<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
(Amendment No. )
FILED BY THE REGISTRANT /X/
FILED BY A PARTY OTHER THAN THE REGISTRANT / /
CHECK THE APPROPRIATE BOX:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
REXEL, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / 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:
------------------------------------------------------------------------
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:
------------------------------------------------------------------------
<PAGE>
REXEL, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
------------------------
NOTICE IS HEREBY GIVEN that the 129th Annual Meeting of Stockholders of
Rexel, Inc. (the "Company") will be held at The Metropolitan Club, One East 60th
Street, New York, New York, at 11:00 A.M. (New York City time) on Friday, May
17, 1996, for the following purposes:
- to elect three members of the Board of Directors of the Company; and
- to transact such other business as may properly come before the meeting or
any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on Friday, March 29,
1996, as the record date for the determination of stockholders entitled to
notice of and to vote at the meeting.
If you will be unable to attend the meeting, you are respectfully requested
to sign and return the accompanying proxy in the enclosed envelope.
By Order of the Board of Directors,
JON O. FULLERTON
Secretary
April 19, 1996
<PAGE>
REXEL, INC.
PROXY STATEMENT
This proxy statement is furnished to the stockholders of Rexel, Inc.
(hereinafter referred to as the "Company") in connection with the solicitation
of proxies for the Annual Meeting of Stockholders to be held on May 17, 1996.
The address of the Company's principal executive office and the Company's
mailing address is 150 Alhambra Circle, Suite 900, Coral Gables, FL 33134, and
the telephone number of its principal executive office is (305) 446-8000. This
proxy statement and the enclosed proxy are being sent to stockholders commencing
on or about April 19, 1996.
The enclosed proxy is solicited by the Board of Directors of the Company.
Execution of the proxy will not affect a stockholder's right to attend the
Annual Meeting and to vote in person or to revoke the proxy. A proxy may be
revoked at any time before it is exercised by written notice of revocation
delivered to the Secretary of the Company.
The Company will bear the cost of the solicitation of proxies, including the
charges and expenses of brokerage firms and others for forwarding solicitation
material to beneficial owners of stock. In addition to the use of the mails,
proxies may be solicited by personal interview, telephone or telecopy.
VOTING SECURITIES OUTSTANDING
The only outstanding class of voting securities of the Company is its Common
Stock, of which there were 25,649,790 shares outstanding at February 5, 1996.
Each share is entitled to one vote.
Only holders of Common Stock of record at the close of business on March 29,
1996 (the "Record Date"), will be entitled to vote at the Annual Meeting of
Stockholders.
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following persons were known by the Company to be the beneficial owners
of more than five percent of the outstanding Common Stock as of February 5, 1996
(based on the most recently available Schedule 13G and 13D SEC filings):
<TABLE>
<CAPTION>
PERCENT
NAME AND ADDRESS OF
OF BENEFICIAL OWNER SHARES OWNED CLASS
- ---------------------------------------------------- --------------- ------
<S> <C> <C>
Rexel, S.A. 7,082,987(1)(2) 27.6%
26, rue de Londres,75009
Paris, France
International Technical 4,636,994(1) 18.1%
Distributors, Inc. ("ITD")
301 46th Court
Meridian, Mississippi 39305
</TABLE>
- ------------------------
(1) Reported in an amended Schedule 13D, dated May 27, 1995, that Pinault --
Printemps -- Redoute S.A. ("Pinault"), by virtue of its control of Rexel,
S.A. and, through Rexel, S.A., ITD, may be deemed to be the indirect
beneficial owner of the shares of Common Stock held by Rexel, S.A. and ITD,
and may be deemed to share power to vote or dispose of such shares with such
companies. Further reported that as a result of the relationship among
Pinault, Rexel, S.A. and ITD, Rexel, S.A. and ITD may be deemed to share
power to vote or dispose of the shares of Common Stock held directly by each
of them with Pinault. Previously reported, in Schedule 13D, dated November
25, 1992, that Rexel, S.A. and Pinault may be deemed to share the power to
direct the vote or disposition of the shares of Common Stock held directly
by ITD with Robert Merson, a director and minority shareholder of ITD and an
officer of the Company, and that pursuant to a shareholders' agreement among
Mr. Merson, Rexel, S.A. and ITD, ITD may not sell, pledge, assign or
otherwise dispose of any shares of the Common Stock without Mr. Merson's
approval (except as may otherwise be provided).
(2) Rexel, S.A. and Pinault each filed three late reports on Form 4, reporting a
total of 13 transactions.
2
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
As of February 5, 1996, shares of Common Stock were beneficially owned by
directors and nominees for directors, by the executive officers required to be
listed in the Summary Compensation Table below (see "Executive Compensation"),
and by all directors and executive officers as a group, as follows:
<TABLE>
<CAPTION>
PERCENT OF
NAME SHARES OWNED(1) CLASS(2)
- ------------------------------------------------------------ --------------- ----------
<S> <C> <C>
Jules Altshuler 10,500 *
Frederic de Castro 4,000 *
John B. Fraser 7,000 *
Jon O. Fullerton 30,500 *
R. Gary Gentles 4,000 *
Allan M. Gonopolsky 27,811 *
Steven M. Hitt 13,309 *
Austin List 6,369 *
Eric Lomas 35,000 *
Robert M. Merson 99,135(3) *
Gerald E. Morris 5,000 *
Nicolas Sokolow 4,000 *
Alain C. Viry 158,077 *
Serge Weinberg 5,000 *
All Directors and Executive Officers
as a Group 409,701(4) 1.6%
<FN>
- ------------------------
* Less than 1%.
