SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SECURITIES 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
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
/X/ Definitive Additional Materials
/ / Soliciting Material Pursuant to 240.14a-110 or 240.14a-12
ENERGIZER HOLDINGS, INC.
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(Name of Registrant as Specified in its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i) 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:
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[LOGO OF ENERGIZER]
ENERGIZER HOLDINGS, INC.
800 Chouteau Avenue
St. Louis, Missouri 63102
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders of
Energizer Holdings, Inc. to be held at 2:30 p.m. on Monday, January 29, 2001 at
the Auditorium at The Saint Louis Art Museum, 1 Fine Arts Drive, St. Louis,
Missouri 63110-1380.
We hope you will attend in person. If you plan to do so, please bring the
enclosed Shareholder Admittance Ticket with you. Please note that your access
will be limited to the Auditorium--the Art Museum will not be available for
viewing on that date.
Whether you plan to attend the meeting or not, we encourage you to read this
Proxy Statement and vote your shares. You may sign, date and return the
enclosed proxy as soon as possible in the postage-paid envelope provided, or
you may vote by telephone or via Internet. However you decide to vote, we would
appreciate your voting as soon as possible.
We look forward to seeing you at the Annual Meeting!
/s/ J. Patrick Mulcahy
J. PATRICK MULCAHY
Chief Executive Officer
December 13, 2000
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ENERGIZER HOLDINGS, INC.
800 Chouteau Avenue
St. Louis, Missouri 63102
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders:
The Annual Meeting of Shareholders of Energizer Holdings, Inc. will be held
at 2:30 p.m. on Monday, January 29, 2001, at the Auditorium at The St. Louis
Art Museum, 1 Fine Arts Drive, St. Louis, Missouri 63110-1380.
The purpose of the meeting is to:
1. elect three directors to serve three-year terms ending at the Annual
Meeting held in 2004, and one director to serve a two-year term ending
at the Annual Meeting held in 2003, or until their respective successors
are elected and qualified; and
2. approve the Energizer Holdings, Inc. 2000 Incentive Stock Plan;
and to act upon such other matters as may properly come before the meeting.
You may vote if you are a shareholder of record on November 24, 2000. It is
important that your shares be represented and voted at the Meeting. Please vote
in one of these ways:
. USE THE TOLL-FREE TELEPHONE NUMBER shown on the proxy card;
. VISIT THE WEB SITE noted on your proxy card to vote via the Internet; OR
. MARK, SIGN, DATE AND PROMPTLY RETURN the enclosed proxy card in the
postage-paid envelope.
By Order of the Board of Directors,
/s/ T. L. Grosch
Timothy L. Grosch
Secretary
December 13, 2000
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PROXY STATEMENT--VOTING PROCEDURES
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YOUR VOTE IS VERY IMPORTANT
The Board of Directors is soliciting proxies to be used at the 2001 Annual
Meeting. This proxy statement and the form of proxy will be mailed to
shareholders beginning December 13, 2000.
Who Can Vote
Record holders of Energizer Holdings, Inc. Common Stock on November 24, 2000
may vote at the meeting. On November 24, 2000, there were 94,402,011 shares of
Common Stock outstanding. The shares of Common Stock held in the Company's
treasury will not be voted.
How You Can Vote
There are three voting methods:
. Voting by Mail. If you choose to vote by mail, simply mark your proxy, date
and sign it, and return it in the postage-paid envelope provided.
. Voting by Telephone. You can vote your shares by telephone by calling the
toll-free telephone number on your proxy card.
. Voting by Internet. You can also vote via the Internet. The web site for
Internet voting is on your proxy card, and voting is available 24 hours a
day.
If you vote by telephone or via the Internet you should not return your proxy
card.
How You May Revoke or Change Your Vote
You can revoke your proxy at any time before it is voted at the meeting by:
. sending written notice of revocation to the Secretary;
. submitting another proper proxy by telephone, Internet or paper ballot; or
. attending the Annual Meeting and voting in person. If your shares are held in
the name of a bank, broker or other holder of record, you must obtain a
proxy, executed in your favor, from the holder of record to be able to vote
at the meeting.
General Information on Voting
You are entitled to cast one vote for each share of Common Stock you own on the
record date. Shareholders do not have the right to vote cumulatively in
electing directors. The election of each director nominee, and approval of the
2000 Incentive Stock Plan, must be approved by a majority of shares entitled to
vote and represented at the Annual Meeting in person or by proxy. Shares
represented by a proxy marked "abstain" on any matter, or that provide that a
vote be withheld on any matter, will be considered present at the Meeting for
purposes of determining a quorum and for purposes of calculating the vote, but
will not be considered to have voted in favor of the proposal. Therefore, any
proxy marked "abstain" will have the effect of a vote against the matter.
Shares represented by a proxy as to which there is a "broker non-vote" (for
example, where a broker does not have discretionary authority to vote the
shares), will be considered present at the meeting for purposes of determining
a quorum, but will have no effect on the vote.
All shares that have been properly voted--whether by telephone, Internet or
mail--and not revoked, will be voted at the Annual Meeting in accordance with
your instructions. If you sign your proxy card but do not give voting
instructions, the shares represented by that proxy will be voted as recommended
by the Board of Directors.
If any other matters are properly presented at the Annual Meeting for
consideration, the persons named in the enclosed proxy card will have the
discretion to vote on those matters for you. At the date this proxy statement
went to press, we do not know of any other matter to be raised at the Annual
Meeting.
Voting By Participants in the Company's or Ralston's Savings Investment Plan
If you participate in the Company's Savings Investment Plan or in the Ralston
Purina Company Savings Investment Plan and had an account in the Energizer
Common Stock Fund on November 16, 2000, the proxy will also serve as voting
instructions to the trustee for both plans, Vanguard Fiduciary Trust Company,
an affiliate of The Vanguard Group of Investment Companies, for the shares of
Common
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Stock credited to your account on that date. If the trustee does not receive
directions with respect to any shares of Common Stock held in a plan, it will
vote those shares in the same proportion as it votes shares in that plan for
which directions were received.
Costs of Solicitation
The Company will pay for preparing, printing and mailing this proxy statement.
We have engaged Georgeson & Company, Inc. to help solicit proxies from
shareholders for a fee of $11,000 plus its expenses. Proxies may also be
solicited personally or by telephone by regular employees of the Company
without additional compensation, as well as by employees of Georgeson. The
Company will reimburse banks, brokers and other custodians, nominees and
fiduciaries for their costs of sending the proxy materials to our beneficial
owners.
Compliance With Section 16(a) Reporting
The rules of the Securities and Exchange Commission require that the Company
disclose late filings of reports of stock ownership and changes in stock
ownership by its directors and executive officers. To the best of the Company's
knowledge, all of the filings for the Company's executive officers and
directors were made on a timely basis in 2000.
ITEM 1. ELECTION OF DIRECTORS
The Board of Directors consists of nine members and is divided into three
classes, with one class currently consisting of two members, one class
currently consisting of three members, and one class currently consisting of
four members, with terms of service expiring at successive Annual Meetings.
In order to equalize the classes, three directors will be elected at the 2001
Annual Meeting to serve for a three-year term expiring at our Annual Meeting in
the year 2004, and one director will be elected to serve for a two-year term
expiring at our Annual Meeting in the year 2003. The Board has nominated Robert
Pruzan, F.S. Garrison, R. David Hoover and H. Fisk Johnson for election as
directors at this Meeting, with Messrs. Pruzan, Garrison and Hoover to serve
until the 2004 Annual Meeting, and Mr. Johnson to serve until the 2003 Annual
Meeting. Each nominee is currently serving as a director and has consented to
serve for a new term. Each nominee elected as a director will continue in
office until his successor has been elected and qualified. If any nominee is
unable to serve as a director at the time of the Annual Meeting, your proxy may
be voted for the election of another person the Board may nominate in his or
her place, unless you indicate otherwise.
Vote Required. The affirmative vote of a majority of the outstanding shares of
Common Stock entitled to vote and represented in person or by proxy is required
for the election of each director.
The Board of Directors recommends a vote FOR the election of these nominees for
election as directors.
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INFORMATION ABOUT NOMINEES AND OTHER DIRECTORS
Please review the following information about the nominees and other directors
continuing in office. The ages shown are as of December 31, 2000.
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[Photo] ROBERT PRUZAN, Director Since 2000, Age 37
(Standing for election at this meeting for a term expiring
2004)
President of Wasserstein Perella & Co., Inc. (investment
banking).
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[Photo] F.S. GARRISON, Director Since 2000, Age 66
(Standing for election at this meeting for a term expiring
2004)
Chairman of the Board, American Freightways, Inc. (trucking).
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[Photo] R. DAVID HOOVER, Director Since 2000, Age 55
(Standing for election at this meeting for a term expiring
2004)
President, Vice Chairman and Chief Operating Officer, Ball
Corporation (aerospace products, packaging products). Also a
director of Datum, Inc.
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[Photo] H. FISK JOHNSON, Director Since 2000, Age 42
(Standing for election at this meeting for a term expiring
2003)
Chairman of the Board and Chairman, S.C. Johnson & Son, Inc.
(consumer products).
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[Photo] RICHARD A. LIDDY, Director Since 2000, Age 65
(Continuing in Office--Term Expiring in 2002)
Chairman and CEO, GenAmerica Corporation (insurance holding
company), Chairman of the Board of the Reinsurance Group of
America, Incorporated (insurance), and also a director of
Brown Shoe Company, Inc., Ameren Corporation and Ralston
Purina Company.
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[Photo] JOE R. MICHELETTO, Director Since 2000, Age 64
(Continuing in Office--Term Expiring in 2002)
Chief Executive Officer and President, Ralcorp Holdings, Inc.
(food products). Also a director of Ralcorp Holdings, Inc.,
Agribrands International, Inc. and Vail Resorts, Inc.
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[Photo] WILLIAM H. DANFORTH, Director Since 2000, Age 74
(Continuing in Office--Term Expiring in 2002)
Trustee and former Chancellor, Washington University. Also a
director of Ralston Purina Company.
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[Photo] J. PATRICK MULCAHY, Director Since 2000, Age 56
(Continuing in Office--Term Expiring in 2003)
Chief Executive Officer, Energizer Holdings, Inc. Also a
director of Solutia Inc.
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[Photo] WILLIAM P. STIRITZ, Director Since 2000, Age 66
(Continuing in Office--Term Expiring in 2003)
Chairman of the Board and Chairman of the Energizer Holdings,
Inc. Management Strategy and Finance Committee. Also Chief
Executive Officer and President of Agribrands International,
Inc. (international animal feeds) and a director of Ralston
Purina Company, Agribrands International, Inc., Angelica
Corporation, Ball Corporation, The May Department Stores
Company, Ralcorp Holdings, Inc., Reinsurance Group of America,
Inc. and Vail Resorts, Inc.
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BOARD OF DIRECTORS STANDING COMMITTEES
<TABLE>
<CAPTION>
Nominating
and
Executive
Board Member Board Audit Executive Finance Compensation
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
William H. Danforth X X X X X*
----------------------------------------------------------------------------
F.S. Garrison X X X X
----------------------------------------------------------------------------
R. David Hoover X X* X
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H. Fisk Johnson X
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Richard A. Liddy X X* X X
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Joe R. Micheletto X X X X
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Robert Pruzan X X
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J. Patrick Mulcahy X X X
----------------------------------------------------------------------------
William P. Stiritz X* X* X
----------------------------------------------------------------------------
Meetings held in 2000 5 3 0 0 1
</TABLE>
*Chairperson
Audit: Reviews auditing, accounting, financial reporting and internal control
functions. Recommends our independent accountants and reviews their services.
All members are non-employee directors.
Executive: May act on behalf of the Board in the intervals between Board
meetings.
Finance: Reviews the Company's financial condition, objectives and strategies
and makes recommendations to the Board concerning financing requirements,
dividend policy, foreign currency management and pension fund performance.
Nominating and Executive Compensation: Sets compensation of executive officers,
approves
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deferrals under the Company's Deferred Compensation Plan, administers the
Company's 2000 Incentive Stock Plan and grants stock options and other awards
under that plan. Monitors management compensation and benefit programs, and
reviews principal employee relations policies. Recommends nominees for election
as directors or executive officers to the Board. Also recommends committee
memberships and compensation and benefits for directors. All members are non-
employee directors.
The Nominating and Executive Compensation Committee will consider suggestions
from shareholders regarding possible director candidates for the terms of Board
members expiring in 2002. Such suggestions, together with appropriate
biographical information, should be submitted to the Secretary of the Company.
See "Shareholder Proposals for 2002 Annual Meeting" for details regarding the
procedures and timing for the submission of such suggestions.
During fiscal year 2000, all directors attended 75% or more of the Board
meetings and Committee meetings on which they served.
Director Compensation
All directors, other than J. Patrick Mulcahy, received the following fees for
serving on the Board or its Committees. Mr. Mulcahy received no compensation
other than his normal salary from the Company for his service on the Board and
its Committees.
Annual Retainer..........................................................$30,000
Fee for Each Board Meeting...............................................$ 1,000
Fee for Each Committee Meeting...........................................$ 1,000
The chairpersons of the Committees also received an additional annual retainer
of $2,000 for each Committee that they chaired.
Stock Awards
On May 8, 2000, each non-employee director, other than Mr. Johnson, received an
option to purchase 10,000 shares of Common Stock of the Company at $17.00, the
closing price for such shares on that date on the New York Stock Exchange
composite index. Mr. Stiritz received an option to purchase 500,000 shares of
Common Stock at the closing price on that date. Mr. Johnson received an option
to purchase 10,000 shares on September 18, 2000, the date of his appointment to
the Board, at $20.00, the closing price of the Common Stock on that date. The
options, which were granted under the Company's 2000 Incentive Stock Plan and
have a ten year term, are exercisable at the rate of 20% per year, beginning on
the first anniversary of the date of grant. They are exercisable prior to that
date upon the director's death, declaration of total and permanent disability,
retirement or resignation from the Board, or upon a change in control of the
Company.
On May 8, 2000, each non-employee director, other than Mr. Johnson, also
received a restricted stock equivalent award under which the director will be
credited with a restricted stock equivalent for each share of the Company's
Common Stock he acquires prior to May 8, 2002, up to a limit of 10,000 shares.
Mr. Stiritz received a similar award, but with a limit of 130,000 shares. (On
September 18, 2000, Mr. Johnson was granted a similar award, up to a limit of
10,000 shares, with respect to shares of Common Stock he acquires prior to
September 18, 2002.) The equivalents granted will vest three years from
crediting and will convert, at that time, into an equal number of shares of
Common Stock. They also vest upon a director's death, declaration of total and
permanent disability, or upon a change in control of the Company. If elected by
the director, conversion may be deferred until the director terminates his
service on the Board. As of November 1, 2000, the following directors have been
credited with the indicated number of restricted stock equivalents: Mr.
Danforth--10,000 equivalents; Mr. Micheletto--1,500 equivalents; Mr. Pruzan--
5,800 equivalents; Mr. Liddy--9,000 equivalents; Mr. Hoover--3,000 equivalents;
Mr. Garrison--0 equivalents; Mr. Johnson--0 equivalents; Mr. Stiritz--130,000
equivalents.
