<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934 (Amendment No. ____)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
Johnson Outdoors Inc.
(Name of Registrant as Specified in its Charter)
-----------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE> 2
JOHNSON OUTDOORS Logo
JOHNSON OUTDOORS INC.
1326 WILLOW ROAD
STURTEVANT, WISCONSIN 53177
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JANUARY 31, 2001
To the Shareholders of
JOHNSON OUTDOORS INC.
The Annual Meeting of Shareholders of Johnson Outdoors Inc. will be held on
Wednesday, January 31, 2001 at 10:00 a.m., local time, at the Company's
Headquarters, located at 1326 Willow Road, Sturtevant, Wisconsin, for the
following purposes:
1. To elect 6 directors to serve for the ensuing year.
2. To consider and act upon a shareholder proposal to sell the Company.
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
Shareholders of record at the close of business on Monday, December 11,
2000 will be entitled to notice of and to vote at the meeting and any
adjournment or postponement thereof. Holders of Class A common stock, voting as
a separate class, are entitled to elect two directors and holders of Class B
common stock, voting as a separate class, are entitled to elect the remaining
directors.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE,
SIGN, DATE AND RETURN PROMPTLY THE PROXY CARD FOR CLASS A COMMON STOCK AND/OR
THE PROXY CARD FOR CLASS B COMMON STOCK IN THE RETURN ENVELOPE PROVIDED IN ORDER
TO BE SURE THAT YOUR SHARES WILL BE VOTED AT THE ANNUAL MEETING.
By Order of the Board of Directors
/s/ HELEN JOHNSON-LEIPOLD
HELEN JOHNSON-LEIPOLD
Chairman and Chief Executive
Officer
Sturtevant, Wisconsin
December 28, 2000
<PAGE> 3
JOHNSON OUTDOORS INC.
1326 WILLOW ROAD
STURTEVANT, WISCONSIN 53177
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JANUARY 31, 2001
This Proxy Statement, which is first being mailed to shareholders on or
about December 28, 2000, is furnished in connection with the solicitation of
proxies by the Board of Directors of Johnson Outdoors Inc. (the "Company") to be
used at the Annual Meeting of Shareholders of the Company to be held on
Wednesday, January 31, 2001 at 10:00 a.m., local time, at the Company's
Headquarters, located at 1326 Willow Road, Sturtevant, Wisconsin, and at any
adjournment or postponement thereof ("Annual Meeting").
Shareholders who execute proxies may revoke them at any time before they
are voted by written notice addressed to the Secretary at the Company's address
shown above, or by giving notice in open meeting. Unless so revoked, the shares
represented by proxies received by the Board of Directors will be voted at the
Annual Meeting. Where a shareholder specifies a choice by means of a ballot
provided in the proxy, the shares will be voted in accordance with such
specification.
The record date for shareholders entitled to notice of and to vote at the
Annual Meeting is December 11, 2000. On the record date, the Company had
outstanding and entitled to vote 6,924,630 shares of Class A common stock and
1,222,729 shares of Class B common stock. Holders of Class A common stock are
entitled to one vote per share for directors designated to be elected by holders
of Class A common stock and for other matters. Holders of Class B common stock
are entitled to one vote per share for directors designated to be elected by
holders of Class B common stock and ten votes per share for other matters.
ELECTION OF DIRECTORS
Six directors are to be elected at the Annual Meeting to serve until the
next annual meeting of shareholders or until their respective successors have
been duly elected. The Company's Articles of Incorporation provide that holders
of Class A common stock have the right to elect 25% of the authorized number of
directors and the holders of Class B common stock are entitled to elect the
remaining directors. At the Annual Meeting, holders of Class A common stock will
elect two directors and holders of Class B common stock will elect four
directors. Glenn N. Rupp and Terry E. London (the "Class A Directors") are the
nominees designated to be voted on by the holders of Class A common stock, and
Samuel C. Johnson, Helen P. Johnson-Leipold, Thomas F. Pyle, Jr. and Gregory E.
Lawton (the "Class B Directors") are the nominees designated to be voted on by
the holders of Class B common stock.
Proxies received from holders of Class A common stock will, unless
otherwise directed, be voted for the election of the nominees designated to be
voted on by the holders of Class A common stock and proxies received from
holders of Class B common stock will, unless otherwise directed, be voted for
the election of the nominees designated to be voted on by the holders of Class B
common stock. Proxies of holders of Class A common stock cannot be voted for
more than two persons and proxies of holders of Class B common stock cannot be
voted for more than four persons. Class A Directors are elected by a plurality
of the votes cast by the
1
<PAGE> 4
holders of Class A common stock and Class B Directors are elected by a plurality
of the votes cast by the holders of Class B common stock, in each case at a
meeting at which a quorum is present. "Plurality" means that the individuals who
receive the largest number of votes cast by holders of the class of common stock
entitled to vote in the election of such directors are elected as directors up
to the maximum number of directors to be chosen at the meeting by such class.
Consequently, any shares not voted on this matter (whether by abstention, broker
non-vote or otherwise) will have no effect on the election of directors, except
to the extent the failure to vote for an individual results in that individual
not receiving a sufficient number of votes to be elected.
Listed below are the nominees of the Board of Directors for election at the
Annual Meeting. Each of the nominees is presently a director of the Company. If
any of the nominees should be unable or unwilling to serve, the proxies,
pursuant to the authority granted to them by the Board of Directors, will have
discretionary authority to select and vote for substituted nominees. The Board
of Directors has no reason to believe that any of the nominees will be unable or
unwilling to serve.
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE DIRECTOR
NAME AGE DURING LAST FIVE YEARS SINCE
---- --- ---------------------- --------
<S> <C> <C> <C>
Samuel C. Johnson...................... 72 Chairman of the Board of the Company 1970
from January 1994 to March 1999. Until
October 2000, Chairman of S.C. Johnson
& Son, Inc. (manufacturer of household
maintenance and industrial products)
(SCJ). Director of H.J. Heinz Company.
Mr. Johnson is the father of Helen P.
Johnson-Leipold.
Thomas F. Pyle, Jr..................... 59 Vice Chairman of the Board of the 1987
Company since October 1997. Chairman
of The Pyle Group since September 1996
(financial services and investments).
Chairman, President and Chief
Executive Officer of Rayovac
Corporation (manufacturer of batteries
and lighting products) from 1982 until
September 1996. Director of Kewaunee
Scientific Corporation and Sub Zero
Corporation.
Helen P. Johnson-Leipold............... 43 Chairman and Chief Executive Officer 1994
of the Company since March 1999. Vice
President, Worldwide Consumer
Products-Marketing of SCJ from
September 1998 to March 1999. Vice
President, Personal and Home Care
Products of SCJ from October 1997 to
September 1998. Executive Vice
President -- North American Businesses
of the Company from October 1995 until
July 1997. Vice President -- Consumer
Marketing Services Worldwide of SCJ
from 1992 to September 1995. Ms.
Johnson-Leipold is the daughter of
Samuel C. Johnson.
</TABLE>
2
<PAGE> 5
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE DIRECTOR
NAME AGE DURING LAST FIVE YEARS SINCE
---- --- ---------------------- --------
<S> <C> <C> <C>
Gregory E. Lawton...................... 49 President and Chief Executive Officer 1997
of Johnson Wax Professional
(manufacturer of industrial
maintenance products) since January
1999. President and Chief Executive
Officer of NuTone, Inc. (manufacturer
of ventilation fans, intercom systems
and other home products) from July
1994 to January 1999. Director of SCJ
Commercial Markets, Inc., General
Cable Corporation and Superior Metal
Products, Inc.
Glenn N. Rupp.......................... 56 Chairman and Chief Executive Officer 1997
of Converse Inc. (manufacturer and
marketer of athletic and leisure
footwear) since April 1996. Acting
Chairman of McKenzie Sports Products
Inc. from August 1994 to April 1996.
Terry E. London........................ 51 Until July 2000, President and Chief 1999
Executive Officer and a Director of
Gaylord Entertainment Company
(hospitality and attractions, creative
content and interactive media)
(Gaylord) since May 1997. Executive
Vice President and Chief Operating
Officer of Gaylord from March 1997 to
May 1997. Senior Vice President and
Chief Financial and Administrative
Officer of Gaylord from September 1993
to March 1997.