(1) The persons included in the table had sole voting and investment power with
respect to shares reported as beneficially owned, except as otherwise
indicated in this and the following notes. With respect to each of Messrs.
de Castro, Fraser, Gentles, List, Lomas, Morris, Sokolow and Weinberg,
includes options to purchase 4,000 shares (34,000 shares in the case of Mr.
Lomas) of Common Stock which are exercisable within 60 days of February 5,
1996. With respect to Messrs. Altshuler, Fullerton, Gonopolsky, Hitt,
Merson and Viry, includes options to purchase, respectively, 10,000,
30,000, 6,000, 6,000, 48,000 and 154,000 shares of Common Stock which are
exercisable within 60 days of February 5, 1996. With respect to Messrs.
Gonopolsky, Hitt, Merson and Viry, includes, respectively, 21,811, 4,309,
1,035, and 77 shares of Common Stock held under the Company's Section
401(k) Savings Plan as of December 31, 1995, the most recent date for which
such information is available. Voting power with respect to such shares is
directed by the participants, or, in the absence of such direction, voted
in the best interests of the trust, as determined by the Trustee.
(2) Percentages are calculated by dividing (x) the number of shares in the
"Shares Owned" column by (y) the sum of the number of shares of Common
Stock outstanding as of February 5, 1996 and the number of shares which a
particular owner (or group of owners) has a right to acquire within 60 days
of such date.
</TABLE>
3
<PAGE>
<TABLE>
<S> <C>
(3) Does not include 4,636,994 shares of Common Stock owned by ITD, of which
Mr. Merson is a vice president and director and in which he owns a 12.96%
interest. Mr. Merson disclaims beneficial ownership of such shares.
(4) Includes options to purchase 316,000 shares of Common Stock which are
exercisable within 60 days of February 5, 1996. Also includes 27,232 shares
of Common Stock held under the Company's 401(k) Savings Plan as of December
31, 1995, the most recent date for which such information is available, as
to which voting power is directed by the participants, or, in the absence
of such direction, voted in the best interests of the trust, as determined
by the Trustee.
</TABLE>
ELECTION OF DIRECTORS
The Company's Certificate of Incorporation provides for the classification
of the Board of Directors into three classes (Class I, Class II and Class III).
At the time of this year's Annual Meeting of Stockholders, the Board will
consist of nine directors.
At this year's Annual Meeting, three Class I directors are to be elected to
serve for three-year terms expiring at the 1999 Annual Meeting. The remaining
six directors in Classes II and III were previously elected by stockholders and
will continue to serve their terms of office, which will expire at the Annual
Meetings to be held in 1997 and 1998, respectively.
In connection with the acquisition by Rexel, S.A. of 30% of the outstanding
Common Stock from the Company in November 1992 and of additional Common Stock
from the Company in March 1994 raising its ownership to 40%, Rexel, S.A. was
granted the right to nominate certain directors pursuant to the terms of the
Investment Agreement between Rexel, S.A. and the Company (the "Investment
Agreement"). Messrs. de Castro, Lomas, Morris, Viry and Weinberg were previously
nominated by Rexel, S.A. pursuant to the Investment Agreement. The Investment
Agreement expired December 31, 1994. The three nominees for election as Class I
directors were nominated by the Nominating Committee of the Board of Directors.
If any nominee becomes unavailable for any reason or if a vacancy should
occur before the election (which events are not anticipated), the shares
represented by the accompanying proxy may be voted for such other person as may
be determined by the holders of such proxies.
Directors are elected by a plurality vote. Under the Company's Certificate
of Incorporation and By-Laws and under New York law, abstentions and broker
non-votes will not have the effect of votes in opposition to a nominee. The
Board of Directors of the Company recommends that stockholders vote FOR each
nominee listed below.
4
<PAGE>
The following table sets forth information with respect to each nominee for
election as a director of the Company:
<TABLE>
<CAPTION>
NAME OF NOMINEE; YEAR TERM
POSITIONS AND OFFICES WOULD EXPIRE DIRECTOR PRINCIPAL OCCUPATIONS DURING
WITH COMPANY AGE AND CLASS SINCE LAST FIVE YEARS; OTHER DIRECTORSHIPS
- --------------------- --- ------------ -------- ----------------------------------------------------------------------
<S> <C> <C> <C> <C>
R. Gary Gentles 47 1999 1993 President, Blue Circle America (cement production) (January 1995 to
Director Class I present); Executive Vice President and President Cement Group of
Lafarge Corporation (cement production) (November 1992 to 1994);
President and General Manager of Platres Lafarge L'Isle-sur-Sorgue
(September 1990 to November 1992); President -- Northeastern Region
of Lafarge Canada, Inc. and Senior Vice President of Lafarge
Corporation (February 1989 to August 1990); director of the Portland
Cement Association.
Gerald E. Morris 63 1999 1994 President, Intalite International N.V. (manufacturing and marketing of
Director Class I commercial ceilings) (1968 to present); Chairman of the Board of
Alumet Building Products Inc. (manufacturers of building products)
(1995 to present); President, Morris & Arndt Associates, Inc.
(investment banking) (1988 to present); director of Beacon Trust
Company; director of Tivoli Industries Inc. (manufacturers of
lighting equipment).
Serge Weinberg 45 1999 1992 Chairman of the Executive Board of Pinault -- Printemps -- Redoute
Director; Vice Class I (the French leader in multi-distribution) (July 1995 to present);
Chairman of the Chairman of the Board of Directors and Chief Executive Officer of La
Board Redoute (the French leader in mail order distribution) (July 1995 to
present); Chairman of the Board of Directors and Chief Executive
Officer of FNAC (a leading French distributor of entertainment
products and leisure products) (July 1995 to present); Chairman of
the Supervisory Board of Conforama (France's foremost multi-line
distributor of home appliances and furnishings) (July 1995 to
present); Chairman and Chief Executive Officer of Rexel, S.A.