Deferred Compensation Plan
Directors can elect to have their retainer and meeting fees paid monthly in
cash, or defer payment until their retirement under the terms of the Energizer
Holdings, Inc. Deferred Compensation Plan. Under that Plan, they can defer in
the form of stock equivalents under the Energizer Common Stock Unit Fund, which
tracks the value of the
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Company's Common Stock, they can defer into the Prime Rate Option, under which
deferrals are credited with interest at Morgan Guaranty Trust Company of New
York's prime rate, or they can defer into any of the Measurement Fund Options
which track the performance of the Vanguard investment funds offered under the
Company's Savings Investment Plan. Deferrals in the Energizer Common Stock Unit
Fund during each calendar year are increased by a match from the Company at the
end of that year. For the year 2000, the Company set the matching contribution
at 33 1/3% for Directors. Deferrals in the Plan are paid out in a lump sum in
cash within 60 days following the director's termination of service on the
Board.
Compensation Committee Interlocks and Insider Participation
Mr. Stiritz, Chairman of the Management Strategy and Finance Committee and
Chairman of the Board of the Company, is Chairman of the Nominating and
Compensation Committee of the Board of Directors of Ralcorp Holdings, Inc.,
Chairman of the Compensation Committee of S.C. Johnson & Son, Inc., and also
serves on the Human Resources Committee of the Board of Directors of Ball
Corporation. Mr. Micheletto, a director of the Company, is the Chief Executive
Officer and President of Ralcorp Holdings, Inc. Mr. Johnson, also a director of
the Company, is Chairman of the Board and Chairman of S.C. Johnson & Son, Inc.
Mr. Hoover, also a director of the Company, is the President, Vice Chairman and
Chief Operating Officer of Ball Corporation. Mr. Micheletto and Mr. Hoover
serve on the Nominating and Executive Compensation Committee of the Company's
Board of Directors.
Certain Relationships and Related Transactions
Spin-off and Related Transactions
Prior to April 1, 2000, the Company was a wholly-owned subsidiary of Ralston
Purina Company. On April 1, 2000, Ralston distributed the Common Stock of the
Company to its shareholders in a tax free distribution or spin-off. Immediately
prior to the spin-off, Ralston and the Company entered into certain agreements
described below providing for the Company's orderly transition from a
subsidiary to an independent publicly-held corporation.
Agreement and Plan of Reorganization
------------------------------------
Ralston and the Company entered into an Agreement and Plan of Reorganization
(the "Reorganization Agreement") providing for, among other things, the
principal corporate transactions required to effect the spin-off. The
Reorganization Agreement also provided for the transfer of certain assets and
liabilities from Ralston to the Company, in particular assets and liabilities
associated with employee benefit plans in which employees of the Company
participated. Under the Reorganization Agreement, Ralston agreed to retain or
assume certain liabilities associated with the operation of the Company's
business prior to the spin-off.
In addition, the Reorganization Agreement provided that the Company would
assume the obligation to repay approximately $480 million which was borrowed by
Ralston immediately prior to the spin-off, as well as retain pre-existing debt
of its international battery subsidiaries. Because the debt assumed and
retained by the Company at the time of the spin-off, net of cash held by the
Company as of the spin-off, exceeded a targeted amount of indebtedness set
forth in the Reorganization Agreement, a cash settlement of approximately $22
million was paid by Ralston to the Company following the spin-off.
Subject to certain exceptions, the Reorganization Agreement provides for
indemnification by the parties as follows:
Ralston has agreed to indemnify the Company against any liabilities assumed
or retained by Ralston in the Reorganization Agreement, and liabilities
relating to:
. any breach by Ralston of any covenant made in the Reorganization
Agreement or certain other agreements described in the Reorganization
Agreement (the "Ancillary Agreements");
. any third party claim primarily relating to the actions of the Ralston
board of directors in authorizing the spin-off; and
. the operation of the businesses conducted, or to be conducted, by Ralston
and its subsidiaries or the ownership of its assets (other than the
operation or assets of the battery business) both prior to and following
the spin-off.
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The Company has agreed to indemnify Ralston against any liabilities assumed
or retained by the Company in the Reorganization Agreement, including the debt
which the Company assumed or retained, and liabilities relating to:
. any breach by the Company of any covenant made in the Reorganization
Agreement or any Ancillary Agreement;
. the operation of the Company's business and former battery operations
controlled by its subsidiaries, or the ownership of the assets used in
those businesses, except to the extent those liabilities are assumed or
retained by Ralston in the Reorganization Agreement or any Ancillary
Agreement; and
. all liabilities arising out of Ralston's continuing guarantee of any
obligation of the Company or any subsidiary of the Company.
The indemnification payments described above are limited to the amount of the
loss, less insurance proceeds (net of any deductibles or allocated paid-loss
retro-premiums) which may be received for the loss by the party seeking
indemnification.
Neither Ralston nor the Company have any liability to the other for taxes
except as provided in the Tax Sharing Agreement, described below.
The Reorganization Agreement also provides that, in order to avoid adversely
affecting the intended favorable tax consequences of the spin-off, neither the
Company nor any of its subsidiaries will engage in certain transactions for a
period of time following April 1, 2000 unless, in the sole discretion of
Ralston, either:
. a legal opinion satisfactory to Ralston is obtained from counsel selected
by the Company and approved by Ralston, or
. a supplemental ruling is obtained from the IRS,
and such opinion or ruling provides that the transactions would not adversely
affect the Federal income tax consequences of the spin-off, as set forth in the
private letter rulings which have already been obtained from the IRS by
Ralston.
The Company does not expect that these limitations will significantly inhibit
its activities or its ability to respond to business developments. The
transactions subject to this provision, and the periods such transactions will
be limited, are:
. material sales, exchanges or distributions to shareholders by the
Company, or other material dispositions of any of the Company's assets,
except in the ordinary course of business--30 months;
. repurchases of Common Stock, unless the repurchase satisfies certain IRS
Ruling criteria--24 months;
. issuances or dispositions of Common Stock that represent in the aggregate
50% or more of the issued and outstanding Common Stock--30 months;
. the liquidation of the Company or its merger with any other corporation
(including a subsidiary)--30 months; or
. the cessation by the Company of the active conduct of the battery
business, within the meaning of Section 355(b) of the Code--30 months.
In addition, the Reorganization Agreement provides that, if the Company
engages in any of these transactions, and if the spin-off becomes taxable under
the provisions of the Code because of its actions, the Company will indemnify
Ralston (and its stockholders that received shares of Common Stock in the spin-
off) against all tax liabilities, including interest and penalties, which are
incurred. Ralston has agreed to indemnify the Company against losses which it
may incur in the event that Ralston or any of its subsidiaries take any action
which adversely impacts the tax-free nature of the spin-off.
Tax Sharing Agreement
Until April 1, 2000, the business operations of the Company were included in
the consolidated Federal income tax returns of Ralston. As part of the spin-
off, Ralston and the Company entered into a Tax Sharing Agreement providing,
among other things, for the allocation between the parties of Federal, state,
local and foreign tax liabilities for all periods through 12:01 a.m. on April
1, 2000, and reimbursement by each party for any of its taxes which may have
been or will be paid or advanced by the other. The Tax Sharing Agreement
provides that:
. Ralston will be liable for certain domestic tax liabilities for periods
ending on or before
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<PAGE>
April 1, 2000, including such liabilities resulting from audits or other
adjustments to previously filed tax returns;
. The Company will be liable for certain foreign tax liabilities
attributable to the operation of the Company's business prior to April 1,
2000; and
. The Company will be responsible for all Federal, state, local and foreign
taxes attributable to its business on and after April 1, 2000.
Though valid as between Ralston and the Company, the Tax Sharing Agreement is
not binding on the IRS or foreign tax authorities. It will not affect the joint
and several liability of Ralston and the Company, and their respective
subsidiaries, to the IRS or to foreign tax authorities for taxes of the Ralston
consolidated group relating to periods prior to the spin-off.
Bridging Agreement
-------------------
Ralston and the Company entered into a Bridging Agreement under which Ralston
and, in certain cases, the Company, have agreed to continue to provide certain
administrative services for a limited period of time following the spin-off.
Charges for such services have been determined on a fair market basis.
Lease Agreement
----------------
Ralston and Eveready Battery Company, Inc., a wholly owned subsidiary of the
Company, entered into a lease under which Eveready leased office space for
headquarters operations for a period of one year following the spin-off at a
negotiated rental rate reflecting the market rate for comparable space in the
area.
Distribution Agreement
-----------------------
Ralston and the Company entered into an agreement providing for the continued
distribution in the Philippines by the Company's local subsidiary of pet
products manufactured by Ralston. All payments and other terms and conditions
for this agreement have been determined through arm's length bargaining on a
fair market basis.
Guaranteed Loans for Officers
Under the Company's Shareholder Value Commitment Program, the Company has
granted restricted stock equivalent awards to encourage direct, long-term
ownership of its Common Stock by directors and certain officers and key
executives. Under the program, individual acquisitions of shares of Common
Stock, up to a maximum per individual, are matched with an equal number of
restricted stock equivalents which vest and convert into shares of Common Stock
three years from the date of crediting. Purchases of Common Stock by certain
officers in that Program were financed by personal loans made to the officers
from Bank of America. The Company has guaranteed the bank loans but each
officer has agreed to indemnify the Company if it incurs any loss under the
guarantee provided for his loan, and has agreed that the Company may set off
such losses against amounts that it may otherwise owe to him. The largest
aggregate amount owed during fiscal 2000 on each guaranteed bank loan made to
the executive officers was as follows: Mr. Zimmermann--$333,307.83; Mr.
Strachan-- $153,893.53; Mr. Rose--$643,993.47; Mr. McClanathan--$204,049.39;
Mr. Conrad--$438,292.24; Mr. Sanborn--$310,547.16.
Other Transactions
The Company has entered into an Engagement Agreement with Wasserstein Perella
& Co., Inc., under which Wasserstein has been retained to provide financial
advisory services to the Company in connection with implementing and completing
long-term strategic plans and, in the event of any offer or proposal to the
Company or its shareholders regarding control of the Company, matters relating
to takeover defense. Mr. Pruzan, a director of the Company, is President of
Wasserstein.
To the Company's best knowledge, Mr. Pruzan does not receive direct or
indirect compensation related to the Company's retention arrangement with the
Wasserstein firm. He has disclaimed any material interest in that arrangement.
The Company expects that its business relationship with Wasserstein will
continue and any transactions will be conducted in the ordinary course and on
competitive terms.
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ITEM 2. PROPOSAL TO APPROVE AND RATIFY THE
ENERGIZER HOLDINGS, INC. 2000 INCENTIVE STOCK PLAN
You are asked to approve adoption of the Energizer Holdings, Inc. 2000
Incentive Stock Plan. The Board of Directors adopted this Plan on March 16,
2000 at its first meeting, and it was approved by Ralston Purina Company, as
the Company's sole shareholder, at that time. It is now being submitted to
shareholders for their approval with respect to future stock awards. (Awards
previously granted under the Plan are not contingent upon shareholder
approval.) The following is a summary of the Plan. Please refer to Exhibit A to
this Proxy Statement for the full text of the Plan.
Reason for Adoption of the Plan
Section 162(m) of the Internal Revenue Code limits the Company's ability to
deduct compensation in excess of $1 million which may be paid to any of the
five highest paid executive officers in a particular fiscal year unless the
compensation meets the statutory definition of "performance-based" compensation
which has been approved by a majority of shareholders. The Company has been
advised that the approval of the 2000 Incentive Stock Plan by Ralston Purina
Company prior to the spin-off of the Company enables the Company to deduct
compensation payable under stock options granted under the Plan prior to the
Company's first regular meeting of shareholders. However, in order to deduct
compensation which it may pay to executives under future awards which may be
granted under the Plan, the Company must submit the 2000 Incentive Stock Plan
for shareholder approval.
PURPOSE The purpose of the Plan is to promote the interests of the Company and
its stockholders by:
. attracting and retaining key employees,
. tying the compensation of key employees to the performance of the
Company, and
. providing an opportunity for participants to increase their holdings of
Common Stock.
The Plan would also permit the Board of Directors to grant stock options and
other stock awards to individual directors, if the Board decides to do so.
Administration The Plan is administered by the Nominating and Executive
Compensation Committee of the Board of Directors, which has the authority to
select employees to receive awards, to determine the types of awards and the
number of shares of Common Stock covered by awards, and to set the terms and
conditions of awards. The Committee may delegate authority to employees or
employee committees to select the employees (other than executive officers) who
will receive awards. However, the full Board of Directors will determine the
amount, terms and conditions of stock options or other stock awards granted to
directors. The Committee has the authority to establish rules for the
administration of the Plan, and its determinations and interpretations are
binding.
Eligible Participants
. Any employee or officer (including executive officers) of the Company or
any of its subsidiaries will be eligible for any award under the Plan if
selected by the Committee. There are about 10,500 employees of the
Company and its subsidiaries that would be eligible for awards under the
Plan.
. Any of the non-employee directors of the Company will also be eligible to
receive stock options or other stock awards under the Plan if authorized
by the full Board of Directors.
Neither the Committee nor the Board has made any decisions with respect to the
individuals who may receive future awards under the Plan or the amount or
nature of future awards.
SHARES AUTHORIZED The number of shares of the Company's Common Stock which were
originally authorized for awards under the Plan was 15,000,000. (The number of
shares authorized is subject to certain adjustments to reflect, for example,
stock splits or other corporate restructurings.) As of the date of this proxy
statement, 8,333,000 shares have been reserved for awards granted since the
Plan's adoption, and 6,667,000 shares remain available for future awards.
9
<PAGE>
In addition, if any award is forfeited or expires, all shares which were not
issued under the award will become available for additional awards under the
Plan. If a restoration option is granted when shares of Common Stock are
tendered for the exercise of any options granted under the Plan, the number of
shares available for awards under the Plan will be increased by the number of
shares tendered.
Any awards that may be payable in cash will not be counted against the reserve
unless the actual payment is made in shares of Common Stock instead of cash.
The closing price of the Common Stock on November 24, 2000 was $21.94.
MAXIMUM NUMBER OF SHARES The maximum number of shares of the Company's Common
Stock that may be the subject of performance-based awards (including stock
options and stock appreciation rights, but not restoration options) granted
under the Plan to an employee or director during any one fiscal year is
1,900,000. The maximum number of shares that may be the subject of restoration
options granted to an employee or director in any one fiscal year is 950,000.
Any stock-related deferred compensation will not be applied against this limit.
TYPES OF AWARDS The Plan permits the grant of a variety of different types of
awards:
. Stock options and restoration options;
. Stock appreciation rights ("SARs") (also called phantom stock options);
. Restricted stock awards;
. Stock equivalents; and
. Other awards valued by reference to the Company's Common Stock.
Awards may be granted for any amount of cash consideration or for no cash
consideration as long as legal requirements are met.
Stock Options: The Committee may grant stock options that qualify as "Incentive
Stock Options" under Section 422 of the Internal Revenue Code ("ISOs") or
options that do not so qualify ("Non-Qualified Options"). The Committee or
Board may also grant restoration options which are designed to replace shares
of Common Stock used to exercise an option. The restoration options will be
granted at fair market value, the shares subject to the restoration option will
equal no more than the number of shares tendered, and the option will be
exercisable for the remaining period of the original option grant.
All options granted will be subject to the following:
. Options are not exercisable (unless accelerated) for at least one year
after they are granted, and they cannot be exercised more than ten years
after grant.
