 1997 to
authorize additional shares and to implement other changes. The 1997 amendments
included authority for the issuance of options to non-employee directors. The
1997 restated Plan authorized options to purchase an aggregate of 1,480,000
shares of the Company's common stock. All share information has been adjusted
retroactively to account for the 2 for 1 stock split on July 11, 1997 as
provided for in the Plan. On September 26, 2000, options to purchase 420,600
shares were granted to 85 employees, subject to stockholder approval of this
item. In order to allow the Company to continue the grant of options under the
1990 Plan, the Board of Directors has approved, subject to stockholder approval,
an amendment to the plan (the "Amendment") authorizing the grant of options to
purchase an additional 1,500,000 shares of the Company's common stock. As of
August 31, 2000 and prior to the grant of options for the current fiscal year,
options to purchase 370,491 shares were available for future grants under the
1990 Plan. If the Amendment is approved there will be at least 1,449,891 shares
available for future grants in fiscal year 2002 and later years.
The Amendment is set forth in a Third Amendment and Restatement of the WD-40
Company 1990 Incentive Stock Option Plan.
Summary of the Amendment and the 1990 Plan
Options to purchase an aggregate of 2,980,000 shares of the Company's common
stock may be granted to employees from time to time under the 1990 Plan if the
Amendment is approved. The total number of authorized shares includes all shares
previously granted to employees under the 1990 Plan. The exercise price for
options granted under the plan may not be less than 100% of the fair market
value of the Company's shares on the date of grant. Options to purchase
1,449,891 shares will be available for grant upon approval of the Amendment by
the stockholders, exclusive of options granted on September 26, 2000 as set
forth in the New Plan Benefits table below. Options granted under the 1990 Plan
may be designated as "Nonqualified Stock Options" or "Incentive Stock Options".
Incentive Stock Options are afforded special tax treatment to the holder under
Section 422 of the Internal Revenue Code of 1986 (the "Code").
The 1997 restatement to the Plan included certain conforming amendments
under federal securities laws. Those amendments updated provisions of the 1990
Plan that allow officers and directors to receive and exercise stock options
granted under the 1990 Plan without concern for possible violation of short-
swing trading rules if they have otherwise acquired or disposed of shares within
6 months of receiving or exercising the stock options. The regulations
promulgated by the Securities and Exchange Commission under Section 16 of the
Securities Exchange Act of 1934 (the "1934 Act") were substantially revised
effective August 15, 1996 to more simply exempt employee benefit plan
transactions between companies and their officers and directors from the
short-swing trading prohibitions. The 1990 Plan is
15
<PAGE>
administered by the Board of Directors or a committee of the Board of Directors
of the Company (the "Stock Option Committee"), consisting of two or more
directors who are "Non-Employee Directors" as defined in regulations under the
1934 Act. The Board of Directors or the Stock Option Committee is empowered to
construe and interpret the 1990 Plan, to prescribe, amend and rescind rules and
regulations relating to it, and to make all other determinations necessary or
advisable, in their sole discretion, for administration of the Plan. The Board
of Directors or the Stock Option Committee determines which employees of the
Company or its Subsidiaries will receive options under the 1990 Plan, the number
of shares for which each option is granted, and whether the option is to be
designated as a Nonqualified Stock Option or as an Incentive Stock Option.
Outside Directors are eligible to receive options approved by the full Board of
Directors.
Each option is evidenced by a Stock Option Agreement specifying the terms
and conditions under which the option may be exercised. The 1990 Plan allows the
Board of Directors or the Stock Option Committee to amend an outstanding Stock
Option Agreement with the agreement of the option holder. Such an amendment may
have income tax consequences to the option holder and/or the Company, depending
upon the nature of the changes.
Options granted under the 1990 Plan may not be exercised for one year
following the date of grant. No options may be exercised more than ten years
after the date of grant. Stock Option Agreements will generally provide for the
termination of an option 3 months following termination of the option holder's
employment with the Company. Options may be exercised by delivering a notice of
exercise together with cash or a certified check for the exercise price. In lieu
of cash, an option holder may exercise the option by tendering shares of the
Company's common stock valued for purposes of the exercise at the shares'
current fair market value.
