<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF
THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, For Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
MIKASA, 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)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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/ / 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
MIKASA, INC.
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 27, 1998
------------------------
To Our Stockholders:
The Annual Meeting of Stockholders of Mikasa, Inc. (the "Company") will be
held at the Long Beach Hyatt Regency Hotel, 200 South Pine Avenue, Long Beach,
California 90802, on May 27, 1998, at 2:00 p.m. for the following purposes:
1. To elect two directors, each to serve a three-year term;
2. To approve the Mikasa, Inc. 1998 Long-Term Stock Incentive Plan; and
3. To transact such other business as may properly come before the Annual
Meeting and any adjournments thereof.
The Board of Directors has fixed April 3, 1998 as the record date for
determination of stockholders entitled to notice of and to vote at the Annual
Meeting and any adjournment thereof.
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING, PLEASE MARK, DATE
AND SIGN THE ACCOMPANYING PROXY CARD AND RETURN IT PROMPTLY IN THE ENVELOPE
ENCLOSED FOR THAT PURPOSE.
By Order of the Board of Directors
JOSEPH S. MUTO
SECRETARY
Long Beach, California
April 22, 1998
<PAGE>
MIKASA, INC.
20633 SOUTH FORDYCE AVENUE
LONG BEACH, CALIFORNIA 90810
(310) 886-3700
------------------------
PROXY STATEMENT
---------------------
GENERAL
The accompanying proxy is solicited by and on behalf of the Board of
Directors of Mikasa, Inc. (the "Company") in connection with the Annual Meeting
of Stockholders to be held at 2:00 p.m. on May 27, 1998, at the Long Beach Hyatt
Regency Hotel, 200 South Pine Avenue, Long Beach, California 90802, and at any
and all adjournments thereof.
This Proxy Statement and accompanying proxy will first be mailed to
stockholders on or about April 22, 1998. The costs of solicitation of proxies
will be paid by the Company. In addition to soliciting proxies by mail, the
Company's officers, directors and other regular employees, without additional
compensation, may solicit proxies personally or by other appropriate means. The
Company will reimburse brokers, banks, fiduciaries and other custodians and
nominees holding Common Stock in their names or in the names of their nominees
for their reasonable charges and expenses in forwarding proxies and proxy
materials to the beneficial owners of such Common Stock.
VOTING RIGHTS AND OUTSTANDING SHARES
Only stockholders of record of the Company's Common Stock as of April 3,
1998, will be entitled to vote at the Annual Meeting. On April 3, 1998, there
were outstanding 18,370,945 shares of Common Stock, which constituted all of the
outstanding voting securities of the Company. Each share of Common Stock is
entitled to one vote on all matters to come before the Annual Meeting.
Assuming a quorum is present, the affirmative vote of a plurality of the
votes cast will be required for the election of directors, and the affirmative
vote of a majority of the votes cast will be required for the approval of
Proposal 2 and to act on all other matters to come before the Annual Meeting.
For purposes of determining the number of votes cast with respect to any voting
proposal, the sum of votes cast and abstentions is included. Abstentions with
respect to any proposal are counted as "shares present" and have the effect of a
vote "against" such proposal as to which they are specified. Broker non-votes
with respect to any proposal are not considered "shares present" and, therefore,
have the effect of reducing the number of affirmative votes required to achieve
a majority of the votes cast for such proposal.
REVOCABILITY OF PROXIES
Proxies must be written, signed by the stockholder and returned to the
Secretary of the Company. Any stockholder who signs and returns a proxy may
revoke it at any time before it is voted by filing with the Secretary of the
Company a written revocation or a duly executed proxy bearing a date later than
the date of the proxy being revoked. Any stockholder attending the Annual
Meeting in person may withdraw such stockholder's proxy and vote such
stockholder's shares.
DIRECTORS
The Board of Directors is divided into three classes, with the terms of each
class ending in successive years. Two directors are to be elected at the Annual
Meeting to hold office for a term of three years
1
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expiring at the third succeeding Annual Meeting. Certain information with
respect to the nominees for election as directors at the Annual Meeting and the
other directors whose terms of office will continue after the Annual Meeting is
set forth below.
<TABLE>
<CAPTION>
NAME PRINCIPAL OCCUPATION AGE
- --------------------------------- ----------------------------------------------------------------- -------
<S> <C> <C>
NOMINEES FOR TERMS OF OFFICE EXPIRING IN THREE YEARS
GEORGE T. ARATANI................ Mr. Aratani has served as Chairman Emeritus of the Board of 80
Directors of the Company since December 1993. Prior to that
time, he was Chairman of the Board. Mr. Aratani became Chief
Executive Officer and a director of the Company in 1939 and
served as Chief Executive Officer until 1976.
ANTHONY F. SANTARELLI............ Mr. Santarelli has served as a director of the Company since 55
December 1993 and as Executive Vice President--Operations since
1990. Mr. Santarelli joined the Company in 1970.
DIRECTORS WHOSE TERMS OF OFFICE EXPIRE IN ONE YEAR
RAYMOND B. DINGMAN............... Mr. Dingman was named Chief Executive Officer of the Company in 52
August 1996. He has also served as President, Chief Operating
Officer and a director of the Company since December 1993, was
Chief Financial Officer of the Company from December 1993 until
May 1995 and was Executive Vice President and Controller of the
Company from 1990 until December 1993.
NORMAN R. HIGO................... Mr. Higo has served as a director of the Company since 1985. He 59
retired from the Company as an officer effective November 1,
1995 and served as a consultant to the Company through February
1997. Mr. Higo had served as Executive Vice President and
Treasurer since 1985, as President and Chief Operating
Officer--International Operations since December 1993 and as
Secretary of the Company from 1985 until September 1994.
MICHAEL LAX...................... Mr. Lax has served as a director since February 1995. Since 1965, 68
he has been President of Michael Lax Associates, Inc., an
industrial design firm. Mr. Lax's designs are included in the
permanent collections of The Museum of Modern Art (New York
City), The Musee des Arts Decoratifs de Montreal and the Denver
Art Museum.
</TABLE>
2
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<TABLE>
<CAPTION>
NAME PRINCIPAL OCCUPATION AGE
- --------------------------------- ----------------------------------------------------------------- -------
<S> <C> <C>
DIRECTORS WHOSE TERMS OF OFFICE EXPIRE IN TWO YEARS
ALFRED J. BLAKE.................. Mr. Blake was named Chairman of the Board of the Company in 60
December 1993. From 1976 until August 1996, he served as Chief
Executive Officer. He has served as a director since 1976 and
was also the Company's President from 1976 until December 1993.
Mr. Blake joined the Company in 1965.
ROBERT H. HOTZ................... Mr. Hotz was elected a director of the Company in August 1994. 53
Since 1991, Mr. Hotz has been a Managing Director at SBC
Warburg Dillon Read Inc. From 1968 to 1991, he was employed by
Smith Barney Inc. where he last served as a Senior Executive
Vice President. Mr. Hotz is also a director of Universal Health
Services, Inc. and SBC Warburg Dillon Read Inc.
