<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
HELENE CURTIS INDUSTRIES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2)
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3)
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:*
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
* Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
------------------------------------------------------------------------
<PAGE>
[LOGO]
HELENE CURTIS INDUSTRIES, INC.
325 N. WELLS STREET
CHICAGO, ILLINOIS 60610
- --------------------------------------------------------------------------------
May 25, 1994
Fellow Stockholders:
We are pleased to invite you to the Annual Meeting of Stockholders, to
be held Tuesday, June 28, 1994, at 10:00 A.M. in the Auditorium of the
Harold Washington Library Center (Plymouth Court entrance), 400 S. State
Street, Chicago, Illinois. Enclosed are the official notice of the meeting,
a proxy statement and a form of proxy.
At the Annual Meeting, the stockholders will be asked to elect three
directors, to ratify and approve the material terms of each of the Company's
Executive Management Incentive Plan and the Company's 1994 Stock
Appreciation Right Plan and to ratify the appointment of the Company's
certified public accountants for this year, as described in the formal
notice of meeting and proxy statement on the following pages.
We hope that you will attend the Annual Meeting and encourage you to
read the accompanying statement carefully.
YOUR VOTE IS VERY IMPORTANT. TO ENSURE THAT YOUR STOCK IS REPRESENTED,
WE URGE YOU TO VOTE, SIGN AND MAIL THE ENCLOSED PROXY IN THE ENVELOPE
PROVIDED, WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE ANNUAL MEETING.
Sincerely,
Gerald S. Gidwitz Ronald J. Gidwitz
Chairman President
<PAGE>
HELENE CURTIS INDUSTRIES, INC.
325 N. WELLS STREET
CHICAGO, ILLINOIS 60610
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Notice is hereby given that the Annual Meeting of Stockholders of Helene
Curtis Industries, Inc., a Delaware corporation, will be held in the Auditorium
of the Harold Washington Library Center (Plymouth Court entrance), 400 S. State
Street, on Tuesday, June 28, 1994, at 10:00 A.M., Chicago time, for the
following purposes:
1. To elect three directors of the Company for a three-year
term expiring at the annual meeting of stockholders to be
held in 1997 and until their successors are elected and
have been qualified.
2. To ratify and approve the material terms of the Company's
Executive Management Incentive Plan, which authorizes a
performance-based bonus for certain executive officers.
3. To ratify and approve the material terms of the Company's
1994 Stock Appreciation Right Plan, which authorizes the
issuance of up to 2,000,000 stock appreciation rights.
4. To ratify and approve the appointment of independent
accountants for the Company for the fiscal year ending
February 28, 1995.
5. To transact such other business as may properly come
before the meeting.
Only stockholders of record at the close of business on May 4, 1994, are
entitled to vote at the Annual Meeting or any adjournment thereof.
By order of the Board of Directors
Roy A. Wentz, Secretary
Chicago, Illinois
May 25, 1994
<PAGE>
HELENE CURTIS INDUSTRIES, INC.
325 N. WELLS STREET
CHICAGO, ILLINOIS 60610
- ---------------------
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS--JUNE 28, 1994
This Proxy Statement is furnished in connection with the solicitation by the
Board of Directors of the Company of Proxies for use at the Annual Meeting of
Stockholders to be held on June 28, 1994. All Proxies duly executed and received
will be voted on all matters presented at the meeting. Where a specification as
to any matter is indicated, the Proxy will be voted in accordance with such
specification. Where no specification is indicated, the Proxy will be voted for
the named nominees and in favor of all three proposals. The Board of Directors
knows of no other matter to be brought before the meeting; however, if other
matters should come before the meeting it is intended that the holders of the
Proxies will vote thereon at their discretion.
The Company will pay the expense of soliciting Proxies. Solicitation will be
made by mail, but may in some cases also be made by telephone or personal call
by officers, directors or Company employees who will not be specially
compensated for such solicitation. This Proxy Statement and accompanying Proxy
were mailed on or about May 25, 1994, together with a copy of the Company's
Annual Report for the fiscal year ended February 28, 1994.
The total number of voting securities of the Company issued and outstanding
as of May 4, 1994 was 6,806,791 shares of Common Stock (excluding 1,114,680
shares held in the treasury) and 3,072,669 shares of Class B Common Stock. Only
stockholders of record as of the close of business on May 4, 1994, will be
entitled to vote at the Annual Meeting. Each share of Common Stock is entitled
to one vote on each matter presented to stockholders and each share of Class B
Common Stock is entitled to ten votes on each matter presented to stockholders.
The Common Stock and the Class B Common Stock will vote together as a single
class on all proposals presented in the Proxy Statement. The aggregate number of
votes entitled to be cast by all stockholders present in person or represented
by Proxy at the Annual Meeting will be counted for purposes of determining the
presence of a quorum. If a quorum is present at the meeting, the three persons
receiving the most votes will be elected as directors, irrespective of the
number of shares voted. Shares not voted, whether by abstention, broker
non-vote, or otherwise, have no impact on the election of directors. The
affirmative vote of a majority of shares present at the meeting in person or by
proxy is necessary to ratify and approve the material terms of the Executive
Management Incentive Plan and the 1994 Stock Appreciation Right Plan and ratify
the appointment of the Company's independent accountants. Abstentions and broker
non-votes on these items are not counted as affirmative or negative votes and
are not counted in determining the amount of shares entitled to vote.
<PAGE>
A Proxy may be revoked at any time before it is voted by giving written
notice of revocation to the Secretary of the Company, by submission of a
subsequent Proxy or by attending and voting in person at the Annual Meeting.
PRINCIPAL SECURITY HOLDERS
COMMON STOCK. The following table sets forth the only persons known by the
Board of Directors to be the beneficial owners of more than 5% of the Company's
Common Stock as of December 31, 1993, except as otherwise indicated, based
solely on filings made with the Securities and Exchange Commission:
<TABLE>
<CAPTION>
NAME AND ADDRESS OF COMMON SHARES
BENEFICIAL OWNER BENEFICIALLY OWNED
- ----------------------------------------- ------------------------
PERCENT OF
NUMBER CLASS
--------- -------------
<S> <C> <C>
Neuberger & Berman(1) 388,132 5.75
605 Third Avenue
New York, NY 10158
Southeastern Asset Management, Inc.(2) 381,400 5.6
860 Ridgelake Boulevard, Suite 301
Memphis, TN 38120
Shamrock Holdings of California, Inc.(3) 373,900 5.5
4444 Lakeside Drive
P.O. Box 7774
Burbank, CA 91510
</TABLE>
- ---------
(1) Neuberger & Berman has shared dispositive power with respect to all of
the reported shares, sole power to vote 195,400 of such shares and
shared power to vote 32,000 shares.
(2) Southeastern Asset Management, Inc. has shared voting and shared
dispositive power with respect to 145,000 shares and sole voting and
sole dispositive power with respect to 236,400 shares.
(3) Information indicated as of May 13, 1994, as reflected by the Schedule
13D filed by Shamrock Holdings of California, Inc. on that date.
Shamrock Holdings of California, Inc. has sole power to vote and sole
dispositive power with respect to 373,900 shares.
2
<PAGE>
CLASS B COMMON STOCK. The following table sets forth the only persons known
by the Board of Directors to be the beneficial owners of more than 5% of the
Company's Class B Common Stock as of May 4, 1994:
<TABLE>
<CAPTION>
CLASS B COMMON SHARES
NAME AND ADDRESS OF BENEFICIALLY
BENEFICIAL OWNER OWNED AS OF MAY 4, 1994
- --------------------------------------- -------------------------
PERCENT OF
NUMBER CLASS
---------- -------------
<S> <C> <C>
Gidwitz Family Group* 3,042,207 99.0
325 N. Wells St.
Chicago, Illinois 60610
</TABLE>
- ---------
* The Gidwitz Family Group consists of (i) Gerald S. Gidwitz, his
children, their spouses, grandchildren of Gerald S. Gidwitz and various
trusts, partnerships and other entities holding shares for the benefit
of members of the Gerald S. Gidwitz Family, and (ii) Joseph L. Gidwitz,
his children, their spouses, grandchildren of Joseph L. Gidwitz and
various trusts, partnerships and other entities holding shares for the
benefit of members of the Joseph L. Gidwitz Family. The Gidwitz Family
Group has shared voting and shared dispositive power with respect to all
reported shares which are held of record as follows:
(a) 2,096,206 shares owned of record by the Gidwitz Family Partnership,
an Illinois general partnership. Certain members of the Gidwitz
Family Group contributed the entire amount of these shares in 1991
in exchange for a pro rata interest in said partnership. Under the
terms of the partnership agreement, five partners are designated as
managing partners, and, by their majority vote, have the dispositive
and voting rights to such shares. Three of the managing partners,
Gerald S. Gidwitz, Joseph L. Gidwitz and Ronald J. Gidwitz, who own
interests in the partnership of 5.8%, 5.5% and 15.1%, respectively,
are directors of the Company.
(b) 584,900 shares owned of record by HCI Partnership, an Illinois
general partnership. Certain members of the Gidwitz Family Group
contributed the entire amount of these shares in 1988 and 1991 in
exchange for a pro rata interest in said partnership. Management of
the partnership is identical to that of the Gidwitz Family
Partnership. Gerald S. Gidwitz, Joseph L. Gidwitz and Ronald J.
Gidwitz own interests in the partnership of .03%, 12.0% and 11.9%,
respectively.
(c) 181,973 shares owned by various trusts for the benefit of the
children and grandchildren of Gerald S. Gidwitz and Joseph L.
Gidwitz.
(d) 120,000 shares owned of record and beneficially by Ronald J.
Gidwitz, which shares are set forth under SECURITY OWNERSHIP OF
MANAGEMENT.
(e) 59,128 shares owned by family members of Gerald S. Gidwitz and
Joseph L. Gidwitz.