</TABLE>
COMMITTEES
The Board of Directors has standing Executive, Audit, Compensation and
Stock Committees and does not have a nominating committee.
The Executive Committee assists the Board of Directors in developing and
evaluating general corporate policies and objectives and, subject to certain
limitations, has the power to exercise fully the powers of the Board of
Directors. Present members of the Executive Committee are Messrs. Johnson
(Chairman) and Pyle and Ms. Johnson-Leipold.
The Audit Committee presently consists of Messrs. Rupp (Chairman), Pyle and
London, each of whom is independent as defined in Rule 4200(a)(15) of the
listing standards of the National Association of Securities Dealers, Inc. The
Audit Committee's primary duties and responsibilities are to: (1) serve as an
independent and objective party to monitor the Company's financial reporting
process and internal control system; (2) review and appraise the audit efforts
of the Company's independent auditors and internal auditors (if any); and (3)
provide an open avenue of communication among the independent auditors,
financial and senior management, the internal auditors, and the Board of
Directors.
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<PAGE> 6
The Compensation Committee presently consists of Messrs. Pyle (Chairman),
Rupp and London. The Compensation Committee determines all compensation and
benefits, except for equity-based compensation, of the executive officers and
key employees of the Company.
The Stock Committee presently consists of Messrs. London (Chairman), Pyle
and Rupp. The Stock Committee determines all equity-based compensation for
executive officers and key employees of the Company. The Stock Committee
administers the Johnson Outdoors Inc. Amended and Restated 1986 Stock Option
Plan, the Johnson Outdoors Inc. 1987 Employees' Stock Purchase Plan, the Johnson
Outdoors Inc. 1994 Long-Term Stock Incentive Plan and the Johnson Outdoors Inc.
2000 Long-Term Stock Incentive Plan.
Committee assignments will be reviewed prior to or at the next meeting of
the Board of Directors to be held in 2001.
AUDIT COMMITTEE REPORT
In accordance with its written charter adopted by the Board of Directors, a
copy of which is attached to this Proxy Statement as Appendix A, the Audit
Committee assists the Board of Directors in fulfilling its responsibility for
oversight of the quality and integrity of the financial reporting practices of
the Company.
In discharging its oversight responsibility as to the audit process, the
Audit Committee discussed with the independent auditors their independence from
the Company and its management. In addition, the independent auditors provided
the Audit Committee with written disclosure respecting their independence and
the letter required by Independence Board Standard No. 1 ("Independence
Discussions with Audit Committees").
The Audit Committee discussed and reviewed with the independent auditors
all communications required by generally accepted auditing standards, including
those described in Statement on Auditing Standards No. 61 ("Communication with
Audit Committees") and, with and without management present, discussed and
reviewed the results of the independent auditors' examination of the Company's
consolidated financial statements.
The Audit Committee reviewed the audited consolidated financial statements
of the Company for the fiscal year ended September 29, 2000 with management and
the independent auditors. Management has the responsibility for the preparation
of the Company's financial statements and the independent auditors have the
responsibility for the examination of those statements.
Based upon the above-mentioned review and discussions with management and
the independent auditors, the Audit Committee recommended to the Board of
Directors that the Company's audited consolidated financial statements be
included in its Annual Report on Form 10-K for the fiscal year ended September
29, 2000 for filing with the Securities and Exchange Commission.
This report shall not be deemed incorporated by reference by any general
statement incorporating by reference this Proxy Statement into any filing under
the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934,
as amended, and shall not otherwise be deemed filed under such Acts.
The Audit Committee of the Board of
Directors
Glenn N. Rupp, Chairman
Thomas F. Pyle, Jr.
Terry E. London
4
<PAGE> 7
MEETINGS AND ATTENDANCE
During the year ended September 29, 2000, there were eight meetings of the
Board of Directors, two meetings of the Audit Committee, four meetings of the
Compensation Committee, no meetings of the Stock Committee (all actions were
taken by unanimous written consent) and no meetings of the Executive Committee.
All directors attended at least 75% of the meetings of the Board of Directors
and at least 75% of the meetings of the committees on which they serve.
COMPENSATION OF DIRECTORS
Retainer and Fees. Each director who is not an employee of the Company
("non-employee director") is entitled to receive an annual retainer of $15,000
and $1,000 for each meeting of the Board of Directors and each committee meeting
attended. The Vice Chairman of the Board receives an additional annual retainer
of $35,000. Non-employee directors are also entitled to receive an annual
retainer for serving on committees of the Board of Directors as follows: the
Chairman of each committee receives $3,500 and the other members each receive
$1,000.
Stock-Based Plans. The Company maintains the Johnson Outdoors Inc. 1994
Non-Employee Director Stock Ownership Plan (the "1994 Director Plan"), which was
approved by shareholders on January 27, 1994. The 1994 Director Plan provides
for up to 100,000 shares of Class A common stock to be issued to non-employee
directors in the following forms:
Stock Options. Upon first being elected or appointed as a director of
the Company during the existence of the 1994 Director Plan, a non-employee
director automatically receives an option to purchase 5,000 shares of Class
A common stock. The exercise price for such options is the fair market
value of a share of Class A common stock on the date of grant. Options have
a term of ten years and become fully exercisable one year after the date of
grant.
Restricted Stock Awards. In addition, each non-employee director of
the Company automatically receives 500 shares of Class A common stock on
the first business day after the Company's annual meeting of shareholders
in each year during the existence of the 1994 Director Plan. Shares of
Class A common stock granted to non-employee directors can not be sold or
otherwise transferred while the non-employee director remains a director of
the Company and thereafter the restrictions will lapse. However, a
non-employee director may transfer the shares to any trust or other estate
in which the director has a substantial interest or a trust of which the
director serves as trustee or to his or her spouse and certain other
related persons, provided the shares will continue to be subject to the
transfer restrictions described above.
On February 18, 2000, 500 shares of restricted stock were awarded to each
of the non-employee directors of the Company at that time (Messrs. Johnson,
Pyle, Lawton, Rupp and London).
5
<PAGE> 8
STOCK OWNERSHIP OF MANAGEMENT AND OTHERS
The following table sets forth certain information at November 1, 2000
regarding the beneficial ownership of each class of the Company's common stock
by each director, each person known by the Company to own beneficially more than
5% of either class of the Company's common stock, each executive officer named
in the Summary Compensation Table set forth below, and all directors and
executive officers as a group based upon information furnished by such persons.
Except as indicated in the footnotes, the persons listed have sole voting and
investment power over the shares beneficially owned.
<TABLE>
<CAPTION>
CLASS A COMMON STOCK(1) CLASS B COMMON STOCK(1)
------------------------------- -------------------------------
PERCENTAGE OF PERCENTAGE OF
NUMBER OF CLASS NUMBER OF CLASS
NAME AND ADDRESS SHARES OUTSTANDING SHARES OUTSTANDING
---------------- --------- ------------- --------- -------------
<S> <C> <C> <C> <C>
Samuel C. Johnson....................... 2,606,635(2)(3) 37.6% 1,062,330(2)(4) 86.9%
4041 North Main Street
Racine, Wisconsin 53402
Imogene P. Johnson...................... 33,268(4) * 1,037,330(4) 84.8
4041 North Main Street
Racine, Wisconsin 53402
JWA Consolidated, Inc. ................. 114,464(5) 1.7 1,037,330(4) 84.8
4041 North Main Street
Racine, Wisconsin 53402
Johnson Trust Co. ...................... 366,796(6) 5.3 142,616(6) 11.7
4041 North Main Street
Racine, Wisconsin 53402
Helen P. Johnson-Leipold................ 331,527(5)(7)(8) 4.8 1,056,722(4)(6)(8) 86.4
4041 North Main Street
Racine, Wisconsin 53402
Dimensional Fund Advisors Inc. ......... 556,900(9) 8.0(9) -- --
1299 Ocean Avenue
Santa Monica, CA 90401
Royce & Associates, Inc. ............... 551,020(10) 8.0(10) -- --
1414 Avenue of the Americas
New York, NY 10019
Carl G. Schmidt......................... 97,267(11) 1.4 -- --
Mamdouh Ashour.......................... 68,633(12) 1.0 -- --
Patrick J. O'Brien...................... 45,890(13) * -- --
Thomas F. Pyle, Jr. .................... 22,497(14) * -- --
Gregory E. Lawton....................... 6,500(15) * -- --
</TABLE>
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<PAGE> 9
<TABLE>
<CAPTION>
CLASS A COMMON STOCK(1) CLASS B COMMON STOCK(1)
------------------------------- -------------------------------
PERCENTAGE OF PERCENTAGE OF
NUMBER OF CLASS NUMBER OF CLASS
NAME AND ADDRESS SHARES OUTSTANDING SHARES OUTSTANDING
---------------- --------- ------------- --------- -------------
<S> <C> <C> <C> <C>
Glenn N. Rupp........................... 6,500(15) * -- --
Terry E. London......................... 5,500(15) * -- --
All directors and executive officers as
a group (8 persons)................... 3,093,682(5)(6)(8) 44.7 1,081,722(2)(4) 88.5
(16)(17) (6)(8)
</TABLE>
---------------
* The amount shown is less than 1% of the outstanding shares of such class.
