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-12.
Rawlings Sporting Goods Company, 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>
RAWLINGS SPORTING GOODS COMPANY, INC.
1859 INTERTECH DRIVE
FENTON, MISSOURI 63026
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The Annual Meeting of Stockholders of Rawlings Sporting
Goods Company, Inc. (the "Company") will be held at Maritz, Inc.,
1355 North Highway Drive, Fenton, Missouri 63099 on April 13,
2000 at 9:00 a.m., Central Time, to consider and take action with
respect to the following:
1. To elect two Directors for a class of Directors to serve
until the annual meeting following the Company's fiscal year
ending August 31, 2002.
2. To ratify the Board of Directors' selection of Arthur
Andersen LLP as independent public accountants of the Company for
the Company's fiscal year ending August 31, 2000.
3. To consider and act upon a shareholder proposal to revoke
the Rights Agreement, dated July 1, 1994, if properly introduced
at the Annual Meeting.
4. To conduct such other business as may properly come before
the Annual Meeting or any adjournments thereof.
Stockholders of record at the close of business on February
17, 2000 are entitled to notice of and to vote at the Annual
Meeting or any adjournments thereof.
All stockholders are cordially invited to attend the
meeting.
By Order of the Board of Directors
/s/ Howard B. Keene
Howard B. Keene
Secretary
Dated: March 1, 2000
YOUR VOTE IS IMPORTANT.
PLEASE COMPLETE, DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT
IN THE ENCLOSED ENVELOPE, WHETHER OR NOT YOU EXPECT TO ATTEND
THE MEETING.
<PAGE>
RAWLINGS SPORTING GOODS COMPANY, INC.
1859 INTERTECH DRIVE
FENTON, MISSOURI 63026
________________________________
PROXY STATEMENT
MAILED ON MARCH 1, 2000
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON APRIL 13, 2000
This Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Directors of Rawlings
Sporting Goods Company, Inc. (the "Company") to be used at the
Annual Meeting of Stockholders to be held on April 13, 2000 and
at any adjournments thereof. The time and place of the Annual
Meeting are stated in the Notice of Annual Meeting of
Stockholders (the "Notice") which accompanies this Proxy
Statement.
The expense of soliciting proxies, including the costs of
preparing, assembling and mailing the Notice, Proxy Statement and
Proxy, will be borne by the Company. In addition to the use of
the mails, proxies may be solicited personally or by telephone or
telegraph, and the Company may pay persons holding shares for
others their expenses in sending proxy materials to their
principals.
VOTING SECURITIES AND VOTES REQUIRED
Only stockholders of record at the close of business on
February 17, 2000 ("Record Date") are entitled to notice of and
to vote at the Annual Meeting. At the close of business on the
Record Date, the Company had outstanding and entitled to vote
7,919,034 shares of Common Stock, par value $.01 per share (the
"Common Stock"). Each share of Common Stock is entitled to one
vote.
The holders of record of a majority of the number of shares
of Common Stock issued, outstanding and entitled to vote on any
matter shall constitute a quorum at the Annual Meeting. Shares
of Common Stock present in person or represented by proxy
(including shares which abstain or withhold a vote with respect
to one or more of the matters presented for stockholder approval)
will be counted for purposes of determining whether a quorum is
present.
Each candidate for election as a Director must receive a
plurality of the votes cast by the stockholders present in person
or represented by proxy and entitled to vote at the Annual
Meeting. The affirmative vote of the holders of a majority of
the shares of Common Stock, present in person or represented by
proxy and entitled to vote at the Annual Meeting, provided a
quorum is present, is required to ratify the Board of Directors'
selection of Arthur Andersen LLP as independent public
accountants of the Company for the Company's fiscal year ending
August 31, 2000 (Item 2), and to approve the shareholder proposal
to revoke the Company's Rights Agreement (Item 3).
Shares represented by proxies which are marked "WITHHELD"
with regard to the election of Directors will be excluded
entirely from the vote and will have no effect. Shares
represented by proxies which are marked "ABSTAIN" with respect to
the other matters presented for consideration at the Annual
Meeting (including Items 2 and 3) will be considered present in
person or represented by proxy at the meeting and, accordingly,
will have the effect of a negative vote because those matters
each require the affirmative vote of the holders of a majority of
the shares of Common Stock present in person or represented by
proxy and entitled to vote at the Annual Meeting. In addition,
where brokers are prohibited from exercising discretionary
authority for beneficial owners who have not provided voting
instructions with respect to a particular matter ("broker non-
votes"), those shares will have no effect on the outcome of such
matter.
Shares entitled to vote represented by proxies which are
properly executed and returned before the Annual Meeting will be
voted at the Annual Meeting as directed therein. If no vote is
specified therein, the shares will be voted "FOR" the election of
the Directors named as nominees in the Proxy Statement, "FOR" the
ratification of the selection of Arthur<PAGE> Andersen LLP as
independent public accountants of the Company for the Company's
fiscal year ending August 31, 2000, and "AGAINST" the shareholder
proposal to revoke the Company's Rights Agreement.
The Board of Directors does not know of any other business
to be presented for consideration at the Annual Meeting. If any
other business properly comes before the Annual Meeting or any
adjournment thereof, the proxies will be voted on such matters in
the discretion of the proxy holders insofar as the proxies are
not limited to the contrary. The Delaware General Corporation
Law provides that, unless otherwise provided in the proxy and
unless the proxy is coupled with an interest, a stockholder may
revoke a proxy previously given at any time prior to its exercise
at the Annual Meeting. A stockholder who has given a proxy may
revoke it at any time before it is exercised by delivering to any
of the persons named as proxies, or to the Company addressed to
the Secretary, an instrument revoking the proxy, by appearing at
the Annual Meeting and voting in person or by executing a later
dated proxy which is exercised at the Annual Meeting.
PRINCIPAL STOCKHOLDERS
The stockholders named in the following table are the only
stockholders known to the Company to be the beneficial owners of
five percent (5%) or more of the Company's Common Stock as of
February 1, 2000. For purposes of this table, and as used
elsewhere in this Proxy Statement, the term "beneficial owner"
means any person who, directly or indirectly, has or shares the
power to vote, or to direct the voting of, a security or the
power to dispose, or to direct the disposition, of a security.
NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT
BENEFICIAL OWNERS BENEFICIAL OWNERSHIP OF CLASS
First Pacific Advisors, Inc. 893,500(1) 11.3%
11400 West Olympic
Boulevard, Suite 1200
Los Angeles, California
90064
Bull Run Corporation 806,500(2) 10.2%
4370 Peachtree Rd. NE
Atlanta, Georgia 30319
(1) This amount, as reflected in an amended report on
Schedule 13G dated February 12, 1999, consists of no sole
voting power, shared voting power with respect to
368,500 shares, no sole dispositive power and shared
dispositive power with respect to 893,500 shares.