3
<PAGE>
The Gidwitz Family Group may cast 81.3% of the total votes represented by
all the outstanding Common Stock and Class B Common Stock as of May 4, 1994. The
Gidwitz Family Group has advised the Company that they intend to vote all of
their shares for the named nominees and in favor of all three proposals.
Members of the Gidwitz Family Group own 84,611 shares of Common Stock,
including those shares set forth under SECURITY OWNERSHIP OF MANAGEMENT.
Assuming that all Class B Common Stock owned by the Gidwitz Family Group was
converted to Common Stock and that no other Class B Common Stock was so
converted, the percentage ownership of Common Stock of the Gidwitz Family Group
would be 31.75%.
SECURITY OWNERSHIP OF MANAGEMENT
As set forth under PRINCIPAL SECURITY HOLDERS, as of May 4, 1994, the
Gidwitz Family Group, which includes partnerships of, and trusts for the benefit
of, Gerald S. Gidwitz, Joseph L. Gidwitz and members of their respective
families, including Ronald J. Gidwitz, owned an aggregate of 3,042,207 shares of
Class B Common Stock. The following table excludes the shares held by such
partnerships and trusts as well as shares allocated to each individual's account
pursuant to the Company's Employee Stock Ownership and Employee Stock Purchase
Plans, but otherwise shows the shares held beneficially at that date by each
director, by the named executive officers, and by all directors and executive
officers as a group.
<TABLE>
<CAPTION>
SHARES OF
PERCENT CLASS B PERCENT
SHARES OF OF COMMON OF
NAME COMMON STOCK* CLASS(1) STOCK CLASS
- ------------------------------------ ------------- -------- -------------- -------
<S> <C> <C> <C> <C>
Marshall L. Burman.................. 7,000(2) -- -- --
Frank W. Considine.................. 400(2) -- -- --
Charles G. Cooper................... 73,928(3) 1.09 -- --
Gerald S. Gidwitz................... -- -- --(4) --
Joseph L. Gidwitz................... --(6) -- --(4)(5) --
Ronald J. Gidwitz................... 25,000(7) -- 120,000(4) 3.91
Michael Goldman..................... 52,962(8) -- -- --
Colin J. Morgan..................... 11,239(9)
Abbie J. Smith...................... 500(10) -- -- --
Gilbert P. Smith.................... 49,233(11) -- -- --
John C. Stetson..................... 2,000(2) -- -- --
All executive officers and directors
as a group (20 persons)........... 364,249(12) 5.35 120,000 3.91
</TABLE>
- ---------
* The beneficial ownership (including percent of class) shown in the table
with respect to Common Stock does not reflect the shares of Common Stock that
could be acquired upon the conversion of shares of Class B Common Stock into
shares of Common Stock.
4
<PAGE>
(1) The shares owned, in each case except as otherwise indicated, constitute
less than 1% of the outstanding shares of the Company's Common Stock.
(2) Excludes 16,000 shares currently acquirable or acquirable within 60 days
of the date of this Proxy Statement pursuant to options granted under the
Company's Directors Stock Option Plan, as adjusted for a stock split in 1989.
(3) Excludes 17,128 shares acquirable by Mr. Cooper pursuant to currently
exercisable options granted under the Company's 1983 and 1992 Stock Option
Plans.
(4) Excludes shares attributable to ownership interest in the Gidwitz Family
Partnership and the HCI Partnership as set forth in PRINCIPAL SECURITY HOLDERS.
(5) Excludes 37,732 shares held as trustee for the benefit of Mr. Gidwitz's
children and grandchildren.
(6) Excludes 34,211 shares held as trustee for the benefit of Mr. Gidwitz's
children and grandchildren.
(7) Excludes 37,975 shares acquirable by Mr. Gidwitz pursuant to currently
exercisable options granted under the Company's 1983 and 1992 Stock Option
Plans.
(8) Excludes 16,625 shares acquirable by Mr. Goldman pursuant to currently
exercisable options granted under the Company's 1983 and 1992 Stock Option
Plans.
(9) Excludes 11,225 shares acquirable by Mr. Morgan pursuant to currently
exercisable options granted under the Company's 1983 and 1992 Stock Option
Plans.
(10) Excludes 6,400 shares currently acquirable or acquirable within 60 days
of the date of this Proxy Statement pursuant to options granted under the
Company's Directors Stock Option Plan.
(11) Excludes 16,625 shares acquirable by Mr. Smith pursuant to currently
exercisable options granted under the Company's 1983 and 1992 Stock Option Plans
and 16,000 shares of restricted Common Stock issued under the 1992 Stock Option
Plan which remain restricted in compliance with that plan.
(12) Excludes 651 and 2,350 shares credited to all members of the group
under the Company's Employee Stock Ownership and Employee Stock Purchase Plans,
respectively, 197,366 shares acquirable by members of the group pursuant to
currently exercisable options granted under the Company's 1983, 1991 and 1992
Stock Option Plans and 24,000 shares of restricted Common Stock issued under the
1992 Stock Option Plan which remain restricted in compliance with that plan.
5
<PAGE>
NOMINEES FOR DIRECTORS
Term Expiring in 1997
Marshall L. Burman, 64, is counsel to the law firm of Wildman, Harrold,
Allen & Dixon, which provided legal services to the Company during the fiscal
year ended February 28, 1994. Until January 1, 1992, he was a senior partner in
the law firm of Arvey, Hodes, Costello & Burman. He has been a director of the
Company since 1980. Mr. Burman is also Chairman of the Board of Directors of The
Illinois State Board of Investments, a director of CFI Industries, Inc., and a
director of Safecard Services, Inc.
Frank W. Considine, 72, is Honorary Chairman of the Board of Directors and
Chairman of the Executive Committee of American National Can Company, a company
engaged in the manufacture and sale of packaging products, from which the
Company has purchased packaging materials in the ordinary course of business.
From 1983 to 1990, he was Chairman of the Board of Directors and, from 1973 to
1988, he was President and Chief Executive Officer of American National Can
Company and was Vice Chairman of the Board of Directors of Triangle Industries,
Inc. from 1985 to 1988. He has been a director of the Company since 1988. He is
a director of Encyclopedia Brittanica, Inc., IMC Fertilizer Group, Pechiney
International, S.A., Schwitzer, Inc. and Scotsman Industries, Inc., and is a
member of the Board of Governors of the Midwest Stock Exchange.
Ronald J. Gidwitz, 49, is President and Chief Executive Officer of the
Company. He has been a director of the Company since 1974. Mr. Gidwitz is a
director of Continental Materials Corporation, a director of American National
Can Company and he is the Chairman of the Board of Trustees of the City Colleges
of Chicago. He is the son of Gerald S. Gidwitz.
CONTINUING DIRECTORS
Term Expiring in 1995
Joseph L. Gidwitz, 89, is Vice Chairman of the Board of Directors of the
Company. He has been a director of the Company since 1946. He is also Vice
Chairman of the Board of Directors of Continental Materials Corporation.
Michael Goldman, 57, is Executive Vice President and Chief Operating Officer
of the Company. He has been employed by the Company for more than 30 years and a
director of the Company since 1989.
Gilbert P. Smith, 57, is Executive Vice President of the Company. He also
serves as President of the Company's Helene Curtis U.S.A. business unit. He has
been employed by the Company for more than 15 years and a director of the
Company since 1989.
Term Expiring in 1996
Charles G. Cooper, 66, is Senior Vice President of the Company, responsible
for business development. Until his election to this position effective March
30, 1993, he previously served as Executive Vice President and Chief Operating
6
<PAGE>
Officer of the Company. Mr. Cooper has been employed by the Company for more
than 40 years and a director of the Company since 1984. He is also a director of
Sportmart, Inc.
Gerald S. Gidwitz, 87, is Chairman of the Board of Directors of the Company.
He has been a director of the Company since 1928. He is the brother of Joseph L.
Gidwitz.
Abbie J. Smith, Ph.D., 41, is Professor of Accounting at the Graduate School
of Business of the University of Chicago, a position she has held since 1989.
She was previously Associate Professor of Accounting at the University. She has
been a director of the Company since 1990.
John C. Stetson, 73, is President of J.C. Stetson, Inc., a private venture
capital firm. Mr. Stetson was Secretary of the Air Force from 1977 to 1979 and
prior to his government assignment, was President of AB Dick Company. He has
been a director of the Company since 1982. Mr. Stetson is also a director of
Laser Technology, Inc., NIBCO, Inc., Chicago Tube and Iron Company and
Madison-Kipp Corporation, and a director emeritus of Kemper Corporation and
Kemper National Insurance Co.
THE BOARD OF DIRECTORS
The Board of Directors has audit, executive, and compensation and stock
option committees. The Board has no standing nominating committee, but acts as a
whole with respect to nominees for the Board of Directors.
The Audit Committee, consisting of Messrs. Burman and Stetson and Dr. Smith,
met four times during the fiscal year ended February 28, 1994. The function of
the Audit Committee is to review and make recommendations regarding: engagement
of an independent public accounting firm; the scope of the independent
accountants' audit procedures; the adequacy and implementation of internal audit
controls; regulatory compliance procedures; and such other matters relating to
the Company's financial affairs and accounts as the Audit Committee deems
desirable.
The Executive Committee, consisting of Messrs. Gerald S. Gidwitz, Joseph L.
Gidwitz and Ronald J. Gidwitz, met three times during the fiscal year ended
February 28, 1994. The Executive Committee, during the interval between meetings
of the Board of Directors, may exercise all of the authority of the Board in the
management of the Company, except as otherwise provided in the Company's By-Laws
or by applicable law. It is also responsible for administering the Directors
Stock Option Plan.
The Compensation and Stock Option Committee, consisting of Messrs. Burman,
Considine and Stetson, is responsible for determining salary and other
compensation of the principal officers of the Company and for administering
certain of the Company's incentive plans including the Company's executive
management incentive, stock option and stock appreciation right plans. The
Committee met three times during the fiscal year ended February 28, 1994.