(electrical parts and supplies distribution) (1990 to present);
Managing Director of Pallas Finance (corporate finance) (1987 to
1990).
</TABLE>
5
<PAGE>
The following table sets forth information with respect to those incumbent
directors whose terms will continue after the Annual Meeting:
<TABLE>
<CAPTION>
NAME OF DIRECTOR; YEAR TERM
POSITIONS AND OFFICES EXPIRES AND DIRECTOR PRINCIPAL OCCUPATIONS DURING LAST FIVE YEARS;
WITH COMPANY AGE CLASS SINCE OTHER DIRECTORSHIPS
- --------------------- --- ------------ -------- ----------------------------------------------------------------------
<S> <C> <C> <C> <C>
Frederic de Castro 38 1997 1994 Chief Financial Officer, Rexel, S.A. (electrical parts and supplies
Director Class II distributor) (April 1992 to present); Treasurer, Recticel
(manufacturer of polyurethane) (August 1990 to March 1992); head of
staff of the chief executive officer of Societe General de Belgique
(industrial holding company) (March 1989 to August 1990).
John B. Fraser 61 1997 1988 President, Geneva Financial Corp. (investment banking) (July 1994 to
Director Class II present); Managing Director, Citibank N.A. (investment banking) (June
1987 to June 1994); director of Worldtex, Inc. (covered yarn
manufacturing).
Austin List Director 73 1998 1981 Vice Chairman and director of Strahl & Pitsch, Inc. (refiner of
Class III natural waxes) (prior to 1989 to present), Chief Executive Officer
and director of Golding Industries (textile printing) (October 1993
to December 1994); Senior Vice President and director of Johnston
Industries, Inc. (manufacturers of industrial textile fabrics)
(before 1988 to October 1993); director of Worldtex, Inc.; director
and Chairman of the American-Turkish Council.
Eric Lomas Director; 49 1997 1992 President of Hill Thompson Group Ltd. (investment banking) (1989 to
Chairman of the Class II present); co-head of investment banking, Gruntal & Co. (investment
Board banking) (1985 to 1989); director of Goodmark Foods.
Alain C. Viry 47 1998 1992 President and Chief Executive Officer of the Company (March 1994 to
Director; President Class III present); Executive Vice President of Rexel, S.A. (electrical parts
and Chief Executive and supplies distribution) (1991 to 1994); Vice President of Finances
Officer and Communication of Rexel, S.A. (1981 to 1991).
Nicolas Sokolow 46 1998 1994 Partner, Cabinet, Sokolow, Dunaud, Mercadier & Carreras (law firm)
Director Class III (1994 to present); Partner, Coudert Brothers (law firm) (1981 to
1994).
</TABLE>
6
<PAGE>
COMMITTEES AND MEETINGS
The Company has standing Executive, Audit, Nominating and Executive
Compensation Committees of the Board of Directors. The Executive Committee may
exercise the powers of the Board of Directors (with certain statutory
exceptions) between meetings of the Board. The Audit Committee reviews
accounting matters with Company management and discusses accounting matters with
the Company's independent accountants in connection with the annual audit. The
Nominating Committee considers and recommends nominees for election to the
Company's Board of Directors. The Executive Compensation Committee reviews
compensation matters, including adoption and implementation of benefit plans,
and takes action or makes recommendations with respect thereto. During the 1995
fiscal year, the Executive Committee, composed of Messrs. Gentles, Viry and
Weinberg, held no meetings, the Executive Compensation Committee, composed of
Messrs. Fraser, List and Lomas, (through February 28, 1995) and Morris (after
February 28, 1995) held two meetings, the Nominating Committee, composed of
Messrs. Gentles, Viry and Weinberg, held one meeting, the Audit Committee,
composed of Messrs. Fraser, List and Morris, held five meetings, and the
Company's Board of Directors held seven meetings.
COMPENSATION OF OUTSIDE DIRECTORS
Non-employee directors (other than Mr. Lomas and employees of Rexel, S.A.)
are paid a fee of $1,333 per month and an additional $900 for each meeting
attended. Mr. Lomas is paid $75,000 per year for his services as Chairman of the
Board of Directors of the Company. The Company does not pay any fees to
directors who are employees of Rexel, S.A. (currently Messrs. Weinberg and de
Castro) in connection with their service as directors of the Company, but
reimburses them for their reasonable out-of-pocket expenses incurred in
connection with attending meetings of the Board of Directors of the Company and
its committees.
Each director of the Company has entered into an Indemnity Agreement with
the Company, which provides that the Company will indemnify each such person to
the fullest extent permitted by law for losses arising in connection with their
service as a director or officer of the Company.
The Company has a retirement plan for directors pursuant to which they are
entitled, upon leaving the Board of Directors for any reason other than removal
for cause, to $1,333 per month, the retainer paid by the Company to active
directors (excluding meeting and committee fees) as of the date of the 1995
annual meeting of stockholders. Such payments will be made for a period equal to
the retired director's service on the Board (excluding periods during which he
also was an employee of the Company) through the date of the 1995 annual meeting
of stockholders, subject to termination upon the death of the director. A
retired director receiving payments under the plan is required to be available
for consultation with officers of the Company upon their request.