(2) This amount, as reflected in an amended report on
Schedule 13D dated July 9, 1999, does not include
925,804 shares of Common Stock issuable to Bull
Run Corporation upon exercise of a Common
Stock Purchase Warrant which is not currently
exercisable. Robert S. Prather, Jr. is the
President and Chief Executive Officer of Bull
Run Corporation. Pursuant to a Standstill
Agreement, dated November 21, 1998, as amended (the
"Bull Run Standstill Agreement"), between the
Company and Bull Run Corporation, Bull Run
Corporation is entitled to select two nominees to
the Board of Directors of the Company. Mr. Prather
and Charles L. Jarvie were selected by Bull Run
Corporation as its nominees and appointed to
the Board of Directors during the Company's
fiscal year ended August 31, 1998. Under the
terms of the Bull Run Standstill Agreement,
Bull Run Corporation must vote all of its shares of
Common Stock entitled to vote in favor of the
directors nominated by the Board of Directors in
this Proxy Statement.
<PAGE>
STOCK OWNERSHIP OF DIRECTORS,
THE NOMINEES FOR DIRECTOR AND EXECUTIVE OFFICERS
The following table and notes thereto set forth information,
as of February 1, 2000, with respect to the beneficial ownership
of shares of Common Stock by each Director, each person nominated
by the Board for election to the Board of Directors and each
Executive Officer named in the Summary Compensation Table and by
the Directors and Executive Officers of the Company, as a group,
based upon information furnished to the Company by such persons:
AMOUNT OF BENEFICIAL OWNERSHIP
AS OF FEBRUARY 1, 2000 (1)
AMOUNT AND
NATURE OF
NAME OF BENEFICIAL BENEFICIAL PERCENT
OWNER OWNERSHIP OF CLASS
Andrew N. Baur (d) 30,607(2) *
Linda L. Griggs (d) 5,003(3) *
Jonathan Hodgins 17,363(4) *
Charles L. Jarvie (d) 4,231(5) *
Howard B. Keene 108,794(6) 1.4%
Michael McDonnell (d) 80,709(7) 1.0%
Stan W. Morrison (d) 9,360(8) *
Stephen M. O'Hara (d) 183,920(9) 2.3%
Rexford K. Peterson 0 *
Robert S. Prather, Jr. (d) 812,931(10) 10.3%
Michael J. Roarty (d) 17,128(11) *
William C. Robinson (d) 38,628(12) *
All Current Directors and 1,481,999 18.7%
Executive Officers as a
Group (15 persons)
______________________________
(d) Director
* Less than 1%
(1) Each Director and Executive Officer owning shares listed or
included in this table exercises sole voting and dispositive
power over such shares, except as otherwise indicated in
footnotes (2) through (12). Included in the table are
shares underlying options that are exercisable within sixty
days after February 1, 2000.
(2) This amount includes 6,000 shares of Common Stock underlying
options granted under the Rawlings Sporting Goods Company,
Inc. Non-Employee Directors' Stock Plan ("Directors' Plan")
and 6,607 shares of Common Stock Mr. Baur is entitled to
receive in lieu of directors' fees pursuant to the
Directors' Plan.
(3) This amount includes 3,375 shares of Common Stock underlying
options granted under the Directors' Plan and 1,128 shares
of Common Stock Ms. Griggs is entitled to receive in lieu of
directors' fees pursuant to the Directors' Plan.
<PAGE>
(4) This amount includes 16,667 shares of Common Stock
underlying options granted under the Rawlings Sporting Goods
Company, Inc. 1994 Long-Term Incentive Plan (the "Stock Option
Plan") and 696 shares of Common Stock beneficially owned under
the Rawlings Sporting Goods Company, Inc. Savings Plan (the
"401(k) Plan") as to which Mr. Hodgins has sole voting and
dispositive power.
(5) This amount includes 1,500 shares of Common Stock underlying
options granted under the Directors' Plan and 2,731 shares of
Common Stock Mr. Jarvie is entitled to receive in lieu of
directors' fees pursuant to the Directors' Plan.
(6) This amount includes 95,745 shares of Common Stock
underlying options granted under the Stock Option Plan and 13,049
shares beneficially owned under the 401(k) Plan as to which Mr.
Keene has sole voting and dispositive power.
(7) This amount includes 6,000 shares of Common Stock underlying
options granted under the Director's Plan and 6,709 shares
of Common Stock Mr. McDonnell is entitled to receive in lieu
of directors' fees pursuant to the Directors' Plan.
(8) This amount includes 5,000 shares of Common Stock underlying
options granted under the Stock Option Plan, 1,699 shares
held by Mr. Morrison's dependent children, 2,447 shares
owned by Mr. Morrison in an Individual Retirement Account
and 214 shares of Common Stock beneficially owned under the
401(k) Plan as to which Mr. Morrison has sole voting and
dispositive power.
(9) This amount includes 155,550 shares of Common Stock
underlying options granted under the Stock Option Plan and
595 shares beneficially owned under the 401(k) Plan, as to
which Mr. O'Hara has sole voting and dispositive power.
(10) This amount does not include Common Stock which may be
purchased by Bull Run Corporation pursuant to Common Stock
Purchase Warrants because such Warrants are not currently
exercisable. Mr. Prather is President and Chief Executive
Officer of Bull Run Corporation. This amount includes 1,500
shares of Common Stock underlying options granted under the
Director's Plan and 2,731 shares of Common Stock Mr. Prather
is entitled to receive in lieu of directors' fees pursuant
to the Directors' Plan.
(11) This amount includes 6,000 shares of Common Stock underlying
options granted under the Directors' Plan and 1,128 shares
of Common Stock Mr. Roarty is entitled to receive in lieu of
directors' fees pursuant to the Directors' Plan. Mr. Roarty
is retiring as a Director of the Company at this year's
Annual Meeting.
(12) This amount includes 6,000 shares of Common Stock underlying
options granted under the Directors' Plan and 1,128 shares
of Common Stock Mr. Robinson is entitled to receive in lieu
of directors' fees pursuant to the Directors' Plan.
<PAGE>
ITEM I -- ELECTION OF DIRECTORS
At the Annual Meeting, two Directors will be elected for a
term expiring at the annual meeting following the Company's
fiscal year ending August 31, 2002. Charles L. Jarvie and
Michael McDonnell have informed the Company they are willing to
serve for the term to which they are nominated if they are
elected. If either of these nominees should become unavailable
for election or is unable to serve as a Director, the shares
represented by proxies voted in favor of him will be voted for
any substitute nominee as may be named by the Board of Directors.
The candidate for election as a Director must receive a plurality
of the votes cast by the stockholders present in person or
represented by proxy and entitled to vote at the Annual Meeting.
The ages, terms of office and certain other information as
of August 31, 1999 with respect to Charles L. Jarvie and Michael
McDonnell, and each of the other persons serving as Directors are
as follows:
INFORMATION CONCERNING THE NOMINEES FOR TERM EXPIRING AT THE
ANNUAL MEETING OF STOCKHOLDERS FOLLOWING THE FISCAL YEAR
ENDING AUGUST 31, 2002
IF ELECTED,
TERM EXPIRES
AT
ANNUAL
MEETING
OF
STOCKHOLDERS
FOLLOWING
THE FISCAL
YEAR
NAME, AGE AND PRINCIPAL SERVED AS ENDING
OCCUPATION DIRECTOR SINCE AUGUST 31,
CHARLES L. JARVIE, 62 1998 2002
President and director of
Host Communications, Inc.
since 1993; director of
Bull Run Corporation, Chase
Bank of Texas, Total Sports
Manufacturing Co. and
Universal Sports America
Co.