JOSEPH S. MUTO................... Mr. Muto has served as a director of the Company since 1985. He 55
was appointed Secretary and General Counsel of the Company in
September 1994. Prior to joining the Company, Mr. Muto was a
partner in the law firm of Kelley Drye & Warren LLP in Los
Angeles, California.
</TABLE>
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Audit Committee is currently comprised of Messrs. Hotz and Lax. It is
responsible for advising the Board of Directors in connection with the Company's
annual audit and meeting with the Company's independent accountants to review
the Company's internal controls and financial management practices. The Audit
Committee held two meetings in 1997.
The Compensation Committee, currently comprised of Messrs. Hotz and Lax,
oversees the Company's executive officer compensation program, including the
grant of bonuses, reviews the Company's retirement and employee benefit plans
and administers the Mikasa, Inc. Long-Term Incentive Plan. The Compensation
Committee held one meeting in 1997.
The Board of Directors does not have a Nominating Committee.
The Board of Directors held three meetings during 1997. None of the
incumbent directors attended fewer than 75% of the Board meetings and committee
meetings of which he was a member, except that Mr. Aratani did not attend one
Board meeting in July 1997. The Board of Directors has an Executive Committee
which is comprised of Messrs. Blake, Dingman and Santarelli. The members of the
Executive Committee confer on a regular basis between meetings of the Board of
Directors with respect to major policy and significant business and operational
decisions with respect to the Company.
DIRECTORS' COMPENSATION
Non-employee directors receive $15,000 annually, payable quarterly, as
compensation for serving on the Board of Directors, plus $500 for each Board
meeting attended and $500 for each Committee meeting attended held other than in
conjunction with a regular Board Meeting. Non-employee directors are reimbursed
for their reasonable expenses incurred in attending meetings. Eligible
non-employee directors participate in the Non-Employee Directors Stock Option
Plan (the "Directors Plan") which provides for automatic grants of options to
non-employee directors. Former employees are not eligible to participate in
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the Directors Plan. Under the Directors Plan, each eligible non-employee
director who has been elected or who is continuing as a member of the Board of
Directors is granted an option to purchase 2,500 shares of the Company's Common
Stock on the date of each Annual Meeting of the Company's stockholders. Options
are granted at 100% of the fair market value of the Company's Common Stock on
the grant date and have a term of ten years. Option grants vest 50% on the first
anniversary of the grant date and in full on the second anniversary of the grant
date. Messrs. Hotz and Lax were the only Directors eligible to participate in
the Directors Plan in 1997.
EXECUTIVE COMPENSATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table sets forth the compensation of the Chief Executive
Officer, the Chairman of the Board and each of the two other executive officers
(the "Named Executive Officers") for each of the last three years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
------------
ANNUAL COMPENSATION SECURITIES
------------------------ UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) OPTIONS(#) COMPENSATION($)(1)
- ----------------------------------------------------- ---- ---------- --------- ------------ -------------------
<S> <C> <C> <C> <C> <C>
Raymond B. Dingman................................... 1997 356,700 200,000 50,000 2,375
Chief Executive Officer, President and 1996 318,000 220,000 300,000 2,375
Chief Operating Officer 1995 318,000 225,000 47,500 2,310
Alfred J. Blake...................................... 1997 356,700 200,000 50,000 0
Chairman of the Board 1996 397,630 220,000 50,000 0
1995 454,700 245,000 47,500 0
Anthony F. Santarelli................................ 1997 254,800 200,000 50,000 0
Executive Vice President--Operations 1996 231,440 195,000 50,000 0
1995 231,440 200,000 40,000 0
Brenda W. Flores(2).................................. 1997 111,300 55,000 10,000 1,670
Vice President and Chief Financial 1996 107,000 70,000 20,000 2,210
Officer 1995 100,400 70,000 12,500 1,875
</TABLE>
- ------------------------
(1) Represents Company contributions to the accounts of the specified executive
officers under the Company's 401(k) Plan.
(2) Ms. Flores, age 44, has been the Chief Financial Officer of the Company
since May 1995 and a Vice President since December 1993. Ms. Flores was
Chief Accounting Officer and Controller from December 1993 to May 1995 and
was Director of Accounting from April 1986 to December 1993.
The Company entered into an Employment and Consulting Agreement, dated
August 6, 1996, with Mr. Blake (the "Employment Agreement"). Under the
Employment Agreement, Mr. Blake agreed to serve as Chairman of the Board for a
two-year period at an annual base salary established by the Board of Directors
(which, for 1997, was $356,700) plus benefits and executive perquisites
consistent with Company policy, subject to upward adjustments. After such
two-year period, Mr. Blake would serve as a consultant for six years for an
annual payment of $200,000. During and for two years after such consulting
period, Mr. Blake agreed not to compete with the Company in any country where
the Company does significant business.
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<PAGE>
The following table sets forth grants of stock options during the fiscal
year ended December 31, 1997
to the Named Executive Officers. No stock appreciation rights were granted to,
and no stock options were exercised by, any Named Executive Officers during
fiscal 1997.
OPTION GRANTS FOR FISCAL YEAR 1997
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED ANNUAL
------------------------------------------------------ RATES OF STOCK PRICE
% OF TOTAL APPRECIATION FOR OPTION
OPTION GRANTS PER SHARE TERM(2)
OPTIONS TO EMPLOYEES IN EXERCISE EXPIRATION ------------------------
GRANTED(1) FISCAL 1997 PRICE($/SH) DATE 5%($) 10%($)
----------- --------------- ----------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Raymond B. Dingman................ 50,000 15.15% $ 14.00 12/15/07 $ 440,223 $ 1,115,618
Alfred J. Blake................... 50,000 15.15 14.00 12/15/07 440,223 1,115,618
Anthony F. Santarelli............. 50,000 15.15 14.00 12/15/07 440,223 1,115,618
Brenda W. Flores.................. 10,000 3.03 14.00 12/15/07 88,045 223,124
</TABLE>
- ------------------------
(1) These options were granted under the Company's Incentive Plan with ten year
terms. Options vest at the rate of 50% one year from the date of grant and
the remaining 50% two years from the date of grant.
(2) Potential realizable value is based on the assumption that the Common Stock
price appreciates at the annual rate shown (compounded annually) from the
date of grant until the end of the option term. The actual value, if any, an
executive may realize will depend on the excess of the stock price over the
exercise price on the date the option is exercised (if the executive were to
sell the shares on the date of exercise); there is no assurance that the
value realized will be at or near the potential realizable value as
calculated in this table.