7
<PAGE>
During the fiscal year ended February 28, 1994, the Board of Directors of
the Company met six times. Each director, except for John C. Stetson, was
present at more than seventy-five percent of the aggregate number of Board
meetings and the total number of meetings held by committees of the Board on
which such director served.
Directors who are not Company employees receive an annual fee of $14,000 and
a fee of $2,000 for each Board meeting attended and $1,000 for each committee
meeting attended, plus travel expenses. In addition, each non-employee director
is a participant in the Company's Directors Stock Option Plan, which was
approved by the stockholders at the 1988 Annual Meeting. Under this Plan each
such director at the time of the Plan's adoption or who was subsequently elected
to the Board of Directors was granted an option to purchase 8,000 shares of
Common Stock, exercisable in five equal annual installments commencing one year
after the date of grant. The exercise price for such options is the fair market
value of the Company's stock on the date of grant. All options expire ten years
from the date of grant or earlier in the event a director ceases to serve in
that capacity or becomes an employee of the Company.
8
<PAGE>
EXECUTIVE OFFICER COMPENSATION
The following tables and notes present the compensation provided by the
Company to its Chief Executive Officer and the Company's four next most highly
compensated executive officers who served as executive officers at the end of
fiscal 1994.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
-----------------------------------
ANNUAL COMPENSATION AWARDS
---------------------------- ----------------------- PAYOUTS
OTHER SECURITIES ---------
ANNUAL RESTRICTED UNDERLYING LONG-TERM ALL OTHER
COMPEN- STOCK OPTIONS/ INCENTIVE COMPEN-
NAME/PRINCIPAL SALARY BONUS SATION(2) AWARDS SARS PAYOUTS SATION(4)
POSITION/YEAR (1) $ $ $ $ # $ $
- ------------------------- -------- -------- -------- ---------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Ronald J. Gidwitz
President and Chief
Executive Officer
1994..................... $715,000 $ 0 -- $0 0 $ 0 $123,268
1993..................... 575,000 366,300 -- 0 21,100(3) 526,500(5) 97,564
1992..................... 525,000 323,400 * 0 22,800(3) 59,450(6) *
Charles G. Cooper
Senior Vice President
1994..................... $347,000 $ 0 -- $0 0 $ 0 $ 86,789
1993..................... 415,000 257,000 -- 0 15,300 415,350(5) 81,925
1992..................... 384,000 238,700 * 0 16,600 47,850(6) *
Michael Goldman
Executive Vice President
and Chief Operating
Officer
1994..................... $371,000 $ 0 -- $0 0 $ 0 $ 69,557
1993..................... 310,000 178,400 -- 0 8,900 310,050(5) 58,075
1992..................... 287,000 159,200 * 0 9,600 35,525(6) *
Colin J. Morgan
Senior Vice President
1994..................... $248,000 $117,499 -- $0 0 $ 0 $ 54,849
1993..................... 215,000 123,800 -- 0 6,200 210,600(5) 49,116
1992..................... 195,000 108,000 * 0 6,500 23,925(6) *
Gilbert P. Smith
Executive Vice President
1994..................... $357,000 $ 0 -- $832,500(7) 0 $ 0 $ 69,723
1993..................... 310,000 180,900 -- 0 8,900 310,050(5) 59,318
1992..................... 287,000 162,400 * 0 9,600 34,800(6) *
</TABLE>
- ---------
(1) All information is provided for each of the last three fiscal years
ending on the last day of February for the year indicated.
(2) The only type of Other Annual Compensation for each of the named
officers was in the form of perquisites, and was less than the level required
for reporting.
(3) Stock appreciation rights issued in tandem with grant of stock options.
(4) Consists of the following: (a) contributions by the Company to the
executives' accounts under the Company's Profit Sharing Retirement Savings and
Supplemental Profit Sharing and Retirement Savings Plans and (b) premiums paid
pursuant to the Company's Executive Death Benefit Agreement. The values for
9
<PAGE>
each of the two component amounts for fiscal 1994 for each executive officer are
as follows: Mr. Gidwitz, (a) $120,383 and (b) $2,885; Mr. Cooper, (a) $76,575
and (b) $10,214; Mr. Goldman, (a) $64,377 and (b) $5,180; Mr. Morgan, (a)
$43,653 and (b) $11,196; and Mr. Smith, (a) $63,547 and (b) $6,176.
(5) Stockholder Value Creation Plan award granted in 1991 and earned over
the three-year performance period from fiscal 1991 through fiscal 1993.
(6) Stockholder Value Creation Plan award granted in 1990 and earned over
the three-year performance period from fiscal 1990 through fiscal 1992.
(7) Net value of 20,000 shares of restricted stock based on the market price
of the Common Stock on the date granted. As of February 28, 1994, Mr. Smith held
20,000 restricted shares with a value of $515,000 based on the market price on
that date. Mr Smith has the right to receive dividends on the restricted shares.
* In accordance with transitional provisions of the revised rules on
executive officer and director compensation disclosure, amounts of Other Annual
Compensation and All Other Compensation are not included for fiscal 1992.
The following table sets forth the number of shares for which stock options
were exercised during the last fiscal year, the value realized, the number of
shares for which options were outstanding and the value of those options as of
the fiscal year-end.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
SECURITIES UNEXERCISED IN-
UNDERLYING THE-MONEY
OPTIONS/SARS OPTIONS/SARS AT
AT FY-END (#) FY-END ($)
-------------- -------------------
SHARES ACQUIRED ON EXERCISABLE/ EXERCISABLE/
NAME EXERCISE (#) VALUE REALIZED $ UNEXERCISABLE UNEXERCISABLE (*)
- ---------------------------- ------------------- ----------------- -------------- -------------------
<S> <C> <C> <C> <C>
Ronald J. Gidwitz........... 0 $ 0 32,275/27,225 $ 0/0
Charles G. Cooper........... 0 0 12,978/19,775 0/0
Michael Goldman............. 0 0 14,225/11,475 0/0
Colin J. Morgan............. 7,400 70,781 9,600/ 7,900 0/0
Gilbert P. Smith............ 0 0 14,225/11,475 0/0
</TABLE>
- ---------
(*) These columns represent the difference on February 28, 1994 between the
market price of the Common Stock and the option exercise price. The exercise
price of all unexercised options exceeded the market price of the Common Stock
on February 28, 1994, and therefore the options had no value.
10
<PAGE>
EXECUTIVE PENSION BENEFITS
The table shown below identifies estimated benefits which would be payable
annually at age 65 under a straight life annuity option:
PENSION PLAN TABLE
<TABLE>
<CAPTION>
REMUNERATION YEARS OF SERVICE
- ----------- -----------------------------------------------------
15 20 25 30 35
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
$200,000 $ 40,020 $ 53,360 $ 66,700 $ 80,040 $ 93,380
250,000 50,025 66,700 83,375 100,050 116,725
300,000 60,030 80,040 100,050 120,060 140,070
350,000 70,035 93,380 116,725 140,070 163,415
400,000 80,040 106,720 133,400 160,080 186,760
450,000 90,045 120,060 150,075 180,090 210,105
500,000 100,050 133,400 166,750 200,100 233,450
550,000 110,055 146,740 183,425 220,110 256,795
</TABLE>
Benefits are payable under the Executive Pension Plan to executive officers
who are employed by the Company or its subsidiaries for 35 years, with partial
benefits available for service of between 15 and 35 years. Pension benefits are
determined by the average of each executive officer's highest five years'
salaries over the last ten years, excluding bonuses, insurance premiums which
constitute taxable income for federal income tax purposes and deferred
compensation. The executive officers named in the Summary Compensation Table
have the following years of credited service for pension plan purposes: Charles
G. Cooper, 41 years; Ronald J. Gidwitz, 26 years; Michael Goldman, 32 years;
Colin J. Morgan, 7 years; and Gilbert P. Smith, 17 years. Benefits under the
plan are not subject to deduction for Social Security, but are offset for
amounts payable under the Company's Profit Sharing and Retirement Savings Plan
and a former plan which was terminated as to future contributions.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
TO OUR STOCKHOLDERS:
The Compensation and Stock Option Committee (the "Committee") of the Board
of Directors, is composed of three directors of the Company who are not current
or former employees or officers of the Company and are "disinterested persons"
within the meaning of the Securities and Exchange Commission rules. The
Committee is generally responsible for administering the Company's executive
compensation programs. In particular, the Committee reviews and approves the
compensation of the Company's most highly compensated executives, including the
named executive officers whose compensation is detailed in this Proxy Statement.
COMPENSATION PHILOSOPHY
The Company's executive compensation program is intended to attract,
develop, reward and retain the highest quality management talent. It is the
philosophy of the Company that executive compensation should recognize an
individual's contribution to the Company and be competitive with compensation
offered by
11
<PAGE>
other major consumer goods companies. At the same time, the Company believes
that executive compensation should also be closely linked to the Company's
financial performance. Accordingly, a significant portion of each executive's
compensation is dependent upon achieving objective, pre-determined financial
goals. Therefore, in years in which these performance goals are achieved or
exceeded, executive compensation will be higher than in years in which the
performance is below expectations.
In addition, to further align executive officers' interests with those of
the stockholders, the Company's executive compensation program utilizes stock
options and long-term incentive plan awards tied to increases in stockholder
value. In fiscal 1994, approximately 50% of total potential cash compensation
(consisting of salary, target bonus and target long-term incentive plan awards)
of the named executive officers was contingent on achieving corporate
performance goals.
COMPENSATION COMPONENTS
Working with outside consultants on a biennial basis and with the Company's
Human Resources Department, the Committee conducts comprehensive annual
evaluations of the Company's executive compensation program. The components of
the Company's executive compensation program are as follows: base salary, annual
incentive cash bonuses, long-term incentive plan awards and awards of stock
options and restricted stock.