Upon the expiration or other termination of an option, the shares covered
thereby are available for grant of additional options under the 1990 Plan. The
number of shares authorized for issuance under the plan are also increased by
the number of any shares tendered in lieu of cash upon the exercise of an
option. As such, the number of new shares issued by the Company will never
exceed the aggregate of 2,980,000 shares authorized by the 1990 Plan.
Options granted under the 1990 Plan are not transferable except by Will or
under the laws of descent and distribution. The 1990 Plan and options granted
thereunder are subject to customary anti-dilution provisions. Options carry no
dividend or voting rights. The 1990 Plan will terminate on December 31, 2005.
Federal Income Tax Consequences to Option Holders and the Company
There is no tax consequence to the Company or the option holder upon the
grant of either Incentive Stock Options or Nonqualified Stock Options.
Options designated as Incentive Stock Options may be exercised without
recognition of any taxable income provided that the option holder makes no
disposition of the shares within one year of the transfer of the shares to such
option holder. Thereafter, any gain from sale of the shares will be recognized
by the option holder as capital gain rather than ordinary income. The Company
may not claim any deduction for a trade or business expense upon the exercise of
an Incentive Stock Option or upon sale of the shares by the option holder
following the one-year limitation period. If the shares are disposed of within
one year of the transfer of the shares to the option holder (a "disqualifying
disposition"), the option will lose its character as an Incentive Stock Option
and will, subject to certain limitations, be treated as a Nonqualified Stock
Option.
16
<PAGE>
In order to obtain the favorable treatment afforded to Incentive Stock
Options, the option holder must be employed by the Company or by a Subsidiary at
all times from the date of grant through a date which is not more than three
months before the date on which the option is exercised. The three-month limit
is extended to one year in the event of death or in the event of permanent and
total disability as defined in the Code.
In order to qualify an option for Incentive Stock Option treatment, the
Stock Option Agreement must include limitations on the exercisability of the
option such that the aggregate fair market value (determined at the time the
option is granted) of all shares for which Incentive Stock Options become
exercisable in any calendar year does not exceed $100,000. To comply with this
limitation, Incentive Stock Options may provide for delayed exercisability
(vesting) on January 1st of succeeding years following the one year anniversary
of the date of grant as may be necessary. Alternatively, all or part of an
option may be designated as a Non-Qualified Stock Option so that the entire
option will be exercisable one year from the date of grant.
Upon the exercise of a Nonqualified Stock Option, the option holder is
required to recognize ordinary compensation income in the amount of the
difference between the fair market value of the shares on the date of exercise
and the exercise price. Under such circumstances, the Company is required to
report such amount as a compensation expense on its payroll tax returns for
withholding purposes. Provided that proper withholding for income taxes has been
made, the Company is entitled to claim a compensation expense deduction.
Withholding is not required in the event of a disqualifying disposition (sale
within one year of exercise) of an Incentive Stock Option which results in its
treatment as a Nonqualified Stock Option.
Shareholder Vote Required for Approval
Approval of the proposed Third Amendment to the WD-40 Company 1990 Incentive
Stock Option Plan will require the affirmative vote of the holders of a majority
of the shares entitled to vote at the meeting. Abstentions and broker non-votes
are not counted as votes in favor of approval of the 1990 Plan Amendment. The
Board of Directors urges shareholders to vote "FOR" approval of the 1990 Plan
Amendment.
17
<PAGE>
Options Granted September 26, 2000
The following table presents information concerning the grant of Stock
Options under the 1990 Plan to the Company's executive officers named in the
Summary Compensation table on Page 8, all current executive officers as a group
and all employees as a group. Directors who are not employees of the Company
have not received any options under the Plan. All of the options listed were
granted at an exercise price of $20.8125. The closing fair market value of the
Company's common stock as of October 13, 2000 was $21.25 as reported by the
Nasdaq Stock Market.