. The exercise price must be paid at the time the option is exercised in
either cash or in other shares of Common Stock.
. The exercise price cannot be less than the fair market value of Common
Stock on the grant date.
. The Committee or Board will determine the vesting schedules of options
granted under the Plan and may also impose additional conditions on
exercise, including performance goals.
Stock Appreciation Rights: The holder of an SAR or phantom stock option is
entitled to receive the excess of the fair market value of a specific number of
shares on the date of exercise over the value of those shares on the date the
award was granted. Payment of the excess will be in cash unless the Committee
or Board elects to make payment in shares of Common Stock. The Committee or the
Board will determine the vesting schedule of SARs granted under the Plan and
may also impose additional conditions on exercise.
Restricted Stock Awards: Shares of restricted stock may be awarded subject to
such restrictions and other terms and conditions as the Committee or Board may
impose. Restricted stock may not be transferred by the holder until the
restrictions lapse.
Stock Related Deferred Compensation: The Committee may permit the deferral of
payment of an employee's cash bonus or other cash compensation in the form of
Common Stock equivalents, subject to such terms and conditions as the Committee
may impose. Stock equivalents track the value of the Common Stock, and are
credited with dividend equivalents if dividends are paid on the Common Stock.
Distribution of deferred amounts is made at the employee's retirement or other
termination of employment, or at such other time elected by the employee, under
conditions established by the Committee.
10
<PAGE>
FEDERAL INCOME TAX CONSEQUENCES If you are a recipient of awards under the
Plan, the following is a summary of the principal U.S. federal income tax
consequences that are generally applicable:
Options and SARs.
If you are a recipient of options or SARs under the Plan:
. The grant of an option or SAR is not expected to result in any taxable
income for you.
. If you hold an ISO, you generally will have no taxable income upon
exercising the ISO if certain requirements are met (except that a
liability may arise for alternative minimum tax), and the Company will
not be entitled to a tax deduction when an ISO is exercised.
. If you exercise a Non-Qualified Option, you will recognize ordinary
income equal to the difference between the fair market value of the
shares of Common Stock acquired and the exercise price. The Company will
be entitled to a tax deduction for the same amount.
. If you exercise an SAR, or if the SAR vests without exercise, the amount
of any cash received will be taxable to you as ordinary income and will
be deductible by the Company.
. The tax consequences upon a sale of your shares acquired in an exercise
of an option will depend on how long you held the shares prior to sale,
and upon whether the shares were acquired in the exercise of an ISO or in
the exercise of a Non-Qualified Option or SAR.
. If you hold shares acquired upon exercise of an ISO for at least one year
after exercise and two years from the date that the ISO was granted, you
will recognize long-term capital gain or loss in an amount equal to the
difference between the option exercise price and the sale price of the
shares. If you do not hold the shares so acquired for that period, gain
on the sale of the shares will be treated as ordinary income.
. Any gain which you realize upon the sale of shares acquired in the
exercise of a Non-Qualified Option or SAR for an amount greater than
their fair market value on the date of exercise, will be capital gain and
any loss will be capital loss. Generally there will be no tax
consequences to the Company in connection with your disposition of shares
acquired in the exercise of an option or SAR, except that the Company may
be entitled to a tax deduction in the case of a sale of ISO shares before
the holding periods described above have been satisfied.
Restricted Stock and Other Awards.
Generally, restricted stock awards will not be taxed to you until restrictions
lapse on all, or any portion, of the award.
. When any portion of an award is released from restrictions, the fair
market value of those shares on the date the restrictions lapse will be
included in your income for that year and will be taxed at ordinary
income tax rates. Your basis in the stock received will be equal to the
fair market value at the time that restrictions lapse, and the holding
period will begin on that date.
. You may elect to have the restricted stock award treated as taxable
income in the year granted. You will be taxed at ordinary income tax
rates on the fair market value of the award on the date of grant. Any
future appreciation in value of those shares at the time they are sold
will be taxed as capital gain, and any decline will be treated as a
capital loss.
. If you elect to be taxed in the year the award is granted, and the award
is later forfeited before restrictions lapse, the income taxes paid will
not be recoverable.
. The Company will have deductible expense equal to the fair market value
of the restricted shares in whatever year you recognize ordinary income
as a result of the award.
Amounts deferred in the form of stock equivalents, as well as dividend
equivalents earned on such amounts, will be taxed as ordinary income for the
year in which the amounts are actually distributed to you. If the distribution
is made in shares of Common Stock, the taxable income will be equal to the
fair market value of the shares on the date distributed, which will also be
your basis in those shares. The Company will have deductible expense equal to
the amount distributed.
11
<PAGE>
ADJUSTMENTS Certain corporate transactions or events such as stock splits,
recapitalizations, spin-offs, mergers, etc. may directly affect the number of
outstanding shares and/or the value of the outstanding Common Stock. If such
transactions occur, the Committee may adjust the number of shares which may be
granted under the Plan, as well as the limits on individual awards. The
Committee or the Board may adjust the number of shares and the exercise price
under outstanding options, and the performance goals of any options or awards,
and may make other adjustments which are thought appropriate to protect the
value of the award to the recipient.
TRANSFERABILITY Awards granted under the Plan may not be transferred except:
. by beneficiary designation;
. by will or the laws of descent and distribution; or
. if permitted by the Committee, to an immediate family member, family
trust or family partnership.
AMENDMENTS The Board of Directors may amend, suspend or terminate the Plan at
any time. Except for permitted adjustments, no amendment, however, may
. increase the number of shares reserved for awards;
. withdraw the authority of the Committee to administer the Plan;
. increase the limit on the number of shares which are the subject of awards
granted to any individual; or
. change the terms of any awards granted before the amendment in an adverse
manner without the consent of the recipient.
TERM The Plan will continue until December 31, 2009, unless replaced or
terminated at an earlier time.
New Plan Benefits and Options
Although future benefits which may be granted under the Plan have not been
determined, the benefits granted or credited under the Company's 2000 Incentive
Stock Plan prior to the date of this Proxy Statement are shown in the table
below. The restricted stock equivalents indicated reflect the total number of
equivalents which have been or may be granted to these individuals upon their
acquisition of an equal number of shares of the Company's Common Stock. Awards
to the most highly compensated executives are set forth in the Summary
Compensation Table on page 16. The specific terms of these awards are described
in the footnotes to the Table on page 16 and the Summary Compensation Table.
These awards, and their deductibility by the Company, are not contingent upon
shareholder approval of the Plan. Shareholder approval will only impact the
deductibility of future awards which may be granted.
<TABLE>
<CAPTION>
No. of
Shares Restricted
Underlying Stock
Options Equivalents
---------------------------------------------------------------------------------
<S> <C> <C>
All current Executive Officers as a Group 4,325,000 565,000
---------------------------------------------------------------------------------
Mr. Pruzan 10,000 10,000
---------------------------------------------------------------------------------
Mr. Garrison 10,000 10,000
---------------------------------------------------------------------------------
Mr. Hoover 10,000 10,000
---------------------------------------------------------------------------------
Mr. Johnson 10,000 10,000
---------------------------------------------------------------------------------
Mr. Stiritz 500,000 130,000
---------------------------------------------------------------------------------
All current Non-Employee Directors as a Group 70,000 70,000
---------------------------------------------------------------------------------
All other Employees as a Group 3,283,000 20,000
</TABLE>
12
<PAGE>
Vote Required. The affirmative vote of a majority of the outstanding shares of
Common Stock entitled to vote and represented in person or by proxy is required
for approval of the Plan.
The Board of Directors recommends a vote FOR the approval and ratification of
the Energizer Holdings, Inc. 2000 Incentive Stock Plan.
OTHER BUSINESS
The Board knows of no business which will be presented at the 2001 Annual
Meeting other than that described above. The Company's Bylaws provide that
shareholders may nominate candidates for directors or present a proposal or
bring other business before an Annual Meeting only if they give timely written
notice of the nomination or the matter to be brought not less than 90 nor more
than 120 days prior to the Meeting. No such notice with respect to the 2001
Annual Meeting was received by October 31, 2000, the deadline for the Annual
Meeting.
SELECTION OF AUDITORS
The Board, upon the recommendation of the Audit Committee, appointed
PricewaterhouseCoopers LLP as independent accountants for the current fiscal
year. PricewaterhouseCoopers LLP was the Company's independent accountant for
fiscal year 2000. A representative of that firm will be present at the 2001
Annual Meeting of Shareholders and will have an opportunity to make a
statement, if desired, as well as to respond to appropriate questions.
13
<PAGE>
STOCK OWNERSHIP INFORMATION
Five Percent Owners of Common Stock. As of November 1, 2000, there are no
persons known by the Company to beneficially own at least 5% of the Company's
Common Stock.
COMMON STOCK OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
% of Shares
Shares Outstanding
held in (B)
Directors Shares Savings (*denotes
And Beneficially Investment less than
Executive Officers Owned Plan(A) Total(B) 1%)
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
William H. Danforth 940,782(C)(D)(E) 0 940,782 *
--------------------------------------------------------------------------------
F. S. Garrison 0 0 0 *
--------------------------------------------------------------------------------
R. David Hoover 3,000 0 3,000 *
--------------------------------------------------------------------------------
H. Fisk Johnson 0 0 0 *
--------------------------------------------------------------------------------
Richard A. Liddy 10,000 0 10,000 *
--------------------------------------------------------------------------------
Joe R. Micheletto 1,508 0 1,508 *
--------------------------------------------------------------------------------
Robert Pruzan 5,800 0 5,800 *
--------------------------------------------------------------------------------
William P. Stiritz 2,525,233(F) 0 2,525,233 2.64%
--------------------------------------------------------------------------------
J. Patrick Mulcahy 211,843(G) 5,160 217,003 *
--------------------------------------------------------------------------------
Patrick Mannix 91,186 7,356 98,542 *
--------------------------------------------------------------------------------
Daniel Corbin 0 3,304 3,304 *
--------------------------------------------------------------------------------
Randy Rose 33,304 4,905 38,209 *
--------------------------------------------------------------------------------
Harry Strachan 13,115 3,470 16,585 *
--------------------------------------------------------------------------------
All Officers and Directors 3,932,185(H) 63,145 3,995,330 4.18%
</TABLE>
14
<PAGE>
In general, "beneficial ownership" includes those shares a director or
executive officer has the power to vote or transfer, as well as shares owned by
immediate family members that reside with the director or officer.
(A) Column indicates the most recent approximation of the number of shares of
Common Stock as to which participants in the Company's Savings Investment
Plan have voting and transfer rights. Shares of Common Stock which are held
in the Plan are not directly allocated to individual participants but
instead are held in a separate fund in which participants acquire units.
Such fund also holds varying amounts of cash and short-term investments.
The number of shares allocable to a participant will vary on a daily basis
based upon the cash position of the fund and the market price of the stock.
(B) The number of shares outstanding, and the numbers beneficially owned, are
as of November 1, 2000.
(C) Excludes 2,423,999 shares of Common Stock held by the Danforth Foundation,
St. Louis, MO. Mr. Danforth is one of the ten trustees of the Foundation
and disclaims beneficial ownership of its shares.
(D) Excludes 1,112,754 shares of Common Stock held by Washington University,
St. Louis, MO. Mr. Danforth serves on the University's Board of Trustees,
which consists of 54 members. He disclaims beneficial ownership of those
shares.
(E) Mr. Danforth has sole voting and investment powers respecting 62,050 shares
of Common Stock. He shares voting and investment powers with respect to
878,732 shares, which includes 51,208 shares held in a trust which are not
reported on his Section 16 reports. Mr. Danforth disclaims beneficial
ownership of those 51,208 shares. The 878,732 shares exclude 122,125 shares
which have been reported as beneficially owned by Mr. Danforth on his
Section 16 reports, but with respect to which Mr. Danforth does not have
voting or investment powers.
(F) Mr. Stiritz disclaims beneficial ownership of 521,357 shares of Common
Stock owned by his wife and 140,576 shares owned by his son.
(G) Mr. Mulcahy disclaims beneficial ownership of 12,500 shares of Common Stock
owned by his wife and 111 shares owned by his step-daughter.
(H) Excludes 1,731,005 shares of Common Stock held to fund retirement benefits
by the Energizer Holdings, Inc. Retirement Plan Trust of which four
executive officers serve as the trustees who collectively exercise voting
and investment power. These officers disclaim beneficial ownership of those
shares.
15
<PAGE>
EXECUTIVE COMPENSATION
The following tables and narratives discuss the compensation paid in fiscal
year 2000 to the Chief Executive Officer and the other four most highly
compensated executive officers ("Named Executive Officers").
The Summary Compensation Table set forth below summarizes compensation received
by the Named Executive Officers since the spin-off of the Company by Ralston
Purina Company, that is, for six months rather than for a full fiscal year.
Annualized salaries, i.e., the salary amounts which would have been paid to the
Named Executive Officers had they been paid for a full year at the rates in
effect from April 1, 2000, the date of the spin-off, through the end of the
fiscal year, are reflected in the "Salary" column.
The full amount of bonuses paid by the Company during fiscal year 2000 is
reflected in the "Bonus" column. No attempt has been made to pro rate bonuses
based on the relationship between the period before the spin-off and the period
after the spin-off.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Long Term Compensation
Compensation (Awards)
------------------ ----------------------
Securities Restricted
Other Annual Underlying Stock All Other
Name and Principal Compensation Options Equivalents Compensation
Position Year Salary($) Bonus($) ($) (#) ($)(1) ($)(2)
------------------ ---- --------- -------- ------------ ---------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
J. P. Mulcahy 2000 $650,000 $886,500 $ 0 500,000 $2,320,000 $176,558
Chief Executive Officer
P. C. Mannix 2000 $342,000 $326,500 $ 0 400,000 $1,322,075 $ 79,313
President
Daniel Corbin 2000 $243,600 $202,600 $ 0 250,000 0 $ 47,984
Executive Vice
President,
Finance and Control
Randy Rose 2000 $230,000 $191,300 $ 0 300,000 $ 630,000 $ 8,754
President and Chief
Operating Officer,
North America and Europe
H.L. Strachan 2000 $220,500 $183,300 $ 0 200,000 $ 265,924 $ 10,667
Vice President and
General Counsel
</TABLE>
--------
(1) As of September 30, 2000, the aggregate number and value of restricted
stock equivalents credited to each of the Named Executive Officers:
. Mr. Mulcahy, 130,000 equivalents; $3,185,000
. Mr. Mannix, 75,000 equivalents; $1,837,500
. Mr. Corbin, 0 equivalents;
. Mr. Rose, 30,000 equivalents; $735,000
. Mr. Strachan, 13,115 equivalents; $321,318
Under the terms of Restricted Stock Equivalent Award Agreements entered into
with each Named Executive Officer, for each share of Common Stock acquired by
each Officer in the open market, an equal number of restricted stock
equivalents were credited to his account as of the date of the acquisition. The
restricted stock equivalents vest three years from the date of grant, and will
be converted into shares of Common Stock at that time unless the Officer elects
to defer conversion until termination of employment. The equivalents also vest
upon the Officer's death, disability, involuntary termination of employment or
change of control of the Company. If dividends are paid on the Common Stock, an
amount in cash equal to the dividends that would have been paid if the
equivalents had been actual shares of Common Stock will be paid to the Officer
at the time of conversion.
