SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) Preliminary Proxy Statement
(X) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
REEBOK INTERNATIONAL LTD.
(Name of Registrant as Specified In Its Charter)
REEBOK INTERNATIONAL LTD.
(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:
( ) 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>
REEBOK INTERNATIONAL LTD.
100 Technology Center Drive
Stoughton, Massachusetts 02072
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
May 2, 1995
Notice is hereby given that the Annual Meeting of
Shareholders of Reebok International Ltd. will be held at Silver
Auditorium, Sachar International Center, Brandeis University, 415
South Street, Waltham, Massachusetts at 10:00 a.m. local time on
Tuesday, May 2, 1995 for the following purposes:
1. To elect four Class II members of the Board of
Directors.
2. To transact any other business that may properly come
before the Meeting or any adjournment thereof.
Stockholders of record at the close of business on March 15,
1995 are entitled to notice of and to vote at the Meeting and any
adjournment thereof.
If you are unable to be present in person, please sign and
date the enclosed proxy and return it promptly in the enclosed
envelope.
By Order of the Board of Directors
JOHN E. BEARD
Clerk
March 30, 1995
<PAGE>
ANNUAL MEETING OF SHAREHOLDERS
May 2, 1995
PROXY STATEMENT
The enclosed proxy is solicited on behalf of the Board of
Directors of Reebok International Ltd. ("Reebok" or the
"Company") to be voted at the Annual Meeting of Shareholders to
be held on May 2, 1995 or at any adjournment thereof (the
"Meeting"). The cost of solicitation of proxies on behalf of the
Company's management will be borne by Reebok. Directors,
officers and employees of Reebok may also solicit proxies by
telephone, telegraph or personal interview. Reebok will
reimburse banks, brokerage firms and other custodians, nominees
and fiduciaries for reasonable expenses incurred by them in
sending proxy materials on behalf of the Company's management to
the beneficial owners of shares.
Only shareholders of record at the close of business on
March 15, 1995 are entitled to notice of and to vote at the
Meeting. There were 80,885,375 shares of the Company's common
stock, $.01 par value per share ("Common Stock"), outstanding on
that date, each of which is entitled to one vote. Under the by-
laws of the Company, a majority of the shares of Common Stock
issued and outstanding and entitled to vote will constitute a
quorum for the Meeting. If a quorum is present, the four
nominees for director who receive the greatest number of votes
properly cast (or a plurality of the votes) will be elected
directors. Votes cast by proxy or in person at the Annual
Meeting will be counted by persons selected by the Company to act
as election inspectors for the Meeting.
The election inspectors will count shares represented by
proxies that withhold authority to vote for a nominee for
election as a director or that reflect abstentions and "broker
non-votes" (i.e., shares represented at the Meeting held by
brokers or nominees as to which (i) instructions have not been
received from the beneficial owners or persons entitled to vote
and (ii) the broker or nominee does not have the discretionary
voting power on a particular matter) only as shares that are
present and entitled to vote on the matters for purposes of
determining the presence of a quorum, but neither proxies that
withhold authority (without naming an alternative nominee),
abstentions nor broker non-votes will be counted as votes cast at
the Annual Meeting. Such proxies therefore will have no effect
on the outcome of voting with respect to the election of
directors at the meeting.
Shares represented by proxies in the form enclosed, if
properly executed and returned and not revoked, will be voted at
the Meeting. To be voted, proxies must be filed with the Clerk
prior to voting. Proxies may be revoked at any time before
exercise by filing a notice of such revocation with the Clerk.
Proxies will be voted as specified by the shareholders. Where
specific choices are not indicated, proxies will be voted FOR the
election of all of the nominees for director identified below and
in the discretion of the named proxies as to any other matter
that may come before the meeting or any adjournments thereof.
The Annual Report to Shareholders for Reebok's fiscal year
ended December 31, 1994 has been mailed with this Proxy
Statement. This Proxy Statement and the enclosed proxy were
mailed to shareholders on the same date as the date of the Notice
of Annual Meeting. The principal executive offices of Reebok are
located at 100 Technology Center Drive, Stoughton, Massachusetts
02072.
ELECTION OF DIRECTORS
Pursuant to the provisions of Section 50A of Chapter 156B of
the Massachusetts General Laws, the Board of Directors is divided
into three classes, having staggered terms of three years each.
Under Section 50A and the by-laws of the Company, the Board of
Directors may determine the total number of directors and the
number of directors to be elected at any Annual Meeting of
Shareholders or Special Meeting in lieu
1
<PAGE>
thereof. The Board of Directors has fixed at twelve the total
number of directors and has fixed at four the number of directors
to be elected at the 1995 Annual Meeting. Of the current total
of twelve directors, four Class I directors have terms expiring
at the 1997 Annual Meeting, four Class III directors have terms
expiring at the 1996 Annual Meeting, and four Class II directors
have terms expiring at the 1995 Annual Meeting. The four
directors whose terms expire at the 1995 Annual Meeting have been
nominated by the Board of Directors for reelection at such
meeting. Each Class II director elected at the 1995 Annual
Meeting will serve until the 1998 Annual Meeting of Shareholders
or Special Meeting in lieu thereof, and until that director's
successor is elected and qualified.
Information With Respect to Nominees
Unless authority is withheld, proxies in the accompanying
form will be voted in favor of electing as Class II directors, to
hold office until the Annual Meeting of Shareholders in 1998 or
Special Meeting in lieu thereof, and until their respective
successors are elected and qualified, the four persons identified
in the table below. If the proxy is executed in such a manner as
to withhold authority to vote for one or more nominees for
director, such instructions will be followed by the persons named
as proxies.