Each director of the Company other than one who is an officer or employee of
the Company or an entity in which the Company owns at least a 20% interest (an
"Outside Director") is entitled to receive stock options under the Company's
1988 Stock Incentive Plan (the "Plan"). Each person who was an Outside Director
at the close of the 1993 Annual Meeting of Stockholders was granted, as of the
date of such meeting, a non-qualified stock option to purchase 10,000 shares of
Common Stock, and the Plan provides that each person who subsequently becomes an
Outside Director will be granted a similar option as of the date of such
person's election to the Board of Directors (an "Initial Option"). At the close
of each annual meeting of stockholders commencing with the 1995 annual meeting
(or in
7
<PAGE>
the case of a person who subsequently becomes an Outside Director, with the
annual meeting following the grant of his Initial Option), if the Company's
earnings per share for the immediately preceding fiscal year exceed 110% of the
Company's earnings per share for the fiscal year prior thereto, each Outside
Director other than the Chairman of the Board and any employee of Rexel, S.A.
will be granted an option to purchase 2,500 shares of Common Stock and any
Outside Director (other than a Rexel, S.A. employee) who served as Chairman of
the Board for the preceding year will be granted an option to purchase 5,000
shares of Common Stock (which grant shall be pro rated for service of less than
a full year as Chairman of the Board) (each such option being referred to as an
"Annual Option").
The option price for both Initial and Annual Options is equal to the fair
market value of the Common Stock on the date of the option grant, and may be
paid in cash or shares of Common Stock which have been owned by the optionee for
at least six months (with such shares valued based on the fair market value of
the Common Stock on the date of option exercise). The option price for the
Initial Options granted in 1993 was $6.5625, for options granted to Messrs. de
Castro and Morris on March 1, 1994, was $8.0625 and for the option granted to
Mr. Sokolow on March 18, 1994, was $7.25. An Initial Option becomes exercisable,
in whole or in part, in 20% increments on each of the first five anniversaries
of the date following the date of grant, provided the optionee is a director of
the Company on such date. Each Annual Option becomes fully exercisable, in whole
or in part, on the last business day before the annual meeting which follows the
grant of such option, provided the optionee is a director of the Company on such
date. Each option will expire ten years from the date of its grant, subject to
earlier termination upon termination of the optionee's service as a director.
However, if the optionee dies during his or her period of service as a director,
the optionee's legal representative has the right to exercise the option for a
period of twelve months after the optionee's death, even if such option would
otherwise have expired earlier. An option exercised after termination of service
can only be exercised to the extent it was exercisable at the time of such
termination of service. Stock options granted to Outside Directors are not
transferable except by will or by the laws of descent and distribution.
Each option granted to an Outside Director is granted in tandem with a
limited stock appreciation right which entitles the optionee to elect to receive
within 60 days following the occurrence of a Change of Control (as defined in
the Plan), in lieu of exercising the option, a payment equal to the product of
the number of shares as to which the stock appreciation right is exercised
multiplied by the excess of the Change of Control Price (as defined in the Plan)
over the exercise price of the related option. See "Executive Compensation --
Change of Control Provisions" for the definition of "Change of Control" under
the Plan.
On March 1, 1995 the Executive Compensation Committee granted Mr. Lomas an
option to purchase 30,000 shares of Common Stock at an exercise price of
$6.3125, its fair market value on the date of grant. The option is exercisable
immediately and expires on February 8, 2005.
EXECUTIVE COMPENSATION
The following table sets forth information concerning compensation of the
Chief Executive Officer of the Company, the four most highly compensated
executive officers of the Company other than the CEO serving as executive
officers at the end of 1995 and an employee of a subsidiary of the Company who
would have been included among the four most highly compensated executive
officers but was not serving as an executive officer at the end of 1995.
8
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
--------------
ANNUAL COMPENSATION SECURITIES
UNDERLYING
---------------------- OPTIONS/SARS ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY ($) BONUS ($) (#) COMPENSATION ($)
- ----------------------------------------------------------- --------- ---------- ---------- -------------- ----------------
<S> <C> <C> <C> <C> <C>
Alain C. Viry, 1995 $310,000 $191,240 50,000 $ 5,006(1)
President and Chief Executive Officer 1994 $237,500 $ 75,000 100,000 36,844
Robert M. Merson, 1995 230,000 172,500 30,000 8,560(3)
Senior Vice President; President of Eastern Region 1994 200,000 100,000 None 7,024
1993 200,000 65,434 70,000 4,001
Jules Altshuler, 1995 170,000 170,000 10,000 8,560(3)
President of Midwest Division(2) 1994 147,000 202,000 None None
Jon O. Fullerton, 1995 175,000 98,750 None 28,774(5)
Vice President, General Counsel and Secretary(4) 1994 100,038 25,000 30,000 20,177
Steven M. Hitt, 1995 162,000 102,000 30,000 47,297(6)
Vice President and Chief Financial Officer 1994 152,500 168,250 None 32,522
Allan M. Gonopolsky, 1995 100,000 40,000 None 37,142(7)
Vice President and Corporate Controller 1994 106,666 30,000 None 14,407
1993 115,000 35,000 10,000 None
</TABLE>
- ------------------------
(1) Includes $1,493 in Company contributions under a defined contribution plan
and $3,513 that the Company paid in reimbursement of relocation expenses.
(2) Ceased to be an executive officer on May 12, 1995, but continued as
President of the Midwest Division.
(3) Reflects Company contributions under a defined contribution plan.
(4) Mr. Fullerton became an executive officer of the Company on July 26, 1994.
Information for 1994 is for the period June 1 through December 31, 1994.
(5) Includes $5,550 in Company contributions under a defined contribution plan
and $23,224 that the Company paid in reimbursement of relocation expenses.
(6) Includes $8,560 in Company contributions under a defined contribution plan
and $38,737 that the Company paid in reimbursement of relocation expenses.