MICHAEL MCDONNELL, 60 1994 2002
President of West Union
Corporation, a holding
company for the
distribution of hardware
and the manufacturing of
building products, since
1980; director of National
Commerce Bancorp.; part
owner of the St. Louis
Cardinals Major League
Baseball team since 1996.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE
ELECTION OF CHARLES L. JARVIE AND MICHAEL MCDONNELL, AS DIRECTORS
OF THE COMPANY.
<PAGE>
INFORMATION CONCERNING REMAINING DIRECTORS
TERM EXPIRES
AT
ANNUAL
MEETING
OF
STOCKHOLDERS
FOLLOWING
THE FISCAL
YEAR
SERVED AS ENDING
NAME AND PRINCIPAL OCCUPATION DIRECTOR SINCE AUGUST 31,
ANDREW N. BAUR, 55 1994 2000
Chairman of Mississippi
Valley Bancshares, a bank
holding company, and
Chairman of Southwest Bank
of St. Louis, the bank
subsidiary of Mississippi
Valley Bancshares, since
1984; Secretary and
Treasurer of the St. Louis
Cardinals Major League
Baseball team since 1996.
STEPHEN M. O'HARA, 44 1998 2000
Chairman of the Board and
Chief Executive Officer of
the Company since November
2, 1998; previously since
1994 President of Specialty
Catalog Corp., a direct
marketer targeting niche
consumer products.
ROBERT S. PRATHER, JR., 55 1998 2000
President and Chief
Executive Officer of Bull
Run Corporation since 1992;
director of Gray
Communications Systems,
Inc. since 1993 and interim
Executive Vice President-
Acquisitions since 1996;
Chairman of the Board of
Phoenix Corporation, a
steel service center, from
1980 to 1992.
LINDA L. GRIGGS, 50 1996 2001
Partner in the Business and
Finance Section of the law
firm of Morgan, Lewis &
Bockius LLP.
WILLIAM C. ROBINSON, 49 1994 2001
President of The Treehouse
Florida Fancy, Inc. since
1990; a consultant to F.W.
Woolworth Co. from 1988 to
1990; President and Chief
Executive Officer of
Robby's Sports, a 49 store
sporting goods retail
chain, from 1973 to 1988.
<PAGE>
BOARD OF DIRECTORS AND BOARD COMMITTEES
The Company's Certificate of Incorporation provides that the
Board of Directors shall consist of not less than one and no more
than ten members as shall be determined from time to time by vote
of a majority of the Directors then in office. Since the
Company's 1999 Annual Meeting of stockholders, the Board of
Directors consisted of eight members. Following the retirement
of Mr. Roarty at the 2000 Annual Meeting, the Board of Directors
will consist of seven members. Article Six of the Company's
Certificate of Incorporation provides that from and after the
first annual meeting of the stockholders the Company's Board of
Directors shall be divided into three classes, as nearly equal in
numbers as the then total number of Directors constituting the
Board permits. The members of each class are elected to serve
for a term of three years and until their successors are duly
elected and qualified, or until a member's death, resignation or
removal.
Under the present schedule, regular meetings of the Board of
Directors are held four times each year and additional special
meetings are called whenever necessary. The Board met nine
times during the fiscal year ended August 31, 1999. All of the
Directors attended at least 75% of the meetings of the Board of
Directors occurring during their respective terms and of the
committees of the Board of Directors on which they served at the
time of such meetings which were held during the fiscal year
ended August 31, 1999.
The Board of Directors has established an Audit Committee
consisting of Andrew N. Baur, William C. Robinson, Linda L.
Griggs and Robert S. Prather. Mr. Baur serves as Chairman of the
Audit Committee. The Audit Committee is authorized to recommend
to the Company's Board of Directors the independent public
accountants to be selected to audit the Company's annual
financial statements and to review the planned scope of the
annual external and internal audits, the independent accountants'
and internal auditors' report to management and management's
responses thereto and the effectiveness of the Company's internal
audit staff. The Audit Committee met twice during the fiscal
year ended August 31, 1999.
The Board of Directors has established a Finance Committee.
On April 1, 1999, the Board of Directors reconstituted the
Finance Committee to consist of Andrew N. Baur, Linda L. Griggs,
Michael McDonnell, Michael J. Roarty and William C. Robinson.
Prior to April 1, 1999, Mr. Prather was also a member of the
Finance Committee. Mr. Baur serves as Chairman of the Finance
Committee. The Finance Committee is authorized to review
acquisition prospects and capital expenditures in excess of
$500,000 and report to the Board of Directors. The Finance
Committee met six times during the fiscal year ended August 31,
1999.
The Board of Directors has also established a Compensation
Committee consisting of Michael McDonnell, Michael J. Roarty,
William C. Robinson and Charles L. Jarvie. Mr. Robinson serves
as Chairman of the Compensation Committee. The Compensation
Committee is authorized to establish remuneration levels for
Executive Officers, review the performance of the Chief Executive
Officer, review management organization and development, review
significant non-equity based employee benefit and executive
compensation programs and establish and administer equity-based
executive compensation programs, including the Stock Option Plan.
The Compensation Committee met twice during the fiscal year ended
August 31, 1999.
The Board of Directors has not established a nominating
committee.
The Bylaws provide that, unless nominated by the Board of
Directors, no person may be elected a director unless notice in
writing of such person's nomination by a beneficial or record
owner of common stock of the Company shall be received by the
Secretary of the Company not less than sixty days prior to the
first anniversary of the preceding year's annual meeting;
provided that in the event that the date of the annual meeting is
advanced by more than thirty days or delayed by more than sixty
days from such anniversary date, notice by the stockholder must
be delivered not later than the close of business on the later of
(i) the sixtieth day prior to such annual meeting, or (ii) the
tenth day following the date on which public announcement of the
date of such meeting is first made. Such notice must set forth
(a) the name and address of the nominating stockholder and of the
nominee, (b) a representation that such stockholder is a
beneficial or record owner of stock of the Company entitled to
vote in the election of directors at such meeting and intends to
appeal in person or by proxy at the meeting to nominate the
person or persons specified in the notice, (c) the name and
address of the record holder of the stock as it appears in the
Company's books and of the beneficial owners thereof, if any, on
whose behalf the nomination is<PAGE> made, (d) the class and number of
shares which are owned beneficially and of record by the
nominating stockholders and each proposed nominee, (e) a
description of all arrangements or understandings between the
stockholder and each nominee and any other person (naming such
persons) pursuant to which the nomination or nominations are to
be made by the stockholder, (f) such other information regarding
each nominee proposed by such stockholder as would be required to
be included in a proxy statement filed with the SEC pursuant to
Regulation 14A promulgated under the Exchange Act had the nominee
been nominated or intended to be nominated by the Board of
Directors, and (g) the consent of each nominee to serve as a
director of the Company if elected.