All of the nominees for director are now Class II members of
the Board of Directors. The Company has no reason to believe
that any of the nominees will be unable to serve. In the event
that any nominee should not be available, the persons named in
the proxy will vote for the others and may vote for a substitute
for such nominee.
Listed below are the nominees for Class II director, with
information showing the business experience and current public
directorships, if any, of each, the age of each and the year each
was first elected a director of the Company.
Business Experience and Director
Name Current Directorships Age since
Paul R. Duncan ..........Executive Vice President 54 1989
(since 1990) and Chief
Financial Officer (since
1985) of the Company; Senior
Vice President of the Company
(1985-1990); Director of BGS
Systems, Inc., a computer
software development company;
Director of Cabletron Systems,
Inc., a computer networking
company.
William F. Glavin .......President, Babson College 62 1994
(since 1989); Director of
INCO Ltd., a producer of
of primary metals, alloys and
engineered products;
Director of The Caldor Corporation,
a discount retailer; and
Director of John Hancock Mutual
Funds, Inc., a mutual fund company.
Richard G. Lesser .......Executive Vice President 60 1988
and Chief Operating Officer
of TJX Companies, Inc., an
off-price specialty apparel
retailer.
William M. Marcus .......Executive Vice President, 57 1981
Treasurer and Director
of American Biltrite Inc.,
a manufacturer of flooring
and tape products; Director
of Congoleum Corp., a
vinyl and tile flooring company.
2
<PAGE>
Class III members of the Board of Directors having terms of
office expiring at the 1996 Annual Meeting of Shareholders are as
follows:
Business Experience and Director
Name Current Directorships Age since
Paul B. Fireman .........Chief Executive Officer 51 1979
(since 1979) and Chairman
of the Board of Directors
of the Company; President
of the Company (from 1979 to
March 1987 and since December
1989); Director of Abiomed,
Inc., a manufacturer of
medical devices.
Daniel E. Gill ..........Chairman and Chief Executive 58 1992
Officer and Director
of Bausch & Lomb, a health
care and optics company;
Director of Frontier
Corporation, a public
utility.
Robert Meers ............Executive Vice President of 51 1993
the Company with responsibility,
as President, for the
Company's Specialty Business
Group (since February 1994);
President, Reebok Division
U.S. Operations (from
November 1990 to January 1994)
and Canadian Operations
(January 1993 to January 1994);
Senior Vice President,
Sales and Marketing
of the Company
(July 1990 to November
1990); Senior Vice
President, Sales of The
Rockport Company, Inc. (from
December 1988 to July 1990).
Bertram M. Lee, Sr. .....Chairman of the Board of 56 1990
BML Associates Inc., a
holding company;
Chairman and
Treasurer of Albimar
Communications Co., a
broadcast communications
company; and President
of KELLEE Communications
Group, a pay telephone
company.
Class I members of the Board of Directors having terms
of office expiring at the 1997 Annual Meeting of Shareholders are
as follows:
Business Experience and Director
Name Current Directorships Age since
Jill Elikann Barad ......President, Chief Operating 43 1992
Officer (since July 1992)
and a Director (since November
1991) of Mattel, Inc., a toy
company; President-Mattel USA
(from 1990 to July 1992);
President-girls and activity
toys division of Mattel, Inc.
(1989 to 1990); Director of
Bank of America.
John H. Duerden .........Executive Vice President of 54 1991
the Company (since February
1994); Joint President
and Chief Operations
Officer of the
Reebok Division (since
September 1994);
President, International
Operations, Reebok Division
of the Company (from September
1992 to January 1994 and from
October 1988 to February 1990);
President of the Reebok Division
of the Company (February 1990 to
September 1992); Director of
Sunglass Hut International, a
retailer of sunglasses.
Geoffrey Nunes ..........Senior Vice President and 64 1986
General Counsel, Millipore
Corporation, a leader in
the field of separation
technology.
3
<PAGE>
John A. Quelch ..........Sebastian S. Kresge Professor 43
1985
of Marketing at the Graduate
School of Business
Administration, Harvard University;
Director of WPP Group
plc, a multi-national
marketing services company; Director
of U.S. Office Products Company, an
office equipment company.
During 1994, the Board of Directors held five meetings. All
of the directors attended at least 75% of the Board and relevant
committee meetings during 1994. For information on compensation
of Directors, see "Compensation of Directors" below.
The Audit Committee, composed of Messrs. Quelch, Lee, Lesser
and Marcus, held three meetings during 1994. The Audit Committee
recommends to the Board of Directors the independent public
accountants to be engaged by the Company; reviews with such
accountants and management the Company's internal accounting
procedures and controls; and reviews with such accountants the
scope and results of their audit of the consolidated financial
statements of the Company.
The Compensation Committee, composed of Messrs. Nunes and
Gill and Ms. Barad, administers the Company's stock option and
compensation plans, sets compensation for the Chief Executive
Officer, reviews the compensation of the other executive officers
and provides recommendations to the Board regarding compensation
matters. The Compensation Committee held two meetings during
1994.
The Board of Directors established a new committee on March
7, 1995, tentatively called the Board Affairs Committee, which is
composed of Messrs. Glavin, Lesser and Nunes. This Committee is
responsible for considering Board governance issues and will
assume the responsibility, previously held by the Compensation
Committee, for recommending individuals to serve as directors of
the Company and considering nominees recommended by security
holders. Recommendations by security holders should be submitted
in writing to the Board Affairs Committee, in care of the
President of the Company.