16
<PAGE>
(2) The amounts shown in this column with respect to fiscal year 2000 consist
of the following:
(i) the Savings Investment Plan and Executive Savings Investment Plan--
Company matching contributions or accruals:
. Mr. Mulcahy, $4,875
. Mr. Mannix, $5,130
. Mr. Corbin, $4,524
. Mr. Rose, $4,164
. Mr. Strachan, $6,025
The amounts shown do not include benefits which were accrued by the Named
Executive Officers in the Executive Savings Investment Plan in lieu of the
PensionPlus Match Account in the Energizer Holdings, Inc. Retirement Plan due
to certain limits imposed by the Internal Revenue Code on accruals in the
Retirement Plan. Such additional amounts are disclosed in the information
about the PensionPlus Match Account found on page 20.
(ii) the Deferred Compensation Plan--a Company match of 25% of amounts
deferred under the Equity Option:
. Mr. Mulcahy, $171,625
. Mr. Mannix, $74,125
. Mr. Corbin, $43,402
. Mr. Rose, $2,427
. Mr. Strachan, $4,584
(iii) the Group Life Insurance Plan--term life insurance premiums paid by
the Company for the first $40,000 of coverage for each of the Named
Executive Officers: $58
(iv) Split-dollar life insurance premiums paid by the Company, which will
be repaid on a specified future date, valued by multiplying the premiums
outstanding during the fiscal year by the Company's weighted average short-
term borrowing rate during the year:
. Mr. Rose, $2,105.42
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
(a) (b) (c) (d) (e) (f)
% of Total
Number of Options
Securities Granted to Exercise
Underlying Employees or Base
Options in Fiscal Price Expiration Grant Date
Name Granted (#) Year ($/Sh) Date Value ($)
---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
J. Patrick
Mulcahy 500,000(1)(2) 6.8% $17.00(3) 5-07-10 $4,200,000(4)
---------------------------------------------------------------------------
Patrick C.
Mannix 400,000(1)(2) 5.5% $17.00(3) 5-07-10 $3,400,000(4)
---------------------------------------------------------------------------
Daniel E.
Corbin, Jr. 250,000(1)(2) 3.4% $17.00(3) 5-07-10 $2,100,000(4)
---------------------------------------------------------------------------
Randy Rose 300,000(1)(2) 4.1% $17.00(3) 5-07-10 $2,500,000(4)
---------------------------------------------------------------------------
Harry L.
Strachan 200,000(1)(2) 2.7% $17.00(3) 5-07-10 $1,700,000(4)
</TABLE>
(1) Options granted were options to acquire shares of Common Stock.
(2) Options become exercisable at the rate of 20% of total shares on the
anniversary of the date of grant in each of the years 2001, 2002, 2003,
2004 and 2005 and upon death, declaration of permanent and total
disability, voluntary termination of employment at or after age 55,
involuntary termination other than for cause, or upon a change in control
of the Company.
(3) Market price on date of grant.
(4) Calculated using the Black Scholes pricing model. Underlying assumptions
used in the calculation include a ten-year expiration, a current market
price and strike price of $17 per share, a ten year volatility assumption
of 20.13%, a current dividend yield of 0.0% and a risk-free rate of return
of 6.12%, which was derived from the 10-year treasury zero-coupon yield
curve. The Company has elected to illustrate the potential realizable
value using the Black Scholes pricing model as permitted by the rules of
the Securities and Exchange Commission. This does not represent the
Company's estimate or projection of future stock price or of the
assumptions utilized; actual gains, if any, upon future exercise of any of
these options will depend on the actual performance of the Common Stock.
17
<PAGE>
FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised
Options at FY-End (#) Options at FY-End ($)
-------------------------------------------------------------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
J. P. Mulcahy 0 500,000 0 3,750,000
-------------------------------------------------------------------------------
P. C. Mannix 0 400,000 0 3,000,000
-------------------------------------------------------------------------------
D. E. Corbin, Jr. 0 250,000 0 1,875,000
-------------------------------------------------------------------------------
R. Rose 0 300,000 0 2,250,000
-------------------------------------------------------------------------------
H. L. Strachan 0 200,000 0 1,500,000
</TABLE>
None of the Named Executive Officers exercised options during fiscal year 2000.
RETIREMENT PLAN
The Energizer Holdings, Inc. Retirement Plan may provide pension benefits in
the future to the Named Executive Officers. Most regular U.S. employees that
have completed one year of employment with the Company or certain of its
subsidiaries are eligible to participate in the Retirement Plan. They become
vested after five years of service. Normal retirement is at age 65; however,
employees who work beyond age 65 may continue to accrue benefits.
Final Average Earnings Formula. Annual benefits for the Named Executive
Officers and other administrative employees are computed by multiplying their
Final Average Earnings (the average of their five highest consecutive annual
earnings during the ten years prior to their termination of employment) by a
number which is 1.5% of their actual years of service (to a maximum of 40
years). That amount is then reduced by up to one-half of their primary social
security benefit at retirement (with the actual amount of offset determined by
their age and years of service at retirement). In the case of Mr. Mannix, that
amount is further reduced to reflect an offset for benefits he has accrued in
the Company's Australian Superannuation Plan No. 3, a funded plan sponsored by
one of the Company's foreign affiliates.
With the exception of Mr. Mannix, the following table shows the estimated
annual retirement benefits, in the form of a single life, 5-year certain
annuity beginning at age 65, that would be payable from the Retirement Plan to
salaried employees, including the Named Executive Officers. To the extent a
Named Executive Officer's compensation or benefits exceed certain limits
imposed by the Internal Revenue Code of 1986, as amended, the table also
includes benefits payable from an unfunded supplemental retirement plan. The
table reflects benefits prior to the reduction for social security benefits
described above.
18
<PAGE>
RETIREMENT PLAN TABLE
Final Average Earnings Formula--Annuity Payments
<TABLE>
<CAPTION>
Final Years of Service
Average --------------------------------------------------------------------
Earnings 10 15 20 25 30 35 40
---------- -------- -------- -------- -------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 300,000 $ 45,000 $ 67,500 $ 90,000 $112,500 $ 135,000 $ 157,500 $ 180,000
$ 400,000 $ 60,000 $ 90,000 $120,000 $150,000 $ 180,000 $ 210,000 $ 240,000
$ 500,000 $ 75,000 $112,500 $150,000 $187,500 $ 225,000 $ 262,500 $ 300,000
$ 600,000 $ 90,000 $135,000 $180,000 $225,000 $ 270,000 $ 315,000 $ 360,000
$ 700,000 $105,000 $157,500 $210,000 $262,500 $ 315,000 $ 367,500 $ 420,000
$ 800,000 $120,000 $180,000 $240,000 $300,000 $ 360,000 $ 420,000 $ 480,000
$1,000,000 $150,000 $225,000 $300,000 $375,000 $ 450,000 $ 525,000 $ 600,000
$1,200,000 $180,000 $270,000 $360,000 $450,000 $ 540,000 $ 630,000 $ 720,000
$1,400,000 $210,000 $315,000 $420,000 $525,000 $ 630,000 $ 735,000 $ 840,000
$1,500,000 $225,000 $337,500 $450,000 $562,500 $ 675,000 $ 787,500 $ 900,000
$1,600,000 $240,000 $360,000 $480,000 $600,000 $ 720,000 $ 840,000 $ 960,000
$1,800,000 $270,000 $405,000 $540,000 $675,000 $ 810,000 $ 945,000 $1,080,000
$2,000,000 $300,000 $450,000 $600,000 $750,000 $ 900,000 $1,050,000 $1,200,000
$2,200,000 $330,000 $495,000 $660,000 $825,000 $ 990,000 $1,155,000 $1,320,000
$2,400,000 $360,000 $540,000 $720,000 $900,000 $1,080,000 $1,260,000 $1,440,000
</TABLE>
Internationalist Plan. In addition to the Final Average Earnings Formula
described above, Mr. Mannix participates in the Company's Internationalist
Plan, which is unfunded. Internationalist Plan benefits for Mr. Mannix are
computed by multiplying his Final Average Earnings (the average of his five
highest consecutive annual earnings during the ten years prior to his
termination of employment) by a number which is 1.7% of his actual years of
service (to a maximum of 40 years).
Mr. Mannix's benefits under the Internationalist Plan are offset by benefits
payable to him under the Energizer Holdings, Inc. Retirement Plan, the
supplemental retirement plan, and the Superannuation Plan. Mr. Mannix's
benefit, payable under the Superannuation Plan as a single sum payment, is
computed by multiplying his Final Average Base Earnings (the average of his
five highest consecutive base annual earnings during the ten years prior to his
termination of employment) by a number which is 15% of his actual years of
service (to a maximum of 40 years). Based upon prevailing long term bond rates,
this single sum amount would then be converted to an equivalent annuity payable
to Mr. Mannix, with that annuity being used to offset the benefits payable
under the Energizer Holdings, Inc. retirement plans. The actual amount of each
pension plan's offset will be determined by Mr. Mannix's age and years of
service at his retirement.
19
<PAGE>
The following table shows the estimated annual retirement benefits, in the form
of a single life, 5-year certain annuity, that would be payable to Mr. Mannix
from the Internationalist Plan, assuming age 62 retirement and including the
equivalent value of amounts payable to him from the other offsetting Company
retirement plans.
INTERNATIONALIST PLAN TABLE*
Final Average Earnings Formula--Annuity Payments
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Final Average Years of Service
Earnings ----------------------------------------------------
-------------
30 35 40
--------- -------- --------
<S> <C> <C> <C>
$ 475,000 $242,250 $282,625 $323,000
$ 525,000 $267,750 $312,375 $357,000
$ 575,000 $293,250 $342,125 $391,000
$ 625,000 $318,750 $371,875 $425,000
$ 675,000 $344,250 $401,625 $459,000
$ 725,000 $369,750 $431,375 $493,000
$ 775,000 $395,250 $461,125 $527,000
$ 825,000 $420,750 $490,875 $561,000
$ 875,000 $446,250 $520,625 $595,000
$ 925,000 $471,750 $550,375 $629,000
$ 975,000 $497,250 $580,125 $663,000
$ 1,025,000 $522,750 $609,875 $697,000
</TABLE>
--------
*1.7% accrual rate
PensionPlus Match Account
To the extent that each of the Named Executive Officers has elected to
contribute compensation on an after-tax basis to the Company-sponsored Savings
Investment Plan (SIP), a matching single sum amount is credited to a nominal
account balance established for each individual in the pension plan. The single
sum amount credited to the individual's account each year is equal to 325% of
the first 1% of pay (up to a certain limit imposed on pay by the Internal
Revenue Code) contributed by the individual to the SIP. The amounts so credited
each year to the nominal account are further annually credited each plan year
with interest at a rate equal to the average 30-year U.S. Treasury bond rate in
effect during the August preceding the October 1 beginning of each plan year.
These nominal accounts may be received by the participant, upon termination of
employment, in the form of a lump sum or an equivalent annuity. For the period
from April 1, 2000 to September 30, 2000, the following amounts were accrued in
the PensionPlus Match Accounts of the Named Executive Officers. To the extent a
Named Executive Officer's compensation or benefits exceed certain limits
imposed by the Internal Revenue Code of 1986, as amended, amounts below also
include benefits payable from the unfunded Executive Savings Investment Plan.
. Mr. Mulcahy: $16,250
. Mr. Mannix: $5,558
. Mr. Corbin: $4,901
. Mr. Rose: $4,511
. Mr. Strachan: $6,528
For the purpose of calculating retirement benefits, the Named Executive
Officers had, as of September 30, 2000, the following whole years of credited
service: Messrs. Mulcahy--32 years; Mannix--37 years; Corbin--16 years; Rose--
14 years; and Strachan--13 years. Earnings used in calculating benefits (other
than the PensionPlus Match Account) under the retirement plans are
approximately equal to amounts included in the Salary and Bonus columns in the
Summary Compensation Table on page 16.
20
<PAGE>
DEATH BENEFIT PLAN
The Company maintains, at no cost to the participants, an unfunded Executive
Retiree Life Plan to provide supplemental benefits to certain key members of
management, generally at the level of division vice president and above. The
Plan provides a death benefit, after retirement of the participant, to his or
her named beneficiary in an amount equal, on an after-tax basis, to 50% of the
participant's last full year's salary and bonus prior to retirement. To be
eligible for the benefit, a participant must, at the time of retirement, meet
certain conditions, including (1) being enrolled in the Company's voluntary
Group Life Insurance Plan, which is available to almost all non-union
administrative and production employees in the United States, with coverage of
at least one times earnings; and (2) being age 55 with at least two years of
service, or having a combination of age and years of service equal to at least
80. Messrs. Mannix, Corbin and Strachan participated in the voluntary Group
Life Insurance Plan, at the required coverage level, during fiscal year 2000.
EMPLOYMENT CONTRACTS, CHANGE IN CONTROL AND TERMINATION OF EMPLOYMENT
ARRANGEMENTS
Retention Agreements
Prior to the spin-off of the Company from Ralston Purina Company, the Company
entered into short-term retention agreements with Messrs. Mannix, Corbin, Rose
and Strachan, and certain other key executives, which provided that if those
individuals remained employed with the Company through January 15, 2001, they
would receive a cash payment equal to the aggregate amount of any bonus
payments they might receive for fiscal year 2000. That amount, for the named
Officers, is shown in the Summary Compensation Table on page 16. These
individuals were also given the opportunity to elect to defer such payments
into the Energizer Common Stock Unit Fund of the Energizer Holdings, Inc.
Deferred Compensation Plan and, if they so elected, such deferrals would be
matched with restricted stock equivalents, up to the limit awarded to each
individual, as described in the footnote to the Summary Compensation Table. To
the extent that any amounts so deferred are matched with restricted stock
equivalents, they will not receive a Company Match under the Deferred
Compensation Plan.
Change of Control Employment Agreements
The Company entered into Change of Control Employment Agreements with each of
the Named Executive Officers in fiscal year 2000. The Agreements have a term of
two years from their effective date (which will be automatically extended for
additional two year terms unless the Company terminates the Agreements at least
90 days prior to renewal), and provide that the Officers will receive severance
compensation in the event of their involuntary termination (including
constructive termination), other than for cause, within two years following a
change in control of the Company. A change of control is generally defined as
the acquisition of 20% or more of the outstanding shares of the Company's
Common Stock. A change of control will also occur if the initial directors of
the Company, or their recommended or appointed successors, fail to constitute a
majority of the board, or if the Company's stockholders approve a merger,
consolidation or sale of all or substantially all of the assets of the Company.
The severance compensation payable under the Agreements consists of:
. a lump sum payment in an amount equal to 2 times the Officer's annual base
salary and target bonus;
. the difference between the Officer's actual benefits under the Company's
various retirement plans at the time of termination and what the Officer
would have received if he had remained employed for an additional period of
two years; and
. the continuation of other executive health, dental and other welfare benefits
for a period of two years following the Officer's termination.
No payments would be made in the event that the termination is voluntary, is
due to death, disability or normal retirement, or is for cause.
In the event that it is determined that a "golden parachute" excise tax is due
under the Internal Revenue Code, the aggregate present value of amounts payable
or distributable to the Officer would be reduced to the amount at which the
21
<PAGE>
payments would be deductible by the Company and not subject to any excise tax.