New Plan Benefits
WD-40 Company 1990 Incentive Stock Option Plan
<TABLE>
<CAPTION>
Percent of Options
Dollar Value Options Granted Granted to All
Name and Principal Position ($)(1) (#)(2) Employees
--------------------------- ------------ --------------- ------------------
<S> <C> <C> <C>
Garry O. Ridge
President and CEO $17,500 40,000 9.5%
Thomas J. Tranchina
Vice President Finance and CFO $ 8,750 20,000 4.75
Graham P. Milner
Senior Vice President, The Americas $ 8,750 20,000 4.75
Michael L. Freeman
Vice President Operations
and Chief Information Officer $ 8,750 20,000 4.75
William B. Noble
Managing Director Europe
WD-40 Company Ltd. (U.K.) $ 8,750 20,000 4.75
All Executive Officers as a Group (7) $70,000 160,000 38.0
All Employees as a Group (85) $184,012 420,600 100.0
</TABLE>
1 The dollar value of options granted was determined based on the difference
between the exercise price of $21.8125 and the closing price for the
Company's shares as reported by The Nasdaq Stock Market for October 13,
2000.
2 All options granted to the executive officers were granted as non-qualified
options.
18
<PAGE>
ITEM NO. 3
RATIFICATION OF INDEPENDENT ACCOUNTANTS
WD-40 Company stockholders will vote to ratify the selection of
PricewaterhouseCoopers LLP as WD-40 Company's independent accountants. A
majority of the votes of the common stock present or represented at the meeting
is required for approval. Broker non-votes will be voted in favor of approval.
PricewaterhouseCoopers LLP acted as the Company's independent public accountants
during the past fiscal year and will continue to act in such capacity during the
current fiscal year. It is anticipated that a representative of
PricewaterhouseCoopers LLP will attend the Annual Meeting of Stockholders, will
have an opportunity to make a statement if he or she desires to do so and will
be available to respond to appropriate questions.
The Company's independent accountants perform audit services (which include
reading filings with the Securities and Exchange Commission as well as quarterly
and annual reports) and tax-related services for the Company Before audit
services are performed, the Audit Committee approves an estimated fee. The
possible effect on the independence of the accountants is considered by the
Audit Committee. There is no direct or indirect understanding or agreement that
places a limit on current or future years' audit fees.
STOCKHOLDER PROPOSALS
Stockholder proposals must be received by the Company not later than July
12, 2001 to be included in the Proxy Statement and form of Proxy for the next
annual meeting.
By Order of the Board of Directors
Harlan F. Harmsen
Secretary
Dated: November 9, 2000
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, STOCKHOLDERS ARE
URGED TO FILL IN, SIGN AND RETURN THE ACCOMPANYING FORM OR FORMS OF PROXY IN THE
ENCLOSED ENVELOPE.
19
<PAGE>
WD-40 COMPANY - 1061 CUDAHY PLACE, SAN DIEGO, CA 92110
<PAGE>
THIRD AMENDMENT AND RESTATEMENT
WD-40 COMPANY
1990
INCENTIVE STOCK OPTION PLAN
Pursuant to the authority granted to the Board of Directors of
WD-40 COMPANY under Paragraph 8 of the WD-40 COMPANY 1990 INCENTIVE STOCK OPTION
PLAN adopted by the Board of Directors on March 28, 1990, restated on September
26, 1994, further restated on September 22, 1997 and approved by the Company's
stockholders on November 25, 1997, said Plan is hereby amended and restated in
its entirety to increase the number of shares authorized for issuance under the
Plan.
This Third Amendment and Restatement shall be effective upon
its approval by the stockholders of the Company within twelve (12) months of its
adoption by the Company's Board of Directors.