(1) Shares of Class B common stock ("Class B Shares") are convertible on a
share-for-share basis into shares of Class A common stock ("Class A
Shares") at any time at the discretion of the holder thereof. As a result,
a holder of Class B Shares is deemed to beneficially own an equal number of
Class A Shares. However, in order to avoid overstatement of the aggregate
beneficial ownership of Class A Shares and Class B Shares, the Class A
Shares reported in the table do not include Class A Shares which may be
acquired upon the conversion of Class B Shares.
(2) Shares reported by Mr. Johnson include 98,000 Class A Shares and 1,037,330
Class B Shares over which Mr. Johnson may be deemed to share voting power
and investment power. The 98,000 Class A Shares are held of record by a
corporation controlled by Mr. Johnson through various trusts. The 1,037,330
Class B Shares are held of record by the Johnson Worldwide Associates, Inc.
Class B Common Stock Voting Trust ("Voting Trust") of which certain trusts
of which Mr. Johnson serves as sole trustee are Voting Trust unit holders.
Mr. Johnson owns 2,127,820 Class A Shares and 47,046 Class B Shares as sole
trustee of a trust for his benefit and reports beneficial ownership of the
remaining Class A Shares and Class B Shares indirectly as the sole trustee
of a trust for the benefit of Mr. Johnson, members of his family or related
entities (the "Johnson Family"), as the sole trustee of a shareholder of
certain corporations, or pursuant to options to acquire Class A Shares. Not
included in the number of Class A Shares or Class B Shares beneficially
owned by Mr. Johnson are Class A Shares or Class B Shares held by Mr.
Johnson's wife, Imogene P. Johnson, by family partnerships of which Mr.
Johnson is not a general partner, or does not directly or indirectly
control a general partner, by corporations in which all of the common stock
is beneficially owned by Mr. Johnson's adult children or by Johnson Trust
Company, Inc. ("JT"), except as otherwise noted.
(3) Includes options to acquire 6,316 Class A Shares, which options are
exercisable within 60 days.
(4) Shares reported by Mrs. Johnson include 1,037,330 Class B Shares directly
held by the Voting Trust and over which Mrs. Johnson has shared voting
power and shared investment power as sole trustee of the Voting Trust, and
all of which are also reported as beneficially owned by Mr. Johnson, Ms.
Johnson-Leipold and JWA Consolidated, Inc. as Voting Trust unit holders.
Mrs. Johnson reports the remaining shares as personally owned.
(5) The 114,464 Class A Shares are also reported as beneficially owned by Ms.
Johnson-Leipold as sole trustee of the Samuel C. Johnson Family Trust,
which controls JWA Consolidated, Inc.
(6) Includes 317,280 Class A Shares and 75,992 Class B Shares over which JT has
shared voting power and shared investment power, of which 19,392 Class B
Shares are also reported as beneficially owned by Ms. Johnson-Leipold. JT
reports beneficial ownership of the Class A Shares and Class B Shares
reflected in the table as sole trustee of various trusts principally for
the benefit of members of the Johnson Family. Mr. Johnson is directly or
indirectly the controlling shareholder of JT.
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<PAGE> 10
(7) Includes options to acquire 43,333 Class A Shares, which options are
exercisable within 60 days and 1,365.525 shares held by the Company's
401(k) Retirement and Savings Plan, over which the reporting person has
sole voting power.
(8) Includes 127,024 Class A Shares and 1,056,722 Class B Shares over which Ms.
Johnson-Leipold has shared voting power and shared investment power, all of
which are reported as beneficially owned by JT. Ms. Johnson-Leipold
beneficially owns such Class A Shares and Class B Shares indirectly as the
settlor and beneficiary of a trust and through such trust as a general
partner of certain limited partnerships controlled by the Johnson Family
and as a controlling shareholder, with trusts for the benefit of Mr.
Johnson and his adult children, of certain corporations.
(9) The information is based on a report on Schedule 13G, dated December 31,
1999, filed by Dimensional Fund Advisors Inc., a registered investment
advisor ("Dimensional") with the Securities and Exchange Commission.
Dimensional reported sole voting and sole dispositive power with respect to
all of the reported shares. Dimensional disclaims beneficial ownership of
all of the reported shares, which are owned by advisory clients of
Dimensional.
(10) The information is based on a report on Schedule 13G, dated December 31,
1999, filed by Royce & Associates, Inc. ("Royce") and Charles M. Royce with
the Securities and Exchange Commission. Mr. Royce may be deemed to be a
controlling person of Royce and as such may be deemed to beneficially own
the shares held by Royce. Royce reported sole voting and sole dispositive
power with respect to all of the reported shares.
(11) Includes options to acquire 87,000 Class A Shares, which options are
exercisable within 60 days, and 1,266.718 shares held by the Company's
401(k) Retirement and Savings Plan, over which the reporting person has
sole voting power.
(12) Includes options to acquire 54,333 Class A Shares, which options are
exercisable within 60 days.
(13) Includes options to acquire 40,666 Class A Shares, which options are
exercisable within 60 days, and 973.79 shares held by the Company's 401(k)
Retirement and Savings Plan, over which the reporting person has sole
voting power.
(14) Includes options to acquire 16,316 Class A Shares, which options are
exercisable within 60 days.
(15) Includes options to acquire 5,000 Class A Shares, which options are
exercisable within 60 days.
(16) Includes options to acquire 175,964 Class A Shares for all officers and
directors as a group, which options are exercisable within 60 days.
(17) Excludes shares held by Mr. Schmidt whose resignation as Senior Vice
President and Chief Financial Officer became effective September 30, 2000.
At November 1, 2000, the Johnson Family beneficially owned 3,393,647 Class
A Shares, or approximately 49.0% of the outstanding Class A Shares, and
1,141,722 Class B Shares, or approximately 93.4% of the outstanding Class B
Shares.
8
<PAGE> 11
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors is responsible for all
compensation and benefits provided to the Company's Chief Executive Officer,
other executive officers and key employees, except for equity-based
compensation. All equity-based compensation decisions are made by the Stock
Committee of the Board of Directors, which is comprised of the members of the
Compensation Committee. Set forth below is a report explaining the rationale
underlying fundamental executive compensation decisions affecting the Company's
executive officers, including the executive officers named in the Summary
Compensation Table (the "Named Executive Officers").
OVERALL COMPENSATION PHILOSOPHY
The Company's program is designed to align compensation with Company
performance, business strategy, Company values and management initiatives. The
Company's overall compensation objectives will provide a competitive total
compensation program designed to attract and retain high quality individuals and
maintain a performance oriented culture that fosters increased shareholder
value. The compensation policy is as follows:
- Base salaries will be targeted at the competitive average, based on a
review of the appropriate labor markets.
- Incentive plans will be targeted above the competitive average with no
cap on potential and will be widely used so that employees participate
based on relevant Company, team and individual performance.