(7) Includes $8,373 in Company contributions under a defined contribution plan
and $28,769 that the Company paid in reimbursement of relocation expenses.
9
<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- ----------------------------------------------------------------------------------------
NUMBER OF
SECURITIES % OF TOTAL POTENTIAL REALIZABLE VALUE
UNDERLYING OPTIONS/ AT ASSUMED ANNUAL RATES OF
OPTIONS/ SARS GRANTED EXERCISE STOCK PRICE APPRECIATION
SARS TO EMPLOYEES OR BASE FOR OPTION TERM (4)
GRANTED IN FISCAL PRICE ($/ EXPIRATION DATE --------------------------
NAME (#) (1) YEAR SH)(2) (3) 5% ($) 10% ($)
- ------------------------------ ---------- ------------ ---------- ------------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Alain C. Viry 50,000 12.53% $ 7.25 February 8, 2005 $ 126,169 $ 415,623
Robert M. Merson 30,000 7.52 6.00 February 8, 2005 113,201 286,874
Jules Altshuler 10,000 2.51 6.00 February 8, 2005 37,734 95,625
Steven M. Hitt 30,000 7.52 6.00 February 8, 2005 113,201 286,874
All stockholders (5) N/A N/A N/A N/A 90,991,565 230,590,287
<FN>
- ------------------------------
(1) With respect to Mr. Viry, the option is exercisable immediately. With
respect to Messrs. Merson, Altshuler and Hitt, the options will become
exercisable in 20% installments on each of the first five anniversaries of
the date of grant, provided the optionee is still employed on such date.
The options include a limited SAR exercisable only in the event of a
"Change of Control" of the Company. See "-- Change of Control Provisions"
below.
(2) The market price of the Company's common stock on the date of grant was
$6.00.
(3) The stock option is subject to termination prior to its expiration date in
the event of a termination of employment.
(4) This information is provided pursuant to the rules of the Securities and
Exchange Commission. Using $6.00, the market price of the Company's common
stock on the date of the option grant, the 5% and 10% rates of appreciation
would result in per share prices of $9.77 and $15.56, respectively at the
end of the 10-year option term. This presentation is not a prediction of
possible future prices of the Company's common stock.
(5) For "All Stockholders", the potential realizable value is calculated from
$6.00, the market price of the Company's common stock on the date of the
option grant, and the 24,114,138 outstanding shares of Company common stock
on such date.
</TABLE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES
(1)
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE MONEY OPTIONS/SARS
OPTIONS/SARS AT FY-END AT FY-END
---------------------------- --------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------------------------- ----------- --------------- ----------- -------------
<S> <C> <C> <C> <C>
Alain C. Viry......................... 154,000 6,000 $1,040,250 $ 41,625
Robert M. Merson...................... 28,000 72,000 190,750 511,125
Jules Altshuler....................... 8,000 22,000 55,000 157,500
Jon O. Fullerton...................... 30,000 None 210,000 None
Steven M. Hitt........................ None 30,000 None 225,000
Allan M. Gonopolsky................... 4,000 6,000 27,250 40,875
</TABLE>
- ------------------------
(1) No options were exercised by the executive officers named in the table in
1995.
10
<PAGE>
RETIREMENT PLANS
Prior to July 1994, the Company maintained a non-contributory defined
benefit retirement plan, under which eligible employees were entitled at normal
retirement age of 65 to an annual retirement benefit equal to 1 1/4% of their
earnings for each year of service up to the maximum earnings subject to Social
Security withholding for that year, and 1 1/2% of all earnings for each year of
service in excess of such amount, subject to an earnings limitation imposed
under the Internal Revenue Code for years beginning 1989. Effective as of July
1994, in connection with the disposition of the Company's apparel division, the
Company transferred the assets and liabilities of this plan to the purchaser of
the apparel division. As a result of the transfer, employees who remained with
the Company ceased accruing benefits under the plan. The estimated annual
retirement benefits payable at age 65 to the executive officers named in the
Summary Compensation Table above are as follows: to Mr. Gonopolsky, $19,189
(based on earnings and service to the date of plan transfer); Messrs. Viry,
Merson, Altshuler, Fullerton and Hitt do not participate in this plan.
Mr. Altshuler was a participant in the Retirement Plan for the
Non-Bargaining Employees of Sacks Electrical Supply Company. Benefits under the
plan were frozen as of December 31, 1994 and the plan was terminated effective
February 22, 1995. Mr. Altshuler's annual benefit payable at age 65 under the
annuity purchased for him upon termination of the plan is $7,632.
EMPLOYMENT CONTRACTS
Mr. Viry has a contract with the Company providing for services in a senior
executive capacity for a three-year term expiring March 1997, which renews
automatically for successive one-year terms. The contract may be terminated by
the Company or Mr. Viry upon certain specified notice periods ranging from six
months to immediately, depending on the circumstances. The contract provides for
a minimum salary of $300,000 per annum and for bonuses as approved by the
Executive Compensation Committee in accordance with the incentive plan then
applicable to executive officers of the Company.
Mr. Altshuler has a contract with a subsidiary of the Company for a term
ending April 1996, subject to earlier termination under certain circumstances,
at a minimum annual salary of $147,000. His contract provides for a bonus based
on the results of such subsidiary, but beginning in 1995 his bonus was based on
the results of the Midwest Division.
Mr. Fullerton has a contract with the Company to serve as General Counsel at
a base salary of no less than $170,000 per annum. His contract provides for a
bonus in accordance with the bonus plan applicable to executive officers of the
Company, subject to a minimum bonus of three times his monthly salary if the
Company meets its overall performance goals. The contract is subject to
termination by either party upon 30 days' notice. Upon termination by the
Company, Mr. Fullerton is entitled to severance pay equal to six months' salary.