Acceleration Clauses
The stock options and restricted stock equivalent awards which were granted
during the past fiscal year to employees, including the Named Executive
Officers, under the Company's 2000 Incentive Stock Plan, provide for
acceleration of vesting in the event of a change in control of the Company.
Employment Agreement with Mr. Corbin
Upon Mr. Corbin's resignation as Executive Vice President, Finance and Control,
which was effective November 10, 2000, he entered into an employment agreement
with Eveready Battery Company, Inc., the Company's U.S. operating subsidiary,
under the terms of which Mr. Corbin agreed to remain employed until January 1,
2003 in a consulting capacity. Under the employment agreement, he will continue
to be paid his current salary (which is indicated in the Summary Compensation
Table on page 16 of this Proxy Statement) throughout the term of the agreement,
and he will continue to be able to participate in benefit plans offered to
other salaried employees and executives. In addition, he will receive a bonus
payment of $125,000 in each of years 2001 and 2002. However, by the terms of
the employment agreement, Mr. Corbin has waived all rights and benefits under
his Restricted Stock Equivalent Award Agreement which was granted May 8, 2000.
In the event of his death before January 1, 2003, the balance of his salary
continuation and bonuses, if any, would be paid in a lump sum to his
beneficiary or estate.
NOMINATING AND EXECUTIVE COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION
The Nominating and Executive Compensation Committee (the "Committee") consists
entirely of non-employee directors free from relationships with the Company
that might be considered a conflict of interest. It approves direct and
indirect compensation of executive officers and administers and makes awards
under the Company's 2000 Incentive Stock Plan.
Compensation Philosophy
The overall objective of the Company's compensation philosophy is to reward
management based upon its success in building the shareholder value of the
Company as an independent business. The Company's executive compensation
program is designed to provide a compensation package that, in the aggregate,
will enable the Company to attract and retain highly talented executives and
maintain a performance oriented culture. In addition, the compensation program
is designed to emphasize stock-based incentive compensation in order to link
compensation much more directly to the performance of the Company's business,
as reflected in the stock market's evaluation of the Common Stock. The
compensation program is intended to be one of "high risk/high opportunity"--
with base salaries set below competitive levels, and incentive opportunities
for significant annual or long-term compensation. Compensation packages are
weighted toward programs that are contingent upon the Company's performance and
the performance of the Common Stock. The compensation incentives take the form
of annual bonuses based on performance targets for the Company as well as
individual assessments, and long-term stock-based incentives designed to
encourage Company stock ownership by executives and a managerial perspective
that is in alignment with shareholders' interests.
In determining competitive pay standards, the Committee received advice from
compensation consultants at PriceWaterhouseCoopers LLP, who reviewed data from
published surveys of pay practices of other U.S.-based corporations of similar
size with which the Company may compete in recruiting executive talent. These
corporations include, but are not limited to, corporations included in the
comparison indices set forth in the Performance Graph on page 28 of this Proxy
Statement.
Salaries
The base salary component of the compensation package for the executive
officers is set at a level below median levels for comparable executive
positions at comparison companies, with base salaries generally up to 15% below
the 50th percentile for those companies. At the same time,
22
<PAGE>
incentive programs are offered which provide the officers an opportunity to
achieve total compensation considerably above average, in the case of
exceptional performance. The Committee establishes the salaries of key
executive officers based on its assessment of the individual's
responsibilities, experience, individual performance and contribution to the
Company's performance. The Committee also takes into account compensation data
from other companies as described above; historical compensation levels at the
Company and its former parent, Ralston Purina Company; and the competitive
environment for attracting and retaining executives. In the case of executive
officers other than Mr. Mulcahy, the Committee received a recommendation from
Mr. Mulcahy as Chief Executive Officer. A more detailed discussion of the
Committee's decisions regarding Mr. Mulcahy's salary is set forth below. The
salaries for the Named Executive Officers are set forth in the Summary
Compensation Table on page 16. Mr. Stiritz does not receive a salary or an
annual cash bonus as compensation for his services as Chairman of the
Management Strategy and Finance Committee, but instead the Board granted him a
significant stock option grant and restricted stock equivalent opportunity, as
described below under Stock Awards.
Annual Cash Bonus Award Programs
Annual cash bonuses will generally be awarded each year at, or shortly after,
the end of the Company's fiscal year, in accordance with executive bonus plans
covering the entire fiscal year then ended. Because of the spin-off of the
Company on April 1, 2000, the Ralston Purina Board of Directors in September of
1999 established a bonus plan for employees of Eveready Battery Company, Inc.,
the U.S. operating subsidiary of the Company, for the first six months of
fiscal year 2000--while Eveready was still a part of Ralston Purina. The
bonuses, however, were actually paid by the Company following the spin-off. The
Committee adopted an executive bonus plan for the remaining six months of
fiscal year 2000, and will adopt a full-year bonus plan for fiscal year 2001.
However, in light of Mr. Mulcahy's and Mr. Mannix's positions with the Company,
it was believed it was more appropriate to measure their performance on an
annual rather than a semi-annual basis. Mr. Plana's performance was also
measured on an annual basis. Each of these individuals were not paid a bonus
for the first six months of fiscal year 2000, but instead were paid an annual
bonus based on entire fiscal year operating and market share results, as well
as their individual performance, during that year.
During the second half of fiscal year 2000, U.S. executive officers had an
opportunity to earn an award based on (1) the achievement of targeted increases
in the Company's U.S. operating profit, (2) growth in U.S. alkaline market
share, and (3) individual performance. The Company's budgeted estimate for U.S.
operating profits before taxes and amortization (EBITA) for the six month
period, established by the Company prior to the beginning of the fiscal year,
and adjusted thereafter only for extraordinary items, was set as a target under
the plan. Achievement of that target was a condition to any payment of bonuses
under the plan. Improvements in U.S. alkaline market share, as measured by A.C.
Nielsen, at fiscal year end over the average of the respective market shares
for the 13 week periods ending nearest March 31, 2000 and June 30, 2000, served
as a multiplier to individual bonus earnings under the plan, determined as a
percentage of base annual salary for the applicable period. For Messrs. Mulcahy
and Mannix, the operating profit target was the budgeted estimate for U.S.
EBITA for the entire fiscal year, as adjusted for extraordinary items, and
market share at fiscal year end was compared to U.S. alkaline market share at
the prior fiscal year end. The resulting bonus for all U.S. officers, including
Messrs. Mulcahy and Mannix, was then reduced or increased based upon individual
performance ratings. Individual performance is rated based on a subjective
assessment of factors including organizational and management development,
technical skills, execution of strategic plans, and overall quality of
performance.
For Messrs. Klein, Plana and Gunawardana, their individual bonuses, which were
also determined as a percentage of base annual salary, were based upon
achievement of operating profit targets for their respective operating regions,
and subjective assessments of their individual performance. In addition, market
share gain in western Europe, and working capital improvements in the PanAm
region, served as a multiplier for individual bonus earnings for Mr. Plana and
Mr. Gunawardana, respectively. The personal performance component was weighted
at approximately 40% of the total bonus award for Mr. Klein, and approximately
30% for Messrs. Plana and Gunawardana.
23
<PAGE>
The Committee's assessment of the performance of the executive officers, other
than Mr. Mulcahy, during this period was based upon a recommendation from Mr.
Mulcahy. The Committee, after considering a recommendation which it sought from
the Chairman of the Board, subjectively evaluated Mr. Mulcahy's performance
during the past fiscal year as Chairman and Chief Executive Officer of Eveready
Battery Company, Inc., his leadership in the spin-off, and his service as Chief
Executive Officer of the Company following the spin-off.
The Committee expects to continue to utilize executive bonus plans with varying
measures of individual and/or corporate performance for determining all or part
of bonuses for Executive Officers.
Deferrals of Bonus Awards
The Committee exercises its discretion in determining whether to permit
eligible employees, including Executive Officers, to defer payment of their
cash bonus or other cash compensation under the terms of the Deferred
Compensation Plan. The terms of that Plan may include, in any particular year,
an additional Company match on deferrals in the Energizer Common Stock Unit
Fund of the Plan. It has been determined that deferrals into the Energizer
Common Stock Unit Fund of all or part of annual or semi-annual cash bonuses
earned in fiscal year 2000 will be credited with a 25% Company match which is
subject to certain vesting requirements. The Committee believes that this
provision of the Plan further aligns the executive's interests with those of
shareholders of the Company by encouraging an investment in Company stock
equivalents. It also adds a retention feature through the vesting requirements.
In January of 2000, while still a subsidiary of Ralston Purina, Eveready
Battery Company, Inc., entered into retention agreements with a limited group
of executives of the Company (including the Named Executive Officers, other
than Mr. Mulcahy), in order to assure their continued service throughout the
period of the spin-off. These agreements provide that if the executives remain
employed by Eveready through January 15, 2001, they will be paid an amount
equal to the cash bonuses they received during the year 2000. These executives
have been given an opportunity to defer the payments they may be entitled to
receive under the retention agreements under the terms of the Deferred
Compensation Plan. If amounts which they defer are matched with restricted
stock equivalents, as described below, they will not be credited with the 25%
Company match.
Stock Awards
At the time of the spin-off from Ralston Purina Company, the Company's Board of
Directors adopted the 2000 Incentive Stock Plan. Under that plan, stock-based
incentive awards, including stock options and restricted stock awards, may be
granted from time to time. The plan is being submitted for shareholder
approval, with respect to future awards, at the 2001 Annual Meeting of
Shareholders. (See page 9 of this Proxy Statement.) In general, the Committee
bases its decisions to grant stock-based incentives on the number of shares of
Common Stock outstanding, the number of shares of Common Stock authorized under
the 2000 Incentive Stock Plan, the number of options and shares of restricted
Common Stock (or equivalents) held by the executive for whom an award is being
considered and the other elements of the executive's compensation, as well as
the Company's compensation objectives and policies described above. As with the
determination of base salaries and bonus awards, the Committee exercises
subjective judgment and discretion in view of the above criteria. In May of
2000, it was decided that, in order to immediately align the interests of
senior management with those of shareholders, and to retain key individuals
during the critical transition stage following the spin-off, it was advisable
to grant significant up-front ownership opportunities. The Board approved the
grant to key executives of one-time options which were significantly larger
than average annual grants for peer companies. The options will vest over a
four to five year period, and any non-vested portions of the options will be
forfeited if the officers voluntarily terminate employment (other than at
retirement at or after age 55) prior to complete vesting. It is contemplated
that additional stock options, if any, which may be granted to the officers in
the next several years will be significantly smaller in size.
Stock options granted by the Committee entitle the recipient to purchase a
specified number of shares of the Company's Common Stock, after certain vesting
provisions have been met, at an option price which is equal to the fair market
value of the Common Stock at the time of grant. They provide executives with an
opportunity to buy and maintain an equity
24
<PAGE>
interest in the Company while linking the executive's compensation directly to
shareholder value since the executive receives no benefit from the option
unless all shareholders have benefited from an appreciation in the value of the
Company's Common Stock. In addition, since the options "vest" serially,
generally in four or five segments over a period of four to five years after
the date of grant, they function as a retention device while encouraging the
executive to take a longer-term view about decisions impacting the Company.
Restricted stock awards consist of grants of the Company's Common Stock, or
stock equivalents convertible into shares of Common Stock, subject to certain
restrictions. The restricted shares may not be sold, pledged or otherwise
transferred until the restrictions lapse. Restricted stock awards further the
goal of retaining key executives by encouraging stock ownership and linking
executive performance with shareholder value.
In May of 2000, the Board of Directors of the Company also approved the
Shareholder Value Commitment Program in order to encourage a limited number of
key executives, including the Named Executive Officers, as well as the members
of the Board, to invest in and hold a significant number of shares of the
Company's Common Stock. Under the Program, each of those individuals was
granted the opportunity to receive one restricted stock equivalent, up to an
established limit per individual, for every share of the Company's Common Stock
the individual purchases during the two year period commencing on the date of
grant. Those executives who entered into the retention agreement referred to
under Deferrals of Bonus Awards above were given the opportunity to defer
payments under that agreement into the Energizer Common Stock Unit Fund of the
Deferred Compensation Plan, and if they so elected, the deferral would be
credited as a purchase of Common Stock for purposes of receiving matching
restricted stock equivalents. The executives must hold the acquired shares, or
keep their deferrals in the Energizer Common Stock Unit Fund, for at least
three years. The restricted stock equivalents credited to each executive will
vest over a three year period, at which time they will convert into an equal
number of shares of Common Stock, unless the executive has elected to defer
conversion until termination of employment. The Program serves not only to
encourage Common Stock ownership by the key executive group but also, by reason
of the vesting provisions, helps retain the services of these individuals.
In light of Mr. Stiritz's additional responsibilities and time commitment as
Chairman of the Management Strategy and Finance Committee, his value as an
advisor to the Chief Executive Officer and other officers of the Company, and
his active involvement in financial decisions which have been reached by the
Company, all of which Mr. Stiritz performs without salary or other additional
compensation, the Board of Directors, with Mr. Stiritz abstaining, approved the
grant of a significant stock option as well as a significant opportunity to
acquire restricted stock equivalents under the Shareholder Value Commitment
Program. It is expected that such awards will also serve as a means of
retaining Mr. Stiritz's services in such capacities for the Company.
Details of stock options awarded to the Named Executive Officers of the Company
in fiscal year 2000 are set forth on page 17 of this Proxy Statement. The value
of restricted stock equivalents credited to those executives is set forth in
the Summary Compensation Table on page 16 of this Proxy Statement.
Compensation for the Chief Executive Officer
Salary. Mr. Mulcahy was appointed Chief Executive Officer for the Company at
the time of the spin-off on April 1, 2000. He served as Chairman and Chief
Executive Officer of Eveready Battery Company, Inc. prior to that time. At the
time of the spin-off, it was determined that his salary should be maintained at
the same level during the second half of the fiscal year as it had been during
the first six months of the year, with the intention of having the Committee
review his salary in more depth at fiscal year end. The Committee has
determined his salary for fiscal year 2001 in accordance with the general
compensation philosophy described above under Salaries, and recommendations
from an independent compensation consultant.
The Committee awarded an annual bonus to Mr. Mulcahy based on the qualitative
and quantitative factors described under Annual Cash Bonus Award Programs
above. This included a subjective assessment of his performance as Chief
Executive Officer during the period since the spin-off of the Company, and
focused on several key elements. The Committee took into account his
25
<PAGE>
leadership during the transition period both before, and following, the spin-
off, and his ability to put together an operational team qualified to handle
the additional responsibilities associated with the Company's public status.
The Committee rated very highly his ability to maintain a positive business
momentum and market share growth during the transition period.
Stock Awards. In May, 2000 the Committee awarded Mr. Mulcahy options to
purchase Company stock, and the opportunity to receive restricted stock
equivalents upon his acquisition of an equal number of shares of the Company's
Common Stock, up to a limit of 130,000 equivalents. The equivalents are
convertible into shares of the Company's Common Stock. Details of those awards
are found in the Summary Compensation Table. In determining the size of these
awards, the Committee reviewed current data derived from a survey of peer
companies and reviewed the economic value of the median awards most recently
granted to the incumbent chief executive officers of those companies. With the
advice of outside consultants, this economic value was translated into an
equivalent value in options to purchase shares of Common Stock. The option
award granted to Mr. Mulcahy was substantially larger than average annual
grants for the peer companies reviewed because the Board wanted to provide
significant incentive to improve the Company's operating performance, and to
retain Mr. Mulcahy's services over the vesting period of the options. It is
contemplated that any additional stock options which may be granted to Mr.