- All compensation programs will be designed to add shareholder value.
The Company has developed an overall compensation strategy and specific
compensation plans that tie a significant portion of executive compensation to
the Company's success in meeting specified financial goals and the executive's
success in meeting specific performance goals. As an executive's level of
responsibility increases, a greater portion of total compensation is based on
performance-based incentive compensation and less on salary and employee
benefits, creating the potential for greater variability in the individual's
compensation level from year to year. The mix, level and structure of
performance-based incentive elements reflect market industry practices as well
as the executive's role and relative impact on business results.
The Compensation Committee continually monitors the operation of the
Company's executive compensation program. This monitoring includes a biannual
report from independent compensation consultants assessing the effectiveness of
the Company's compensation program by comparing the Company's executive
compensation to a group of public corporations in the recreation and sporting
goods industry and certain leading manufacturing companies located in Wisconsin
(the "Comparator Group"). The Comparator Group used for compensation analysis
includes, but is not limited to, companies in the peer group established to
compare shareholder returns. The Compensation Committee reviews the selection of
companies used for this analysis and believes that these companies fairly
represent the Company's competitors for executive talent.
The Compensation Committee determines the compensation of the Chief
Executive Officer and sets policies for, reviews and approves the
recommendations of management (subject to such adjustments as may be deemed
appropriate by the Committee) with respect to the compensation awarded to other
executive officers and other key employees (including the other Named Executive
Officers).
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<PAGE> 12
The key elements of the Company's executive compensation program consist of
base salary, annual bonus and long-term stock incentives. Senior executive
compensation packages are increasingly weighted toward programs contingent upon
the Company's performance. As a result, actual compensation levels of senior
executives in any particular year may vary within the range of compensation
levels of the competitive marketplace based on the Company's actual performance
and its prior year's financial results. Although the Compensation Committee
believes strongly in offering compensation opportunities competitive with those
of comparable members in the Company's industry, the most important
considerations in setting annual compensation are Company performance and
individual contributions. A general description of the elements of the Company's
compensation package, including the basis for the compensation awarded to the
Company's Chief Executive Officer for 2000, follows.
BASE SALARY
Base salaries are initially determined by evaluating the responsibilities
of the position, the experience of the individual and the salaries for
comparable positions in the competitive marketplace. Base salary levels for the
Company's executive officers are generally positioned to be competitive with
comparable positions in the Comparator Group. The Compensation Committee
annually reviews each executive officer's base salary. In determining salary
adjustments for executive officers, the Committee considers various factors,
including the individual's performance and contribution, the average percentage
pay level for similar positions and the Company's performance. In the case of
executive officers with responsibility for a particular business unit, such
unit's financial results are also considered. The Compensation Committee, where
appropriate, also considers nonfinancial performance measures such as
improvements in product quality, manufacturing efficiency gains and the
enhancement of relations with Company customers and employees. The Compensation
Committee exercises discretion in setting base salaries within the guidelines
discussed above.
Effective January 1, 2000, Ms. Johnson-Leipold's annualized base salary was
increased from $375,000 to $397,500 to reflect the Compensation Committee's
assessment of the factors listed above.
BONUS PROGRAM
The Compensation Committee recognizes the importance of aligning executive
compensation with the interests of the shareholders and believes that
improvement in economic value provides an excellent measure of shareholder
returns. Accordingly, the Board of Directors adopted the Johnson Outdoors
Economic Value Added Bonus Plan ("Plan") in fiscal 1997. The Plan was enhanced
in fiscal 2000 by apportioning a percentage of target bonus to individual
objectives.
The use of individual objectives allows for the establishment of goals that
each Plan participant can best impact, which include, but are not limited to:
profitability, sales growth, market share growth, organizational capacity or new
item introductions. Against target, individual objective payouts range from
0-200%, and, in all cases, the greater percentage of bonus targets remained
Economic Value Added ("EVA") based.
The Company's executive officers are included in the Plan. Target bonuses
ranging from 40% to 100% of an executive's base salary are established by the
Compensation Committee for each executive officer at the beginning of the year.
Target award opportunities are competitive with industry practices. The Plan
includes approximately 100 participants.
10
<PAGE> 13
For the EVA portion, the Plan provides for bonus awards based solely on
improvements in the EVA of the Company. EVA(R)(1) is a measure of after tax
operating profit after the deduction of all costs, including the cost of the
Company's capital. EVA is based on three key concepts: (1) a target bonus, (2)
expected improvement in EVA, and (3) a bonus bank. The EVA bonus eligible to be
earned is equal to the sum of the target bonus plus (or minus) a calculated
amount based on the improvement (or deterioration) from the targeted amount of
EVA.
The expected improvement in EVA is used to determine the targeted level of
EVA and is determined by an objective review of the past performance of the
Company, taking into account the goal of achievement of a substantial
improvement in EVA over a multiple year period. Such review is conducted by
independent compensation consultants expert in the concepts of EVA. The annual
amount of expected improvement in EVA is fixed. This approach results in the
need to achieve increasingly higher EVA levels each year to maintain the same
level of incentive compensation. To ensure that the EVA element provides strong
incentives for management to annually increase shareholder value and does not
reward poor performance by reducing performance standards or penalize superior
performance by raising performance standards, the Compensation Committee allowed
no recalibration of the expected EVA improvement for the three fiscal years
1997 -- 1999. Due to the significant changes in the Company's business since EVA
was adopted, such recalibration was performed for fiscal year 2000.
The bonus eligible to be earned is credited to a bonus bank ("Bank"). The
maximum amount that may be withdrawn from the Bank in any year is equal to the
amount of the target bonus for that year plus one third of the balance of the
Bank in excess of the target bonus. Accordingly, the balance in the Bank is "at
risk." No bonus is paid when the balance in the Bank is negative. Negative Bank
balances are carried forward and are offset against future bonuses earned. There
is no cap on the amount of bonus that can be earned for achievement of superior
levels of EVA improvement, nor is there a floor on the amount of negative bonus
credited to the Bank if EVA declines. Bank balances vest only in the event of
death, retirement or involuntary termination. The concept of a Bank is utilized
to encourage long-term thinking with regard to the operation of the Company. As
the Company is adopting a different measure for increasing shareholder value,
the banking element of EVA ends in fiscal year 2000.
The Compensation Committee retains the final authority to approve
individual bonuses and may, at its sole discretion, reduce or eliminate bonuses
determined under the Plan formula. In 2000, the Compensation Committee approved
a bonus of $372,929 for Ms. Johnson-Leipold.
LONG-TERM STOCK INCENTIVES
Long-term stock incentives are designed to encourage and create significant
ownership of Company stock by key executives, thereby promoting a close identity
of interests between the Company's management and its shareholders. Another
objective of long-term stock incentives is to encourage and reward executives
for long-term strategic management and the enhancement of shareholder value. The
Company's equity-based award practices are designed to be competitive with those
offered by other recreation and sporting goods companies and other leading
manufacturing companies in Wisconsin. To this end, the Stock Committee considers
recommendations from the Company's independent compensation consultants in
determining the level of equity-based awards. The Company currently grants two
forms of long-term stock incentives: stock options and, on a more selective
basis, restricted stock.
---------------
(1) EVA is a registered trademark of Stern Stewart & Co.
11
<PAGE> 14
Stock Options. Under the Company's 2000 Long-Term Stock Incentive Plan,
1994 Long-Term Stock Incentive Plan and the 1986 Stock Option Plan, nonqualified
stock options have been the primary form of long-term incentive compensation.
Options typically are granted annually, with the size of grants varying based on
several factors, including the executive's level of responsibility and past
contributions to the Company as well as the practices of peer companies.
Consideration is also given to a person's potential for future responsibility
and promotion. The number of shares covered by grants generally reflects
competitive industry practices. Stock options are granted with an exercise price
equal to the market price of the common stock on the date of grant. Stock
options granted in 2000 vest ratably over a three year period. Vesting schedules
are designed to encourage the creation of shareholder value over the long-term
since the full benefit of the compensation package cannot be realized unless
stock price appreciation occurs over a number of years.