The contract also provides for deferred compensation of $3,000 per month for a
period of 10 years commencing 30 days after termination of employment, which
right would become fully vested May 31, 2002 (and vested pro rata if termination
occurs prior to that date).
Mr. Gonopolsky has a contract with the Company to serve as Controller at a
base salary of no less than $95,000 per annum. His contract provides for a bonus
in accordance with the bonus plan applicable to executive officers of the
Company. The contract also froze the benefits of Mr. Gonopolsky under the
Company's supplemental retirement plan (which has been terminated), with the
result that Mr. Gonopolsky is entitled to annual supplemental retirement
benefits of $15,000 per year for 10 years
11
<PAGE>
following his retirement. The contract is subject to termination by either party
upon 60 days' notice. Upon termination by the Company, Mr. Gonopolsky is
entitled to severance pay equal to six months' salary, plus an additional three
months' salary if he has diligently sought employment but found none within six
months after termination.
Mr. Hitt has a contract with the Company to serve as Chief Financial Officer
at a base salary of no less than $160,000 per annum. His contract provides for a
bonus in accordance with the bonus plan applicable to executive officers of the
Company. The contract is subject to termination by either party upon 30 days'
notice. Upon termination by the Company, Mr. Hitt is entitled to severance pay
equal to twelve months' salary.
Mr. Merson has a contract with the Company to serve as president and chief
executive officer of Southern Electric Supply Company, Inc., a subsidiary of the
Company ("SES"), and to serve as a Senior Vice President and a member of the
Office of the President of the Company. The agreement has a term continuing
through November 12, 1997, subject to (i) termination by either party upon one
year's notice and (ii) immediate termination by the unanimous vote of all the
members of the Executive Committee of the Board of Directors of the Company. Mr.
Merson's contract provides for a base salary of no less than $200,000 per annum
and a bonus in accordance with the bonus plan applicable to executive officers
of the Company. Mr. Merson is required not to compete with the Company for a
period of three years after the termination of his employment with the Company,
and if Mr. Merson's employment is terminated on one year's notice or upon
immediate notice approved by the Executive Committee of the Company, the Company
will pay Mr. Merson $3,333.33 per month during such three years.
CHANGE OF CONTROL PROVISIONS
The Company's 1988 Stock Incentive Plan provides that, if there is a Change
of Control of the Company (as defined below), unless otherwise determined by the
Executive Compensation Committee at the time of grant, all stock options and
SARs granted under the Plan which are not then exercisable will become fully
exercisable and vested and the restrictions and deferral limitations applicable
to restricted stock and deferred stock granted under the Plan will lapse and
such shares and awards will be deemed fully vested. To the extent the cash
payment of any award is based on the fair market value of Company Common Stock,
such fair market value shall be the Change of Control Price, as defined below.
A Change of Control occurs on the date a person or group (other than the
Company and certain of its affiliates or Rexel, S.A. and its affiliates) becomes
a 25% beneficial owner of the voting securities of the Company, the date on
which one-third or more of the Board of Directors consists of persons other than
Current Directors (as defined) or the date of approval by stockholders of
certain agreements providing for merger, consolidation or disposition of all or
substantially all assets. The Change of Control Price will be the highest price
per share of Company Common Stock paid in any open market transaction, or paid
or offered to be paid relating to a Change of Control of the Company, at any
time during the 90-day period ending with the Change of Control.
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Company's executive compensation program consists of the following key
elements: base salary, annual bonuses and periodic grants of stock options.
12
<PAGE>
BASE SALARY. The Company's executive officers have employment contracts
providing for a minimum base salary. The amounts of such base salary were
generally determined by negotiation with such officers, and were largely
influenced by the base salaries historically paid to them. Mr. Viry's employment
contract was negotiated between him and Rexel, S.A., the owner of approximately
46% of the Company's stock, and was approved by the Executive Compensation
Committee. Base salary rates paid by the Company are generally intended to be at
or below the average for comparable positions with similar companies in the
electrical supply distribution industry, with the opportunity for significant
bonuses if certain financial results are achieved.
BONUSES. Under the Company's bonus program for executive officers, a net
income goal for the Company is established at the beginning of each year. The
Executive Compensation Committee then assigns to each executive officer a
potential bonus range determined by a minimum percentage of base salary to be
applicable if 80% of the net income goal is achieved and a maximum percentage of
base salary if actual net income exceeds the goal by a specified amount. The
amount of the bonus is adjusted if actual net income is within the established
range. With respect to 1995, the net income goal (as adjusted for certain
expenses and cost reductions not anticipated when the goal was established) was
exceeded, and Mr Viry was entitled to a bonus of $191,240.
STOCK OPTIONS. Stock option grants are intended to provide incentives for
superior long-term future performance and to create and maintain in the Company
the entrepreneurial environment and spirit of a small company. The number of
stock options awarded to a particular employee is based on the Committee's
subjective judgment. In general, the Committee expects to grant the largest
awards to the Company's Chief Executive Officer and other senior management due
to their substantial influence on the Company's performance. During 1995, the
committee granted to Mr. Viry an option to purchase 50,000 shares.
EXECUTIVE COMPENSATION COMMITTEE
Austin List, Chair
John B. Fraser
Gerald E. Morris
The information above under the caption "Board Compensation Committee Report
on Executive Compensation" and under the caption "Performance Graph" below shall
not be deemed to be incorporated by reference into any filing by the Company
under the Securities Act of 1933, as amended, or the Securities Exchange Act of
1934, as amended, except to the extent that the Company expressly states in any
such filing that such information under either or both such captions is
incorporated by reference therein.