BASE SALARY. The Committee establishes annually the base salaries to be
paid to the Company's executive officers for the coming fiscal year. In setting
each salary, the Committee takes into account several factors, including
competitive compensation data and qualitative factors such as an individual's
experience, responsibilities, management and leadership abilities and job
performance in the prior year. In evaluating competitive data, the Committee
generally strives to set salaries competitive with other consumer goods
companies, including many of the companies contained in the peer group used for
the performance graph in this Proxy Statement.
ANNUAL INCENTIVE PROGRAM. Each year, the Committee establishes minimum
performance thresholds under the Executive Incentive Plan for key executives,
including most of the named executive officers in order for any bonuses to be
paid. Based on the participant's salary range, this program provides for target
bonuses for executive officers of approximately 40% to 63% of base salary based
on the attainment of annual corporate performance goals (principally relating to
targeted pre-tax earnings of the Company and/or business unit) and individual
goals. The individual's personal contribution to the achievement of corporate
financial goals is assessed in determining the individual's bonus range. The
Company failed to achieve its internal pre-tax earnings target for the fiscal
year ending February 28, 1994. As a result, no bonuses were paid to the named
executive officers other than Mr. Morgan as a result of the Helene Curtis
International business unit achieving its pre-tax earnings target.
STOCKHOLDER VALUE CREATION PLAN. Each of the named executive officers also
participates in the Company's Stockholder Value Creation Plan ("SVC Plan"),
12
<PAGE>
a long-term incentive plan. Each year, the Committee determines which key
executives will be eligible for participation and establishes a minimum pre-tax
return on equity threshold that must be met in order for any awards to be made
during the succeeding three-year period. Awards are payable under the SVC Plan
pursuant to a formula based on the extent to which the Company's return on
equity increases above the threshold return on equity. This plan provides for
target awards at 50% of the participant's base salary. For the three-year period
ending February 28, 1994, the Company only marginally exceeded its threshold
target under the SVC Plan, but no payouts were made under the plan for this
period.
STOCK OPTIONS AND RESTRICTED STOCK. The Committee believes stock options
are a key long-term incentive vehicle because they provide executives with the
opportunity to acquire an equity interest in the Company and to share in the
appreciation of the value of its Common Stock. Stock options, therefore,
directly align the executive's interest with those of the stockholders.
Restricted stock awards further the goal of retaining key executives and
encourage stock ownership.
Stock options are granted to the named executive officers and other key
managers by the Committee generally every 12 to 18 months. No options were
granted during the fiscal year ended February 28, 1994 to the named executive
officers or other key management employees. Restricted stock awards were made
during the fiscal year ended February 28, 1994 to two executive officers.
In making stock option grants, the Committee reviews alternative exercise
pricing formulas and other methods for correlating the exercise price of options
to Company performance. Generally, stock options are not fully exercisable until
four years following the date of grant to reinforce a long-term perspective and
to help retain valued executives. Further, options are granted at the fair
market value of the Company's Common Stock on the date of grant. Therefore, the
Company's Common Stock must increase in value in order for the executive to
realize any benefit from the option. In determining the number of stock options
to be awarded to each individual, the Committee has utilized a formula based on
a percentage of the executive's base salary, taking into account the executive's
level of management responsibility and potential impact on the Company's
profitability and growth. Restricted stock awards have been made in special
limited circumstances, primarily as a retention and performance incentive.
As part of the Omnibus Budget Reconciliation Act (the "Act") passed by
Congress in 1993, a new limit was implemented on the deductibility of
compensation to the chief executive officer and the next four most highly
compensated executive officers. The limit generally disallows a deduction to the
Company for any compensation to these officers in excess of $1,000,000 per year.
The $1,000,000 limit on deductible compensation does not, however, apply to
certain performance-based pay that meets the requirements of the Act. The
Company has taken the necessary actions to preserve the deductibility of
payments made under the new Executive Management Incentive Plan and the 1994
Stock Appreciation Right Plan described in this Proxy Statement, including
soliciting the required stockholder approval of the material terms of such plans
in this Proxy Statement. The Company believes that the stock option plan under
which its officers receive grants of options and restricted stock complies with
Rule 16b-3 and therefore
13
<PAGE>
qualifies as a "performance-based" plan until the earlier of its amendment or
1997 under the transitional provisions of the proposed regulations. When final
regulations are issued, further changes will be made to the executive
compensation program to the extent necessary and feasible in order to maintain
the deductibility of payments under performance-based plans.
CHIEF EXECUTIVE OFFICER COMPENSATION
In determining the base salary for Ronald J. Gidwitz for the prior fiscal
year commencing March 1, 1993, the Committee considered the base salaries of
chief executive officers of peer group companies within the consumer goods
industry, the Company's performance in fiscal 1993 and Mr. Gidwitz's leadership
and job performance. In evaluating the Company's performance, the Committee
considered the Company's total return to stockholders, earnings, return on
equity and financial condition. No precise weight was assigned to any of these
factors, although the Committee believed that the Company's performance in each
area has compared favorably with its peers in the fiscal year ended February 28,
1993. In particular, the Company achieved its targeted pre-tax earnings
objective and a record net income of $22,109,000 for the fiscal year ending
February 28, 1993. Based on the Company's fiscal 1993 performance, as well as
comparative data which indicated that Mr. Gidwitz's salary was less than the
median salary for chief executive officers in other Fortune 500 consumer goods
companies, Mr. Gidwitz's base salary was set at an annual rate of $715,000
commencing March 1, 1993, an increase of $140,000 over the base salary
established on March 1, 1992. However, as a result of the Company's performance
in fiscal 1994 in which it generally failed to meet its internal financial
objectives, Mr. Gidwitz earned no awards in accordance with the formulas set
forth in the Executive Incentive Plan and SVC Plan, as compared to $366,300 and
$526,500, respectively, in awards under those plans in fiscal 1993 when the
Company achieved its internal financial goals. Accordingly, Mr. Gidwitz's total
compensation of $715,000 for fiscal 1994 was substantially affected by the
Company's fiscal 1994 performance. As of May 4, 1994, Mr. Gidwitz held options
to purchase a total of 98,539 shares of Common Stock and owned beneficially
25,056 shares of Common Stock and 524,543 shares of Class B Common Stock.
CONCLUSION
The Committee believes that the Company's policies and programs will be
effective over a period of years in achieving its goals of competitive executive
compensation and maximizing the return to shareholders.
Marshall L. Burman
Frank W. Considine
John C. Stetson
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Burman is of counsel to Wildman, Harrold, Allen & Dixon. During the last
fiscal year the firm rendered legal services to the Company.
14
<PAGE>
COMMON STOCK PERFORMANCE
The following graphs compare over the five-year and seven-year periods
ending February 28, 1994, the annual percentage change in the cumulative total
returns on the Company's Common Stock, the S&P 500 Index, and a peer group of 10
major U.S. consumer goods companies selected by the Company. The peer group
consists of Alberto-Culver Company, Avon Products, Inc., Bristol-Myers Squibb
Company, Carter-Wallace, Inc., Colgate-Palmolive Company, The Dial Corp., The
Dow Chemical Company, The Gillette Company, Johnson & Johnson and The Procter &
Gamble Company. For the purpose of calculating the peer group average, the
returns of each company have been weighted according to its stock market
capitalization as of the beginning of each fiscal year.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
HELENE CURTIS IND PEER GROUP BROAD MARKET
<S> <C> <C> <C>
1989 100 100 100
1990 92.57 125.59 118.91
1991 117.91 167.21 136.33
1992 171.35 202.64 158.15
1993 192.32 188.71 175.02
1994 114.79 201.19 189.62
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
HELENE CURTIS IND PEER GROUP BROAD MARKET
<S> <C> <C> <C>
1987 100 100 100
1988 86.61 100.37 97.33
1989 138.69 106.7 108.9
1990 128.39 133.96 129.49
1991 163.54 178.41 148.46
1992 237.65 216.35 172.23
1993 266.74 202.4 190.6
1994 159.2 215.56 206.5
</TABLE>
TRANSACTIONS WITH AFFILIATED PERSONS
During the last fiscal year, the Company leased office space in its
headquarters building at 325 N. Wells St., Chicago, Illinois, and provided
miscellaneous office supplies to Burnham Realty Company, Continental Materials
Corporation and other entities in which Gerald S. Gidwitz, Joseph L. Gidwitz
and/or members of their families have an interest. The rental amount and other
terms and conditions of the leases were established as fair rental value by an
independent appraiser and were approved by the Company's outside directors.
Amounts received by the Company pursuant to such leases and for miscellaneous
supplies during the last fiscal year were as follows: Burnham Realty Company
$23,484.09; Continental Materials Corporation $248,484.09; and all others
$20,972.14.
During the last fiscal year, McCord Group, Inc. provided certain travel
agency services to the Company. In the opinion of management, these services
were provided at rates equal to or less than those of competitive services.
Members of the families of Gerald S. Gidwitz and Joseph L. Gidwitz own
substantially all the capital stock of McCord Group, Inc.
15
<PAGE>
PROPOSALS
1. PROPOSAL TO ELECT DIRECTORS.
The Board of Directors is currently composed of ten members. The Certificate
of Incorporation of the Company divides the Board of Directors into three
classes, as nearly equal in size as possible, with one class of directors
elected each year for a three-year term.
The Board of Directors has nominated three persons for election at the
Annual Meeting to serve for a three-year term expiring at the annual meeting of
stockholders to be held in 1997 and until their successors are elected and have
qualified. All three nominees, Marshall L. Burman, Frank W. Considine and Ronald
J. Gidwitz, are currently serving as directors.
It is the intention of those persons named in this Proxy to vote in favor of
all three nominees, all of whom have agreed to serve. If any nominee should,
before the meeting, become unavailable for election, the holders of the Proxy
may exercise their discretion to vote for the election of any substitutes as the
Board of Directors may recommend.
2. PROPOSAL TO APPROVE THE MATERIAL TERMS OF THE
EXECUTIVE MANAGEMENT INCENTIVE PLAN.