Stock option grants in 2000 reflect the considerations discussed above. On
December 13, 1999, Ms. Johnson-Leipold received options to purchase 30,000
shares at an exercise price of $7.625 per share.
Restricted Stock. The Company has a Restricted Stock Plan, which was
adopted in 1986. The 2000 Long-Term Stock Incentive Plan and the 1994 Long-Term
Stock Incentive Plan also allow for the issuance of restricted stock. Under
these plans, grants are made on a highly selective basis to executive officers.
From time to time, current executives may receive grants of restricted stock to
recognize corporate successes and individual contributions. The Stock Committee
decides appropriate award amounts based on the circumstances of the situation
(for example, in the case of a new hire, the level of the position to be filled
and the qualifications of the executive sought to fill that role).
COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162(M)
It is anticipated that all 2000 compensation to executives will be fully
deductible under Section 162(m) of the Internal Revenue Code and therefore the
Compensation Committee determined that a policy with respect to qualifying
compensation paid to executive officers for deductibility is not necessary.
COMPENSATION COMMITTEE
Thomas F. Pyle, Jr. (Chairman)
Glenn N. Rupp
Terry E. London
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<PAGE> 15
SUMMARY COMPENSATION INFORMATION
The following table sets forth certain information concerning compensation
paid for the last three fiscal years to the Chief Executive Officer and each of
the Company's executive officers.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
------------------------
ANNUAL COMPENSATION SECURITIES
----------------------------------------------- RESTRICTED UNDERLYING
OTHER ANNUAL STOCK STOCK ALL OTHER
NAME AND PRINCIPAL POSITION(S) YEAR SALARY BONUS(6) COMPENSATION(7) AWARDS(8) OPTIONS COMPENSATION(9)
------------------------------ ---- ------ -------- --------------- ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Helen P. Johnson-Leipold.... 2000 $391,875(5) $372,900 $ -- --(5) 30,000 $ 53,490
Chairman and Chief 1999 199,000(5) 130,200 -- $132,400(5) 85,000 25,800
Executive Officer(1) 1998 --(5) -- -- --(5) -- --
Patrick J. O'Brien.......... 2000 290,500 248,900 -- -- 25,000 40,050
President and Chief 1999 132,600 73,700 -- 24,600 97,000 16,300
Operating Officer(2) 1998 -- -- -- -- -- --
Carl G. Schmidt............. 2000 238,200 183,600 -- -- 10,000 300,380
Senior Vice President and 1999 230,300 105,400 -- -- 10,000 28,700
Chief Financial Officer, 1998 212,300 78,400 -- -- 15,000 23,700
Secretary and Treasurer(3)
Mamdouh Ashour.............. 2000 261,625 147,300 71,200 -- 8,500 209,410
Group Vice President 1999 257,500 -- 48,600 -- 7,500 143,900
and President -- 1998 250,000 39,300 53,800 -- 15,000 55,700
Worldwide Diving(4)
</TABLE>
FOOTNOTES TO SUMMARY COMPENSATION TABLE
(1) Ms. Johnson-Leipold has been Chairman and Chief Executive Officer since
March 1999.
(2) Mr. O'Brien has been President and Chief Operating Officer since April 1999.
(3) Mr. Schmidt's resignation as Senior Vice President and Chief Financial
Officer, Secretary and Treasurer became effective September 30, 2000.
(4) Mr. Ashour has been a Group Vice President of the Company since October 1997
and President -- Worldwide Diving since August 1996. From 1994 to August
1996, he served as President of Scubapro Europe.
(5) Does not include restricted stock awards or amounts paid for services as a
director of the Company during the applicable year. No such awards were
granted or services paid while Ms. Johnson-Leipold was an employee of the
Company.
(6) The amounts in the table for the year ended September 29, 2000 consist of
amounts accrued under the bonus program.
(7) The amounts in the table consist of reimbursements for the payment of U.S.
taxes by Mr. Ashour. The amount of the perquisites and other personal
benefits, securities or property paid to each of the Named Executive
Officers is less than the lesser of $50,000 or 10% of the total annual
salary and bonus paid to such Named Executive Officer.
(8) The amounts in the table reflect the market value on the date of grant (net
of any consideration paid by the Named Executive Officer) of restricted
shares of Class A common stock awarded under the 1994
13
<PAGE> 16
Long-Term Stock Incentive Plan. The number of restricted (unvested) shares
held by the Named Executive Officers and the market value of such shares
(net of any consideration paid by the Named Executive Officers) as of
September 29, 2000 were as follows: Ms. Johnson-Leipold, 10,000 shares
($68,880) and Mr. O'Brien 2,000 shares ($13,800). Ms. Johnson-Leipold
received an award of 15,000 shares of restricted stock on March 22, 1999.
Mr. O'Brien received an award of 3,000 shares of restricted stock on April
12, 1999. One-third of the shares awarded to Ms. Johnson-Leipold and Mr.
O'Brien vest on each successive anniversary of the date of award. Holders of
restricted shares are entitled to receive dividends, if any, on such shares.
(9) The amounts in the table for the year ended September 29, 2000 consist of
the following:
(a) Amounts to be credited for qualified retirement contributions are
$12,800 for Ms. Johnson-Leipold, $12,800 for Mr. O'Brien, $12,800 for
Mr. Schmidt and $12,800 for Mr. Ashour.
(b) Company matching contributions to the executives' 401(k) plan accounts
during the year ended September 29, 2000 of $5,250 for Ms.
Johnson-Leipold, $6,750 for Mr. O'Brien, $5,250 for Mr. Schmidt and
$5,250 for Mr. Ashour.
(c) Company contributions to the executives' non-qualified plan accounts
during the year ended September 29, 2000 of $35,444 for Ms.
Johnson-Leipold, $20,500 for Mr. O'Brien, $12,900 for Mr. Schmidt and
$14,350 for Mr. Ashour.
(d) $177,012 paid to Mr. Ashour for expatriate cost of living and income
tax allowances.
(e) $239,900 to be paid to Mr. Schmidt under his separation agreement. See
"Agreements with Named Executive Officers."
(f) $29,526 paid to Mr. Schmidt during fiscal year ended September 29, 2000
for earned and unused and accrued vacation.
14
<PAGE> 17
STOCK-BASED COMPENSATION
The following table provides details regarding stock options granted to the
Named Executive Officers in fiscal 2000 under the Johnson Outdoors Inc. 1994
Long-Term Stock Incentive Plan and the Johnson Outdoors Inc. 2000 Long-Term
Stock Incentive Plan. In addition, this table shows hypothetical gains that
would exist for the respective options granted to the Named Executive Officers.
These gains are based on assumed rates of annual compound stock price
appreciation of 5% and 10% from the date the options were granted over the full
option term.
OPTION GRANTS IN FISCAL 2000
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUES
NUMBER OF AT ASSUMED ANNUAL RATES
SECURITIES % OF TOTAL OF STOCK PRICE APPRECIATION
UNDERLYING OPTIONS GRANTED EXERCISE OR FOR OPTION TERM
OPTIONS TO EMPLOYEES IN BASE PRICE EXPIRATION ---------------------------
NAME GRANTED FISCAL YEAR ($/SHARE) DATE 5% 10%
---- ---------- --------------- ----------- ---------- -- ---
<S> <C> <C> <C> <C> <C> <C>
Helen P. Johnson-Leipold... 30,000(1) 11% $7.625 12/13/09 $143,860 $364,569
Patrick J. O'Brien......... 25,000(1) 9 7.625 12/13/09 119,883 303,807
Carl G. Schmidt............ 10,000(2) 4 7.625 12/13/09 47,953 121,523
Mamdouh Ashour............. 8,500(1) 3 7.625 12/13/09 40,760 103,294
</TABLE>
---------------
(1) One-third of the options vest and become exercisable each successive year
after grant, commencing December 13, 2000.
(2) One-third of the options vest and become exercisable each successive year
after grant, commencing December 13, 2000. All grants will be cancelled
October 1, 2001.