The Executive Committee, composed of Messrs. Fireman, Duncan
and Nunes, did not meet during 1994.
Compensation of Directors
During 1994, each director who was not an officer or
employee of the Company received $25,000 annually, plus $2,000
for each committee chairmanship held and $2,000 for each
directors' meeting and $1,000 for each committee meeting
attended, plus expenses.
The Company's Equity and Deferred Compensation Plan for
Directors (the "1994 Directors' Plan") provides for the issuance
of stock options to directors and provides a means by which
directors may defer all or a portion of their director fees. The
1994 Directors' Plan, which was approved by shareholders at the
1994 Annual Meeting, replaced the 1987 Stock Option Plan for
Directors and the Cash Deferral Plan for Directors.
The deferred compensation portion of the 1994 Directors'
Plan permits directors who are not employees of the Company to
defer all or a portion of their director compensation and to then
invest such compensation at the Merrill Lynch Corporate Bond Rate
or in Reebok Common Stock. Compensation deferred into Reebok
Common Stock is converted into stock based on the price of the
stock on the first day of the calendar quarter following the
quarter in which the fees were deferred. Dividends paid on the
Reebok Common Stock are also credited to the director's deferred
compensation account.
Directors who elect to defer their compensation will receive
a distribution of their deferred compensation in either a lump
sum or in annual installments (at the director's election) on a
date specified by the director or
4
<PAGE>
on the date on which the director is no longer a member of the
Reebok Board of Directors, whichever occurs first. If the
deferred compensation is invested at the corporate bond rate, the
distribution will be in cash in an amount equal to the deferred
compensation plus interest accrued. If the compensation is
deferred into Reebok Common Stock, the distribution will be in
the form of shares of Reebok Common Stock.
Under the stock option portion of the 1994 Directors' Plan,
each newly elected Eligible Director (as defined below) who is
elected to office is granted an option on the date of such
election to purchase shares of Reebok Common Stock having an
aggregate market value on such date equal to six times the
average cash compensation received by all directors in the
immediately prior calendar year. An Eligible Director is any
director who (i) is not an officer or employee of the Company and
is not a holder of more than 5% of the outstanding shares of the
Company's Common Stock or a person who is in control of such
holder. Upon his election to the Board of Directors on October
4, 1994, Mr. Glavin was granted an option to purchase 4,462
shares at an exercise price of $36.50 under the 1994 Directors'
Plan. After the initial grant, on April 28 of each year,
beginning April 28, 1995, each Eligible Director is granted an
option to purchase shares of Reebok Common Stock having a fair
market value on the date of such grant equal to three times the
average annual cash compensation received by all directors in the
immediately prior calendar year (or a pro rata portion based on
the date of his or her election). The exercise price for all
options granted under the 1994 Directors' Plan is the fair market
value of Reebok Common Stock on the date of the grant. Options
become exercisable for one-third of the shares covered thereby on
each of the first through third anniversaries of the grant.
During 1994, prior to the effective date of the 1994
Directors' Plan, Eligible Directors were granted an option to
purchase 4,000 shares of Reebok Common Stock pursuant to the 1987
Stock Option Plan for Directors (the "1987 Directors' Plan").
The exercise price of all options granted under the 1987
Directors' Plan is the fair market value of Common Stock on the
date of grant, and such options become exercisable for one-third
of the shares covered thereby on each of the first through third
anniversaries of the date of grant.
Of the current directors, Messrs. Fireman, Duncan, Duerden
and Meers are not Eligible Directors under the 1987 Directors'
Plan or the 1994 Directors' Plan.
During 1994, Mr. Lee and Mr. Quelch were paid for consulting
services to the Company in the amounts of $112,000 and $6,500,
respectively.
Beneficial Ownership of Shares
The following table sets forth certain information with
respect to the shares of Common Stock owned on March 15, 1995 by
persons owning of record or, to the knowledge of the Company,
beneficially 5% or more of the outstanding shares of Common
Stock. It also shows ownership by each director and nominee for
director, by each executive officer named in the Summary
Compensation Table below and by all directors and executive
officers of the Company as a group.
Common Stock
Beneficially Percent
Name Owned (1) Of Class (2)
Paul B. Fireman (3)(10)............ 7,168,156 8.51%
Phyllis Fireman (4)................ 5,047,002 5.99%
Jill E. Barad (5)(10).............. 11,389 *
John H. Duerden (10)............... 103,750 *
Paul R. Duncan (10)................ 174,468 *
Daniel E. Gill (5)(10)............. 16,056 *
William F. Glavin (5).............. 259 *
5
<PAGE>
Common Stock
Beneficially Percent
Name Owned (1) Of Class (2)
Bertram M. Lee, Sr. (5)(10)........ 7,442 *
Richard G. Lesser (6)(10).......... 34,005 *
William M. Marcus (7)(10).......... 619,686 *
Robert Meers (10).................. 83,030 *
Roberto Muller (8)(10)............. 92,829 *
Geoffrey Nunes (10)................ 35,199 *
John A. Quelch (5)(10)............. 27,762 *
Directors and executive officers
as a group (16 persons) (9)(10).. 8,543,194 10.14%
* Less than 1%.
(1) Except as otherwise noted, all persons and entities have
sole voting and investment power over their shares. All
amounts shown in this column include shares obtainable upon
exercise of stock options exercisable within 60 days of the
date of this table.
(2) Computed on the basis of 84,238,459 shares: 80,885,375
shares outstanding and 3,353,084 shares subject to options
exercisable within 60 days of the date of this table.