1. ESTABLISHMENT AND PURPOSE
The purpose of the Plan is to provide a means whereby
Directors and salaried or key employees of WD-40 COMPANY, a California
corporation (the "Company") or of its subsidiaries (the "Subsidiaries") may be
given an opportunity to purchase common stock of the Company under options which
will be non-qualified or qualify as "incentive stock options" under Section 422
of the Internal Revenue Code. Subsidiaries, for this purpose, shall include
corporations defined as a subsidiary corporation under Section 424 of the
Internal Revenue Code.
-1-
<PAGE>
2. AMOUNT OF STOCK
(a) Options designated as "non-qualified stock
options" or "incentive stock options" may be granted from time to time to
directors and employees of the Company or Subsidiaries to purchase an aggregate
of not more than 2,980,000 shares of the Company's authorized but unissued $.001
par value common stock. If an option is surrendered or for any other reason
ceases to be exercisable in whole or in part, the shares which were subject to
such option but as to which the option had not been exercised shall continue to
be available under the Plan.
(b) The number of shares available under the Plan
shall be increased to the extent of any shares tendered in lieu of cash upon
exercise of an option granted under the Plan, whether such shares are
actually canceled or are retained upon issuance of an appropriate net number
of new shares, the effect on the issuance of additional shares being the same.
(c) The aggregate fair market value (determined at
the time an option is granted) of the stock for which incentive stock options
first become exercisable by any person in any calendar year (under all such
plans of the Company or of its parent or Subsidiaries) shall not exceed
$100,000.
(d) Except as provided in Paragraph 4 of this Plan,
no incentive stock option shall be granted to any person who, immediately before
such option is granted, owns (as defined in Section 424 of the Internal Revenue
Code) stock possessing more than 10% of the total combined voting power or value
of all classes of stock of the Company or of its parent or Subsidiaries.
3. ADMINISTRATION
(a) The Plan shall be administered by the Board of
Directors or a Stock Option Committee (the "Committee") of the Board of
Directors of the Company. The
-2-
<PAGE>
Committee shall consist of two or more directors who are "Non-Employee
Directors" as defined in regulation Section 240.16b-3 promulgated by the
Securities and Exchange Commission under the Securities Exchange Act of 1934.
Subject to the express terms and conditions of the Plan, the Board of Directors
or the Committee shall have full power to construe and interpret the Plan, to
prescribe, amend and rescind rules and regulations relating to it, and to make
all other determinations necessary or advisable, in the sole discretion of the
Board of Directors or the Committee, for its administration.
(b) The Board of Directors or the Committee may from
time to time determine which Directors and employees of the Company or
Subsidiaries shall be granted non-qualified or incentive stock options under
this Plan, and the number of shares for which an option or options shall be
granted to each of them. Options granted to outside directors shall be approved
by a vote of the full Board of Directors.
4. TERMS AND CONDITIONS OF OPTIONS
Each option shall be evidenced by a Stock Option Agreement
executed by the Company and the person to whom such option is granted. Each
Agreement shall specify whether the option is a non-qualified or incentive stock
option. The Agreements shall be subject to the following terms and conditions:
(a) OPTION PRICE. Except as provided in
subparagraph (c), the option price shall be fixed by the Board of Directors or
the Committee and shall be a price at least equal to 100% of the fair market
value of the stock on the day the option is granted; fair market value may be
taken as the previous day's closing price or the mean between the opening bid
and asked price of the stock in the over-the-counter market, as may be
appropriate.
(b) OPTION PERIOD. Except as provided in
subparagraph (c), each option granted under the Plan shall expire on a date
determined by the Board of Directors or the
-3-
<PAGE>
Committee, but, for incentive stock options, not later than ten years from the
date the option is granted. No option shall be exercisable until one year from
the initial grant date.
(c) INCENTIVE STOCK OPTIONS GRANTED TO 10%
STOCKHOLDERS. An incentive stock option may be granted to a stockholder who,
immediately before such option is granted, owns more than 10% of the total
combined voting power or value of all classes of stock of the Company or of its
parent or Subsidiaries, provided that the price of such option is at least 110%
of the fair market value of the stock, and provided further that the option is
not exercisable after five years from the date the option is granted.