The following table shows stock option exercises by the Named Executive
Officers during fiscal 2000. In addition, this table includes the number of
shares remaining covered by both "exercisable" (i.e., vested) and
"unexercisable" (i.e., unvested) stock options as of September 29, 2000. Also
reported are the values for "in-the-money" options which represent the positive
spread between the exercise price of any such existing stock options and the
September 29, 2000 closing price of the Class A common stock of $6.938.
AGGREGATE OPTION EXERCISES IN FISCAL 2000 AND
FISCAL 2000 YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT 9/29/00 OPTIONS AT 9/29/00
ACQUIRED VALUE ---------------------------- ----------------------------
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Helen P.
Johnson-Leipold........ -- $-- 33,333 86,667 $0 $0
Patrick J. O'Brien....... -- -- 32,333 89,667 0 0
Carl G. Schmidt.......... -- -- 75,333 21,667 0 0
Mamdouh Ashour........... -- -- 44,000 18,500 0 0
</TABLE>
15
<PAGE> 18
TOTAL SHAREHOLDER RETURN
The graph below compares on a cumulative basis the yearly percentage change
since September 29, 1995 in (a) the total return to shareholders on the Class A
common stock with (b) the total return on the Nasdaq Stock Market-U.S. Index;
(c) the total return on the Russell 2000 Index and (d) the total return on a
self-constructed peer group index. The peer group consists of the Company, K2,
Inc., Brunswick Corporation and Huffy Corporation. The graph assumes $100 was
invested on September 29, 1995 in Class A common stock, the Nasdaq Stock
Market-U.S. Index, the Russell 2000 Index and the peer group index. The Coleman
Company, Inc., which was included in the peer group in the previous year, is now
a wholly owned subsidiary of Sunbeam Corporation.
[GRAPH]
<TABLE>
<CAPTION>
9/29/95 9/27/96 10/3/97 10/2/98 10/1/99 9/29/00
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Johnson Outdoors....................... $100.00 $ 59.38 $ 70.83 $ 35.42 $ 37.24 $ 28.91
Nasdaq Market Index (U.S.)............. 100.00 119.03 165.95 157.74 269.50 358.89
Russell 2000 Index..................... 100.00 112.82 152.57 117.44 144.01 179.28
Peer Group............................. 100.00 124.75 177.39 78.91 118.82 94.21
</TABLE>
AGREEMENTS WITH NAMED EXECUTIVE OFFICERS
In June 2000, the Company entered into a separation agreement with Mr.
Schmidt, the Company's former Senior Vice President and Chief Financial Officer.
Pursuant to the terms of this agreement, Mr. Schmidt resigned from all positions
with the Company and its subsidiaries as of September 30, 2000. The Company
agreed to continue Mr. Schmidt's last base salary of $239,900 until at least
September 30, 2001 and salary and certain benefits until the earlier of
commencement of new employment or December 31, 2001. Under this agreement, Mr.
Schmidt agreed not to be employed by, or affiliated with, certain competitors of
the Company during the period beginning on his resignation date and ending
September 30, 2001 (the "Restricted Period") and to abide by the terms of the
Company's Management Employee Agreement. Mr. Schmidt also agreed to a
confidentiality arrangement during the Restricted Period and for two years
thereafter and released
16
<PAGE> 19
the Company from any and all liability. In the event that Mr. Schmidt violates
the terms of the agreement, the Company is entitled to withhold and terminate
all payments and benefits provided under the agreement and recover from Mr.
Schmidt all payments and benefits previously provided to him thereunder.
CERTAIN TRANSACTIONS
The Company purchases certain services from S. C. Johnson & Son, Inc. and
other organizations controlled by Samuel C. Johnson, a director of the Company,
and the Johnson Family (including Helen P. Johnson-Leipold, Chairman and Chief
Executive Officer of the Company) including consulting and administrative
services. The Company believes that the amounts paid to these organizations are
no greater than the fair market value of the services. The total amount incurred
by the Company for the foregoing services during the year ended September 29,
2000 was approximately $542,000.
INDEPENDENT AUDITORS
KPMG LLP ("KPMG") served as the independent auditors for the purpose of
auditing the consolidated financial statements of the Company for the year ended
September 29, 2000. Representatives of KPMG will be present at the Annual
Meeting and will have an opportunity to make a statement if they so desire and
to respond to appropriate questions. The Board of Directors will not choose
independent public accountants for the purpose of auditing the consolidated
financial statements of the Company for the year ending September 28, 2001 until
after the 2001 Annual Meeting of Shareholders.
SHAREHOLDER PROPOSALS
All shareholder proposals pursuant to Rule 14a-8 under the Securities
Exchange Act of 1934, as amended ("Rule 14a-8"), for presentation at the 2002
Annual Meeting of Shareholders must be received at the offices of the Company,
1326 Willow Road, Sturtevant, Wisconsin 53177 by August 30, 2001 for inclusion
in the proxy statement and form of proxy relating to the meeting. In addition, a
shareholder who otherwise intends to present business at the 2002 Annual Meeting
of Shareholders must comply with the requirements set forth in the Company's
Bylaws. Among other things, to bring business before an annual meeting, a
shareholder must give written notice thereof, complying with the Bylaws, to the
Secretary of the Company not more than 90 days prior to the date of such annual
meeting and not less than the close of business on the later of (i) the 60th day
prior to such annual meeting and (ii) the 10th day following the day on which
public announcement of the date of such meeting is first made. Under the Bylaws,
if the Company does not receive notice of a shareholder proposal submitted
otherwise than pursuant to Rule 14a-8 (i.e., proposals shareholders intend to
present at the 2002 Annual Meeting of Shareholders but do not intend to have
included in the Company's proxy statement and form of proxy for such meeting)
prior to the close of business on November 27, 2001 (assuming a January 25, 2002
meeting date), then the notice will be considered untimely and the Company will
not be required to present such proposal at the 2002 Annual Meeting of
Shareholders. If the Board of Directors chooses to present such proposal at the
2002 Annual Meeting of Shareholders, then the persons named in proxies solicited
by the Board of Directors for the 2002 Annual Meeting of Shareholders may
exercise discretionary voting power with respect to such proposal. The 2002
Annual Meeting of Shareholders is tentatively scheduled to be held on January
25, 2002.
17
<PAGE> 20
The following proposal has been submitted for inclusion in this Proxy
Statement:
Mr. William Steiner, 4 Radcliff Drive, Great Neck, New York 11024, who
states that he is the beneficial owner of 2,775 shares of Company stock, has
notified the Company that he intends to present a resolution for action by
shareholders at the Annual Meeting. The text of the resolution and supporting
statement, as presented to the Company, is as follows:
MAXIMIZE VALUE RESOLUTION
Resolved that the shareholders of Johnson Outdoors Inc. urge the Johnson
Outdoors Inc. Board of Directors to arrange for the prompt sale of Johnson
Outdoors Inc. to the highest bidder.
PROPONENT'S SUPPORTING STATEMENT
The purpose of the Maximize Value Resolution is to give all Johnson
Outdoors Inc. shareholders the opportunity to send a message to the Johnson
Outdoors Inc. Board that they support the prompt sale of Johnson Outdoors Inc.
to the highest bidder. A strong and or majority vote by the shareholders would
indicate to the board the displeasure felt by the shareholders of the
shareholder returns over many years and the drastic action that should be taken.
Even if it is approved by the majority of the Johnson Outdoors Inc. shares
represented and entitled to vote at the annual meeting, the Maximize Value
Resolution will not be binding on the Johnson Outdoors Inc. Board. The proponent
however believes that if this resolution receives substantial support from the
shareholders, the board may choose to carry out the request set forth in the
resolution.
The prompt auction of Johnson Outdoors Inc. should be accomplished by any
appropriate process the board chooses to adopt including a sale to the highest
bidder whether in cash, stock, or a combination of both. It is expected that the
board will uphold its fiduciary duties to the utmost during the process.
The proponent further believes that if the resolution is adopted, the
management and the board will interpret such adoption as a message from the
company's stockholders that it is no longer acceptable for the board to continue
with its current management plan and strategies.
I urge your support, vote for this resolution.
STATEMENT OF THE BOARD OF DIRECTORS AGAINST THE PROPOSAL
The Board of Directors believes that the proposal described above would not
be in the best interests of the Company or its shareholders and recommends a
vote AGAINST the proposal.