DEFINED BENEFIT PENSION PLAN
The following table shows the estimated annual retirement benefits that
would be payable under the Company's Defined Benefit Pension Plan, assuming
retirement at age 65.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF CREDITED SERVICE
-----------------------------------------------------
COMPENSATION 15 20 25 30 35
- ----------------------------------------------------------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
$235,840................................................... $ 82,020 $ 84,250 $ 85,587 $ 86,479 $ 87,116
225,000................................................... 78,860 80,803 81,968 82,745 83,300
200,000................................................... 71,573 72,853 73,620 74,132 74,498
175,000................................................... 64,285 64,903 65,273 65,520 65,696
150,000................................................... 56,786 56,786 56,786 56,786 56,786
125,000................................................... 46,848 46,848 46,848 46,848 46,848
</TABLE>
Compensation covered by the Company's Defined Benefit Pension Plan includes
the employee's base salary and annual bonus, if any, which is the same as the
compensation disclosed in the Salary and Bonus columns of the Summary
Compensation Table, subject to the limitation on maximum compensation which may
be considered in computing benefits under qualified pension plans as set by the
Internal Revenue Service each year. The above table takes into account the
effect of the drop in maximum allowable compensation from $235,840 in 1993 to
$150,000 in 1994 and a rounded cost of living adjustment thereafter. The maximum
allowable compensation for the 1998 plan year is $160,000. Benefits are
determined on the basis of a participant's years of service and compensation
during the employee's highest
5
<PAGE>
compensated five consecutive years of employment. The benefits set forth in the
table are computed on a straight-life annuity basis, assuming retirement at age
65, and are subject to an offset for Social Security benefits. As of December
31, 1997, Mr. Blake was credited with 29 years of service, Mr. Dingman was
credited with 24 years of service, Mr. Santarelli was credited with 26 years of
service and Ms. Flores was credited with 11 years of service. The covered
compensation of all of the Named Executive Officers is presently at the Internal
Revenue Service limitation described above.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
During 1997, the Compensation Committee, which is currently comprised of
Messrs. Hotz and Lax, made compensation decisions for the Company's executive
officers, except with respect to the granting of options under the Mikasa, Inc.
Long-Term Incentive Plan (the "Incentive Plan") which grants were made by the
full Board of Directors based on the recommendations of the Compensation
Committee. The policy of the Committee is that the compensation programs for
executive officers should be effective to attract and retain key executives
responsible for the success of the Company and should be administered for the
long-term interests of the Company and its stockholders. The Company endeavors
to align total compensation for senior executives with Company performance.
The Committee considers various indicators of corporate and individual
performance in determining compensation for executive officers. The Committee
also evaluates executive officer compensation in light of available information
regarding executive salary levels paid by selected competitors and other
available information regarding industry compensation practices that is
available to the Committee. However, the Committee does not target a specific
company or compensation percentile range within the peer group. The Committee's
overall determinations are subjective; it does not apply any specific formula in
making compensation decisions.
BASE SALARY. For 1997, the Committee increased annual base salary levels
from the levels in effect in 1996 as reflected in the Summary Compensation
Table.
ANNUAL BONUS. Executive officers, including the Chief Executive Officer,
and other management personnel are eligible to receive an annual bonus. The
bonus pool for 1997 benefitted approximately 80 participants within the
management of the Company. In late 1997, the Chief Executive Officer made
recommendations to the Committee regarding the size of the bonus pool and
individual bonuses for the year for all executive officers except himself. The
Committee determined the size of the 1997 bonus pool based on its review of the
Company's overall performance during 1997 and the Chief Executive Officer's
recommendation. The Committee awarded individual bonuses based upon a
consideration of its general compensation policies and criteria and its
subjective judgment with respect to the performance of the Company during the
relevant period and the performance of the participant in relation to the level
of responsibility of the participant.
LONG-TERM INCENTIVE AWARDS. The Company's Incentive Plan permits awards to
eligible employees of incentive stock options, non-qualified stock options,
stock appreciation rights and other stock awards. The Board of Directors
believes that the Incentive Plan encourages key personnel of the Company to
increase their interest in the Company's long-term success, thus better linking
employee and stockholder interests, and motivates executive officers to make
long-term decisions which are in the best interest of the Company and that will,
over the long run, generate the best return to stockholders. In December 1997,
the Board granted stock option awards to executive officers pursuant to the
Incentive Plan for their performance during 1997. The grants were based upon the
Board's consideration of the Company's general compensation policies and
criteria, as explained above, and its subjective judgment with respect to the
performance of the Company during the relevant period and the performance of the
participant in relation to the level of responsibility of the participant. The
Board also considered existing stock holdings of individual executive officers
when making such grants.
6
<PAGE>
CHIEF EXECUTIVE OFFICER'S COMPENSATION. The Committee increased Mr.
Dingman's base salary in 1997 to $356,700, taking into account his increasing
level of responsibility, his relocation to the East Coast at the request of the
Company and other factors. Near year end, the Committee awarded a bonus of
$200,000 to Mr. Dingman pursuant to the Company's annual bonus program.
During the year, the Board of Directors elected to award Mr. Dingman options
to purchase 50,000 shares of Common Stock. The Board concluded that a
substantial portion of Mr. Dingman's compensation should be dependent upon an
increase in stockholder value over the current levels and that the Board looked
to Mr. Dingman for leadership in achieving such increase. The award of options
to Mr. Dingman was made with respect to performance in 1997.
The factors considered by the Committee and the Board of Directors in making
these compensation decisions with respect to 1997 included (i) growth in net
sales and earnings over the prior year, (ii) marked growth in net income per
share, as well as an increase in stock value, over 1996 levels. (iii) the
substantial increase in the number of Company-owned stores under management,
(iv) an increased presence in Canada, and substantial contribution to increased
international net sales, resulting from the opening of two additional
Company-owned stores, (v) progress on the planned opening of a new distribution
center, (vi) a broadening of the Company's product line, (vii) the completion of
a $60 million debt financing, (viii) reduced levels of cash flow from operations
and (ix) disappointing results in retail accounts.
POLICY WITH RESPECT TO INTERNAL REVENUE CODE SECTION 162(m). In 1993, the
Internal Revenue Code of 1986 (the "Code") was amended to add Section 162(m).
Section 162(m) and the regulations thereunder place a limit of $1,000,000 on the
amount of compensation that may be deducted by the Company in any year with
respect to certain of the Company's most highly compensated officers. Section
162(m) does not, however, disallow a deduction for qualified "performance-based
compensation," the material terms of which are disclosed to and approved by
stockholders. Awards pursuant to the Company's Long-Term Incentive Plan in 1997
generally should qualify as "performance-based compensation." The Board of
Directors plans to take such actions in the future to minimize the loss of tax
deductions related to compensation as they deem necessary and appropriate in
light of specific compensation objectives.
Robert H. Hotz
Michael Lax
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION. Mr. Hotz is a
Managing Director and a Director of SBC Warburg Dillon Read Inc., which
investment banking firm acted as financial adviser to the Company in 1997.