COMPENSATION OF DIRECTORS
The Company's Directors, except for those who are also
employees of the Company, receive an annual retainer fee of
$15,000 for service as a Director. In addition, each non-
employee Director receives meeting attendance fees of $1,000 per
meeting for special Board meetings or Committee meetings not held
in conjunction with a regular Board meeting. In 1999, the
directors elected to receive in lieu of cash payment of their
directors' fees a number of shares of Common Stock having a value
equal to the amount of the cash fees. The Company also
reimburses all of its Directors for their out-of-pocket expenses
incurred in the performance of their duties as Directors of the
Company.
Pursuant to the Rawlings Sporting Goods Company, Inc. 1994
Non-Employee Directors' Stock Plan (the "Directors' Plan"), the
non-employee Directors receive (i) a non-qualified stock option
having an exercise price equal to the fair market value on the
date of grant for 2,500 shares of the Common Stock upon their
initial election or appointment and, thereafter, a non-qualified
stock option for 1,000 shares of the Common Stock annually at the
date of the annual meeting, except that no more than one stock
option award may be granted to each non-employee Director in a
given calendar year, and (ii) the right to defer receipt of fees
in cash, and receive instead the right to delivery at a specified
future date of that number of shares of Common Stock having a
value at the time of deferral equal to the amount of cash
deferred.
EXECUTIVE COMPENSATION
BACKGROUND
The members of the Company's Compensation Committee during
the Company's fiscal year ended August 31, 1999, who are also
currently members of the Compensation Committee, were Michael
McDonnell, Michael J. Roarty, William C. Robinson and Charles L.
Jarvie.
Set forth below is the Compensation Committee's report on
executive compensation.
Notwithstanding anything to the contrary, the following
report of the Compensation Committee and the
Performance Graph 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 under the
Securities Exchange Act of 1934, as amended, except to
the extent that the Company specifically incorporates
this information by reference, and shall not otherwise
be deemed filed under such Acts.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee (the "Committee") of the Board of
Directors is charged with the responsibility to administer
compensation programs for the Company's executives. To this end,
the Committee has established the following fundamental
philosophy for executive compensation:
An appropriate and significant portion of each
executive's total compensation should be performance-
based and linked to the creation of value for
stockholders, and
Market practices and compensation levels must be
considered when establishing an appropriate<PAGE> program for
executives in order to assist the Company in attracting
and retaining high quality talent.
Pursuant to this philosophy, the Company's executive
compensation plans have been designed to remunerate executives
through three primary sources - base salary, annual cash
incentives and long-term equity-oriented incentives. The entire
program has been formulated so that the portion of an executive's
total compensation being derived from variable, performance-based
pay is greater at increasing levels of responsibilities.
Details regarding each of the primary facets of executive
compensation, along with a discussion of the awards made in
fiscal 1999, follows.
Base Salary
The Company targets salaries for executives at the median
(size-adjusted 50th percentile) of the competitive marketplace.
For purposes of each of the primary facets of compensation, the
competitive marketplace includes organizations of similar size in
the sporting goods industry.
In 1994, the Committee retained an independent, executive
compensation consultant. With the assistance of this consultant,
the Committee determined that salaries for the Company's top
executives needed to be increased to reflect the additional
duties and responsibilities resulting from the Company's spin-off
from Figgie. A multi-year process was implemented to move
salaries for these executives to market median levels within 2-3
years. Since the completion of that process, the Company has
increased salaries on an ad hoc basis, relying to a large extent
in the case of executives other than the Chief Executive Officer,
upon the recommendations of the Chief Executive Officer. The
salary increases depicted in the Summary Compensation Table
reflect this approach. Future increases to executive salaries
will be based on the Committee's discretionary evaluation of
Company and individual performance and increases occurring within
the marketplace.
Annual Cash Incentives
The Company maintains a management incentive plan whose
participants include certain management employees and all of the
Company's executives. The plan provides for the payment of
annual cash awards based upon the achievement of specified
Company goals and an evaluation of each executive's individual
performance.
Incentive opportunities are established for each executive
level at the beginning of each fiscal year, stated as a
percentage of base salary. These opportunities are set at levels
designed to approximate incentive opportunities for similar
positions within the competitive marketplace. Actual awards
earned are a function of the Company's performance; thus, actual
awards to the Company's executives may be below or above actual
median awards in the marketplace depending on how the Company
performs.
Annual incentives earned for fiscal 1999, as shown in the
Summary Compensation Table, reflect the Committee's evaluation of
the Company's performance against stated financial goals for
1999. As the Company did not achieve its planned goals
(primarily based on achievement of specified net income levels),
no incentive awards were granted.
Long-Term Equity-Based Compensation
The Company maintains a long-term incentive plan which
provides for the grant of stock-based incentive awards to certain
management employees and all of the Company's executives.
The Company utilizes nonqualified stock options granted at
fair market value as its primary long-term incentive. From time
to time, executives are granted stock options at levels
determined by the Committee based on a number of subjective
factors, including among other things, a general desire to
approximate median award levels within the competitive
marketplace. Since the executives derive no value from the
options unless the value of the Company's stock increase, these
awards support the Company's objective of linking executive
compensation to the creation of shareholder value.
Awards made to the Company's executives in fiscal 1999,
including the 263,850 options granted to Mr. O'Hara, are believed
to approximate the level of awards made to executives in similar
positions within the competitive marketplace.
<PAGE>
Section 162(m)
In December 1995, the IRS finalized rules regarding the
deductibility of compensation under Internal Revenue Code Section
162(m). The rules state that compensation in excess of
$1 million annually to any one executive will be non-deductible
for income tax purposes unless the compensation is "performance
based." At this point, none of the compensation paid by the
Company to its executives is non-deductible. The Committee will
monitor IRS rules and the Company's executive compensation
program to ensure, to the extent appropriate, that full
deductibility for such payments continues.
Michael J. Roarty William C. Robinson
Michael McDonnell Charles L. Jarvie
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
As discussed above under "Compensation Committee Report,"
the Compensation Committee has general responsibility for the
establishment, direction and administration of all aspects of the
compensation policies and programs for the Company's executive
officers. During the fiscal year ended August 31, 1999, the
members of the Compensation Committee were Michael McDonnell,
Michael J. Roarty, William C. Robinson and Charles L. Jarvie.
None of the members of the Compensation Committee were, during
the fiscal year ended August 31, 1999, an officer or employee of
the Company or any of its subsidiaries, or otherwise were
formerly an officer of the Company or any of its subsidiaries.
<PAGE>
SUMMARY OF COMPENSATION
The following table shows information concerning
compensation earned by or paid to the Company's Chief Executive
Officer and each of the four other most highly compensated
Executive Officers of the Company whose salary and bonus for the
twelve months ended August 31, 1999 exceeded $100,000. This
information is provided for the fiscal years ended August 31,
1999, 1998 and 1997.