(3) Excludes 5,047,002 shares, as to which Mr. Fireman disclaims
beneficial ownership, that are beneficially owned by Phyllis
Fireman, his wife.
(4) Excludes 7,168,156 shares, as to which Mrs. Fireman
disclaims beneficial ownership, that are beneficially owned
by Paul Fireman, her husband.
(5) Includes for the following persons, the shares set forth
below, which represent shares deferred pursuant to the 1994
Directors' Plan: Jill E. Barad, 1,057 shares; Daniel E.
Gill, 1,057 shares; William F. Glavin 259 shares; Bertram M.
Lee, Sr., 543 shares; John A. Quelch, 229 shares.
(6) Excludes 3,576 shares held by Mr. Lesser's wife and child,
as to which he disclaims beneficial ownership.
(7) Excludes 29,969 shares held by Mr. Marcus' wife, as to which
he disclaims beneficial ownership.
(8) Includes 32,000 restricted shares held by Mr. Muller which
are subject to forfeiture by him if certain conditions are
not fulfilled.
(9) Excludes the 5,047,002 shares described in note (3) above,
the 29,969 shares described in note (7) above and the 3,576
shares described in note (6) above. Excludes 4,400 shares
held by an executive officer as custodian for his children
under the Uniform Gifts to Minors Act. Includes shares
subject to options held by directors and executive officers
that are exercisable within 60 days of the date of this
table (see note (10) below).
(10) Includes for the following persons, the shares set forth
below, which shares are subject to stock options exercisable
within 60 days of the date of this table: Paul B. Fireman,
2,000,000 shares; Jill E. Barad, 9,332 shares; John H.
Duerden, 103,750 shares; Paul R. Duncan, 160,000 shares;
Daniel E. Gill, 13,999 shares; Bertram M. Lee, Sr., 6,899
shares; Richard G. Lesser, 26,999 shares; William M. Marcus,
13,999 shares; Robert Meers 80,000 shares; Roberto Muller,
60,000 shares; Geoffrey Nunes, 33,999 shares; John A.
Quelch, 27,333 shares and all directors and executive
officers as a group, 2,701,310 shares.
The address of Mr. and Mrs. Fireman is c/o Reebok
International Ltd., 100 Technology Center Drive, Stoughton,
Massachusetts 02072.
6
<PAGE>
Executive Compensation
The following table sets forth the aggregate compensation
paid or accrued by the Company for services rendered during the
years ended December 1992, 1993 and 1994 for the Chief Executive
Officer and each of the Company's four other most highly
compensated executive officers:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation
___________________
Other
Annual
Name and Compen-
Principal Position Year Salary ($) Bonus ($) sation($)
__________________ ____ __________ _________ _________
<S> <C> <C> <C> <C>
Paul B. Fireman 1994 $1,000,012 $1,000,000 --
President and Chief 1993 1,000,012 650,000 --
Executive Officer 1992 1,019,243 585,000 --
John H. Duerden 1994 582,716 276,429 $159,081<3>
Executive Vice 1993 500,000 415,500 118,017<3>
President 1992 509,616 323,000 4,986<3>
Paul R. Duncan 1994 582,716 525,000 --
Executive Vice 1993 500,000 357,500 --
President and Chief 1992 506,766 325,000 --
Financial Officer
Robert Meers 1994 437,019 135,000 --
Executive Vice 1993 370,673 91,406 --
President 1992 356,250 113,750 --
Roberto Muller 1994 437,019 135,000 81,007<7>
Executive Vice 1993 368,007 215,625 70,054<7>
President 1992 296,346 119,763 --
</TABLE>
<TABLE>
<CAPTION>
Long Term Compensation
______________________
Awards
______________________
Securities All
Restricted Underlying Other
Name and Stock Options/ Compen-
Principal Position Year Awards ($) SARs (#) sation($)
__________________ ____ __________ __________ _________
<S> <C> <C> <C> <C>
Paul B. Fireman 1994 None None $68,786<1><2>
President and Chief 1993 None None 230,813<1><2>
Executive Officer 1992 None None 93,089<1><2>
John H. Duerden 1994 None None 26,504 <4>
Executive Vice 1993 None 25,000 93,442 <4>
President 1992 None None 49,635 <4>
Paul R. Duncan 1994 None None 16,412 <5>
Executive Vice 1993 None 25,000 76,885 <5>
President and Chief 1992 None None 38,017 <5>
Financial Officer
Robert Meers 1994 None None 16,412 <6>
Executive Vice 1993 None 25,000 42,863 <6>
President 1992 None None 25,854 <6>
Roberto Muller 1994 None<8> None 16,412 <9>
Executive Vice 1993 $924,000 25,000 28,540 <9>
President 1992 None 100,000 None
_________________
<1> Includes contributions by the Company on behalf of Mr.
Fireman as follows: for 1994, $16,412 to the Company's
Savings and Profit Sharing Retirement Plan (the "Profit
Sharing/Savings Plan"); for 1993, $15,940 to the Profit
Sharing/Savings Plan and $189,478 in credits allocated to
Mr. Fireman's account under the Company's Excess Benefits
Plan; for 1992, $15,475 to the Profit Sharing/Savings Plan
and $57,234 in credits allocated to Mr. Fireman's account
under the Excess Benefits Plan. Mr. Fireman is 100% vested
in these contributions and allocations.