CERTAIN TRANSACTIONS
Mr. Blake and Mr. Santarelli are the partners of Main Street Associates, a
general partnership. The Company leases from Main Street Associates its factory
store premises located at 93-95 Main Street, Flemington, New Jersey. The lease
currently provides for annual lease payments in the amount of $144,998 and has a
term of ten years expiring in August 1999 with no renewal options. The lease is
upon terms which management believes were comparable to those prevailing in
arms-length transactions for similar leases at the time of its execution. Mr.
Santarelli was not a director of the Company at the time this lease was
approved.
7
<PAGE>
STOCK PERFORMANCE GRAPH
The graph below compares the cumulative total return on the Company's Common
Stock from May 25, 1994, when the Company went public, to December 31, 1997 with
the Standard & Poor's 500 Composite Stock Price Index and a peer group index.
The peer group index is comprised of Bed Bath & Beyond, Inc., The Bombay
Company, Inc., General Housewares Corporation, Lechters, Inc., Libbey Inc.,
Lifetime Hoan Corporation, Newell Companies, Oneida Ltd., Pier 1 Imports, Inc.,
Waterford Wedgwood plc. (ADR) and Williams-Sonoma, Inc. The graph assumes a $100
investment at the beginning of the period and the reinvestment of all dividends.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
TOTAL SHAREHOLDER RETURNS
<S> <C> <C> <C> <C>
MIKASA INC S&P 500 INDEX PEER GROUP
25-May-94 $100.00 $100.00 $100.00
Jun-94 $105.36 $97.58 $101.99
Sep-94 $117.00 $102.35 $105.92
Dec-94 $116.97 $102.34 $102.75
Mar-95 $122.32 $112.30 $107.74
Jun-95 $106.25 $123.02 $103.39
Sep-95 $103.57 $132.80 $107.86
DOLLARS Dec-95 $96.43 $140.80 $112.35
Mar-96 $84.82 $148.35 $125.16
Jun-96 $78.57 $155.01 $140.18
Sep-96 $75.89 $159.80 $140.05
Dec-96 $73.22 $173.12 $144.50
Mar-97 $80.36 $177.76 $147.79
Jun-97 $102.24 $208.80 $181.44
Sep-97 $99.92 $224.44 $190.16
Dec-97 $106.24 $230.88 $202.94
QUARTERS ENDED
</TABLE>
8
<PAGE>
COMPANY PROPOSALS
The following proposals will be submitted for stockholder consideration and
voting at the Annual Meeting.
PROPOSAL 1
ELECTION OF DIRECTORS
The following persons are nominated for election as directors to hold office
for a term of three years expiring at the third succeeding Annual Meeting:
George T. Aratani
Anthony F. Santarelli
The nominees listed above are current members of the Board of Directors. All
proxies received by the Board of Directors will be voted for the nominees if no
directions to the contrary are given. In the event that the nominees are unable
or decline to serve, an event that is not anticipated, the proxies will be voted
for the election of nominees designated by the Board of Directors, or if none
are so designated, will be voted according to the judgment of the person or
persons voting the proxy.
VOTE REQUIRED
The two nominees receiving the highest number of affirmative votes of the
shares entitled to be voted shall be elected as directors. Votes withheld from
any director are counted for purposes of determining the presence or absence of
a quorum for the transaction of business, but have no other legal effect.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE NOMINEES.
PROPOSAL 2
APPROVAL OF THE MIKASA, INC.
1998 LONG-TERM STOCK INCENTIVE PLAN
In April 1998, the Board of Directors of the Company adopted, subject to
stockholder approval, the Mikasa, Inc. 1998 Long-Term Stock Incentive Plan (the
"1998 Incentive Plan"). The Board believes that attracting, motivating and
retaining highly qualified employees and consultants contributes to the growth
and success of the Company and that the long-term success of the Company is
enhanced by a compensation program which includes long-term incentives relating
to stock ownership because such incentives encourage recipients to more closely
align their interests with those of the Company's stockholders by relating
compensation to increases in stockholder value.
The 1998 Incentive Plan provides for grants of stock options, stock
appreciation rights, stock awards and cash awards to employees and consultants.
The 1998 Incentive Plan is intended to replace the existing Mikasa, Inc.
Long-Term Incentive Plan (the "Incentive Plan"), which is scheduled to terminate
in 1999. If the 1998 Incentive Plan is approved by the Company's stockholders,
authority to make further grants under the Incentive Plan will terminate,
although previously granted awards under that plan will remain outstanding in
accordance with their terms.
The full text of the 1998 Incentive Plan is attached to this Proxy Statement
as Exhibit A. Principal features are described below, but such description is
qualified in its entirety by reference to the text.
The Board recommends that stockholders vote for approval of the 1998
Incentive Plan. Proxies solicited by the Board will be voted in favor of
approval unless stockholders specify otherwise in such proxies.
9
<PAGE>
DESCRIPTION OF THE MIKASA, INC. 1998 LONG-TERM STOCK INCENTIVE PLAN
GENERAL. The purpose of the 1998 Incentive Plan is to promote the
longer-term financial success of the Company by providing a means to attract,
retain and award individuals who can and do contribute to such success. Grants
of stock-based compensation under the 1998 Incentive Plan will encourage the
recipients of such awards to further identify their interests with those of the
Company's stockholders.
ELIGIBILITY. The 1998 Incentive Plan provides for the grant of awards to
employees of and consultants to the Company and its subsidiaries selected by a
committee responsible for administering the plan, subject to limitations
contained in the 1998 Incentive Plan. Awards which may be granted under the 1998
Incentive Plan include stock options, including incentive stock options ("ISOs")
and non-qualified stock options ("NQSOs"), stock appreciation rights ("SARs"),
stock awards ("Stock Awards") and cash awards ("Cash Awards").
While all employees are eligible to receive awards under the plan, the Board
of Directors presently contemplates that approximately 50 employees will be
among those receiving awards under the 1998 Incentive Plan. No award may be
granted under the 1998 Incentive Plan subsequent to the tenth anniversary of the
date on which the plan is approved by the Company's stockholders. The number of
shares of common stock of the Company, par value $0.01 ("Shares") available for
issuance under the 1998 Incentive Plan may not exceed the sum of (i) 1,000,000;
(ii) any Shares available for future awards under the prior Incentive Plan as of
the effective date of the 1998 Incentive Plan; and (iii) any Shares represented
by awards granted under any prior plan of the Company which are forfeited,
expire or are canceled without delivery of Shares or which result in the
forfeiture of Shares back to the Company. At April 1, 1998, there were 887,000
shares available for future awards under the Incentive Plan.