(d) ADJUSTMENTS.
(i) In the event of an increase or
decrease in the number of outstanding shares of common stock of the Company
through stock dividends, split-ups, changes in par value and the like, an
appropriate adjustment shall be made in the number of shares and option price
per share of the shares as to which the right to purchase has not been exercised
or has not matured. Such adjustment may be made either by increase in the number
of shares and decrease in the option price per share, or by decrease in the
number of shares and increase in the option price per share, as may be required
to enable the holder of the option to acquire the same proportionate
stockholdings at the same aggregate purchase price. In making such adjustments,
no fractional shares, or scrip certificates in lieu thereof, shall be issued by
the Company, and the holder of the option shall receive only the number of full
shares to which he may be entitled by reason of such adjustment at the adjusted
option price per share.
(ii) Whenever during the term of an option
and prior to the exercise thereof as to all shares at that time subject thereto,
the Company (1) shall offer for sale to holders of its common stock, shares of
common stock or other classes of stock or of other securities of the Company, or
(2) in connection with any transaction shall acquire or shall cause
-4-
<PAGE>
to be issued rights to acquire shares of stock or other securities of any
corporation to or for the benefit of the holders of common stock of the Company,
it will give written notice to the holder of an option of the rights which are
thus to be acquired or issued to or for the benefit of the holders of its common
stock in sufficient time to permit such option holder to exercise the option to
the full extent then possible.
(iii) In the event the Company proposes to
merge or consolidate with another corporation or to sell or dispose of its
assets and business or to dissolve, the Company will give written notice thereof
to the holder of each option in sufficient time to permit him to exercise the
option in full as to any matured options, if such holder should elect to do so,
and to participate in such transaction as a stockholder of the Company. In the
event of a merger or consolidation or sale under which the Company or its
holders of common stock will not acquire stock or other securities of the
continuing, resulting or another corporation in exchange for their shares of
common stock of the Company but shall receive cash in whole or in part, then any
unmatured options shall likewise be deemed to have matured at the date of the
notice of the meeting of stockholders of the Company at which such
consolidation, merger, sale or other transaction is to be considered so that the
option holder will have an opportunity to exercise such option before such
consolidation, merger, sale or other transaction is effective. In either event,
if such options are not exercised, they shall terminate and expire.
(e) NONTRANSFERABILITY OF OPTIONS. An option shall
not be transferable otherwise than by Will or the laws of descent and
distribution, and an option may be exercised during the lifetime of the employee
only by him.
(f) OTHER PROVISIONS AND AMENDMENTS. The option may
contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Board of Directors or the Committee and
incentive stock options shall include such
-5-
<PAGE>
provisions and conditions as may be necessary to qualify the option as an
"incentive stock option" under Section 422 of the Internal Revenue Code. The
Board of Directors or the Committee shall have authority to amend any
outstanding option to include such terms, provisions and conditions not
inconsistent with the Plan as may be agreed to by the optionee.
5. EXERCISE OF OPTIONS
(a) An option may be exercised with respect to all or
any part of the shares then subject to exercise only by delivering to the
Company written notice of exercise, specifying the number of such shares as to
which the option is so exercised and accompanied by cash or a certified or
cashier's check, payable to the order of the Company for an amount in lawful
money of the United States equal to the option price of such shares.
(b) In lieu of cash, an optionee may exercise his or
her option by tendering to the Company shares of the common stock of the
Company, owned by him or her for not less than six (6) months, and having a fair
market value equal to the cash exercise price applicable to the option(s) being
exercised, with the fair market value of such stock to be determined in such
appropriate manner as may be provided for by the Board of Directors or the
Committee.
(c) The Stock Option Agreement shall require certain
representations, warranties or assurances, or an undertaking by an optionee in
the event issuance of the shares might require filing or registration under the
Securities Act of 1933 or the Blue Sky laws of any state or any other law
regulating the issuance of securities.