The Compensation and Stock Option Committee of the Board of Directors has
adopted, subject to stockholder approval at the Annual Meeting, the Executive
Management Incentive Plan (the "Incentive Plan"). The Incentive Plan was adopted
to conform to recent changes in federal tax law in order to preserve the
Company's tax deduction for compensation paid to certain executive officers.
Specifically, Section 162(m) of the Internal Revenue Code of 1986, as amended,
requires stockholder approval of the material terms of performance-based
compensation for the chief executive officer and the four next most highly
compensated executive officers in order for the Company to deduct any
performance-based compensation to such officer in excess of $1 million. If the
stockholders fail to approve the Incentive Plan, the Committee may consider
adopting an alternative bonus program without stockholder approval, even though
some or all of the payments made thereunder may not be deductible by the Company
in order to maintain the competitiveness of the Company's executive compensation
program. The full text of the Incentive Plan appears as Exhibit A to this Proxy
Statement and is incorporated herein by reference. The Incentive Plan is
summarized below, but such summary is qualified in its entirety by reference to
the full text of the Incentive Plan.
An annual bonus program has been an integral part of the Company's overall
compensation program for many years. The annual bonus program is intended to
provide cash awards based on the attainment of a combination of financial
objectives and personal goals. The Incentive Plan described herein is
substantially similar to the Executive Incentive Plan, the existing bonus plan
for all executive officers and key employees, except that it conforms with the
requirements of Section 162(m). Any key executive officers of the Company and
its subsidiaries
16
<PAGE>
selected by the Committee are eligible to participate in the Incentive Plan.
There are currently 16 executive officers of the Company. Participants who are
selected to participate in the Incentive Plan will be ineligible to participate
in the Company's Executive Incentive Plan. As of March 1, 1994, the President
and Chief Executive Officer, Ronald J. Gidwitz, was the only participant in the
Incentive Plan.
The Incentive Plan will be administered by the Compensation and Stock Option
Committee (the "Committee"), which consists of three members of the Board of
Directors who are not current or former employees or officers of the Company.
Based on the participant's salary range, this program provides for target
bonuses expressed as a percentage of base salary based on the attainment of
annual corporate and individual performance goals. The Committee will establish
the salary, performance goals and target bonus for each participant in writing
at the beginning of each fiscal year. The performance goals will be the
Company's, and if applicable, the business unit's, target pre-tax income for the
applicable fiscal year and various objective individual goals. The individual
goals are personal business objectives which must be attained by the participant
within the fiscal year, and may include goals such as hiring of key personnel,
developing a corporate strategy for a particular business unit or market or
completing a corporate acquisition. The selected individual performance
objectives are assigned various weights by the Committee, which may vary among
participants and may be changed from year to year by the Committee. The Company
believes that the specific performance goals constitute confidential business
information the disclosure of which would have an adverse effect on the Company.
The Committee must certify in writing that the goals have been met before any
payments to participants may be made. The Committee will have no discretion to
increase the bonus but will retain the ability to eliminate or decrease a bonus
otherwise payable to a participant.
The Incentive Plan provides for payouts in excess of the target bonus for a
participant if the Company exceeds its corporate goals. The maximum amount
payable in any fiscal year under the Incentive Plan to any participant under the
Plan is $1.3 million. The Committee has approved, subject to stockholder
approval of the Incentive Plan, the target bonus for Ronald J. Gidwitz for
fiscal 1995 as detailed in the table under "New Plan Benefits".
The Company reserves the right to amend the Incentive Plan, provided however
that stockholder approval is required for any amendments that would modify: (a)
the participants eligible to participate in the Incentive Plan; (b) the business
criteria underlying the objective performance goals; and (c) the maximum bonus
payable to any participant under the Incentive Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL.
17
<PAGE>
3. PROPOSAL TO APPROVE THE MATERIAL TERMS OF THE HELENE CURTIS INDUSTRIES, INC.
1994 STOCK APPRECIATION RIGHT PLAN.
The Compensation and Stock Option Committee of the Board of Directors has
adopted, subject to stockholder approval at the Annual Meeting, the Helene
Curtis Industries, Inc. 1994 Stock Appreciation Right Plan (the "SAR Plan"). If
approved, the SAR Plan will be effective as of March 1, 1994. If the
stockholders fail to approve the Plan, the Committee may consider adopting an
alternative compensation program without stockholder approval, even though some
or all of the payments made thereunder may not be deductible by the Company in
order to maintain the competitiveness of the Company's executive compensation
program. The Board of Directors believes that the participation of key employees
(including officers) of the Company and its subsidiaries in a stock appreciation
right plan is an important part of the Company's compensation program.
Participants in the SAR Plan receive a benefit only if the Company's Common
Stock appreciates in value above its fair market value on the date of grant. The
full text of the SAR Plan appears as Exhibit B to this Proxy Statement and is
incorporated herein by reference. The SAR Plan is summarized below, but such
summary is qualified in its entirety by reference to the full text of the SAR
Plan.
The SAR Plan authorizes the issuance of up to 2,000,000 units to employees
of the Company, subject to appropriate adjustments for stock dividends, stock
splits, recapitalizations or similar changes in outstanding shares of the
Company's Common Stock. A unit is a right which entitles the participant to
receive at the time of exercise an amount equal to the difference between the
fair market value of a single share of Common Stock on the date of exercise and
the base price of the unit. The base price of any unit may not be less than the
fair market value of a single share of Common Stock on the date the unit is
granted. No more than 100,000 units may be granted to any individual in any
12-month period. If any unit granted to a participant terminates or expires
prior to being exercised, such unexercised units will be available for issuance
again under the SAR Plan. The units will be awarded for no additional cash
consideration from the participants selected.
The SAR Plan will be administered by the Compensation and Stock Option
Committee (the "Committee"), which consists of three members of the Board of
Directors who are not current or former employees or officers of the Company and
thus will not at any time during the administration of the SAR Plan receive an
award pursuant to the SAR Plan or any discretionary stock option plan of the
Company. Subject to the provisions of the SAR Plan, the Committee will have full
power to select from among the officers and other employees of the Company or
any subsidiary persons eligible for awards, the individuals to whom awards will
be granted, the number of units, the duration of each unit, and the base price
of each unit.
Under certain circumstances, all units will terminate immediately upon the
cessation of the employee's employment. In the event of a participant's death,
retirement or long-term disability while employed by the Company or a subsidiary
(or during the three-month period during which the unit continues to be
exercisable
19
<PAGE>
after cessation of employment), the participant or the participant's
representative may exercise the unit (to the extent exercisable as of the date
of death or retirement) within three years after the date of death, retirement
or long-term disability, but no later than the expiration date of the unit. The
Committee has the discretion to provide for the exercise of all or a portion of
unvested units upon death, disability or retirement. The exercise of units under
the SAR Plan may be subject to such other terms and conditions not inconsistent
with the SAR Plan as the Committee may specify in granting such units. In the
event of the merger, consolidation, dissolution or sale of substantially all of
its assets, the Company may cancel any unit by giving 30 days' notice and
permitting the exercise of any units without regard to vesting provisions.
The Board of Directors, acting by a majority of its members, exclusive of
Board Members who are eligible to receive awards under the SAR Plan, without
further action on the part of the stockholders, may from time to time alter,
amend or suspend the SAR Plan or any unit granted under the SAR Plan or may at
any time terminate the SAR Plan; PROVIDED, HOWEVER, that the Board may not (i)
(except as provided in Section 7 of the SAR Plan) change the total number of
units available under the Plan, (ii) increase the maximum term of units or
maximum number of units that may be granted to an individual in any 12-month
period, (iii) decrease the minimum unit price or otherwise materially increase
the benefits accruing to participants under the Plan or (iv) materially modify
the eligibility requirements of the Plan, and provided further that no action
shall materially and adversely affect any outstanding units without the consent
of the respective unit holders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL.
Annual cash bonus awards and SAR awards to be issued in the future under the
Incentive Plan and SAR Plan, respectively, cannot be determined at this time.
The following table sets forth: (1) the target and maximum annual cash bonus
awards that participants are entitled to receive for fiscal 1995 if performance
goals are met and (2) SAR awards granted at fair market value on March 1, 1994.
NEW PLAN BENEFITS
<TABLE>
<CAPTION>
EXECUTIVE MANAGEMENT INCENTIVE PLAN
---------------------------------------
FY 1995 DOLLAR VALUE ($) SAR PLAN
--------------------------------------- ----------------
NAME AND POSITION MINIMUM TARGET MAXIMUM NUMBER OF UNITS
- -------------------------------------- ------------- ----------- ----------- ----------------
<S> <C> <C> <C> <C>
Ronald J. Gidwitz..................... $ 0 $ 472,973 $ 543,919 57,486
Charles G. Cooper..................... 0 0 0 13,600
Michael Goldman....................... 0 0 0 25,500
Colin J. Morgan....................... 0 0 0 10,000
Gilbert P. Smith...................... 0 0 0 14,400
Executive Group....................... 0 472,973 543,919 149,834
Non-Executive Director Group.......... 0 0 0 0
Non-Executive Officer Employee
Group................................ 0 0 0 5,422
</TABLE>
20
<PAGE>
4. PROPOSAL TO RATIFY APPOINTMENT OF INDEPENDENT ACCOUNTANTS.
The Board of Directors and the Audit Committee recommend the ratification of
the appointment of Coopers & Lybrand, Certified Public Accountants, to audit the
Company's financial statements for the fiscal year ending February 28, 1995. An
appropriate resolution ratifying such appointment will be submitted to the
stockholders at the Annual Meeting. If such resolution is not adopted,
management will reconsider such appointment.
A representative of Coopers & Lybrand will be present at the Annual Meeting,
will have the opportunity to make a statement if he or she wishes and will be
available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL.
OTHER MATTERS
The Board of Directors knows of no other matters which may be brought before
the meeting. In the event that other matters are properly presented for action,
it is the intention of the named Proxies to vote on them at their discretion.