The Board of Directors reviews on a regular basis strategic alternatives
and opportunities available to it and remains committed to growing and improving
shareholder value. Over the last several years, the Board and the Company's
management have worked to develop a success model to best equip the Company for
consistent long-term growth in shareholder value. As a result of these efforts,
the Company had double digit increases in sales and operating profit as well as
a strong gain in earnings per share in fiscal 2000. The Company and the Board
believe that the continued focus on implementing its success model will maximize
shareholder value.
The Board of Directors regularly seeks to enhance shareholder value through
internal growth, restructuring, acquisitions and other strategic business plans.
During the past two years, the Company has implemented a number of initiatives
and/or completed transactions designed to achieve corporate growth and increased
18
<PAGE> 21
profitability and, thereby, to enhance shareholder value. These initiatives
and/or transactions include, among other things, the following:
- In March 1999, the Board of Directors selected Helen Johnson-Leipold as
Chairman and Chief Executive Officer and in April 1999 selected Patrick
O'Brien as President and Chief Operating Officer. One of their first
actions was to conduct a strategic review of all of the Company's
businesses and develop a success model. The success model developed
encompasses four drivers considered essential to long-term
growth -- Portfolio Management (play in the businesses only where the
Company can win), Network Model (operate as a network of specialized
companies that maintain their independent, creative spirit while sharing
best practices and leveraging synergies), Expanding Markets (broaden the
Company's consumer base by creating a higher level of demand) and
Innovation (the lifeblood of the Company and the key component to the
other drivers).
- In March 2000, the Company sold its Fishing business because it did not
fit in the Company's long-term success model.
- In April 2000, the Company acquired Pacific Kayak, a manufacturer of
sit-on-top and sea touring kayaks.
- In fiscal 1999, the Company acquired True North Paddle & Necky Kayaks, a
manufacturer and marketer of high quality Necky sea touring and
whitewater kayaks; Escape Sailboat Company, a manufacturer and marketer
of Escape recreational sailboats; and Extrasport, a manufacturer and
marketer of Extrasport and Swiftwater personal flotation devices.
The Board of Directors and the Company's management believe that the
Company is in position to continue to move forward and realize continued
success. The Board believes that it would be imprudent and not in the best
interests of the Company and its shareholders if the Company's strategic
business plans are abandoned now when they are staring to achieve results.
For the foregoing reasons, the Board of Directors recommends a vote AGAINST
this proposal.
VOTE REQUIRED
The affirmative vote of a majority of the votes represented and voted at
the Annual Meeting (assuming a quorum is present) is required to approve the
shareholder proposal described above. Any shares not voted at the Annual Meeting
(whether by broker non-votes or otherwise, except abstentions), will have no
impact on the vote. Shares as to which holders abstain from voting will be
treated as votes against the proposal. Shares represented at the Annual Meeting
by executed but unmarked proxies will be voted against approval of the proposal.
The proposal is non-binding on the Board of Directors, even if it is approved by
the shareholders.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers, directors, and more than 10% shareholders to file with the
Securities and Exchange Commission reports on prescribed forms of their
ownership and changes in ownership of Company stock and furnish copies of such
forms to the Company. Based solely on a review of the copies of such forms
furnished to the Company, or written representations that no Form 5 was required
to be filed, the Company believes that during the year ended September 29, 2000,
all reports required by Section 16(a) to be filed by the Company's officers,
directors and more than 10% shareholders were filed on a timely basis, except
that the initial statement of
19
<PAGE> 22
beneficial ownership of securities on Form 3 for Scott M. Vos, Director of
Financial Reporting, was inadvertently filed late.
OTHER MATTERS
The Company has filed an Annual Report on Form 10-K with the Securities and
Exchange Commission for the year ended September 29, 2000. This Form 10-K will
be bound with the Company's 2000 Annual Report to Shareholders and mailed to
each person who is a record or beneficial holder of shares of Class A common
stock or Class B common stock on the record date for the Annual Meeting. Other
requests for copies of the Form 10-K should be addressed to the Secretary,
Johnson Outdoors Inc., 1326 Willow Road, Sturtevant, Wisconsin 53177 or via the
internet to: [email protected].
The cost of soliciting proxies will be borne by the Company. The Company
expects to solicit proxies primarily by mail. Proxies may also be solicited in
person or by telephone by certain officers and employees of the Company. It is
not anticipated that anyone will be specially engaged to solicit proxies or that
special compensation will be paid for that purpose. The Company will reimburse
brokers and other nominees for their reasonable expenses in communicating with
the persons for whom they hold stock of the Company.
Neither the Board of Directors nor management intends to bring before the
Annual Meeting any matters other than those referred to in the Notice of Annual
Meeting and this Proxy Statement. In the event that any other matters shall
properly come before the Annual Meeting, it is the intention of the persons
named in the proxy forms to vote the shares represented by each such proxy in
accordance with their judgment on such matters.
By Order of the Board of Directors
/s/ HELEN JOHNSON-LEIPOLD
HELEN JOHNSON-LEIPOLD
Chairman and Chief Executive
Officer
Audit Committee Charter is attached as Appendix A hereto.
20
<PAGE> 23
APPENDIX A
JOHNSON OUTDOORS INC.
CHARTER OF THE
AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
I. PURPOSE
The primary function of the Audit Committee ("Committee") is to assist the
Board of Directors ("Board") in fulfilling its oversight responsibilities by
reviewing: the financial reports and other financial information provided by the
Company to any governmental body or the public; the Company's systems of
internal controls regarding finance, accounting, legal compliance and ethics
that management and the Board have established; and the Company's auditing,
accounting and financial reporting processes generally. Consistent with this
function, the Committee should encourage continuous improvement of, and should
foster adherence to, the Company's policies, procedures and practices at all
levels. The Committee's primary duties and responsibilities are to:
- Serve as an independent and objective party to monitor the Company's
financial reporting process and internal control system.
- Review and appraise the audit efforts of the Company's independent
auditors and internal auditors.(1)
- Provide an open avenue of communication among the independent auditors,
financial and senior management, the internal auditors, and the Board.
The Committee will primarily fulfill these responsibilities by carrying out
the activities enumerated in Section IV of this Charter.
II. COMPOSITION
The Committee shall be comprised of two or more directors as determined by
the Board, each of whom shall be independent directors(2), and free from any
relationship that, in the opinion of the Board, would interfere with the
exercise of his or her independent judgment as a member of the Committee. All
members of the Committee shall have a working familiarity with basic finance and
accounting practices, and at least one member of the Committee shall have past
employment experience in finance or accounting, requisite professional
certification in accounting or any other comparable experience or background
that results in the individual's financial sophistication, including being or
having been a chief executive officer, chief financial officer, or other senior
officer with financial oversight responsibilities. Committee members may enhance
their familiarity with finance and accounting by participating in educational
programs conducted by the Company or an outside consultant.
---------------
(1) At the present time, the Company does not have a formal internal audit
function. The Charter encompasses this function in contemplation of the
possible establishment of such function in the future.
(2) The membership of the Committee shall always be such that a majority of the
members of the Committee shall not be full-time employees of any Controlling
Shareholder, the Company or any of their respective subsidiaries.
21
<PAGE> 24
The members of the Committee shall be elected by the Board at the annual
organizational meeting of the Board or until their successors shall be duly
elected and qualified. Unless a Chairman is elected by the full Board, the
members of the Committee may designate a Chairman by majority vote of the full
Committee membership.
III. MEETINGS
The Committee shall meet at least two times annually, or more frequently as
circumstances dictate. As part of its job to foster open communication, the
Committee should meet at least annually with management, the director of the
internal auditors and the independent auditors in separate executive sessions to
discuss any matters that the Committee or each of these groups believe should be
discussed privately.
IV. RESPONSIBILITIES AND DUTIES
To fulfill its responsibilities and duties the Committee shall:
DOCUMENTS/REPORTS REVIEW
- Review and update this Charter periodically as conditions dictate.
- Review the Company's annual financial statements, Form 10-K and any
reports or other financial information submitted to any governmental
body, or the public, including any certification, report, opinion, or
review rendered by the independent auditors.