PLAN LIMITATIONS. Additional limitations on awards made under the 1998
Incentive Plan include the following: (i) the maximum number of Shares that may
be issued pursuant to ISOs is the total number of Shares available for issuance
under the plan; (ii) no more than 900,000 Shares may be issued in conjunction
with the grant of Stock Awards; (iii) combined grants of stock options and SARs
to any individual may not cover more than 450,000 Shares during any consecutive
three calendar years; and (iv) combined grants of Stock Awards and Cash Awards
to any individual for a specified performance period, not to exceed sixty
consecutive months, may not exceed $5,000,000 in value. The closing price of the
Company's Common Stock on March 4, 1998, as reported on the New York Stock
Exchange, was $14.375 per share.
ADMINISTRATION. The 1998 Incentive Plan will be administered by a committee
composed of two or more non-employee directors; provided, however, that the
Board of Directors may assume, at its sole discretion, administration of the
plan. Among other things, the committee may authorize awards to eligible
participants, specify the types, terms and conditions of such awards, permit
transferability of awards to third parties, interpret the plan's provisions and
administer the plan in a manner consistent with its purpose. The committee may
delegate to the Chief Executive Officer of the Company the right to allocate
awards to persons who are not officers or directors of the Company.
TYPES OF AWARDS UNDER THE PLAN
Stock Options. Stock options, including ISOs and NQSOs, may be granted
by the committee on such terms, including vesting and payment terms, as it
deems appropriate in its discretion; provided that the exercise price shall
be not less than 100% of the fair market value of a Share on the applicable
date as determined by the committee. Additional limitations are applicable
to ISOs granted to holders of 5% or more of the Company's outstanding
shares. As is the case with the other types of awards available under the
1998 Incentive Plan, stock options may be granted singularly, in combination
with another award(s) or in tandem whereby exercise or vesting of one award
held by the participant
10
<PAGE>
cancels another of the participant's awards. Payment for Shares received on
exercise of an option may be made in cash or by such other means as the
committee may permit.
SARs. Participants may receive, at the discretion of the committee,
awards of a right to receive payment in cash, Shares or a combination equal
to the excess of the aggregate market price at the time of exercise of a
specified number of Shares over the aggregate exercise price of the SAR
being exercised, such aggregate exercise price being based on the fair
market value of a Share on the applicable date as determined by the
committee.
Stock Awards. The committee, in its discretion, may make a grant of
Shares or of a right to receive Shares (or their cash equivalent or a
combination of both) in the future to a participant on such terms as the
committee shall determine.
Cash Awards. The committee, in its discretion, may make a grant of a
right denominated in cash or cash units to receive a payment (in cash,
Shares or a combination of both) based on the attainment of pre-established
performance goals and such other terms as the committee shall determine.
PERFORMANCE GOALS. The committee may grant Stock Awards and Cash Awards
under such terms and conditions as it deems appropriate, which may include the
achievement of certain performance goals. The performance goals the committee
may use in determining awards consist of cash generation targets, profits,
revenue and market share targets, profitability targets as measured by return
ratios, and stockholder returns. The committee may measure performance using a
single goal criterion or multiple goal criteria, and such measurement may be
based on Company performance, business unit performance and/or performance as
compared to that of other publicly-traded companies.
AMENDMENT AND TERMINATION. The Board of Directors may amend, suspend or
terminate the 1998 Incentive Plan at any time; provided, however, that (i) the
Share limitations set forth in Sections 3(a) and 3(b) of the Plan cannot be
increased and (ii) the minimum stock option and stock appreciation right
exercise prices set forth in Section 2(c) of the Plan cannot be changed, unless
approved by the Company's stockholders.
NEW PLAN BENEFITS. Actual awards under the 1998 Incentive Plan cannot be
determined at this time. Such awards will depend on the criteria established
from time to time by the committee. Information about stock options awarded to
the Named Executive Officers under the existing Incentive Plan, which is
intended to be replaced by the 1998 Incentive Plan, can be found in the table
entitled "Option Grants For Fiscal Year 1997" in the Executive Compensation
portion of this Proxy Statement. Had the 1998 Incentive Plan been in effect for
the 1997 fiscal year, grants of awards to the Named Executive Officers would
have been substantially the same as the grants made under the existing Incentive
Plan.
FEDERAL INCOME TAX CONSEQUENCES
Under current Internal Revenue Service Regulations, the federal income tax
consequences of awards granted under the Plan are summarized as follows:
The grant of a stock option or SAR will create no tax consequences for the
participant or the Company. The participant will have no taxable income upon
exercising an ISO (except that the alternative minimum tax provisions of the
Internal Revenue Regulations may apply), and the Company will not receive a
deduction when the ISO is exercised. If the participant does not dispose of the
shares acquired on exercise of an ISO within the two-year period beginning on
the day after the grant of the ISO or within one year after the transfer of the
shares to the participant, the gain or loss on a subsequent sale will be a
capital gain or loss to the participant. If the participant disposes of the
shares within the two-year or one-year periods described above, the participant
generally will realize ordinary income and the Company will be entitled to a
corresponding deduction. Upon exercise of an SAR or an NQSO, the participant
must
11
<PAGE>
recognize ordinary income in an amount equal to the difference between the
exercise price and the fair market value of the stock on the exercise date. The
Company will receive a corresponding deduction for the same amount.
With respect to Stock Awards granted under the 1998 Incentive Plan, the
participant must recognize ordinary income in an amount equal to the fair market
value of the shares received at such time that the shares become transferable or
not subject to a substantial risk of forfeiture, whichever occurs earlier.
The tax treatment upon disposition of shares acquired under the 1998
Incentive Plan depends on how long the shares have been held. In the case of
shares acquired through exercise of an option, the tax treatment will also
depend on whether or not the shares were acquired by exercising an ISO. There
will be no tax consequences to the Company upon the disposition of shares
acquired under the 1998 Incentive Plan except that the Company may receive a
deduction in the case of disposition of shares acquired under an ISO before the
applicable ISO holding period has been satisfied.
The Company believes that, upon stockholder approval, compensation received
upon the exercise of stock options thereafter granted under the 1998 Incentive
Plan will qualify as "performance-based compensation," and that the compensation
element related to such exercise will, therefore, be deductible under Section
162(m) of the Code.
VOTE REQUIRED
The affirmative vote of a majority of the shares of Common Stock voting at
the Annual Meeting is required to approve the 1998 Incentive Plan. In the event
the 1998 Incentive Plan is not approved, the existing Incentive Plan will remain
in effect in accordance with its terms.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" PROPOSAL 2.
12
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as of March 4, 1998, with respect
to Common Stock of the Company beneficially owned (as defined by applicable
rules for proxy statement reporting purposes) by (i) each person known by the
Company to be the beneficial owner of more than 5% of the outstanding Common
Stock, (ii) each director and director nominee of the Company, (iii) each Named
Executive Officer and (iv) all directors and executive officers of the Company
as a group. Except as noted below, and subject to applicable community property
and similar laws, each stockholder has sole voting and investment powers with
respect to the shares shown.