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
SECURITIES ALL OTHER
NAME AND PRINCIPAL FISCAL OTHER ANNUAL UNDERLYING COMPENSATION
POSITION YEAR SALARY BONUS COMPENSATION OPTIONS (1)
<S> <C> <C> <C> <C> <C> <C>
Stephen M. O'Hara (2) 1999 229,167 0 86,759 (3) 263,850 32,406
Chairman and
Chief Executive Officer
Howard B. Keene 1999 161,250 0 - 15,000 4,691
President and 1998 206,072 8,126 - 33,000 4,095
Chief Operating Officer 1997 154,500 11,133 - 15,384 4,214
Rexford K. Peterson (4) 1999 187,436 0 26,013 (5) 0 0
Chief Financial Officer
Stan W. Morrison (6) 1999 145,454 0 94,338 (7) 40,000 400
Executive Vice President
Sales and Marketing
Jonathan Hodgins (8) 1999 150,000 0 87,716 (9) 15,000 3,375
Vice President Marketing 1998 144,892 0 - 25,000 3,000
</TABLE>
(1) The amounts indicated reflect 401(k) Plan contributions by
the Company on behalf of executive officers O'Hara, Keene,
Morrison and Hodgins of $2,406, $4,691, $400 and $3,375,
respectively and $30,000 in premiums on a life insurance
policy for Mr. O'Hara.
(2) Mr. O'Hara was selected as Chairman and Chief Executive
Officer on October 15, 1998.
(3) In connection with Mr. O'Hara's relocation from
Massachusetts, the Company paid $51,781 of relocation
expenses (including airfare and temporary accommodation
expenses in St. Louis, Missouri, real estate commissions and
other costs associated with the sale of Mr. O'Hara's home
and an amount equal to one month's salary for other
relocation expenses). In addition, the Company paid Mr.
O'Hara $15,272, which amount represents the amount
recognized by Mr. O'Hara for tax purposes in connection with
the Company's payment of the above-referenced relocation
expenses.
(4) Mr. Rexford K. Peterson was selected as interim Chief
Financial Officer on April 1, 1999. Mr. Peterson resigned as
Chief Financial Officer as of October 14, 1999. Mr. Michael L.
Luetkemeyer was selected by the Board of Directors to succeed Mr.
Peterson.
(5) Mr. Peterson lived in Dallas, Texas while he served as
interim Chief Financial Officer. The Company reimbursed Mr.
Peterson $6,457 for his travel expenses and $13,802 for his
living expenses while working for the Company in St. Louis,
Missouri.
(6) Mr. Morrison joined the company in October 1998.
<PAGE>
(7) In connection with Mr. Morrison's relocation, the Company
paid $55,543 of relocation expenses (including airfare and
temporary accommodation expenses in St. Louis, Missouri,
real estate commissions and transaction associated costs and
an amount equal to one month's salary for other relocation
expenses). In addition, the Company paid Mr. Morrison
$22,149, which amount represents the amount recognized by
Mr. Morrison for tax purposes in connection with the
Company's payment of the above-referenced relocation
expenses.
(8) Mr. Hodgins joined the Company in 1997.
(9) In connection with Mr. Hodgins' relocation from Canada, the
Company paid $46,998 of relocation expenses that included
real estate commissions on the sale of Mr. Hodgins' home as
well as airfare and temporary living expenses in St. Louis,
Missouri. In addition, the Company paid Mr. Hodgins
$22,577, which amount represents the amount recognized by
Mr. Hodgins for tax purposes in connection with the
Company's payment of the above-referenced relocation
expenses.
<PAGE>
STOCK OPTIONS
The following tables set forth certain information
concerning options granted during the fiscal year ended
August 31, 1999 to the Executive Officers named in the Summary
Compensation Table and the number and value of the unexercised
options held by such persons on August 31, 1999:
<TABLE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<CAPTION>
POTENTIAL
REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
STOCK PRICE
APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM (1)
(a) (b) (c) (d) (e) (f) (g)
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/SARs EXERCISE
UNDERLYING GRANTED TO OR
OPTION/ EMPLOYEES IN BASE PRICE EXPIRATION
NAME SARs GRANTED (#) FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
<S> <C> <C> <C> <C> <C> <C>
Stephen M. O'Hara 50,000 (2) $10.00 11/2/2003 $138,141 $305,255
50,000 (2) $11.00 11/2/2003 $151,955 $335,781
50,000 (2) $12.00 11/2/2003 $165,769 $366,306
50,000 (2) $13.00 11/2/2003 $179,583 $396,832
50,000 (2) $14.00 11/2/2003 $193,397 $427,357
12,000 (3) $10.04 3/14/2004 $33,286 $73,554
1,850 (3) 65% $10.13 3/14/2004 $5,178 $11,441
Howard B. Keene 15,000 (4) 4% $8.875 4/9/2009 $83,722 $212,167
Stan W. Morrison 15,000 (4) $9.875 10/14/2008 $93,155 $236,073
25,000 (4) 6% $8.875 4/9/2009 $139,536 $353,612
Jonathan Hodgins 15,000 (4) 4% $8.875 4/9/2009 $83,722 $212,167
</TABLE>
(1) The potential realizable value represents the amount each
Executive Officer might realize if the stock appreciates annually
at the assumed rates of 5% and 10% for the full period of the
options (10 years, except the options granted to Mr. O'Hara which
have a period of 5 years). The amounts represent only
hypothetical values and there can be no assurance that such
growth rates in stock price will be achieved. The actual amount
realized by each Executive Officer will be determined at the time
the options are exercised and will be based on the excess of the
fair market value of the stock at the time of exercise over the
exercise price.
(2) The options granted to Mr. O'Hara become exercisable in 20
percent increments on each of the date of grant and the first,
second, third and fourth anniversary dates of the date of grant,
November 2, 1998, subject to acceleration in the event of death
or disability of Mr. O'Hara, a change in control (as defined in
Mr. O'Hara's Employment Agreement with the Company) or as
otherwise determined by the Compensation Committee.
(3) The options have an exercise price equal to the market price
on the date of grant and become exercisable immediately upon
grant.
(4) The options have an exercise price equal to the market price
on the date of grant and become exercisable as to one-third
of the initial number of underlying shares of Common Stock on
each of the first, second and third anniversaries of the date
of grant, subject to acceleration in the event of death or
disability of the optionee, a change in control (as defined
in the Stock Option Plan) or as otherwise determined by the
Compensation Committee.
<PAGE>
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTIONS/SAR VALUES
(a) (b) (c) (d) (e)
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
SHARES OPTIONS/SARS AT OPTIONS/SARS AT
ACQUIRED FY-END (#) FY-END ($)
ON VALUE
EXERCISE REALIZED EXERCISABLE/ EXERCISABLE/
NAME (#) ($) UNEXERCISABLE UNEXERCISABLE (1)
Stephen M. O'Hara -0- -0- 113,850/150,000 0/0
Rexford K. Peterson -0- -0- 0/0 0/0
Howard B. Keene -0- -0- 84,745/37,000 5,347/6,563
Stan W. Morrison -0- -0- 0/35,000 0/10,938
Jonathan Hodgins -0- -0- 8,750/31,250 0/6,563
(1) The closing price of the Common Stock on the Nasdaq National
Market on August 31, 1999 was $9.3125 per share. Value is
calculated by determining the difference between the option
exercise price and $9.3125, multiplied by the number of
shares of Common Stock underlying the options.