13
<PAGE>
PERFORMANCE GRAPH
The following graph shows the cumulative total shareholder return for the
periods indicated of (1) the Company's Common Stock, (2) a New York Stock
Exchange Market Value Index, (3) an index of textile weaving companies published
by Media General Financial Services, Inc. ("MGFS"), and (4) an index of
electrical supply distribution companies (Primary SIC Code 5063) published by
MGFS, all based on information provided by MGFS. In each case the graph assumes
an investment of $100 on December 31, 1990 and that all dividends were
reinvested. Until November 12, 1992, the Company was engaged in both lines of
business reflected in the graph. On November 12, 1992, the Company declared a
distribution of its textile business as a dividend to shareholders. The graph
has been constructed on the assumption that the shares received as such dividend
were sold and the proceeds reinvested in the Company's Common Stock on December
15, 1992, the date on which the Company's Common Stock traded "Ex-Dividend."
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
ELECTRICAL DISTRIBUTION
REXEL NYSE MARKET INDEX TEXTILE INDEX INDEX
<S> <C> <C> <C> <C>
1990 100.00 100.00 100.00 100.00
1991 138.42 129.41 140.19 169.69
1992 225.52 135.50 167.95 194.24
1993 349.55 153.85 - 205.68
1994 264.98 150.96 - 202.55
1995 608.90 195.61 - 233.36
</TABLE>
<TABLE>
<CAPTION>
ELECTRICAL
NYSE TEXTILE DISTRIBUTION
YEAR END REXEL INDEX INDEX INDEX
- ----------------------------------------------- --------- ----------- --------- -----------
<S> <C> <C> <C> <C>
1990........................................... 100 100 100 100
1991........................................... 138.40 129.41 140.19 169.69
1992........................................... 225.52 135.50 167.95 194.24
1993........................................... 349.55 153.85 -- 205.68
1994........................................... 264.98 150.86 -- 202.55
1995........................................... 608.90 195.61 -- 233.36
</TABLE>
14
<PAGE>
CERTAIN TRANSACTIONS
A subsidiary of the Company made an advance to Mr. Viry, which bears
interest at a rate of 7.69% per annum, to assist him in purchasing a new
residence in connection with his relocation from Paris, France to Coral Gables,
Florida at the request of the Company. The highest amount outstanding on the
advance during 1995 was $726,184 and the balance, secured by a first mortgage on
the residence, was $693,490 at February 5, 1996. Any gain recognized on resale
of the residence will be divided between Mr. Viry and the subsidiary in the
proportion that the principal amount outstanding bears to the total resale
price. Any loss will be borne by the subsidiary
The Company's SES subsidiary leases eleven facilities from Mr. Merson and/or
members of his or his wife's family, for terms extending through 2002. The
Company believes that these leases are on terms at least as favorable as SES
could have obtained from an unaffiliated third party.
The Company and Rexel, S.A., the owner of approximately 45% of the
outstanding common stock of the Company and the world's largest electrical
supplies distributor, have entered into a Services Agreement, dated as of
November 1, 1995. The Services Agreement was negotiated and approved by a
special committee of the Board of Directors consisting of persons who are
neither officers nor directors of Rexel, S.A. or its affiliates nor have a
material financial relationship with Rexel, S.A. and its affiliates. Under this
agreement, in consideration for the benefits to the Company arising from its
association with the worldwide business of Rexel, S.A., including without
limitation, in matters relating to customers, suppliers, employers, business
methods and know-how and financial expertise, the Company has agreed to pay to
Rexel, S.A. $600,000 per year (commencing with 1995). In addition, Rexel, S.A.
has agreed to provide consulting services to the Company relating to specific
projects at the request of the Company at a rate 10% higher than the costs to
Rexel, S.A. of providing such services (including, in the case of employees of
Rexel, S.A., costs based on the wages, social insurance payments and allocated
overhead and general corporate expenses attributable to such employees). Any
payment for consulting services must be approved by the Audit Committee of the
Board of Directors (excluding any member thereof who is an officer or director
of Rexel, S.A. or any of its affiliates or a person that has a material
financial relationship with Rexel, S.A. or any of its affiliates). During 1995,
the Company requested from Rexel, S.A. services valued at $340,000 relating to
the development of training programs, logistics consulting, enhancement of cash
management and treasury systems and a global agreement on implementation of an
inventory management system. In addition, pursuant to the agreement, Rexel, S.A.
consented to the use by the Company of the name "Rexel". The Services Agreement
is effective through December 31, 1996, subject to automatic renewal for
successive one year terms unless terminated on 30 days notice given by either
party prior to the commencement of a renewal term.
The Company has contracts for insurance coverage with National Union Fire
Ins. Co. and Reliance Insurance Co., entered into on May 13, 1995 under which
the Company's directors and officers (as well as the Company) are indemnified
under certain circumstances with respect to litigation and other costs and
liabilities arising out of actual or alleged misconduct of such directors and
officers. The Company pays 100% of all premiums ($225,305 for the period ending
May 12, 1996) to the insurers.
15
<PAGE>
INDEPENDENT ACCOUNTANTS
Coopers & Lybrand L.L.P. served as independent accountants in the audit of
the books and accounts of the Company for the 1995 fiscal year. A representative
of Coopers & Lybrand L.L.P. is expected to be present at the Annual Meeting of
Stockholders with the opportunity to make a statement if so desired. Such
representative is expected to be available to respond to appropriate questions.