<2> Includes $52,374 for 1994, reflecting the present value of
the economic benefit to Mr. Fireman of the portion of the
premium paid by the Company during 1994 ($1,107,115) with
respect to the split-dollar life insurance agreement (see
"Employee Agreements" below for a description of such
agreement), based on the time period between the date on
which the premium was paid by the Company and May 30, 1995,
which, as of March 30, 1995, is the earliest date on which
the Company could terminate the agreement and receive a
refund, without interest, of the premium it paid. Includes
$25,395 for 1993 and $20,380 for 1992, as reported in the
Company's 1993 and 1992 Proxy Statements, respectively,
reflecting the present value of the economic benefit to Mr.
Fireman of the premium paid during 1993 and 1992 ($966,862
and $717,146, respectively) with respect to the same
agreement, calculated on the same basis.
<3> Includes: for 1994, $38,620 reimbursement for expenses
associated with a relocation from the U.K. to the U.S.,
$113,461 for reimbursement to Mr. Duerden for a loss on the
sale of his U.S. residence in connection with his relocation
from the U.S. to the U.K. and $7,000 for car allowance; for
1993, $19,314 for the use of a Company car by Mr. Duerden,
and $98,703 representing reimbursement for expenses
associated with a relocation from the U.S. to the U.K.; and
for 1992, $4,986 reflects compensation attributable to Mr.
Duerden as a result of an interest free loan received by
him.
7
<PAGE>
<4> Includes contributions by the Company on behalf of Mr.
Duerden as follows: for 1994, $16,412 to the Profit
Sharing/Savings Plan and $10,092 for life insurance; for
1993, $15,940 to the Profit Sharing/Savings Plan, $68,396 in
credits allocated to Mr. Duerden's account under the Excess
Benefits Plan and $9,106 for life insurance; for 1992,
$15,475 to the Profit Sharing/Savings Plan, $27,048 in
credits allocated to Mr. Duerden's account under the Excess
Benefits Plan and $7,112 for life insurance. Mr. Duerden is
100% vested in the contributions and allocations to the
Profit Sharing/Savings Plan and the Excess Benefits Plan.
<5> Includes contributions by the Company on behalf of Mr.
Duncan as follows: for 1994, $16,412 to the Profit
Sharing/Savings Plan; for 1993, $15,940 to the Profit
Sharing/Savings Plan and $60,945 in credits allocated to Mr.
Duncan's account under the Excess Benefits Plan; for 1992,
$15,475 to the Profit Sharing/Savings Plan and $22,542 in
credits allocated to Mr. Duncan's account under the Excess
Benefits Plan. Mr. Duncan is 100% vested in these
contributions and allocations.
<6> Includes contributions by the Company on behalf of Mr. Meers
as follows: for 1994, $16,412 to the Profit Sharing/Savings
Plan; for 1993, $15,940 to the Profit Sharing/Savings Plan
and $26,923 in credits allocated to Mr. Meers' account under
the Excess Benefits Plan; for 1992, $15,475 to the Profit
Sharing/Savings Plan and $10,379 in credits allocated to Mr.
Meers' account under the Excess Benefits Plan. Mr. Meers is
100% vested in these contributions and allocations.
<7> Includes amounts representing reimbursement for housing
expenses incurred by Mr. Muller in connection with his
maintaining an apartment in Massachusetts as follows: for
1994, $69,007; for 1993, $58,054 and for 1992, $37,098.
Also includes amounts for car allowance: for 1994, $12,000;
for 1993, $12,000; and for 1992, $11,000.
<8> As of December 31, 1994, Mr. Muller held 32,000 shares of
restricted Common Stock granted to him on December 15, 1993
under the 1994 Equity Incentive Plan. The fair market value
of such shares on December 31, 1994 was $1,264,000. Cash
dividends declared by the Company on its Common Stock are
paid to Mr. Muller with regard to these restricted shares.
<9> Includes contributions by the Company on behalf of Mr.
Muller as follows: for 1994, $16,412 to the Profit
Sharing/Savings Plan; for 1993, $15,940 to the Profit
Sharing/Savings Plan and $12,600 in credits allocated to Mr.
Muller's account under the Excess Benefits Plan. Mr. Muller
is 40% vested in these contributions and allocations.
</TABLE>
8
<PAGE>
The following table sets forth aggregated option exercises
in 1994 and option values as of December 31, 1994 for the Chief
Executive Officer and each of the four other most highly
compensated executive officers:
<TABLE>
<CAPTION>
AGGREGATED OPTION/SAR EXERCISES IN 1994
AND OPTION/SAR VALUES AS OF DECEMBER 31, 1994
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs Options/SARs
at 12/31/94(#) at 12/31/94($)
______________ ______________
Shares
Acquired Value Exercisable/ Exercisable/
Name on Exercise (#) Realized ($) Unexercisable Unexercisable
____ _______________ ____________ _____________ _____________
<S> <C> <C> <C> <C>
Paul B. Fireman None 0 2,000,000/ $43,490,000/
500,000 10,565,000
John H. Duerden None 0 203,750/ 4,905,381/
35,000 522,525
Paul R. Duncan 93,750 $2,517,012 160,000/ 3,432,000/
35,000 522,525
Robert Meers None 0 80,000/ 1,875,500/
100,000 1,193,750
Roberto Muller None 0 40,000/ 80,400/
85,000 141,450
</TABLE>
Employee Agreements
Mr. Fireman has a Stock Option Agreement with the Company
pursuant to which he received in 1990 a grant of options to
purchase 2.5 million shares of the Company's Common Stock at
exercise prices ranging from $17.32 to $18.37 per share, which
become exercisable in stages over a five-year period ending July
24, 1995. Options to purchase 2,000,000 shares are currently
exercisable pursuant to this grant. The options will remain
exercisable until July 24, 2000, as long as (i) Mr. Fireman
remains available to serve the Company as an employee, director
or consultant, and (ii) Mr. Fireman does not compete with the
Company in any manner.