STOCKHOLDER PROPOSALS FOR 1995
In order to be considered for inclusion in the Proxy Statement for the
Annual Meeting of Stockholders of the Company to be held in 1995, stockholder
proposals must be received not later than January 28, 1995. Such proposals
should be sent to: Secretary, Helene Curtis Industries, Inc., 325 N. Wells
Street, Chicago, Illinois 60610.
According to the By-Laws of the Company, any other proposal or action to be
presented by any stockholder at the 1995 Annual Meeting tentatively scheduled to
be held on June 27, 1995, shall be out-of-order unless specifically described in
the Company's notice to all stockholders of the meeting or provided such
proposal shall have been submitted in writing to the Secretary of the Company
not less than 60 days nor more than 90 days prior to the date of the aforesaid
1995 Annual Meeting.
In addition, the By-Laws of the Company require that stockholders intending
to nominate directors for election at the 1994 Annual Meeting must similarly
deliver written notice thereof to the Secretary of the Company in the same time
period as provided for other stockholder proposals above.
The Secretary of the Company shall furnish to any stockholder so requesting,
a copy of the By-Laws of the Company specifying the items that are required to
be included in any written stockholder proposal or stockholder nomination of a
director.
COMPLIANCE WITH SECTION 16(A)
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors and persons who own more than ten percent of a registered
21
<PAGE>
class of the Company's equity securities to file reports of ownership and
changes in ownership of such securities with the Securities and Exchange
Commission and the New York Stock Exchange. Based solely upon a review of the
forms furnished to the Company or written representations that no Forms 5 were
required, the Company believes that during fiscal 1994 all filing requirements
applicable to its officers, directors and greater than 10% stockholders were
complied with except that the following named persons each inadvertently failed
to include one grant of stock options on that person's respective Form 5:
Charles G. Cooper, Richard W. Frank, Ronald J. Gidwitz, Thomas J. Gildea,
Michael Goldman, V. James Marino, Colin J. Morgan, Robert K. Niles, Mary J.
Oyer, Robert Sack, Arthur A. Schneider, Gilbert P. Smith, Roy A. Wentz, Eugene
Zeffren. Each of such officers or directors timely amended or filed a Form 5 to
reflect the omitted transaction. No options were exercisable prior to the filing
of the amended Form 5 and options granted to the named executive officers were
disclosed in the Proxy Statement for the 1993 Annual Meeting of Shareholders.
AVAILABILITY OF FORM 10-K
Upon receipt of the written request of any stockholder, the Company will
supply to such stockholder, without charge, a copy of the Company's most recent
Annual Report on Form 10-K. The request should be addressed to: Secretary,
Helene Curtis Industries, Inc., 325 N. Wells Street, Chicago, Illinois 60610.
By Order of the Board of Directors
HELENE CURTIS INDUSTRIES, INC.
Roy A. Wentz, Secretary
22
<PAGE>
EXHIBIT A
HELENE CURTIS INDUSTRIES, INC.
EXECUTIVE MANAGEMENT INCENTIVE PLAN
1. PURPOSE
The purpose of the Executive Management Incentive Plan (the "Plan"), as
hereinafter set forth, is to motivate and reward certain executive officers by
providing an incentive to achieve short-term performance goals related to the
performance of the Company. The Plan is also intended to conform to the
requirements of Section 162(m) of the Internal Revenue Code of 1986, as amended,
and the regulations promulgated thereunder.
2. DEFINITIONS
"Base Salary" means the gross base salary as of the beginning of the Plan
Year before any reduction for any contribution to a retirement or deferred
income plan of the Company.
"Business Unit Bonus" means the portion of a Participant's Target Bonus
determined by the Committee to be contingent on the Participant's business unit
achieving its Business Unit Goal.
"Business Unit Goal" means with respect to any Plan Year the target pre-tax
earnings of the Participant's business unit of the Company (either before or
after corporate charges), exclusive of performance compensation under this Plan
and any extraordinary items, as established in the Company's budget and approved
by the Committee prior to the beginning of such Plan Year.
"Committee" means the Compensation and Stock Option Committee of the Board
of Directors.
"Company" means Helene Curtis Industries, Inc.
"Corporate Bonus" means the portion of a Participant's Target Bonus
determined by the Committee to be contingent on the Company achieving its
Corporate Goal.
"Corporate Goal" means with respect to any Plan Year the target pre-tax
earnings for the Company, exclusive of extraordinary items, as established in
the Company's budget and approved by the Committee prior to the beginning of
such Plan Year.
"Individual Bonus" means the portion of a Participant's bonus determined by
the Committee to be contingent on the Participant achieving his/her Individual
Goals.
"Individual Goals" means with respect to any Plan Year the objective,
personal business goals established by the Committee for each Participant prior
to the beginning of the Plan Year.
A-1
<PAGE>
"Maximum Performance" means the maximum percentage above the Target
Performance level of the Corporate and, for business unit employees, the
Business Unit Goal, that the Company will recognize in calculating amounts
payable under the Plan.
"Participant" means for any Plan Year an executive officer of the Company
selected by the Committee to participate in the Plan.
"Payout Multiple" means the multiple(s) chosen by the Committee prior to the
beginning of the Plan Year used to calculate the amounts payable to a
Participant if the Company exceeds its Target Performance level.
"Plan Year" means the fiscal year of the Company.
"Target Bonus" means with respect to any Participant, the amount of cash
compensation, expressed as a percentage of the Participant's Base Salary, that
will be earned by the Participant if 100% of the Individual, Corporate and, if
applicable, Business Unit Goals are achieved.
"Target Performance" means achieving 100% of the Corporate Goal and, for
business unit employees, the Business Unit Goal.
"Threshold Performance" means the minimum percentage of the Corporate Goal
(for corporate employees) or Business Unit Goal (for business unit employees)
which must be achieved in order for a Participant to receive any portion of the
Participant's Corporate or Business Unit Bonus.
3. ADMINISTRATION
A. Committee. The Plan is administered by the Committee, which is
comprised solely of outside, disinterested members of the Board of Directors who
are not current or former officers or employees of the Company. Subject to the
express terms of the Plan, the Committee has all authority necessary to
administer the Plan, including selecting Participants from among the executive
officers, determining the size of such Participant's Target Bonus and
determining the Individual, Corporate and Business Unit Goals and Payout
Multiple for the Plan Year.
B. Participants. Prior to the beginning of each Plan Year, the Committee
will select Participants from among the Company's executive officers.
Participants selected by the Committee to participate in the Plan are ineligible
to participate in any other Company annual bonus plan. Nothing contained herein
shall be construed as creating a contract of employment with a Participant nor
obligate the Company to allow the employee to be a Participant in the Plan in
future Plan Years.
4. PERFORMANCE GOALS
A. Goals. Prior to the beginning of each Plan Year, the Committee will
establish in writing the Individual, Corporate and, if applicable, Business Unit
Goals for each Participant. For employees employed by the corporate function of
the Company, their Target Bonus is based upon achieving a combination of
Individual and Corporate Goals. For employees employed by one of the business
A-2
<PAGE>
units of the Company, their Target Bonus is based upon achieving a combination
of Individual, Corporate and Business Unit Goals. Individual Goals must be
objective business goals which may be achieved personally by the Participant
within the Plan Year. The Committee will assign percentages to the Individual
Goals according to their relative importance. Such goals will be based on
business criteria related to the Participant's area of responsibility such as:
operating a department or division within budget, hiring key personnel,
completing a transaction such as an acquisition or joint venture or introducing
a new product.
B. Corporate and Business Unit Performance Levels. Prior to the beginning
of each Plan Year, the Committee will establish in writing the Company and
Business Unit Threshold, Target and Maximum Performance levels.
5. BONUS DETERMINATION
A. Target and Maximum Bonus. Prior to the beginning of the Plan Year, the
Committee will establish a Target Bonus for each Participant. The Participant's
personal contribution to the achievement of Corporate and Business Unit Goals is
assessed in determining the Participant's Target Bonus. The maximum bonus
payable in any Plan Year to any Participant may not exceed $1.3 million.
B. Bonus Calculation. No amount is payable to any Participant under this
Plan unless the Company achieves 70% of its Corporate Goal (for corporate
employees) or 70% of the applicable Business Unit Goal (for business unit
employees). If the Company achieves 70% of its Corporate or Business Unit Goals,
as applicable, the Participant is entitled to the following payments under the
Plan:
1. INDIVIDUAL BONUS. A Participant is entitled to receive the portion
(up to a maximum of 100%) of the Participant's Individual Bonus that the
Committee certifies in writing as of the end of the Plan Year was
accomplished by the Participant.
2. CORPORATE BONUS (for all Participants).
(a) LESS THAN TARGET PERFORMANCE: If the Company achieves its Corporate
Goal at LESS than the Target Performance level but GREATER than the
Threshold Performance level, a Participant is entitled to receive a
percentage of his/her Corporate Bonus in proportion to the
percentage of the Corporate Goal achieved by the Company. For
example, assuming the Threshold Performance level is 85% and the
Company achieves 90% of its Corporate Goal, a Participant will
receive 90% of his/her Corporate Bonus.
(b) TARGET PERFORMANCE: If the Company achieves its Corporate Goal at
the Target Performance level (I.E., 100%), a Participant is entitled
to receive 100% of his/her Corporate Bonus.
(c) GREATER THAN TARGET PERFORMANCE: If the Company exceeds its
Corporate Goal, a Participant is entitled to receive 100% of the
Participant's Corporate Bonus, PLUS the Payout Multiple times the
percentage amount that the Company exceeds its Corporate Goal
A-3
<PAGE>
up to the Maximum Performance level. For example, if the Maximum
Performance level is 120%, the Payout Multiple is 2 and the Company
achieves 110% of its Corporate Goal, a Participant receives 120% of
his/her Corporate Bonus.