6. TAX REPORTING AND WITHHOLDING
The Company shall comply with all reporting and withholding
requirements applicable to the exercise of options under the Internal Revenue
Code and regulations thereunder.
-6-
<PAGE>
7. PROCEEDS FROM SALE OF STOCK
Proceeds from the sale of stock pursuant to the options
granted under the Plan shall be added to the general funds of the Company.
8. SUSPENSION, AMENDMENT OR TERMINATION OF THE PLAN
The Board of Directors may at any time amend, suspend or
terminate the Plan. Unless the Plan shall theretofore have been terminated by
the Board of Directors, the Plan shall terminate on December 31, 2005. No option
may be granted during such suspension or after such termination. The termination
of the Plan shall not, without the consent of the optionee, alter or impair any
rights or obligations under any option theretofore granted under the Plan.
9. DELIVERY OF SHARES SUBJECT TO DELAYS
The issuance of each option under the plan and the issuance
and delivery of shares of stock pursuant to the exercise of any option under the
Plan shall be subject to and in compliance with the laws of any state or other
governmental authority applicable thereto, the Board of Directors being hereby
authorized to cause to be prepared, filed and presented on the Company's behalf
to any governmental official, agency or tribunal all such applications or other
instruments or papers and to maintain any and all proceedings as shall be
required to cause the issuance to the Company of a permit or other authorization
to issue or deliver any such option of shares. Neither the Company nor any
officer, director or employee shall be liable for any delay in issuance or
delivery of any option or shares pending the filing of any such application,
instrument or papers or the grant of a permit or other authorization to enable
such issuance or delivery to be made.
IN WITNESS WHEREOF, the Plan is amended and restated this 26th
day of September, 2000.
WD-40 COMPANY
By /s/ GARRY O. RIDGE
----------------------------------------
Garry O. Ridge, President
Attest:
/s/ JOHN B. SIDELL
----------------------------------------
John B. Sidell, Assistant Secretary
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<PAGE>
PROXY WD-40 COMPANY PROXY
1061 Cudahy Place
San Diego, CA 92110
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, revoking previous proxies for such stock, hereby appoints
Daniel W. Derbes and Harlan F. Harmsen, and each of them, proxies of the
undersigned, with power of substitution to each, to vote all stock of WD-40
Company which the undersigned is entitled to vote at the Annual Meeting of
Stockholders of the Company to be held at the Mission Valley Doubletree Hotel,
7450 Hazard Center Drive, San Diego, California 92108, on Tuesday, December 12,
2000 at 2:00 p.m. and at any adjournments thereof.
Please mark, sign, date and return
the proxy card promptly using the
enclosed envelope
<PAGE>
WD-40 COMPANY
PLEASE MARK OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY.
MANAGEMENT RECOMMENDS A VOTE FOR THE FOLLOWING ITEMS:
<TABLE>
<S> <C> <C> <C>
1. ELECTION OF DIRECTORS: Nominees: FOR ALL WITHHOLD FOR ALL
01-M.L. Crivello, 02-D.W. Derbes, FOR ALL EXCEPT
03-H.F. Harmsen, 04-J.L. Heckel,
05-G.L. Luick, 06-K.E. Olson,
07-G.O. Ridge, 08-G.C. Schleif,
09-E.J. Walsh (INSTRUCTIONS: To withhold
authority to vote for any nominee(s), write that
nominee's name on the space provided below.)
------------------------------------------------
------------------------------------------------
FOR AGAINST ABSTAIN
2. To approve an amendment to the WD-40
Company 1990 Incentive Stock Option Plan.
3. To ratify the selection of Pricewaterhouse- FOR AGAINST ABSTAIN
Coopers LLP as the Company's independent
accountants for fiscal year 2001.
</TABLE>
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR PROPOSALS 1, 2 AND 3.
Dated: , 2000
-----------------
Signature:
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Title:
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Important: Please sign exactly as name appears on
this proxy. When signing as attorney, executor,
guardian, corporate officer, etc., please indicate
full title.