The Company entered into a split-dollar insurance agreement
as of September 25, 1991 with a trust established by Paul
Fireman, pursuant to which the Company and that trust will share
in the premium costs of a whole life insurance policy that pays a
death benefit of not less than $50 million upon the death of Paul
Fireman, age 51 or Phyllis Fireman, age 50 (whichever occurs
later). The Company pays that portion of each annual policy
premium that, in general terms, equals the annual increase in the
cash value of the policy. The Company may cause the agreement to
be terminated and the policy to be surrendered at any time upon
60 days prior notice. Upon surrender of the policy or payment of
the death benefit thereunder, the Company is entitled to
repayment of an amount equal to the cumulative premiums
previously paid by the Company, with all remaining payments to be
made to the Fireman trust. See footnote (2) to the "Summary
Compensation Table" above for further information on premium
payments made by the Company under this policy.
The Company has an employment agreement with Mr. Duerden,
which was effective December 19, 1991 and which automatically
continues thereafter for continuously renewing three-year periods
until December 31, 2000, unless otherwise terminated or renewed
by mutual agreement. Mr. Duerden's agreement includes a pension
program which, subject to certain vesting provisions, provides a
pension for the balance of his life equal to two-thirds of his
average base salary (his base salary appears under "Salary" in
the "Summary Compensation Table" above) over the final three
years of his employment (reduced by amounts receivable by
9
<PAGE>
him from certain other pensions, profit sharing accounts and
Social Security) and to begin on the later of his last date of
employment or attainment of age 60. Mr. Duerden's entitlement to
this pension program will vest in increments of 1/12 for each
full year of employment from October 1, 1988. He currently has
six years of service with the Company and is 50% vested.
The following table shows the estimated annual benefits
payable upon retirement to Mr. Duerden assuming the various years
of service and salary classifications set forth in the table and
no reduction by amounts receivable by him from certain other
pension accounts, profit sharing accounts and Social Security:
<TABLE>
<CAPTION>
Pension Plan Table
Years of Service
6 9 12
Remuneration
<S> <C> <C> <C>
$530,777 $176,926 $265,389 $353,851
580,000 193,333 290,000 386,666
630,000 210,000 315,000 420,000
680,000 226,666 340,000 453,333
730,000 243,333 365,000 486,666
</TABLE>
If Mr. Duerden's employment is terminated by the Company
other than for cause, he would be entitled to receive his base
salary for the remainder of the term of the agreement and any
annual incentive compensation (pro-rated) for the year in which
the termination occurs. In addition, any stock options
exercisable within one year of his last date of employment would
become immediately exercisable. If Mr. Duerden's employment is
voluntarily terminated or terminated for cause, he will be
entitled to receive his base salary only through his termination
date. In addition, upon voluntary termination: if he leaves no
earlier than the public announcement of year-end audited
consolidated results for the prior fiscal year, he will receive
monthly payments of 1/2 his monthly base salary for consulting
services until the end of the fiscal year in which his employment
is terminated, and if he leaves no earlier than May 1 of the
fiscal year in which his employment is terminated, he also would
be entitled to any stock options which become exercisable during
such fiscal year.
The Company has change of control agreements with Mr. Duncan
and Mr. Duerden providing for certain compensation and benefits
in the event of the termination of their employment with the
Company following a "change in control" of the Company (as
defined in the respective agreements). In the agreement with Mr.
Duerden, a "change in control" does not include one which is
initiated by Company management, while in the agreement with Mr.
Duncan it does. In each agreement, if the executive's employment
with the Company were to terminate within 12 months following a
change in control either on an involuntary basis (other than as a
result of death, total disability, retirement, commission of a
felony or conviction of a crime involving moral turpitude) or, in
the agreement with Mr. Duerden, in the event of a voluntary
termination following a downgrading of title, responsibilities or
compensation, and in the agreement with Mr. Duncan in the event
of any voluntary termination, then the Company will pay to the
executive a lump-sum cash payment equal to four times the
aggregate of his then current annual base salary and his cash
bonus for the most recent calendar year ended before the change
in control. In addition, all of the executive's outstanding
stock options, restricted shares and other incentive rights and
interests will become immediately and fully vested and
exercisable. The executive's dependents will also continue to
participate fully at the expense of the Company in all accident
and health plans provided by the Company immediately prior to the
change in control, or receive substantially equivalent coverage,
for the year following his termination. In addition, the
agreements provide that the executive will be reimbursed by the
Company for any legal fees incurred by him as a result of the
termination of his employment. Receipt by the executive of the
foregoing benefits is subject to his willingness to remain in the
employ of the Company or its successor for at least six months
after the change in
10
<PAGE>
control to assist in the transition. Mr. Duncan and Mr. Duerden
are also required not to leave voluntarily the employ of the
Company in the event that any person or entity initiates a change
in control until such time as the effort terminates or the change
in control is completed. Mr. Duerden must choose either the
benefits of this agreement or the employment agreement mentioned
above, in the event both are applicable.
The above description is only a summary of the agreements
which the Company has with its various executive officers and is
qualified in its entirety by the actual agreements, copies of
which have been filed as Exhibits to the Company's Annual Reports
on Form 10-K.