<TABLE>
<CAPTION>
NUMBER OF SHARES
OF COMMON PERCENT OF SHARES
NAME STOCK(5) OF COMMON STOCK
- ------------------------------------------------------------------------------- ----------------- -----------------
<S> <C> <C>
Alfred J. Blake(1)............................................................. 4,028,853 21.1%
George T. Aratani(1)(2)........................................................ 2,488,469 13.0
Norman R. Higo(1)(3)........................................................... 1,920,584 10.0
Anthony F. Santarelli(1)....................................................... 1,652,038 8.6
Raymond B. Dingman(1)(4)....................................................... 1,514,537 7.9
Tadao Yamada(1)................................................................ 1,272,463 6.6
Brenda W. Flores............................................................... 82,146 *
Joseph S. Muto................................................................. 18,065 *
Robert H. Hotz................................................................. 12,750 *
Michael Lax.................................................................... 3,750 *
All directors and executive officers as a group (9 persons).................... 11,721,192 61.3%
</TABLE>
- ------------------------
* Less than one percent
(1) The address for Messrs. Blake, Aratani and Higo is 20633 South Fordyce
Avenue, Long Beach, California 90810. The address for Messrs. Dingman,
Santarelli and Yamada is One Mikasa Drive, Secaucus, New Jersey 07094.
(2) Includes shares held in a trust as to which Mr. Aratani and his wife are
trustees.
(3) Includes shares held in a trust as to which Mr. Higo and his wife are
trustees.
(4) Includes shares held in a trust as to which Mr. Dingman is the trustee and
shares held in another trust as to which Mr. Dingman and his wife are
trustees.
(5) Includes options exercisable within 60 days as follows: A. J. Blake--72,500
shares; N. R. Higo--10,000 shares; A. F. Santarelli--65,000 shares; R. B.
Dingman--197,500 shares; B. W. Flores--27,500 shares; J. S. Muto--15,000
shares; R. H. Hotz--3,750 shares; Michael Lax--3,750 shares; and all
directors and executive officers as a group--395,000 shares.
SECTION 16(a) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers, directors and persons who own more than ten percent of the Company's
Common Stock to file with the Securities and Exchange Commission initial reports
of ownership and reports of changes in ownership of the Common Stock of the
Company. To the Company's knowledge, based solely on its review of the copies of
such reports furnished to the Company and written representations that no other
reports were required, the Company believes that all of its officers and
directors and greater than ten percent beneficial owners complied with all
Section 16(a) filing requirements applicable to them with respect to
transactions during the fiscal year ended December 31, 1997.
13
<PAGE>
INDEPENDENT ACCOUNTANTS
The Company's Board of Directors has selected Coopers & Lybrand L.L.P. as
the Company's independent accountants for the fiscal year ending December 31,
1998. A representative of Coopers & Lybrand L.L.P. is expected to be present at
the Annual Meeting and will have the opportunity to make a statement if the
representative so desires and to respond to appropriate questions.
STOCKHOLDER PROPOSALS AND NOMINATIONS
Any stockholder intending to submit to the Company a proposal for inclusion
in the Company's Proxy Statement and proxy for the 1999 Annual Meeting must
submit such proposal so that it is received by the Company no later than
December 23, 1998. Stockholder proposals should be submitted to the Secretary of
the Company. No stockholder proposals were received for inclusion in this proxy
statement.
Pursuant to the Company's Bylaws, no business proposal will be considered
properly brought before the next annual meeting by a stockholder, and no
nomination for the election of directors will be considered properly made at the
next annual meeting by a stockholder, unless notice thereof, which contains
certain information required by the Bylaws, is provided to the Company no later
than 60 days prior to the date of the next annual meeting.
OTHER MATTERS
While the Notice of Annual Meeting of Stockholders calls for the transaction
of such other business as may properly come before the meeting, the Board of
Directors has no knowledge of any matters to be presented for action by the
stockholders other than as set forth above. The enclosed proxy gives
discretionary authority to the proxyholders with respect to other business that
may properly come before the meeting.
ANNUAL REPORT TO STOCKHOLDERS
The Company's Annual Report for the year ended December 31, 1997 is being
mailed to stockholders together with this Proxy Statement.
THE COMPANY WILL SEND TO STOCKHOLDERS UPON WRITTEN REQUEST, WITHOUT CHARGE,
A COPY OF THE COMPANY'S 1997 ANNUAL REPORT ON FORM 10-K (WITHOUT EXHIBITS) AS
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. REQUESTS FOR A COPY SHOULD BE
DIRECTED TO THE SECRETARY, MIKASA, INC., 20633 SOUTH FORDYCE AVENUE, LONG BEACH,
CALIFORNIA 90810.
STOCKHOLDERS ARE URGED TO IMMEDIATELY MARK, DATE, SIGN AND RETURN THE
ENCLOSED PROXY IN THE ENVELOPE PROVIDED, TO WHICH NO POSTAGE NEED BE AFFIXED IF
MAILED IN THE UNITED STATES.
By Order of the Board of Directors
JOSEPH S. MUTO
SECRETARY
Long Beach, California
April 22, 1998
14
<PAGE>
EXHIBIT A
MIKASA, INC.
1998 LONG-TERM STOCK INCENTIVE PLAN
1. THE PLAN
(a) PURPOSE. The purpose of this 1998 Long-Term Stock Incentive Plan (the
"Plan") is to promote the longer-term financial success of Mikasa, Inc. (the
"Company") by providing a means to attract, retain and award individuals who can
and do contribute to such success. By using stock-based compensation, the
recipients of awards under the Plan will further identify their interests with
those of the Company's stockholders.
(b) EFFECTIVE DATE. To serve this purpose, the Plan will become effective
upon its approval by the affirmative vote of a majority of the shares present or
represented by proxy at the Company's 1998 Annual Meeting of Stockholders. No
award may be granted pursuant to the Plan subsequent to the tenth anniversary of
its effective date.
2. ADMINISTRATION
(a) COMMITTEE. The Plan shall be administered by a Committee, appointed by
the Board of Directors of the Company, which shall consist of no less than two
of its members, all of whom shall not be current or former employees of the
Company (the "Committee"); provided, however, that the Board of Directors of the
Company may assume, at its sole discretion, administration of the Plan.
(b) POWERS AND AUTHORITY. The Committee's powers and authority include,
but are not limited to, selecting individuals who are employees of or
consultants to the Company and any subsidiary of the Company or other entity in
which the Company has a significant equity or other interest as determined by
the Committee; determining the types and terms and conditions of all awards
granted, including performance and other earnout and/or vesting contingencies;
permitting transferability of awards to third parties; interpreting the Plan's
provisions; and administering the Plan in a manner that is consistent with its
purpose. The Committee may delegate the grant of awards to persons who are not
officers or directors to the Chief Executive Officer on such terms as it may
determine.