RETIREMENT PLANS
All of the Executive Officers of Rawlings who were
previously employees of Figgie accrued retirement income credits
under Figgie's Retirement Income Plan II (the "Figgie Plan")
until the date of the initial public offering of the Company's
shares (the "IPO"). Such employees will receive, upon
retirement, benefits accrued under the Figgie Plan up until the
date of the IPO. In connection with the acquisition of the
Rawlings Business from Figgie, each of the Company's employees
has been given credit for vesting and eligibility to receive
benefits under the Company's retirement plan for service as an
employee of Figgie. In return, Figgie has provided full vesting
under the Figgie Plan for all employees of Rawlings who were
previously employees of Figgie.
As of July 8, 1994, the date of the IPO, the amount of
annual benefits payable upon retirement under the Figgie Plan,
including accrued benefits from a prior plan which was terminated
on November 21, 1988, to Mr. Keene who was an employee of Figgie
is $9,372.
The Company has not adopted a retirement plan.
EMPLOYMENT AGREEMENT
Effective November 2, 1998, the Company entered into an
employment agreement with Stephen M. O'Hara which provides for
(i) an initial annual salary of $275,000, with an annual salary
review and adjustment by the Compensation Committee, (ii) an
annual bonus of up to 75% of salary, which will be based upon
subjective and objective criteria established by the Compensation
Committee, (iii) the issuance of stock options to purchase
250,000 shares of Common Stock having the terms discussed below,
(iv) severance benefits if his employment with the Company is
terminated under certain circumstances following a change in
control of the Company, (v) a termination benefit, unless Mr.
O'Hara is terminated for cause, as defined in the employment
agreement, equal to two times Mr. O'Hara's base salary at the
time of termination and the continuation of certain benefits for
a period of two years following such termination, provided that
Mr. O'Hara may not receive such termination benefit in the event
of a change in control of the Company for which Mr. O'Hara
receives the benefits described below under "Severance
Agreements," (vi) a $2 million life insurance policy, (vii) an
automobile allowance, and (viii) certain relocation expenses and
miscellaneous perquisites.
<PAGE>
The stock options referred to above vest over a four year
period in 20% increments. The options that vest on the date of
grant are exercisable at a price per share equal to the closing
market price of the Common Stock on October 30, 1998 ($10.00),
and those vesting on the second, third and fourth anniversaries
are exercisable at $11.00, $12.00, $13.00 and $14.00,
respectively. In addition, for each share of Common Stock
purchased by Mr. O'Hara, up to the first 20,000 shares purchased
annually, Mr. O'Hara shall receive pursuant to the employment
agreement the option to purchase two shares of Common Stock at an
exercise price equal to the price at which such shares of Common
Stock were purchased.
SEVERANCE AGREEMENTS
The Company has entered into severance agreements with each
of the Executive Officers named in the Summary Compensation Table
(except Mr. Peterson) which provide various severance benefits to
certain Executive Officers if their employment with the Company
is terminated under certain circumstances following a change in
control of the Company. The agreements provide that a change in
control of the Company is deemed to have occurred if (i) a person
acquires beneficial ownership of 20% or more of the Company's
voting stock, (ii) individuals who, at the date of the agreement
or the beginning of a two-year period thereafter, constitute the
Board of Directors, cease for any reason to constitute a majority
of the Board, (iii) the stockholders approve a liquidation of the
Company, a sale or disposition of all or substantially all of the
Company's assets, or a merger, consolidation or reorganization of
the Company other than one that would result in (a) the holders
of the Company's voting stock continuing to own beneficially more
than 50% of the outstanding stock of the resulting corporation,
(b) no person who did not own voting stock prior to the
transaction owning 20% or more of the outstanding stock of the
resulting corporation, and (c) at least a majority of the board
of directors of the resulting corporation being members of the
Board of Directors of the Company at the date the severance
agreement was signed or at the beginning of a two-year period
thereafter that precedes the corporate transaction, or (iv) the
Board concludes that the Executive Officer is entitled to the
benefits because of the occurrence, threat or imminence of an
event with consequences similar to the foregoing.
Each of the agreements provides for severance payments in
the event of termination of the Executive Officer's employment
within a specified period after a change in control of the
Company (two and one-half years for Mr. Keene and two years for
other Executive Officers), unless the Executive Officer's
employment is terminated by the Company or its successors for
"cause" or "disability", because of the Executive Officer's death
or "retirement" or by the Executive Officer's voluntary
termination for other than "good reason", in each case as such
terms are defined in the agreements. The benefits consist of the
following: (a) an amount equal to two times the highest base
salary paid to each Executive Officer at any time up to the
termination of such Executive Officer's employment (except that
such amount shall be two and one-half times the base salary for
Mr. Keene and one-half times the base salary for Mr. Hodgins);
(b) salary and bonus (prorated assuming annual bonuses were paid
at the maximum level) to the date of termination; (c) medical,
dental, long-term disability and group term life insurance
benefits for two years if the Executive Officer makes his or her
required contribution (except Mr. Keene who shall receive such
benefits for two and one-half years); and (d) acceleration of the
vesting of all stock options. Under the Deficit Reduction Act of
1984, severance payments that exceed a certain amount subject
both the Company and the Executive Officer to adverse U.S.
federal tax consequences. Each of the agreements provides that
the Company shall pay the Executive Officer (i) the severance
benefits reduced to the extent necessary to avoid an excise tax
or (ii) unreduced severance benefits if, after application of the
excise tax, the severance benefits would be greater than the
severance benefits provided for in clause (i) above.
The Board has approved amendments to Mr. O'Hara's employment
agreement that provide for the following severance benefits upon
a change in control of the Company: (i) an amount equal to three
times his base salary at the time of termination; (ii) an amount
equal to the bonus, if any, paid to Mr. O'Hara in the prior year;
(iii) medical, dental, long-term disability and group term life
insurance benefits for three years; (iv) relocation expenses of
fifty thousand dollars if he moves more than fifty miles within
18 months from the effective date of termination; (v) the right
to purchase at fair market value or continue the lease of the
automobile provided by the Company; (vi) the acceleration of the
vesting of all stock options; and (vii) the forgiveness of any
indebtedness owed by Mr. O'Hara to the Company for any excess
split dollar life insurance premiums paid by the Company.
<PAGE>
STOCK PERFORMANCE GRAPH
The following graph compares the cumulative total
stockholder return on an investment of $100 in the Common Stock
on August 31, 1994 to August 31, 1999 with the cumulative total
return over the same period of (i) the Nasdaq Composite Market
Index and (ii) the Standard & Poor's Leisure Time Index and
assumes dividend reinvestment through the fiscal year ending
August 31, 1999:
[graph]
1994 1995 1996 1997 1998 1999
Rawlings $100.00 $76.00 $77.00 $85.00 $73.00 $75.00
Nasdaq Composite
Market Index $100.00 $133.00 $149.00 $207.00 $196.00 $378.00
S & P Leisure Time
(Products) Index $100.00 $118.00 $136.00 $171.00 $158.00 $141.00
<PAGE>
ITEM 2 -- RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors, at the recommendation of the Audit
Committee, has selected the firm of Arthur Andersen LLP as the
Company's independent public accountants for its fiscal year
ending August 31, 2000. Although the Bylaws of the Company do
not require the submission of the selection of independent public
accountants to the stockholders for approval, the Board of
Directors believes it is appropriate to give stockholders the
opportunity to ratify the decision of the Board of Directors.
The Board of Directors will not be bound by the stockholders'
vote at the Annual Meeting but will take into account the
stockholders' decision.