Report of Compensation Committee
on Executive Compensation
The Compensation Committee has submitted the following
report:
The Committee currently consists of Geoffrey Nunes,
Chairman, Daniel E. Gill, and Jill E. Barad. Its
responsibilities include setting the compensation level for the
Chief Executive Officer and reviewing compensation levels for all
other executive officers of the Company. Compensation for these
individuals is established by the Chief Executive Officer. The
Committee also functions as the stock option committee, and in
that capacity grants all stock options to executive officers.
Reebok's Chief Executive Officer, Paul Fireman, had a base
salary in 1994 of $1,000,000 and was eligible for a bonus for
1994 with a target of 100% of base salary. Mr. Fireman's salary
and bonus target were established in 1990 and have not been
changed since that time.
For 1994, the Committee made a subjective decision to award
Mr. Fireman a bonus of $1,000,000 (100% of target bonus). The
Committee decided to award the full target bonus because the
Company met its 1994 profit target, which had been reviewed in
advance by the Board of Directors. By prior arrangement, Mr.
Fireman has agreed to defer receipt of this bonus until he is no
longer an employee of the Company in order to preserve its
deductibility for U.S. income tax purposes.
The Committee reviews the compensation for all executive
officers other than the Chief Executive Officer on an annual
basis. The Committee met in February 1994 to review base salary
levels, target bonus levels, and the executive bonus plan for
1994 and made a subjective judgment that compensation levels for
the executive officers were neither unduly high nor unduly low.
While survey data had been considered by the Committee in
reviewing 1993 compensation levels, as described in last year's
Compensation Committee Report, new survey data was not considered
by the Committee in its review of 1994 compensation levels. The
Committee believes that it had sufficient collective knowledge to
make an appropriate judgment concerning compensation levels
without new survey data.
The Committee met again in March 1995 to review the
executive officer compensation program for 1995. While 1995
compensation will not be addressed in this report, the Committee
notes that its review of survey data in connection with the 1995
executive officer total compensation program supports its
conclusion that 1994 compensation levels were within an
appropriate range. The Committee intends to review survey data
on an annual basis in the future.
The Committee also reviewed actual bonus awards to the
executive officer group for both calendar year 1993 and 1994 at
its March 1995 meeting. These awards were neither unduly high
nor unduly low, in the Committee's subjective judgment, based on
the annual incentive plans in effect and the Company's financial
performance during these two calendar years.
11
<PAGE>
The Committee has granted stock options to executive
officers to provide long-term performance related incentives that
link rewards directly to shareholder gains over a multi-year
period. No options were granted to the executive officers during
calendar year 1994 because the Committee decided to change the
time at which such awards would be considered from December (as
has been its usual practice) of 1994 to March 1995 in order to
have better information concerning the Company's financial
performance for the year and the contribution of the executive
officers to such performance.
In adopting and administering executive compensation plans
and arrangements, the Committee considers whether the deducti-
bility of such compensation will be limited under Section 162(m)
of the Internal Revenue Code and, in appropriate cases, will
strive to structure such compensation so that any such limitation
will not apply.
Geoffrey Nunes, Chairman
Jill E. Barad
Daniel E. Gill
12
<PAGE>
Performance Graph
The following graph demonstrates a five year comparison of
cumulative total returns for the Company's Common Stock, the
Standard & Poor's 500 Stock Index, and the Standard & Poor's
Shoes and Textile Apparel Manufacturers Indices* from December
31, 1989 to December 31, 1994. The graph assumes an investment
of $100 on December 31, 1989 in each of the Company's Common
Stock and the stocks comprising the Standard & Poor's 500 Stock
Index and the Standard & Poor's Shoes and Textile Apparel
Manufacturers Indices. Each of the indices assumes that all
dividends were reinvested.
<TABLE>
<CAPTION>
Base December Indexed Returns
($) (Dollars)
Company/Index
Name 1989 1990 1991 1992 1993 1994
<S> <C> <C> <C> <C> <C> <C>
Reebok
International
Ltd. 100 61.93 180.31 186.96 166.70 221.40
S&P 500 Index 100 96.89 126.42 136.05 149.76 151.74
Shoes 100 101.72 209.62 226.17 159.05 215.84
Textiles 100 86.98 139.50 148.50 112.28 109.97
</TABLE>
-----------------------
* The Standard & Poor's Shoes and Textile Apparel Manufacturers
Indices were selected in order to compare the Company's
performance with companies in each of the two primary lines of
business in which the Company is engaged. The indices do not,
however, include all of the Company's competitors, nor all
product categories and lines of business in which the Company is
engaged.
13
<PAGE>
The following graph demonstrates a comparison of cumulative
total returns for the Company's Common Stock, the Standard &
Poor's 500 Stock Index, and the Standard & Poor's Shoes and
Textile Apparel Manufacturers Indices from July 26, 1985, the
date of the Company's initial public offering, through December
31, 1994, and was prepared in the same manner as the five year
performance graph. This graph is included to show the Company's
historical stock performance for the entire period since the
Company's stock first became publicly traded.
<TABLE>
<CAPTION>
December Indexed Returns
(Dollars)
Base
Company/ ($)
Index Name 7-26-85 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Reebok
International
Ltd. 100 139.14 348.43 320.61 377.96 597.60 370.08 1077.50 1117.30 996.17 1323.11
S&P 500 Index 100 112.05 132.91 139.79 163.01 214.66 208.00 271.37 292.04 321.48 325.72
Shoes 100 112.27 121.99 114.82 182.58 284.03 288.90 595.37 642.39 451.76 613.04
Textiles 100 120.88 173.32 139.73 158.19 208.41 181.28 290.74 309.49 234.00 229.18
</TABLE>
Transactions with Management and Affiliates
Mr. Duerden received a mortgage loan from the Company in May
1994 which bears interest at the rate of 6.75% per annum for the
purchase of a residence in connection with his relocation from
the U.K. to the United States. The largest aggregate principal
amount of the loan outstanding since January 1, 1994 was $350,000
plus accrued interest.