Mulcahy in the next several years will be significantly smaller in size. The
restricted stock equivalents granted to Mr. Mulcahy are intended to motivate
him to make a significant personal investment in shares of the Company's Common
Stock, thus aligning his interests even closer with those of shareholders, and
to retain his services over the vesting period of the restricted stock
equivalents.
Deductibility of Certain Executive Compensation
A feature of the Omnibus Budget Reconciliation Act of 1993 sets a limit on
deductible compensation of $1,000,000 per year per person for those executives
designated as Named Executive Officers in the Proxy Statement. The Company has
mandated or reserved the right to mandate the deferral of certain bonus and
salary payments to such officers. While it is the general intention of the
Committee to meet the requirements for deductibility, the Committee may approve
payment of non-deductible compensation from time to time if unusual
circumstances warrant it. The Committee will continue to review and monitor its
policy with respect to the deductibility of compensation.
W. H. Danforth--Chairman R. David Hoover
F. Sheridan Garrison Joe R. Micheletto
26
<PAGE>
AUDIT COMMITTEE REPORT
The Audit Committee of the Company's Board of Directors consists entirely of
non-employee directors that are independent, as defined in Sections
303.01(B)(2)(a) and (3) of the New York Stock Exchange Listing Standards. A
copy of the Charter of the Audit Committee is attached to this Proxy Statement
as Exhibit B.
Management is responsible for the Company's internal controls and the financial
reporting process. The independent accountants are responsible for performing
an independent audit of the Company's consolidated financial statements in
accordance with generally accepted auditing standards and issuing a report
thereon. The Committee's responsibility is to monitor and oversee these
processes.
With respect to the Company's audited financial statements for the Company's
fiscal year ended September 30, 2000, management of the Company has represented
to the Committee that the financial statements were prepared in accordance with
generally accepted accounting principles and the Committee has reviewed and
discussed those financial statements with management. The Audit Committee has
also discussed with PricewaterhouseCoopers LLP, the Company's independent
accountants, the matters required to be discussed by Statement on Auditing
Standards No. 61 (Communication with Audit Committees) as modified or
supplemented.
The Audit Committee has received the written disclosures from
PricewaterhouseCoopers LLP required by Independence Standards Board Standard
No. 1 (Independence Standards Board Standard No.1, Independence Discussions
with Audit Committees), as modified or supplemented, and has discussed the
independence of PricewaterhouseCoopers LLP with members of that firm.
Based on the review and discussions referred to above, the Audit Committee
recommended to the Company's Board of Directors that the audited financial
statements for the fiscal year ended September 30, 2000 be included in the
Company's Annual Report on Form 10-K for that year.
Richard Liddy--Chairman William H. Danforth
F. Sheridan Garrison
27
<PAGE>
PERFORMANCE GRAPH
The graph below is presented in accordance with SEC requirements. You are
cautioned against drawing any conclusions from the data in the graph, as past
results do not necessarily indicate future performance. The graph does not
reflect the Company's forecast of future financial performance.
Despite anything to the contrary in any of the Company's previous SEC filings
under the Securities Act of 1933, as amended, or the Securities Exchange Act of
1934, as amended, that might incorporate future filings, including this Proxy
Statement, in whole or in part, the following graph as well as the Nominating
and Executive Compensation Committee Report on Executive Compensation and the
Audit Committee Report set forth above will not be incorporated by reference
into any such filings.
The line graph below compares the annual percentage change in cumulative total
shareholder return for the Company's Common Stock with the cumulative total
return of the Standard & Poor's Mid Cap Consumer Products and 400 Mid Cap
Indices.
Comparison of Cumulative Total Return on $100 Invested in Energizer Holdings,
Inc. Common Stock on April 3, 2000 vs. the S&P Mid Cap Consumer Products and
S&P 400 Mid Cap Indices
[Monthly Data Used to Graphically Compare Performance of Energizer Shares
to the S and P 400 Mid, S and P Mid Consumer Products April 2000 through
September 2000]
[LINE GRAPH]
[Initial Investment 100.00]
<TABLE>
<CAPTION>
ENERGIZER HOLDGS S&P 400 MIDCAP INDEX
------------------------ -------------------------
DATE Price Shares Value Price Shares Value
<S> <C> <C> <C> <C> <C> <C>
03/31/00 21.25 4.71 100.00 480.45 0.21 100.00
04/28/00 17.06 4.71 80.29 481.85 0.21 100.29
05/31/00 17.00 4.71 80.00 475.17 0.21 98.90
06/30/00 18.25 4.71 85.88 481.77 0.21 100.27
07/31/00 24.13 4.71 113.53 488.97 0.21 101.77
08/31/00 19.75 4.71 92.94 542.90 0.21 113.00
09/29/00 24.50 4.71 115.29 538.81 0.21 112.15
</TABLE>
<TABLE>
<CAPTION>
S&P MIDCAP CONSUMER
------------------------
DATE Price Shares Value
<S> <C> <C> <C>
03/31/00 119.48 0.84 100.00
04/28/00 113.51 0.84 95.00
05/31/00 109.65 0.84 91.77
06/30/00 105.18 0.84 88.03
07/31/00 120.60 0.84 100.94
08/31/00 110.70 0.84 92.65
09/29/00 118.63 0.84 99.29
</TABLE>
For the S&P Consumer Products Index, cumulative returns are measured for the
period April 1, 2000 through September 30, 2000, with the value of each index
set to $100 on April 1, 2000. Total return assumes reinvestment of dividends.
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SHAREHOLDER PROPOSALS FOR 2002 ANNUAL MEETING
Any proposals to be presented at the 2002 Annual Meeting of Shareholders must
be received by the Company, directed to the attention of the Secretary, no
later than August 16, 2001 in order to be included in the Company's proxy
statement and form of proxy for that meeting. Upon receipt of any proposal, the
Company will determine whether or not to include the proposal in the proxy
statement and proxy in accordance with regulations governing the solicitation
of proxies. The proposal must comply in all respects with the rules and
regulations of the Securities and Exchange Commission and the Bylaws of the
Company.
In order for a shareholder to nominate a candidate for director, under the
Company's Bylaws timely notice of the nomination must be received by the
Company in advance of the meeting. Ordinarily, such notice must be received not
less than 90 days before the meeting (but if the Company gives less than 90
days' (1) notice of the meeting or (2) prior public disclosure of the date of
the meeting, then such notice must be received within 7 days after notice of
the meeting is mailed or other public disclosure of the meeting is made), or
prior to October 30, 2001 for the 2002 Annual Meeting. The shareholder filing
the notice of nomination must describe various matters regarding the nominee,
including such information as name, address, occupation and shares held.
In order for a shareholder to bring other business before a shareholder
meeting, timely notice must be received by the Company prior to the time
described above. Such notice must include a description of the proposed
business, the reasons therefor, and other specified matters. These requirements
are separate from and in addition to the requirements a shareholder must meet
to have a proposal included in the Company's Proxy Statement.
In each case, the notice must be given to the Secretary of the Company, whose
address is 800 Chouteau, St. Louis, Missouri 63102. A copy of the Company's
Bylaws will be provided without charge upon written request to the Secretary.
By order of the Board of Directors,
/s/ T. L. Grosch
Timothy L. Grosch
Secretary
December 13, 2000
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EXHIBIT A
ENERGIZER HOLDINGS, INC.
2000 INCENTIVE STOCK PLAN
Section I. General Provisions
A. Purpose of Plan
The purpose of the Energizer Holdings, Inc. Incentive Stock Plan (the "Plan")
is to enhance the profitability and value of the Company for the benefit of its
shareholders by providing for stock options and other stock awards to attract,
retain and motivate officers and other key employees who make important
contributions to the success of the Company, and to provide equity-linked
compensation for directors.
B. Definitions of Terms as Used in the Plan
"Affiliate" shall mean any entity fifty percent or more of whose outstanding
voting securities, or beneficial ownership for entities other than
corporations, is owned, directly or indirectly, by the Company, or which
otherwise controls, is controlled by, or is under common control with, the
Company.
"Award" shall mean an Option, including a Restoration Option, or any Other
Stock Award, granted under the terms of the Plan.
"Award Agreement" shall mean the document or documents evidencing an Award
granted under the Plan.
"Board" shall mean the Board of Directors of the Company.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and the
regulations promulgated thereunder.
"Committee" shall mean the Nominating and Executive Compensation Committee of
the Board, or any successor committee the Board may designate to administer the
Plan. Each member of the Committee shall be (i) an "outside director" within
the meaning of Section 162(m) of the Code, subject to any transitional rules
applicable to the definition of outside director, and (ii) a "Non-Employee
Director" within the meaning of Rule 16b-3 under the Exchange Act, or otherwise
qualified to administer the Plan as contemplated by that Rule or any successor
Rule under the Exchange Act.
"Common Stock" shall mean Energizer Holdings, Inc. $.01 par value Common Stock,
and, at the discretion of the Board, may also mean any other authorized class
or series of common stock of an Affiliate or common stock of the Company
outstanding upon the reclassification of the Common Stock or any other class or
series of common stock, including, without limitation, by means of any stock
split, stock dividend, creation of targeted stock, or other distributions of
stock in respect of stock, or any reverse stock split, or by reason of any
recapitalization, merger or consolidation of the Company.
"Company" shall mean Energizer Holdings, Inc.
"Corporate Officer" shall mean any President, Chief Executive Officer,
Corporate Vice President, Controller, Secretary or Treasurer of the Company,
and any other officers designated as corporate officers by the Board.
"Director" shall mean any member of the Board.
"Employee" shall mean any person who is employed by the Company or an
Affiliate, including Corporate Officers.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"Fair Market Value" of the Common Stock shall mean the closing price as
reported on the Composite Tape of the New York Stock Exchange, Inc. on the date
that such Fair Market Value is to be determined, or if no shares were traded on
the determination date, the immediately preceding day on which the Common Stock
was traded, or the fair market value as determined by any other method adopted
by the Committee (or with respect to Awards granted to Directors, by the Board)
which the Committee or the Board, as the case may be, may deem appropriate
under the circumstances, or as may be required in order to comply with or to
conform to the requirements of applicable laws or regulations.
"Incentive Stock Options" shall mean Options that qualify as such under Section
422 of the Code.
"Non-Qualified Stock Options" shall mean Options that do not qualify as
Incentive Stock Options.
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"Option" shall mean the right, granted under the Plan, to purchase a specified
number of shares of Common Stock, at a fixed price for a specified period of
time.
"Other Stock Award" shall mean any Award granted under Section III of the Plan.
"Phantom Stock Option" shall mean an Option, granted under the Plan, which
provides that in lieu of receiving shares of Common Stock upon exercise, the
recipient will receive an amount equal to the excess of the Fair Market Value
of the Common Stock at exercise over the exercise price set forth in the Award
Agreement for the Phantom Stock Option.
"Restoration Option" shall mean an Option granted upon exercise of an
outstanding Option, provided that the exercise price is paid by tendering
previously owned shares of Common Stock by the Employee or Director.
"Restricted Stock Award" shall mean an Award of shares of Common Stock on which
are imposed restrictions on transferability or other shareholder rights,
including, but not limited to, restrictions which subject such Award to a
"substantial risk of forfeiture" as defined in Section 83 of the Code.
"Stock Appreciation Right" shall mean a right granted under the terms of the
Plan to receive an amount equal to the excess of the Fair Market Value of one
share of Common Stock as of the date of exercise of the Stock Appreciation
Right over the price per share of Common Stock specified in the Award Agreement
of which it is a part.
"Termination for Cause" shall mean an Employee's termination of employment with
the Company or an Affiliate because of the Employee's willful engaging in gross
misconduct, provided, however, that a Termination for Cause shall not include
termination attributable to (i) poor work performance, bad judgment or
negligence on the part of the Employee, (ii) an act or omission believed by the
Employee in good faith to have been in or not opposed to the best interests of
the Company and reasonably believed by the Employee to be lawful, or (iii) the
good faith conduct of the Employee in connection with a change of control of
the Company (including opposition to or support of such change of control).
C. Scope of Plan and Eligibility
Any Employee selected by the Committee, and any member of the Board, shall be
eligible for any Award contemplated under the Plan.
D. Authorization and Reservation
The Company shall establish a reserve of authorized shares of Common Stock in
the amount of 15,000,000 shares. This reserve shall represent the total number
of shares of Common Stock that may be presently issued pursuant to Awards,
including Restoration Options, subject to increase as described below. The
reserves may consist of authorized but unissued shares of Common Stock or of
reacquired shares, or both. Upon the forfeiture or expiration of an Award, all
shares of Common Stock not issued thereunder shall become available for the
granting of additional Awards. In addition, when a Restoration Option is
granted upon the tendering of shares of Common Stock in payment of the exercise
price of any Options, the reserve shall be increased in an amount equal to the
number of shares so tendered, and such additional reserved shares shall become
available for the granting of additional Awards. Awards under the Plan which
are payable in cash will not be counted against the reserve unless actual
payment is made in shares of Common Stock instead of cash.
E. Grant of Awards and Administration of the Plan
1. The Committee shall determine those Employees eligible to receive Awards and
the amount, type and terms of each Award, subject to the provisions of the
Plan, and it shall have the power to delegate responsibility to others to
select Employees other than Corporate Officers eligible to receive Awards and
the amount of each such Award, on terms determined by the Committee. The Board
shall determine the amount, type and terms of each Award to a Director, subject
to the provisions of the Plan. In making any determinations under the Plan, the
Committee or the Board, as the case may be, shall be entitled to rely on
reports, opinions or statements of officers or employees of the Company, as
well as those of counsel, public accountants and other professional or expert
persons. All determinations, interpretations and other decisions under or with
respect to the Plan or any Award by the Committee or the Board, as the case may
be, shall be final, conclusive and binding upon all parties, including without
limitation, the Company, any Employee or Director, and any other person with
rights to any Award under the Plan, and no member of the Board or the Committee
shall be subject to individual liability with respect to the Plan.
2. The Committee shall administer the Plan and, in connection therewith, it
shall have full power to construe and interpret the Plan, establish rules and
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regulations and perform all other acts it believes reasonable and proper,
including the power to delegate responsibility to others to assist it in
administering the Plan. To the extent, however, that such construction and
interpretation or establishment of rules and regulations relates to or affects
any Awards granted to Directors, the Board must ratify such construction,
interpretation or establishment.
3. During the term of the Plan, the aggregate number of shares of Common Stock
that may be the subject of performance-based Awards (as defined in Section
162(m) of the Code), excluding Restoration Options, that may be granted to an
Employee or Director during any one fiscal year may not exceed 1,900,000. The
aggregate number of shares of Common Stock that may be the subject of
Restoration Options that may be granted to an Employee or Director during any
one fiscal year may not exceed 950,000. These amounts are subject to adjustment
as provided in Section VI. F. below. The maximum number of shares with regard
to which Options and Stock Appreciation Rights may be granted to any individual
during any one fiscal year is 1,900,000. Any stock-related deferred
compensation will not be applied against this limit. Awards granted in a fiscal
year but cancelled during that same year will continue to be applied against
the annual limit for that year, despite cancellation.