(c) AWARD PRICES. For Plan purposes, all stock options and stock
appreciation rights shall have an exercise price which shall reflect 100% of the
fair market value of a share of the common stock of the Company, par value $0.01
("Share") on the applicable date as determined by the Committee. The applicable
date shall be the date on which the award is granted, except that the Committee
may provide that the applicable date may be: (i) the day on which an award
recipient was hired, promoted or such similar singular event occurred, provided
that the grant of such award occurs within 90 days following such applicable
date; or (ii) in the case of a stock option or stock appreciation right granted
retroactively in tandem with or as a substitution for another previously granted
stock option or stock appreciation right, the applicable date for such prior
award.
3. SHARES SUBJECT TO THE PLAN
(a) MAXIMUM SHARES AVAILABLE FOR DELIVERY. Subject to Section 3(d), the
maximum number of Shares that may be delivered to participants and their
beneficiaries under the Plan shall be equal to the sum of (i) 1,000,000; (ii)
any Shares available for future awards under the Company's 1989 Long-Term
Incentive Plan as of the effective date of this Plan; and (iii) any Shares that
are represented by awards granted under any prior plan of the Company, which are
forfeited, expire or are canceled without the delivery of Shares or which result
in the forfeiture of Shares back to the Company. In addition, any Shares
A-1
<PAGE>
granted under the Plan which are forfeited back to the Company because of the
failure to meet an award contingency or condition shall again be available for
delivery pursuant to new awards granted under the Plan. Any Shares covered by an
award (or portion of an award) granted under the Plan, which is forfeited or
canceled, expires or is settled in cash, shall be deemed not to have been
delivered for purposes of determining the maximum number of Shares available for
delivery under the Plan. Likewise, if any stock option is exercised by tendering
Shares, either actually or by attestation, to the Company as full or partial
payment in connection with the exercise of a stock option under this Plan or any
prior plan of the Company, only the number of Shares issued net of the Shares
tendered shall be deemed delivered for purposes of determining the maximum
number of Shares available for delivery under the Plan. Further, Shares issued
under the Plan through the settlement, assumption or substitution of outstanding
awards or obligations to grant future awards as a result of acquiring another
entity shall not reduce the maximum number of Shares available for delivery
under the Plan.
(b) OTHER PLAN LIMITS. Subject to Section 3(d), the following additional
maximums are imposed under the Plan. The maximum number of Shares that may be
delivered through stock options intended to comply with Section 422 of the
Internal Revenue Code ("incentive stock options") shall be equal to the maximum
number of shares available for delivery pursuant to the Plan. The maximum number
of Shares that may be issued in conjunction with awards granted pursuant to
Section 4(d) shall be 900,000. The maximum number of shares that may be covered
by awards granted to any one individual pursuant to Sections 4(b) and 4(c) shall
be 450,000 during any consecutive three calendar years. The maximum payment that
can be made for awards granted to any one individual pursuant to Sections 4(d)
and 4(e) shall be $5,000,000 for any single or combined performance goals
established for a specified performance period. If a payment under Sections 4(d)
or 4(e) is made in Shares, the value of such Shares for determining this maximum
individual payment amount will be the closing price of a Share on the first day
of the applicable performance period. A specified performance period for
purposes of this performance goal payment limit shall not exceed a sixty (60)
consecutive month period.
(c) PAYMENT SHARES. Subject to the overall limitation on the number of
Shares that may be delivered under the Plan, the Committee may use available
Shares as the form of payment for compensation, grants or rights earned or due
under any other compensation plans or arrangements of the Company, including the
plan of any entity acquired by the Company.
(d) ADJUSTMENTS FOR CORPORATE TRANSACTIONS. The Committee may determine
that a corporate transaction has affected the price per Share such that an
adjustment or adjustments to outstanding awards are required to preserve (or
prevent enlargement of) the benefits or potential benefits intended at time of
grant. For this purpose a corporate transaction will include, but is not limited
to, any stock dividend, stock split, extraordinary cash dividend,
recapitalization, reorganization, merger, consolidation, split-up, spin-off,
combination or exchange of shares, or other similar occurrence. In the event of
such a corporate transaction, the Committee may, in such manner as the Committee
deems equitable, adjust (i) the number and kind of shares which may be delivered
under the Plan pursuant to Sections 3(a) and 3(b); (ii) the number and kind of
shares subject to outstanding awards; and (iii) the exercise price of
outstanding stock options and stock appreciation rights; as well as make any
other adjustments that the Committee determines as equitable.
4. TYPES OF AWARDS
(a) GENERAL. An award may be granted singularly, in combination with
another award(s) or in tandem whereby exercise or vesting of one award held by a
participant cancels another award held by the participant. Subject to Section
2(c), an award may be granted as an alternative to or replacement of an existing
award under the Plan or under any other compensation plans or arrangements of
the Company,
A-2
<PAGE>
including the plan of any entity acquired by the Company. The types of awards
that may be granted under the Plan include:
(b) STOCK OPTION. A stock option represents a right to purchase a
specified number of Shares during a specified period at a price per Share which
is no less than that required by Section 2(c). A stock option may be in the form
of an incentive stock option or in a form which does not qualify for favorable
federal tax treatment. The Shares covered by a stock option may be purchased by
means of a cash payment or such other means as the Committee may from
time-to-time permit, including (i) tendering (either actually or by attestation)
Shares valued using the market price at the time of exercise, (ii) authorizing a
third party to sell Shares (or a sufficient portion thereof) acquired upon
exercise of a stock option and to remit to the Company a sufficient portion of
the sale proceeds to pay for all the Shares acquired through such exercise and
any tax withholding obligations resulting from such exercise; (iii) crediting
towards the purchase price amounts from individuals' deferred compensation
account balances, including accrued dividend equivalent balances; or (iv) any
combination of the above.
(c) STOCK APPRECIATION RIGHT. A stock appreciation right is a right to
receive a payment in cash, Shares or a combination, equal to the excess of the
aggregate market price at time of exercise of a specified number of Shares over
the aggregate exercise price of the stock appreciation rights being exercised.
(d) STOCK AWARD. A stock award is a grant of Shares or of a right to
receive Shares (or their cash equivalent or a combination of both) in the
future. Each stock award shall be subject to such conditions, restrictions and
contingencies as the Committee shall determine. These may include continuous
service and/or the achievement of performance goals. The performance goals that
may be used by the Committee for such awards shall consist of cash generation
targets, profit, revenue and market share targets, profitability targets as
measured by return ratios, and stockholder returns. The Committee may designate
a single goal criterion or multiple goal criteria for performance measurement
purposes with the measurement based on absolute Company or business unit
performance and/or on performance as compared with that of other publicly-traded
companies.
(e) CASH AWARD. A cash award is a right denominated in cash or cash units
to receive a payment, which may be in the form of cash, Shares or a combination,
based on the attainment of pre-established performance goals and such other
conditions, restrictions and contingencies as the Committee shall determine. The
performance goals that may be used by the Committee for such awards shall
consist of cash generation targets, profits, revenue and market share targets,
profitability targets as measured by return ratios and stockholder returns. The
Committee may designate a single goal criterion or multiple goal criteria for
performance measurement purposes with the measurement based on total Company or
business unit performance and/or on performance as compared with that of other
publicly-traded companies.