3. BUSINESS UNIT BONUS (for business unit employees).
(a) LESS THAN TARGET PERFORMANCE: If the applicable business unit
achieves its Business Unit Goal at LESS than the Target Performance
level but GREATER than the Threshold Performance level, a
Participant is entitled to receive a percentage of his/her Business
Unit Bonus in proportion to the percentage of the Business Unit Goal
achieved by the business unit. For example, assuming the Threshold
Performance level is 85% and the applicable business unit achieves
90% of its Business Unit Goal, a Participant will receive 90% of
his/her Business Unit Bonus.
(b) TARGET PERFORMANCE: If the applicable Business Unit achieves its
Business Unit Goal at the Target Performance level (I.E., 100%), a
Participant is entitled to receive 100% of his/her Business Unit
Bonus.
(c) GREATER THAN TARGET PERFORMANCE: If the applicable business unit
exceeds its Business Unit Goal, a Participant is entitled to receive
100% of the Participant's Business Unit Bonus, PLUS the Payout
Multiple times the percentage amount that the business unit exceeds
its Business Unit Goal up to the Maximum Performance level. For
example, if the Maximum Performance level is 105%, the Payout
Multiple is 3 and the business unit achieves 110% of its Business
Unit Goal, a Participant receives 115% of his/her Business Unit
Bonus.
C. Payment of Bonus. Participants must be employed by the Company as of
the end of the Plan Year in order to receive any amount payable under this Plan
for the Plan Year. All payments under this Plan will be made in cash and are
subject to withholding for all applicable taxes. Payments under this Plan will
be made after the Committee certifies in writing as to the completion of the
Individual, Corporate and Business Unit Goals, and any payments will be made no
later than May 1 of the following Plan Year.
6. PLAN AMENDMENT
The Committee will have no discretion to increase the bonus but will retain
the ability to eliminate or decrease a bonus otherwise payable under this Plan
to a Participant. The Committee reserves the right to amend the Plan, PROVIDED,
HOWEVER, that stockholder approval is required for any amendments that would
modify: (a) the Participants eligible to participate in the Plan; (b) the
business criteria on which the performance goals are based; and (c) the maximum
bonus payable to any Participant under the Plan.
A-4
<PAGE>
EXHIBIT B
HELENE CURTIS INDUSTRIES, INC.
1994 STOCK APPRECIATION RIGHT PLAN
1. PURPOSE
The purpose of the Helene Curtis Industries, Inc. 1994 Stock Appreciation
Right Plan (the "Plan"), as hereinafter set forth, is to enable Helene Curtis
Industries, Inc., a Delaware corporation (the "Company"), to recognize the
contributions of officers and key employees of the Company and its subsidiaries
to the appreciation in value of the Company's stock. Additional purposes of the
Plan include providing a meaningful incentive to Participants to make
substantial contributions to the Company's future success and enhancing the
Company's ability to attract and retain persons who will make such
contributions. By meeting these objectives, the Plan is intended to benefit the
interests of the Company's stockholders.
2. DEFINITIONS
As used herein, the following words or terms have the meanings set forth
below:
"Award" means the grant of a Unit to a Participant.
"Base Price" has the meaning contained in Section 6.1.
"Board" means the Board of Directors of the Company.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor statute.
"Committee" means the Compensation and Stock Option Committee of the Board.
The Committee shall be comprised solely of two or more persons who are
"disinterested persons" within the meaning of Rule 16b-3(c)(2)(i), are not
current or former employees or officers of the Company, otherwise meet the
requirements of an outside director as that term is defined under the
regulations promulgated pursuant to Section 162(m) of the Code, and will not at
any time during the administration of the Plan receive an Award pursuant to the
Plan or any discretionary stock option plan of the Company.
"Common Stock" or "Stock" means the Common Stock of the Company.
"Company" means Helene Curtis Industries, Inc., a corporation established
under the laws of Delaware.
B-1
<PAGE>
"Designated Beneficiary" means the beneficiary designated by a Participant,
in a manner determined by the Committee, to receive amounts due or exercise
rights of the Participant in the event of the Participant's death. In the
absence of an effective designation, Designated Beneficiary shall mean the
Participant's estate.
"Disability" means a physical or mental disability of such a nature that it
would qualify a Participant for benefits under the long term disability
insurance plan of Helene Curtis, Inc. or any successor plan.
"Fair Market Value," as used to refer to the price of a share of Common
Stock on a particular day, means the closing price for the Common Stock for that
day as reported in The Wall Street Journal, or if no prices are quoted for that
day, the last preceding day on which such prices of Common Stock are so quoted.
"Participant" means an individual selected by the Committee to receive an
Award under the Plan.
"Retirement" means the termination of employment by a Participant after
attaining age 62 under circumstances which the Committee, in its sole
discretion, deems equivalent to retirement.
"Unit" means a right granted pursuant to this Plan to a Participant which
entitles the Participant to receive at the time of exercise an amount, payable
solely in cash, equal to the difference between the Fair Market Value of a
single share of Common Stock and the Base Price of a single share of Common
Stock.
"Unit Agreement" means an agreement executed by the Company and a
Participant containing the terms and conditions for an Award of Units.
"Substantial Cause" means (a) the commission of a criminal act against, or
in derogation of the interests of the Company or its subsidiaries; (b) knowingly
divulging confidential information about the Company or its subsidiaries to a
competitor or to the public; (c) interference with the relationship between the
Company or its subsidiaries and any major supplier or customer; or (d) the
performance of any similar action that the Committee, in its sole discretion,
may deem to be sufficiently injurious to the interest of the Company or its
subsidiaries to constitute substantial cause for termination.
3. ADMINISTRATION
The Plan shall be administered by the Committee in accordance with Rule
16b-3(c)(2)(i). Subject to the express provisions of the Plan, the Committee
shall have full authority to determine the number and type of Awards granted to
each Participant and shall interpret the Plan, prescribe, amend and rescind
rules and regulations relating to it, determine the terms and provisions of the
respective Participants' agreements (which need not be identical) and make such
other determinations as it deems necessary or advisable for the administration
of
B-2
<PAGE>
the Plan. The decisions of the Committee on matters within its jurisdiction
under the Plan shall be conclusive and binding. No member of the Board or the
Committee shall be liable for any action taken or determination made in good
faith.
4. UNITS AVAILABLE
The maximum number of Units that will be available for issuance under the
Plan is 2,000,000 Units, which shall be subject to adjustment in accordance with
the provisions of Section 7 hereof. No Participant may be granted an Award in
excess of 100,000 Units in any 12-month period. In the event that any Unit
granted under the Plan expires unexercised or is terminated or ceases to be
exercisable for any other reason without having been fully exercised prior to
the end of the period during which Units may be granted under the Plan, such
unexercised Units shall again become available for new Awards to be granted
under the Plan to any eligible employee (including the holder of such former
Units).
5. AWARDS
Awards may be made under the Plan to any of the officers or employees of the
Company or its subsidiaries who, in the opinion of the Committee, are in a
position to make a significant contribution to the Company's future success. The
Committee shall determine, within the limits of the express provisions of the
Plan, those key managerial employees to whom, and the time or times at which,
Units are to be granted. The Committee shall also determine the number of Units,
the duration of each Unit, the Base Price under each Unit, the time or times
within which (during the term of the Unit) all or portions of each Unit may be
exercised. In making such determinations, the Committee may take into account
the nature of the services rendered by the employee, his or her present and
potential contributions to the Company's success and such other factors as the
Committee in its discretion shall deem relevant.
6. REQUIRED TERMS AND CONDITIONS OF UNITS
The Units granted under the Plan shall be in such form and upon such terms
and conditions as the Committee shall from time to time determine, subject to
the provisions of the Plan, including the following:
6.1 Base Price. The Base Price of each Unit shall be established by the
Committee and may not be a price less than the Fair Market Value of
Common Stock on the date an Award is made.
6.2 Maximum Term of Unit. A Unit shall be exercisable during such period of
time as the Committee may specify, provided that no Unit shall be
exercisable after the expiration of five years from the date it is
granted.
6.3 Installment Exercise Limitations. Each Award shall generally become
exercisable in such number of cumulative annual installments as the
B-3
<PAGE>
Committee shall establish, if any, with an equal number becoming
exercisable at the end of each year after the date such Award is made,
except to the extent that other terms of exercise are specifically
provided by other provisions of the Plan.
6.4 Termination of Employment
(a) DEATH. If a Participant dies during employment with the Company (or
within three months after cessation of such employment, unless
cessation occurs due to Substantial Cause) and at a time when the
Participant is entitled to exercise a Unit, all Units which were
exercisable at the time of the Participant's death may be exercised
at any time within three years after the Participant's death. Units
not exercisable at the time of death will terminate. Units
exercisable after death may be exercised by the Designated
Beneficiary and shall be subject to all provisions of the Plan, and
must be exercised by the end of the post-death exercise period
specified in this paragraph. Unless exercised within the applicable
period, each Unit shall expire at the end of such period. In no
event, however, may any Unit granted under the Plan be exercised
after the expiration of the term set forth in the Unit at the time
of grant.
(b) RETIREMENT. In the event a Participant ceases employment due to
Retirement at a time when the Participant is entitled to exercise a
Unit granted under the Plan (unless, as determined by the Committee,
such Participant becomes employed by a competitor of the Company)
all Units which were exercisable at the time of the Participant's
Retirement may be exercised at any time within three years after the
Participant terminates employment due to Retirement; PROVIDED,
HOWEVER, that if the Participant shall die during the extended
period for exercise provided by this section, the Units exercisable
at the time of Retirement may be exercised to the same extent as if
the deceased Participant had survived during a period equal to the
greater of one year from the date of death or the remainder of the
extended period. Units not exercisable at the time of Retirement
will terminate. Unless exercised within the applicable period, each
Unit shall expire at the end of such period. In no event, however,
may any Unit granted under the Plan be exercised after the
expiration of the term set forth in the Unit at the time of grant.