4. Awards granted under the Plan shall be evidenced in the manner prescribed by
the Committee from time to time in accordance with the terms of the Plan. The
terms of each Award shall be set forth in an Award Agreement, and the Committee
may require that a recipient execute and deliver the Award Agreement to the
Company in order to evidence his or her acceptance of the Award.
Section II. Stock Options
A. Description
The Committee or, in the case of Awards granted to Directors, the Board, may
grant Incentive Stock Options and it may grant Non-Qualified Stock Options. At
the discretion of the Committee or the Board, in the case of Options granted to
Directors, an Employee or Director may also be eligible to receive a
Restoration Option in connection with an Option exercise, as more particularly
set forth below.
B. Terms and Conditions
1. Each Option shall be set forth in a written Award Agreement containing such
terms and conditions as the Committee, or in the case of Awards granted to
Directors, the Board, may determine, subject to the provisions of the Plan.
2. The option price of shares of Common Stock subject to any Option shall not
be less than the Fair Market Value of the Common Stock at the time that the
Option is granted.
3. The Committee, or in the case of Awards granted to Directors, the Board,
shall determine the vesting schedules and the terms, conditions and limitations
governing exercisability of Options granted under the Plan. Unless accelerated
in accordance with its terms, an Option may not be exercised until a period of
at least one year has elapsed from the date of grant, and the term of any
Option granted hereunder shall not exceed ten years.
4. The purchase price of any shares of Common Stock pursuant to exercise of any
Option must be paid in full upon such exercise. The payment shall be made in
cash, in United States dollars, or by tendering shares of Common Stock owned by
the Employee or Director (or the person exercising the Option). If shares of
Common Stock are tendered, they must have been owned at least six months prior
to the date of tender (or such other time period as may be determined by the
Committee).
5. The terms and conditions of any Incentive Stock Options granted hereunder
shall be subject to and shall be designed to comply with, the provisions of
Section 422 of the Code, and any other administrative procedures adopted by the
Committee from time to time. Incentive Stock Options may not be granted to any
person who is not an Employee at the time of grant.
C. Restoration Options
The Committee, or, in the case of Awards granted to Directors, the Board, may
provide either at the time of grant or subsequently that an option include the
right to acquire a Restoration Option. An option which provides for the grant
of a Restoration Option shall entitle the Employee or Director, upon exercise
of the option (in whole or in part) prior to termination of employment or
retirement or resignation as a Director, and payment of the exercise price in
shares of Common Stock, to receive a Restoration Option. In addition to any
other terms and conditions set forth in the Award Agreement, the Restoration
Option shall be subject to the following terms: (i) the number of shares of
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Common Stock which are the subject of the Restoration Option shall not exceed
the number of shares used to satisfy the option price of the original option
(which shares must have been owned for the time period described in B.4.
above), (ii) the grant date of the Restoration Option will be the date of
exercise of the original option, (iii) the exercise price per share shall be
the Fair Market Value on the Restoration Option grant date, (iv) the
Restoration Option, unless accelerated, in accordance with its terms, shall be
exercisable no earlier than one year after its grant date, (v) the term of the
Restoration Option shall not extend beyond the term of the original option, and
(vi) the Restoration Option will comply with all other provisions of the Plan.
The Committee, or in the case of Awards granted to Directors, the Board, shall,
in addition to all other powers granted to it under the Plan, have the power to
designate any limitations on the frequency of the grants of Restoration Options
to any Employee or Director, and may require, as a condition to the grant of
Restoration Options, that the recipient agree not to resell shares received
upon exercise of the original option (which original option may be a
Restoration Option) for a specific period.
Section III. Other Stock Awards
In addition to Options, the Committee or, in the case of Awards granted to
Directors, the Board, may grant Other Stock Awards payable in Common Stock or
cash, upon such terms and conditions as the Committee or Board may determine,
subject to the provisions of the Plan. Other Stock Awards may include, but are
not limited to, the following types of Awards:
A. Restricted Stock Awards
The Committee or, in the case of Awards granted to Directors, the Board, may
grant Restricted Stock Awards, each of which consists of a grant of shares of
Common Stock, subject to terms and conditions determined by the Committee or
Board in its sole discretion as well as to the provisions of the Plan. Such
terms and conditions shall be set forth in a written Award Agreement. The
shares of Common Stock granted will be restricted and may not be sold, pledged,
transferred or otherwise disposed of until the lapse or release of restrictions
in accordance with the terms of the Award Agreement and the Plan. Prior to the
lapse or release of restrictions, all shares of Common Stock which are the
subject of a Restricted Stock Award are subject to forfeiture in accordance
with Section IV of the Plan. Shares of Common Stock issued pursuant to a
Restricted Stock Award will be issued for no monetary consideration.
B. Stock Related Deferred Compensation
The Committee may, in its discretion, permit the deferral of payment of an
Employee's cash bonus or other cash compensation in the form of either Common
Stock or Common Stock equivalents (with each such equivalent corresponding to a
share of Common Stock), under such terms and conditions as the Committee may
prescribe in the Award Agreement relating thereto, including the terms of any
deferred compensation plan under which such Common Stock equivalents may be
granted. In addition, the Committee may, in any fiscal year, provide for an
additional matching deferral to be credited to an Employee's account under such
deferred compensation plans. The Committee may also permit account balances of
other cash or mutual fund accounts maintained pursuant to such deferred
compensation plans to be converted, at the discretion of the participant, into
the form of Common Stock equivalents, or to permit Common Stock equivalents to
be converted into account balances of such other cash or mutual fund accounts,
upon the terms set forth in such plans as well as such other terms and
conditions as the Committee may, in its discretion, determine. The Committee
may, in its discretion, determine whether any deferral in the form of Common
Stock equivalents, including deferrals under the terms of any deferred
compensation plans of the Company, shall be paid on distribution in the form of
cash or in shares of Common Stock.
C. Stock Appreciation Rights and Phantom Stock Options
The Committee, or in the case of Awards granted to Directors, the Board, may,
in its discretion, grant Stock Appreciation Rights or Phantom Stock Options to
Employees or Directors, subject to terms and conditions determined by the
Committee or Board in its sole discretion. Such terms and conditions shall be
set forth in a written Award Agreement. Each Stock Appreciation Right or
Phantom Stock Option shall entitle the holder thereof to elect, prior to its
cancellation or termination, to exercise such unit or option and receive either
cash or shares of Common Stock, or both, as the Committee or Board may
determine, in an aggregate amount equal in value to the excess of
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the Fair Market Value of the Common Stock on the date of such election over the
Fair Market Value on the date of grant of the Stock Appreciation Right or
Phantom Stock Option; except that if an option is amended to include Stock
Appreciation Rights, the designated Fair Market Value in the applicable Award
Agreement may be the Fair Market Value on the date that the Option was granted.
The Committee or Board may provide that a Stock Appreciation Right shall be
automatically exercised on one or more specified dates. Stock Appreciation
Rights may be granted on a "free-standing" basis or in conjunction with all or
a portion of the shares of Common Stock covered by an Option, either at the
time of grant of the Option or at any time thereafter during the term of the
Option. In addition to any other terms and conditions set forth in the Award
Agreement, Stock Appreciation Rights and Phantom Stock Options shall be subject
to the following terms: (i) Stock Appreciation Rights and Phantom Stock
Options, unless accelerated in accordance with their terms, may not be
exercised within the first year after the date of grant, (ii) the Committee or
Board, as the case may be, may, in its sole discretion, disapprove an election
to surrender any Stock Appreciation Right or Phantom Stock Option for cash in
full or partial settlement thereof, provided that such disapproval shall not
affect the recipient's right to surrender the Stock Appreciation Right or
Phantom Stock Option at a later date for shares of Common Stock or cash, and
(iii) no Stock Appreciation Right or Phantom Stock Option may be exercised
unless the holder thereof is at the time of exercise an Employee or Director
and has been continuously since the date the Stock Appreciation Right or
Phantom Stock Option was granted, except that the Committee or Board may permit
the exercise of any Stock Appreciation Right or Phantom Stock Option for any
period following the recipient's termination of employment or retirement or
resignation from the Board, not in excess of the original term of the Award, on
such terms and conditions as it shall deem appropriate and specify in the
related Award Agreement.
D. Performance-Based Other Stock Awards
The payment under any Other Stock Award that may be the subject of a
performance-based Award (as defined in Section 162(m) of the Code) (hereinafter
"Target Award") shall be contingent upon the attainment of one or more pre-
established performance goals established by the Committee in writing within
ninety (90) days of the commencement of the Target Award performance period (or
in the case of a newly hired Employee, before 25% of such Employee's service
for such Target Award performance period has lapsed). Such performance goals
will be based upon one or more of the following performance-based criteria: (a)
earnings per share; (b) income or net income; (c) return measures (including,
but not limited to, return on assets, capital, equity or sales); (d) cash flow
return on investments which equals net cash flows divided by owners equity; (e)
controllable earnings (a division's operating profit, excluding the
amortization of goodwill and intangible assets, less a charge for the interest
cost for the average working capital investment by the division); (f) operating
earnings or net operation earnings; (g) cost control; (h) share price
(including, but not limited to, growth measures); (i) total shareholder return
(stock price appreciation plus dividends); (j) economic value added; (k)
EBITDA; (l) operating margin (m) market share and (n) cash flow from
operations. Performance may be measured on an individual, corporate group,
business unit, or consolidated basis and may be measured absolutely or
relatively to the Company's peers. In establishing the Performance Goals, the
Committee may account for the effects of acquisitions, divestitures,
extraordinary dividends, stock split-ups, stock dividends or distributions,
issuances of any targeted stock, recapitalizations, warrants or rights
issuances or combinations, exchanges or reclassifications with respect to any
outstanding class or series of Stock, or a corporate transaction, such as any
merger of the Company with another corporation, any consolidation of the
Company and another corporation into another corporation, any separation of the
Company or its business units (including a spinoff or other distribution of
stock or property by the Company), any reorganization of the Company (whether
or not such reorganization comes within the definition of such term in Code
Section 368) or any partial or complete liquidation by the Company, or sale of
all or substantially all of the assets of the Company, or other extraordinary
items.
The Committee, in its discretion, may cancel or decrease an earned Target
Award, but, except as otherwise permitted by Treasury Regulation Section 1.162-
27(e)(2)(iii)(C), may not, under any circumstances, increase such award. Before
payments are made under a Target Award, the Committee shall certify in writing
that the performance goals justifying the payment under Target Award have been
met.
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Section IV. Forfeiture of Awards
A. Unless the Committee, or in the case of a Director, the Board, shall have
determined otherwise, the recipient of any Award pursuant to the Plan shall
forfeit the Award, to the extent not then payable or exercisable, upon the
occurrence of any of the following events:
1. The recipient is Terminated for Cause.
2. The recipient voluntarily terminates his or her employment other than by
retirement after attainment of age 62, or such other age as may be provided
for in the Award Agreement.
3. The recipient engages in competition with the Company or any Affiliate.
4. The recipient engages in any activity or conduct contrary to the best
interests of the Company or any Affiliate, including, but not limited to,
conduct that breaches the recipient's duty of loyalty to the Company or an
Affiliate or that is materially injurious to the Company or an Affiliate,
monetarily or otherwise. Such activity or conduct may include: (i)
disclosing or misusing any confidential information pertaining to the
Company or an Affiliate; (ii) any attempt, directly or indirectly, to
induce any Employee of the Company or any Affiliate to be employed or
perform services elsewhere, or (iii) any direct or indirect attempt to
solicit, or assist another employer in soliciting, the trade of any
customer or supplier or prospective customer of the Company or any
Affiliate.
B. The Committee or the Board, as the case may be, may include in any Award
Agreement any additional or different conditions of forfeiture it may deem
appropriate, and may waive any condition of forfeiture stated above or in the
Award Agreement.
C. In the event of forfeiture, the recipient shall lose all rights in and to
portions of the Award which are not vested or which are not exercisable. Except
in the case of Restricted Stock Awards as to which restrictions have not
lapsed, this provision, however, shall not be invoked to require any recipient
to transfer to the Company any Common Stock already received under an Award.
D. Such determinations as may be necessary for application of this Section,
including any grant of authority to others to make determinations under this
Section, shall be at the sole discretion of the Committee, or in the case of
Awards granted to Directors, of the Board, and such determinations shall be
conclusive and binding.
Section V. Beneficiary Designation; Death of Awardee
A. An Award recipient may file with the Committee a written designation of a
beneficiary or beneficiaries (subject to such limitations as to the classes and
number of beneficiaries and contingent beneficiaries as the Committee may from
time to time prescribe) to exercise, in the event of the death of the
recipient, an Option, Stock Appreciation Right or Phantom Stock Option, or to
receive, in such event, any Other Stock Awards. The Committee reserves the
right to review and approve beneficiary designations. A recipient may from time
to time revoke or change any such designation or beneficiary and any
designation of beneficiary under the Plan shall be controlling over any other
disposition, testamentary or otherwise. However, if the Committee shall be in
doubt as to the right of any such beneficiary to exercise any Option, Stock
Appreciation Right or Phantom Stock Option, or to receive any Other Stock
Award, the Committee may determine to recognize only an exercise by, or right
to receive of, the legal representative of the recipient, in which case the
Company, the Committee and the members thereof shall not be under any further
liability to anyone.
B. Upon the death of an Award recipient, the following rules shall apply:
1. An Option, to the extent exercisable on the date of the recipient's
death, may be exercised at any time within three years after the
recipient's death, but not after the expiration of the term of the Option.
The Option may be exercised by the recipient's designated beneficiary or
personal representative or the person or persons entitled thereto by will
or in accordance with the laws of descent and distribution, or by the
transferee of the Option in accordance with the provisions of Section VI.A.
2. In the case of any Other Stock Award, any shares of Common Stock or cash
payable shall be determined as of the date of the recipient's death, in
accordance with the terms of the Award Agreement, and the Company shall
issue such shares of Common Stock or pay such cash to the recipient's
designated beneficiary or personal representative or the person or persons
entitled thereto by will or in accordance with the laws of descent and
distribution.
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Section VI. Other Governing Provisions
A. Transferability
Except as otherwise provided herein, no Award shall be transferable other than
by beneficiary designation, will or the laws of descent and distribution, and
any right granted under an Award may be exercised during the lifetime of the
holder thereof only by Award Recipient or by his/her guardian or legal
representative; provided, however, that an Award recipient may be permitted, in
the sole discretion of the Committee or its delegee, to transfer to a member of
such recipient's immediate family, family trust or family partnership as
defined by the Committee or its delegee, an Option granted pursuant to Section
II hereof, other than an Incentive Stock Option, subject to such terms and
conditions as the Committee or its delegee, in their sole discretion, shall
determine.
B. Rights as a Shareholder
A recipient of an Award shall, unless the terms of the Award Agreement provide
otherwise, have no rights as a shareholder, with respect to any Options or
shares of Common Stock which may be issued in connection with an Award, until
the issuance of a Common Stock certificate for such shares, and no adjustment
other than as stated herein shall be made for dividends or other rights for
which the record date is prior to the issuance of such Common Stock
certificate. In addition, with respect to Restricted Stock Awards, recipients
shall have only such rights as a shareholder as may be set forth in the terms
of the Award Agreement.