5. AWARD SETTLEMENTS AND PAYMENTS
(a) DIVIDENDS AND DIVIDEND EQUIVALENTS. An award may contain the right to
receive dividends or dividend equivalent payments which may be paid either
currently or credited to a participant's account. Any such crediting of
dividends or dividend equivalents or reinvestment in Shares may be subject to
such conditions, restrictions and contingencies as the Committee shall
establish, including the reinvestment of such credited amounts in Share
equivalents.
(b) PAYMENTS. Awards may be settled through cash payments, the delivery of
Shares, the granting of awards or combination thereof as the Committee shall
determine. Any award settlement, including payment deferrals, may be subject to
such conditions, restrictions and contingencies as the Committee shall
determine. The Committee may permit or require the deferral of any award
payment, subject to such rules and procedures as it may establish, which may
include provisions for the payment or crediting of interest, or dividend
equivalents, including converting such credits into deferred Share equivalents.
A-3
<PAGE>
6. PLAN AMENDMENT AND TERMINATION
(a) AMENDMENTS. The Company's Board of Directors may amend this Plan as it
deems necessary and appropriate to better achieve the Plan's purpose provided,
however, that (i) the Share limitations set forth in Sections 3(a) and 3(b)
cannot be increased and (ii) the minimum stock option and stock appreciation
right exercise prices set forth in Section 2(c) cannot be changed, unless such a
plan amendment is properly approved by the Company's stockholders.
(b) PLAN SUSPENSIONS AND TERMINATION. The Board of Directors of the
Company may suspend or terminate this Plan at any time. Any such suspension or
termination shall not of itself impair any outstanding award granted under the
Plan or the applicable participant's rights regarding such award.
7. MISCELLANEOUS
(a) NO INDIVIDUAL RIGHTS. No person shall have any claim or right to be
granted an award under the Plan. Neither the Plan nor any action taken hereunder
shall be construed as giving any employee or other person any right to continue
to be employed by or to perform services for the Company, any subsidiary or
related entity. The right to terminate the employment of or performance of
services by any Plan participant at any time and for any reason is specifically
reserved to the employing entity.
(b) BINDING ARBITRATION. Any dispute or disagreement regarding
participation and/or an award recipient's rights under the Plan shall be settled
solely by binding arbitration in accordance with the applicable rules of the
American Arbitration Association.
(c) UNFUNDED PLAN. The Plan shall be unfunded and shall not create (or be
construed to create) a trust or a separate fund or funds. The Plan shall not
establish any fiduciary relationship between the Company and any participant or
beneficiary of a participant. To the extent any person holds any obligation of
the Company by virtue of an award granted under the Plan, such obligation shall
merely constitute a general unsecured liability of the Company and accordingly
shall not confer upon such person any right, title or interest in any assets of
the Company.
(d) OTHER BENEFIT AND COMPENSATION PROGRAMS. Unless otherwise specifically
determined by the Committee, settlements of awards received by participants
under the Plan shall not be deemed a part of a participant's regular, recurring
compensation for purposes of calculating payments or benefits from any Company
benefit plan or severance program. Further, the Company may adopt other
compensation programs, plans or arrangements as it deems appropriate.
(e) NO FRACTIONAL SHARES. No fractional Shares shall be issued or
delivered pursuant to the Plan or any award, and the Committee shall determine
whether cash shall be paid or transferred in lieu of any fractional Shares, or
whether such fractional Shares or any rights thereto shall be canceled.
(f) LIMIT ON DISTRIBUTION. Notwithstanding any other provision of the
Plan, the Company shall have no liability to deliver any Shares under the Plan
or make any other distribution of benefits under the Plan unless such delivery
or distribution would comply with all applicable laws (including, without
limitation, the requirements of the Securities Act of 1933), and the applicable
requirements of any securities exchange or similar entity.
(g) TAX WITHHOLDING. Whenever the Company proposes or is required to
distribute Shares under the Plan, the Company may require the recipient to remit
to the Company an amount sufficient to satisfy any Federal, state and local tax
withholding requirements prior to the delivery of any certificate for such
Shares or, in the discretion of the Committee, the Company may withhold from the
Shares to be delivered Shares sufficient to satisfy all or a portion of such tax
withholding requirements. Whenever under the Plan payments are to be made in
cash, such payments may be net of an amount sufficient to satisfy any Federal,
state and local tax withholding requirements.
A-4
<PAGE>
DETACH HERE
PROXY
MIKASA, INC.
20633 SOUTH FORDYCE AVENUE, LONG BEACH, CALIFORNIA 90810
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Raymond B. Dingman and Joseph S. Muto,
or either of them, with unlimited power of substitution, as Proxies to
represent the undersigned at the Annual Meeting of Stockholders of MIKASA,
INC., to be held on Wednesday, May 27, 1998 at the Hyatt Regency Long Beach,
200 South Pine Avenue, Long Beach, California 90802, at 2:00 p.m., or any
adjournment or adjournments thereof, and to vote, as directed on the reverse
side, all shares of Common Stock, which the undersigned would be entitled to
vote if then personally present.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR THE NOMINEE DIRECTORS LISTED, FOR PROPOSAL 2, AND AS
SAID PROXIES DEEM ADVISABLE ON SUCH OTHER BUSINESS AS MAY PROPERLY COME
BEFORE THE MEETING.
SEE REVERSE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE
SIDE SIDE
<PAGE>
DETACH HERE
/X/Please mark
votes as in
this example
1. ELECTION OF DIRECTORS
NOMINEES: George T. Aratani and Anthony F. Santarelli
FOR all nominees / / / / WITHHOLD AUTHORITY
listed above to vote for all
(except as marked Nominees listed above
to the contrary below)
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(INSTRUCTION: To withhold authority to vote for any individual
nominee write that nominee's name on the space provided above.)
FOR AGAINST ABSTAIN
2. To approve the MIKASA, Inc. 1998 / / / / / /
Long-Term Stock Incentive Plan:
3. In their discretion, the Proxies are authorized to vote upon such
other business as may properly come before the meeting.
MARK HERE FOR / / MARK HERE IF / /
ADDRESS CHANGE AND YOU PLAN TO ATTEND
NOTE AT LEFT THE MEETING
PLEASE MARK, SIGN, DATE AND RETURN YOUR PROXY
PROMPTLY IN THE POSTPAID ENVELOPE PROVIDED.
NOTE: Please sign exactly as your name appears at the left.
When shares are held by joint tenants, both should sign. When
signing as attorney, as executor, administrator, trustee or
guardian, please give full title as such. If a corporation, please sign
in full corporate name by President or other authorized officer. If a
partnership or limited liability company, please sign in partnership
or limited liability company name by authorized person.
Signature: Date:
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Signature: Date:
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