(c) DISABILITY. In the event that the Participant's employment ceases
due to Disability at a time when the Participant is entitled to
exercise a Unit, all Units which were exercisable at the time of the
Participant's Disability may be exercised at any time within three
years after the Participant ceases employment due to Disability;
PROVIDED, HOWEVER, that if Participant shall die during the extended
period for exercise provided by this section, the Units exercisable
at the time employment ceased due to Disability may be exercised by
the Designated Beneficiary to the same extent as if the deceased
Participant had
B-4
<PAGE>
survived during a period equal to the greater of one year from the
date of death or the remainder of the extended period. Units not
exercisable at the time of Disability will terminate. Unless
exercised within the applicable period, each Unit shall expire at
the end of such period. In no event shall any Unit be exercised
after the expiration of the term set forth in the Unit at the time
of grant.
(d) OTHER TERMINATION. In the event that Participant shall cease to be
employed by the Company and/or its subsidiaries for any reason other
than death, Disability or Retirement as set forth above unless, as
determined by the Committee, the Participant becomes employed by a
competitor of the Company, the Participant shall have the right,
subject to the provisions of Sections 6.2 and 7, to exercise his or
her Unit(s) at any time within three months after such cessation of
employment (not in excess of the stated term of the Unit) but only
to the extent each Unit was exercisable at the date of such
cessation of employment. Notwithstanding the provisions of the
preceding sentence, if employment is terminated at the request of
the Company for Substantial Cause, the Participant's right to
exercise any Units shall terminate at the time notice of termination
of employment is given by the Company to such Participant.
(e) ACCELERATION OF VESTING. Notwithstanding any provision to the
contrary in the foregoing Section 6, the Committee shall have the
discretion at the time Units are granted under the Plan, to provide
in the Unit Agreement for the exercise of all or a portion of Units,
which would otherwise not be exercisable, at the time of death,
Disability or Retirement of the Participant.
6.5 Notice of Exercise. Units may be exercised by giving written notice to
the Secretary of the Company, stating the number of Units which are
being exercised. Upon exercise, such holder of the Units will be paid
the difference between the Base Price of the Units and the Fair Market
Value of the Common Stock on the exercise date. The payment will be made
in the form of a check payable to the holder of the Units within 30 days
of the exercise date.
7. ADJUSTMENTS
7.1 The aggregate number of Units and the number of Units per Participant
that may be granted hereunder and the Base Price per share for each
Unit, may all be appropriately adjusted, as the Committee may in its
sole discretion determine, for any increase or decrease in the number of
shares of issued Common Stock of the Company resulting from a
subdivision or consolidation of shares whether through reorganization,
payment of a share dividend or other increase or decrease in the number
of such shares outstanding effected without receipt of consideration by
the Company; PROVIDED, HOWEVER, that no adjustment in the number of
Units
B-5
<PAGE>
which may be granted under the Plan or in the number of outstanding
Units shall be made in the event of a contribution, directly or
indirectly of Common Stock by the Company to any Company employee
benefit plan.
7.2 Subject to any required action by the stockholders, if the Company shall
be a party to a transaction involving a sale of substantially all its
assets, a merger or a consolidation, any Unit granted hereunder may be
canceled by the Company as of the effective date of any such
transaction, by giving 30 days' prior written notice to the holders
thereof of its intention to do so during which time he or she shall have
the right to exercise all Units whether or not by its terms such Unit is
then exercisable and without regard to any installment exercise
provisions therein or in this Plan.
7.3 In the case of dissolution of the Company, every Unit outstanding
hereunder shall terminate; PROVIDED, HOWEVER, that each Unit holder
shall have 30 days' prior written notice of such event, during which
time he or she shall have a right to exercise all Units whether or not,
by its terms, such Unit is then exercisable and without regard to any
installment exercise provisions therein or in this Plan.
7.4 On the basis of information known to the Company, the Board or the
Committee shall make all determinations under this Section 7, including
whether a transaction involves a sale of substantially all the Company's
assets, and all such determinations shall be conclusive and binding.
7.5 The termination of the Plan and any exercise of a Unit the
exercisability of which is accelerated by the operation of Section 7.2
above shall be subject to and conditioned upon the consummation of the
transaction, to which such acceleration relates and if, for any reason,
such transaction is abandoned, the exercise of such Unit shall be void
and such Unit shall thereafter be exercisable only as permitted by the
Plan, which shall remain in full force and effect.
8. UNIT AGREEMENTS
Each Participant shall agree to such terms and conditions in connection with
the exercise of a Unit and execute a Unit Agreement containing such terms and
conditions, as the Committee may deem appropriate. Unit Agreements need not be
identical.
9. NON-TRANSFERABILITY
During the lifetime of a Participant, any Unit granted to a Participant
shall be exercisable only by such Participant, the Participant's payee pursuant
to a qualified domestic relations order or in the case of a Disability, legal
guardian or representative. No Unit shall be assignable or transferable, except
by will or by the laws of descent and distribution or, pursuant to a domestic
relations order entered by a court of competent jurisdiction. The granting of a
Unit shall impose no obligation upon the employee to exercise such Unit. The
foregoing notwithstanding, nothing
B-6
<PAGE>
shall prevent the Participant (or any other person who acquires any of the
Participant's Units in the manner stated above) from transferring any of the
Units to a trust with the prior consent of the Committee.
10. NO CONTRACT OF EMPLOYMENT
Neither the adoption of this Plan nor the grant of any Unit shall be deemed
to obligate the Company or any subsidiary of the Company to continue the
employment of any Participant for any particular period, nor shall the granting
of a Unit constitute a request or consent to postpone the Retirement date of any
Participant.
11. INDEMNIFICATION OF COMMITTEE
In addition to such other rights of indemnification as they may have as
directors or as members of the Committee, the members of the Committee shall be
indemnified by the Company against the reasonable expenses, including attorneys'
fees actually and necessarily incurred in connection with the defense of any
action, suit or proceeding, (or in connection with any appeal therein), to which
they or any of them may be a party by reason of any action taken or failure to
act under or in connection with the Plan or any Award granted hereunder, and
against all amounts paid by them in settlement thereof (provided such settlement
is approved by independent legal counsel selected by the Company) or paid by
them in satisfaction of a judgment in any such action, suit or proceeding,
except in relation to matters as to which it shall be adjudged in such action,
suit or proceedings that such Committee member is liable for gross negligence or
misconduct in the performance of his duties, provided that within 60 days after
institution of any such action, suit or proceeding a Committee member shall in
writing offer the Company the opportunity, at its own expense, to handle and
defend the same.
12. TERMINATION AND AMENDMENT OF PLAN
The Board, acting by a majority of its members, exclusive of Board Members
who are eligible to receive Units, may from time to time alter, amend or suspend
the Plan or any Unit granted hereunder or may at any time terminate the Plan,
provided, however, that the Board may not (i) (except as provided in Section 7
hereof) change the total number of Units available under the Plan, (ii) increase
the maximum term of Units or maximum number of units that may be granted to an
individual in any 12-month period, (iii) decrease the minimum Unit price or
otherwise materially increase the benefits accruing to participants under the
Plan or (iv) materially modify the eligibility requirements of the Plan, and
provided further that no such action shall materially and adversely affect any
outstanding Units without the consent of the respective Unit holders.
13. TAX WITHHOLDING
The Company shall have the power to either require the recipient to remit to
the Company an amount sufficient to satisfy Federal, state and local withholding
tax requirements, or to deduct from a payment pursuant to the Plan an amount
sufficient to satisfy any withholding tax requirements.
B-7
<PAGE>
14. GOVERNING LAW
The provisions of the Plan shall be governed by and interpreted in
accordance with the laws of Delaware.
15. EFFECTIVE DATE AND TERMINATION DATE OF PLAN
The effective date of the Plan shall be March 1, 1994, and the Plan shall
end on March 1, 2004.
B-8
<PAGE>
HELENE CURTIS INDUSTRIES, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS PROXY
FOR ANNUAL MEETING OF STOCKHOLDERS JUNE 28, 1994
The undersigned hereby appoint(s) Joseph L. Gidwitz, Michael Goldman, and
Gilbert P. Smith as proxies, with full power of substitution, and hereby
authorizes them or any of them to vote the stock of the undersigned at the
Annual Meeting of Stockholders of Helene Curtis Industries, Inc. (the "Company")
to be held in the Auditorium of the Harold Washington Library Center, 400 South
State St., Chicago, Illinois on June 28, 1994 at 10:00 a.m., and at any
adjournments thereof, as indicated on the other side of this card on the
proposals described in the Notice and Proxy Statement for such meeting and in
their discretion on other matters which may properly come before the meeting.
PLEASE COMPLETE THE OTHER SIDE, DATE, SIGN AND RETURN PROMPTLY.
<PAGE>
PLEASE MARK IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. / /
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
FOR ALL AGAINST ALL
NOMINEES LISTED NOMINEES LISTED FOR ALL NOMINEES LISTED
EXCEPT THE FOLLOWING:
1. ELECTION OF DIRECTORS:
The nominees for director / / / / / / _____________________________
are: Marshall L. Burman,
Frank W. Considine, and
Ronald J. Gidwitz
2. Proposal to approve the For Against Abstain 3. Proposal to approve the For Against Abstain
material terms of the the material terms of the
Executive Management 1994 Stock Appreciation
Incentive Plan. / / / / / / Right Plan. / / / / / /
4. Ratification of the For Against Abstain
selection of Coopers
& Lybrand as Independent / / / / / /
Accountants.
UNLESS OTHERWISE INSTRUCTED, THIS PROXY WILL BE VOTED
FOR ALL NOMINEES LISTED IN PROPOSAL 1 AND FOR
PROPOSALS 2, 3 AND 4.
Dated:_______________________________________ , 1994
____________________________________________________
____________________________________________________
Please sign exactly as your name appears. If acting
attorney, executor, trustee, or in representative
capacity, sign name and title.
Please indicate any changes in your address above.
</TABLE>