C. General Conditions of Awards
No Employee, Director or other person shall have any rights with respect to the
Plan, the shares of Common Stock reserved or in any Award, contingent or
otherwise, until an Award Agreement shall have been delivered to the recipient
and all of the terms, conditions and provisions of the Plan applicable to such
recipient shall have been met.
D. Reservation of Rights of Company
Neither the establishment of the Plan nor the granting of an Award shall confer
upon any Employee any right to continue in the employ of the Company or any
Affiliate or interfere in any way with the right of the Company or any
Affiliate to terminate such employment at any time. No Award shall be deemed to
be salary or compensation for the purpose of computing benefits under any
employee benefit, pension or retirement plans of the Company or any Affiliate,
unless the Committee shall determine otherwise.
E. Acceleration
The Committee, or, with respect to any Awards granted to Directors, the Board,
may, in its sole discretion, accelerate the vesting or date of exercise of any
Awards.
F. Effect of Certain Changes
In the event of any extraordinary dividend, stock split-up, stock dividend,
issuance of targeted stock, recapitalization, warrant or rights issuance, or
combination, exchange or reclassification with respect to the Common Stock or
any other class or series of common stock of the Company, or consolidation,
merger or sale of all, or substantially all, of the assets of the Company, the
Committee or its delegee shall cause such equitable adjustments as it deems
appropriate to be made to the shares reserved under Section I.D of the Plan and
the limits on Awards set forth in Section I.E.3 of the Plan, and the Committee
or Board shall cause such adjustments to be made to the terms of outstanding
Awards to reflect such event and preserve the value of such Awards. In the
event that the Committee or Board determines that any such event has a minimal
effect on the value of Awards, they may elect not to cause any such adjustments
to be made. In all events, the determination of the Committee or Board or their
delegee shall be conclusive. If any such adjustment would result in a
fractional share of Common Stock being issued or awarded under this Plan, such
fractional share shall be disregarded.
G. Withholding of Taxes
The Company shall deduct from any payment, or otherwise collect from the
recipient, any taxes required to be withheld by federal, state or local
governments in connection with any Award. The recipient may elect, subject to
approval by the Committee, to have shares of Common Stock withheld by the
Company in satisfaction of such taxes, or to deliver other shares of Common
Stock owned by the recipient in satisfaction of such taxes. With respect to
Corporate Officers, Directors or other recipients subject to Section 16(b) of
the Exchange Act, the Committee or, with respect to Awards granted to
Directors, the Board, may impose such other conditions on the recipient's
election as it
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deems necessary or appropriate in order to exempt such withholding from the
penalties set forth in said Section. The number of shares to be withheld or
delivered shall be calculated by reference to the Fair Market Value of the
Common Stock on the date that such taxes are determined.
H. No Warranty of Tax Effect
Except as may be contained in the terms of any Award Agreement, no opinion is
expressed nor warranties made as to the tax effects under federal, foreign,
state or local laws or regulations of any Award granted under the Plan.
I. Amendment of Plan
The Board may, from time to time, amend, suspend or terminate the Plan in whole
or in part, and if terminated, may reinstate any or all of the provisions of
the Plan, except that (i) no amendment, suspension or termination may apply to
the terms of any Award (contingent or otherwise) granted prior to the effective
date of such amendment, suspension or termination, in a manner which would
reasonably be considered to be adverse to the recipient, without the
recipient's consent; (ii) except as provided in Section VI.F., no amendment may
be made to increase the number of shares of Common Stock reserved under Section
I.D of the Plan; (iii) except as provided in Section VI.F., no amendment may be
made to increase the limitations set forth in Section 1.E.3 of the Plan, and
(iv) no amendment may withdraw the authority of the Committee to administer the
Plan.
J. Construction of Plan
The place of administration of the Plan shall be in the State of Missouri and
the validity, construction, interpretation, administration and effect of the
Plan and of its rules and regulations, and rights relating to the Plan, shall
be determined solely in accordance with the laws of the State of Missouri,
without giving regard to the conflict of laws provisions thereof.
K. Unfunded Nature of Plan
The Plan, insofar as it provides for cash payments, shall be unfunded, and the
Company shall not be required to segregate any assets which may at any time be
awarded under the Plan. Any liability of the Company to any person with respect
to any Award under the Plan shall be based solely upon any contractual
obligations which may be created by the terms of any Award Agreement entered
into pursuant to the Plan. No such obligation of the Company shall be deemed to
be secured by any pledge of, or other encumbrance on, any property of the
Company.
L. Successors
All obligations of the Company under the Plan, with respect to any Awards
granted hereunder, shall be binding on any successor to the Company, whether
the existence of such successor is the result of a direct or indirect purchase,
merger, consolidation or otherwise, of all or substantially all of the business
and/or assets of the Company.
Section VII. Effective Date and Term
The Plan shall be effective April 1, 2000 and shall continue in effect until
December 31, 2009, when it shall terminate. Upon termination, any balances in
the reserve established under Section I.D shall be cancelled, and no Awards
shall be granted under the Plan thereafter. The Plan shall continue in effect,
however, insofar as is necessary, to complete all of the Company's obligations
under outstanding Awards or to conclude the administration of the Plan.
37
<PAGE>
EXHIBIT B
CHARTER OF THE ENERGIZER HOLDINGS, INC.
AUDIT COMMITTEE
The Audit Committee of the Board of Directors shall
PREFACE assist the Board in fulfilling its responsibilities with
respect to accounting and management controls, and
financial reporting.
Specifically, the Audit Committee is responsible for
overseeing that:
-- a system of internal controls is maintained throughout
the Company which protects the assets of the Company
on a reasonable and economic basis, provides for
proper authorization and recording of transactions,
and ensures financial information is reliable and
accurate; and
-- financial statements fairly present in all material
respects the financial condition and results of
operations of the Company in accordance with generally
accepted accounting principles.
MEMBERSHIP The Board of Directors shall appoint the Audit Committee
members, all of whom shall be Directors. The Board may
also appoint an individual, who need not be a Director,
to serve as Secretary to the Committee.
The Audit Committee shall consist of at least three
INDEPENDENCE Directors, including a Chairman, each of whom shall meet
the New York Stock Exchange requirements for membership
on audit committees of listed companies. Directors
ineligible for Audit Committee membership are directors
who are 1) affiliates of the Company or officers or
employees of the Company or its subsidiaries, 2) employed
as executives of another company at which any of the
Company's executives serve on that company's compensation
committee, or 3) not independent because of a business
relationship with the Company that the Board of Directors
has determined impairs the directors' independence.
TERM Each member of the Audit Committee shall hold office
until the earliest of the following shall occur: his or
her successor member is elected, or he or she dies,
resigns or is removed, or until he or she ceases to be a
Director.
DUTIES The Audit Committee will meet formally at least two times
a year with representatives from the independent public
accountant, and the Company's General Counsel, Secretary,
Corporate Controller, Chief Financial Officer and Chief
Executive Officer. Its duties are to:
1. Recommend annually to the Board of Directors the
selection or reappointment of the independent public
accountant;
2. Review the audit scopes and plans, and the associated
fees, of the independent public accountant with
management and the auditors;
3. Review the reports of the independent public
accountant relating to financial reporting practices
and reportable conditions in the internal control
structure;
4. Review with management and the independent public
accountant, the annual financial statements and
results of the independent accountant's audit,
including the independent accountants' judgment on
the quality and consistent application of accounting
principles, disclosures and underlying estimates in
the annual financial statements prior to filing with
the SEC.
38
<PAGE>
5. Review with management and the independent
accountants, either telephonically or in person, the
interim financial statements and results of the
independent accountants' review, including the
independent accountant's judgment on the quality and
consistent application of accounting principles,
disclosures and underlying estimates in the interim
financial statements prior to filing with the SEC.
The Chair of the Committee may represent the entire
Committee for purposes of this review.
6. Review the effect of new or proposed auditing,
accounting or reporting standards with management and
the independent public accountant;
7. Review the scope and fees of non-audit services and
other relationships of the independent public
accountant, and consider the possible effect of the
performance of those services on the independence of
the independent public accountant;
8. Review the organization and costs of the internal
auditing department, adequacy of its resources, and
productivity and competence of the audit staff;
9. Review the annual audit risk assessment and the
proposed audit plans of internal auditing with
management and the auditors;
10. Review the coverage and results of the internal
audits, including review of significant deficiencies
in internal controls and/or management improprieties
identified in such audit, together with management's
response thereto;
11. Review Company policies on internal controls, and
ethical and responsible business conduct, and review
the results and adequacy of programs and procedures
for determining compliance with such policies;
12. Review information concerning environmental, legal,
regulatory and other matters which may represent
material financial exposure;
13. Consider any other matters related to the oversight
responsibilities of the Audit Committee, as deemed
advisable or necessary by Company management, the
Board of Directors or the Audit Committee; and
14. Review and assess, at least annually, the adequacy of
this charter and submit the charter for approval to
the full Board at least every three years.
A majority of the members of the Audit Committee shall
QUORUM constitute a quorum for all purposes and the act of a
majority of the members present at any meeting at which a
quorum is present shall be the act of the Committee.
39
<PAGE>
[LANGUAGE ON FRONT OF PROXY CARD]
Proxy by Mail Please mark
your votes X
like this
ENERGIZER HOLDINGS, INC. COMMON STOCK
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR":
For All Withhold For All
Nominees Except
1. Election of Directors Nominees: 01 R. Pruzan,
------ ------ ----- 02 F.S. Garrison, 03 R.D
Hoover, 04 H.F. Johnson
FOR AGAINST ABSTAIN
2. Approval of 2000 To withhold authority to
Incentive Stock Plan ------ ------ ----- vote for any nominees
listed above, mark the
"For All Except" box
and write the name(s) of
the nominee(s) from whom
you wish to withhold
authority to vote in the
space provided below.
______________________________________________
Please be sure to sign Mark box at right if you plan to attend the
and date this Proxy Card. Annual Meeting on January 29, 2001.
IF YOU WISH TO VOTE ELECTRONICALLY
PLEASE READ THE INSTRUCTIONS BELOW
COMPANY NUMBER:
PROXY NUMBER:
ACCOUNT NUMBER:
SIGNATURE SIGNATURE DATE
PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR(S) HEREON. WHEN SIGNING AS ATTORNEY,
EXECUTOR, TRUSTEE, GUARDIAN, OR OFFICER OF A CORPORATION, PLEASE GIVE TITLE AS
SUCH. FOR JOINT ACCOUNTS, ALL NAMED HOLDERS SHOULD SIGN. IF YOU RECEIVE MORE
THAN ONE PROXY CARD, PLEASE SIGN ALL CARDS AND RETURN IN THE ACCOMPANYING
POSTAGE-PAID ENVELOPES.
--------------------------------------------------------------------------------
FOLD AND DETACH HERE AND READ THE REVERSE SIDE
VOTE BY TELEPHONE OR INTERNET
QUICK *** EASY *** IMMEDIATE
ENERGIZER HOLDINGS, INC.
* You can now vote your shares electronically through the Internet or the
telephone.
* This eliminates the need to return the proxy card.
* Your electronic vote authorizes the named proxies to vote your shares in
the same manner as if you marked, signed, dated, and returned the proxy
card.
TO VOTE YOUR PROXY BY INTERNET
-----------------------------------
WWW.ENERGIZER.COM
Have your proxy card in hand when you access the above website. Select
"ENR Shareholder Proxy Voting". You will be prompted to enter the company
number, proxy number, and account number to create an electronic ballot.
Follow the prompts to vote your shares.
TO VOTE YOUR PROXY BY MAIL
-------------------------------
Mark, sign, and date your proxy card above, detach it, and return it in the
postage-paid envelope provided.
TO VOTE YOUR PROXY BY PHONE
--------------------------------
1-800-293-8533
Use any touch-tone telephone to vote your proxy. Have your proxy card in hand
when you call. You will be prompted to enter the company number, proxy
number, and account number. Follow the voting instructions to vote your shares.
PLEASE DO NOT RETURN THE ABOVE CARD IF VOTED ELECTRONICALLY
-----------------------------------------------------------
<PAGE>
[LANGUAGE ON BACK OF PROXY CARD]
ENERGIZER HOLDINGS, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS ON JANUARY 29, 2001
P This proxy when properly executed will be voted in the manner
directed herein by the undersigned Shareholder. IF NO DIRECTION IS
R MADE, THIS PROXY WILL BE VOTED "FOR" ITEMS 1 AND 2. The undersigned
hereby appoints J.P. Mulcahy and H.L. Strachan as Proxies, with
O the power of substitution, to represent and to vote, as designated
below, all the shares of the undersigned held of record on November
X 24, 2000, at the Annual Meeting of Shareholders to be held on January
29, 2001 and any adjournments thereof.
Y (IMPORTANT - TO BE SIGNED AND DATED ON REVERSE SIDE)
This proxy covers all Energizer Holdings, Inc. Common Stock you own
in any of the following ways (provided the registrations are
identical):
- Shares held of record
- Energizer Holdings, Inc. Savings Investment Plan
- Ralston Purina Company Savings Investment Plan
------------------------------------------------------------------------------
FOLD AND DETACH HERE
2001 ANNUAL MEETING ADMISSION TICKET
ENERGIZER HOLDINGS, INC.
2001 ANNUAL MEETING OF SHAREHOLDERS
MONDAY, JANUARY 29, 2001
2:30 P.M. LOCAL TIME
THE SAINT LOUIS ART MUSEUM
1 FINE ARTS DRIVE
ST. LOUIS, MISSOURI 63110-1380
PLEASE PRESENT THIS TICKET FOR ADMITTANCE TO THE ANNUAL MEETING,
ADMITTANCE WILL BE BASED UPON AVAILABILITY OF SEATING.
<PAGE>
December 11, 2000
Dear Savings Investment Plan Participant:
Enclosed are a proxy statement, a proxy and an Annual Report for the Annual
Meeting of Shareholders of Energizer Holdings, Inc. to be held on January 29,
2001. The enclosed proxy relates to shares of Energizer Common Stock of which
you are the record holder and shares of Energizer Common Stock credited to your
account in the Energizer Holdings, Inc. Savings Investment Plan or the Ralston
Purina Company Savings Investment Plan (the "Plans")
The Trustee of each Plan will vote all shares of Energizer Common Stock held in
their respective Plan as of November 24, 2000. Shares credited to your account
as of November 16, 2000 will be voted in accordance with your instructions on
the enclosed proxy card. Any credited shares for which no instructions are
received by the Trustee, and any shares in the Plan that were credited between
November 16, 2000 and November 24, 2000, will be voted by the Trustee in the
same proportion as the shares for which instructions were received from all
participants in that Plan.
Please complete, sign and date the enclosed proxy. It should be returned, in
the post-paid envelope provided, to Continental Stock Transfer & Trust Company,
which acts as tabulator. Alternatively, you may vote by telephone or via
Internet. However you decide to vote, in order to provide the tabulator
sufficient time to tabulate the votes, it has been requested that all proxies be
returned, or votes be cast, as promptly as possible, but no later than January
25, 2001.
You may also have received additional proxy statements and proxies relating to
other shares of Energizer Common Stock held by you. These proxies are not
duplicates of the one enclosed and we ask that they also be voted pursuant to
the instructions enclosed with them.
/s/ J.P. Mulcahy
J.P. MULCAHY
Chief Executive Officer