Representatives of Arthur Andersen LLP are expected to be
present at the Annual Meeting. They will have the opportunity to
make a statement should they desire to do so and will also be
available to respond to appropriate questions from stockholders.
Ratification of the selection of the independent public
accountants will require the affirmative vote of the holders of a
majority of the shares of Common Stock present in person or
represented by proxy at the Annual Meeting and entitled to vote,
provided a quorum is present.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION OF
THE SELECTION OF ARTHUR ANDERSEN LLP AS THE INDEPENDENT PUBLIC
ACCOUNTANTS OF THE COMPANY FOR THE COMPANY'S FISCAL YEAR ENDING
AUGUST 31, 2000.
ITEM 3 -- SHAREHOLDER PROPOSAL - REVOCATION OF RIGHTS AGREEMENT
Robert M. Raiff, 152 West 57th Street, 38th Floor, New York,
New York 10019, record holder of at least $2,000 of the Company's
Common Stock, has given notice that he will introduce the
following resolution and supporting statement at the Annual
Meeting:
RESOLVED: That the stockholders of the Company
hereby request that the Board of Directors revokes, and
to the extent necessary to effect such revocation,
redeems the Rights Agreement, dated July 1, 1994, and
all amendments thereto, and the Board of Directors will
not adopt any new Rights Agreement, or any other
arrangement having the effect of a Rights Agreement,
without the prior approval of a majority of the votes
cast by stockholders at a stockholder meeting.
The supporting statements: On July 1, 1994, the
Board granted one right to purchase one one-hundredth
of a share of Series A Junior Participating Preferred
Stock for each one outstanding share of the Company's
common stock (a "Right"). The Rights Agreement, which
has the effect of preventing any single stockholder or
group of stockholders from owning more than 23.1% of
the Company, without a direct approach to, and
agreement by, the Board of Directors, has been amended
three times. However, neither the substance nor the
intent of the original Rights Agreement has been
materially altered.
I believe that the terms of the Rights dampen
enthusiasm for the purchase of shares and are designed
to discourage or thwart an acquisition of the Company
at the expense of stockholders. Stockholders should
decide whether our Company needs a Rights Agreement,
and whether the Board of Directors should be given the
unilateral right to decide if an acquisition of the
Company is in the best interest of stockholders. I
have made this request in order to empower stockholders
to make these decisions.
In my view, the Board has displayed a limited
ability to increase stockholder value. As outlined by
the Company on page 16 of the Company's 1999 Proxy
Statement, stockholders of the Company have seen a 25%
decline in the value of their holdings, as measured by
cumulative total return on their investment from June
30, 1994 (when the Company began trading publicly)
until August 31, 1998. By contrast, over this same
period, the relevant Leisure Time Products Index has
characterized a 51% appreciation in value, and the
NASDAQ Index Composite increased in value by 112%.
I urge stockholders to vote FOR this resolution.
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST THIS
PROPOSAL FOR THE FOLLOWING REASONS:
On July 1, 1994, the Board granted one right to purchase one-
hundredth of a share of Series A Junior Participating Preferred
Stock for each one outstanding share of the Company's common
stock (a "Right"). The Rights Agreement is designed to provide
your Board with the ability to take steps to protect and maximize
the value of stockholders' investment in the Company in the event
an unsolicited attempt is made to acquire the Company.
The Rights Agreement is designed to encourage any potential
acquiror of the Company to negotiate directly with the Board,
which the Company believes is in the best position to negotiate
on behalf of all stockholders. The Rights do not affect any
takeover proposal which the Board may determine, in the exercise
of its fiduciary duties, adequately reflects the value of the
Company and is in the best interests of the Company's
stockholders, because under the terms of the Rights Agreement,
the Board has the power to redeem the Rights to permit such an
acquisition.
The overriding objective of the Board in adopting the Rights
Agreement was, and continues to be, the preservation and
maximization of the Company's value for all stockholders. The
Rights Agreement is a valuable negotiating tool that inhibits
abusive conduct and is designed to protect stockholders against
practices which do not treat all stockholders fairly and equally
(unsolicited takeover attempts can include a gradual accumulation
of shares in the open market, a partial or two-tier tender offer
that does not treat all stockholders equally, a squeeze-out
merger that squeezes out certain stockholders, or other abusive
takeover tactics). Mr. Raiff advocates revocation of the Rights
Agreement, and to the extent necessary to effect such revocation,
redemption of the Rights Agreement, and seeks to prevent the
Board from adopting any new Rights Agreement, or any other
arrangement having the effect of a Rights Agreement, without
prior approval of the stockholders. While redemption of the
Rights or rescission of the Rights Agreement may currently be in
the best interest of Mr. Raiff, one of the Company's larger
stockholders (at the time he submitted the proposal), the Board
does not believe, however, that redemption of the Rights or
rescission of the Rights Agreement would be in the best interests
of the Company and all of its stockholders. In fact, the Board
believes that the only proper time to consider redemption of the
Rights or rescission of the Rights Agreement is when a specific
offer is made to acquire the Company's stock. Redemption of the
Rights or rescission of the Rights Agreement at this time would
remove any incentive for a potential acquiror to negotiate with
your Board and eliminate a tool designed to ensure that all
stockholders are treated fairly and equally.
Stockholder rights agreements have become very common for
public companies. The adoption of the Rights Agreement does not
in any way weaken the financial strength of the Company or
interfere with its business plans, has no dilutive effect, does
not affect reported earnings per share, is not taxable to the
Company or to stockholders and does not change the way in which
shares of the Company presently can be traded. The Board
believes there is strong empirical evidence that such plans
better position the Board to negotiate the most attractive and
fair price for all stockholders. For example, a recent study
prepared by Georgeson & Company, Inc., a leading solicitation
firm, concluded that:
- Premiums paid to acquire companies with shareholders rights
agreements were on average 8% higher than companies without such
agreements;
- Shareholder rights agreements contributed an additional $13
billion in shareholder value in the aggregate from 1992 to 1996,
and shareholders of acquired companies without shareholder rights
agreements gave up $14.5 billion in potential premiums;
- The presence of a shareholder rights agreement did not
increase the likelihood of the withdrawal of a friendly bid nor
the defeat of a hostile bid; and
- Shareholder rights agreements did not reduce the likelihood
of a company becoming a takeover target.
The Georgeson study is available on the Internet at
www.Georgeson.com. Many companies with rights agreements have
received unsolicited offers and have redeemed their rights after
their directors were satisfied that the offer, as negotiated by the
company's board of directors, adequately reflected the underlying
value of the company and was fair and equitable to all stockholders.
Thus, experience indicates that rights agreements neither prevent
unsolicited offers from occurring, nor prevent companies from
being acquired at prices that are fair and adequate to stockholders.
<PAGE>
The adoption of the Rights Agreement by action of the Board
is in accord with the Board's responsibility under Delaware law
to manage and direct the management of the Company's business and
affairs and, as a legal matter, does not require stockholder
approval.