- Review the regular internal reports to management prepared by the
internal auditors and management's response.
- Review with financial management and the independent auditors quarterly
financial results to be included in the Form 10-Q prior to its filing and
prior to the public release of earnings. The Chairman of the Committee
may represent the entire Committee for purposes of this review.
INDEPENDENT AUDITORS
- Recommend to the Board of Directors the selection of a firm of
independent auditors to act as auditors of the Company, considering
independence and effectiveness and approve the fees and other
compensation to be paid to the independent auditors. On an annual basis,
the Committee should review and discuss with the auditors all significant
relationships the auditors have with the Company to determine the
auditors' independence.
- Review with the independent auditors, in advance, the scope of the annual
audit, including the scope of complementary internal audit activities.
- Review with the independent auditors the results of the annual audit.
- Review the performance of the independent auditors and approve any
proposed discharge of the independent auditors when circumstances
warrant.
- Periodically consult with the independent auditors out of the presence of
management about internal controls and the fullness and accuracy of the
Company's financial statements.
22
<PAGE> 25
FINANCIAL REPORTING PROCESSES
- In consultation with the independent auditors and the internal auditors,
review the integrity of the Company's financial reporting processes, both
internal and external.
- Consider the independent auditors' judgments about the quality and
appropriateness of the Company's accounting principles as applied in its
financial reporting.
- Consider and approve, if appropriate, major changes to the Company's
auditing and accounting principles and practices as suggested by the
independent auditors, management, or the internal auditors.
PROCESS IMPROVEMENT
- Establish regular and separate systems of reporting to the Committee by
each of management, the independent auditors and the internal auditors
regarding any significant judgments made in management's preparation of
the financial statements and the view of each as to appropriateness of
such judgments.
- Following completion of the annual audit, review separately with each of
management, the independent auditors and the internal auditors any
significant difficulties encountered during the course of the audit,
including any restrictions on the scope of work or access to required
information.
- Review any significant disagreement among management and the independent
auditors or the internal auditors in connection with the preparation of
the financial statements.
- Review with the independent auditors, the internal auditors and
management the extent to which changes or improvements in financial or
accounting practices, as approved by the Committee, have been
implemented.
ETHICAL AND LEGAL COMPLIANCE
- Establish, review and update periodically a code of ethical conduct
("Code")(3) and ensure that management has established a system to
enforce this Code.
- Review management's monitoring of the Company's compliance with the
Company's Code, and ensure that management has the proper review system
in place to ensure that Company's financial statements, reports and other
financial information disseminated to governmental organizations, and the
public satisfy legal requirements.
- Review transactions, if any, between the Company and the Controlling
Shareholder, or any of their respective subsidiaries, in accordance with
policies adopted by the Board.
- Review activities, organizational structure, and qualifications of the
internal audit department.
- Review, with the Company's counsel, legal compliance matters including
corporate securities trading policies.
---------------
(3) Johnson Outdoors Policy Guidelines on Standards of Business Conduct and
Legal Compliance dated January 1, 1995 currently serves as the Code.
23
<PAGE> 26
- Review, with the Company's counsel, any legal matter that could have a
significant impact on the Company's financial statements.
OTHER
Perform any other activities consistent with this Charter, the Company's
By-laws and governing law, as the Committee or the Board deems necessary or
appropriate.
24
<PAGE> 27
CLASS A COMMON STOCK PROXY
JOHNSON OUTDOORS INC.
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD JANUARY 31, 2001
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
JOHNSON OUTDOORS INC.
The undersigned constitutes and appoints HELEN P. JOHNSON-LEIPOLD and PATRICK J.
O'BRIEN, and each of them, each with full power to act without the other, and
each with full power of substitution, the true and lawful proxies of the
undersigned, to represent and vote, as designated below, all shares of Class A
Common Stock of Johnson Outdoors Inc. which the undersigned is entitled to vote
at the Annual Meeting of Shareholders of such corporation to be held at its
headquarters, located at 1326 Willow Road, Sturtevant, Wisconsin, on Wednesday,
January 31, 2001, at 10:00 a.m. local time, and at any adjournment or
postponement thereof:
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEM 1 AND A VOTE AGAINST ITEM 2.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE ELECTION OF THE NOMINEES SPECIFIED IN ITEM 1 AND AGAINST ITEM 2.
The undersigned acknowledges receipt of the Notice of said Annual Meeting and
the accompanying Proxy Statement and Annual Report.
DETACH BELOW AND RETURN USING THE ENVELOPE PROVIDED
JOHNSON OUTDOORS INC. 2001 ANNUAL MEETING
<TABLE>
<CAPTION>
<S> <C> <C>
1. ELECTION OF DIRECTORS [ ] FOR all nominees [ ] WITHHOLD AUTHORITY to
By Holders of Class A Common Stock listed to the left vote for all nominees
1- GLENN N. RUPP 2 -TERRY E. LONDON (except as listed to the left.
specified below).
(Instructions: To withhold authority to vote for any individual nominee,
write the number(s) of the nominee(s) in the box provided to the right.)
2. Approval of the shareholder proposal regarding the sale of the Company. [ ] FOR [ ] AGAINST [ ] ABSTAIN
</TABLE>
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the Meeting.
Check appropriate box Date: ________________ NO. OF SHARES
Indicate changes below:
Address Change? [ ] Name Change? [ ]
SIGNATURE(S) IN BOX
Note: Please sign exactly as your
name appears on your stock
certificate. Joint owners should
each sign personally. A corporation
should sign full corporate name by
duly authorized officers and affix
corporate seal, if any. When
signing as attorney, executor,
administrator, trustee or guardian,
give full title as such.
<PAGE> 28
CLASS B COMMON STOCK PROXY
JOHNSON OUTDOORS INC.
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD JANUARY 31, 2001
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
JOHNSON OUTDOORS INC.
The undersigned constitutes and appoints HELEN P. JOHNSON-LEIPOLD and PATRICK J.
O'BRIEN, and each of them, each with full power to act without the other, and
each with full power of substitution, the true and lawful proxies of the
undersigned, to represent and vote, as designated below, all shares of Class B
Common Stock of Johnson Outdoors Inc. which the undersigned is entitled to vote
at the Annual Meeting of Shareholders of such corporation to be held at its
headquarters, located at 1326 Willow Road, Sturtevant, Wisconsin, on Wednesday,
January 31, 2001, at 10:00 a.m. local time, and at any adjournment or
postponement thereof:
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEM 1 AND A VOTE AGAINST ITEM 2.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE ELECTION OF THE NOMINEES SPECIFIED IN ITEM 1 AND AGAINST ITEM 2.
The undersigned acknowledges receipt of the Notice of said Annual Meeting and
the accompanying Proxy Statement and Annual Report.
DETACH BELOW AND RETURN USING THE ENVELOPE PROVIDED
JOHNSON OUTDOORS INC. 2001 ANNUAL MEETING
<TABLE>
<CAPTION>
<S> <C> <C>
1. ELECTION OF DIRECTORS [ ] FOR all nominees [ ] WITHHOLD AUTHORITY to
By Holders of Class B 1- SAMUEL C. JOHNSON 2 - HELEN P. JOHNSON-LEIPOLD listed to the left vote for all nominees
Common Stock 3- THOMAS F. PYLE, JR. 4 - GREGORY E. LAWTON (except as listed to the left.
specified below).
(Instructions: To withhold authority to vote for any individual nominee,
write the number(s) of the nominee(s) in the box provided to the right.)
2. Approval of the shareholder proposal regarding the sale of the Company. [ ] FOR [ ] AGAINST [ ] ABSTAIN
</TABLE>
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the Meeting.
Check appropriate box Date: __________________ NO. OF SHARES
Indicate changes below:
Address Change? [ ] Name Change? [ ]
SIGNATURE(S) IN BOX
Note: Please sign exactly as your
name appears on your stock
certificate. Joint owners should
each sign personally. A corporation
should sign full corporate name by
duly authorized officers and affix
corporate seal, if any. When
signing as attorney, executor,
administrator, trustee or guardian,
give full title as such.