The Audit Committee of the Board of Directors has not yet recommended the
independent accountants for the 1996 fiscal year audit.
STOCKHOLDER PROPOSALS
Pursuant to the By-Laws of the Company, nominations for the election of
directors may be made by the Board of Directors, the Nominating Committee or any
stockholder entitled to vote for the election of directors, provided such
stockholder has delivered written notice of his intention to make such
nomination in accordance with the By-Laws. Such notice must be delivered to or
mailed, postage prepaid, and received by the Secretary of the Company at 150
Alhambra Circle, Suite 900, Coral Gables, FL 33134, in the case of an annual
meeting, not later than 90 days prior to the anniversary date of the immediately
preceding Annual Meeting. However, if the Annual Meeting is to be held more than
30 days before or after the anniversary date of the immediately preceding Annual
Meeting, and in the case of any special meeting, such notice must be delivered
or received not later than the close of business on the 10th day following the
first public disclosure by the Company of the date of such meeting. Each such
notice must state: (i) the name and address of the stockholder who intends to
make the nomination and of the person(s) to be nominated; (ii) a representation
that the stockholder is a holder of record of stock entitled to vote at such
meeting (or if the record date for such meeting is subsequent to the date
required for notice, a representation that the stockholder is a holder of record
at the time of such notice and intends to be a holder of record on the record
date for such meeting), specifying the number and class of shares so held, and
that the stockholder intends to appear in person or by proxy at the meeting to
nominate the person(s) specified in the notice; (iii) a description of all
arrangements or understandings between the stockholder and each nominee and any
other person(s) (naming such person(s)) pursuant to which the nomination(s) are
to be made; (iv) such other information regarding each nominee as would have
been required to be included in a proxy statement filed pursuant to the proxy
rules of the SEC had each nominee been nominated, or intended to be nominated,
by the Board of Directors; and (v) consent of each nominee to serve as a
director of the Company if so elected.
The By-Laws of the Company also provide that no business may be brought
before an Annual Meeting except such business as shall be specified in the
notice of the meeting (or any supplement thereto) given by or at the direction
of the Board of Directors, other business brought before the meeting by or at
the direction of the Board of Directors or the Chairman of the Board or business
brought before the meeting by a stockholder entitled to vote thereon, provided
such stockholder has given written notice of such stockholder's intention to
bring such business before the Annual Meeting in accordance with the By-Laws.
Such notice must be delivered to, or mailed, postage prepaid, and received by,
the Secretary of the Company at the address specified above within the time
period described above. Each such notice must state: (i) a brief description of
the business desired to be brought before the meeting and the reasons for
conducting such business at the meeting; (ii) the name and address of the
stockholder who intends to propose such business; (iii) a representation that
the
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<PAGE>
stockholder is a holder of record of stock of the Company entitled to vote at
such meeting (or if the record date for such meeting is subsequent to the date
required for such stockholder notice, a representation that the stockholder is a
holder of record at the time of such notice and intends to be a holder of record
on the record date for such meeting), and that the stockholder intends to appear
in person or by proxy at such meeting to propose such business; and (iv) any
material interest of the stockholder in such business.
A copy of the By-Laws of the Company is available by written request to the
Secretary of the Company at the above address or by oral request at (305)
446-8000.
In the event that any stockholder desires to present a proposal to be
reflected in the Company's form of proxy and proxy statement for the 1997 Annual
Meeting of Stockholders, that proposal must be received at the Company's
principal offices on or before December 23, 1996. Timely receipt of a
stockholder proposal satisfies only one of the various requirements for
inclusion of such a proposal in the Company's proxy materials.
DISCRETIONARY AUTHORITY
Management has no knowledge of any matters to be presented for action by the
stockholders other than as set forth above. The accompanying form of proxy gives
discretionary authority, however, in the event that any additional matters
should be presented.
By Order of the Board of Directors,
JON O. FULLERTON
Secretary
April 19, 1996
17
<PAGE>
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REXEL, INC.
Solicited by the Board of Directors for use at the Annual Meeting of
Stockholders of Rexel, Inc., May 17, 1996, at 11:00 a.m., at The Metropolitan
Club, One East 60th Street, New York, New York.
The undersigned hereby appoints Jon O. Fullerton, Steven M. Hitt and Alain
C. Viry, and any one of them, attorneys and proxies, with full power of
substitution and revocation in each, for and on behalf of the undersigned, and
with all the powers the undersigned would possess if personally present, to vote
at the above Annual Meeting and any adjournment thereof all shares of stock that
the undersigned would be entitled to vote at such meeting.
THIS PROXY IS CONTINUED ON REVERSE SIDE.
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY.
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
<PAGE>
- --------------------------------------------------------------------------------
The shares represented by the proxy will be voted as directed by the
stockholder. If no direction is given when the duly executed proxy is returned,
such shares will be voted "FOR all Nominees" in Item 1.
Please mark
your votes as
indicated in
this example /X/
The Board of Directors recommends a vote "FOR" all nominees.
FOR WITHHELD for all
all nominees nominees
1. Election of Messrs. Gentles, / / / /
Morris and Weinberg as Class I
Directors.
Withheld for the following only:
(Write the name of the nominee(s) in the space below) / / Will attend
- ----------------------------------------------------------
In their discretion, the proxies are authorized to vote upon other business as
may properly come before the meeting.
Please mark, date and sign as your name appears hereon and return in the
enclosed envelope. If signing as executor, administrator, trustee, guardian,
etc. you should so indicate when signing. If the signer is a corporation, please
sign the full corporate name by duly authorized officer. If shares are held
jointly, each shareholder should sign.
Signature Signature Date ,1996
-------------------- --------------- ----------
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