FOR ALL OF THESE REASONS, YOUR BOARD RECOMMENDS THAT THE
STOCKHOLDERS VOTE AGAINST THE PROPOSAL. PROXIES SOLICITED BY THE
BOARD WILL BE SO VOTED UNLESS A STOCKHOLDER SPECIFIES A CONTRARY
CHOICE IN HIS OR HER PROXY.
CERTAIN TRANSACTIONS
Mr. Baur is the Secretary and Treasurer of St. Louis
Cardinals L.P. During the fiscal year ended August 31, 1999, the
Company sold approximately $285,000 of product to St. Louis
Cardinals L.P. The Company believes that the terms and prices
for the sale of these products are no less favorable than those
obtained from unaffiliated parties.
Mr. Jarvie is the President and a director of Host
Communications, Inc. During the fiscal year ended August 31,
1999, the Company purchased approximately $442,000 of catalogues
and promotional posters from Host Communications, Inc.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") requires the Company's directors and
executive officers, and persons who own more than 10% of the
Company's outstanding Common Stock, to file with the Securities
and Exchange Commission initial reports of ownership and reports
of changes in ownership in the Company's Common Stock and other
equity securities. In addition, under Section 16(a), a director,
executive officer or 10% stockholder who is a trustee and has a
pecuniary interest (such interest includes situations where a
member of the trustee's immediate family is a beneficiary of the
trust) in any holding or transaction in the Company's securities
held by the trust, must report the holding or transaction on the
trustee's individual form. Securities and Exchange Commission
regulations require directors, executive officers, greater than
10% stockholders and reporting trusts to furnish the Company with
copies of all Section 16(a) reports they file.
Except as described below, to the Company's knowledge, based
solely on a review of the copies of such reports furnished to the
Company and written representations that no other reports were
required, during the fiscal year ended August 31, 1999, all
Section 16(a) filing requirements applicable to the directors,
executive officers and greater than 10% stockholders were met.
Through a record-keeping error at the Company, one Report on Form
5 of one exempt grant of shares of Common Stock in lieu of
directors' fees pursuant to the Directors' Plan was not timely
filed on behalf of each of Messrs. Andrew N. Baur, Charles L.
Jarvie, Michael McDonnell, Robert S. Prather, Jr. and Michael J.
Roarty, directors of the Company, one Report on Form 3 was not
timely filed on behalf of each of Messrs. Stanley W. Morrison,
Stephen M. O'Hara and Rexford K. Peterson, each executive
officers of the Company and one Report on Form 4 was not timely
filed on behalf of Mr. J. Michael Thompson, an executive officer
of the Company, reflecting the sale of shares of Common Stock by
his wife.
<PAGE>
STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
Any stockholder proposal submitted to the Company pursuant
to SEC Rule 14a-8 under the Exchange Act for inclusion in the
Company's proxy statement and proxy relating to the Company's
2001 Annual Meeting of Stockholders must be received by the
Company no later than October 21, 2000. Any stockholder
intending to nominate an individual for election to the Board of
Directors at the Company's 2001 Annual Meeting of Stockholders
must provide written notice to the Company not later than
February 12, 2001. If the Company does not receive notice of any
other non-Rule 14a-8 matter that a stockholder wishes to raise at
the Annual Meeting in 2001 by February 12, 2001, the proxy
holders will retain discretionary authority to vote proxies on
such matters if they are raised at the 2001 Annual Meeting of
Stockholders. Such proposals must also comply with the other
requirements of the proxy solicitation rules of the Securities
and Exchange Commission and the provisions of the Company's
bylaws. A copy of the Company's bylaws may be obtained upon a
written request submitted to the Company's Secretary at the
address, below. Stockholder proposals should be directed to:
HOWARD B. KEENE
SECRETARY
RAWLINGS SPORTING GOODS COMPANY, INC.
1859 INTERTECH DRIVE
FENTON, MISSOURI 63026
OTHER MATTERS
The Board of Directors does not know of any matters to be
presented at the Annual Meeting other than those listed in the
Notice of Annual Meeting of Stockholders. However, if other
matters properly come before the Annual Meeting, it is the
intention of the persons named in the accompanying proxy to vote
in accordance with their best judgment on such matters.
To the extent that information contained in this Proxy
Statement is peculiarly within the knowledge of persons other
than the management of the Company, it has relied on such persons
for the accuracy and completeness thereof.
YOU ARE URGED TO COMPLETE, DATE, SIGN AND RETURN YOUR PROXY
PROMPTLY TO MAKE CERTAIN YOUR SHARES WILL BE VOTED AT THE ANNUAL
MEETING. FOR YOUR CONVENIENCE, A RETURN ENVELOPE IS ENCLOSED
REQUIRING NO ADDITIONAL POSTAGE IF MAILED IN THE UNITED STATES.
By Order of the Board of Directors
/s/ Howard B. Keene
Howard B. Keene
Secretary
Dated: March 1, 2000.
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APPENDIX A -- PROXY CARD
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PROXY
2000 ANNUAL MEETING OF STOCKHOLDERS OF RAWLINGS SPORTING GOODS
COMPANY, INC.
The undersigned hereby appoints Stephen M. O'Hara and Howard
B. Keene, and each of them, each with the power to act alone and
with full power of substitution and revocation, as attorneys and
proxies of the undersigned to attend the Annual Meeting of
Stockholders of Rawlings Sporting Goods Company, Inc. (the
"Company") to be held at Maritz, Inc., 1355 N. Highway Drive,
Fenton, Missouri 63099, on Thursday, April 13, 2000, commencing
at 9:00 a.m., local time, and at all adjournments thereof, and to
vote all shares of capital stock of the Company which the
undersigned is entitled to vote with respect to the following
matters, all as set forth in the Notice of Annual Meeting of
Stockholders and Proxy Statement, dated February 22, 2000:
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE "FOR"
ITEMS 1 AND 2 AND "AGAINST" ITEM 3.
ITEM 1: Election of two Directors for a class of Directors to
serve until the annual meeting following the Company's
fiscal year ending August 31, 2002.
__ __
/_/ FOR the nominees listed below: /_/ WITHHOLD AUTHORITY to
NOMINEES: Charles L. Jarvie vote for those nominees
Michael McDonnell listed below:
________________________
ITEM 2: Proposal to ratify the selection of the accounting firm
of Arthur Andersen LLP as independent public
accountants of the Company for the Company's fiscal
year ending August 31, 2000.
__ __ __
/_/ FOR /_/ AGAINST /_/ ABSTAIN
ITEM 3: Shareholder Proposal to revoke the Rights Agreement,
dated July 1, 1994, if properly introduced at the
Annual Meeting.
__ __ __
/_/ FOR /_/ AGAINST /_/ ABSTAIN
In their discretion, the proxies are authorized to vote upon
such other business as properly may come before the Annual
Meeting.
This Proxy, when properly executed, will be voted in the
manner directed herein by the undersigned stockholder(s). IF NO
DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR" ITEMS 1 and 2
and "AGAINST" ITEM 3.
Dated: _________________, 2000
____________________________
Signature
____________________________
Signature (if held jointly)
Please sign exactly as name
appears hereon. When shares
are held by joint tenants,
both should sign. When
signing as an attorney,
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,
please sign in partnership
name by authorized person.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY
USING THE ENCLOSED POSTAGE PREPAID ENVELOPE
<PAGE>