Mr. Muller received a loan in July 1993 in the amount of
$350,000 which bears interest at the rate of 6% per annum. The
largest aggregate principal amount of the loan outstanding since
January 1, 1994 was $350,000 plus accrued interest.
In connection with his relocation from California to
Massachusetts, the Company leases a house to Angel Martinez, an
Executive Vice President of the Company, for a period expiring
October 31, 1995. Mr. Martinez is not required to pay rent to
the Company while he continues to bear the carrying costs of his
California residence and remains employed by the Company. The
fair market value of the monthly rent for such
14
<PAGE>
residence is believed to be approximately $5,000. Mr. Martinez
has an option to purchase the residence during the term of the
lease for a price equal to the amount paid by the Company for the
residence, including certain renovations, plus the depreciated
value of certain furnishings purchased for the residence by the
Company and closing costs paid by the Company in connection with
the purchase of the residence. If Mr. Martinez sells his
California residence or is no longer employed by the Company, the
option to purchase and the lease will automatically terminate.
Steve Fireman, the brother of Paul Fireman, is employed by
the Company. During 1994, Steve Fireman was a senior executive
with responsibility for Boks casual footwear. He is currently
employed by the Company in a corporate staff position. He
received compensation and benefits equivalent to that of other
employees of the Company holding similar positions and his
compensation is reviewed annually by the Compensation Committee.
OTHER INFORMATION
Compliance with Section 16(a) of the Securities Exchange Act of
1934
Section 16(a) of the Securities Exchange Act of 1934
requires the Company's executive officers and directors to file
initial reports of ownership and reports of changes in ownership
with the SEC and the New York Stock Exchange. Executive officers
and directors are required by SEC regulations to furnish the
Company with copies of all Section 16(a) forms they file. To the
Company's knowledge, based solely on a review of the copies of
such forms furnished to the Company and written representations
from the Company's executive officers and directors, all required
Section 16(a) filings were made.
Audit Matters
Ernst & Young LLP has been selected to audit the
consolidated financial statements of the Company for the year
ended December 31, 1995, and to report the results of their audit
to the Audit Committee of the Board of Directors.
A representative of Ernst & Young LLP is expected to be
present at the Annual Meeting and will be afforded the
opportunity to make a statement if he desires to do so and to
respond to appropriate questions from shareholders.
Shareholder Proposals
Proposals of shareholders submitted for consideration at the
Annual Meeting of Shareholders in 1996 must be received by the
Company no later than November 30, 1995.
Other Business
The Board of Directors knows of no business that will come
before the meeting for action except as described in the
accompanying Notice of Meeting. However, as to any such
business, the persons designated as proxies will have
discretionary authority to act in their best judgment.
Form 10-K
A COPY OF REEBOK'S ANNUAL REPORT ON FORM 10-K FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS AVAILABLE WITHOUT CHARGE BY
WRITING TO: OFFICE OF INVESTOR RELATIONS, REEBOK INTERNATIONAL
LTD., 100 TECHNOLOGY CENTER DRIVE, STOUGHTON, MASSACHUSETTS
02072.
March 30, 1995
15
<PAGE>
ANNUAL MEETING OF REEBOK INTERNATIONAL LTD.
May 2, 1995
The undersigned hereby constitutes and appoints PAUL R.
DUNCAN and JOHN B. DOUGLAS III, or either of them with power of
substitution to each, proxies to vote and act at the Annual
Meeting of Shareholders to be held at Silver Auditorium, Sachar
International Center, Brandeis University, 415 South Street,
Waltham, Massachusetts on May 2, 1995 at 10:00 a.m., and at any
adjournments thereof, upon and with respect to the number of
shares of Common Stock of the Company as to which the undersigned
may be entitled to vote or act. The undersigned instructs such
proxies, or their substitutes, to vote in such manner as they may
determine on any matters which may come before the meeting, all
as indicated in the accompanying Notice of Meeting and Proxy
Statement, receipt of which is acknowledged, and to vote on the
following as specified by the undersigned. All proxies
heretofore given by the undersigned in respect of said meeting
are hereby revoked.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
Unless otherwise specified in the boxes provided on the reverse
side hereof, this proxy will be voted IN FAVOR of all nominees
for director and in the discretion of the named proxies as to any
other matter that may come before the meeting or any adjournments
thereof.
CONTINUED, AND TO BE SIGNED, ON REVERSE SIDE SEE REVERSE
SIDE
<PAGE>
(X) Please mark
votes as in
this example.
PLEASE DO NOT FOLD THIS PROXY
1. Election of Class II Directors
The undersigned hereby GRANTS authority to elect
as Class II directors the following nominees:
Nominees: Paul R. Duncan, William F. Glavin,
Richard G. Lesser, William M. Marcus
FOR WITHHELD
( ) ( )
( ) __________________________________________
For all nominees except as noted above
MARK HERE ( )
FOR ADDRESS
CHANGE AND
NOTE AT LEFT
Please sign exactly as your name(s) appear hereon. When
signing as attorney, executor, administrator, trustee, or
guardian, please sign your full title as such. Each joint
owner should sign.
Signature: _____________________________ Date _________________
Signature: _______________________________ Date _________________
<PAGE>
